The Other West: Latin America from Invasion to Globalization 9780520947511

Table of contents :
Contents
Maps
Acknowledgments
Introduction: Latin America in World History
One. Entry
Two. The Ibero-American World
Three. Revival
Four. The Euro-American World
Five. Westernization
Conclusion. Historical Forms and Trends
Bibliography
Index

Citation preview

The Other West

T h e C a l i for n i a Wor l d H i stor y L i br a r y Edited by Edmund Burke III, Kenneth Pomeranz, and Patricia Seed 1. The Unending Frontier: Environmental History of the Early Modern World, by John F. Richards 2. Maps of Time: An Introduction to Big History, by David Christian 3. The Graves of Tarim: Genealogy and Mobility across the Indian Ocean, by Engseng Ho 4. Imperial Connections: India in the Indian Ocean Arena, 1860–1920, by Thomas R. Metcalf 5. Many Middle Passages: Forced Migration and the Making of the Modern World, edited by Emma Christopher, Cassandra Pybus, and Marcus Rediker 6. Domesticating the World: African Consumerism and the Genealogies of Globalization, by Jeremy Prestholdt 7. Servants of the Dynasty: Palace Women in World History, edited by Anne Walthall 8. Island World: A History of Hawai‘ i and the United States, by Gary Y. Okihiro 9. The Environment and World History, edited by Edmund Burke III and Kenneth Pomeranz 10. Pineapple Culture: A History of the Tropical and Temperate Zones, by Gary Y. Okihiro 11. The Pilgrim Art: Cultures of Porcelain in World History, by Robert Finlay 12. The Quest for the Lost Nation: Writing History in Germany and Japan in the American Century, by Sebastian Conrad; translated by Alan Nothnagle 13. The Eastern Mediterranean and the Making of Global Radicalism, 1860–1914, by Ilham Khuri-Makdisi 14. The Other West: Latin America from Invasion to Globalization, by Marcello Carmagnani 15. Mediterraneans: North Africa and Europe in an Age of Migration, c. 1800–1900, by Julia A. Clancy-Smith 16. History and the Testimony of Language, by Christopher Ehret 17. From the Indian Ocean to the Mediterranean: The Global Trade Networks of Armenian Merchants from New Julfs, by Sebouh David Aslanian 18. Berenike and the Ancient Maritime Spice Route, by Steven E. Sidebotham 19. The Haj to Utopia: The Ghadar Movement and Its Transnational Connections, 1905–1930, by Maia Ramnath

The Other West L at i n A m er ic a from I n va sion to Globa liz at ion

Marcello Carmagnani Translated by Rosanna M. Giammanco Frongia

University of California Press Berkeley

Los Angeles London

University of California Press, one of the most distinguished university presses in the United States, enriches lives around the world by advancing scholarship in the humanities, social sciences, and natural sciences. Its activities are supported by the UC Press Foundation and by philanthropic contributions from individuals and institutions. For more information, visit www.ucpress.edu. University of California Press Berkeley and Los Angeles, California University of California Press, Ltd. London, England © 2011 by The Regents of the University of California Library of Congress Cataloging-in-Publication Data Carmagnani, Marcello. [Altro Occidente. English] The other West : Latin America from invasion to globalization / Marcello Carmagnani ; translated by Rosanna M. Giammanco Frongia. p. cm. — (The California world history library ; 14) Includes bibliographical references and index. isbn 978-0-520-24798-7 (cloth) isbn 978-0-520-26749-7 (paper : alk. paper) 1. Latin America—History. 2. Latin America— Relations. 3. World history. 4. International relations— History. I. Title. f1410.c26913 2011 980— dc22 2009049781 Originally published as L’altro Occidente: l’America Latina dall’ invasione europea al nuovo millennio (Turin: Einaudi, 2003). Maps 1 and 4 are by Pedro Cunill Grau and appeared in Para una historia de América, 1: “Las estructuras” (Mexico City: El Colegio de México –Fideicomiso Historia de las Américas–Fondo de Cultura Económica, 1999). Manufactured in the United States of America 20 19 18 17 16 15 14 13 12 10 9 8 7 6 5 4 3 2 1

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This book is printed on Cascades Enviro 100, a 100% post consumer waste, recycled, de-inked fiber. FSC recycled certified and processed chlorine free. It is acid free, Ecologo certified, and manufactured by BioGas energy.

The publisher gratefully acknowledges the generous support of the Valerie Barth and Peter Booth Wiley Endowment Fund in History of the University of California Press Foundation. The publisher also gratefully acknowledges the generous support of the Joan Palevsky Literature in Translation Endowment Fund of the University of California Press Foundation.

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C on t e n t s

L i s t of M a p s

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ix

Ac k n ow l e d g m e n t s / xi

I n t roduct ion

L at i n A m e r ic a i n Wor l d H i s t or y

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1

/ Entry / 14 The Invasion / 15 The Search for New Connections / 35 on e

/ The Ibero-American World / 52 The International Context / 53 The Components of the Ibero-American World / 60

t wo

t h r e e / Revival / 85 The International Context: Continuity and Discontinuity / 86 The New States Are Born / 101

/ The Euro-American World / 136 From European to International Concert / 137 Latin America in the International Order / 141 Latin America in the International Economy / 150 Toward a New Society / 167 The Liberal-Republican Political Order / 180

fou r

/ Westernization / 192 From International Disorder to the New Diplomacy / 193 Latin America in the International Economy / 221 The Secularization of Society / 243 The Westernization of Politics / 253 five

Conclusion

Historical Forms and Trends

B i b l io g r a p h y

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I n de x

301

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285

/ 273

M a ps

1. 2. 3. 4. 5. 6. 7.

The New American Space ca. 1650 / 40–41 Ibero-American Commercial Axes / 69 U.S. Sphere of Influence, ca. 1900 / 143 Transformation of the Latin American Space / 151 International Migrations, 1815–1914 / 169 The System of International Alliances, 1945–1990 / 215 Principal Latin American Urban Centers, 1990 / 251

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Ac k n ow l e d g m e n t s

My inquisitiveness was stimulated by exchanges with fellow historians but also anthropologists, economists, and political scientists at university symposia and seminars in Italy, Europe, the United States, and Latin America. Special thanks go to my students at the University of Turin and El Colegio de México who prodded me to reflect on internationalization and globalization. Many colleagues have enriched my research; Herbert S. Klein, Alberto Gallo, and Manuel Miño are among the many. I dedicate this book to my wife, Alicia Hernández Chávez, and my daughters, Paola and Elena, who stimulated my ideas, offered constructive criticism and suggestions—Alicia in particular—and encouraged me to complete this work.

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I n t roduct ion

Latin America in World History

This book aims to highlight the role, past and present, of Latin American countries in world history. I believe that historical analysis can lead to insights useful in understanding how, when, and why Latin American regions participated in various worldwide events and the role that each played in the vast network of collaborative relationships and institutions, formal and informal, that exists both on the Latin American subcontinent and between it and the rest of the world. History helps us to understand past and current events by identifying the forces that either stimulated or hindered the role of various countries in global change; historical analysis forces us to go beyond the narrative of facts and events to uncover the ideological bias in different interpretations of such events. Once history has been freed of the restriction imposed by the social sciences to study only the past, the voices of the world—and of the American subcontinent in particular, whose voice has been muffled in recent decades by the rhetoric of exoticism, oral history, and memory—will emerge (Mazlish in Mazlish and Buultjens 1993: 113–20). The recurring patterns of Latin America’s participation in world history illuminate its relationship with the rest of the world. Focus on these interconnections reveals the processes of cooperation and give and take, forming a picture of national and international events that situates the subcontinent within the world system. 1

Here I will sketch the gradual evolution of these forms of cooperation, conflict, and mediation with the other regions of the world. In the conclusion I will identify the historical patterns of Latin America’s participation in the world system. This book is neither a historical synthesis nor a history by area or subject. Its approach rests on the premise that Latin America has an integral role in world history, and that therefore its evolution is best understood by comparing and contrasting it with the world at large. T h e Engi n es of Wor l d H istory

I consider the economic, social, political, juridical, and cultural interconnections between Latin America and the rest of the world the engines that have driven various forms of participation, continually reorienting and shaping them to historical circumstances. I have traced five centuries of these unfolding interconnections and in the process identified their changing patterns that led over time to new, reciprocal relationships. Some of these interconnections are formal, some informal. The formal connections involve institutions, such as the administrative bodies of the Spanish and Portuguese monarchies in the colonial age or, later, of the sovereign Latin American nations, as mandated by their nineteenth-century constitutions, both monarchic and republican. Informal interconnections tend to be the organic responses of local subjects, shaped by the unique history of each area or reactions to institutional vacuums, especially in the law. The latter connections were especially strong in periods of change, such as during the wars of independence (1808–25) or the revolutions of Mexico (1911–17) and Bolivia (1952–56). Everyday life saw a constant interplay of institutional solutions—juridical ones in particular—with local customs and common law, with a view to generating or widening consensus and mitigating conflict. Making this thicket of relationships still more complex was the constant adaptation of norms and practices to old and new patterns of reciprocity and associationism—for example, brotherhoods and mutual aid societies—that are still strong in Latin America, especially in rural areas. Starting in the sixteenth century, interconnections gradually developed both among the Latin American settlements and with communities in North America, Europe, Africa, and Asia. Studying each historical period highlights the growth and increasing complexity of these interconnections—which took on a dynamic, fluid quality—while also allowing us to compare local contexts to international ones. Exploring these international relations and evaluating their reach, perme2

Introduction

ability, boundaries, and critical nodes is one way of overcoming a narrow approach that is popular in studies of Latin America, one that puts too much emphasis on national conditioning factors. This type of nation-centered analysis and its variants, in regard to both the subcontinent and elsewhere, overlook the commonality of interests and issues that binds people all over the earth and the parallel, simultaneous, or converging features of historical processes. This serious flaw also mars the study of specific Latin American communities because it omits factors that have identified Ibero-America historically. Those who try to identify a shared past by arguing that the history of a country must be sought in the influence of religion, a common language, or the proximity to an indigenous culture forget that the building blocks of any shared history are found in the interplay among subjects of diverse nationalities and the network of relations that they manage to build between them. Of course, this does not mean that a history shared by many states and nations develops in the same way for all or leads to a common destiny. By “shared history” I simply mean that in any given epoch, different countries react to similar challenges—be they ecological, economic, social, political, cultural, or technological—by drawing on experiences that are known or that recur everywhere. These shared experiences enable communication, building social patterns and relations within nations and among them. With these premises in mind, I approach the history of Latin American society from a differentiated, not unitary, perspective, seeing it as both a society open to the world and part of a shared hemisphere. By identifying the communication channels that crisscross Latin America and the common histories that unite it, we are able to reconstruct its history from the double perspective of the hemisphere and the world. A hemisphere-centered history can illuminate the meaning, the how and the when of Latin Americans’ efforts to push beyond their natural frontiers, their local or national habitat, to make contact with other areas of the subcontinent. A global perspective sheds light on the how, the when, and the why of relations between the subcontinent and the rest of the world. For example, in addition to the slave trade and the triangular commerce with Europe, the connection between America and Africa generated a rich history of cultural, social, and racial intermixing (Thornton 1998: 129–269). Similarly, a historical approach would look at present-day Latin American emigration as the result of many factors: the globalization process and the general rise in poverty; a new pluralism; and the complex interconnections that developed among the subcontinent, Europe, and North America enabling immigrants to hold dual citizenship (Gungwie in Mazlish and Buultjens 1993: 131–51). L at i n A m e r i c a i n w o r l d h i s t o r y

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By looking at Latin America in its global dimension, we vindicate the centrality of individuals as actors inside their community and recognize the importance of their actions. This view goes beyond a “world-system” interpretation such as Immanuel Wallerstein’s (1974–89), which focuses on the structures underlying human action and, like all structuralisms, assigns too little freedom to the individual or to family units, neglecting people’s natural, creative propensity to identify the connections that best suit them. A worldsystem approach underestimates a collectivity’s potential to develop its capabilities and local resources. The structuralists accord too much weight to the geographic and economic elements of the world order. Wallerstein, in particular, links the ability of a community to expand internationally to its being dominated by a highly structured system, one that exerts its own power of coercion over the earth. In such a system the position of each society, nation, social class, or individual, and its potential for evolution, is determined by the role that each plays in the international division of labor—a division begun under sixteenth-century capitalism. Inevitably, the resulting stratified international system rests on inequality and asymmetry and tends to be unmoved by history’s doings. According to Wallerstein, this world system forces its order on regions and countries: it selects a few to be exclusive system centers, granting only partial benefits to semiperipheral areas and allowing the peripheries (which constitute the great majority) to suffer. The unbending, one-dimensional, repetitive nature of the world system causes regions and countries to stagnate, their fate enforced by an abstract reality that resists any autonomous decisions by individuals or groups. From this reading of history, an ad hoc variant developed for Latin America: the “dependency theory,” which argues that since the subcontinent’s participation in world dynamics is passive, it never could, cannot now, nor will perhaps ever be able to affect the world’s destiny. In sum, in the past five hundred years the regions of the so-called Third World have played, at best, the role of subaltern, living on the margins of history or, rather, on the margins of the “great” history of industrialized nations (Frank 1967). To “redeem” those instances when the “subaltern” Latin American countries acted decisively to change their own history requires a new, careful reading of the interconnections that bind human collectivities. Only in that way will it be possible to understand how some subjects creatively strengthen their presence in the international system, exploiting advantages and minimizing negatives. In their everyday life these individuals and groups appear to be neither subordinated nor overwhelmed by weighty structures or external 4

Introduction

conditioning. In his novel The Man without Qualities, Robert Musil gave one interpretation of this mode of perception when he wrote, “If there is a sense of reality, and no one will doubt that it has its justification for existing, then there must also be something we can call a sense of possibility . . . [which] could be defined outright as the ability to conceive of everything there might be” as actually happening, as coming to be (pt. 1, §4). If we accept the premise that historical subjects exercise their free will and, by acting, transform reality, we must recognize this power in each human being, each collectivity, no matter how subaltern or marginal they might be considered. The old “traditional/modern” or “developed/underdeveloped” dichotomies prevent us from grasping the meaning and complexity of the transformations experienced by human societies in the past five millennia. If we break free of these dichotomies, we see that, as Jack Goldstone suggests, “throughout history, all societies have experienced periods of efflorescence, as well as extensive growth, stagnation, and crises” (2002: 333–34). The focus on interconnections and patterns of communication between the various regions of the world brings to light a fact that is incontrovertible, no matter how strongly the structuralists deny or dismiss it: all Latin American areas and their historical subjects can, without exception, act intelligently at all levels—local, national, and international; when they feel blocked or held back, historical subjects act as “free riders,” at the edge of norms and institutions (North 1981: 45–58). Dealing in contraband, for example, was a widespread Latin American reaction to the commercial monopoly enforced by the Iberian crown during the colonial era. Another typical “free rider” reaction was that of the laborers who, exploited by large estates or mines, left their villages to build new settlements and livelihoods in the wilderness. From this perspective the flourishing of international nongovernmental organizations such as Amnesty International may be seen as a reaction of private citizens, at the dawn of the twenty-first century, to the human, civil, and political rights violations perpetrated by authoritarian governments. Once we recognize each person’s potential to act in concert with others and to react to the challenges of her or his national or international context, we must also recognize his or her potential to transform the environment. Therefore, each human being and each collectivity possesses the knowledge and social capital needed to achieve national or international change, as well as to curb, disable, or mitigate processes of change (Clark 1997: 16–32). Human collectivities react differently to challenges, in ways that reflect their unique heritage: some countries, such as South Korea, Taiwan, Singapore, or modern China, ride the waves of change. Others are reluctant L at i n A m e r i c a i n w o r l d h i s t o r y

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or do not act fast enough to use change for their benefit, such as the Latin American countries still shackled to the statist-nationalist model. Yet in the early nineteenth century the opposite was true: the Latin American countries embraced the new constitutionalism, a republican form of government, liberalism, and the free market and intuitively understood the potential of international diplomacy, whereas Japan, China, and other Asian countries were reluctant to change. The unequal and different participation of each country in the international scene continuously affects world history; the process is not linear, since a country’s participation is neither constant nor progressive. Each country’s own history conditions its form of international participation, its stability, and its specific and general results. Therefore, world history moves asyntonically: nations and regions follow the world’s trends only when they so choose. It is true, in any case, that the great powers were not always the same countries. In the seventeenth century Spain was preeminent; in the eighteenth century, the Netherlands; and in the nineteenth, Great Britain. After reaching the apex of their power, nations start to lose ground, opening up space for new leaders (Kennedy 1987: 536–40). Predictions for the year 2050 see Brazil, Mexico, and China as the leading countries. Nor must lesser countries always fill a subordinate role. For example, Great Britain was a minor country for most of the modern age, from 1500 until 1800, when it became the world leader. Similarly, in the late Middle Ages the Italian city-states began to wane, leaving the stage to what would become the great sixteenth-century empires (Spain and Portugal); in turn, these lost power when the nation-states began to emerge. The Americas went through analogous changes: from the sixteenth to the eighteenth centuries, the leading dominions were the viceroyalties of New Spain (Mexico) and Peru; in the nineteenth century the leaders were Argentina, Brazil, and Chile. From the nineteenth to the twentieth centuries, especially beginning with the First World War, the United States would become the great international power, only to begin a decline at the turn of the twenty-first century. T h e I n t e r nat iona l S yst e m: R e l at i v e Au tonom y a n d For ms of Coope r at ion

The first step to a better understanding of the world-system’s changing geometry is to acknowledge the mechanism of interconnections between the different countries and regions of the world. In order to transcend the stereotypes and the deterministic analysis imposed by structuralism, we 6

Introduction

must recognize that historical processes are flexible, spontaneous, and unpredictable, and that collective action generates a multitude of mechanisms for interconnection, both material and immaterial. Such interconnections may be temporary or durable. To give an example of the first, both the Vikings and the Chinese set foot on American soil long before the Europeans, yet the Vikings failed to establish stable, long-lasting settlements on the shores of New England, and the Chinese failed to leave their mark on the American Pacific Coast at that time. The Europeans, on the other hand, though they came later, left an indelible imprint. It would seem, therefore, that world history retains the memory of, and favors, those ties that give rise to lasting, mutually beneficial interactions that in turn generate new connections. The different ways in which the world has been represented are visible clues to the benefits produced by long-term cooperation between historical subjects. On the world map of Blaeu’s Atlas Major, published in Amsterdam in 1662, the four known continents—Europe, Asia, America, and Africa— have identical proportions; none dominates for the simple reason that the divine principle governs them all from above, organizing the world and ensuring the cooperation of its different parts. Almost a century later, in 1753, a fresco on the ceiling of Ca’ Rezzonico, the palace of a leading Venice merchant, also represented the four continents as equal in size and equidistant from the center, where the Deity, the supreme power that organizes the world’s orderly cohabitation, dwells. Again, a balanced, orderly view of the world prevailed. But in Trieste, a Mediterranean port city open to the world, we find a secularized version of the universal organizing principle: the Four Continents Fountain (1751–54). This monument, located in the city’s main square— the center of its mercantile activity—features four statues, each representing a continent. The statues pour their waters into the main basin, an act that symbolizes cooperation and the common destiny of the continents. Also portrayed are the forms of this international exchange: each statue is decorated with an abundance of ships, nautical instruments, rigging, bales of cotton, and sacks of grain—the fruits and symbols of commerce, which organizes their exchange. At the center of the fountain rises the statue of Fame, a symbol of unity and the ultimate reference point for all the ties that bind human communities. In this allegory Fame and Commerce allude to a plurality of wills, both individual and collective, engaged in dialogue and participating in world affairs without renouncing their local and national specificities. L at i n A m e r i c a i n w o r l d h i s t o r y

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The symbolism of these conceptions of the world emphasizes competition and cooperation, the exchange between human communities within and between continents. These elements form the context in which world history develops, a history that can never be reduced to a mere aggregate of national histories. A world-historical perspective explains the causes and patterns of development of each region and country relative to the others. For example, the causes and circumstances that led China and Europe down diverging paths in the eighteenth century shed light on their different places in contemporary world history (Pomeranz 2000; Manning et al. 2002). Today it is clear why Europe, not China, became the wealthiest region in the world. The reasons were not just economic but political, for a comparison of their development in the eighteenth century shows that China was ruled mostly as an empire, whereas Europe was organized into several nation-states that occupied a compact territory. These factors led the European states to compete and exchange experiences (Vries 2002). Thus, a world-historical perspective leads not only beyond the narrow paths traced by the distinct national histories but also beyond the notion of a preeminence of Europe, fraught with Eurocentric claims about the universality of its culture. To insist on the importance of cooperation between the regions and countries of the world is not to dismiss the impact of conflict, war, disputes, delay, and progress, for these too further establish the organic nature of the interaction between domestic purpose and global scope. Focus on interaction, as the very subject of world history, acknowledges the importance of relations between states but frames them in a broader perspective that restores the role of each national, regional, and local player on the world stage, be these players immigrants, multinational corporations, banks and financial systems, humanitarian associations, or nongovernmental organizations. World history is neither simply an extension of the history of international relations nor a new label to be pasted on the old universal history. World history has its own unique dimension, rooted in the idea that the national and the international spheres have only relative degrees of autonomy and thus are forced to live together, a condition that promotes mutual cooperation. At what point in time, then, do we start investigating the relative autonomy of the international dimension? Certainly from the time that the balance of power among nations (the founding principle of international cohabitation) was first affirmed at the Congress of Westphalia (1645) and in the subsequent treaties of Utrecht, Rastaf, and Baden (1713–14), when the need to carve out a system to prevent one power from dominating the others became paramount. 8

Introduction

The concept of the balance of power among nations gained momentum concurrent with the new concept of the law of nations, which distinguished between natural law (that common to all peoples) and laws that govern relations between human communities. The law of nations trumps international law as well as the idea of Christian unity inherited from the Middle Ages. With its power to regulate the actions of political entities and, more generally, the actions of sovereign states, the new concept of international law promoted the resolution of interstate conflict while strengthening the relative autonomy of the international sphere. This process by which the international sphere gradually acquired autonomy accelerated in the nineteenth century with the rise of the new American and European states and in the twentieth with the creation of the new African, Middle Eastern, and Far Eastern nations. The birth of multilateral diplomacy, which became more visible as international organizations expanded, has reinforced and continues to reinforce the autonomy of the international order. The new global economy further consolidates this autonomy by incorporating informal institutions, such as business communities and capital markets, with formal ones such as the World Bank, the International Monetary Fund, or the World Trade Organization. The relative autonomy of the international dimension results from the interaction of many human activities—political and diplomatic, cultural and economic. A network of codified and uncodified rules is built that governs cooperation between nations, and between them and international organizations, and helps resolve interstate conflicts. Thus this stronger, more autonomous, international dimension is the outcome of a historical process driven by the will of individuals to express themselves collectively and thereby promote regular interaction between the national and the international spheres. The first scholar to introduce the concept of an international system arising from the multiple interactions between national and international spheres was Karl Polanyi (1944), by all accounts one of the founders of the world-historical school. Polanyi’s work lays bare the insufficiency of either a purely economic or cultural interpretation of world history. Like the “world system,” an economic approach leads to a deterministic, reductive vision of the international system. Similarly, culturalism, or postmodernism, offers an ultimately superficial interpretation. By insisting on perceptions, representations, and imagination, it overlooks the fact that, like all human manifestations, historical phenomena have their own intrinsic historicity, one distinct from all possible representations, however related to them. L at i n A m e r i c a i n w o r l d h i s t o r y

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Con t en ts a n d St ruct u r e of T h is Wor k

Based on these reflections, I have organized this book in five chapters that describe the changing patterns of cooperation and conflict between the Latin American regions and the world. In each chapter I illustrate the connections that made possible the convergences or divergences of the American and the European worlds, in an effort to reconstruct their underlying logic. In the final chapter I present the salient features of Latin American participation in the international system. I have drawn on historical studies as well as the social sciences, since by its very nature world history requires a multidisciplinary approach. The first chapter, “Entry,” considers the discovery and conquest of Latin America and the Caribbean—the American subcontinent—and, in particular, the types of organizations that arose in the New World from the clash and the meeting of two communities—Iberian and American Indian—with vastly different heritages. Traditional histories view the conquest, from 1492 to 1570, as a first phase, followed by a long colonization phase extending from 1570 to independence. I adopt a different time frame, treating the conquest (1492–1570) and the first colonization period (1570–1630) together, precisely to highlight how interethnic cooperation promoted the earliest patterns of the subcontinent’s participation in international historical processes. Analyzing these two periods together sheds proper light on the process that introduced the Latin American regions into the world scene. It shows how natives and American Spaniards drew on European resources to conquer the adverse conditions they faced in the first half of the sixteenth century—the demographic catastrophe foremost among them. As a result, in the period from 1600 to 1630 the New World began to take shape in ways that were different from how the cities of Spain and Portugal or the native Indian tribal and state organizations evolved. The entry of Latin America in world history was achieved by reworking, on American soil, Iberian and Indian traditions, creating a new form of interethnic cohabitation—one that was not, however, free of conflict. Local and regional individuals and entities helped set in motion the interactive processes that connected them with the international subjects of the time, such as Iberian and other merchants, officials from the Iberian Peninsula, the Catholic Church, the Iberian monarchies, and the royal institutions. Chapter 2, “The Ibero-American World,” describes the gradual building of the New World from about 1630 to about 1750. In this period the

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Introduction

many connections active inside and outside the subcontinent were consolidated, defined, and redefined. Marked by a new mode of participation by the subcontinent in world events, the connections between the various Ibero-American components multiplied and grew in complexity as a result of mixed-race unions; at the same time contacts between Americans and Iberians and other communities expanded and intensified. Chapter 2 offers a picture of the dynamism and creativity typical of the Ibero-American world, too often wrongly described as static. In this period individuals worked out complex strategies to overcome the colonial restrictions and expand their autonomy, successfully exploiting to their own advantage the loyalty that bound them to the monarchs and the Catholic Church. Exploring the connections between the subcontinent and the world brings into focus the importance of the political decisions that Iberians and IberoAmericans made in the seventeenth and eighteenth centuries. The forms of self-government developed by the Indians and the settlers shed precious light on the local mechanisms devised to counter the absolutist tendencies of the Spanish and Portuguese monarchies. Chapters 2 and 3 treat the relative autonomy of the Latin American colonies and their formal and informal links to Europe. Here I argue that both Americans and non-Americans used their ability, knowledge, and available resources to creatively adapt to the opportunities and risks that characterized their relationship with Spain, Portugal, and the rest of Europe. Had this not been the case, it would be impossible to understand the historical process that, from about 1750 to 1830, made the subcontinent part of the international order. In fact, the European order restored at the Congress of Vienna (1814) had to take into account the new sovereign states born of the revolutions in England’s American colonies and in Latin America. In chapter 3, “Revival,” I analyze the decisions of the Latin American world to join the international system and the forms of that participation. I also reiterate the need to overcome a national history approach that presents the different countries as victims of constant external threats. The real problem lies in showing how the new nations, which insisted that they were sovereign states entitled to formal diplomatic treatment, tried to establish new relations with the European states and the United States. Chapter 4, “The Euro-American World,” covers the internationalization process that took place from the 1850s to about the 1930s. It looks in particular at how the subcontinent reacted to the challenges that arose in that period: a transformed international trade, the second industrial revolution,

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the new European and U.S. colonialism, and the need to bolster the defense of their national borders. Exploiting the potential benefits of the new order, Latin American countries also gradually developed policies to contain the negative fallout from their international relations. In this analysis of Euro-American relations, the nation-state becomes central, especially its ability to project itself onto the world stage as an international player. I also explore how the various governments tried to control their territory and the measures they took to promote the assimilation of their many ethnic and racial groups into a community founded on common interests, one that could give rise to a nation-state with an international presence. In this sense the history of the Latin American countries is like that of other nations in the same period that launched themselves on the international scene, initiating a process fraught with new risks and challenges, not just for individuals and entities but also for governments. Chapter 5, “Westernization,” retraces the path that led to the definitive Westernization of Latin America. The interpretive approaches and findings of various disciplines contribute to the formation of several reliable theories about a historical process that began almost a century ago and has not yet run its course. This chapter focuses on some important trends first identified in the 1930s, such as the strengthening of the nation-state as a result of its increased capacity to block negative international factors. This pitting of the nation-state against the international sphere would have severe repercussions for domestic and international peace. Since the 1970s a trend has emerged with a multiplicity of new players on the national and world scene who, regardless of their national origin, influence transnational decisions. Networks linking national and international realities have developed through financial brokering, the growth of nongovernmental organizations, and stronger international public opinion. In large measure this process is one outcome of immigration and new forms of communication, as well as of the “no global” movements, whose proponents claim the autonomy of their respective countries of origin. Much of the last chapter analyzes Latin America’s participation in the globalization process—not an easy task, given the widely divergent points of view held by supporters of globalization and its critics. Attempting to overcome this rift, I ask whether globalization should indeed be treated as a resurgence of the internationalization process that was blocked—or interrupted—by the chaos of two world wars, or whether it constitutes a new mode of entry into the world system for Latin America. In the conclusion I discuss Latin America’s insertion into world history, 12

Introduction

which was characterized by the interaction of communities on the subcontinent with communities in the rest of the world, relationships that multiplied and differentiated over time. Thus, the internationalization of the Latin American areas grew from the determination of individuals to reinforce their actions by assimilating and developing a rich variety of material and cultural resources.

L at i n A m e r i c a i n w o r l d h i s t o r y

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America’s entry into the Western world is the result of a process whose first phase, from the discovery by Christopher Columbus in 1492 to about 1570, when much of the continent had been transformed into an Iberian territory, entailed the violent destruction of the many native American civilizations and peoples. A longer view, however—from the discovery through the first colonization in the early seventeenth century—shows that precisely because the Amerindian populations declined so rapidly, both natives and Iberians were practically forced to build novel forms of cooperation. As the conquistadors were conquered by a plurality of Amerindian forms, the conquered Amerindians began a process of creative reconstruction that would slowly bring them culturally closer to the Iberians. In describing how Latin America became Westernized, starting with its discovery by Europe, it is important to note the twofold process of an initial collision between Iberians and Indians in the sixteenth century followed by the cooperation that would define the central phase of colonization, from about 1630 to about 1750. Still, even the collision phase saw trial and experimentation as both groups could not change their historical and cultural reference points quickly enough to accommodate their new reality, one whose outcome was still uncertain, since in the early sixteenth century Iberians and American Indians were only potentially conquerors (conquistadores) and conquered. 14

Although today we regard Europe and the Americas as groups of nations that also have a continental history, not only geographically but especially culturally, throughout the sixteenth and the early seventeenth centuries Amerindians and Iberians had essentially a local vision of their history and culture that offered no framework for interpreting their new experiences. During the phases of clash and cooperation that marked the entry of the Latin American territories into Western history, Spaniards, Portuguese, and Amerindians gradually began to perceive the links between the different areas of the New World and between the New World and the Iberian regions from which the conquistadors had come. Because the European invasion was not simply a matter of arms but also entailed the use of cultural and organizational resources by both parties, I will begin by reviewing the situations of both groups at the time of the conquest, trying to identify what connections might have existed between those who would become the conquered and the conquerors. Because spontaneity is a distinctive trait of conflict and cooperation alike, annexing the Americas to the Spanish and Portuguese monarchies was no simple undertaking, and its success was in no way inevitable. In fact, in the period from about 1570 to 1600, a number of contrasting trends emerged: the feudal conquistadors and their offspring existed side by side with Iberiantype municipal councils; the latter enjoyed royal privileges and thus came into conflict both with the seigniorial expectations of the conquistadors and with the monarchy. At the same time the native Indian structures continued to fill an important role in many colonized areas, and the perseverance of the native lords and the native Indian nobility helped to mitigate the millennialist longing for a return to a pre-Hispanic life that would otherwise have led the natives to revolt. Thus the royal officials did not find the West Indies easy to manage, either politically or economically. During the invasion and the early phase of colonization, the Europeans established new modes of interaction to ensure that the New World would continue to remain part of the Iberian monarchies.

T h e I n va sion

The American Indians Before the Spanish and Portuguese invaded and conquered the Americas, the various native societies had a history of almost forty thousand years, starting with the migration of Asiatic peoples who had reached the continent by T h e I n va s i o n

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crossing the Bering Strait as well as those who had come by sea from Oceania. As the continent that was the last to know the presence of humans, and the only one whose cultures evolved without any contact with Europe or Asia until the arrival of Europeans in 1492, America (or the Americas, since they are technically two continents on one landmass) is unique. Throughout its prehistory America was marked by the presence of highly diverse populations with different cultures that had little communication; there was also little exchange between the north, center, and south. This diversity is not a negligible factor: because of it, the Europeans, starting with Christopher Columbus, were able to invade the continent between 1492 and 1570. It is important to remember the great differences in language, environment, economy, culture, and even organization of the native peoples, lest we forget that the so-called “Indian” identity was an Iberian construct that lumped together and unified the highly heterogeneous native populations. These groups included nomadic, seminomadic, and sedentary populations. One feature that distinguished the various Indian societies was the cultivation of plants and the domestication of a few animals. From about 5,000 to 3,000 b.c. the Americas underwent a neolithic revolution similar to that which occurred on other continents; as a result some societies moved to an agricultural phase and developed specific practices of diet and culture that still partly exist today in Latin America. The cultivation of maize, potato, cassava, chili pepper, quinoa, beans, pumpkin, and avocado, as well as the domestication of the dog, turkey, llama, and guinea pig, characterized Mesoamerica (Mexico and Central America); cassava and sweet potato, the Caribbean, or the Tropics; and potatoes and the llama, the Andes (from Ecuador to northern Argentina). The advent of agriculture was not only a material event but a cultural one. It led to the transition from roving hunter-gatherer groups of no more than 150 to 200 individuals, following a leader and a shaman, to tribal organizations of gatherer-hunters who farmed, had a stable base—the village, which was also their ceremonial center—and developed a complex political and religious structure. This transformation took at least two millennia, with the transition from farming tribes to settled farmers occurring about 3000 to 2500 b.c. Starting in about 200 b.c., the great Aztec, Maya, Chibcha, and Inca civilizations arose from these seigniories (city-states ruled by a monarch or lord), or princedoms. This anthropological sketch shows that all native Indian organizations, from the hunter-gatherer clans to the more culturally evolved societies, were 16

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extremely complex and dynamic and that the evolution experienced by only some of them was not due to greater skills or mental capabilities. Like the transformations in ancient European societies, this evolution grew out of choices dictated by opportunity and need. These choices are expressed, for example, in the language of each culture, since language reflects the system of categories and the structure that the human builds in relation to objects and beings. It follows that no language is elementary because, as Jacques Soustelle paradoxically comments, “of the American Indians I met, the less civilized, the more complex they are” (Soustelle 1967). Although they were equally endowed with the potential to evolve, not all Amerindian societies made the transition from clans to tribal organizations and from tribes to states. The Mesoamerican and Andean civilizations became great not just because of the opportunities afforded by demographic growth, technological advances (irrigation, roads, silos, etc.), bartering of goods, or the need to manage resources but also through the development of a collective imagination, as evidenced in the calendar and the elaborate religious and political hierarchies. All this led to the birth of complex state organizations ruled from architecturally sophisticated cities, still visible in the ruins of Teotihuacán, Chichén Itzá, Tikal, and Cuzco. A clearer idea of the cultural diversity that existed when the Europeans arrived on the American scene emerges by correlating the (estimated) population of the different regions and the prevailing type of organization. Although the available information is fragmentary, it is possible to estimate that at the end of the fifteenth century half of the natives lived in complex state organizations and about three-fourths had lived through the neolithic revolution. Before the arrival of Europeans, America was already a complex and dynamic world; the idea that it was static took hold after the conquest for political and ideological reasons (just as ideological is the current idea that, unlike those of Europe, native American societies were harmonious and egalitarian). Precisely because they were dynamic, both clan-based and state-based organizations had to forge systems of social discipline, a clue to the high degree of tension and conflict that marked all American Indian societies. Hunter-gatherer clans were organized around the extended family, with matrilocal residence, and were always on the move over a vast territory in search of food, carrying with them their bows, arrows, nets, provisions, and the skins of captured animals. The last were the principal barter goods and also served to reinforce lineage bonds, as the skins were distributed to the women, who would make garments out of them. The extended family was also the basic unit of tribal societies, with the T h e I n va s i o n

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village frequently inhabited by two or more lineages, for farming reasons and for the greater hunting and food-gathering resources that the arrangement produced. Thanks to these more abundant resources, the elders were gradually exempted from work, for age raised one’s social status and prestige and was to become the basis of the shaman-chief’s authority within the tribe. In addition to these two types of organization, at the time of the conquest America had two empires—the Aztec and the Inca—and each in turn subsumed numerous city-states. City-states also existed in Central America, Colombia, Venezuela, Ecuador, northern Chile, northwestern Argentina, and in some parts of the Amazon. All these organizations were the result of a chain of internal transformations, migrations, and intercultural contacts that left their mark in art, astronomy, mathematics, architecture, and engineering. By virtue of long experience and many trials and errors, empires and city-states efficiently managed their diverse environments. They successfully governed large populations through numerous complex systems of discipline and hierarchy that gave different degrees of access to community goods and services. Unlike clans and tribes, empires and city-states were able to withstand the collision with the Europeans precisely because they had reinforced the clanbased structures that were common on the subcontinent. Two clan-based organizations were particularly important: the calpulli, which was typical of Mesoamerica, and the ayllu, which was widespread in the Andes. Both still exist today in many regions of Mexico, Colombia, Ecuador, Peru, and Bolivia. As I have noted, the neolithic revolution gave rise to farming villages that facilitated the shared use of a territory by two or more extended families. In addition to an economic and social function, the Mesoamerican version of this clan system—the calpulli—also filled a political and cultural need because it grouped together several extended and nuclear families that were related to each other, on condition that they all recognize the same divinity as the protector of the entire clan. This homage was for the divinity that had taught the calpulli members a trade, craft, or skill useful to the clan as a whole and meant to be passed down to the next generation. The religious foundation of the calpulli helps explain why the clan owned all local resources, including land and water. Clan authorities assigned the calpulli members their plots of land and the amount of water they needed to irrigate it. The authorities also managed the village’s unassigned land, whose crops supported the nobility, the priestly class, and the lord or emperor. The mechanism for allocating resources to the emperor, lords, and officials was 18

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the tribute, an institution that predated the Aztec Empire, undoubtedly born in the final stage of the population’s transition to sedentary life with the concurrent rise of a network of villages linked by barter. The calpulli was at once the foundation of the material and spiritual life of the village and its members, and the first level in the vast seigniorial (and later imperial) political organization. The Andean ayllu had the same dual significance as the calpulli; however, the ayllu put more importance on the role of the territory. The ayllu was a grouping of families believed to originate from a common ancestor in a specific geographic location. Before they began conquering the many Andean seigniories in the second half of the fifteenth century, even the Inca were no more than a territorial seigniory comprising eleven ayllu near Cuzco, in the southern Andes. The ayllu’s religious reference point was the ceque, an imaginary line linking the ayllu to a sacred place. The close link between religion and society was thus a common trait of Amerindian societies. In Mayan and Aztec Mesoamerica this link was manifest in the idea that humans are merely the expression of a twofold divine will, one ruling the upper region—heaven—and the other ruling the lower—Earth. The Andean conception of the world was similar, for they believed that the interaction of the material and the spiritual world informed the principles of Inca society: tripartition, dualism, and the imperial tithe. Tripartition establishes the relation of sacred and secular points, the latter visible in the territorial division into districts. Dualism sanctions the idea of the integration of unequal parts of an ayllu through exogamous marriage. Finally, the tithe defines the political-administrative structure of the empire, especially the tribute system. Thus Amerindian societies are anything but simple to describe or to understand. It is true, however, that the closer they were to an imperial-type organization, the more stratified they became. The result was an entrenched reverential fear of one’s superiors—the elder, calpulli chief, local priest, merchant, warrior, and, obviously, the lord or dynastic ruler. The lord (tlatoani in central Mexico, batab in the Yucatán, kuraka in the Andes), called cacique by the Iberian conquistadors, was the end result of a cultural, political, and social process begun several millennia before the European invasion. Therefore a stratified structure was the distinctive trait of Amerindian societies, visible in the distinction between nobility and plebeians and in the different ranks within these. As I have noted, this strong regimentation was rooted in the belief that the divinity alone is eternal, while humans, and even nature, are extremely fragile. T h e I n va s i o n

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Although a stratified society made possible significant changes in production and better management of the resources needed to support a growing population, it also led to strain and conflict. Entire ethnic groups were wiped out for rebelling against the emperors, thousands were subjected to forced migration, and infighting erupted to replace lords. Various forms of temporary slavery, as well as human sacrifice, were especially widespread in the Aztec Empire, testifying to the tension between conflict and cohabitation that marked Amerindian societies, just as it did societies worldwide. The perennial state of conflict in which the nobility and the plebeians lived became crucial at the time of the conquest, because it fostered alliances and ententes with the invaders. In Mexico an Indian lord—a Zapotec from the Oaxaca region—proposed an alliance with Hernán Cortés for the purpose of subduing a powerful Mixtec seigniory. And because of an alliance between the Spanish invaders and the Tlaxcaltec people, Cortés was able to storm Tenochtitlán, the capital of the Aztec Empire. Similarly, when the meager Spanish expedition led by Francisco Pizarro and Diego de Almagro set foot in Inca territory in 1532, the Spaniards adroitly exploited the complex political game between Atahualpa and Huáscar for succession to the throne of Emperor Huayna Capac, who had died in 1527. Such ententes were more numerous than one might think. One telling example came in 1561, when the lords of Hatun Xauxa, in the Peruvian altiplano, demanded that the Spanish authorities return the goods delivered to Pizarro in accordance with the alliance the lords had formed with him to subdue Atahualpa in Cajamarca. Conflicts within Amerindian groups also led the conquistadors to try to forge alliances with the tribal chiefs. Because of these ententes, the French and the Portuguese were able to settle in Brazil, where Portugal’s alliance with the Tupinamba enabled it to defeat the French. The colonization of Chile and the founding of Santiago de Chile were made possible by an agreement that the conquering captain Pedro de Valdivia reached with the local chieftain. The fact that the natives possessed skills and capabilities enabling them to work out strategies as complex as those of the European invaders sheds light on the plurality of forms that European penetration was to take in the Americas. This plurality can be seen in the natives’ acceptance of a coexistence with the Iberians and, conversely, the Iberians’ need to constantly adapt to the different realities into which they had plunged. Ultimately, the invasion and conquest of the Americas represented not only the violent destruction of a world but also the creation of a new reality through the intertwining of two different worlds, not necessarily on an equal footing. 20

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The Iberians The cultural background of the Iberian invaders, for whom religion was the foundation of political and social action, played a primary role in the interactions between the conquered and the conquerors. Embodying their worldview was the idea of a res publica christiana, with throne and altar united, coexisting with the linguistic, cultural, political, and social specificities of the empire’s various realms. It is significant that the Iberian invasion took place under Holy Roman Emperor Charles V, in many ways the archetype of the transition from the medieval to the modern monarchy. If the native Indians were not the savage barbarians destined to be brought to the true faith by the Spaniards and the Portuguese, as depicted in sixteenthcentury Catholic chronicles, neither were the invaders the coarse, uncouth, obscurantist, and superstitious men depicted by anti-Spanish publications in the same period. Both images are oversimplifications that focus on the violence and abuses of the invaders, which, though certainly grave and numerous, should not obscure the many instances of coexistence between Iberians and Indians. Both the invaders with their captains and the native masses with their lords and noblemen had a wealth of cultural resources on which they drew, once the initial shock had passed, to work out strategies of adaptation and develop mechanisms that would generate new codes of behavior and patterns of social life. Most of the Iberians who came to the New World were natives of Castile and southern Portugal, among the most dynamic and densely populated regions of the peninsula. They tended not to be peasants but rather city dwellers, most of whom could read and write. Some captains, such as Hernán Cortés and Pedro de Valdivia, and almost all the Portuguese donatários (recipients of the king’s largesse) in Brazil were well educated men of Renaissance culture. The Iberian invaders—the conquistadors—were a small number indeed: in the sixteenth century fewer than 100,000 Iberians set foot in America, three quarters of them from Castile and the rest from Portugal. Between 1506 and 1560 only 1,588 Iberians arrived each year, a minuscule number compared to the total Indian population of about sixty million at the time of the conquest (dwindling to perhaps less than half that number in the last third of the sixteenth century). Who were those few thousand Iberians? What were their cultural traditions and their ways of thought, and how did they define themselves visà-vis the natives? Too little is known about them, except in the case of the T h e I n va s i o n

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royal officials and the churchmen. The former, who came late on the scene, had studied law at the universities; the latter, never numerous enough for their task of evangelization, had studied in the special colleges founded by their various orders. Apart from that, the only relatively reliable fact is that most conquistadors tended to call themselves hidalgos (Spanish) or fidalgos (Portuguese), which meant that they had some inherited social distinction that exempted them from the personal tax. This title gives some indication of the cultural tools that enabled the Iberians to carry out their enterprise in spite of their apparent disadvantage compared to the natives in terms of both numbers and organization. Recent studies note a significant increase under Isabella the Catholic in the naming of hidalgos and knights, ranks exempt from tribute, in response to the political and military situation and the conquest of Granada, the last Arab outpost. As a result, the lower nobility constituted, at the time of the discovery of America, at least one-tenth of all Castilian families—a far greater number than in previous periods. Still, the expansion did not affect the number of Castilian families at the upper end of the aristocracy, which remained at about one hundred, the same number that existed at the end of the fourteenth century. The large increase in the ranks of the lesser nobility cannot be dissociated from the importance that Castile took on as it reconquered the Iberian regions held by the Arabs since the first half of the eighth century (711–50). With the culmination of the centuries-long process of reconquest in 1489, and with the union of the crowns of Castile and Aragon, the hidalgos could no longer gain honors, wealth, and prestige in service to the king at home. Thus the reconquest gave way to the conquest, as the hidalgos left Spain for the New World. The conception of nobility inherent in hidalguía was rooted in medieval chivalry, but this form of honor was increasingly linked to prestige as new importance was given to family wealth. Hence, the political and social culture of the lower nobility experienced a renewal, because other social groups that served the crown, whether administrators or members of the merchant class, could now use their wealth to rise into the aristocracy through marriage, friendship, or clientelism. The spread of the culture of nobility led to a relative reduction of the warrior class of nobles as it extended nobility to social groups with wealth but no noble lineage. In the American context the concept of nobility is apparent in the conquistadors’ ability to elevate their social status by serving the crown and the Church. The reports to the king enumerate the services they performed, for 22

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which they reaped rewards similar to those their predecessors in Spain and Portugal had earned by fighting the Arabs. The Portuguese donatários were those rewarded with royal donations (donatarias) of vast regions in Brazil, while the Spanish conquistadors and their descendants received encomiendas entitling them to the tribute that the Indian villages were forced to pay the king. The royal donations, grants, and rewards to the new magnates were not just a Portuguese or Spanish phenomenon. This was a custom of the European monarchies in the sixteenth century. Only in the next two centuries would the centralization of politics and administration in the hands of the king and his officials put a stop to these rewards. When the invasion of the Americas began, the European monarchies still retained vestiges of the medieval parliamentary monarchy, such as the convocation of the estates and of the city representatives to the Cortes (parliaments) of Castile and Portugal and the presence of the high nobility in the royal councils. Castile and Portugal were unique for having such a large noble class, one left with no possibility of further improvement following the reconquest of the Arab-occupied lands. When the count-duke of Olivares, who was prime minister to the king of Spain, tried in the early seventeenth century to implement reforms to stem the decline of the monarchy, he came up with an interesting classification for the Castilian nobility, designating them as infantes (the king’s children), grandees, lords, knights, and hidalgos. The first three, he wrote, were expected to serve the Catholic kings in managing the kingdom and the empire and thus had to spend part of their income to maintain their royal offices. Members of the fourth category, the knights who dominated local politics by occupying municipal posts, were required to serve in the military. As to the hidalgos, the count-duke made a distinction that sheds light on the character of the conquistadors. He divided them into subclasses: the solariegos, who had some financial standing as property owners; the privileged hidalgos, who had acquired their hidalguía through a royal donation; and those who had neither property nor titles but were considered hidalgos by popular acclamation. A final group enjoyed hidalgo privileges only in their place of residence. With these distinctions in mind, it appears from the biographical information available, the firsthand accounts of the conquistadors, and our knowledge of the earliest Spanish and Portuguese inhabitants of the Americas that most of the conquistadors belonged to these last two groups: they were hidalgos only in their place of residence or were popularly known as such, and had left home to seek fortune, first in the imperial armies and later in the Americas. T h e I n va s i o n

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The Iberians had a multicultural background, as they came from areas with a strong Arab and Jewish presence. Seville and Lisbon, in particular, also had a large population of African slaves. Might this background have aided them to some extent in dealing with other racial and ethnic groups? Also significant is the fact that when the Catholic kings left Granada, they entrusted the government of the reconquered region to a triumvirate that included Hernando de Talavera, the first archbishop of Granada, who advocated tolerance and openness toward Muslim culture and religion. One experience that affected the hidalgo class that reached the American shores was the Castilian and Portuguese expansion in Africa in the fourteenth and fifteenth centuries. The Iberian penetration in Africa intensified in the fifteenth century, when competition with the Genoese and the Venetians began. Interestingly, at the end of the fifteenth century Seville had forty-four mercantile firms from Genoa, twenty from Florence, ten from Venice, and seven from Portugal, plus some English and Catalan enterprises. The situation in Lisbon was not much different, though that city was better connected with the merchants of Antwerp, Bruges, and London than Seville was. The Iberian expansion in Africa (and later in the Americas) was also an extension of Spanish and Portuguese activity in the Mediterranean, which was visible in their trading stations scattered along the African coast. Soon they began expeditions to bring slaves from Africa as well. In 1444 a chronicler described the African slaves disembarking in Lisbon: many were white, he wrote, others mulatto, and still others “black like Ethiopians.” The African expeditions of Prince Henry the Navigator, for which he had secured an exclusive license from the king of Portugal in 1443, were funded with profits from the slave trade. The Castilians also adopted this logic, and many ships holding royal licenses competed with the Portuguese, even attacking their vessels and their trading stations. The Portuguese retaliated, for example, with their constant forays on the Castilian-held Canary Islands. The Portuguese and Castilian expansion into the Atlantic also resulted in the gradual colonization of the Azores and Madeira by the Portuguese and the conquest and settlement of the Canary Islands by the Spaniards. Although the Portuguese king took over deserted islands, the Castilians first colonized the Canaries by establishing seigniories on the islands of Lanzarote, Fuerteventura, and Hierro, many of whose natives had been captured and sold into slavery in the early fifteenth century. The definitive conquest of the Canaries (especially the rich, densely populated islands of Gran Canaria, La Palma, and Tenerife) occurred between 1492 and 1496 and was initially managed by the crown; later, it became a jointly financed enterprise of trad24

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ers and conquistadors, as would likewise be the case for the Americas. Some Genoese traders who took part in the Canarian venture would also finance Christopher Columbus’s trips. The conquest of the Canaries, in which the conquistadors exploited to their benefit the rivalries of the local chieftains, was practically contemporaneous with the discovery of the New World, thus underscoring the continuity of these forms of expansion.

The First Iberian Invasion Not long after Christopher Columbus’s momentous landing on a small Caribbean island in 1492, Vasco da Gama reached India (1498), and Pedro Alvares Cabral discovered Brazil (1500). By the time Columbus died in 1506, Europe had already felt the first winds of change blowing in from the New World, even before the new continent was named America. Notwithstanding Columbus’s self-interested stubbornness, most Europeans considered these new lands the new Azores, and the rest believed they were the antipodes. Although intensive exploration of the Caribbean and the first contacts with terra firma took place between 1492 and 1513, only in 1521, when the Spaniards came upon the Aztec Empire (the Mexica Triple Alliance), would a new phase of the invasion begin. In the twenty years between Columbus’s discovery of the lands known as “islands and terra firma of the ocean sea” and the first invasion of Mexico, the Spaniards had founded numerous settlements in the Caribbean. Many, however, were no more than entrepôts for the Columbian enterprise of commercial colonization that was dissolved in 1499; indeed, few of these settlements had received the title of city, which would reflect a firm presence in the territory. These entrepôts show an organizational continuity between the Mediterranean and the New World, as well as between reconquest and invasion. This last element is formalized in the Capitulations of Santa Fe signed by Queen Isabella and Christopher Columbus in 1492. This document was a contract similar to those signed between the monarch and a captain during the centuries of reconquest, whereby the captain was to reconquer and repopulate the lands held by the Moors in exchange for rewards and titles of nobility. The Capitulations of Santa Fe granted Columbus and his descendants the title of viceroy and admiral of Castile and specified that the monarchs and Columbus would share equally the revenue from the commercial and economic exploitation of the new territories. However, the new lands would become the monarchs’ personal property. Reports of gold on Columbus’s first trip led to the establishment of a business on the island of Santo Domingo T h e I n va s i o n

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(Hispaniola) managed directly by Columbus. Everyone arriving from Castile was put to work under his authority, exchanging European goods for the gold extracted by the natives. Thus the basic activity of this Columbian enterprise, like that of the African entrepôts, was the barter of goods. The monopoly held by the crown and Columbus turned out to be poor business, however, because tribal life on Santo Domingo and the other Caribbean islands was organized around subsistence farming of cassava, sweet potato, yucca, maize, beans, and pumpkin. The Indians collected whatever alluvial gold there was purely for religious and ornamental purposes, and even though the Spaniards coveted it, it continued to be the rarest of goods. The royal-Columbian enterprise failed to grow, and the king considered closing it. But the entrepôt workers themselves struck the final blow when, in 1497, they rose against the monopoly and requested authorization to deal directly with the natives. The 1497 rebellion signaled the real beginning of the invasion of the Americas. Having revoked the monopoly in 1499, the crown began to grant licenses to individuals and companies for trading both between Spain and the Antilles and within the Antilles territory. A royal agency established in Castile in 1503, the Casa de Contratación de las Indias, subsequently regulated trade; modeled on the Portuguese Casa da Índia in Lisbon, it granted licenses, regulated trade, and collected the taxes owed to the crown. As a result royal officials made their first appearance in the Antilles. The new trade satisfied both the Spanish settlers and the monarchy, which sought to block Portugal’s expansion and enforce the jointly signed treaty that allocated maritime space. In fact, the Treaty of Tordesillas (1494) reprised the contents of a 1493 papal bull that assigned to the Catholic king the lands discovered by Columbus, while revising the demarcation line to 370 leagues west of the Cape Verde Islands. In this new phase the Spanish king had to find a way to reconcile conflicting interests—those of the settlers and those of religion outlined in the papal bull, which called for the evangelization of the natives—while still enforcing his own sovereignty over that part of the world. The Spanish monarchy had by then set out on a path that would lead, under Charles V, to a composite monarchy with universal or imperial characteristics in which political and ethical principles coexisted in the link between throne and altar. The still unexplored American regions took on a new significance in the king’s imagination and would occupy an important place in the crown’s political and religious plans for more than two centuries, in spite of the changes that occurred during that time. 26

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The new directions that the Spanish monarchy embraced as it was about to become the first great modern power were difficult to implement. Once the era of Columbus was over, the monarchy granted several licenses to Castilians for trading with the Antilles natives, but the low quality of alluvial gold, the difficulty in fishing for pearls, and the small agricultural surplus offered for barter ultimately transformed the merchant companies into veritable armed bands that raided Indian villages and captured the natives for use as slaves. These armed merchant bands were essentially conquest enterprises, whose partners and financial backers included royal officials, churchmen, and the stewards of the great Castilian and European mercantile firms that had their offices in Seville. In time the Iberian invasion of the Antilles led to frequent uprisings, the Indians having tired of the conquistadors’ treachery. Obsessed with gold and pearls, the Spaniards armed themselves with swords, spears, and crossbows and went about with vicious dogs as escorts. Sixteenth-century Europe learned about the horrors of the invasion through the Milanese Gerolamo Benzoni; his narrative, enhanced by Theodore de Bry’s vivid illustrations, was the first book to disseminate anti-Spanish and anti-Catholic sentiment in Europe. Nevertheless, the armed bands in the Antilles were, in effect, a vanguard. They built the first Spanish settlements by using their own weapons and goods for barter. More than just a commercial enterprise, they evolved into a political organization whose members had to obey the oldest or most respected of them, the caudillo (leader). When the settlements became stable and turned into cities, these bands took on an institutional character, forming muncipalities, each of which had its own government, the cabildo, or municipal council. With this transformation the bands became truly conquest enterprises—that is, sociopolitical organizations—rather than mere commercial ventures. The forays of these armed merchant bands, however, soon alarmed both the crown and the Church. Concern grew after the 1520s rebellion of the Castilian cities, which was harshly quelled by Charles V, who feared that the Castilians overseas might likewise aspire to independence. For its part, the Church pressed the monarchy to defend the Indian populations, which had already been decimated in the Antilles. To counteract the breakaway tendencies of the expeditions of conquest, the crown installed an audiencia in Santo Domingo. This was the first governmental and juridical body in the New World. Patterned after the Castilian audiencias, it consisted of a council of judges appointed by the king and charged T h e I n va s i o n

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with ruling the territory and administering justice. The position of royal commissioner (adelantado and alcalde mayor) was discontinued, although without putting an end to the expeditions of conquest. Several of these expeditions reached Tierra Firme and the Gulf of Darién (Castilla del Oro, now Panama), and the pearl-rich Cubagua and nearby islands (Venezuela). In the meantime sugar production began in the Antilles, and sugarcane soon would become the leading Caribbean crop for several centuries. Merchant shipping and sugar production enabled the first American treasure to arrive in Spain: between 1503 and 1510, some 200,000 ducats a year were unloaded in Seville, of which 70 percent went to the merchants. The remaining 30 percent were taxes collected in the New World. The effort to strengthen the king’s authority in America intensified the activity of the Church, especially the religious orders, which made public pronouncements in favor of the Indians. As a result of Church pressure the Spanish enacted the first laws protecting the natives, known as the Laws of Burgos, in 1512. Thus, alongside the economic and social interests, spiritual interests began to take shape, resulting in the increased presence and influence of royal dignitaries and churchmen. Despite these political correctives, the Spanish invasion of the Antilles took a heavy toll. The population of the island of Santo Domingo shrank from 3.7 million in 1492 to a mere sixtysix thousand in 1519, a loss that prevented the birth of a Spanish-American society, which would emerge later on the subcontinent. The Brazilian regions were similarly affected, as the Portuguese crown tried to assert its sovereignty in Brazil in keeping with the Treaty of Tordesillas. To reach its goal without any outlay of resources, Portugal granted an exclusive license to Fernando Noronha’s merchant company to cut and ship the trunks of the tree known as brazilwood, which was used to produce a red dye. As had been the case for the Columbian enterprise and for African trade, the Noronha monopoly installed trading stations where the precious trunks harvested by native tribes were bartered for Portuguese and European goods. But here too the monopoly system soon grew rife with problems, not because of disagreements between the partners and the Portuguese employees but because of competition from the French, who were also interested in the precious wood. The arrival of the French in the New World was the first in a long series of infiltrations by European countries that refused to recognize the division of the New World between Portugal and Spain. The clashes between the French and the Portuguese helped sharpen intertribal conflicts as tribes would ally with one or the other. Most likely, the situation exacerbated human sacrifice 28

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practices and promoted the intertribal trade of Amerindian slaves, which was previously unknown. The trading between invaders and natives led to the first mixed-race unions and the birth of the mameluco (the Portuguese equivalent to the Spanish mestizo), which contemporary Brazilian nationalism identifies as the prototype of the Brazilian. The European invasion of Brazil was very bloody as well: about 2.5 million Tupi and Guarani who lived along the coast died. The devastation of the native populations caused by the spread of European epidemics, tribal wars, and slavery prevented the rise of a Portuguese-American society, as had been the case in the Antilles for Spanish-American society.

Invasion and Conquest In the sixteenth century the Spanish monarchy born of the union of the crowns of Castile and Aragon accelerated its imperial designs. With the ascent of Charles V to the throne in 1517, an empire comprising a plurality of realms, with laws and institutions founded on widely dissimilar cultural and political traditions, came into being. Charles V’s empire did not destroy the many cultures within it: the innovation was that he allowed them to live side by side, united under a common system of symbols. Elements of this system included the Catholic faith, a court that could assure the subjects’ loyalty to the crown, and an administration that could convey to the emperor the needs of each different realm. The new empire was a mosaic with tiles of different shapes. Although these pieces did not fit together perfectly, the whole projected an image of unity—a unity that the Spanish monarchy would not actually achieve, or even seek, before the eighteenth century. The Portuguese monarchy projected the same image. In both cases, the monarch was seen not as the king of Spain or Portugal but rather as the ruler of a number of European and American kingdoms. The element that brought unity to both Iberian monarchies was thus the figure of the king as a symbol of justice and a defender of the faith—he who metes out justice, rewards the good, punishes the evildoers, and enforces respect for the rights and duties of each subject as dictated by social rank. This was the ideal of good government that the empire guaranteed to all its dominions. The imperial organization that resulted from this concept was established in the various territorial councils. In the early sixteenth century there were two, for Castile and Aragon; the Council of the Indies was formed in 1524; the one for Italy in 1555; the Portuguese one in 1582, when the two crowns were joined as the Iberian Union; and the Flemish one in 1588. Before the T h e I n va s i o n

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two crowns were joined, the Portuguese Empire had two territorial councils, for Portugal and the Indies; the latter’s autonomy would be preserved even after Spain and Portugal came under one monarch. In this empire under construction, Castile and southern Portugal were to supply the manpower, financial means, and organizational models for the New World. In fact, the American territories—or West Indies—ceased to be the personal property of the king only in 1519, when they gained the right to their own territorial council, the Council of the Indies. Although the council inherited the legal and institutional traditions of Castile, it produced new laws and institutions because it was forced to take into account Amerindian common law. The new status of the West Indies in this second phase of the invasion corresponded roughly to the rise of the Spanish monarchy under Charles V. Central to this process was the disappearance of the old expeditions authorized by royal functionaries and the requirement that capitulaciones, or contracts between the monarchy and potential conquistadors, now be authorized by the Council of the Indies. The institutional tightening is visible above all in the king’s greater oversight of officials and of the conquistadors’ plunder, as well as in the king’s defeat of the organized rebellions of the conquistador titleholders, such as Gonzalo Pizarro in Peru (1543) and Martín Cortés in Mexico (1566). The new governing of the New World was more effective than previously thought, although of course it did not bring justice or, much less, equality of rights for Amerindians. The tighter royal control held in check the seigniorial tendencies that had flourished during the invasion of the Antilles and introduced the imperial organizational principle to America. The king’s strengthened authority (not to be confused with the beginning of absolutism) inspired in Spanish and native subjects alike the idea of the king as the guarantor of the rank-based liberties that had taken root in the various American territories. Because the colonies could not regularly convene in the Cortes, deputies from the leading American cities defended these liberties in the king’s court. The fact that America was no longer the personal property of the king, and that it was becoming an integral part of the monarchy, conditioned the course taken by this second wave of invasion. Moreover, on the American continent the invaders would confront better-organized Amerindian societies that could respond politically and socially. The conquests of first Mexico and then Peru thus marked a significant turn. During the Iberian invasion, the so-called Spanish conquest, the conquistadors captured the principal centers in just over thirty years, from 1519 to 1550. 30

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The occupation proceeded by gemmation: once an important center such as Tenochtitlán (Mexico City) was seized, further expeditions branched out from it, taking new territory and creating a network of Iberian settlements. Four centers branched out from Santo Domingo: Panama (1519), Mexico (1521–24), Peru (1534–35), and Buenos Aires (1536–37). The occupation of vast territories started from these settlements and was organized with small bands of Spaniards. The penetration of the Mexican hinterland was quick: in twenty-six years, from 1521 to 1547, the central part of Mexico—which was the heart of the Mexica, or Aztec, Empire—passed into the hands of the invaders. The invasion of the Andean territory was not much different. Between 1534–35 and 1550 the Spaniards extended their control to the Andes and branched out into Chile. They followed a similar path in Río de la Plata; moving up the river between 1536 and 1553 they occupied the inland areas up to the foot of the Andes—today’s Tucumán. In Brazil the invasion took on a different rhythm. As late as 1550 the donation of territories to the Portuguese nobility had not led to the founding of important centers of territorial control. Only three settlements, Pernambuco, Bahia, and São Vicente, showed some dynamism. In 1540 the Portuguese had failed to stem French infiltration; it would subside only after the kings of Portugal and France had signed a peace agreement. The Spanish invasion was faster than the Portuguese, thanks to the Spaniards’ underlying structure. Portugal used the donataria system, which became the norm at the time of the most intense French penetration; the donatários (recipients) were granted hereditary captaincies over about fifty leagues of coastline as well as inland territory of unknown size. The cartographic reconstruction of the Brazilian seigniories indicates that the lands assigned to the donatários were colonized by them at their own expense in exchange for such rights and privileges as the governmental, administrative, and judicial control of the captaincies, direct rule of vast expanses of land, and authority to grant land to their own subjects. The king’s authority was limited to the trade monopoly of precious wood and spices and the levy of taxes on precious metals and diamonds. In contrast, the Spanish monarchy perfected the capitulación, the legal instrument that gradually replaced the now annulled privileges originally granted to Christopher Columbus and his heirs. This type of agreement obligated the licensee to explore, settle, and populate the grant territory at his own expense. These operations were entrusted to a conquest expedition organized by the grant holder (the conquest captain), with no financial or T h e I n va s i o n

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military support from the crown. The capitulación formally set forth the rights and duties of the captain and his men. Among the rights was the appointment of the captain to the office of governor and the possibility that he would be granted a title of nobility. Both he and his men were exempted from taxes, and the men were given official and municipal positions, in addition to being awarded lands and an inheritable income derived from the tribute that the Amerindians paid to the king. The conquistadors were subject to the king’s laws and to the authority of the royal officials in charge of overseeing the levying of taxes and duties. Finally, the king could suspend or revoke any of the rights he had granted. Not only was the capitulación adopted by the Spanish monarchy easier to control, but it was also a more flexible tool than the Portuguese system. The capitulación expired if not acted on promptly, whereas the Portuguese donataria could be transferred to a third party. The greater flexibility and incisiveness of the capitulación, together with tighter control by the officials and priests engaged in the conquest, forced the expeditions to reach their goal as swiftly as possible. Among the methods they adopted were formal, but also forced, alliances with the Amerindians, which allowed the conquistadors to move freely about the territory and, with the aid of interpreters, take full advantage of intertribal rivalries. No doubt the Iberians’ skill in drawing the natives into their enterprise was useful for colonizing purposes. Another significant factor in the conquest—one that is often overlooked—was the individual set of abilities that the different captains demonstrated. In spite of obvious similarities in the conquests of Mexico and Peru, the martial and political styles of Hernán Cortés and Francisco Pizarro were vastly different. So too were the skills of Pedro de Valdivia, who conquered Chile, as compared to those of Juan de Garay, who occupied Paraguay. But beyond those who won preeminent positions in the new society were the many Iberians, the españoles pobres, who failed to make a fortune. This large group is important because it supported the nascent municipal institutions, helping to check the feudal intentions of the captains and, more generally, of the encomenderos, the lifetime beneficiaries of Indian tributes. The society that began to emerge from the conquest was not a mere dualism between the dominant and the dominated but rather a world that slowly took on Iberian traits, a stratified society with differentiated rights and obligations derived from the individual’s level in the social hierarchy in a system protected, guarded, and defended by the monarchy. This explains the existence, especially in the north central and Andean regions, of Amerindian lords and 32

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notables who understood the advantages of the new situation, including the possibility of turning a considerable portion of common land—which in pre-Hispanic society they could manage but never own—into their private property, Invasion and conquest are terms associated with violence, abuse of power, and illegality. The level of violence during this phase of the invasion, although certainly great, was less pronounced than in the initial phase, not just because mixed-race unions were becoming more commonplace but also because the poorer conquistadors and the Indian notables were thwarting the feudal tendencies of the more powerful conquistadors. Another factor was the failure of the Antillean experience. The resistance to the conquistadors’ ruthlessness meshed nicely with the Church’s moderating efforts, in particular the work of the Dominican, Franciscan, and Augustinian orders and of the secular clergy. Their work transcended the religious sphere, since the hundred or so monasteries active in New Spain in the 1570s not only gave shelter to the indigent but also disseminated European culture and agricultural methods to the native populations. Accounts by the Indian notables and the conquistadors, such as the reports that Hernán Cortés wrote to Charles V, shed light on the many cultural and social adaptations in this early conflict-ridden phase. They portray an Amerindian and Spanish world shot through by tensions, one in which any alliance or understanding between the two peoples could not last because it was motivated by limited, short-term goals. The Indians showed great skills in exploiting the conflict among the Spanish captains, supporting one to weaken the other, all the while knowing that this tactic did not amount to a strategy. Against this background of partial alliances and ententes, several political projects developed that would help bring about a new order. An example is Cortés’s plan, which he laid out in his reports to Charles V. Cortés begins by criticizing the invasion of the Antilles, hoping to prevent repeating the same mistakes in Mexico. That is, the Spaniards should not “exploit and destroy it, only to abandon it,” but rather should lay the groundwork for a future “great and noble land where God Our Lord shall find and gather thousands of faithful and Your Majesty shall reap great rewards.” Cortés’s plan (his enemies would accuse him of lèse-majesté) revolved around the idea of a permanent “alliance” with the Indian lords. He applied this idea when, after imprisoning the emperor, he “restored the office of lieutenant held at the time of Moctezuma” to a Mexica nobleman and appointed other notables to “city government posts, in accordance with their customs.” In this way, Cortés T h e I n va s i o n

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concluded, “I did all in my power to honor them and grant them privileges, and they returned the favor” (Cortés 1970). Cortés’s plan was in harmony with the emerging reorganization of the Spanish monarchy in an imperial system that subsumed a number of different kingdoms or provinces without destroying their internal autonomy. These ideas also appear in the writings of an Inca nobleman, Felipe Guamán Poma de Ayala, the author of one of the most extraordinary accounts of the conquest, Nueva corónica y buen gobierno (New Chronicle and Good Government), which he wrote in the early seventeenth century. Poma de Ayala developed the idea of a kingdom in which each province (the four parts of the ancient Inca Empire) is governed by Amerindian lords, while an emperor sits in the center, in Cuzco, the Inca capital. This emperor is none other than the Spanish monarch, at once also the Inca emperor, thanks to Huáscar’s abnegation in his favor. The invasion of the American continent entailed enormous challenges, both material and cultural, that forced the conquistadors to adapt and react flexibly to the new demands. A similar process also occurred in the conquered populations; just a few years after the invasion, they were mastering the invaders’ language and in some cases even using the Spanish alphabet to transliterate their mother tongue. Many intermediaries participated in this interaction, foremost among them the clergy, who, notwithstanding the destruction wrought in the name of the faith, saved a significant part of the Indian heritage. Like the first phase, this phase of the invasion began with acts of force on the part of Iberian armed bands, but it eventually led to a variety of economic, social, political, and cultural phenomena of adaptation and connection between the conquerors and the conquered. Both sides were thrown into a mutual learning process, which extended even to war practices. Soon the Indians, the nomadic tribes especially, mastered horseback riding and became mobile, a custom that for many tribes would last until the nineteenth century. Thanks to the progressive assimilation of Iberian novelties such as the horse and the spread of semiwild livestock, nomadic and semisettled Amerindian populations successfully slowed the Iberian advance in the outlying regions, starting in the second half of the sixteenth century. Likewise, contact with the natives taught the Spaniards and the Portuguese to rely less on firearms, since gunpowder was inefficient in a humid, tropical climate and cannons were difficult to move. As a result the most effective Iberian weapons on the battlefield became the crossbow, spear, and sword; the Iberians also found horses and dogs useful in battle. 34

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T h e Se a rch for N e w Con n ec t ions

The Americas under the Iberian Monarchies The first convergence of the American territories into the Iberian world occurred as the Spanish Empire adopted a pan-Iberian policy under Philip II. This policy led to a reorganization that sought to give the king and his court more control over the several dominions composing the monarchy. The growing financial demands of the wars in Europe, the need to control the secession-minded European dominions outside Castile, and the decision to unite Spain and Portugal under one crown—which would finally be realized in 1580—all were motives for reorganization. One result of Philip II’s reorganization was the increased importance of the royal bureaucracy, which would continue under his successors in the first half of the seventeenth century. This should not be confused with a tendency to centralize all political offices in the king’s hands, a feature typical of absolute monarchies. The specifically Iberian brand of centralization instead gave rise to umbrella institutions that kept the various local entities under direct control without eliminating their diversity. In this period, in fact, in contrast to the trend in the other European absolute monarchies, the Cortes continued to represent the three estates (clergy, nobility, and cities), an arrangement that allowed the king to levy new taxes and augment the treasury’s revenues. Nor did Philip suppress the powers and privileges of the municipalities; the cities, as well as the new royal institutions, bound the upper nobility more securely to the king. The bureaucratization of the monarchy is visible in the expanded duties of the territorial councils. Begun under the Catholic kings, the expansion had continued during the long reign of Charles V when the Council of the Indies was created (1524); Philip II created the other councils. Several decades elapsed between the establishment of the Council of the Indies and the consolidation of the royal administration in the New World, as the crown did not yet have a clear vision of the form the invasion had taken—in particular, what privileges and rights had been granted there and how they could be revoked, or at the very least monitored. As a result for a long time Philip consulted the Council of the Indies only occasionally, mostly to resolve practical matters. Only beginning in the second half of the seventeenth century would the different spheres of royal intervention be defined and the general interests of the monarchy be differentiated from those of the American territories. The justice, finance, and war departments would remain under the direct authority of the king and his administration, while the other departments The Search for New Connections

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would be managed by the dominions—that is, by the local propertied classes and the local administrations that, in Europe as well as America, were the essential pieces of the composite monarchy. Given the Spanish monarchy’s transformation into the Iberian monarchy, through its union with Portugal from 1580 to 1640, the incorporation of the West Indies was not the result of a rational plan but of strain between local and imperial interests and needs. For the monarchy the American riches became paramount, in particular the shipments of silver, which allowed the crown to meet its growing needs after the Castilian economy, impoverished by European wars and the invasion and conquest of the Americas, slid into a phase of relative decline around the end of the sixteenth century. The greater convergence of the court and the royal institutions was also driven by specifically American interests, interwoven with the growing belief that Iberians were superior to the Indians. Letters from Ibero-Americans to friends and relatives at home make this conviction explicit, as do official documents and the writings of jurists. To tighten its control over Spanish and Portuguese subjects in the Americas, the crown granted the Church the power to protect the Indians, guaranteeing their right to a social rank. Thus the inclusion of the Indians in the monarchy had, at least in part, an ethical foundation. Because the conquistadors and their descendants were not a uniform group—they split into warring factions often and lived on the same land as the Indians—the monarchy, working closely with the Church, revised and adapted the medieval covenant that saw the foundation of the crown’s power in the union between “the people”—the subjects—and the king. Promoting the idea of loyalty to the king helped the monarchy enforce the union of the New World dominions with those of Europe. The result of this unification process is clear: for three hundred years the crown saw no need to station a military force in America in order to control it. This strong loyalty to the king was spontaneous, a mirror of the vitality that had characterized the Iberian invasion. It became even stronger after the rapid decline of Indian organizations and populations and the dissemination of European products and techniques; it was encouraged by the financial needs of the monarchy and also of the descendants of the conquistadors, who had to supplement their diminishing returns from Indian tribute with new income.

The Origins of Colonization It would be simplistic to consider the destruction of the native peoples as genocide, for it was not the result of an intentional design pursued by the 36

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conquistadors or the Iberian monarchy. The Indian population began to decline from the day that Columbus set foot on American soil. This decline continued in many areas with no European presence because, as reported in Indian accounts in the Andean regions, European infectious epidemics also spread via traveling Indians and transported European and American products. Smallpox, totally unknown before the European invasion, reached Peru a few years before Pizarro and Almagro set foot in the region. Until the early eighteenth century, recurring epidemics of smallpox, typhoid fever, measles, and influenza hit Europe during poor crop seasons, causing a steep rise in the number of deaths. While the strict correlation between demographic and nutritional crises had, over the centuries, partly immunized the European populations, that was not the case for the Indians, who until then had been totally isolated from the Old World. For the Indians, then, the epidemics had tragic results. Only toward the end of the sixteenth century did the natives begin to generate antibodies, and the population resumed its demographic growth in the Mesoamerican and Andean regions starting in 1620–40. In the early sixteenth century, however, a small piece of cloth contaminated with smallpox could still infect thousands of people, and for a long time, definitely until the nineteenth century, European epidemics remained a latent threat for the native Americans. Some Spanish and Portuguese sources attribute the fall of the Aztec capital to the spread of a smallpox epidemic, which in any case killed Cuitláhuac, the Aztec commander, a skilled strategist who months earlier had defeated Cortés and driven him from the capital. Nor did just one epidemic guarantee greater immunity, for the probability of survival is the result of a much longer process. European-borne epidemics appeared in the Americas about every ten years in the sixteenth century, and less frequently in the seventeenth (1607–1609 and 1620–22), although by then they had reached northern Mexico and the Brazilian coast. After the 1620 crisis the negative effects of the epidemics began to subside. Subsequent epidemics resembled those in the European ancien régime, with poor crops and overwork causally linked to them, factors that no doubt deeply affected the slave population. The effects of the Amerindian demographic decline are visible in the Aztec Empire, whose population plummeted from 25.2 to 6.3 million between 1518 and 1548, the period that coincided with the Iberian invasion and the spread of epidemics. From 1548 to 1622 the Indian population continued to decrease, from 6.3 million to 1 million. This second phase was undoubtedly the result of the combined effects of the epidemics, the spread of European forms of production in agriculture and mining, and the birth of a mercanThe Search for New Connections

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tile economy. In the Inca Empire the population also drastically decreased during the invasion, from 9 million in 1520 to 1.3 million in 1570. During the following phase, that of assimilation, the population further shrank to 600,000 at its lowest point. Similar phenomena visited Central America. In general, these declines were most severe in areas of predominantly tribal civilizations; there the native races died out, as occurred in Venezuela, parts of Chile, and along the tropical coastlines. With this massive depopulation the dreams of the Castilian and Portuguese invaders for prestige, greater honors, and riches were shattered, or at least cut down to size. The income the Spanish invaders derived from the tributes (encomiendas) plummeted, based as it was on the number of surviving Indian families. But the loss was more than economic: the conquistadors and their descendants also saw their prestige dwindle, since their lordly status depended on the existence of Indians as tribute givers and vassals. Thus the conquistadors’ only solution was to convert the tributes into labor—which was more profitable—on the lands or in mines received in free grant (merced). In Mesoamerica and in the Andes, which had been less harshly visited by the demographic catastrophe, however, the plan was difficult to realize because of the restrictions imposed by both Church and monarchy. As the Iberians began to settle permanently and manufacture their own goods, they became Americanized; they were even called Indianos in Spain, meaning Spaniards born or residing in the West Indies. This change in their livelihood was also motivated by the depletion of natural resources, such as wood, pearls, and alluvial gold, which until then had simply been looted. The Iberian monarchy strongly encouraged permanent colonization to protect the native populations and curb the rising power of the Ibero-American classes. The decimation of the native Indians and renewed royal oversight created favorable conditions for the development of European-style agriculture and mining, a process begun in Spanish America with the opening of silver mines in the Zacatecas region of north-central Mexico and in the Andean region of Potosí, today part of Bolivia. In Portuguese America, European-style agriculture began with the production of sugar, as was also the case in the Spanish Antilles, and later the French and English Antilles. The colonization of America was an important starting point, for in building a material base framed by monarchical institutions to shape the emerging society, the American areas became Iberian and, indirectly, European offshoots. The new crops and industries reconciled the use of a smaller population with the needs of the Iberian groups and the political and commercial 38

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demands of the monarchy. While the invasion demonstrated the cultural and political skills of the conquerors and the conquered, the new reality heralded the birth of an Ibero-American order. This world was built on the settlements founded, and sometimes refounded, by the conquistadors with the title of cities. Among these were Tenochtitlán (Mexico City) and Cholula in Mexico and Cuzco in Peru. The cities, important organizing centers of the new society, were military bases, trading stations, and seats of municipal government entrusted to the conquistadors; they were also the first ethnically mixed areas. The cities were more than expansion centers of the new economy or, as they have been called, Iberian structures parachuted into an ocean of Indians (Hoberman and Socolow 1986). The cities were well distributed geographically and sprouted along the penetration routes of the conquest bands. Although the invasion, conquest, and colonization are connected, the colonization, unlike the first two, would generate a series of direct, and especially indirect, effects. From 1570 to 1630 the cities did not grow at the intense pace of the first period. This is especially true of Mexico City and Lima, the two viceregal capitals and the largest cities, whose population remained stable at 15,000 and 9,000 inhabitants, respectively. But the number of medium-sized cities grew, especially those with populations between 1,500 and 3,000, such as Guanajuato, Puebla, Oaxaca, Bogotá, Guatemala City, Cuzco, Arequipa, Santo Domingo, Panama City, Olinda, Recife, and Bahia. Their growth went hand in hand with new mining ventures, farms, and plantations. Such was the case for the Mexican mining centers of Zacatecas and Guanajuato and for Potosí in Upper Peru, as well as for Santo Domingo, Recife, and Bahia, which were linked to the expansion of sugarcane production, and for Arequipa and Panama, important trading ports for European and American goods. From map 1 it is clear that the mining ventures extended the reach of the urban centers, reorganizing the territory and connecting towns to farming areas and ports. In Mexico, for instance, Guanajuato and Zacatecas formed the mining center, while the area between Mexico City and Querétaro became farmlands linking the viceregal capital to the port of Veracruz and from there to Spain. A similar path led from Potosí—where silver mines brought dynamism not only to the surrounding Andean area but also to the Tucumán, Córdoba, and Santiago de Chile regions—to Spain and Europe, connecting by way of Arequipa, Lima, Panama City, or Buenos Aires. New crops such as sugarcane in the Bahia area, cochineal in the Mexican The Search for New Connections

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San Francisco

Los Angeles San Diego

Santa Fe

St. Louis

El Paso

St. Augustine

Chihuahua Monterrey Zacatecas Guadalajara Guanajuato Querétaro Mérida Veracruz Mexico City Puebla Acapulco Guatemala City

Havana

Santo Domingo Trujillo Coro Portobelo

Zacatecas Guanajuato Querétaro

San Juan

Santiago

Panama City

Cartagena

Cumaná Caracas

Trinidad Stabroek Berbice Paramaribo Cayenne

Bogotá

Quito Guayaquil Piura

Manaus

Belém

São Luís Natal Olinda Recife

Trujillo Callao Lima Huancavelica

Bahia Cuzco La Paz

Arequipa

Indian and Mediterranean agriculture

Santa Cruz Chuquisaca

Arica Potosí

São Paulo

Silver and gold mining Livestock ranching Cacao, sugarcane, maté, indigo, and cochineal plantations Unoccupied land Manila-Acapulco route for Asian goods

Salta Tucumán

Asunción

Porto Alegre Córdoba

La Serena

Santa Mendoza Fé Montevideo Valparaíso Santiago Buenos Aires

Acapulco-Manila silver route New Spain–Peru route for Asian goods

Concepción Valdivia

Peruvian silver route and route to Peru for European goods Illegal route to Peru for American and European goods

Carmen de Patagones

Castro

Mexican and Peruvian silver route to Europe European goods route to the Antilles Commercial routes between Brazil and Portugal Contraband routes in the Antilles Cape Horn

map 1. The New American Space, ca. 1650

Rio de Janeiro Santos

region of Oaxaca, and indigo in Guatemala spurred the economy, because unlike silver mining, which required relatively little manpower, these crops relied on great use of the local workforce (as in Oaxaca and Guatemala) or an influx of laborers from other areas (as in Brazil). The Brazilian plantations in Bahia, Pernambuco, and Ilheus, as well as the Caribbean plantations in Santo Domingo, required the forced transfer of Indian laborers. In fact, the main activity of the settlers in São Paulo was to organize armed bands that penetrated as far as Paraguay or deep into the Brazilian wilderness to capture Indians to be sold to the sugarcane plantation owners in the country’s northeast. Only later, when enslaving the Indians became too difficult or burdensome, did the importation of African slaves begin. Because the Indian communities directly managed the production of cochineal throughout the colonial period, and of indigo until the mid-seventeenth century, they were able to preserve their native languages, customs, and traditions, thus lessening the weight of colonial domination. In exploiting these dyestuffs, the Indians developed a new relationship between scarce labor and commodities that were sold at a high unit price. The skills demonstrated by the Mesoamerican and Andean Indians during the Americanization phase of this industry, using preexisting textile-making know-how, points to an underappreciated talent: their ability to adapt to doing business with the Iberians without forsaking their culture. The industrial transformation of America in the span of a century led to increased population and activity in the mining areas and nearby farmlands, where intensive crops such as sugarcane, cochineal, cacao, and indigo were cultivated, as well as along the traffic routes, specifically, the Mexican eastwest route from Veracruz to Acapulco and north-south from Zacatecas to Guatemala, and the Andean route from Lima-Arequipa to Potosí and from there to Buenos Aires, passing through Tucumán and Córdoba. Activity decreased with distance from these central axes, although that is not to say there was a lack of activity or the mere persistence of pre-Hispanic modes of production in many of these areas. In these outlying territories, many of which still had no Spanish presence, horses, donkeys, mules, sheep, goats, and cattle originally imported from Europe lived and reproduced in the wild; they quickly became an important economic resource, giving rise to new commercial activities. Thus, even before the creation of latifundios, haciendas, and ranches in many American territories, livestock proliferated and provided sustenance for the new mestizo populations. 42

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Map 1 shows the rapid spread of European livestock starting from the early colonization period, an expansion notably preceded by a demographic void. Probably no one noticed the correlation between the two phenomena because the Iberian population began to grow only after the 1630s. From about 1500 to 1580, only 139,000 Spaniards and 93,000 Portuguese immigrated to America, that is, no more than 5,400 people a year; and from about 1580 to 1700 Iberian immigration remained minuscule: only 4,200 Spaniards and Portuguese crossed the ocean for the New World each year. Nevertheless, according to American sources, the population considered to be Iberian grew very quickly, probably on account of mixed-blood births. The rapid increase in livestock—especially mules, horses, and cattle— helped to offset the shortage of labor resulting from the demographic loss. Thus, the incorporation of the American territories into the West was the result of the combined effect of animal labor, savings resulting from the adoption of farming tools such as plows and infrastructures such as aqueducts and roads, and American improvements to European mining techniques. To understand the dramatic repercussions from the loss of Indian population in the earliest Westernization phase, it suffices to note the growth in the importation of black slaves from Africa after the sixteenth century. Between 1525 and 1600 Spanish America imported 75,000 slaves; Portuguese America, 50,000—or about 1,666 slaves per year in all, with a growth of 1.8 percent per year. The decrease in the Indian population in the same period, from 3 to 4 percent per year, means that there was a 1.2 to 2.2 percent shortage of labor each year. Between 1600 and 1700 an estimated 1.3 million African slaves were brought to the Americas, 830,000 of whom were destined for Spanish and Portuguese America. That century saw a 1.9 percent rate of population growth, a full percentage point higher than the natural population increase in America in the same period. The lack of manpower prevented the founding of large estates—the latifundio system that would become a salient feature of Latin American agriculture in the mid-seventeenth century. The creation of latifundios would be made possible by the availability of vast expanses of land that had been abandoned as the indigenous population dwindled or that had never been farmed productively by the tribes occupying them, leading to an underuse of natural resources and the spread of livestock raising, an activity that required little human labor. The incredible wealth of natural resources was both an advantage and a disadvantage. The lack of laborers drove landowners to introduce forced peonage, which curtailed the workers’ mobility and thereby reduced the cost The Search for New Connections

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of labor. This in turn gave rise to a paternalistic system to mitigate the workers’ feelings of oppression. The development of the economy from Mexico to Río de la Plata, including Portuguese Brazil, did not involve simply turning wilderness into farmland or excavating mines in the frontier regions. There were also Indian and mestizo farming areas and textile manufacturing. Thus production was diversified, not just in each vast colony but also within each region. The productivity of the Indian villages in the Mexican region of Oaxaca—which turned out precious goods for intercontinental trade, such as cochineal, as well as textiles and agricultural products for the local, regional, and interregional markets— was greater than that of Ibero-American farms in the same region, which mainly produced livestock and grains for the local and regional markets. An abundance of resources, a continuing shortage of labor, and the gradual adoption of exchange value were the main factors that enabled the different American economies to join the Western markets. These three factors explain why the adoption of European techniques required a tremendous use of animal power and why certain industries developed some of the most significant technological innovations of modern times, such as the process of amalgamation to extract silver.

The New Institutions Through commerce the weak points of American industry and agriculture could become relative advantages. The combination of plentiful natural resources with a shortage of workers, which from 1570 to 1600 became critical, forced landowners to specialize in high unit-price goods (silver, sugar, dyestuffs) or in commodities that either had no competition from Europe (sugar) or had very low production costs because of the vast supply of raw materials (leather and hides). A royal monopoly institutionalized these changes. Map 1 shows the many commercial routes existing at the time. The fleets and convoys to and from Spanish America were overseen by the Casa de Contratación of Seville, while Portuguese-American trade was regulated by the Casa da Índia e da Guiné in Lisbon. There were also semilegal routes connecting the American dominions, controlled by the merchant guilds of Mexico City and Lima, which were organized in the Tribunal del Consulado, as well as those of Pernambuco and Bahia, Brazil. Still other routes were linked to slave trade franchises. Finally, among the semilegal traffic and slave traffic routes were interspersed routes of contraband goods. Thus, it appears that American areas were not only linked to large cities 44

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but also directly interlinked, and, through contraband routes, further linked to large marketplaces such as Genoa, for the Mediterranean, and Amsterdam, for Atlantic Europe. Because American trade was not completely controlled by the royal monopolies, official reports that speak of a trade slump and decline from 1600 to 1650 probably are not reliable. Recent studies point out that when the amount of American silver that reached Europe increased, the quantity recorded by the royal monopoly of the Casa de Contratación remained unchanged, and that 29 percent of the silver produced from 1576 to 1600 (and 25 percent from 1651 to 1675) circulated within American markets. It is fair to say, then, that from about 1570 to 1650, the American territories experienced a true economic rebirth. In the process they adopted an economic logic close to that of Europe, leading to an interpenetration of the American and European economies. One typical example of this new logic, as already noted, was the organization of networks with the cities of Spain and Portugal, which reconfigured the administration of Indian villages. In Mesoamerica and the Andes, as well as in many tribal territories, the preexisting ceremonial-political centers were converted into political-administrative seats under the indirect oversight of the monarchy. The establishment in 1591 of Indian municipalities with their own councils ruled directly by Indian notables (cabildos de Indios) became an important mechanism for weaving the Indians into the new economic and social fabric, regulating them, and translating into Iberian terms the preexisting hierarchies, so as to collect the personal tribute that the Indians owed initially to the conquerors (encomenderos) and later to the monarchy. It also made possible the supervision of trade, the spread of evangelization, and the increased authority of the royal commissioners. Both Portugal and Spain had long experience in governing kingdoms and territories ruled by vastly differing local institutions, and the Americas fit easily in this logic. Even non-Iberian ethnic groups, the Indians in particular, espoused the notion of a king who could impose rules of good governance and enforce the diverse rights and duties pertaining to each category of subjects. This diversity had been recognized in the contracts signed between the king and the conquistadors (the capitulaciones in Spanish America and the donatarias in Luso-America) and quickly led to the founding of Iberian municipal councils (Spanish cabildos de Españoles and Portuguese câmaras municipais). In Spanish America Indian communities were also allowed to have their own cabildos (cabildos de Indios), starting in 1591. This recognition of native forms of government is only apparently belated, because the position of the native lords—the caciques—had been reconfirmed after the The Search for New Connections

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invasion. When the new municipal organization was applied to Indian communities, the pre-Hispanic hierarchies remained intact, even as the native notables were co-opted in the indirect administration of their people. Recognizing the rights and duties of the different ethnic groups allowed the Spanish and Portuguese monarchies to reduce the costs of running the empire and to focus directly on policies, justice, and finance with a minimum number of royal officials. Under this three-pronged approach, the king’s political and administrative bodies answered the multiple demands of the Church, religious orders, cabildos, merchant guilds, and the royal court itself. At the same time they had to promote the general interest of the monarchy in the European concert of nations. The multiple pressures to which the monarchy was subjected from both continents were especially visible in its attempts to contain the interests of the conquistadors and their heirs by stripping them of jurisdiction over the Indians and control of the cabildos, thus reducing the possibility of collusion between American notables and officials sent from the peninsula. The logic that informed the governance of the American territories—what we would today call indirect government—gave a voice to all the components of the various dominions; it also quickly expanded the peninsular fiscal system by taxing the notables, guilds, and all levels of society. This emphasis, more fiscal than political, suggests that America enjoyed more freedom than the kingdoms and provinces of the mother country, perhaps because society was not as closely knit into a guild-based, or corporatist, system. The sheer geographic distance from the court and the metropolitan councils, the plurality of ethnicities, and, finally, the informal division into ranks or classes that lacked a true legal status also contributed to the greater freedom. In this greater informality the skills of the different groups flourished. The Indians survived the ravaging epidemics and held in check Iberian oppression because the relative freedom in which they moved allowed them to evolve new strategies, including adapting Iberian culture and ideas. The Indians also resisted the commercial co-optation forced on them by district officials and developed a rotating system of elective offices that strengthened social cohesion in each municipality. This social reorganization also benefited lower-class Ibero-Americans. In fact, between the end of the sixteenth century and the first half of the seventeenth, conflicts between the plain Iberian folk (vecinos) and the conquistador class and its descendants abated as the social criteria became closer to those in use in the peninsula. This appears clearly in the importance that honor gradually acquired as an indication of rank—not simply family honor 46

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but also that conferred through service to the king. Also important was the new value of wealth as a component of rank: it became a crucial variable in forging family alliances through marriages between people who had received great honor and prestige—the encomenderos, ingenio owners, or royal officers—and the rich families of traders, landowners, or mine owners who had yet to receive high honorific offices. The monarchy took an active role in this restructuring of society. At the end of the sixteenth century it began to encourage the formation of merchant guilds and the like; later it offered prominent men the option of buying public offices in cabildos and local administrations. These factors, together with the access to military rank and the purchase of titles of nobility, helped construct a class of notables throughout Ibero-America. Descriptions of the social changes between about 1570 and 1650 suggest that while the Portuguese crown was not interested in building a biethnic society, the Spanish king favored it in Mesoamerica and the Andean regions. Spain’s policies probably resulted from the failure to convert the nomadic and seminomadic Indian tribes into sedentary groups. In fact, only with the Guarani of Paraguay was this possible, a success reached by entrusting the entire region to the Jesuits, who set up Indian forms of government and even restructured the native economy with the cultivation of yerba maté, a plant that yields a stimulating beverage that soon became popular not only in Paraguay but also in the Río de la Plata region. In Brazil a biethnic society could not emerge because of the persistence of Indian slavery—it had been suppressed in Spanish America by the 1550s—and because the unification of the Spanish and Portuguese crowns did not manage to change the political and legal systems that were already in place in Portugal and Brazil. Actually, the idea of a biethnic society turned out to be impossible in areas where the Indians predominated. Instead, a spontaneous reorganization gave rise to a multiethnic society. As the natural outcome of a historical process, rather than a political or cultural program, this society was based on numerous exclusionary elements and on asymmetrical—that is, unequal—race relations. It resulted from marginalizing the mixed bloods, or castas: the mestizos (born of a white and an Indian), mulattos (born of a white and a black), and zambos (born of an Indian and a black), for whom only partial integration was possible and then only through clientelism. In the sixteenth and seventeenth centuries many mixed bloods would turn to Iberian notables for protection and receive from them advances in goods or, less often, in cash. This custom engendered forms of servitude that would increase in the next century. The mixed bloods who refused this dependent status were free to The Search for New Connections

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go and colonize the wilderness, exploiting its wealth of resources, sometimes even founding villages, or they could move to cities or mining settlements. Mobility was possible because antivagrant laws were almost nonexistent in the Americas, unlike in Spain and Portugal. Although the spontaneity and unique traits of the American population prevented European social stratification from taking hold completely, old and new prejudices about skin color excluded mestizos and mulattos from the rank of “pure bloods,” or legitimate offspring—the standard required for admittance to seminaries, universities, the army, the royal administration, and even trade or craft guilds. As American society was beginning to adopt Iberian parameters, one of its unique features was becoming visible: the conflict between economic and social criteria, on the one hand, and ethnicity and race on the other, prevented it from adhering to the categories of monoethnic hierarchies that prevailed in Europe at the time. This was not altogether negative, for it also enabled American societies to distinguish themselves from those of the mother countries and afforded much greater social mobility to Americans. All along, the newly formed guild-based entities needed to establish relations with the monarchy. These relations were patterned on the contractual terms of the time: subjects enter into a covenant with the king, who grants them rights and privileges in exchange for their fealty. The covenant sets forth whether the lawmaking power pertains exclusively to the king, to the Cortes, or to the king jointly with an assembly of the estates. While in the peninsula this power belonged solely to the king and the Cortes until the sixteenth century, in America it was the exclusive prerogative of the king. However, the municipal councils of the viceregal and gubernatorial capitals had the right to represent the realm, and as such they could submit complaints, petitions, and supplications to the monarch through deputies to the royal court. In the sixteenth century the number of Spanish municipalities in the Americas grew to form, along with thousands of Indian municipalities, a veritable network that linked each village with both the Ibero-American and metropolitan courts. To understand the importance of the municipalities and their governing boards, the municipal councils, suffice it to say that one of their tasks was to organize obeisance and fealty ceremonies in honor of the king and the Catholic Church in each locality, in which all subjects collectively took an oath before the royal standard. They also organized receptions welcoming the king’s representatives, the viceroy, and the governor. Thus, the municipal governments were responsible not only for the political administration of the territory but also for the preservation and 48

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symbolic reproduction of the covenant binding the American “subjects” to their king. The tension between king and subjects found expression in forms of cooperation as well as conflict but also in mediation arrangements, such as the appointment of municipal deputies to the royal and viceregal courts. The cabildos of Mexico City and Lima sent permanent deputies to the court of Madrid; the same was true of the Brazilian capitals of the wealthier captaincies. As this type of geographic representation multiplied, the municipal councils secured from the king the right to send their deputies without first gaining authorization from royal officials. This right also extended to the Indian municipal councils, those of New Spain especially, as is evident in the many petitions that the deputies of the Indian cabildos sent to the viceregal authorities. The ability of the municipal councils to establish relations with the colonial and metropolitan courts explains why an indirect type of government flourished in the seventeenth century. The municipal councils were like branches that enabled the central colonial authorities (viceroys, governors, royal tribunals, and royal treasury) to control the various American regions without the presence of royal officials or an army. The municipalities were entrusted with broad local powers, including the administration of justice. They returned the trust with unfailing loyalty to the Church, the king, and royal dignitaries. Without their active participation the colonial covenant could not have been enforced: evidence of its effectiveness is the almost total lack of Spanish, mestizo, or Indian rebellions in this long period. Local power also grew thanks to the buying and selling of offices, a trend that took hold when the financial crisis struck the Iberian monarchies from the end of the sixteenth century to the first decade of the seventeenth. As a result, the power of local notables in the municipal councils of Spanish America became more entrenched; in Portuguese America financial and legal posts were the ones most affected. These expanded local powers came at the expense of the royal commissioner (corregidor), who, unlike his counterpart in Castile, had no effective oversight, for here he was not a royal dignitary but a private individual whose client-patron relationship to the viceroy or the governor had secured him a trading license in the district. Most royal commissioners in America had no legal training and were mostly Spaniards or Creoles (American-born Spaniards) more interested in acquiring wealth from the office than in building a career in the royal administration. In Brazil the municipal governments (câmaras municipais) acquired even more influence than their Spanish counterparts. Existing alongside the royal The Search for New Connections

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jurisdictions were the seigniorial ones; the latter increased from nine in 1550 to ten in 1600 and thirteen in 1650, whereas the number of royal captaincies stood unchanged at six in 1650. This explains why, with the king lacking oversight of the seigniories, the municipal governments became the monopoly of local notables, the only class that could fight the power of the donatários. The attempt to introduce the posts of royal commissioner (corregedor) and justice of the peace (juiz de fora) in Brazil would meet with little success because, as in Spanish America, they were not salaried officials appointed by the king. Because the municipal councils could interpret the king’s will and counteract the power of the royal officials, the latter’s real function was one of oversight, not direct control. Although such indirect rule had objective limitations, the viceroys, and all the royal dignitaries in general, were invested with a high symbolic aura. The Hapsburg monarchy, in Spain as well as the Americas, projected a strong, austere image intended to inspire reverence and fear. The elaborate installation ceremonies for viceroys, governors, judges, and tax officials reinforced this image, helping to tame the various dominions. The political and administrative organization of Spanish and Portuguese America reveals a remarkable distance between the kingdom—as managed by the municipal councils—and the viceroy, governors, and other royal representatives, given the absence of a genuine intermediate body of royal officials at the local level. Without the hierarchy of royal officials to transmit orders from the peninsula, the implementation of these orders—which theoretically both the municipal councils and the royal officials in place were bound to follow—took forms so diverse that they sometimes amounted to suspension of the order. The institution of governors (in Portuguese America) or viceroys (in Spanish America), the royal court of justice (Real Audiencia), and the royal revenue office (Real Hacienda) improved communication between the royal authorities in America and their peninsular superiors; still, the viceroy or the governor, as president of the Real Audiencia and the Real Hacienda, reigned supreme. The entire bureaucracy reported to the Council of the Indies, which, in turn, reviewed issues and submitted political, military, defense, and administrative solutions to the king and his secretaries. Concentrated geographically in Brazil, the Portuguese dominions were likewise divided into seigniories and royal captaincies. The seigniories covered most of the Brazilian territory: of the thirteen in 1650, eleven were held by Portugal (Itanhaém, São Vicente, Espírito Santo, Porto Seguro, Ilhéus, Paraguaçu, Itaparica, Cumã, Cametá, Cabo do Norte, and Caeté), and two were Dutch (Sergipe and Itamaracá). There were only eight royal cap50

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taincies: two (Paraíba and Rio Grande) were under Dutch rule, while the others—Rio de Janeiro, Bahia, Pernambuco, Ceará, Maranhão, and Pará— remained under Portugal. While the seigniories had locally elected judges and authorities appointed by the donatários, the three captaincies general of Bahia, Pernambuco, and Rio de Janeiro came under a governor general in Bahia; the captaincies of Maranhão, Pará, and Ceará under a governor in Maranhão. Throughout the seventeenth century the governors general had merely nominal power; thus the captaincies enjoyed an autonomy similar to that of the seigniories. Like their Spanish counterparts, the Portuguese captains general and governors had military, administrative, financial, and judicial responsibilities. However, they had only one supreme court of justice, the Relação de Bahia, and the captaincies general had a top judge who reported to the supreme metropolitan court of justice, the Casa de Suplicação. The Concelho Ultramarino and the Concelho de Fazenda (the latter charged only with financial matters) were the two metropolitan bodies that advised the king and his overseas secretary. By the middle of the seventeenth century, all the American regions under the Iberian monarchies had achieved a significant transformation that had led to their inclusion in the general organization of the monarchies at all levels. By 1650 all the ethnic and racial groups, from the lowest to the highest on the social scale, had absorbed, albeit to different degrees, Iberian values. The New World had undergone the first significant Westernization of its economy, society, politics, and culture.

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T wo

The Ibero-American World

The first Western traits adopted by people on the American continent in the seventeenth and eighteenth centuries were Iberian. The Westernization consisted of adapting and redefining tools, such as those pertaining to the economy and social life, and symbolic ones pertaining to religion, language, and culture. The interpretation of European forms was the work not just of Indians, mestizos, and mulattos but of the Spanish and Portuguese settlers as well. All adapted the European forms to the specific American context, taking into account their own cultural background, their new needs, the wild state of nature, and the reduced demographic density. In this refounding of America the Iberian elements were visible in the religious rituals, the writing and speaking of Castilian Spanish and Portuguese, and the institutions created by both settlers and Indians. The preeminence of Iberian forms did not prevent the penetration of other European, African, or even Asian elements, as evidenced by nutrition, crafts, medical practices, Catholic syncretism, common law, and, more generally, in a new relationship between people and nature. The relative ease with which the American territories entered the Western sphere resulted from the population’s ability to build a worldview that, while not opposed to that of the peninsula, took on specific different and original characteristics. In fact, the Ibero-American communities soon developed a unique American identity that set them apart from their Iberian counter52

parts. In contrast, the English settlers in North America in the eighteenth century still considered themselves English subjects who worked and lived overseas. This first Westernization of the subcontinent was facilitated by its being part of the Spanish Empire, which allowed all realms and provinces, in Europe as well as America, to keep their own languages, cultures, and institutions while recognizing the king’s preeminence and that of the Catholic religion and the metropolitan institutions. This flexibility gave the American regions great autonomy. The relatively small number of Spaniards and Portuguese in America helped to strengthen this autonomy, as it was imperative for the settlers to have the cooperation of the Indians and, later, of the mestizos and mulattos. The complex process of the mixing of races and cultures, the subject of this chapter, would lead to exchanges of symbols, cultures, and forms of organization and socialization that would help fashion today’s Latin American pluralism.

T h e I n t e r nat iona l Con t e x t

State Sovereignty and Iberian Decline Beginning in the mid-seventeenth century, the Ibero-American regions had become integrated into an international context that was to see significant change in the Iberian monarchies, including their decline. Between 1650 and 1700 the reforms promoted by politicians and officials on both sides of the Atlantic had failed to materialize, and this hurt the development of the Ibero-American regions. In the latter part of the eighteenth century, the reforms introduced by the Bourbon monarchy and the Portuguese prime minister created a fertile bed for a monarchical crisis. These reforms included attempts to centralize Iberian control of the American colonies. On the peninsula, during the seventeenth century and until the rise of the Bourbons at the beginning of the eighteenth, a maximalist defense of the religious foundation and of the composite nature of the monarchy checked any tendencies toward absolutism; it also slowed adoption of the changes pursuant to the treaties of Westphalia (1648). The sclerotic nature of the Spanish and Portuguese monarchies was especially noticeable in their failure to build an administration that could effectively counter the dispersive forces of the local elites and the sheer geographic distance and channel them more productively to fulfill the new needs of commercial expansion. T h e I n t e r n at i o n a l C o n t e x t

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Like other great powers that cease to be such, the Iberian monarchies probably did not immediately perceive the end of their preeminence because they paid scant attention to the principle of cuius regio, eius religio sanctioned in the treaties of Westphalia, which gave any Christian denomination—not just Catholicism and Lutheranism—full political legitimacy if the monarch belonged to that denomination. Thus the old supremacy of the Holy Roman Empire gradually became merely symbolic and ceremonial, until it was reduced to a mere regional power, a reference point for the many German, Austrian, and Bohemian states and city-states. The progressive loss of rank of the Holy Roman Empire led to the idea that Europe was a composite of many sovereign states and that no state acknowledged its subjection to other states. In other words, each state had full sovereignty over its territory and in regard to other states and so was the sole arbiter of its own interests. Thus sovereignty became synonymous with a power that recognized no other power above itself, and each state now had to defend its independence from foreign threats. Unlike the concept of empire, the new idea of sovereignty called forth the image of a plurality of states always on the warpath. Still, after a war-ridden seventeenth century, the new century was less conflictual: for one, the Treaty of Utrecht (1713) affirmed the idea that peace in Christendom was the primary objective of a Europe that was now being defined as a system of states. To reach a state of peace, the Christian world needed stability and order through a proper balance of power that, according to a document of the time, was to be “the best foundation of mutual friendship and of a long-lasting general harmony.” All European nations adopted the principle of the balance of power; its shared roots were membership in Christendom and the dynastic principle that legitimized the reigning monarchs based on their ability to defend the state from internal as well as external threats. Thus sovereignty was not an abstract notion but one that was closely linked with the monarchy, which is why I call this first form of sovereignty dynastic. Dynastic sovereignty, also a principle of aristocratic republics such as Venice or the Netherlands, promoted alliances between monarchs, through peace or friendship treaties or through marriage, the latter producing interrelations between several royal houses. In the eighteenth century, the rapid waning of religious discrimination turned the old politicoreligious conflicts into politicoeconomic ones. In this significant transition the Ibero-American regions, and in particular their riches, became an important resource that attracted competition as every 54

The Ibero-American World

European power tried to seize large shares of the international trade, because it yielded the highest profits and could better fatten the royal treasuries. The progressive secularization of societies and kingdoms, and the greater weight that the mercantile interests came to acquire, gradually spread to all of Europe. Spain and Portugal followed the new trend and tried to bridge the gap that had materialized, but it was a slow process, hindered by the preeminence that the two monarchies (they separated again in 1640) assigned to the upper nobility in filling public posts. Following the European trend, Spain and Portugal also were entrusting the management of the country more and more to state secretaries. Until the 1750s Portugal and Spain, unlike the rest of Europe, had not expanded their military and naval forces for more than a century. And until about 1730 both countries had failed to develop their civil service and financial bureaucracies, despite the reforms suggested by skilled state secretaries and councillors. In Spain the reforms of Count-Duke Olivares (1622–43) put an end to the Spanish-Portuguese union and caused a backlash of antiSpanish rebellions in Catalonia, Flanders, and Naples. As a result the Spanish kingdom was constantly torn by centrifugal forces, both in Europe and in America. Spain’s decline is also visible in the recurring financial crises caused by its unwillingness, especially after 1640, to come to terms with its diminished international role. As late as 1663, while in the throes of a deep financial crisis, the king was still attempting to bring Portugal under his rule again, but Portugal would defeat the Spanish army, thanks to French and English support. In addition to its military weakness, Spain was unable to manage its resources because of its inefficient organization: of the twenty-seven million ducats—the average annual royal revenues in the 1650s—owed the treasury, it received only six million; twenty-one million went to pay off money that the king had borrowed from private trading houses. The weakness of Spain was also evident in America, where the king was unable to force the other European powers to acknowledge his commercial monopoly. As a result Spain’s trade with its own American colonies was shrinking, and the American riches, bullion in particular, landed directly in Amsterdam, Paris, and London without even passing through Spain. Interference in the Iberian “closed sea” was strongly felt with the arrival of the Dutch. Holland was so strong that only the refusal of the Amsterdam States General prevented Oliver Cromwell from going forward with his plan to seize and divide the Ibero-American colonies between Protestant T h e I n t e r n at i o n a l C o n t e x t

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England and Holland. In fact, from 1635 to 1654 Holland occupied Paraíba and Recife in Brazil, as well as São Luís do Maranhão from 1641 to 1644, in addition to seizing the islands of Curaçao, Saint Martin, and Saint Eustatius, which were crucial to the commercial routes. Thanks to their presence in the Antilles, even after they were routed from Brazil, the Dutch continued to control about half the Brazilian sugar exports, a large part of American tobacco exports, and practically the entire black slave trade. They also controlled a large percentage of Potosí and Mexican silver via contraband, as well as the black slave trade in the Antilles and in Río de la Plata. Luso-Brazilian notables provided decisive help in expelling the Dutch from Brazil, but this did not deter other European powers from penetrating the New World. France and Great Britain looked to the Antilles because of their strategic location along the silver routes, for the three ports of call for the Spanish fleet in the silver trade were Portobelo, Havana, and Veracruz, all in the Caribbean. The Dutch, French, and English were all active in illegal trade through privateering and piracy. While pirates acted outside the law, privateers had royal charters or official permits to attack and plunder enemy ships. Many non-Iberian European outposts and entrepôts were established on the former Spanish possessions, for Spain’s competitors succeeded in opening up the American “Mediterranean”—the Caribbean Sea—and flooding it with goods and slaves; the competitors also had political and strategic goals in the region. All this falls within the larger framework of colonial expansion and can be understood only in light of the concurrent decline of the Iberian monarchies in the same period.

The Renewal of the Iberian Monarchies With the new century the Iberian monarchies accelerated their adaptation to the changed European context. With the ascension to the throne of Philip V, a Bourbon, the Spanish monarchy tried to bridge the gap. Reforms strengthened the power of the state secretaries over the existing councils, did away with the sale of offices, and eliminated royal grants and the subcontracting of public rents. The king also began to supervise the municipal councils through a new administrative division and a reorganization of civil servants, appointing prefects (intendentes), vice prefects (subdelegados), and tax officers. The control of local authorities, abolition of privileges for the nobility and the clergy, and institutionalization of military authority promoted the subjects’ fiscal equality and made oversight of the military possible. The diffusion on the peninsula of cameralist principles is clear in the selfcharacterization of both the Bourbon and Braganza monarchies: each king 56

The Ibero-American World

saw himself as an absolute ruler surrounded by a court of advisers who would become experts in their field; teams of officials would ensure local oversight. The kings limited the special rights and privileges of towns such as the fueros and of autonomous regions such as Navarra and the Basque area by applying blanket rules to all the realms. In Spain the reforms accelerated under Charles III (1759–88), who more strictly regulated the economy and applied the reforms to America. Charles III understood that the only way to keep his country a major player in the system of states was to strengthen and extend its presence in the New World. This was one outcome of the Peace of Aix-la-Chapelle (1748), for that was when overseas possessions began to count in the balance of power, with a view to preventing any one European monarchy from becoming hegemonic. The Portuguese monarchy followed suit, especially under John V (1706– 50): he diminished the political role of the nobility, expanded the bureaucracy, and reformed financial policies with a view to maximizing royal revenues. His successor, Joseph I (1750–77), achieved broad reforms through the work of his prime minister, the marquis of Pombal. In just a few years, 1751 to 1777, the marquis diminished the power of the Church, expanded the role of the royal bureaucracy, reduced the ranks of the upper nobility in the administrative and military departments, and offered financial subsidies to the merchant class. Pombal’s reforms also applied to Portuguese America in recognition of its economic, political, and strategic importance. These policies would remain even after Pombal fell from power, for in 1790 the crown eliminated the surviving feudal privileges altogether and modernized the old seventeenthcentury legislation. After the protracted Spanish War of Succession (1701–13), but especially after the Treaty of Aix-la-Chapelle (1748) and the Seven Years’ War (1756–63), the European monarchies had come to accept the idea that in the new system, the sovereignty of the states had to be preserved by reinforcing the military and reassessing their naval forces. The fact that the Seven Years’ War was also fought in America had made it clear that overseas possessions ought to contribute more to the monarchy’s increased military, naval, and administrative expenses both at home and abroad. The reorganization of the empires of Portugal, Spain, France, and Great Britain—all had possessions in the New World—strived to centralize the administrative, military, and financial functions in the hands of viceroys, governors, captains general, and prefects appointed by the king and empowered to make quick executive decisions. Formerly, officials had been required T h e I n t e r n at i o n a l C o n t e x t

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to consult with the various councils. In English America this reorganization led to strained relations between the old representative bodies—the councils made up of landowning settlers—and the new royal officials with executive power and would eventually lead to war. The broad autonomy enjoyed by the American landowning classes could thwart any attempt to centralize power in the hands of the officials who reported exclusively to the royally appointed governor. The first monarchy that tried to quickly implement a political and financial restructuring of its American possessions—the thirteen colonies—was Great Britain, but it met with growing opposition starting in the 1750s. The new colonial policy not only hurt the economic interests of the colonists but subverted the constitutional principles on which the colonies had been founded and had governed themselves. This chain of political, financial, and constitutional interests would bring about the American Revolution in 1776. The reorganization of the British Empire’s Caribbean possessions was more successful. There, the English settlers asked their king for greater assistance against the ever-present French and Spanish military threat and did not complain when he raised their taxes to help defend the islands; after the 1783 Treaty of Versailles, British settlers in the Caribbean enjoyed unrestricted trade as the English crown lifted the restrictions of the Acts of Navigation. Among the more significant effects of the new policy was the legalization of trade between the English Antilles and Spanish America. Great Britain also granted to the English Caribbean settlers greater control over slaves and black and mixed-race freemen, something that the settlers appreciated because they did not trust the slaves, and the “colored” population in general, to be loyal. Their doubts were also felt in Iberian America, Brazil in particular, and turned out to be justified when in 1791 the slaves in the French part of the island of Santo Domingo (now Hispaniola) rebelled, leading to the creation in 1804 of Haiti, the second American republic after the United States. In many ways the experience of the Spanish and Portuguese monarchies was not unlike that of the English: The Iberian kings also had met with obstacles when trying to combine centralization of the colonial administration with reforms designed to generate more revenue for the peninsula. The Creole notables fought the reforms because they considered them an attempt to reduce their own multiple privileges, and in fact the monarchies tried to break the informal covenant they had with the local elites since, thanks to the broad powers the crowns had granted them, the Creoles collected the tributes owed to their office and used their position to strengthen their own client network at the local and regional level. 58

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The reforms that Spain wanted to bring to Spanish America were broadly the same ones it implemented at home: centralizing the role of government; professionalizing the administrators, tax officials, and the military; and modernizing procedures to ensure obedience to the king’s commands. To reach these goals Spain outlawed the sale of local and district offices and the subcontracting of the collection of customs duties and other taxes from the local merchant guilds and potentates. At the same time a true royal corps of officials came into being for the colonies, modeled on the French prefect system but without professionalizing the vice prefects, who continued to be drawn from the local elites. Furthermore, the corporatist roles of the cabildos were shrunk and new ones were created. Spain also inaugurated a sweeping reform of defense, requiring the reorganization of the local militias and extending the draft to mestizos and mulattos. In addition to these innovations, the crown strengthened its hold on the territory by creating a new department of the government of the West Indies, carving out the new vice realms of Río de la Plata and New Granada (Colombia) and appointing royal commissioners with executive power. Trade reforms were also important in that they opened the major American ports to trade with all the Spanish ports. This important change eliminated the centuries-old privileges enjoyed by Seville and Cádiz and allowed all the Spanish metropolitan provinces to trade directly with the Americas. These reforms were an effort to bypass the indirect government that had become consolidated in America from the end of the sixteenth century to the first half of the seventeenth century. The Bourbon king wanted to standardize the governments of the metropolitan districts and the colonies, thus changing the old composite, multiterritorial Hapsburg monarchy into an absolute one. In other words, absolutism reached Spanish America only after 1750 because it appeared late in Spain, and because of the hostility shown by the Creole elites, since it was designed to reduce their freedoms and privileges. The Portuguese crown introduced similar reforms in Brazil: the seigniories began to disappear into the four captaincies general of Pernambuco (which included Ceará, Rio Grande do Norte, Paraíba, and Alagoas), Bahia (with Sergipe, Ilheus, and Porto Seguro), Rio de Janeiro (which included Espírito Santo, Rio Grande do Sul, and Santa Catarina), and São Paulo (including Minas Gerais, Mato Grosso, and Goiás), which formed the viceroyalty of Brazil, with Rio de Janeiro as its capital (1751). Although the opposition of the captains general hindered the expansion of the authority of the viceroy, in 1763 the Portuguese king began nonetheless to try to centralize the T h e I n t e r n at i o n a l C o n t e x t

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administration of justice and the royal treasury, in addition to organizing and professionalizing the municipalities and the militias. He also placed the militias under the authority of career officers. The major difference in the containment and reform policies enacted by Spain and Portugal pertained to trade: while Spain adopted a policy that opened the Americas to merchants from all parts of the kingdom, Portugal established companies with special privileges, such as those set up in 1755 for Grão Pará and Maranhão and in 1759 for Pernambuco and Paraíba; like the earlier companies, they were set up as trading monopolies of the principal colonial commodities. Relations between Brazil and Portugal were governed by the same principles as those between Spanish America and Spain. Seeking more uniformity on both sides of the Atlantic led to policies that extended royal absolutism to Brazil as well. Such absolutist policies were met with resistance at home but even more so in the Brazilian territories, which already enjoyed what we might call an ancient “colonial” type of freedom that allowed them (and the Spanish colonies) to liberally interpret the law. Colonial freedom was in fact the form that colonization took in the New World.

T h e Com pon e n ts of t h e I be ro -A m e r ic a n Wor l d

Mixed-Race Unions, Territoriality, and Stratified Societies The other European powers competed to seize American territories to create colonies and outposts and to join in the transatlantic trade and get hold of the slave market. Spain and Portugal reacted by defending their empires, because the overseas colonies had become increasingly important in the seventeenth and eighteenth centuries in defining a state’s political power in Europe. Simply put, from 1787 to 1811 the Spanish colonies had directly contributed 174 million reales a year to the royal treasury, the equivalent of 28 percent of Spain’s total revenues; the total would have been higher if it included all the military, political, and administrative reform expenses paid for directly in America. Brazil’s contribution to the Portuguese monarchy was 8 percent of the gross domestic product of Portugal; its contribution to the treasury was similar to Spain’s, accounting for about 30 percent of total revenues. Given the size of Portugal, it was obvious that Brazil was a vital part of the Portuguese monarchy, just as the many American viceroyalties and governorates were for Spain. The increasing significance of the Americas in the international context 60

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was not simply due to changed power relations in Europe: the sizable growth of their economies and population was also a factor, as was the growth of a dynamic society with powerful local elites who had clearly defined interests and a culture capable of absorbing and integrating the innovations coming from Europe. In short, this was the historical phase in which the Latin America of today was born. One important change in the New World was renewed demographic growth; although the data are not very reliable, population growth probably began in the early seventeenth century; by the second half of the eighteenth century it had possibly reached 1.2 to 1.5 percent, a rate that would hold steady until about 1850. The rate was higher than that of many parts of Europe—in some places even double—and much higher than the 0.15 percent of Spain and Portugal. The main reason for this greater growth in Ibero-America was the relative ease with which common people could meet their basic needs, whether in urban or rural areas, thanks to the availability of land and the constant demand for labor (witness the importation of slaves to remedy the shortage). The existence of vast natural resources that could be exploited was not a fact just of Anglo-Saxon America but of all the Ibero-American territories. The growth rate of the various racial and ethnic groups varied greatly: it was low for the black slaves but rather high for the mostly white elites. The new mixed-blood group of mestizos, mulattos, and those considered “white” had the highest rate of growth, higher than those of the Indians and the black slaves. The low growth rate of the black population was at least partially the result of their oppressive labor conditions and their enslavement, while for the Indians a combination of factors, from labor conditions to the marriage and sex customs of each community, characterized by tight social controls, held the growth in check. In contrast, social mores were looser in the mixed-race groups, as evidenced by the low rate of illegitimate children in the Indian communities and the extremely high rate in the mestizo and mulatto villages. Therefore the high rate of illegitimacy was a specific feature of Latin America, the result of the small number of marriages in a society with loose social controls and the high cost of parish fees. While family life was tightly controlled in the Ibero-American and Indian communities, that was not the case for the mixed-race population. This vitality of the new American people lay in their strengthened gene pool, a mix of black, white, and Indian heritage, unique in the world. Even with the low birthrates of the black slaves and the Indians, the overall population continued to grow in Latin America. Despite the lack of reliable Components of the Ibero-American World

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data (mixed-race people would begin to be counted only after independence), we can rule out certain factors. The growth cannot be ascribed to Iberian immigration, which never exceeded five thousand individuals a year between 1650 and 1800, nor to the importation of slaves, which held steady in the same period at about four thousand a year in the Spanish territories and eleven thousand in Brazil. It follows that the robust growth was that of the mixed-race population, which around 1800 constituted 19 percent of the total population of Spanish America and 28 percent of Brazil’s. On the other hand, focusing on race requires analysis of the different concepts underlying its definition. The data are particularly interesting because they reveal that social and economic rank could condition the racial definition of an individual. The number of Spaniards and black slaves who arrived on the subcontinent every year does not explain the population explosion; a large number of people defined as white also lived on the haciendas and in the farming villages, and few blacks lived in the cities—black probably meant “slave” in some areas (but not in Brazil, where the main distinction in the black-mulatto population was between slave and freeman). The mixed bloods were concentrated in the cities and the mining towns, but their numbers still were much lower than the population defined as white, probably because many whites were in reality mestizo-whites, not so much from the racial as from the social point of view. Like all European ancien régime societies, the Ibero-American societies were founded on socially recognized family values. In fact, one of the more significant features of these societies was reputation, meaning the regard in which a community held some of its families and their members. Reputation, or regard, was a function of wealth, of course, but also of the prestige and honor the individual enjoyed in the community. In both Spanish and Portuguese America only the notables were well regarded in their community and given the rank of vecino (Spanish) or vizinho (Portuguese) based on their honesty and the respect they enjoyed but also the services they might have rendered to the community through public office or activity in brotherhoods. Obviously, once a mestizo or a mulatto began to be held in high regard, he would be considered white. Based on this custom the authorities began to authorize the official definition of some mulattos and mestizos as white. Because American multiracial societies were stratified, assigning a legal status to the mixed bloods was problematic. In fact, the social order to which the conquest gave rise acknowledged only whites and native Indians. The latter, as I discussed in chapter 1, were subject to different rights and obligations. In addition to having an ambiguous status, the new mixed bloods 62

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also suffered from the prejudice of illegitimacy, since bastard children were excluded from the clergy, barred from school, and not permitted to join trade or craft guilds. Since social rank was so important, the mixed bloods strived for social status. Many eighteenth-century officials commented that one aspiration of small merchants in the colonies was to become a militia officer. Baron von Humboldt, an acute observer of Latin America in the late colonial period, even wrote that he had seen a shopkeeper in a Mexican town serve his customers while dressed in a militia officer’s uniform. The desire of the mixed bloods to belong to guilds or corporations (trade guilds) reflects the hierarchical conception of society; in this period the rank or guild to which one belonged defined one’s identity. In Ibero-America one mechanism that eased the entry of the mixed bloods in society was the reorganization of the urban and rural militia that the crown promoted to improve population control and create a defense against invasions by other European powers. The reorganization of the militia attracted the lower classes, which had no status, for a militiaman had privileges such as exemption from taxes and from forced labor drafts for public works. Joining the militia allowed a man to become a resident, a vecino, and to be eligible for municipal office or at least justice of the peace or local chief of police. Not only members of the lower classes sought these privileges: so did merchants, miners, government officials, officers, and even university professors. Each member of a corporation, including the regular clergy, asserted specific rights and duties. Around the end of the eighteenth century, in any Latin American colonial capital the buildings of the merchants’ guild (Tribunal del Consulado), the miners’ guild (Tribunal de Minería), and those of universities and municipalities rose next to such public buildings as the governor’s office, the court, customs house, bank, and cathedral. The growth of the guilds, both the established ones and the de facto ones, probably helps explain why absolutism met with so many obstacles in America, where a type of “colonial,” or informal, freedom had taken root. The growth of corporatism explains the penetration of America by European class concepts, a phenomenon visible in the growth of clientelism. The stately homes of the Creole elites also housed relatives, servants, slaves, and high-ranking dependents. Usually, shops that sold the products of the patriarch’s business were located near the main entrance, for in addition to a town house, he often owned farming land and mines or was engaged in trade, manufacture, or one of the liberal professions. Components of the Ibero-American World

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A survey of the thirty-three leading notables of Puebla, Mexico, around 1780 reports that in addition to his main activity, each notable had two more. Thus each notable had quite a large number of dependents or clients—the individuals and their families bound to him politically, as employees, out of loyalty, or because of blood ties (illegitimate children). The existence of client networks shows that many tried to come under the protection of a notable, thus enjoying indirectly the privileges that a guild or corporation offered its members and their dependents. A quick count of the number of clients who indirectly enjoyed the privileges of wealthy merchants who had joined the Consulado guild of Buenos Aires shows on average eleven individuals per member. Thus the 132 merchants of the Tribunal del Consulado controlled 1,652 people, or 7 percent of the total city population in 1778. Personal ties, for the most part informal and not regulated by legal status, were very strong on the large haciendas and in the mines, where labor indebtedness existed alongside other forms of coercion. The indebtedness also worked in reverse when the owner owed goods or cash to his peons, sharecroppers, or day laborers. The result was that new social figures continued to emerge because of changes in production or in the organization of labor not only on the latifundios but also on large farms and livestock ranches, as well as communal lands. At the same time stratified relations within the elite class developed. Because each patriarch had at least a second activity, such as interest in a mine, a merchant business, or a law office, he inevitably became the center of a network with an army of intermediate dependents; some were blood relatives whom he made managers and supervisors. Thus economic activity grouped individuals of different ethnicities and social rank in a stratified organization that undoubtedly restricted their economic freedom but also offered the protection that is usually offered to a client. The resulting image of Latin American colonial society is not the familiar one, with few leaders and many subjects, but rather one with many mediating figures such that even the landless laborer (the peón), even before his relationship of dependency to the notable, is in an unequal relationship with the foreman, supervisor, or middle-level steward. Nor was it customary for the mixed blood or Indian who had fled his village to immediately receive advance goods or money for his work sufficient to turn him into a subordinate, indebted employee. The advance was given only when the laborer had shown some rudimentary skills or merit; in fact, other, less onerous ways of creating bonds of servitude existed, such as renting out land to farm or in exchange for workdays, or sharecropping or tenant farming. All these were 64

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informal arrangements without written contracts. Although working conditions, including those of household servants, were generally oppressive, they were partially mitigated by the many forms of paternalism, in the city as well as the country. Descriptions of life in the mining regions of Mexico, Chile, and Brazil offer glimpses of a provincial life not unlike that exalted by eighteenth-century English novels. The upper class led a pampered life primarily in the cities, but it would be wrong to presume that the wealthy made an effort at luxury for its own sake. The display of pomp had it own reasons, for in a colonial society without a real titled nobility, status was in large part defined by lifestyle and by the number of clients a family had. In fact, with the exceptions of the marquisate of Valle, which was held by the descendants of Cortés, and the Portuguese seigniories in Brazil, which began to disappear after the 1750s, the American nobility might have had titles but lacked the privileges enjoyed by the Spanish and Portuguese grand aristocracy. Ibero-American aristocracy was exclusive: Spain assigned 422 titles to Spanish America in the seventeenth century and 409 in the eighteenth century, but none carried jurisdictions or privileges; therefore the mechanisms of aristocratic reproduction were essentially social mechanisms supported by wealth. One significant privilege was primogeniture (mayorazgo), granted by the king to a notable family that had proved to be pure blooded and had consolidated wealth; this privilege allowed the eldest son to inherit most of the family property, one way of preventing the excessive fragmentation of wealth, and led to a division of roles in the great families. Another such mechanism, although it was informal, was marriage: it helped elite families build a social network and favored a balanced redistribution of wealth, prestige, and honor among them, for a notable could, through marriage, exchange his prestige as the descendant of a conquistador for the wealth of a merchant family or the prestige of the legal or medical profession for that of a royal dignitary.

Economic Transformations Outside the older established areas that lay along the commercial routes were makeshift settlements scattered in recently colonized regions that nevertheless were linked to the established towns. There a situation prevailed that was not unlike that in eastern Europe at the time: links of dependency were more tenuous than in the other settled areas because the reduced availability of labor afforded the (mostly nonwhite) worker more freedom and mobility and more favorable working and living conditions. In addition to witnessing the enormous capacity for new or Components of the Ibero-American World

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increased production, the recently settled areas scattered throughout the subcontinent mitigated the exploitation of workers in the older settled regions, for when oppression became unbearable, the workers simply ran away, deserting not only the large haciendas, estancias, fundos, and ranchos but also the large manufactories, mines, trade shops, and household service. The families who fled the established towns would move to villages or mining towns but also to newly tamed areas, setting up new farms and livestock ranches. The new arrivals settled on land that had no owner and to which they had neither royal grant nor legal title. The absence of the right of usufruct and its attendant guarantees gave rise to conflicts with the more established areas, for the settlers of this second wave of colonization lacked status in the Ibero-American class system, and local notables claimed the right to control the new territories in order to remedy the chronic labor shortage in the older established areas. Still, the new colonization was made possible by the continuing imbalance between the abundance of natural resources and the lack of labor that characterized the subcontinent. Although the availability of workers began to improve at the end of the seventeenth century, the imbalance continued and even tended to increase in the territories, where Ibero-American farming and mining expanded rapidly. The imbalance also persisted for a long time in the Indian and mestizo areas, which were essentially agricultural, and in the textile industry. The differences in central Mexico, Central America, and the Andean regions of Peru, Ecuador, and Bolivia—as well as in the Colombian llano and even in Chile and Brazil—between Ibero-American and Indian or mestizo production also applied to productivity, for with an equal volume of labor and natural resources, Ibero-American units of production grew more rapidly than those of the Indian and mestizo villages. This does not mean, however, that the productivity of white-owned concerns was necessarily higher, for often the contrary was true. For example, in Indian Oaxaca and Guatemala and in the Andean areas of Ecuador, Peru, and Bolivia, the Indian villages supplemented the production of high-value goods for intercontinental trade—cochineal, indigo, and alpaca wool—by producing lowervalue goods such as textiles and farming products for the local, regional, and interregional markets. The same can be said for the tobacco plantations of mestizos and mulattos in Cuba and for the production of cacao in Venezuela. In regions where Ibero-American production predominated, such as the sugarcane regions of northeastern Brazil, an unusual organization of the space developed that ultimately yielded higher productivity; the most productive plantations were the ingenios, which also had facilities to process sugarcane 66

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into raw sugar, molasses, and alcohol—products that were widely sold locally and elsewhere. Productivity decreased in areas with smaller plantations that employed slave labor and only grew sugarcane to be sold to the ingenios. In a third type of area Ibero-Americans raised livestock, which they sold to the ingenios and the fazendas to feed the slaves and for animal power. Unlike the other areas, livestock ranches employed different sorts of laborers, from day laborers to farmworkers but no slaves; this explains why productivity was not necessarily low, since the ranches were not burdened with the cost of purchasing and feeding slaves. Of all Ibero-American industries, the extraction of precious metals, silver and gold, was by far the most productive. This high unit-price industry employed both free and slave labor, in addition to peonage. While peonage prevailed in the midsize to large mines of Mexico, Peru, and Chile, the small mines of Colombia, and especially the Brazilian gold mines (both alluvial and extractive), mainly used slave and free labor from about 1680 to 1750. Productivity of this industry depended on whether the equipment and semifinished goods required to process the ore into bullion were available on site. Mercury, iron, steel, salt, draft animals, and lumber were the essential needs of this industry; the first three were imported, the animals and lumber produced locally or, like salt, bought on regional or interregional markets. The need to purchase essential materials determined the rate of productivity, because, unlike other industries that used goods made on site, the production costs for mining involved large outlays of cash because some essential goods had to be imported. Broadly speaking, then, the economy of the subcontinent was irregular, given the imbalance between scarce labor and abundant natural resources, with varying rates and areas of productivity. The different production sites were linked by commercial routes that, in the absence of a self-regulating market, carried products for circulation on the internal markets and abroad. These commercial routes developed from a combination of factors: first, the needs of the Iberian and Ibero-American merchant guilds and the fiscal needs of the Iberian monarchies; second, the demand of producers and consumers, both in America and in Europe. This type of exchange gave rise to a managed market, one not subject to the strict laws of supply and demand but one still governed by a market logic. The result was a pricing system organized by type: American farm products were sold locally and regionally; American mining products were sold domestically and in Europe; and so on. The price categories depended on the elasticity of the various local, regional, and international demands. The price of silver was flexible because it reacted Components of the Ibero-American World

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quickly to changes in international trade, while the demand for wheat and corn was less so, because a large percentage of consumers produced those staples for their own consumption, bypassing the market. Map 2 traces the two leading commercial routes in New Spain: one went west to east (Veracruz to Acapulco), the other north to south (Guatemala to Zacatecas and the northern mining centers linked to Mexico City). Spanish South America had a north-south axis (from Panama to Chile) and a westeast one from Potosí to Lima, with extensions from Potosí to Buenos Aires by way of Tucumán and Córdoba. With the creation of the viceroyalty of Río de la Plata with Buenos Aires as its capital in 1776, and with improved transatlantic communication, the South American routes tended to converge in the latter part of the eighteenth century. In Portuguese America at least three routes were active toward the end of the eighteenth century: the first ran from São Paulo to Paraguay and Mato Grosso (the last produced gold from the end of the seventeenth to the late eighteenth century); the second linked Rio de Janeiro with the important farming and gold-mining region of Minas Gerais, and the third linked the coastal industries with production sites in the Pernambuco and Bahia sertão (region). The gap between natural resources and availability of labor tended to correct itself in the eighteenth century as productivity improved, which was less the result of new capital investments than of a better connection of the production sites to the routes that linked the American regions to each other and to the world. The simultaneous existence of a plurality of forms of production resulting from the labor shortage led to differences in productivity in the various areas. Plentiful resources, a continued scarcity of workers, and the gradual adoption of exchange value were thus the main factors in the subcontinent’s economy. As a result the use of draft animals was widespread, even excessive (certainly much more than in Europe); they cost little because they were raised in the wild or feral. Also, silver (and later gold) was processed with the amalgam method, an important technique invented in Latin America that reduced the use of labor and was more efficient than the other methods for processing ore into bullion. These forms of production, and the centrality of commerce that marked the subcontinent’s economy from 1650 to 1800, resulted from the efforts of the new generations, which had little European blood in their veins but had absorbed, re-created, and developed a Western mind-set and culture on American soil. Thus the Europeanization of America was not simply an imposition but the development of a new hybrid culture expressed in the great col68

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ATL AN TIC O CE AN

Havana

Zacatecas Guanajuato Mexico City Acapulco

Veracruz Santiago Cartagena Portobelo Panama City

La Guaira Caracas

Bogotá Popayán Quito Guayaquil Paita

Recife

Piura Lima Callao

Salvador

Cuzco La Paz Potosí

PAC IF IC OC E AN

São Paulo Rio de Janeiro

Salta Tucumán Valparaíso Concepción

Santiago

Córdoba Colonia do Sacramento Buenos Aires

map 2. Ibero-American Commercial Axes

lective endeavor, tangible and intangible, that shaped the New World. While the elites participated in this collective enterprise to increase their wealth, honor, and prestige, the Indians and the new mixed-blood populations sought a path to social status and a way out of clientelism; the informal diffusion of the Spanish and Portuguese languages among the masses is one more indication of spontaneous Europeanization. This geographic and economic dynamism is easier to trace by following the changes in the production and circulation of silver from the end of the sixteenth century to the end of the eighteenth. Components of the Ibero-American World

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The production of silver grew steadily from the 1650s to the 1770s, as did silver trading between the subcontinent and Europe and with the rest of the American continent. As the seventeenth century drew to a close, about two-thirds of all exports from the subcontinent consisted of bullion and the other third of tropical farm products such as sugar, tobacco, cacao, animal by-products (hides and skins), and dyestuffs such as indigo and cochineal. Starting in the 1750s, exportation of farm and animal by-products and dyestuffs increased to the point that bullion as a percentage of total exports decreased, even though the production of silver had expanded enormously. In the same period textiles, clothing, and foodstuffs from Europe dominated the imports to America, destined for the open market. Semifinished goods such as iron, steel, mercury, paper, and lead, which were used in farming, mining, manufacturing, printing, and schools, were also imported. The same map shows how, next to overseas trade, a lesser but still significant trade was carried on between American regions, still linked, however, to the overseas trade. It appears that many products bought and sold in America were registered as “miscellanea” in the overseas trade. In other words, many American goods, before being sent overseas, were traded in the local and regional markets. This was the case for cacao, produced in Venezuela and Ecuador, wheat and wine from Chile, leather and hides from Río de la Plata. Obviously, the list is long and includes, for example, maté produced in Paraguay; it appears in the overseas trade as a medicinal herb, while it was widely used as a tea in Río de la Plata, southern Brazil, and Chile. As to the goods regularly traded on the subcontinent, slaves and mercury were productive assets; silver and gold were precious metals that were also used as currency; all the others were popular consumer goods. In fact, tobacco, cacao, and sugar were consumed throughout the subcontinent, while in Europe they were still luxury goods in the eighteenth century.

Social and Cultural Changes This snapshot shows an accelerated change of pace from the end of the seventeenth to the early eighteenth century; to some extent, therefore, the peninsular policies that I outlined in the first part of this chapter were also a reaction to these transformations, not just to the new European dynamics. American dynamism is visible at the local level from about 1700 to the 1730s, in the new peninsular policies toward the new mixed-blood populations. These policies promoted the founding of new settlements and the acceleration of political and cultural innovations; the growing “Iberianization” of the native-born also contributed to the dynamism. 70

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Driving this expansion of colonization, production, and commerce was a convergence of demographic and social vitality with government and Church efforts. This is especially evident in the new centers of activity, the aldeas— small villages made up of a few families who settled together for social, economic, and defense purposes and made their livelihood through farming, mining, or commerce. Though rudimentary, these centers formed a complex new reality in which the network of production and commerce was interwoven with the social network of family and neighbors, as well as the cultural network of religious rites (communion, confirmation, marriage) and celebrations (whether general or local, such as the Patron Saint’s Day). As the importance of capital cities tended to diminish, an urban network was born that consisted of a capital city and a growing number of secondary cities or towns. Little is known about this phenomenon because the only adequate information that survives is about the settlements that received the legal status of principal city (ciudad) or town (villa) from the royal authorities. In the Antilles from 1750 to 1780 eighteen settlements were granted legal recognition; ten were in Santo Domingo and eight in Cuba. In northern Mexico from 1748 to 1790 twenty-two mining settlements were given the title of ciudad, and in Central America between 1750 and 1800 fifteen new cities were founded. In the same period six settlements were recognized as cities along the coast in New Granada, two in Venezuela, about ten in Chile, and twenty-two in Paraguay. Obviously, these settlements were no more than villages, although they had social and political relevance. The multiplication of small centers was also a phenomenon in Brazil; as in the past most were founded near the coast, though in the 1700s they also began to appear in the hinterland along the leading commercial routes. According to the governor of São Paulo, the policy of founding new cities had the primary goal of garrisoning frontier areas, thus enabling the population to defend itself from foreign invasions. Thus, as in Spanish America, in the Portuguese colonies the secondary cities—those with multiple administrative, political, ecclesiastical, or commercial functions—attracted people. Between 1765 and 1803 Belém’s population went from 6,500 to 12,500; Recife’s, from 7,000 to 25,000; Bahia’s, from 36,000 to 51,000; Rio de Janeiro’s, from 30,000 to 61,000; and São Paulo’s, from 21,000 to 24,500. In these towns, and in the smaller centers as well, intermarriage and social diversification intensified, with many mulattos and free blacks engaged in retail sales, trades, and even some professions. The Spanish-American cities and towns experienced the same process of increasingly mixed ethnicity and demographic growth between 1750 and Components of the Ibero-American World

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1800: in Cuba the population of Havana went from 36,000 to 80,000; the viceregal capital of Mexico City grew from 98,000 to 137,000 residents; and Lima’s population grew from 54,000 to 64,000. The population grew also in the new viceregal capitals of Buenos Aires and Bogotá: the former went from 24,000 to 55,000 residents; the latter, from 20,000 to 30,000. Similarly, the gubernatorial capitals of Santiago de Chile and Caracas grew from 21,000 to 31,000 and from 24,000 to 42,000, respectively. The complexity of urban life in the capital cities pushed the Spanish monarchy to replace the old parish-based division with a new district-based system with police precincts for each district; this was done to control the masses and reduce the influence of the Church on city life, and it shows that the influx of rural people and Indians from their ancestral villages intensified the natural growth of the largest cities. The immigrants were attracted by public and private construction work, household work, and the growth of small trading businesses. With its renewed emphasis on the colonies, the viceregal and gubernatorial capitals, and, on a smaller scale, the prefectorial seats, the monarchy was building new headquarters for the old and the new administrations. To emphasize their presence the kings promoted the new neoclassical architecture to replace the baroque style, which was still fashionable on the subcontinent, although it had been obsolete for some time on the peninsula. The flurry of restoration and new construction drew many architects, including several from Italy. A large number of urban renewal projects, including construction of new aqueducts and roads and the upgrading of ports, were begun between 1750 and the end of the century. Still, the most telling sociological data are not the growth of the major cities but the number of new villages. This was particularly true from 1750 to the early 1800s, when an acceleration in mixed-race unions and the networks of new villages gave rise to new forms of cooperation between families of different ethnicities and races. For one, family ties became more complex, linking the families of neighboring villages and promoting intermediate organizations such as brotherhoods and informal district and village societies. The Church was important in this process: it provided an institutional framework for the brotherhoods; supported the institution of the family, which was threatened by the rapid increase in illegitimacy; and, through the cult of the Virgin and the saints, promoted the intermixing of cultures visible in the popular feasts and in the new forms of folklore, many of which still exist today (they are erroneously thought to have originated during the conquest). This new sociality removed 72

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racial barriers and brought people at the lower ends of society closer together. Spanish and Portuguese became the common languages of all groups, and the new religious practices of the nonwhites, a mix of Catholicism and Indian and African elements, acted as an important social glue. Thanks to these integration mechanisms, the populations that had been defined as vagrant at the beginning of the 1700s now acquired an informal social and juridical standing in the colonial hierarchy. A synthetic way of describing this process is to follow the changes in the classification of individuals. In the 1700s the distinction between heads of household categorized as “domiciled,” “residing,” and “vecino” began to wane; it had vanished by the early 1800s, when everyone but household servants tended to be classified as vecino. (Vecinos, who could be Spanish, Indian, mestizo, or mulatto, were permanent residents and men with a source of income in a town, which gave them social and cultural rank.) The progressive standardization of the status of vecino had a positive effect on the lower classes and fit with the crown’s attempt to convert everyone, irrespective of rank, race, or ethnicity, into a royal subject, thereby abolishing the distinction between Indians and Spaniards that had existed since the conquest. This standardization did not break down colonial corporatism, nor did it create a society organized in economic (income-based) classes. Instead, it added new members to the existing stratification. The upper ranks (merchants, mine owners, officials, military, and clergy) grew as new individuals of “humble” background joined them. This phenomenon was especially visible within the military and the clergy and was made possible by the crown’s restructuring of the army and the militia and by the Church’s expansion of the number of bishoprics from 110 to 160 between 1750 and 1820, as well as its Americanization of the higher Church offices. The Americanization of the Church is significant because it gave more influence to the Creole elites, whose importance grew along with the transformation of the lower classes, members of which by now had become royal subjects and had gained a new status, sealed by their identification as vecinos, by serving in the new urban and rural militia. The growing Americanization of the army and the Church, however, fueled one of the major Creole complaints, especially in Spanish America: that Creoles were being prevented from holding office by a new crown policy to fill posts with Spaniards instead of “Indianos” (American-born Spaniards). By the end of the 1700s only onethird of the oidores (judges) at the audiencias (courts of justice) were Creole, few Creoles had been appointed prefect or regent, and no Creole had ever occupied the governor’s or viceroy’s chair, despite the growth of the state Components of the Ibero-American World

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machine. The preference given to Spaniards from the old country, in contrast with the increasing number of openings for Creoles in the army and the Church, was partly due to the peninsular universities’ new emphasis on training civil servants; they had adapted their curricula to spread the new principles of Bourbon absolutism. In the universities of the subcontinent this reform took place much later, after the American War of Independence against England, when the Spanish crown had begun to look at the SpanishAmerican upper classes as potential secessionists. The fear that Portuguese America might also secede was a factor in the policy of the Portuguese prime minister, the marquis of Pombal, and his successors, starting in 1763. For several decades they acceded to the demands of the local elite by appointing Brazilian-born notables who had studied at the College of Nobles, founded in Portugal in 1766. Still, the distance, vastness of the territory, and power and wealth of Brazil compared with Portugal expanded the power of the notables and increased internal tensions. The Portuguese monarchy began to view them with suspicion, also because the plantation owners of Pernambuco, through the municipal councils of Olinda and Recife, which they controlled, were strenuously opposed to the implementation of the new economic policies, and the marquis of Pombal saw in this opposition a situation parallel to what had transpired in English America. To co-opt the Creoles who opposed the new absolutist policies, the Bourbons, Charles III in particular, began to bestow on them titles of nobility, knighthoods of the orders of Santiago or Alcatrava or more recent orders that he had founded. Of course, anyone who received these insignia was obligated to pay a certain sum into the royal coffers. The number of titles and knighthoods granted suggests that the policy was applied uniformly: the Creoles of New Spain received twenty-three titles of nobility, so that by 1821 fifty-four noble families lived there. Several titles were assigned in Peru as well, bringing the number of noble families there to forty-nine.

New Political Trends and Everyday Life The relative freedom and autonomy enjoyed in Iberian America are one aspect of the new dynamism that resulted from the composite form of the SpanishPortuguese monarchy, but they also were an aspect of the New World’s capacity to adapt to peninsular institutions and governance. One telling expression of this power occurred when the Pernambuco elites expelled the Dutch and returned this important and wealthy Brazilian region, a top sugar producer, to the Portuguese monarchy in 1640; still, the 74

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same elites twenty years later demanded that the Portuguese crown close the royal company that enjoyed exclusive sugar-trading privileges. Later, in Caracas, a 1749 insurrection of Creole magnates put an end to the cacao monopoly in Venezuela enjoyed by the Guipozcoana company. The Indian notables, for their part, relied on the support of the municipal councils that they controlled and succeeded in exacting a reform of the trade monopoly that the royal commissioners, the corregidores, enjoyed in the Indian districts, thus opening the market to competition. One of the more significant examples of this phenomenon in the Spanish colonies is the 1660–61 rebellion of Tehuantepec, Mexico. The nonwhites became skilled at furthering their political interests by using European models: to escape slavery the mulatto and black population found refuge in still-virgin lands where they set up autonomous governments called “palm tree republics” in the tropical regions of Colombia and Venezuela, on the Central American coasts overlooking the Caribbean, and in northeastern Brazil. These settlements of freemen copied the social and political models of Iberian America, with municipalities and social stratification that even included slavery. These examples illustrate the extent to which the Ibero-American magnates and the Indian notables defended and expanded their autonomy by controlling the municipal councils. The Brazilian Oliveira Viana writes that those who enjoyed the right to vote and were also eligible to be voted into office were a select class, a nobility of “good men.” It was a true aristocracy restricted to bluebloods, rich landowners, the upper bureaucracy, and the high-ranking military of the colony and their descendants. To this group were added elements from another class, the “new men,” bourgeois who had become wealthy through commerce and had been welcomed in elite circles because of their conduct, lifestyle, wealth, and services rendered to the village or the city. Municipal institutions spread Iberian political models in the New World and consolidated the informal covenant linking the peninsula with America. This “informal colonial pact” created a strain between the king, represented by his officials, and the realms or territories represented by the municipal councils—the cabildos and the câmaras municipais. The king’s men and the municipal councils devised forms of cooperation to safeguard the integrity of the monarchy and of the Catholic faith and to identify lasting forms of interaction between the crown and the notables that might protect the interests of the subjects. In this colonial pact the influence of the municipal councils extended to Components of the Ibero-American World

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the entire subcontinent and even reached the Old World. In fact, in the 1600s and 1700s the policy arose of appointing municipal agents to further the parochial interests of each locality, as well as the merchant and mining guilds, at the viceregal courts, in the captaincies general, and at the courts of Lisbon and Madrid. In turn, through their deputies, the municipal councils of the viceregal capitals, governorates, and captaincies general strengthened their political hand at court, since the king recognized their right to speak on behalf of all the municipalities they represented. The cabildos of Mexico City and Lima, and later of Buenos Aires, Santa Fe de Bogotá, Santiago de Chile, Havana, and Caracas, eventually would have their own permanent deputies at the court of Madrid; the same would happen for a large number of Creole and Indian municipalities at the colonial courts of the subcontinent. Even the Brazilian municipalities began to send their agents, called “deputies of the people,” to Lisbon, although only the municipalities of the royal governorates enjoyed this right: the first city to have a “deputy of the people” was Rio de Janeiro (1641), followed by São Luís de Maranhão (1685). At court the deputies submitted petitions, requested privileges for their district and for deserving individuals, and sought tax and tribute exemptions for their clients. The activity of the Indian cabildos of New Spain was especially intense, judging from the number of petitions they submitted to the viceregal court. The expansion of this custom was therefore vital to the smooth running of the colonial covenant since, as I have said, the American provinces and realms were still not allowed to form their own parliament, or Cortes. The importance of these deputies was such that the crown authorized their travel to the mother country without first obtaining authorization from the colonial royal authorities. The ability of the municipal councils to establish a rapport with the colonial and metropolitan courts strengthened indirect governance in this period. The municipalities acted like branches of the central colonial authorities (viceroys, governors, captains general, royal courts, and royal treasury), obviating the need for a regular army to control the territory. The vast powers delegated to the municipal councils were reciprocated with a steadfast loyalty of the notables to the king and to the Catholic religion. Without the active participation of the municipal councils, the colonial pact would not have held. Its effectiveness stands in contrast to the little importance that the royal commissioner and the oidor had in Spanish America and Luso-America, respectively. While on the peninsula these officials received a salary and seniority status, in the New World they were just private individuals who had purchased the office or received it as compensation or reward for 76

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being members of the client “family” of the viceroy, captain general, or governor. Precisely because they were simply private individuals, who in turn had to pay their own agents, their authority was much weaker without the support of the local notables or the Indian authorities. Social and political changes also affect culture. In fact, there is an important cause-and-effect relationship between the colonial covenant and the gradual affirmation of a Creole identity that, despite roots in the Iberian Peninsula, began to differentiate itself after the 1750s. By then the native Indian had ceased being such and had taken on strong Iberian traits; at the same time the Iberian of the New World had distanced himself from his roots and had become Ibero-American. One agent of this change was the clergy, both regular and secular. The monasteries and parishes of the many religious orders and the secular clergy dotted the territory; their daily activities promoted Westernization among the native Indians and the hybrid generations. Especially in the seventeenth century, the monasteries spread Iberian customs through the rituals of baptism, communion, and marriage; processions and patron saint days; and even such aspects of material culture as the diffusion of European animals and plants. But a reverse process, the Americanization of the Iberians, also took place. Through daily contact with all the nonwhite populations, the whites became culturally mixed. The centers of this process were the latifundios, mining towns, and cities but also, and especially, the villages, starting in the eighteenth century. Surely, members of the upper class, in both the city and the country, borrowed from other cultures, living as they did next to the families of their workers who were from different classes and races. Of course, the government and the Church abetted this informal and spontaneous process . Education was both oral and written, though the spoken word reached more people. During homilies, public ceremonies held during visits of the viceroy and governor, and the celebration of the annual oath of allegiance before the royal insignia, lay church organizations such as brotherhoods read or recited speeches, prayers, and poetry or presented plays that spread to a vast audience not only the royal and religious doctrines but also the traditions of their native land. These events took place even in the most remote villages and testify to the significant role of informal education in building an Ibero-American cultural identity. Moreover, this informal education did more than the schools to make Spanish and Portuguese the languages of the subcontinent in the eighteenth century, while still preserving the Indian tongues in Mesoamerica and the Andes. Literacy played an important role in this process of Westernization, since Components of the Ibero-American World

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knowing how to read and write gave an individual more status in his village or town. Those who were literate would read to audiences that could read neither Spanish nor Portuguese; the literate also would read and compose letters, and often acted as interpreters. Parish baptismal records show that only one father in ten could sign the register. This is not to say that Iberian cultural models spread rapidly. Their propagation was hampered because one of the most popular written and spoken languages of Brazilian black slaves was Arabic, since most came from Muslim Black Africa, and by the popularity of African religions (also among nonblack populations) that spread and became Ibero-American, despite the opposition of the Church and royal authorities. Neither did Indian cultural forms vanish: at the end of the eighteenth century, Amerindian languages such as Náhuatl, Mixtec, Maya, Quechua, and Aymara still were more widely written and spoken than Spanish. The Iberians would learn them in order to conduct business or carry out their government duties. After Christianizing the Indians, the religious orders began to expand and compete for the education of the upper classes and to infiltrate the mixedblood populations. In this contest, even though the Jesuits had come late to America, after the conquest, they became preeminent among the upper classes because they guaranteed a superior education. The Jesuit colleges of Mexico City, Lima, Quito, Pernambuco, and Santiago de Chile offered the best education on the subcontinent and followed the same curricula in use on the peninsula. The teaching of the religious orders expanded, beginning in the sixteenth century, with the founding of universities modeled on the University of Salamanca; the first American universities were founded in the viceregal capitals of Lima and Mexico City. In contrast, since Portuguese America had no universities, its upper classes were forced to send their sons to be educated at the University of Coimbra. In the eighteenth century the Bourbons expanded the number of universities and brought under their control both higher and secondary education; therefore, starting in the nineteenth century almost all the Spanish-American countries had Caroline schools and universities that were powerful centers for spreading royalist and Gallican theories. During the seventeenth and eighteenth centuries, more than 100,000 students graduated from Spanish-American universities, proof of the great importance that the upper and other classes placed on university education and Iberian culture. Like their European counterparts, the American universities taught literature, law, theology, and medicine. Perhaps the teaching staff was not as highly qualified; still, there does not seem to have been a 78

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great delay in what was being studied in the Americas, because the rulers, the Bourbons in particular, were interested in renewing the curricula with a view to strengthening the principles of royalism in religion and of absolutism in the law. The circulation of ideas, visible in the existence of the press throughout the subcontinent and the library collections of colleges and universities and private homes, shows that the undoubtedly strong censorship was often disregarded. This laxity was a privilege of the university faculty in particular, since the Spanish universities in America, built in the image of the Spanish ones, were under royal patronage and thus enjoyed all the privileges of a corporation. The printing press was one of the main instruments behind the dissemination of ideas; it was present in all regions of the subcontinent starting in the sixteenth century, and publishing flourished in the eighteenth century with the spread of periodicals. While in the 1500s publications consisted mostly of chronicles, epic poems, and reports on American flora and fauna as well as Indian societies, starting in the second half of the 1600s they began to be replaced by poetry and philosophical and moral treatises, even though the study of Descartes was banned in the universities. In the eighteenth century the first works on mathematics, cosmography, geography, medicine, and moral theology also began to appear. The extensive diffusion and diversification of culture that brought Europe closer to America help explain the political changes that took place on the subcontinent starting in the mid-seventeenth century. Until recently historians have focused on uprisings and on the spectacular events in Tehuantepec, Mexico, considered the one great seventeenth-century insurrection, whereas the protests and political movements that mobilized both the lower classes and the notables, especially in the provinces, have been somewhat neglected. The more significant political shifts occurred in the second half of the eighteenth century in reaction to the absolutist reforms of the Spanish and Portuguese crowns. More than a hundred local rebellions erupted in Mexico to protest taxes, Church privileges, and the abuses of royal officials and to defend village lands from the encroaching latifundios. Similar small-scale or milder rebellions were a frequent occurrence in the Andean areas of Ecuador, Peru, and Bolivia, and actions protesting the fiscal reforms spread throughout the subcontinent, involving all classes. This insurrectionist crisis was deepened by the crown’s successful resolve to increase tax revenues: between 1741 and 1760, and 1801 and 1820, revenues from Spanish South America increased from 3.9 to 17.5 million pesos, while Components of the Ibero-American World

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the crown’s expenses grew more slowly, from 3 to 13 million pesos. More rapid was the increase in revenue from New Spain, which grew from 5.5 to 46.1 million pesos, while expenses grew from 5.4 to 44.9 million pesos in the same period. The greater fiscal pressure, in fact, touched off the various insurrections, since in the second half of the eighteenth century revenues from the head tax on Indians and mulattos, and the consumer taxes that mostly hit the new populations, increased more quickly than export taxes on goods bound for regional markets or the peninsula. In South America the percentage of the head tax that made up total revenue increased from 4 to 11 percent; the consumer tax percentage went from 0.5 to 5.7 percent of total revenue, while in Mexico the consumer tax had the steepest increase, from 4 to 14 percent from 1741 to 1800. In sum, while the fiscal pressure increased for the new classes, it decreased for the upper classes because commercial taxes were reduced, especially for long-distance trade and for mining products. Although the opposition of the new classes to this fiscal policy unleashed the two great waves of rebellion that followed the crown’s reforms, the process for each was quite different: in the Andes and in Mesoamerica the rebellions took on millenarian aspects, while in the areas with more mixed-blood populations, such as Colombia and Chile, and also in some Indian parts of Ecuador, the political cooperation between the masses and the notables was the most significant aspect of the uprisings. Unlike the situation from the 1650s to roughly 1730, the rebellions that began in the 1750s spread and became regional, thus encompassing populations of different ethnic origins. Still, the rebellions of both the seventeenth and the eighteenth centuries were neither independentista nor harbingers of independence; they did not question loyalty to the king but only the reforms that royal officials wanted to implement. The rebels’ motto, “Long live the king, death to bad government,” well captures the spirit of the times and illustrates another aspect of Ibero-American politics. The greater territorial and organizational complexity of these uprisings in the latter part of the eighteenth century made them a powerful tool for disseminating ideas against Bourbon absolutism and promoted a renewal and reorientation of the political culture of the notables and, in general, of all classes. The rebellion against the Venezuelan trade monopoly held by the royalprivilege company Guipuzcoana (1749–52) was probably one of the first that had this new aspect of political cooperation between lower and ruling classes. Starting in 1760, the conflicts spread to the entire subcontinent and in 1766–67 the first antiabsolutist revolts in important Mexican areas near the farming and mining regions of Michoacán, Guanajuato, and San Luis 80

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Potosí took place. Similar rebellions erupted in Ecuador (1765) and Chile (1765–68) that, as I have noted, were regional and even interregional in scope. The rebellions in South America protested a new tax on spirits and tobacco, two products widely consumed by the masses. This protest was supported by the notables, who produced and marketed these goods. The political participation of the elites is clear in the actions of the municipal councils, which advocated admission of all vecinos to these councils, regardless of their social rank, through the institutional mechanism of the extended municipal council (cabildo abierto), as happened in Quito and in Santiago de Chile. Like the earlier uprisings, the riots of the 1750s and 1760s were supported by a large number of pamphlets and leaflets denouncing the situation and demanding more political autonomy and more representation in the royal government. The 1780s saw a second wave of insurrections; unlike the earlier ones, these were clearly antiabsolutist and preached political and institutional reform of the American dominions under the Spanish monarchy. The rebellion in New Granada (Colombia), begun in 1781, protested the fiscal reforms and the rigid application of administrative reforms. The rebels, for the most part mixedrace farmers of El Socorro and San Gil who owned small and medium-sized farms, refused to pay taxes, attacked public buildings, expelled royal officials, and elected representatives from their community. They then chose one of these representatives, Francisco Berbeo, a latifundio owner, to negotiate with the viceroy, Archbishop Caballero y Góngora. The agreement signed on June 8, 1781, in Zipaquirá provided for the abolition of the monopoly on tobacco, reduction of the consumer tax, and administrative reforms to give more political autonomy to each locality. Finally, the agreement called for the appointment of more Spanish-Americans and gave more protection to the Indian population. In other words, the agreement between the insurrectionists and the colonial government clearly stated the Ibero-Americans’ demand for self-government within the monarchy. The movement of the New Granada communities began to fall apart when José Antonio Galán, a mixed blood, was chosen as leader, causing the more moderate factions to leave the movement and dooming the insurrection. Certainly, the fear of a government led by nonwhites put a brake on the political cooperation between the masses and the notables. The Comunero Rebellion affected both neighboring Venezuela and Peru. In Venezuela it made demands similar to those addressed in the Zipaquirá agreement, while in Peru and Upper Peru (now Bolivia) the demand for political reforms erupted in the Túpac Amaru rebellion—whose course followed closely the New Granada movement, although it was more violent, Components of the Ibero-American World

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lasted longer, and was more widespread, reaching even the northern areas of present-day northern Argentina. The Túpac Amaru movement began in 1780 to protest the administrative and fiscal reforms of the Spanish crown and (on the part of Indians especially) tighter control of payment of tribute owed to the crown. The movement’s leader, an Indian nobleman influenced by Iberian culture, was José Gabriel Condorcanqui, a descendant of Túpac Amaru, the last Inca emperor. Gabriel Condorcanqui took his illustrious ancestor’s name. Despite his strongly Europeanized culture, Túpac Amaru, like many eighteenth-century Indian aristocrats, was conscious of Indian traditions and thus won the support of the natives who made up most of the population in the rebel areas. His background enabled him to explain to the Spanish the dissatisfaction of the new mixed-blood classes. The many proclamations of the Túpac Amaru rebellion sought an end to the sale of district offices (corregidores), abolition of requirements that Indians work in the mines of Potosí (mita), abolition of the new consumer taxes, free trade for the Indian communities, and an end to the trade monopoly of the district (repartimiento) royal officials. Finally, the rebels also demanded the appointment of more Ibero-Americans to royal posts. The central ideas of the movement were essentially the same as those of the New Granada movement and the Mexican, Ecuadoran, and Chilean insurrections, reflecting the changes that had taken place in political culture during the eighteenth century. Like the New Granada movement, the Túpac Amaru rebellion became radicalized; public buildings, manufactories, and the homes of Spanish merchants were sacked repeatedly; Túpac Amaru could not maintain the initial alliance with the mixed bloods, nor did he get the support of all Indian notables, many of whom would side with the authorities. His capture in April 1781, six months after the eruption, brought an end to this phase, though in Upper Peru the Túpac Katari rebellion, predominantly Indian and controlled by the Aymara, continued to fester, threatening the city of La Paz for six months. Colonial authorities reacted with a violent repression, much stronger than their repression in other parts of Spanish America, an escalation explained by the movement’s secessionist, as well as millenarian, tendencies. The repression is an example of the new absolutist policy of the Spanish monarchy, which intended to rewrite the informal colonial covenant between the crown and the Spanish-American notables in favor of the crown; it marks the extreme limit of the imperial reorganization. The antiabsolutist reaction subsided somewhat toward the end of the eighteenth century as the notables realized that cooperating with the masses could become an even more serious 82

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threat than the crown’s absolutist claims. The insurrection of Túpac Amaru first, and later the 1791 slave rebellion in Haiti, confirmed to the Spanishand Luso-American Creoles that they needed new ways to stop the crown’s absolutism without provoking further insurrections. These thoughts were also shared by the Brazilian notables, who, unlike their Spanish-American counterparts, were involved in Pombal’s administration, in particular in managing the royal finances through their participation in the Junta de Fazenda, a financial consulting body. Still, the crisis in gold mining spread dissatisfaction among the merchants and the industrialists, a dissatisfaction that surfaced in 1788 when the colonial government decided to collect the debt owed to the crown by the tax collectors and was getting ready to request a “donation”—a mandatory loan—from mine owners and merchants. In many ways the 1788 rebellion—led by Joaquim José da Silva Xavier, who was known as Tiradentes (tooth-puller)—recalls that of Spanish-America, though there was no mass participation, perhaps because it was suppressed early on. This Brazilian insurrection suggests that new ideas had spread among the rebels, none of whom was part of the elite; as a matter of fact, the leaders were Tiradentes, two officers, some churchmen, a latifundio owner, a few magistrates, and many merchants and militia officers. They wanted to proclaim a republic in Minas Gerais; give it a constitution and a national parliament; and create municipal autonomy, a republican army of militiamen, and an executive council with a president elected annually. As was the case for Spanish America, it was suppressed by sending most of the principals into exile and hanging the leader. Beginning with the Tiradentes rebellion at the end of the 1780s, there was a significant change of direction in the insurrections. Even so, in Brazil in 1794 the viceroy count of Resende reported a conspiracy organized in Rio de Janeiro by about sixty notables who were reading and debating the works of French philosophers and the European political situation. Another conspiracy was reported in Bahia—it was dubbed the “tailors’ ” conspiracy, perhaps because some tailors had joined it, proof of how widespread republican ideas were, for this group wanted to establish a republic in the region of Bahia, free the black slaves, and establish free trade. The dissemination of new ideas seemed to accelerate in Spanish America at the end of the century. There was probably a search for political models and ideas suitable for carrying out reforms but without unleashing the masses politically. Readings and discussions of the works of Locke, Hobbes, Montesquieu, Voltaire, and, to a lesser extent, Rousseau and the Catholic Components of the Ibero-American World

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Enlightenment began to take place, along with a reflection on the forms of government existing in Europe and North America. Some of these themes were already in the manifestos of the comuneros and of Túpac Amaru, and echoes may also be found in the press of the time, starting in the 1790s. From the 1790s to about 1820 more than one hundred newspapers and other periodicals were published on the subcontinent, and starting in the 1810s both independentists and loyalists tried to influence the emerging public opinion through the press. The spread of new ideas also began to percolate down to the masses through leaflets distributed in plazas and even in taverns. This led to increasing reports of real or imagined independentist and republican conspiracies. In Rio de Janeiro, for example, they probably were not actual plots but new forms of socialization that were developing, as they were in Europe, in cafés and other public venues. The great subjects being debated, as Manuel Belgrano, a Genoese immigrant who settled in Buenos Aires, wrote in his autobiography, were the constitutional ideas of political freedom and free trade, of security, and of private property. The formation of political opinions and factions at the close of the eighteenth century illustrates the enormous change that had taken place and suggests how, starting from ideas for reforming the empire, the new directions that would lead Iberian America to independence were beginning to take shape.

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T h r ee

Revival

From the end of the eighteenth century to the first half of the nineteenth, that is, in the period from the French Revolution to the end of the Restoration, Latin America faced unprecedented challenges. Some had come about as a result of changes that had developed at the end of the eighteenth century; others had been triggered by a need to react to the new international system born from the demise of the old colonial empires; still others had been caused by the birth of independent countries on the American continent, most of which had adopted a republican form of government. In many ways the seventy-year period that I analyze in this chapter recalls the time right after the European invasion, when the Iberian monarchies had begun to settle on the new continent. At that time too people had had to rely on their knowledge and experience to confront novel situations. In fact, the confusion experienced when the Portuguese king fled to Brazil and the Bourbon king abdicated in favor of Joseph Bonaparte was short lived: Ibero-American culture rapidly adapted to the changes that came about in response to the popular mobilization, rebellions, wars, and insurrections provoked by the monarchic crisis and other political events in Europe. The last eighteenth-century revolution, for Latin American independence, accelerated the rhythms of daily life, much as earlier revolutions had in Europe and North America: the principle of social stratification began to wobble, the theological foundation of the sacredness of the king began to 85

shatter, and the values of guilds and estates became suspect. The lightningquick spread of the revolutionary idea of freedom on both sides of the Atlantic made this sea change possible. This new shared aspiration promoted a growing rapprochement between America and Europe, since both sides faced similar, though not identical, challenges. Two major principles derived from the new conception of freedom sustained the resulting process of Westernization: free trade and political freedom, principles inscribed in the constitutions of the new Latin American countries. Although the paths taken by the two continents to implement these principles were not necessarily the same, both sides were looking for new economic, social, and political forms within the same philosophical framework of liberalism, which is the foundation of nineteenth-century civilization. This shared approach would translate into different realities, a plurality of forms resulting from the different backgrounds and traditions. Nevertheless, none of these forms would neglect the need to link the order that each country would establish and the norms governing the new international system, which was being built on the principle of the balance of power of sovereign states.

T h e I n t e r nat iona l Con t e x t: Con t i n u i t y a n d Discon t i n u i t y

Political Freedom The growing openness of the American world to Europe, and America’s inclusion in it, preceded independence and followed the trade routes; this helped to promote the circulation of ideas and political models along with the circulation of goods. The most intense contacts took place in the latter part of the eighteenth century, as a result of the free-trade policies instituted by the Iberian monarchies and of contraband commerce: both facilitated direct contacts between the subcontinent and the rest of Europe. The Iberian Enlightenment was doubtless an important influence in America’s process of growing cultural openness, whereby the subcontinent would become more receptive to ideas from a wider international context that would lead to reform of the Iberian monarchies without necessarily undermining loyalty to the king or to the Catholic faith. In these late-eighteenth-century reworkings of political philosophy, the elites understood that they should not underestimate the insurrectionist tendencies of the masses, as their political participation could be destabi86

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lizing. The Jacobinism of the French Revolution and the rebellion of the black slaves in Haiti identified the limits of the elites’ propensity for political change. Thus they began to distinguish between the American and French revolutions, rejecting the latter for its Jacobinist excesses, atheism, and anticlericalism; what the elites liked about the North American revolution was its political moderation and the capacity to successfully overcome challenges. Thus history offered Latin Americans a number of paths. Both before and during the journey to independence, new ideas took shape about the rights of men and of citizens, the republic, the federation, and freedom of commerce and of people’s movements. Confidence began to develop in the ability of Latin American countries to make the best use, autonomously, of resources they saw as God-given. The reception of new ideas and their subsequent adaptation to the Latin American reality proved that local elites were perfectly able to distinguish between the various political and ideological proposals arriving from Europe. An example is the response of the Buenos Aires notables in 1806 to the British decision to attack the French-Spanish alliance in the southern Atlantic by occupying Buenos Aires, a maneuver that was part of British expansionist designs. While the viceroy of Río de la Plata fled Buenos Aires, the militia, headed by Creole notables and soldiers of lower-class origin, defeated the English and forced them to withdraw from Río de la Plata (1807). In 1800–1810, during the conflict with Napoleonic France and its allies, Great Britain tried all possible ways to weaken the enemy, from military action to dispatching agents to different parts of the globe. The English failure to take Buenos Aires strengthened Prime Minister William Pitt’s resolve to build a wide anti-French coalition that would include all the European monarchies. The French reacted by blockading English trade, a move that intensified British efforts in Europe, such that the English ambassador at the court in Lisbon threatened in 1807 to seize and destroy the Portuguese fleet and occupy Brazil if King John VI did not transfer the seat of the monarchy to Brazil. The Portuguese king and his court did move there the following year, in 1808; the king’s first decree was to open Brazil to trade with all friendly countries, thus satisfying the demands of the local elites. Different but just as significant was Spain’s entry into the anti-French alliance after Napoleon seized the Spanish throne and occupied the country in 1808. But in contrast with Portugal’s situation, in which the relocation of the monarchy left the institution intact, the refusal of Spaniards and Spanish Americans to recognize Ferdinand VII’s abdication in favor of Joseph Bonaparte created an institutional void. T h e I n t e r n at i o n a l C o n t e x t

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The Iberian monarchies found themselves in a novel situation, one that did not follow the international order sanctioned by the Peace of Westphalia. According to international law, a member of a different house could succeed a king only if the king died without leaving an heir and the successor was related by blood. Such a situation had in fact happened in Spain in the late seventeenth century. But now Spaniards and Spanish Americans saw Joseph Bonaparte’s accession after the abdication of Charles IV and Ferdinand VII as a French usurpation; it met with intense opposition in Spain, especially among the masses, and with confusion among the Creole elites. This turn of events initially strengthened traditional loyalty to the king and the crown on both sides of the Atlantic, but at the same time it opened the way to new and greater ideas. Although the reaction against the invader revived old traditions, leaving little space to the reformers, in the end it increased the freedom of royal subjects, gradually directing the idea of freedom away from a corporatist, hierarchical logic to a universal one—a freedom that should not be differentiated by estate or guild but seen as the right of all human beings, regardless of social status or origin. In this sense the absence of a Spanish king afforded Spanish subjects in the Americas, and in general throughout the kingdom, a greater freedom of action, one that linked tradition with modernity, loyalty to the monarchy with the demand for constitutional guarantees of the rights of men and citizens. Still, unlike the changes in Portuguese America, the link between tradition and modernity did not include the economy, as free trade in Spanish America was a reality only in areas such as Río de la Plata and Venezuela; it would not be extended to the rest of the subcontinent until the 1810s. One theory is that when the French invaded Spain, the only political vision that could cope with the absence of royal authority and of the king himself was the medieval notion of a social covenant, whereby, absent the king, power would revert to the people and thus to the various realms and provinces making up the Spanish monarchy. But this theory cannot explain the resolve in Spain and its colonies to work toward a new, reformed monarchy founded on a written constitution. This resolve is evident in the creation of the Junta Suprema Central, the central ruling board formed even as Napoleon’s armies were marching into Spain. Starting in 1809, this provisional government acceded to various demands, asking the realms and provinces to send royal representatives to participate in the government. This was an enormous event for Spanish America, whose only form of representation since the conquest had been the court delegates or deputies 88

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appointed by the municipal councils of each viceregal capital. The junta’s decision is even more momentous because it disavowed the Bourbons’ absolutist policy by decreeing that the Spanish Americas “are neither colonies nor farms, but integral parts of the Spanish monarchy” and, as such, “must be immediately represented by their own deputies.” Thus the junta recognized the malaise of the Creole elites. All of Spanish America enthusiastically welcomed the call to the Cortes and immediately called elections to choose representatives, with great involvement from the middle classes and the municipal councils. If the participation of Spanish America in the government of the monarchy was an element of continuity in the discontinuous process that had begun in 1808, another element of continuity was the war against the French, which had the effect of strengthening autonomist and liberal aspirations and ended in the call to assembly of the Cortes. In America autonomist drives were strong in the hinterland and in areas that had seen major expansion in the late eighteenth century. In fact, the municipal councils of Chuquisaca and La Paz in Bolivia and of Quito in Ecuador adopted collegial forms of government—juntas—that displaced the old royal officials. Following the creation of the Regency Council in 1810, the junta governments spread to the dynamic regions of the eighteenth century—Caracas, Santa Fe de Bogotá, Santiago de Chile, and Buenos Aires—with the approval of the municipal governments in each jurisdiction. In 1810, the most critical year for the Spanish monarchy, the autonomist drives and the refusal to recognize the authority of the old royal officials also promoted a refounding of the monarchy, such that the Central Junta called for elections to the Cortes in January of that year. This was a crucial moment because it introduced a liberalist form of representation. The idea that citizens could forward their demands through deputies elected by the holders of political rights was especially strong on the subcontinent, while in Spain the deputies were selected more traditionally, through appointments by the regional and city juntas. The convocation of the Cortes substantially modified the traditional rule that had been in place for the last convocation one hundred years earlier; at the time the Cortes had representatives from the three traditional estates: the cities, nobility, and the Church. The innovation of this convocation—that estate-based representation was being discarded—meant that the French and American revolutions had left their mark. In fact, in comparing the calls to assembly of the French States General and the Spanish Cortes, it is clear that while the former adopted only estate-based criteria, the latter based its criteria on regional representaT h e I n t e r n at i o n a l C o n t e x t

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tion for the peninsular areas and on regional and demographic representation for the American areas. For the first time the general population was a factor in determining political representation. At the congress the three hundred Cortes deputies, about sixty of whom were American, divided into liberal and conservative factions; the liberals called the conservatives “slavish,” although the majority favored transforming the monarchy from absolutist to constitutional. In addition to functioning in its usual legislative role, the Cortes served as the constituent assembly, promulgating in 1812 the constitution of the Spanish monarchy—a text that would become a model not only for Spain but also for Portugal and liberal Europe in the 1820s. The 1812 constitution gave birth to a monarchy founded on the sovereignty of the Spanish nation, which was understood as the union of all Spaniards of both hemispheres. The constitution guaranteed Spaniards freedom, private property rights, and those political rights that legitimately belong to individuals as human beings. By virtue of these rights and duties, Spanish citizens born in both hemispheres, with no distinction as to blood, ethnicity, or race, were entitled to elect their representatives to the monarchy’s general congress—the Cortes—to the provincial assemblies, and to the municipal councils. The constitution affirmed for the Spanish and Spanish-American world the liberal concept of representation, which was reinforced by the idea that the deputies, as Emmanuel-Joseph Sieyès affirmed during the French Revolution, represented the nation and not the territories that elected them. The constitution embodied the Spanish and American Enlightenment traditions and the innovations introduced by the French and American revolutions. It guaranteed the plurality of the realms and territories that made up the monarchy and at the same time connected them to the idea of nation through the rights of citizenship, representation, and a constitutional form of government. In sum, it provided a model that answered the needs of the Spanish and Spanish-American world because it redesigned the mechanisms of cooperation of the various social and political elements to create a new governability within the territorial units and entities making up the monarchy. Although some American regions did not send representatives to the Cortes, none seriously questioned the constitution as the new foundation of the state. In this sense it is telling that even before the 1812 constitution was promulgated, the American territories began to give themselves constitutions. In 1811 in Venezuela, a congress elected with criteria almost identical to those of the Cortes drew up a republican federalist constitution that guaranteed the rights of man and of citizens and established income requirements 90

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for eligibility for the office of deputy. Also in 1811 Argentines approved their first constitution, and in 1812 the Chileans gave themselves a constitution, even before Cádiz. The new Spanish-American constitutionalism was a variant of Western liberal doctrine, which includes monarchical and republican forms of government and, within the latter, unitary, confederate, or federal republics. At this point the experience of the United States became important because of the many interactions between Spanish and British America regarding territorial rights. Thus the process of internationalizing ideas proceeded apace and was, as I have noted, a distinguishing feature of the period from 1800 to 1850. Brazil went through a similar process, although its path to a constitutional solution took longer. In fact, the transfer of the Portuguese court to Rio de Janeiro was a sort of translatio imperii that turned the viceregal capital into the capital of the monarchy. It also strengthened the monarchical institutions that were weaker in Brazil than in Spanish America; it promoted culture and the publishing of books, newspapers, and periodicals. In just a few years the bonds between the king and his Brazilian kingdom were reinforced by the acceptance of the king by the Luso-Brazilian elite and by the administration of free trade, which spurred foreign trade and increased the king’s revenues from customs duties. As a result John VI decided to elevate Brazil to a kingdom with rights and duties identical to those of the other two kingdoms of the Portuguese monarchy—Portugal and Algarve. Just as important was his decision to remain in Brazil, even in the face of British pressure for him to return physically with his court to Lisbon. Thanks to the newfound unity of the Luso-Brazilian monarchy, Brazil was free of the constitutionalist turmoil that roiled Spain and Spanish America, though the latter had also been fueled by Bonaparte’s usurpation. The search for a new constitutional system was deeply felt in Portugal after it was occupied by the French, then placed under English protection until the 1820 revolution and the creation in Oporto of a provisional junta of the supreme royal government, which was supported by the English, in opposition to Lisbon’s regency. The two provisional governments were in agreement on the need to assemble the Cortes, and deputies were elected on the same basis as the 1812 Spanish Cortes, that is, on regional, demographic, and income-based criteria. Thus the long period of conflict from 1790 to 1814, and the coalition against revolutionary France first and Napoleonic France later, aided the increased participation of the American areas in the international system. Internationally, the subcontinent gained strategic importance both geopoT h e I n t e r n at i o n a l C o n t e x t

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litically and for trade. This greater international presence did not expand after the victory of the monarchic coalition that included Great Britain, Austria, Prussia, and Russia because the coalition restored the old dynasties to the thrones of France, Spain, and Portugal. For Spain the reinstatement of Ferdinand VII meant the end of the constitutional monarchy, abrogation of the 1812 constitution, and repression of the liberal circles. John VI of Portugal preferred to stay in Brazil; when he returned to Lisbon in 1820, he approved in the same year the constitution drawn up by the Portuguese Cortes. The European Restoration reduced the international presence of the subcontinent. In addition to reinstating the old kings, the decisions taken by the European powers at the Congress of Vienna (1814–15) gave renewed centrality to Europe with the creation of a consulting board of the foreign affairs ministers of the European monarchies; its purpose was to ensure the effectiveness and adequacy of the principle of the balance of power in the new era. These new trends, in addition to checking the liberal impulses that had caused the riots of the 1820s and 1830s, were hostile to the new Latin American independent states. As a matter of fact, Europe only partially accepted their national sovereignty, treating them like simple de facto governments, and began to form a negative opinion of their policies. Thus in the 1820s the myth of the political inferiority of the Latin American countries was born. It was to last for more than a century.

The Difficulties of the New States in the International Context From the moment that the Latin American countries declared their independence, leaving behind the monarchic regime for a republican one, their relationship to the rest of the world changed, a change that required specific treaties to define the relations that each wanted to pursue. Even before negotiations could begin, this new phase was conditioned by Europe’s negative perception of the new states, insisting as it did on their inability to keep order domestically and guarantee private property rights to foreign subjects, a condition that the international community felt was essential before it could recognize a state’s sovereignty. Both issues delayed the redefinition of the international sphere that was still governed in the early 1800s by the balance of power principle that had been formulated almost two centuries earlier. Even if, as a matter of principle, the new Latin American states could claim that indeed they possessed sovereignty, the requirement essential for belonging to the international community, Spain refused to acknowledge such sovereignty, arguing that the states were its subjects. Spain even asked 92

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the European powers to support its restoration claims at the 1818 conference of Aix-la-Chapelle. France and Russia favored a European intervention, but Austria, Prussia, and Great Britain were opposed. In the end no European power recognized the new independent states. Unlike the rebellion against Britain of the thirteen North American colonies, which received assistance from France and Spain, the Latin American revolutions received no explicit support, from the United States or even from Great Britain. Only some sympathizers and European volunteers left idle by the European Restoration, but no country, intervened on behalf of the Latin American revolutionaries. To all effects, the new states had no interlocutors in Europe, even though all were republics with constitutions that were not unlike the European ones and even though all had opened their trading ports to all nations, even before signing treaties. One important factor that might have favored their international recognition—Catholicism—did not help because a serious dispute broke out between the new states and the Vatican about whether the patronato real (special privileges granted to the Spanish and Portuguese monarchs in return for evangelizing the New World) should be transferred to the new republics, as the states wanted, or lapse, allowing the privilege to return to the Holy Father, as the Holy See argued. Nor did this negative attitude vanish after the United States, and Great Britain in particular, began to recognize, de facto if not de jure, the existence of these states by signing friendship and commercial treaties in the 1820s. In addition to the negative climate of the European Restoration, for a long time (nearly until the 1850s and later) a number of other factors—especially after 1825, their form of government and their political and financial performance—blocked full international recognition of these states. Until the 1850s the main rift between the new states (with the exception of Brazil, which chose to be a monarchy) and Europe revolved around the republican form of government that they had adopted. And, unlike the United States, where all classes quickly adopted the idea of the republic, especially during its stellar economic growth in the 1820s and 1830s, in Spanish America an internal debate between republicans and royalists continued up to the 1850s. It almost seemed as if Spanish America had adopted republicanism either because no Spanish princes were living on American soil or out of fear that a monarchy would try, as the Spanish crown had done toward the end of the eighteenth century, to centralize power to the detriment of the regional elites. The fear that the local elites would be cut out of the equation had made the French Revolution’s identification of monarchy with despotism popular in the Spanish-American imagination. T h e I n t e r n at i o n a l C o n t e x t

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Although republicanism had a European precedent, first and foremost in the French Revolution, it was also, and primarily, American: most of the American countries were republics, whereas most European countries were monarchies. In Europe the royalists equated the republican ideal with disorder and disorganization, while in America the republicans identified monarchy with despotism. In this quarrel between the two worlds, the European countries tended to tout the advantages of a monarchy, while America promoted the egalitarian model of the republic, especially to the new rising classes. Understandably, then, Brazil, the only American monarchy, became the favorite country of the European monarchies; after Portugal recognized Brazil’s independence in 1825, Brazil was the first country on the subcontinent to institute regular diplomatic relations with Great Britain, France, and the rest of Europe. By 1828 Brazil had already signed commercial treaties with all the European monarchies and the Hanseatic city-states and was about to sign one with the United States. The decision of the Spanish-American countries to become republics cost them, because, as had been the case for the United States, republicanism broke the international order that had been founded on monarchic and dynastic principles since the Peace of Westphalia. This tension between the dynastic principle, on which the monarchy was based, and the principle of electing representatives, on which the republic was based, soured not just relations with Europe but all international relations. These relations were predicated on the sovereignty of nations, and sovereignty was considered legitimate and complete only in the case of a reigning dynasty, not an elected president. Modern international relations based on national sovereignty together with tolerance and mutual respect would gradually come to prevail in the nineteenth century. But during the Restoration the former Spanish-American colonies were denied entry into the society of states, for membership was a prerogative of hereditary monarchic sovereignty, which they had rejected. How could they expect to become subjects under international law when they did not accept its fundamental precepts? A need therefore arose to develop tools that could facilitate a minimum level of interaction between the Latin American republics and the European monarchies, given that the latter had commercial interest in the former. Some historians consider this tension irrelevant, asserting that Great Britain, eager to capture the Latin American markets, somewhat surreptitiously developed a system of contract law that ignored the principle of monarchic sover94

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eignty in practice without negating it in theory. The many friendship, trade, and navigation treaties are tangible evidence of this system of positive law. The negotiation of commercial treaties in practice bypassed the issue of republicanism. This solution was said to be the work of British prime minister George Canning (1827), who had a background in commerce rather than in diplomacy or politics. In 1826 William Huskisson, president of the Board of Trade, suggested to the English Parliament that the American revolutions made it necessary to introduce a new law to ratify commercial reciprocity between Great Britain and the new states. He also argued for the need to extend to them the trade and navigation reciprocity treaty that Britain had signed with Brazil in 1810. The model Huskisson suggested was not new but a reworking of the treaty prepared for the United States by John Adams in 1776 and described by Thomas Jefferson as a treaty that established peace, commerce, and honest friendship without forming a political alliance with any power; it also broke with the strict correlation the European states had long maintained between commerce and politics, according to which trade treaties were derived from peace treaties. This concept of relations between states underscores the equality of different forms of government and was meant to defend the United States from outside threats, because in the 1820s it was still the only republic among all the independent states. The same defensive approach appears in Colombia’s 1821 manifesto to the European governments that was prepared by foreign affairs minister Francisco A. Zea. The manifesto insisted on state reciprocity, independent of the form of government, and the assurance that Colombia had no intention of signing treaties unless the other party recognized the full freedom, security, tolerance, and reciprocity of the new republics. This idea was also intrinsic to the treaty signed with Mexico in 1824, in which Colombia and Mexico pledged to support each other in defending their independence from Spain or from any other power. As I said, the treaties that Great Britain would sign from 1824 to 1828 did not require full acknowledgment of national sovereignty; they merely noted the sovereignty of the Latin American countries without explicitly recognizing it. Somehow, Great Britain had picked up on the U.S. model, because Britain separated the political from the commercial aspect, thus avoiding recriminations from Spain and its allies, and without creating problems for British trade with Latin America. This separation of politics from trade was incisively summed up by Prime Minister Canning as “no alliance, no aid, no approval of changing of governments, no statement about the means pursued T h e I n t e r n at i o n a l C o n t e x t

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by the Latin American countries to reach their independence.” Still, according to Canning, a statement of fact is different from an acknowledgment, which in and of itself implies a value judgment as to the legitimacy of a country’s declaration of independence and sovereignty. Therefore the friendship treaties with Great Britain were not founded on equality, because in this case friendship meant nothing more than the intention to strengthen reciprocal contacts in order to avoid conflict. The real effect of this type of relationship was the partial recognition of the new republics, and from a commercial point of view it was limited to extending to the republics the “most favored nation” clause, which meant that tariffs on products from England or from a Latin American partner could not be higher than those applied to other nations. Politically, it gave Great Britain the opportunity to assess the wisdom of revoking the treaties whenever it felt that a republic could not ensure freedom of trade and navigation and the property rights of British subjects and merchants. This understanding of interstate relations was not exclusive to Great Britain. All the European countries adopted the English formula: France, Holland, Denmark, Prussia, the Hanseatic city-states, even the Sardinian-Piedmontese kingdom. The formula remained substantially unaltered until the second half of the nineteenth century. With this partial recognition of their sovereignty, the new republics acquired an intermediate status, between a country founded on monarchic legitimacy and a colonial country, and were under the constant threat of being placed under European tutelage. Although the United States did not follow the British example and did recognize the independence of the new countries without considering whether they could, de facto and de jure, protect their borders, not all American public opinion thought favorably of the new republics. The Jeffersonian belief that the United States was the cradle of liberty evolved, particularly after the U.S.-Mexican War (1846–48), into political antipathy and cultural prejudice toward Latin America. Throughout most of the nineteenth century the United States was viscerally interested in expanding its territory westward, a tendency that set the stage for the American Civil War (1861–65) and sowed deep divisions within the Union between proslavery and antislavery states. The United States’ conquest of Mexican territory, its attempts to occupy Central America, and its support of Cubans who wanted annexation by the United States illustrate the point to which European power politics conditioned not simply international relations but also inter-American ones. The rivalry between Great Britain and the United States—the former interested in trading with the Americas and in defending its Canadian and 96

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Caribbean colonies, the latter in expanding its territory—contained European efforts to intervene in Latin America and Spain’s interest in retaking those countries. In fact, the Monroe Doctrine, which was enunciated by U.S. Secretary of State John Adams in 1823, thwarted those intentions. The doctrine insisted on the right of the United States and of Latin Americans to choose forms of government different from those of Europe and threatened to fight any attempt by Europe to recolonize the hemisphere. The entry of an independent Latin America into a barely receptive international context helps to explain why it became embroiled almost immediately, even indirectly, in old-style power politics. Even if the new countries did not want to get involved in European conflicts, France did intervene in Buenos Aires and Mexico in the 1830s and 1840s. The French fleet occupied the Mexican port of Veracruz and repeatedly blocked the port of Buenos Aires, demanding from Mexico adequate compensation for the losses sustained by French traders, and from Buenos Aires free navigation on the Paraná-Paraguay rivers, which were considered exclusively Argentine territory. Spain tried to interfere as well and, together with France and Great Britain, frequently threatened a blockade, should the claims of their traders not be recognized. Nevertheless, the new republics successfully defended their sovereignty and independence because they were founded on written constitutions that were, as I have noted, the pivotal element of discontinuity between the old colonial order and the new. In comparison to the kingdoms of North Africa, Egypt, and the Middle East that would become European colonies or protectorates, Latin American countries enjoyed a relative advantage on the international scene because they shared Europe’s political culture, which allowed them to participate in the international community as independent, constitutional, and Catholic political entities. In sum, these markedly Western elements reined in a revival of European colonialism and U.S. expansionism. Very probably, the partial acceptance of the new republics also depended on the moderate positions of their ruling classes. Animated by an Enlightenment optimism, in the decade following independence these elites worked to flesh out a constitutional regime that would guarantee equality under the law to natives and foreigners alike, as well as the rights of men and of citizens, the division of the state’s powers into branches, and the election of all public offices, including, in some countries, judgeships. Just as important, all the countries recognized Catholicism as their state religion. Thus their constitutions, inspired by those of Europe and the United States, strengthened their sovereignty, embodying as it did the Western notion that a state acts within T h e I n t e r n at i o n a l C o n t e x t

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its own borders as the sole source of all government powers and prerogatives. Starting from this principle, the new countries tried to reach the domestic cohesion needed to guarantee national sovereignty, fighting disruptive tendencies and outside pressures. Constitutional recognition of Catholicism as the official state religion facilitated the Church-state relations inaugurated in the 1830s and became another defense of sovereignty because, as Catholic countries, they shared the heritage upon which nineteenth-century Western civilization was founded, an advantage not shared by Muslims, African animists, or Hindus. Building new Church-state relations was a slow process that required a new treaty with the Holy See. Although the lower clergy had greatly aided the cause of independence, the ecclesiastical hierarchy (bishops, archbishops, and provincials of the various orders) had remained faithful to the monarchy. Even the papacy—first Pius VII in his 1816 encyclical, then Leo XII in his 1824 encyclical—sided with the Iberian rulers. This Ultramontane position caused the Latin American mission of Giovanni Mastai-Ferretti, the future pope Pius IX, to fail. Only in the 1830s did the Holy See and the ecclesiastical hierarchy, worried by the growing popularity of liberalism, finally begin to acknowledge the new republics, using the wording formulated by Great Britain that recognized only their independence and sovereignty. The pope’s recognition of Brazil was not as restrictive, since it was a monarchy and had inherited all of Portugal’s privileges, including the padroado (Spanish patronato) granted to the fifteenth-century Portuguese and Spanish monarchs for spreading Catholicism to the New World. In recognizing the Latin American republics, the Holy See chose to suspend, but not annul, the patronato privileges formerly exercised by Spain in appointing bishops and collecting the Church tithe. The Vatican would extend the patronato to the republics on condition that they declare Catholicism the official state religion and that the Church continue to enjoy all the privileges it had under the monarchy. In addition to creating an additional bulwark for sovereignty, the new Church-state relations were important because, as the Mexican Lucas Alamán noted, Catholicism was the one element that unified the many ethnicities and races of Latin America.

Toward a New Place in the International Economy Commercial and economic relations based on a liberalized trade strengthened the international position of the new states. Despite the disputes between customs officers and foreign traders about tariffs, navigation permits, recognition of credits granted by the traders to the governments, or the misconduct 98

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of foreign officers and sailors and the abuses of the local military, the idea slowly gained credibility that foreign trade and the industries owned and operated by foreign entrepreneurs were vital to a nation’s economy and therefore should not only be encouraged but also adequately protected by laws that did not exist in the colonial period. Surviving estimates and data make it possible to describe Latin America’s position in the world at that time. These are comparative, not absolute, values; as such they are more useful for a qualitative assessment than for a quantitative analysis. Between 1820 and 1870 Latin America was more prosperous than average; its GDP grew 1.5 percent a year, while worldwide the average was 1.0 percent a year; in Europe it was 1.7 percent. Only the United States, Australia, and New Zealand grew much more rapidly, at the combined annual pace of 4.3 percent. These indicators show that the economic, as well as institutional, challenges involved in liberalizing trade were relatively well managed by the new states and the economic actors. The new countries had an important supply of raw materials and a strong demand for European semifinished products and consumer goods. Had the new states been unable to meet the supply or effectively manage their economy and their finances, they could have provoked attempts to install protectorates or to recolonize, as occurred elsewhere in the world. The ability of the new countries to consolidate their sovereignty with their international economic performance shows the importance that they assigned to the presence of British, French, Spanish, Portuguese, Hanseatic, and Genoese trading houses and the intertwining of domestic and foreign economic interests. By about 1850 the subcontinent could already manage its own trade by making expansive use of financial mechanisms such as the discounting of notes in local and British currency. The growth in the volume of trade between Latin America and Europe gave rise to a payment system that could compensate for any differences in commercial value on the two sides of the Atlantic. The Latin American economies opened up to international trade and finance relatively quickly. Independence brought real advantages to the subcontinent, just as the libertadores had envisioned, and the benefits were felt, in many cases, even before the actual declaration of independence. The Latin American economies knew how to adapt to innovations in financial services, which were practically nonexistent before independence, when long-distance commerce was based on offset accounting between the value of the imported and exported goods. Before 1820 finance had little autonomy with respect to trade, just as the import trade was not separated from the export trade, since T h e I n t e r n at i o n a l C o n t e x t

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they were managed by the same merchants. From 1820 to 1850 merchants began to specialize, creating new mechanisms to separate the payment of goods from their movement. Forms of monetary compensation were born through the acceptance or release of notes by specialized houses—the exchangers—and, in some countries, banks. This important qualitative change is clear only by taking into account the expansion of trade between the subcontinent and the rest of the world. Information for each Latin American country simply is not available, but a good indicator is the evolution of trade between the subcontinent overall and Britain, which represented more than half the total international trade of Latin America. One result of free trade was a rise in the value of exports and imports between 1784 and 1786 and between 1824 and 1826 (the increase in value also derived from a decrease in the smuggling that had existed under the former colonial monopoly). On the other hand, the increase in trade value between 1830 and 1850 is attributable to an increased international demand for Latin American goods, which was facilitated by a better integration of the new countries in the political and economic international system. In particular, Latin American goods exported to Great Britain grew much more rapidly than Britain’s exports to Latin America, which gradually reduced its negative balance of trade, which had been quite large between the 1820s and 1840s. But unlike the situation before independence, management of the negative balance did not simply mean payment in bullion but also several innovations in mercantile and exchange techniques that softened the negative effects of the trade deficit. Although the new countries’ trade with Great Britain remained relatively small, even within the limits of a not very favorable international economy they were able to convert the new trade policy into a dynamic force for growth. In other words, the international economic context was probably much less punitive than the political one. The free trade policy made it easier to build different financial relations between the two blocs. In fact, the presence of the subcontinent countries in international finance through the issue of state bonds on the London money market makes it probable that these countries initially enjoyed the trust of international bankers and investors. Such trust is clear in the credit conditions granted to the governments of Chile, Colombia, Peru, Brazil, Buenos Aires, Guatemala, and Mexico, which were substantially the same as those offered to the Danish, Russian, or Neapolitan monarchies. The issue price of the bonds suggests that the public (primarily small British investors) purchased them at prices similar to those paid for bonds issued by European 100

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states. This is interesting because it shows that a gap existed between British public opinion and foreign policy: British investors had a much more positive feeling than their government about the future of the new states. In building this positive image, the reports of British travelers who insisted on the incredible riches of the American continent played an important role. This happy image rapidly deteriorated when Latin American bond prices crashed from 1825 to 1829 because the issuing states failed to pay interest and the agreed-upon depreciation rates. With the fall of the bond prices the trust that the new countries had enjoyed proved ephemeral, and British public opinion turned. Another factor was that the British government did not support the claims of the bond holders. The charges of irresponsibility against the Latin American countries were somewhat justified, because the failure to honor their financial commitments did not depend on their economic performance but on their weak finances, burdened as they were by a domestic public debt swollen by the wars of independence and the chaos created by changes in the administrative structures of the new states. The undeclared moratorium in paying the foreign debt destroyed their financial credibility. These states had blocked the entry of British and European banks on their soil until the 1850s, even though the bankers could have supported the growing foreign trade and created a financial economy on the subcontinent.

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The Last Eighteenth-Century Revolution It is clear that the independence movement triggered discontinuity and innovations on the subcontinent. In fact, like the American and the French revolutions, Latin American independence mobilized many parts of society and unleashed a sea change that made it possible for these areas to enter into the new international order, which embraced countries characterized by constitutional governments. Although Latin American independence was not a negation of Iberian heritage—and, as a matter of fact, had its foundation in Ibero-American political traditions—in the revolutionary process new political models were perfected that questioned and adapted the received European theories. In this sense the Latin American revolutions were an extraordinary time of political openness that swept away the last obstacles to the free circulation of ideas between the two continents. T h e N e w S tat e s A r e B o r n

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It is possible to analyze the movement toward independence by following its two essential phases: the legitimacy phase, from 1808 to 1814, and the independence phase, from 1814 to 1821. In the first phase the main option was to remain part of the composite Iberian monarchies but transform them into constitutional states with broad political and administrative autonomy for the various realms and provinces therein. In other words, dominant opinion favored creation of a Spanish-American community and a LusoBrazilian one, both having written constitutions that—like the Spanish and Portuguese constitutions—would guarantee the existence of autonomous governments on the subcontinent, with a king as guarantor of the unity of the monarchy. Napoleon’s invasion of the Iberian Peninsula in 1808 reinforced this reformist tendency, which was rooted in late-eighteenth-century theories. That was the year when the Portuguese court moved to Rio de Janeiro and a political movement was unleashed in Spanish America that, absent a legitimate king, would lead to the creation of ruling juntas to defend the land from a French invasion. In Spanish America the new situation shattered the existing administrative subdivisions and brought to the surface the regional differences—the different homelands—that existed within the viceroyalties and governorates. In fact, the acceptance of the legitimacy of the Bourbon king was organized at first through the new collegial governments—the juntas de gobierno appointed, not always unanimously, by the municipalities under direct control of the colonial capitals. On the other hand, the juntas fragmented the existing political and administrative subdivisions that were formed in areas that lay outside the great traditional viceregal centers of New Spain and Peru and in the newer viceroyalties of New Granada and Río de la Plata. The first juntas appeared outside the two great viceroyalties of Peru and New Spain. In the viceroyalty of New Spain the abdication of the king led the municipal council of Mexico City, as the representative of all the cities of New Spain, to demand the viceroy’s resignation since, in the absence or incapacity of the king, it was up to the realm and the propertied classes to appoint a new government and new judicial authorities. After hearing the opinions of the business, civic, military, and ecclesiastical guilds, the viceroy approved the calling of an assembly of all the deputies of the cities of New Spain. Some Creoles and Spaniards opposed this decision, making it possible for the supreme court (the Real Audiencia) to depose the viceroy and appoint its own regent as provisional ruler. In the viceroyalty of Peru the legitimist and autonomist tendencies surfaced in two unusual areas, Upper Peru (today’s Bolivia) and the province of Quito. 102

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In Chuquisaca first and La Paz later, ruling juntas had already been formed in May 1809; the La Paz junta drew up a plan that reflected Creole reformism, proposing radical reforms in the royal administration. But the radicalism of the autonomists alienated the moderates, and this in turn weakened the juntas of Upper Peru; in the end the president of the Audiencia appeared at the gates of La Paz to bring the region back to the old order with the support of a reduced army sent by the viceroy of Peru. In Quito, Creole autonomy was similar to that of Upper Peru: a group of reformers arrested the president of Quito’s Audiencia and organized a junta that approved a program of reforms that even included a reduction of the consumer tax (October 10, 1809). But the junta failed to secure the support of the other provinces, and the deposed Audiencia regent was reinstated in office. Finally, a military contingent sent by both Lima and Guayaquil helped to restore order. The ability to control the territory shown by the administration of the older viceroyalties contrasted with the fragmentation that was developing at the periphery. The unraveling of the administration in Río de la Plata, a recently instituted (1776) viceroyalty, favored the transition from autonomy to independence. A municipal council open to all the notables was called in Buenos Aires on May 25, 1810; it set up a provisional junta that the other cities of the viceroyalty were to approve. Although the junta received the support of the entire province of Buenos Aires, including the militia that had defeated the British in 1806, the provinces of Uruguay, Paraguay, Córdoba, Charcas, and Salta did not recognize the junta and instead chose to recognize the regency seated in Spain. The tensions in the junta between the autonomist and radical wings favored the latter, which created a public safety tribunal reminiscent of French Jacobinism in order to destroy the opposition. The arrival of deputies from the other provinces reinforced the autonomist faction, which finally expelled the radicals, but later the radicals took control, reduced the junta to a triumvirate, and formed a congress with the remaining members. Despite its autonomy, the Río de la Plata government enacted reforms that recalled those of the Cádiz constitution, with one major difference: this first Argentine constitution created an executive triumvirate that pursued centralization by abolishing the provincial juntas of Corrientes, Entre Ríos, and Uruguay; the juntas in turn refused to recognize the authority of Buenos Aires. This experience showed that a plurality of provincial forces existed side by side in the viceroyalty even before 1810 and that it wanted to create states independent of both Spain and Buenos Aires. This strong autonomist strain would make it possible to move quickly toward independence after 1815. T h e N e w S tat e s A r e B o r n

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The autonomist movement in Chile followed the evolution of Río de la Plata’s, with the important difference that in Chile it was snuffed out by the absolutist troops dispatched by the viceroy of Peru. In Chile as well the municipal council of Santiago, membership in which had been extended to all the notables, appointed the junta (September 18, 1810). In 1811 the junta called for a general congress, which approved a constitution the following year. As had been the case for Río de la Plata, the internal conflicts initially favored the pragmatic independentist factions, but their excesses reinforced the moderates, in the end bringing about the restoration organized by the viceroy of Peru in 1814. In addition to weakening the independentist movement, whose leaders had to flee to Argentina for safety, the restoration punished the moderate notables, deporting some and forcing them to make loans to the colonial government. The repressive attitude of the colonial authorities would lead Chile to support the independentist army, which would be recruited out of Mendoza, in Argentina. The autonomist movement in the viceroyalty of New Granada partially recalled that of Río de la Plata and Chile, for example, in the fragmentation of the territory. The breakaway process happened quickly: between May and July 1810 the five regions of New Granada formed regional governing boards, four of which—Cartagena, Cali, Pamplona, and Socorro—decided to recognize the Spanish regency, while the most important of them, Santa Fe de Bogotá, declared its autonomy and opposed Cartagena’s call for a confederation. The Bogotá junta called a general congress in March 1811; it created the Republic of Cundinamarca, with Bogotá as its capital, and approved a constitutional charter that called for a strong legislature and a weak executive branch. Also in 1811 other juntas created the Federation of the New Granada Provinces, with Tunja as capital. The fragmentation of New Granada led to a three-year civil war and the restoration of the colonial government in the region of Bogotá, whereas the New Granada Federation proclaimed its independence, then was returned to the folds of the viceroyalty by a Spanish military expedition that landed in 1814. Not by coincidence, El Libertador, Simón Bolívar, wrote that the true enemies of independence were the excessive power of the provincial governments and the lack of a central government that could promote cooperation among the different regional entities. The Spanish reconquest of New Granada was part of the 1814 restoration plan that included abolishing the liberal constitution of 1812 and setting up an absolutist government in the Caribbean and in the northern part of South America, starting from Caracas. Thus the restoration plan began in Venezuela, not just because of its strategic importance but primarily because 104

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in that region the political void created by the abdication of Ferdinand VII had given rise to unusually violent politics, such that the transition from autonomy to independence was almost imperceptible. The creation of a provisional collegial government on April 19, 1810, forced the governor to resign and leave Venezuela. While some provinces recognized the new government, the others sided with the Spanish regency and forced the junta to convene a congress in 1811. The congress consisted of a majority of moderate representatives and a minority of radicals organized by Simón Bolívar and the Girondine revolutionary Francisco Miranda (who had returned home after a long exile) into the Patriotic Society. In conclusion, the radical minority managed to have the congress declare the independence of Venezuela and adopt a federal form of government. The 1811 constitution was the first in the Iberian world to explicitly assert the rights of man and of citizens and set down a clear division of powers, with the legislative branch dominating; the other Latin American constitutions would follow the Venezuelan example. The first Venezuelan republic (it was also the first republic in Latin America) was born surrounded by powerful enemies: the autonomist monarchists who dominated in Coro, Maracaibo, and Guyana and refused to recognize the authority of the Caracas government; the Church; and the Caracas elites, who sought more power for themselves through the property-based suffrage law approved by the congress. The law had caused deep discontent among the nonwhite populations, who demanded to be treated like citizens, because, for one, they had served in the militia. In 1812 the divisions among the elites and the mobilization of the populace, along with the support of the Church hierarchy, led to the restoration of the monarchy, which took place without Spain’s military assistance. As a result the demands of the lower classes turned into riots, slave insurrections on the plantations, and the formation of armed bands on the interior plains and along the coast. Bolívar, who had sought refuge in Colombia, reflected long and hard on the fundamental errors of this first republic and identified them in a federal constitution: insufficient power assigned to the executive branch and failure to curb the demands of the lower classes. He then devised a strategy to liquidate the advocates of absolutism, identifying them essentially as foreigners—Spaniards—and making them the scapegoats for the misery in which the nonwhite population lived. With the support of areas that were still held by independentists and of the moderates who suffered the royalists’ violent repression, Bolívar embarked on the conquest of Caracas from the Venezuelan Andes. His victory gave him absolute power, which the new congress ratified in early 1814. Wielding his dictatorial powers, he impleT h e N e w S tat e s A r e B o r n

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mented policies that pitted Americans against Spaniards and heightened social tensions, causing his support among moderates to dwindle. These rifts continued to deepen even as Bolívar tried to restore order on the plantations that had been occupied by slaves, failing, however, to defeat the armed royalist bands that roamed the hinterland. A law approved by the First Republic turned the occupants of lands with livestock into owners of those lands, forcing those who owned no livestock to work on the ranches and sparking the plains (llanos) insurrection. The response, led by the antirepublican elite with aid from Spanish troops, culminated in the reconquest of Venezuela in 1815. The autonomist movement was the high point of the cultural and political transformations of the Enlightenment and of Bourbon reformism, and it was the end result of the search for a new constitutional order that could guarantee the equality of Spanish-Americans before the law. The regional interests and the insurrection of the lower classes thwarted and added drama to this search for a new order within the monarchy. In fact, in New Spain the repression by the viceregal authorities led to riots in the farming and mining regions north of Mexico City, the Bajío (lowlands), spurring a movement similar to that of the Peruvian Túpac Amaru and the 1780s Comunero Rebellion in New Granada, although the leader of the Bajío movement, Miguel Hidalgo, a parish priest, strongly believed in constitutionalism. The insurrection of September 16, 1810, erupted ten days before Viceroy Francisco Javier Villegas, appointed by the regency, called for elections to the Cortes and, acceding to the rioters’ demands, abolished the personal tax on the nonwhite populations. The viceroy was so worried about the insurrection that he ordered the army commander to suppress it, which was accomplished in less than three months. Even after Hidalgo was executed and the movement dispersed, the military could not easily wipe out the insurrectionist tendencies because the movement had branched out in the cities and among the upper classes, especially in Mexico City. In fact, the unusual aspect of this movement was its mélange of political demands and redemptive, millennialist expectations of the Kingdom of Christ on Earth. For this reason Hidalgo’s movement lived on even after his death. The movement that took its place, led by José María Morelos, inherited all the contacts with the secret societies and with many members of the old leadership. However, Morelos shifted strategy and, as the Spanish had done against the French, organized guerrillas and attacks in the areas with closest ties to the capital, such as Puebla and Oaxaca. Morelos’s insurrection was more strongly constitutionalist, perhaps to reverse the effects of the demobili106

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zation generated by the implementation of the Cádiz constitution in Mexico that called for municipal self-government and the birth of regional consulting bodies. The Constituent Congress met in Chilpancingo in September 1813 to draw up a constitution; one faction favored a strong executive branch, the other more power for the legislature. The outcome was the 1814 constitution that established an executive triumvirate and a strong legislature; it was the last important achievement of the independentists, who would be defeated by 1815. The monarchic restoration had also begun in Mexico.

Independence I have already noted that Spain’s reconquest of its former colonies coincided with the restoration of monarchies all over Europe. The Latin Americans proclaimed their independence just when the Holy Alliance was strongest, so they faced a negative international context. In fact, the Spanish strategy for restoring order called for military expeditions of three thousand men each to the Caribbean, Mexico, and Río de la Plata and the support of the French and Russian courts, as well as an intense diplomacy to secure British support, offering to Great Britain in turn a privileged trading position with Spanish America. The only support that Spain failed to secure was that of the Spanish-American moderate elites, who sided with the independentists. The transition to independentist convictions was much less dramatic than has been depicted, because it was the same political actors—the autonomists who wanted to reform the Spanish monarchy—who increased the initially small independentist ranks. Both the autonomists and independentists favored constitutionalism, and neither as yet had a clear idea of the more appropriate form of government for each country, a republic or a monarchy. The result was that the real conflict in Spanish America between 1820 and 1850 was between monarchy and republic and whether the form of government should be unitary, a confederation, or federal. On the subcontinent the restoration brought about a unifying tendency that was visible in the forms of cooperation between the different regions and that led the general congresses to proclaim their independence from Spain and agree on strategies to defeat the Spanish armies. From 1814 to 1820 people became more convinced than ever that any Spanish presence on the continent was a threat to the independence of all the countries. This newfound solidarity made the liberation armies of Bolívar and José de San Martín possible. The region least affected by the restoration, despite Spain’s many plans to reconquer it, was Río de la Plata. Here too there was a gradual decline of the T h e N e w S tat e s A r e B o r n

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more radical Buenos Aires factions and in the hinterland regions a growth of moderate groups that demanded more presence in the government. The congress that met in Tucumán in March 1816 brokered an agreement among the elites of Buenos Aires, Cuyo, Tucumán, and Córdoba that allowed independence to be declared and the first head of state elected. President Juan Manuel Pueyrredón pledged to support the continental army that was being organized in Mendoza under the command of San Martín to fight for the independence of Chile and wipe out the principal base of the absolutist viceroyalty of Peru. This was a huge undertaking for a government that had few resources, whose authority was not recognized by the Salta and Uruguay regions, and that was threatened by the imminent landing of a Spanish army in Buenos Aires. The support that Pueyrredón’s government gave to the Argentine and Chilean army in Cuyo, the region to which Bernardo O’Higgins’s group of Chilean independentists had fled, was born from the belief that the best way to defeat the powerful absolutist stronghold in Peru, which threatened the independence of the entire Río de la Plata area, was to promote the birth of an independent state in Chile and use a naval squad to move on Lima, the viceregal capital near the ocean. Armed with his military experience, and supported by the Chileans, San Martín proclaimed the freedom of the slaves enrolled in his army, built an army approximately five thousand strong, and crossed the Andes. Between early 1817 and April 1818, the Chileans defeated the Spanish army, which the new naval fleet led by Lord Cochrane finally drove from Chile. Then the new independent government of Chile under Bernardo O’Higgins pledged to sail the liberation army to Peru as soon as possible. When he left for Peru, San Martín was well aware that without the support of the autonomist Peruvian notables he would fail in his endeavor; his strategy to win their support lay in the realization that in Peru, just as in Mexico, the 1812–14 constitutional period had had a strong impact. In the face of Viceroy José de Abascal’s opposition, the constitutional period had created deep expectations, which were suppressed after the Creoles realized that such an attitude would encourage insurrections like those that had erupted in the Indian areas of Huánuco and Cuzco (1812–14) and recalled the 1780s rebellions of Túpac Amaru and Túpac Katari. The fear of insurrection, intelligently exploited by the viceroy, had halted the transition to independence in Peru. For this reason San Martín preferred to apply pressure on the elites’ commercial interests by blocking the principal Peruvian ports instead of landing his troops; in this way he secured the Creoles’ support and took Lima without firing a shot. But the surrender of Lima did not end 108

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the viceroyalty because the colonial authorities still controlled the major centers, especially the Potosí silver mines. The Spanish liberal revolution of 1820 became San Martín’s principal ally because it split the monarchic forces: the viceroy was deposed, and the military commanders, many of whom had been born in Peru, chose independence. Even though Peru proclaimed its independence in 1821 and San Martín was appointed protector, the drive of the Argentine-Chilean army died because the two countries withdrew their support and the Peruvian notables showed a lack of interest in governing their own country. For this reason, after he met Bolívar in Guayaquil in 1822, San Martín decided to leave Peru and transfer power to Bolívar. Simón Bolívar’s continental army had begun to form after the independentists landed in Guyana with the support of the black Republic of Haiti. During his Jamaican exile in 1815, Bolívar had perfected his strategy and, based on his recent experience, had realized that he needed to secure the support of the more moderate groups. He did it by eliminating Manuel Piar, a mulatto general who advocated the extension of political rights to nonwhites; Bolívar accused him of fomenting a racial war, although the general had formed a successful alliance with José Antonio Páez, the head of the former llanos monarchic movement. Still, the independentist forces were again defeated by the Spanish army, forcing Bolívar to reorganize militarily on the Casanare plains in Colombia with the aid of Francisco de Paula Santander, while Páez faced the Spanish forces in the Venezuelan llanos. The revolutionaries’ victory at the Battle of Boyacá (August 7, 1819) led them to occupy Bogotá and gradually overpower the Spanish army, which was finally defeated at Carabobo in Venezuela on June 24, 1820. The goal of Bolívar’s army had been to bring about the state of Gran Colombia, consisting of Venezuela, New Granada, and Ecuador. This new republic was approved by the congress that met in Angostura on February 15, 1819, and reaffirmed in 1821 by the Carabobo Constituent Congress. To reach this goal Bolívar’s army had penetrated Ecuador where it met up with San Martín. Then the continental army, made up of Gran Colombians, Peruvians, Chileans, and Argentines, had defeated the Spaniards at the Battle of Pichincha (May 24, 1822). The continental army’s great offensive began in 1824; in the same year the Spanish army was soundly defeated in Ayacucho, in the Peruvian Andes, thus marking the end of the Spanish domination of South America. In Mexico as well the monarchic restoration had curbed the more radical groups, which had come to recognize that the participation of the masses could be a source of danger, not just politically but also for the economy and T h e N e w S tat e s A r e B o r n

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society. Obviously, moderation did not mean renouncing the idea of autonomy or of independence, but rather it meant trying to keep the demands of the various classes, including the masses, on the constitutional path. Unlike Peru, this realignment of political expectations toward moderation was the work of the viceregal authorities, who, while expanding their army, also made an effort to win back the notables’ trust. Still, New Spain’s interest in a constitutional order did not decrease; in fact, the 1820 return to a constitutional monarchy was well received by all. The viceroy reestablished the 1812 constitution, called for the election of new Mexican deputies to the Cortes, and restored the provincial assemblies and the municipal councils. The return of political activity in Mexico and the renewed interest in a constitutional government contrasted with the feeble interest in the new Cortes. Unlike in 1812, the Latin American proposals for autonomous kingdoms with their own Cortes and government, subsumed under a Spanish monarchy, were no longer considered. In the 1820 Cortes the clash between the liberals and the supporters of the absolute monarchy was too strong to entertain projects of institutional reform. Once the constitutional order was reestablished, the fractures in the Mexican political elite came to the fore, and the majority that favored a constitutional government split between republicans and monarchists. Faced with a republican party that was increasingly growing stronger, the monarchists opted to create a constitutional monarchy supported by the military, whose strength had grown from 1808 to 1820. Agustín de Iturbide, the highest-ranking and best-regarded Creole military officer, took on the task of peacefully carrying the country to independence by leading the “Three Guarantees Movement,” which was made up of civilians and members of the military who supported Catholicism, the monarchy, and the constitution. After securing the armed support of the independentists, the constitutional monarchic party signed an agreement with the Spanish representative calling for the independence of Mexico, ascent to the throne of a Spanish prince, and convocation of a Constituent Congress (September 28, 1821). In Brazil for almost ten years, especially after the arrival of John VI, the liberalization of trade and the new status of kingdom had promoted a territorial reorganization that satisfied the regional elites and guaranteed a peaceful political climate that encouraged the dissemination of new ideas about the country’s future. The repeated concessions that the crown granted the Brazilian notables—such as the end of the ban on manufacturing, inauguration of a manufacturing incentive program, and progressive replacement of the army and civil servants with Brazilian natives—certainly brought about 110

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a modicum of peace. But the harmony began to deteriorate in 1820 in the wake of Oporto’s liberal revolution that led to the break-up of the country, as had happened in Spanish America. While waiting for the extraordinary meeting of the Constituent Congress in November 1820, each of the nineteen existing captaincies general became a province provisionally governed by an executive board. In Rio de Janeiro the constitutionalists forced the king to adopt the Cádiz Charter while waiting for the new constitution and to reorganize the council of ministers by including supporters of constitutionalism. The impact of the liberal revolution was dramatic: notables, officials, officers, merchants, and churchmen who favored the constitution wanted the court to remain in Rio de Janeiro, while a small minority sought the king’s return to Lisbon. In conclusion, the majority of the two hundred Cortes deputies, seventy of whom were Brazilian, asked the king to immediately return to Portugal. In Brazil, as in Spanish America, the supporters of constitutionalism were not only members of the elite but professionals—tradesmen, merchants, priests, and soldiers, many of them mulattos or black freemen from the lower classes. All demanded the extension of political rights, and some favored a republic. This faction, perhaps too hastily called radical, curbed the moderate constitutionalists, both those who wanted the king to stay and those who wanted him to leave. In fact, the moderate wing felt the impact of the European Restoration and feared that an extension of political rights to the lower classes might lead to slave riots, engendering a situation like Haiti’s. The fear that the “colored” classes might join in the political arena was a constant in all Latin American countries but certainly far greater in areas such as Brazil with its large slave population. Unable to satisfy both the Brazilian and the Portuguese factions, John VI decided to send Prince Pedro to Lisbon to force the Cortes to recognize the autonomy of the kingdom of Brazil with its own parliament. Finally, John VI resolved to leave and appointed Prince Pedro regent of Brazil while the elections for the Cortes deputies were being prepared. In 1820 the elected deputies, both the liberal moderates who were in the majority and the liberal radicals (some of whom had taken part in the 1817 Pernambuco riots) still were in favor of the political autonomy of Brazil under the monarchy. In fact, the Brazilian autonomist deputies opposed the majority of deputies who had been elected in Portugal and wanted to return Brazil to the status of colony, restore the trade monopoly, and return to Lisbon all the institutions that had been moved to Rio de Janeiro in 1808. The Brazilians’ dissent in the Cortes translated into a petition to the Regent Dom Pedro to not leave Brazil; the T h e N e w S tat e s A r e B o r n

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prince acceded and abrogated the authority of the Lisbon Cortes, maintaining the unity of the different currents that favored independence under a constitutional monarchy. On June 3, 1822, the regent called for elections to the Constituent Congress; on September 7 independence was proclaimed, and on December 1 Dom Pedro was crowned the constitutional emperor of Brazil.

Trade Flexibility, Industrial and Fiscal Challenges Starting in the 1820s, Latin American ports became far more cosmopolitan: ships flying the flags of different countries docked, visitors spoke languages other than Spanish and Portuguese, Protestant and Anglican churches were erected, Parisian fashion became popular, people drank previously unknown beverages such as tea, trade newspapers appeared, and international news began to take up more space in the press. Also, the supply of consumer and semifinished goods became more plentiful and diversified, and their prices fell. But these changes were slow to seep into the hinterlands of the various countries, because of social resistance to change and such obstacles as the persistence of coercive markets, corporatist restrictions, and traditional economic arrangements. Surely, another contributing factor was that as one left the coastal towns, villages became smaller and more scattered, although the hinterland was by no means without hamlets or productive activities. The central problem of the subcontinent’s economy at the time was that, even after all the changes, both the new and the old industrial areas were failing to exploit all the benefits of free trade. In fact, infrastructure in the hinterland saw no real improvements, although several projects were under study to turn old colonial roads into carriage roads, build navigable canals, and open new roads. The gap between the modernity of the coast and the immutability of the hinterland grew because free trade stimulated competition among the shipping fleets, which led to a rapid reduction in maritime freightage between the European and the American ports. Meanwhile obsolete infrastructures in the interior kept transportation costs high, reducing the competitiveness of locally produced goods on foreign markets and favoring the persistence of forced regional markets. Additionally, some segments of the population consumed only food staples and goods produced locally and exchanged them through barter, deferred exchange, or even payment in workdays (salary in kind). In the 1850s about half of all Latin American production was probably consumed outside a market, that is, outside transactions regulated by a pricing system and by payments in currency. Still, international commerce increased production from the end of the 112

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eighteenth century to the first half of the nineteenth. In this period the number of workers increased, and new production centers appeared, both to feed a growing population (which grew at a rate higher than Europe’s) and to meet an expanded European demand for agricultural and mining products. And, in fact, new mines were excavated, virgin lands were turned into farms, forests were exploited, and manufactories opened in many regions. This expansion occurred both within the existing industrialized regions and in new ones in the province of Buenos Aires, in São Paulo in Brazil, Concepción in Chile, Antioquia in Colombia, and in northern Mexico. In the previous century these were regional economies that had been trade destinations and road crossings; now, local resources and labor were exploited more effectively, minimizing the high cost of transportation. The breeding of livestock in the south of the Buenos Aires province is a good example of this change: between 1815 and 1838 ten thousand people lived in this vast grazing land, two thousand of them workers who mostly tended livestock; in 1850 three thousand workers handled sheep production, about 4.5 million head, in the same province. The increase in production in this period still seemed to depend on the possibility of identifying a process that could combine fewer workers with underused natural resources. Still, these areas had changed: the new settlements were no longer peopled by poor laborers organized in what essentially were labor gangs but by families with some productive skills, tools, and labor power. These new settlers occupied and took possession of state-owned land, exploiting the political and administrative chaos left by the wars of independence. The social mobility caused by the wars and by the liberation armies probably favored this type of colonization, although for the most part regular soldiers, unlike officers, did not receive land grants as compensation for their service. A look at the staples that filled both local and international demand— leather and hides, salted meats, lumber, gold, silver, and copper—makes clear the continuity between the old and the new production areas. In this sense the colonization of the early nineteenth century may not seem innovative compared with earlier periods, since farming and husbandry methods, metal extraction, and the production of lumber did not require innovative techniques, although the volume of goods produced did grow. Despite the European prejudice against the republican form of government adopted on the subcontinent, European businessmen—the British in particular—established mining companies there. One company, Real del Monte, exploited the important silver mines of Pachuca (Mexico) but failed, T h e N e w S tat e s A r e B o r n

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primarily because it made insufficient investments in new technology that could more efficiently exploit low-alloy minerals. The company’s accounting records show that only 10.4 percent of its total capital (£977,000) was fixed capital—machinery, tools, and metal extraction and processing plants. In Minas Gerais, Brazil, a region that had experienced a gold boom from the end of the seventeenth century to the first half of the eighteenth century, several British concerns founded mining companies: from 1824 to 1846 they set up six mining companies with a par-value capital of more than half a million pounds sterling and a production capacity of about 100,000 kilos of gold annually. Of the six, only one, the St. John d’el Rey Mining Company, established in 1830, was successful, producing seventy thousand kilos of gold a year from 1830 to 1860. Unlike the mines in Mexico, this one had an innovative organization and use of labor: it introduced mine extraction of gold instead of the old alluvial extraction method and used a large percentage of slave labor. Of its two thousand miners, fourteen hundred were black slaves either owned by the company or leased out by private individuals. Thus in Mexico and Brazil the mining industry rested on two factors: plentiful material, scarce labor, and low technology, for steam power became widespread on the subcontinent only after 1850. The mining industry is a good example of abundant raw materials that favored an extensive type of production that required little labor; hence it had little use for fixed capital, and the mining, agricultural, and livestock concerns preferred to train specialized labor in order to increase productivity without increasing their investment in fixed capital. Next to the miner who extracted the ore and the laborer who carted it away begin to appear mining squad bosses and skilled miners who can identify high-alloy veins. The same phenomenon applied to farms: from 1800 to the 1850s arrangements diversified to include sharecropping, minority shares in the crops, and oral contracts for sale of the harvest. In one popular arrangement that appeared in the 1700s, small and medium-sized farmers and livestock ranchers kept close ties to merchants and big producers, selling them their crops even before the harvest, in exchange for advances of money and goods. Thus production increased, and workers consumed a smaller percentage of it. That is, the growth in volume depended on increased production and better marketing techniques. The latter are reflected in an important change in the latifundios, which were now subdivided into specialized lots that were managed independently while remaining part of the general organization of the estate. This more complex organization, undetected by many historians, appears as ranchos, parcelas, or hijuelas—subdivisions of the latifundio 114

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owned by the same family and under the same management, into lots of one hundred to two hundred hectares, each used primarily for a single crop or type of livestock. Until the 1850s an imbalance persisted between plentiful natural resources and the limited supply of labor, probably because the population growth rate in 1800–1850 remained roughly unchanged from the previous three decades. Although this imbalance led to increased productivity in the older established regions and in newly settled areas that produced high-value goods such as gold, it also motivated people to move to virgin areas, thereby improving the conditions of those who stayed behind in the older settlements. The labor shortage was exacerbated by the system of property rights, which were all but nonexistent in the spontaneously settled regions and were not based on title but on the physical occupation of lands that were state property. These new settlers could not be dispossessed, since the colonial laws in force until at least the 1850s did not prevent peaceful possession, on condition—as documents of the time state—that the land be “populated,” that is, occupied productively. This explains the existence in the newly colonized areas of multiple property rights that no government has been able to settle to this day. The relative rigidity of the labor supply, confirmed by the persistence of slavery and the demand, starting in the 1840s, for European labor, translated into different forms of labor in the traditional areas, especially on the latifundios. It also accounted for the presence of many small and mediumsized producers in the newly settled regions. In this type of situation the commercial agents applied pressure on the property owners and the owners of usufruct rights, essentially by controlling marketing, because the demand was concentrated in a few hands, whereas supply came from a variety of small producers. My analysis of the supply of products offered on the market and the demand of consumers and commercial agents shows that the expansion and diversification of the supply muted the oligopolistic character that had been a feature of the market at the end of the eighteenth century, when the supply usually came from a few merchant-producers. This illuminates the major positive change that occurred in the decades that followed: the higher price of exported goods and the stable prices of imported goods, especially semifinished materials. In Venezuela the oligopoly of merchant-producers was weaker because more producers had agents in the exporting ports. And although the price of coffee on the Amsterdam market—the principal market worldwide for non-European goods—increased only 18.6 percent from 1830 to 1840, the T h e N e w S tat e s A r e B o r n

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price of coffee at the Venezuelan exporting port increased 73.2 percent in the same period, and the volume exported grew even more, 125.2 percent. Even if brokers’ fees partially accounted for the price difference between plantation and port of departure, the rise in the volume of produced and exported coffee spurred production even more, promoted the expansion of trade, and led to an increase in the number of producers and commercial brokers. This expansion phase cannot be easily quantified for two reasons: the changes in public administration did away with several departments without creating new ones to monitor production and trade; and, more important, growth was essentially regional, and many businesses were organized informally. Therefore, to understand production and commercial growth in this period it is necessary to use indicators and differentiate between changes in the production of goods that were already in place at the end of the eighteenth century and in products whose volume grew between 1820 and 1870. Two Brazilian commodities are a good example of the regional diversities: sugar, an old commodity from northeastern Brazil, and a new one, coffee, from central and southern Brazil (Rio de Janeiro and São Paulo especially). In 1821–23 and 1851–53 the volume of exported sugar tripled, from 41,900 to 133,500 tons, while its value rose only 90 percent, from £1 million to £1.9 million; on the other hand, coffee exports multiplied fourteenfold, from 11,000 to 145,000 tons in the same period, and its value rose fivefold, from £790,000 to £3.9 million. The slump in international demand from 1825 to 1850 stimulated the growth of new commodities, while the price of traditional colonial goods such as sugar and cacao competed with identical crops from other American regions. For example, while Brazilian sugar exports grew at a slow pace, Cuban sugar exports experienced a veritable boom. In 1821–23 and 1851–53 Cuban sugar exports grew almost sixfold, from 65,700 to 362,300 tons, while their value only tripled, from £1.5 million to £5 million because the price fell on the international market. Similarly, Venezuelan coffee exports tripled, from 52,000 to 179,000 tons, while traditional cacao exports did not even double, from 13,500 to 24,500 tons, in 1831–36 to 1846–51. It is reasonable to infer that production of commodities that had been almost nonexistent toward the end of the eighteenth century is a reflection of the skills and productivity of the local economies and their capacity to react to negative stimuli from international demand. This ability to seek and find new foreign markets also was evident in mining and nontropical farm products. The export of hides and tallow from Buenos Aires multiplied 2.6 times for hides (from 86,600 to 230,700 quin116

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tals) and forty times for tallow (from 4,600 to 200,400 quintals) from 1820 to 1850. The value of new Peruvian exports of alpaca wool went from £2,400 to £216,900 from 1823 to 1850, while the export value of guano (from the Peruvian coastline) multiplied seventeenfold, from £81,000 to £1.4 million. The production of copper from northern Chile also grew between 1820 and 1850, from 11,000 to 110,00 quintals. In conclusion, Latin American production and exports in the period following independence showed not only continuity with the colonial period but also discontinuity because growth was mostly in farming, livestock, and mining, all commodities with a low unit price. At the same time the ratio of exported volumes to export revenues suggests deterioration in the prices of goods that were already being exported at the end of the eighteenth century—such as cacao, hides, leather, and sugar—whereas the prices of new export products were increasing. Undoubtedly, these efforts would not have been possible without the liberalization of trade and increased competition among European businesses in Latin America; in fact, the number of ships increased, while freightage diminished substantially. Next to these changes, which have been little studied until now, are others that also have not been considered, such as the birth of financial brokerage houses to handle payments and new commercial credit instruments. The first half of the nineteenth century saw an expansion in the use of notes as a form of payment between manufacturers and merchants, discounted by national and foreign traders-exchangers; their popularity went hand in hand with the expansion of commercial networks and the presence in the hinterland of commercial agents, who further promoted the exchange of export goods for European products. This expansion of production and commerce was surely hampered by the lack of change, or insufficient change, in the organization of finance and by the lack of liquidity of the new independent governments. As I have noted, insolvency blocked the access of Latin American countries to the London capital market. At the same time all the new states had problems increasing their public expenditures because they could not bring in sufficient revenues. Some countries were in such disarray that they had to resort to seizing private assets and even Church property to pay off debts contracted with domestic and foreign trading and exchange houses. In this period civil servants were frequently paid with notes bought by merchants and private speculators at half or even one-third of their face value, while the merchants recouped the total value by discounting the notes in the customs houses to pay import duties; speculators recouped their money as a result of their close relations with administrators and politicians. T h e N e w S tat e s A r e B o r n

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The financial chaos of the new states resulted from the impossibility of preserving the colonial fiscal system in a context that was intended to liberalize the domestic, and especially the international, economy and in some countries reabsorb the huge public debt created during the wars of independence. The high public debt also had been caused by the gap between public revenue and public expenditure. The fragility of public finances was a result of the erosion of the old administrative practices and the state’s reduced ability to impose taxes. All the fiscal reforms of this period, which reveal how important the issue was to the ruling class, created only more chaos and further reduced the ability to collect taxes and duties. The failure of the reforms meant that the many new and old interest groups in the various countries were opposed to an administration that still used colonial-period structures and demanded new and improved roads, ports, and railways in return for some of the taxes paid. In fact, unlike the old antitax riots, new protests by the middle and upper classes took the form of demands to the national and regional governments to improve the infrastructure, fight the highway robbery that was a bane in the countryside, stop smuggling, and further liberalize trade by opening up ports and river navigation to foreign ships. Satisfactory performance of the regional economies in the first half of the nineteenth century was thus stifled not so much by outside forces as by the obsolete infrastructure, old-fashioned corporatist forms, and excessive regulations. This network of interests partially explains why this period was an incubator that would prepare the way to Europeanization.

Social Continuity and Discontinuity The image I propose of this first rapprochement between Latin America and Europe is not the one usually found in histories of the period. In fact, although most historians concur that during the wars of independence society became more dynamic than it had ever been under colonialism, this dynamism disappears as if by magic in studies of the postindependence period, supposedly because the mobilization for the Herculean struggle had run its course. But there is much evidence to the contrary. A study on the growth of small and medium-sized producers in rural Chile from 1830 to 1865 reports that in 1865, about 30,000 of the 116,000 Chilean farmers, or 26 percent, owned land; of these, 7,000 were latifundio owners who owned more than half of all farmland. Other studies show that, next to the foreign merchants whose number continued to increase after independence, a new group of American merchants appeared who did not come from the traditional families of the colonial era. 118

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Examples of the social diversification of this period are plentiful and appear almost everywhere on the subcontinent; they raise questions about, if not disprove, the traditional image of a society marked by polarization of the elite and the masses. They point out that the real problem of Latin American societies from 1800 to 1850 was the transition from a rank-based corporatist society to one divided into economic classes. In other words, in this period began a process that would last more than a century in which society moved from being centered on the family unit dedicated to prestige, honor, and wealth to being based on the individual and individual values and organized around income from the individual’s work. Thus it is worthwhile to look closely at the process of social secularization ushered in by the newly guaranteed individual freedoms. The first step is to analyze the long, protracted process that undermined, then broke up, the two elements around which colonial society was built, which I identified in chapter 2 as the principles of hierarchy and territory. Latin American societies were not uniform: the hierarchical stratification of families and heads of household was not identical everywhere. In each region, especially the more recently settled ones, traditions of wealth, prestige, education, and even honor were not the same as in the capitals or, more generally, in the regions that had been occupied since the conquest. Nor did the old social forms vanish quickly. In fact, the monarch always co-opted the new Brazilian elites in the first half of the nineteenth century based on a double criterion, the local power of the aspiring aristocrat and his political and administrative merits. Being a rich landowner did not guarantee a title of nobility; good service to the crown was also a requirement. The brother of the second baron of São Francisco, Joaquim de Araújo Aragagão Bulcão, was included on the eligibility list for nobility not just because he was a plantation owner but primarily because he had served the monarchy in the imperial legation to Paris. Sancho de Bitencourt Berenguer was made Baron de Rio Fundo for his service as colonel in the royal army and because he was related to several notable latifundio owners. Taking these requirements into account, along with the requirement that the nouveau aristocrat had to reside at his own expense in the imperial capital of Petrópolis, one could argue that the expansion of the Brazilian nobility explains the expansion, in turn, of several notable groups in Brazil. From 1808 to 1889, 1,318 individuals received titles of nobility: 67.6 percent became barons, 20 percent viscounts, and 12.4 percent counts, marquises, or dukes. Thus the Brazilian nobility increased and became diversified. These titles probably drove the regional elites to build alliances through marriage with the new aristocratic families. T h e N e w S tat e s A r e B o r n

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Nineteenth-century Brazilian nobility reflects the erosion of the old corporatist criterion, with the extension of the social ladder to the nouveaux riches and the civil servants who had served in the royal administration. New criteria based on economic value (income and management skills) and individual merit (ability to create new wealth and to be good administrators) began to emerge. In continuity with colonial society, however, the social subject was still not the individual but the head of household—the family patriarch. In the erosion of the old colonial order hastened by the wars of independence, territorial expansion, industrialization, and the political-administrative chaos in the years after independence, an important factor was the extension to the new subjects of the old classification of vecino. Starting in the 1820s, the condition of vecino (vezinho in Portuguese America) denoted a head of household who lived honestly by his work, whether a profession, trade, or commerce. This new classification was assigned in Chile even to men with low incomes; in Mexico even to miners; and in Brazil to all heads of household who had stable residence in a parish. This qualification is important because it allowed the head of household to vote in the new electoral system and to be eligible for office, join the civilian or republican guard and bear arms, serve in municipal and regional governments, and even aspire, in the only monarchy left in the Americas—Brazil—to a title of nobility. The spread of a type of equality that had been reserved to the notables was, as I have noted, advanced by the new political and institutional order and also by the elimination (begun in the previous century) of the ethnic-racial status of the head of household. The colonial differentiation of people by color that also denoted a social rank gradually disappeared, further accelerating the process of intermixture in the population and the adoption of European languages, both written and oral, especially Castilian Spanish and Portuguese, which thus began to take on the connotation of “national” tongues. The intensification of social differentiation in capitals such as Mexico City, Rio de Janeiro, and Buenos Aires does not mean that the society was becoming polarized. With 120,000 residents in 1842, Mexico City continued to be the largest Latin American city, and it is reasonable to infer from various activities of the population that it had upper, intermediate, and low social statuses. The social differentiation of Mexico City was also present in areas with large black slave populations, such as Bahia in Brazil, which had intermediate figures who were not slave owners but lawyers, physicians, merchants, officials, manufacturers, and tradesmen. Even if these new social actors had an elitist conception of society, they did not share the interests of the leading 120

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merchants, large landowners, or politicos. This would explain why in this part of Brazil (this phenomenon also occurred in Buenos Aires, Santiago de Chile, Caracas, and Mexico City) notable families began to co-opt newly successful individuals such as merchants. The process of social differentiation also extended to the nonpropertyowning classes, as many tenant farmers began to have incomes higher than those of some landowners. Even the masses became differentiated: the farmhands were classified into those with year-round work or seasonal work, and those who were held on the land to pay off their debts to the owner or because they could not collect the money owed to them. Add the different forms of sharecropping and métayage, and it becomes clear that the rural world at the time could not be simply described as one of slaves and owners or servants and masters but was a multifaceted reality that adapted to meet the needs of different kinds of production and demands. In 1842 Mexico City was very differentiated occupationally: about twothirds of the working population was engaged in a trade, manufacturing, commerce, the professions, or clerical work. This is a high percentage, typical of a large capital, but it also occurred in more modest provincial cities such as Querétaro in Mexico, which in 1845 had about one thousand tradesmen, five hundred manufacturing workers, and more than seven thousand women household servants, some of whom worked in factories. The plurality of occupations was not peculiar to Mexico, however, for in São Paulo—in the 1820s a modest provincial capital of twenty thousand residents—2,176 individuals were actively employed, half in farm work and the other half in military or civil service (17.8 percent), trades (8.8 percent), commerce (7 percent), construction (5.4 percent), and the Church (4.9 percent). Many more statistics confirm this tendency and show that in Latin American cities, just as in Europe, in the mid-nineteenth century elite families still lived side by side with the lower classes though without mingling. For this reason the values, attitudes, and customs of the various classes began to homogenize and were influenced by the lifestyle of the elites who continued to reside next to the less fortunate. This urban coexistence developed forms of paternalism that were also a feature of life in the countryside and in manufacturing towns, a paternalism reinforced by the persistence of unequal work relationships based on oral contracts, with salaries only partially paid in cash, workers forced to purchase products in the company general store at usurious prices, and farmers forced to sell their harvest to the latifundista at substandard prices. Undoubtedly, the bonds of dependency were weaker in the rural areas abutting the cities, where farmhands, farmers, and sharecroppers could T h e N e w S tat e s A r e B o r n

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sell their crops on the market for more money. Most probably, even a modest exchange of products for currency in the first half of the nineteenth century led to an emancipation of workers. New types of occupations began to emerge to fill a demand for workers in the service of the notables. Thus the number of law graduates and practicing attorneys rose quickly because they were crucial to the bureaucracy of the new states. The number of graduates of the São Paulo Academy of Law, founded after independence, grew until it reached about fifty per year in the 1850s. Spanish America also saw an increase in the number of institutes of secondary and higher education and of graduates, and drastic changes in the curricula. These changes forced the notables to adapt their class strategies, because the rise of intermediate ranks in the country and the city eroded the old colonial relations, imposing new ones, with both the new ranks and the masses. This process neither destroyed nor bypassed the old patronage system but supplemented it with new forms of clientelism that assigned to the new social figures—minor local notables, professionals, and civil servants, as well as merchants and tradesmen—the role of mediating between the old upper elites and the masses. One source of this change was probably the new organization of labor in the large agricultural, mining, and manufacturing centers, where both seasonal and permanent workers were organized in teams, each headed by a squad boss who reported to a superintendent—the mayordomo—charged with supervising a segment of production. In turn, the superintendents answered to the steward, who more often than not was a poor relation of the owner. The new patronage system identified skilled individuals who were neither strictly owners nor workers and attracted them as intermediaries, allowing the elites to retain their status in this much larger and diversified network, which complemented the old seventeenth-century vertical patron-client relationship. The end result was that some social actors, such as lawyers, administrators, physicians, and artisans, gained not only greater prestige but also a higher status because of their “zipper role” between the elite and the common people. Starting in the early 1800s, a thick, complex network of interactions developed that facilitated a greater integration of the lower classes into society at large. This process is visible in the transformation of organizations, such as city and country militias that became national guards in Mexico, Venezuela, Peru, and Brazil, and in the city militia in Chile: they included soldiers from the entire social spectrum. Another inclusive structure were the new electoral systems founded on property-based eligibility (Brazil, Chile, and Peru) 122

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or on the indirect system (Argentina, Colombia, and Mexico). The indirect system promoted more and better integration because it granted to all male residents (vecinos) the right to vote, while eligibility for election to office was restricted to those possessing other qualifications, such as a school degree and an income, profession, or capital. All these changes, and the increasing importance acquired by the classes that had never held social status before, meant that society was moving from rank-based to merit-based criteria. The main effect of this transition appears in the social lexicon. Groups that, for simplicity’s sake, I had defined as intermediate now tended to be included with the true notables under the classification of property owners. This new definition appears in an 1830 Mexican newspaper that minutely described the property-owning class as those owning real estate or exercising a profession— lawyers, notaries, members of the military, graduates, manufacturers, bankers, merchants, money exchangers, artists, and other citizens paying direct and indirect taxes, who had a vested interest in the health of the government. The new social actors were found throughout the subcontinent. In Minas Gerais, Brazil, despite the apparent dichotomy between owners and slaves, even blacks and mulattos owned black slaves whom they dispatched to work on their small farms or in their retail stores, workshops, or mines, just like white workers did. In the Mexican states of Mexico, Querétaro, Guanajuato, and Jalisco, the statistics illustrate the diversification of this new class in farming, mining, commerce, the professions, and the crafts. Undoubtedly, this expanded property-owning class was especially strong in the cities. In Mexico City in 1842, only 4 percent of the active population belonged to the elite, but a look at the different elements that define the property-owning class at the time shows that almost half the active population had an occupation. A similar conclusion applies to another large capital of the time, Rio de Janeiro, with 191,000 residents in 1870. The population lived in 21,389 dwellings (8.9 individuals per dwelling) and was organized in 34,792 families (5.5 individuals per family), a demography that was still preindustrial, as evidenced by the existence of extended families and patronage or dependency relations among families not necessarily related by blood. Further, almost half the population of Rio de Janeiro had neither work nor skills, while a solid 18 percent of the working population was employed in domestic work. The rest, a little more than a third of the total active population, was distributed essentially like Mexico City’s, across the spectrum of merchants, professionals, civil servants, members of the military, clerics, city real estate owners and rural landowners, and many artisans—15 percent of the active population. In the first half of the nineteenth century, therefore, T h e N e w S tat e s A r e B o r n

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the cities grew not only demographically but also in the complexity of their social network. Urban growth was limited to those cities that already filled multiple roles by the end of the colonial period. While some grew more rapidly than others, other cities continued to grow at a similar or slower pace than the national population. Among those that grew rapidly were Santiago de Chile, Caracas, and Mexico City, while the growth rate of Lima, Bogotá, and Rio de Janeiro was similar to that of the total population. Probably this difference helps to explain why the capitals and port cities were still unable to expand their influence beyond their own region. Analysis of the capitals for their potential to extend their presence nationally shows that Buenos Aires, Santiago de Chile, Lima, Havana, and Mexico City developed this potential, but Rio de Janeiro, Caracas, and Santa Fe de Bogotá did not. This means that in some capital cities an elite was growing that was capable of forming interregional, if not national, ties, whereas in other cities this potential was lacking or grew at a much slower pace. Around 1850 Latin American societies were neither uniform nor national but rather an ensemble of regional mosaics with little communication among them. In each the notable and lower-class families were much more closely intertwined than at the end of the colonial period, engendering new social relations and roles that brought in new social actors. In fact, the 1850s elites were different from their grandparents and their parents, even if their material base was essentially the same: they related differently to their peers and the other classes. A remarkable feature of the American societies of this period is their strong internalization of concepts of the world and society that emerged from the European and American revolutions of the eighteenth century. This change is noticeable in the progressive erosion of religious life and the beginning of a process of secularization that would further Westernize society and politics. Simultaneously, society was gradually discarding, perhaps more quickly than in Europe, monarchic ideas in favor of constitutionalism. In the first half of the nineteenth century the idea emerged that society is essentially an earthly matter, without negating the importance of religion as an individual and collective practice. These views brought about an increased appreciation for the value of literacy and schools; books and the press became more important. Literate culture began to be seen as a tool for social improvement, as witnessed by the spread of the Spanish and Portuguese languages even in areas where Indians still made up most of the population. Slowly, the idea took hold that the 124

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different homelands were all part of a broader reality, the nation, in which all the regional, social, and cultural pluralities could converge.

Institutions and Politics The tension inherent in the social imagination and the political culture of the postindependence period arose from the need to situate the territorial or regional dimension within a broader national or international space. The search for an übergeopolitical dimension went hand in hand with the growing acceptance of constitutionalism and the need to renew the political covenant between the American kingdoms and provinces and the Iberian monarchies. But when the dream of an Ibero-American and a Luso-Brazilian community under a constitutional monarchy evaporated, interest turned, without discarding the constitutional aspirations, to a form of government that could unify the regional entities within the greater political whole. The tension between monarchy and republic that arose in the debate about the form that the states would take underlined the need to project the regional realities onto a new national reality. The idea of nation did not precede or accompany the independence revolution; the idea of nation would begin to take shape once the new independent states chose their form of government. Certainly, the idea of nation was influenced, as it was in Europe, by the political philosophy and romantic literature that had become fashionable in the 1830s; once the enthusiasm generated by achieving independence subsided, the governments began to come to terms with the social and political realities, forcing the ruling locals to reformulate their plans. It was not by chance that, toward the end of the 1830s and in the years after, a new generation of politicians and intellectuals began to question the political philosophy of the independentist generation. The Argentines Domingo Sarmiento and Juan Bautista Alberdi, the Chilean Victorino Lastarria, the Brazilian Antônio Tavares Bastos and the viscount of Uruguay, and the Mexicans Valentín Gómez Farías and Mariano Otero all reflected on the reforms needed to stop fragmentation, discord, and infighting. These thinkers did not all have similar ideas, and, as was the case in Europe, their liberalism ranged from moderate or elite to radical or democratic positions. Next to this intelligentsia reared in urban contexts was another school of thought, both urban and rural, that Sarmiento defined disparagingly as that of the caudillos—the political chiefs. The caudillos had military rank because they had distinguished themselves on the battlefield in the wars of independence or afterward. To better understand the caudillos who, at difT h e N e w S tat e s A r e B o r n

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ferent times, became national leaders, it is important to remember that the entire political class at this time, no matter their education or the urban or rural context in which they came of age, relied on patronage networks that had changed significantly; in addition to the top-down, patron-client relationship, a horizontal one had developed between notable families and individuals of different rank. This was why in Mexico Lucas Alamán, a civilian with great intellectual capacities, could keep up a continuous, almost friendly, relationship with the caudillo Antonio López de Santa-Anna, an uncouth but politically savvy officer. At the heart of the alliances between upper and lower elites and caudillos was more than just interest, because while the old and new patron-client relations were the cornerstone of their political strength, their intent was to create links between the different regions. The elites intended to start a process of political and administrative centralization to end the chaos produced by the disappearance or loss of power of the old colonial institutions; they were also interested in exploiting the new possibilities of expanded international relations, especially those with Europe. The factional conflicts and regional rivalries that are part of the history of all the Latin American nations tell us little or nothing about the motives behind the political class’s actions, its strategies to secure the support or neutrality of the factions, or the policies implemented to ensure governability within the constitutional framework. This oversight is evident even in recent biographies written to reassess this or that politician or caudillo. Ultimately, the institutional reality that the political class sought to build required an essential choice between constitutional monarchy and republic. In the end Brazil chose the monarchy; Spanish America’s choice of republic brought further dilemmas, since these countries then had to choose between a unitary, federal, or confederal system. The political discourse of the time reveals the continued force of the opposition between absolutism and tyranny born on the battlefields of the wars for independence. The idea of territory was so strong that initially a confederation seemed a viable option. The Braganza monarchy in Brazil was an empire that ruled a number of regions that had enjoyed the autonomous status of provinces before the kingdom of Brazil was created. Even Mexico, after choosing the republican form in 1824, organized as a confederation. In all of Latin America the choice proved an arduous process. Chile chose to become a unitary republic in 1833, after almost ten years of debates and clashes; in Argentina the idea of a confederation failed; and Peru and Colombia met with many challenges in trying to set up unitary republics. Undoubtedly, in 126

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this period Latin America was a great political laboratory in which Western ideas were received, analyzed, assessed against local reality and traditions, and converted into constitutional proposals. This explains the great number of constitutions that these countries drew up from 1825 to 1870, in a process of trial and error. Recent studies on the subject document that, in addition to the forces that were trying to direct the various countries to overcome their regional perspective, others fought to reinforce a feeling of localism against the province and a central government. At the local level the new social groups dominated—the families that now became vecinos or had gained political importance through their control of municipalities, civilian militias, and republican guards. In many regions these local politicians were mostly Indian, for example, in Mexico’s Oaxaca, Chiapas, and Yucatán or in the Ecuadoran, Peruvian, and Bolivian Andes. Even in the Argentine pampas and on the southern Chilean plains tribal organizations allied with the Creoles against tribal enemies or to secure benefits. Only after 1850 did the multiethnic cohabitation that had first emerged in the colonial period undergo a significant political transformation. Now that it is clear that the new social actors strove to defend their local interests, it also is clear that they were defending their customs (as many of their documents attest) and their common laws, which varied from place to place and region to region and were not compatible with any form of regional, provincial, or national centralization. In other words, they preferred a government centered on the municipality, similar to what occurred in some parts of Europe (Spain in particular), a solution dictated by the administrative chaos and the failure to implement constitutional guarantees. This form of government was designed to stop the abuses of regional authorities who forced peasants to donate goods and labor for public works, even forcing them to enroll in regional armies. These abuses led the municipalities to organize their own defense with local militias, even electing militia officers and municipal authorities directly. The municipal governments and the militias joined the existing organizations—the guilds and brotherhoods—and created secular forms of social activity, such as town bands, musical circles, the theater, and the first mutual aid societies. Although this phenomenon was more widespread in the provincial towns, it also occurred in villages, where the arrival of the newspaper was an occasion for meeting informally to listen to the news, read by whoever could read, most often the teacher or the priest. Although only lightly populated, the rural areas exhibited a modicum of political cohesion to ward off external threats and reinforce solidarity mechanisms. T h e N e w S tat e s A r e B o r n

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Political and civic education primers and pamphlets full of the new constitutional, republican, and liberal ideas, as well as monarchic ones and arguments in defense of the Catholic faith or a lay state, were popular because of their format, which recalled the oral rhythm and style of the Catholic catechism. The mostly illiterate masses quickly modernized their political ideas as a result of these publications. This cultural transformation translated into political action that tended to emphasize the individual. The struggle for universal suffrage—one head, one vote—was born at this time, when the independent states were being established, and would last almost a century. In addition to the collective actions of individuals, the activities of two major corporate entities, the Church and the army, also had an influence on the formation of these states. The Church had a lesser role than what historians and our contemporary imagination have attributed to it. The Church’s strength lay in the almost total identification of the populace with syncretistic Catholic practices; as the Mexican Lucas Alamán wrote, Catholicism was “the only bond uniting all Mexicans at a time when all the others (monarchy included) had been shattered.” The Church also grew stronger because of the persistence of patronage, a union of state and Church that even the liberals claimed was a right of the independent states. Under the patronage arrangement the Church recognized the right of the government to appoint high church officials. Thus the intertwining of religion and politics was not a plot but the organic outcome of the Church’s importance to the social and cultural life of Hispanic America. The army has been often misunderstood, for many have argued that caudillismo and militarism are one and the same and that caudillismo militarized American societies. As I have noted, although the caudillos were flaunting their military titles, they were not in fact career military but notables self-educated in military matters. As the Argentine liberal Juan Bautista Alberdi wrote, “The caudillo is none other, in the Argentine Republic, than the governor of a province.” This was also true of Mexico and Colombia, as well as Peru and Venezuela, where caudillos were elected presidents of their respective countries. The only exception was the Chilean Diego Portales, a caudillo with no military rank who was not elected president but was, however, a powerful minister of the interior. The etymology of caudillo might shed some light, since it comes from the Latin caput—head—or the person in charge or at the head of a column. Thus the caudillo is someone who, using the new patron-to-patron relationships in his capacity as provincial governor or military commander, and in alliance with other high-ranking politicians, officials, members of the military and clergy, leads a group that 128

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uses the electoral and constitutional system to seize regional or even national power. This strategy makes high-ranking officers fundamental to the success of the politician, in that the officers’ support, or at least their neutrality, can make or break a political career. José Antonio Páez, who was a president maker from 1830 to 1846 and the president of Venezuela from 1861 to 1863, and José María de Rosas, governor of the province of Buenos Aires from 1829 to 1852, maintained their power thanks to the support of regional military commanders and regional notables. Páez and Rosas maintained relationships with both groups that were regularly renewed at each election. The bond between chief and local subchiefs is illustrated by the military network on which the Mexican liberal and federalist caudillo Juan Alvarez relied in the Guerrero region, whose local notables were captains, lieutenants, and vice lieutenants. Unfortunately, it is not known whether the officers who supported the caudillos were from the army or the militia; if the latter, they would be the local notables. This is not a secondary issue, since in the period from the end of the wars of independence to the 1850s expenditures for the armed forces tended to decrease. In Mexico, while the number of army recruits decreased from 22,788 to 5,649 in 1826–50, the militia, about 45,000 to 60,000 men, improved its territorial control, and militia battalions and companies existed in practically all the states of the Mexican Federation. The same phenomenon was at work even in Venezuela, which was considered a highly militarized country: between 1836 and 1848 the number of soldiers decreased from 2,500 to just about 800, but the number of militiamen held steady at 6,000, while the number of militia officers, 423, remained high. When civil war broke out—the so-called federalist war, between the unitarians and the federalists in 1859–64—the number of soldiers increased to 3,500, probably because the regular army incorporated the militiamen who, once peace was restored, went back to their militia status. As the hierarchic principle that combined social and political life in an undifferentiated whole weakened, society began to become distinct from politics, as was happening in Europe. In the case of the peninsula and the subcontinent, this progressive differentiation was made possible by the new role that the head of household, the vecino, took on; this expansion of political equality gradually eroded the old hierarchical order and became manifest in the constitutions of those countries, starting in the 1820s. All of Latin America, both the regions that sent their representative to the Spanish and the Portuguese Cortes and those that refused, such as Río de la Plata, recognized in the head of household, the vecino, the subject who fulfilled the T h e N e w S tat e s A r e B o r n

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conditions of citizenship. In Buenos Aires in 1811 the ruling junta affirmed that the vecinos were “the leading members of a district and the most wholesome” (Molina Martínez 1996: 426). The reputation enjoyed by the head of household led to the eventual replacement of the hierarchic principle with the merit principle, on both the peninsula and the subcontinent, based in the definition of the citizen as a household head who “has a job or a trade or leads an honest life” (Molina Martínez 1996: 426). The merit principle created reciprocity mechanisms that progressively eliminated ethnic and racial distinctions, such that these noteworthy qualities also began to apply to black and mulatto heads of household. Thus the new political actor was not, as in continental Europe, the product of an abstract construction but of an organic development specific to Latin America. The subcontinent also displayed a tendency to base the concept of citizenship on income. Chile was the first country to adopt this criterion: the 1833 constitution stated that the only active citizens with the right to vote were Chileans who could both read and write and had income from capital, a job, or a trade. In 1862 Chile had a total population of 1.8 million but only 22,261 citizens, or 1.2 percent of the total population. The idea of citizenship through income was not widely accepted in other Latin American countries, and although the literacy requirement for voting was contemplated everywhere, the enactment of this law was put off indefinitely. Since the status of citizen applied to all heads of household, the electoral laws introduced an indirect criterion that established two classes of citizenship: those who were eligible to vote and those who, under certain circumstances, were also eligible to run for office. In some jurisdictions in the first half of the century (in many Mexican states, for example), an election had three phases: citizens voted to elect the parish elector, who in turn voted to elect the district elector, who could also vote and was furthermore eligible for election to the provincial assembly or to one of the two branches of congress. An interesting example was the elections to the 1851 Mexican Chamber of Deputies: 581 electors from the various states elected 114 deputies and the same number of replacements. The 581 provincial electors had been elected by 11,620 parish electors, each of whom represented five hundred residents. Finally, the provincial electors, meeting in the provincial capital, elected both the deputies and their replacements, following a system that assigned seats to the minority as well. This system, which distinguished between citizens who could or could not run for office, and divided the first group in two levels, promoted the coexistence of different groups of notables, as well as of various sectors outside the elite. 130

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The 1861 Peruvian electoral law was based on the indirect vote: citizens voted for a number of electors in proportion to the number of inhabitants, and the electors in turn, meeting in the provincial electoral college, elected the municipal council members, senators and deputies, the president, and the vice president of Peru. Pursuant to the 1824 constitution, Brazil likewise distinguished between citizens who could or could not run for office, with the former group further divided into parish and regional electors. Citizens met in the local church to elect some from among their peers, who in turn appointed the parish elector or electors, depending on the number of parish residents. These in turn chose the municipal electors, who elected the provincials, who for their part appointed the deputies to represent the province in the Imperial Parliament. Thus at the first election the province of São Paulo had 115 parish electors, a good number of them militiamen; only twenty-two municipal electors; and probably only seven or eight provincial electors. The little information that exists about Brazilian elections in this period indicates that most parishes recognized more than half the active male population as citizens; the electoral rolls for 1872 show 1.1 million men, or 44.1 percent of this population, registered. The 1830 constitution of Ecuador also established that all heads of household were citizens with the right to vote, but that to be eligible for office one had to prove ownership of property worth at least three hundred pesos or an income from a profession, trade, or job, besides knowing how to read and write. Although there are no statistics about the total number of voters at the time, we know that the number of citizens eligible for office in all of Ecuador in 1848 was 192, or one for every 4,000 inhabitants, out of a total population of 768,000. Eight years later, in 1856, the number of electors was 806, out of an estimated population of 1.1 million, or one elector per 1,364 inhabitants. An example of how in this period Latin American politics was based on citizens who, independent of income, color, or education, had a role in local life and performed services to the community was the adoption of indirect electoral systems with lowered income qualifications, in contrast to requirements in many parts of continental Europe. Precisely because the number of citizens was so high, the distinction between those who could or could not run for office, and the several degrees within the former group, were meant to ensure that local demands would not disrupt the social order. Latin American elections therefore were a mechanism that allowed the many organized interest groups to come together to choose candidates for the various government levels, including, in some countries, the election of judges. The T h e N e w S tat e s A r e B o r n

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electoral mechanism linked the informal system based on the client-caudillo relationship to the institutional one, so that political practices gradually fell in line with the institutional norms, favoring the institutionalization of the new system. The image offered so far by the literature on the subject, of a gap in constitutional norms, institutions, and political practice, is by now obsolete. Although suffrage was more extensive in Latin America than in Europe, because of the indirect electoral system politics began to take on an elitist quality that, while not unhinging the old patronage system, helped change it. This mechanism to reduce the impact of extended suffrage depended on control of the electorate by municipal authorities (Mexico, Venezuela, and Brazil) or by a junta of the wealthier taxpayers (Chile, Peru, and perhaps Bolivia). Thus, while the government did not organize elections for its own benefit, elections were conditioned by strong players such as the municipal authorities and the upper-tier notables. In fact, from 1820 to 1840 in Buenos Aires (and in Mexico in the same period) the factions that controlled the electoral seats won the elections, thanks to the support of the municipal authorities. It is not true, however, that all elected officials supported the governor or the president, because in all countries a percentage of seats was set aside for the minority parties, thus ensuring amity and furthering the representation of moderates and radicals in the provincial assemblies and in congress. Precisely because power was spread out broadly among the notable groups, the executive branch did not have a clear supremacy over congress, just as in many confederations the governors did not enjoy absolute control over the assemblies. In the most stable Latin American country at the time, the Brazilian Empire, either the emperor or the regent could force the prime minister to step down or could influence the elections through his prefects, but he was always required to guarantee to the minority party a sufficiently large representation to offset the autonomy of the prime minister’s party visà-vis the emperor. Only in Chile and in the Río de la Plata provinces did the president and the governors control both houses (in the Chilean congress) and the provincial assemblies (in Argentina), provided, however, that they left a sufficient number of seats to the opposition. Thus in most countries the presidency was not hegemonic, and the parliament considered itself more important than the executive branch; it is not coincidental that parliaments or superparliaments of grand regional electors elected the presidents. The result, in most countries except Brazil and Chile, was that the executive branch did not have an impartial role such that would guarantee that all factions of notables would be represented. 132

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The electoral system gradually gave rise to a political class that, although it consisted mostly of old Creole families, kept its distance from peninsular politics in favor of an international political culture. The best documented example is, once more, Brazil, where education, in addition to a profession, became a unifying element of the new political class in which culture, economic interests, and political aspirations coalesced. In fact, in Brazil from 1822 to 1853, a background in the judiciary or in civil service was more important than owning a business or a large estate for eligibility to be a minister, senator, or deputy. Thus the political elite was not synonymous with big business and latifundio ownership, instead comprising well-educated men who could serve the state as judges or in the army or as liberal professionals practicing law, medicine, or engineering. Not coincidentally, the number of deputies with law degrees rose from 8 percent to 31 percent from 1826 to 1867, and this explains how education could be a mechanism of political and social advancement for the lower classes. The Brazilian political class combined education, a family background, and past service to the empire. In fact, even from 1822 and 1840, only 13.5 percent of the ministers had none of these attributes, while almost all (86.5 percent) had held elective posts or appointments at the national or provincial level. Interestingly, rural landowners who lacked an education but were politically influential could aspire to become senators, that is, members of the weaker parliamentary branch. This combination of backgrounds allowed the rise of a new political elite without any real rupture with the colonial past, an evolution promoted by its members’ experience in the different branches of government and the administration. As for Spanish America, there too the close interaction of family tradition, education, and public service created a political class with many roles. In the group of 114 deputies and senators elected to the 1835–37 Mexican Constituent Congress, attorneys dominated (22.2 percent of deputies and 15.5 percent of senators), followed by civil servants (9.8 percent of deputies, 21.2 percent of senators), the military (15.8 and 12.2 percent, respectively), large landowners (9.8 percent of deputies; no senators), and businessmen (17.2 percent of deputies and 18.8 percent of senators). This renewal of the political class occurred even in an apparently unruly country such as Mexico, where secessionist tendencies materialized after it became clear that the form of state selected, a confederation, was so weak that the state could not exercise all the powers granted it by the 1824 constitution. In the first half of the nineteenth century, Mexico was battered by tensions T h e N e w S tat e s A r e B o r n

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between the secessionist forces that dominated the vast scarcely populated regions of the north and the south, and the centralizing forces that dominated the more heavily populated central area of Mexico. This tension was a problem in the formation of all the subcontinent countries and even the United States and Canada. Ten insurrections occurred in Brazil from 1831 to 1835 and seven from 1835 to 1848, driven by the contrasting regional interests of the northern states (Pernambuco, Recife, and Ceará in particular), the center—Minas Gerais and Rio de Janeiro—and the south, especially São Paulo and Rio Grande do Sul. In Chile the regional interests of La Serena and Concepción contrasted with those of the capital and surrounding area. The same was true of the coastal regions, Lima especially, and the Andean altiplano, as well as Colombia’s coastal areas and the hinterland. Unless the regional tensions are seen in light of the constitutional disputes and the issue of political representation, this turbulence might appear to signify the inability of these countries to adopt stable forms of government, giving rise to theories, popular among some nineteenth-century European observers, about the political ineptitude of the Latin American countries. But the apparent instability arose from the difficulty, not to be confused with ineptitude, of relating the regional diversities to the form of government that had been adopted, because implementing the constitutions required, among other things, reshaping political practices and linking local demands to the new, still weak, administrations. In Mexico the tension between the supporters of a confederation and those who favored a unitary republic heightened the strong regional differences. The result was a fragile executive branch: between 1825 and 1855, congress elected forty-eight presidents, and congress itself was highly unstable, with shifting power groups that as late as the 1840s were unsure about the form the republic should take. A crisis erupted whenever the president tried to exercise his constitutional duties, and congress claimed not only legislative power but also executive power. This attitude, not limited to Mexico, reveals an elite-based political culture that regarded the president as no more than a peer among peers. Of the 1,931 deputies elected to the Mexican congress between 1810 and 1857, more than half were elected for just one term; that was especially true of confederation-oriented congresses. Of the elected deputies, about 20 percent were notables representing regional interests who were also well regarded in other regions. Thus, while the presidency represented political instability, congress, with broader powers, was the more stable branch of government. This explains why in times of crisis the political class could appeal to the 134

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military to moderate factional infighting and reestablish order so that a new president could be elected. Thus the military’s moderating role in this period guaranteed governability in countries with a weak executive branch. Even Argentina—at the time still called Río de la Plata—is an example of the difficulties encountered in setting up an appropriate constitutional order. Beginning in 1819, the various provinces proclaimed their sovereignty and adopted constitutions, thwarting the 1826 and 1828 efforts to create a centralized entity, for the strongest province, Buenos Aires, was not interested, and the hinterland was radically opposed. The provinces did not reach an agreement until 1831, when they delegated the province of Buenos Aires (controlled for several decades by its governor and caudillo Juan Manuel de Rosas) to represent them and signed a vague commitment regulating interprovincial relations. The provinces were to all effects sovereign states with a tendency to centralize power in the provincial capital, delegating political and administrative tasks to the governors, precisely what the literature would refer to as caudillos. Thus, in its separation from the monarchic order, Latin America resembled other parts of the Western world seeking a constitutional order that would allow political actors to choose a liberal, representative form of government with balanced constitutional powers. The difference in Latin America was that the lack of an absolutist, centralized government during the colonial era unleashed strong secessionist forces that produced broad regional autonomies. In many Latin American countries these autonomous regions claimed sovereignty, while ineffective national governments struggled with limited executive powers and recurring conflicts between the executive and the legislative branches. This situation led to a search for mediating forces, identified in the Church and the army.

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The Euro-American World

Historians generally have presented the expansion of the international system from the 1850s to the outbreak of the First World War by tracing the various historical factors back to a primary fundamental one. Some studies give more weight to a specific aspect, such as the bourgeoisie, or the imperialist powers, European hegemony, or the crisis of the lesser powers. The flaw in this analysis is that it gives too little weight to the interactive processes at work between the Mediterranean and Atlantic European areas and between these and the rest of the world: the former are depicted as dynamic, the latter as passive or as dominated by the British, French, and German states. None of these analyses properly takes into account the optimism that percolated on both sides of the Atlantic, heralding the intention of Americans and Europeans to seek converging forms of coexistence, so that geography might no longer be an obstacle to the circulation of people, ideas, culture, goods, and technology. The growing similarity of different areas of the world is a defining trait of nineteenth-century civilization, which stopped being solely European and took on an international air, not just because the economic interests of two continents converged but because this new wave of Westernization was marked by the establishment of similar political, economic, social, and cultural institutions on both continents. The balance-of-power principle governed the new order, as a result of which wars took place over a smaller geographic area and tended to be brief. This 136

principle applied to all the sovereign European and non-European states and was reinforced by the growth of free trade and the expansion of multilateral relations, both facilitated by adoption of the gold standard. Other factors that furthered the interaction of nation and world included the general acceptance of constitutionalism and of the liberal order as principles recognized by all states, so as to balance citizens’ freedom against the power of government. The liberal order, which guaranteed freedom of assembly, opinion, and the press, encouraged a strong public opinion that became international in this period. It also strengthened property rights, which in turn stimulated the free circulation of people and goods, the formation of one market governed by a meeting of supply and demand, and the growth of consumption. Modern institutions in the Euro-American world made the great discontinuity with the vanished Ibero-American world more striking; their distinctive feature was precisely the convergence of the national and international dimensions, made possible by new technologies such as the mail, telegraph, and telephone, which improved communication, and the easier and faster movement of people and goods by railroad, large sailing ships, and steamships. An easy way to visualize the transformations covered in this chapter is to keep in mind the new global dimension that resulted from reduced travel time, which also helped accelerate the propagation of ideas and products and promoted cooperation. F rom Eu rope a n to I n t e r nat iona l Concert

One of the more significant phenomena of the second half of the nineteenth century was that all the Euro-American countries were much more active on the international scene than they had ever been. The prerequisite for this greater dynamism was the renewed balance-of-power principle: unlike the situation before the American, French, and Latin-American revolutions, the idea of sovereignty now included the meaning of nation and was no longer just an attribute of monarchies. In this period, inspired by Rousseau, the ideal of people’s sovereignty took hold, reinterpreted at the constitutional level by liberalism, allowing the new American republics, which until then had been recognized as de facto governments, to become sovereign states de jure. The traditions that for centuries had bound Latin America to Europe facilitated the American countries’ participation in the international system. The Congress of Vienna began a reexamination of the ideas basic to the notion of the Concert of Europe, which was in effect at the time of the F r o m E u r o p e a n t o I n t e r n at i o n a l C o n c e rt

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eighteenth-century revolutions. The Concert of Europe was an informal agreement among the European monarchs, who pledged to balance their power and maintain peace on the Continent and in their overseas colonies. The new concept of national sovereignty incorporated the United States and the Latin American republics in this downsized power club, thus creating an international order open to all states, independent of their form of government. The result was an evolving international order based on consent and cooperation. The new order took shape at the time of the Crimean War and the Congress of Paris (1856), which restored peace in Italy and the Near East but did not prevent the creation of the Kingdom of Italy with Rome as its capital (1870) or of the German Empire (1871); the two new states would mark the beginning of the decline of the Russian and Austrian empires and the definitive victory of the nation-states. Thus the Concert of Europe, redefined by the Congress of Vienna, became intercontinental, regulating itself on the new principle that no sovereign state could be excluded, so long as each state recognized that its importance on the international scene depended on its economic and military power, geographic location, and ability to form coalitions and alliances with other sovereign states in times of crisis. The new order was thus open ended because the number of great powers was neither predetermined nor limited to Europe. The new order was at work when Germany, toward the end of the nineteenth century, began to question Britain’s hegemony; when Japan became a power in the Far East in the early twentieth century; and in the new muscular role that the United States assumed starting in the late nineteenth century. The transition from a European concert to an international one gave birth to an international system of states that took into account their unequal weight and affirmed the idea that, no matter how small a state’s power, it was sufficient to guarantee it a role in the balance of power. The new system was no longer fixed, unyielding, but offered to all sovereign states the possibility of joining. Still, the new order was not strong enough to prevent nations such as the kingdom of Piedmont and Sardinia, Prussia, Mexico, Japan, or Chile to act like soccer sweepers to increase their power, even if this did not sit well with the other powers. Thus Piedmont and Prussia could become sovereign states; Mexico could defeat the French on the international scene and liquidate Maximilian’s empire; Brazil could become a republic and send into exile the House of Braganza, which was related to the great reigning European dynas-

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ties; and Chile could pursue a power policy in the South Pacific and stand up to European and North American pressure. This system was not a closed universe, since it did not rely simply on the economic, military, and political power of the large and medium-sized states but also on the actions of the smaller states, for they too could destabilize the balance. The small states were interested in joining because they also pursued the idea of national interest, that each state must guarantee its own existence and growth, now and in the future. The idea of national interest gave specificity to the concepts of sovereignty and independence, was submitted to public scrutiny by evoking geographic integrity and natural borders, and spread forcefully to both North and Latin American countries, most of which had indistinct national borders. The defense of the national interest was especially strong in the dissatisfied European nations, especially those that, like Italy, had acquired the status of nation-state late, but it was also strong overseas, where the national interest was at work in the multiplicity of conflicts and disputes about the definition of national borders. To defend their national interest, Latin American countries also established alliances or counted on the neutrality of large and mediumsized European powers. They understood that participation in the international system would facilitate the resolution of conflicts and preserve peace. The transition from the European concert to the international one widened Europe’s participation in non-European areas. To deal with growing competition from the smaller states, the major European countries improved their military and naval power by increasing their military budgets and underwriting the growth of shipyards, weapons factories, and related industries. The broadening of the international community and the rapid growth of resources to be used for both diplomacy and the military brought about a shift in the balance of power. At the beginning of the twentieth century, a greater flexibility in the international order favored those countries willing to devote a larger part of their revenues to their international standing. As a matter of fact, new sovereign states such as the United States and Italy, and especially Germany, came into their own as powers by increasing their army and navy budgets, supporting foreign trade, and intensifying their diplomatic and cultural presence abroad. In this period an international concert took shape in which some old powers such as Great Britain, France, Russia, and Austria, and recent ones such as Germany, the United States, Italy, and Japan, became the leading countries. As a British jurist wrote at the time, this more flexible international order would encourage the idea of an interna-

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tional supreme court of appeals, which the creation of the League of Nations would try to implement. Nationalist but also pacifist and socialist tracts in countries dissatisfied with their ranking in the international order criticized the system that was taking shape; they argued that it favored the European plutocracies at the top of the system, without their hegemony guaranteeing peace. On the contrary, the ruthless competition among them, especially outside Europe, would lead the world to war. From the end of the nineteenth century to the 1930s, all countries in Europe and the Americas developed an interest in measuring their power quantitatively. The simple indicators used in the late 1800s—such as territorial size, population, education level, number of industrial, banking, and commercial enterprises, and foreign trade—began to be supplemented by economic variables such as production and employment. These data yielded the first estimates of national wealth and its translation in terms of army and navy power, measurable in terms of armed men, battalions, cannon, battleships, corvettes, and submarines—which contributed indirectly to the birth of the air force. To understand the importance of a country’s industrial and technological strength in defining its military deterrent (seen as a synthesis of its power in the international scenario), it suffices to consider that the eight superpowers owned 68.4 percent of the world’s industrial production in 1880, 81.5 percent in 1913, and 74.8 percent in 1928. These countries led not only in military power but financially, as is evident in their ability to export capital to other countries and manage the shipping of goods. Competition among the superpowers also favored the rise of new powers. Examples are the role played by British capital in the birth of U.S. power, the French loans used to build up Russia’s industry and military, and the alliance Great Britain offered to Japan in order not to lose its foothold in the Far East. Another example is the opportunity the European superpowers extended to the nonindustrialized Latin American countries to professionalize and modernize their armies and build a modern navy and air force, using the greater financial resources gained from growth in production and exports. However, the superpowers used their military industry to secure orders from nonindustrialized countries interested in buying a deterrent to protect their sovereignty, pursue their national interest, and secure their borders. As a result the nonindustrialized countries developed a foreign policy whose broad lines mimicked those of the superpowers, reproducing the phenomenon that I have described for Atlantic Europe, that is, the constant growth of military expenditures. 140

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L at i n A m er ic a i n t h e I n t e r nat iona l Or de r

Between 1850 and 1870 the Latin American republics constituted almost half the world’s sovereign states, had succeeded in affirming their sovereignty, and had avoided recolonization by Spain or the intervention of Napoleon III. To defend their sovereignty they resorted to all available diplomatic, political, and strategic channels, maintaining good relations with all countries without forming alliances with any. The Latin American governments found it convenient to reformulate and adapt the new order to their needs and strengths, making it more flexible. Their presence helped end the exclusively Eurocentric order and break up the asymmetry between Europe and Latin America that still governed the commercial treaties signed in the 1820s and 1830s.

Establishment of Sovereignty The greater participation of the Latin American countries in the international system after the 1850s was motivated by their desire to ensure control of their territory and define their borders. To this end they resorted to the same tools used by the European states, that is, the acceptance and observance of international law, diplomacy, and economic modernization as a way of securing more revenue to upgrade their armies. Accepting the principle that a nation could and should be defined in geographic terms helped to strengthen and redirect national interest, focusing it primarily on defining the country’s borders. Similar to what was happening in Europe, contested areas would be the springboards for the power politics in which all the Latin American states would engage; territorial disputes would help establish regional and international alliances. All South American countries had border problems, and the contested areas were usually uninhabited regions or ancestral Indian homelands that the government wanted to fold into the nation it was building through a policy of political and administrative centralization. Thus the concept of national unity soon became associated with the ethnic and social groups that had assimilated the most Ibero-American, and, later, Euro-American, cultural forms. Many conflict-ridden areas were home to Indian villages, for example, the areas contested by Venezuela and Colombia; or Ecuador, Colombia, and Peru; or Bolivia and Paraguay; or Brazil and its neighbors. Border disputes also took place in regions with natural resources such as saltpeter, copper, tin, and, later, petroleum that were not or little exploited. The reasons for L at i n A m e r i c a i n t h e I n t e r n at i o n a l O r d e r

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these disputes were geopolitical, economic, and cultural, which favored their internationalization, such as the 1879–83 Peru-Bolivia Pacific War for the Arica, Iquique, and Antofagasta regions. Beginning at the end of the nineteenth century, as the economy was fast becoming a defining element of power, geopolitics and spheres of influence made their appearance. Business and banking interests that originated in New York, Boston, Washington, D.C., and Chicago promoted and enabled U.S. expansionism across the continent, eventually reaching into northern Mexico, Central America, and the Caribbean, which soon became part of the U.S. sphere (see map 3). To fight the threat of U.S. expansionism, the subcontinent turned to Europe, Germany in particular, for support. The result was that all Latin American countries adopted the “natural borders” doctrine, the idea that a nation’s space must contain all the elements necessary for survival, as a basis for the harmonious coexistence of its people. Defending the nation’s space became a priority of all governments; this led to new policies of political, military, cultural, and administrative occupation of the frontier. Power politics was expressed by mobilizing the newly professionalized armed forces, multiplying legations and upgrading them to embassies, and pursuing an international strategy aimed at balancing the economic and political presence of the superpowers on the subcontinent. The creation and consolidation of a national geopolitical space in support of a nation’s sovereignty required policies to colonize the frontier, both the areas disputed by neighboring countries and the outlying frontier, where there was little government presence. In Argentina the process of colonization was called “the conquest of the desert”; in Brazil it was the “march westward”; in Chile the “conquest of Araucanía.” Mexico resorted to the sale of state-owned land. Similar to what was happening in the westernmost United States, the subcontinent countries tried to make vast expanses of land productive by selling them through various policies to private people and to extend state control to these regions. Of necessity, colonization meant colonists, so the new countries sought to increase European emigration to their ports. Countries such as Argentina, Uruguay, and Brazil put in place policies that attracted millions of emigrants, mostly from Mediterranean Europe. Others, such as Chile, Peru, Colombia, and Mexico, were not as successful, probably because the cost of a steamboat ticket was much higher for Pacific or Caribbean ports than for the southern Atlantic ones. Natural frontiers, or those thought to be so, also required military defense. 142

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IMPERIAL RUSSIA

ALASKA

GREENLAND

CANADA

Seattle Portland

NEWFOUNDLAND

Spokane Montreal Minneapolis

San Francisco

Boston Kansas City St. Louis

Los Angeles

New York Washington

Chicago Richmond

Fort Worth BERMUDA

Guaymas New Orleans

Monterrey MEXICO

Tampico

Havana

Mexico City

CUBA

Guantánamo Central areas

HAITI

PUERTO RICO CARIBBEAN SEA

Secondary areas Sphere of influence

NICARAGUA

Afro–North America PANAMA

map 3. U.S. Sphere of Influence, ca. 1900

DOMINICAN REPUBLIC

Not coincidentally, the leading players in the occupation of Indian territories were the new national armies; trailing them were engineers and surveyors in geographic expeditions that mapped out the new territories, a prerequisite for planning railway and telegraph routes and for creating an inventory of state lands. Thus the power politics inaugurated to guarantee territorial integrity required not only a modern professional army but also an expanded public administration. Following the arms race of the Latin American countries is useful for seeing how power politics was played. For example, Peru’s purchase of two British battleships was followed by Chile’s purchase of two corvettes, also from Great Britain. The acquisition of new military materiel led to the outbreak of the Pacific War (1879–83) in which Chile seized the province of Antofagasta from Bolivia and Tarapacá and Arica from Peru, the last two rich in saltpeter and other noniron ore that would help move Chile from an agricultural to a mining economy. The arms race was augmented by military missions that the new states asked Great Britain, France, Germany, and Italy to send; this race became a multilateral phenomenon that affected all Latin American states, because the Pacific War changed the arms balance between Peru and Chile in favor of the latter, which prompted Argentina to try to surpass Chile by buying new battleships at the end of the 1800s. Brazil in turn now needed to catch up, so it sent protest notes but also hastened to purchase new weapons in Europe. The same happened in Central America, where the consolidation of the liberal order in Mexico spurred the country, after 1867, to engage in power politics against its neighbors, especially Guatemala and Honduras, and led to a rapprochement, starting in 1890, with Europe to counter U.S. designs. The modernization of armies and navies that had begun at the turn of the century continued between the two world wars. After the First World War ended, the Latin American countries began to feel threatened by the disorder left by the disappearance of the self-regulating nineteenth-century arrangements and the failure of the newly instituted League of Nations. Their answer to international disorder and to renewed European and U.S. aggressiveness was an extreme jingoism that heavily influenced Latin American policies: many subcontinent countries adopted sweeper positions, trying to secure the best possible conditions in the conflict between the United States and Germany. In the 1920s and 1930s new forms of Euro-American cooperation furthered the professionalization of the police, and the birth of the air force, which would link the more isolated regions to the capitals. The growth of military power and the delegation of civilian tasks to the 144

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armed forces made them an important player in defining foreign policy. Entrusting the army with domestic security, which was threatened by the antinational forces of capitalistic imperialism, fascism, and Soviet socialism, led to an intensification of diplomatic activity. Military missions in Europe as well as the United States multiplied, even as interest was growing in joining international organizations such as the League of Nations, the International Labor Organization, the International Postal Union, and the International Weights and Standards Office.

Power Politics The growing involvement in world affairs of the subcontinent countries began with their participation in international conferences, the first of which was the 1830–32 London Conference called to resolve the Franco-Belgian conflict. Unlike the Congress of Vienna (1815) or the Berlin Conference (1884–85), where heads of state or prime ministers met, these conferences were for ambassadors accredited in the country where the conference was held. The flourishing of international conferences at the turn of the century allowed the Latin American countries to become involved; in 1899 and 1907 they took part in the Hague peace conferences that created the International Court of Justice at the Hague. The Latin American countries participated and unconditionally supported international scientific congresses and international expositions, from the first, which was held in London in 1851, to the 1939 New York World’s Fair. This intense international activity illustrates the ability of these countries to move on the international scene and promote the modernity they had achieved by their economic, demographic, and cultural growth. In fact, it was important to modify the old image that still prevailed in Europe and North America, that these countries were “second-rate” republics, and to demand a greater role on the American and international stages. Starting with the Berlin Conference, where for the first time non-European issues, specifically, Africa, were discussed, the Latin American countries learned about the new European colonialism and began to insist on participating in the new diplomatic conferences. To counter threats of colonialism, they decided to meet in Washington, D.C., in 1889: Seventeen of the nineteen American states participated, the first instance of official inter-American cooperation. The participants agreed to create a nonpermanent arbitration court to solve territorial disputes or conflicts that might arise. Arbitration was also proposed at an international venue in 1897 as a way to resolve conflicts between the Old and the New World countries; it was adopted at the L at i n A m e r i c a i n t h e I n t e r n at i o n a l O r d e r

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1898 Hague Conference that created the International Court of Justice and saw the participation of ambassadors from Mexico, Japan, and Siam. Although Europe did not adopt arbitration, it became the preferred device of inter-American cooperation. In fact, the Pan-American conferences held in Mexico City (1901), Rio de Janeiro (1906), Buenos Aires (1910), Santiago de Chile (1923), and Havana (1928) mediated the resolution of border conflicts and saw the signing of trade and tariff agreements and treaties to build roads and railways and set up inter-American maritime lines. The inter-American conferences helped to soften Washington’s expansionist drives and opened the way to the first multilateral relations among Latin American governments. In 1900 Brazil, at the time a leading power, worked to create a cordial entente with Argentina and Chile so that the United States would not be the only country that could “hold European colonialism in check” (Burr 1965: 427). At all the Pan-American conferences, starting with the one held in Rio de Janeiro in 1906, the participants distanced themselves from President Theodore Roosevelt’s corollary to the Monroe Doctrine, which gave the United States a police role in the hemisphere and authorized its military intervention in the more chaotic subcontinent countries. Starting at the turn of the century, both Latin America and the United States tried to actively inject themselves in international affairs after abandoning their original postindependence attitude of noninvolvement in the Concert of Europe, which had been redesigned at the Congress of Vienna. Latin America and the United States abandoned isolationism and adopted the principle of nonintervention in a state’s domestic affairs and of good relations with all countries; this was especially true of the subcontinent’s approach. The new direction took shape slowly after the Crimean War and became firm at the 1884–85 Berlin Conference, which, in addition to partitioning Africa, approved the free international navigation of rivers, something that the Latin American countries had opposed. To contain the new colonialism that could turn them into protectorates, as had happened in other non-European parts of the world, the Latin American countries adopted strategies for projecting an image of power. To this end Mexico had to show that it could defend its sovereignty from European aggression (1861–67); to ward off Spanish aggression Latin American countries attempted to form an alliance at the 1864–65 Lima Conference. They used Pan-American conferences to show Europe that the subcontinent nations could unite to counter any attempts at interference. Other efforts were designed to neutralize interference from Britain, the leading trading and financial partner of the subcon146

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tinent, by strengthening the sovereignty of each country and guaranteeing property rights to all, including foreigners. This last strategy finally put to rest the recurring commercial and consular disputes between the Latin American and the European countries that had festered until the 1870s. One positive aspect of the increased collaboration between the Americas and Europe was the birth of a multilateral diplomacy that filled the gaps left by traditional bilateral diplomacy by relying on diplomatic conferences, arbitration mechanisms that could mediate conflicts, and a generalized system of guarantees to which all the member countries subscribed. These forms of diplomacy, which developed spontaneously in the nineteenth century, are considered the foundations of the League of Nations. They would find a more appropriate venue in the new international organization, thus creating, as Woodrow Wilson believed, a new open diplomacy that would reduce the secrecy that until then had marked nineteenth-century bilateral diplomacy. The failure of the League of Nations heightened the Latin American conflicts, which were fueled by nationalism and economic protectionism. The result was a weakening of the regional consultation process and a series of border clashes. The adoption of the balance-of-power principle became stronger between the two world wars: Mexicans, Brazilians, and Argentines believed, as did the Europeans, that a nation’s goals could be hampered by the excessive power of an adjacent or nearby state. In the new global context the Latin American countries argued that even if they were part of a unified international system, their relations with neighboring countries still had priority. On the other hand, relations with nonneighboring countries ought to be cordial but not strategic. Argentine foreign policy is an example of these priorities. It aimed to control potential conflicts with neighboring Chile and Brazil, maintained cordial relations with Bolivia and Peru, and tried to be neutral with Uruguay and not hostile with Paraguay. For its part Chile sought to check the revanchism of Peru and Bolivia by relying on the support of neighboring Brazil and Ecuador, the neutrality of Colombia, and Argentina’s noninterventionism, despite the Chile-Argentina border issues. The principle of the balance of power was also the cornerstone of Latin American countries’ relations with Europe and the United States between the two world wars. The appearance of the United States on the Latin American stage, at first in the Caribbean, and of Germany in the Atlantic and South Pacific; the financial and commercial presence of France; and the increasing commercial importance of Italy and Spain led to the progressive erosion of the British hegemony on the subcontinent, which I have not disL at i n A m e r i c a i n t h e I n t e r n at i o n a l O r d e r

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cussed. The competition of the other European countries with Great Britain allowed the subcontinent to devise containment strategies, which helped to strengthen one or the other of the European powers and wrest concessions from them, eager as they were to invest in and trade with the subcontinent, intensifying a competition that created rifts between the economic and political interests of the same country. The subcontinent gained important benefits from the presence of the leading powers. The establishment of German, French, and Italian banks in Brazil, Argentina, and Chile opened up credit facilities to businesses, and competition led to interest rate reductions. The U.S. presence in Mexico was a deterrent to British colonial designs, favoring as well the settlement of the northern regions and the expansion of production there. Also, competition among the European powers translated, starting with the 1929 economic crisis, into an improvement in the rates of exchange and in intercontinental postal, telegraph, telephone, and maritime communications. Unlike the situation before the First World War, in the postwar period Latin America gradually lost interest in internationalization and turned to more specific policies designed to curb the drive toward globalization. This new direction was prompted by the reduced economic presence of the European countries and the growing influence of the United States, which made direct investments and large loans to the various governments and later implemented a policy linking economic measures directly to political action. The most significant event in the history of the United States between 1865 and 1914 is undoubtedly its joining the international scene and its transition from debtor country to creditor country. This transformation led to a shift from geographic expansionism to the building of an informal empire characterized by its new presence on the subcontinent, in some small Caribbean and Central American states in particular, through military occupation, annexation, protectorates, and economic pressure. In this way the Monroe Doctrine, which was originally designed to keep European power politics out of the Americas, was adapted to permit the United States to intervene on the subcontinent. I have already mentioned that the doctrinal shift was directed by President Theodore Roosevelt after the 1898 Spanish-American War for the control of Cuba and Puerto Rico. His new interpretation of the Monroe Doctrine intensified potential conflicts because at least until the 1930s the United States continued to claim the right to intervene in Latin American affairs. The forms of control that the United States imposed in the Caribbean and in Central America were substantially the same as those used by the 148

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European powers in other parts of the world. The main innovation was that annexation and protectorate status were preceded or accompanied by the massive presence of American corporations engaged in tropical agriculture or mining. This informal type of imperialism was an enormous challenge to the Caribbean and Central American governments, which reacted with anti-American policies and in general by adopting measures to halt or break up the U.S. presence. Although the Americans were successful in installing protectorates in Nicaragua, Puerto Rico, and Cuba and in separating Panama from Colombia and intervening in Mexico, the truth is that the United States encountered massive resistance, not only from political parties and movements but also from the governments that encouraged and supported anti-American riots and protests. During the five-year U.S. occupation of Haiti (1914–19), 3,250 resisters were executed, and an armed opposition movement arose in Nicaragua under the liberal César Augusto Sandino, who forced the Americans to withdraw in January 1933. Washington’s determination to create a protectorate in Central America and the Caribbean failed during the Mexican Revolution because of the resistance of the masses and their revolutionary leaders, who swung into action as soon as U.S. Marines landed in the port of Veracruz in 1914. The U.S. presence spurred the various Mexican revolutionary groups to put up a united front, which accelerated the defeat of the reactionary forces led by General Victoriano Huerta, who had deposed the constitutional president, Francisco I. Madero, in 1913. It is also true that U.S. public opinion helped to curb the imperialist tendencies of the U.S. government in the 1920s. In 1922 U.S. troops were evacuated from Santo Domingo, and at the 1922–23 Central American Conference in Washington, D.C., the United States signed treaties that returned sovereignty to the Central American countries. In 1933 the new Democratic president, Franklin D. Roosevelt, inaugurated for the subcontinent the “good neighbor” policy, which was founded on the principle of noninterference in the domestic affairs of all American countries, something that the subcontinent had been fighting for since 1898. The new policy was reasserted at the 1933 Pan American Conference in Montevideo, where the United States and eighteen other states signed an agreement recognizing the equal status of each American state’s sovereignty. Washington also accepted the principles of the Calvo-Drago Doctrine, that the amount of foreign debt of a sovereign state did not justify armed foreign intervention or occupation of its territory. The end of the imbalance of power that had characterized U.S.–Latin American relations for more than three decades was facilitated by the reapL at i n A m e r i c a i n t h e I n t e r n at i o n a l O r d e r

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pearance on the subcontinent of Germans and Italians as a result of the heightened international unrest in the decade preceding the Second World War. Nazi Germany and Fascist Italy supported Latin American demands to regulate trade through offset accounting to prevent imbalances in trade and in the payments of subcontinent countries. This nationalism-tinged demand was one that all Latin American countries advanced. L at i n A m er ic a i n t h e I n t e r nat iona l Econom y

The worldwide transformations I have just outlined show that the unequal economic development of the sovereign states did not have a negative effect on their participation in the international system at this time. Second-tier countries, like those of Latin America or Mediterranean Europe, sought to improve their position in an international arena that was dominated by heavy competition in world markets. They did so by increasing public spending for defense to protect their sovereignty, intensifying diplomacy to spread an image of power, and investing in industrialization to augment trade and foreign financing. (On the other hand, it is also important to bear in mind that the more industrialized European countries were only somewhat interested in non-European markets, believing that the subcontinent was not strategically vital to their economic growth. From 1850 to 1929 two-thirds of European commerce circulated on the old continent, which essentially closed its borders to the entry of non-European goods.) In addition to a strengthened sovereignty, the Latin American countries’ positioning in the international system also benefited from their long Western cultural tradition, which enabled the ruling classes to understand the importance of liberalism, constitutionalism, and private property rights and the need to revamp their political and economic institutions, which were rooted in the colonial period. The growing participation of Latin American regions in the international economic system thus constituted not only an economic but also a political and cultural phenomenon. The interaction between economics and the political culture explains the relative celerity with which the political elites reformed property rights in the mid-nineteenth century. With reforms guaranteeing property rights; freed partnerships among industrialists, merchants, and consumers; and free trade, both foreign and domestic, the new institutions counteracted the governments’ traditional tendency to confiscate private wealth. Thus they created conditions favorable to collaboration between domestic and foreign economic actors in the areas of production, business, and finance. These new relations 150

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Low-technology mining High-technology mining (copper, iron, bauxite, coal, nickel, manganese, and tin) Oil wells Livestock and agriculture Tropical plantations Coffee-producing areas Intensive temperate-climate agriculture Saltpeter, 1830–1970

map 4. Transformation of the Latin American Space

were the key to Latin America’s economic performance and its new international status. Map 4 provides a geographic overview of the major economic changes: new high-technology mining areas, new plantations for both temperate and tropical crops, and intensive animal husbandry.

Participation in International Commerce It is possible to follow the new directions embraced by the subcontinent by comparing its evolution with that of the leading and second-tier countries of the Atlantic and the Mediterranean. The performance of the subcontinent was substantially in line with that of the other Western countries. Argentina, Mexico, Peru, and Venezuela experienced a per-capita income growth similar to that of the big and small European countries. Although extensive data are lacking for 1810–70, it is fair to say that in the period that followed, 1870– 1929, the Latin American countries doubled their gross domestic product and tripled their population and that their participation in international commerce grew fivefold. The engine propelling the growth was the adoption of the free trade principle that preceded even the proclamations of independence of the 1810s and 1820s. But only in the 1850s would the Latin American countries begin to lift their protectionist tariffs. The liberalization of trade in Argentina, Brazil, Chile, Colombia, and Mexico led to the quick abolition of all export duties, the reduction of import tariffs on raw materials and capital goods, and a reduction in duties on consumer goods. Generally speaking, after the Latin American countries signed new trade treaties in the 1870s and 1880s with European countries, the subcontinent removed nearly all significant barriers to the exchange of goods between Europe and Latin America. Latin American exports increased from 1870 to 1930 faster than the average world rate—their rate of growth was significantly higher than that of European exports and second only to that of North America, which had the highest export rate for the period. Still, the long-held idea that exports constituted a very large part of the GDP and of the growth of the Latin American economies must be revised somewhat. Rather, the data show that the ratio of exports to GDP was lower than that of Western Europe and just a bit higher than the world average. In fact, the great capacity for exports, long attributed to the Latin American regions as they were Westernizing their economies in the second half of the nineteenth century and the first third of the twentieth, no longer seems accurate in light of the most recent figures, since the per-capita GDP grew 1.5 percent a year, in the most intense 152

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period of export growth, 1870–1913, and this did not depend exclusively on exports. The traditional notion that the Latin American economies had very high exports appears to be essentially incorrect. In fact, given the size of the exports from the different Latin American countries, and a calculation of export growth at a rate that would guarantee real growth higher than the population’s, I estimate that exports grew at an annual rate of 4.5 to 12 percent, while real growth was only 3.9 percent per year. Only Argentina and Chile increased their exports enough to generate a positive effect on the rate of per-capita income growth. It is reasonable to divide the period of 1850 to 1913 into three subperiods. Thus from 1850 to 1870 nine countries (Argentina, Chile, Colombia, Costa Rica, Cuba, Ecuador, El Salvador, Peru, and Venezuela) increased exports to a rate of more than 4.5 percent a year. In the next period, 1870–90, only seven countries (Argentina, Costa Rica, Guatemala, Honduras, Mexico, Nicaragua, and Paraguay) increased exports more than 4.5 percent annually, a rate of export growth higher than what was needed to increase per-capita income. Finally, in the third period, from 1890 to 1912, only five countries (Argentina, Chile, Mexico, Peru, and Puerto Rico) saw their exports grow at rates higher than the minimum required to increase per-capita income. With the exception of Argentina and Chile, which maintained their export growth rate for more than half a century, the subcontinent economies succeeded for only a short period. Furthermore, at the time of maximum expansion of international trade, which also was spurred by multilateral exchanges and the new financial brokering that made the exchanges possible, only a small number of countries benefited from the expansion of international trade. Since the 1950s it has been argued that the inability to respond to the stimuli of international trade expansion was due essentially to a decline in the price of exported goods, but this argument is unfounded because recent studies have charted the prices of imports and exports in Latin America: they increased from 1850 to 1870, declined in 1870–90, and rose again in 1890–1912. Therefore the changes in prices did not significantly influence the performance of Latin American foreign trade and do not explain its reduced international participation. The smaller role attributed to foreign trade in the economic growth of Latin America does not invalidate an important fact that may have been a relative advantage for these countries: they were among the small number of sovereign states worldwide. In the second half of the nineteenth century, folL at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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lowing the U.S. example, they signed new trade treaties that fully recognized each republic and its sovereignty. Thus they avoided the risk of a new colonization, unlike what happened in Africa and Asia after the Berlin Conference. The defense of political sovereignty can perhaps partially explain the mediocre commercial performance of the new countries. Still, they reached two significant goals: diversification of foreign trade partners and of the goods exported and imported. In fact, starting from a redefinition of the relations of Latin American countries and Europe after the defeat of Maximilian’s empire in Mexico in 1867 and of Spain’s reconquest of Peru in 1866, Great Britain’s volume of trade with Chile, Colombia, Mexico, Peru, and Uruguay progressively declined; its trade with Brazil stagnated; and Britain saw only a modest increase in its trade with Argentina. Because the Latin American economies were seeking new markets, in 1913 the industrialized countries (chiefly, the United States and Great Britain) received 70.8 percent of Latin American exports. (Another factor in that relationship was the competition of Great Britain, France, Germany, and the United States and between these and emerging economies such as Italy’s and Spain’s.) Data for imports are similar: in 1913 the industrialized economies received 75.1 percent of Latin American imports, leaving the rest to inter-American trade and trade with European countries in the Mediterranean. Insufficient importance has been given to the change in the types of goods traded by the subcontinent. The goods exported and imported in the three periods were not the same. As time went on, more exported goods were the product of more modern technology. For example, as of the 1880s, silver, which had been exported since the sixteenth century, was no longer exported as metal coins produced through the amalgam process but as bullion, ingots produced with a potassium cyanide process that required the use of electricity. As to imported goods, in the mid-nineteenth century they were still mostly consumer goods, with textiles constituting three-fourths of the total and little iron or other industrial materials. However, starting in 1870 rapid growth occurred in the importation of materials needed to process semifinished export products such as iron, steel, machinery, and equipment, while the imports of textiles and consumer goods stabilized, then decreased. In 1860 these new materials represented about 10 percent of total British exports to Latin America, reaching 24 percent in 1913. Importation of raw materials also increased along with the growth in the importation of semifinished goods and capital assets. Before the First World War imports of British coal accounted for 11.8 percent of all Latin American imports from Great Britain. 154

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The transition from importing consumer goods to semifinished products and capital goods is well documented for 1905–13. Available data state that the export of British capital goods to Argentina, Brazil, Chile, and Peru did not exceed £300,000 in 1905; in 1912 the export of British capital goods was valued at £900,000. Total Brazilian imports of iron and steel from Great Britain, Germany, and the United States for the processing industry in 1910 exceeded £100,000. Engines, machinery, rails, and other railway materials imported by Chile rose from $2.4 million (£533,000) to $3.2 million (£711,000) from 1884 to 1894, whereas Argentina in 1913 imported capital goods from Great Britain, France, Belgium, the United States, and Germany worth £8 million, or about 15 percent of its total imports. (Currency values are for the period.) The changes in imports highlight the transformation of industry in Latin America and the importance of new rail transport, new urban services, and the rapid growth of postal, telegraph, and telephone communications. All helped to improve communication and reduce transaction costs. In addition to the traditional exports, such as coined silver, leather, diamonds, and casting copper, new products—frozen meat, corn, cotton, flax, sugar, coffee, and wirebar silver and copper—began to be exported after 1850. The image of the Latin American countries as exporters of just one type of product and as producers of raw materials is deceiving. As a result of the new international mobility, the subcontinent received capital goods and labor from abroad that converted many of its products into semifinished goods— goods that were partially processed on the subcontinent. Therefore the new countries expanded into new, more remunerative, sectors that had a greater potential for growth and a growing international demand. Industrial processing with new intensive methods shows how quickly the idea of free trade was absorbed by the Latin American industrialists, who skillfully navigated the competitive international market. Also, the growth of Latin American exports primarily occurred in sectors that required more fixed capital, the use of new technologies, and skilled labor. In fact, the growth occurred in semifinished mining materials, such as oil, copper, tin, and lead, which were exported for their final transformation into finished products to European and North American factories, whereas traditional products such as silver, gold, and nitrates decreased. Export of agricultural products—such as wheat, corn, linen, beef, and lamb—was more limited, because they required new preservation technologies and new forms of marketing and financing, but these sectors did expand with a growing international demand. Despite the obstacles, including the limited capacity to compete with L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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similar goods produced elsewhere, from their first entry on the international scene the Latin American economies could draw on the benefits of the second industrial revolution, which had begun in Europe and the United States and from which the Latin American countries had been excluded in the first half of the nineteenth century.

The Birth of a Financial Economy The subcontinent’s participation in international commerce was not just the result of a general acceleration of trade but also of the changes in the means of production encouraged by the new financial services. A financial economy could both facilitate commercial transactions and channel available capital on both sides of the Atlantic toward Latin America. This process, often demonized in the press of yesterday and of today, shows the growing interdependence of Latin America and Europe. The financial innovations and their effects on the subcontinent are easier to understand by looking at the transition that took place in international trade payments, which from bilateral gradually became trilateral and then multilateral. This last form required financial and credit instruments to facilitate payment, so promissory notes, checks, and money orders became popular, and this led to the birth and spread of credit institutions and commercial and business banks. It drove the Latin American countries to see the international gold standard as the mechanism for regulating payments. Their adoption of the gold standard for international exchange and financial transactions hastened the demise of a world that still in the 1850s ran on three types of currency: gold (first adopted by England); gold-silver (continental Europe), and silver, which was used in Latin America and Asia. At the same time all the economies began to use one of the three existing gold systems: pure, banking, or standard. Agreeing to use the gold standard unified, for the first time in history, the different payment systems in use since the sixteenth century, first on a regional, then national, level, channeling public and private finances to the financial center (at the time London), assisted by the great financial markets of Paris, Frankfurt, Berlin, Amsterdam, and New York and the secondary markets of Milan, Barcelona, and Buenos Aires. In the nineteenth century commercial payments were settled with promissory notes drawn on London for Great Britain, the leading commercial partner, or Paris or Berlin for notes issued by trading houses and financial firms headquartered in London, Paris, or Berlin and with branches or correspondents in Latin America. These bilateral or trilateral forms of payment 156

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slowed Latin America’s performance because, in addition to limiting the growth of foreign trade, they did not favor the rise of banks and financial services in general. The only innovation before 1850 was the development in Atlantic Europe, Great Britain especially, of mercantile-financial concerns that, unlike the old mercantile houses, took on the financial risk of import and export trade, developing a wide network of agents in America and other non-European regions. The participation of the Latin American economies in the multilateral system of payments was also hampered by the currency system, which used only one metal—silver—in the countries that produced it such as Mexico, Bolivia, Peru, and Chile, while countries such as Argentina, Brazil, and Venezuela had a domestic payment system based on the circulation of fiduciary instruments or paper money, and foreign payments based on a gold premium. Furthermore, Latin America also had regulatory handicaps such as forms of payment meant to protect local trading guilds: foreign entrepreneurs had only limited property rights; although not technically a crime, charging interest was highly frowned upon (the stigma on charging interest on loans would disappear only in 1850–70 with the new legal codes); and there was a ban on forming joint-stock companies or even limited-liability companies. European regulations restricting the expansion of British and European banks abroad reinforced the negative view of financial activity. Only in 1862 did Great Britain allow the establishment of banks authorized to operate in the colonies and, more generally, abroad. The presence of British banks in Latin America, such as the London and Brazilian Bank (1862) and the London and River Plate Bank (1863), was made possible by the British merchant banks that already were dong business on the subcontinent and were also among the major shareholders of the new banks. In 1914 at least fourteen merchant banks were operating directly or through the British banks in Latin America. The Rothschilds’ bank was primarily active in Brazil and Chile, while Barings Bank was active mainly in Argentina. Also doing business on the subcontinent were London-based merchant banks that were primarily German, such as the Schroeder Bank, or Belgian, such as the Louis Dreyfus Bank. The latter specialized in wheat trading worldwide and thus was active in Argentina and the United States. Others, such as the Gibbs Bank, were well placed in the leading Latin American markets as well as in the British West Indies and Australia. The merchant banks had a pioneering role in the process that led Latin America into the multilateral payment system. They were among the first to issue loans to Latin American governments on the London market and also L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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on the Paris and Berlin markets and opened the way for other European banks to issue loans. The merchant banks also issued the stock of railway companies, insured goods and payments, mediated between companies, underwrote financial transactions, sold foreign currency, and, more generally, provided all the services of this nature. The merchant banks managed a commercial acceptances portfolio that increased from about £50 million to as much as £90 million from 1870 to 1900, reaching the vast sum of £140 million by 1910. In this portfolio the non-European areas, including the British colonies, represented 25 percent of the total, or £35 million, and about 3.6 percent of this, or £5 million, was attributable to Latin America. The expansion of new financial services accelerated the subcontinent’s entry in the multilateral payment system, aided by the new fast and lowcost communications. As a matter of fact, Great Britain was in the forefront of the telegraph and the telephone revolution, and this made it the center of international finance, starting in the late nineteenth century. As a result banks and businesses with at least a representative office in London could do business worldwide. The new global communications network was also important to British maritime interests, for military as well as commercial reasons, for they could easily supply coal to steamboats worldwide because Royal Navy bases were scattered throughout the South Atlantic (Falklands/Malvinas), Caribbean (Jamaica, St. Lucia, and Bermudas), North Atlantic (Halifax), and the Pacific (Vancouver, B.C.) and also serviced merchant ships of all nationalities. The technological innovations and financial brokering led to even more business and commercial interaction. In Latin America these innovations linked farming and mining producers with British manufacturers and ultimately with consumers, expanding production on both sides of the Atlantic. The presence of banks and credit institutions headquartered in London and in Latin American countries with branches and offices in American and European countries also strengthened the link between producer and consumer. Financial brokering facilitated the payment of goods sold through bank advances and clearing or the issue of promissory notes and commercial drafts and created the conduit for European capital to reach Latin America. The power of the telegraph meant that notes were endorsed, commercial drafts issued, and payment orders given not only between a bank’s central office and its branches but also between different banks. Starting in 1880, goods could change ownership several times before being actually unloaded, something that in the 1860s could happen only at their final destination. The rapid pace of the transactions, facilitated by the adoption of the gold 158

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standard, accelerated the multilateral nature of trade and increased the competition, both in Europe and in the Americas. Undoubtedly, Great Britain had a pioneering role in the international financial revolution. Business relations between the British—and, more generally, Europe—and Latin America set the stage in the 1880s for creating banks with Latin American capital as well as French and German banks, and banks established for Italian, Spanish, and Portuguese immigrants. A good example of this cooperation was the Banque Française et Italienne pour l’Amérique du Sud, born in 1910 from the cooperative efforts of Banca Commerciale Italiana, which had had branches in Latin America since 1905, and the Banque de Paris et des Pays-Bas in Brazil. As had been the case with British entrepreneurs and British banks on the subcontinent, the Italian and French immigrants and entrepreneurs who lived in Latin America bought significant shares of stock in the new French-Italian bank. Stock ownership by British and Latin American citizens was also substantial in the founding of the London and Brazilian Bank, the London and River Plate Bank, and the London Bank of Mexico and South America (1864). The presence of European entrepreneurs and immigrants both increased transatlantic economic relations and contributed to the spread of new ideas about public policy and business and industrial strategies with a view to increasing productivity and profitability. This meeting of the minds contributed to the modernization of state budgets and the reform of the tax system, removing corporatist privileges and favoring investment. The goal of the new fiscal systems was to overcome the chronic budget deficits of the first half of the century that politicians and elites considered an obstacle to economic progress. The new liberal governments tried to redirect public expenditures toward education, improvement of railroads and communication, and new public structures, especially in urban areas, eliminating the myriad parasitic interests that had gotten fat on the old allocations. The restructuring of public expenditure brought about balanced budgets and harmonized revenues and expenses. Import tariffs were reduced and export duties abolished, so that starting in the 1870s–80s the rhetoric of free trade, and, more generally, industrialization, began to coincide with financial reality. Thus the stage was set for the introduction of government financing, whereby the governments would secure loans on the European money markets to modernize infrastructures and communications. The financial restructuring and the newfound ability of the Latin American countries to honor interest payments on their debt and the amortization of their loans led to a convergence of monetary systems with the leading L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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European countries; clearly, the subcontinent wanted to be accepted in one of the systems that used the gold standard. The guarantees that international finance and Latin American and European businessmen required for the free movement of goods, technology, capital, and labor were strengthened. New studies of the gold standard note that all the second-tier countries found its adoption difficult. The United States adopted the gold standard in 1870, and Italy and Spain alternated between gold currency and fiat money. Therefore it is not surprising that the Latin American countries also wavered. While Italy remained on the gold standard for eleven years, Spain did not; Argentina stayed on it for fifteen years, Brazil for ten, Mexico for seven, and Chile for just three years. Interestingly, during the circulation of fiat money all the second-tier economies put in place partial gold standard mechanisms, such as the payment of customs duties in gold and the setting up of gold reserves, especially reserve currency, to minimize exchange fluctuations. Argentina, Brazil, Chile, and Mexico assigned great importance to reaping the benefits of joining the international gold standard, which included reduced interest rates on the financing that governments and businesses received in London. After two decades on the gold standard, the United States, Australia, and Canada had aligned their domestic interest rates with those prevailing in London. The gap between the British and Argentine interest rates decreased rapidly once Argentina adopted the gold standard after a decade of lax fiscal policy. Similarly, although it adopted the standard later, in 1906, Brazil saw a speedy alignment of its interest rates with British ones. Chile participated in the gold standard for only three years, and its interest rates did not decrease. Mexico, a major producer of silver at the time, was strongly affected by the rapid demonetization of silver between 1875 and 1890 and for this reason found it convenient to adopt the gold standard. Mexico began to work toward it in 1903 and adopted the gold standard exchange in 1905, a system in which gold took on the role of a generic equivalent but without demonetizing silver, which still circulated as domestic currency. The participation of the Latin American countries in the monetary and financial gold system, then, meant a gradual reduction in the interest rates that these governments paid in London on their loans and made it possible to restructure at lower interest rates the loans these nations had secured in the 1880s and 1890s. The benefits largely disappeared at the end of the First World War, after the European countries had repaid the war loans they had received from the United States. Great Britain, France, Italy, and Belgium chose to repay the loans with the compensation for war damages they were to receive from 160

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Germany. This created a vicious circle that unsettled the gold standard and the multilateral payment system, making New York, not London, the leading international financial market. The translatio imperii of international finance happened just when the Latin American countries had accumulated sizable currency reserves because of their neutrality during the First World War. From 1914 to 1919 the economies of the subcontinent grew substantially because of the active trade balances and the new loan policy of President Woodrow Wilson for his Latin American neighbors, who received loans on the New York financial market totaling $1.8 billion between 1919 and 1929. (Currency values are for the period.) From the end of the First World War to the 1929 bank crisis, almost all subcontinent countries adopted the gold exchange standard, creating a central bank that regulated their monetary and financial system. The abundant state revenues, which increased after the countries instituted personal and corporate income taxes, made possible increased public expenditures that benefited both the middle class and workers in urban and mining areas. Generally speaking, the good economic and financial position of Latin America before the 1929 bank crisis can be seen in its increased production, better use of industrial facilities, and expanded foreign trade and financial services, especially domestically.

Economic Modernization The convergence of Europe and Latin America in matters financial and monetary supplied the funds needed to implement government policies to modernize the economy and adapt the supply of Latin American goods to the international demand. These policies were not much different from those adopted in Europe. Brazil, Chile, and Mexico decreased their military budgets starting in the 1880s, stabilized their overhead expenses, and increased their expenditures for massive public works such as railroads, telephone, telegraph, postal communications, and ports. They also increased their outlays for education and health. In Mexico public spending on new sectors of the economy grew more than 10 percent a year from 1867 to 1910, with the result that federal outlays to develop transportation and communication infrastructures reached 10 percent of GDP in 1905–10. Argentina, Brazil, Chile, and the others countries made similar investments, although they spent smaller percentages of their GDP. As a result one recurring feature of all these countries from 1850 to 1914 was massive public investment in industrial modernization through subsidies disbursed to private companies. L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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These investments mean that commercial expansion was not, as some argue, a short-lived, inconsequential factor in the production and economic growth of the subcontinent. At the end of the First World War, Latin American public spending changed course, paying more attention to improving education and social security, in response to the growing demands of the new middle and working classes for social welfare. At the same time Latin American countries made extensive public investment in urban infrastructures such as telephone, public transportation, health, and low-income housing. The most important investments were in building an infrastructure of railroads and ports, as well as telegraph and telephone networks, thereby creating public services to show how industrial modernization was the result of the market meeting the state. Consider, for example, the effect of railway expansion on foreign trade. Although few data are available about the impact of the railroad’s reduced shipping costs on production and on domestic commerce, the estimates for Argentina show that had the shipping costs of the 1860s remained unchanged, total exports would have increased from £7 million to £26.6 million between 1860 and 1914. But the construction of railroads slashed shipping costs in half, thereby increasing exports from £7 million to £87.9 million from 1860 to 1914. Recent research has shown that the railroads did more than help expand foreign trade. In Mexico and Chile they also promoted a national market, ending the isolation of the local and regional markets and reducing price disparities in the different regions. As Latin American entrepreneurs, politicians, and intelligentsia claimed in the nineteenth century, the railroad was not just an economic tool but a civilizing one that contributed as much to the country’s material development as to its cultural growth, because it facilitated the circulation of ideas and of people and the birth of new feelings of nationhood. In only twenty years, from 1880 to 1900, the railroads became enormously important in Latin America. The rapid pace of construction led some to believe that the supply of railroad facilities was much greater than the real demand for freight and passenger transport. Available data show that the use coefficient of rail transportation increased rapidly from 1900 to 1930, such that railroads attracted U.S. capital. The expanded demand depended not only on the existence of a national railway network but also on the multiple links that began to develop between domestic and international markets and the greater mobility of people of all classes. The Argentine railway network had a hub-and-spoke pattern with links 162

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between all the provinces and Buenos Aires, which is also the country’s principal port. Areas with human settlements and industries multiplied tenfold after the arrival of the railroad. The railway network of the São Paulo region in Brazil, like that of Colombia and Venezuela, was also in a hub-and-spoke pattern, though the regional networks did not feed into a single national one. Still, the railroad linked the major regional centers with São Paulo, the state capital, and with the import-export port of Santos. The network had more lines in heavily populated areas, where Euro-American businesses producing for both the domestic and foreign markets were concentrated. In Mexico too the trains reached most of the territory; the Mexican network linked industrial areas with Veracruz, the leading port for trade with Europe, and with the railway junctions of Nuevo Laredo, El Paso, and Nogales, which connected to the United States, and with the port of Tampico, which was linked to the American ports of the North Atlantic. Complementing the revolution in land transportation were innovations in sea transport that, like the railways, required huge capital investments. Although the rapid reduction in freight charges on the North Atlantic between Europe and America from 1815 to 1850 and a more modest reduction from 1873 to 1908 are well known, less known is that this reduction initially resulted from the greater efficiency of sailing ships, not from the new steamboats. Steamboats did not become important for freight shipping until 1890; from 1900 to 1930 worldwide freight tonnage shipped by steamboat (41.7 million tons in 1913) was ten times higher than the freight tonnage shipped on sailing ships (4.2 million tons in 1913). The reduction in the maritime freight charges for shipping to and from Europe and Latin America began even before 1860 because of the greater supply of sailing ships and increased competition among the European merchant marines. The introduction of the steamship further increased competition from the sailing ships, whose freight charges continued to decline between 1875 and 1890. As a result shipping Latin American farming and mining products became less expensive. On the other hand, steamboat freight charges remained the same, so European shippers had little incentive to export European consumer goods to the subcontinent. The difference in the prices charged by the sailing ships and the steamboats illustrates the obstacles to transforming Latin American raw materials into semifinished goods, because reduced freight charges made exporting raw materials more cost effective. The sailing ship freight charge for Chilean nitrate decreased from £5.5 to £0.064 per ton between 1854 and 1907, while the steamboat freight charge for shipping wool and cotton textiles from L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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Great Britain dropped less dramatically—from £3.75 to £2.39 per ton from 1854 to 1906. The transportation revolution accelerated communication between people, businesses, and governments. The time distance between America and Europe shortened dramatically, not just because transportation, aided by the new means of communication, became faster but also because it became regular and reliable. The expectation that people and goods could arrive at a port and sail on specific dates reduced uncertainty and irregularity in both commerce and financial transactions, promoting multilateral exchanges, better financial links with Europe and North America, and, more generally, the modernization of the subcontinent’s economy. London, the leading financial market in Europe, listed government securities in excess of £5.5 billion; foreign governments had issued just over half these bonds. The same source reports that more than half the foreign securities were from Atlantic European governments such as Germany, France, Holland, Belgium, Switzerland, and Scandinavia, while nonindustrialized Eastern and Mediterranean Europe issued the rest. For example, the bonds issued by the Italian government totaled £323 million, an amount similar to that for the Americas, the United States included. The subcontinent’s participation in international commerce and in the international capital market was relatively modest. Credits received totaled £354 million, just 6.3 percent of the total amount lent to foreign governments. The same sources note that of the £3.7 billion loaned to sovereign states, only £2 billion was underwritten in London, while the difference, £1.7 billion, was collected in other financial capitals such as Paris, Frankfurt, Amsterdam, Berlin, Zurich, or New York. If this ratio also had been applicable to the British loans made to Latin American countries, we could conclude that only half belonged to British bankers, businessmen, and private investors, while the other half would have been in the hands of Latin American, French, German, Dutch, and Swiss investors. The influx of European and American capital meant that London had become the heart of international business, owing partly to the great amount of British capital available but even more to its financial and business knowhow. British finance captured available capital from all over the world, issued loans to governments, and sold to an international public the stocks and bonds of railroad, financial, commercial, mining, and agricultural companies operating outside Great Britain. The entry into the London capital market of Latin Americans and foreigners living on the subcontinent was quick. For example, when the Mercantile 164

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Bank of the River Plate was founded in 1872, about one-fourth of the stock, valued at £35,418, was held by six Argentine or Anglo-Argentine shareholders living in Buenos Aires. The financial connection between European and Latin American markets made possible the quick spread of London’s financial know-how to Latin America, so that in the early 1900s the leading subcontinent countries had commercial exchanges; from 1895 to 1920 the stock capital of corporations listed on Santiago de Chile’s stock exchange grew slowly, from 821 million to 1.2 billion gold pesos, to reach a veritable boom from 1920 to 1929, before the crash, of two billion gold pesos. The Buenos Aires stock exchange grew rapidly after 1906 as well: its capitalization was estimated at $350 million to $400 million in 1929, or 10 percent of the Argentine GDP. (Currency values are for the period.) A well-researched study of the Brazilian textile industry shows that from 1900 to 1925 textile companies collected 59.4 percent of their capital by selling stocks and bonds on the market and the remaining 40.6 percent from the reinvestment of profits. The financial interaction between Europe and America and the spread of financial services on the subcontinent depended, as I have already remarked, on the subcontinent’s rapid acceptance of the free movement of the means of production and therefore of the free circulation of capital. The increase in British investments first (from £80.9 million to £1.1 billion from 1865 to 1913) and American later (from $328.3 million to $1.1 billion from 1914 to 1929) cannot be adequately understood without taking into account the financial cooperation of Europeans, Americans, and Latin Americans, facilitated by the free movement of the means of production as well as the new financial mechanisms put into place by the multilateral payment system and the gold standard. The new interactive process recognized three leading players: the Latin American governments, international finance, and Latin American finance. A convergence of the interests of the Latin American governments and international finance triggered this process. The Latin American governments wanted to benefit from an expansion in the international demand for raw materials; the international financiers wanted to maximize their earnings from both trade and financial services. Thus it becomes clear why loans to governments represented the lion’s share of British investment (76.4 percent in 1865 and 44.7 percent in 1929). The promotional efforts of the Latin American governments and international financiers initiated a process that led to improved transportation and communication and the birth of a financial economy on the subcontinent. The effects of this double movement—speeding up the movement of goods L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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and translating private savings into wealth—may be observed in its culminating moment in 1913, when most British investments were in infrastructure and in financial and commercial services. The Westernization process developed rapidly from a two-party transaction—Latin American governments and international financiers—to a three-party transaction that included Latin American financiers and entrepreneurs. The importance of including the Latin American players is that they supported, and, even more important, helped spread, the process with their own capital, skills, and contacts with the local political class. The combined efforts of Latin American governments, Latin American financiers, and international financiers resumed after the First World War, even with changes in the financial markets and the difficulty of maintaining the gold standard. One key element was the upgrading of communications, financial services, and technologies developed both before and after the war. The Latin American players actively contributed to this effort because the innovations directly affected their economic interests. This in turn led to the development of more and better public services for the middle and working classes. Furthermore, U.S. policies inaugurated by presidents Woodrow Wilson and Franklin D. Roosevelt fueled a new cycle of prosperity, and many Latin American governments supported them and applied them in their own countries. The United States encouraged this modernization process with government loans. From 1914 to 1929 loans grew exponentially, from $365.6 million to $1.7 billion, or almost one-third of total U.S. investment in the subcontinent. The new cycle of modernization gave U.S. companies a much greater presence in tropical farming, mining, oil, and the processing industries, but unlike the first wave of modernization, which had by and large been a Euro– Latin American affair, the second one was so rapid and intense that it gave rise to nationalist reactions on the subcontinent. Investments, especially from abroad, give a distorted picture of the economy’s dynamism. The importance of foreign investment to economic performance has been overestimated because the ratio of total investment to GDP shrank gradually between 1900 and 1913, from 92 to 85 percent, then dropped right after the First World War, from 85 to 65 percent. The same trend occurred in the ratio of direct foreign investment to GDP. Even if we take population growth into account, neither the ratio of total investment nor that of direct foreign investment to total population increased. The only information that survives about the percentage of foreign capital in Latin America is from 1919, when it was just one-fourth of total capital. 166

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From 1900 to 1930 the ratio of foreign capital to total capital in Argentina did not decrease (it represented 32 percent of total capital in 1900, 48 percent in 1913, and 32 percent in 1930); the same was true for Mexico (foreign capital represented 49 percent of total capital in 1910, 47 percent in 1930). The percentages are high. In comparison, foreign investment in Canada, for example, kept shrinking, from 36 to 15 percent from 1900 to 1930; in India, the jewel of the British Empire, foreign capital was merely 9 percent of total capital in 1913, the same in 1929. Only in South Africa did foreign capital dominate: in 1913 it was 66 percent of total capital. Towa r d a N e w Soci et y

The changes that began in the mid-nineteenth century were not simply of an economic nature, that is, the result of increased international trade or the birth of national markets, or a financial economy. Claiming this would attribute to the economy a power that greatly transcends the multiple options available to social actors; economic needs do not necessarily automatically prevail over cultural or social needs. It is fair to say that during the second half of the nineteenth century and the first decades of the twentieth, the need to overcome one of the more significant challenges of the subcontinent, the low population density, became pressing. The problem was deeply felt and discussed in the European and Latin American press, where the lack of population was seen as a major handicap for the subcontinent, whereas high population density was regarded as a social threat in all the European countries, which therefore promoted emigration to the New World. Both North and South America believed that immigration would hasten economic transformation along with social and cultural change, which they felt was needed. The Argentine Juan Bautista Alberdi stated that “to govern is to populate,” thus summarizing the meaning of settling a region. Another illustrious Argentine, Domingo F. Sarmiento, believed that “once the industrious immigrants from Europe have converged en masse toward Río de la Plata, in ten years the river banks will be filled with cities and our Republic shall double its population with active, honest, hard-working citizens.” These ideas promoting population increase were not just empty rhetoric: the Latin American and European ruling classes were aware that a new international system was being born, based on the exchange of resources that were in excess in some parts of the world but lacking in others. This system T o wa r d a N e w S o c i e t y

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could now be implemented, not just imagined, thanks to the development of transportation and communication that, as I have shown, accelerated after the 1830s.

Migrations and Social Behavior The image of masses of European emigrants moving toward the Americas has hidden a parallel phenomenon in the Americas: the migrations within each country and the generally high geographic mobility of the population, a phenomenon that even today differentiates the Americas from Europe. Historians have taken a keener interest in massive international migrations. Map 5 shows these migrations. The emigration of people not driven from their country for political, racial or religious reasons, that is, voluntary emigration, was a worldwide phenomenon that originated in Europe and Asia and led people to the New World and, marginally, to Africa. Still, only half the European emigrants who moved to the Americas, about four million people, settled there permanently, while almost all the emigrants from Asia, another four million people, did so. The European migration flows toward Latin America had essentially two destinations: Brazil and the Río de la Plata region, that is, Argentina and Uruguay, while Chinese, Japanese, and Indians settled primarily in the Caribbean and the Guyanas. In other words, while European and Asian immigrants made an important contribution in terms of labor, society, and culture in all the regions facing the Atlantic and the Caribbean, in the other regions their contribution was mostly cultural and social. The work and presence of European immigrants in Mexico, Venezuela, Colombia, Peru, and Chile, although not in such large numbers, helped to intensify the processes of change that Latin America sought. Map 5 illustrates the movement of Europeans to the Americas from 1815 to 1914. The only two parts of Latin America to which European immigration increased after 1870 were Argentina and southern Brazil, which, like the United States, Canada, and Australia, became almost European appendages. The joke that man comes from monkeys but Argentines come from ships says a lot about the impact of immigration on Río de la Plata. European immigration began to have an impact in Argentina and Brazil when the waves of immigrants started arriving from Mediterranean countries such as Italy, Spain, and Portugal; Mediterranean immigration intensified after 1890, when immigration from northern Atlantic Europe began to subside. Contrary to popular belief, Italian immigrants did not prefer Latin America. 168

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S. d the U. ru, an zil, Pe a r B To

From Ja pan To Canada, Cub a

, Guyana , Peru, Trinidad, and the U.S.

From China

NUMBER OF MIGRANTS

Fewer than 2 million More than 2 million

map 5. International Migrations, 1815–1914

From Grea t Brita in

The choice of where to emigrate was not dictated by religion or linguistic considerations but by other imperatives. Italians, from northern Italy especially, had more migration experience than the Spanish and Portuguese and therefore were more knowledgeable about the potential to make good in the new countries. In fact, emigration to Brazil at the end of the nineteenth century began a rapid decline when the United States became the Italian immigrant’s destination of choice. The marked preference of Spaniards and Portuguese for Latin America, such that practically all Portuguese emigrants were directed there, did not depend so much on the language affinity or the colonial past as on the reduced interest of the Italians in the subcontinent, which left the Spaniards and Portuguese to fill the demand for labor. Italian emigration to Brazil decreased from 66.6 percent of total immigrants in 1887–1903 to 20.5 percent in 1904–14, while peninsular emigration increased from 33.4 to 75 percent of all immigrants in the same period. In Argentina Italian immigrants doubled, from 490,000 to 942,000, while Spanish immigrants quadrupled, from 199,000 in 1895 to 841,000 in 1914. Like the earlier British and German emigrations, emigration from the Mediterranean was triggered by demographic changes; the decreased mortality rate and the stabilization of the birthrate accelerated population growth in the Mediterranean at a time when early industrialization was having a negative impact on real salaries, further depressing the standard of living of the peasants. Understandably, then, a sizable percentage of people from Mediterranean countries was looking for a better life and the possibility of social advancement in the New World. In recent years some students of migration have argued that people who were skilled at more than one trade, like peasants from Mediterranean countries, were more likely to emigrate, as were people who had assets sufficient to pay for the transatlantic crossing or guarantee its payment. The idea has also been put forth that the choice of the country of destination depended on the difference between what the emigrant was paid in the country of origin and salaries in the Americas. Thus in 1870 Italian, Spanish, and Portuguese salaries were just 22 percent, 30 percent, and 27 percent, respectively, of U.S. salaries, and 41 percent, 57 percent, and 51 percent of salaries paid in Argentina. In 1913 the salary difference was still high, as Italian, Spanish, and Portuguese salaries were, respectively, 33 percent, 30 percent, and 23 percent of salaries paid in the United States and 60 percent, 54 percent, and 42 percent of salaries paid in Argentina. This difference could explain why Italians preferred to emigrate to the United States, whereas Spaniards and 170

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Portuguese continued to favor the South American countries. But economic reasons, even if important, do not sufficiently explain why a high percentage of Italians returned home, while the Spaniards and Portuguese did not. European emigration to Latin America caused internal migration to accelerate, just as it did in the United States. Throughout North and South America internal migrants and European and Asian immigrants pushed back the frontiers and settled virgin lands and made them productive. Mexican emigration and the United States had an important relationship: internal migrants left Mexico’s south and center-north to settle uninhabited areas of northern Mexico, then gradually moved farther north into the United States. Brazil is another example of the link between foreign and internal migration. From 1872 to 1920 the total population of Brazil grew from 10 million to 30.6 million; the regions with the most immigrants saw their population increase from 2.7 million to 12.6 million, while the other areas had slower population growth, from 7.3 million to 18 million. In other words, in the first areas population grew fourfold, in the second only twofold. Most likely, some natives of the northern and northeastern areas of Brazil were attracted by the opportunities of dynamic regions such as Minas Gerais and Rio de Janeiro that needed to supplement their labor supply with domestic migrants, even though they were also attracting European immigrants. Even before Latin America became the destination of Europeans and Asians, it was experiencing a demographic increase as well as the geographic mobility of its population. From 1850 to 1900 demographic growth accelerated from 30.5 million to 61.8 million and began to increase even more rapidly in 1900; by 1930 the total population of the subcontinent was 104 million. While the annual rate of growth from 1850 to 1900 was 1.4 percent, from 1900 to 1930 it was 1.7 percent. Demographic growth and mobility are good indicators of the vitality of the Latin American population. Driven by competition and a desire to emulate the European immigrants, in most regions Latin Americans reacted to challenges and improved their condition by seizing the new opportunities afforded by secularization and the growing individualism, which was replacing community-driven or corporatist behavior. The new human geography of the subcontinent greatly affected its social composition. As I noted in analyzing map 4, all the subcontinent was affected by new low-technology mining processes that did not require skilled labor; by new mining processes with advanced technology (such as iron, copper, tin, and oil extraction), which required skilled workers; and by new tropical and temperate-climate farming that required the settlement of underpopulated T o wa r d a N e w S o c i e t y

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regions. Modern animal breeding also increased, as did the number of temporary settlements in the rain forest to harvest precious resources. Certainly, the great industriousness of the Latin Americans also stemmed from their desire to exploit European know-how and culture. A cultural diffusion occurred that allowed the rapprochement and transformation of Ibero-American behavior into what we might call Euro-American behavior, resulting from the simultaneous presence of British, French, German, Italian, Spanish, and Portuguese immigrants.

Birth and Consolidation of Urban Networks The transformation of the cities of the subcontinent is a phenomenon that hints at the societal changes that had been taking place since the nineteenth century and had been attracting both Europeans and Latin Americans. Thus far I have used descriptions of Latin American cities by European travelers who wrote about the lure of exotic societies but reported nothing about the new schools, mail, telephone and telegraph service, potable water, and drainage and sewer systems that were built in the major cities and ports. These improvements raised the quality of life immeasurably, reducing the mortality rate from endemic diseases such as malaria, smallpox, diphtheria, yellow fever, and cholera. They made cities much more livable, and the local authorities placed great emphasis on public health and new public gardens, parks, and theaters, which offered solace and leisure-time activities. The new discipline of urban planning visibly changed the cities’ configurations, breaking up the original Iberian plan, which followed the four-quarters layout derived from the Roman castrum. Boulevards, parks, and squares were built and decorated with monuments to national heroes. The government sought to secularize the city, differentiating it from the Ibero-American city, where the religious and the secular dimensions were intertwined. The greatest change that made Latin American cities more like European and North American cities was their integration, made possible by public transportation and communication, into an urban network of complex, multifunctional cities, secondary cities, and single-function towns, which were either industrial or residential. From 1870 to 1930 cities and towns multiplied, creating, especially around 1900, a network that became a powerful mechanism for propagating new forms of socialization. As dynamic urban characteristics came to dominate the villages, they accelerated the breakdown of the old consociational and corporatist forms of aggregation. Already at the turn of the twentieth century, the “capital city” had been replaced by the network. Cities with more 172

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than ten thousand inhabitants and a politicocultural role, in addition to an economic one, multiplied and took their place in the new network. In fact, 10 percent of the population of Argentina, Brazil, Chile, and Mexico lived in urban centers with more than ten thousand residents, and by 1930 the same was true of Colombia, Ecuador, and Uruguay. The network of cities did not just consist of small towns and metropolises, because many small towns grew into medium-sized cities of more than 100,000 people and multiple functions. The differentiation of functions and roles and the evolution of social behavior followed Western models. Also, starting in the twentieth century the old capitals were no longer the only cities that propagated urban and social transformation. The capitals mushroomed into metropolises precisely because the network of cities expanded the functions it had had since the 1850s, involving small, medium, and large cities. So little is known about the impact of increased agricultural production that it is impossible to argue that urbanization was related, as it was in Europe, to increased farming productivity and, later, industrialization. One datum that makes me believe that farming productivity increased, favoring urban growth, is the strong presence of commercial farms that favored the monetization not just of crops but also of salaries and the appearance of farm leases. The change meant more freedom of movement for individuals and the beginning of the end of the old ties of personal dependency and the removal of community restrictions. The gradual breakdown of the old social order in the countryside may be traced by following one factor of change at the local level: the expansion of villages and the establishment of new municipalities. Brazil had 618 municipalities in 1871, 1,168 in 1910, and 1,300 in 1920. Of these, those having a town with at least five thousand residents quadrupled in number, from 202 to 795, from 1871 to 1920. In Mexico the number of small settlements also grew, from 4,902 in 1854 to 7,783 in 1910. The number of small towns also expanded in such countries as Bolivia, where even in 1910 native Indians constituted the majority of the population. An American diplomatic report of the time mentions that the Bolivian government left most of the administrative tasks in the Indian municipalities to Indian mayors and aldermen, who exercised considerable authority over their communities. In other words, the greater freedom enjoyed by the lower classes starting in the 1870s allowed individuals and families to move to hinterland villages and small towns, which became the end points of the networks of cities. Certainly, urbanization weakened the racial and ethnic solidarity of the nonwhite populations and favored T o wa r d a N e w S o c i e t y

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greater racial and ethnic interaction; this occurred much more rapidly in the large urban centers than in the villages and was the process that would form the basis of the new idea of nation on the subcontinent.

Differentiation and Pluralization of Individuals in Society During the second half of the nineteenth century, conditions were ripe for a demographic transition, as well as the appearance of the first networks of cities and the formalized relationship of village and city; at this time Latin American society shed once and for all the old corporatist social order that had restricted individual freedom of action, further Westernizing social behavior. Documenting the new Westernization requires some knowledge of the forms of socialization that began to appear in the 1850s and of the variants that became the norm in the different countries. But even if little research has been done on the subject, we know, if only fragmentarily, that an individual’s greater freedom of action is born from the ability to create new forms of association. Initially, voluntary forms of association were mostly religious, such as brotherhoods, and military, such as urban and rural corps and militia; these religious and military associations were replaced by secular ones, then by the Catholic associations that arose at the end of the nineteenth century. After the liberal revolutions of the 1850s and 1860s, the recognition of human rights and of citizenship rights encouraged freedom of the press and of assembly, and eliminated bureaucratic impediments. As a result voluntary forms of association expanded rapidly. In Lima, capital of Peru, forty-five associations of attorneys, teachers, and physicians were formed from 1846 to 1879; these in turn led to new social clubs, including patriotic, leisure, professional, and study clubs, creating types of social relations different from traditional family-based or corporatist forms. This phenomenon was not limited to the elites. From 1840 to 1880 all countries witnessed the transformation of the old corporatist militias into armed citizens’ organizations called civilian or national guards. Initially encouraged by the governments, these new urban organizations detached themselves from the regional and local governments and became autonomous, even electing their own officers. These armed citizens’ organizations became the meeting places of the new urban classes, professionals but also retail merchants, tradesmen, and laborers. In the Mexican mining centers of Pachuca and Real del Monte, miners also were members; similarly, small farm owners, tenant farmers, and settlers joined the new associations in Colombia and Brazil. 1 74

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In the countries with a large immigrant population Italian, Spanish, Portuguese, British, French, and German mutual aid societies sprang up. In other countries, such as Chile, people gathered in Masonic lodges that promoted the organization of companies of firefighters. Other types of voluntary associations were philharmonic orchestras, musical bands, patriotic clubs, popular education groups, and antipoverty organizations. This phenomenon broke the monopoly of the church over intermediate social organizations, promoted the freeing of individuals from corporatist or community ties but without forcing individualism, and encouraged the gradual differentiation of public and private that is a cornerstone of contemporary society; finally, it offered fertile soil for the renewal of political and institutional reforms. Especially significant were the new laws centering on the individual as social actor, the secularization of social behavior through the creation of a national civil registry, and the extension to women of all civil rights, which would lead to their demands for political rights. As I have noted, the new organizations were born from the process of individualization, which ultimately involved all parts of society. On the job it promoted the birth of new workers’ and miners’ organizations and even the first peasant organizations. In fact, retracing the progress of the workers’ and peasants’ movement makes it clear that the first organizations were mutual aid societies that initially organized workers on the job to help families cope with misfortune; they would later represent striking workers and materially support them. The new types of workers’ associations facilitated the transition from simple rebellion to organized participation of the working class to defend salaries and seek improved working conditions. Social diversification, individual freedom of action, secularization of social relations, distinction between private sphere and family sphere and between the private-family sphere and the public realm, and the new intermediate forms of organization all led to the most significant change, from a notablebased society to one simply based on class. Unlike the old Ibero-American societies, which were founded on such considerations as prestige, honor, and wealth, the Euro-American societies were now based on individual or family income, a standard that was reductive because it measured income and only indirectly the ability to save or to consume. However, this measure made it possible to universalize social actors and bypass their geographic and territorial specificity. It also led to greater awareness of the relationships between an individual’s actions and his material base of subsistence and reproduction. Changes in the social lexicon show the transformation to a society based T o wa r d a N e w S o c i e t y

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on economic classes: categories of vagrant, loafer, and day laborer steadily disappeared, and new words, such as worker, salary, and strike came into use. Factors such as work and income became important in people’s way of thinking and feeling, while the old standards of honor and prestige, which still had been preeminent at mid-century, became less important. The inescapable propagation and adoption of class criteria led to stronger links between cities and between city and country. Specifically, the peasant, tradesman, merchant, and bourgeois acquired a strong identity in this historical period. Although they already existed in the early 1800s, their status and social role one hundred years later differed markedly. I insist on this difference because I believe that the essential transformation into class-based societies, and their convergence into today’s Western forms, depended on changed collective behavior. People broke down the old hierarchical divisions typical of notable-ruled societies and moved beyond them; by doing so, they also helped sweep away ethnic and racial discrimination, giving birth to a national society. In the early twentieth century the Latin American societies consolidated into today’s multiethnic and multiracial societies organized by economic criteria—income and occupation. This was the culmination of a process that began in the second half of the nineteenth century, when work-based differentiations began to be used along with the specialization of labor. The latter was facilitated by the expansion of monetization and the introduction of plants and machinery, new technologies, and expanded education and culture, especially for the middle and lower classes.

Redefinition of Social Components In describing the social changes that Latin America underwent in the nineteenth century, I have identified the various engines of that change. Great importance has traditionally been given to the appearance of two new classes that did not exist before the mid-nineteenth century: the middle class and the workers. Of course, they are only the last phase in a process of social diversification that affected all strata. In fact, the two new classes forced the lower classes and the notables to change, for both new and traditional classes were affected by the same phenomena, the secularization of society and secular associationism. New social behavior became more visible starting in the 1890s, when the network of cities was already in place and the roles of white- and blue-collar workers, as well as the roles of the large, medium, and small landowners, had been redefined. Many latifundio owners began to be referred to, and to 176

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call themselves, entrepreneurs, since they also owned manufactories or were merchants or financiers and belonged to several industrial or professional associations. The process of diversification of interests that Westernized all social strata radically changed the lifestyle of the notables in ways inspired by the European upper bourgeoisie. Traces of these changes are still visible today in the imposing mansions in the capitals and large cities. At the same time, starting in the early twentieth century, local entrepreneurs began to compete with foreign businesses, as demonstrated by the increased number of local companies listed on the Latin American stock exchanges; in other words, even the elite, which was thought not to be receptive to change, showed great powers of adaptation. Historical interpretations based on the concepts of dualism and social polarization claim that social change happens vertically, that is, modernization begins with the upper bourgeoisie and travels down to the lower classes. But some examples suggest that that is not necessarily the case. One change in the lower classes was the end of their forced life on the plantations, in the mines, and on the latifundios, because they had fallen into debt and owed either free labor or money, and the beginning of voluntary migration to areas with better working and living conditions and compensation in hard currency. This phenomenon occurred in all the Peruvian, Bolivian, Mexican, and Guatemalan regions with large Indian populations, but it also occurred in parts of Chile, Brazil, and the Caribbean with mostly mixed-blood populations. The growing demand for labor finally broke up the debt system and made salaries payable in currency, a change that also was supported by the new liberal institutions. Workers’ determination to be free played a significant role in eliminating the debt system, which constituted virtual slavery. They ran away from mines and latifundios and challenged, individually and in groups, the presence in their villages of recruiting agents. A chronicle of the life of a Chiapas Indian, Juan Pérez Jolote, recounts how the transition from forced migration to free choice of residence was made possible by the shift from advance payments in kind to advance payments in cash, guaranteed by the village notables. Another factor that promoted the free movement of workers was the growing differentiation in the countryside between permanent and seasonal labor. While the number of permanent jobs did not grow, seasonal work increased enormously, forcing the latifundio owner to pay salaries in cash, instead of in kind, and later to increase them. As a result the traditional forms of subjection and patronage gradually weakened. In all regions where commercial farming or high-technology mining developed, the traditional relationship between T o wa r d a N e w S o c i e t y

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large estates and communally held land, and, more generally, between village and industry, changed, facilitating the free action of the lower classes. The new forms of production thus promoted labor freedom, which the workers demanded, but also brought about social conflict throughout the subcontinent, from Mexico to Argentina. The breakdown of the bonds of servitude and paternalism also helped change the old forms of rural and village resistance, giving rise to rebellions that the new liberal governments now could repress more effectively by calling on their newly professional armed forces. The transition from simple rebellion to new forms of organized labor was a reaction to the government’s more effective administrative and military control. Banditry and messianism, two early forms of resistance, had combined religious and social yearnings and had played an important role in the earliest organizing of marginalized rural classes. Among the messianic movements were Tomocich in the Mexican region of Chihuahua (1892) and the Canudos in Brazil’s Bahia (1897). The demands of the rural workers revolved around a number of issues, including working conditions and access to the land; however, these two factors were not necessarily the most important. Usually, the demand for an end to servitude and oral contracts triggered demands for improved working conditions and access to land. Toward the end of the nineteenth century and the beginning of the twentieth, the rural areas experienced growing social tensions that did not erupt in violence only because of the growing demand in the cities for unskilled labor in services, construction, and the production of consumer goods. During the Mexican Revolution (1913–19), Mexico City grew enormously, swelled by an influx of peasants. At the same time the first peasant organizations were demanding the distribution of lands, salaries paid in hard currency, and more schools. Unlike the new farmworkers’ organizations, about which scholars are beginning to have more information, the blue-collar workers’ movement spread rapidly, probably because it arose in cities. In the span of a generation, from the end of the nineteenth century to the outbreak of the First World War, the workers’ organizations rapidly became national, with international affiliations. They were successful because they resorted to the tactics used by European workers: class warfare and cooperation. Ideas of social Catholicism, socialism, anarchosyndicalism, and democratic liberalism quickly took hold, disseminated through the press and pamphlets and in after-work clubs in factories and mines. Ports, railroads, mail, and the telegraph were used for domestic and international communication; the oral transmission of ideas and programs was fundamental in reaching the masses. 178

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The evolution of the workers’ organizations shows once more how secularization transformed the religious brotherhoods into mutual aid societies, which in turn gave birth to associations that gave financial support to the workers and led to new forms of solidarity, such as unions, parties, and political movements. From 1900 to the 1930s all Latin American countries experienced industry-wide and general strikes, which helped change the way in which the masses came together in cities, mining regions, and villages. Social issues quickly became a powerful mechanism that changed social behavior. Significantly, one of the first victories secured by workers was the reduction of working hours and the official recognition of May 1 as Labor Day in the first years of the twentieth century. Role and class differentiation accelerated with the creation of new government entities and the technological changes in industry and in commercial and financial services, starting in the late 1800s. These changes helped to greatly expand the number of tradesmen, shopkeepers, white-collar workers, attorneys, physicians, engineers, teachers, and professors. The growing professional and middle class became clearly differentiated from the elites, whose lifestyle they had been mimicking. Members of the middle class and professionals acquired their own identity in the context of the nationalism preached by the liberal governments; they also found elements of ideological cohesion in secular associations and in criticizing a liberalism that tended to exclude them from political life. The political culture of the middle classes grew slowly and in opposition to the bourgeois elite, which they saw as an oligarchy that held on to the patronage system that blocked their ambitions; the middle class and professionals pressed their demands for social and political reforms that might help break the monopoly of the bourgeoisie. Social differentiation also affected the elites. Certainly, it was the first class to differentiate itself as it was the most receptive to Europeanization and the class that best understood the importance of the new economy and its strategic role linking European companies with domestic ones. The transformation of the notables into the bourgeoisie happened quickly in areas that were more directly affected by economic and government change; the bourgeoisie promoted all the institutional changes that guaranteed economic freedom and the protection of private property. One of the more significant aspects of the nascent bourgeoisie was that businesses were quickly losing the family character they still possessed in the 1870s and began to be transformed into joint-stock or limited-liability companies. The transformation of the notables into the bourgeoisie was the beginning of the consolidation of a class-based society on the subcontinent. T o wa r d a N e w S o c i e t y

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T h e L i be r a l -R e pu bl ic a n Pol i t ic a l Or de r

One significant aspect of the nineteenth-century Westernization of Latin America is the diminished influence of religion on society and the breakdown of hierarchical principles in society and politics. In this period individual behavior became freer and more autonomous than it had ever been, as people were stimulated by new needs and the cultural offerings coming from abroad, primarily from Europe. The ability to adapt both new and existing political forms to new local and national needs illustrates the capacity of individuals to choose by differentiating the public from the private sphere and individual from collective interests. In this way society began to differentiate itself from politics, giving rise to a political order that, unlike previous ones, broke with the logic of the ancien régime.

New Political Actors and Political Forms The demand shared by all classes in the nineteenth century—including the ruling class, which implemented it in modified form—was the expansion of education, for people believed that learning would aid an individual’s advancement and reduce pauperism, particularly among the peasants. Education (beyond basic literacy) was seen as a tool for the national integration of the various ethnic and racial groups. The importance attributed to education also shows that the idea of a better world was becoming secularized as people started to glimpse the possibility of reaching it in this life instead of the afterworld. As more people gained access to education, the use of Spanish, Portuguese, English, and French became more widespread on the subcontinent, starting in the eighteenth century. But it was only after the liberal revolutions of the nineteenth century that mass education became a state imperative as part of the new liberal order. Unfortunately, the many studies of both public and private education fail to consider the qualitative (rather than the merely quantitative) significance of the spread of education in the communities, and the role of the liberal state in supporting and financing public schools. These studies focus on census data, according to which no more than 10 to 15 percent of the adult population could be considered literate. However, the censuses did not take into account the basic education given in municipal and parochial elementary schools, or the fact that education indirectly promotes the sharing of information even in illiterate communities. After all, written culture evolves from changes in oral culture. In addition to helping overcome social conditions, education led to the 180

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political involvement of new classes that attacked the corporatist order and the elite-based political system. In many ways the political order that existed from independence to the 1850s recalled the European Restoration, and the opposition to elite rule had similarities to the opposition in the period just before the pre-1848 insurrections in Europe. The basic political demand of the European and Latin American middle and lower classes was to end indirect, income-based citizenship and implement direct suffrage—one head, one vote—in full recognition of the rights of man and of citizenship. Unlike the period immediately after independence, when the priority was to create a constitutional framework that could guarantee the interaction of the existing social strata with the nascent political class, the trend that began in the 1840s was to build a constitutional framework founded on the principle of equality before the law, independent of income, ethnicity, or race, that would gradually include all the adult male population in political life. The reform movement that triumphed from 1850 to 1870 did not simply replace the old late-colonial elite with a new, liberal-minded one. A new movement arose that enabled the different classes to interact to build a political order guaranteeing to all social actors freedom, the right to private property, and social peace. Arguments to the contrary notwithstanding, the participation of the masses was significant, one proof of the influence that secular associations had gained in the decades after independence. As a matter of fact, it is not possible to understand liberal reformism without taking into account the civilian and republican militias, which were constituted by soldiers of different classes who elected their officers directly; local political clubs; Masonic lodges to which both notables and regular citizens belonged; and Catholic circles. Many liberal politicians had a background in associationism, and many had advanced by fighting the French invasion of Mexico or the government armies of Colombia and Argentina or the antiliberal, church-supported generals of Peru and Ecuador. During these struggles diffusion of the concepts of nation and of republic strengthened liberal ideals. It is important to stress the convergence of these ideas that gave breadth to liberalism and reinforced the spirit of cooperation among the citizens of each country. The idea of a republic was seen as promoting class solidarity and propelling a more educated population toward the idea of nation. The connection of liberal, republican, and national ideas is the ideological weapon that destroyed the hierarchical principle and made possible the birth of independent states and the overcoming of the regional and local biases that had opposed centralization. The increasing relevance of public opinion that followed the diffusion of The Liberal-Republican Political Order

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newspapers and political journalism and the gradual disappearance of censorship reinforced these new political trends. Public opinion became pluralized, and ideological differences formed within liberalism as well as within other ideologies, contributing to the popularity of new democratic, socialist, anarchic, and Christian-socialist tendencies. After a hard-line opposition to laicism and liberalism, even the church came to accept the concept of a secular state. The strength of the reformist movement of the mid-nineteenth century came from the convergence of three forces: liberalism, republicanism, and nationalism, which, in addition to reinforcing each other, were enormously powerful because they were all pitted against the ancien régime privileges maintained by the church, army, big merchants, and, informally, the landowning and mine-owning classes. As a matter of fact, the prelates, military, and merchants had been able to safeguard their privileges, including peer justice handed down in special tribunals, while the land and mine owners had seen their power increase as a result of the patronage relations they maintained with workers and the middle classes. The anticorporatist struggle sought to expand the liberties of all social actors, eliminating or at least mitigating the influence of the local potentates and governing in accord with constitutional principles. For this reason the political actors placed great importance on citizenship and political representation. The different countries drew up new constitutions between 1850 and 1870. They contain three important innovations: the rights and duties of citizens, balance of constitutional powers, and form of government. Of the three, the rights of man and of citizen were central, with passionate debates at the constituent assemblies that sought to determine which institutions could more effectively guarantee these rights. In fact, there was an effort to ensure that the rights of citizens, and people in general, would not be restricted by despotic or dictatorial governments (which had happened in the early nineteenth century) nor by a demagogic parliamentary majority that might abuse its power (which had happened after independence). The problem to be resolved constitutionally was the balance between individual freedoms and a government with sufficient power to rule a country effectively. In other words, there was a tension between the natural rights doctrine, on which the constitutional freedoms and equality before the law were based, and the state’s need to be secure and ensure governability. It has been erroneously argued that Latin American liberalism was unable to implement the constitutional principles. The truth is that insufficient importance has been given to the new civil, criminal, administrative, com182

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mercial, and mining legislation and procedural rules that gave flesh and blood to the constitutional guarantees. Also, insufficient consideration has been given to the changes in the judiciary, which started to become more professional and independent in the last third of the century. The changes were manifest by the last decade of the nineteenth century, when rebellions were no longer just insurrections but demands. Thus it is reasonable to say that the new liberal order had become legitimized, reducing the political tension that had grown in the decades after independence. Liberal constitutionalism clarifies the spheres of competence of the three state powers and sets down their checks-and-balances mechanisms. The great merit of liberalism was that it overcame the rift between the presidency and congress, when the latter wanted to exercise executive functions and the executive had no veto power over congress-approved laws. The rewriting of roles and the creation of supervisory bodies helped overcome the frequent power voids that had allowed the church and the military to step in, the merchants to control public finances, and the local potentates to foment insurrection.

Citizenship, Representation, and Political Parties Latin American liberal constitutions are original blends of liberal, republican, and nationalistic concepts. They were adapted to the multiethnic specificity of their societies and the delayed process of transformation into economic classes. Among the political merits of the revolutions and the liberal frameworks that followed was the strengthening of the notion that the political actor was to be identified as the male head of household, the vecino, recognized at the municipal level, and therefore by the other heads of household, as an honorable, responsible man who was economically self-sufficient. Precisely because the definition of political actor is not political per se (as it was in continental Europe) but was born from the subject’s natural status (as in Great Britain and the United States), the Latin American countries’ many citizens—almost all the adult males—were given the right to vote because rarely was being literate a requirement for suffrage. Building a liberal state required electoral reforms that did not change these criteria but gave municipal authorities or the top taxpayers the task of organizing electoral lists and seats, counting the votes, and sending the results to congress or to the state assemblies. The electoral process was sealed, and the national and state congresses in the federal states (Argentina, Brazil, Mexico, and Venezuela), and the national congress in the other countries, certified the results and proclaimed the winners. The tension between the local and the federal or national dimension is visible in the elite’s intention The Liberal-Republican Political Order

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to use the indirect vote to choose candidates who were eligible to run for office. In Argentina until 1881, in Mexico until 1911, and in Brazil until 1891, the electoral system called for the election of electors, while until the end of the 1800s in Chile and Peru income distinguished a national (holder of civil rights) from a citizen (holder of civil and political rights). The distinction between participating in local elections and in national ones also created differences in citizenship. While in the municipal elections most heads of household voted directly, a smaller number of them could also vote in state elections and an even smaller number in national or federal elections. In this way, although the liberal revolution established a more open system, the income of the head of household separated the citizens who could vote from those who were also eligible to be electors. Unlike the situation in Europe, where the tendency was to broaden the rights of citizens in order to guarantee governability and minimize social unrest, the Latin American electoral system was aimed primarily at organizing the citizens at a national level in an effort to soften localism and enhance the authority of the national state. Thus the electoral frauds on which historians have often insisted were not so much illegal acts as methods for selecting candidates that excluded those who were less likely to be elected. It is true, however, that while the electoral system was still based in elitism, new progressive groups demanded the extension of all electoral rights to all citizens, independent of status, income, or education. From the 1860s to the 1890s the literacy and ethnic/racial requirements gradually disappeared. In Chile an 1874 reform made the right to vote and to be elected universal, which immediately increased the number of citizens from 49,047 to 148,737, that is, from 4 to 14 percent of the total population. For the first time miners and blue-collar workers could vote. Demands for citizenship rights accelerated after 1890. The political clubs and parties wanted greater participation and the right to voting secrecy. Other demands included removing the deputy quotas set aside for the majority that supported the notables, doing away with the government’s role of grand elector, fair representation by adopting the D’Hondt proportional system, and adoption of party lists. As a result of these reforms, the new radical, Catholic, and socialist parties began to send deputies to the legislature, reviving liberal-democratic politics between the 1910s and the 1930s. For sure, these changes reduced the distance between the government and the population. The number of elected notables decreased, making way for new figures with backgrounds in public service, the liberal professions, and business. In Brazil from 1850 to 1880 the number of deputies, senators, and 184

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ministers with a military, ecclesiastical, or judicial background decreased, while those with a background in civil service, commerce, and the liberal professions increased. Already in 1880, 60 percent of the ministers came from public service, 35 percent from the liberal professions, and only 5 percent were large landowners or businessmen. In Mexico from 1900 to 1910 physicians and engineers were most numerous among the 1,591 appointed or elected politicians, while few had a military or business background. The situation in Argentina was not much different: in 1916, 45 percent of congressmen were professionals, lawyers, or physicians. A study of the elite holding high positions in Argentina found that only 25 percent of the presidents or vice presidents of the republic and 14 percent of ministers from 1906 to 1916 came from traditional notable families. Seen through the prism of political representation, a gap seemed to exist between citizens and their representatives, but it was not a large one if we take into account the government’s activism in choosing and supporting local candidates who could harmonize state and national interests. In Mexico, where voters elected not only a deputy and a senator but a substitute for each, the officeholder was, by custom, supported by the governor and the substitute by the federal government or by local groups; the former would sit in congress for the first two years, then the substitute would replace him. Argentina used similar arrangements: local interests made their voice heard in the number of electors that each province sent for the indirect election of the nation’s president. Because of the alliances struck between blocs of state electors under their respective governors, regional interests often influenced the election; once elected, the president would take those interests into account, trying to blend them with the general good of the nation. Unlike Europe, where republicans and socialists saw in representational politics a mechanism for taking power from the citizens, in Latin America the quick acceptance of the system was tied to overcoming factionalism, contrasting regional and national interests and those of the elites and the rest of society. The affirmation of the principle of political representation brought about a system of consociational politics with the president as guarantor, and a political style took hold in the ruling class that was shaped by education, respectability, and consensus. The image of congresses and assemblies dominated by the power of the presidency, which the antiliberal twentieth-century press insisted on without asking questions, is too reductive to explain the new interaction of the regional interests, as expressed in the chamber of deputies, and the national interests, as promoted by the president, senate, and central administrative The Liberal-Republican Political Order

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bodies. The importance that parliamentary debates increasingly assigned to the budget or to the codification or extension of suffrage offer the image of a pragmatic, but also dynamic, political life. Starting in the 1870s, political associationism grew more rapidly than other forms of association, at first expanding intermittently at election time and shrinking or becoming semidormant at other times. Most clubs, especially in the election season, published newspapers, leaflets, and propaganda literature that were read out loud in squares and cafes. In many countries the new Catholic political organizations gave life to conservative parties, socialist organizations became permanent, and both pushed the liberals to form permanent parties. In Buenos Aires, São Paulo, New York, and Boston the popular parties were those managed by political bosses to support the election of specific individuals; in Mexico less personalized parties were built from local networks in the years preceding the revolution. Unfortunately, insufficient evidence survives to permit a retracing of the path from club to political party in the first decade of the twentieth century. The earliest parties seem to have been no more than a federation of clubs since, as was also the case in the United States, the presidential candidates traveled to stimulate national campaigns, which were supported by local clubs. The transition to political party probably depended on the intensity of the opposition to the liberal governments, sparked by the strikes of both blue- and white-collar workers in the early twentieth century. In fact, most parties were born in that period, no matter their place along the political spectrum. Steeped in their strong liberal tradition, the liberal-democratic parties organized quickly in Argentina and Chile. In 1912 the Argentine Unión Cívica Radical adopted a federalist structure like that of the North American parties, organized in a national convention and a national committee and in similar organizations at the regional level. In the early twentieth century the radical and democratic reformist parties of Chile had a similar structure, as did the anti-reelection liberal movement that preceded the Mexican Revolution. More thorny was the path of socialist and Catholic parties. Unlike European workers, who lived only in urban areas, Latin American workers also lived in mining and oil towns and on large commercial farms and therefore were difficult to organize. It was probably easier for Catholics and socialists to organize as federations, giving a large degree of autonomy to the local and provincial groups. The loose organization probably explains why the socialist parties failed to penetrate deeply at the national level. The weak penetration of the socialist parties and later of the communist 186

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ones does not mean that Latin America was free of social conflict. As I noted earlier, social issues emerged forcefully at the end of the nineteenth century and in the first decades of the twentieth. “Social rights” were extended to all urban and mining areas. The social issue, called “social revolution” in many Latin American countries, conditioned political life by pushing the organizations toward becoming parties, with a leadership elected by local representatives and the participation of organized groups from labor, manufacturing, and commerce. Social and labor issues undoubtedly drove the political transformation that began at the end of the nineteenth century; as I discussed earlier in this chapter, under “New Political Actors and Political Forms,” this transformation promoted a renewal of the elite, which developed nationalist, corporatist, and protectionist ideologies that influenced middle-class intellectuals, young military officers, professionals, and industrialists. Although this elite was smaller, less educated, and less wealthy than the old notables and the great bourgeoisie, it was a force that could guide or ally itself with the workers’ movement, even becoming its leader. The importance of the new elite in forming political parties and in the new interaction with the lower classes and the government is demonstrated by the changes occurring in the military, which became professionalized starting in the 1890s. The political importance of the reorganized military rested on its assignment to tasks that were more properly civilian in nature. As a result in the 1920s Argentine, Chilean, Peruvian, and Bolivian officers exploited to their benefit the disorganization of the liberal state and prevented the formation of a new liberal-democratic political system.

Governments, Presidents, and Congresses Harnessing the breakaway tendencies seething right after independence was an enormous challenge since a framework had to be found that would lead the different factions in the various regions back to the center and ensure governability. The issue of political centralization divided both liberals and republicans because it revolved around the form of government to be adopted, that is, whether to choose a unitary or a federal republic. Whatever the choice, it meant restricting the power of the local forces, funneling it to a representative government that could centralize and manage it but reserving some tasks to the states in a federal republic and a modicum of provincial autonomy in a unitary republic. The essential goal was to restructure the ineffective offices and departments that had been created after independence. They were ineffective either because the unitary republics had failed to conThe Liberal-Republican Political Order

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trol the provinces or the federated states had assigned too little power to the federal government. The tension between central and regional powers had limited the exercise of the powers of the presidency, except in Brazil, where until 1891 the executive branch was constituted by the emperor and the prime minister. To prevent presidentialist regimes, the first constituent assemblies had not assigned veto power to the executive, and frequently both deputies and senators had acted as advocates of their own constituents instead of their nation. The reasons for a weak centralization therefore lay in an electoral system guided by the elites’ desire to limit the powers of a national government that could hurt their interests. Even after the liberal revolution the state assemblies tended to remain fiefdoms of elite interests; after the 1850s the legislatures were no longer filled by the old notables but by the new professionals, who went on to become governors or prefects. The new governability would be made possible by a renewal of liberalism, and in fact the new generations accused the old elites of creating anarchy and caudillismo. The new generations realized that creating a national state that could promote progress required, in the words of a politician of the time, creating a solidarity that initially would be mechanical—that is, imposed from the capital—but later, once the benefits of such solidarity had become manifest, would become spontaneous and permanent. All the new constitutions distinguished between executive and legislative power, giving preeminence to the presidency, which was empowered to control the breakaway tendencies of the provinces and states and assign to the legislature the role of supervising and regulating the work of government and ministries. The redefinition of the tasks of the various branches opened the way to centralization, both in federal nations, such as Argentina, Brazil, Mexico, and Venezuela, and in unitary republics. The new national governments had the power to affect the citizens directly, without the mediation of the regional governments. The growing presence at the local level of the national administration and the national army helped somewhat to reduce the arbitrary nature of the local fiefdoms. The process was more challenging for the federations, which had to respect citizens’ right to their regional autonomy but still guarantee their national rights. This double guarantee derives from the double nature of the sovereignty of a federal nation: state sovereignty, which is limited to its own sphere of action, and national sovereignty, which is general and applies to all subjects. The novelty of the federal principle, as it took shape in the mid-nineteenth century, was the idea that both national and state sovereignty are limited. This is reflected 188

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in the structure of the federal government comprised of independent powers—those unique to the federation; state powers, which are defined as residual in that they are not attributed to the federal government; and coordinated powers, which are held jointly by the federation and the states. The new liberal-republican government was thus empowered to guarantee national sovereignty. This slow, not always peaceful, process had to show its effectiveness in order to win over its critics. The strategies adopted to reach this goal were born of the sometimes rocky cooperation between the executive and the legislature. Cooperation was made possible by the gradual persuasion of the legislators that their duty was to pursue the nation’s interest, not merely represent their local constituents, and by the president’s acceptance of congressional oversight and of his duty to listen, mediate, and reconcile the plurality of legitimate interests. The control that the three branches exerted on the armed forces and the latter’s subjection to civilian rule reinforced governability. To properly understand the role of the legislature and the tense, but not conflict-ridden, relationship between it and the executive, it is important to remember that the presidency did not dominate congress. Porfirio Díaz, who was president of Mexico from 1876 to 1880 and from 1884 to 1911, said that in electing senators and deputies the citizens had to reconcile the interests of the regional clubs and the centralization of the federal government. Conciliation mechanisms operated in all countries, especially starting in the last decades of the nineteenth century, so that federal intervention in local issues was no longer necessary. The cornerstone of this balancing act was a two-house system with equal representation for all states in the senate, and representation proportional to the population of each state in the lower house. Thus all existing interests and the new ones tied to the new economy and to internationalization were represented, although not necessarily with the priority they wanted. Incidentally, the number of inhabitants required to elect a deputy usually matched the number in the least populated electoral district, and the number of senators per state was either two or four. The relationship of presidency and congress in both unitary and federal republics was designed to reconcile the various factions and selectively incorporate the emerging classes in political life. The fair representation in government of the different parts of society was guaranteed by elective positions (presidents, congressmen or assemblymen, and governors) and by presidential appointments to ministries, embassies, consulates, captaincies general, and advisory boards. Executive and management positions in the new administrative bodies were also important. The Liberal-Republican Political Order

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One innovation was the adoption of the spoils system—the distribution of positions by the president, who had been elected by a relative majority of the state and district electors, all of whom were influenced by elite interests. Until the 1930s the president was a monarch who took into account the relative importance of the many different interests. Interestingly, the few studies done on the elite political parties reveal that their interests could be very different and factional, leading to tactical alliances or oppositions. The president’s skill consisted precisely in knowing how to manage this complex web, considering traditional as well as emerging interests. Until the 1890s presidents often enforced the spoils system by overriding the interests of the elites, including through armed repression. The presidents manipulated congress and local powers to channel the disruptive forces to the center. Not coincidentally, from the 1850s to the 1890s military expenditures were the largest item in national budgets, and armed interventions led to clashes with congress about the abuse of executive power to quell local unrest or reestablish authority. With the political centralization that began in the 1880s, the spoils system became more distributive and conciliatory. Undoubtedly, this was facilitated by the economic changes and the growth of new public services such as education, health, and urban services. In the 1890s a professional army and updated weapons and technologies began to gradually replace the old military personnel. Although military expenditures did not decrease in Argentina, Brazil, or Chile, they did elsewhere, freeing money for the expansion of the administration. With increased financial resources, presidents used their budgetary powers to manipulate congress; as in Europe, the process of passing the budget entailed forming alliances of political forces in congress. Studies of Argentina, Peru, and Mexico report that the deputies and senators coalesced into three or four groups that competed for seats on the leading committees— interior, budget, and defense—and clashed and compromised on the budget. The memoirs of a turn-of-the-century deputy note that no deputy could face his constituents unless he had secured the construction of at least one new school or one new bridge in his district. In my study of Mexico’s budget policy I note how, in the space of half a century (1868 to 1911), there was no year when congress did not significantly modify the original budget submitted by the president. Starting in the 1890s, the source of the tension between president and congress shifted from political-military to political-administrative, which meant that the ministers, although appointed by the president, began to play 190

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an important role in congressional negotiations. It was as if, in addition to their appointed power, they had become mediators between the legislature and the president and also, in the federations, between the president and the governors. In the same period presidents moved from using a conciliatory type of rule to one founded on compromise and the harmonization of interests. This change was significant, because it shows that the political class, parties, and political system in general had finally accepted the rules of the game of the Euro-American liberal order and that they had become less defensive about innovations emerging from their own countries.

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Five

Westernization

The most significant trait in the evolution of the Latin American world in the nineteenth century was not its modernization but the achievement of the material comforts and cultural sophistication that allowed it to participate in world events with a self-assuredness that would have been unthinkable at the beginning of the century. The new cultural and economic maturity enabled Latin America to face the complex challenges of the twentieth and twenty-first centuries both internationally and on the home front. Another achievement was an expanded capacity to adopt and implement collective decisions with a logic identical to that of the West. Obviously, this does not mean that decisions were not specific to context—they were, and it is perceivable in how they were reached and how Latin Americans interacted with their local or international counterparts. As in the rest of the world, the rationality of collective decisions was shaped by material conditions, cultural traditions, and international connections, without affecting the rationality of the decision-making process. And, of course, the decision-making process does not necessarily produce identical effects, even in similar regions. Analyzing the interaction of Latin America and the world makes it possible to properly evaluate the role of Latin America and assess the factors that intensified or obstructed the impact of its collective decisions, including 192

the role that individuals played in changing how the subcontinent participated in world events. Relations between the subcontinent and the rest of the world had one recurring trait that was already visible in the nineteenth century: the fluctuation between periods of international projection and periods of isolationism, to the point of denying Latin America’s Western roots. The seesaw between internationalism and isolationism reinforces the importance of collective action in the changes that affected the subcontinent: such vacillation means that globalization is not simply a structure external to the needs of individuals but an interactive process between national and international dimensions. This process leads individuals to adopt modes of action and behavior that are transnational in character. In fact, in Latin America today, as in other areas in the world, people participate intensely in public decision making. For this reason in this chapter I will discuss the transnational participation of Latin Americans and others in collective decisions that affected the economic, social, political, cultural, and international life of the subcontinent. The data used in this chapter are from studies covering the period from 1914 to 2000, published before the 2008–2009 financial crisis. F rom I n t e r nat iona l Disor de r to t h e N e w Di pl om ac y

The tension between internationalization and isolationism that accompanied the Westernization of the subcontinent is visible in international relations, as Latin America sought to grasp opportunities offered by the chaos that marked relations between the major powers and between totalitarian regimes and liberal democracies in the period between the two world wars. With the establishment of the United Nations, the tension between internationalism and isolationism subsided somewhat and was redirected to exploiting the advantages of an alliance with the United States. At the same time, Latin American countries continued to nurture multilateral initiatives, which began to surface in weaker areas of the bipolar world. Multilateralism, which began to greatly intensify in the 1980s, allowed the Latin American countries to revise their membership in international institutions and identify in the new regionalism one way of being more active internationally. During this last phase they began to understand the benefits of subsidiarity in order to optimize conflict resolution and establish new forms of cooperation both on the subcontinent and between it and the rest of the world. from disorder to diplomacy

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Nationalism and National Sovereignty The efforts of the Latin American countries to participate internationally were conditioned in the nineteenth century by the essentially bilateral nature of interstate relations and the marginality of the Latin American countries at international conferences, a situation that lasted most of the century. They participated fully only in international commercial and financial networks. The persistent belief in Europe that Latin American countries were behind in their sociopolitical development, and that only when they reached maturity could they aspire to full acceptance, certainly contributed to this stalemate. Both American and European positivists held this opinion. This European prejudice is important for understanding the sort of dissatisfaction about the international order that arose on the subcontinent at the turn of the century, a hostility that would help to transform the idea of nation, born under liberalism, into a nationalism with defensive and aggressive traits that would last for most of the twentieth century. From the outbreak of the First World War to the end of the Second, the world became even more internationalized with the rise of the United States and Japan to great power status. However, the concept persisted of an international order founded on a hierarchy that still favored the great powers. The United States even believed in adapting, to justify its new status, the old idea of translatio imperii, that the decline of old Europe had moved the center of Western civilization to America. The idea of European decadence was revived by the Latin Americans, who also claimed to be the heirs of European humanism and as such worthy of playing a new international role. The persistence of a hierarchical notion of the international order meant that both old and new powers held on to their privileges, which were contested by smaller powers such as Italy, and more generally by those states that felt their sovereignty threatened, and appeased pro-isolationist public opinion at home. Thus a conflict-prone approach became a constant of interstate relations for most of the first half of the twentieth century, in particular from 1914 to 1945, and supported a realpolitik idea of international relations as essentially asymmetric, thereby restricting the avenues of reconciliation of people, ideas, goods, and technologies. This new trend was not without international repercussions, because the new nationalist culture was also the product of the new colonialism, which was born with the 1919 Treaty of Versailles. The treaty identified three types of backward countries: A-type countries, such as those of the Near East, which could become independent in a relatively short time because they had 194

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reached a sufficient cultural level; B-type countries, defined as tribal, such as those of tropical Africa, which needed a long period of European supervision before they could be ready for independence; and C-type countries, which were primitive, such as those of the Pacific area and some in black Africa, and would need an extremely long period under European management. In this last group were such strategic areas as Hong Kong and Singapore, considered crucial for Europe’s control of Asia. The international policy of the United States and the leading Latin American countries was not much different from the Versailles classifications. For Washington the relatively backward countries were India, Indochina, Indonesia, and tribal Africa, as well as Caribbean countries; without saying so explicitly, the United States considered the Latin American states to be holders of only limited sovereignty. Certainly, the persistence of this stratified conception of the international order between the two world wars contributed to international disorder. In fact, Latin American countries and, more generally, those that would later be defined as “Third World” countries went on the international offensive. The international relations of the subcontinent countries in this period took into account their transformation into a Euro-American world. The idea that the subcontinent had shared traditions with Europe was especially alive in public opinion and became a distinctive trait of the nationalism that was especially strong in the new social groups that had emerged during the nineteenth century: the middle classes, urban proletariat, miners, and landless peasants. Nationalist sentiment meant that people had absorbed internationalization and could choose and develop new cultural tools and insert themselves in a conflict-ridden international scene. In this sense nationalism was the new link between the national and the international contexts. Nationalism used the preexisting idea of nation to ensure that the subcontinent would not be trapped inside purely ideological international conflicts. Proof of this maturity is that the subcontinent avoided the choice between Anglo-American liberalism and Soviet socialism, and between those and Nazi-Fascist corporatism. Nationalism adapted to the negative international context that had formed between the two world wars and countered the aggressiveness of the old and the new powers. The many studies dedicated to Latin American nationalism insist on the concepts and policies that were developed to foster cooperation between the different parts of society. The studies do not mention that, like any other cultural phenomenon, nationalism could take multiple forms, nor do they acknowledge the difference between the nationalism of the period between the two world wars and what took hold after 1945. Latin American nationalfrom disorder to diplomacy

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ism has its roots in the idea of nation as formulated by constitutionalism and liberal governments and did not, as in Africa and Asia, begin with the anticolonial rebellions that occurred after the Second World War. Latin American nationalism was born of the liberal idea of a “community of interests” that was developed to defend national sovereignty. Joining nationalism to sovereignty would allow these governments to legitimate their agenda of centralization to citizens at home, while also reinforcing their potency on the world stage. The primacy of the national interest was a reaction to the European tensions that began at the end of the nineteenth century and forced the Latin American countries into a policy of greater international commitment, justifying it with the need to defend their sovereignty. The result was that the new idea of nation was now founded on the presumed or real external threat that the many studies of the early twentieth century identified in the exportation of U.S. utilitarian and economist doctrines, which could undermine the philosophical foundations of Latin American society. At the end of the First World War, one proposal put forth to contain Latin American nationalism was President Wilson’s Fourteen Points, based on the Mazzinian principle of national self-determination that was to serve as guide for the reconstruction of Europe and for a new international system that could “make the world safe for democracy.” The glue that was supposed to hold together the quicksand of each state’s membership in the new League of Nations was international public opinion, which was somewhat naively regarded as the implicit popular sentiment of all peoples. Wilson was surely among the first to understand that the most significant outcome of the liberal revolution was the shaping of an independent public opinion, but he had not considered that harnessing such public opinion was impossible. All the Latin American countries mistrusted Wilson’s 1919 proposals to create one American world to defuse the tension between Anglo-America and Latin America. The world he envisioned would be founded on respect for sovereignty, territorial integrity, and new inter-American institutions that could mediate interstate conflicts and furnish “an example to the world of political and economic freedom and of openness to mutual cooperation.” It could not be otherwise: the continuity between Wilson’s early policies and President Theodore Roosevelt’s “Big Stick” policy justified the hostility to Wilson’s grand international design. In fact, in 1914 Wilson had authorized sending troops into Mexico and had not supported the arbitration proposed by Argentina, Brazil, and Chile that would have ruled out any outside intervention in Mexico’s affairs. For this reason, although sixteen Latin American 196

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countries signed the establishment of the League of Nations, their membership in it would be totally irrelevant. The subcontinent’s rejection of Wilson’s proposals marked the end of the prointernationalist policy that had led Latin America to participate in the victorious English-French-American entente, only to suffer the humiliation of being excluded from the 1919 Versailles Peace Conferences. Like some European countries, the subcontinent began to discard old diplomatic traditions at the end of the First World War. The new international order could not accept the subcontinent’s demands for more inclusion and, specifically, for recognition of the doctrine of total nonintervention in a nation’s internal affairs. The subcontinent wanted some kind of international support against the threat of U.S. domination, which was particularly strong until 1930. The new Latin American policy broke with the tradition of rejecting the intervention of European powers on the continent, a tradition the United States had shared until the early twentieth century. The principle of nonintervention was officially broken in 1905 when the United States affirmed, in Roosevelt’s corollary to the Monroe Doctrine, the concept that it could intervene militarily in the Americas to prevent interference by a foreign power or if a Latin American country refused to acknowledge its foreign debt. The Latin American countries had developed the nonintervention doctrine, which was first conceived by the liberal Argentine internationalist Carlos Calvo in the 1860s, when the liberal states were being formed. The doctrine, accepted by all Latin American governments, was founded on the principle of the equality of all sovereign states, according to which no state enjoys extraterritorial rights; therefore any claim to reparation or to property rights by foreign subjects must be resolved exclusively in the national courts. The Calvo Doctrine was quickly incorporated in international law and invoked to decry the presence of the European powers on the subcontinent. When the United States, Germany, England, and Italy set up a naval blockade of Venezuela in 1901–1902 to force it to honor contracts it had signed with European and American entrepreneurs, the Argentine foreign minister Luis M. Drago sent Washington a memorandum in which he made the point that “the public debt could not be a reason for armed intervention, nor for occupying the territory of American nations.” Drago’s doctrine was accepted by all Latin American countries attending the 1907 Second World Peace Conference at the Hague, which recognized the principle that no country could use force to recover money owed by a foreign government. The conferees agreed that financial disputes should be resolved by arbitration, but from disorder to diplomacy

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this did not satisfy the Latin American countries because, as Drago himself pointed out, arbitration meant that the national courts would be partially deprived of power. U.S. and European opposition to the Latin American demands prevented the creation of a formal Pan-American order founded on the law and instead fueled a growing rift with the United States that continues to this day. The result was that inter-American relations would be based on power, the same principle that governed international relations between the two world wars. Relations of the subcontinent, Europe, and North America were tense even before the 1929 stock market crisis, which has long been considered the element that unleashed the long-simmering conflicts among the three blocs. The economic crisis would do more harm than good, unless one counts ideologies among the benefits. The final crisis of the gold standard, despite several efforts to save it before the 1929 crash; the appearance on the international scene of “sweepers” such as Fascist Italy, Nazi Germany, Japan, and the Soviet Union; and, finally, the continued existence of the international “directoire” of the victors of the First World War put into question the principles of freedom and international cohabitation. As a result many countries based their actions only on considerations of power, measuring power in industrial production, cannons, and armies that could control territories, both inside and outside their borders. These countries sought territories that could become markets for excess production or sources of fuel and raw materials that were essential to their security. Other states quickly copied the example of the leading powers. In Latin America the attitude of the leading powers helped revive the arguments of social Catholicism, fascism, Nazism, corporatism, and socialism, that nationalism should pursue a conscious policy of aggression in any part of the world, including the subcontinent. Starting in the 1920s, Latin America’s international policy was influenced by nationalism and became fragmented and distrustful of the international order. Latin America faced a threatening U.S. presence and an ineffective League of Nations, and the nationalism of the subcontinent was fed by fascism, Nazism, and the clerical-totalitarian corporatism of Franco’s and Salazar’s regimes. The totalitarian ideologies provided governments and public opinion with justification for voicing dissatisfaction. Nation and state meshed, leading to a single political and institutional reality. The totalitarian doctrines allowed states to spread the idea that these doctrines could best represent a nation’s strength and vitality. This led to an enormous expansion of presidential pow198

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ers that allowed presidents to corporatize interest groups and transform them into organizations that reported directly to the president. The need to defend the nation from internal threats but especially from growing external threats was the justification for the new presidentialist system. The greater authority of the state allowed it to disregard international limits; backed by public opinion, the countries denounced restrictions on national sovereignty as forms of imperialism. They hurled this accusation not only at foreign states but also at foreign corporations and neighboring states. All this helped to increase the international malaise that was already brewing before the 1929 stock market crash. Latin America experienced the world economic crisis as the end of an era and proof of the unfairness of a U.S.-dominated economic system. One effect was to strengthen the economic aspect of nationalist ideology: starting in the 1930s, in fact, the Latin American countries regarded market forces as a threat to their territorial integrity and denounced the recurring crises as a tool of capitalism that impoverished the raw materials–producing nations, preventing their industrialization. Therefore, to erase poverty and economic backwardness, Latin American countries had to empower the state to intervene in all spheres of national life. Soviet socialism also played a part in the shaping of 1930s nationalism. A good part of Latin American public opinion, although not particularly disposed toward socialism, regarded the Soviet Union as an experiment that was not necessarily antagonistic to right-wing totalitarian governments; public opinion saw the socialism being built in the Soviet Union as a means to recoup lost time, a shortcut to the modernization of the industrial base. In fact, politicians were especially impressed by the notion of economic plans and the implementation of the first five-year plans that began in 1928 and gave the Soviet Union the veneer of enormous productivity at a time when the capitalist world was in a state of crisis. The Soviet Union was sending strong signals in the 1930s that industrialization was around the corner, given the increase in Soviet industrial production from 5 to 18 percent of world industrial production from 1928 to 1940. Obviously, the extremely high social and human costs of the Soviet plans were ignored even by the press, for such costs were believed to be a necessary sacrifice to reach the paradise of development. The image of a Soviet-type socialism under the strong hand of a leader like Stalin and a strong state reached the subcontinent in 1934 through the new popular front strategy that favored the creation of progressive alliances between socialist-leaning parties and reformist ones. The popular fronts were approved at the Seventh from disorder to diplomacy

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Comintern Congress (1935) at which the Soviet Union suspended its rigid class position. The international dissemination of ideas not only reinforced Latin American nationalist ideologies and policies but was regarded favorably by the United States, the only country that could offer economic advantages to the subcontinent. Although Washington had not officially accepted the new parameters on the threats or on the effective use of force internationally, its conduct, as set down in the Roosevelt Corollary, was consistent with such a policy. Just like the European countries, the United States used its power to try to control other countries; it redesigned its expansionist policy by extending into Latin America, which the United States considered its second southern frontier. In practice, just as Japan had done in the Far East, Germany in eastern Europe and partially in Africa and Latin America, Italy in Africa and partially in the Balkans, the United States defined its sphere of influence by imitating what the old colonial empires, Great Britain and France, had done in their time. The construction of a U.S. sphere of influence in the Western Hemisphere met with stiff resistance from the reformist and progressive movements and the Latin American governments, which demonstrates how popular nationalism was among the middle and lower classes. This reaction forced the United States to place greater emphasis on the commercial and financial aspects of U.S. policy in order to promote alliances with some members of the elite and bourgeoisie.

The Inter-American Subsystem In the preceding section I tried to show that inter-American relations were not propelled by just one force, the United States, but by the interaction of U.S. policies aimed at controlling Latin America and the nationalist positions and policies supported by Latin American public opinion. This interaction led to the failure of the U.S. attempt to establish a protectorate in the early 1900s and to build an economic sphere of influence in the 1920s and 1930s. The “Good Neighbor” policy inaugurated by President Franklin D. Roosevelt in 1933, part of the New Deal, was a shift because it took into account the subcontinent forces opposed to U.S. hegemony and the need to isolate Latin America from fascist, Nazi, and Soviet totalitarian temptations. This shift cannot be understood without taking into account the impact of the 1929–32 international economic crisis that, even as it negatively affected the subcontinent, partially redressed the imbalance that had developed between the United States and Latin America.

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The moratorium on repaying foreign debt (owned mostly by U.S. banks and investors), decided unilaterally by the Latin American governments, was the most significant reaction to Washington’s aggressive policies. According to U.S. estimates, the moratorium applied to $1.2 billion, or 5 percent of the world’s trade volume in 1929. It is important to note that the unilateral decision was taken by the Latin American countries to reassert their sovereignty, which they justified by invoking the Calvo-Drago Doctrine. The decision was a reaction to the strong pressures applied by the United States at the 1928 International Conference of American States on Conciliation and Arbitration held in Washington, where it was decided that the American states were obligated to turn to arbitration to resolve foreign debt issues, as the 1907 Second World Peace at the Hague had ruled. What was different was that the economic crisis supplied the excuse to reject the principle of arbitration and claim political and financial sovereignty. Although the moratorium had a major impact on Wall Street, the United States did not send in gunboats, as it might have done a decade earlier. The weak U.S. reaction probably owed to the economic crisis and the isolationist tendency of those years that was led by public opinion in the western and midwestern United States and affected U.S. foreign policy. The new inter-American relations that FDR envisioned were part of the U.S. plan to end the old European-based international system. Roosevelt intended to find new flexible arrangements to relaunch international cooperation, which would include a strong U.S. presence globally. In the final analysis Roosevelt’s goal was to reassure a U.S. public alarmed by the monetary crisis, which had been precipitated in part by the definitive demise of the gold standard, and by the growing threat of the totalitarian powers, which could—and did—lead to a new world war. Thanks to Washington’s growing international influence, Roosevelt’s New Deal did promote the transition from the chaos that had marked the years before the First World War to the new order under the umbrella of the League of Nations. His Good Neighbor policy toward Latin America was an experiment in a region vital to U.S. interests. In fact, at the Seventh Pan American Conference in Montevideo in 1933, the United States once and for all accepted the principle of absolute nonintervention and signed a declaration that “no state may intervene in another’s domestic or foreign affairs.” In applying this principle, the United States took formal exception to the clause that authorized it to intervene in Cuban foreign affairs and withdrew the troops it had dispatched to Haiti in 1916. In the end Latin American pressure, including

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the foreign debt moratorium, forced the United States to give up the idea of building its own sphere of influence in Latin America. In the 1930s the reappearance of Germany and Italy on the Latin American scene played a role in Latin America’s rift with the United States. The greater German and Italian presence on the subcontinent resulted from the desire to expand trade as well as from immigration. At a time when all countries were giving up the gold standard, Germany and Italy had created new financial mechanisms to expand their commerce, such as bilateral compensation to minimize the use of hard currency, stressing the complementary relationship of the industrialized countries and the countries that were producing raw materials. To keep Argentina in its commercial orbit, Great Britain granted Argentina the status of “preferred trading partner,” which guaranteed all Commonwealth countries that their products could enter the British market. The subcontinent states believed that the deferred trade of raw materials or semifinished goods for industrialized products was advantageous, for under the deferred trade system (also known as barter trade or monetary barter), a country would import from another country goods whose value did not exceed that of the exports to the same country, thus allowing the country to control and restrict the outlay of hard currency. The United States also had to create new compensation mechanisms when it was forced to rescue Cuba financially after it was hit by the drop in the international price of sugar and by the provision of federal subsidies to U.S. domestic producers of sugarcane. To resolve the crisis Cuba and the United States negotiated a new trade treaty in 1934 that allowed more Cuban sugar to enter the United States in exchange for reduced Cuban customs duties on U.S. industrial goods. To implement this plan, in the same year the U.S. government founded the Export-Import Bank (Ex-Im Bank), which provided medium- and long-term financing at favorable interest rates to the Latin American countries that purchased semifinished and capital goods from the United States. While the totalitarian countries created the deferred trade concept, the United States invented the fixed loan. In addition to the Ex-Im Bank, the United States created two other institutions that supported the Latin American economies: the Exchange Stabilization Fund of the U.S. Treasury (1934), which offered liquidity in hard currency, more specifically, in dollars, to stabilize the Latin American currencies–dollar exchange, and the Federal Loan Agency (1939), which facilitated the supply of capital goods to Latin American public and private concerns. It was a significant step; when World War II began, the United States would extend the Lend-Lease Act to the subcontinent; the law empowered the U.S. president to lease defense equip202

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ment to other countries. These new mechanisms provided precedents for the provision of development aid after the war and showed the subcontinent that the United States could do more and better than the European totalitarian countries. Between 1934 and 1941 the Ex-Im Bank issued fixed loans for $306 million. The new policy was made explicit by Roosevelt’s attendance in Buenos Aires at the 1936 Inter-American Conference for the Maintenance of Peace, when he applied the Good Neighbor policy to cultural exchange programs aimed at “Americanizing” Latin American culture and technology to fight the influence of Europe and, in particular, of the totalitarian countries. Even amid the tense relations of the 1930s, cultural exchanges and institutes multiplied. The competition of the leading powers and the Latin Americans’ receptivity broke up the U.S. efforts to culturally colonize the subcontinent. Because all the big countries were willing to give concessions, the Latin American countries knew they could exploit the situation. The most innovative action came from Mexico, when President Lázaro Cárdenas (1934– 40) reorganized in a corporatist sense the political system that had come into being with the 1911 revolution. With the steadfast support of the new revolutionary party, the Partido de la Revolución Mexicana, founded in 1938, and taking advantage of a favorable climate to promote the image of the new nationalist, anti-imperialist state, Cárdenas nationalized the oil industry, wresting it from the multinationals and creating a state company that still exists today, Petróleos Mexicanos (Pemex). The expropriated companies, led by Standard Oil of the United States, mounted a campaign that presented Mexico as a Bolshevik country and pressured Washington to intervene, but the federal government remained neutral. Not only did the United States not freeze diplomatic relations with Mexico or impose economic sanctions, but it pressured the oil companies to reach a settlement directly with the Mexican government, which they did in 1941. The Good Neighbor policy gave legitimacy to the nationalist policies of the Latin American countries and reined in their “sweeper” behavior. Still, Central American and Caribbean countries did not declare war on the Axis until 1941; Mexico and Brazil did so in 1942; Colombia and Bolivia in 1943. Argentina, Chile, Uruguay, Ecuador, and Venezuela joined them only in 1945, when the war was nearly over. In the chaotic period between the two world wars, the Latin American countries, like the smaller European countries, looked selfishly after their own national interests; this opportunistic attitude also prevailed in relations with neighboring states. Conflicts broke out between Bolivia and Paraguay with the Chaco War (1928–35) and from disorder to diplomacy

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between Ecuador and Peru (1938–42), and recurring border issues flared as each country tried to seize real or imagined oil-rich lands. This new state of conflict was a different manifestation of the nationalism that incorporated the geopolitical concept that states must promote progress by controlling their strategic resources (even nationalizing them), including the raw materials and energy sources believed to be essential to their self-sufficiency and industrial growth.

Entry in the United Nations The end of World War II inaugurated a new season of participation in the international concert for Latin America. The foundations of the new system were laid out at the 1945 San Francisco Conference, which created the United Nations Organization. The charter gave the U.N. the potential of developing into a network of bodies covering the full range of international activities. The charter placed international security under the jurisdiction of the United Nations, thus opening up a vast new field of international cooperation that ranged from economic, social, and cultural cooperation to international justice and oversight of the administration of colonial territories. Although the new organization felt the influence of Wilsonian idealism and the joint pressure of the United States and the Soviet Union, the presence of all the states in the Constituent Assembly and the growing influence of the national liberation movements made the United Nations a vehicle for something more than state-to-state relations. The U.N. came to oversee the protection of civil rights and social progress, which until then had been the exclusive province of each nation-state. Thus the U.N. Charter opened the way to a process—that in many ways remains unfinished—of redefining the key principle of international coexistence, namely, the sovereignty, domestic as well as external, of each state. The process was slow because the U.N. was founded on the principle that all members are equal; as an interstate organization, it cannot make decisions in the real sense of the word, that is, it cannot adopt by majority rule a decision to which a minority objects and that would require force to implement. In other words, the U.N. does not have the power to coerce its member states; the result is that instead of a world government, it is a permanent diplomatic congress, or, rather, a multilateral organism whose solutions required, even during the cold war, the consent of Latin America, Asia, and Africa, which together constitute a simple and a qualified majority, and of interim members of the Security Council, which initially was dominated by the victors of the Second World War and the countries that they had saved: Great Britain, France, and China. 204

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The multilateralism set in motion by the nation system, supplemented by the U.N.’s specialized institutes, centers and programs, regional committees, and specialized bodies, has enabled small countries to increasingly participate in the hundreds of international multilateral bodies that were formed after 1945. Their membership in the U.N. has been beneficial. During the most intense cold war phase and until the 1970s, the balance of the superpowers depended on the participation of the small and medium-sized countries in one bloc or another. This diffusion of power was important not only for the Latin American countries but also for the African and Asian states that achieved independence between 1945 and 1970. The U.N. has generally tried to moderate Third World nationalism, Latin America’s in particular, which as a result no longer considers the international system a threat to independence and sovereignty. This, of course, does not mean that the preexisting tension between internationalization and fragmentation has been overcome but simply that hostile confrontation has morphed into a search for new forms of interstate cooperation. The participation of the subcontinent in the international system in the most intense phase of the cold war, from the late 1940s to the late 1960s, has been read as one of subordination to the power of the United States. This reading forgets that when the United Nations was founded, the nineteen Latin American states constituted 40 percent of the fifty-one founders and that as late as the early 1960s they were the only Third World members. At the time the participation of Latin American countries was important not simply because of their quantitative influence in the U.N. General Assembly but because Washington regarded them as a bulwark against the threat of Communism. The subcontinent also felt the need to resist Soviet penetration; this entente would be shaken only by the 1959 Cuban Revolution. The United States believed that to guarantee its security, it had to create a system that included the entire continent and that to succeed it needed the consensus of the Latin American countries. To secure it, the United States turned to Roosevelt’s Good Neighbor policy, which was introduced a good ten years before the onset of the cold war, and a new policy of cultural convergence and military aid. The new policy was designed to channel Latin American nationalism by creating an inter-American area, a democratic space where all participating countries could adopt a shared approach governed by liberal principles without forsaking their national interests. Mindful of the partial defeat of its expansionist designs in Latin America, after the Second World War the United States enacted a flexible, pragmatic, bilateral, and multilateral policy to contain any Soviet penetration. from disorder to diplomacy

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In many ways Latin America became the experimental lab for Washington’s policy for Third World countries during the cold war. It was born from the tense relations with the subcontinent in 1943–48 that were exemplified by the conflict that erupted at the 1945 Inter-American Conference on the Problems of War and Peace at Chapultepec, Mexico. Subcontinent delegates strenuously opposed Washington’s proposal to liberalize trade, privatize the state-owned companies founded between the two wars, promote the establishment of free labor unions, and adopt new ways to market raw materials. The clash was resolved when the United States accepted the nationalist policies of the Latin American countries if they would curb their isolationism and protectionism. U.S. policy toward Latin America and the Third World became more clear-cut in the late 1940s when the United States adopted George Kennan’s containment policy to stop Soviet expansionism. This policy applied to inter-American relations the concept that, to save the continent from Soviet exploitation, the United States would foster economic growth by supporting the price of the raw materials that the subcontinent exported and by guaranteeing the free international circulation of its products; in turn, the Latin American governments pledged to not adopt policies that would promote an anti-U.S. public opinion. The cold war and the containment policy initiated a relationship that would last until the 1960s, when the United States dropped Roosevelt’s liberal-democratic outlook in favor of a consociational realpolitik relationship based on the offer of economic benefits in exchange for political subordination. As a result the United States strengthened financial institutions such as the Ex-Im Bank and supported Latin American interests in the international financial bodies spawned by the Bretton Woods Conference (1944): the International Monetary Fund and the World Bank. These new bodies created an open financial system founded on multilateral payments, exchangerate stability, convertible currencies, and compensation mechanisms to help countries with temporary trade imbalances; this made it possible to offer credit and financial and economic assistance to the Latin American countries in order to secure their commitment to international security. Latin America’s engagement in the cold war bloc began at the 1947 InterAmerican Conference in Rio de Janeiro with the signing of a mutual defense treaty with the United States. In 1951 the U.S. Congress approved military aid to the subcontinent, implementing the central goal of securing the safety of the hemisphere with the active participation of all the countries of the subcontinent. This treaty illustrates how inter-American relations became 206

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the basis for U.S. power politics worldwide. In fact, two years later the North Atlantic Treaty Organization (NATO), joined by all European countries, was born at the 1949 Brussels Conference. Both the inter-American treaty and NATO were defensive alliances against potential enemies of individual liberties, of a law-based state, and, more generally, of democratic institutions, and both treaties committed all members to help any member country that came under Soviet attack. Inter-American relations after World War II undoubtedly had a negative impact on the domestic front because they strengthened the policing power of the military and created the conditions for approval at the 1948 InterAmerican Conference in Bogotá of a regional body—the Organization of American States (OAS)—which the subcontinent had previously opposed. Although OAS was hailed as a regional institution under the U.N. umbrella, the Latin American countries were hostile to it because they did not believe they would benefit from such a close association with Washington at a time when it was more interested in Europe, as demonstrated by the Marshall Plan. This resistance was clear in the slow pace with which the Latin American countries implemented the OAS, which began to function only in 1951. The United States was forced to accept an OAS structure that did not provide for a permanent council or strong secretary general but specified instead a strong general assembly that could thwart any policies that the United States might try to impose. Thus from the very first Latin American nationalism conditioned the OAS and U.S.–Latin American relations, for the United States was interested only in its external safety, whereas the Latin American countries were seeking aid and loans to stimulate industrial growth. In this nationalistic logic, from 1950 to 1970 the Latin American countries saw only the benefits of economic cooperation with the United States, while for the United States economic cooperation was to be a by-product of strategic and political alliances. The Latin American countries’ economic realism is well illustrated by their having won in 1948, despite U.S. opposition, the right to a special U.N. agency, the Economic Commission for Latin America (UNECLA), with headquarters in Santiago de Chile. Notwithstanding the institutional limitations and mistrust, one major success in the 1950s and 1960s was the end of conflicts between the various subcontinent countries, some of which dated to the previous century and had intensified in the period between the two wars. One of OAS’s more significant roles was to mediate the conflicts between Costa Rica and Nicaragua (1949 and 1955–56); the Dominican Republic and Haiti (1950); Honduras from disorder to diplomacy

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and Nicaragua (1957); Nicaragua, Costa Rica, and Honduras (1959); and the Dominican Republic and Venezuela (1960–62). Although it has been argued that the resolution of these conflicts was a direct result of U.S. power, it is also true that in those years the Latin American countries learned to cooperate with one another in order to rein in Washington’s power. This intrasubcontinent cooperation was also a result of the countries’ unwillingness to give the OAS a decidedly anti-Soviet bent, as the United States wanted. The Chinese Communist victory further hardened Washington’s stance, such that in 1950 the National Security Council even theorized that the Soviet Union would outstrip the West. To counter this threat, Washington united both old and new European allies in the struggle against the Soviet Union and at the same time reinforced relations with Washington’s Latin American allies. At the 1954 Inter-American Conference in Caracas, all members pledged to intervene militarily should one fall under the control of the “international communist movement.” Very likely, the interest in creating a strong anti-Soviet bloc in the West prevented the United States from noticing the subtle differences between the international context, characterized by U.S.-Soviet opposition, and the regional context, characterized by the opposition of Latin American national interests and North American strategic interests. The result was that the United States actively discouraged any reformist policies begun on the subcontinent to assuage social conflict, such as those of the progressive (but not communist) revolutions of Bolivia (1952) and Guatemala (1954). The U.S. efforts received indirect support from the OAS, with the other Latin American governments unhappily going along. The waning enthusiasm for the struggle against the communist threat did not prevent the Latin American countries from exploiting the cold war to their own benefit. Brazil, which had a very active foreign policy, launched an offensive called “Operation Pan-America” during an informal meeting of Latin American foreign ministers in Washington in September 1958. It called for a new type of cooperation between Latin America and the United States to improve the quality of life and accelerate economic growth on the subcontinent. The new program included a financial arm to promote economic development and a committee to advise on strengthening economic cooperation among the Latin American countries and between these and the United States. Thus the Inter-American Development Bank (IDB) was established in 1959, and the following year President Eisenhower stated his support for an economic development program to be managed by the new bank. Finally, in 1961 President Kennedy created the Alliance for Progress, 208

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which linked economic growth to social reforms such as agrarian reform, expanded public services, and improvements in the quality of life of the poorest strata. Even during the cold war and Washington’s inflexible foreign policy, the U.N., OAS, and IDB promoted the greater involvement of the Latin American countries in the international system and an end to their age-old tensions. The advantages gained were the large amounts of U.S. and international funds that began to flow to the subcontinent and that were used to carry out nationalist policies. Nevertheless, anti-Yankee public opinion and policy grew rapidly in the 1960s, intensified by the excessive, almost paranoid, U.S. insistence on security, a preoccupation that its allies did not share to the same degree. This situation pushed democratic values and the free circulation of the means of production to the back burner and created the basis for a long period of noncommunication between the United States and Latin America that not even Kennedy’s Alliance for Progress could breach.

Polycentric Tendencies While the superpowers were running an extended arms race to defend their respective blocs, the tension between old bilateral relations and new multilateral ones encouraged polycentric tendencies within each bloc. This new tendency, which also affected Latin America, is visible in the changes in the balance of power. Until the early 1960s the two superpowers were the sole owners of the nuclear deterrent and flaunted their military, diplomatic, and economic strength in many parts of the world. Starting in the 1960s, weaker nations claimed a role in the bloc system, thanks to the increasing sophistication of their diplomatic corps as a result of their exposure to international culture and the politics of international organizations, and because of the greater influence that Western Europe and Japan were beginning to bring to bear. The result was that the bloc system weakened as all areas claimed greater relative autonomy, tended to question the superpowers, and demanded to be counted and recognized as interlocutors. With decolonization, the rebirth of Europe, and the unrest that was starting to undermine the Soviet bloc, regional bodies proliferated and three levels of powers became reestablished, as in the past: superpowers, mediumsized states, and small states. This polycentric dynamism brought an end to bloc opposition and the birth, as yet incomplete, of a multipolar international order in which the tension between conflict and cooperation holds war at bay and strengthens cooperation through international and regional institutions. First polycentrism and later multilateralism promoted a new kind of interfrom disorder to diplomacy

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action between nation and world that was marked by significant limitations to national sovereignty. This trend surfaced first in Europe, where the idea of the nation-state began to decline just as it began to assert itself in Africa and Asia. In many cases there were terrible regressions, including bursts of ethnonationalism, an ideology that claims the complete identification of a territory with a single ethnic or religious group and rules out any form of coexistence with other groups. The installation of Soviet missiles in Cuba after the island joined the Soviet bloc (1962) implied a threat to U.S. security that forced the superpowers to reexamine their reliance on the nuclear deterrent—also known as the “balance of terror”—to balance power. The result was a transition from deterrent to containment, and a “normalization” and détente phase marked by the policy of nonintervention of the superpowers in each other’s affairs. Nuclear détente treaties were signed to ban nuclear testing in space and in the oceans (1963), ensure the nonproliferation of nuclear arms (1968), prevent nuclear war between the United States and Soviet Union (1973), and limit strategic arms (1972 and 1979 SALT agreements). However, the principle of nonintervention meant that in case of an uprising in a country within the one bloc, the other superpower could not aid the rebels or grant them diplomatic recognition. While the United States stood on the sidelines during the 1968 Soviet repression of the Prague Spring and during the 1971 and 1981 Polish uprisings, the Soviet Union actively supported anti-American forces in Santo Domingo (1965), Chile (1973), and Nicaragua (1981). In other words, low-intensity conflicts had no effect on relations between the superpowers, unlike what had happened in Greece, China, Korea, and Vietnam in the 1950s. The coexistence of the two powers defanged domestic opposition within each bloc, though domestic opposition was more marked in the Western bloc than in the Soviet bloc. A significant cultural shift led to the demise of these spheres of influence and was reflected in the loss of consensus for the policies of the superpowers in general and in the decisions of the smaller states to take issue with the superpowers on specific issues, in particular, nuclear weapons, decolonization, and the expansion of military and economic power. Not coincidentally, in the 1960s the era of ideological confrontation—the stark opposition of communism and capitalism—was starting to fray. This awareness translated in Europe as backing a foreign policy aligned with the West yet linked to a cautious management of relations with the Soviet bloc. Significantly, at this time Western European communism became more polycentric, making it more compatible with democratic institutions. The polycentric tendencies within the blocs, especially those that arose in 210

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the 1970s, led to the progressive breakdown of the postwar order, which had begun to feel stiff and overregulated. In this redesigned world order, decolonization played a significant role because it increased the number of states participating in the international system. The active forces in this process were the superpowers and the United Nations; together they hastened the process, such that in 1955 at the first Asian-African Conference in Bandung, the new states did not ally with any superpower but demanded a larger role as well as greater support for their growth from the developed countries. In 1950 Latin America, Africa, and Asia held a majority in the U.N. General Assembly that in turn accelerated the decolonization process. From 1960 to 1973 most new states made their presence felt, giving rise to a movement of nonaligned countries and strengthening their equidistance from the two blocs. Because of their nonalignment these countries were able to voice their desires, such that the 1964 U.N. Conference on Trade and Development drew up a shared platform of economic demands very similar to those demanded of the U.N. in 1948 by Latin America during the creation of UNECLA: they asked for technical and financial assistance, stable raw materials prices, and support for the social development of Third World countries. As had been the case for Latin America, the nonaligned countries did not question the Bretton Woods agreements, for these nations were not interested in breaking with the World Bank, IMF, or the Council for Mutual Economic Assistance, the Soviet bloc agreement. Interestingly, the only Latin American country among the nonaligned states was Cuba, which had been excluded from the OAS in 1962. Although in the widened international system the Latin American states were penalized for their alignment with the West, since they were no longer the only Third World countries, even in 1960–73 the subcontinent benefited from the “development diplomacy” devised by President Kennedy to win the Soviet challenge, ensuring the United States access to raw materials and giving the Third World hope for democratic change. The subcontinent understood the importance of the substantial offer of capital for its own development; in those years international liquidity was augmented by a new type of international capital—official aid. The logic behind this offer, extended by almost all industrialized Western countries, was that to significantly increase production, the “underdeveloped” countries needed a set volume of imports. The handicap was that their imports grew more rapidly than their exports, creating a gap that could be filled in the medium term with development aid, that is, reduced-interest loans, sinking funds, and free technical assistance. from disorder to diplomacy

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The Latin American states’ lack of enthusiasm for nonalignment was not due to public opinion, for especially from 1960 to 1980 anti-U.S. sentiment was strong because of the constant American meddling in Latin American domestic affairs. But unlike the nonaligned Third World countries, the Latin American countries tried to revive relations with Western Europe in order to counter U.S. power. The visits to Latin America of French president Charles de Gaulle, Italian presidents Giovanni Gronchi and Giuseppe Saragat, and German Chancellor Konrad Adenauer were accompanied by agreements diversifying Latin American imports and exports. In the 1970s the latter led to agreements with the European Economic and Social Committee and marked the beginning of a new Euro–Latin American cooperation. In reviving Euro–Latin American relations, the oil crisis of 1973 and the decision that same year to take the U.S. dollar off the gold standard played an important role. In fact, starting in 1973 the leading subcontinent countries began to turn to the European capital market, which grew in the 1970s because of the liquidity resulting from the oil surplus, and which offered financing that was considered more flexible than that available in the U.S. market. From 1973 to 1979 countries such as Brazil, Mexico, Venezuela, Argentina, Chile, and Peru received $65 billion in loans from the European financial markets. Stimulated by this resumption of relations with Europe, breakaway tendencies in Latin America led to a gradual disappearance of the idea of an inter-American cooperation with the United States or even of a pan–Latin American cooperation. This last idea had given rise in the 1960s to such regional economic institutions as the Latin American Free Trade Association (1960), the Central-American Common Market (1960), and the Andean Pact (1969), which tried, albeit with modest results, to bring together countries in various stages of development. The centrifugal tendencies were not just the result of the belief by Latin American countries that cooperation with the United States was bound to be limited but also, and especially, of Cuba’s move to the Soviet bloc. While this made the Soviet threat more real for the United States, for Latin American countries it was a unique occasion to force the Yankees to reexamine their relations with the subcontinent. In this climate of heightened tension the OAS lost importance and the Alliance for Progress failed. Toward the end of the 1960s people believed that relaunching multilateral cooperation was impossible. This impasse continued into the 1970s and led to a new wave of extreme national-populist sentiment with strong tendencies to neutrality. For its part, the United States intensified its anticommunism (especially after the 1970 victory of the socialist and populist coalition 212

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in Chile) while renewing bilateral relations that were advantageous to the United States. In the 1960s and 1970s informal politics within the subcontinent and between it and the United States and Europe became stronger, and the subcontinent renewed bilateral relations with the United States. The high point of this bilateralism came in the 1970s during the Carter presidency. Jimmy Carter preferred to solve conflicts by negotiating directly with each country, trying to contain and solve problems without resorting to the OAS. In fact, the 1977 Panama Canal Treaty, which granted sovereignty over the canal to Panama while allowing the United States to defend the canal if its neutrality were threatened, was an important issue for all Latin American countries, but Panama and the United States signed it without consulting them. Even more significant was Washington’s containment of the Cuban presence in Angola (1976) and Ethiopia (1978), again carried out without seeking assistance from its Latin American allies. The effects of this bilateral policy are visible in Washington’s gradual disengagement from the OAS, such that the U.S. stopped its contribution, throwing the organization into a severe financial crisis. As a result the Latin American countries took a stronger approach to the OAS, in 1979 even establishing, against U.S. opposition, the Inter-American Court of Human Rights sitting in San José, Costa Rica, and charging it with the task of implementing the Inter-American Human Rights Convention, which had been approved in 1978. The Latin Americanization of OAS became visible when the organization began to take positions favoring political democratization: in November 1980, for the first time in its history, the OAS denounced the continuing human rights violations by the authoritarian regimes of Argentina, Chile, El Salvador, Haiti, Paraguay, and Uruguay. Only Argentina’s threat to withdraw from the organization blocked a resolution that would have deemed those countries as having placed themselves outside the inter-American order.

Latin America in the Multilateral Order One of the more significant aspects of Latin America’s international involvement has been its ability to maintain a clear Western orientation, which takes into account both its heritage and the multiple cultural and scientific exchanges that began in the 1950s and accelerated in later years. In addition to illustrating the Latin American alliances with the West, map 6 shows that the Western orientation was only partially because of some strong residual elements, such as the persistent nationalism that in the 1970s still looked favorably on antiglobalization movements. It is true, however, from disorder to diplomacy

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that the nationalist revivals that surface in times of economic or political crises have grown weaker in recent decades. In the 1980s a new form of Latin American solidarity emerged, built around the newly embraced path toward democracy, with new forms of cooperation in the hemisphere and a redefinition of cooperation with the United States and Europe. Since the end of the cold war, one of the more significant global changes has been the spread of liberal democracy. Democracy has become a fundamental cultural and political value, not only for the countries that have been advocating it since the end of the Second World War—a restricted club that includes Western Europe, the United States, and Canada and reaches the western extensions of Australasia. In Latin America democracy was not a universally accepted value and was confused with nationalism-populism, leftist insurrectionist tendencies, and revolutionary movements. In 1950 only thirty states in the world, or 23.8 percent, were liberal democracies, and, of these, twentytwo belonged to the old democratic club. Half a century later seventy-eight states, or half the world’s states, were democratic (those that hold free elections, enforce constitutional guarantees and civil and political rights, and support the autonomy of political, labor, and religious associations). At the end of the twentieth century all parts of the world saw authoritarian regimes become liberal democracies; this was especially so in Latin America, where from 1955 to 1995 the number of states considered democratic increased from seven to twenty. Still, public opinion and anti-Westernization movements stress the need to maintain strong nation-states, to prevent globalization from perverting their economy, condition their political life, and transform national culture. Antiglobalization tendencies take many shapes; although they claim to have Amerindian, African, or mestizo origins, they use the same mass media tools of the opposition, the “neoliberal” movements. Although “no global” demonstrations are usually associated with left-wing politics, a danger exists that the antiglobalization forces could help revive populism and nationalism or be exploited by right-wing movements. The persistence of populism and nationalism underscores the fact that, although the subcontinent’s democratic orientation started to become stronger in the 1980s, Latin America has not lived up to the expectations of the international watchdog organizations. At the cusp of the new millennium, democratic life was weighed down by a disinterested, apathetic citizenry disappointed by its governments’ failure to provide essential services such as courts of justice, safety, education, and health care. Thus as the twentyfirst century dawned, Latin American democracies were of low quality and effectiveness and, as such, very vulnerable. 214

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Shifted from East to West during the cold war Shifted from West to East during the cold war Central states of the Western military bloc States with strong economic relations with the West Central states in the Eastern economic and military bloc States with close relations to the East Nonaligned states

map 6. The System of International Alliances, 1945–1990

All groups, no matter their agenda, can make use of propaganda. Whereas at the end of World War II the world was still connected by the same basic telephone technology in use fifty years earlier, recent innovations have transformed the breadth, speed, and quality of communication, and reduced the costs, thus democratizing its use. The introduction of fiber-optic communication has lowered intercontinental communication costs, from $500,000 per line in the 1950s to a few thousand dollars in the 1990s. The diffusion of television, personal computers, and cable networks is a reality not only in Europe and North Atlantic countries but also in Latin America, thanks to the changes that occurred in the 1990s, from state monopoly to private ownership of the communications industry. The telecommunications network in Latin America is, however, more connected with the United States, Canada, and Europe than with points on the subcontinent or with Asia or Africa. Further compression of the time-space ratio began in the 1980s with the new telephone, fax, Internet, and cellular lines. The number of international telephone calls grew from 12.5 billion minutes in 1982 to 42.7 billion minutes in 1992 and 67.5 billion minutes in 1996. In 2006, 76 to 80 percent of the populations of Argentina and Chile population used the telephone; in the rest of the subcontinent, telephones were used by 51 to 75 percent of the population. As for Internet use, it varies from 11 to 30 percent of the subcontinent population, and the use of social networks—Facebook, Twitter, YouTube, and the like—is expanding rapidly and helping to link Latin Americans to the rest of the world. The spread of the new technologies at a reduced cost favored not just business and governments but also antiglobalization movements, as witnessed by the Zapatista Liberation Army of Chiapas, Mexico, which created a virtual worldwide net in support of its demands. The transition from the government-owned telecommunication companies of the 1970s to today’s multinational ones was eased by the 1997 international agreement on worldwide deregulation of the industry that was supported by the World Trade Organization (WTO). This change led to industry concentration: according to the United Nations Educational, Scientific and Cultural Organization, in 1989 thirty-nine of the eighty-one leading international companies were American, twenty-eight were Western European, eight were Japanese, five were Canadian, and one was Australian. The domination of the information market by large multinationals covers all media: printed news, television, radio, and the Internet. In this regard public opinion is shaped and spread worldwide based on global models with local adaptations. An appropriate term for this global localization might be glocalization. Thus the internationalization of public opinion has taken on 216

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a strong consumerist bent everywhere. Even the Latin American strata that only recently joined the market economy have rapidly embraced the consumerist model, even if their low income causes the poorest to be dissatisfied and the middle classes to have a strong tendency toward indebtedness. The march of globalization in Latin America began in the 1980s and is a result of the collapse of the bloc system and the victory of the United States over the Soviet Union. The collapse of the USSR, its sphere of influence, and its politicocultural model facilitated the spread of Western values. The media did their part by spreading the idea that the demise of the Soviet Union facilitated the birth of a unified world, while in reality the fall of the Berlin Wall unleashed a number of forces that hitherto had been strongly repressed. Among these were Europe and Japan, which were international economic powers but in the 1990s were still political dwarfs. The end of the Soviet Union allowed the European Union and Japan to claim a larger international presence, to the point of demanding U.N. reforms, especially in the Security Council. The federal nature of the European Commission and the European Council helps to strengthen multilateral orientations, which favor the weaker states, including Latin America. Multilateralism is a highly dynamic force that can renew the current “directoire,” which still consists of the winners of World War II. Among the more impressive results is the subsiding of the nuclear threat that had constituted the military foundation of U.S.-Soviet opposition. Starting at the end of the 1960s, with the thaw in Soviet-American relations, and despite their supposed monopoly of nuclear weaponry, the nuclear deterrent has spread to other nations. As of 2006, the nuclear club had twenty-one members; full-fledged members were the United States, Russia, Britain, France, China, Israel, India, Pakistan, and North Korea. South Africa, Libya, Belarus, Kazakhstan, Ukraine, Brazil, and Iraq had nuclear weapons programs but relinquished them. And Egypt, Iran, Japan, South Korea, and Taiwan were believed to have the ability to build nuclear weapons. While the nuclear power held by several Third World countries is a real threat, the Latin American countries used it as blackmail. In fact, both Brazil and Argentina accepted international oversight, then in 1991 agreed to eliminate atomic weapons (Argentina never actually built a nuclear bomb); however, they continued to build missiles. In 1991 Argentina inaugurated its Condor II program to build, in cooperation with Egypt and Iraq, and with the technical assistance of France, Germany, Italy, Sweden, and Switzerland, missiles with ranges from 150 to 1,000 km; two missile programs were underway in 2006 in Brazil. Also, as a result of Western technical assistance, Argenfrom disorder to diplomacy

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tina, Brazil, and Chile have become arms exporters; together with Cuba, they appear to support research on nuclear, biological, and chemical warfare. In the postatomic transition of the 1980s, the Latin American states took positions similar to those of Middle Eastern and Asian countries but without publicizing them. The growing autonomy of Latin America, like that of the North African Maghreb and the Middle East, depends on its position as the major strategic theater for the three industrialized powers: the United States, the European Union, and Japan. The rise of the European Union and Japan derived largely from the aid that the United States offered them to strengthen the alliance against the Soviet Union. By the end of the millennium the triad controlled much of the world’s technological, economic, and financial power and 80 percent of international trade. Since the end of World War II, the power of the United States has somewhat diminished, while Europe’s and Japan’s have greatly expanded. The commercial, political, and strategic tensions have moved from SovietAmerican opposition to disengagement within the triad, highlighting the new balance of power that is emerging. In building this new order, new seats of multilateral diplomacy have appeared that, like the enhanced cooperation through the United Nations, facilitate more participation by the weaker states. The new diplomacy is flexible and is both global and regional. Probably one of its first global manifestations was SWIFT, which bills itself as “the global provider of secure financial messaging systems,” created in the 1980s by agreement of the governments of the United States, Germany, and Japan. Unlike the United Nations, the new diplomacy tries to link economics and politics, such as the G-7 meetings begun in 1985 that bring together the most industrialized countries (United States, Canada, France, Great Britain, Japan, Germany, and Italy) and in the 1990s began to add post–Soviet Russia (G-8) and even more recently other industrialized nations, including some from Latin America (G-15). Another form of the new diplomacy that links economics and politics is the World Trade Organization, founded in 1995 by the signatories of the earlier General Agreement on Tariffs and Trade (GATT). The new diplomacy is “modular” in that only the countries with a direct interest in a particular issue participate. Resolutions are consensual and multilateral, guaranteeing their effectiveness. The new diplomacy probably takes into account the new international order in which power is more spread out—which means that the great powers can still play a central role in world government as long as they have the consensus of the other countries. The multilateral orientation of the new order allows the subcontinent to 218

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diversify and expand its international options, which had been partially strangled during the cold war by the U.S. economic and military presence and the Soviet Union’s lack of interest. In the new multipolar context the Latin American areas are important not only to the United States but also to the European Union and Japan. Latin America is reaping some benefits from the new order, including a high number of trade relations, such that it is securely part of world commerce. This explains the importance that the subcontinent attributes to the diversification of economic and political relations, which are sought both locally and in Europe and Asia. Latin America’s multilateral orientation is also the result of the search for an alternative to the shrinking of development aid from most industrialized nations and international organizations that began in the 1980s. This change spurred the subcontinent to open itself up to the international economy and compete with other Third World countries, especially those in Asia, to attract foreign investment, renew international loans, and gain more credibility with international bankers and European, American, and Japanese industrialists. By 2000 China already had a strong commercial presence in Latin America. In more recent years both the Chinese government and Chinese businesses were targeting the mining and oil industries, in partnerships with Latin American entrepreneurs. In recent years most subcontinent countries have adopted policies that run counter to radical nationalism as they open up to trade and finance. They chose the path of democratization precisely because they realized that they were being weakened by economic globalization and the multilateral trends that force states to delegate part of their autonomy, and because they were being weakened domestically by the multicultural and multiethnic groups that had been kept at bay by nationalist governments. As a result Latin America has built a rapprochement with both Europe and the United States that has brought about new forms of cooperation. These new forms of international cooperation integrate economic and political goals. Market integration is closely linked to the creation of democratic institutions that can overcome historical rivalries, favor a likeminded foreign policy, and offer security to the participating countries. This process moves toward building regional trade blocs and bodies that can gradually include all areas of the subcontinent. In recent decades several such entities have been formed; the most significant are the 1983 Contadora Group, which includes Mexico, Panama, Colombia, and Venezuela, to promote peace in Central America; the Contadora support group for Central America, comfrom disorder to diplomacy

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posed of Peru, Brazil, Argentina, and Uruguay (1985); the Rio de Janeiro Group, consisting of the eleven Contadora countries and the support group (1986); the bilateral Argentina-Brazil addition of 1986; the 1991 treaty to create Mercosur, the common market of the southern cone of Latin America, signed by Argentina, Brazil, Uruguay, and Paraguay; the North American Free Trade Agreement (NAFTA), signed in 1992 by the United States, Mexico, and Canada; the 1994 Group of Three, consisting of Colombia, Mexico, and Venezuela; and the Caribbean States Association, formed in 1994. In 1995 the American countries signed fifteen cooperation agreements that involved thirty countries, including one with the thirteen members of Caricom, the Caribbean Common Market. In 2004, sponsored by Venezuela and Bolivia, the Bolivarian Alternative for Our America’s People (Alternativa Bolivariana para los pueblos de Nuestra America) was born; this association, which promotes Latin America’s independence from U.S. influence, is expected to become in 2011 the Community of Latin American and Caribbean States (Comunidad de Estados Latinoamericanos y del Caribe). Other reformist initiatives are the Union of South American Nations (Unión de Naciones Suramericanas), formed in 2008 by Brazil, Argentina, Uruguay, and Chile, and the Andean Nations’ Community (Comunidad Andina de Naciones). These treaties and agreements point to a two-pronged strategy. The first prong was an attempt, starting in the 1980s, to shrink the power of the United States, which was reducing its development aid, and instead seek assistance from Europe and Japan, initiating a process of political cooperation and commercial blocs. The second, which began at the end of the 1990s, was to build new relations with the United States that would take into account the inequality of the two Americas to the benefit of the subcontinent. At the beginning of the new millennium seven countries—Bolivia, Chile, Colombia, Costa Rica, Ecuador, Honduras, and Mexico—signed new agreements with the United States. The U.S. proposal to carve out a free trade area in the Western Hemisphere, first enunciated in the early 1990s, is now fairly well received on the subcontinent. Provided that the new relationship is truly founded on the expansion of free trade, the preexisting, inherently asymmetrical, relationship would cease and the subcontinent would be free of the restrictions that had accompanied development aid. Once a new balance in the relations with the three great powers has been achieved, the Latin American countries could be free to become important players in the new international order. This new positioning, and the growing interaction with the great powers, had no negative effect on regional cooperation agreements that, unlike those 220

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of the 1960s and 1970s, were open-ended and could be coordinated with international ones. This two-point process could be hindered by two phenomena that are considered a threat to the new world order: the growth of Latin American emigration to the industrialized countries, the United States especially, and the spread of drugs. Although the first cannot be considered a real threat, since it fills a demand for labor, it could be negative insofar as it could lead to new forms of racism in the industrialized countries, though more in Europe than in North America. The same is true for the drug trade, which in the 1990s had reached an annual volume of $400 billion and, in 2007, of $1 trillion to $1.2 trillion. Thus, while in the 1990s the drug trade was six times the amount of total aid disbursed to the Third World, in 2007 it was double that amount, causing ongoing friction between producing and consuming countries. Only growth in international trade and a better economic performance by the Latin American countries can stop or mitigate this second source of anarchy in the international system. L at i n A m er ic a i n t h e I n t e r nat iona l Econom y

In this section I examine the relationship between Latin America and the international economy in commerce and finance, from the 1930s—the Depression era—to the dawn of the new millennium. These seventy-odd years have been portrayed as economically unstable—instability has indeed characterized the economy in this part of the world—with alternating cycles of expansion and recession, crises in the balance of payments, inflation and hyperinflation, budget deficits, and a rising foreign debt. Still, experts have underestimated the abilities of the economies of the subcontinent to become more resistant, especially since the 1980s, to external shocks, such as a lopsided balance of payments on the rates of exchange and thus on inflation. To understand the subcontinent’s economic transformation and, in particular, the role played by the international economy, I will discuss performance in the changing international economy and the obstacles that limited or negatively affected economic change in the short and medium term; finally, I will discuss what I believe is the leading obstacle to economic transformation: the gap between real economy and the financial system.

Populist Economics Seen in a broader context, the Latin American economy from the 1930s to the 1970s may be characterized as populist. This not very organized ensemble of policies focused on economic growth, measured in real per-capita income, L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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and income redistribution to foster social equality. Unfortunately, economic populism does not consider that these goals could be undermined by inflation, the deficits, isolation from international trade and finance, and protectionist and state-intervention policies that restrain, rather than regulate, market forces, with the result of discouraging economic activity. The premise of economic populism may be found in the messy international economy that, between the 1929 stock market crisis and World War II, wiped out the multilateral relations that had been built since the 1870s, when the gold standard was adopted. This situation obstructed the free circulation of capital and technology, opening the way to protectionism and exchangerate controls, a trend that would continue until the 1970s. In this period growing social expectations led to the belief that economic policies had no external restrictions, because the abundance of international capital and the exchange-rate control system created the conditions for beefing up the economy, increasing global demand, and improving real salaries and income redistribution. Economic populism is the product of a distorted rationality based on the idea that market forces are negative. Unlike socialist economies, however, populist ones cannot abolish the market and end up with alternating cycles of market denial and market acceptance. In other words, economic populism is not a long-lasting phenomenon but an alternation of cycles, each of short duration. By analyzing the history of economic populism from the 1930s to the 1970s, I have found that it is based on international instability. The populist cycle becomes activated whenever an economic stabilization phase fails. In this first phase economic policies reactivate production and increase real salaries and employment in a context of stable prices and stable rates of exchange. Increased public expenditure supports economic expansion, and the supply of foreign goods is supported by a negative balance of payments. In the second phase the economy moves toward a bottleneck caused by a strong rise in the demand for consumer goods and a reduction in the supply of hard currency. To unlock this stalemate the government increases the price of controlled goods, devalues the country’s currency, introduces currency-exchange controls, and raises protectionist barriers. The result is more inflation, a fall in real salaries, and an increased deficit. In the third phase goods become scarce, inflation accelerates, and there is a flight abroad of capital and a demonetization of the economy. The budget deficit grows as a result of a drop in revenues and an increase in government subsidies to basic commodities. Now the government tries to stabilize the 222

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economy by repeatedly reducing and devaluing currency. Real salaries keep falling, and the government’s policies become unstable. The final result is increased uncertainty and a general lack of trust. In the fourth and final phase of the populist cycle, the government falls, defeated at the elections or by a coup. The new government adopts a rigid stabilization policy that leads to a further fall in real salaries, whose purchasing power is now less than what it was before the populist cycle began. Public expenditures are severely cut, causing a further reduction in employment and in demand, but the capital that had been squirreled away abroad does not return. The outcome of the populist experience therefore is extremely negative. While it does not destroy the economy, it does penalize the very interest groups that should have benefited from it. It would seem that populist governments try to control the economy with regulating mechanisms that negatively affect the real economy and finance. Though the intention is to reactivate the economy through a redistribution of wealth, in the end the economy is returned to a level lower than it was at the beginning, thus nullifying the activity of the economic players. Since economic populism is not a constant phenomenon on the subcontinent, nor does it manifest itself with the same intensity in all countries, some economists have tried to identify its various forms. An early populism occurred in the early twentieth century in the more advanced economies of Argentina, Chile, and Uruguay; a classical populism developed in the 1930s and 1940s out of the international trade crisis, especially in Argentina, Brazil, Chile, Mexico, and Uruguay; and, finally, a late populism occurred in Argentina, Brazil, Chile, Peru, Venezuela, and Mexico from 1970 to 1990. The starting point of my analysis is the 1929 Wall Street crash, when the negative signals that had first surfaced in the early 1920s and had been reabsorbed after the rise in the price of primary commodities in the international market, something that had benefited all Latin American economies, became apparent. From 1928 to 1932 the prices of exported primary goods fell 64 percent, the volume of exported goods fell 22 percent, and the exchange rates became very negative. The plummeting of the economic indicators was not followed by a reduction in interest rates; as a result most Latin American economies experienced a fiscal crisis, with reduced revenues from exports and an increase in their foreign debt interest in real terms. The new direction of the Latin American economies was the result of both the 1929 crisis and the ensuing international chaos. These two phenomena are perceivable in the sharp fall in the GDP of Latin American countries between 1928 and 1935 and their weak revival during the Second World War. Latin L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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America was the non-European area most damaged by the international economic restructuring and the one most heavily hit by the world crisis. The revival was essentially dependent on the one-dimensional economy, whose dynamic strength lay in an expansion of the domestic market. The growth of consumption and of the number of consumers rested exclusively on more support to industries producing consumer and intermediate goods; their production increased to replace the goods that had previously been imported. Growth also depended on the definitive monetization of the rural areas, a result of agrarian reforms and the further settlement of wild territories. The revival, however, was hampered by shrinking exports, which limited the availability of the hard currency needed to import capital goods and raw materials. This in turn discouraged private investment, which meant there was no adoption of new technologies to manufacture export goods and for light industry. The pressing need to stabilize the economy, demanded by the urban middle and working classes, in effect slowed down the process begun at the end of the nineteenth century, to increase fixed assets in infrastructure and in agricultural and mining production. This standstill in the free circulation of the means of production inevitably plunged the economies into a protectionist spiral. Initially, increased import duties and an increased domestic market were justified as stopgap measures meant to support the domestic demand affected by the international crisis. But these policies quickly became part of the nationalist ideology, which, as I have discussed, dominated between the two world wars. The state took an active role in the economy, intervening directly in production and distribution and in the financial sector; this was done by creating public companies and nationalizing the leading mining and agricultural concerns, which until then had been privately owned. Although one could argue that protectionism and state interventionism were needed to confront emergency situations—first the international monetary crisis, then World War II—no one has conducted a study designed to explain why, after the new arrangements born at the 1944 Bretton Woods Conference, the Latin American economies did not adjust to the new system but instead intensified their nationalist and protectionist tendencies. One theory is that these measures were intended to be short- and mediumterm stabilization devices but in the end were put in the service of interest groups aligned with the government. The populist governments felt that by defending their “national” economy, they were protecting national sovereignty as well. According to left-wing populism, their sovereignty was threatened by the “imperialist” powers that wanted to seize the wealth of the popu224

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list governments; or, as right-wing populism would have it, their sovereignty was threatened by an “international Communism” intent on destroying their freedom. Nationalism was so strong that Washington’s new foreign policy toward Latin America—President Roosevelt’s “Good Neighbor” policy—in the end accepted protectionism and even encouraged it with loans to government and to the newly formed state-owned companies.

The Decades of Optimism One important trait of Latin American economic performance between 1945 and the 1970s was its alignment with the United States in a U.S.-dominated inter-American system. Despite strong hostility to such a preferential relationship with the United States, the Latin American countries were able to use the relationship to strengthen their economic interventions. In the late 1950s the economic presence of the state began to grow, not only in industry but also in infrastructure and services, cementing the close relationship between business and government that had existed since the 1930s. The new close relationship between business and government was manifest in the interests that linked the Latin American businesses—both state and privately owned—to foreign companies, U.S. especially, and in the exchanges between the various Latin American governments and the U.S. government. This closeness allowed both state-owned and private companies to secure loans and assistance from agencies and programs as diverse as the Export-Import Bank, the U.S. Treasury, the U.S. programs Food for Peace and Alliance for Progress, the World Bank, International Monetary Fund, U.S. Agency for International Development, Organization of American States, and the Inter-American Development Bank. Growth rates remained satisfactory well into the 1970s but began to decline in the 1980s. In fact, taking the demographic boom into account, per-capita GDP grew 2.5 percent a year from 1950 to 1973, while in the following period growth shrank to only 0.5 percent a year. For about thirty years the principal dynamic force in Latin American growth was industrial production: from 1940 to 1970 its percentage of the GDP grew quickly, especially in 1945–72, when it had the highest rates of growth. That period saw a significant gap between the growth in industrial production and the modest gains in GDP, while from 1972 to 1981 industrial production grew less than the GDP. In the 1960s industrial growth seemed to be the highway to the transformation of Latin America’s economy, but it failed to significantly affect the performance of allied sectors. Economic growth was unbalanced, as producL at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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tivity data reveal. The available data refer to the product per worker, which is an indirect assessment—a proxy, so to speak—for work productivity in the various industries. Although the available data are limited, they do show a large gap between industrial productivity and total productivity. In fact, total productivity was heavily affected by agricultural productivity, which remained low despite all the government-initiated changes, such as agrarian reforms and safeguards to private property, and the many subsidies, incentives, and loans received from a host of national and international development agencies. Notwithstanding these good intentions, the agrarian policies of that thirty-year period forgot that the main obstacle to productivity lay in the price controls on the main agricultural commodities, which, in addition to discouraging production, were also an indirect form of subsidy to the industrial workforce. In this period the main block to economic growth was the failure to turn the processing industry into an engine of modernization, because it was restricted to the narrow confines of each nation. In fact, this phase was called one of “inward growth,” highlighting its disregard for international commerce, for economists, politicians, and entrepreneurs believed that exposing a nation’s industry to international competition would kill it. Growth in industrial production as a percentage of the GDP corresponded to a decline in exports, thus inverting the factors without changing the results. In the final analysis economic interventionism blocked the export growth of agricultural, mining, and semifinished products: from 1945 to 1973 the percentage of industrial production in the GPD grew with some difficulty from 18 to 27 percent, whereas exports declined from 16 to 6 percent. Simply put, industrial expansion barely compensated for the reduction in exports; therefore the role of production in economic performance did not change substantially. Economic growth continued to depend on the extensive exploitation of natural resources and the use of unskilled or semiskilled labor. These conditions did not promote the creation of a new balance that could include more capital assets, a more skilled workforce, and better product quality. As strategies to industrialize and transform a country, interventionism and protectionism turned out to be very bad politics. At a time when the world economies became liberalized, moved to dismantle prewar protectionism, and embraced GATT, the leading Latin American economies went in the opposite direction and kept raising their import tariffs. During the 1960s in Latin America face-value protection exceeded 200 percent for consumer goods, was 100 percent for durable consumer goods, 40 percent for semifinished products, 50 percent for raw materials, and 50 percent for investment 226

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assets. In the European Economic Community face-value protection did not exceed 19 percent, with an average of just 13 percent. This comparison gives the impression—from data about fixed assets and raw materials—that in the end protectionism prevented the adoption of new technologies that could have promoted the transition from import substitution industrialization to a competitive industry for both the domestic and the international markets. But protectionism and interventionism did something worse: they intensified the separation of the domestic and international markets. In fact, the national pricing system had little connection to foreign prices because the prices controlled by the government did not follow international trends. This gap is obvious in the prices of agricultural products, which were kept much lower than foreign prices to keep food prices affordable and to aid the farming industry. Another significant price distortion was in foreign exchange controls, which overvalued national currencies against the strong currency, the dollar. The negative effects of price distortion caused inflation to start to rise rapidly in the 1960s, especially in the more “closed” economies of Argentina, Brazil, and Chile; inflation also had a negative impact on the balance of payments, forcing all Latin American countries to sign agreements with the IMF; finally, the treasury was compromised by the increase in government subsidies. In fact, although tax increases hit the lower-income urban classes especially hard, the deficits of Latin American countries ballooned from 4.8 to 6.3 percent of GDP between 1950 and 1960, and from 6.3 to 8.5 percent of GDP from 1960 to 1970. In conclusion Latin American protectionism simply caused a concentration of investments in sectors that promoted the political interests of the various governments, which led to a process of economic repression with negative social effects. My theory is that import substitution industrialization was an informal strategy of the ruling classes to facilitate the transfer of their agrarian and financial capital to more profitable industrial investments and that populist governments encouraged this transition in exchange for the support of the elites. In this historical phase the Latin American entrepreneurs allied themselves with the protectionists and the nationalists, that is, with antimarket and anticonsumer forces.

New Economic Imbalances It would be superficial to claim that the populist economic policies were meant to support only strong, long-time economic interests on the subcontinent; in fact, many economic decisions that would have long-range L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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negative effects derived from the need to confront the social and political threats brought on by the population boom and the need to guarantee higher incomes and a social safety net to the middle and lower classes, especially starting in the 1960s. The social threat arose from the population growth: from 1950 to 1970 the working-age population increased from 50.5 to 86.1 million. As a result unemployment and underemployment increased dramatically, to 30.4 percent of the working-age population in 1968. According to the International Labor Organization’s Latin American office, the percentage of workers employed in the underground urban economy rose 32.2 percent from 1950 to 1970, growing from 8.7 to 11.5 percent of the workforce. These figures show that job opportunities became increasingly restricted, despite the redistributive policies enacted by the populist governments. The need to meet social demands drove the governments to increase public expenditures for education, health, pensions, and unemployment benefits— the last expanded rapidly in the 1950s and accelerated in the 1960s. The available data show a close relationship between the growth in social expenditures and budget deficits. In 1950–70 deficits increased 6.5 percent, from 30 to 36.5 percent of total revenue for the leading economies of Argentina, Chile, Colombia, Mexico, Peru, and Venezuela. Still, the increased taxation could not cover the higher welfare and investment expenses in a period when the governments were committed to expanding public expenditures to support investments. This policy was affected by the drop in private domestic investment and the low growth of direct foreign investment in 1960–70, both caused by the fears of American and European investors regarding the new populist policies. The monetary liberalization that occurred from 1950 to 1980, made possible by the new currency-exchange system that followed the Bretton Woods agreements, freed a large supply of international capital, enough of which flowed to the Latin American economies to minimize the obstacles these countries faced. The increase in international reserves and liquidity first appeared in the 1950s; now the industrialized countries’ currencies were perfectly convertible, and the rest of the world was willing to use dollars as reserve currency, as an international reserve, and as an exchange currency. Latin America benefited from the new international liquidity, although in order to participate in the Bretton Woods system countries of the subcontinent were obligated to have a balance of payments. In fact, the IMF, one of the entities born from the 1944 agreements, was in charge of keeping exchange rates stable and solving balance-of-payment issues. 228

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For Latin America acceptance of the new payment system meant that the countries had to set a parity value in gold or dollars for their currency; they could modify that value only to correct imbalances in payments; temporary variations would be compensated by that country’s reserves, supplemented if necessary by withdrawals from IMF reserves, which are funded by “quotas” based on the size of each member country’s economy. The Latin American states, like the other members, had additional withdrawal rights, subject to restrictions that obligated the recipient state to accept a stabilization program in order to arrive at a “realistic” rate of exchange. The stabilization programs that would so irritate Latin American public opinion called for higher taxes and smaller budgets. A new component in the international flow of capital that greatly benefited the subcontinent was official aid. This new form of international capital was based on the idea, accepted by almost all industrialized nations, that many countries—especially the “underdeveloped” ones—needed a certain volume of imports to support increased production. It was believed that exports in general are not affected by internal factors and are wholly dependent on foreign demand, which grows at a different rate than the one planned by national production. Thus it was possible that imports could exceed exports, causing a gap that had to be filled with foreign aid. In the long run this gap would lead to a rate of savings that was too high and a rate of investment that was too low, but a rise in savings would neither lead to increased investments nor affect the purchase of imported goods. The result was that without official aid, filling the commercial or investment gap would be impossible and national production would languish or shrink as a result. Because the underdeveloped countries, Europe, and the United States all shared this belief, receiving official aid became a milestone in the growth of the Latin American countries. Abroad, this arrangement promoted the belief that national economic policies were rigid, that is, that a country could not replace the goods it was importing, especially capital goods, with domestic products and that the protectionist policies of the Latin American countries were inevitable. Actually, these countries benefited greatly from the new international liquidity made possible by the Bretton Woods agreements. In the 1950s direct investments resumed after a twenty-year hiatus. Unlike the earlier capital, the investments made between 1950 and the 1970s came primarily from the United States and drove technological innovations in the oil industry, the manufacture of semifinished goods, and the capital and financial brokering sector. Between 1950 and 1970 American investments grew from $4.5 to L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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$12.9 billion, mostly in the sectors where productivity also grew as a result of the increased fixed assets per employed worker. However, direct investment grew much more slowly than official aid—loans by the governments and agencies of industrialized countries and by international agencies. Although these loans were somewhat limited until the mid1960s, they allowed the Latin American countries to make necessary public investments to support agriculture and expand public services. Starting in 1966, and especially after 1973, more capital was available to them as a result of the greater European and Japanese presence and the rise in the price of oil. In the 1970s the average yearly loan flow was five times greater than direct investment. The result of this change was that Latin American economic growth in 1970–85 was driven by the huge availability of money made possible initially by the liquidity of the oil-producing countries. That money was augmented by funds from the new credit institutes such as the Inter-American Development Bank and the new aid programs such as Alliance for Progress. The ease with which the Latin American countries became indebted from 1960 to 1980 owed not only to the supply of capital but also to the interest rates, which were negative in real terms for the borrowing countries throughout the 1970s. As a result incurring debt was a logical choice for the subcontinent and other emerging economies, since it allowed these countries to remedy the lack of services for a population that was growing by 3 percent yearly. The economic reality is very different from the vision offered by the international organizations and the governments of both industrialized and Third World countries, because, as a result of the extraordinary abundance of capital at very low interest, the Latin American governments were able to raise investment in public and social services and in urban infrastructures, which in turn encouraged foreign investment in industry and mining. Thus total investment increased from 16 to 18 percent of the GDP in the 1960s to 22 to 24 percent of GDP in the 1970s. The abundance of international capital allowed domestic savings to expand, an expansion that was to last even after the reduction in public investment that began in 1982. Despite the immediate benefits that accrued from the new public and private investment programs, in 1974–77 investors began to move capital out of Latin America. In 1982–89 the net transfers of capital became highly negative. From all this information it is possible to deduce that the alternating growth and stagnation that characterized the 1980s was derived from a fallacious assumption of populist economics: that shortcuts to economic well-being exist. Because the governments had been the major players in the economic 230

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growth of the 1960s and 1970s, they deluded themselves that they could escape the balance-of-payments strictures by securing new loans, without considering that the Bretton Woods parities had ended in 1973 and that the large amounts of capital at low interest were not a permanent reality but only a temporary one. The statism that characterized Latin American economic policy in these years also forgot that public investment, especially when financed by foreign loans, involved an economic cost. Sooner or later the state would be forced, as in fact happened, to unload the cost on taxpayers and later transfer to private companies the ownership and management not only of state-owned enterprises but also of state-owned assets that are inalienable since they belong to the people; such was the case for a large part of elementary and middle schools and of colleges and universities. Analysis of the data about the indebtedness process of the major Latin American economies makes clear that contemporaneous with the abnormal growth in public debt was an important change in the source of the loans: they were no longer disbursed only by governments and international organizations but also came from the private international financial system. The result of this shift was that now the debt was no longer simply confined to governments and state agencies that borrowed from foreign governments and international agencies; private businesses also found it easier to get financing from international banks in U.S. dollars. The shift from capital borrowed from official sources to that borrowed from private banks favored the multilateralization of the debt, with loans underwritten by financial institutions of industrialized countries. However, it also made the Latin American economies overly reliant on exchange rates. This international fragility is visible in the increased number of variable-rate loans in 1970–72 and 1980–82. The financial crisis that would grip Latin America in the 1980s, causing economic stagnation and confusion, could have been foreseen if the Latin American economists and politicians had not been beholden to populist ideologies and if the American and European bankers and financiers had not surrendered to the siren song of the so-called economy of underdevelopment.

New Performance and Productivity Trends To draw the economic picture of the subcontinent, I have used two broad macroeconomic aggregates: total per-capita GDP and total-factor productivity. Except for the 1980s, the growth rates had a respectable performance from 1970 to 2000. More important, in both the 1970s and 1980s the growth rate L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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for the entire subcontinent was not only in line with the historical mean for the period but was even higher than that of industrialized Western Europe and the United States. Nevertheless, Latin American growth was visibly lower than that of the emerging Asian economies. The positive image suggested by the growth of the Latin American GDP requires reassessment in light of the per-capita GDP. Unlike the per-capita GDP of other parts of the world, that in Latin America continued to deteriorate in the medium term despite the marked increase in 1950–73. Probably only in the 2010s will the per-capita GDP reach the level of the 1950s. Undoubtedly, the worsening quality of life in Latin America and the opposite trend in Europe were directly related to their respective rates of demographic growth. Although in Latin America population growth slowed in 1973–80 and 1989–94, from 2.4 to 1.8 percent a year, it still remained higher than the worldwide average, which was 0.6 percent for 1973–80 and 0.8 percent for 1989–94. The subcontinent’s population growth today remains higher than that of Asia, Europe, and North America, for regions that were settled only lightly in the early twentieth century are now densely populated, even supplying emigrant labor to both the United States and Europe. The strong population growth affected and continues to affect the gap between total GDP and per-capita GDP; analyzing the evolution of productivity as presented by A. H. Hofman (table 1) makes it possible to better understand the effects of the demographic boom. Interpreting Hofman’s total factor productivity (TFP) estimates is not simple, although they are the most complete because they take into account both the various factors of production (natural resources, labor, and capital) and the qualitative effect of the various productive inputs. In my opinion total factor productivity is lower in Latin America than in other parts of the world, now as in the past. Only in 1989–94, probably as a result of the greater inclusion of the subcontinent in the international economy, did total factor productivity become aligned with that of other parts of the world. Nevertheless, a comparison of the TFP of the emerging Asian economies and that of Latin America shows that the latter’s is much lower. I must also stress that in Latin America positive periods for TFP alternate with negative ones, while in the other parts of the world the trend is linear. Both productivity and the per-capita GDP alternate periods of expansion and contraction, so this is a structural feature of Latin American economies not found elsewhere. This alternation suggests that the macroeconomic instability reported by many scholars can be better understood by analyzing the limitations inherent in certain factors of production. These limita232

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Ta bl e 1 Average Annual Productivity in Different Areas of the World, 1950–1994 (Total Factor Productivity [TFP, or percentage of GDP] is given in parentheses)

Country Latin America Asia Spain and Portugal Industrialized nations

1950–1973

1973 –1980

1980–1989

1989–1994

2.5 (46) 4.4 (52) 4.1 (71) 3.5 (66)

1.1 (23) 4.6 (21) 1.1 (41) 1.0 (45)

–0.9 (–60) 3.9 (48) 1.3 (48) 1.3 (50)

1.8 (45) 3.4 (50) 0.8 (44) 1.1 (61)

Source: A. H. Hofman, The Economic Development of Latin America in the Twentieth Century (Cheltenham, U.K., 1999), 117.

tions would also explain the relative backwardness of Latin America on the world market. In fact, total factor productivity shows that the gap between Latin America and the developed economies is the result both of obsolete machinery and the lack of workplace organization, with the result that Latin American goods cannot compete internationally, because they are of lower quality and are inefficiently marketed. Although this inability to compete owes in part to poor craftsmanship, the Latin American countries did make large investments in public education after the 1950s, and they were large even in light of the 1950–1980s boom, when the population growth rate almost doubled, from 2.1 to 3.7 percent per year. Between 1950 and 1990 average years of schooling grew from 2.4 to 5.5 for elementary school, from 0.4 to 2.2 for middle school, and from 0.04 to 0.5 for secondary schooling in the largest countries. This educational effort was particularly intense in Argentina, Brazil, Chile, Colombia, Mexico, and Venezuela. I believe that the failure to use new technologies to make Latin American goods more competitive was not the result of a lack of skilled labor but rather of government and corporate policies that were too focused on putting as many people to work as possible. The persistence of a business model based on poorly paid unskilled labor and little or no new technologies is responsible for a total factor productivity lower than that of industrialized countries and even lower than that of emerging Asian countries; total factor productivity for Latin American countries stagnated in 1973–80 and declined in the 1980s. Modern history teaches that in general relatively backward economies will experience, over time, substantial increases in productivity. In this sense the Latin American experience is an L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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exception, because of the persistence, both in public policy and in corporate culture, of the traditional idea that production must be planned around the extensive exploitation of natural resources and of labor instead of fixed assets. In Mexico in the 1990s small factories had a productivity that was 69 percent higher than the industry average, whereas productivity in the large, privately owned domestic companies was only 20 percent higher than the industry average, and foreign companies with international production standards had a productivity rate 78 percent higher than the average. Based on these statistics, it appears that Latin American industry, already hampered by its reluctance to adopt new technologies, was also characterized by large differences in productivity even among companies of similar size in the same sector. Most likely, this anomalous trend was negatively conditioned by the weakness of market reforms, failure to strengthen property rights, and insufficient availability of know-how. In most Latin American countries, in fact, the property rights of small owners and entrepreneurs are still not adequately safeguarded, for several reasons: the lack of interest of the ruling classes, mediocre administration of justice, and persistence of forms of common ownership that cause bottlenecks in the marketing of technology and machinery. In addition to constricting the market, these limitations negatively affect the transition from production that is labor intensive to production that makes the highest and best use of technology.

Savings and Investments If we accept the idea that economic prospects can be hurt by an insufficient modernization of industrial technology and processes, it is logical to think that the economic backwardness of Latin America is rooted in its failure to modernize its industrial system. Latin American industry developed at the turn of the twentieth century and was geared to exploit domestic raw materials and a large unskilled labor force, not advanced equipment and machinery. This observation contrasts with the dominant trend in economic studies, which holds that Latin America’s delay in economic development occurred from the end of the 1960s to the 1990s and was caused by the negative international economic situation, especially Latin America’s high foreign debt and insufficient reforms in banking and finance, as well as in private and intellectual property legislation. The dominant interpretation focuses on the performance of the real economy without investigating, as I think scholars should, the failure to modernize technology and processes. It is not fair to simply state that the weakness of Latin America’s economy owed to the per234

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sistence of populist elements: one must determine whether the main obstacle to an industrial modernization that puts fixed assets first is a pervasive resistance by the government and by society to a market economy. I believe it is no accident that governments, political parties, and associations all claim that a market economy requires a stronger democracy, which they say is difficult to achieve in Latin America, given the low family income level and the large percentage of people living below the poverty level. Latin American governments have insisted that the main obstacle to embracing a market economy is the relative poverty of their populations, but this is based on highly incomplete evidence. The information about income distribution is only partially reliable for the urban areas and does not usually include the different strategies to which families resort to supplement their income. That urban unemployment held steady at 8 percent in the 1990s and into early 2000 does not necessarily mean that the number of poor increased. From 1976 to 1992 the regression in urban income distribution in Buenos Aires, Santiago de Chile, Montevideo, Mexico City, Bogotá, and Quito was mainly caused by the liberalization of the labor market, the assumption of bank debt by the governments, and the failure to improve public services; in other words, the deterioration in the quality of life was not linear because it mounted when so-called democratic governments enacted regressive social policies and were incapable of controlling poverty. My impression is that the failure to build a market economy, which is the key to Latin American economic transformation, is essentially based on the inability to accelerate the insertion of capital and technology in the production processes. The new historical reports of the U.N. Economic Commission for Latin America (UNECLA) note that capital investment grew from the end of World War II to the 1950s, when it reached 20 percent of GDP. From 1950 until 1968 capital investments were reduced to 17.8 percent of GDP, then grew again from 1966 to 1980, when they reached 24 percent of GDP; then there was a long slump from 1980 to 1997 that continues to this day. In the 1990s the absorption of new capital was less than what it had been in the 1970s, and only in 1994–95 did foreign investment return to the level seen in the 1970s. Nevertheless, the participation of foreign capital in total investment was still quite small in 2005—less than 4 percent of GDP—while domestic capital—originating from domestic savings—increased significantly, especially in 1995–2004. In truth, the percentage of foreign capital in total investment was even lower if we consider that the net capital transferred abroad was about 1 percent of GDP in the 1990s. Because the main source of investment was domestic capital, it is necessary L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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to try to understand which mechanisms prevented savings from having the influence it had in the 1970s when savings constituted 21.1 percent of GDP. Underwriting industrial modernization by investing more private savings and corporate capital is less likely to occur if individuals cannot increase their income, thereby becoming consumers. In most Latin American countries, one third of the population (not counting the very poor) did not see its income increase. At the same time high-earning individuals and businesses saw their savings and profits skyrocket, but since they could invest in the international financial market, some capital probably left the home country. And, in fact, the partial information available confirms that during the so-called lost decade, the 1980s, the flight of capital was impressive. This was due to investments in foreign markets, but also to a negative trade balance. From 1976 to 1987 the annual flight of capital increased from $29.1 to $100.1 billion in Mexico; from $20.9 to $53.4 billion in Argentina; from $18.1 to $53.1 billion in Venezuela, and from $600 million to $35.7 billion in Brazil. Thus, in contrast to the dominant interpretation, it seems that in the 1980s the creation of capital accelerated, but only part of it was invested domestically, and an amount equal to 1 to 3 percent of GDP was exported. Therefore the increase in absolute and relative poverty depended less on a supposed slowing down of capital gains than on the flight of capital, which resulted in excessive foreign debt, with the result that a sizable part of amortization and interest was paid by lower-income classes through inflation and new indirect taxes. Also, the slow process of overcoming statism and populist policies drove high-income earners and companies away from investing at home and toward exporting their income and profits to financial centers that would better protect their money. In the 1990s the Latin American government policies to encourage investment were hindered by the crisis in international aid, one of the principal sources of state investment before the 1980s. The result was a slump, then a drastic reduction, in state investments, both in state-owned companies and in public services, especially starting in 1982. In fact, state investment rates were negative from 1982 to 1988. Very probably, all the policies that were implemented in the 1980s to reduce the government’s participation in the economy can be explained not so much by a real desire to privatize state holdings as by the decades of waste, followed by the fiscal crisis characterized by budget deficits, a stricter tax policy, and losses in the state-owned companies. Although the fiscal crisis originated in the last populist wave of the 1970s, it exploded in the 1980s, forcing the governments to cut their budgets and social services and to increase fees for the use of public services. Even today, 236

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revenues and expenditures are still not in balance, although legislation was somewhat successful at reducing public expenditures to about 5.6 percent of GDP from 1984 to 1994. The stricter taxation policies and plans to balance the budget probably have strengthened Latin America’s participation in the international economy, promoted the reduction of customs duties, and improved tax collection. Still, these new directions are threatened by protectionist drives, by the new Venezuelan, Ecuadoran, and Bolivian populism, and, more generally, by an economic philosophy hostile to market forces. One main argument of the antiglobalization groups criticizes the privatization policies enacted. In fact, all the fiscal maneuvers and restructuring of production processes essentially resulted from the privatization of state companies. In 1974 Chile was the first country to privatize its vast stateowned assets, which included banks and industrial companies. In the 1980s the privatization process extended to the entire subcontinent and reached its apex in the 1990s; it continues today in some countries. Privatization was accomplished by transferring to private entrepreneurs, at home and abroad, assets that had been owned and managed directly by the governments, including strategic national resources such as oil and gas, the petrochemical industry, agribusiness, and mines; infrastructures such as ports and highways; public utilities such as telecommunications, power, and water; manufacturing companies; financial services; and transportation services such as airlines and railroads. The large profits that accrued to the state from privatization could have been invested in industrial modernization and social services to reduce social inequality. Ideally, the privatization process should have respected the rules that should theoretically govern even government activity in the market: equal opportunity to potential buyers, transparency of the bidding process, and disclosure and using the profits to improve services for the public at large and to support fixed capital investments in industry. Had all these conditions been met, privatization would have made a significant contribution to reducing the prices of consumer goods and services and supporting a market economy. From 1990 to 1995 state-owned companies worth $60 billion were privatized. This transfer was particularly intense in Mexico, Argentina, Chile, Venezuela, and Peru. Given that in the same time period the proceeds from the sales were almost equal to the total inflow of direct foreign investment, it is safe to say that the cash inflow to the government was massive. The available data are few but clearly show nonetheless that the governments received about $14 billion from abroad for the purchase of stateowned companies. This confirms the theory that a large part of the capital L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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was domestic capital that was invested elsewhere in the 1980s and was now returning home.

A Fragile Financial System The fragility of Latin America’s financial system is due, in part, to the speculative nature of the privatization process, which was targeted at realizing high short-term profits and was supported by the reentry of domestic and foreign capital. The fragility is also detectable in the volatility of the financial market during the crises of the 1980s and 1990s, characterized by intense boom and panic cycles with capital flows that tended to increase enormously, then contract precipitously. Another fragile aspect was the informational confusion, that is, the market’s inability to differentiate between different types of investors, with the seesaw result of optimistic phases of high liquidity alternating with pessimist cycles when the markets would lose faith in the information released by governments and corporations and subsequently would experience disarray and a strong contraction of liquidity. While it is generally believed that financial fragility is related to the flow of foreign capital or, at any rate, of capital coming from abroad, I believe that the changes of the 1990s were insufficient to establish a network that on one hand could link domestic savings to investment processes and, on the other, overhaul the old-boy financing that hindered the free access of all economic players to the capital market. The difficult relationship of international and Latin American financial markets was rooted in the enormous amounts that could enter and leave the Latin American markets after deregulation freed investors to exchange domestic assets for foreign ones much more easily and quickly than in the past. Thus every time U.S. interest rates dropped, enormous volumes of international financial capital flocked to the emerging markets, Latin America’s in particular, in search of higher yields, but when U.S. rates went up, enormous volumes of capital reentered the United States and Europe, generating the boom-and-bust cycles. This seesaw was one of the main reasons for the financial crises that hit Mexico in 1994, Brazil in 1999, and Argentina in 2000, crises unleashed by economic, financial, and political indicators that worried investors, causing capital to flee the Latin American markets. In all probability the fragility also stems from domestic policies that, although improved since the 1990s, have not yet found a way to allow financial markets, now more vulnerable to foreign stimuli than in the past, to convert into new sources of industrial investment. In fact, without a better link between finance and industry, the capital market will always be subject 238

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to boom-and-bust cycles. Although some economists suggest restricting the flows of capital precisely to avoid excessive volatility, more adequate policies should be designed for the medium and long term and discourage speculative financing while encouraging long-term and direct investment. To this end the Latin American governments could reduce volatility by extending the maturity date of state bonds, increasing the liquidity requirements, requiring a ratio of capital to savings, and, finally, winning the financial institutions’ commitment to assume the role of last-resort lenders, in order to reduce the risk of capital flight. Undoubtedly, greater cooperation between government policy makers and the barons of international finance could enable the Latin American stock exchanges to transform speculative capital into direct financial investment. It was not a coincidence that ten years after the inauguration of the stock exchanges, the volume of transactions was still limited. In 1998 daily transactions totaled $7 million in Santiago de Chile, $26.7 million in Buenos Aires, $81.7 million in Mexico City, and $351 million in São Paulo. The failure to fully exploit the massive increases in the volume of capital flows between the developed markets and the emerging Latin American markets is to be blamed not on the international situation, as experts insist, but on the meager progress and unchanged fragility that still characterize the financial systems of each subcontinent country. In fact, banks and savings and loan associations are the only institutions where family savings are deposited. Only in Chile and, since the late 1990s, in Mexico are retirement funds beginning to account for an important share of institutional savings. The result is that while bank savings in 2000 constituted more than half of the GDP in industrialized countries, they were no more than 32 to 35 percent of GDP in Mexico, Brazil, Venezuela, and Chile, and only 15 percent of GDP in Argentina and Peru, where the small depositor still feels more threatened and prefers to keep savings in dollars and local currency. The main reason for the low percentage of institutional savings was the low interest rates that, in the best of cases, such as Colombia and Chile, never exceeded 3 percent a year and was highly negative in Mexico, Argentina, and Peru from 1980 to 1994. The reasons for this situation lay in the weak regulatory framework and backward state of banking practices, the impossibility of banks’ recovery of loans that debtors fail to repay, and the recurring monetary devaluations. The result was that the small depositor preferred to keep savings in short-term deposits and the banks in turn found it more profitable to grant short-term credit, which promotes consumption but not production. In the 1990s the banks found that credit cards, which are a form L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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of consumer credit, are an excellent business because the interest rates they can charge are three to five times the rate of inflation. The difficulty in transforming the Latin American financial system into a modern one capable of supporting the real economy and reducing the boomand-bust cycles is not, as many believe, a recent phenomenon. It originated in the statist policies of the 1930s and 1940s when the creation of a state sector—the establishment of state-owned industrial, commercial, and financial companies—in the various countries increasingly translated into the appropriation of individual, family, and corporate savings through negative real interest and/or devaluations caused by budget deficits. The ungluing of the real economy from the financial system expanded from 1940 to 1980 when statist and populist economic policies dominated; in these years the flight of capital to foreign countries was large and savings were frozen as depositors purchased reserve currency and stored it in safety deposit boxes. Small and medium-sized savings accounts abroad proliferated, especially after 1960, and in part accounted for the expansion of financial centers in Florida, Texas, and California. The growth of deposits abroad not only reduced the availability of capital at home but also contributed to higher real interest rates in the small Latin American economies. Therefore, small and medium-sized businesses increasingly relied on self-financing for expansion projects, while the large corporations benefited from facilitated state loans with interest rates lower than the rate of inflation or were able to obtain credit abroad, thus contributing to the increase in private foreign debt. In conclusion the strained relationship of industry and finance is not foreign made but home grown. Still, the dysfunction is more clearly visible from the outside, because international financial institutions, especially in the period from 1940 to 1980, offered more and better information and statistics than domestic banks, at least until the 1970s, when the Latin American central banks began to be more forthcoming. Hasty, often haphazard, economic policies and an inadequate management of resources, especially during the recurring waves of populism in the 1960s and 1970s, translated into ballooning state and private foreign debt. Undoubtedly, the latter also contributed to the higher international rate of inflation that began in 1973. In the final analysis it is fair to say that in addition to the strain between industry and finance, the main phenomenon that marked the Latin American economies between 1940 and 1980 was, following Heller and Starrett’s theory, a true failure of the market, that is, the persistent and dominant presence of noncompetitive market forms. If we add to this failure the decreasing yield caused by fixed transaction 240

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costs, lack of sufficient disclosure to prospective investors, and difficulty in defining the rights of ownership of agricultural land and vital commodities, we can also say that the strain between industry and finance was the major factor responsible for the backward state of the Latin American economy. More generally, starting in the 1960s a number of mechanisms appeared that were designed to repress market forces, such as statist economic policies, foreign-trade protectionism, onerous policies to support an inefficient industry, and finally, a repressive control of credit and currency exchange activities. Financially, the competition-stifling mechanisms are clear in the relationship of bank credit and the agricultural, industrial, and commercial sectors. In the early 1970s UNECLA estimated that state and private credit financed about 26 percent of manufacturing and commercial activity in Mexico; in Brazil the figure was 24 percent; in Peru 17 percent; and in Venezuela 12 percent. However, in Brazil, and perhaps in other countries as well, more than half the bank credit was disbursed by state-owned banks that, as I noted earlier, subsidized industrial production almost exclusively at favorable terms. The failure of the market economy is clear in the delayed start of stock exchange activity. At the end of the 1960s the volume of transactions in the Latin American stock exchanges was still low. Transactions on the São Paulo and Rio de Janeiro markets amounted to only 0.8 percent of Brazil’s GDP. The only stock exchange with new physical capital was Mexico City’s; there transactions represented 10 percent of Mexico’s GDP in the early 1970s, but even these declined during the populist governments of Luis Echeverría Alvarez and José López Portillo. All in all, one could argue that the Latin American financial system is still barely able to control the industrial sector and that the excessive amount of industrial financing on favorable terms created a system that was not conducive to developing a true capital market coordinated with the international markets. Worldwide inflation in 1973–82, at an average annual rate of 9.6 percent in the sixteen most industrialized countries, helped to transform the relationship of industry and finance. In Latin America preexisting inflation, fueled by recurring populist episodes when the governments greatly expanded public expenditures without an adequate increase in tax revenue, ballooned into a hyperinflation that totally unhinged the old statist economic parameters. This was especially the case for Argentina, Brazil, Bolivia, Chile, and Peru. In my opinion the phenomenon of hyperinflation proved that a country’s entire economic policy has to be in step with the prevailing international economy: the distinguishing traits of the subcontinent’s economy, from L at i n A m e r i c a i n t h e I n t e r n at i o n a l E c o n o m y

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Bretton Woods forward, were isolationism and protectionism, because until the 1970s the main, and almost exclusive, link with the rest of the world was the United States. During the 1980s, once this trend played itself out, expanded international commerce fueled significant change. From 1973 to 1992 Latin American exports grew 5.1 percent a year, 1.5 percent higher than in the 1950–73 protectionist phase and almost 2 percent higher than the international average. However, Latin American economists were more interested in economic performance, which was relatively negative for the subcontinent, than in the expansion of trade, and failed to notice the positive effect the expansion of trade had on economic policy overall. In fact, foreign trade, both exports and imports, is the only variable that continued to grow even during the 1982 and 1986 crises. A more careful historical reconstruction of the 1980s might suggest that the growth of foreign trade led Latin Americans to perceive that globalization could be useful and that to fully grasp its benefits they should redefine their economic policies, especially in the international context. Even Mexico, reversing its diplomatic tradition of bloc neutrality, signed the GATT agreement immediately after the 1985–86 economic crisis. This means that the new policies began to take shape almost out of necessity, although the governments by and large continued to lean toward a protectionist discourse. Expansion of foreign trade thus became the dynamic variable of Latin American performance from the end of the 1970s to the early 1990s. The growth occurred only in a few sectors, however, and was limited geographically. Still, it allowed the subcontinent to seize the opportunities offered by the progressive reduction of international inflation and to start a process of economic stabilization that translated, first, into lower budget deficits and less public investment. In sum, thanks to expanded foreign trade, reduction of the deficit, and the large reduction in public investment, the mechanisms that stifled market forces began to disappear. It was not by chance that at the end of the 1980s, various governments became aware of the need to reform the financial system, hoping to speed the accumulation of savings in order to expand the capital market. It would be reasonable to say that, by forcing the process somewhat, the state’s withdrawal from industry tended to accelerate the growth of the financial system. The case of Mexico from 1989 to 1995 is a good illustration of the expansion of the financial system that in this case was indirectly encouraged by the government and by international financial institutions. Financial instruments, measured on the basis of the private sector’s total liquidity, show a rate 242

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of growth of 19 percent a year; in just seven years financial instruments went from 40 to 56 percent of the GDP; in the same period transactions on the Mexico City stock exchange grew from 1.2 trillion to 13 trillion pesos. To really understand the transformations that took place and are still taking place in the Latin American economies, it is necessary to look more carefully at the trends in financial variables, because industrializing their economies surely depends on the ability of domestic and international players to expand the financial sphere by creating innovative forms of interaction between the Latin American financial markets and those of the leading economic powers. Therefore, in the early 2000s the subcontinent finds itself, as it did at the end of the nineteenth century, on the threshold of a new economic trajectory. Let us hope that the knowledge accumulated in recent decades will not be lost and that the mistakes of one hundred years ago will not be repeated. If it is indeed possible to learn from past mistakes, I would like to close this chapter by recalling the obstacle that could not be overcome a century ago: creation of new institutions that could regulate the economy without opening the way to state intervention. In the early 2000s economic institutions are still weak, and a philosophy hostile to liberalizing market forces still prevails. They are the main blocks to the full establishment of a market economy that can guarantee a new phase of growth compatible with a fair distribution of wealth and services, in which both the state and the market should participate. T h e Secu l a r i z at ion of Soci et y

In the nineteenth century Euro-American society had organized itself into economic classes, leaving behind the notable-based hegemony that had risen at the end of Iberian colonialism. As had been the case for Europe, the new society on the subcontinent gave birth to what until then had only been speculated about: the category of the individual who possessed rights and duties. In the twentieth century the right to act and organize freely entered the social dynamic and became part of the fabric of everyday life. The growing individualism reached all corners of society, loosening tradition and opening the door to new lifestyles that can reconcile the interest of the individual with the common good. The studies of new forms of socialization in the twentieth century are useful in understanding the different types of conflict between individual and collective interest on the subcontinent. Despite the beliefs of earlier scholars, T h e S e c u l a r i z at i o n o f S o c i e t y

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at the end of the nineteenth century forms of rebellion in defense of traditional rights to own land and water, and natural resources in general, and against new taxes, began to crumble. Dissent, including its violent forms, became directed at demands about salaries, education, public health, and, more generally, economic, social, and political rights that could both satisfy personal needs and bind the individual’s choices to collective ones made on behalf of the community. Toward the end of the nineteenth century an important phenomenon occurred that extended the process of Westernization to the social dimension. Contrary to what others have argued, this process followed substantially the same path as other parts of the West, that is, it entailed a redefinition of the forms of collective life. In the final analysis the new social actor, the individual, redefined forms of cooperation with others based on the individual’s preferences and interests.

Principal Carriers The importance that some scholars have attributed to the tensions and conflicts that broke out among the lower classes, blue-collar workers, and the urban lumpenproletariat has clouded a reading of the new Latin American society from the perspective of class. Scholars have attributed this class conflict to the quick, chaotic growth of industrial and financial capitalism (and, more recently, its reach into rural areas) that was exacerbated by the sometimes incoherent or insufficient reaction of the governments, beginning in the 1930s. However, scholars have paid insufficient attention to the lax application of the law, which intensified interclass tension, with the result that little was done to contain it and to support associationism and trade unionism, as in other parts of the West. In other words, in Latin America the social movements turned out to be more powerful than stable organizations such as labor unions; as a result many local demands could not be adopted by national organizations, and the gap between city and countryside and between rich and poor regions continued to fester. This problem has not abated because labor unions have been losing membership and influence, in part because of industrial competition and the need of industrialists to expand internationally during the economic restructuring phase that began in the 1980s. It is no coincidence that work productivity in the main industrial districts grew faster than real salaries. The novelty of contemporary Latin American social development is that people tend to see themselves more as individuals and to cooperate to resolve conflicts, even if inequality is growing. This secularization process also applies 244

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to politics, the economy, and culture; although it originated in the West, it has an especially Latin American flavor because of the nativist tendency to rebel against class-based, hierarchical divisions. In the 1910s in Mexico and in the 1940s and 1950s in Bolivia and Guatemala, rebellions turned into revolutions; in other countries such as Colombia, they became violent, though elsewhere they mostly embraced reformism. Most likely, acceleration of the process of racial mixing from the 1850s through the 1930s affected the rebellious tendencies because interracial equality tends to reduce class distance and promotes the social mobility of all classes, with the result that class opposition softened in all of Latin America. Still, in the absence of institutionalized mechanisms, the egalitarian tendency tends to bypass intermediate organizations such as associations, trade groups, labor unions, even political parties, and creates populist, charismatic movements that may become insurrectionist. Egalitarianism, when not institutionally enshrined, probably helped to slow down an important carrier of secularization, the transformation of the patriarchal or extended family into the nuclear family comprised of parents and their children. In Argentina the transition took about a century, more specifically, the reduction in family size from six to 4.3 members took place between 1867 and 1947. The change in Brazil was even slower: even in 1950 the nuclear family was not dominant, as the average urban family consisted of 4.8 members and the rural family of 5.3 members. In Mexico the transition had still not been achieved by 1970, when the average number of family members was 5.6. Anthropological studies note that until the 1980s the incomplete secularization of the family in the countryside and in the Indian and mixed-blood areas caused the persistence of client-type relations based on the interdependence of blood relations and compadrazgo (ritual coparenthood). Secularization has eroded the horizontal ties that united families and individuals of the same social rank and the vertical ties that joined families and individuals of different ranks. Interestingly, the old clientelism, known as caciqueado, has become a social form based on a dyadic contract, the exchange of favors; these days its main purpose is to facilitate the access of local communities and municipalities to the decisions of the central government through political or labor brokers as well as the Catholic and Protestant churches and other intermediaries. Although little is known about the most recent changes in clientelism, some elements of the old system, including personal loyalties, were transferred to the new neocorporatist organizations that appear even in the shantytowns on the outskirts of cities and in the various grassroots movements that are active in the cities and shantytowns. T h e S e c u l a r i z at i o n o f S o c i e t y

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The change in clientelism, one of the longest-lasting social structures of the subcontinent, is linked to the integration in the political system of the old and new social actors that helped break up the regional and local power spheres between the 1930s and the 1960s. In this period mechanisms arose that gave voice to the regional elites and propelled them onto the national stage in Brazil, Colombia, and Mexico, all countries with strong, long-standing regionalist traditions. The spread of the nuclear family is a good indication of secularization and of the growing autonomy of individuals, leading to a clear distinction between public and private spheres. Interestingly, the many ideologies that traversed the subcontinent, especially starting in the 1950s—liberalism, socialism, populism, nationalism, nativism, and the church’s social doctrine—have all promoted individualism despite their differences. The secularization process is thus a leading element for tracing the Westernization of Latin American collective behavior. It is possible to follow this change in public opinion in the spread of education and in commentaries in the press, on radio and television, and, more recently, on the Internet. It is important to remember that as late as the 1970s one obstacle to secularization was that more than 15 percent of the population in six of the twentyseven subcontinent countries was illiterate. In contrast with the widespread illiteracy of El Salvador (25.1 percent of the total population), Guatemala (45.8 percent), Honduras (48.5 percent), and Nicaragua (32.9 percent), the illiteracy rate in Argentina was but 3.3 percent, while Bolivia, Brazil, Mexico, and Venezuela reduced illiteracy by about half between 1980 and 2000. In Bolivia the illiteracy rate dropped from 27.5 percent to 13.4 percent; Brazil, from 25.5 to 14.7 percent; Mexico, from 16 to 9.1 percent; and Venezuela, from 15.3 to 6.6 percent. Illiteracy is disappearing, especially in the urban areas: among people aged fourteen to thirty-four, the illiteracy rate is 3.9 percent in Brazil and 0.8 percent in Argentina. The average Latin American illiteracy rate in that age group in the late 1990s was 2.8 percent. Given these literacy figures, the importance of tools that disseminate public opinion becomes understandable. After 1950 radio and television became powerful communication carriers in Latin America. First radio conquered the subcontinent almost as quickly as it did the developed countries; then came television: between 1980 and 1992 the number of receivers per thousand inhabitants rose from 99 to 165, while in the industrialized countries it grew more slowly, from 416 to 498. As a result the trend in Latin America followed that of the West, not that of Africa or Asia. Secularization also applies to the gradual diminution of the importance of 246

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the religious sphere in people’s lives. Statistically, from 1912 to 1945 the ratio of priests to population was 1 priest per 5.5 inhabitants, a ratio that held until 1992. The reduced presence of the church on a subcontinent that has been traditionally defined as Catholic probably owes to the decline experienced by all charity organizations. From 1982 to 1992 the number of Catholic hospitals decreased from 1,431 to 1,187. Orphanages, leper houses, and nursing homes did not increase; only the number of walk-in clinics did, from 3,402 to 4,389. Catholic education stagnated; in 1982–92 the number of students registered in Catholic elementary schools grew slowly, from 3.9 to 4.3 million; in the secondary schools, from 2.2 to 2.4 million; and in colleges, from 485,000 to 592,000. This decreased rate of enrollment at Catholic educational institutions owed to a decline in religious vocations but also, primarily, to an increase in the number of public and nonparochial private schools. While Catholic institutions were losing numbers, Protestant churches were booming. In 1930 Latin America had about one million Protestants; in 1960, seven million; in 1985, thirty-five million, or 9.5 percent of the total population. The growth has increased since: in 2000 South America had seventy million Protestants, or 12 percent of the total subcontinent population; they were expected to make up 15 percent of the total population in 2010. American anthropologists have explained this phenomenon as a form of individual opposition to the traditionalism of rural society and, in particular, of the Indian villages. This interpretation still holds, even if the Protestant churches are now recruiting their faithful mostly in the urban and suburban areas, where people find it more difficult to find their identity and thus seek a religious mediation that is less restrictive than the Catholic one. The growing availability of new public services has also facilitated secularization. Social expenditures—for health, education, housing, social security, and welfare—grew quickly after World War II, then slowed in the 1970s and 1980s. It picked up again only at the end of the 1990s, increasing from 10.1 to 12.4 percent of GDP on the subcontinent. Of these expenditures, education, health, social security, and welfare grew at the rate of 1 percent of the GDP each year from 1990 to 1997. Still, whatever social services exist, they do not provide universal coverage of essential needs. To do so, governments would have to spend 14.5 to 16 percent of the GDP. The lack of adequate social services is especially felt in smaller countries such as Bolivia, Ecuador, and Guatemala. The expansion of social services from 1945 to 1970 and again at the end of the 1990s suggests that citizens demand them. In sum, secularization seems to be the cultural cornerstone of the struggle to improve individual and community standards of living. T h e S e c u l a r i z at i o n o f S o c i e t y

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The standard of living index, composed of three indicators—per-capita GDP (based on the purchasing power of the U.S. dollar in 1970) , life expectancy at birth, and the adult illiteracy rate—shows significant improvements from 1920 to 1970 and a slower growth in the 1980s and 1990s. The best performing countries were Brazil, Colombia, Mexico, and Venezuela, while countries such as Argentina experienced a long slump that began in the 1970s. A comparison of the Latin American performance with that of the United States shows similar trajectories, although Latin America had much higher rates of population growth, especially from 1940 to 1970. It is important to keep in mind that population growth, especially between 1940 and 1980, is just one variable that affects secularization. The great wave of immigration that had helped to boost the population ended in the 1930s. From then on, especially after World War II, population grew internally. The subcontinent had 107 million residents in 1930; that figure doubled in the 1960s and again as the new century approached. The rate of growth spiked in 1950–70, declined in 1970–90, and picked up again from 1990 to 2010. Eleven of the twenty Latin American countries, including Brazil, Colombia, Mexico, Peru, and Venezuela, also followed this trend of expansion, then contraction of the growth rate. In Argentina, Cuba, Panama, and Uruguay population growth had already ended by the 1950s, while on Bolivia and Haiti growth began to stabilize only in the early 2000s. The decline in the total mortality rate had already contributed to population growth before the 1930s in Argentina, Cuba, and Uruguay, but on most of the subcontinent mortality rates did not begin to drop until after the Second World War. At that point population trends in Latin America begin to look much like those of other Western nations: a lower mortality rate, followed by steady birthrates, leading to the 1940–70 population boom and the growth of the succeeding decades. In the 1980s the mortality rate continued to decline, and the birthrate saw only a minor decrease. As a result whereas 42.5 percent of the population was younger than fifteen in the 1960s, this age group accounted for 37.6 percent of the population in 1985 and was not expected to show a marked decrease until 2010, when it was projected to account for 27.7 percent of the population. In other words, from 1960 to 2000 the active working population aged fifteen to sixty-five was supporting not just the elderly but also a growing number of children; specifically, each active adult supported four individuals. The demographic transition therefore must be seen as a powerful social conditioning factor that led to an improved standard of living and a convergence with the population trends of developed countries. In fact, the high 248

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percentage of nonworking-age individuals (younger than fifteen and older than sixty-five) reduces the percentage of the population that can work and purchase consumer goods. This is a significant obstacle to improving living conditions, because it requires investment in social services of funds that could otherwise be used to boost economic growth.

Urban Society The rapid urbanization of rural society also propelled the evolution toward secularization. The urban context encouraged individualistic behavior and strengthened interpersonal relations based upon shared interests. It also hastened the full monetization of salaries, which early in the twentieth century still were paid in kind or with company chits in the countryside and mines but also in the cities. The chits could be redeemed only in company canteens or at certain stores, restricting the workers’ economic freedom, helping to repress consumption, and fostering the persistence of clientelism. Clientelism would fade away starting with the demographic boom of the 1950s, as the rural population fled to the cities. The rapid urban growth from 1900 to the 1930s resulted from both immigration and the peasant exodus. In fact, population growth in the Brazilian cities of São Paulo, Rio de Janeiro, and Porto Alegre; the Argentine cities of Buenos Aires and Rosario; and Montevideo in Uruguay owed mostly to immigration from Europe, while the growth of cities such as Santiago and Valparaiso in Chile, Lima in Peru, Bogotá and Barraquilla in Colombia, and Mexico City, Guadalajara, and Monterrey in Mexico may be explained only by the emptying of the countryside. After the 1950s the natural growth of the population weakened the paternalistic and clientelistic relations that still existed in the cities. In this period the city became the center of social life and forced its rhythms on the countryside, helped by the growth of light and medium manufacturing and the expansion of city services, made possible by an expanded public administration. Little is known about the process of linking city to city, but a nationwide network already existed in the early 1950s. At the time the subcontinent was characterized by isolated settlements and complex cities with administrative, commercial, manufacturing, and cultural functions. The only three countries that saw a different pattern were Argentina and Chile, which had metropolises and a scarcely populated hinterland, and Mexico, with its villages and complex cities. The urban transformation that intensified the social Westernization of the subcontinent took place in the thirty years between the 1950s and the T h e S e c u l a r i z at i o n o f S o c i e t y

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1980s, when city residents increased from 37.4 to 69.5 percent of the total population. The number of urban dwellers grew at an annual rate of 4.1 percent, which was twice the growth rate of the population as a whole and four times higher than the rural population’s growth rate. This period saw the burgeoning of both the medium-sized cities (populations of 100,000 to two million) and the metropolises (more than two million residents). By 1980 the medium-sized cities and metropolises were home to about half—46.2 percent, to be exact—of Latin America’s total population. The new trend represented by the growth of the medium-sized cities and metropolises started in the south of the subcontinent—Uruguay, Argentina, and Chile—then reached the large and medium-sized countries of Brazil, Peru, Venezuela, and Mexico, and, last, the small countries such as Ecuador, Haiti, and more generally the Antilles. From 1950 to 1980 the metropolises expanded at a very high rate: 4.5 percent a year for Bogotá and Caracas; 4.9 percent for Lima; 4.5 percent for Mexico City; 4.7 percent for Rio de Janeiro; 4 percent for São Paulo; and 5.4 percent for Santiago de Chile. In this period, even with increased social spending and investments in the urban infrastructure, the subcontinent experienced a noticeable deterioration in the standard of living. This led to a dramatic growth of shantytowns and construction of illegal housing. The number of people living in shantytowns grew in Mexico City from 330,000 to 5.6 million; in Lima, from 1.4 to 3.3 million; in Caracas, from 1.3 to 2.2 million; and in Bogotá, from 917,000 to 3.1 million. At the end of the 1970s one-third of the people of Uruguay, Chile, Venezuela, and Mexico, and almost half the population of Brazil, Paraguay, and Guatemala, lived in shantytowns. As the new century approached, Latin America’s population reached that of Europe; in 1930 it had been just one-third the size of the population of Europe. The growth was achieved even as the demographic boom slowed down, caused by a lower fertility rate and increased emigration, especially to the United States and secondarily Western Europe. Nevertheless, the cities of the subcontinent have continued to grow: between 1980 and 2000 the number of people living in cities or towns with more than ten thousand residents increased from 65 percent to 80 percent of the total population. Map 7 shows the three metropolitan areas of Latin America that had more than ten million residents each in 1990: Mexico City, Buenos Aires, and São Paulo. Bogotá, Lima, and Rio de Janeiro each had five to ten million residents. Compared with Mexico City, São Paulo, or Buenos Aires, the other Latin American cities seem relatively small. In 1995 Latin America had eleven cities with more than three million residents each and forty-three 250

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Monterrey Havana

Guadalajara Mexico City

San Juan

Port-au-Prince

Puebla Guatemala City Managua

Santo Domingo Barranquilla

Caracas

San José MaracaiboValencia Medellín Panama City Bogotá Cali Quito Guayaquil

Belém Fortaleza Recife Salvador

Lima

Brasília La Paz

Córdoba NUMBER OF RESIDENTS

More than 10 million

Santiago

Rosario Buenos Aires

Belo Horizonte Campinas Rio de Janeiro São Paulo Curitiba Santos Porto Alegre Montevideo

5 to 10 million 2.5 to 5 million 750,000 to 2.5 million

map 7. Principal Latin American Urban Centers, 1990

with more than one million residents, fourteen of which were in Brazil and eight in Mexico. A significant percentage of the total population lives in the metropolitan areas: as of 1995 Buenos Aires was home to 35.9 percent of the total Argentine population; Santiago de Chile, 35.4 percent of Chile’s population; Havana, 20 percent of Cuba’s; Lima, 27 percent of Peru’s; and Montevideo, 50.3 percent of Uruguay’s. The urbanization process, which further reinforces Western social behavT h e S e c u l a r i z at i o n o f S o c i e t y

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ior, became more powerful at the end of the twentieth century thanks to the expanding influence of the metropolises. For example, in Brazil, São Paulo’s influence covered a range of more than 600 miles, from Belo Horizonte to the north to Curitiba and Porto Alegre to the south. Similarly, in Argentina, Buenos Aires’s influence extended from La Plata in the south to Rosario and San Lorenzo in the north. Greater Mexico City grew to encompass more than 3,000 square miles. Since 2000 the urbanization process has changed significantly; now it is characterized by a slower growth inside the old city centers, as people and businesses move to the suburbs and exurbs. While the population of the Buenos Aires metropolitan area decreased, that of Greater Buenos Aires increased 30 percent. Mexico City, a true megalopolis, includes the ancient original town (50 square miles), the federal district (570 square miles), the metropolitan area (some 1,750 square miles), and the greater metropolitan area, which encompasses the cities of Toluca, Cuernavaca, and Puebla, adding about 1,500 square miles. Unlike Buenos Aires and Mexico City, Bogotá, whose city limits encompass 100 square miles, has still not reached the stage at which people and businesses move to the outskirts; every day workers travel from within a thirty-mile radius to reach the city. We thus have an urban life characterized by the linking and absorption of smaller urban areas, within which is occurring a massive restructuring of businesses and services, with significant effects on the new Western urban culture, as interpreted by, among other things, Latin American cinema. The strong urban concentration is the result of the 1980s financial crisis as well as the economic restructuring of 1995–2005. Both processes gave way to new employment patterns that included layoffs of public servants, smaller investments in the public sector, and restructuring of industry. From 1980 to 2000 the number of farmworkers continued to decrease, large companies slowed their hiring, small and medium-sized manufacturing experienced a slump, and the service sector continued to grow; by the mid-1990s about 48 percent of the working-age population held service jobs. Two additional occupational changes had an important effect on society, and urban life in particular. The first was the rapid growth in unemployment, which peaked in 1960–70; the second was the strong growth of the underground labor market, especially in construction and household work but also peddling, day labor, and provisional trade work. Instead of fragmenting family life, such informal employment probably absorbed at least some of the labor that the official economy was unable to employ because of labor-saving technological innovations. At the end of the century these 252

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informal jobs employed 30 to 40 percent of the working-age population; thus, unlike the 1980s provisional work was no longer limited to the lumpenproletariat nor was it a type of underemployment but a type of work that even the middle class undertook, because it paid well, even though it was insecure and offered no retirement or other benefits. The Latin American work profile approaches the situation worldwide in only one respect: the loss of job security and continuity, and the smaller number of workers covered by some sort of social safety net. One reason is the larger number of people working in the informal sector; another is the trend at established companies: hiring provisional or freelance labor in order to keep salaries low and contain labor costs. Although precise data are lacking, this phenomenon also may be attributable to the greater number of women in the job market, the constant restructuring of industrial companies to stay competitive on the national and international markets, and, finally, the loss of influence experienced by labor unions, an outcome of the new low-intensity democracy of the subcontinent. All these changes in city life and in employment have forced people to make more choices as individuals and as families. Today, Latin Americans are much more secularized and individualistic than they were in the 1950s. This change is especially true of those who risk more, and they are not just low-income people but technicians, professionals, and white-collar workers who, unlike their counterparts in the 1940s–80s, are now exposed to downward social mobility. T h e W est er n i z at ion of Poli t ics

The twentieth century saw Latin America adopt Western forms of politics, a process that I am going to discuss by looking at the changes in the choices citizens have in terms of new forms of participation in national politics, the establishment of new urban-rural relations, the transition from a liberal to a democratic constitutionalism, and the changes in the presidential system. The Westernization of politics is a discontinuous process within continuity, insofar as it is conditioned on one hand by the evolving interaction of national and international spheres and, on the other, by ideological shifts and the new demands of citizens and governments. In fact, the early form of government, populism, which dominated from the 1930s to the 1960s, may be seen as a nationalist reaction to international difficulties and an answer to the new demands for greater collective rights. The later form, authoritarianism, which dominated in the 1970s and 1980s, was somewhat isolationist T h e W e s t e r n i z at i o n o f P o l i t i c s

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and tried to favor only bourgeois interest groups. Finally, the current form, democracy, which began to prevail in the 1990s, marks the convergence of the subcontinent in the sphere of the Western democracies.

Political Choices Secularization and social individualism have had a positive effect on Latin American politics by fostering greater individual activism and cooperation to reach political goals. The evolution of politics that began with individual choices and membership in associations is similar to the changes in Europe and North America. Thus, as the Mexican Octavio Paz writes, the inherent tendency is toward democracy. One might add that this propensity for democracy, which does not exclude regressive cycles, is the result of a creative interaction of the absorption of liberal and democratic ideals in the nineteenth and twentieth centuries and the informal, intermittent forms of freedom and equality that developed from ethnically and racially mixed populations, the geographic distance between the large cities and the vast hinterland in the colonial period, and, finally, the cultural cross-pollination that led Latin Americans to adopt Western languages—the principal carriers of Westernization— especially in the last two centuries. Cultural aspects are highly relevant in implementing democracy, which has been the dominant political form on the subcontinent since the 1980s. Here, as elsewhere, democracy is founded on the apparently antagonistic concepts of freedom and equality, which act dynamically to increase fairness and guarantee that people’s demands are heard by their freely elected representatives and implemented by the state. The process that encouraged the integration of democratic principles into politics is difficult to document, both because little information is available and because most studies do not much take into account the behavior of individuals as political actors. The data on the political changes of the 1960s and 1970s, measured by political scientists using the opinions of experts in Latin American affairs, show a significant correlation between secularization and political progress. In fact, free elections and civilian control of the military are highly valued in Uruguay, Costa Rica, Chile, Argentina, Colombia, Mexico, and Venezuela but not in Bolivia, Cuba, and the Central American countries. In the first group individualistic values are high because these countries cherish not only free elections and freedom of religion, opinion, and political organization, as well as an independent judiciary, but also social collaboration, which is apparent in the importance they assign to local govern254

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ment, social rights, universal education, national unity, and an efficient public administration. Existing studies of the 1960s and 1970s that include the final phase of populism report that, especially in the middle class, traditional values such as personal loyalty, friendship and family bonds, and a sense of hierarchy— values that tend to be antidemocratic—still survive. The tension between democratic and authoritarian values is visible in the Central American elites, which still today wield power by resorting to old colonial-type strategies such as marriage alliances and clientelism to control politics. However, authoritarianism has found strong resistance in recent decades in the growing number of citizens who seek new egalitarian forms, exemplified in women’s quick rise in the political world and the extension of the right to vote to eighteen-yearolds in the 1960s. Available studies report that women’s growing participation in politics fosters democratic values. In addition to adding about half the population to the political process, extending voting rights to women has universalized political action, thereby reducing the discrimination that women and children still encounter. The forces promoting democracy also come from movements and organizations that pursue ethnic, environmental, localistic, and antiglobalization goals. Their efforts belie the idea, prevalent in the 1960s and 1970s, that political action is based solely on class antagonism. There has been a growing recognition that a multiplicity of movements and organizations opens up new political spaces where freedom and equality coexist and encourages the convergence of Latin American political behavior with that of the West. The opening up of new political spaces has helped to reconcile interests and foster tolerance, moderation, and responsibility. Thus the earlier process, which was characterized by the diffusion of values from the top, from the elites, was replaced by an interactive one in which values move up from the grassroots to the elites. Associations such as cooperatives, cultural groups, labor unions, trade associations, and the like play an increasingly important role in the dissemination of a civic-minded culture. Their merit is in projecting individual choices at the level of the community, promoting the meeting of citizens and authorities. The available data for the 1980s show that associations became important all over the subcontinent, easing the transition from the statist labor unionism that was in vogue in the 1970s to one that is free. The wide variety of associations also helped to spread democratic values and practices because their by-laws call for holding free elections, extending rights to the opposition, and using proportional representation. In this sense the government’s support of T h e W e s t e r n i z at i o n o f P o l i t i c s

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associations, very strong from the 1930s to the 1950s, was positive because the associations, now free of government restrictions, have become autonomous, reinforcing pluralism and lessening class antagonism. Political secularization may be traced by following the dissemination of the political message. Since at least the 1930s major carriers of secularization were the electoral campaigns, which at times had the candidates speaking with the public through local and regional networks and organizations; coverage by the press, radio, and later television amplified the message. Since the 1980s communications have become multimedia, another example of the Americanization of the subcontinent. The populist policies of the 1930s–60s strongly shaped public opinion, especially in Mexico, Brazil, Argentina, and Chile; they spread their nationalist ideology through the schools, media, and subsidies to associations of low-income people, and by encouraging parties that were allied with the government. Also, populist policies cross socioeconomic boundaries, for they recognize and protect different interest groups. The supporters of cross-class politics wanted to transform populism into a corporatist regime, but they failed because not all interest groups could be included in the system—especially those espousing the agenda of the lower classes—given the gap between the population explosion and the decrease in public revenues earmarked for social services. All in all, populism contributed little to democratization because, when populism began to crumble at the end of the 1960s, its leading groups supported the military governments. In fact, the authoritarianism of the 1970s and 1980s suggests that populism failed to change the traditional behavior of the upper classes and the middle-class segments that had benefited from the so-called modernizing policies of populism. Opinion polls taken in Brazil, Chile, and Uruguay between 1978 and 1980 during the authoritarian regimes are significant: in Brazil 51 percent of those interviewed favored the regime; in Chile, 60 percent, but only 30 percent in Uruguay. Only in the 1980s did advancing democratization begin to shift Latin American political behavior. According to some opinion polls taken in Lima and Mexico City, 66  percent of those interviewed in Lima, and 52 percent of those interviewed in Mexico City, favored democracy in 1982; two years later 72 percent in Lima and 70 percent in Mexico City favored democracy. In 1986 the figures were 88 percent and 85 percent, respectively; and in 1988, 81 percent in Lima and 82 percent in Mexico City favored democracy. Interestingly, as the public consensus in favor of democratic governments expands, the number of people who look kindly on either revolutionary socialism or 256

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authoritarian governments decreases. A marked propensity for democracy became manifest in the 1980s and was probably aided by the revival of the liberal-democratic tradition that years of populism and authoritarianism had been unable to erase.

Citizenship, Political Classes, and Parties Citizenship, elections, and popular representation became consolidated in the nineteenth century in response to the demand for one person, one vote. The extension of political rights was revived at the beginning of the twentieth century with a new season of electoral reforms that gradually removed literacy requirements (Argentina in 1912; Uruguay in 1918; Colombia in 1936; Venezuela in 1947; Costa Rica in 1949; Chile in 1970; Peru in 1979; and Brazil in 1985), converting the right to vote into a duty as well. At the same time these countries extended political rights to women, first in Brazil and Uruguay (1932), followed by Venezuela (1945), Argentina (1947), Chile and Costa Rica (1949), Colombia (1954), and Peru (1979). In light of these changes, we can understand why populist and authoritarian governments alike never touched political rights, which prevented these governments from becoming all-out regimes. As a matter of fact, the populist constitutions did not alter the liberal constitutional guarantees of popular representation, the form of government, and the balance of power. Even when they were run by authoritarian regimes, Brazil, Chile, and Uruguay held elections for congress and referendums on constitutional questions. The growth in the percentage of citizens entitled to vote in the presidential elections began in 1937 and remained fairly constant, but the periods of greatest expansion were from 1937 to 1960 under the populist governments, and in the 1980s, with the democratization phase. Also, electoral participation was higher in the countries that were relatively more economically, socially, and culturally developed. Thus there appears to be a link between secularization and electoral participation and between that and institutional changes. This indicator shows that the extension of citizenship and electoral rights was a dynamic factor in overcoming both populism and authoritarianism, for they opened the way to institutional changes that granted universal voting rights and guaranteed the secrecy of the vote and the free competition of political parties, especially starting in 1980. These demands forced the governments to implement, at least partially, the promises made during the campaigns. One recent innovation is greater citizen oversight of congress, provincial assemblies, and local governments; another is the creation and proliferation of nongovernmental organizations that ensure a T h e W e s t e r n i z at i o n o f P o l i t i c s

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transparent and fair electoral process for all political parties (a development also encouraged by the U.N. and the OAS). The phases of growth, stagnation, and recession of electoral participation go hand in hand with meaningful changes in the political class and civil service. The 1930s and 1940s saw the arrival of a new type of politician who could link local and regional realities to the nation, providing a counterbalance to the charismatic role of the president, labor union leaders, CEOs of the large state-owned companies, and the directors of agencies of the populist governments. This new breed of politicians, managers, and civil servants stands apart because they are university educated, mostly trained as attorneys, engineers, doctors, and agronomists; they are also well acquainted with the local realities because they belong to family or client networks to which they owe their political careers. This group began to overcome its parochialism in the 1960s, when its ties to local power brokers began to weaken and those with international organizations, agencies, and businesses became stronger. Members of this elite, irrespective of their background, gradually constituted a technocracy with advanced skills, a good education, and great management skills. Unlike civil servants in Europe, whose careers depend on specific ministerial skills, those in Latin America receive their posts through the spoils system, with both high- and mid-level positions assigned by the president or ministers based on the individuals’ skills but also in reward for their support during the electoral campaign. The corps consists of a small number of individuals linked to both the president and a party, so that the secretary of a ministry can easily become, under a new president, an assistant secretary or minister, or the executive of a state-owned company, a diplomat, or a government representative at an international agency. Political careers under populist and even authoritarian governments are essentially technocratic, with little or no relation to popular representation. With the revival of democratic life, political activism—membership in a party, labor union, or association and participation in discussions and debates—regained favor. This positive situation was fostered by the alternation in power of opposite political forces, which occurred in Argentina, Chile, Brazil, Mexico, Peru, and Venezuela, and by the expertise that congress and the local governments acquired as a result of decentralization policies. At the same time the politicians’ styles changed—electoral campaigns became media events, and the popularity of the candidates no longer depended on their charisma but on their political and managerial skills. In the twentieth century leaders ruled from within an institutional frame258

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work, and even authoritarian governments could not violate international obligations. The respect for institutions was visible in the political class’s ability to draw up long-term, long-lasting policies. In the populist era the government created new state entities, enacted social rights legislation, and safeguarded the rights of labor unions. The democracies today are creating autonomous entities that are not subject to the spoils system and can guarantee the transparency of the electoral process, autonomy of the parties, and respect for civil rights. Still, populist and democratic leaders have different perspectives on the relationship between national interest and international context. Populist governments defended national sovereignty by not signing international agreements: they refused to sign the GATT Treaty in the 1950s and 1960s because it would have forced them to suspend protectionist policies and downsize the import substitution industrialization policies, or they passed local legislation that limited the effects of international agreements, as was the case with the creation of OAS, which I discussed earlier in this chapter. Democratic governments have a different orientation insofar as they believe that the national interest must be linked to the global one through legitimate restrictions of the country’s sovereignty, such as the creation of Mercosur in 1991, NAFTA in 1993, and the United Nations Framework Convention on Climate Change, which was signed at the 1992 Earth Summit. Since 1980 politics has tried to respond to the need for the constitutional guarantees of both new and old political actors. In this sense the parties are powerful mechanisms that organize the plurality of interests of a multiethnic and multicultural society. In fact, a careful look (beyond the usual platitudes) at the political development of the subcontinent reveals that all countries have adopted legal systems that ensure the rights of citizens. Cuba is the only exception as its legitimacy is founded on a revolution supported by a single mass party. Not even Mexico, which experienced a revolution (1911–17) and a single-party government for almost seventy years under the Partido Revolucionario Institucional, veered from its constitutional trajectory; the 1917 constitution and the later reforms maintained the two-house system and still allowed right-wing and left-wing opposition to organize into parties. In fact, former president Vicente Fox (2000–2006) belongs to the Partido de Acción Nacional, an opposition party founded in 1938. The same may be said for the two populist governments par excellence, that of Argentina’s Juan Domingo Perón (1946–55) and Brazil’s Getúlio Vargas (1930–45): although they manipulated and controlled institutions, neither could create unconstitutional ones. Not even the authoritarian governments that ruled T h e W e s t e r n i z at i o n o f P o l i t i c s

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Brazil from 1964 to 1985 could set aside the two-house tradition; in fact, they created ARENA, a government party, to oppose the democratic Brazilian Movement, thus easing the transition to democratization. Political parties have had a significant role in building a political system since the nineteenth century, when they were more like electoral clubs, highly informal associations. Many parties active at the end of the nineteenth century still exist today: the Blanco and the Colorado in Uruguay, Colombia’s conservative and liberal parties, Argentina’s radical and socialist parties, and Chile’s radical, liberal, and socialist parties. In the 1940s the parties were organized Western-style with liberal, Christian-democratic, social-democratic, and socialist platforms drawn from corresponding interest groups. The incremental nature of the parties is exemplified by the Chilean party system: despite its interruption by the 1973 coup d’état, today it is substantially what it was at the end of the populist era. The same may be said for Argentina, where, as is the case in other countries, the parties are divided into populist and reform parties, giving life to an imperfect two-party system. In other countries populism produced a discontinuity in the party system. In Brazil in the 1950s the government refounded the parties with just two: the left-leaning labor party and the center-right social-democratic party. In Venezuela the new two-party system has the social-democratic Acción Democrática and COPEI, a Christian-democratic party born in 1958, when a constitutional government was reinstated. In Brazil and Venezuela the reorientation of the interest groups promoted the reshaping of both center-right and center-left parties that in the 1940s already had become mass parties. Finally, a third group of countries, including Colombia, Honduras, Paraguay, and Uruguay, is characterized by a substantial continuity in the life of their political parties. In the 1950s and 1960s political radicalism favored the growth of socialist and communist parties and movements that increasingly adopted European formulas. Because of their cross-class platform, the left-wing parties found their consensus among the urban lower classes, and secondarily among the peasants, and formed coalitions that even won the presidency and parliamentary majorities. That was the case for Chile’s 1970 Unidad Popular coalition. It is important to note that a society that does not have marked class antagonisms forces both right-wing and left-wing parties to adopt cross-class positions, thus creating the conditions for the coalition of a plurality of interests, often at great variance from each other. These coalitions have increased in recent years, with the result that once the parties gain levers of power, they become “take-all” parties with pragmatic or eclectic programs and ideologies 260

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designed to have wide appeal, and they tend to expand by subsuming new interest groups. Such was the case for APRA in Peru, Alianza Democrática in Venezuela, the Chilean Christian-Democratic and Socialist parties, the Radical and Peronist parties in Argentina, and the Partido Revolucionario Institucional and Partido de Acción Nacional in Mexico. In the current democratization phase the Latin American parties tend to approach the U.S. model, joining together different interest groups and forging links between elite groups and between these and lower-income groups. This new tendency includes the growing adoption of the Western logic of alternation of power. This makes possible the transition from large organizations supported by governmental or private funds to less bureaucratic, grassroots organizations that give a voice to the new groups, which have grown rapidly in recent years. Starting in the 1990s, the party-based polarization vanished and electoral competition expanded, as demonstrated by the national and local party organizations, the percentage of votes received from one election to the other, and the freedom that citizens enjoy in choosing their representatives. Party transformation was rapid in Costa Rica, Chile, Uruguay, and Venezuela and slower in Argentina, Mexico, and Paraguay; in Brazil, Bolivia, Ecuador, and Peru the pace was moderate. Although the parties were unable to subsume the right-wing and left-wing extremist groups that question the new governability, the changes that did take place were important for democratization. The persistence, however, of vast dissenting groups of voters could make the new order resistant to the public’s demands or give it a veneer of populism that only promises to answer the citizens’ demands.

Constitutionalism and Institutions Since the nineteenth century one constant of Latin American political history has been the growing interest in reaffirming the people’s sovereignty as the source of the power of the republic, expressed Western-style in a written constitution. The history of Latin American constitutions, a subject that has not been sufficiently studied, suggests that the existence of a constitution prevents the state from crushing individual freedoms; in the twentieth century it led to the enshrining of expanded individual rights. The 1917 Mexican constitution, which recognizes workers’ rights and the peasants’ right to own land, documents the continuity of this discontinuity. Observance of the constitutional guarantees, including those of a social nature, has not always been easy because governments have had to grapple with the need to centralize power, wresting it from clientelism and the T h e W e s t e r n i z at i o n o f P o l i t i c s

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hold of the local caciques. Governments also have had to wrest power back from the military, which used the army too casually for police repression of middle- and lower-class dissent, especially from the 1920s to the 1940s. Another problem was the populist governments that assigned to the military the role of defending the nation from internal and external threats, converting it into the custodian of an undefined national interest. The relationship between civilian and military power compromised the constitutional order in almost all Latin American countries in the twentieth century and constituted a discontinuity with respect to the nineteenth-century tradition, when the military fought to establish national sovereignty by incorporating territories that were under state control only on paper. The presence of the military in twentieth-century political life manifested itself in two ways: the “praetorian” government, in which some military factions allied themselves with civilian groups for joint control of the government, and the “authoritarian” government, in which the military seized power with the cooperation of the technocratic and entrepreneurial classes. While praetorian military governments were in power in the 1930s and less so in the decades that followed, the authoritarian ones were strong in the 1970s and 1980s. A common feature of both was the weakening of constitutional guarantees, with restrictions on the powers of the judiciary and the executive and, especially, a strong hold on the legislature. From 1928 to 1934 about half the Latin American countries, including Argentina, Brazil, Chile, Peru, Venezuela, and the Central American republics, had military governments or were under military oversight. This situation also existed at the end of World War II, from 1944 to 1946, especially in Central America (Honduras, Nicaragua, El Salvador), the Antilles (Cuba and Santo Domingo), and only one South American country, Paraguay. These countries would remain under military control until 1955. A new wave of coups and military regimes took place between 1960 and 1973, not just in the Central American countries where the military was already in power in the 1940s and early 1950s but also in Argentina, Peru, Ecuador, Brazil, Bolivia, and Chile, where the military ruled until the mid1980s. This last authoritarian wave was different from earlier ones in two ways: the military organized it to counter a potential Soviet expansionism or revolutionary communism, yet the U.S. military and government supported, or at least tolerated, this authoritarianism. Unlike the earlier military governments, those born at the end of the 1960s lasted longer, because the populist crisis allowed the military to continue to rule with the support of technocrats and the interest groups that had received 262

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special treatment under populism. The military, technocrats, and big business formed alliances to stamp out class politics and reorient the elites toward the international market, opening the way for a new type of farming: agribusiness. Although the plan to limit the political participation of the middle and lower classes failed—a contributing factor was international public opinion in defense of human and civil rights—the military repression did not succeed in helping business and industry to become international. The most recent authoritarian wave taught the Latin Americans that once the military went back to its barracks and the civilian government had drastically cut the military budget, the only way to prevent the return of the military was to strengthen constitutional guarantees so as to restrict its authority to intervene in social conflicts; create effective procedures for civilian control of the military; and increase the army’s professionalism while barring it from performing the policelike role that in the past had triggered the military’s seizure of power. The end of authoritarianism once more brought to the fore the economic and social demands that the military regimes had forcefully repressed. Thus in the last decades of the twentieth century one element that had been essential to Latin American constitutionalism from 1930 to 1970—the trumping of individual and political rights by collective and societal rights—began to vanish. The new constitutions and constitutional reforms of the 1990s, in addition to extending collective rights, protect the rights of the individual and of private property. The new balance between individual and collective rights favors their interpenetration and strengthens both, avoiding the subordination of the former to the latter, as was the case in the populist era, or the preeminence of individual rights typical of the late nineteenth and early twentieth centuries. The result is that, just as in the other Western democracies, a tension between freedom and equality has become entrenched, and it reinforces the process of democratization, not only in cities but also in rural areas. However, in rural areas, especially Indian areas, this tension has sometimes led to the violent disagreement of those who favor communitarian property rights based on ancient custom and those who promote individual property rights founded on positive law. Still, the new institutional forms prevailing at the end of the twentieth century should not lead to an underestimation of the importance of the social and collective rights of the earlier period. As I have noted, the first country to recognize social and collective rights was Mexico in its 1917 constitution, which inspired the constitutional reforms of other Latin American countries. The Mexican constitution has two fundamental articles that regulate T h e W e s t e r n i z at i o n o f P o l i t i c s

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social rights. The first is Article 27, which attributes eminent domain rights to the nation, which retains ownership of natural resources, empowering it to expropriate land for reasons of state and to award usufructuary rights to subterranean deposits to private individuals or national or foreign corporations. This article permitted the Mexican populist governments to carry out a massive agrarian reform that distributed nineteen million hectares to almost 800,000 peasant families between 1934 and 1940 and to nationalize oil, a strategic resource, thus favoring the nation’s industrialization and economic growth. The second constitutional norm is Article 123, which regulates work, establishing a minimum salary, working hours, safeguards for the work of minors and women, labor union rights, the right to strike, and arbitration between workers and employers to resolve labor conflicts. The text of this article, composed of thirty paragraphs, influenced the rules of the International Labor Organization, which would disseminate them abroad a few years later. Social rights rapidly spread to the entire subcontinent from 1920 to 1940. The constitutional norms were not just theory, because new organizations and mass parties pressured their respective governments to implement them. At the end of the 1950s all the countries of the subcontinent had progressive social laws and institutions to enact them, with the result that from 1930 to 1960 the Latin American countries were the only ones in the Third World to adopt Western-type norms and institutions. The new labor laws helped to reform family law, granting full rights to women, including the right to be the head of household, a prelude to their participation in politics. The process of extending social rights was limited in the hinterland and among provisional, nonunionized urban workers (about half the workingage population). The stagnation of individual guarantees owed to an incompetent judiciary that was still subordinated to the executive and lacked sufficient budgets to meet its growing needs. This explains the frequently capricious nature of decisions at all levels, which exposed citizens to abuse, arbitrary incarceration, and violation of their freedoms and their property rights. The lack of adequate and independent civil, criminal, administrative, and labor justice at the local level eroded individual and collective rights. The limited independence of the judiciary was one result of the centralization achieved in the populist era, for populism had assigned to the presidency of the republic, through the ministry of justice, the power to appoint judges and subordinate them to public attorneys appointed by the ministers. The lack of judicial independence was even more serious in the federal states because of the double judicial structure—a federal judiciary that was more 264

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respectful of citizen rights, and a provincial system that was more corrupt and subordinated to the governors. The corruption of justice was also visible in the supreme courts, which are charged with constitutional oversight of law and jurisprudence, because supreme court justices are appointed in some countries by the legislature, in others jointly by the legislature and the president. Judicial independence was further eroded during the authoritarian years, when the supreme courts could not, as in Argentina, declare a coup d’état unconstitutional, and the judges (appointed by the military) had to accept the validity of technically illegal government acts. The transition from military regimes to democratic ones in Ecuador, Peru, El Salvador, Honduras, Bolivia, Argentina, Brazil, Guatemala, Paraguay, Chile, Panama, and Nicaragua, and from the “hard” authoritarian but still democratic governments of Mexico, Venezuela, and Peru, in the 1980s and 1990s, included reforms to the various constitutions. Political scientists agree that this constitutional renewal favored the consolidation of democracy, although, according to some, the excessive compromises reached in returning to legality created a situation that does not encourage citizens’ participation. Still, the pacts that reintroduced democracy on the subcontinent are based on the recognition of opposition parties and on the cooperation of the elites, with guarantees for the ruling class that had collaborated with the military. The policy of compromise chosen by the South American countries is not that of Central America and the Caribbean (Guatemala, Honduras, Haiti, Panama, and Santo Domingo), which experienced not only military rule but violent social conflicts that fragmented the elites and pitted them against the lower classes. The democratization in this part of the subcontinent was made possible by the return to peace brokered by, among others, the United States, Spain, and France and the cooperation of Latin American governments. The process of democratization took on a consociational form, sanctioned at the ballot box, as a result of which the ruling classes moved from conflict to cooperation. In countries such as Brazil, the return to power of a civilian government in 1985 took place through freely held elections organized by the military, while in Chile (1988) it was the outcome of a countrywide rebellion against the authoritarian government that had manipulated the outcome of a referendum granting Augusto Pinochet another mandate until 1997. In Argentina the military was forced to resign in 1982, after the country lost the Falklands-Malvinas War to Great Britain. Compromise settlements that paved the way for a return to democracy led to new constitutions that abolished the authoritarian ones of the 1970s and 1980s and reformed the earlier populist ones. Between 1985 and 1994 T h e W e s t e r n i z at i o n o f P o l i t i c s

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fourteen of the twenty-one subcontinent countries adopted new constitutions; they were later amended to improve the form of government and the electoral system and promote better relations between the presidency and congress. In addition, the new constitutions, such as those in Argentina and Peru, allowed the reelection of the president, which caused new rebellions. The new democratic constitutionalism, unlike the populist one, exhibits strong similarities to the Western models, because it also is supported by multilateral agreements among the subcontinent countries and by new clauses added to cooperation agreements with the European Union that void the agreement if one of the parties abuses democracy. The new constitutions include the right of citizens to participate in local, regional, and national governance and take into account cultural, ethnic, and gender differences. This beginning of a new activism for citizens, midway between individual and collective action, allows interest groups to voice their concerns at all levels, to enforce “delayed rights,” which are rights to land, language, food, ethnic culture, and transparency in government and rights against corruption, discrimination, and (for children and women) abuse. The new demands (what Latin Americans call “second-generation” demands to distinguish them from social rights) are the same ones found in other parts of the West and are one more indication of how deeply the subcontinent is becoming Westernized. These demands are about the expansion of civil, social, and political rights. The subcontinent has become an equal participant in communication exchanges, the use of cultural tools, and access to information. In consolidating the new democracy, the participation of citizens who know their rights and actively work to implement them is undoubtedly a good thing. This consolidation could be delayed—but not suppressed—by insufficient reforms to the judiciary or to law enforcement. Although both governments and citizens feel the need for these reforms, they harbor a generalized mistrust of the courts and the police. Poor prison conditions, the perception that human rights violations go unpunished, corruption, and the drug traffic, which thrives on the collusion of criminals and corrupt politicians, all add to the mistrust. These deep flaws contribute to an increased risk of violence, which, rooted in poverty and precarious living conditions, is fueled by the lack of reforms of the very institutions that are charged with maintaining law and order. Threats to the new democracies include the many demands for social and cultural rights resulting from a process of cultural differentiation, pluralism, and more individual autonomy by the Indian population and AfroAmericans. Large population segments are involved—the Indian population 266

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comprises forty to fifty million people (8 to 9 percent of the total subcontinent population), and Afro-Americans account for ninety to a hundred million residents (about 20 percent of Latin Americans). These groups demand recognition of their customary laws, many of which conflict with the individual rights enshrined in the constitutions balanced, as I said, on the tension between freedom and equality. These demands, ethnic ones especially, tend to break up the constitutional order and create new corporatist forms that could restrict the principle of equality before the law, which is the foundation of democratic life in Latin America as well as the rest of the Western world.

Centralization, Federalism, and Presidentialism One significant achievement of nineteenth-century liberalism was the creation of a form of government that could contain and reverse the fragmenting tendencies nurtured by the strong provincial and local power centers in the first fifty years of independence. In all the Latin American republics the local and regional potentates—the caciques—were still strong in the early twentieth century. During the Mexican revolution, when the second republic was born in Brazil in the 1930s, and during the 1952 Bolivian revolution, they played an important role in the birth of the new political order. Their strength remained formidable everywhere until the 1940s because they used the new forms of political leadership to gain seats in the national congresses, provincial assemblies, and municipalities. Defeating these tendencies was coupled in some countries with the need to contain the chaos that prevailed between the two world wars. In defending their sovereignty, the various governments centralized power; they were reacting to the fallout from the world economic crisis, the deterioration of social conditions, and the growing demands of the middle and lower classes for political participation. Political centralization involved a form of constitutionalism that was careful about social rights, but also about excessive power, especially that of the executive branch. The centralization affected all Latin American states, both the unitary republics and the federal ones: it significantly shrank the local autonomies between the 1930s and the 1960s, subordinating local and regional governments to the capital and the executive branch. In the unitary republics control from the center became more entrenched, transforming the administration of the territory into a branch of government. Municipalities became subordinated to prefects appointed by the ministry of the interior, which exercised a strict control of the mayors and municipal councillors, reducing their autonomy but also the clientelist control exerted by the caciques. T h e W e s t e r n i z at i o n o f P o l i t i c s

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The reduced freedom of the municipalities went hand in hand with the priority that governments and citizens gave to social rights and the inroads made by political secularization; the extension of social services to the rural population also helped. In Colombia, Ecuador, Bolivia, Nicaragua, Peru, and Santo Domingo centralization and the concurrent restriction of municipal autonomy were very strong (mayors were appointed by the prefects), while in Mexico the agrarian reform of 1936–40 brought about a de facto reduction of municipal power by giving the ejido—the district established by the reform—the power to elect the district commissioner. Municipalities became increasingly dependent on the central government for financial allocations. Still, local authorities continued to hold power in the Indian and mixed-blood villages, selected by consensus, though these too were now more heavily controlled by the prefect (in the unitary republics) and the regional governors (in the federations). Decisions that directly affected people’s lives, such as those involving water, electricity, public housing, and such, were now made at the national level by agencies and committees set up by the populist governments. Much more complex was the form that political centralization took in the federal republics of Argentina, Brazil, and Mexico. For them the main obstacle to the penetration of the federal government was the strict division of sovereignty between the federal government and the provinces, or states. In the early twentieth century this rigid division prevented forms of joint responsibility that would have safeguarded political freedoms and prevented the recurring tensions in federal-state relations. This failure in Argentina and Mexico pushed the federal governments to accept the centralization that implicitly accompanied the nationalism and corporatism that were blowing in the subcontinent. In Argentina, Brazil, and Mexico the federal government was given a hegemonic role and became identified with the nation, represented by the president. As such, the executive could force the various corporatist interests into interclass agreements that would make the country easier to govern. The neocorporatist form gave to the federal government, the presidency in particular, the power to intervene in the economy and in industry, control natural resources, promote economic development, guarantee social rights, and mediate labor conflicts. In sum, the legislative and judicial powers became subordinated to the presidency. In this period the governments, in addition to taking on new international duties, tried to strengthen federal decision-making powers. For example, in Brazil Getúlio Vargas (1930–45), supported by the army and the church, 268

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reduced the power of the provinces to contract foreign debt or spend more than 10 percent of their budget for their police department. His purpose was to limit the power of the provincial armies. He also intervened in the economy by creating the National Coffee Agency to regulate the coffee trade (the principal export commodity). These and other centralizing policies greatly reduced the political clout of the richest regions of São Paulo, Rio Grande do Sul, Rio de Janeiro, and Minas Gerais and converted other provinces into clients of the federal government. In Mexico the federal government first took over the tasks that the various regional entities had seized during the 1913–17 revolution. It then gave itself the power to regulate labor and created a government party, the Partido Nacional Revolucionario, later renamed the Partido Revolucionario Institucional. In the 1930s through the 1960s, the federal government used this party to expand its power over the economy, labor unions, and rural areas and subordinated the military to civilian power. The growth of federal power in Argentina began with the 1916 victory at the polls of the Unión Cívica Radical, which used federal intervention and the army to impose new radical governments in the provinces. Starting in the 1930s, both during the military governments and under Juan Domingo Perón (1946–55), the federal government saw its power grow in all areas, while that of the provincial governments shrank. Like Mexico and Brazil, Argentina developed a vertical type of government with close links between the executive branch and the Peronist movement, which greatly restricted the opposition parties and subordinated the labor unions to the presidency. Federalism shrank as the power of the presidency grew. The Argentine president Hipólito Yrigoyen stated that the president was the repository of popular sovereignty, and the Mexican president Venustiano Carranzo affirmed that the president embodied the relationship between a government and its people. Both in the federations and in the unitary republics, centralization gave rise to populist presidentialism, interpreted by Europe and North America as the rise of the caudillos, the charismatic populist leaders. The president increasingly became the nation’s spokesman, using a vast popular consensus to direct power toward the figure and institution of the presidency, such that he came to dominate the political system. From the early twentieth century until the 1960s therefore, these countries made a transition from constitution-given presidential powers to presidentialism, an elaborate system that gave the presidency supremacy over the other two branches of government. Presidential powers were still somewhat limited at the end of the nineT h e W e s t e r n i z at i o n o f P o l i t i c s

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teenth century, and in most countries the president had no veto power over the legislature. The transition from the presidency as a moderating power to presidentialism was concurrent with the gradual loss of power of the legislative branch. The growing number of candidates made it difficult for citizens to understand the merits of the candidates or influence their electoral platforms. To solve this problem the Latin American countries created a double voting system: one to elect the president and another to elect congress. In voting for the president, citizens would identify the candidate with the entire nation; in voting for congress, they would identify local and regional demands. Under this system citizens expected the president to tackle the larger issues and the senators and deputies to handle day-to-day issues. The balancing act between president and congress was a highly unstable one because, while the president expanded his areas of competence, both formal and informal, aided by his ability to appeal directly to the people in case of conflict with congress, the legislature’s role tended to stagnate, because it had to meet the specific demands of the various power groups. Thus the president’s powers did not grow independently of the powers of the legislature, because the president had to rely on the cooperation of congress to pass laws and constitutional reforms. The president, however, could prevail over the legislature through his control of the government party and the labor unions and his influence with business and industrial associations to effect the election of candidates acceptable to him. The president’s ability to augment his powers is based on the principle that the head of government, who is also the head of state, does not report to congress. The ministers are appointed and serve at his pleasure; congress can only pass a political judgment on them. The president and his cabinet have no direct way of acting on congress: it can be dissolved only by a coup, hence the two branches must interact with one another because the president, who has the power to authorize expenditures, can also bend the will of the opposition parties. Latin American presidentialism is thus characterized by the powers that presidents succeed in appropriating to themselves, against resistance from congress (such as Chile from 1938 to 1946) or from the states (such as in Brazil in the 1940s and 1950s). Even in Mexico and Argentina, where the president is so powerful that he receives broad legislative powers from congress, he is restricted by the need to assuage the leading interest groups within the governing party and the military. The dominance of the presidency does not generate, as some believe, a tendency toward dictatorship, though it does generate strong authoritarian attitudes that explain the continuity between the “imperial” populist presi270

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dency and the authoritarian governments of the 1970s and 1980s, and could thus be a threat to democratization. Populist presidents, however, cannot become dictators because of a constitutional ban on reelection; this ban has been in place in Mexico since the 1930s. In Argentina and Brazil the reelection of Perón and Vargas, respectively, strengthened the opposition parties, creating the premise for their removal. In these two countries public opinion and the opposition parties (and in Argentina also the church) acted to curb presidentialist excesses. By analyzing presidentialism, its connection with the process of centralization, and the addition of new political actors, the link between populism and authoritarianism becomes obvious. Authoritarianism was present in those countries where, more than in others, governments could not continue dispensing social services because they did not have the revenues. In Argentina, Brazil, and Chile the stagnation in the provision of social services exacerbated insurrectionism, which broke out in guerrilla movements. The president tried to control the dissent by shoring up the armed forces, which were also important in populist times, and by pressuring public and private industry. The coming to power of authoritarian governments that suspend the rule of law in whole or in part is thus the result of a political and social polarization: the government tries to legitimize itself by claiming that it wants to prevent a communist coup d’état. But, unlike the inclusive logic of populism, authoritarianism leaves out of the political discourse those elements it deems subversive, though it uses the same ideological pitch as populism, that is, the defense of the motherland threatened by internal or external subversion. In the authoritarian phase, which was shorter than the populist one, the power of the executive reached its zenith: presidents could act independently of the groups that supported them but also could call on industrialists and businessmen, as well as the technocrats who had grown up in the shadow of populist governments, to serve. Both authoritarian and populist governments have another feature in common: statism, or the abnormal growth of presidential powers. Citizens of all classes can oppose statism and presidentialism at the ballot box: they can vote to elect congresses that can control the executive, establish a new balance of power, and initiate procedures to decentralize the state’s powers in favor of municipal and provincial governments. They can also create new participatory mechanisms to meet the demands of new groups. This is a new horizon in Latin American politics that could help create responsible administrations more attuned to the needs of their citizens. This requires T h e W e s t e r n i z at i o n o f P o l i t i c s

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new political and administrative forms that must be rooted locally, mechanisms that can establish new forms of communication between the state, the administrative entities, and the citizenry. A new form of communication must be one that can reconcile local demands with globalizing ones, that is, a strengthening of the centuries-old process of Westernization of Latin American politics.

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Conclusion

Historical Forms and Trends

In the late 1980s historians became tired of narrow ideological approaches and turned to the then-emerging postmodernist theories. Some, however, like me, still believed that historiography should be able to collaborate with the social sciences and the humanities and compare national and continental experiences. We turned to comparative history, thus going beyond the strictures of structuralism, and resumed the analysis of events in chronological patterns, relating local phenomena to events happening in other parts of the world. The comparative approach has helped us to better grasp the innovations of globalization and to criticize those theories that see the phenomenon as simply a result of European expansion into Asia, Africa, and the Americas in the early modern age. From this we have developed a world-historical approach designed to offer broader interpretations of events, expanding historical research with contributions from the social sciences and other allied disciplines. The resulting multidisciplinary perspective allows world historians to include all the social sciences and the humanities in the study of the past and to organize their analyses in terms of comparative processes. Starting from these premises, this historical study reevaluates the ability of individuals and groups to act both locally and transnationally by analyzing the interconnections at work both in definite geohistorical locales (such as the Mediterranean world, Atlantic world, or Latin American subcontinent) 27 3

and between them, bringing out the distinctive modes of participation in the world’s affairs by the different human communities. In studying these interconnections world historians can identify relationship networks, interdependencies, and symmetries or asymmetries between the various countries and areas of the world. Such a comparative, methodological approach permits historians to go beyond the Eurocentric vision of the old universal history, unearth the teleology buried in the accepted paradigms, and question anew the implicit structuralism that lies behind the center-periphery approaches. Thus a world-historical approach can connect the contingencies of distinct areas and countries to an overall view of worldwide transformations, questioning the principle of causality, hence the “world system” view that assigns too much importance to the other-directedness of historical subjects, for these approaches leave insufficient space for an individual’s freedom of action and the spontaneity of communities as they seek interconnections to overcome their national and international limitations. Again, the “world system” is more than just an international hierarchy of inequalities and asymmetries, because the international division of labor is not the sole engine of world history. The relationship networks and the interdependencies of the human communities allow us to bypass the determinism that is implied in world-system perspectives, its notion of European exceptionality and of the hegemony of the great powers, but also the narrow economist approach that permeates many such studies. Here I stress interconnections within Latin America and between it and European, African, and Asian communities. I also stress the multiplication, differentiation, and complexity of interconnections and their changing historical forms, from the sixteenth century to today. No community ever reacts mechanically or as another community would to outside stimuli. The historical forms that the international participation of the subcontinent has taken shed light on the different economic, social, political, and cultural forces that drive a community to collaborate with the world or turn it inward toward isolationism. As the American subcontinent became part of world history, at first we see constantly evolving reciprocal actions that connected the native human communities to the foreign ones, multiplying and giving rise to lasting institutions that would change over time. The economic and political interests of different historical subjects, their decision to consolidate their entry on the international scene, modifying internal and external restrictions and expanding their rights, spurred Latin American participation in the international 2 74

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context. For human decisions are what set or modify priorities: sometimes economic reasons will prevail; at other times the motivation will be cultural or political. Therefore, the forms of participation of the different subjects or areas cannot be identical, and all change over time. Using these premises as the foundation, I have tried to trace the historical forms of these interconnections. The first historical form, the entry, began with Europe’s discovery of the American continent and ended in the early seventeenth century. The dramatic form of the entry would not determine the later historical forms of participation, although it was one determining feature. The entry into world history had its own specificity, derived in part from the connections that began to form between the native Indian populations and the newcomers—Spaniards, Portuguese, French, Dutch, and English—and in part from the connections between the American subjects and the European metropolitan areas. The modes of interaction between the native populations and the newcomers are vitally important, since at the time both were numerically small and inhabited vast spaces. This partially explains the enormous difference between the American institutions and those of the Old World and the decisive importance of the quickly emerging relations between American, European, African, and Asian areas. The entry of the American subcontinent in world history was a complex process in which conquerors and conquered fashioned forms of coexistence that created the New World. The constant, reciprocal adaptations and interconnections produced the forms of cooperation and conflict that developed and evolved in the subcontinent and abroad. Thus the entry was not simply a clash between Iberians and Indians but a more complex, nuanced phenomenon at the heart of which were mixedblood unions and the blending of Indian and European cultural, social, and economic forms, which generated a new dynamics endowed with great spontaneity. Favoring the process was that the conquest took place without any awareness that the country being invaded was a new continent and that the invaders had no predetermined plan of colonization. As to the Indians, it would not have been possible for them to consider the Europeans as a people different from all the other groups that populated the continent. Nor was it possible for the Indians to react from the very first with the intention of repelling their subjugators, for many natives at first saw the Spaniards as potential allies in their fight against the expansionistic goals of other Indian nations. The Americanization of the first Europeans and the first Europeanization Historical Forms and Trends

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of the native populations gave birth to a new world indeed, characterized by a multiplicity of informal, spontaneous arrangements. They were made possible by the “colonial freedom” that, while favoring Iberian and Indian notables and potentates, also left a relative degree of autonomy to the lower strata such as the Indian peasants, mestizos, and mulattos. These adaptations, mixings, and cultural and physical unions were the leading factors that brought the Latin American world onto the world stage. From this was born the variety of Latin Americans’ reactions to the emergencies generated by contact with the Europeans. For example, Mesoamerican languages were immediately transliterated to the Castilian alphabet, but that was not the case for the Andean languages. Entry into international channels promoted the dissemination on the subcontinent of new production techniques and the use of animal power, as well as the introduction of European products, and conversely the dissemination of Latin American goods in the rest of the world. The transforming force of this first historical phase mitigated the negative effects of the initial, dramatic impact and helped accelerate the integration provided by mixed-blood unions. This first phase began to exhaust itself in the early seventeenth century, once the relationship between Iberian and American realities was already firmly established. In the second phase new forces promoting change moved, generally speaking, from the international scene to Latin America, adapting and interconnecting Iberian and Latin American institutions. This was a process of Latin Americanization in which Iberian laws and institutions were adapted to native customs and spontaneously born Latin American arrangements. As a result the relative autonomy of the subcontinent under Iberian colonial rule expanded. The phase from the early seventeenth century to approximately 1750 saw the strengthening of Latin American life and institutions, along with their autonomy, a remarkable phenomenon when compared with the general situation in Europe. What is more, the vast virgin territories were amenable to the birth of new, informal interconnections, including with African and Asian areas. The subcontinent’s growing participation in the international system was shown by its ability to expand legal commerce (under the royal monopoly) but also contraband trade, with both forms needed to satisfy the demand for European goods and to distribute Latin American products. An analogous parallel existed between theory and practice in the typical form of indirect rule that governed the subcontinent, an unwritten covenant between the Iberian monarchies and the Latin American potentates. Under this “colonial covenant” the top levels of the administration and of justice 276

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were reserved for royally appointed viceroys, governors, magistrates, and tax collectors, while the local and regional administrations and the courts were left to the Creoles and Indians, who ruled their districts through the municipal councils and who enjoyed a modicum of autonomy from the royal representatives. The seventeenth century, the second historical phase, was one of Latin Americanization: essentially, the Iberian estate-based and corporatist distinctions were changed by the multiethnic and multiracial reality of the subcontinent, unique in the world, for in this century the coexistence of different ethnicities, cultures, and races became established. This improved the relationship between metropolitan Iberia and the colonies and made the latter more easily governable, at least until the 1750s. The strength of the new Euro-American world and its relative autonomy explain one of its most important successes: its ability to check the absolutist policies of the Spanish and Portuguese kings. After the French and the American revolutions, the international order underwent a sea change, motivated by the search for a new constitutional order that would guarantee human and citizens’ rights and impose limits on absolute power. The era of the written constitution inaugurates the century of international change marked by the active pursuit of political and economic freedom and equality before the law. These values would inevitably cause the second Ibero-American historical form to crumble and dissolve. The most important aspects of this transformation are the Latin Americans’ pursuit of freedom and their determination to create new, independent, and sovereign states that could control their territory as well as take their place at the international table, based on the premise that Europe and America shared the same values. Given the small number of European powers at the time, the addition of the new American states to the international scene inevitably gave rise to strain and conflict, especially as Europe was feeling the winds of Restoration. On the subcontinent the transition from the status of colonies to that of constitutional republics was particularly difficult, because the new nations born from the wars of independence faced unique challenges, such as breaking with the colonial corporatist order, and received only scant support from the European monarchies, which refused to recognize their full sovereignty. Hostility from abroad and the persistence of the old hierarchical order weakened the transformative power of liberal values, so that the integration of the subcontinent in international commerce and in the new financial world was partial at best, delaying the construction of new national instiHistorical Forms and Trends

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tutions. Still, the challenges experienced in the early nineteenth century may have further spurred the Latin Americans’ resolve to have their sovereignty recognized, approve their constitutions, found their nations, and give themselves laws guaranteeing the rights of private property, free trade, and freedom of speech, press, and assembly. In any case they were supported by a growing favorable public opinion, in particular the support that liberals and republicans gave to Mexico during the French invasion, the support of abolitionists who opposed slavery, and the denouncing of new forms of colonialism. After the 1850s the new republics became stronger and a new period of cooperation with Europe ensued. A vast array of political, cultural, social, and economic carriers supported this cooperation. New constitutions reformed the system. The new governments’ support of education made the public receptive to foreign stimuli and spurred creativity in literature and the law. Immigration from Europe aided the renewal of society, especially in Argentina, Uruguay, and Brazil. In these decades Latin American industry forcefully exploited the new steam and oil technologies, railroads and steamships, telegraph and telephone, banking and financial services with the aid of large government subsidies. Foreign companies brought with them the resources and technologies of the second industrial revolution, developing competition with the industrialized countries. All this, coupled with a reduction in the cost of commercial transactions, led to strong commercial growth. I call this form of participation in the international system “Euro-American” because it was a deliberate cooperation on both sides of the Atlantic, different from the earlier ones, when the subcontinent had been marginalized. Unlike the earlier historical forms, this deliberate Euro-American convergence was characterized by shared trends. For example, the subcontinent played an active role in developing principles of international law. A similar trajectory on both sides of the Atlantic led to forms of coexistence and to the peaceful resolution of conflict. The international financial market of London played a central role in this convergence, acting as a hub for the other large financial markets of Paris, Berlin, Amsterdam, and New York and the secondary markets of Vienna, Milan, Barcelona, Buenos Aires, and Rio de Janeiro. The free movement of capital, technology, and information from the industrialized countries to the rest of the world gave rise to the first process of transnationalization of the Latin American subjects. The convergence of institutions that followed clear rules and regulations fostered the development of shared practices on both sides of the Atlantic. 278

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As a result the subcontinent countries finally gained full recognition of their sovereignty, which they needed in order to participate fully in the international concert. A decisive impulse to extend recognition to the subcontinent countries was the European notion that all states were bound to act in the market by following shared sets of rules; the subcontinent countries responded by joining the international currency board and adopting the gold exchange standard. These interconnections reverberated in all Latin American countries, leading to the birth of true national economies with a single market and the states’ reining in of the caudillos and their clientelistic interests. Such strengthened nation-states, and the enforcement of their domestic and international sovereignty, led to a reformulation of the balance of power. Its control of its territory now secure, the new nation-state developed new functions such as the promotion of justice, stimulation of economic growth, and development of culture and of social networks, all factors that helped strengthen the ties between the government and its citizens. In this period countries began to be measured quantitatively in terms of population, production capacity, revenues, and army and navy power. In this Euro-American phase the subcontinent accelerated its internationalization, a process very different from the contemporary process that began in the 1970s and would be called globalization. Nineteenth-century internationalization was understood to be based on a strong nation-state that could defend its borders, regulate the domestic market, direct foreign investment, and control immigration. In sum, it did not embrace all the aspects of national life but only those having to do with the free movement of the means of production, labor, and ideas. Today’s globalization is a different historical phenomenon, in both Latin America and the rest of the world. The idea of a continuity between the two phenomena, such that the gradual weakening of the first phase enabled the transition to the current one, seems to have no merit. Internationalization partially dissolved in the period between the two world wars when the inordinate growth of corporatism, statism, and protectionism gave primacy to the state over the search for an international equilibrium. In this chaotic hiatus between the wars, the nation-state was the only entity that became stronger, justifying its politics in the name of national interest. An analysis of the nationalist, corporatist, and protectionist policies that took over after the demise of the gold standard shows that in both Europe and the Americas the nation-state absorbed all the anti-internationalization forces that had first appeared in the nineteenth century. Many people held Historical Forms and Trends

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market forces and internationalization responsible for threatening national sovereignty and for destroying the traditional forms of community solidarity that had survived in vast parts of Latin America. In fact, Latin America did not look with disfavor on Nazi Germany and Fascist Italy, and Latin America’s collaboration with the Allies was limited. After Pearl Harbor the subcontinent countries began to declare war on the Axis powers, although Argentina and Chile did so only at the last possible moment (March and April 1945, respectively). It is true, in any case, that from 1914 to 1950 many internationalization elements survived in the established commercial, political, and social networks and in some cases were strengthened: the struggle against totalitarianism, the rise of the socialist internationals, the activity of the church and world trade all worked to stop the dissolution of internationalism. Culture was also important in creating in the public a propensity for internationalism from which the current historical form of globalization would evolve. The path toward globalization was and is thorny. At first it was strongly conditioned by the cold war and the various national interests that emerged in the unsettled period between the two wars. In Latin America the expanded powers of the nation-state checked the drives toward globalization, putting into place policies to control foreign investment and finance, along with corporatist policies that favored each country’s bourgeoisie. It was not a coincidence that the factors that spurred the current wave of globalization first appeared in the 1970s when, as I have noted, the cold war was thawing, polycentrism was beginning to emerge, and the state-centered model was entering a downward spiral (Nye and Keohane 1971). The first inkling of this new situation was the creation of a new, undefined space outside the margins and interstices of the national and international dimensions but in any case outside the state’s control. This emerging reality favored the birth of social, economic, and political subjects who act transnationally, thus coming into conflict with the nation-state. Toward the close of the twentieth century, the collapse of the protectionist economy and unprecedented migration opened new transnational fields of action for Latin Americans. While the upper bourgeoisie already moved in international circles, easily transferring from Mexico City to New York or London, more recent migration is an unprecedented phenomenon because it is no longer limited to the unemployed, hungry, or political refugees but includes tourists, intellectuals, business people, professionals, and students, a mixed avant-garde of so many who, while keeping their residence in their home country, move about internationally as well as through the Internet. 280

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Starting in the 1970s, the signals that portended the end of what must be considered the first modernity, which began in the nineteenth century, started to become manifest. Like the rest of the world, the subcontinent entered the globalization process, which inevitably modified the definition of historical attributes and the very concept of the nation-state. The contemporary state has been increasingly forced to accept and come to terms with the plurality of social spaces, communication networks, market relations, lifestyles, and management of resources that cross national frontiers and elude government control. The smaller role of the state and the government has freed economic forces but also those social, political, and cultural forces that were once under the aegis of the nation-state. The impact of this dynamism of interconnected forces has helped strengthen the process of globalization and accelerated change. Aware of the increasing shrinking of social welfare, individuals have become risk takers. Penalized by their countries’ inability to offer them acceptable living standards, they find on the Internet and through other modern forms of communication the information they need to seek a brighter future. This phenomenon alone would suffice to undermine a perverse, negative conception of globalization and reinforce the opinion of those who see in globalization a new world of opportunities. The networks and interconnections created by globalization offer individuals and groups a plethora of opportunities that the governments can neither stop nor delay. As a result globalization can be taken to denote the stretching and deepening of social relations and institutions across space and time such that, on the one hand, day-to-day activities are increasingly influenced by events happening on the other side of the globe and, on the other, the practices and decisions of local groups or communities can have significant global reverberations (Held and McGrew 2007). The phenomenon of globalization offers individuals the possibility of thinking that multiple forms of global interconnections and communication do exist. For example, the interconnection of the Latin American markets with the markets of the rest of the world permits the exchange of goods, work, currency, and services but also creates new forms of interaction between governments and national and multinational companies. This process affects both the United States and Latin America (Brown 2003). The same antiglobalization protests are organized in places as diverse as Seattle, Genoa, or Chiapas; the protesters do not intend to safeguard the old nationalism and protectionism but rather express a transnational politics that, ironically, reinforces globalization. Historical Forms and Trends

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It is impossible to predict how long the current historical form, globalization, will last. The study of past forms teaches that their duration depends on the conflict between the forces promoting their consolidation and the forces opposing it. Although hostile forces should not be underestimated, the benevolent forces seem much stronger, for they are multiple and the types of interaction and reciprocity they generate lead people and groups all over the world to gather in nongovernmental organizations or local, regional, and international groups. How long this epoch will last will depend on the vitality of its innovative drive and, more specifically, on the intensity with which interrelations and interconnections will develop both inside each country and internationally (Held and McGrew 2007). Two aspects characterize the subcontinent’s current participation in globalization: its range and extension and its links in cyberspace. Computerized communications that bring people closer in time and space enable the breadth of the social networks. New forms of political organizations, such as the membership of the Latin American states in international and regional bodies that promote democratic progress, are a reflection of an active citizenry critical of government that finds important support in international oversight organizations. Globalization requires shared rules and oversight bodies to verify compliance, thus favoring the birth of an environment that nurtures a more knowledgeable, circumspect public opinion. The weak points of globalization may be put to good use by the Latin Americans, who, having come late to the party, can learn from their mistakes and those of others. However, if Latin Americans continue to perceive globalization solely as a carrier of doom, its risks will multiply and will nullify the efforts made thus far. Studying the historical forms taken by the subcontinent in participating in world history has uncovered a manifold, multilinear process that actively promoted the Westernization of this part of the world. As a matter of fact, despite claims to the contrary, Westernization was not a linear, ascending movement, a simple, almost inertial, evolution from the Iberian conquest. The Westernization of North, Central, and South America was a process in which accelerated moments alternated with slower ones. Also, depending on the historical form, the economic, cultural, political, and international interconnections took on varying degrees of importance. The basic idea that I have tried to develop in this book is that Westernization was not a one-shot affair that happened at a specific time in history, destroying and wiping out preexisting civilizations. On the contrary, it was a process that moved ahead by trial and error and promoted the interaction of native 282

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and nonnative peoples, forces, and carriers. Westernization was not a predefined process predetermined by structures extraneous to the will of the historical subjects. Rather, it was a spontaneous process, resulting from the ability of individuals to choose appropriate forms of cooperation, recede into isolation when they considered it necessary, or selectively choose the offers coming from abroad. Thus I have not tried to explain how Latin America became Westernized. Instead, I wanted to understand how the subcontinent and the rest of the world invented a trajectory that made the subcontinent converge with Iberia, Europe, and the West, highlighting the reciprocal influences in the process. I wanted to focus on the process, not on Latin America’s assimilation of European and North American standards. I wanted to show how the Latin Americans and the rest of the world promoted their convergence through actions, organizations, laws, political forces, and economic and social mechanisms, which brought about Westernization. In substance this book is unlike most studies on the subject, which focus on which Iberian, European, or North American aspects have been internalized by the subcontinent, which most studies view as a passive subject that merely endured Westernization.

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B i b l io g r a p h y

This work is the result of a decadeslong endeavor to understand the processes of intersection, convergence, and divergence between the European and the Latin American world, to reconstruct the logic underlying these processes, and, finally, to analyze the historical forms that Westernization took on the Latin American subcontinent. I tried to flesh out this interest by tracing a path that could wed reflection and historical research to contributions from the social sciences. Even in my earlier publications I tried to link the different historical dimensions of human activity, from economics to politics, from society to institutions and culture. My studies of the colonial and contemporary history of Latin America, listed here, gave me the opportunity to think comparatively about American and European history and critically review the existing historical paradigms and mythologies about the Old and the New World. This epistemological effort has implied a constant comparison of American and international spaces and of world historiography and American historiography. The analytical pattern developed in this volume follows the pattern of my publications since the 1980s; it is an effort to study in depth a broad historical issue, such as the dynamics of Indian colonial societies or the relationship between finance and liberal public policy, keeping in mind published and unpublished sources and the unique nature of the national or regional realities being studied, while comparing my information with knowledge about other areas. Following this method, I was able to weave analysis and synthesis, thus, I hope, going beyond a purely descriptive narrative. In honing this multifaceted approach that implicitly compares Latin American realities with those of Europe and the West, I have been greatly aided in editing and preparing for publication the following eight works on the general history of the Latin American areas: 285

Carmagnani, M., C. Gibson, and J. A. Oddone, eds. Storia dell’America Latina. Turin, 1976. Carmagnani, M., ed. L’America Latina dal ’500 ad oggi. Nascita, espansione e crisi di un sistema feudale. Milan, 1976. ———, ed. Storia dell’America Latina. Vol. 6 of N. Tranfaglia, ed., Il Mondo Contemporaneo. Florence, 1979. ———, ed. La grande illusione delle oligarchie. Stato e società in America Latina. Turin, 1981. Carmagnani, M., et al., eds. America Latina: dallo stato coloniale allo stato nazione. 2 vols. Milan, 1987. Carmagnani, M., and G. Casetta, eds. America Latina: la grande trasformazione. Turin, 1989. Carmagnani, M., A. Hernández Chávez, and R. Romano, eds. Para una historia de América. Estructuras y nudos. 3 vols. Mexico City, 1999. Romano, R., and M. Carmagnani, eds. Nova Americana. 5 vols. Turin, 1978–82. Finally, the bibliography lists only the most recent studies up to 2001, especially about the subcontinent as a whole, that I believe are important for understanding the process of Westernization. I have organized the bibliography in two chronological parts. The first covers the period from the empire to the crisis—that is, from the fifteenth to the eighteenth century; the second, the period from independence to the present day. Each part is further subdivided by four themes: the international context, economies, societies, and institutions and policies.

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Italic page numbers indicate maps. Alliance for Progress, 208, 209, 212, 225, 230 Almagro, Diego de, 20, 37 Alvarez, Juan, 129 Amazon region, 18 American Revolution (1776), 58, 87, 89, 101, 137, 277 Amerindians. See Indians, American Amnesty International, 5 anarchosyndicalism, 178 Andean Nations’ Community, 220 Andean Pact, 212 Andean region, 16, 17, 32, 38, 66; administrative seats, 45; ayllu (clan system), 18; biethnic society in, 47; disease epidemics in, 37; independence movements, 108, 109; Indian languages preserved in, 77; Indian politicians in, 127; native languages of, 276; rebellions, 80. See also Inca Empire animals, domestication of, 16 Antilles. See Caribbean (Antilles, West Indies) islands Arabs, 22, 23, 24

Abascal, José de, 108 absolutism, 30, 35, 53, 79, 126; in Brazil, 60; guilds as obstacle to, 63; independence movements combatted by, 104; late appearance in Spanish America, 59; repression of Túpac Amaru and, 82, 83; resistance to, 59, 60 Adams, John, 95, 97 Adenauer, Konrad, 212 Africa, 2, 3, 168, 210, 246; Berlin Conference and, 145; Cuban presence in, 213; entrepôts in, 26; European colonialism and, 195, 200, 273; Iberian expansion in, 24; slaves brought from, 42, 43; United Nations and, 211; on world maps, 7 agriculture, 37, 38, 44, 151, 152; diversification of, 114; map of production areas, 40–41; nationalization of, 224; neolithic revolution and, 16; productivity of, 226 Aix-la-Chapelle, conference of (1818), 93 Aix-la-Chapelle, Peace of (1748), 57 Alamán, Lucas, 98, 126, 128 Alberdi, Juan Bautista, 125, 128, 167 aldeas (villages), 71

301

Argentina, 6, 18, 132, 188, 236; British trade with, 155, 202; caudillos in, 128; centralization in, 268; constitution, 91; Contadora Group and, 220; democracy in, 254, 265, 266; economic modernization, 162– 63, 167; economy, 152, 153, 157, 160, 227, 238, 239; education investments in, 233; electoral system, 123, 183, 184, 257; European immigration to, 142, 168, 170, 278; in Falklands-Malvinas War, 265; federal power in, 269; foreign policy of, 147; frontier colonization in, 142; human rights violations in, 213; illiteracy rate, 246; in Mercosur, 220; military forces, 144, 187, 190, 217–18, 262; political parties, 186, 260, 261; population growth rate, 248; populist economics in, 223; presidential power in, 270; privatization in, 237; public opinion in, 256; in Second World War, 203, 280; secularization in, 245; standard of living index, 248; Túpac Amaru rebellion reaching, 82; urbanization in, 173, 250, 251 Asia, 2, 6, 210, 246; immigrants to New World from, 168; European expansion into, 195, 273; United Nations and, 211; on world maps, 7 Atahualpa, 20 Atlas Major (Blaeu), 7 audiencias (juridical bodies), 27–28 Augustinian order, 33 Australia, 160, 168 Austria, 92, 93, 139 autonomist movements, 103–4 ayllu (clan system), 18–19 Aymara people/language, 78, 82 Azores, 24, 25 Aztec Empire, 16, 18, 19, 25; conquest of, 31; human sacrifice practiced in, 20; religion, 19; smallpox and fall of, 37; Spanish conquest of, 20. See also Mesoamerica; Mexico Baden, Treaty of, 8 Bahia, 31, 51; captaincy general of, 59; commercial routes and, 68; merchant guilds, 44; plantations in, 42; population growth, 71; social differentiation 302

index

of, 120; sugarcane production, 39; “tailors” conspiracy, 83 Bajío movement, 106 banks, 8, 63, 100, 164–65; birth of financial economy and, 156; British and European, 101, 148, 157, 159; merchant, 157–58 Bastos, Antônio Tavares, 125 Belgium, 155, 160 Belgrano, Manuel, 84 Benzoni, Gerolamo, 27 Berbeo, Francisco, 81 Berenguer, Sancho de Bitencourt, 119 Berlin Conference (1884–85), 145, 154 blacks (Afro-Americans), 61, 130, 266–67 Bogotá, city of, 72, 124, 235, 249, 250, 252 Bolívar, Simón (El Libertador), 104, 105–6, 107, 109 Bolivarian Alternative for Our People’s America, 220 Bolivia, 38, 66, 127, 220, 254; ayllu (clan system), 18; cabildos (municipal councils) of, 89; centralization in, 268; in Chaco War, 203; democratization in, 265; illiteracy rate, 246; Indian population, 173, 177; military forces, 187, 262; in Pacific War, 142, 144; political parties, 261; population growth rate, 248; populist economics in, 237; rebellions, 79; revolution (1952–56), 2, 208, 245, 267; in Second World War, 203; silver production, 157; urbanization in, 173. See also Upper Peru Bonaparte, Joseph, 85, 87, 88 Bonaparte, Napoleon. See Napoleon I border disputes, 141–42, 147, 204 Bourbon dynasty, 56, 78, 79, 85, 102, 106. See also Spanish monarchy bourgeoisie, 136, 177, 179, 200, 280. See also class system Boyacá, Battle of, 109 Brazil, 66, 133, 152, 157; authoritarian rule in, 257, 259–60; Braganza monarchy in, 126, 138–39; British trade with, 155; câmaras municipais (municipal governments), 45, 49–50, 75; centralization in, 268–69; citizenship in, 131; commodities produced in, 116; constitutionalist movement, 110–12; Contadora Group and, 220; democratization in, 265; develop-

ment of economy, 44; donatários, 21, 23; Dutch rule in, 50–51; economy, 160, 161, 163, 227, 238, 239, 241; education investments in, 233; electoral system, 122, 132, 183, 184, 257; European immigration to, 142, 168, 170, 171, 278; as federal nation, 188; free trade policy and, 100; French incursion into, 28, 31; frontier colonization in, 142; illiteracy rate, 246; Indians devastated by Portuguese invasion, 29; as leading country in future, 6; legal system, 47; in Mercosur, 220; military forces, 144, 190, 217–18, 262; mining in, 65, 67, 114; as monarchy, 93, 94; nobility of, 119– 20; plantations in, 42; political parties, 260, 261; population growth rate, 248; populist economics in, 223; Portuguese discovery of, 25; Portuguese monarchy transferred to, 85, 87, 91; public opinion in, 256; rebellions in, 83; regional tensions in, 134; as republic, 138, 267; royal reforms in, 59–60; in Second World War, 203; secularization in, 245; standard of living index, 248; sugarcane production, 66– 67; urbanization in, 173, 251; yerba maté in, 70 Bretton Woods Conference (1944), 206, 228, 229, 231, 242 brotherhoods, 2, 62, 72, 77, 127, 174 Bry, Theodore de, 27 Buenos Aires, 39, 42, 100, 121, 129, 135; British attack on, 87; cabildo of, 76; as colonial territory, 31; commercial routes and, 68; commodity exports from, 116– 17; economic expansion and, 113; French interventions in, 97; income distribution in, 235; junta government in, 89; PanAmerican conference in, 146; population growth, 72, 252; stock exchange, 165, 239 Bulcão, Joaquim de Araújo Aragagão, 119 bureaucracy, 35, 50, 57, 75, 122 Caballero y Góngora, Archbishop, 81 cabildos (municipal councils), 27, 45–48; corporatist roles of, 59; extended (abierto), 81; informal colonial pact and, 75–76; officials appointed by, 88–89; royal supervision of, 56  

Cabral, Pedro Alvares, 25 cacao, 42, 70, 75, 116, 117 caciques (native chiefs/leaders), 19, 45–46, 261–62, 267 Cádiz constitution (1812), 90, 92, 107, 111 calpulli (clan system), 18–19 Calvo, Carlos, 197 Calvo-Drago Doctrine, 149, 197, 201 câmaras municipais (municipal governments), 45, 49–50, 75 Canada, 134, 160, 167, 168, 214; G-7 and, 218; NAFTA and, 220 Canary Islands, 24–25 Canning, George, 95–96 Cape Verde Islands, 26 capitalism, 4, 199, 210, 244 capitulaciones contracts, 30, 31–32, 45 Capitulations of Santa Fe, 25 Carabobo Constituent Congress, 109 Caracas, city of, 71, 72, 121; absolutist restoration in, 104; growth rate, 124, 250; junta government in, 89 Cárdenas, Lázaro, 203 Caribbean (Antilles, West Indies) islands, 10, 15, 168, 265; British possessions, 58, 96–97; Columbus’s landing in, 25; Council of the Indies, 30; crops cultivated in, 16; Dutch presence in, 56; first Iberian invasion of, 25–28, 33; in Second World War, 203; settlements granted recognition in, 71; sugar production, 38; in U.S. sphere of influence, 142, 143, 147, 148–49 Caribbean States Association, 220 Caricom (Caribbean Common Market), 220 Carranzo, Venustiano, 269 Carter, Jimmy, 213 Casa da Índia e da Guiné, 26, 44 Casa de Contratación de las Indias, 26, 45 Castile, 21, 35; legal traditions of, 30; noble families of, 22, 23; rebellion of cities in, 27; union with Aragon, 22, 29. See also Spain Catholic Church, 10, 11, 38, 46, 121, 280; Americanization of, 73–74; cabildos (municipal councils) and, 48, 49; clientelism and, 245; concern for Indians, 27, 28, 36; conquistadors’ service to, 22; index

303

Catholic Church (continued) diminished power of, 57; dispute with independent states in Latin America, 93; education and, 77; Enlightenment and, 83–84; independence movements and, 105; Latin American sovereignty and, 93, 97–98; monastic orders, 33; privileges of, 79; properties of, 117; royal reforms and, 86; secularization and, 182, 247; social doctrine of, 246; social institutions and, 72, 174; Spanish monarchy and, 72; syncretism and, 52, 73, 128; treaties of Westphalia and, 54; Westernization and, 53 caudillos (leaders), 27, 125–26, 128, 188, 269 censorship, 79, 182 Central America, 16, 18, 38, 66, 254; authoritarianism in, 255; cities founded in, 71; Contadora Group and, 219–20; military rule in, 262; in Second World War, 203; U.S. expansionism and, 142, 148–49 Central-American Common Market, 212 centralization, political, 267–68 Charles III, king of Spain, 57, 74 Charles IV, king of Spain, 88 Charles V, emperor, 21, 26, 30; conquistadors’ reports to, 33; empire of, 29; rebellion of Castilian cities and, 27; territorial councils and, 35 Chibcha civilization, 16 Chile, 6, 18, 31, 66, 132, 210; autonomist movement, 104; border disputes of, 147; British trade with, 154, 155; citizenship in, 130; colonization of, 20; commercial routes and, 68; conquest of, 32; constitution, 91; copper production, 117; democracy in, 254, 265; depopulation in, 38; economy, 113, 152, 153, 160, 161, 162, 227, 239; education investments in, 233; electoral system, 122, 184, 257; European immigration to, 142, 168; foreign policy of, 147; free trade policy and, 100; frontier colonization in, 142; human rights violations in, 213; independence of, 108; military forces, 144, 187, 190, 218, 262; mining regions, 65, 67; in Pacific War, 144; political parties, 186, 260, 261; populist economics in, 223; power policy in South Pacific, 139; privatization in, 237; 304

index

public opinion in, 256; rebellions, 80, 81; regional tensions in, 134; republican government in, 126; rural land ownership in, 118; in Second World War, 203, 280; settlements founded, 71; silver production, 157; socialist-populist government, 212– 13; urbanization in, 173, 251; voluntary associations in, 175; yerba maté in, 70 China, 5, 6, 7, 8, 204, 219 citizenship, 90, 129–31, 174, 181, 182, 184, 257 city-states: American Indian, 16, 18; Hanseatic, 94, 96; Italian, 6, 24 civil service, 258 Civil War, American, 96 class system, 66, 120–23; education and, 133; lessening of antagonism, 256; political action and, 255; redefinition of social components and, 176–80; secularization and, 244–45 clientelism, 22, 47, 69, 255; caciques and, 267; commerce as way out of, 69; constitutional guarantees and, 261; European class concepts and, 63; secularization and, 245–46; urbanization and decline of, 249 cochineal, 39, 44, 70 coffee, price of, 115–16 cold war, 204, 205–6, 208–9, 219, 280; end of, 214; map of bloc alignments, 215 Colombia, 18, 66, 152, 153; Bolívar in, 105; border disputes of, 141; British trade with, 154; caudillos in, 128; centralization in, 268; in Contadora Group, 219; democratic values in, 254; economy, 113, 239; education investments in, 233; electoral system, 123, 257; European immigration to, 142, 168; independence of, 95; “palm tree republics” in, 75; Panama separated from, 149; political parties, 260; population growth rate, 248; rebellions, 80, 81, 245; regional tensions in, 134; republican government in, 126; in Second World War, 203; urbanization in, 173 colonialism, 12, 145, 146, 194, 243, 278 colonization, first period of, 10, 14, 36–39, 42–44, 275 colonization, second period of, 10–11, 66, 71, 276

Columbus, Christopher, 14, 16, 25–27, 31, 37 commercial routes, 40–41, 44, 65, 67–68, 69 common law, 2, 30, 52 communication, 3, 5, 272; economic modernization and, 166; financial economy and, 158; literacy and, 246; new forms of, 12; new technologies of, 155; plurality of networks, 281; technological changes in, 216; urban networks and, 172 communism, 186–87, 205, 271; in China, 208; coalition politics and, 260; national sovereignty and, 225; in Western Europe, 210. See also Soviet Union (USSR) Community of Latin American and Caribbean States, 220 Comunero Rebellion, 81, 84, 106 conquest, Iberian, 10, 33, 275, 282 conquistadors, 14, 21; alliances with Indians, 20, 32; in Canary Islands, 24–25; capitulaciones and, 30; conflicts with vecinos, 46; descendants of, 65; dwindling prestige of, 38; Indian uprisings against, 27; noble titles of, 22; ruthlessness and violence of, 33 constitutions/constitutionalism, 6, 90–91, 106; in Brazil, 110–12; growing acceptance of, 125, 137; institutions and, 261– 67; liberal, 182–83; in Mexico, 133, 263– 64; nationalism and, 196; number of constitutions drawn up, 127; powers of government, 188; reform of monarchies and, 102; in Río de la Plata, 135; secularization and, 124; Western cultural tradition and, 150 Contadora Group, 219–20 contraband, 5, 44, 56, 276 copper, 113, 117, 141, 155, 171 corporatism, 46, 63, 187, 198, 268; breakdown of, 172; cabildos (municipal councils) and, 59; end of, 174; erosion of social criteria of, 120; idea of freedom and, 88; Nazi-Fascist, 195; new nations’ break with, 277; persistence of, 112; statism and, 279; transition to class-based society, 119 corregidores/corregedores (royal commissioners), 49, 50, 75, 76, 82

Cortes (parliament), 23, 30, 48; American participation in, 90, 129; independence movements and, 106, 110; Portuguese, 91, 92, 111–12, 129; Spanish America and, 76, 89; three estates represented by, 35, 89 Cortés, Hernán, 20, 21, 32, 33–34, 37, 65 Cortés, Martín, 30 Costa Rica, 153, 207, 208; democratic values in, 254; electoral system, 257; political parties, 261 Council for Mutual Economic Assistance, 211 Council of the Indies, 29, 30, 35, 50 Creoles (American-born Spaniards), 49, 58, 88, 102; affirmation of Creole identity, 77; “colonial covenant” and, 277; corporatism and, 63; defense of Buenos Aires and, 87; hostility to absolutism, 59; in independence movements, 110; Indian allies of, 127; international political culture and, 133; malaise under Spanish monarchy, 89; offices withheld from, 73–74; reformist, 103 Crimean War, 138, 146 Cromwell, Oliver, 55–56 Cuba, 66, 148, 218, 254, 262; economy, 153; exclusion from OAS, 211; international price of sugar and, 202; missile crisis (1962), 210; population growth, 72, 248; presence in African countries, 213; Revolution (1959), 205; settlements founded, 71; as single-party state, 259; in Soviet bloc, 22; sugar exports, 116; urbanization in, 251 Cuitláhuac, 37 Cuzco, city of, 17, 19, 34, 39, 108  

decolonization, 209, 210, 211 democracy, 235, 254; public opinion in support of, 256–57; spread of, 214, 255; transition from military rule, 265 Denmark, 96, 100 dependency theory, 4 Díaz, Porfirio, 189 diplomacy, 147, 218 disease epidemics, 29, 37, 46, 172 Dominican order, 33 index

305

Dominican Republic. See Santo Domingo (Hispaniola, Dominican Republic) donatarias (royal donations in Brazil), 23, 31, 32, 45 donatários (recipients), 21, 31, 50, 51 Drago, Luis M., 197, 198 drug trade, 221, 266 Echeverría Alvarez, Luis, 241 economy, international, 44, 65–70, 98– 101, 150, 152–56, 221; birth of financial economy, 156–61; decades of optimism (1945–70s), 225–27; deferred trade system, 202; as defining element of power, 142; fragility of financial system, 238–43; imbalances in, 227–31; industrial and fiscal challenges, 112–18; modernization of, 161–67; performance and productivity trends, 231–34; populist economics, 221– 25, 230, 240; savings and investments, 234–38; Wall Street crash (1929), 198, 223 Ecuador, 18, 66; border disputes of, 141, 204; cacao production, 70; centralization in, 268; citizenship in, 131; democratization in, 265; economy, 153; in Gran Colombia, 109; Indian politicians in, 127; military forces, 262; political parties, 261; populist economics in, 237; rebellions, 79, 80, 81; in Second World War, 203; urbanization in, 173 education, 77, 78, 122; Catholic, 247; investments in, 233; new political subjects and, 180–81; political class and, 133; secularization and, 246, 247 Eisenhower, Dwight D., 208 elections/electoral laws, 122, 123, 130–33, 183–84, 254, 257 El Salvador, 153, 213, 246, 262, 265 encomenderos (recipients of Indian tribute), 32, 45, 47 encomiendas (tributes), 23, 38 Enlightenment, 84, 90, 97, 106 ethnic groups, 45, 277; in American Indian societies, 20; assimilation of, 12; Catholic Church and, 98; Iberian values absorbed by, 51; national unity and, 141; rights and duties of, 46 Eurocentrism, 274 306

index

Europe, 2, 15, 126; American world’s openness to, 86; collapse of Soviet bloc and, 217; competition among powers, 148; Concert of Europe idea, 137–38, 146; diverging path from China, 8; emigration from, to New World, 167, 168, 169, 170–71, 278; international order and, 139–40; Latin America viewed in, 145, 194; liberal democracy in, 214; Mediterranean, 136, 142, 150, 154, 170; negative view of Latin American independence, 92; new colonialism of, 12; post-Napoleonic Restoration, 85, 92, 93; postwar relations with Latin America, 212–13; public culture in, 84; rebirth after Second World War, 209; second industrial revolution in, 156; secularization in, 55; suffrage in, 132; trade with Latin America, 99; on world maps, 7 European Economic Community, 227 European Union, 217, 218, 219, 266 everyday life, 4, 112 executive branch (presidency), 134, 185, 188; congress and, 132, 183, 189; presidentialism, 269–71; strong, 107; totalitarian doctrines and, 198–99; weak, 104, 105, 135 Export-Import (Ex-Im) Bank, 202, 203, 206, 225 Falklands-Malvinas War, 265 family, transformation of the, 245 fascism, 145, 198, 200 federalism, 188–89, 268–69 Federal Loan Agency, U.S., 202 Ferdinand VII, king of Spain, 87, 88, 92, 105 fidalgos (Portuguese nobles), 22 Florence, city-state of, 24 Food for Peace, 225 Four Continents Fountain (Trieste), 7 Fox, Vicente, 259 France, 55, 93, 96, 139; alliance with Spain, 87; Brazil’s relations with, 94; colonial empire of, 200; economic competition and, 154; European coalitions against, 91; financial/commercial presence of, 147; G-7 and, 218; incursion into Brazil, 28,

31; interventions in Mexico, 97, 181, 278; privateering/piracy and, 56; reorganization of empire, 57; settlements in Brazil, 20; Spanish reconquest of former colonies and, 107; trade with Latin America, 155; United Nations and, 204. See also French Revolution Franciscan order, 33 Franco, Francisco, 198 freedom, political, 86–92 “free riders,” historical subjects as, 5 free trade, 84, 150, 278; financial economy and, 159; infrastructure and, 112; Latin American industrialists and, 153; rebellions and, 82, 83; results of, 100; in Western Hemisphere area, 220; Westernization and, 86 French Revolution, 85, 87, 89, 101; changes in international order and, 277; monarchy identified with despotism, 93, 94; national idea and, 137; popular representation and, 90 Gabriel Condorcanqui, José, 82 Gama, Vasco da, 25 Garay, Juan de, 32 Gaulle, Charles de, 212 General Agreement on Tariffs and Trade (GATT), 218, 226, 242, 259 Genoa, city-state of, 24, 45 Germany, 138, 139, 144; balance of power and, 147; economic competition and, 154; expansionism of, 200; G-7 and, 218; Latin American countries and, 142; Nazi, 150, 198, 202, 280; trade with Latin America, 155 globalization, 3, 148, 193, 219, 242, 280–82; comparative approach to history and, 273; global localization (glocalization), 216; internationalization and, 12, 279; public opinion against, 214 gold, 27, 38, 68; in Brazil, 67; on Santo Domingo, 25–26; slave labor in mining of, 114 gold standard, international, 137, 156; crash of 1929 and, 198; demise of, 279; financial economy and, 158–59, 160; First World War and, 161; U.S. break with, 212

Goldstone, Jack, 5 Gómez Farías, Valentín, 125 Good Neighbor policy, 200, 203, 205, 225 governments, 187–91 Granada, reconquest of, 22, 24 Gran Colombia, 109 Great Britain (England), 55–56, 57, 200; American colonies of, 58; anti-French coalition and, 92; as arms supplier, 144; Brazil’s relations with, 94, 95; colonies in North America, 93; commercial relations with Latin America, 94–96; expansionist designs in South America, 87; in Falklands-Malvinas War, 265; financial economy and, 156–59, 164; German challenge to hegemony of, 138; G-7 and, 218; hegemony in Latin America, 147–48; Latin American sovereignty and, 93, 146– 47; London money/capital market, 100, 117, 164; as minor country, 6; Portuguese constitutionalism and, 91; privateering/ piracy and, 56; Spanish reconquest of former colonies and, 107; trade with Latin America, 100–101, 154–55, 164, 202; United Nations and, 204; U.S. rivalry with, 96–97 Gronchi, Giovanni, 212 Group of Three, 220 Guarani Indians, 29, 47 Guatemala, 42, 66, 144, 250; democratization in, 265; economy, 153; free trade policy and, 100; illiteracy rate, 246; Indian population, 177; military rule in, 265; revolution (1954), 208, 245 guilds, 63, 102, 127, 157. See also merchant guilds Guipuzcoana company, 75, 80 Hague Conference (1898), 146 Haiti, 58, 83, 87, 111; Bolívar supported by, 109; conflict with Dominican Republic, 207; human rights violations in, 213; military rule in, 265; population growth rate, 248; U.S. occupation of, 149, 201 Hapsburg monarchy, 50, 59 Havana, city of, 72, 124, 146 Hidalgo, Miguel, 106 hidalgos (Spanish nobles), 22–23, 24 index

307

history and historians, 1–2, 136, 273, 274; engines of, 2–6; multidisciplinary approach to, 10; national and international dimensions of, 8–9 Hobbes, Thomas, 83 Hofman, A. H., 232 Holy Alliance, 107 Holy Roman Empire, 21, 54 Honduras, 144, 207–8, 262; democratization in, 265; economy, 153; illiteracy rate, 246; military rule in, 265; political parties, 260 Huáscar, 20, 34 Huayna Capac, emperor, 20 Huerta, Victoriano, general, 149 human rights, 174, 213 human sacrifice, 20, 28–29 Humboldt, Alexander von, 63 hunter-gatherers, 16, 17–18 Huskisson, William, 95 Iberians: Americanization of, 38, 77; background of invaders, 21–24; belief in superiority over Indians, 36; “colonial freedom” and, 276; españoles pobres, 32; immigration into New World, 43; local vision of history and, 15 Iberian Union, 29–30, 55 Ibero-Americans, 11, 36, 46, 67, 81 illegitimacy, 61, 63, 64 immigration, 12, 43, 168, 170–71, 221; banks and, 159; global patterns of, 169 imperialism, 136, 145, 149, 199 Inca Empire, 16, 18, 19, 20, 34, 38 independence, Latin American, 80, 84, 107–12, 182; economic advantages of, 99; effects on everyday life, 85–86; ideas associated with, 87; legitimist and autonomist movements, 101–7; national idea and, 15, 139; new states in international context, 92–98; Restoration in Europe and, 92; wars of, 108–9, 118, 126, 277 India, 25, 167, 195 Indians, American, 10, 53, 177, 266–67; adaptations during invasion phases, 34; alliances with Iberians, 32; border disputes and homelands of, 141; “colonial covenant” and, 277; common law of, 30; 308

index

destruction of, 14; European disease epidemics and, 29, 37, 46; first contact with Europeans, 275; Franco-Portuguese clashes and, 28–29; genocide of, 36–37; head tax on, 80; history and society before Iberian invasion, 15–20; Iberianization of, 77; languages of, 77, 78, 276; local vision of history and, 15; low birthrates, 61; as majority, 124, 173; politicians after independence, 127; population decline, 37–38, 43; Protestant churches and, 247; resistance to invasion, 27; social status sought by, 69; tributes paid by, 32, 45; as vecinos, 73 indigo, 42, 70 individualism, 175, 246, 253, 254 Indonesia, 195 industrialization, 120, 159, 173; financial markets and, 243; import substitution and, 227, 259; world economic crisis and, 199 industrial revolution, second, 11, 156 inflation, 222, 227, 236, 240, 241, 242 ingenio plantations, 66–67 Inter-American conferences, 201, 203, 206, 208 Inter-American Development Bank (IDB), 208, 209, 225, 230 International Court of Justice, 145, 146 internationalization, 11, 12, 13, 279 international law, 9, 88, 94, 197 International Monetary Fund (IMF), 9, 206, 211, 225, 227, 228–29 international relations, 2–3, 8, 12 Internet, 216, 280, 281 Isabella, queen of Spain, 22, 25 isolationism, 146, 193, 242, 253–54, 274 Italy, 138, 139, 194; commercial importance of, 147; economic competition and, 154; emigration to New World from, 168, 170; expansionism in Africa, 200; Fascist, 150, 198, 202, 280; gold standard and, 160; G-7 and, 218; Italian city-states, 6 Iturbide, Agustín de, 110  

Jacobinism, 87, 103 Japan, 6, 139, 198, 209, 218, 219; British alliance with, 140; collapse of Soviet bloc

and, 217; expansionism of, 200; greatpower status of, 138, 194; G-7 and, 218 Jesuits, 47, 78 Jews, in Spain and Portugal, 24 John V, king of Portugal, 57 John VI, king of Portugal and Brazil, 87, 91, 92, 110, 111 Joseph I, king of Portugal, 57 Junta Suprema Central, 88, 89 Kennan, George, 206 Kennedy, John F., 208, 209, 211 knights, Spanish, 22, 23 Korea, South, 5 labor unions, 244, 245, 258, 259, 264, 270 landowners, 47, 75, 121, 176, 185; in Brazil, 123, 133; paternalism of, 43–44; titles of nobility and, 119 Lastarria, Victorino, 125 latifundios, 42, 114–15, 118, 176–77 Latin American Free Trade Association, 212 law. See common law; international law Laws of Burgos, 28 League of Nations, 140, 144, 145, 147, 196, 201; ineffectuality of, 198; Latin American nations in, 196–97 Lend-Lease Act, 202–3 Leo XII (pope), 98 liberalism, 6, 86, 125, 137; Anglo-Americanism, 195; Catholic Church opposed to, 98; constitutionalism and, 91, 182–83; in Cortes, 90; democratic, 178; individualism and, 246; nationalism and, 179, 182; republicanism and, 181, 182; Western cultural tradition and, 150 Lima, city of, 39, 42; cabildo of, 49, 76; commercial routes and, 68; growth rate, 124, 250; Jesuit college, 78; merchant guilds, 44; population growth, 249; San Martín in, 108–9; voluntary associations in, 174 Lima Conference (1864–65), 146 Lisbon, city of, 24 literacy and illiteracy, 77–78, 180, 246, 248 livestock, 42, 67, 114; number of workers handling, 113; semiwild, 34, 68; spread of, 40–41, 43

localism, 127 Locke, John, 83 London Conference (1830–23), 145 López Portillo, José, 241 Lutheranism, 54 Madeira, 24 Madero, Francisco I., 149 mamelucos (mixed-race Brazilians), 29 Man without Qualities, The (Musil), 5 Masonic lodges, 175, 181 Mastai-Ferretti, Giovanni, 98 Maya civilization/language, 16, 19, 78 merchant guilds, 44, 46, 59, 67; of Buenos Aires, 64; buildings of, 63; municipal agents and, 76 Mercosur, 220, 259 Mesoamerica, 16, 17, 38; administrative seats, 45; biethnic society in, 47; calpulli (clan system), 18; demographic growth in, 37; Indian languages preserved in, 77; native languages of, 276; rebellions, 80. See also Aztec Empire messianism/millenarianism, 80, 82, 178 mestizos, 29, 42, 47, 48, 53, 214; in agricultural areas, 66; in Cuba, 66; defined as white, 62; draft extended to, 59; farming areas of, 44; social status sought by, 69; as vecinos, 73. See also mixed-race unions Mexican Revolution, 2, 149, 178, 186, 245, 267 Mexico, 6, 31, 234, 236; agrarian reform, 268; British trade with, 154; Cádiz constitution of 1812 in, 107; calpulli (clan system), 18; caudillos in, 128; centralization in, 268; conquest of, 20, 30, 32; constitution (1824), 133; constitution (1917), 263–64; in Contadora Group, 219; democratic values in, 254; economy, 44, 113, 152, 153, 160, 161, 162, 238, 239, 241, 242–43; education investments in, 233; electoral system, 123, 130, 132, 183, 184; emigration from, to United States, 171; European immigration to, 142, 168; as federal nation, 188; free trade policy and, 100; French interventions in, 97, 181, 278; illiteracy rate, 246; independence of, 95, 109–10; Indian population, 127, 177; index

309

Mexico (continued) Maximilian’s empire defeated in, 138; mining regions, 65, 67; NAFTA and, 220; oil industry nationalization, 203; political culture and parties, 133, 134– 35, 186, 259, 261, 269; population growth rate, 248; populist economics in, 223; power politics and, 144; presidential power in, 270; privatization in, 237; public opinion in, 256; rebellions, 79, 80–81; regional tensions in, 133–34; republican government in, 126; in Second World War, 203; secularization in, 245; silver production, 38, 113–14, 157, 160; standard of living index, 248; urbanization in, 173, 251; U.S. sphere of influence and, 142, 143, 148, 149, 196; Zapatista movement, 16. See also Aztec Empire; Mesoamerica Mexico City, 44, 78, 121; autonomist movement in, 106; cabildo (municipal council) of, 49, 76, 102; commercial routes and, 68; growth of, 124, 178, 250; income distribution in, 235; Pan-American conference in, 146; population growth, 249, 252; social differentiation of, 120, 121, 123; stock exchange, 239, 241, 243 middle class, 176, 179, 181, 195, 200, 255. See also class system militias, 73, 127, 129; defense of Buenos Aires and, 87; mixed-bloods and, 59, 63; professionalization of, 60; transformed into national guards, 122 mines/mining, 37, 38, 66, 117; British-owned companies, 113–14; high-technology, 151, 152, 177; map of production areas, 40–41; mine owners, 47; miners’ guild, 63, 76; nationalization of, 224; organization of labor in, 122; paternalism of owners, 64. See also copper; gold; silver Miranda, Francisco, 105 mixed-race unions, 11, 29, 47–48, 276; categories of, 47; class conflict softened by, 245; demographic growth and, 61–62; social rank and legal status of, 62–63. See also mestizos; mulattos Mixtec people/language, 20, 78 Moctezuma, 33 modernity, 88, 112, 145, 281 310

index

modernization, 192, 214, 226, 236 monarchies, Iberian, 2, 85, 125; absolutist tendencies, 11; Americas annexed to, 15, 35–36; “colonial covenant” and, 276–77; colonization promoted by, 38; decline of, 53–56; fiscal needs, 67; free-trade policies, 86; Napoleonic interruption of, 87–88; parliaments and, 23; renewal of, 56–60; territorial councils of, 29–30, 35; transition from medieval to modern, 21. See also Portuguese monarchy; Spanish monarchy monarchy, constitutional, 92, 110, 112, 125, 126 monopolies, royal, 26, 31, 45, 60, 276; commercial routes and, 44; contraband and, 5; Noronha, 28 Monroe Doctrine, 97, 146, 148, 197, 200 Montesquieu, Baron de, 83 Montevideo, city of, 245, 249 Moors, 25 Morelos, José María, 106 mulattos, 47, 48, 53; citizenship concepts and, 130; constitutionalists in Brazil, 111; in Cuba, 66; defined as white, 62; draft extended to, 59; head tax on, 80; in independence movements, 109; as vecinos, 73. See also mixed-race unions multilateralism, 193, 205, 209, 213–21 Musil, Robert, 5 mutual aid societies, 2, 175 Náhuatl language, 78 Napoleon I, 87, 88, 91, 102 Napoleon III, 141 nationalism, 147, 150, 179, 194, 268; antiglobalization and, 213, 214; Brazilian, 29; constitutionalism and, 195–96; ethnonationalism, 210; “Good Neighbor” policy and, 203; individualism and, 246; local wars in South America and, 203–4; middle class and, 179; protectionism and, 224, 225; Third World, 205 nation-states, 12, 138, 204; decline of idea of, 210; globalization and, 280, 281; internationalization and, 279 “natural borders” doctrine, 142 natural resources, 61, 232, 264; border dis 

putes and, 141, 144; depletion of, 38; labor shortage and, 44, 66, 68, 115; traditional rights to, 244; underuse of, 43 natural rights doctrine, 182, 183 Nazism, 198, 200 neolithic revolution, 16, 17, 18 Netherlands (Holland), 6, 55–56, 96 New Deal, 20, 201 New Granada, 59, 71; autonomist movement, 104; in Gran Colombia, 109; rebellions, 81, 82, 106; Spanish reconquest of, 104. See also Colombia New Spain, viceroyalty of, 6, 33, 102; cabildos (municipal councils), 49, 76; commercial routes in, 68, 69; constitutional monarchy in, 110; independence movements, 106 New World, 10, 15, 145, 275; discovery of, 25; divided between Spain and Portugal, 28; Europeanization of, 68–69; first governmental bodies, 27; Iberians in, 21; renewed demographic growth, 61; royal administration of, 35; Westernization of, 51 Nicaragua, 149, 210; centralization in, 268; conflicts with other states, 207–8; democratization in, 265; economy, 153; illiteracy rate, 246; military forces, 262 nobility, American Indian, 15, 18–20, 32–33 nobility, Iberian and Ibero-American, 22– 23, 35, 55, 74, 89, 119–20 “no global” movements, 12, 214 nongovernmental organizations, 12 Noronha, Fernando, 28 North America, 2, 3, 53, 84, 93, 145 North American Free Trade Agreement (NAFTA), 220, 259 North Atlantic Treaty Organization (NATO), 207 nuclear weapons, 210, 217 Nueva corónica y buen gobierno [New Chronicle and Good Government] (Poma de Ayala), 34 O’Higgins, Bernardo, 108 oil crisis (1973), 212 oil industry, 203, 229, 278 Olivares, Count-Duke, 55

Oliveira Viana, Francisco José de, 75 Operation Pan-America, 208 Organization of American States (OAS), 207–8, 209, 213, 225, 258; creation of, 259; Cuba excluded from, 211; loss of importance of, 212 Otero, Mariano, 125 Pacific War (1879–83), 142, 144 Páez, José Antonio, 109, 129 “palm tree republics,” 75 Panama, 28, 31; commercial routes and, 68; in Contadora Group, 219; democratization in, 265; military rule in, 265; population growth rate, 248; separation from Colombia, 149 Panama Canal Treaty, 213 Pan-American conferences, 146, 149, 201 Paraguay, 32, 42, 103, 250; in Chaco War, 203; commercial routes and, 68; democratization in, 265; economy, 153; human rights violations in, 213; Jesuits in, 47; in Mercosur, 220; military forces, 262; political parties, 260, 261; settlements founded, 71; yerba maté in, 70 Paris, Congress of, 138 parties, political, 184, 186, 203, 235, 259–61 Patriotic Society, 105 patronage system, 122, 126, 128, 179, 182 patronato/padroado real, 93, 98 Paz, Octavio, 254 pearls, 27, 28, 38 peasants, 21, 127; education of, 180; industrialization and, 170; Mexican Revolution and, 178; nationalism and, 195; organized movements of, 175; right to land, 261; urbanization and, 249 Pedro, Dom (Pedro I), 111–12 peons/peonage, 43–44, 64, 67 Pérez Jolote, Juan, 177 Pernambuco, 31, 134; captaincy general of, 59; commercial routes and, 68; Dutch expelled from, 74; government of, 51; Jesuit college, 78; merchant guilds, 44; plantations in, 42, 74 Perón, Juan Domingo, 259, 269 Peru, 31, 66; ayllu (clan system), 18; border disputes of, 141, 204; British trade with, index

311

Peru (continued) 154, 155; caudillos in, 128; centralization in, 268; conquest of, 30, 32; Contadora Group and, 220; democratization in, 265, 266; economy, 153, 239, 241; electoral system, 122, 131, 184, 257; European immigration to, 142, 168; independence of, 109; Indian population, 127, 177; military forces, 144, 187, 262; mining regions, 67; in Pacific War, 142, 144; political parties, 261; population growth rate, 248; populist economics in, 223; privatization in, 237; rebellions, 79, 81; republican government in, 126; silver production, 157; smallpox in, 37; Túpac Amaru rebellion, 106; urbanization in, 251; viceroyalty of, 6, 102–3, 104, 108 Philip II, king of Spain, 35 Philip V, king of Spain, 56 Piar, Manuel, 109 Pichincha, Battle of, 109 Piedmont and Sardinia, kingdom of, 96, 138 Pinochet, Augusto, 265 piracy, 56 Pitt, William, 87 Pius VII (pope), 98 Pius IX (pope), 98 Pizarro, Francisco, 20, 32, 37 Pizarro, Gonzalo, 30 Polanyi, Karl, 9 Poma de Ayala, Felipe Guamán, 34 Pombal, marquis of, 57, 74, 83 population growth, 115, 228, 248, 249, 251 populism, 214, 240, 253; economics and, 221–25; individualism and, 246; public opinion shaped by, 256; Westernization of politics and, 253–54 Portales, Diego, 128 Portugal, 2, 6, 10, 90; College of Nobles, 74; emigration from, to New World, 170, 171; Indians allied with, 20; legal system, 47; New World divided up with Spain, 28; nobility of, 21, 22, 23; reorganization of empire, 57; Spain united with, 29–30, 35, 36, 74; vagrancy outlawed in, 48 Portuguese language, 52, 69, 73, 77, 124 Portuguese monarchy: Braganza dynasty, 312

index

56, 126; Brazil’s economic contribution to, 60; Catholic Church and, 93, 98; as composite monarchy, 29; flight to Brazil, 87, 91; post-Napoleonic restoration of, 92; reforms of, 59–60, 79. See also monarchies, Iberian postmodernism, 9, 273 Potosí, city and region of, 38, 42, 56, 68, 82 power, balance of, 9, 57, 92, 136, 147; in cold war, 209; Concert of Europe and, 138; military and financial, 140; national sovereignty and, 279; populist constitutions and, 257 presidency. See executive branch (presidency) primogeniture, 65 privateering, 56 privatization, 237, 238 property rights, 92, 278; of British subjects/ merchants, 96; Cádiz constitution (1812) and, 90; of foreign entrepreneurs, 157; guarantee of, 150; labor shortage and, 115 protectionism, 206, 226, 229, 237, 242, 279; conflicts fueled by, 147; globalization and end of, 281; Good Neighbor policy and, 225; populist economics and, 224; price distortion and, 227 Protestant churches, 112, 245, 247 Prussia, 92, 93, 96, 138 public opinion, 12, 181–82; antiglobalization tendencies and, 214; of British investors, 101; emergence of, 84; EuroAmerican world and, 195; globalization and, 282; internationalization of, 216–17; national sovereignty and, 199, 278; populism and, 256; secularization process and, 246; Soviet Union and, 199; against United States, 200, 209, 212; in United States, 149 Puerto Rico, 148, 149, 153 Pueyrredón, Juan Manuel, 108 Quechua language, 78 Quito, city and province of, 78, 81, 89, 102, 103, 235 race/color, 12, 120, 181, 277. See also mestizos; mixed-race unions; mulattos racism, 221

railroads, 137, 144, 155, 162–63, 178, 278 ranchos, 66, 114 Rastaf, Treaty of, 8 Real Audiencia, 102 Real del Monte (mining company), 113–14 Recife, 39, 71, 134 Regency Council, 89 religion, 19, 21, 52, 79, 180, 254. See also Catholic Church; Protestant churches representation, political, 183–87 republicanism, 93–94, 110, 126 republics, unitary, 126, 134, 187, 188, 268, 269 Restoration, in Europe, 85, 92, 93, 181, 277; impact in Brazil, 111; Spanish reconquest of former colonies and, 107 Rio de Janeiro, 59, 76, 84, 134; coffee exports, 116; government of, 51; growth rate, 124, 250; Pan-American conference in, 146; population growth, 71, 249; Portuguese court in, 102; rebellion in, 83; social differentiation of, 123 Río de la Plata, 31, 59, 132; African slave trade in, 56; autonomist movement, 104; commercial routes and, 68; constitutional order in, 135; Cortes and, 129; development of economy, 44; free trade in, 88; independence of, 107–8; viceroyalty of, 103; yerba maté in, 47, 70 Roosevelt, Franklin D.: economic prosperity and policies of, 166; Good Neighbor policy, 149, 200, 201, 203, 225; liberaldemocratic politics of, 206 Roosevelt, Theodore, 146, 148, 196 Rosas, José María de, 129, 135 Rousseau, Jean-Jacques, 83 Russia, Imperial, 92, 93, 100, 107, 139, 140 Russia, post-Soviet, 218 St. John d’el Rey Mining Company, 114 Salamanca, University of, 78 Salazar, António, 198 Sandino, César Augusto, 149 San Martín, José de, 107, 108, 109 Santa-Anna, Antonio López de, 126 Santander, Francisco de Paula, 109 Santiago de Chile, 72, 81, 89, 121; cabildo (municipal council), 76, 104; growth rate,

124, 250; income distribution in, 235; Jesuit college, 78; Pan-American conference in, 146; population growth, 249; stock exchange, 165, 239 Santo Domingo (Hispaniola, Dominican Republic), 25–26, 31, 207, 208, 262; centralization in, 268; military rule in, 265; mining in, 39; plantations, 42; population crash after invasion, 28; revolution in French part of, 58; settlements founded, 71 São Paulo, 42, 71, 134; captaincy general of, 59; coffee exports, 116; commercial routes and, 68; economic expansion and, 113; growth rate, 250; population growth, 71, 249; social differentiation of, 120; stock exchange, 239, 241 Saragat, Giuseppe, 212 Sarmiento, Domingo, 125, 167 Second World Peace Conference (1907), 197, 201 secularization, 55, 119, 176, 243–44, 268; education and, 180; electoral campaigns and, 256; political effects of, 254; principal carriers of, 244–49; of social behavior, 175; urban society and, 249–53; Westernization and, 124 seigniories: in Brazil, 31, 50–51, 59, 65; Castilian, 24; of native civilizations, 16, 19 Seven Years’ War, 57 shantytowns, 250 sharecropping, 64, 114, 121–22 Sieyès, Emmanuel-Joseph, 90 Silva Xavier, Joaquim José da (Tiradentes), 83 silver, 36, 38, 42; as currency, 156, 160; economic changes and, 69–70; mining technology and, 113–14; price of, 67–68; quantity shipped to Europe, 45 Singapore, 5, 195 slavery/slaves, 43, 75; abolitionist movement, 278; attempt to enslave Indians, 42; in Brazil, 120; in British Caribbean islands, 58; in gold mines, 114; insurrections, 105, 106, 111; rebellion in Haiti, 83, 87; as remedy for labor shortage, 61; slave trade, 3, 24, 44, 56, 60; in Spain and Portugal, 24; in United States, 96 index

313

smallpox, 37 socialism, 178, 182, 186, 198; coalition politics and, 260; economics and, 222; individualism and, 246; public opinion and, 256–57; Soviet, 195, 199 social networks, on line, 216, 282 social sciences, 1, 10, 273 Soustelle, Jacques, 17 sovereignty, dynastic, 54, 94–95 sovereignty, national, 94, 95, 259; Catholicism and, 93, 97–98; “community of interests” and, 196; establishment of, 141–42, 143, 144–45; European Restoration and, 92; federalism and, 188–89; imperialism and, 199; liberalism and, 137; limitations to, 210; national interest and, 139; “natural borders” doctrine, 142; populist economics and, 224–25; public opinion and, 278; Spanish constitution (1812) and, 90; trade treaties and, 154; U.S. imperialism and, 149 Soviet Union (USSR), 145, 195, 198, 218; collapse of, 217; containment of, 205, 206, 208; détente with United States, 210; industrialization of, 199–200; military government in Latin America and, 262; United Nations and, 204 Spain, 10; American treasures sent to, 28; colonies’ relationship with, 11; commercial importance of, 147; decline of, 55; desire to reclaim American colonies, 92–93, 97, 141; economic competition and, 154; gold standard and, 160; Indians allied with, 20; Latin American independence refused by, 92–93; liberal revolution (1820), 109; monarchy of colonial age, 2; Napoleonic regime in, 85, 87, 88; New World divided up with Portugal, 28; nobility of, 21, 22–23; Portugal united with, 29–30, 35, 36, 74; as preeminent power, 6; reconquered from Arab rule, 22, 23; reconquest of former colonies, 104, 106, 107; reorganization of empire, 57; vagrancy outlawed in, 48 Spanish America, 45, 50, 60, 76; agriculture and industry, 38; aristocratic titles in, 65; cabildos (municipal councils), 49; commercial routes, 40–41, 44; consti314

index

tutionalism in, 91, 111; educational institutions, 122; English trade with, 58; free trade in, 88; Indian slavery ended, 47; as integral part of monarchy, 89; juntas of legitimacy phase, 102–3, 104; mixed-race population, 62; political class, 133; rebellions suppressed in, 82, 83; republican– royalist debate in, 93, 126; restoration and independence in, 107–10; royal reforms and, 59; slaves imported to, 43 Spanish–American War, 148 Spanish language, 34, 51, 69, 73, 77, 124 Spanish monarchy: autonomist movement and, 107, 110; bureaucratization of, 35; Catholic Church and, 72, 93, 98; colonies’ economic contribution to, 60; as composite monarchy, 26; European rebellions against, 55; imperial designs of, 29, 34; Napoleonic interruption of, 88; reforms of, 57, 58–59, 79, 81; restoration of, 92; rise of, 30; trading licenses granted by, 27. See also Bourbon dynasty; Cádiz constitution (1812); monarchies, Iberian Spanish Succession, War of the, 57 Stalin, Joseph, 199 stock exchanges, 165, 177, 239, 241 structuralism, 4, 6, 273, 274 “subaltern” role, 4 suffrage, 128, 132, 181, 183, 255. See also elections/electoral laws sugar, 28, 38, 42, 116, 117; Dutch control of Brazilian exports, 56; price of, 202; productivity of, 66–67 Taiwan, 5 Talavera, Hernando de, 24 taxes, 228, 237; capital flight and, 236; Cortes and, 35; inflation and, 241; during invasion period, 26, 28, 31; junta reforms and, 103; nobles and conquistadors exempt from, 22, 32; protectionism and, 227; protests against, 79–80, 118; reforms of Spanish monarchy and, 59 technology, 136, 224; communications, 216; economic modernization and, 166; exported goods and, 154; free circulation of, 222, 278; gold standard and, 160;

international communications and, 137; of Mesoamerican and Andean civilizations, 17; mining, 114–15; in oil industry, 229; productivity and, 234 Tenochtitlán, city of, 20, 31, 39. See also Mexico City textile industry, 70, 154, 163; in Brazil, 165; Indian, 42, 44, 66 Third World, 195, 205, 206, 211, 219, 230; aid sent to, 221; nonaligned countries, 212; nuclear powers, 217; “subaltern” role of, 4; Western-type institutions in, 264 Three Guarantees Movement, 110 Tiradentes rebellion, 83 Tlaxcaltecs, 20 tobacco, 56, 66, 70, 81 Tordesillas, Treaty of, 26, 28 total factor productivity (TFP), 232, 233 totalitarianism, 193, 198, 200, 203, 280 Tribunal del Consulado, 44, 63, 64 Tucumán, city and province of, 31, 39, 42 Túpac Amaru rebellion, 81–83, 84, 106, 108 Túpac Katari rebellion, 82, 108 Tupi Indians, 29 Tupinamba Indians, 20 Union of South American Nations, 220 United Nations (U.N.), 193, 217, 258; Economic Commission for Latin America (UNECLA), 207, 211, 235, 241; Educational, Scientific and Cultural Organization (UNESCO), 216; entry of Latin American countries into, 204–5; OAS and, 207 United States, 6, 99, 139, 154; Brazil’s relations with, 94; cold war policies, 205–9; colonialism of, 12; constitutionalism in Latin America and, 91; cultural prejudice against Latin America, 96; détente with Soviet Union, 210; diminished power of, 218; economic modernization of Latin America and, 166; electoral system, 186; expansion and sphere of influence of, 142, 143, 147, 200, 202; gold standard and, 160; Great Britain’s rivalry with, 96–97; great-power status of, 138, 140, 194; G-7 and, 218; inter-American relations and, 200–204; international policy

of, 195; Latin American immigration to, 171, 221, 250; Latin American independence and, 93; Mexican Revolution and, 149; NAFTA and, 220; rail links with Mexico, 163; regional secessionism in, 134; republicanism in, 93, 95; second industrial revolution in, 156; standard of living index, 248; United Nations and, 204; Versailles Treaty (1919) and, 196–97 universities, 78–79 Upper Peru, 39, 81, 82, 102–3. See also Bolivia urbanization, 249–53, 251 urban networks, 172–74 Uruguay, 103, 125, 147; British trade with, 154; Contadora Group and, 220; democratic values in, 254; electoral system, 257; European immigration to, 142, 249, 278; human rights violations in, 213; in Mercosur, 220; political parties, 260, 261; population growth rate, 248; populist economics in, 223; in Second World War, 203; urbanization in, 173, 250, 251 U.S.–Mexican War (1846–48), 96 Utrecht, Treaty of, 8, 54 Valdivia, Pedro de, 20, 21, 32 Valle, marquisate of, 65 Vargas, Getúlio, 259, 268–69 vecinos/vizinhos (household heads), 46, 62, 71, 120; citizenship and, 129–30, 183; electoral systems and, 123; local politics and, 127 Venezuela, 18, 208, 220, 236; border disputes of, 141; cacao production, 66, 70, 75; caudillos in, 128; coffee exports, 115–16; constitution, 90–91; in Contadora Group, 219; democratic values in, 254; depopulation in, 38; economy, 153, 157, 239, 241; education investments in, 233; electoral system, 132, 183, 257; European immigration to, 168; federalist civil war in, 129; as federal nation, 188; free trade in, 88; in Gran Colombia, 109; illiteracy rate, 246; independence of, 105; military forces, 262; naval blockade of, 197; “palm tree republics” in, 75; political parties, 260, 261; population growth rate, 248; populist economics in, 223, 237; privatization in, 237; index

315

Venezuela (continued) rebellions, 80; in Second World War, 203; settlements founded, 71; Spanish reconquest of, 106; standard of living index, 248 Venice, city-state of, 7, 24 Veracruz, port of, 39, 42 Versailles, Treaty of (1783), 58 Versailles, Treaty of (1919), 194–95, 197 Vienna, Congress of (1815), 11, 92, 137–38, 145, 146 Vikings, 7 Villegas, Francisco Javier, 106 Voltaire, 83 voluntary associations, 174–75 Wallerstein, Immanuel, 4 Westernization, 12, 136, 174, 192–93, 244; discovery and, 14; economic modernization and, 166; freedom conceptualized in, 86; inter-American subsystem and, 200–204; literacy and, 77–78; of politics, 253–72; secularization and, 124, 180, 246; as spontaneous, nonlinear process, 282–83; tensions in international relations and, 193–200; urbanization and, 249–50 West Indies. See Caribbean (Antilles, West Indies) islands

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Westphalia, Congress of (1645), 8 Westphalia, peace treaties of (1648), 53, 54, 88, 94 whites (“pure bloods”), 48, 61 Wilson, Woodrow, 147, 161, 166, 196–97 women, 175, 255, 264 working class, 176, 178–79, 186, 244, 261. See also class system World Bank, 9, 206, 211, 225 world system, 4, 9, 274 World Trade Organization (WTO), 9, 126, 218 World War, First, 6, 136, 144, 148, 178; “directoire” by victors, 198; internationalization and, 194; war loans from United States, 160 World War, Second, 150, 196, 280; creation of United Nations and, 204; economic populism and, 222; Lend-Lease Act, 202–3 yerba maté, 47, 70 Yrigoyen, Hipólito, 269 zambos (mixed Indian and black people), 47 Zapatista Liberation Army, 216 Zapotecs, 20 Zea, Francisco A., 95

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