On August 16 a notice was placarded outside the General Post Office to the effect that, as all the Spanish staff had refused to work for the Americans, the local and provincial correspondence could not be attended to. This was, however, soon remedied.
In an order issued on August 22 it was enacted that all natives and all Spanish soldiers were to be disarmed before they were admitted into the walled city. The insurgent troops were included in the above category, but their arms were restored to them on their leaving the city. An exception was made in favour of the insurgent officers, from the grade of lieutenant upwards, who were permitted to enter and leave Manila with their swords and revolvers.
On August 25 a provisional agreement was entered into between the American authorities and Emilio Aguinaldo, to remain in force pending the result of the Paris Peace Commission, whereby their respective spheres were defined. The Americans retained jurisdiction over Manila City, Binondo, the right bank of the Pasig River up to the Calzada de Iris and thence to Malacañan, which was included. The remaining districts were necessarily in the hands of the rebels, there being no recognized independent government in Luzon other than the American military occupation of the capital and environs.
Towards the end of August, the American Commander-in-Chief, Maj.-General Wesley Merritt, quitted the Islands in order to give evidence before the Peace Commission at Paris, after having appointed General E. S. Otis to be the first Military Governor of Manila.
The British Consul, Mr. E. A. Rawson Walker, who had rendered such excellent service to both the contending parties, died of dysentery in the month of August, and was buried at Paco cemetery.
Philippine refugees returned to the Islands in large numbers, but the American authorities notified the Consul in Hong-Kong that only those Chinese who could prove to his satisfaction previous residence in Manila would be allowed to return there.
Trading operations were resumed immediately after the capitulation, and the first shipment of cigars made after that date was a parcel of 140,000 exported to Singapore in the first week of September and consigned to the Tabaqueria Universal. Business in Manila, little by little, resumed its usual aspect. The old Spanish newspapers continued to be published, and some of them, especially El Comercio, were enterprising enough to print alternate columns of English and Spanish, and, occasionally, a few advertisements in very amusing broken English. Two rebel organs, La Independencia and La República Filipina, soon appeared. They were shortly followed by a number of periodicals of minor importance, such as El Soldado Español, La Restauracion (a Carlist organ), Thé Kon Leche, El Cometa and El Motin (satirical papers) and two American papers, viz., The Manila American and The Manila Times. Liberty of the press was such a novelty in Manila that La Voz Española over-stepped the bounds of prudence and started a press campaign against the Americans. Delgado, the editor, after repeated warnings from the Provost-Marshal, was at length arrested. The paper was suppressed for abusing the Americans from the President downwards, and publishing matter calculated to incite the Spanish inhabitants to riot. The capital was seething with opposition to the new conditions; many were arrested, but few lamented the incarceration, for the prison was the porch which led to fame, and through it all who were ambitious to rise from obscurity had to pass. Moreover, imprisonment (for mere trifles) was such a commonplace event in Spanish times that no native lost caste by the experience of it, unless it were for a heinous crime which shocked his fellows. Meanwhile, in the public ways and the cafés and saloons, altercations between the three parties, Spanish, native, and American, were of frequent occurrence.
For some weeks before the capitulation there had been a certain amount of friction between the American soldiery and the rebels, who resented being held in check by the American authorities. Emilio Aguinaldo had his headquarters at Bacoor, on the Cavite coast, situated between two divisions of the American army, one at Cavite and the other at Manila, and within easy shelling distance from the American fleet. For obvious reasons he decided to remove his centre of operations, for it was becoming doubtful how long peace between the two parties would continue. The rebels had been sorely disappointed that they were not allowed to enter Manila with the Americans, or even before, for since the first few months of the rebellion they had pictured to themselves the delights of a free raid on the city. Aguinaldo therefore removed his headquarters to a place three miles north of Manila, but General Otis requested him to go farther away from the capital. As he hesitated to do so the General sent him an ultimatum on September 13 ordering him to evacuate that place by the afternoon of the 15th, so during the night of the 14th Aguinaldo moved on with his troops to Malolos. From this town, situate about 20 miles from Manila, he could better unite and control the rebel factions here and there over the northern provinces; he could, moreover, either make use of the line of railway or cut off the connection with Manila, or he could divert supplies from the rich rice districts and Pangasinán ports, whilst the almost impregnable mountains were of easy access in case of need.
Aguinaldo declared Malolos to be the provisional capital of his Revolutionary Government, and convened a Congress to meet there on September 15 in the church of Barasoain.[14] Fifty-four deputies responded to the summons, and in conformity with Aguinaldoʼs proclamation of June 23 they proceeded to elect a President of Congress, Vice-President, Secretaries, etc. The result of the voting was a remarkable event of the revolution. Don Pedro A. Paterno was elected President of Congress! The man whom the revolutionists had, less than four months before, so satirically admonished for his leaning towards Spanish sovereignty, was chosen to guide the political destinies of this budding democracy and preside over their republican legislative body! Deputies Benito Legarda and Ocampo were chosen to be Vice-President and Secretary respectively. Congress voted for Aguinaldo a salary of ₱50,000 and ₱25,000 for representation expenses. These figures were afterwards reversed, i.e., ₱25,000 salary, and ₱50,000 for expenses; but Aguinaldo, who never showed any desire for personal gain, was quite willing to set aside the vote. A decree in Congress, dated September 21, imposed compulsory military service on every able-bodied Philippine male over 18 years of age, except those holding office under the Revolutionary Government. At an early session of Congress Deputy Tomas del Rosario made a long speech advocating Church Disestablishment.[15]
The night before Congress met to announce the election of President, etc., an attempt was made to poison Emilio Aguinaldo. Dinner was about to be served to him; the soup was in the tureen, when one of the three Spanish prisoners who were allowed to be about the kitchen tasted the soup in a manner to arouse suspicion. The steward at once took a spoonful of it and fell dead on the spot. The three prisoners in question, as well as 11 Franciscan friars, were consequently placed in close confinement. At the next sitting of Congress the incident was mentioned and it was resolved to go en masse to congratulate Aguinaldo on his lucky escape. At 5 p.m. the same day a Te Deum was sung in Malolos Church anent this occurrence.