The Caribbean : contemporary trends

SERIES OPIE

SCHOOL OF

VOLUME III

A publication of the
I nT ER-AMERICA I STUDIES

which contains the papers delivered at the third annual conference on the
Caribbean held at the University of Florida, December 18,19, and 20, 1952.

ISSUED WITH ASSISTANCE FROM
THE 97ALTER B. FRASER PUBLICATION FUND

The

CARIBBEAN:

CONTEM PORARY TRENDS

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1953
UNIVERSITY OF FLORIDA PRESS
Gainesville

The

CARIBBEAN:
CONTEMPORARY TRENDS

edited by A. Curtis Wilgus

AGiRi
CULTURAL
LIBRARY
Copyright, 1953, by the
UNIVERSITY OF FLORIDA
ALL RIGHTs RESERVED

A University of Florida Press Bool

L. C. Catalogue Card Number: 53-11390

Printed by

THE H. 19 W. B. DREW COMPANY
JACKSONVILLE, FLORIDA

JOHN AKIN, Director, Western Hemisphere Division, National
Foreign Trade Council, Inc.
RICARDo J. ALFARO, President, International Law Commission;
Former President of the Republic of Panama
FRANK K. BELL, Vice President, Alcoa Steamship Company, Inc.

JOHN BIESANz, Associate Professor, Department of Sociology
and Anthropology, Wayne University, and MAVIS BIESANZ
R. S. BOGcs, Director, Hispanic-American Institute, University
of Miami
MIRON BURGIN, Chief, Division of Research for American Re-
publics, Department of State
JAMES B. CHILDs, Chief Documents Officer, The Library of
Congress
HAROLD E. DAVIs, Director of Inter-American Studies, The
American University
JOHN C. DREIER, United States Representative on the Council
of the Organization of American States
JosiE GOMEz SICRE, Chief, Visual Arts Section, Pan American
Union
GILBERTO Lovo and RAIL ORTIZ MENA, Escuela Nacional de
Economia, Universidad Nacional Aut6noma de Mixico

J. HILLIS MILLER, President, University of Florida
EUGENE B. MIROVITCH, Vice President for Latin America, Mer-
genthaler Linotype Company

Conttributors

vi The Caribbean

E. A. NORTON, Assistant Chief, Soil Conservation Service, De-
partment of Agriculture
MISAEL PASTRANA, Minister Counselor, Embassy of Colombia

LuIs QUINTANILLA, Ambassador of Mexico to the Organization
of American States

SIR HUBERT ELVIN RANCE, Governor and Commander-in-Chief
of Trinidad and Tobago, B. W. I.
FERNANDO RIVERA, Head, Latin American Section, Public Ad-
ministration Division, United Nations Technical Assistance
Administration

CARL C. TAYLOR, Head, Division of Farm Population and Rural
Life, Department of Agriculture
RAFAEL HELIODORO VALLE, Ambassador of Honduras to the
United States

FRANCIs VIOLICH, Associate Professor, Department of City and
Regional Planning, University of California
A. CURTIS WILGUS, Director, School of Inter-American Studies,
University of Florida

ONCE AGAIN a successful conference on the Caribbean has
been held under the joint auspices of the University of Florida
and the Aluminum Company of America through its subsidiary,
the Alcoa Steamship Company, Inc. We feel that we have
inaugurated on our campus a valuable means for the study
and analysis of the problems of an important region of Latin
America. We are especially delighted that students, scholars,
businessmen, and government officials from the countries of the
hemisphere can come together for the exchange of ideas re-
garding this area. Publication of the papers read each year at
these meetings will give the deliberations of these authorities a
permanent quality in a series of volumes available to students
of the Caribbean. The searchlight of expert criticism and
judgment directed at the countries immediately south of us
helps in understanding all aspects of their civilization and cul-
ture. For the Caribbean today is a laboratory where all phases
of broader Latin American problems may be examined in an
empirical fashion. Therefore, our continued concentration on
the Caribbean, for the time being at least, seems highly desir-
able. It is our firm belief and hope that eventually this con-
tinued cooperative effort by contributors to the conferences
will result in benefits to the peoples and governments of the
area itself.

J. HILLIS MILLER, President
University of Florida

Foreword

Conttents

Map of Caribbean Area ......Frontispiece
List of Contributors ........... v

FOTOWord-J. HILLIS MILLER......... VII
Introduction--A. CURTIS WILGUS . .. . . Xi

Part I ECONOMIC TRENDS

1. E. A. Norton: CONSERVATION PROBLEMS IN THE
CARIBBEAN AREA ..... 3

2. MlrOH BurglH: SOME PROBLEMS OF ECONOMIC DE-
VELOPMENT IN THE CARIBBEAN AREA. .. 15

3. Gilberto Loyo and Rai'l Ortiz Mena: PROBLEMS
OF UNDERDEVELOPED AREAS IN THE CARIBBEAN 27
4. Frank K. Bell: TRANSPORTATION IN THE CARIBBEAN 36

5. John Akin: ENVIRONMENT FOR UNITED STATES
ENTERPRISES IN THE CARIBBEAN ... 47

Part II SOCIAL TRENDS

6. Carl C. Taylor: SOME LAND SITUATIONS AND PROB-
LEMS IN CARIBBEAN COUNTRIES. 59
7. Francis Violich: URBANIZATION IN VENEZUELA--
AN OBJECT LESSON FOR THE CARIBBEAN AREA 74

Part III LITERARY AND ARTISTIC TRENDS

8. R. S. Boggs: CARIBBEAN BALLADS OF THE
SPANISH CONQUEST ..... 91

x The Caribbean

9. JosC G6mez Sicre: SOME ASPECTS OF ART IN THE
CARIBBEAN AREA .....100

10. Rafael Heliodoro Valle: HISPANIC AMERICAN JOUR-
NALISM IN THE CARIBBEAN AREA ...114

11. Eugene B. Mirovitch: LATIN AMERICAN PUBLISHING
AND PRINTING-IMPRESSIONS OF TWENTY-FIVE YEARS .121

Part IV~ POLITICAL AND DIPLOMATIC TRENDS

12. Harold E. Davis: POLITICAL PHILOSOPHIES IN
THE CARIBBEAN .....141

13. Fernando Rivera: THE CIVL SERVICE--ITS IMPOR-
TANCE FOR A SOUND ECONOMIC DEVELOPMENT PROGRAM 160

14. Ricardo J. Alfaro: OLD AND NEW DIPLOMACY . 172

15. John and Mavis Biesanz: UNCLE SAM ON THE ISTHMUS
OF PANAMA--A DIPLOMATIC CASE HISTORY .. 185

Part V PEACE AND SECURITY TRENDS

16. John C. Dreier: THE RIO TREATY AND HEMISPHERE
DEFENSE .......205

17. Luis Quintanilla: PEACE AND COLLECTIVE SECURITY
IN AMERICA .. . .. 214

18. Misael Pastrana: PAN AMERICANISM--ITS CONTRIBU-
TION TO WORLD PEACE . . 226

19. Sir Hubert Elvin Rance: TOWARDS A FEDERATION OF
THE BRITISH WEST INDIES ....241

20. James B. Childs: CARIBBEAN AND SOUTH AMERICAN
TREATY MATTERS--A CONSIDERATION OF SOURCES 257

Index . . . . . . 287

BASIC to an appreciation of present "trends" in the Carib-
bean area is an understanding of political and constitutional
development during more than a century. Too often we in
this country lose sight of the fact that in their political practices
and psychoses the people south of us are acting historically
and, as viewed by themselves, logically. Hence an understanding
of the practical politics of these peoples is fundamental to a
comprehension of their social, economic, and cultural life.

Past and present political trends in the Caribbean area are
both interesting and instructive. Like the United States, each
of the countries has a constitution. The first constitutions of
these countries were created after they had won their inde-
pendence, several being copied, with some changes, from that
of the United States. In seeking independence some of these
states also adapted our Declaration of Independence to their
needs. And when they had achieved independence, they natu-
rally set up governments with many of the characteristics and
political practices of the great republic to the north.
Constitutions in Latin American countries vary greatly in
length. When the first ones were written, the framers tried
to limit their political instruments to relatively few words; but
today the Mexican constitution contains about forty-five thou-
rand words, whereas ours, by way of contrast, contains about
Forty-four hundred words. It is difficult for the Latin American
:0 say anything briefly; since the constitutions are literary as
lyell as political documents, many words must be used in their
instructionn.

Introduction

xii The Caribbean

In the more than a century since the first constitutions were
formed, their contents have undergone numerous modifications.
In some cases ideas from the British constitution have been
added; in other instances, ideas from the French constitution.
Often the revisionists were not content simply to take ideas from
other peoples but added their own views of what government
should be. Sometimes their constitutions became political patch-
works so that it was impossible to use them efficiently.
In Latin America a national constitution is often considered
first and foremost a literary masterpiece. Many of the people
who put together constitutions are literary men. They think
in terms of legal fiction rather than in terms of practical policies.
Sometimes a constitution is formulated to meet a particular
situation, only to be discarded later in favor of another. A
constitution sometimes is used to try out political ideologies
which may be wholly impracticable. Very often it carries more
philosophical verbiage than workable ideas. Constitutions are
often used by dictators to camouflage their dictatorships.
Let us look at Latin American governments in general and
try to analyze the political psychoses behind the practical
politics as conceived by many Latin American political leaders.

Each constitution has an amending clause. In the early con-
stitutions of the last century this clause followed the phraseology
used in our own Constitution; but the method proved too slow
for volatile Latin American political temperaments. As a result,
a clause was incorporated into some constitutions which stated
that the constitution might never be amended, or that it might
be amended only at the end of a period of years. In some
instances the national legislative body might amend the constitu-
tion. But no matter what system for amending the constitutions
was provided, all methods proved too tedious. The simplest
process to use in constitutional amendment was to abolish a
constitution and replace it by an entirely new one. As a result,

INTRODUCTION

a number of the states have had a dozen or more constitutions
in little more than a hundred years. This frequent change
has been justified on the ground that "change is a sign of
progress." The United States, some Latin American leaders
believe, has lagged behind in constitutional development since
we have had one constitution for so long a time.

III

The franchise in Latin American constitutions was decidedly
limited during the first century of political development. Many
people were denied the right to vote. Included among these
were members of the military, persons whose income had not
reached a certain level, daily laborers, all who worked at menial
tasks, inmates of criminal and charitable institutions, and, until
recently, all women. In most of the countries today men are
allowed to vote at the age of 21 and women, when they have
the right, at the age of 18. In some countries if a man is married
and 18 he may vote.
Generally, college students because of their age do not have
the right to vote; but in many countries they exercise an in-
fluence in politics out of all proportion to their numbers. Most
Latin American students graduate from college about two years
earlier than those in the United States. This is chiefly due to
the fact that the Latin American student completes only ten
grades instead of twelve before he begins his higher education.
This means that the average age of the university student at any
level in Latin America is about two years under the average age
at the same level in our own universities.
Students in Latin America, as in this country, are extremely
interested in political affairs. The instructors in universities are
frequently professional men--lawyers, doctors, and others--who
teach part time to augment their salaries or because they enjoy
the work. When a political campaign occurs in a Latin Ameri-
can country, many of these part-time teachers take an active
part. They cannot, of course, avoid talking in class about po-

The Caribbean

litical subjects, whether the course is in the sciences or other
fields of knowledge. And the students there, as elsewhere, always
like to have the professor get off the classroom subject and talk
about something of greater interesting In consequence, the profes-
sor often influences his students to support his favorite candidate.
This support may take the form of student soap-box speeches on
the street corners in favor of a particular candidate. As the
citizens listen to these orators, they in turn are often influenced
by what they hear. For are not these students educated and are
they not obviously thinkers in matters of politics?
As a political campaign draws toward an end and the day of
election approaches, students at the university will frequently
hold a political rally. This may be a torchlight procession in the
evening, or it may be a daytime parade. In any case, the stu-
dents usually display banners and placards with slogans and their
candidate's name. When such a procession is held, the citizens
along the street may take exception to the slogans and hurl mis-
cellaneous objects at the students. The latter will usually react
in like manner and frequently a small riot develops.
Thereupon, the police are called out. They usually arrest the
student leader and take him to jail, where he is to be kept over-
night. Even though the procession may be broken up by the
police, the students are likely to re-form in front of the jail and
rescue their leader. His arrest has been taken by each of the
paraders as an individual insult and a blot on the university's
good name. The rescued leader will be carried back to the uni-
versity buildings on the shoulders of his friends. There the stu-
dents will barricade themselves and defy the police to come
and retake their leader. Shortly, the news of this disturbance
spreads all over the city. Friends and relatives line the side-
walks outside the university buildings and cheer on the students,
who thereby acquire a feeling of self-importance and the assur-
ance that they are supported by the townspeople in their stand
for the candidate.
Finally, stubborn student opposition may go so far that the
army is called out to threaten the students with expulsion by

INTRODUCTION

force from the university buildings. This makes the students
even more defiant, and the chances are that they will now begin
to destroy school property, throwing chairs, tables, typewriters,
and so on, out of the windows. Possibly the fire department will
attempt to shoot water through the windows to dampen the
students' ardor.
Sooner or later the president of the republic, who usually has
the right to appoint the president or rector of the university and
to assist in organizing the curriculum, will take a hand. He may
order the university to be closed and tell the students to go home
since there will be no more classes for some time--occasionally
for years!
When students demonstrate in this manner, it is often a signal
for persons engaged in transportation and other activities to go
on strike out of sympathy for the students. These individuals
probably have been thinking of striking for some time but they
have lacked the incentive, the opportunity, the courage. A stu-
dent disturbance makes their strike possible. Thus, a great deal
of attention may be called to a political candidate by virtue of
the activities of students who cannot vote.

I'V

Elections are held in Latin American countries on holidays
and holy days, since more people are free to vote than on week-
days, when many are engaged in various business and labor
pursuits. The polling places are usually open from early in the
morning until sunset. The army generally serves as police to
watch the voting. This fact is considered by many to be a form
of intimidation practiced by the government to insure that its
particular candidate may win the election. In some countries
voting is compulsory and secret.
For several generations in a number of Latin American coun-
tries it has been the custom for persons who have the right to
vote to exercise this political privilege as often as they find it
possible during a single election. This is true especially if they

The Caribbean

receive pay for each vote. Even participation of women in
politics does not improve the political morals or the standard
of honesty in voting. In more and more countries it has become
customary to mark a finger of each voter with some sort of
indelible ink after he has exercised his franchise. This sign
cannot be removed before the voting places are closed in the
evening, and therefore he is unable to vote more than once. It
is also proof that the voter has performed his patriotic duty
toward democracy.
Women have been voting in Latin America in increasing
numbers in the past two decades. Following the first World
War a number of American suffragettes discovered that Latin
American women did not have the franchise. They also dis-
covered that the constitutions of most Latin American countries
did not actually exclude women from voting. Apparently no
one in Latin America who formulated constitutions had given
much thought to the possibility that women might some time
wish to have the vote. When the good ladies from the United
States called these facts to the attention of political leaders in
Latin America and asked why women could not vote, the men
suddenly awoke to the startling fact that the women were, ac-
cording to the constitution, not excluded from the franchise.
They immediately set about remedying this defect! As a result,
the women of Latin American countries began to organize
themselves, demanding the franchise. Slowly one country after
another amended its constitution, or devised a new one, which
allowed women to vote and to hold office. Today more than
half of the republics allow women to vote. In some instances
women may vote but cannot hold office; in other instances they
can hold office but cannot vote. Sometimes they may vote in
municipal elections but not in state and national elections. How-
ever, at the present time women in all Latin American countries
are becoming politically conscious and are using the right of
suffrage to make many improvements and changes in their
social and economic status.

XV11

INTRODUCTION

Every Latin American constitution provides for a national
legislature. In a few instances in the past century the legisla-
tures have consisted of one house, but in present-day practice
they usually consist of an upper and a lower house, patterned
somewhat after our own Congress. The upper house may be
called a senate or some other name. In any case, it is very similar
to our upper house of Congress and members have many of the
same functions and privileges that our senators have. Members
of the lower house are usually elected on the basis of proportional
representation. Their privileges correspond to those of the mem-
bers of our House of Representatives. In some instances con-
gressmen are chosen for a two-year term or a four- or six-year
term. They all enjoy inmunities similar to those enjoyed by
members of our congress.
Everyone in Latin America interested in politics hopes some
day to achieve a position where he can make rules or regulations
or laws for other people. In colonial days when there was a
king who made the laws it was believed that the ruler could do
no wrong. It was also believed that the king was above the law.
Naturally, the king would make no laws which would limit his
authority. Nowadays lawmakers like to think of themselves as
potential kings, above the law. Hence they make laws for other
people. They do not necessarily expect to obey the laws them-
selves, because that might limit their rights of making laws. They
feel that the laws they make are necessary and good; otherwise
they would not be trusted to make laws. They have great respect
for law, because it is something to which they have given a
great deal of study and thought. They do not always obey laws,
however, despite this respect. Take for example traffic laws.
Red and green lights are provided to control traffic. A man
hurrying to keep an engagement for which he is already late
does not stop at a red traffic light, because he believes that the
law was made by a person who felt that no one should be late
for an engagement just because the traffic light happened to

xviii The Caribbean

be red. These laws were made for other people, not for him.
Lawmakers in Latin America frequently feel that they have
a commodity for sale. Or if they have friends who need as-
sistance, they may be able to modify the law in their favor.
Hence, favoritism and the spoils system are widely practiced.
Laws are often formulated to benefit personally the individual
who administers the law. Friends are given important positions
in order to enrich themselves or to enhance their social prestige.
Generally speaking, the higher the political office the person
holds, the higher his social level.
No political officeholder in Latin America feels that he is
adequately paid, any more than does such a person in this
country. He cannot, he believes, support his family on his
government salary. But, he reasons, the government would not
want his family and himself to starve. In order not to starve
he must sell some commodity or form of service. Or, he may
attempt to increase his salary by various devices. For example,
an official may receive the equivalent of $300 a month from
his government office. He, however, needs $500 per month to
live. At the end of each month he therefore holds a lottery
among the five or six hundred employees of his department.
He will charge each worker possibly a dollar; each one has a
chance to win a check for $300 at the end of the month--and
the official will get the amount he needs!i In this way, by taking
advantage of the universal spirit of gambling, he can support
his family in the way he feels befits his political position.

~VI

Each constitution in Latin America provides for a supreme
court, copied largely from our Supreme Court. However, when
Franklin D. Roosevelt some years ago began to view with a
critical eye the "nine old men" on the United States Supreme
Court, the Latin American presidents began to raise questioning
eyebrows at their own supreme court members. Generally, the
members of the supreme courts in Latin America had been ap-

INTRODUCTION XIX

pointed, as in the United States, by the president, with the
approval of the senate. But some had grown old in service; some
had grown senile. Many were political opponents of the presi-
dent. Evidently a revision of the supreme court was necessary
in many of the Latin American countries. In some instances it
was decided that a man should retire when he reached a certain
age. Others were retired if they were found incompetent. Some
could still serve for a period of good behavior. In some countries
it was decided, however, to choose members of the supreme court
at the time the president was chosen. In this case the length of
the term coincided with that of the president.
Members of the supreme court are generally considered at the
highest social level in every Latin American country. Often,
because of their age and the nature of their tenure, they out-
rank the president in their social position. In some countries
indeed the supreme court members have been so preoccupied
with social affairs that they have seldom met to consider con-
stitutional matters. In one Caribbean country, for example, the
supreme court did not meet for a long period of time. This
caused a complaint on the part of the citizens for they wondered
what function the supreme court really served in their country.
When such public criticism was heard by the supreme court
members, they met and declared unconstitutional all laws passed
by the government for several previous years! This obviously
was absurd, and they were laughed off the political stage.

VII

In each country there has been at one time or another a
vice-president elected to serve usually for the same length of
time as the president. In most of the Latin American countries,
as in the United States for many years, the vice-president has
been a figurehead, simply waiting for the president to die so
that he might succeed him. In some Latin American countries
the vice-president has been considered potentially dangerous,
because, as some believe, he might attempt to have the president

The Caribbean

assassinated or overthrown so that he could succeed him. In
these countries it was decided that a vice-president was not
needed. In other countries, because the president's occupancy
of the office was frequently hazardous and dangerous, it was
considered necessary to have two vice-presidents. Thus, if a
president was removed, a vice-president could immediately suc-
ceed him and there still would be a spare vice-president to follow
in case of another crisis.
Presidents in Latin American countries have many of the
constitutional characteristics of presidents of the United States,
after whom they were originally patterned. There is a definite
age limit in each country. The legal term of office, however,
has varied in length from one year in some countries to six or
more years in others. Latin American presidents, like presidents
in the United States, come from various walks of life. Some are
professional men; some are professional politicians; some are
vegetarians or belong to weird religions, cults, or societies. Some
have been illiterate, humorless, witless, or uncouth. And presi-
dents may be of any color in Latin America.
Generally speaking, a Latin American president may assume
considerably more power than a president of the United States.
Except in times of war or great emergency, our president cannot
exercise dictatorial rights. In Latin American countries a presi-
dent may take the initiative in changing a constitution. He, in
fact, may even formulate a new constitution to substitute for an
old one. Each constitution gives the president the power to de-
clare, usually with permission of congress, a "state of siege."
Frequently this means that congress adjourns, the constitution
ceases to function, and the president legislates by decree. This
makes him a greater legal dictator than a president of the United
States could be. Many Latin American presidents use this loop-
hole as a means of establishing legal dictatorship, for a Latin
American president must be extremely strong-willed not to try
out this clause in the constitution. When a Latin American
president thinks he sees a threat to his government, he is quite
likely to issue the declaration of a "state of siege." Technically,

INTRODUCTION

a "state of siege" must have a definite time limit. In actual
practice, however, the "emergency" can be extended; sometimes
it may last for years.

How does a man in a Latin American country decide that
he wants to run for the presidency? Suppose Sefior X suddenly
becomes interested in politics. When he looks at the presidential
incumbent he feels that he himself is much better than the man
in the presidential palace. If he himself is better than the presi-
dent, certainly he ought to run for the presidency. The country
cannot afford a mediocre man in high office! When he talks to
his family and friends about the matter, they agree with him.
They feel that since he is a much better man than the president,
he should run for the presidency. In a short time, Sef~ior X has
a political following which is a personal following. Senior X
probably will not disclose his political ideas during the campaign
for fear of losing some of his support, though he will always say
that he stands for God, Country, and Home. Persons will follow
him largely because they like his looks, or they like his wife, or
they like the sound of his voice. Possibly he will make some radio
broadcasts, being always careful not to lay very many political
cards on the table, for he likes to keep his friends as well as
his enemies guessing as to his political ideas and ideals. Possibly,
of course, he has no political ideas formulated; he may rely
upon developing these as the campaign progresses.
All over the country, other like-minded individuals are prepar-
ing to run for the presidency. Each has his own personal follow-
ing of friends and relatives. This is personalismo in politics.
Among some of these men there are usually several military
leaders. It is obvious to all that only one person can be elected
chief executive. Generally, the man who has the support of the
outgoing president is the individual most likely to succeed to
the presidency. This fact, of course, is evident to the other
candidates who may, in consequence, form coalitions. The result

xxii

The Caribbean

is that many political factions develop and then group and
regroup.
The names of the political factions in Latin American coun-
tries differ, but there is a great deal of similarity nevertheless
among them. Some of the party names used in different coun-
tries are "liberals," "conservatives," "radicals," "republicans,"
"democrats," "socialists," "labor," "rightists," "leftists," "cen-
tralists," "white," "brown," "red," "green." There are even
" liber~al-con1servatives" and "conservative-liberals."' The use of
the term "communist party" has declined somewhat in recent
years because of the odium connected with it. Generally speak-
ing, when the word "communist" is now used in the political
sense in a Latin American country, it is employed as a deroga-
tory term. Sometimes a "communist party" is a nationalist
rather than a Russian-connected party. It usually advocates
some sort of socialistic doctrines or principles, such as "state
socialism." There are comparatively few international socialists
directly connected with the U.S.S.R. in Latin America today.
As the time for the election approaches, more of these indi-
vidual candidates and their factions will join cooperatively with
each other, stringing along the combined names of their party-
factions in a hyphenated fashion. When the day of election ar-
rives, a candidate's supporters generally go to the polls in an
exuberant mood, occasionally intoxicated, and often carrying
firearms. In previous decades elections frequently were revolu-
tions and numerous people were wounded or killed in political
arguments. Nowadays, the army generally maintains peace at
the polling places, and elections are more likely to be relatively
quiet affairs. The results of the election may or may not be
known immediately after the polls close. In some instances it
may be several months before a final vote is announced.
When the successful candidate is elected, he prepares an in-
augural address. At this time he usually reveals his platform,
which heretofore has probably been clouded by rhetoric. In
any case, he speaks again in glowing terms of God, Country,
and Home. He may also use the occasion to suggest that the

XX111

INTRODUCTION

existing constitution is outmoded and that a new and better one
is necessary.

IX

After the inauguration the president takes over the presi-
dential palace from his predecessor. Generally, his family and
relatives move in with him. Occasionally it even happens that
the new president thus discovers some relatives whom he did not
know he had! Everyone wishes to bask in his political and
social glory. The spoils system now begins to function in earnest.
The "ins" immediately get rid of the "outs." The "outs" may
start a revolution to get back in. Sometimes a new president
exiles his political enemies. Sometimes they go into hiding or
go underground. Occasionally, of course, the president attempts
to maintain internal political peace among all political factions.
One of the first official acts of a new president is to select
his cabinet. The cabinet is somewhat similar to ours, in that
it is made up of ministers or heads of various departments. The
minister of state or of foreign affairs is usually considered the
dean or chairman of the cabinet. Since the military members
often play an extremely important part in the cabinet, another
early step frequently taken by the president is the reorganization
of the military. He may put many of his friends into officers'
positions. Still another early activity of a president may be to
announce that he hopes to nationalize certain industries or to
expropriate certain industrial establishments. This may, how-
ever, be dangerous, and some presidents hesitate to take this
step at the beginning of their administrations. Many presidents
believe that one of their functions is to interest foreign bankers
and businessmen in investing in their particular country. To
help foreigners make such investments, the president considers
it legitimate to receive a fee from the company for doing this
good deed for his country. Such commissions are generally paid
willingly by foreign concerns, as they usually receive a con-
siderable privilege in freedom from taxes and other nuisances.

xxiv

The Caribbean

At one time or another each Latin American country has had
a dictator. Some have had many dictators. Some dictators have
been worse than others. Generally speaking, dictators are ego-
centric and extremely egotistical. They are convinced that they
have the good of their country at heart, but they feel that the
country belongs to them and whatever they do is logical and
right for the country. Frequently a dictator must use force to
remain in power. This in turn invites the use of force against
him. Thus, full-blown revolutions may develop. Political assas-
sination in Latin American countries has been a frequent and
at times a fashionable cure for dictatorship. Hence, many coun-
tries have had many presidents. Some have had as many as
three presidents simultaneously; many have had two.
Dictatorship in Latin America, considering the twenty coun-
tries as a whole, has followed a cyclical pattern. About every
seventeen or eighteen years there has been a peak, when more
dictators flourished than usual. This cycle has been quite regular
since the early part of the nineteenth century, when many of
the states started off with military presidents. Military men are
not necessarily greater dictators than nonmilitary. Generally
speaking, a dictator is an eminently practical man; he constructs
monuments and public buildings primarily that his name may
be placed upon them. He does good for his country by doing
the best he can for himself. He is a "do-it-now" man who
doesn't wait for tomorrow.
Not all the bad presidents of Latin American countries have
been dictators nor have all dictators been bad for their country.
Sometimes greater economic and social progress has been made
under a dictator than under a nondictator. Usually, however,
the nondictator president has been less picturesque and has not
attracted the respect or the awe which the dictatorial type
mnspires.
Latin American countries have had dictators largely as a

INTRODUCTION

XXV

political compromise between the democracy which they hoped
to establish in the early part of the nineteenth century and the
monarchy which they had had for several hundred years before
their independence. "One-manism" in Latin America is natural.
As one looks back over the historical panorama of several hun-
dred years of Latin American and Iberian history, one can see
only a one-man type of government. The Greeks and the Ro-
mans had a one-man government in Iberia. The Germanic
tribes, as invaders, brought in the one-man government idea of
the chieftain. The caliph came with the invasion of the Moors.
Ferdinand and Isabella, at the time of the Reconquest, estab-
lished an absolute monarchy. In America, the early Spanish
conquerors found the Indians under a one-man government.
Negroes from Africa were used to a one-man form of govern-
ment. The viceregal government set up in America by the
mother countries of Spain and Portugal continued the idea of
one-man government. Consequently, by the time the peoples of
Latin America were ready for independence, the only political
experience they had had was of one-man government. In break-
ing with tradition and establishing independence they copied the
democracy of their great neighbor to the north, the newly created
United States. This was a complete political about-face, ex-
tremely illogical from the standpoint of practical politics. After
a trial of democracy, the political pendulum swung back in
many countries to a form of dictatorship, sometimes mild, some-
times not so mild. This was a compromise between the old one-
man form of government and the new democratic ideal.
Thus, political patterns for generations have followed certain
trends in time and space in the Caribbean area as well as else-
where in Latin America. Consequently, no one in the United
States today should become disturbed by revolutions or dictators
in the nations south of us. The people of these countries are
simply engaged in practical politics. They think that our politi-
cal methods are peculiar, just as we often think that their
methods are impracticable. But they have developed workable

xxvi The Caribbean

governments as they developed their political habits. It is not
for us to be alarmed or to become excited by their political
practices. Their governments function as they want them to.
They are satisfied with them. Who are we to criticize?

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

Part I

ECONOMIC TRENDS

1L

E. A. Norton: CONSERVATION PROBLEMS
IN THE CARIBBEAN AREA

7THE SOIL AND WATEIR conservation problems of the
Caribbean area are not small and insignificant, as might be
concluded from a casual study of the map of the Western Hemi-
sphere. The islands alone comprise between 60 and 70 million
acres. This is no small amount of land in any part of the world
in this twentieth century. Nearly 10 million acres lie at an
elevation of more than 1,500 feet above sea level. The soil
capable of producing food crops means life to something like
50 million people who occupy the many islands and closely re-
lated continental countries. In addition, this region is looked
to for annual supplies of such essential commodities as sugar
by many millions more.
In some parts of the Caribbean area, population already
outstrips needed acreage of .productive land. At the same time,
the need for improvement and protection of the soil, and for
better methods of using the water available for agriculture, is
urgent. In Puerto Rico, for example, with a total area of about
2 million acres, there are as many people as there are acres of
land, and the population is increasing rapidly. Soil is intensively
used, and three-fourths of the arable acreage requires complex
soil conservation practices. There are many other such examples
of mountainous, tropical lands where the people live more from

The Caribbean

the products of their own soil than from any other source. In
many parts there is not enough good land to support the popu-
lation and allow any improvement in living standards now or in
the future.
In such a situation the population, in its struggle for existence,
will try to exhaust all natural resources. The pressure of popula-
tion in the Caribbean area is already forcing cultivation of even
the steepest slopes, of areas exposed to waterlogging, and of
other marginal lands subject to rapid erosion and fertility decline.
I think we may safely conclude at the start that in the Carib-
bean area, more than in most parts of the Western Hemisphere,
each acre of land counts tremendously. It is essential that we
learn how to obtain the highest yields from each acre without
destroying the soil's productive capability. Improved use of the
resources of all parts of the region must come in the very near
future if disaster is to be avoided.
In fact, there are no more large land frontiers left in our
hemisphere to take care of surplus populations such as are
rapidly building up in the Caribbean area as well as in other
parts of the hemisphere. That is, there are no more large areas
of undeveloped, highly productive land. Locally there are areas,
such as in the Surinam, which when cleared, drained, or irri-
gated will produce abundantly; but such areas can be brought
into cultivation only over a long period of time and at great cost.
Generally speaking, we have reached the period of hemispheric
development when we must depend upon increased per-acre
yields from the land now in cultivation for most of our increased
production in the future. This is especially true in the Caribbean
area, where population already runs as high as one hundred to
six hundred inhabitants per square mile. The problem of land
scarcity, together with increasing population, makes it doubly
important that all the good cultivable land be conserved, pro-
tected, and improved and that there be no further delay in
getting on with this job.

ECONOMIC TRENDS

It is true that industry is on the increase in a few places in
the Caribbean area and that, gradually, more people will be
absorbed into towns and factories. At the same time and be-
cause of this, the problem of water is becoming acute, while the
pressure on the land is not decreasing. As industry expands,
there is more demand for farm products as well as for water.
For successful industry there must be adequate water not only
for factories, but for household use and for growing raw ma-
terials for factories and food for the people. Food and water
are so closely interrelated that it is impossible to separate them
into two problems.
Water must originate as rain and it must be held on or within
the soil. The supply is relatively fixed, and already in many
areas it is not enough for expansion of either agriculture or
industry, let alone both. In some parts of the Caribbean area,
huge dams, tunnels, and reservoirs are being employed for better
control and use of the available supply. But it is estimated that
the useful life of many of these structures is foreshortened
because of silting. Replacement will be difficult, since effective
sites are limited, especially in island countries.
Altogether, the outlook for water is serious, if not critical, in
several parts of the area. Nor is the outlook for productive soil
one for careless optimism. Neither case is hopeless, but un-
doubtedly soil and water present two of the most basic problems
which the region has to face. In view of the rapidly growing
populations there is no time to lose.

III

Like all natural resources, soils vary considerably in the quality
of their productiveness. Although all but a small percentage of
the agricultural products that reach the market come from areas
where the soils are highly productive, consideration must be
given to conservation of the areas whose soils are not so produc-

The Caribbean

tive. These poorer soils must be built up in fertility and stability
not only for the sake of the farmers who are dependent upon
them for a livelihood, but in the interests of total production for
the markets. Many of the most complex and difficult problems
in soil conservation are encountered in those areas that are near
the margin for agricultural production. Also, in the develop-
ment of new lands for agricultural production every precaution
must be taken to assure a profitable and permanent enterprise
before the project is begun.
The conservation problems of the Caribbean area, as of other
regions of the Americas, can be grouped under two broad heads:
the physical loss of topsoil by erosion; and the loss of soil fer-
tility. Gullying and sheet erosion of crops and pasture land in
humid and semiarid areas has carried away great quantities of
the original topsoil. Wind erosion in scarce-rainfall belts has
removed all topsoil in many places. Wherever land has been
used to grow food or fiber crops, there has been a depletion of
fertility, although the loss varies according to the cropping
system and other factors, such as climate and the physical
properties of the soil. Leaching and removal of plant food by
continuous cropping are the two principal causes of loss of soil
fertility. Generally speaking, erosion and loss of fertility are the
most damaging diseases of the land which are keeping down
agricultural production throughout the Americas.
The destruction of the natural vegetation by clearing, plow-
ing, and overgrazing for more than a century, along with re-
moving crop after crop without replacing the plant food, are
the main practices that have caused the serious soil and water
conservation problems. Nearly all the land of the Caribbean
area was once heavily forested. The reduction of the organic
matter content of the soil and the subsequent breakdown of
soil structure set the stage for erosion. Once erosion gets started,
it spreads rapidly and causes great damage.
The erosion survey of Puerto Rico, made by the Soil Conserva-
tion Service of the United States Department of Agriculture,
revealed that erosion hazards in the island are alarming. The

ECONOMIC TRENDS

total land area was grouped into the various degrees of erosion
according to their economic importance in the agriculture of
Puerto Rico. The first group includes an area of approximately
691,000 acres--or 31 per cent of the total--where erosion
progresses slowly. The second group includes areas where ero-
sion is moderate, and comprises 589,000 acres, or 27 per cent
of the total land. The third group, which includes the most
severe and urgent problem of soil erosion, consists of 917,700
acres, or about 42 per cent of the total area of the island. It
may be readily concluded that the land resources of this part
of the Caribbean area have been so seriously undermined that
they constitute a menace to the security of the population itself.

IV

The extent of this deterioration is due to a series of factors
most of which are now known to be under the complete or
partial control of human beings. Soil deterioration is closely
related to the amount and intensity of rainfall, to topography,
nature of soils, cropping systems, population pressure, land ten-
ure, size of land holdings, farm credit, and, most important of
all, to a lack of knowledge and of economic resources on the
part of farmers. Farmers do not realize what is happening to
their land. The apathy on the part of the public in general and
of agricultural specialists who failed to recognize the need to
conserve the soil may also have contributed in no small degree
to soil losses in the tropical Caribbean area.
The Department of Agriculture of the United States has taken
a long step forward in conservation of soil and water resources
by adopting the principle of "use of each acre within its capa-
bilities and treatment of each acre according to its needs for
protection and improvement." Dr. Robert M. Salter, Chief of
the Soil Conservation Service, recently defined soil conservation
as "proper land use, protecting the land against all forms of
soil deterioration, rebuilding eroded and depleted soils, con-
serving moisture for crop use, proper agricultural drainage and

The Caribbean

irrigation where needed, and increasing yields and farm in-
come--all at the same time." Dr. Salter further stated: "It
follows, I believe, that a soil conservationist is one who assists
owners and operators of land to skillfully select and apply the
appropriate combination of economically feasible measures,
fitted to the soil of specific fields, to protect, improve, and
maintain the productivity of the specific land involved. He
synthesizes soil, water, and plant technology into a workable
system which fits the specific pattern of soil and water resources
on a farm."
A considerable amount of success has already been attained
in the United States soil and water conservation program.
Latest detailed reports revealed that approximately 1,120,000
farmers and ranchers operating 322,400,000 acres in soil con-
servation districts are active participants in this program to
improve and conserve the agricultural land of the nation. The
program, of course, extends to Puerto Rico and the Virgin
islands, where more than 8,000 farmers operating more than
half a million acres are cooperating in it. These Caribbean
farmers have adopted contour farming on nearly 62,000 acres,
stubble mulching on 163,000 acres, pasture improvement on
114,000 acres, and conservation woodland management on
45,000 acres. They have planted trees on 10,236 acres of
severely eroded land. They have constructed more than 7,200
miles of terraces on their farms and have drained nearly 16,000
acres of land that were formerly too wet for economic crop
production. In addition, they have installed irrigation on 7,500
acres of dry land and built 126 farm ponds for water storage
For livestock and farm homestead supply.
Through development of soil and water conservation meas-
ures for Puerto Rico, it has been hoped by all who have
worked on this important project that other parts of the Carib-
bean area, and even other tropical areas of the world, might
benefit from the results. More than ten years of research and
study on the land of Puerto Rico have shown that the land-
use problem is difficult because of overpopulation, and that it

ECONOMIC TRENDS

is complex because of physical factors. The basic soil variations
are great, and they reflect the wide variations in climate, parent
material, topography, and other soil forming factors. In addi-
tion, there are the marks of land use and abuse, which in many
places have altered soil depth, physical condition, and fertility
of many soils to a degree that has largely obliterated the origi-
nal variations under virgin conditions.

This situation demands more research and study than would
be needed if the physical factors were reasonably uniform. It
places a premium on the fundamental understanding and evalua-
tion of the problems of the land itself and of the social and other
processes which will permit establishment of conservation land-
use principles. It can be said, however, that whenever we do
achieve a fundamental understanding the benefit will be great
in a relatively short time, not only for the variable conditions
in Puerto Rico but for vast related acreages of other tropical
land. I believe this is true especially for the Caribbean area.
A bulletin giving the findings and results of investigations in
soil and water conservation in Puerto Rico over the past ten
years is now being published by the United States Department
of Agriculture. It should be useful in many other parts of the
Caribbean area.
Especially interesting and valuable in these investigations in
Puerto Rico are the studies of problem areas and seasonal
climatic conditions, ground cover in coffee culture, the use of
terraces on deep and on shallow upland clay soil, mulching of
cane soils, soil-conserving tropical legumes and grasses which
have proved successful, and a suggested practical erosion-control
rating by crops and crop sequences for use in obtaining a clearer
picture of the effectiveness of improved land use and conserva-
tion practices.
Benefits of importance to the agriculture of Puerto Rico are
becoming apparent. At Orocovis, for example. pastures com-

The Caribbean

posed of a mixture of tropical kudzu and native grasses, on
shallow, severely eroded soil on 50 per cent slopes, provided
a substantial income while conserving and building up the soil.
Native scrub cattle produced almost five hundred pounds of
beef yearly on such pastures. Erosion has been completely
stopped, and the organic matter and nitrogen content of the
soil are being rapidly built up. These pastures are very easy to
establish and the forage will "keep" on the ground over long
periods. On properly managed pastures, mowing and weeding
were found to be unnecessary.
Another example may be found in the tobacco area of the
island. At Utuado a tropical kudzu mulch supplied all the nitro-
gen needed to produce an excellent crop of tobacco while re-
ducing soil erosion losses to about one-fourth of those from bare
soil. Tobacco represents practically the only source of cash in-
come for farmers in the east-central mountain region, where it
is cultivated, mostly on small farms, by about twenty-two thou-
sand growers.
In some other parts of the Caribbean area agricultural re-
search has developed the most needed practices and measures
which, when applied to the land, will prevent most erosion
damage. This work has been going on for some years in Mexico,
in the coffee areas of Colombia, in Venezuela, and in some of the
Central American countries. Already some considerable success
has been achieved at the new Agricultural Research Center for
French Caribbean Departments in Guadeloupe, especially in
the testing of tropical legumes and grasses suitable for establish-
ment of high-producing, soil-building pastures. All this work
should be reviewed in detail from the point of view of the whole
Caribbean area, to permit probable savings in time, effort, and
costs, and to allow for getting proved practices on the land as
quickly as possible.

'VI

I think it is already widely recognized that the application of

ECONOMIC TRENDS

soil and water conservation measures and practices to the land
is a most complex procedure and requires expert technical guid-
ance. The treatment of each acre according to its needs for
protection and improvement requires first that the character of
the acre be known. The soil must be identified as to type; and
it must also be determined how the soil will drain both externally
and internally, what quantity of the elements of plant food it
needs, the depth of the topsoil, and the susceptibility to erosion,
to name only a few considerations. Knowing these, it is possible
to recommend the kind of practices and measures which should
be applied to the land when it is used for a definite purpose.
The recommendations are so correlated that a minimum of
engineering practices need be applied when a maximum of
vegetative cover is used.
Good soil management is essential to efficient production. It
is as much a part of soil conservation as any other feature.
Nearly everywhere man has been selfish in using the land, or
at least he has not been aware that soils wear out so quickly.
Good soil management requires that the soil structure be main-
tained. If this is done continuously, erosion will be slowed down
and the moisture-holding capacity of the land will be increased.
A cropping plan that provides a supply of fresh organic matter
along with frequent additions of plant food must be adopted.
Land owners and operators will use the land properly when
they become "conservation conscious." They should be shown
at the outset that proper use and management of land will not
only conserve it but make it produce profitably, that conserva-
tion is a way of farming for efficient, abundant production on
a sustained basis. Soil and water conservation demonstrations,
located where farmers can see and study them, are of utmost
importance in encouraging farmers to understand their own
conservation problems and in getting them to accept a responsi-
bility to conserve their land and water resources.
However, just telling a farmer that he has an erosion problem,
and showing him how the job of conserving land is done in some
places, will not get the job done. The widespread application

The Caribbean

of sound farm conservation plans requires technical assistance.
Such assistance should provide an inventory of the soil resources,
point out the alternate uses and treatments of the land as shown
on the soil inventory (a blueprint of how the treatments fit in
various fields), and explain how the plan operates. Then, since
many of the practices are new to most farmers, technical help is
needed in getting the practices on the land and maintaining
them in good condition.

VII
Farmers need an organization through which they can make
their soil conservation wants known and by which they can ob-
tain the technical and other assistance they need. The outstand-
ing organization for soil and water conservation that has been
developed is the soil conservation district. It is a local unit of
government organized under law but in the complete control
of the farmers themselves. The growth of this movement in the
United States has been phenomenal. Nearly one-fourth of all
the land in farms in the United States has been completely
treated with conservation practices in fifteen years of district
operations. Similar organizations in other countries are spring-
ing up and show great promise. A~ll the land of Puerto Rico
and the Virgin Islands is in soil conservation districts organized
by the farmers since 194~6, when the Puerto Rico legislature
passed a Soil Conservation Districts Law authorizing farmers
to form the districts under guidance of the Insular Soil Con-
servation Committee which was also created by the act.
Each district has a governing board known as the Board of
Supervisors. Three members are elected by the farmers, and
two are appointed by the Insular Committee. All members
must live within the district governed by the board of which
they are members. In carrying out the work of soil conservation
within a district the farmer-controlled board of supervisors may
call upon local, insular, and federal agencies for such assistance--
technical or otherwise--as the agency may be in a position to
provide for individual farmers.

ECONOMIC TRENDS

Soil conservation districts provide a means for mutual action
toward common objectives. They provide a means for farmers
to learn the facts about land and agriculture in their district.
The supervisors represent the farmers of the various municipali-
ties, thereby bringing together the best thinking in each com-
munity for the betterment of all the districts. Through its soil
conservation districts, the soil conservation movement in Puerto
Rico is now developing a coordinated approach, and the local
people have available much needed assistance for the use and
maintenance of productive land.

VIII

The demand for agricultural products throughout our hemi-
sphere in the next quarter of a century can and will likely be-
come 50 per cent greater than it is today. If we are to meet
this demand for food and fiber, we must depend largely on
increased per-acre yields. Certainly this is true of the greater
part of the Caribbean area. Increased per-acre yields call for
the rapid application of soil and water conservation, good soil
management, and the use of all known technological improve-
ments in agriculture. This means that in all regions and coun-
tries we must see to it that soil and water conservation programs
are organized and speeded up at once if we are to avoid rapid
decline in both our economic and social life.
In most parts of the hemisphere, including the Caribbean
area, we can expect the land to continue to produce adequately
if we learn to treat it the conservation way and improve it as
we use it. By using soil and water conservation, it will be possible
to increase production from 50 to 75 per cent, if we do not
delay too long the job of conditioning all the land for safe and
permanent use. I believe that if the present interest in soil con-
servation persists through the next two or three decades, our
soil resources can be conserved and their use changed from a
more or less wasteful agricultural economy to one that will be
not only profitable but permanent as well. Then it will be

14 The Caribbean

possible to produce the food and fiber necessary to care for the
growing population, to supply its industry with needed raw ma-
terials and, at the same time, to make permanent improvements
in the way of rural living. The important thing just now,
especially in the Caribbean area, is to get soil conservation pro-
grams organized and working for the benefit of the land and
the people.

2

Miron Burgin: SOME PROBLEMS OF ECONOMIC
DEVELOPMENT IN THE CARIBBEAN AREA

THROUGHOUT Latin America the term "economic de-
velopment" has in recent years become almost a household
phrase. Its popularity and to some extent its significance stem
in part at least from the conviction shared by many in Latin
America that economic development provides a unique and
effective solution of the problem of social-economic progress.
The term is, of course, not new, nor indeed is the process which
it describes. What is new in the current usage of the term is
the emphasis upon coordination of economic activities designed
to bring about the fullest possible utilization of material and
human resources. It is a coordination, moreover, which is to
be oriented toward goals couched in national rather than in
entrepreneurial terms.
The scope of economic development, its direction and em-
phasis, must of necessity vary from country to country. By defi-
nition, the term encompasses all sectors of the economy. But
it is recognized that economic development is a function of
geographic environment, of existing economic institutions, and
of the social-cultural pattern of life in the area. So, in one
country economic development may well manifest itself in strong
emphasis upon industrialization, while elsewhere the principal
developmental activities may be directed to some other sector

The Caribbean

of the economy. Again, the scope of economic development
changes in time, for it is conditioned partly by the accidental
character of past economic growth, and partly also by variations
in the developmental potential among the individual sectors of
the economy. This generalization is especially valid with respect
to Latin America, where national economic structures have al-
ready attained a considerable degree of complexity and where
future economic development cannot readily disregard, save
at a considerable cost, institutions that are deeply imbedded in
and form an integral part of the contemporary pattern of eco-
nomic and social life. It at the same time permits an appropriate
phasing of economic development in accordance with the area's
human and material resources, its short-run requirements and
long-range possibilities.
Planning or allocation of resources in time as well as in space
would appear to be an essential element of economic develop-
ment. It relates to the availability of resources, to the manner
and order in which they are to be utilized, and, indeed, to the
very process of economic growth. It stems from the circum-
stances that resources are not unlimited and that some combina-
tions of these resources are more productive than others. Within
any given area the volume of natural resources is relatively stable
and limited, although the economic use of these resources is
subject to change in response to changes in industrial technology.
It is obvious that knowledge of the economic potential of these
resources is a prerequisite of effective planning for economic
development, since only under this condition can competition
for available labor and capital be given full play.

Also limited, though in a somewhat different way, is the sup-
ply of labor and capital. Under conditions of reasonably full
employment economic development would by definition require
a transfer of labor from one area of economic activity to another.
Such shifts need not, however, be costly. Indeed, in countries

ECONOMIC TRENDS

where there exists disguised unemployment a shift of labor oc-
casioned by the opening up of new areas of economic activity
may well result in a net increase in productivity and quite pos-
sibly in total production in the areas from which labor was
drawn.
According to a definition formulated by a group of economists
in the United Nations, disguised unemployment or underem-
ployment relates to individuals "who work for their own account
and are so numerous in relation to the resources with which they
work, that if a number of them left their occupations to work
in other economic activities, total production of the sector in
which they were formerly engaged would not be diminished,
even though no important reorganization or any appreciable
substitution of investment were effected therein." In a number
of areas in the Caribbean region the volume of disguised unem-
ployment is considerable. This unemployment may be due partly
to overpopulation, partly to the circumstance that economic
opportunities are in general rather limited, and partly also to
traditional and institutional factors which inhibit mobility of the
population. The problem is not so much one of choosing be-
tween two profitable methods of utilizing labor, but rather one
of creating forms of economic development capable of absorbing
labor whose present productivity is extremely marginal. It is
particularly serious in countries where the rate of population
growth is rather high, as is the case for example in El Salvador,
Costa Rica, Guatemala, Nicaragua, and Honduras. In such
areas the rate of economic development must exceed the rate
of population growth, if disguised unemployment is to be elimi-
nated or substantially reduced.
One additional point may well be considered in connection
with the problem of supply of labor. In certain areas and at
certain stages of economic development technical skill is indis-
pensable. Indeed, shortage of skilled labor may well become
the crucial limiting factor of all economic development. For
this reason the opening up of new areas of economic activity
capable of absorbing surplus labor must be accompanied, and

The Caribbean

at times preceded, by efforts to increase the supply of skilled and
semiskilled labor. This is not always an easy task, especially in
countries where training facilities are nonexistent or cannot be
easily maintained in view of the narrowness of the demand for
specific skills. The problem will be less urgent and more easy
to solve in the industrially more advanced countries, such as
Mexico, and it will be more complex in countries where the
industrial sector is small and in its early stages of development,
and where also the technological level of agricultural activities
still leaves a good deal to be desired. In the latter case interna-
tional cooperation such as is exemplified by the Agricultural
Institute at Turrialba, Costa Rica, offers an effective solution.

III

The problem of utilization of capital resources is considerably
more complex than that of labor or national resources. In present
circumstances capital is the limiting factor in the economic de-
velopment of the Caribbean area. The limitation relates not
only to present availabilities of investment capital, but also and
perhaps more significantly to the capacity of most of the Carib-
bean economies to channel an adequate proportion of current
production into investment.
Certain aspects of the problem merit special consideration in
the context of this paper. As capital is scarce in relation to de-
velopmental needs and opportunities, its allocation among claim-
ant activities becomes a task of not inconsiderable complexity.
In a competitive market such allocation can, of course, be left
entirely to the play of economic forces. This course, however,
sound though it may be, may not always be practicable. It is
certainly not practicable in those sectors of the economy where
government and public capital have found it necessary or advis-
able to play an increasingly important and at times a decisive
role. At any rate, the direction of the flow of investment capital
can be and often is to a considerable extent determined either
directly or indirectly by public authorities.

ECONOMIC TRENDS

Whatever the mechanism by which investment capital is allo-
cated among the competing claims, the problem of formulating
criteria for such an allocation can hardly be avoided. If em-
phasis were to be placed upon the production of goods for in-
ternal consumption, the pattern of capital investment would
differ markedly from that which would correspond to a decision
to promote the growth of production for export. Again, long-
range development presents a pattern of demand for capital that
differs significantly from a demand that would be brought forth
by economic development designed to meet current consumption
needs of the population. To be sure, these considerations need
not be mutually exclusive; indeed, they may well be comple-
mentary. Expansion of production of consumers' goods may well
depend upon the existence of an appropriate economic environ-
ment, the creation of which requires more or less substantial
long-term investments. Or, to call attention to another aspect
of the problem, expansion of exports may be necessary in order
that the domestic sector of the economy can be provided with
the capital goods that must be procured from abroad. Such a
complement does not, however, eliminate the problem. On the
contrary, it makes the problem more complex.
Precisely because investment capital is scarce in relation to
other resources as well as to developmental requirements, eco-
nomic development must encompass areas where returns are
direct and immediate, as well as those where returns either are
indirect or can be realized only after a lapse of time. The con-
struction of a hydroelectric plant with a productive capacity
that anticipates future demand, and indeed stimulates such a
demand, involves at least temporary immobilization of some
capital resources. Expansion of the educational system, whether
for the purpose of reducing illiteracy or for the purpose of in-
creasing the supply of skilled labor and technicians, calls for
capital expenditures from which no direct returns can or need
be expected. It is in this context that the problem of balancing
developmental opportunities and requirements must be placed,
in the forefront of economic policy in underdeveloped areas.

The Caribbean

The question of effective utilization of natural and capital
resources and, therefore, of the cost of economic development,
is closely related to the existence or creation of national markets.
It is generally agreed among observers of the Latin American
economic scene that narrowness of national markets in Latin
America has in the past been a serious obstacle to the growth
and development of industrial enterprises capable of surviving
foreign competition. The narrowness of the national market
relates less to the size of the country's population than to its
income. In many of the countries in the Caribbean region only
a relatively small proportion of the population can boast an
effective market large enough to support industries in which
costs of production are closely related to volume of output. A
manufacturing plant whose productive capacity must of neces-
sity be considerably in excess of domestic demand for some
time to come, and whose actual output as determined by the
market must support an inordinately large overhead cost, is a
melancholy sight--a sight that is altogether too common on the
Latin American economic landscape. At best, it involves the
freezing for an indefinite period of scarce resources, especially
capital. At worst, it involves misuse or even waste of capital
resources and, under conditions of reasonably full employment,
of labor resources as well.
The problem of markets in underdeveloped countries is in a
very real sense closely related to levels of living. In general,
present levels of living are so low that even a relatively modest
improvement is likely to expand the domestic market rather con-
siderably, since such an improvement would be translated almost
entirely into a demand for necessities. But improvement in levels
of living cannot be attained except through increased productivity
or through reduction in the cost of the commodities which the
bulk of the population consumes or is likely to consume.
The problem of national markets will be less difficult to solve
in countries with relatively large populations. In Mexico, for

ECONOMIC TRENDS

example, the potential market appears to be sufficiently broad
to permit the establishment of mass-production manufacturing
plants of optimum size. Even in Colombia, Venezuela, and
Cuba one can look forward to the eventual development of
domestic markets for a number of consumer goods that would
justify fairly heavy industrial investments. In Central America,
on the other hand, the limits to the expansion of domestic mar-
kets are relatively low. In El Salvador, for example, with a
population of over 2 million, only about 150 thousand family
units out of a total of 450 thousand earn more than $36 per
month. Even a sizable improvement in family incomes would
not create an adequate national market for many mass-produced
commodities. These considerations have even greater validity
for countries such as Costa Rica, with a population of less than
1 million, or Honduras, with a population of a little over 1.5
million.
The vicious circle of mutual dependence between economic
development and growth of national markets can be at least
partly broken with the resources at the disposal of these countries.
One point of attack upon the problem would appear to be re-
duction in costs of production and distribution of the commodi-
ties offered for domestic consumption. Such a reduction can be
secured through improvement in the economic environment in
which production and distribution take place. Among the most
significant components of such an economic environment would
be adequate transportation, and abundance of power at reason-
able prices.

The need for improvement of transportation facilities, espe-
cially highways, has been recognized for some time now through-
out the Caribbean region. In the last decade or so considerable
progress has been made with assistance from the United States
in the construction of the Pan-American Highway, which
when completed will link the countries of Central America and

The Caribbean

Mexico. But of importance equal with that of the great trunk
highway are feeder highways reaching into the interior of the
countries. For it is there, outside the capital cities and other large
industrial centers, that the market potential is greatest and most
capable of rapid growth, at least in the early stages of expansion.
It is not possible or even appropriate in this paper to indicate
what should be the transportation network for each country.
It would require much more direct and intimate acquaintance
with the economy of El Salvador than I can claim, to say
whether the country's network of over 3,000 kilometers of high-
ways and earth roads is adequate or not. Certainly the system
of roads in El Salvador is at present considerably superior to that
of ten or fifteen years ago, and similar improvements may be
noted in Mexico, Guatemala, Honduras, Nicaragua, and Co-
lombia. However, the principal criterion of the adequacy of the
transportation system is not so much the density of highways or
road mileage, but rather the capacity of the network to integrate
all the potentially important areas of economic activity into the
national market.
To the extent that improvement in the transportation system
reduces the cost of distribution and, therefore, the ultimate
price of the commodity to the consumer, it increases the purchas-
ing power of the population. This in turn broadens the market
base for industrial expansion and permits establishment of manu-
facturing plants in which the scale of production is in closer
accord with norms prevalent in competing plants abroad. The
ultimate purpose of capital investment in transportation con-
sists, therefore, not only in the reduction of distribution costs,
but in a decline of production costs as well.

VI

The question of supply of power lies close to the center of
economic development policy and planning. The present supply
of electric power in the various countries of the area is admit-
tedly insufficient to support the kind of economic development

ECONOMIC TRENDS

which the available natural and material resources permit.
Moreover, the cost of electric power is frequently rather high.
Exploration of new sources of power and their exploitation in-
volves both long-range planning and long-term investment of
considerable size. Here, too, expansion of power production
facilities calls for investment of resources that not only meets
current demand but that anticipates future needs. At the same
time the cost of electric power to consumers, especially industrial
consumers, must be sufficiently low to permit intensive mechani-
zation of production of manufactured goods. In this respect
most of the countries of the Caribbean region have yet a long
way to travel, in spite of truly remarkable advances in the post-
World War II period. The experience of certain Central Ameri-
can countries is rather instructive. Expansion plans, involving
principally completion of projects of the Lempa Electrification
Commission in El Salvador and of the National Institute of
Electricity in Costa Rica, envisage an increase by 1954 in the
total capacity of these two countries of about 40,000 kilowatts.
Work under way in Nicaragua and Guatemala will add 14,500
kilowatts by 1955. These increases, however, will be just about
sufficient to meet the demand projected for these countries by
1955, and there will be left little or nothing of unused capacity
to meet requirements of continuing economic development. It
seems clear that in these countries plans must be formulated in
the very near future for further expansion of production of
electric energy.
It will be noted that development of both electric power and
transportation facilities calls for long-term capital investments
of considerable size. Moreover, this investment must not only
respond to current requirements but must also anticipate future
needs. Part of the capital allocated to construction of highways
and electric power facilities cannot be expected to yield returns
in terms of improved levels of living until some time in the
future. Indeed, capital used for highway construction cannot
be amortized except indirectly, through expansion of economic
activities and integration of the national economy. In either

The Caribbean

case there arises the issue of determining the proportions of avail-
able capital resources which within a given period should be
allocated for these long-term investments without denying to
other sectors of the economy their share of these resources.

VII

Another area in which considerable progress can be made
toward the goal of increasing the absorptive capacity of the
domestic market is improvement of productivity in agricultural
industries. Inculcation of more productive methods of cultiva-
tion, utilization of more effective equipment and implements,
installation of storage facilities, and adoption of appropriate
marketing methods--all such measures can be counted upon to
bring about an improvement in levels of living within a relatively
short time. Moreover, in view of the fact that a very large
proportion of the population in the Caribbean area derives its
livelihood from agriculture, the benefits derived from improved
productivity in agriculture are likely to be widely distributed
and within a relatively short period.
In the early stages of economic development concentration
upon agriculture as one of the crucial areas, of at least equal
importance with manufacturing, appears to be justified on several
grounds. To begin with, capital resources required to bring
about an increase in productivity need not be large in relation to
returns. Then, too, the investment unit is relatively small, and
a fairly large proportion of such investments can be amortized
within a relatively short period. Secondly, expanded agricultural
production can most readily make full use of investment in the
improvement of economic environment, such as transportation.
This would hold true of agricultural production destined for
either domestic consumption or the foreign market. And to the
extent that this does hold true the period of amortization of long-
term public investments is shortened. Thirdly, because of the
breadth of the agricultural sector in the Caribbean economies,
savings effected in agriculture through increased productivity

ECONOMIC TRENDS

are likely to be distributed rather easily throughout the non-
agricultural population. Here, too, reduction in the cost of
agricultural commodities can most readily be translated into
higher levels of living for the urban population, which is in turn
the more immediate market for manufactured goods. Finally,
increase in productivity in the agricultural export industries
would contribute markedly toward the solution of the problem
of capital accumulation as well as the problem of financing
purchase of capital goods that must be imported from abroad.
The latter consideration is of particular importance, since most
of the machinery and equipment needed for the development of
manufacturing industries cannot as a rule be produced locally,
but must be paid for with foreign exchange, and since also in
most countries of the Caribbean region agricultural commodities
form the bulk of exports. In recent years this problem may not
have been a pressing one in view of the rise in prices of coffee
and other export commodities. But even if present terms of trade
remain unchanged, additional supplies of foreign exchange de-
rived from increased productivity would broaden the horizons
and accelerate the tempo of economic development.

~VIII

Some broad conclusions may now be in order. It may per-
haps be considered a commonplace to say that all economic de-
velopment is uneven. But the statement that unevenness is an
essential and, indeed, indispensable element even of planned
development will bear repetition. The problem in planning eco-
nomic development is not, therefore, to eliminate unevenness
and to insure simultaneous and uniform rate of growth in all
the sectors of the national economy. It is rather a problem of
planning or controlling the degree of unevenness. Such plan-
ning must be designed to insure a selection of developmental
goals that will within a given period maximize production for
immediate use.
In most underdeveloped countries the limiting factor in eco-

The Caribbean

nomic development is scarcity of investment capital. It is with
respect to this factor that planned unevenness appears to be of
the greatest moment. Long-term investment must not be too
large in relation to the current productive capacity of the econ-
omy, or the investment will result in waste through immobiliza-
tion of capital. On the other hand, long-term investment in a
given sector of the economy must be sufficiently large to provide
a proper stimulus for economic activities in other sectors.
Since capital is scarce and since also a part of available capital
resources must remain permanently immobilized as long-term
anticipatory investment, economic development policy must put
special emphasis upon expansion of activities which promise
immediate returns to the economy. In many countries agricul-
ture would appear to offer such opportunities; but it is not at
all difficult to visualize industrial activities in which relatively
small investments, whether in the form of modern machinery
and equipment or in the form of new techniques, would result
in more than proportionate increments to national income.
Theoretically at least, for each economy a specific pattern of
investment can be devised which would insure a balance between
long-range and short-term investment and which would thereby
be likely to maximize production for a given period. To identify
the various elements that enter this balance is the task of the
scholar. To construct this balance in relation to a given eco-
nomic environment is a responsibility which falls upon the
shoulders of the policy maker.
The economic validity of the balance between long- and
short-term investments is itself subject to revision in response to
changes within the economy and abroad. This means that plan-
ning of economic development must be subject to continuous
re-examination, and that the planning period must be short and
the scope of developmental plans relatively narrow.

Gilberto Loyo and Ratil Ortiz Mena: PROBLEMS
OF UNDERDEVELOPED AREAS IN THE CARIBBEAN

THE OBJECTIVE toward which the economic policy of the
so-called underdeveloped countries seems to be directed is that
of economic development. But before attempting any considera-
tion of the very interesting subjects related to economic develop-
ment, we might well try to explain what is the meaning of this
term so widely used nowadays.

Economic development does not constitute a goal in itself.
That is, countries are not trying to advance their economy only
for the purpose of having a greater number of industries, better
communication and transportation systems, and so forth, but
for the sake of the achievement of certain particular aims. In
objectives in all aspects of national life, among which can be
this sense, economic development is a way to attain fundamental
pointed out such achievements as a rising standard of living
for the population, economic independence (or at least diminish-
ing dependence on foreign areas), and the adequate use of all
national resources in the national interest. Therefore, if the
above aims constitute the purpose of economic development, it
should only be evaluated, according to our way of thinking, by
the magnitude of the special results obtained.

The Caribbean

An attempted definition of economic development, embody-
ing the aims as well as the means to accomplish them, is as
follows: National economic development is the sustained and
persistent process of investments--not necessarily in continuous
growth--which, allowing wide and intensive application of
modern technology to the production of goods and services of a
country and increasing the capital endowment per employable
worker, will make the country's productivity rise and conse-
quently increase the income, consumption, and savings of the
majority of the population, and which at the same time will
maintain the flow of capital essential to the economic develop-
ment itself.
It is easy to deduce from the above definition that economic
development can be considered a function of capital accumula-
tion, since the most important way to accomplish it is through the
increment of capital per person. In other words, the accumu-
lation of capital as the essential characteristic of the system is
the road to economic development, which as mentioned before
can at the same time be conceived as a way to achieve certain
foreseen objectives.

Now, at the risk of falling into academism and generalization,
we shall enunciate the principal characteristics which are at-
tributed to the economic structure of countries insufficiently
developed.
It is commonly affirmed that an underdeveloped economy is
characterized by the following factors:
1. A low capitalization
2. A low productivity
3. A low per capital income level, as a consequence of the
low productivity prevailing in economic activities; and a
very deficient income distribution

1 Juli~n Alienes Urosa, "Tesis sobre el desarrollo econ6mico de Cuba,"
El Trimestre Econdmico, XIX, No. 1 (Mexico, 1952).

ECONOMIC TRENDS

4~. The existence of great unfulfilled primary needs
5. A high percentage of the economically active population
engaged in primary activities (agriculture, hunting, fishing,
forestry )
6. The existence of the well-known phenomenon of unemploy-
ment, especially in agriculture
7. A deficient communication and transportation system
caused by having a great number of areas excluded from
the exchange economy and by stimulating subsistence pro-
duction and multicellular economies
8. The formation of "inframonopolies" in the production
field and of monopolies of middlemen
9. The existence of an unfavorable interchange in the field
of international trade.
As mentioned above, economic development could be con-
sidered as a function of capital formation, which is the same
as saying that investments are required in order to initiate a
process of economic development. "Since the lack of capital is
one of the basic characteristics of an underdeveloped country,
it could be thought that an investment is the starting point of
such a process, generally at a higher sum than that being ob-
tained. Here is where vicious circles appear common to the
underdeveloped countries: a country is poor because it has not
been developed; it has not been developed because of lack of
capital; it lacks capital because it does not save; and it does
not save because it is poor. This vicious circle is broken by
an additional investment. But this investment has to be financed
from somewhere. If it is from the country itself, it has to be
through a better use of existing savings or capital already estab-
lished, if not through foreign sources."2
It is undoubtedly true that countries economically weak are
determined to develop their industrialized economy in order to
attain the above objectives. It is still too premature to pretend

2 Nacional Financiera, Dicima Octava Asarnblea General Ordinaria de
Accionistas (Mexico, 1952).

The Caribbean

to estimate the results in comparison with the efforts made,
since the process of economic development covers several gener-
ations. Therefore, the central theme of this summary consists
in outlining what are the most important problems faced by
Latin America and what are the factors obstructing the rapid
evolution of its economy.

III

To a greater or lesser degree it can be said that Mexico and
the nations of Central America and the Caribbean area have
the characteristics attributed to underdeveloped economies. Ac-
tually, in all of them the income level is low, and income is
unevenly distributed. The structure of occupations indicates a
strong dependency on primary activities, where the higher per-
centage of the economically active population is concentrated.
The character of foreign trade is that of so-called colonial
countries; that is, their exports consist principally of raw ma-
terials and these are little diversified; on the other hand, their
imports are very diversified, causing an unfavorable interchange
relation.
According to data obtained through research carried on by
the United Nations, in 1939 the per capital income in various
countries of the area now being discussed had the following
totals: El Salvador, $45; Guatemala, $48; Haiti, $50; Domini-
can Republic, $51; Mexico, $61; Cuba, $98. By 1947 the
following changes had taken place: El Salvador, $87 (gross
national product); Guatemala, $128 (gross national product);
Haiti, $25; Dominican Republic, $86; Mexico, $190; and
Cuba, $341. These figures are considerably lower than those
for industrialized countries, and consequently Cuba is the best
situated in this group.
The changes which occurred between the years specified can
give only an approximate idea of the course followed by eco-
nomic evolution in each of the countries mentioned. The real
income and the population are the two elements integrating

ECONOMIC TRENDS

what is known as the "economic development rate," which is
the criterion for the economic development. That is, as long
as the increase of the real income exceeded the population in-
crement in a given period, a development occurred whose magni-
tude derives from the relation between the percentage of the
real income increment and the population increment. However,
not all income increase can be attributed to the development
itself, which comes from a persistent flow of investments accord-
ing to the definition we employ from the beginning, but may
be due to random factors, such as the improvement in prices
of exported products and a good harvest, factors generically
known as "economic improvement" and not as "economic de-
velopment."
Data on the per capital income of the countries given above
are insufficient to determine the magnitude of the development
rate. Nevertheless, with the exception of one country, all figures
indicate considerable increases during the period. These in-
creases should be expressed in actual terms as deflationary
increases. However, while there seems to have been an improve-
ment in the income levels of the countries listed, the uneven
income distribution is a phenomenon which has become greater
in the last few years. In Mexico, for instance, salaries and wages
in 1939 reached 30.5 per cent of the national income, whereas
profits were 26.1 per cent; in 1950, salaries and wages decreased
to 23.8 per cent of the national income, while profits increased
to 41.4 per cent. Even without complete information it can
be said that a similar trend exists in all the countries mentioned.
The deficient income distribution lessens the purchasing power
of great population groups, causing a reduction of the domestic
trade toward which the national production is directed. Further-
more, the high resources available from profits are not utilized
in productive investments but are used in the acquisition of
superfluous goods, which results in a lack of balance in national
demand and consequent loss of currency.
Factors which are characteristic of insufficiently developed
economies are strongly noted in regard to the national income

The Caribbean

composition as well as to the occupational structure. In Mexico,
for instance, commerce and finances occupy first place in the
national income composition, but these are representative of
only 10 per cent of the economically active population. The
manufacturing industry contributes about 25 per cent of the
income and occupies only 12 per cent of the active population,
whereas the primary activity of agriculture contributes 20 per
cent of the income and represents 61 per cent of the active
population. This shows the low productivity of the latter and
the low income level of persons depending on primary activities.
In Guatemala, agriculture represents 75 per cent of the eco-
nomically active population and produces 57 per cent of the
national income. In Honduras, agriculture, which absorbs 83.4
per cent of the active population, including nonpaid household
members (or 76.4 per cent excluding the latter), produces 55.0
per cent of the national income. Industry occupies 6.0 per cent
of the population and produces 8.8 per cent of the income,
while commerce occupies 2.0 per cent and contributes 14.4 per
cent of the income; other activities follow in declining order.
Among the countries comprising the Caribbean area, only
Mexico has attained a certain degree of industrial development.
This has permitted the diversification of its production in this
field, including goods for immediate consumption as well as
raw materials and items for durable consumption, and some
other kinds of goods. In the other countries, industry has the
characteristics of the underdeveloped nations. In Cuba, how-
ever, the sugar industry contributes 30 per cent of the national
income. But on the other hand, great quantities of this product
are assigned to the foreign market. Cuban economy, therefore,
depends on this product and on the foreign market.
Light industries producing consumer goods characterize back-
ward countries. There are industries in Guatemala producing
foods, beverages, tobacco, and some textiles, but even in these
lines it is necessary to resort to importations to fulfill consumer
demand, especially of foods. On the other hand, the increase of
industrial production in the last few years has tended to be

ECONOMIC TRENDS

lower than the increment of per capital income, which indicates
that industry has lost ground in its contribution to the total in-
come of the country. In Honduras, 99 per cent of the so-called
industrial establishments are actually manual labor establish-
ments and employ less than five workers. They lack machinery,
and their working methods are backward, for they have at their
disposal only hand tools. But while manual labor establishments
reach such a high proportion, the investments in them come
only to 9.8 per cent of the total. The remaining 90.2 per cent
of such investments corresponds to the actual industrial estab-
lishments, which numerically hardly reach 1 per cent of the
total. The existing industries in this country are: foods (sugar,
flour, vegetable shortening, and oils), beer, wearing apparel
(shirts and shoes), soap, candles, chemical products, matches, and
pharmaceutical products. There is some mining. Properly speak-
ing, there is no textile industry. As far as power and fuels are
concerned, firewood represents 99 per cent of the domestic con-
sumption and 20 per cent of the fuel used for industry. Similar
situations prevail in almost all the remaining countries of the
Caribbean area.
In the field of international trade, exports are composed of
a few products originating from primary and extractive activi-
ties (including Mexico). In Guatemala, as well as in El Salvador
and several other countries, the principal exported product is
coffee. In Honduras, banana exports of the United Fruit Com-
pany come to 70 per cent of the total export value, coffee
reaches 10 per cent, and wood is the other exported item. The
export total reaches 39 per cent of national production. In
Cuba, sugar constitutes the basic export item. The course fol-
lowed by economic activity in this country is subject to the sugar
production cycle. Products originating from these countries
flow chiefly to a single market--the United States. Competition
among themselves is subject to production and exportation quotas
and set prices, which make still more acute the unfavorable
interchange relations.
Exports lack diversification in Mexico also. In 1950 and 1951

The Caribbean

fifteen products represented 74 per cent and 69 per cent, re-
spectively, of the total export value. Of these products, four
were minerals (metallic and concentrated lead, metallic and
concentrated zinc, metallic and concentrated copper, and ster-
ling silver), amounting to 25.8 per cent of the 1951 exports;
four were vegetable products (peeled coffee beans, cotton plants,
sisal hemp, and forage), reaching 30.7 per cent; two were
animal products (fresh or frozen fish and shrimp), representing
4.7 per cent; two were semimanufactured products (yarns, sisal
threads and cords, and stringing thread), amounting to 1.6 per
cent. Petroleum reached 3.9 per cent, and only one manu-
factured product, cotton materials, had some importance in
regard to exports, since it came to 2.1 per cent of the total value.

IV

In broad terms, the most important problems faced by the
Caribbean area countries in the development of their industries
are: scarcity of capital; lack of raw materials; high prices; low
productivity; technical backwardness; lack of trained workers;
deplorable living conditions of laborers which affect their health
and their working capacity; deficiencies in the transportation
systems; scanty development of the basic industries, such as
power and fuels; and a limited market.
In Mexico it has been possible to achieve a higher degree of
industrial development in comparison with other Latin Ameri-
can countries because of the agrarian reformation, a consequence
of the democratic-bourgeois Revolution of 1910, and because of
the strong public works policy and the measures taken for in-
dustrial development, which have enlarged the domestic market.
But the increasingly uneven income distribution and the rising
inflation seriously threaten to obstruct possibilities for new ad-
vances.
In almost all countries of the Caribbean area an agrarian
reformation, prerequisite to the economic development, has not
taken place, and the economic structure has definite semifeudal

ECONOMIC TRENDS

and semicolonial characteristics. The development of the do-
mestic market, toward which national production should be
directed (meaning that industrial development should be indig-
enous), represents one of the biggest problems in their eco-
nomic evolution. Most countries have a wide potential market
among the rural population which cannot be incorporated in
the exchange economy unless an agrarian reformation takes place.
There is an urgent need in all these countries to obtain a
better distribution of the national income. But we do not think
that a redistribution of the income would by itself be sufficient
for the attainment of social welfare, since the per capital income
figure is very low. The existence of nonfulfilled primary needs
in the population will be gradually resolved only through con-
siderable increases in national production. However, it is neces-
sary to halt the intensification of the uneven income distribution
and, whenever possible, to redistribute it.
What is now important is to obtain an increase not in the
total income but rather in individual income in order to guar-
antee a growing effective demand which will insure an economic
activity level and greater social welfare.
The better utilization of available financial resources (through
channelization toward productive activities and through strict
selection of imports, whose volume should be in accordance
with the purchasing capacity of the countries), a policy of
industrial protection in all its forms, the intelligent handling of
fiscal policy, and the diversification of markets constitute the
principal tools for an attack on the economic development
problems of these underdeveloped countries.

4

Frank K. Bell: TRANSPORTATION IN THE
CARIBBEAN

IT IS AN HONOR for me to be afforded again the opportunity
to address the annual Caribbean conference. My company, with
so many interests in the Caribbean, is profoundly interested in
the decision of the University of Florida to have a sustained
program aimed at encouraging attention to the economic, cul-
tural, and educational aspects of the Caribbean area. The coun-
tries of the Caribbean represent the majority of the most
intimate neighbors of the United States, their strategic position
assuring them always a place of principal importance to our
country. The University is to be congratulated on its choice.
We who are attending this conference have come together
because we have sincere common interests in the progress of the
Caribbean. Some of us are primarily concerned with cultural
patterns there, some with philosophical and sociological designs,
but all of us must admit that the paramount immediate concern
is the bettering of that area's economy. We are agreed, I believe,
that there is a promising future for the Caribbean, one that will
be economically sound and that will bring with it a firm security
for that region's people. Our confidence is founded in the ac-
knowledged existence of rich plantations, great unexploited
mineral wealth, untapped forest products, areas of unfathomable
hydroelectric and agricultural promise, and a vast sea which in
itself can yield economic well-being. But the chronic frustration

ECONOMIC TRENDS

that often impedes our dreams for the Caribbean is in our in-
ability thus far to bring all these dreams to the fruition they
deserve. Once they achieve reality, we are aware that the richest
market in the world lies waiting.
The Caribbean area is the nearest subtropical region to the
United States, which country is the logical outlet for the area's
natural products. That it- not always is the outlet may be at-
tributed to the fact that real Caribbean products are often so
inefficiently marketed as to be uncompetitive, and that many of
the area's potential products have not been able to reach the
stage of exploitation. Now, it is my contention that effective
transportation is not only indispensable to the solution of these
problems but may well be the first and most important objective.
It is everywhere evident in the pages of history that no nation
has ever reached advanced development without adequate means
of moving its goods and peoples. Yet when we speak of de-
velopment of the Caribbean countries, we do not often consider
simultaneously the improvement of transportation, which I be-
lieve is the first essential to that development. Transportation is,
and always has been, a part of production. When it is improved,
run with foresight, planned and operated with business acumen,
it is an efficient and vital factor in production. When transporta-
tion is inefficient or nonexistent, except in primitive forms, the
competitive economic development of an area is stifled. The
latter condition is the diagnosis of the economic somnolence that
once afflicted so many of the Caribbean countries. Yet with the
rapid strides toward improvement in recent years, it seems that
the patient is out of danger. We can hope that he will be swing-
ing both arms as he relishes the loss of the affliction, and that
do-or-die he is determined as never before to make himself felt
in this world.

The title of my paper, "Transportation in the Caribbean," is
perhaps too brief ; possibly it could better have been "Trans-
portation-the Development of Trade and Travel in the Carib-

The Caribbean

bean." There is, of course, no transportation without things
and people. It is my desire in this talk to expand the conven-
tional constrictions of transportation-roads, rail, air, and port
facilities--and to treat this subject as the integral unit that it is
and must be in the economy of an area.
A few days ago I was watching with interest the adroit ma-
nipulation of dugouts by the Djuka Negroes in the jungles of
Dutch Guiana. This method of transportation, which goes back
to cave-man days, is one extreme of the breadth of transporta-
tion used in the Caribbean, the other being the modern planes
traveling with a speed which brings the whole area within a
few hours of any part of the North American continent.
To the movement of people must be attributed the primary
motive for transportation; for instance, the development of the
raft and the dugout canoe, which together served as the first
means of transportation by water. But a large share of the ex-
pansion of transportation must be laid at the door of the essential
need of moving the world's products. The Caribbean area is no
exception to this rule, where, in addition to the movement of
native goods associated with the tropics, basic natural resources
available in large supply have brought transportation services
beyond normal demand.
The development of bauxite in the Guianas, and now in
Jamaica and in other places in the area, has been more respon-
sible than any other one resource for the expansion of transporta-
tion in the Caribbean. The vessels necessary to transport the
bauxite to the United States and Canada have been available
to carry southbound cargoes, and this circumstance has had its
effect on practically every phase of the area's economic life.
First there was a need, in order to obtain any part of the
southbound traffic competitively, to service practically the entire
area en route to the mines. As trade expanded from the initial
service to a handful of ports in the Caribbean, shipping facilities
were increased to the point where the bauxite vessels now visit
over sixty ports on their southbound itineraries. Only a com-

ECONOMIC TRENDS

paratively few ships would be required to transport the bauxite
without calls elsewhere, but in order to meet the cargo demands
en route to the mines, there are now available to the Caribbean
area for cargo transportation over one hundred vessels which
would not be there if there was no bauxite in the area.
Then, in order to assure the support of the importers who are
invariably also exporters, some northbound service is necessary,
which is supplied by the bauxite carriers as cargo is offered.
If the freight patrons of a shipping line and the countries a
line serves can be furnished passenger service, there is increased
probability of support. As a result, the lines handling bauxite
arrange passenger accommodation on most of their vessels. In
the case of the Alcoa Steamship Company, special vessels are
commissioned to offer the highest type of service to encourage
tourism.
I use bauxite as an illustration because it is a product with
which I am intimately familiar. Yet the same type of develop-
ment has resulted from the movement of oil, sugar, bananas, and
other products. The by-products of this type of transportation
development are as important, if not more important, to the
economy of the Caribbean area as the transportation itself. Each
year many millions of United States dollars are expended on
shore installations, wages, services, taxes, and local products.
The recent activity in connection with the iron deposits in Vene-
zuela will undoubtedly contribute considerably to the transporta-
tion facilities in the area.
That semiprimitive region that fans out above the Orinoco
delta will enjoy much of the same kind of development beyond
the primary design of opening its unrivaled ore deposits to the
world's industrial markets. It is assumed as a first condition that
many, many months are necessary for preparing avenues of
transportation that will be the master key to the realization of
these rich resources. In the latest dispatches from the area
of Ciudad Bolivar, we hear of tremendous projects for river-
dredging, dock facilities, tracks for ore-cars, and expressways to

The Caribbean

that previously almost unknown area which so long concealed an
entire mountain of iron ore: Cerro Bolivar.

I have used bauxite as an example of how a product can be
responsible for development of transportation. I believe it will
be of interest to include a little that is more specific concerning
my company in connection with bauxite, for I feel that the
Aluminum Company of America, through its subsidiary Alcoa
Steamship Company, offers an example of successful and wide-
spread economic development through transportation. There
is no need to emphasize the singular and dominant role that
transportation has played in making available to the aluminum
industry in the United States and Canada the superior resources
of bauxite ore in Surinam and British Guiana. It is too ele-
mentary to say that the problem of transporting the ore to North
America was merely one of hiring or building a fleet to do the
job. In reality, the task was big enough to give birth to what
is now one of the largest shipping companies in the United
States, and after thirty years of service, which my company
celebrates this year, we must still face and meet successfully
every day new problems which transportation imposes upon a
product that is to be marketed competitively.
Apart from the fact that we have achieved the original pur-
pose of providing a steady flow of supply for the ever-broadening
aluminum industry in the United States, this one transportation
company alone has been responsible for ramifications that are
felt far beyond Surinam and into the entire Caribbean. You
have but to visit Surinam for a few hours to grasp how the
overtones of this single-purpose transportation job have re-
sounded in the national life of a country. I say single-purpose,
which the transportation of ore ostensibly is, but it became much
more than that. Rivers existed, which made entry into the
bauxite lands of the interior possible. But such rivers, with
shifting, uncertain bottoms, following courses like the spiral

ECONOMIC TRENDS

binding of a book. And from the time the first steamer began
to follow this tortuous route until this very moment, there has
been and still is going on a constant study and investment
towards an improvement in the method of transportation. The
impact of this continuous improvement has been felt by Suri-
nam's economy with the expenditure of millions of dollars, the
employmentt of millions of man-hours, and the compounding
of national awareness of resources due to a constant increase
an their availability.
If you visit the Moengo mines, ninety miles up the Comme-
wijne and Cottica rivers, you will see the kind of things this trans-
portation is responsible for in Dutch Guiana. A whole way of
life unlike anything else in Surinam has grown up in what was
~nce a little native village. The hundreds of native employees
have taken to neat, clean streets, clubs, private homes, well-
itocked grocery stores, and a motion-picture theater.

III

One problem in transportation within the Caribbean area
remains, minor as it may be in relation to the transportation
-equirements as a whole; it is the need for inexpensive but de-
~endable passenger and freight service between the islands. For
the people of low income, there remains the now rather anti-
Juated and undesirable passage by schooner. The high operating
:0sts of ships and planes, together with other operating difficulties,
nake it impracticable to offer the low-priced transportation
servicee which used to be available years ago.
Up to the start of World War II, the once thriving schooner
.rade was slowly giving way to more modern methods. During
.he war, when all transportation was on a priority basis, only
limited steamer service was allocated to the Caribbean, and for
:he first time the schooners available were put under government
>ool control, the result being that except between one or two
nain points in the area, they became the mainstay for the move-
nent of essential cargo requirements between the islands. Since

The Caribbean

the war much of the control of schooner movement has been
retained. It is hoped that schooners will continue to hold their
position, furnishing at least the bare essentials of transportation
for the lower-incomed, until such time as the economic standards
of the people and local trade development can advance suf-
ficiently to provide enough freight and tourist traffic to warrant
the improvement of the presently limited facilities offered by
transportation which originates outside the area.

IV

Without the stimulus of tourism, the natural movement of
people in the Caribbean--either by those within the area or
from outside--has, certainly in the past, never been of sufficient
economic weight to support a passenger service by sea. The
attempts to furnish this service either by ordinary private enter-
prise or by subsidy have all eventually failed. Even as tourism
develops towards a year-round activity, many of the countries
in the Caribbean, without facilities for tourists, suffer from lack
of regular surface communication and means of travel. To a
great extent airplanes have come to fill this breach, and there
are few points in the Caribbean which are not now served by
regular and efficient air service.
Volumes could be written on the great benefits contributed
by air transportation. The Caribbean area is limited in the
methods of communication open to development because of the
sea, which separates most of the countries from each other. The
airplane, not having to meet surface transportation problems,
has been a major factor in the comparatively rapid commercial
expansion of the Caribbean in the past two decades. The oppor-
:unities for visits by American businessmen have enormously
increased, the demand for quick delivery of perishable goods
and other urgently needed commodities has been met, fast mail
communication has been furnished, and, last but far from
least, it has been possible for tens of thousands of short-vacation
tourists to enjoy the incomparable attractions of the area.

ECONOMIC TRENDS

There is no denying that the Caribbean was one of the first
areas of development in the New World, development both of
economy and of its copartner, transportation. Here, in the
Carib Sea and its companion body of water, the Gulf of Mexico,
was for the first maritime pioneers in the New World a mag-
nificent highway of commerce, a well-protected body of water 50
per cent larger than the Mediterranean, with a much larger num-
ber of islands and greater continental frontage, offering lands of
greater producing promise.
It was a great era of transportation, implementing a sweeping,
if not far-sighted, economic boom. The riches of this region--
the gold, the cocoa, the pearls, and the sugar--fell to whatever
colonizer could man the best transportation, both commercial
and military, for in those unsettled days the man-of-war was an
integral support of a merchant fleet. Before long the lion's share
of this New World prize uncovered by Columbus fell to Eng-
land; and there it stayed, partly due to superior bottoms and
partly to the Navigation Acts of Cromwell's time, which pro-
hibited ships of other nations from trading with English planta-
tions, as some of the West Indies were called. England's
superiority on the Caribbean Sea was maintained by a small,
efficient, tight ship which was named after the area. It was
called the West Indian Free Trader, and it maintained the
economic lifeline to the West, just as the large and famous
Indiaman provided the riches of an empire in the East for the
East India Company and its board of directors on Leadenhall
Street. When Donald McKay of Boston built the clipper, a
ship that could sail twice as fast as the West Indian Free Trader,
the English were immediately thrown upon the defensive. To
protect what had been a virtual monopoly upon trade, they
were forced to go through a complete transformation in ship-
building design, dropping their bluff bow and broad beam, to
emulate the long, raked, and speedy clipper ship.
By meeting the challenge of better ships and thus recognizing

The Caribbean

the necessity for unceasing improvement of transport, English
commerce protected its Caribbean investment of three hundred
years' standing, until the great world wars of the twentieth
century. One could, after World War I, however, prophesy the
incipient weakening of that control. With World War II, the
complexion of transportation and trade in that region underwent
a radical change into the condition that we have today. The
recent great war had its most important effect on that area in
its stoppage of the traditional flow of capital from Western
Europe.
While the United States had a serious interest in the political
entities and composition of this hemisphere, that concern was
not matched by a similar interest in trade and transportation
outside our own borders. It is amazing how insignificant the
American impact was upon these two categories from, say, the
year 1850 until the 1930's. In fact, in that century there was
a decline of United States interest in transportation and trade
routes over the entire Latin American region; and only spasmodic
instances can be found of a desire to continue the tradition of
those early Yankee merchants whose economic interests were
so strongly interlaced with those of their fellow colonies to the
south. Nevertheless, during that time the United States was
experimenting and building on its own frontier a great network
of transportation and construction which is now a valuable back-
ground for the postwar role of American business in developing
similar enterprise in partnership with its Caribbean neighbors.
Today we see finally the overseas arms of the great United
States manufacturing and trading companies building and in-
vesting with American capital, and placing their stake on the
continually improving efficiency of transportation.
Now, what direction ought this comparatively new American
influence take in the realm of transportation? First, it is
hoped that examples of successful private enterprise will be
encouraged to create an incentive for investment from within
the Caribbean toward better facilities, and toward elimination,
for instance, of extra cargo movement involved in lighterage

ECONOMIC TRENDS

when it is possible and practicable to build deepwater harbors.
It is hoped, in this connection, that the traditional antipathy to
investments beyond the home plantation itself pn the part of
the landowners who control so relatively large a share of avail-
able capital may give way to more farsighted policies, policies of
capital risk that are hardly risk at all when the~ contribute to
creating more efficient methods of moving go ds to market,
thereby increasing their competitive worth. It is hoped that the
disheartening lack of development of native resources in favor
of similar development in more removed and less strategic areas
will no longer be laid at the doorstep of inadeq ate transporta-
tion. And it is hoped that a great new consciousness of the
indispensable factor of transportation improvement will make
itself felt as never before in the two million s uare miles of
Caribbean lands. Such a consciousness will bel an enormous
contribution toward the prosperous future whicd lies in wait.

VI

I have attempted in this paper to show the interdependence
of transportation and economic growth as it applies to the
Caribbean area. Time does not allow me to give details of the
far-reaching effects of this interdependence. Ecgnomic growth
depends on a great variety of factors, but there ardl none to which
transportation does not contribute. Transportation brings out-
side capital investments in port facilities, it brings employment,
tax revenue, modern handling of personnel, dpvelopment of
foreign trade, new consumer goods to stimulate the desire for
higher living standards, a need for services othbh~rwise not de-
veloped, and also the tourists eager to divest themselves of
millions of dollars of vacation funds.
Countries in the Caribbean should continually bear in mind
the need for constant encouragement of transpo nation interests.
I cannot say that there has been any lack of encouragement,
but at times one is led to suspect that not enough thought is
given to the advantages transportation connections can bring,

46 The Caribbean

particularly when consideration is being given to foreign trade
restrictions, taxes and regulations, facilities for tourists, physical
installations, and many other things which can be helpful, but
which, when the wrong decision is taken, may have a deleterious
effect on transport development.

John Akin: ENVIRONMENT FOR UNITED STATES
ENTERPRISES IN THE CARIBBEAN

SHAD NOT intended to talk to you today about "relations"
with Latin America or with the countries of the Caribbean area.
That subject, it seemed to me, was far too broad to discuss in
a brief period. We are concerned with about a dozen different
nations, and I do not believe that our relations with Haiti are
the same as they are with Colombia, or the sapie with Costa
Rica as they are with Mexico. There are too plany different
Actors to consider.
But "relations" are made up of many things, including po-
itical, cultural, and economic--the usual headings. The way
Ne look upon each other is governed principally, I believe, by
:he factor which brings us most often into contact with each
their That must be business.
Then we come to "What type of business?" If you export
,r import, you certainly write to your customer oq' your supplier,
ts the case may be. Perhaps you visit each othyr periodically.
But if you go into a country and set up your establishment there,
rou are living cheek by jowl with the nationals bf the country.
You have to get to know each other's good qualities and failings.
ivore than that, you get to know what your hosts think of you
Ind your methods, and you find out whether they want to make
t pleasant for you to remain and to have more of your com-
>atriots join you.

The Caribbean

I would like to review with you that very subject insofar as
the Caribbean countries are concerned. Do they like the United
States people and business concerns already in their countries,
and, if not, why not? Do they want more of us to come in with
all our vaunted abilities and techniques as well as our capital?
Do their laws and customs and their general treatment of for-
eigners hold attractions for us? In a word, what is the environ-
ment for United States enterprise in the countries of Middle
America?
These are not easy questions to answer, and it can be mislead-
ing to generalize. We have all heard of spectacular examples,
such as the Mexican expropriation of foreign-owned oil com-
panies and the Guatemalan government's harassment of the
United Fruit Company. We have also seen the profitable and
fair treatment of the oil companies in Venezuela. These are
matters of record. I mention them simply because any United
States business firm considering a substantial investment abroad
will look first into the historical treatment of foreign capital and
the record over the past. It will not be satisfied with only recent
pronouncements or enticements.
The potential investor naturally must see reasonably good
prospects of earning a satisfactory return in a currency he can
use. North American private capital has often shown reluctance
to move into countries of the Caribbean, and there have been
practical or psychological barriers in some countries on which
this reluctance was based. I think that it may be constructive
to mention a few of these.
First of all, there is the political situation. We know that in
many Latin American nations there has been a record of re-
peated upheavals and sudden changes in government by un-
democratic means. Such changes have sometimes resulted in a
new government's disregarding agreements with investors. This
has frightened away new capital which might have been used
productively to better the standard of living.

ECONOMIC TRENDS

The second barrier has been the trend towards extreme na-
tionalism in some countries, which has resulted in threatened or
actual expropriation of foreign-owned property without proper
compensation, followed by discriminatory legislation against the
enterprise and its personnel.
Another major barrier has been the lack of confidence in the
foreign exchange situation of some countries where there is a
record of several currency devaluations created by recurring
periods of dollar exchange shortages. These occurrences have
entailed serious losses to investors and have made it difficult,
if not impossible, to earn a reasonable profit on the original
capital investment.
At this point, I want to make it clear that I am not referring
to all Latin American countries; some of them have indeed of-
fered fair and favorable climates for foreign capital. In some
others, however, the barriers I have mentioned do exist, and
United States enterprises have suffered unhappy experiences
which have created fears in the minds of others who in different
circumstances might have taken the step.

Why is it that American companies are interested in investing
in the countries of Middle America? The principal purpose, of
course, of all private business investments in the United States or
anywhere else is to make money. It surprises me sometimes how
many people do not understand this simple fact. Certainly when
you or I put our hard-earned money into any proposition, other
than charity, we want the assurance that the principal can be
recovered and that we have an opportunity to earn a reasonable
return in profits or dividends.
By their very nature, investments abroad constitute a greater
risk than those at home, and the businessman will want to see
an opportunity for a wider margin of profit than he would ex-
pect in his own country. Many American business firms do
see an evidence of opportunities for business development in

The Caribbean

the countries of the Caribbean area, but existing barriers or ap-
prehension over the treatment they would receive have made
them hesitate.
I do not think it is necessary to go into detail concerning the
advantages that will accrue to the recipient country in welcom-
ing private venture capital from abroad. The great advantage
is economic development. Private capital investment is the basic
key to that development and, wherever there is a lack of suf-
ficient domestic capital, economic development will not go for-
ward without foreign private capital.
Here I must point to Venezuela as a nation which has been
a shining example of the open door to private enterprise and
foreign capital development. When one considers the fact that
Venezuela today has a strong national economy and currency,
practically no internal or external debt, good roads, housing,
hospitals, schools, and an average per capital income three times
that of the rest of Latin America, it is difficult to understand
how other neighboring countries can fail to follow her example.
Venezuela now receives an income from petroleum taxes alone
of almost $700,000,000 a year. Her record of fair treatment of
foreign capital has served as an assurance to two major American
steel companies in their recent investment of half a billion dol-
lars to develop the country's iron ore resources.
Of course, other examples of rapid economic development,
due in large part to the entry of foreign capital, can be found in
our own country and in Canada. The United States, itself, we
are apt to forget, was a net debtor country until ten years before
the first World War.
Fear, therefore, is the deterrent to increased United States
capital investment in most Latin American countries. But there
is a formidable set of fears on the receiving end as well as on
the investing end. There is the fear of economic colonialism;
that is, that the foreign capital will be concentrated in raw ma-
terial development to the neglect of broad manufacturing, proc-
essing, and agricultural production for the home market. There
is the fear that the recipient country will realize too little in the

ECONOMIC TRENDS

way of direct returns from foreign investments, particularly in
enterprises producing raw materials. There is the fear that
foreign investment endangers national sovereignty through eco-
nomic imperialism. Finally, there is the fear that development
of extractive industries may perpetuate economic weak spots
because of the unstable record of the commodity markets.
In my opinion, one good look at what has gone on in Vene-
zuela should dispel all these fears. From 194~3 through 1950,
more than 3 billion barrels of oil were produced from United
States investment with a sales value of over 5 billion dollars.
Out of this revenue, 2 billion dollars went directly to the Vene-
zuelan government in royalties. One and a half billion dollars
was spent for machinery and supplies purchased abroad but
which were moved into Venezuela. One billion dollars was
spent on wages and salaries in Venezuela, and only 680 million,
or 13 per cent of the sales revenue, was transferred out of the
country as dividends to the overseas investors.
No one in his right mind and in possession of the facts would
accuse any of the United States oil companies in Venezuela of
being imperialists or meddling in local politics or governmental
affairs. Their record is spotless.
The fact is that United States private investment in the coun-
tries of Middle America, aside from Venezuela, has been dis-
appointingly small. But here I want to point out that the basic
reason is not entirely the lack of a hospitable "climate." I men-
tioned a moment ago that capital investments in new enterprises
and in foreign countries have always been risky and that, there-
fore, a high rate of return on successful ventures must be the
incentive. The mounting tax structure in our own country has
taken such a large percentage of the return of successful ventures
that a great deal of the incentive is lost. Our government has
often proclaimed the necessity for additional private investment
abroad, but it has not taken constructive steps in the tax field
to promote this investment. There must be a modification of
the present procedure of taxing returns from foreign invest-
ments by the full difference between the United States rate and

The Caribbean

the taxes paid in the area where the earnings originated. I urge
:hat more conventions for the avoidance of double taxation be
negotiated with Latin American nations.
While speaking of the part which our government can play
in developing a more receptive attitude abroad for investors, I
shouldd like to mention that over the past few years a conception
2as grown in many countries that American public funds,
through loans or grants, are available for projects which can
mnd should be financed by private capital. To quote from the
Final Declaration of the 39th National Foreign Trade Conven-
ion held in New York in November, 1952:

[t is obvious that no progress will be made toward opening the
loor to the entrance of private capital from abroad, and par-
:icularly from the United States, so long as other nations believe
:hat they can draw upon American public funds, and can there-
>y escape the obligations and self-discipline which the attraction
mnd use of private capital would entail.
It cannot be urged too strongly or repeated too often that,
if economic development in Latin America or any other area is
to proceed along sound practical lines, the major role must be
reserved for private enterprise rather than governmental subsidies
,r loans. The Caribbean area abounds with practical examples
3f the increased productivity, the enhanced earning power, the
higher living standards, and the improvements in health, sani-
:ation, and education which have occurred where a fair oppor-
:unity has been provided for the entry of American private
capitall with its experienced management and advanced tech-
liques. The areas of economic stagnation, on the other hand,
Usually coincide with those of a lack of foreign private capital
investment.

III

Now, what can the governments of the Middle American na-
ions acquiring outside capital do to bring about a more hospi-

ECONOMIC TRENDS

table and attractive atmosphere for foreign investors? For one
thing, I believe that there must be an attitude of frankness and
candor which has not always existed. Those leaders holding
elective offices must refrain from resorting to the threadbare
but still politically expedient cries against imperialism from
abroad. In those countries where there is a growing awareness
of the need for foreign capital and technical experience, the
government can take practical legislative steps for fair and equi-
table treatment.
Let us look for a moment at some of the factors which have
deterred American direct investment in Cuba during recent years.
Twenty-five years ago direct investment of American capital in
that country was estimated at over $900,000,000. By the end
of 1936 this figure had declined by a quarter of a billion dollars
as a result of revaluations, reorganizations of companies, and the
general impact of the world depression. American investments
have never regained the position which they formerly held,
owing in great measure to local legislation. I refer particularly
to the laws governing employment which have frequently been
impossible to obey without grave financial loss or bankruptcy.
In the event of noncompliance, the Cuban government has in
many instances "intervened" and managed the company affected
until requirements provided in the law were met. Inefficiency
has resulted and the interests of investors have been sacrificed.
In Cuba foreign companies have been prevented from bring-
ing in persons to be trained for managerial positions. Unionist
opposition, in addition to the attitude of the government, pre-
sents almost insurmountable barriers to the employment of for-
eign technicians. To put it mildly, modifications of the law so
that foreign companies might employ a reasonable number of
experienced and trusted employees trained in the United States,
other than officers, would seem desirable.
Guatemala, it seems to me, could for the good of its own
people and the advancement of its economy deal with foreign-
owned transportation companies and plantation operators in a
more composed manner and without bending to the pressure of

The Caribbean

extreme left-wingers and communists. The present attitude does
not invite further capital investment from the United States.

IV

To return to the matter of the present environment for Ameri-
can enterprise in the Caribbean: Is the climate such as to
attract American investment, and do these countries understand
capital development as we know it? I think that the answer for
the most part must be in the negative--with, of course, certain
important exceptions. There simply does not exist a clear-cut
idea as to what American capital can do to help raise standards
of living. Furthermore, there is a somewhat different conception
of free private competitive enterprise as we know it.
Our businessmen have a problem here, and it seems to me
that with time and effort they can overcome it. Those United
States industries which have already set up enterprises in Latin
America have sometimes given too little attention to their public
relations. Frequently they have not taken the time to defend
themselves against the recurring charges of exploitation that are
the stock in trade of irresponsible politicians and of communist
agitators. This seems strange, but I believe it is so. I say it is
strange because in so many cases United States industries in
Latin America can tell an inspiring story of progress often at-
tained under severe handicaps. They have every right to be
proud of their contribution to the economic and social advance-
ment of the areas they serve, and they need apologize to no one
for the financial rewards that may have come to them.
Foreign capital in Latin America has contributed to the train-
ing and teaching of the people it employs, thus raising their
earning power and living standards. Many United States com-
panies have gone into Latin America to discover that, although
their workers were eager and intelligent, the high degree of
illiteracy kept these workers from being promoted to skilled jobs.
Some of these companies have provided educational facilities
for their employees and have thus contributed to an improved

ECONOMIC TRENDS

literacy rate. This means that many native workers who pre-
viously held unskilled jobs are today in supervisory positions.

If the story we have to tell is told simply and factually, I am
sure that it will go far to dispel the fears I have mentioned.
Perhaps it will help our neighbors to understand more fully our
own conception of the rights and privileges of private enterprise
and the limitations which we believe should bind governments.
Many people in Latin America believe that a government has
the inherent right to take over and operate private enterprises
even without fair or adequate compensation to the owners.
Almost every day we read in the news that the Salvadorean
government has broadened its supervision of foreign-owned
electric power companies, that the Costa Rican government has
taken over more United States-owned electric companies, or
that the Cuban government has nationalized another railway
system. It will take time, of course, to reconcile these different
conceptions, which are often deeply rooted.
Furthermore, it is astonishing to what extent the average citi-
zen in Latin America misunderstands the ownership of large
United States enterprises. Often he does not know that owner-
ship is distributed among thousands of shareholders, many of
whom may be, in a relative sense, no better off financially than
he is and may depend for a livelihood on the companies being
able to provide regular dividends. American business firms
should not overlook any opportunity to impress upon the minds
of people abroad that they are sincerely interested in playing
a constructive part in the welfare of the countries in which they
do business.
Finally, I submit that there must be a change in thinking on
the part of both American investors and recipient countries from
a negative to a positive outlook. This change in attitude, in
combination with complete frankness and trust, is the only way
in which the fears I have mentioned can be dispelled.

Part II

SOCIAL TRENDS

6

Carl C. Taylor: SOME LAND SITUATIONS AND
PROBLEMS IN CARIBBEAN COUNTRIES

L AND PROBLEMS cannot be settled by resolutions passed
by those not responsible for specific land situations, but resolu-
tions can state the objectives of land policies. The Economic
and Social Council of the United Nations in a resolution adopted
in September, 1951, stated the following as the basic objectives
of land reform programs: (1) to assure security of tenure to
the cultivator of land; (2) to provide opportunity for the culti-
vator to acquire ownership of land; (3) to promote the organi-
zation of land holdings into farms of an efficient size; (4) to
assure a fair share of production to the tenant. These were
prefaced by a statement that "appropriate measures of land re-
form designed to achieve improvement of conditions of agri-
cultural populations and increase agricultural production .
are a necessary part of any effective implementation of compre-
hensive programs of development."
The Caribbean Land Tenure Symposiums in 1946 listed eight
objectives of a good land tenure system. They give even sharper
focus to the part assigned me on this program. They are as
follows: (1) responsible freedom of personal action; (2) equal-
ity and dignity of all tenure groups; (3) secure possession of
rights in land; (4) equitable distribution of rights in property;
(5) conservation and development of resources; (6) highly
efficient utilization of productive resources; (7) equitable distri-

The Caribbean

bution of income; and (8) well-integrated community life.
These two summarized statements, in essence, say that when
those who cultivate the land do not own it, or when as tenants
they do not have security of occupancy or receive a fair share of
the production from the land, or do not make an adequate
living for the cultivator and his family, or when, under any of
these conditions, the results are not conducive to good com-
munity life, or to the conservation and development of natural
resources, there then exists a land tenure problem. These seem
to me to be valid and wholesome conclusions. They, of course,
force one to say immediately, and without equivocation, that
all Caribbean countries have not one but a number of land
problems.
Land problems in any country are only one part of a total
economic, social, and cultural situation. I should like to discuss
a few concrete situations in three Caribbean countries--Haiti,
Jamaica, and Puerto Rico--which illustrate this basic fact.
Before I turn to these situations I should like to make as clear
as I can the fact that, in terms of an attack on a given land
tenure problem, what appear to be identical problems in two
countries may, in effect, be very different problems. The peoples
are different. The economies are different. The historic develop-
ments have been different, and the alternatives for solution are
different. In most of the United States early settlers started as
subsistence farmers and developed into commercial farmers. In
most of the Caribbean countries slaves were brought in to help
develop a strictly commercialized agriculture. When they were
emancipated, they became either subsistence farmers or hired
men. In the United States the Industrial Revolution developed
concurrently and made possible the development of a great sys-
tem of family-sized commercial farms. The Industrial Revolution
is as yet only partially developed in most Caribbean countries.
The results have been either a recrudescence of the plantation
system, which produces export crops and is manned by hordes
of hired laborers, or a system of very small holdings, the operators
of which practice the lowest level of subsistence farming.

SOCIAL TRENDS

The problem of landlord-tenant relations, a quite universal
land tenure problem, exists in both Haiti and the United States.
There are many farms of uneconomic size in both countries. In
the United States farms are said to be inadequate in size if they
yield a gross cash income of less than $3,000. Most of these
farms either are in areas out of which people are migrating
rapidly into industrial and commercial occupations or they are
sharecropper farms, which are decreasing rapidly in numbers.
In Haiti the guarantee of the occupancy of even a subsistence
farm of a few acres is the difference between a degree of inde-
pendence and security, and beggary. In the United States land-
lords are very often operating partners with their tenants.
Practically all tenant farms are commercial enterprises to which
the owner makes a major financial contribution. The issues of
equity between the two partners can be rationally calculated.
In Haiti the landlord generally contributes nothing to the farm-
ing enterprise except the ownership of a shaky title to a piece of
land which was given to one of his ancestors a hundred years
ago. If he contributes to the operation of the farm it is by a
loan to the tenant, for which he collects anywhere from 36 to
100 per cent interest. I present this one brief contrast in order
to make the point that in terms of practical first steps toward
the solution of concrete problems, the mere statement of ob-
jectives of land reform or of the criteria of good tenure systems
is only a start.
In what follows I am not surveying the land problems of
Caribbean countries but selecting three types of attack on land
problems, each in a different country. I beg you to keep this
in mind, else the significance of what I have to say will not be
apparent.

I. In Haiti: The Artibonite Valley

Haiti was a French colony until 1825, when it was finally
granted independence as a result of the slave revolution which
started as early as 1804~. During colonial days it was operated

The Caribbean

as a slave plantation economy, the objective of which was to
produce exportable raw agricultural products. Its population of
approximately 3f/ million is almost entirely the offspring of
African slaves, brought in to operate the plantations.
Today only 10 per cent of its cultivated lands are in planta-
tions; the remainder is occupied and farmed by small holders,
owners, tenants, and squatters. Of its slightly less than 7 million
acres of land, not more than 13 per cent is under cultivation.
The country is very mountainous, and the amount of cultivated
land cannot be greatly increased. In the 125 years since the
slave plantation system was abolished, the land resources have
diminished rather than increased, and the population has multi-
plied seven times. Approximately 85 per cent of the 3f/ million
people are rural. Population per square mile is about 300. Per
capital income is $25; it is undoubtedly less in rural than in
urban areas.
Haiti has very little industry. Practically all its exports are
agricultural products, 85 per cent of which are coffee, bananas,
raw sugar, sisal, and cotton, all primarily plantation crops. Ap-
proximately 50 per cent of imports are textiles and food. The
country has only 1,700 miles of roads, fewer than 500 miles
passable twelve months in the year, and only 50 miles paved.
There are literally no central markets in the rural areas and
very little means of getting farm produce from farms to central
markets and ports. Most of the produce is therefore consumed
in farm homes. What is marketed, except from plantations,
must be carried out on the backs and heads of humans or on
the backs of burros. These are all stern facts which condition
any programs of land tenure reform.
The program I have selected from Haiti for description is
the proposed development of the Artibonite Valley, an attempt
to increase productive land. The Artibonite is the largest river
in Haiti. The lower portion of its valley is somewhat arid; the
upper has a mean annual rainfall of 122 inches. The irrigation
and flood control dam, if successfully carried through, will bring
approximately 75,000 acres under irrigation. An authority

SOCIAL TRENDS

(ODVA) has been established by law, and detailed analysis of
the area and its potentialities has been made. I understand
that the negotiation of an adequate loan from the International
Bank will soon be consummated. The project will involve flood
control, irrigation, resettlement, agriculture, power, industry,
marketing, and transportation development. If successful, as it
must be if the loan is to be repaid, the project will increase
export products, increase the national income, improve the level
of living of some farmers on the irrigated land, and conserve--
and even develop-some now undeveloped natural resources. It
will not, however, lessen the population pressure on the valley
lands or the other lands of the country.
A cadastral survey has been completed for 53 per cent of the
project area. It shows that for the area surveyed the average
size of independent operating units is only slightly more than 2
acres. The average size of ownership units is approximately 3
acres. It is almost certain that both operating and ownership
units in the unsurveyed areas are larger, but there will be no
land for additional settlers. The government owns some land
(it is not yet known how much) which is not now in full use.
There may be some land available for settlement which owners
of more than 100 hectares will be willing to sell. But some 500
families now residing in areas which the dam will flood must
be resettled.
It has been decided that water will not be supplied to owner-
ship units of more than 100 hectares (approximately 250 acres)
and that the owners and operators of over 75 hectares (approxi-
rnately 185 acres) will not be permitted to use the machinery
from the farm machinery pools to be established. The tenants'
customary rent is now 50 per cent of what they produce. It is
proposed that they will pay only 40 per cent when the project
is completed. In the portion of the area for which the cadastral
survey is completed, almost 85 per cent of the properties are now
less than 4f/2 acres in size. Because of these facts and others
which I have presented, the plan for the valley states that "any
arbitrary or sweeping change in the present ownership pattern

The Caribbean

is out of the question. Even were the consolidation of several
small owners into units of economic size plausible from other
standpoints, the fact that this would displace thousands of farm
families from the land precludes its consideration."l
Because this specific case has been presented merely to illus-
trate the difficulty of applying patented land reform objectives
to all land situations--in this case primarily efficient size of
farms--I will say little more about this heroic and, I hope,
magnificent project. There are, however, other good land tenure
objectives at stake in the project. One of these objectives, that
irrigation still should be furnished to individual holders of up to
250 acres, is pretty liberal. But a second objective, that the
landlord should still receive 40 per cent "of the value of the
crop obtained from the land over and above irrigation charges,"
when he now receives only 50 per cent from his farms' arid
land, does not represent a very drastic reform in tenant-landlord
relationship. As the production under irrigation increases he will
be greatly the gainer. If it increases ten times, which it very well
may in some cases, he will be the recipient of a large unearned
increment. To compel the division of these large holdings would
undoubtedly create a problem of the maximum production of
commercial farm products. If the holdings, however, were di-
vided into let us say 10-acre farms, it requires only simple arith-
metic to calculate that from each 250-acre farm 25 small
holdings could be created.

II. In Jamaica: Land Settlements or Resettlements

Great Britain's title to Jamaica was recognized in 1670. Its
population at that time was 3,000, mostly slaves previously
brought in by the Spanish. The slave trade was abolished in
1807, at which time there were 319,000 slaves on the island.
The Emancipation Act of 1833 freed 126,000; a tremendous

1 "Land and Programs for Development of the Artibonite Valley," Vol-
ume 5 (unpublished).

SOCIAL TRENDS

number had already escaped into the mountains. It is their
descendants, and those of emancipated slaves, who constitute
the overwhelming majority of the population. The first United
Kingdom census was taken in 1844, at which time the popula-
tion was 377,430. By 1943 it had increased to 1,237,000. It is
still increasing. Population density is now approximately 295
per square mile.
The slave plantation economy was based on sugar cane,
coffee, cocoa, pimiento, ginger, and indigo. After emancipation
many estates were abandoned; many were not. Today 900
farms of 200 or more acres include approximately two-thirds of
all farm land on the island. They are producing chiefly sugar,
coffee, sisal, and bananas. At the other end of the scale are
39,000 farms of less than 10 acres in size, 26,000 of them less
than 4 acres in size. The 1943 census shows that only one-third
of the holders of more than 1 acre do any off-farm work. This
means that some 40,000 farm families must and do derive their
whole living from farms of very inadequate size.
Cumper estimates that approximately 25 acres would "yield
a reasonable living to an owner-cultivator." He shows from
1943 census data that few farms with less than 25 acres are
operated by managers and that the amount of time spent in
off-farm work declines rapidly when farms are larger than 25
acres.2 It would therefore appear that 25-acre farms, under
present conditions, are family-sized farms in Jamaica. If each
farm family were provided a farm of this size and all plantations
were abolished, there would be room for less than one-third of
the present population now living on farms in Jamaica.
Many farms with 100 or more acres are operated by managers
and hired men. More than one-half of those over 1,000 acres
are operated by managers and hired men, some of them by
managers and sharecroppers. About one-third--something over
13,000 farms under 10 acres in size--are rented. The other two-

2 George Cumper, Social Structure of Jamaica (Kingston, 1949), pp.
71-72.

The Caribbean

thirds are small holdings, many of them deep in the mountains,
occupied by the descendants of slaves who escaped and sought
freedom in isolation.
I shall briefly describe only one land reform program in
Jamaica, chiefly to illustrate a different attack on land problems
from that of the Artibonite Valley development in Haiti. Many
of the land problems of the two countries are quite similar.
Both have heavy population pressure on the land, Jamaica's
less because she has considerable industrial employment. Ja-
maica's agriculture is more commercialized because she has more
plantations, better roads and railroads, a better organized mar-
ket service, and therefore a much greater volume of export farm
products. Also, Jamaica has a better school system, a better
health service, outstanding welfare services, and a voluntary
farmers' organization subsidized by the government, which has
forty-six "branches," or community organizations, scattered
over the island. The avowed objective of this program is "to
underwrite rural welfare with adequate farm income." It,
together with the agricultural extension service and experiment
station, renders a fairly modern, if not ample, agricultural pro-
duction and marketing service. Above all, these services are
manned by educated Jamaicans who came up from a level not
too far above that of the peasants whom they seek to serve.
The land settlement program, under the Land Department,
although only one of the attacks on Jamaica's land problems,
makes use of all these services, in which many agencies partici-
pate. There are now 145 settlement or resettlement projects,
some of them for ex-service men, some for sugar estate laborers,
some for other landless small farmers. Some of the lands in
these settlements were unallocated crown lands, some were from
mortgage foreclosures, and some were purchased outright by the
government. More than 200,000 acres are included in these
settlements, and approximately 25,000 allotments have been
made. A brief description of one of them, undoubtedly one of
the best, will illustrate the results of this type of project.
This settlement was established in 1939. It is near a cane-

SOCIAL TRENDS

sugar refining plant, and many of the settlers had for years been
hired laborers in the cane fields or factory. They were allotted
tracts which were supposed to be adequate family-sized farms,
sufficient to produce the maximum of subsistence, and in addi-
tion some sugar cane as a cash crop. Both the settlers and the
Land Department testified that holders of these farms continued
for a number of years to work for wages for large cane farmers
and made minimum use of their own lands, even for subsistence
production. They testified that now all except one of them give
full time to their own farm enterprises, some of them employing
additional laborers. They grow nearly all their families' sub-
sistence needs, as well as poultry and dairy products, and sugar
cane for sale. When they turned to full-time farming and had
for some time been producing cane for the factory, they became
convinced that they were not receiving fair prices for their cane.
They were told by the factory that some of their cane was good
but that the cane of some of their members pulled down their
average; furthermore that the factory could not test for sucrose
content in lots of less than 1,000 tons. This drove them into
community crop improvement and cooperative marketing of
sugar. In this, the experiment station, an extension agent, and
an agronomist of the Land Department, assigned to the project,
all helped. The field agent also helped them organize dairy and
poultry cooperatives. When we visited the project, they had
just dedicated a substantial community building. The settlers,
who had built the building themselves, had provided it with
two health rooms. Because of this the Insular Director of Public
Health told us he would provide medical and nursing service to
the community.
Not all the 145 resettlement projects are as successful as this
one. I have briefly described its success because it illustrates an
attack which consists of more than a project. It utilizes legisla-
tive, educational, health, credit, technical, and welfare assistance,
all integrated in a long-range program. It is a general attack on
poverty, ignorance, illiteracy, and inequity. It is animated by a
militant and widespread sentiment which has for approximately

The Caribbean

fifteen years been expressed by the slogan, "Building a New
Jamaica." Professor T. S. Simey, who left his chair of social
science in 1945 to spend a year as welfare adviser to the colonial
and insular governments, discussed all of the British West Indies
and stated the principles of the process as follows: "In the long
run, progress must depend on the proper blending of stimulus
and direction from outside with disinterested leadership and
executive ability from within."3
The land settlement program and all others previously men-
tioned, however, leave one basic land problem in Jamaica un-
touched. There are still nine hundred plantations which control
and operate two-thirds of the land. By and large they include
the most fertile lands on the island. Some of the resettlement
projects and cooperative farms are on very difficult land. The
laborers working on sugar plantations have a special welfare
program with a budget of almost $150,000 per year, but they
are tragically underemployed and remain landless.

III. In Puerto Rico: Over-all Land Reform

The historical and cultural background of Puerto Rico is not
greatly different from that of other Caribbean countries. It was
a Spanish colony from 1508 to 1898. Its economy, and there-
fore its land, was developed to furnish raw products for its
mother country. For these enterprises plantations were estab-
lished and slaves imported. Throughout the 390 years of Spanish
rule, Puerto Ricans struggled for autonomy, but there was never
a revolution. The slaves were freed in 1873. In 1898, when
Puerto Rico was ceded to the United States, it had a population
of approximately 950,000. The precise ethnic composition is
not known, but it was a mixture of Indian, Negro, Spanish, and
a number of Portuguese, French, Dutch, and other European

3 T. S. Simey, Welfare and Planning in the West Indies (Oxford:
Clarendon Press, 1946), p. 181.

SOCIAL TRENDS 69

immigrants. In contrast to Haiti and Jamaica the population
was almost two-thirds white.
Under Spanish rule farm production shifted constantly from
subsistence to commercial, that is, to exportable crops, chiefly
coffee and sugar cane but also some cotton and tobacco. This
same trend continued for approximately forty years after Puerto
Rico became a part of the United States, with the result that
in 1940 0.6 per cent of all farmers owned 30.8 per cent of all
land in farms. At the other end of the scale was 73.2 per cent
of all farmers, who owned only 15.7 per cent of all land in
farms. In addition to these were the landless laborers who
worked on the plantations. They constituted 27.3 per cent of
the entire working force of Puerto Rico. About 70 per cent of
all farm laborers were employed in sugar cane production, about
two-thirds of whom had employment of no more than 175 days
per year; the other one-third had about 100 days of work. The
land reform program, which I shall briefly describe, attacked
all the problems involved in this situation. Its story is so well
known that I need not describe it in detail.
It started with a United States Congressional Act of April
24, 1900, which specified that "every corporation hereafter au-
thorized to engage in agriculture shall by its charter be restricted
to the ownership and control of not to exceed 500 acres of land."
In the face of this law, corporations and plantations continued
to keep and even accumulate larger holdings. Packard says,
"The record shows that 51 corporations owned 188,871 acres
of land in 1940 in violation of the law," and "in addition they
operated something over 60,000 acres of leased lands." These,
plus the holdings of 291 individual landowners who owned
391,917 acres, were proof that the mere passage of a law had
by no means solved the land problem of Puerto Rico.'
I need not detail the court battles which ensued when finally
attempts were made to enforce the law, or the studies and dis-

SW. E. Packard, The Land Authority and Democratic Process in Puerto
Rico (San Juan: University of Puerto Rico, 1948), pp. 53-54.

The Caribbean

cussions which preceded the passage of the Land Law of July,
1941. It is important to note, however, that it was Mufioz Marin,
now governor of Puerto Rico, then president of the Insular
Senate, who developed the idea of a land authority as an instru-
mentality for carrying out the whole land reform program. A
few sentences quoted from the preamble of the Land Law will
reveal the heart of its purpose and serve to explain why the
programs initiated under it have had the public support which
they still enjoy. It reads, in part: "It is the fundamental purpose
of this Act to put an end to corporate latifundia and to every
large concentration of land in the hands of entities legally organ-
ized in such a way as to tend to perpetuate themselves, and thus
to prevent for all time the division of the great landed estates;
and it is likewise the purpose to prevent the appearance of such
latifundia in the future." It continues: "This fundamental public
policy would not be complete if it were not accompanied by a
corollary germane to its nature and scope, the provisions that in
the case of land where for natural or economic reasons, the
division of the land is not advisable from a standpoint of effi-
ciency, the greatest diffusion possible of economic benefits of the
land may still be effected, thereby contributing to raise substan-
tially the standard of living of the greatest possible number of
families. It is with a view to this phase of the legislative purpose
that it is considered indispensable to make provision for the
creation of proportional-profit farms. .. It is also an integral
part of the moral purpose and the aims of dignity and economic
freedom embodied in the public policy of the legislative, to
furnish the means whereby the social class of 'agregados,' that
is, the agricultural laborers enslaved through the fact that they
are not the owner of even the lots where they have their homes,
will disappear from Puerto Rico. .."
To these two--the proportional-profit, large-scale farms and
the agregado allotments--must be added the family-size farm
program, the rural credit, welfare, and cooperative programs. To
use a statement of Revira-Santos, Director of the Social Pro-
grams of the Ministry of Agriculture,. "To serve each major

SOCIAL TRENDS

economic or social need Puerto Rico has established a major
institution or agency."
With this brief exposition of the basic objectives of the land
reform program and brief statement of how the program is
implemented, I can recount briefly some accomplishments.
The proportional-profit farms range in size from 100 to
approximately 1,000 acres. They are operated by managers who
receive a portion of the net profit, the remainder of which is
distributed to the field workers according to days worked and
wages received. The Land Authority supplies the land and
operating capital and receives up to 3 per cent of gross income
on the investment. It audits all accounts and supervises the
contracts with the managers, who are in fact lessors. For the
last year for which I have accurate data (194~7) the total profits
from these farms was more than $560,000, 65.8 per cent of which
was distributed to the almost' 16,000 laborers who participated.
Their shares averaged only $23.07, but they had received regular
wages during the season and were practically all recipients of the
benefits derived from living in agregado communities (Title V).
To the people farthest down on the agricultural ladder, the
field workers, the land reform has meant most. Even so, their
problem is not yet completely solved. It is estimated there were
107,000 of these families who worked on sugar, coffee, and
tobacco plantations before the reform program started. They
were for the most part landless squatters. They had about 170
days labor per year, most of them on the sugar estates. The first
allocation of lots in a planned settlement was made in 1942. By
September, 1952, allotments had been made to about 22,000
families in 189 settlements. Governor Mufioz Marin has requested
that all remaining agregado families be made allotments within
the next seven or eight years.
Their garden plots range from one-fourth of an acre to three
acres in size. The land is held in usufruct. The Social Programs
Administration assists with educational, health, welfare, and co-
operative services. It has funds to lend to cooperative housing
projects. It now has some bulldozers and well drills to assist in

The Caribbean

building roads and streets and to help settlers provide water.
Basically, however, the program is one of aided community self-
help. It has constructed streets, water systems, cooperative stores,
schools, churches, community buildings, and athletic fields.
Many of the self-built houses are very bad, but some of the new
self-help cooperatively built cement block houses are good.
Family income is still low, calculated to be $285.70 for the year
1951; 71.4 per cent of it was from agricultural work and 9.8
per cent from industrial work, the remainder from sales, and
miscellaneous sources.
The proportional-profit farms are all producing sugar cane.
They might very well be used in the production of coffee,
tobacco, and pineapples. They might take over some large-scale
sugar plantations. Agregados should be helped to make much
better use of their lands for subsistence and even commercial
production. But looked at from the vast number of inade-
quate-sized farms, population pressure on the land, low incomes,
poverty, and ignorance, all of which are widespread in the Carib-
bean, the example of Puerto Rico should be challenging. Her
problems are still tough, but she is attacking them in an inte-
grated, statesmanlike, dynamic program of over-all land reform.
One who is long accustomed to observing and thinking in
terms of land situations and problems in the United States has to
shift the gears and even the focus of his thinking sharply if he
is to see clearly the land problems of the Caribbean countries.
In the United States we have from the beginning of settlement
always had a favorable land-population ratio. Family farm
ownership was easily accomplished over most of our country,
and because of this it planted and fed some of the substantial
roots of our democratic society. Land from the beginning was a
commercial commodity, and farming quickly became a business
enterprise in the hands of those who tilled the soil. During the
pioneering period of our development our population was built,
to a considerable extent, out of foreign immigrants, free men
seeking the individual or family ownership of farms. In the
Caribbean countries the additional people needed for economic

SOCIAL TRENDS

development were slaves. The ownership of the land was either
held by the crown or granted, in plantations, to large holders.
Democratic society was neither developed nor desired. The in-
fluences of these historical and economic facts are registered
indelibly in the situations which constitute the land problems of
these countries; they sharply condition the first practical step
in the solution of these problems.
There are differences in these problems, but there are also
some common denominators. All these countries have at one
time been colonies, their economies developed primarily to furnish
raw export products. None of them has therefore, until recently,
developed industrially. All of them have a high density of popu-
lation per square mile with consequent low per capital income
and high ratio of unemployment. These, together with high rates
of illiteracy, inadequate transportation systems, and inadequate
market outlets, not only condition their land situations but deter-
mine the feasible methods for attacking their land problems.
What I have attempted to do is to illustrate from three dif-
ferent countries three methods of attacking land problems. I
have done this in order to make some concrete contributions, but
also to point up the fact that historical, cultural, and even poli-
tical factors condition what can be and is being done.

*

Francis Violich: URBANIZATION IN
VENEZUELA -AN OBJECT LESSON
FOR THE CARIBBEAN AREA

MY VIEW of urbanization is that, while generally looked on
and described as a major problem of our time, it is actually one
of the great potentials toward human betterment in our hands
today. In this discussion I wish to examine what we mean by
urbanization, then to point out some of the problems it has
produced, and finally to demonstrate the opportunities and poten-
tialities which properly guided urbanization might bring about.
For this purpose I have chosen Venezuela as a case study in
which we may find experience significant for other countries in
the Caribbean in their adjustment to twentieth-century demands
and requirements.

I. What We Mean by Urbanization

First, what do we mean by urbanization? To take the purely
physical point of view, we can say it is simply the growth of
urban areas as against rural--the development of compact settle-
ments consisting of houses, work places, streets, roads, and related
facilities. But this definition is inadequate, for urbanization is not
a purely physical phenomenon: it can as well be described as a
social one--the formation of interrelated collective patterns of
social relationships for closer human and cultural interchange.
Likewise we might take the economic view of urbanization as an

	Cover
	Title Page
	Contributors
	Foreword
	Table of Contents
	Introduction
	Part I: Economic trends
	Part II: Social trends
	Part III: Literary and artistic...
	Part IV: Political and diplomatic...
	Part V: Peace and security...
	Index

MILLISECOND	CLASS.METHOD	MESSAGE
0	sobekcm_page_globals.constructor
0	sobekcm_page_globals.constructor	Application State validated or built
0	sobekcm_database.verify_item_lookup_object
0	sobekcm_page_globals.constructor	Navigation Object created from URI query string
0	sobekcm_database.verify_item_lookup_object
0	sobekcm_page_globals.display_item	Retrieving item or group information
0	sobekcm_page_globals.get_entire_collection_hierarchy	Retrieving hierarchy information
0	sobekcm_assistant.get_entire_collection_hierarchy
0	cached_data_manager.retrieve_item_aggregation
0	cached_data_manager.retrieve_item_aggregation	Found item aggregation on local cache
0	item_aggregation_builder.get_item_aggregation	Found 'all' item aggregation in cache
0	system.web.ui.page.page_load (ufdc.page_load)
0	sobekcm_page_globals.constructor.on_page_load
0	html_echo_mainwriter.add_style_references	Adding style references to HTML
0	html_echo_mainwriter.add_text_to_page	Reading the text from the file and echoing back to the output stream
36	html_echo_mainwriter.add_text_to_page	Finished reading and writing the file