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 Foreword
 Table of Contents
 Introduction
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Title: The Caribbean at Mid-Century
Publisher: University Press of Florida
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Title: The Caribbean at Mid-Century
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Language: English
Creator: Wilgus, A. Curtis
Publisher: University of Florida Press
Place of Publication: Gainesville, FL
Publication Date: 1951
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Table of Contents
    Front Cover
        Page i
    Frontispiece
        Page ii
    Title Page
        Page iii
    Copyright
        Page iv
    Contributors
        Page v
        Page vi
    Foreword
        Page vii
        Page viii
        Page ix
        Page x
    Table of Contents
        Page xi
        Page xii
    Introduction
        Page xiii
        Page xiv
        Page xv
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Full Text





The

CARIBBEAN

at MID-CENTURY


SERIES ONE


VOLUME I


A publication of the
SCHOOL OF INTER-AMERICAN STUDIES


ISSUED WITH ASSISTANCE FPOM
THE WALTER. B. FRAERIB PUBLICATION FUND







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The

CARIBBEAN

at MID-CENTURY

edited by A. Curtis Wilgus


1951
UNIVERSITY OF FLORIDA PRESS
Gainesville













Cojynght, 1951, by the
UNIVERSITY OF FLORIDA
Au RoIGHT RESaax





THIS VOLUME contains the papers delivered at the first
annual conference on the Caribbean held at the University of
Florida, December 7-9, 1950.






























Paied by
Tin H &f W. DEW COMANy
JAncarvms, Fiouma












Contributors


GERMnN ARCINIEGAS, Professor of Spanish, Columbia University
RAYMOND E. CRST, Professor of Geography, University of Mary-
land
RAMON COL6N-TORRES, Commissioner of Agriculture of Puerto
Rico, San Juan
JOHN ARMSTRONG CROW, Chairman, Department of Speech, Uni-
versity of California at Los Angeles
J. M. CRUXENT, Director, Mus6o Nacional, Caracas, Venezuela
MANUEL ELGUETA, Chief, Plant Industry Department, Inter-
American Institute of Agricultural Sciences, Turrialba, Costa
Rica
JOHN Gum.I, Professor of Anthropology, Institute for Research in
Social Science, University of North Carolina
HARRY F. GUGGENHEIM, President, Daniel and Florence Guggen-
heim Foundation and Harry Frank Guggenheim Foundation
LEWIS HANKE, Director, Hispanic Foundation, Library of Congress
JORGE MANACH, Professor of Spanish American Literature, Colum-
bia University
J. LLOYD MECHAM, Professor of Government, University of Texas
MANUEL A MESA, Chief, Latin American Unit, Division of Eco-
nomic Stability and Development, Department of Economic Af-
fairs, U. N.
EDWARD G. MLLER, JI., Assistant Secretary of State for Latin
American Affairs
J. HIuLs MILLER, President, University of Florida
WILLIAM R. MIZE.E, Associate Editor, McGraw-Hill International
Corporation, N. Y.
LowRY NELSON, Professor of Sociology, University of Minnesota







vi The Caribbean at Mid-Century
MAYNARD PHELPS, Professor of Marketing, University of Michigan
WILsoN POPENOE, Director, Escuela Agricola Panamericana, Te-
gucigalpa, Honduras
Josi ANT6NIO PORTUONDO, Professor of Spanish, Columbia Uni-
versity
A. CURTIS WILGus, Director, School of Inter-American Studies,
University of Florida
SmvIo ZAVALA, Director, Mus6o Nacional de Historia, M6xico, D. F.












Foreword


IT IS altogether fitting that the University of Florida should
bring together from time to time the great leaders in Latin Amer-
ican affairs, and that it should publish the fruits of their delibera-
tions. For the historical roots of Florida, reaching back to the
Spanish conquest, are intimately interwoven with those of the
island republics and mainland nations which girdle the Caribbean
Sea. Florida's future prosperity and security, too, require our con-
tinued recognition of this common ancestry.
Upon the soil of this state were established the first settlements
made by the conquistadors within the borders of our present-day
nation. Though Florida, as a colony, could not rival the fabled
riches of Peru and Mexico, her fortified shorelines served Spain as
bastions against French, English, and Dutch corsairs who sought
to ravish the silver galleons as they sailed through the Bahama
Channel Paradoxically, those same shores provided bases for the
marauders in their sallies against the treasure-laden ships of the
Spanish Crown. And it reputedly was here, in Florida's off-shore
waters, that Jenkins lost the famous ear which gave its name to a
war.
Florida's colonial past and the history of the conquest of the
Americas share many names of famep-Ponce de Le6n, Panfilo de
NarvAez, Hernando de Soto, Men6ndez de Avil6s. In ancient St.
Augustine, still historically unspoiled, lies North America's finest
monument to our Spanish past: the stout fortress of Castillo de
San Marcos.
What better place, then, than the campus of the University of
Florida for men of learning to exchange views about "The Carib-
bean at Mid-Century"? What better vantage point from which to
review the fifty years just closed, and from which to peer ahead
into the half-century to come.
The University of Florida long has been conscious of its rich
heritage, and of its concomitant responsibility to cultivate inter-







viii The Caribbean at Mid-Century
American understanding through education. Formally, our pro-
gram began over a generation ago when, in 1930, the University's
Institute of Inter-American Affairs was born. The guiding princi-
ple of this program, whether it finds expression in conferences,
graduate or undergraduate curricula, research, or publications, is
the same today as always: to help the peoples of all the Americas
to know one another better, and thus to live together in greater
harmony.
In the two decades following establishment of the institute,
interest in Latin American studies mushroomed so dramatically
that our inter-American program was forced to grow. Through the
years, new courses were added, and area specialists were invited to
join our staff. Another significant milestone was reached in Sep-
tember, 1950, when our graduate School of Inter-American
Studies was formed, under the able leadership of Dr. A. Curtis
Wilgus, eminent historian and educator of wide renown in
Hispanic-American affairs. Today, thanks to greatly expanded
curricula and to the excellence of instruction now available from
our enlarged staff of area experts, students may enroll for Latin
American studies leading to the M.A. and Ph.D. degrees in many
fields. Rich course offerings also are available on the undergraduate
level.
Because of Florida's subtropical climate, students from many
Latin American countries find the University's courses in agricul-
ture, animal industry, soil science, and other technical fields
especially applicable in solving problems encountered in their home-
lands. At the time of the conference, 102 students from 14 Latin
American nations were enrolled at the University, 84 of whom
were receiving scholarship aid. Latin American alumni today
number over 300.
In the area of research and publications, our library holdings of
Latin American materials are being enlarged steadily. Our Uni-
versity Press is embarked on a noteworthy schedule of area publi-
cations, and soon will release several new titles, including Volume
14 of The Handbook of Latin American Studies. A contract for
publication of this indispensable tool of scholarship, until now pub-
lished by Harvard University Press, recently was awarded to our
Press by the Library of Congress.
Architect's plans already have been prepared for a proposed







FOREWORD ix
Inter-American House, which will occupy a site rich in historical
significance. The University campus occupies part of a grant of
some 200,000 acres made by King Ferdinand VII of Spain to the
Spanish grandee, Don Fernando de la Maza Arredondo. A key
location on the campus has been set aside for the School o Inter-
American Studies and all related activities, including conferences.
The inter-American program of the University of Florida is our
answer to those who would divide to conquer, to those who would
despair of peace among men in our times. True, the area we have
pledged to serve is but a segment of what we hope and pray will
be a united world. But it is an important segment. It is a segment
we can comprehend, and to which we can realistically hope to
make a vital contribution.
This conference on "The Caribbean at Mid-Century" and others
which will follow should aid materially in the task of translating
these hopes into realities.

J. Hn- s Mn.ZLLn, President
University of Florida















Contents






Map of Caribbean Area Frontispiece
List of Contributors . v
Foreword J. HLL MLLER ii
Introduction A. Cu~TIS WILGUS xii


Part I-INTER-AMERICAN RELATIONS OF THE
CARIBBEAN AREA

1. Edward H. Miller, Jr.: INTER-AMERICAN RELATIONS AT
MID-CENTURY 1
2. Harry F. Guggenheim: HEMISPHERE INTEGRATION NOW 10


Part II-ECONOMIC AND GEOGRAPHICAL PROBLEMS
OF THE CARIBBEAN AREA

3. Raymond E. Crist: RESOURCES OF THE CARIBBEAN 29
4. Maynard Phelps: TECHNICAL "KNOW-HOW" VERSUS
FOREIGN INVESTMENT IN ECONOMIC DEVELOPMENT .55
5. Manuel A. Mesa: LATIN AMERICA LOOKS AT INTER-
AMERICAN TRADE 64
6. William R. Mizelle: THE UNITED STATES LOOKS AT
INTER-AMERICAN TRADE. 75


Part III-AGRICULTURAL PROBLEMS OF THE
CARIBBEAN AREA

7. Wilson Popenoe: PRoBLEMS OF FOOD AND OTHER CROP
mPUamTS tN TrE CARIBBEAN AREA 89







xii The Caribbean at Mid-Century
8. Manuel Elgueta: FUNDAMENTAL RESEARCH IN CARIBBEAN
AGRICULTURE AND THE ROLE OF THE UNITED STATES IN
ITS DEVELOPMENT 99
9. Ram6n Col6n-Torres: PROGRAMMING FOR THE UTILIZA-
TION OF AGRICULTURAL RESOURCES IN PUERTO RICO 111


Part IV-SOCIOLOGICAL AND ANTHROPOLOGICAL
PROBLEMS OF THE CARIBBEAN AREA

10. John Gillin: IS THERE A MODERN CARIBBEAN CULTURE? 129
11. Lowry Nelson: CUBAN PARADOXES . 136
12. J. M. Cruxent: VENEZUELA: A STRATEGIC CENTER FOR
CARIBBEAN ARCHEOLOGY. 149


Part V-POLITICAL AND HISTORICAL PROBLEMS
OF THE CARIBBEAN AREA

13. Silvio Zavala: THE CONTACT OF CULTURES IN THE
HISTORY OF MEXICO 159
14. J. Lloyd Mecham: AN APPRAISAL OF THE REVOLUTION IN
MEXICO 170
15. Lewis Hanke: ARBBEAN BBLmOGRAPHY 202


Part VI-LANGUAGE AND LITERATURE OF THE
CARIBBEAN AREA

16. Jorge Mafiach: LITERARY HOMOGENEITY IN THE
CARIBBEAN 213
17. John Armstrong Crow: AN INTERPRETATION OF CARIB-
BEAN SOCIETY THROUGH LITERATURE 216
18. German Arciniegas: MAGIC IN THE CARIBBEAN 247
19. Jos6 Ant6nio Portuondo: CARIBBEAN LITERARY THEMES
IN THE LAST FIFTY YEARS 256

Appendix 271
Index 279












Introduction


I

THE Caribbean area! What visions are brought to mind when
the name is mentioned! For where else in the world can one find
such thrilling and exciting romance, so much mingled fact and
fancy, so many historical ghosts' The Caribbean was the first
focal point for Europe in America. It was the site of the first
European government in this Hemisphere. It was the scene of
stupendous feats of bravery, of fierce and bloody massacres, and of
the blackest crimes in the long story of man's inhumanity to man.
It was once peopled by natives who erected the highest civilization
in the continent while at the same time it was inhabited by some
of the most warlike cannibals known.
The Caribbean area is an historical stage upon which have
played some of the best and some of the worst actors in recorded
history. It was a mare clausum, the property of the Spanish Crown,
yet it could not be defended successfully against pirates, freebooters,
buccaneers, and the "legal" attacks from numerous nations of
Europe, some of which still maintain more or less precarious foot-
holds. It was partially conquered and settled within a generation
after Columbus' discovery, yet it has not been completely "civi-
lized" to the present day.
The Caribbean is a geographical unit which has never been
unified. It contains some of America's warmest lowlands and
some of the coldest uplands. It has some of the wettest tropical
regions and a few exceedingly dry areas. It has regions of produc-
tive abundance and areas of agricultural scarcity. In some places
there is pleasant prosperity while in others there is dismal poverty.
Overcrowding or underpopulation mark many regions. It has a
few good harbors and many poor ones. It includes numerous
islands, pbniasias, ad large land masses, and there are at least
seven possible it-ocean 'canal outes between the east and west
which might i'nen ; yet separate, the' adjacent regions.







xiv


The Caribbean at Mid-Century


The Caribbean area is populated today by representatives of the
white, red, black, and yellow races, with a few from the brown
race. These people speak innumerable dialects and many of the
languages of Europe and Asia. Their governments are among the
most democratic and the most dictatorial and despotic in the
Western Hemisphere.
The Caribbean area is truly a land of many contrasts as well as
of numerable similarities. It is a unit on the earth's surface held
together, yet separated, by the Caribbean Sea and the Gulf of
Mexico-first a "Spanish lake" and later an "American Mediter-
ranean." This is "Middle America." In no other portion of the
globe are there at present more numerous or more interesting prob-
lems than in this area.


II

For three centuries before 1800 the Caribbean was the chief
European door to America. Through this door in the early years
of European expansion came adventurers and traders bent on
taking away the riches of the new world. Spain attempted for three
hundred years to monopolize this vast wealth by excluding all
other powers from legal trade. But this effort only served to call
to the attention of covetous nations the importance of the area.
In consequence the British and the Dutch in various periods often
claimed as large a share of the goods and treasures of the Caribbean
as did Spain herself. Finally, near the end of the eighteenth cen-
tury, the Spanish government decided to recognize the cold facts
of reality and to throw open the region, together with her other
colonies in the new world, to the free trade of outsiders.
With the rise of the United States, our interest in the Caribbean
has increased with our territorial expansion and with our growing
international importance as a nation. In the early days of the last
century our statesmen, among them Thomas Jefferson and later
John Quincy Adams and Henry Clay, turned covetous eyes on the
area, but without gaining for us actual possessions. Even the slave
interests in the South from time to time cast hopeful glances at
the Caribbean lands as areas where slavery might be profitably
perpetuated if it should be abolished in the United States.






INTRODUCTION


During the Mexican War, "Manifest Destiny" became a watch-
word throughout the country, and our statesmen and adventurers
looked long and longingly on our immediate neighbors to the
south. On the supposition that Cuba was the "key to the Gulf,"
and that nearby islands were necessary to our peace, safety, and
prosperity, several of our presidents, as well as cabinet members
and Congress members, spoke and wrote with the common objective
of bestowing on the lands of the Caribbean the blessings of our
God-given civilization.
The war with Spain brought to a culmination nearly a century
of anxious longing for the area. As a result, the acquisition of
Puerto Rico in 1898 was followed by the forcing of the Platt
Amendment upon Cuba, by the control of Panamanian territory
for the Canal, by the collection of the customs of the Dominican
Republic, and by the sending of Marines into Nicaragua and later
into Haiti. These steps brought down upon the United States
justified and widespread criticism from Latin Americans, but this
did not lead us to modify the methods of Yankee Imperialism,
Dollar Diplomacy, and the Big Stick policy until the decade of the
nineteen-thirties. For a time the Monroe Doctrine was largely
restricted to the Caribbean area, especially in the mind of President
Coolidge, but the world had to wait for the Good Neighbor attitude
before breathing easier with regard to our Caribbean policy.
Despite the New Deal views concerning our relations to our
southern neighbors, conditions during the decade of the Depression
and the years of the Second World War afforded sufficient excuse
for the United States to develop new policies of economic ex-
pediency and strategic necessity so that once again the Caribbean
has become not only our inland sea but it is now virtually our front
door-step and a bastian of defense.
Thus during the past four and one-half centuries one type of
covetous exploitation after another has been applied to the region.
Little wealth has been taken into the area, but untold amounts
have been taken out, and today the peoples of the Caribbean are
probably very little better off economically, and possibly very little
happier, than were their forebears in previous centuries. Their
problems have changed chiefly in degree rather than in nature.
To understand these problems a brief analysis may be helpful.







xvi The Caribbean at Mid-Century
III

Caribbean economic problems are rooted in the facts of relative
global location and in regional geography. The thirteen Caribbean
countries, including Mexico, the six states of Central America, the
three states of the West Indies, Puerto Rico, and the two mainland
republics of Colombia and Venezuela, have a common water con-
nection in the Caribbean Sea. At first this factor tended to
separate them, but it was not long before it became a connecting
link between them all. Within the area moves the restless Gulf
Stream which has profoundly affected navigation, while blowing
over the region are the Trade Winds which have had a decided
influence not only on sailing ships but upon the health and social
activities of the peoples
Throughout all the countries bordering on this inland sea are
mountainous areas of cold or temperate climate as well as low-
lying regions of steaming torrid heat. In some regions volcanoes
are active, in all regions earthquakes are of frequent occurrence,
and everywhere tropical storms of hurricane velocity may strike
unexpectedly. No person is free from the climatic influence,
whether it be monotonous or varied, salubrious or unhealthful.
The ease of living in an almost changeless climate has made people
indolent and strengthened the Mafiana complex.
In this easy environment people have reproduced themselves
prodigiously but nature contrived to kill them off in even larger
numbers, at least for three centuries after the arrival of Columbus.
In the twentieth century a concerted attempt to improve living
conditions, both from within and without the area, gradually
brought about a reversal in population trends, and soon over-
crowding reduced elbowroom. A once plentiful food supply has
declined relatively and has failed to sustain the increasing families,
especially in the islands.
Health and sanitation programs, and agricultural and engineer-
ing development, have enabled more people to keep alive for more
years. More intensive land cultivation hence has become necessary
and variation in crops of an edible type has helped to raise living
standards. But with this betterment have come wage increases and
the cost of living has risen, so that few people are as well off as
before.







INTRODUCTION


xvii


For centuries the Caribbean Sea was almost a landlocked body
of water, a geographical cul de sac, which was entered only for the
purpose of exploitation. But with the opening of the Panama
Canal the region suddenly found itself in the path of the trade
of the world. To some extent this gave the region a new interest
in the eyes of European peoples, and it helped to give to the
people of the Caribbean lands a new concept of their world im-
portance. Certainly it made the people of the United States view
the area with greater interest, and it caused our capitalists to seek
opportunities to invest their funds in get-rich-quick enterprises. In
this they were encouraged by Caribbean political dictators, who,
before they were assassinated or overthrown, hoped to perpetuate
their names in economic and social good works and to exploit the
natural resources for their own financial benefit
The development of natural resources, especially oil, has brought
sudden prosperity to Venezuela and Mexico. The region has be-
come more and more an economic "colonial" area for the United
States as we have grown in importance as a world power. The
Caribbean area is now an economic door for the United States
through which pass Caribbean produce and United States men,
money, and machines, until the area has become flooded with
Yankee business men and technicians with special skills. This
conquest from the north was first controlled, determined, and di-
rected by the "Big Stick" policy and "Dollar Diplomacy" and by
the sending of United States Marines to protect the new United
States industrial culture taking root in the region and to teach the
people how to be honest in their political elections and how to
run their unstable governments. Hence much of the Caribbean
area became "Americanized" by United States business men who
were not above turning a fast dollar in dealings with corrupt gov-
ernments and unscrupulous dictators.
Many of the agricultural products of the Caribbean area were
originally introduced from the outside. Included among these are
sugar, bananas, rice, coffee, tobacco, cotton, and rubber. Some few
minerals have been exploited and in a few cases nearly exhausted.
But with the coming of the Second World War and the threat of a
third, some attempts have been made to add new "strategic" raw
products to this list.







xviii


The Caribbean at Mid-Century


Trade within the region is largely subordinated to trade with
outside areas, especially with the United States, which supplies
chiefly manufactured goods while receiving raw products and food-
stuffs. Various United States steamship companies have gained
carrying monopolies in the area, while airlines compete for the
tourist trade. In many of the countries interior transportation by
highway and railroad is often uneconomical and hazardous, or
even impossible, and the development of national economic life in
consequence has been retarded.
National wealth has been developed in the Caribbean countries,
but not without political repercussions and frequent national up-
heavals. A new age of "Manifest Destiny" for the United States
has arrived. The Caribbean nations now realize that their very
existence depends upon the whims of the great neighbor to the
north who is dividing and conquering them one by one with eco-
nomic pressures and exploitations. It has not taken these countries
long to conclude that they can not get along either with United
States' or without United States' markets and technology.
In some instances, governments have been unable to put their
own financial houses in order, and taxes are high, public funds are
misspent, and the cost of living is mounting. Foreign loans, chiefly
from the United States, are often wasted in graft and in elevating
the ego of the dictator in power, while such loans result chiefly in
increasing the public debt, which in many countries has often been
repudiated and in some instances has been in arrears for decades.
Yet each government appears eager to encourage the entrance of
foreign capital and to borrow sums from outside sources. A few,
with growing national self-reliance, are finally beginning to tug on
their economic bootstraps. Particularly is this true in Puerto Rico.
In most of the countries labor problems are virtually insoluble.
Almost everywhere labor is exploited by oppression, suppression,
and depression. Indian or Negro laborers or both are common
throughout the Caribbean, with the white man in most countries
owning the land and exploiting the worker. Labor unions in many
of the countries are either non-existent or of little national im-
portance, and each laborer must look out for himself and his family
as best he can. Fortunately several of the governments of the area
are coming to be more concerned with social welfare, and laborers
eventually should benefit from this new interest.







INTRODUCTION


The Second World War brought a new vista of economic pros-
perity to the Caribbean peoples when they were called upon by
the United States to aid in the war effort by developing and pro-
viding strategic materials. For their cooperation they were granted
gifts, loans, favored purchases, and trade agreements, which
eventually were to upset their national economies. In consequence,
at mid-century the Caribbean area is more than ever a region for
economic exploitation by the most powerful nation in the world.
The Truman Point-Four doctrine is bringing once again an influx
of United States business men and business dollars, with an in-
fluence both for good and for bad. At mid-century, however, the
Caribbean area seems on the verge of economic revolution which
also means political, social, and cultural revolution.
The long cycle of history is slowly turning in the Caribbean.
Who can predict the future? A new war will bring new economic
problems and new crises and perchance a whole new way of living
for a chosen few of the region. But for millions life will go on
much as it has in the past half-century.


IV

Caribbean social problems are rooted in geographical factors
and in racial mixtures. The Caribbean area is one of the chief
melting pots of the world, for in this region are found all the races
of mankind. Certainly here, if anywhere in Latin America, exists
the "Cosmic Race" so well described by Jos6 Vasconcelos of Mex-
ico. Here are assembled intermixtures of all colors and all types to
form blended physiognomies and confused character traits. In all
the countries individuals representing one of the mixtures or one
of the pure groups may serve-indeed have served-in prominent
political, social, cultural, and economic positions. But the class
system has not yet degenerated into the caste system, and inter-
marriage is not usually frowned upon except by outsiders.
Generally the Cosmic Race is carefree and convivial, impetuous
and improvident, living from day to day, and looking forward to
maiiana, which never comes, as the time for all accomplishments.
Interests in life are for the moment, and objectives are to be







xx The Caribbean at Mid-Century
gained chiefly if they carry with them social prestige or political
pre-eminence. Ambition is momentary and transient. Under such
circumstances it is not surprising that natives of the Caribbean are
content to allow the outsider to exploit the natural resources and
to carry away the natural wealth.
Some of the attributes just described are in part the result of an
environment which works havoc with health. Among the diseases
which have been both endemic and epidemic are yellow fever,
malaria, hook worm, dysentery, tuberculosis, and syphilis. Besides,
faulty diet among the families along the margin of subsistence
keeps thousands in a state of undernourishment and physical weak-
ness. Everywhere in rural districts there are too few doctors and
nurses, not to mention a lack of hospital facilities. An inevitable
result of this condition is a medical superstition bordering on
witchcraft.

V

Caribbean intellectual problems are rooted in a colonial-like
conscience and in religious superstition. From the earliest days of
the Spanish conquest intellectual life was controlled by the State
and the Church, often working at cross purposes with each other.
The rapidity of the Conquest made possible the rapid establish-
ment of some elementary schools for native children and of a few
schools of higher learning for whites. The Church from the very
beginning benevolently supervised the teaching of young and old
alike, chiefly in the more settled sections, while on the frontiers
the regular clergy, especially the Dominicans, the Franciscans, and
the Jesuits, supervised first the conversion and later the education
of the "wild" Indians of the mountains, valleys, plains, and
jungles. Everywhere, therefore, was spread the leaven of Catholic
Christianity, modified by the American environment. The State
and Church jointly supervised the building of missions, monasteries,
convents, and churches. This control reached even to architecture,
sculpture, and painting, and to the levying and collecting of taxes
for religious purposes. All human activities came to be controlled
and supervised by the State and the Church. Toward this end,
the Index and the Inquisition were mildly enforced in the Spanish







INTRODUCTION Xxi
colonies, and school curricula were shaped for the greater glory
of God and King.
But to the Caribbean, during the long centuries of colonial
supervision, came frequently the breath of European philosophies
brought deliberately by the Protestant privateers of England and
Holland and free-thinkers from France. Reaction to colonial
teachings of religion and politics was inevitable, and in many
regions of the Caribbean old traditions of thought were replaced
by the new learning from abroad. Sometimes this reaction was in
the form of bloody revolutions but sometimes it took the milder
form of religious and intellectual scepticism. As the nineteenth
century progressed, free-thinking developed in some localities into
almost a fetish, especially among self-styled intellectual leaders.
And while the masses of the people were little affected, the small
minority, as so often happens, pursued their puerile principles to
a place where they could not turn back. When the intellectuals
had arrived at this stage in their emotional thinking they were
ready to tinker with the educational systems and to force their
theories upon their contemporaries.
But no matter what changes might occur in the educational
institutions and in the minds of the leaders, the great majority of
the people were forgotten, and, except in Mexico, no one arose to
champion their cause. Thus illiteracy, which had existed in the
colonial period, diminished very little in the nineteenth century.
Today, of all Latin America, the Caribbean area has both the
highest percentage of illiteracy and the lowest percentage, the
former represented in the Negro republic of Haiti and the latter
in the largely white republic of Costa Rica. ,,
Many of the individual leaders of Caribbean intellectual life
have won wide fame for their literary productions in the field of
poetry, prose, and the drama. Others have turned their energies
toward music or to the arts. Few in number, however, are the
scientific leaders of the region But education has not always been
an unmixed blessing. Today many intellectuals of the Caribbean
are living in exile because, owing to the nature of their political
writings, they fear for their lives, or because they believe that the
intellectual climate of the area is not conducive to their own
particular brand of thought.







xxii


The Caribbean at Mid-Century


VI

Caribbean culture is rooted in personalism (personalismo) and
in the non-religious missionary-martyr complex. During the last
two generations Caribbean area culture has undergone numerous
changes. The Mexican Revolution following 1910 brought to
Mexico a change in economic and social thinking which, spreading
to the other countries of the Caribbean area, soon brought a leaven
of new attitudes toward life. "Indianism" of the mainland con-
tained ideologies which were applicable to the Negro and mixed
populations of the islands. Man, as man, became a new concept
once long forgotten and lost to sight through the long centuries of
colonial exploitation.
Man's new dignity was expressed in the literature of the region.
Some of the writing, prose and poetry alike, was revolutionary and
inflammatory and appeared in the form of periodical articles, in-
numerable pamphlets, and many books. Writers of every social
and political color (and racial as well) sprang into the intellectual
breach which was opened by the new social thought. Man's lot
should be improved all agreed-but "how" was the question. A
study of this literature today discloses the cultural "pulse" of the
people of yesterday.
In art, too, the new thinking and the new freedom were disclosed.
The "native" arts, as seen in Mexican murals (by no means new
to Mexico) surged up from below, and new national interest and
national pride in this form of national expression developed. Haiti,
particularly, brought to a culmination its artistic expression in its
1950 bicentenary, which commemorated the two hundredth anni-
versary of the founding of Port-au-Prince, while Colombia pointed
with pride to its early Indian culture as represented in its Chibcha
stone artifacts and superb gold ornaments. Guatemala and other
Central American countries began to emphasize their native Indian
arts for the benefit of the tourist who with his dollar greatly helped
to give stimulus to nativism.
Music, always an expression of Caribbean culture, found new
adherents in dance halls and music halls throughout the continent.
From the gentle Indian harmonies, through the rhythmic Negro
melodies, to the lilting pseudosophisticated Calipso songs, artistic







INTRODUCTION


XXinl


expression moved from the country to the city and out of the area
to world musical centers.
With all this recrudescence of soul-expression there developed a
new philosophy of living and thinking, often a substitute for ortho-
dox religion, but generally a visible striving for something unattain-
able by the masses through direct political or economic action.
Some of this philosophical thinking resulted from the concept of
the "Cosmic Race." The people of the Caribbean area became
aware of a color difference and then of a "color line" as conceived
by tourists from the United States. The presence of the Chinese,
especially in Cuba and other islands, rather than the presence of
the Negro, brought a sudden awareness for the first time of racial
differences. In Panama, the racial as well as the cultural crossroad
of the Caribbean area, individual differences of color came to be
looked upon with new interest and criticism.
But the new philosophy had not only a disturbing influence-it
also had a quieting influence, and a reconciliation of disturbing
factors has generally ameliorated criticism and any fears which
may exist regarding the future of the Caribbean race. In this
process new vistas and insight into future life have been opened to
Caribbean eyes.
Culture is an evolutionary wheel, slower than political revolution,
but even more fundamental. At mid-century the Caribbean area
seemed to be in the midst of a cultural cycle, sparked by philo-
sophical unrest and guided by a desire to become attuned to the
cultural trends in the United States. The history of the next half-
century should disclose many important and interesting changes in
Caribbean life which cannot be seen clearly today.


VII

Caribbean political problems are rooted in historical precedent
and in human expediency. Everywhere in the Caribbean are found
the tradition and the habit of one-man government. As far back
as one cares to look in their panorama of history, the inhabitants
of the area can see predominant precedent for such a condition.
In the Iberian peninsula there is the vista of Roman emperors,
Moorish califs, Germanic kings, and Spanish sovereigns, while in







xxiv


The Caribbean at Mid-Century


the new world, there lies along the road of the past the tradition
of American Indian caciques and African Negro chieftains. The
white man brought the viceroy to America and thus joined the past
with the present. The political revolutions for independence from
Spain early in the nineteenth century led to the illogical establish-
ment of republics, which in some instances became more monarchi-
cal than republican, and which finally led to the establishment
in every country at one time or another of dictatorships. Thus the
political cycle of one-man governments was completed after a
brief hiatus of democracy.
It is true, of course, that dictatorships are not always "bad" for
a country. But in too many instances the constitutions have first
been violated and then abolished, only to be replaced with other
political instruments which have in turn been overthrown, perhaps
by bloody revolution. Certainly the countries of the Caribbean
area have produced more than their share of the total number of
constitutions prepared by the peoples of Latin America.
While democracies exist, on paper at least, in each of these
states, corruption corrodes the political framework of many of the
governments, and voting, though secret by law, becomes a means
of enriching private coffers or of achieving political prestige for
which no qualifications exist. Popular government in the United
States sense of the term has yet to be effected in much of the area.


VIII

Into this region of perplexing problems in recent years have
come United States capitalists and industrialists, diplomats and
tourists, none of whom have accomplished much to aid in solving
the problems of the area. More often than not, these visitors have
had a disturbing influence and have, therefore, complicated the
problems which already exist. At long last, however, it should be
apparent that reforms from within cannot alone be expected to
solve the complicated issues of the region. Only with a sympathetic
understanding of the problems of the Caribbean area can they be
solved. In any case these problems present a challenge to our gov-
ernment and to our people which we, in this critical time in world
history, cannot afford to overlook. Perhaps in the Caribbean area







INTRODUCTION XXV
we can perform a service in helpful cooperation which will make
the world long remember that the Good Neighbor policy of the
United States was something more than a facile phrase composed
by harassed statesmen as a means of solving our own pressing prob-
lems of national depression and continental security.
Because the state of Florida is virtually a physical part of the
Caribbean area, an analysis of its problems-political, economic,
social, religious, educational, and cultural-by a conference of
experts at the University of Florida is eminently logical. Hence,
this symposium on the "Caribbean at Mid-Century" properly
displays an understanding of trends, factors, and conditions which
have long been at work to shape the area's destiny. Such a study
points the way to solutions which, if put into effect, may lead to
better living in this part of America. Subsequent conferences deal-
ing with this region will attempt to analyze factors, seek causes,
and suggest remedies pertaining to the Caribbean area.

A. CURTIS WILGUS, Director
School of Inter-American Studies









Part I




INTER-AMERICAN RELATIONS OF THE
CARIBBEAN AREA












1





Edward G. Miller, Jr.: INTER-AMERICAN
RELATIONS AT MID-CENTURY




I WAS invited by your President to appear before you today pre-
sumably because I could make a contribution to your deliberations.
From my point of view, however, there is a different value. We
in Washington rarely have the opportunity to detach ourselves
from the daily schedule of appointments and meetings, from the
masses of detail. In the course of time this puts us increasingly in
danger of losing the long-range vision that alone can keep our
policy moving toward the established objectives of the American
people. Too often the people of our country and we in govern-
ment tend to think in terms of the daily headlines. We fail to
differentiate between the short-term aspects of an event or of a
policy and the long-range objectives towards which we should be
moving. Too often we take the superficial view, we use the catch
phrase, we personalize issues, we paint them in- terms of absolute
black or white. We often fail to remember that, in many of our
complex situations of today, policy and decisions are shaped by
all sorts of factors, and we must bear in mind the interrelation
between events on the one hand and human wills on the other.
I am grateful, therefore, to be able to meet with you here in
this atmosphere of detachment. It is you, as students and thinkers,
who enjoy a comprehensive view of our affairs. It is you who are
in the best position to estimate the current developments of our
international relations in terms of their historic significance. It
is you, therefore, to whom officials like myself must repeatedly
turn for objective guidance.







2 The Caribbean at Mid-Century
I

Falling into the spirit of the occasion, I have chosen as my topic
"Inter-American Relations at Mid-Century." We take the year
1950 as a pinnacle from which to survey the entire century, with
the altogether unprecedented changes that it is impressing upon
us all.
Perhaps the chief surprise that this view contains for me is the
discovery that the 1930's in our inter-American relations are al-
ready a part of history--so much has happened since.
We have, here, a paradox; for no essential change has, in fact,
occurred since the 1930's with respect to our inter-American rela-
tions in themselves. The course on which we then embarked, in
pursuance of the "Good Neighbor Policy," is the course to which
we all hold today.
This stability in a world of change is one of the outstanding
facts that emerge from a survey of the century. It is among the
notable features of the relationships among the members of our
traditional inter-American community of states Instead of any-
thing new there is, rather, a continuing development and progress
year by year along the lines that were laid out almost a score of
years ago. The inter-American system becomes stronger with time.
The practices of its members in the fields of international and
domestic democracy show the gains in our experience and the
persistence of our basic drives. But there is nothing essentially new.
And yet, all has changed. In spite of the remarkable continuity
of inter-American affairs that runs from the early 1930's up to
this point of mid-century, the 1930's themselves now belong to
another age. The change that has brought this about is not a
change within our regional community but a vast transformation
of the world at large, a transformation in the outer environment
to which our community of American states must maintain its
adjustment.
Look at what has happened. In the 1930's this "New World"
of ours still cherished its detachment from the ancient rivalries
that kept the "Old World" in a state of incipient flames and
chaos. The symbol of our isolationism in this country was the
memory of our Pilgrim ancestors, who had escaped from the sordid
embroilments of feudal Europe and crossed the wide ocean to







INTER-AMERICAN RELATIONS


sow, here in this "New World," the seeds of a new beginning. It
is almost incredible to reflect that only fifteen years ago the Senate
of the United States rejected a proposal that we join the Interna-
tional Court of Justice, an institution which today we participate
in as if it were the most natural thing in the world. Another mani-
festation of the ostrich-like philosophy of dealing with problems
by not recognizing them was the enactment of the Neutrality Act
of 1937. Even within the Department of State this attitude mani-
fested itself by the use throughout the last war of the file notation
"European War-1939" in describing the greatest world conflagra-
tion of all times.
The sense of escape from the Old World which underlay this
philosophy and the feeling of a new opportunity for peace and
freedom were shared by all the American republics on the basis
of their common experience in gaining their political independence
of Europe. That was what provided the basis of our common
policy in the 1930's. We were determined to maintain a political
insularity, to secure ourselves behind oceanic barriers, to insulate
our common Hemisphere against contagion from an "Old World"
that appeared to be undergoing its death agony. That was the
purpose of our mutual association in the inter-American system.
No more poignant symbol of that purpose exists than the imagi-
nary line circumscribing our Hemisphere which the American
states declared, in the 1939 "Declaration of Panama," should stand
as a barrier excluding "any hostile act by any non-American
belligerent nation." But the waves of the Atlantic continued to
bear the traffic of war; just as they had, a thousand years earlier,
continued to lap the coast of Britain despite the gesture of King
Canute. Soon it was the warships and warplanes of the New
World that were crossing the sea to do battle in the Old. In def-
erence to the realities of a shrinking earth, the defense of the
Hemisphere was now established beyond the Panama line on the
beaches of Normandy. Today the defense of the Hemisphere is
being pursued positively in Berlin, in Vienna, in the Near East, in
South Asia, and on the fields of Korea.
This is the great revolution in the position of Hemisphere affairs
that has taken place since the 1930's. More than a century after
Canning delivered himself of his idle boast that he had "called
the New World into existence to redress the balance of the old"-







4 The Caribbean at Mid-Century
more than a century later the New World finally has, in fact,
undertaken to assume the burden of redressing that balance.
The old European balance of power was, in one sense, the
major casualty of World War II. Never before, not even when
the Ottoman Empire knocked at the gates of Vienna, did our civili-
zation face such an appalling prospect as confronted it in the
aftermath of the war. Western Europe lay temporarily prostrate
before a menace that exceeded the threat of Hitler and his gang,
against which we had just fought. The mighty Russian empire
with its traditional imperialistic ambitions was now in the hands
of a ruthless oligarchy bent on substituting its own unbridled will
for the laws of free men the world around. That oligarchy quickly
subverted and enslaved the nations of eastern Europe; it moved
on Iran and Turkey and Greece; it maneuvered for control in
France and Italy; it undertook to bring the uncaptured sectors of
Berlin to submission. What Hitler had failed to do seemed now on
the brink of rapid accomplishment by International Communism,
since the power necessary to effective resistance had been paralyzed
in western Europe by the effects of the war.
Little seemed to stand in the way of a quick Communist advance
to the Atlantic. Once Soviet Communism stood on the opposite
shore from us, the future of freedom in this New World of ours
would be precarious indeed. For then we would be truly isolated
from our captive allies and the captured elements of our strength
in Europe-isolated not by our decision and after the fashion of
our own choice, but by the guns pointed at us across the ocean
from what was no longer a friendly coast. This would be a new
and far more complete kind of isolation than our own old isola-
tionism had ever contemplated. The power of western Europe,
so far from being on our side, would now be mobilized by the
masters of the Kremlin and directed against us.
It was in this dire emergency that the New World stepped in
"to redress the balance of the old." Today we are in the very midst
of the effort to achieve this aim, and thereby to set our civilization
back on the road to the realization of our common democratic
ideals. We are in the midst of a heroic struggle of the entire free
world to close up the breaches in its defense, to reassemble its
strength, and to resume its progress.







INTER-AMERICAN RELATIONS


Let me repeat: the great change in our inter-American rela-
tions since the 1930's is that today the defense of our common
Hemisphere can no longer be secured by taking passive positions
offshore. It can be secured only by positive, self-sacrificing action
on the front lines across the seas in the deadly struggle of today.



II

The passing of our isolation as a Hemisphere has been signified
in a more profound and permanent fashion by the active partici-
pation of all our countries in building and developing the United
Nations. We have all recognized that this kind of organization
must be developed on a world-wide basis so as to overcome inter-
national anarchy and join nations together in the drive for the
achievement of peace and freedom under law. The role of the
American states as a group has been far from incidental in the
formation of the United Nations. Some of its basic features have
a distinct inter-American cast. They represent ideals that have
been nurtured and experience that has been gained in the develop-
ment of our own regional community.
The basic significance for the Hemisphere, however, is what I
am concerned with here. If, through the machinery of the United
Nations, one of the smaller American states plays a positive role
in the resolution of a local conflict in, say, South Asia, it is because
that local conflict has its eventual bearing on the security of that
country and of the Hemisphere.
If our inter-American system has had its impact on the United
Nations, it is also true that the United Nations has had a decided
impact on our inter-American system, which has become a regional
organization within the terms of the United Nations Charter. The
charter of the Organization of American States, drawn up at
Bogota in 1948, nearly reflects in its design the architecture of the
United Nations. Although this Organization of American States
represents a continuing development of the inter-American system
which goes back into the last century, it has also acquired a dif-
ference simply by virtue of the existence of the United Nations.
Again, the impact of the environment has been decisive.







6 The Caribbean at Mid-Century

111

One of the appealing features of the historical approach to our
international affairs is the way it dissipates from our view all the
confusions that cloud the immediate course of events. As we look
more closely at the present and the immediate future, however, we
cannot entirely avoid these confusions.
One of the most effective arguments occasionally advanced
against our foreign aid programs, for example, has been the need
of our own people at home. Some persons have asked why we
should spend public funds to cooperate with some distant country
in the rehabilitation of its agriculture when those same funds could
usefully be added to those being spent on farms within our own
borders. Or why should we spend our dollars for public health in
Greece when we have public health needs right here at home?
The people of the United States have shown that they under-
stand what the answer to this is. In a nutshell: if you confine
yourself to repairing the roof on your own house while your neigh-
bor's house is on fire, you may find you have no roof to repair.
A similar argument has been persistently advanced regarding the
needs of our neighbors here in our own Hemisphere. The dire
severity of those needs, in many cases, is incontestable. The other
American states are united to us by traditional bonds of intimacy
and close cooperation. They are our fellow Americans, and we
acknowledged a mutual responsibility for cooperation with them
long before we assumed any like degree of responsibility with re-
spect to countries overseas. Why, therefore, should not the billions
of dollars we are spending to redress the balance in Europe and
the Near East be added, instead, to what we spend on cooperation
to meet the needs of our neighbors in the Hemisphere?
The answer again is the same as in the case of our own country.
The security of our common Hemisphere against the looming
threat of Russian aggression is a necessary precondition to the
realization, within the Hemisphere, of our aspirations for a better
life for everyone.
Let me make this quite clear. What is at stake in the defense of
the free world is the freedom of men to solve their own problems
by the exercise of their own free will. It is of more immediate im-
portance to preserve that free will than to concentrate on the solu-







INTER-AMERICAN RELATIONS /
tion of the problems, because without that free will the problems
cannot be solved. The fruits of freedom depend on the ability to
exercise freedom. It would do none of our neighbors in the Hemi-
sphere any good, in the long run, if the United States diverted to
them the resources that, applied overseas, serve to maintain our
common independence. Dead men and slaves are in a poor po-
sition to improve their lot.
We are all in the same boat. Consequently, each of us has pre-
cisely the same stake in keeping it afloat and the same justifica-
tion for sacrifice.
The security of our Hemisphere is of uppermost concern to all
of us. This does not mean that the internal needs of our own
country or of the Hemisphere should be or can be disregarded.
The very growth and development of democracy in this Hemi-
sphere makes its own demands. As peoples succeed in realizing the
opportunities of freedom, as they emerge from ignorance and
ancient misery, as they gain a more commanding view of the world
and its possibilities, they are less than ever satisfied to endure the
lot that they had previously, perhaps, taken for granted. This is
all to the good if it stirs their leaders to increased action and to an
increased sense of public responsibility.
In point of fact, one of the distinct changes that has marked
inter-American relations in the past twenty years is precisely this
growing preoccupation of statesmanship in the Americas with im-
proving the lot of the masses of people throughout our countries
by means of economic and social development. The principle and
the practice of cooperation among the American states to this end
have become so well established that we find it possible to take
for granted today what would have seemed extraordinary a few
years ago.
The United States has participated wholeheartedly with the
other American states in the development of this kind of cooper-
ation, not only through the various agencies of the Organization
of American States, but also through the loan programs of the
Export-Import Bank and the International Bank, in which we
are the principal stockholder, in the extensive and far-reaching
programs of technical cooperation carried on by our own Institute
of Inter-American Affairs, and in the cooperative activities that
such government agencies as our Public Health Service and our







8 The Caribbean at Mid-Century
Department of Agriculture have for years now been carrying on
throughout the Hemisphere.
Looking backward over these developments, and looking forward
to their continuation, I am struck by one fact: this cooperation
for social and economic development has had a sort of haphazard
character in the past dozen years since its first effective beginnings.
Programs and projects without interrelationships among them have
often been taken up on an individual basis. The organization of
many of these activities into the new "Point Four" program, how-
ever, has promoted a strong tendency to bring them together in
such a way that they complement and mutually support one an-
other. I have no doubt that the future will see a greatly increased
effectiveness resulting from coordinated effort to achieve economic
development on a wide and varied front. We are giving expression,
in these matters, to one of the main historic drives of our century.
I should like, however, to leave a very clear distinction in your
minds. While international cooperation for the betterment of popu-
lar living conditions has become an established, normal procedure
of governments in the twentieth century, the kind of thing we have
been doing through the European Recovery Program (to take an
outstanding example) represents emergency action to re-establish
the strategic foundation of Hemisphere security in the face of an
immediately looming menace.


IV

These, then, are the conclusions that I draw from a survey of
our inter-American relations at mid-century. The twenty-one
American states have demonstrated the stability of their interna-
tional system. They have made persistent progress along the course
that they set for themselves in the early thirties. The great change
is in the world at large. That change has had the effect of finally
making it impossible for the New World to achieve its security by
isolation. Its security, today, must be achieved on the front lines
in Europe and Asia. It is with this end in view that the American
states have played a positive role in the creation and development
of the United Nations. It is with this end in view that the United







INTER-AMERICAN RELATIONS 9
States has thrown its resources into the struggle of the democracies
in the Old World to redress the balance against them.
At the same time, the American states have been strengthening
their cooperative efforts to improve the living conditions of their
own peoples. Assuming an eventual victory of the free world and
the consequent achievement of our Hemisphere's outward security,
this development holds the greatest promise for the second half
of our century, on which we now embark.













2





Harry F. Guggenheim: HEMISPHERE
INTEGRATION NOW





PRESIDENT MILLER has honored me with an invitation to
address you on a general subject in the relations between the
United States and Latin America. I chose for the specific subject
of my address, "Hemisphere Integration Now."
I shall attempt to convince you that a foreign policy for the
United States, which includes the political, economic, and military
integration of this Hemisphere, is essential to our well-being, and
possibly even our survival, as a free nation.

I

The integration of the Western Hemisphere now is not suggested
as a policy of "isolationism" or insulation from the rest of the
world, or as a substitute for the role that we should play, say, in
the North Atlantic Pact or the movement for a United Europe. It
is an anchor that we should let go now to windward, in the best
holding ground, before the storm breaks.
I speak as a citizen of the United States without office, and as
a seeker of truth. My thesis rests on the following premises:
1. War is bestial and inhuman. It is a curse on the people of
the world. There is, however, a greater curse, and that is national
enslavement, which is the danger from a lost war.
2. Nationalist Communism as presently practiced by the Polit-
buro of Soviet Russia is an international conspiracy to overthrow







HEMISPHERE INTEGRATION NOW


non-Communist governments throughout the world. Stalin rigidly
follows the policy of Lenin, who proclaimed: "We are living not
merely in a state but in a system of states, and the existence of the
Soviet Republic side by side with imperialist states for a long time
is unthinkable. One or the other must triumph in the end. And
before that end supervenes a series of frightful collisions between
the Soviet Republic and the bourgeois states will be inevitable."
Should Soviet Russia be successful in this conspiracy, sovereign
states will disappear under the dictatorship of Russia's Imperialist
Politburo.
3. The transition from the sea age of transportation to the air
age has now developed to a stage where all nations are susceptible
to attack and many to destruction from the air. As Hanson W.
Baldwin, of The New York Times, has said: "Frightful agents -of
destruction have conferred upon the offense a great and growing
lead over the defense, and have altered-particularly the coming
intercontinental and transworld missiles--all American strategic
concepts."
4. Neutrality is a luxury that weak states can only indulge in
with the approval of strong states. In recent times the tragic fate
of Belgium, Holland, and Denmark are such concise and clear
examples of frustrated neutrality that the multiplication of examples
seems unnecessary. Only the defeat of the Axis powers saved them
as sovereign states.
5. The United Nations and the Organization of American States
are aids, but not yet substitutes for foreign policy. They are organi-
zations for immediate consultation in international emergencies,
where action can be taken quickly against threats to the peace and
aggression. They are forums where foreign policy can be examined,
debated and developed, and where international harmony and
human well-being can with good will be promoted.
But until the strong have reached a state of enlightenment in
which they are willing to temper strength with reason and justice,
there can be little hope for substituting the United Nations and
Organization of American States for foreign policy. And surely
before justice becomes acceptable to the strong, they will require
assurance that justice will not be replaced by self-interest of the
numerically.greater votes of the weak.
Vishinsky, who has used the forum of the United Nations so







12 The Caribbean at Mid-Century
often to create ill rather than good will, has made quite clear the
power position of Russia. He has realistically called attention to
the fact that-veto, or no veto-the great powers now enjoy and
will continue to enjoy the power to break the peace.
Franklin D. Roosevelt warned us in 1939 that our frontiers were
on the Rhine. Europe still may be our first line of defense, but this
Hemisphere is our last line of defense. It is our inner citadel, and
it must be made impregnable.
The age of the air has made this citadel vulnerable. In World
Wars I and II we succeeded in keeping the lands of this Hemi-
sphere free from attack. That was only because we were in a tran-
sition period from the sea age to the air age.
Now we can no longer expect to keep this Hemisphere from
assault by air. We must prepare for its defense now before it is
too late. We cannot do so by sketchy, or even by elaborate, plans
for action in case war is brought to us. We should not wait for
some military disaster to galvanize the Inter-American Defense
Board into action.
The present lack of cohesion of the American states is due, in
the first instance, to the isolationist foreign policy of the United
States in the past. This age-long policy was altered when the
United States entered World War I. After it, the disillusioned
people of the United States reaffirmed the general policy of iso-
lationism until World War II, even though, through the Good
Neighbor Policy, we recognized the common interests of this Hemi-
sphere. Since then, our foreign policy has made a complete re-
versal of course, and we are headed away from the territorial bor-
ders of the United States in every direction of the compass.
But, in our haste to accept world responsibility and assume world
leadership, we have neglected our nearest neighbors in the Amer-
icas. Isolationism has kept us from them in the past, and our new
foreign policy, which plummets us into Europe and Asia, keeps us
from them now.

11

Before elaborating on the proposal to integrate this Hemisphere,
it is essential to examine briefly the present over-all foreign policy
of the United States.







HEMISPHERE INTEGRATION NOW


In this examination, we should keep constantly before us our
objective-the objective of all foreign policy. The first purpose of
any such policy is to maintain our integrity as a sovereign power.
The second is, with enlightenment and consideration of others, to
promote our national interests. Survival is simple to understand,
since it is the first law of nature; but our "national interests," the
well-being and progress of 150 million people, are sometimes dif-
ficult to assess.
What is the new foreign policy that has been developing since
the close of World War II? It is vague, confusing, and headed in
three different directions at the same time:
1. We are attempting to assume, in a measure, the old role of
Great Britain in maintaining the balance of power in Europe and
in the protection of British trade routes in the Mediterranean and
Near East. The dearest example of this comes from Greece. "Early
in 1947," we are informed by Foster Dulles, the British Government
"privately told our government that it felt unable to go on alone
in Greece; that, unless the United States was prepared to help out,
it would withdraw, with the probable result that Greece would
fall, Turkey would be encircled, and the entire Eastern Mediter-
ranean and Near East would fall under Soviet Communist domi-
nation." We stepped into the breach and the British moved out.
2. The second course of our foreign policy flowed from the first.
When we assumed Great Britain's place in Greece, President Tru-
man enunciated his doctrine in which he said, in part: "I believe
it must be the policy of the United States to support free peoples
who are resisting attempted subjugation by armed minorities or by
outside pressures...."
This is the policy of containing Russia. It was defined by George
F. Kennan, of the American Foreign Service, in a lecture at the
National War College in January, 1947. He considered Russia's
political action as "a fluid stream which moves constantly wher-
ever it is permitted to move. If it finds unassailable barriers in its
path, it accepts these philosophically and accommodates itself to
them .... Soviet pressure against the free institutions of the West-
ern World is something that can be contained by the adroit and
vigilant application of counter force."
3. There is a third part of our foreign policy which Edgar
Mowrer has called the "moralistic fallacy." "This is the belief,"







14 The Caribbean at Mid-Century
he says, "that in its dealings with foreign states or groups, the
United States should be guided by the degree to which said states
or groups conform internally to American standards." In other
words, we are attempting to reform the world. Mowrer, describing
how it worked in China, came to the conclusion that our diplo-
mats were more eager to promote what they called "the revolt of
Asia" than to secure a China impervious to Russian influence.
The first part of our foreign policy, an attempt to maintain the
balance of power in Europe, is logical.
We abandoned isolationism as a policy just before World War
II because we feared that the Axis powers would succeed in subju-
gating the whole world. We preferred to fight on foreign soil
rather than at home. We accepted the concept of the air age that
our defense frontiers had moved from the Atlantic and Pacific
coasts to the Rhine, North Africa, and Okinawa. So today, with
our frontiers still on the Rhine, the balance of power in Europe is
of vital importance to us.
The North Atlantic Pact, and the movement for a United
Europe, stand in the way of Russian aggression. The United States
has taken the leadership in the North Atlantic Pact. It is un-
fortunate, in my opinion, that this leadership is not where it tra-
ditionally belongs-with England and France. We can only help
Europe; we cannot save her from Russian ideology or force. If
Europe no longer has the will to make desperate and supreme ef-
forts to preserve the essential freedoms the democratic world has
cherished, she will succumb to the tyrants of Russia, no matter
what we may try to do.
In 1951, we shall perhaps find out whether western Europe is
willing and able to make available the necessary manpower. There
are disturbing rumors that many Europeans are succumbing to the
false propaganda that the present world crisis is a battle between
Russian and United States imperialism. How pleasant it would
be to remain neutral, they think. But neutrality, in the air age, is
utterly impossible.
The second part of our foreign policy is the Truman Doctrine-
which is physically and financially beyond our abilities, and morally
wrong in its implied righteousness. Words such as "free peoples,"
"attempted subjugation," and "outside pressures" can be inter-
preted however the President sees fit, and this is a very grave







HEMISPHERE INTEGRATION NOW


danger. We Americans have proven beyond cavil our willingness
to help weak or distressed nations, but the Truman Doctrine com-
mits us to a world-wide policy of assistance, financial or military,
on a scale we cannot possibly support.
The third course of our foreign policy, in which we require
other states to conform to United States standards if they would
have relations with us, is inevitably doomed to failure in the future
as it has so notably failed in the past in dealing with such diverse
ideologies as those of Spain, the Argentine, Guatemala, and China.
The reduction ad absurdum of this doctrine would be to have no
relations with any states unwilling to reform themselves in our own
image of white, male, Anglo-Saxon democratic Protestant perfec-
tion.
As national interests are a basic consideration in foreign policy,
we must determine where they lie.
There is a lack of understanding of our long-distance economic
goals. We drift into situations and international political crises
which may be quite contrary to our national interests. For example,
during the crisis between Arabs and Jews over Israel, our policy
shifted from quarter to quarter like a weathervane in a storm. At
that time, the public had an intimation for the first time that oil
in the Middle East was one of the considerations of our foreign
policy. How vital are these oil fields to us? Is a keystone of our
foreign policy to prevent Russia's access to the oil reserves of the
Middle East? If such a policy is necessary to our survival and
national interests, and within the power of our resources, the pub-
lic should be informed and made ready to approve such a policy.
If this is to be a part of our foreign policy, let it be clear-cut; not
involved, confused, and hindered by other actions, unless they are
useful to our objective. Britain's success in her period of growth
was greatly aided by her clear knowledge of what she wanted, and
often by her quite frank methods of achieving it. Obviously, the
interests that Britain had in the protection of trade routes in the
Mediterranean and Near East are not identical with ours. Great
Britain's culture, power, and fabulous riches followed her policy
in that direction. But the United States may only exhaust her
strength and resources in the protection of interests that are of
little or no value to her.
We no longer believe that our national interests can best be







16 The Caribbean at Mid-Century
served by an overbearing, selfish nationalism. In the principle of
Point Four, President Truman has proposed a plan for us to help
less advanced nations to increase their productivity and well-being.
Enlightened self-interest should urge the implementation of
Point Four, but only with careful planning and under adequate
safeguards. Are resources for this purpose to be prodigally ex-
pended for all peoples over the earth who need our aid? Obviously,
even our great wealth could not stand such a strain. Yet at the
present time, Point Four is an instrument of the Department of
State, to be bartered for day-to-day diplomatic needs.
Our foreign policy is muddled because our national interests
are obscure. Furthermore, while we are committing ourselves to
financial and military aid all over the world, we do not know
whether our resources are great enough for our commitments
What we require is a new, bipartisan agency composed of the
executive and legislative branches of government, coordinated with
the State Department, to carry on a continuous appraisal of our
national interests and national resources. Instead, in this time of
crisis, we are staggering along with fifty-nine major Government
departments and agencies, of which forty-six have interests in the
field of foreign affairs. There are thirty-two interdepartmental
committees coordinating work. It is an impossible and unworkable
arrangement.
Minus some over-all coordinating body, our foreign policy is
bound to remain unrealistic and illogical. At a moment in history
when the United States must undertake, through foreign policy,
to lead the world away from wars toward peace, we have not set
a course that even our own people can follow with understanding
and approval.

III

The United States has a last line of defense in this Hemisphere
to which she will be forced back if our first line of defense in
Europe fails. This line consists of our neighboring American
states.
To disregard this line of defense and neglect the Americas may
be our greatest national folly. Neglect can be traced in the past,
as mentioned before, to our old traditional policy of isolationism,







HEMISPHERE INTEGRATION NOW


and since World War II to the lack of a comprehensive truly
American foreign policy to take the place of isolationism.
Perhaps lack of consideration of the defense of this Hemisphere
is also partly due to the past teachings of geopoliticians, of whom
Professor Spykman, writing in the midst of World War II, was a
leading exponent. He concluded:

South America beyond the Equator can be reached only by sea.
This applies not only to the United States but also to the republics
of Colombia and Venezuela, which lack adequate land communi-
cation with their southern neighbors The main area of the
southern continent will continue to function in American foreign
policy not in terms of a continental neighbor but in terms of over-
seas territory.

The airplane has already almost broken down this barrier. There
is little doubt that it will soon be completely eliminated, and with
it this misconception of what direction our foreign policy ought to
take.
So let us examine our foreign policy in Latin America now, with
the object of improving it for the greater security and national
interests of the United States and all of the other states in this
Hemisphere.
Our policy toward Latin America has been uncertain and vacil-
lating. We have gone through periods of Manifest Destiny, Im-
perialism, The Big Stick, Dollar Diplomacy, a Tutorial Policy, and
an Intervention Policy. Finally, under President Hoover a non-
intervention policy was practiced which Franklin D. Roosevelt put
into words, expanded, and sold as the Good Neighbor Policy. The
present administration adheres to the letter of the Good Neighbor
Policy, but has no kinship with it in spirit. There is an apathy to-
ward Latin America. As a result, we no longer enjoy the warm
relationships built up during the administration of Franklin D.
Roosevelt.
What course should our policy in Latin America take? I repeat
that it should be directed toward the most complete political, eco-
nomic, and military integration among all the states in this Hemi-
sphere that can be effected by diplomacy. We should make this our
cornerstone of foreign policy, because this Hemisphere is our last
line of defense, and within it are deep national interests which
have been neglected. Those far-off fields of Europe have seemed







18 The Caribbean at Mid-Century
so much greener that we have overlooked the ones at home, close
to our sight.
Latin America is an undeveloped and excellent area for essential
industry. It is our only source of many strategic and critical ma-
terials. Of the twelve materials listed as strategic in 1943, eleven
-copper, manganese, chromium, tungsten, tin, antimony, platinum,
mercury, iodine, sodium nitrate, and bauxite-are available in
Latin America. In addition, Latin America also produces oil, iron
ore, fibres, foodstuffs, drugs, woods, natural rubber, meats, hides,
and wool.
The volume of our trade with Latin America is indicated by one
very revealing set of figures: From July 1, 1940, to July 1, 1945,
non-military agencies of the United States Government purchased
$2,360,000,000 in commodities from Latin America out of a total
of $4,387,000,000 spent for commodities throughout the world.
Since the last war, more than one-third of our merchandise imports
have come from Latin America.
The population of the United States will reach its peak about
1970 according to students of population trends. Latin America,
with a present population equal to our own, will still be growing
in 1970. It may well outgrow the Russians, particularly if we are
able, by the right sort of assistance, to raise Latin American stand-
ards of public health to match our own.
Potential industry, population, strategic materials, and food are
all here in our own Hemisphere, for the survival of all of us, if we
have the wit and the will to use them. Up to now, unfortunately,
we have not shown an evidence of such acumen.
Take the case of Chile, one of many such. Between April, 1948,
and July, 1950, we spent about ten billion dollars under the Mar-
shall Plan to save western Europe from Communism. Meanwhile,
what is happening in Latin America? S. Cole Blasier, writing in
the Political Science Quarterly for September, 1950, says:

Since the formation of the Chilean Popular Front in 1936, the
Communists have played a crucial role in the political life of Chile.
Communists have come closer there than anywhere else in the
Western Hemisphere to controlling a national government.

Chile produces copper and sodium nitrate in quantity-both vital
strategic materials. She has almost 30 per cent of the world's







HEMISPHERE INTEGRATION NOW 19
copper reserves, and produces approximately 8 per cent of the
nitrogen consumed by the world in the form of sodium nitrate.
In view of her importance to us, what has our diplomatic policy
been toward Chile? Regrettably, one of friendly apathy--just as
it has toward the rest of Latin America. Yet Chile, right now,
like much of the world, is suffering from the destroying germ of
inflation. Like so many other countries in Latin America, her social
soil is fertile for Communist infiltration. Must our foreign policy
only be formed when an emergency arises in an attempt to save
us from imminent peril? Can we not continuously so conduct our
foreign affairs as to prevent disaster?
The responsible heads of the Chilean State are aware of the
menace of Communism. The people, if informed, can be relied on
to resist it. But the Communists are skillful. They rely on eco-
nomic distress and on American indifference to help them get
their way. If we let Chile lapse into confusion through our own
neglectfulness, then it is possible that Communists could take over
the state. If Chile should then agree to send her copper and
nitrates to Russia by commercial treaty, what would be the policy
of our Department of State? We must never allow ourselves to be
confronted by such a dilemma. We must bind Chile and all Latin
American countries so closely to us that Communism will cease to
be a threat.
We need sugar from Cuba, oil and iron ore from Venezuela,
coffee from Brazil, tin and tungsten from Bolivia, copper, lead, and
zinc from Mexico, hides and tungsten from the Argentine, va-
nadium from Peru, and platinum from Colombia. In emergencies,
we may have to rely on Latin America for rubber, hemp, cocoa,
tung oil, and quinine.
How can we implement the integration of this Hemisphere? To
begin with, we must have a different state of mind. We should
desire it, because we require it. The world has become a disturbing
and grim place to live in. There is hope, and perhaps even happi-
ness and example for the world, in this proposed regional alliance
of the peoples of this Hemisphere.
The United States can, in my opinion, bring about integration
in three ways: by diplomacy, economic union, and military al-
liances.
First, by diplomacy: We must acknowledge the importance of







20 The Caribbean at Mid-Century
good relations between the United States and the other states
within this Hemisphere. The Division of Latin American Affairs
within our Department of State should be raised in dignity and
expanded in organization, to cope with the diverse problems so
vital to all the Americas.
Our diplomacy in Latin America requires the highest degree of
personal representation in our various missions. In the past, in
numerous instances, it has been disgracefully poor We have been
represented by men unqualified to carry out their assignments, often
unable to speak the language of the country to which they have
been accredited. They have sometimes been chosen from private
life wholly because of some financial contribution or at other times
for some political contribution to the party in power. Before the
end of World War II they were often inefficient foreign service
officers, shunted into some Latin American state to get them out
of the way. They have sometimes been ignorant and futile men.
They have often been completely lacking in the culture, personal
sympathy, and understanding so necessary in our relations with
sensitive peoples sprung from Latin civilization. On the other
hand, there has been progress in recent years, and we have also
been represented and are being represented by men of the greatest
distinction and competence in the foreign service. However, to
accomplish our great aims now in this Hemisphere, we must sweep
the Embassies and Legations in Latin America clean of misfits and
incompetents.
Our diplomacy in Latin America should be rigidly directed to
respect the sovereignty of all the states of this Hemisphere. Sov-
ereignty can be respected only by strict adherence to the policy of
non-intervention, including direct action or intrigue.
On September 12, 1950, there were reported two examples of
United States intervention by meddling in distantly separated parts
of the world. One United States envoy at Teheran openly
preached land reform. Another publicly spoke in Montevideo on
the American way of life and denounced the Third Position of
Per6n. Both of these meddling incidents took place during na-
tional election campaigns.
The internal affairs of the recognized sovereign states of this
Hemisphere may be the cause of regret on the part of the United
States, but they should never be the cause of intervention. Our







HEMISPHERE INTEGRATION NOW


"policy of non-intervention" in Latin America must not be under-
mined by the traditional American desire to reform.
Finally, in our diplomacy, we should return to our ancient policy
of recognition of sovereign states with absolute impartiality, not as
a weapon to force reform. According to that policy, "(1) the new
regime must appear to have control of the governmental machinery
of state; (2) it must have the assent of the people without 'sub-
stantial resistance to its authority'; and (3) it must be in a position
to fulfill all its international obligations and responsibilities."
At the present time we are in the inconsistent position of carry-
ing on full diplomatic relations with Communist Russia, Socialist
England, and several dictators in Latin America-but we draw
the line at dictatorship in Spain. A short time ago we withheld
recognition of Per6n because we disapproved of his Third Position
in the Argentine. We have had ambassadors to the Argentine on
the one hand openly condemning, and others on the other hand
slyly approving the political philosophy of the President of that
sovereign state. This is not properly a function of a foreign am-
bassador. It is a form of intervention that should be banished
from our diplomacy in this Hemisphere.
The interpretation of the above policy on recognition allows
much room for discussion and disagreement. This is inevitable in
diplomatic relations. However, if the policy is consistently ad-
hered to in good faith, a pattern will eventually be woven which
those seeking truth will acknowledge as fair, even if the results
are not agreeable to everyone.
If we are not to intervene or meddle in the internal affairs of
the Latin American states, neither can we tolerate intervention in
this Hemisphere by outside states-the basic policy of the Monroe
Doctrine.
Russian intervention by intrigue to spread Communism should
be forestalled by rigid security measures and by the exchange of
information between the agencies of the various nations entrusted
with the task of maintaining domestic tranquility. We may dislike
Socialism, or Dictatorships, or the Third Position, but while they
remain political philosophies confined to the internal policies of
sovereign states, we should learn to live peacefully with them.
Second: We must bind together the economic resources of this
Hemisphere to protect all of us against military or economic ag-







22 The Caribbean at Mid-Century
gression. The hope of world free economies is not being realized.
On the contrary, there are increasing regional and international
preference agreements, cartels, exchange controls, export quotas,
and tariffs. We should be prepared and eager in this Hemisphere
to go as far as the rest of the world in breaking down all the bars
to a free economy. In fact, we should lead wherever possible, but
we must protect ourselves so long as restrictions are a part of the
world economic order.
Specifically I propose that the United States, by bilateral agree-
ments with other states of this Hemisphere and through tariff
adjustments, make possible now the sale of at least part of their
surplus exportable raw products and eventually all of the surplus
that we can consume.
The United States must re-examine its tariffs on the importa-
tion of raw products from this Hemisphere and make concessions
to further the end of Hemisphere integration.
We have made and are making outright gifts of colossal magni-
tude in the Eastern Hemisphere to strengthen our frontiers in
Europe. By reduction of tariffs on certain raw products from states
of this Hemisphere, we can strengthen our last line of defense. Of
course, some of these products will compete with our own. That
is a small price to pay, particularly since it will reduce our cost of
living and in the long run should greatly expand our exports to
the other states of this Hemisphere.
Since 1927 we have excluded Argentine beef from the United
States. This is one example among others of our inept policy in the
Argentine, and also of outstanding folly in Hemispheric policy.
While we refuse to purchase beef from the Argentine to protect
our cattle growers, we are giving billions of dollars annually to
Great Britain, among other things, to purchase most of her beef
from the Argentine. The good will which we feel we cannot afford
to buy from the Argentine, in order to protect our cattle raisers,
England purchases with our money. Thus it is plain that we need
a new approach to the economic problems of this Hemisphere.
We must not negotiate at arms length as strangers, but as part-
ners in a cause for common survival and well-being. Our objec-
tive should be to break down all trade barriers in this Hemisphere
so that, eventually, there will be the same free movement of goods
among the states of this Hemisphere as there now is among the







HEMISPHERE INTEGRATION NOW


states of the United States. This will require us to sacrifice some
vested interests; it will require some other states in the Hemisphere
to sacrifice some of the momentary advantages of a narrow national-
ism. In the greater interest of Hemispheric integration, we should
assist the industrialization of Latin America whenever it seems
economically sound.
I further propose that the capital of the Export-Import Bank
be increased so that economically sound enterprises in this Hemi-
sphere can be stimulated and expanded. Here again is indicated
the need of an agency of government able to appraise our over-
all, long-range national interests and point out to what extent
enterprise should be stimulated in this Hemisphere or elsewhere.
The proposed action toward economic integration on the part
of the United States would help to stabilize the economy of Latin
America. It would help to destroy the germ of inflation and curb
the spread of Communism. It would provide the first articles for
a partnership of the Americas through a real community of
interests.
Where we have failed by full-dress conferences, innocuous po-
litical treaties, cultural interchanges, and uncertain and intermit-
tent financial and technical aid, we can succeed by solving the
basic economic problems of Latin America at slight immediate
sacrifice and with much eventual benefit for the United States. It
might well be the initial step leading in the distant future to a
United States of the Americas, and beyond that to the far-off hope
of World Government.
Third: We must forge the most comprehensive kind of military
alliance for the protection of the countries of this Hemisphere.
Results from our foreign policy in the Eastern Hemisphere, carried
on at colossal sacrifice, are still uncertain. But leadership in a new
foreign policy for the Western Hemisphere can achieve success at
comparatively little sacrifice.
The experience of World War II should be a clear indication
of our need for action while there is still time to take action. Fol-
lowing the attack on Pearl Harbor, the Rio de Janeiro Conference
was hastily called in an attempt to bring about Latin American
solidarity in the war against the Axis. German activity in Latin
America made this difficult; in fact, as it later proved, impossible.
At the conference Sumner Welles stated:







24 The Caribbean at Mid-Century
. the security of three hundred millions of people who inhabit
the Western Hemisphere and the independence of each of the
countries here represented will be determined by whether the
American nations stand together in this hour of peril, or whether
they stand apart from one another.
However, the United States Navy and War Departments had
informed Welles early in January, 1942, before the Conference,
that a declaration of war by all the American nations, most of
which were totally unprepared, would place the burden of defend-
ing the entire area from the Mexican border to Cape Horn on
the United States at a time when this nation might have some dif-
ficulty defending its own shores.
In spite of this grave experience, the policy for military integra-
tion has been so weakly pursued that today, eight years after the
Rio Conference which was called with great anxiety, we are piti-
fully ill-prepared to defend this Hemisphere.
Within the last month, events in Korea have reached a state of
crisis A week ago President Truman stated: "We are fighting in
Korea for our national security and survival."
Does this mean that we have no alternative other than throwing
all our resources into the struggle in Asia? The time is late but
perhaps not too late even now to reassess our foreign policy and
change its course. Great Britain and France have clearly indicated
their belief that we should do so, at least so far as Asia is concerned.
The United States in her present position of world power re-
quires and deserves a foreign policy nearly thought through and
defined for our preservation and the promotion of our true national
interests. We must evolve from our present method of making
policy to meet current crises. Foreign policy is not like a grain
crop that is sown in the spring and harvested in the summer; it is
like an orchard that must be carefully guarded and cultivated for
years before it can bear good fruit. I feel certain that a careful
reassessment of our foreign policy will reveal that our great national
interests lie in this Hemisphere.
IV
Pan Americanism, or at least what has been called a "Pan
American feeling," goes back as far as 1741, when rebellious
Spaniards asked for English help.
In the Nineteenth Century, Bolivar gave the great weight of







HEMISPHERE INTEGRATION NOW Z3
his deeds and name to Pan Americanism. ". .. the ideal of Ameri-
can unity appealed to men of vision in both North and South
America during the first decade or two of the nineteenth century,"
says the historian Lockey. Mariano Moreno, the leading light of
the Buenos Aires revolutionary "junta," was against it, and his
opposition did much to shape Argentine diplomacy down to the
present day. Moreno felt that distances were too great and prob-
lems and interests too diverse to allow successful cooperation.
The United States has not desired and so has not made any
serious attempts to integrate this Hemisphere. The Argentine has
never had an interest in following the United States through its
tortuous maze of foreign policy in Latin America and indeed, more
often than not, the Argentine has had every interest in blocking
the objectives of the United States.
Of Moreno's original objections, the basic one of distance is no
longer valid. Then Buenos Aires was about twenty-four days re-
moved in travel time from Washington. Today the time is about
twenty-four hours. In the near future the time will be cut in half.
In the not distant future, when true rocket transportation becomes
practicable, Washington will be about two hours removed from
Buenos Aires. Moreno's other objection-that interests were too
diverse-still keeps the Argentine and the United States apart and
to a lesser degree the other states of this Hemisphere.
Today the national interests of the states of this Hemisphere are
naturally linked together. We are in mortal peril unless we bind
ourselves together for mutual protection. Mistakes of the past,
antagonisms arising from them, our habits of thought based on the
Eighteenth, Nineteenth, and first half of the Twentieth Century
world, make it difficult for both North and Latin Americans to
accept the initial sacrifices that Hemispheric integration is bound
to entail. However, "when the devil is sick, the devil a saint would
be." In this moment of national, Hemisphere, and world sickness,
perhaps we can rise sufficiently to the needs of these fateful times
to overcome our prejudices of the past and our outdated modes of
thinking.
I should like to revert to one of my original premises that Com-
munism is an international conspiracy to overthrow non-Commu-
nist governments throughout the world. Here in this Hemisphere
we can escape the Russian menace only by the most complete
integration of our sovereign states that can be made practicable.







26 The Caribbean at Mid-Century
The old world of the sea age had some apparent luxuries now
denied us. We no longer have the luxury of the Americas isolated
by oceans, protected by the British Navy, and illumined by the
spirit of the Monroe Doctrine. The luxury of making and hurling
resounding phrases in order to arouse the people to anger and
bitterness, now no longer may merely achieve personal or political
advantage; it may be a danger to the sovereignty of the state. The
chorus cry of "Yankee imperialism" by South American dema-
gogues and professional Latin American intellectual "experts" from
the north may have in the future a far more tragic consequence
than creation of international disharmony. We can no longer
permit ourselves flag-waving orgies, discrimination, trade barriers,
and uneconomic policies under the name of nationalism when our
urgent need is continentalism. In Latin America just and economic
land reforms are overdue as are tax systems that support progress
and stifle privilege. This is a late hour to kill by expropriation any
more capitalistic geese that lay golden eggs before a new brand of
golden-egged geese can be hybridized. And there is still time to
establish the rights of the laborer before he receives the Communist
kiss of death.
The integration of this Hemisphere is feasible. It is practical.
It can be almost wholly accomplished through bilateral treaties
later to be supplemented by multilateral treaties when desirable.
Hemispheric conferences have been tried, with only limited success.
Experience has proven that treaties, negotiated directly, represent
the only effective method.
The hope of humanity in today's bellicose world lies in interna-
tional understanding, good will, and cooperation. We must extend
the solidarity of family and community and nation beyond our
borders. We must make a new approach to human relations
among nations. I believe that this can be best achieved through
first building a community of interests. Where can there be better
ground to build this community than in this Hemisphere, as a
guiding light to world unity?
From the northern reaches of Canada to the tip of Tierra del
Fuego, people have settled this continent to escape injustice and
seek opportunity. They are united in spirit but separated by arti-
ficial boundaries of a past age. Break down these barriers so that
the people of the Americas can rise to a new level of human
understanding and progress!










Part II




ECONOMIC AND GEOGRAPHICAL
PROBLEMS OF THE CARIBBEAN
AREA
















3





Raymond E. Crist: RESOURCES OF THE
CARIBBEAN




THROUGHOUT history and among all peoples the use that has
been made of the land has had significant implications for all mem-
bers of society. How many people own or control how much and
what kind of land, and what they do with it, are matters of vital
concern to all. The pattern of land use is frequently as much in-
fluenced by the system of land tenure as by the edaphic conditions,
and the very lives of millions of people depend upon the way the
land is utilized. Space does not permit the discussion of the salient
features of the situation of land tenure and of land use in all the
circum-Caribbean countries Accordingly, the Antillean islands
of Puerto Rico, Haiti, and Cuba, and the mainland countries of
Venezuela and Mexico have been selected as being on the whole
representative, and some aspects of land tenure and of land use in
those political units will be examined in this paper.


1. The Islands

The West Indian islands, in the form of a great arc, stretch
from the Peninsula of Yucatan in southeastern Mexico, to the
mouth of the Orinoco, on the-northeastern coast of South America.
Cuba, the westernmost island, is within easy reach of YucatAn and
Florida; the island of Trinidad, an outlier of the continent of
South America, is separated from it by a narrow body of water,
the Gulf of Paria. Between Cuba and Trinidad lies a heterogenous







30 The Caribbean at Mid-Century
collection of islands varying greatly in size and potentialities. These
islands were discovered by Columbus in his search for a westerly
passage to India, and the name he gave them, the West Indies, is
still used today; they assumed great strategic importance when
Cortes and Pizarro sent back to their sovereigns their amazing re-
ports of conquest in the wonder empires of the Aztecs and the
Incas on the continents beyond.
The constantly warring states of northwestern Europe, also
beckoned by glittering visions of gold, began to expand on the
farther side of the Atlantic. To gain a foothold in the Caribbean
-in those days when might frankly made right-was no easy task.
The weakness of France, England, and Holland was evidenced in
the very small crumbs of islands they were able to snatch from
the rich Spanish table. These insignificant islands-they were as
petty cash to the Spaniards, who controlled the rich mines on
"the Main"-were colonized and fortified as outlying possessions
by the several mother countries. The history of the Antilles be-
came an accurate reflection, in miniature, of the internecine wars
of Europe. On these lovely tropical shores the greed, the injustices,
the diseases, and the fierce religious hatreds of Europe were brought
to a focus.
So great was the lure of gold and adventure on the continent
that the Spaniards actually encountered serious difficulty in main-
taining on their islands garrisons of sufficient numbers to defend
them against the enemy countries. We need not raise a smug eye-
brow at such a manifestation of greed, for if the California of the
gold-rush days had been as accessible to English colonists in the
seventeenth century as was Mexico to the West Indian Spaniards
in the sixteenth century, the lands of the English colonies on the
Atlantic seaboard might well have been passed over in neglect.
Because the island Spaniards were blinded by the gold beyond,
fertile regions, which, by modern standards, were richly endowed
with natural resources, for centuries were not made to produce
enough to pay the expenses of government.
The result was that the Philippines, Cuba, and Puerto Rico-at
times even Venezuela, Florida, and Louisiana-were subsidized
from the treasury of New Spain in amounts varying from three to
four million dollars a year. Meanwhile the English, French, and
Dutch, lacking immediate access to the gold and silver mines, de-







CARIBBEAN RESOURCES


veloped divers other techniques for conquering fortune: their buc-
caneers lay in wait for the great Plate Fleets of the Spaniards and
plundered their bulging cargoes; they captured Negroes in Africa
and sold them to the conquistadores for use on the plantations that
were springing up all over the new Spanish possessions. However
deplorable, it is a matter of historical record that relatively few
sought out the Caribbean islands-Spanish, English, French, or
Dutch-inspired by a motive higher than the desire to extract the
greatest possible wealth in the shortest possible time.
The West Indian islands early became known as the sugar
islands, though they were by nature adapted to any form of tropi-
cal agriculture. Yet even in the beginning little diversification of
crops was practiced. Because it offered the quickest way to wealth
by agriculture, cane growing was the common choice. Sugar was
still in Europe a medicament bought by the ounce from the apothe-
cary. Its high value in the European market, and the relative
cheapness of its production in the Indies, once the slave trade was
efficiently organized, made its cultivation an extremely profitable
business.

II. Puerto Rico

Very early in the history of Puerto Rico, once it was clear that
little gold could be uncovered on the island, the attention of the
crown officials was directed to the possibility of deriving wealth
from the production of sugar, and many efforts were made to
safeguard the sugar plantations. By Royal Decree, dated January
15, 1529, no sugar plantation, or anything necessary in its opera-
tion, including slaves, could be forcibly sold to satisfy debts, unless
the King was the debtor. A somewhat larger quantity of sugar
was produced on the island of Puerto Rico during the second half
of the sixteenth century than during the second half of the eight-
eenth, when coffee growing became a prosperous enterprise. The
growing of coffee was carried on to a large extent by free labor,
because the techniques demanded a certain amount of training
and skill, and the relative smallness of the unit made the keeping
of slaves unprofitable. Returns were adequate but not exorbitant.
The golden age of the coffee planter was the latter part of the
nineteenth century, when coffee was the main agricultural export







32 The Caribbean at Mid-Century
crop and chief source of income for half the population. As sugar
proved less and less able to meet competitive conditions, coffee
came forward as the predominant plantation industry, and en-
croached, as sugar cane had once done-and was soon to do again
-upon land otherwise devoted to food crops and stock raising.
Let us analyze briefly the process whereby, during the past half-
century, the great increase in the value of exports from Puerto
Rico has failed to be reflected in a general rise in the level of liv-
ing. The Congress of the United States, moved partly by the cur-
rent campaign against land speculation at home, on May 1, 1900,
passed a resolution to the effect that no corporation could own
more than 500 acres in Puerto Rico. But, since the resolution
fixed no penalties for those who violated it, it was not respected.
By 1930, violators of the 500-acre law-367 out of a total of
58,371 landholders-controlled almost one-third of all farmland,
whereas farms of less than 20 acres, comprising 72 per cent of
existing farms, occupied only 12.4 per cent of all farmland. The
period from 1900 to 1930 was the golden age for the sugar com-
panies, when, according to the Report on the Sugar Industry in
Relation to the Social and Economic System of Puerto Rico,
"sugar was everything and everything was sugar."' In the course
of fifty years the industry has absorbed most of the fertile alluvial
land of the island The control of large landholdings could not
have been maintained without control of the railroads, which the
sugar industry accordingly built. Excellent black-top motor roads,
the construction costs of which were contributed in the beginning
out of insular funds, but increasingly-since the early thirties-by
the general taxpayer of the United States in the form of federal
funds, have naturally been of greater use to the modernized sugar
industry than to the neglected coffee industry. Exports of sugar
products to the mainland have paid for the major necessities of
life, which have been bought in growing quantities in the conti-
nental United States. Finally, as brought out in the report just
quoted, compiled in 1941, "the estimated sugar-cane wealth of the
island is 36 per cent of all taxable wealth. Yet the sugar industry
paid in 1940 only 23 per cent of all revenues of the government,
while all other taxpaying groups, whose taxable wealth was esti-
1 Senate Document No. 1 of the First Session of the Puerto Rican
Legislature.







CARIBBEAN RESOURCES


mated at 64 per cent of the total, contributed 75 per cent of all
revenues of the government,"2 although, according to the same
source, slightly more than half of sugar's income over a period of
years was derived from tariff benefits.
Hurricanes and the wagelessness of the Great Depression did not
improve matters, and the people as a whole sought some effective
way to stop the growth of the land monopoly. There was still that
500-acre law on the statute books, but it was old and toothless.
Teeth were provided by act of the insular legislature in 1936, which
made possible quo warrant proceedings for the taking over by the
insular government of corporation acreages in excess of 500 acres.
The sugar companies sensed the danger. They rushed to battle
with the cry that it was unconstitutional to enforce a law whose
violation had been accepted in practice for so many years. The
Puerto Rican Supreme Court handed down a decision against the
land monopoly of the corporations, and the decision was sustained
by the United States Supreme Court. The problem of the island
is stated in finely chiseled word-cameos in the decision of the
Puerto Rican Supreme Court:
The existence of large land holdings in a small agricultural
country, abnormally overpopulated and without basic industries
other than those required for the preparation of agricultural prod-
ucts for the market, is contrary to the economic welfare of its
people.... The end sought by the [500-acre] statute is to protect
this small island and its population against monopoly which would
end by making them serfs of a huge sugar factory.

The judges who wrote this decision faithfully reflected the feel-
ings of the people, for the new legislature that met in 1941 passed
a Land Law which created the Land Authority. It is not within
the scope of this paper to discuss the Land Authority, the redistri-
bution of the land to hungry people, or the proportional-benefit
farms, or how effective they will be in the rehabilitation of the
people of the island. Suffice it to say that the concentration of land
since 1898 in the hands of a few sugar corporations has been con-
sidered a disservice by the overwhelming majority of Puerto Ricans,
as is betokened by their loyal support at the polls in 1944 of the
Popular Party, which has initiated agrarian reform. It is certainly


2 Loc. cit.







34 The Caribbean at Mid-Century
not a coincidence that the pre-election battle cry of the victorious
party was "Bread, Land, and Liberty."
A significant item was reported by the United States Senate
Committee on Territories and Insular Affairs that visited the island
in 1944:
The acreage formerly cultivated for locally consumed foodstuffs
has been changed to cash crops for export, thus making Puerto
Rico gradually and increasingly dependent upon importation of
continental agricultural commodities.. Sugar acreage increased
sevenfold (1899-1939) while food acreage increased only 2 1/6
times in that same period of time.3

Meanwhile the population has doubled; in other words, it has
kept pace with the increase of food acreage. The increased food
acreage, moreover, comprises only plots of the less fertile land,
which was all that was available for the purpose. In short, there
has been no "per capital" increase in produce for domestic con-
sumption. But the cost of living has undergone an increase many
times greater than any increases in wages, because of the fact that
foodstuffs must be imported in ever-growing proportions from the
United States, which is a high-price area.
In Java the Dutch were very careful not to allow sugar com-
panies to alienate permanently large tracts of land for growing
cane. According to law, planters could rent rice lands for the
cultivation of sugar cane for not longer than eighteen months in
any three-year period. This not only insured crop rotation, but
prevented overdependence on imports of rice. In the British
West Indies every proprietor of lands once was obliged, by one of
the Slave Acts, to keep properly cultivated in root crops, or ground
provisions, one acre for every ten slaves, exclusive of plots or gardens
which the Negroes cultivated on their own account. It is to be re-
gretted that regulations such as these, assuring as they did a
modicum of crop diversification and self-sufficiency in foodstuffs,
were not carried over into the sugar producing areas of today.
Although it is frequently maintained that, up to the point of
diminishing returns, the plantation system is economically more
efficient than the small owner-operator system, this contention, in

s Garver and Fincher, Puerto Rico: Unsolved Problem, Elgin, Illinois,
1945, p 47







CARIBBEAN RESOURCES J)
the opinion of Dr. Pic6, well-trained observer and careful scholar,
does not hold true in Puerto Rico:

The need for more than 500 acres per farm for efficiency in
production has not been substantiated by facts. In view of the
unsocial distribution of income that results from concentration of
large tracts of land in the hands of private individuals, the practice
of owning more than 500 acres should be condemned.

The owner-operator system of land tenure would, therefore,
seem to be justified on economic grounds as well as from the point
of view of social considerations. The sugar plantation system as
evolved in Puerto Rico, particularly during the last half-century,
has lacked the social stability that usually accompanies owner-
operatorship-a phenomenon or state of affairs that seems to
endow with broad geographic significance the classic statement:
"Latifundia perdidere Italiam." This system, in spite of its eco-
nomic efficiency in production, has, everywhere in the world, been
unable to escape labor troubles. Hostility, engendered by the fric-
tion between landed and landless, flares up frequently in strikes
and revolts--modern versions of the bitter agrarian struggles so
familiar to students of the rise and fall of societies around the
Mediterranean.
Farming in large units may indeed permit of huge "economic"
returns, which have, however, not infrequently been over-balanced
by the low "social" gains. Unless profits are increasingly prorated
on a fair percentage basis among capital, labor, and management,
it may still hold true that

Ill fares the land, to hastening ills a prey,
Where wealth accumulates, and men decay.
Princes and lords may flourish, or may fade;
A breath can make them, as a breath has made:
But a bold peasantry, their country's pride,
When once destroyed, can never be supplied.

There is a crying need for higher capital investment, rationaliza-
tion, and complete technical re-equipment in every phase of ac-
tivity on the island, save in the sugar industry alone. But despite
the modern technological processes that have been introduced into
the sugar mill, the landless day laborer in the cane field remains in







36 The Caribbean at Mid-Century
the hoe and oxcart and machete stage of development, and he is
paid according to the standards of pre-industrial society. The
high-salaried sugar chemist in the mill is in the rarefied atmosphere
of economic Olympian heights, far removed from the low-wage
cane cutter grubbing away in the stifling humid air on the earth
below; for the vigilance of the chemist saves the company his
yearly salary many times over, but the efficiency of a man with a
hoe and a machete merits only the poorest remuneration. Although
it may well be true that the cash income from a single acre planted
in cane is equal to the income that could be derived from as many
as four to twelve acres planted in food crops, nevertheless the ad-
vantage is of little practical benefit to the mass of poorly nourished
Puerto Ricans, who have little share in the sugar income. If
mechanization is introduced all along the line, and if workers are
freed from endemic diseases and are enabled to obtain a balanced
diet, per capital production for those employed will increase and
wages can rise; more food and social services can be purchased and
island-wide production and well-being will increase in an upward
spiral.
How can workers get a better diet, which would help step up
efficiency? They must either grow more food or import more.
Since sugar has pre-empted most of the good land on which the
growing of foodstuffs would have been possible, it would seem
logical and necessary to import more food. But how can Puerto
Rican workers continue, with their present miserable wages, to buy
food in the market of continental United States, in competition
with workers earning five to ten times as much? Yet as long as
the sugar interests can survive only behind the United States tariff
wall, so surely will the Puerto Rican laborer be forced to pay
American prices for consumers' goods, instead of bidding freely on
the world market for cheaper produce. Thanks to these restrictions,
some $5,000,000 per year is added to the cost of rice, mainstay of
Puerto Rican diet, and from 10 to 35 per cent is added to the cost
of shoes, which are an essential in tropical Puerto Rico to the pre-
vention and control of hookworm. To be sure, some students of
the situation maintain that the benefits of the sugar tariff far out-
weigh the added costs of the imported necessities. Be that as it
may, it is still apparent to even the most casual observer that Puerto
Rican workers have been ground extremely fine between the upper







CARIBBEAN RESOURCES


and the nether millstones, that is, between metropolitan industrial
prices and colonial pre-industrial wages.


III. Haiti

Haiti was for a long time one of the richest agricultural colonies
in the New World. In the eighteenth century the income derived
by the French from Haiti was several times greater than that
which England took from the thirteen colonies combined. As a re-
sult of the revolt of the slaves, this export prosperity ceased and
Haiti did not follow the pattern, common to almost all Latin
America during the nineteenth century, of an aristocratic land-
owning class lording it over a great mass of peons. In Haiti, the
former slaves became peasants rather than serfs, and their vigorous
leaders made them realize that freedom did not mean merely free-
dom from work. Sonthonax, in his great speech in 1793 on the
duties of liberty, cried that "in France all are free, yet everyone
works."
In comparing present conditions in Haiti with the rich planta-
tion export economy of 1789, it must be kept in mind that: (1)
the newly freed slaves became landholders, but they lacked capital,
technical instruction, and experience in small plot farming; (2)
the new country was forced to pay France an indemnity of 60 mil-
lion francs which otherwise could have been used to buy the tools
and the technical skills wherewith to effect salutary changes in the
economy; (3) the hostility of much of the rest of the world-all
slave-holding at the time the Haitian Republic was founded-
manifested itself in denying Haitian products a market, thus con-
demning the country to commercial stagnation and self-sufficiency.
The feeling of security of the small owner-operator has probably
been a factor in the rapid increase in population. The cultivation
of tiny fields on steep mountainsides has assuredly been a boon to
the erosive activities of tropical downpours. But the greater the
increase in population, the greater the pressure to clear more and
more small farms on steeper and steeper mountain slopes, and thus
the circle continues. Thus the country is neither able to produce
a huge export crop nor to become self-sufficient. As one shrewd
observer said, "Haiti has neither a one-crop nor a self-sufficient







38 The Caribbean at Mid-Century
economy--rather it has a bite-your-nails economy" It is an orphan
in the international market.


IV. Cuba

Fortunately for Cuba, Columbus did not find much gold on
that island, and as a result early settlers had to turn to agricul-
ture. Those Cubans who stayed on the island during the conquest
of Mexico made money breeding cattle and horses to be used by
the conquistadores. Within a century the cattle ranchers felt as
secure in their position as did the members of the Honrado Consejo
de Mesta, that guild of Spanish sheepmen who for so long tyran-
nized the small farmer of Spain. But they were not without com-
petitors, for from the very beginning the sugar planters were
favored by legislation as well as by cash bonuses and subsidies.
Prosperity was with the sugar planters until the nineteenth century,
when subsidized beet sugar made increasing inroads into the cane-
sugar market, and when costs on the plantations had to be re-
duced. At the same time slaves were becoming more expensive and
more and more inclined to revolt. Crops which competed with
cane were not slow in putting in their appearance.
The big event in the history of coffee in Cuba was the arrival
of the French fleeing from Haiti after the revolt of the slaves in
1791. One of the secrets of the economic and cultural success of
the coffee plantation in Cuba was that it was of family size, re-
quiring relatively little capital but much care, and therefore the
coffee growers lived on their estates, in contrast with the cattle
ranchers, who were largely absentee. In a short time the French
developed small but flourishing coffee plantations in regions where
the extensive grazing of cattle had been almost the only activity.
But how was the market to expand? Intercolonial trade was for-
bidden by Spain. Money from the Viceroyalty of Mexico was re-
mitted to La Habana to make up the annual deficit in the cost of
the civil and military administration of Cuba; yet there was, as of
January 14, 1815, a duty of 24 pesos the hundredweight placed on
all merchandise entering Mexico from Cuba. This effectively kept
out Cuban coffee, which at the time was selling in La Habana for
only four pesos the hundredweight. The Royal Order of February







CARIBBEAN RESOURCES


10, 1818, officially opening the ports of Cuba to foreign vessels,
gave added impetus to the island's already flourishing commerce-
much of which had been contraband. But the civil wars of the
nineteenth century destroyed agriculture and commerce, and after
the Civil War of 1895, which gave the coup de grace to agricultural
prosperity in Cuba, the ruined coffee plantations were replanted
for the most part in subsistence crops or in sugar cane, or they
were left to grow up in worthless brush.
When the political ties with Spain were finally severed, big
corporations became interested in the sugar and tobacco industry,
which experienced what Professor Toynbee might call a "dynamic
Yang" phase of development. The coffee industry was completely
neglected. During the first thirty-five years of the republic, Cuba
even imported coffee, to a total value of $102,230,984. But the
terrible depression in the sugar industry that followed World War
I fulfilled the prophecy of the Cuban patriot, Marti, who, only a
quarter of a century before, had warned: "A people commits
suicide on the day it trusts to one crop for its subsistence."
Coffee, sugar, tobacco, cattle raising--each, in the economy of
Cuba, has had a history of successive phases of growth and decline,
but the land-tenure pattern established four hundred years ago
persists over large areas to this day; on the one hand 2,336 lati-
fundia (estates of 1,235 acres or more) account for 47 per cent of
all the privately owned land in Cuba, 90 per cent of the total ex-
tent of which is uncultivated, while 157,622 farms (fincas), 40,000
of which are intensively cultivated, occupy the other 53 per cent.
The large holdings grew larger on some of the most fertile land as
sugar became the dominant crop, and larger but fewer mills de-
manded more and more cane; but the "dance of the millions" in
the early 1920's was followed by a terrific depression. The govern-
ment stepped in with a high-tariff act (1927) which greatly stimu-
lated the production of dairy products, meat, poultry and eggs,
coffee and potatoes. A case in point: in 1927 Cuba imported
5,000,000 pounds of cheese, but in 1941 domestic production in-
creased to 9,000,000 pounds, of which one million pounds were
exported. Increases in domestic production mean more work for
Cubans: The 28,836 farms specializing in meat production in 1946
employed more than 100,000 workers, with a total payroll of
$14,000,000. This increased purchasing power in the hands of a







40 The Caribbean at Mid-Century
growing number of Cubans is used to buy locally grown foodstuffs
and the products of modest household industries. Many of the
small farms and industries are owned and operated by Gallegos or
Islefios (Canary Islanders) or their descendants who have so suc-
cessfully transplanted in the New World their Old World traditions
of thrift and hard work. A middle class would seem to be in process
of formation in Cuba.
By way of concluding these paragraphs on Cuba, a quotation
from Sir William Van Home, builder of the Canadian Pacific and
of the Cuban railroad systems, seems pertinent. He wrote to Gen-
eral Wood as follows:
A system of land-taxation is the most effective and equitable way
of securing the greatest possible utilization of lands, and affords at
the same time the best safeguard against holding lands in disuse
for speculative purposes. It affords, moreover, the most certain and
uniform revenue to the state. Freedom from land taxation comes
from landlordism, which you certainly do not wish to continue or
promote in Cuba. The country can only reach its highest prosperity
and greatest stability of government through the widest possible
ownership of the lands by the people who cultivate them.4

Many foreign nations have political or economic enclaves on the
Caribbean islands. Islands close to each other in space, or even
parts of the same island, may be incorporated into the economies
of distant countries, their well-being dependent upon the whims of
overseas consumers and pressure groups of many different lands.
Geographic specialization is the summum bonum, the ideal-other
things being equal. But things are not equal when the very diet of
the farmers who produce for the international market is determined
by distant foreigners. A certain amount of diversification of crops
is healthy in these days when foreign markets are unstable. But
as long as diversification of crops is preached while the big money
is to be made in one-crop farming, the sermon will go unheeded.
Even such islands as remain politically independent are buffeted
about on the rough seas of the international market, tossed be-
tween the Scylla of self-sufficiency, with a low standard of living,
and the Charybdis of monoculture, with a resultant colonial eco-
nomic status.

SLeland H. Jenks, Our Cuban Colony, New York, 1928, p. 153.







CARIBBEAN RESOURCES 41
Dr. Carlos E. Chard6n, outstanding Puerto Rican scholar, aptly
sums up the situation in his penetrating paper on "The Caribbean
Island Economy":
We must consider first that the Caribbean is a geographical
region; and, second, that we are dealing also with a series of politi-
cal entities. For more than three centuries the political patterns
have prevailed over the geographic reality, which has brought
about a disarticulated economy among islands forming part of an
archipelago. In considering separately the political units and their
problems, by far the majority of students have neglected the fact
that in a sound economy the political units (without interference
with their sovereignties or those of the metropolitan governments)
may in many cases play an important economic role with reference
to the economy of the others. So far, efforts have been isolated and
fragmentary; the perspective of the whole has been ignored, and
each country, or each colony or group of colonies, has fought its
own battle, trying to solve its problems independently. This re-
minds us of the man who failed to see the forest for the trees.5


V. Venezuela

Freedom from Spain meant little to the serfs and slaves in
Venezuela, but when Bolivar and Paez offered them land and per-
sonal freedom they flocked to the republican banner. When these
promises were not fulfilled there followed a century of upheaval
and revolution. The rural farm worker fought in the disastrous
civil wars, mainly because he hoped to acquire a piece of land of
his own. The battle cry was, often enough, to "make a homeland
(patria) for the Negroes and Indians"--those still at the base of
the pyramid. Only a few urban dwellers seemed to worry much
about such a vague intangible thing as federalism; the rural dwell-
ers followed Ezequiel Zamora and Martin Espinoza because these
leaders promised something tangible: land.
In more recent times, the Dictator G6mez was an hacendado par
excellence, having acquired huge estates all over the country, par-
ticularly for the pasturing of cattle. When he died in 1935 many
felt that his great holdings would be made available to the people
in some way; instead, to a large extent, they have been put under
the administration of bureaucrats who are costing the country
5 Scientific Monthly, LXIX, no. 3 (Sept., 1949), p. 169.







42 The Caribbean at Mid-Century
fabulous sums each year. And age-old farming techniques are un-
changed. Many actual abuses continue as before. In the hacienda
of Manuare the workers receive payment in counters (fichas),
valid only for the high-priced goods in the hacienda store. The
"Jefe Civil of the Distrito," Carlos Arvelo, telegraphed the news-
paper, Esfera, that "thousands of rural workers suffer in the living
flesh the black rigors of their destiny," and that the peons on the
hacienda of El Trompillo were "corroded and exasperated by a
big Grievance"-the lack of land, seeds, and agricultural imple-
ments.6 Ricardo Mandry, a Catholic priest, wrote in the same
paper:

Latifundismo still exists. The former critics of G6mez are the
most greedy in grabbing the estates of the deceased Dictator. A
very few people have been favored in the dividing up of the estates.
We have visited almost all of the "haciendas" of the Municipality
of Tocuyito and some of Guigue. We have talked at length with
hundreds of peons and visited their huts. It would take but few
words to put in motion the great mass of discontented people.
When there is hunger in the stomach there is revolt in the heart.7

Farmers, generally illiterate or barely able to sign their names,
have been victimized so long that they are very suspicious of the
motives of any outsider. Their usual attitude was well expressed
by a man near M6rida, whose little plot of ground was being made
the subject of an intensive study in land utilization. Pictures were
duly taken of the tiny fields, the yoke of oxen, the house, and the
family. After this was done the wife asked timidly if she might
have a picture, and was told that one would be sent her husband
from Caracas, where the films were to be developed. But when the
head of the house was asked to give his name, he stubbornly re-
fused, saying, "dar la firma es una cosa seria."s Only after it was
carefully explained that what was wanted was his name, given
orally and not in writing, did he reluctantly give it, and then only
when urged by his wife and children. Such an attitude is the prod-
uct of several centuries of dealings with shysters of all kinds:



B Esfera, Caracas, Venezuela, Aug. 2, 1939.
7 Ibtd, May 12, 1939.
s "It's a senous matter to gpve one's signature."







CARIBBEAN RESOURCES


lawyer, quack doctors, usurers, and highhanded storekeeper-land-
lords.
An agrarian reform does not necessarily imply violent confisca-
tion of all privately held land, but rather a gradual dissolution of
great absentee holdings, especially if they are being used uneco-
nomically from the point of view of modern needs and of technical
efficiency. To break up into small plots those haciendas on level
fertile ground which have already attained a high degree of ef-
ficiency in the production of sugar cane and cotton, for instance,
would be not only uneconomical but anti-social. But where the
small, relatively self-sufficient farmers or the market gardeners could
thrive, land should be available for them, particularly in a country
with as much unoccupied land as Venezuela. And they should
have security of tenure. Many farmers at present are settled on
unused private land or on what they think is public land. But
they do not plant lemon, orange, or avocado trees, or any slow-
maturing crops, because experience has taught them that once any
land is improved, someone will show up with a title to it and reap
the benefits of their hard work. Merely making land available to
the landless is not enough. They should be granted credit with
which to build decent houses and to buy good implements and
seeds, and they should have technical assistance in growing and
marketing crops with which they have had little experience. If
not, they will simply fall an easy prey to the usurer, to the store-
keeper, to the hacendado, and again become part of the floating
proletariat.
On many an hacienda throughout the country, people are living
outside the modern money economy. They do the routine chores
of the hacienda; they put in long hours during the coffee-picking
season, for example, but are not too busy the rest of the year. They
are given a plot of land on which to raise subsistence crops, and
they also get a new garment occasionally, and salt, sugar, and other
necessities which they cannot produce on their plot of land. But
they are rather securely tied to the hacienda by these economic
bonds, and it is too much to expect that such people will begin
anything new in the way of farming techniques. One man near
M6rida said that he had planted a few grains of wheat on his plot
and that they did pretty well. When asked why he did not plant
more, he replied, with that significant Latin American gesture of







44 The Caribbean at Mid-Century
rubbing the fingers together, that he lacked lo principal-the main
thing, namely, cash. And under the present setup he will never be
able to accumulate much cash, and never be in a position to im-
prove, or try to improve, his lot.
If rents were generally lowered, renters could begin to save in
order to raise their standard of living and to improve their farming
techniques. There should be a minimum time limit in all leases so
that the renter could not be summarily evicted from land on which
he had spent time and money in improvements.
Living conditions in the rural areas are very primitive. The
little thatch-roofed hut has walls of wattle-and-daub and a tamped-
earth floor. The cooking is done on the floor, in one corner. Wood
smoke fills the house most of the time, since there is no chimney.
Frequently there is not one stick of furniture. The family sleeps in
some dirty hammocks, or huddled together on the floor on dried,
untanned cowhides. Cooking utensils are few; the only "store-
bought" article, carefully treasured, may be a large iron or earthen
pot. Gourds and old tin cans make up the rest of the kitchen
equipment. Rudimentary ideas of sanitation have never been heard
of; drinking water is never boiled; privies are unknown. Sickness
is rampant and the rate of infant mortality shockingly high.
Small wonder that rural dwellers hate the country and at the
first opportunity leave for the oil fields or towns, where conditions
are indeed bad-85 per cent of the workers' children in Caracas
are undernourished-but better than they are in the country. The
government cannot stop this rural exodus except by measures more
repressive than those that regulated the movement of serfs on
manorial holdings during the Middle Ages. How important is the
solution of the problem presented by the subsistence farmer is shown
by the conclusion of the federal sub-commission which investigated
the flight from the farm: "As long as the campesino is not offered
a reasonable standard of living on the land, all measures to prevent
the migration to the cities will fail. The personal conveniences and
well-being within reach of the man in the city will mean more to
him than the sentimental and patriotic reasons with which he may
be urged to remain in his present miserable condition."
There has been not only a concentration of land, but a concen-
tration of the best land, in the hands of a few. The rich heavy soils
on the floors of valleys, fertile terraces, and gently rolling foothills







CARIBBEAN RESOURCES


have all been monopolized as pasturelands. The small cultivators,
the conuqueros, have been forced to cultivate the higher, steeper,
less fertile slopes, where they look down upon the rich valley bot-
toms devoted almost entirely to extensive cattle grazing. Much land
now used for the growing of food crops could more appropriately
be in pastures or woodlands, and large areas now in pastures are
ideally suited for intensive agriculture. For instance, the valley of
the Tuy River, within easy reach of Caracas by railroad, as well as
by a highway in good condition, could supply the capital with an
abundance of cheap foodstuffs. But the land of this fertile valley
is largely in the hands of about a dozen families, and has for gen-
erations been used as pastureland for the fattening of lean steers
from the Llanos, the great grass plains of the Orinoco Basin. These
manorial holdings are family heirlooms, the incomes from which
enable the owners to live in Caracas in the style to which they
have always been accustomed. The logical thing would be for this
valley to become a market garden for Caracas, whereas cattle
grazing, perhaps on artificial pastures, would be carried on farther
from the Capitol. But the landholders make a comfortable living
under conditions as they are, and are not interested in trying to
raise the per unit productivity of their land by the introduction of
intensive farming techniques. Thus the "dead band" influence of
land concentration first fosters, then crystallizes social and economic
stagnation.
One of the most striking examples of the reversals of pattern in
an urbo-rural cultural landscape as a result of land concentrated
in few hands is to be seen in the environs of San Crist6bal, in
Tachira, Venezuela. A few families for generations have controlled
almost every square foot of land for several miles in all directions
from the very edge of town. The result is that all the fertile alluvial
soil and the gently sloping hill lands near town are in pasture,
whereas the minutely subdivided and intensively cultivated fields
of the small landholders are on the less fertile and more steeply
sloping hill lands many miles from town. Except along the high-
way, all the produce from the area of intensive cultivation has to
be transported on the backs of humans, donkeys, or mules, across
the extensively exploited pasturelands to the market in town.
The basis of efficient intensive agriculture is the regular use of
fertilizers and the systematic rotation of crops, but the small farmer







46 The Caribbean at Mid-Century
of the hill lands and mountains is too poor to buy chemical ferti-
lizers and he does not have enough land or capital to afford to
keep animals, whose manure would be so valuable. The cattle
rancher, on the other hand, has so much rich land that he does
not have to be interested in intensification in the use of his land to
the extent of stall feeding of soilage crops and of using the manure
for restoring the fertility of the soil. The use of fertile, level land
for pasture and of the steep infertile hill lands and mountain slopes
for intensive agriculture means that the basic industry, from which
a great majority of the people make their living, is suffering from
a dangerously split personality-altitudinally speaking it is upside
down, and spatially it is schizophrenic.
It is very difficult to get efficient agricultural methods adopted
widely as long as food production remains to so great an extent in
the hands of shifting agriculturalists who have neither the capital
nor the education to modernize. If general political and economic
insecurity were dispelled, food production could be organized along
efficient lines, for although the network of political frontiers
guarded by tariffs and immigration restrictions constitutes an eco-
nomic monstrosity and a political calamity, smaller nations, to sur-
vive, must resort to these devices if their larger neighbors do so.
Although it is within man's power to produce all his food require-
ments with infinitely less effort than is at present expended, gov-
ernment policies are of necessity influenced by nationalism and
unemployment. The adoption of scientific methods of food pro-
duction would mean that present output could certainly be main-
tained, or even increased, while less land would be cultivated and
fewer men be employed. Poorer lands would be abandoned to
forestry, and the rural exodus would be accentuated; but the
people as a whole would certainly benefit in the long run. A
planned agriculture, with controlled imports, guaranteed prices,
and ultimately some check on over-production, may be necessary,
but the various schemes should be administered for the benefit of
the various national units as a whole, not with the object of main-
taining an out-of-date farming structure. Worship of "Blut und
Boden" should not be so great as to blind political leaders to the
fact that the goal is increased agricultural production, which does
not necessarily mean an increase in the number of men with
machetes







CARIBBEAN RESOURCES


VI. Mexico

Mexico is a land of distant horizons. The great plateaus of the
interior, which are high enough to have a temperate climate and
where as a result most of the population is concentrated, are
hemmed in by the far horizon of a purple mountain chain. But
Mexico is not all a volcano-girdled plateau. It is built up in cli-
matic layers, or strata: the hot lands (tierra caliente) around the
edges, then the cool or temperate lands (tierra templada), and the
cold, high mountains (the tierra fria or pdramos). But these are
not easily delimited regions. Streams have cut great gashes in the
form of canyons into the central plateau so that there is a complex
interpenetration of one climatic region by the other. The result is
that the sharpest contrast in land forms, climate, and the cultural
landscape are found very close together. From one point it is often
possible to view areas representative of almost all the major climatic
types, from the tropical rain forest to the tundra: from the fertile
valley bottoms, where bananas and oranges grow, up through
coffee plantations to the dry mesa country, where maguey, maize,
and barley grow, and still on as far as the eye can reach through
the grazing lands, then the timberlands, and, finally, to the slopes
eternally covered with snow. In this dovetailing of climatic regions
and cultural landscapes lies one of the many attractions of Mexico.
Against this background of sharp physical contrasts there has
been an interplay of the many forces-social, cultural, racial, eco-
nomic-which have gone toward the molding of present-day
Mexico. During the regime of the dictator, Porfirio Diaz, the in-
dustrial policies of modern nations were adopted in Mexico with-
out destroying the feudal structure of the Mexican economic or-
ganization Foreign trade increased from $63,000,000 in 1885 to
$239,000,000 in 1907, and railway mileage increased from almost
nil in the seventies to 16,000 miles at the close of Diaz' regime.
But this industrialization was paralleled by a rapid increase in the
cost of living without a corresponding rise in wages. The oil fields
and mines were largely foreign-owned, and profits from them left
the country.
The Hacienda-The full flowering of the hacienda system oc-
curred during the Diaz regime. The land of Mexico, the support
of the great mass of the population, was in the hands of a very few







48 The Caribbean at Mid-Century
people. Some 60 per cent of the private land in Mexico was owned
in estates of 2,500 acres or more, and almost 25 per cent of the
privately owned land was in the hands of only 114 proprietors.
Furthermore, the process of concentration of land in the hands of
a few was continuing. Villages were deprived of their communal
holdings through the encroachment of "colonization" companies,
or through the manipulation of water rights by a hacendado. Such
a landlord might boast blandly of having moved the mojonera, the
boundary post of a village ejido with water rights to a certain
stream, which the hacendado thereafter diverted to his own estate.
Feuds over land often had at the root a feud over water. Land
was also taken away from "rebellious" villages-particularly Indian
villages with good land-by the government, often controlled by
the local landlord. As a result, the inhabitants of what had once
been free villages were gradually forced to become wage laborers
on the haciendas, where they were soon tied to the soil by debts
and were paid in kind rather than in money in the hacienda store
-the infamous tienda de raya.
Living conditions on the estates were very bad; food was often
in short supply, and housing was primitive at best. As years passed,
the hapless people, landless and wretched, became apathetic, mor-
ally bankrupt, spiritually insolvent. Their resignation for many
years to their seemingly hopeless lot was well depicted in his poetry
by the great voice of Indian America, Jos6 Santos Chocano:

Indio que labras con fatiga
tierras que de otros duefos son:
1 ignoras tt que deben tuyas ser,
por tu sangre y tu sudor?
i Ignoras dt que audaz codicia
siglos atrds, te las quit?
i ignoras td que eres el Amo ... ?
i Quiin sabe, senior!

But the semi-serfs gradually realized that any change would be
for the better, and the cry of the landless for tierra y libertad (land
and liberty) became more and more insistent. Revolution broke
out in 1910, and in the next eleven years more than a million and
a half people moved from the great estates to the free villages; they
fled from their landlords during the period of social and political







CARIBBEAN RESOURCES 49
upheaval in order to return to the free villages where they could
till their small plots of land under the age-old system of communal
tenure. The old landholding aristocracy thus lost some of its power
to the village, to agricultural workers, and to the newly developed
city proletariat.
Land Distribution-At first land distribution proceeded slowly.
In 1930, fifteen years after the inauguration of the agrarian reform,
almost seven-tenths of the total economically active population en-
gaged in agriculture still belonged to the disinherited landless
masses dependent upon day wages or upon such meager earnings
as may be derived from tenant farming or sharecropping. Presi-
dent Cardenas saw that the aims of the Revolution of 1910 had
not been completely fulfilled largely because there was no middle
class to carry them through. Hence, he speeded up the program
of land distribution. In the first twenty months of his administra-
tion he awarded some 3,000 villages, nearly four and one-half
million hectares (about 10,000,000 acres) of land-over half as
much land as had been distributed by all his predecessors together.
By 1945, 30,619,321 hectares (77,000,000 acres) had been dis-
tributed to 1,732,062 recipients. About one-fourth of this land was
crop land; while three-fourths was pasture, woodland, mountains,
and waste. The average recipient has received only about 10 acres
of cropland, and only a very small part of this was irrigated land.
Agrarian communities have been organized into ejidos with the
result that, according to the census of 1940, there were 1,601,392
ejidatarios. The population living on ejidos in 1940 numbered
4,992,058 inhabitants, or one-fourth the inhabitants of Mexico.9
The ejidatarios now have possession of about half of the crop land
in the nation. In addition, there were 928,583 small private land-
holders in 1940 having plots of twelve acres, or less, in size. It is
estimated that at least 40 per cent of the total population of Mex-
ico either lives on ejidos or on small, privately owned holdings hav-
ing 12 acres or less. Some of the expected benefits of the reforms
have been absorbed in supporting the rapidly increasing popula-
tion. It is significant that the Rockefeller Foundation, working in
close cooperation with the Mexican Government on its Mexican
Agricultural Program, has two major objectives: (1) fundamental


9 Nathan Whtten, Rural Mexico, Chicago, 1948, p. 592.







50 The Caribbean at Mid-Century
research on methods and materials valuable to increased produc-
tion of Mexico's basic food crops; and (2) a training program for
selected Mexican scientists.
The social revolution in Mexico has largely destroyed the feudal
environment. Much of the land has now been redistributed to the
people who work it, in response to the governments goal of "land
for the landless." Much has been done to achieve the "emancipa-
tion and incorporation of the Indian masses": educational facilities
are rapidly being extended and transportation systems developed;
minimum wages and working conditions have been established;
social welfare legislation has been enacted. In spite of these basic
reforms, the levels of living among the masses of the population are
still very low; but they have been raised. Millions of people who
formerly had next to nothing now have next to something-which
involves a fundamental change in living and in outlook. Mass
despair has given way to hope in the hearts of millions, the chan-
nels of social mobility have opened, and the hewers of wood and
the drawers of water have a chance of rising to middle-class status.
It is to be hoped that the redistribution of land will be more and
more carefully planned, for the social and political advantages of
breaking up large holdings tend to be ephemeral and illusory
unless farmers are in a position to make a good livelihood from
their new holdings and to set aside capital for improvement.


VII. Conclusions

With few exceptions capital wealth in the circum-Caribbean
countries has tended to be employed in activities which were not
labor-producing enterprises. Wealth made from the land has in
large part been either exported or invested in urban real estate or
in commercial enterprises which yield high returns; it is neither
ploughed back into agriculture nor is it used to develop new wealth-
producing resources Capital has been used as income instead of
as capital to produce more wealth, and the income has been largely
devoted to increasing a comparatively few family fortunes at home
or corporate earnings abroad. This wealth, controlled by a very
thin upper stratum, is not infrequently used in the glittering na-
tional or international capitals for conspicuous consumption rather







CARIBBEAN RESOURCES


than in founding new industries or in increasing the productivity
of agriculture.
And not only is capital drained off the land. Few of the families
who were originally responsible for the development of the agri-
cultural operations, the backbone of the economies of the Carib-
bean countries, have stayed on the land. They migrate to the
cities or abroad, and if they continue to manage their properties,
it is on an absentee basis. Except where the plantation has taken
over, agriculture has remained a relatively unremunerative propo-
sition for the great majority. The modern progressive-looking
urban centers are in marked contrast to so many rural areas where
roads and schools are lacking. Dwellers in many solitary ranchos
or dreary agglomerations of a few houses, without hope, without a
future, in an access of wishful thinking, call their establishments
"La Esperanza" or "El Porvenir."
Thus both wealth and leadership are drained from the country-
side, and the rural industries and factories, which help to balance
an economy and which normally evolve with a healthy agricultural
development, have not put in their appearance. Both capital and
"know-how" are necessary for the many industries which process
agricultural products: slaughterhouses, quick-freeze and refriger-
ated warehouses, dairies and cheese factories, vegetable processing
plants, rice and coffee hullers, and so on. Such industries would
have built up the countries: roads and railroads would have been
constructed, growing cities would have absorbed the surplus rural
population, growth in other industries would be stimulated, in an
upward spiral. But those few nationals with wealth and a willing-
ness to invest it have avoided industrial enterprises and have pre-
ferred rather to engage in business as importers and merchants,
where a minimum of capital is required, little risk is involved, and
the return is high.
But not only have wealth and leadership migrated from the
countryside. The most enterprising and ambitious of the rural
laborers have deserted and are continuing to desert the land to
seek more highly paid (or, at least, paid) employment and better
living opportunities in urban centers. It will be difficult to make
general agriculture a profitable undertaking which will attract
capital and at the same time compete for labor on a reasonably
even footing with urban employment. If a method could be found







52 The Caribbean at Mid-Century
whereby profits to the producer as well as wages to the laborer
could be augmented, agriculture would be on the way to becoming
a middle-class enterprise. But rural living conditions will have to
be made much more attractive than they are in most areas at
present if the energetic, intelligent, and ambitious agriculturalists
are to be held on the farm.
But how is the cost of living to be lowered if profits to the pro-
ducer are to be increased and agricultural wages are to be raised?
It is suggested that the spread between the price the farmer re-
ceives for his produce and the price the consumer ultimately pays
might be due to the antiquated distributing and marketing methods
employed. Producer and consumer cooperatives might help elimi-
nate some of these unnecessary costs Although the Federaci6n
Nacional de Cafeteros of Colombia is an organization of producers
of an export crop, its members reap substantial economic and social
benefits, and it is worthy of study in regard to the problem of im-
proving techniques of distribution and marketing. Each regional
or national unit in the Caribbean area might profitably make a
complete survey of the costs of production and the practices of
marketing foodstuffs, in order to see where cost prices might be
improved for the producer and where they might be lowered for
the consumer.
The stagnation of agriculture and the lack of industrial growth
have perhaps contributed to the dearth of technically and profes-
sionally trained people, for the same thin upper stratum which has
controlled the largest share of the nation's capital has been the
only part of the population that has had the time and money
necessary to acquire training in law, in medicine, in education, in
literature, in commerce, in politics, and so on. Hence in propor-
tion to the population, there is a marked lack of scientists, edu-
cators, engineers, medical men, and industrial leaders; yet without
them it will be hard for the nations to flourish and show vigorous
growth.
It would seem that a reversal of the trend, whereby wealth is
drained abroad or into the big cities, is indicated if the regional
and national economies are to become vigorous. A good start has
been made in various countries, where only a specified amount of
the income from investment can be taken out of the country each
year. The remainder must be left there. It is not confiscated; it







CARIBBEAN RESOURCES


simply cannot leave the country. The result is that this idle capital
soon gets restless lying in the bank and wants to go to work. And
its owner puts it to work by establishing new industries locally or
by enlarging small antiquated plants already in operation. More
wealth is thereby created. A family of my acquaintance is now
happy that a part of its huge income was impounded and did not
get abroad where it would have melted rapidly as a result of heavy
taxes. The capital thus accumulated in the republic of their adop-
tion was reinvested there and has further enriched the country as
well as the family.
Formerly the foreign interests teamed up with the governing
elite to exploit the raw materials from the Caribbean countries in
the developed countries overseas, and spent the bulk of the profits
abroad. This process is becoming more and more difficult. The
masses are becoming politically conscious to the extent that even
dictators feel that they must advertise themselves as the friend of
the laboring man. In spite of repeated setbacks in the striving to-
ward democracy on the part of the Caribbean countries and
islands, the long-range trend has not been affected. Tyranny and
chaos have been on the wane as those peoples have achieved
marked improvement in economic and social welfare, pan pass
with the development of responsible political behavior. And it is
in order at this point to mention the change that has taken place
in the attitude of the United States, in particular, vis-a-vis the
Caribbean; the era of the big stick, to be wielded by the strong,
has been followed by one of cooperation and good will between
sovereign states. In the Organization of American States, the
juridical equality of all the American republics is accepted, whereas
intervention in the affairs of any is abjured.
Political independence without economic independence is fickle,
if not actually fictitious, and economic independence in the modem
world is hardly to be thought of without an accumulated national
capital reserve. Monies to make up this reserve cannot be extracted
from self-sufficient subsistence farmers who live on the margin of
national or insular economies, nor can they be levied either from
day laborers or peons on estates, who live from hand to mouth. It
would seem that individuals and corporations that are at present
exploiting on a large scale the fertile agricultural land and the
rich mineral deposits can expect a rising tax rate, which will mean







54 The Caribbean at Mid-Century
that they will pay the lion's share of the cost of those services for
which governments are increasingly held responsible. It is not too
difficult to replace the traditional paternalism of the landlord or
of the big company by a paternalism of the state as long as state
benefits are gradually filtering down to ever lower economic strata.
Peasants and workers eagerly support the state which raises their
level of living, even if only slightly. And as natural resources are
increasingly used for economic-social rather than for economic-
military developments, the traditional "strong" government will be
increasingly supplanted by the more popular variety. Mexico is
a good example of a state which has, in the words of Frank Tan-
nenbaum, achieved "peace by revolution":

It is the land that freemen till,
That sober-suited Freedom chose;
The land, where, girt with friends or foes,
A man may speak the thing he will;
A land of settled government,
A land of just and old renown,
Where Freedom slowly broadens down
From precedent to precedent.
-Tennyson, "You Ask Me Why, Tho' Ill at Ease."













4





Maynard Phelps: TECHNICAL "KNOW-HOW"
VERSUS FOREIGN INVESTMENT IN ECONOMIC
DEVELOPMENT




A S THIS is a round-table meeting my function, as I see it, is to
raise a number of issues which will elicit discussion among you,
perhaps to be somewhat provocative. The title selected for this
paper may have that effect as it appears to be contradictory. We
are accustomed to thinking of the export of technology as one of
the principal features of foreign investment. The fact that capital
and technology are usually combined in direct investments is con-
sidered one of their chief advantages over portfolio investments,
both to the foreign investors themselves and to the countries in
which the investments are made. With this conclusion I am in
substantial agreement. In direct investments the two are almost
inseparable if the investments are to be "operated" rather than
simply "held" for appreciation in value. Still it may be useful for
purposes of analysis, initially at least, to think of the export of
technology and of capital as separate movements and even in op-
position one to the other.
One reason for so doing is that they have been too closely con-
nected in the minds of those people in the other American repub-
lics whose hopes for more immediate and extensive economic de-
velopment were aroused by the Point Four pronouncement. It is
not a "bold, new program" as first announced, but rather an ex-
tension or accentuation of a program which has been underway
for many years. If President Truman had said that we have been
cooperating with the other American republics in the fields of







56 The Caribbean at Mid-Century
public health, agriculture, and industrial development, among
others, for many years, that significant results have been attained,
and that we propose to accentuate and extend the program to other
parts of the world, there would have been little misunderstanding.
But, at least in part, because of the manner of announcement, it
was misunderstood by many people, both at home and abroad. Un-
fortunately, to them Point Four meant immediate and large-scale
financial aid, somewhat on the order of the Marshall Plan. But,
as you know, the two programs are essentially different in concept
and objectives. Therefore, one of the first problems of the De-
partment of State, and a most difficult one, was to dissociate the
export of technology and that of foreign investment, as much as
possible, in the thinking of other peoples; to indicate that the ex-
port of technology may require very little concurrent capital in-
vestment abroad. Yet another fact should have been emphasized,
namely, that scientific management is greatly needed in underde-
veloped countries, perhaps even more than technology.
People often confuse pure science, technology, and scientific
management. They do not see the distinction between pure science
and applied science. The aim of science is to discover new
knowledge, new principles. In contrast, the aim of technology is
to invent new devices, to develop new processes and techniques.
New developments in technology are based upon additional
knowledge uncovered by research scientists. We, as a people, have
not been particularly successful in scientific discoveries. For in-
stance, the basic discoveries of radar and atomic energy were made
in Britain and Germany. But we have been effective in making
practical use of basic principles, often discovered by others. Over
a fifty-year span only twenty Nobel Prizes in physics, chemistry,
and medicine were awarded United States citizens, while 119 were
awarded to Europeans-thirty-six to Germans alone. However, in
the field of technology, as such, we have been very effective, and
it is this knowledge which is most needed in underdeveloped
countries.
These countries likewise need to understand and apply the
principles of scientific management, which may roughly be defined
as social science applied to economic ends. Businessmen in the
other American republics need more understanding of "how to do
things most easily," and this involves both technology and scientific







ECONOMIC DEVELOPMENT 5/
management. It is not a question of working harder, which was
always the answer of the old horse "Major" in George Orwell's
satire on socialism, Animal Farm, but one of how to get economic
tasks done more easily and with less labor.
It has been the traditional policy of the United States to place
no barriers against the export of these two most important "com-
modities"-technology and scientific management. The signifi-
cance of this policy has neither been sufficiently understood nor
stressed. Such a policy has not been followed at all times, by all
nations. The British, for instance, after the American Revolution,
attempted, by every possible means, to withhold the exportation of
the technology of the textile industry from the colonies. Laws
were passed prohibiting the export of any plans or drawings used
in the machinery of manufacturing, and efforts were made to pre-
vent the emigration of factory workers or others who had knowledge
of the construction of textile machinery.
Restriction of this character is adverse to our accepted policy
of not withholding either technical knowledge or specialized equip-
ment from other countries, other than for reasons of security. It
might be noted in passing that our policy of furnishing technology
to the U.S.S.R. during World War II, in the light of the present
situation, appears to have been most unwise. Yet I am not one
of those people who believe that our present difficulties with the
U.S.S.R. could easily have been foreseen. At least there appears
to be no valid reason at present for withholding technology from
the other American republics, other than in a few cases involving
security. The history of international trade has amply proven that,
from an economic point of view, an industrialized nation has
nothing to fear from industrialization and other economic de-
velopment abroad. While the pattern of exports and imports will
change, the history of foreign trade has amply proven that the
volume of trade increases rather than decreases under such con-
ditions, and that a higher level of living in both countries results.
In order to indicate the need both for technology and scientific
management in other American republics, I want to comment
briefly upon a particular case history. During my sojourn in
Venezuela, in the early part of World War II, the Pan American
building in Caracas, used by the American Embassy, was enlarged
from two to four stories. The concrete was mixed outside my office







58 The Caribbean at Mid-Century
on the first floor, and was carried in the familiar once-used five-
gallon oil cans to the upper stories by a large group of workers.
Up and down they went, day after day, with cans of cement on
their shoulders. Handling of materials in this manner is probably
little different from the manner in which they were handled to
build the pyramids. Witnessing such crude methods makes a per-
son trained in management positively uncomfortable. A lift could
have been installed without much difficulty to take the concrete
to the upper stories at a substantial saving in manpower and, very
probably, in cost likewise. If leaders in economically underde-
veloped countries, and, in particular, the owners of small industrial
establishments, people in the construction industry, and those who
are engaged in the marketing of goods would take to heart the
lesson of the Galbraith story in the movie "Cheaper By The
Dozen," economic development throughout the world would be
substantial without any influx of foreign capital.
The essential problem of economic development is to make
better use, continually, of the various productive factors, that is, of
economic resources. Of course, the supply of some factors, such
as capital, may need to be supplemented from abroad if there is a
relative scarcity of it and this scarcity is withholding development.
Apparently, however, the fact that productive factors are in part
substitutional is not sufficiently recognized. Capital goods are
labor-saving devices. Obviously, the need for such devices depends,
in most instances, upon the need for saving labor. It made good
economic sense during the late war to build some of our airports
abroad by mass labor, and others by the combined use of compli-
cated earth-moving equipment and a minimum of labor. Labor
was abundant and cheap in certain areas; scarce and costly in
others. In peacetime the financial test of what is cheapest applies
even more strongly. The justification of the importation of capital
goods, therefore, depends largely upon the abundance of labor.
At times, admittedly, the financial test applied to the use of
means for economic development must be set aside. Urgency of
need may suggest that slower hand-labor methods should not be
used on certain projects, even though labor is abundant. Some
military and sanitary projects may be of this character. In this
connection, I am reminded of the loan by the International Bank
for Reconstruction and Development to India for the eradication







ECONOMIC DEVELOPMENT


of kans grass. This deep-rooted grass is known to infest 10,000,000
acres in India of otherwise good agricultural land. Evidently, deep
plowing with heavy tractors, plows, and ancillary equipment is
the only practicable means for its eradication. India expects to
reclaim 3,000,000 acres by this means over the next seven years.
In this instance, hand labor, though abundant, was no match for
capital equipment. Hence it was provided, through a loan, to do
the job. Nevertheless, only simple equipment, such as wheelbar-
rows, small conveyors, and hand tools, not the equipment of Cater-
pillar and Le Tourneau, can often economically be justified on
projects in underdeveloped countries.
It is not sufficiently recognized in underdeveloped countries that
the flow of capital to them depends just as much upon their ca-
pacity and willingness to receive it as upon the capacity and will-
ingness of other countries to make it available. Since the end of
World War II there have been requests from many nations for
assistance in economic development, but very few well-thought-out
programs. The concept of the ability to receive capital implies the
ability to use it productively. Raw materials for a project may be
lacking, or of poor quality, or inaccessible. The demands of the
market may be too small to permit economic production if the
optimum size of the production unit is large. As previously indi-
cated, there may be neither the necessary technology nor man-
agerial ability available. If conditions are not such as to indicate
the likelihood of successful operations and still the project goes
ahead, productive factors will not be used wisely. Economic de-
velopment is not achieved through non-economic projects.
Economic development is a process of slow growth. There must
be a certain balance in that growth, a certain harmony in its var-
ious parts if it does not produce a distorted economic structure.
Projects which are too far ahead of development in other fields
cannot be justified. The construction of roads which lead nowhere
in particular in an economic sense, and the development of power
far in excess of what can presently be used, indicate incapacity to
receive capital for these purposes. In contrast, a key piece of road
between two expanding regions, or a substantial increase in the
KWH capacity of an electric power installation where there is a
pronounced power shortage, indicates capacity to receive capital.
But the capacity to receive capital is much less than most people







60 The Caribbean at Mid-Century
think. In this connection the International Bank stated that "the
most striking lesson which the Bank has learned in the course of
its operations is how limited is the capacity of the underdeveloped
countries to absorb capital quickly for really productive purposes."
While these concepts of growth and balance in economic facili-
ties are not difficult to comprehend, they are difficult to apply in
actual situations. Judgments must be made on the probable rate
and direction of economic expansion. Yet there is usually alto-
gether too little reliable information on which to base such judg-
ments. The situation is further complicated by the fact that some
economic units are not divisible in the sense that they can easily
be adapted in size to the needs of a region. Then, also, the costs
of building economic facilities per unit of output are usually less
as their size increases. Thus, there is strong motivation for too
great anticipation of needs, for building productive capacity much
in excess of present demand. Nevertheless, when this is done the
rate of economic development may be retarded rather than ad-
vanced, for productive factors may have been used unwisely.
Other factors also retard development in the other American re-
publics. Recently we have become increasingly aware of the im-
portance of proper attitudes toward economic activity. Those of
us who are familiar with the economies of the other American
nations feel that there often has been a lack of willingness on the
part of citizens to commit their capital to economic projects; like-
wise, a lack of venturesomeness in economic affairs, of self-reliance,
and of realistic planning for the future. In part, these attitudes
are an outgrowth of the fact that the businessman and the techni-
cal expert are not accorded so high a social status as the lawyer,
the large landowner, the physician, and the diplomat. Business
has not drawn the most able people into its ranks, nor even its
fair share. Industrial technology and business management are
both highly respected in the United States, but they are not con-
sidered as high-level professions in the other American republics.
Moreover, in the past two decades, there has been an increasingly
unfavorable attitude toward direct foreign investments, other than
under conditions unacceptable to investors. Finally, an improper
attitude toward government which is an underlying cause of po-
litical instability is often present and retards economic development
in many countries. These attitudes must change if economic de-







ECONOMIC DEVELOPMENT 61
velopment is to proceed vigorously and along sound lines in the
future.
The principal thesis of this short paper may now be cear. Suc-
cinctly stated, it is that technology, managerial proficiency, and
favorable attitudes are particularly needed for economic develop-
ment in the other American republics and, in general, more so
than a large volume of additional capital. Let me hasten to add
that variations among the republics on these matters, as on others,
are very great indeed, and thus that generalizations are risky. Ex-
cellent work is being done to overcome deficiencies in these factors
in a number of countries. Basically, of course, it is a problem of
education and should be attacked as such. Those in charge of
economic activities should be better prepared for their jobs. There
is no lack of basic industrial aptitudes in the other American re-
publics, but there is a dearth of really effective management.
The question arises of how these factors, which are so greatly
needed for economic development, can best be secured. The prob-
lem is one which must be attacked on many fronts simultaneously.
Both informal and formal education have an important place in
the process. As informal education I would include the increase
in understanding and proficiency secured as the inevitable result
of foreign investment in productive facilities. In my opinion, this
is the best, the most natural, "vehicle" for taking technology and
managerial proficiency abroad. In the field of industrial develop-
ment particularly, there is no good substitute for the knowledge
and experience of private business enterprises. Yet this means is
not being used as extensively as formerly. The amount of direct
investment abroad by North American concerns since World War
II, other than in the petroleum industry, has not been great. Ef-
forts both by government entities and by private groups to stimu-
late direct investment continue, but they have not been successful.
There is too much uncertainty involved. Private capital can adjust
itself to many conditions, but not to extreme uncertainty. Recep-
tivity of other nations toward investments within their borders has
been at low ebb, and the barriers created to investment are formida-
ble. Many informed people in the United States feel that dis-
couragement of direct foreign investment is shortsighted policy,
principally because it withholds the importation of technology and
managerial proficiency, and, therefore, economic development.







62 The Caribbean at Mid-Century
Certain countries, notably Chile, have seen fit to go direct to
the market for the employment of technical and managerial skills.
At one time Corporaci6n de Fomento de la Producci6n de Chile
was currently employing 160 United States technicians and man-
agement experts as full-time consultants in a number of fields. At
times the Export-Import Bank and the International Bank for
Reconstruction and Development have made use of technical
consultants as a condition precedent to the granting of loans for
certain projects. By this means considerable technical knowledge
has been exported to other countries. Government experts in the
fields of public health, agriculture, education, and public adminis-
tration, to name only a few, have been made available, many of
them, as you know, under Public Law No. 63, of 1938. Cooper-
ation in the fields of public health and agriculture has been out-
standing in its results.
The most recently announced and the most widely publicized
plan for cooperation is the Point Four Program. In principle, the
program is sound and fully capable of justification. Our greater
concern is with its administration. The problems involved are dif-
ficult ones and the opportunities present for unwise decisions and
for "busy work," which has no practical application, are many.
However, our experience, both fortunate and unfortunate, with
the projects of the Office of the Coordinator of Inter-American
Affairs, the Interdepartmental Committee on Scientific and Cul-
tural Cooperation, and the Institute of Inter-American Affairs
should stand us in good stead. These projects featured technical
cooperation and assistance. It must be reiterated that the Point
Four Program is of the same general character as the programs of
these other organizations and not a program of foreign investment.
The principal problem involved is the one of finding suitable
personnel for assignments abroad. In this connection, Willard
Thorp, Assistant Secretary of State for Economic Affairs, made
the following statement:

It is difficult to know how many such people can be found, but
this factor more than any other has been responsible for determin-
ing the size of the request made by the administration to the
American Congress. Actually, the estimates underlying the request
provide for 2,445 experts, of whom 1,921 are estimated to come
from the United States. This may seem like a relatively small







ECONOMIC DEVELOPMENT 63
number of individuals, particularly if one thinks of the many coun-
tries involved and the many fields of knowledge. However, if one
thinks of it in terms of locating the individuals, fitting them into
the projects, and actually getting them to work, it is obviously a
tremendous undertaking.*

To anyone familiar with the problems of recruitment, selection,
and training for these assignments, likewise with the problems in-
volved in creating conditions in other countries under which those
assigned can work effectively, even a modest Point Four Program
appears to be a formidable undertaking. While the nation is ac-
tively rearming to meet the threat of Communism, the difficulties
of carrying forward the program are greatly accentuated. It is
unlikely that many technologists or management experts can be
spared for work abroad in the months ahead, unless their work
contributes to the common defense. Nor will placement of the
program under the aegis of the United Nations Organization lessen
the difficulties encountered or make the administration of the
program easier. It may relieve us of charges of officiousness and
economic meddling which may at times have been deserved.
Nevertheless, if the program is prosecuted as vigorously as world
conditions permit, if it is kept within the proper channels and well
administered, it holds much hope for the future.
Finally, there is no good substitute for formal education in tech-
nology and management. Technical schools, trade schools, agri-
cultural colleges, and schools of business administration are greatly
needed in the other American republics, and those now in opera-
tion need strengthening. If it is recognized that economic develop-
ment is, in large measure, a product of education, assistance in
providing buildings, staff, and libraries may be forthcoming.
Training, such as that given in the Inter-American Institute of
Agricultural Sciences at Turrialba, Costa Rica, and through the
agricultural program of the Rockefeller Foundation in Mexico,
will do more in the long run to stimulate sound economic growth
than any other type of effort. While the need is not so apparent,
formal training is also needed in the technology and management
of industry, and must soon be provided if the levels of living are
to be substantially improved in the other American republics.
Willard L Thorp, "Practical Problems of Point Four," Tha Annals of
the American Academy of Political and Social Science (July, 1950), p. 98.







5





Manuel A. Mesa: LATIN AMERICA LOOKS AT
INTER-AMERICAN TRADE

(Translated by Julio Morales and David Hellyer)


DURING the limited period of time at my disposal, I will speak
to you about the present and general condition of Latin American
trade and of its trends or possibilities, even though the topic in-
volves diverse and complicated problems brought about by social-
economic factors as well as the universal necessity of being a "good
neighbor." To consider only inter-American trade at this time
when the world is shrinking more and more in its economic rela-
tions, would be like admitting the possibility that a particular region
in the world could establish an economy isolated from all the other
nations of the world.
Before going any further, let us make clear what we mean by
Latin America. This region is usually understood to comprise the
countries south of the Rio Grande; twenty republics, each with its
own government and each considered independent and autonomous
in its political organization and in its economic policies. However,
some of them-or, better still, next to them and among them-are
certain non-autonomous islands in the Caribbean Sea, and the non-
autonomous territories of Belize (British Honduras) and the
Guianas. All belong to the same geographic region as their Latin
American neighbors, with similar natural and social status, common
economic problems, and commercial relations which are closely
tied to the economy of the geographic region called Latin America.
In many books and by many people this section of the world is
named Hispanic America. But neither the former nor the latter
name is accurate, for not all the people living in this region are







INTER-AMERICAN TRADE


Latin or Hispanic, and it is impossible to find a suitable definition
in reference to their origin or their race. At any rate, since that
section of the American continent discovered and colonized by
Spain is in common usage called Latin America, and because this
entire region has similar economic conditions and common social
problems, I shall try to analyze its commercial status and such
trends as are in evidence today.
The analysis of these problems, however, should include those
Caribbean countries which do not have self-government and which
are, therefore, not considered part of the region designated as Latin
America. Lack of statistical data compels me to limit largely my
observations to the twenty independent countries that politically
constitute Latin America. My observations are based on research
done within the past few years by the United Nations' Economic
Commission for Latin America.
In these countries, international trade has followed the general
economic development of the world. While these New World areas
were colonies or subject to Spain, all imports and exports were
carried out with that nation, which was the sole intermediary for
the exchange of merchandise with the other nations. Spain was
then the economic center of a world in which its colonies formed
the periphery. Later, as you well know, economic conditions
changed, a shift in the commercial centers of the world occurred,
and other powerful nations assumed trade leadership in both
volume and value of consumers' goods.
But in all ages, in spite of trade barriers of lesser or greater
strength, there is an interdependence of interests and commercial
relations, of influences and mutual or reciprocal aims that deter-
mine international commerce. The economics of colonial times
provided the key to the colonial state of commerce; the economic
equilibrium, like liquids which in a series of connected containers
will seek the same level, sought to follow the relationship between
cost and price, and supply and demand.
However, it was not then, and is not today, a simple matter to
maintain this state of equilibrium. Even when Spain controlled the
greatest part of Latin America, economic interests antagonistic to
her own interfered. And when the colonies achieved their inde-
pendence, they gravitated to new centers, to those which in Europe
were assuming economic predominance. The one which assumed







66 The Caribbean at Mid-Century
leadership in international trade with the former colonies was the
United Kingdom, and this leadership lasted until approximately
1850. One hundred years later we find ourselves in a new situation,
with new trends and possibilities we wish to understand, analyze,
and explain, in an effort to serve the common interests of. ...
Here I pause and find that it is not easy to say in whose interest
such investigations should be. Perhaps those of the present eco-
nomic center, or those in the periphery? Perhaps those with self-
government, or those that are not independent? Perhaps those that
supply only raw materials, or those that change these raw materials
into the finished product? Or, for the benefit of those that buy,
or those that sell?
It is not easy, as you can well see, to define this interest, and
to point it in one direction, when there are so many complex cir-
cumstances and factors that determine commercial interchange and
its consequences.
As for myself, being Latin American, I believe that the upper-
most interest should be for the good of all the people. In each
country this interest should be analyzed in relation to its natural
resources, and so adjusted as to achieve economic freedom for the
greatest number possible, without those special privileges which
tend to make peoples economically dependent, and which bind
them in that status we now call "underdeveloped."
The common practice among all Latin American countries, as
well as in non-autonomous areas in the Caribbean, is, and has been,
to supply raw materials to manufacturing centers. These raw ma-,
terials are then processed, and later sold back to the suppliers in
the form of agricultural, forestry, mineral, and grazing products.
The raw materials taken from the land require much labor, but
are sold at a low price. However, the finished products are, in
turn, offered at higher prices by those who manufacture. Very
little labor is involved in much of this manufacturing, although
large amounts of capital are invested.
Latin America is limited in its sales to more industrialized coun-
tries to those articles which natural resources and limited capital
allow its various countries to produce. The number of raw ma-
terials, and in some places the number of articles, is one in a
country. Before the last war, exports of primary products were as
follows:







INTER-AMERICAN TRADE

Cuba: sugar 70%, tobacco 10%
El Salvador: coffee 87%
Guatemala: coffee 65%,
bananas 27%
Haiti: coffee 50%
Honduras: bananas 57%
Jamaica: bananas 60%,
sugar 17%
Nicaragua: coffee 35%
Panama: bananas 74%
Puerto Rico: sugar 67%
Argentina: meats 23%,
cereals 26%


Bolivia: tin 71%
Brazil: coffee 45%
British Guiana: sugar 58%
Chile: coffee 48%, nitrates 21%
Colombia" coffee 53%,
petroleum 22%
Ecuador: cocoa 30%
French Guiana: lumber 48%
Paraguay: cotton 37%
Peru: petroleum 34%,
cotton 18%, copper 17%
Uruguay: wool 44%, meats 21%
Venezuela: petroleum 92%


Other countries like Mexico, Costa Rica, the Dominican Republic,
and some of the islands in the Caribbean, have more diversified
lists of exports, but such lists are made up also of raw materials,
sometimes being foodstuffs, or articles destined for manufacturing
in other countries.
Prices of primary products in certain markets changed in 1947
as compared with 1938 from a price index of 665 for cocoa down
to 142 for rubber, which means that prices of these export articles
have gone up. But this increase does not keep pace with the varia-
tion in the exchange during the postwar period as compared with
that during prewar days. A study made in the United Nations
concerning relative prices of exports and imports of underdeveloped
countries, which include all the Latin American countries and
other places in the Caribbean area, shows that exchange during
the postwar and prewar periods is, in Central America (including
Mexico), favorable in eight countries, not favorable in seven, and
that there was no change in two. In South America, it is better
in four, worse in five, with no change in two. This same study
analyzes the quantum index prices of the different industrial arti-
cles imported, which shows that the variation is favorable in some
cases to the countries exporting raw materials, but in many others
unfavorable. For instance, the quantum index of textiles imported
as compared with exports of raw materials is unfavorable in Brazil
(81), Chile (58), British Guiana (50), French Guiana (73), Haiti
(72), British Honduras (59), Mexico (87), Peru (61), Puerto
Rico (55), and Venezuela (99). The quantum index with respect
to foodstuffs and beverages has also gone down in the following







68 The Caribbean at Mid-Century
countries: Brazil (78), Colombia (80), Cuba (78), Chile (46),
British Honduras (64), Mexico (71), and Peru (63). These in-
dices show much variation among the different countries, without
any well-defined trends, but with diverse variations which often
are compensated for partially or totally. Moreover, the cases men-
tioned are important because textiles and foodstuffs are the main
import articles for some Latin American countries.
In spite of this wide variety of conditions shown by the studies
of the United Nations, one thing is very dear: Latin American
countries, as far as commercial relations are concerned, depend
principally on the more industrialized countries, and more par-
ticularly on the United States. This dependence has, during critical
or war periods, caused economic depression, dislocations, and in-
stability. For this reason, Latin American countries have redoubled
their efforts in the last 25 years to lessen this dependence by export-
ing different articles, and by industrializing their own natural re-
sources and processing their own raw materials. In some cases,
lack of economic organization prevents their accomplishing some
of these aims, while in others they are unable to help themselves
because of outside factors which militate against their self-develop-
ment.
Let us analyze now the present state of international commerce
in Latin America. Total exports and imports for the years 1947,
1948, and 1949 amounted to (in millions of dollars) 5,899, 6,502,
and 5,577, respectively, for exports, and 5,982, 5,884, and 5,313,
respectively, for imports. If we compute the percentage of exports
in each country as compared with the total in Latin America, in
1949, we find Brazil first with 19.68%; then follows Venezuela
with 18.64%; Argentina, 17.58%; and Cuba with 10.93%. Thus,
these countries accounted for 66.83% of the total exports in 1949.
Concerning imports, Brazil accounts for 21%o of the total; Argen-
tina, 20.32%; Venezuela, 14.09%; and Cuba, 9.16%; the total of
these four countries is 64.57%. The above shows that the volume
of international Latin American commerce is traceable to a few
countries, and we must bear in mind the fact that the four coun-
tries responsible for this large percentage export a small number
of products. In Cuba, for example, exports are limited chiefly to
raw sugar and tobacco, whereas in Venezuela petroleum is the only
important export. The other countries are relatively unimportant







INTER-AMERICAN TRADE


with reference to their volume of imports and exports. It should
be pointed out further that the leading products are the same in
some countries, but are produced under different circumstances
that influence cost and price. Coffee, for instance, is exported by
many countries of the Caribbean area and in large quantities by
Brazil, Colombia, and Ecuador. Bananas and cocoa are exported
by many Caribbean countries. Among fibers, cotton is exported by
Haiti, Mexico, Nicaragua, Brazil, and Paraguay; sugar is exported
by Cuba, Dominican Republic, Guadaloupe, Haiti, Jamaica, Mar-
tinique, Puerto Rico, Trinidad, Tobago, British Guiana, and Peru,
and lately, although on a small scale, by Mexico; beef, hides, and
furs also are exported by several South American countries. It
might be said, therefore, that there exists no specialization of ex-
ports which is determined by natural resources, commercial con-
ditions, or economic organization. The only exceptions in this
respect are Bolivia, which is the only country that exports tin;
Chile, with its nitrate exports; and Venezuela, with petroleum.
The evolution of foreign trade in Latin America has demon-
strated in the past few months, even more so than in the past
years, the important role it plays in the economy of these nations.
In some cases a decrease in commerce, and in others a threat of
such a decrease, influences economic policies, which are directed
towards the maintenance of the volume of exports. In 1948, the
total value of exports from countries south of the Rio Grande
reached such proportions (6,500 million dollars) that attention
became fixed above all on the necessity of guarding against ex-
cessive importations. During that same year, only five countries
exported less than the previous year, and among these Cuba under-
went the greatest decline (49 million dollars). But, since exports
reached a total of 720 million dollars, the country enjoyed a
favorable trade balance.
During 1949 Latin American exports decreased to approximately
5,570 million dollars, which represented a shrinkage of some 900
million dollars as compared with 1948. There are eleven Latin
American countries whose exports decreased in value, and in some
cases this decrease was considerable. The value of Argentine ex-
ports went down by more than 600 million dollars; Cuba, 100
millions; Chile, nearly 30 millions; and Venezuela, about 70 mil-
lions. In spite of this, the balance of Latin American trade was







70 The Caribbean at Mid-Century
favorable in 1949, but this favorable balance, which exceeded 600
million dollars in 1948, was reduced to 250 million dollars in 1949,
even though imports were reduced by 550 million down to 5,300
million dollars.
A study of Latin American exports shows that the only im-
portant products whose sale shrank considerably were metals,
principally lead, copper, and tin, which are exported mostly by
Chile and Bolivia. Argentina experienced the worst decline, which
was due to a decrease in production of export products as well as
to the loss of its European markets. "The main difference in the
present conditions and those during 1947-48 is not so much the
accumulation of exportable supplies as (1) the interruption of the
rise in prices; (2) the strong proportionate decline of prices in
some countries; (3) the lack of security of future exportations; (4)
the general alarm caused by the economic recession that occurred
at the beginning of 1949; (5) the observation that some exports
have been maintained artificially because of Marshall Plan pur-
chases or North American programs to sustain price levels or to
stockpile; (6) and finally, because of the process of monetary ex-
pansion and the interruption of price increases in exportable prod-
ucts, costs crept up to the prices, while in previous years prices
increased more than costs."*
In Argentina, cereal production and, to a lesser degree, wool
production suffered a large decline. In Chile, copper production
suffered similarly. In fact, Argentine exports of wheat in 1949 de-
clined by 340,000 tons, corn by 1,450,000 tons, and barley by
400,000 tons. In the same way that production of exportable
products showed a decline in a few items, so an increase has taken
place in some items, but none as great as the decreases. The im-
portant increase recorded is that of cotton in Mexico, where, as a
result of irrigation projects completed, production rose from 570,000
bales in 1948 to over 900,000 in 1949. The rise of production of
cotton in Brazil during 1949 above 1948 was not sufficient to
match the 1940-44 figures, but in 1950 another rise is expected.
The production of sugar, which declined in Cuba and which re-
mains more or less stationary in the other exporter countries, in-

Studio Econdmico de Amdrica Latina 1949. Comisi6n Econ6mica
pars America Latina.







INTER-AMERICAN TRADE


creased not only in the deficit-ridden countries of Latin America,
but also in those which export small quantities, like Mexico.
Accumulation of inexportable stocks happened in a few cases of
minor importance in total trade, but resulted in quite a strain on
those countries affected. Ecuador's rice production and Nica-
ragua's sesame oil production are examples. On the other hand,
Brazilian stocks of coffee, accumulated since the war, disappeared
in 1949, and Argentina sold her excess stocks of cereals, principally
to European countries and, to a small extent, to India, Japan,
Paraguay, and Peru. In Mexico, where silver had become quite a
problem, sales to the Near East and Far East reduced to normal
the amount of stock on hand.
During the last few years, Latin American trade with the United
States has increased, to the detriment of trade which previously
existed with Europe. Data taken from Foreign Commerce Weekly,
of the United States Commerce Department, reveal that United
States imports from Latin America totaled 2,303.8 million dollars
in 1949, an amount which, when compared with the 1936-38
average of only 524.4 millions, indicates a large increase that is
accounted for by conditions well known to everyone.
As to the United States exports to Latin America, there has also
taken place a large increase, to wit, from an average of 486.6 mil-
lion dollars annually for 1936, 1937, and 1938 to 2,712.4 millions
in 1949. Official statistics gathered by the International Monetary
Fund reveal that European imports from Latin America declined
from 2,596.11 million dollars in 1948 to 1,692.57 millions in 1949,
while exports from Europe to Latin America totalled 1,313.04
million dollars in 1948, and 1,305.58 million dollars in 1949.
The principal products exported by Latin America to the
United States are, at present, coffee, cane sugar, metals and some
of their finished products, raw and semi-finished copper, lead, tin,
cryde petroleum and some of its derivatives, textile fibers and their
manufactured products, raw wool, sisal hemp, cocoa, bananas,
cottonseed and vegetable oils, nitrates, tobacco, furs and hides, and
various vegetable products. The United States Department of
Commerce estimates the value of these exports at 2,140 million dol-
lars in 1947, 2,323.3 millions in 1948, and 2,295.9 millions in 1949
--amounts that represent during these years about one-half of the
total exports of Latin America. The mere reading of the above







72 The Caribbean at Mid-Century
list of articles, and consideration of the fact that many of them
are produced by several countries for the sole purpose of export,
show how difficult it would be to modify the foreign trade of
Latin America, especially when it is noted that these regions do
not have any diversification.
The principal products exported by the United States to Latin
America during the years 1947, 1948, and 1949 were: industrial,
electrical, agricultural, and other machinery; automobiles and ac-
cessories; iron and steel products; chemical and pharmaceutical
supplies; wheat, rice, and other vegetable foodstuffs; finished tex-
tile products; meats, lard, milk, and other animal products; ships;
petroleum and its derivatives; and other merchandise. The total
dollar value of these exports to Latin America for the above years
was 3,830.2 millions, 3,139.5 millions, and 2,694.1 millions, re-
spectively. The largest percentage (39.7%) of the value of exports
for the year 1949 was for machinery.
Owing to several well-known factors, among them the one al-
ready mentioned that many Latin American countries produce the
same kinds of goods, trade among them always has been very lim-
ited. We persist in pointing out that, as none of these countries
can foster large-scale industrial development aimed at industrializ-
ing these raw materials, it is only natural that trade among Latin
American nations is limited. Furthermore-and this is a very sig-
nificant circumstance-the majority of the countries own no fleet
and must perforce ship in bottoms of other more developed nations.
The value of exports among Latin American countries was re-
duced in 1949 to an estimated 450 million dollars, as contrasted
with the 1948 total of 600 millions. Although these are figures at
current prices, they are about four times greater than those for the
years 1938 and 1928. This increase in trade among Latin Amer-
ican nations is chiefly the result of fluctuation in prices. It has
been calculated that, based on 1938 prices, the trade in 1949 is
about 25 per cent less than in 1948, but about 30 per cent more
than in 1938. At any rate, intra-regional commerce seems to have
increased at a faster rate than commerce with outside countries,
since the total value of exports computed at 1938 prices rose by
30 per cent in 1948 as compared with that of 1938, while exports
among themselves went up by approximately 60 per cent. How-
ever, intra-regional exports declined in 1949 much more than total







INTER-AMERICAN TRADE


exports when figured at current prices. If stabilized prices are
used, then the relative decline between the former and the latter
is a great deal less. These results might be attributed to the fact
that the majority of goods traded between the Latin American
nations were foodstuffs and raw materials, and these are products
whose prices declined more than those of the manufactured prod-
ucts that make up the bulk of extra-regional trade.
In Latin America the importance of export markets differs in
each of the countries. When this importance is measured in pro-
portion to the exports absorbed, it appears to be greatest for
Ecuador, Paraguay, and Peru, and least for Argentina, Brazil,
Chile, El Salvador, and Uruguay. On the other hand, the largest
part of intra-regional commerce is carried by the southern part of
South America-Argentina, Bolivia, Brazil, Chile, Paraguay,
Uruguay, and also Peru, which is to the north. This group of
countries was responsible for 88 per cent of the total trade in 1928,
88 per cent in 1938, 80 per cent in 1948, and 86 per cent in 1949.
The analysis that we have just completed, though brief and in-
complete, demonstrates that commercial intercourse in Latin
America is subject to conditions and circumstances which are very
difficult to modify in a short period of time. Many factors and
obstacles impede the organization of its economy for the purpose
of increasing production of goods from its natural resources, and
of developing industries to use raw materials which heretofore
have been sold to other industrialized nations. Nonetheless, the
predominating trend is to break through these obstacles in order to
improve the standard of living and to correct wherever possible
the imbalance in special circumstances.
It cannot be said, therefore, that the trend of trade in Latin
America is toward greater interchange among the Latin American
nations. On the contrary, during the postwar period the barriers
limiting trade with Europe have been pushed aside, and now Latin
America is planning to recuperate lost markets in Europe as well
as in other countries. In the last conference of the Economic Com-
mission for Latin America, which took place in Montevideo in
June this year, a resolution was adopted which provided for a
study of conditions of commercial trade in Europe, with the evi-
dent purpose of increasing and diversifying markets for Latin
American raw materials and the purchase of industrial products







74 The Caribbean at Mid-Century
needed. This desire and purpose are evidently convenient as long
as the commercial conditions are as I have presented them to you.
It is clear that the economic development of Latin America under
present world conditions tends and should tend toward making
each country more independent in the sense that each should satisfy
its own needs with its own natural resources. To accomplish this
it will be necessary to change substantially the products in foreign
trade, even though the organization of a rational economy should
call for each country to produce those things for which it is best
fitted. As long as production is carried out with the present aims
in view, it is difficult to visualize the possibility of thus organizing
the economy. Many and profound changes will have to come
about before Latin America will steer its production in accordance
with the natural and economic possibilities of each country. Re-
gardless of the changes that may come, one must take into con-
sideration the insurmountable difficulties of restricting trade to fit
the necessities or conveniences of the American continent.




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