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ment; and, secondly, the lack of a good market for the coffee produced by the island, and the panic created by the impending danger of the free sugar provision of the tariff act, which will go into effect next year. This has made it necessary for the owners of sugar mills, some of which are heavily mortgaged, to introduce economies in their annual budgets, so as to put themselves in a position to be able to meet the new conditions to be brought about by the placing of sugar on the free list.

A great part of the time of the personnel of the bureau was devoted to an endeavor to effect a compromise of the differences between the owners of the sugar mills and the agricultural laborers, which culminated in the big strike declared in January and ended in March, 1915. This strike has been the most important one ever declared in Porto Rico.

Although the personnel of the bureau is very limited, their work was so efficiently done that they were able to cope with the situation created by the strike and in a great number of cases it was through their efforts that compromises satisfactory to both parties were effected.

The success of the bureau in obtaining a settlement of all the differences at all the places where the strike was declared would have been complete but for the intervention of the labor agitators, who were interested in having the strike spread and continued for a longer period.

Statistics collected by the bureau show that at 14 sugar mills, at which there was no strike or where the strike was settled before the outside agitators took part in it, the laborers obtained 20 per cent increase over the wages prevailing in 1914 and the hours of work per day were reduced upon the same basis.

As soon as the outside agitators began to take part in the strike and to preach violence and lawlessness as a means for securing higher wages and shorter hours of work, fires were started in the cane fields at different parts of the island and great damage was done to the properties of the employers.

The government could not ignore the appeals for protection against such acts of lawlessness and disorder, and in the attempts made by the insular police to restore order and to prevent the wanton destruction of property clashes between the police and the strikers occurred at Juncos, Vieques, and Ponce, which unfortunately resulted in the killing of five or six strikers and the serious wounding of two policemen.

The bureau is charged with the duty of enforcing the law regulating the work of women and children and the law regulating the construction of scaffolds; and in compliance with the provisions of those two laws the bureau inspected 450 establishments located in 47 different towns and at which a total of 10,074 women and 573 children was employed; and officials of the bureau visited 38 towns to enforce the scaffold law, making for that purpose 243 inspections of 195 constructions, of which 97 were suspended and 74 approved as to the safety of the scaffolds.

Five employers were denounced for violations of the women and children labor law. In three cases the defendants were found guilty and paid the fines imposed and in the other two cases appeals have been filed.

The necessity of a law providing for the insurance of workmen against industrial accidents is greatly felt. During the last session of the legislature a new and strong effort was made for the passage of a bill providing such a system of insurance of workmen. The bill received the unanimous vote of the executive council, but the house of delegates failed to consider it. Another effort will be made at the next session of the legislature to have the said bill enacted.

The work of the free employment agency maintained by the bureau of labor has been successful, notwithstanding the lack of cooperation on the part of the employers and other unfavorable conditions. The table submitted by the department shows that there were 651 applicants during the year, of which 287 were recommended, 70 were employed, and 60 failed to report the result of the recommendation.

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CONCLUSION.

Taking everything into consideration, the year has been one of reasonable business prosperity for Porto Rico. The gains to business that resulted from the great war exceeded on the whole the losses. There have been no labor disturbances, excepting the strike among the sugar workers, and this was not a strike of despairing protest against reductions in wages, but a natural and perfectly proper effort on the part of the workers to participate in the new and unexpected prosperity that had come so suddenly to this industry, a strike which, I am happy to say, succeeded in part in accomplishing its object.

The enhanced price of sugar that has resulted from the war has renewed confidence in the immediate future of this industry, so that notwithstanding the fear of free sugar still impending the plantings were largely increased, and with the continuance of favorable weather conditions there will be produced next year the largest crop on record. One result of this will be an increase in the assessments of real and personal property to the highest figure in the history of the island.

It becomes more and more manifest every year that the fundamental cause of the bad social conditions and most of the other difficulties in the path of progress of Porto Rico is the large population, which, already enormous, is steadily and rapidly increasing.

For this fundamental evil some direct and fundamental remedy must some time be found and applied.

Special attention is again invited to two or three recommendations made in last year's report, which stand out as matters of still more urgent importance this year.

(1) A thorough revision of the organic act under which the civil government was organized 15 years ago. This has been many times asked for, often recommended and promised, but somehow long delaved. A new organic act was before the last Congress and unanimously approved by the Committee on Insular Affairs of the House of Representatives. It would have passed both Houses, probably, but for the fact that no time could be found for its consideration. It is most urgently recommended that this important matter receive as prompt attention as possible.

(2) The project of the dredging of San Juan Harbor and the reclamation of the adjacent swamp lands by the Federal Government in

cooperation with the insular government which is the owner of the lands.

This project has received the indorsement of the Engineers of the War Department and is founded upon the necessity for enlarging the deep-water area of the harbor to meet the demands of a large and growing commerce. In spite of the restrictions to trade caused by the great war the commerce of San Juan Harbor has increased even during the past year, and if it should be dredged in the manner recommended, there is every reason to believe that it would speedily become, with the improvements being provided by the insular government and with the expansion that would come with the close of the war and the development of traffic through the Panama Canal, one of the best and most important harbors in the Caribbean Sea. When allowance is made for the reclaimed lands under the cooperative plan recommended, the ultimate cost of this project to the Federal Government would be practically nothing.

(3) The admission of Porto Rico to participation in all the operations of the militia laws of the United States on equal terms with the States and Territories of the Union. The purpose of these laws is manifestly to assure the preparedness of our people for national defense should the need arise. The experience of the nations engaged in the great European war has conclusively proved that the men drawn from distant colonies and dependencies are just as useful and available as those drawn from the nation itself. There is now widespread interest in Porto Rico in the formation of militia organizations. It is believed that at least one regiment of militia of excellent material for its ranks could be speedily raised if the opportunity were afforded. The moral, educational, and political effects of such organizations upon the youth of the island would be excellent and the advantage to the country at large is apparent.

It is a pleasure to conclude this report with the statement that in spite of all the difficulties and perplexities the past memorable year has brought in its train, it has, nevertheless, been a year of real and hopeful progress for Porto Rico, both from the point of view of political growth and that of business and industrial development. Very respectfully, your obedient servant,

ARTHUR YAGER,

Governor of Porto Rico. The SECRETARY OF WAR,

Washington, D. C.

REPORT OF THE ATTORNEY GENERAL.

DEPARTMENT OF JUSTICE,

Washington, D. C., December 6, 1915. To the Senate and House of Representatives of the United States of

America in Congress assembled :

I have the honor to submit a report of the business of the Department of Justice during the fiscal year ended June 30, 1915, together with some recommendations for new legislation.

RECOMMENDATIONS.

1. AMENDMENT OF COMMODITIES CLAUSE OF INTERSTATE COMMERCE

АСТ. .

I renew my recommendation relating to the amendment of the commodities clause of the interstate commerce act. In United States v. Delaware & Hudson Co. (213 U. S., 366) the Supreme Court construed the commodities clause as prohibiting a railroad from transporting articles produced, mined, or purchased by it only where it has an interest in the articles in a legal or equitable sense at the time of transportation. It further held that a railroad does not necessarily have an interest in a legal or equitable sense in articles produced, mined, or purchased by a bona fide corporation of which the railroad is a stockholder. In a later case (United States v. Lehigh Valley Railroad Co., 220 U. S., 257) the court held that if the corporation owning the articles transported by the railroad was so identified with the railroad as in fact to be but an arm of the railroad, then the railroad would have an interest in the articles in the sense of the statute. The following plan was devised to meet the requirements of the statute as thus construed :

A railroad engaged, say, in mining coal, either directly or indirectly through a controlled corporation which is but a part of itself, will organize a new corporation, the stock of which is distributed ratably amongst the stockholders of the railroad and the management of which will be dominated by officers of the railroad. Thereupon the railroad will sell to the new corporation at the mouth of the mines its production of coal under a contract which puts the new corporation largely, if not completely, within the power of the railroad.

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