Latin America since Independence

After a gradual transition from the difficult postindependence years, by the 1880s major parts of Latin America had undergone remarkable political change. In contrast to the instability of the early years, several Latin American countries were characterized by stable and effective governments. These governments were not democracies; they were run by and for the elites, not the masses. These stable governments came in two basic forms: long-term dictatorships and elected oligarchic regimes that had the form but not the substance of democracy. In the countries with elected governments, voting was limited to those few men who could meet property and literacy requirements, which prevented the great majority of the population from participating in political life. Most of the dictatorships of the period also held elections, but they were rigged so that the incumbent dictator was assured of continuing in office.

Regardless of their form, many of the new regimes were influenced in varying degrees by the European doctrine of positivism—a philosophy developed in France by Auguste Comte, a founder of the modern discipline of sociology, who published his six-volume Cours de philosophie positive between 1830 and 1842. According to Comte, humans had evolved through three stages: the theological, the metaphysical, and the positive. While the earliest stage revolved around religious dogmas and the second involved the political and philosophical abstractions characteristic of the Enlightenment, the culminating stage was grounded in empiricism and science. The task of individuals and governments during the positive stage was to promote political order and material progress and leave aside ideas and debates that distracted them from that goal.

Latin America provided the most fertile ground for positivism to blossom. Educated Latin Americans could equate Comte’s concept of human evolution with their own history. The theological stage was the colonial period when the powerful and monopolistic Catholic Church held sway and, to liberals, kept people in a state of ignorance and passivity. The metaphysical stage in Latin America coincided with the postindependence period of ideological conflict between conservatives and liberals that led to instability, caudillo rule, and brutal civil wars such as Mexico’s War of the Reform that cost dearly in lives and inflicted heavy material damage. By the last quarter of the nineteenth century, when political order and material progress were beginning to take hold in several countries, the idea of putting ideological conflict aside and concentrating on the business of the “positive” period had wide appeal.

Positivists were found throughout Latin America, but they held greatest sway in Mexico and Brazil. The apostle of positivism in Mexico was Gabino Barreda, an early convert and director of the National Preparatory School in the 1860s and 1870s under President Benito Juárez. Positivist doctrine spread outward from the school, strongly influencing the men who would set the direction of the Porfirio Díaz dictatorship, chief among them Diaz’s Secretary of the Treasury José Ives Li-mantour. The leader of the Brazilian positivists was Benjamin Constant Botelho de Magalhães, who wrote about the doctrine and, along with his disciples, taught it in military schools and universities. Embracing modernity, positivists viewed the Brazilian monarchy as outdated and advocated replacing it with a republic. When the republic was established in 1889, ending the long-lived empire, it adopted a new flag with the positivist slogan “order and progress” emblazoned on it; this slogan remains on Brazil’s flag today.

After experiencing its rocky start as an independent country, Mexico well illustrates the transition to stable and effective government. Following the defeat of the French-imposed Emperor Maximilian in 1867, Juárez resumed his interrupted presidency. In 1872, he was succeeded by Sebastián Lerdo de Tejada. Both liberal presidents pursued modernizing policies: public education, railroad construction, tax reform, and internal security, and the instability of previous years began to fade. Yet despite their efforts, Mexico in 1876 still more closely resembled the Spanish colony it had been than the dynamic, modernizing country it would soon become. No more than 5 percent of children attended school; bandits infested roads throughout the country, and those roads were hardly worthy of the name. Vagrants multiplied in the cities and towns. There was no true national economy; the sharp geographic divisions instead had created a series of self-s ufficient regional economies. However, there were signs of change: defeat of the French kindled a sense of nationalism that had been absent before, and the opening of the Veracruz–Mexico City railroad in 1873 promised a connection to the emerging world market.

Mexico’s transition to stability and development was synonymous with one man: Porfirio Díaz, a mestizo born in the southern city of Oaxaca in 1830. He studied first for the priesthood, then law, but made his mark in the military. His star rose after he played a critical role in the defeat of the French army at Puebla on May 5, 1862, temporarily halting its advance on Mexico City. This was a rare victory of Mexican arms over a foreign adversary, celebrated more in the United States than in Mexico as the cinco de mayo. A liberal, Díaz ran an unsuccessful campaign for president against Juárez in 1871. Following his loss, he launched a weak rebellion, castigating Juárez for his longevity in office. Following Juárez’s death in 1872, he ran again and lost. When Juárez’s successor, Lerdo de Tejada, announced for reelection in 1876, Díaz launched his Plan de Tuxtepec, an indictment of Lerdo de Tejada’s presidency and an announcement of the principle he proposed to instill in Mexican politics: “effective suffrage and no re-election.” Successful in his rebellion, Díaz forgot about his slogan and stayed in power through multiple reelections, lending his name to his thirty-four-year reign: the Porfiriato.

Recognizing Mexico’s potential in the global economy, Díaz and his advisors focused on establishing the political stability that would give foreigners the confidence to bring their capital and technology to develop Mexico’s exportable resources. Thus, they set out to eliminate the sources of instability that had plagued the republic, some of them since its inception. Díaz beefed up the rural constabulary, the rurales that Juárez had established, and charged it with eliminating the banditry that disturbed order and impeded commerce. The army, a constant threat of rebellion and destabilization, had been reduced in size by Juárez; Díaz provided it a budget adequate for payroll and equipment with enough left over for graft among the officer corps. He also rotated his generals so that none developed deep ties to a region and its troops, and with growing railroad and telegraph networks, he could anticipate and defeat any rebellions that might occur.

Knowing from Mexico’s history that unpaid foreign debt offered an excuse for foreign military intervention, as in the Pastry War and the French occupation, Díaz paid as much and as fast as possible to foreign creditors. The church question had been the core issue that embroiled Mexico in civil war and foreign conquest following enactment of the 1857 constitution. Díaz kept the anticlerical laws on the books but did not enforce them rigorously, thus striking a compromise between liberals and conservatives on that issue. Finally, Díaz co-opted the regional caudillos and powerful families by inviting them into the political machine he was creating. If they cooperated by delivering their states’ votes to his reelections, they earned governorships and lucrative business contracts. If they refused to cooperate or challenged him, he responded with force. Díaz called this approach to politics his “patriarchical policy,” while others called it “pan o palo” (bread or the club). By attacking the traditional sources of instability, he created the first effective central government since independence.

In Mexico, the establishment of stable and effective governance was achieved through dictatorship that preserved the trappings but not the substance of the liberal state developed after the age of Santa Anna. Díaz stepped aside after his first term in favor of a placeholder, true to his promise of “effective suffrage and no re-election.” But from 1884 on, he was regularly reelected along with a national Congress, state governors and legislatures, and municipal officers—all decided in advance by Díaz and his collaborators.

Political stability and development of the export economy went hand in hand. As signs of stability emerged, foreign capital flowed into Mexico, enhancing government revenues and ensuring adequate military budgets. Foreigners invested in railroads, mining, petroleum, banking, and utilities, while primarily domestic capital developed cattle, cotton, sugar, henequen, and manufacturing, including a steel mill that opened at Monterrey in 1900. By 1908, Mexico had fifteen thousand miles of railroad track and the telegraph reached into remote areas, reinforcing Díaz’s ability to maintain political control.

Mexico’s foreign trade grew by nearly ten times during Diaz’s dictatorship, each increase bringing more tariff revenue. In 1894, Mexico achieved a balanced budget for the first time in its independent history; Mexican bonds were selling above par by 1900. In September 1910, when Porfirio Díaz presided over the glittering centennial of Father Miguel Hidalgo’s Grito de Dolores, he was justifiably proud of his achievements. But while most of the foreign dignitaries attending the centennial were unaware of the other side of the Porfiriato—the human cost of the glowing statistics and the political calm—Mexicans were not.

Venezuela offers another example of government stability and economic development through dictatorship—in this case, multiple dictatorships. Initially included in the independent country of Gran Colombia, Venezuela along with Ecuador seceded in 1830. Venezuela’s next two decades were dominated by the independence war hero General José Antonio Páez, who served two presidential terms and made and unmade other rulers.

The 1850s and 1860s were a period of frequent turnover in government. Regional caudillos were a continuous source of political instability, rebelling frequently and sometimes successfully against central authority. The turmoil was the result of not only personal ambition for power, but also of a struggle between liberals and conservatives over federalism versus centralism and over the church issue, culminating in the “federal wars” of 1859–1863. Federalism triumphed, but political instability did not recede until the advent of the first of four long-term dictators, General Antonio Guzmán Blanco. Guzmán Blanco served as president from 1870 to 1887, with two brief interludes, and presided over a regime clothed in the trappings but lacking the substance of an elected government. Guzmán Blanco cemented military dominance over politics, a tradition that lasted well into the twentieth century.

Guzmán Blanco, the self-proclaimed “Illustrious American,” came to power as the world market was taking shape. Along with Central America, Colombia, and Brazil, Venezuela expanded coffee production to meet the rising demand, while maintaining its significant export of cacao and hides. Like Porfirio Díaz, Guzmán Blanco governed by co-opting or suppressing the regional caudillos, leading to the country’s first prolonged period of stability. This stability, along with enhanced income from the growing export economy, allowed Venezuela to access foreign credit and Guzmán Blanco to improve the efficiency of the national army, introduce railroads and the telegraph, and modernize Caracas, bringing contemporary European style to the former colonial regional capital. By 1887, the Illustrious American had lost his ability to balance Venezuela’s political forces and left for exile in Europe.

Following a period of instability, two more generals took power and restored order: Joaquín Crespo (president 1892–1898) and Cipriano Castro (president 1899–1908). This period featured further integration into the world economy and growth of modern infrastructure in both cities and countryside. By the 1890s, all major cities were connected by a French-operated telegraph system and by either railroads or improved cartage roads. Castro’s failure to pay foreign debts led to an embarrassing international incident in 1902–1903, when British, German, and Italian warships blockaded Venezuela’s coast and shelled ports until, under pressure from the United States, Castro agreed to arbitration that resolved the crisis.

The last of Venezuela’s long-term dictators, General Juan Vicente Gómez, overthrew Castro in 1908 to launch twenty-seven years of personal governance. Gómez ruled as head of the army and through a secret police force that he developed. He squelched normal political life: While retaining an elected but pliant Congress, he dissolved parties and silenced, jailed, tortured, exiled, or killed both real and imagined opponents.

It was during Gómez’s dictatorship that oil became Venezuela’s primary export, and it has remained so to the present. The Caribbean Petroleum Company, a subsidiary of Royal Dutch Shell, began production in 1914. Three years later, the country’s first oil refinery opened and exports of refined petroleum began. Venezuela enacted its first hydrocarbons law in 1920; in 1926, the value of oil exports surpassed that of coffee, and in 1929 Venezuela became the world’s leading exporter of oil. Oil produced a bonanza for Gómez personally, for the government, and for a cadre of entrepreneurs and professionals who supplied goods and services to the foreign-owned petroleum companies. However, with the rise of petroleum, the country’s primary export sector passed into foreign hands, enmeshing Venezuela’s economy further in dependency.

Ethnic composition: Spanish, Italian, Portuguese, Arab, German, African, and indigenous people (no figures provided)

Household income (proportion in the highest and lowest 10%): highest 32.7% and lowest 1.7%

Source: The World Factbook (Central Intelligence Agency, Office of Public Affairs).

The Díaz regime in Mexico and Gómez’s dictatorship in Venezuela perfectly illustrate the relationship between economic development and political stability that characterized much of Latin America during the era of the export economies. Essential to stability was the development of national armies capable of repelling uprisings by dissident caudillos seeking to overthrow governments—a frequent occurrence in most countries during the half-century following independence. As revenue flowed into the national treasuries, governments were able to purchase materiel for their armies—such as repeating rifles, Gatling guns, and artillery—that the opposition could not afford. Superiority in arms was supplemented by enhanced training. Latin American governments brought training missions from Britain, Germany, and France and sent top officers to European military academies for advanced study. By the early twentieth century, most countries had established military academies, based on European models, that educated and trained selected young men for membership in professional armies and navies. Coupled with the telegraph, which instantly sent news of actual or suspected rebellions to the government, and railroads and improved roads that expedited the dispatch of troops to areas of concern, the professional armies discouraged uprisings or crushed them before they could spread and threaten the government.

After the professionalization of Latin America’s armed forces, old-style, caudillo-led rebellions rarely succeeded. Henceforth, most successful rebellions originated within the armed forces themselves. Thus military coups, rather than caudillo-led uprisings, became the standard non-electoral method of changing governments in the twentieth century.

The small Central American country of Costa Rica offers an example of a different type of stable and effective government that emerged during the era of the export economies: the elected oligarchic regime. Colonial Costa Rica was the southernmost administrative subdivision of the captaincy general of Guatemala, which in turn was subordinate to the viceroyalty of New Spain in Mexico City. Its small population of creoles and mestizos was concentrated in the compact Central Valley, with unassimilated natives living beyond. Apart from a small production of cacao for export, the cattle-raising and agricultural economy was self-sufficient. As a result of Costa Rica’s remoteness and lack of economic importance, the royal bureaucracy and Catholic Church were less powerful than in more developed areas of the Spanish Empire. The breakup of the United Provinces of Central America in 1838 gave birth to the republic of Costa Rica, without the independence wars that ravished major parts of Mexico and Spanish South America.

Costa Rica was exporting small amounts of coffee by the 1830s. Early postindependence governments encouraged coffee cultivation with subsidies and free seedlings. In contrast to Argentina, Mexico, and other countries, Costa Rican governments distributed baldíos, or public lands, at modest prices in small holdings rather than in latifundia; as a result, in some new coffee-growing areas, up to 90 percent of the holdings were one hundred acres or less. These small holdings coexisted with the previously developed large landed estates dating from the colonial period.

Following the breakup of Central America, Costa Rica developed a pattern of governance that lasted to the 1870s. The large coffee planters of the Central Valley, the cafetaleros—who also tended to control the financing, processing, and marketing of the crop—dominated electoral politics by restricting the all-male vote through property and literacy requirements. Elections were controlled by presidents and fraud was commonly used to determine outcomes. The military, descended from the colonial militia, was the other political actor; shifting cafetalero–military alliances led to frequent uprisings and the overthrow of governments: In Costa Rica’s first thirtytwo years of independence, only four of fourteen presidents finished their terms.

The year 1870 was a turning point in Costa Rica’s political development. Liberal Tomás Guardia Gutiérrez seized power in a coup, ruled as a strongman until 1882, and instituted important changes. Although a military man, Guardia set out to reform the military in order to establish civilian control in politics. He brought in European officers to improve training, raised salaries, and wrote a new military code. Given friction with neighboring Nicaragua over a potential canal through territory claimed by Costa Rica (Chapter 6), Guardia was able to focus the army on external defense rather than internal politics. This early case of professionalization of the armed forces brought stability to the political process: between 1870 and 1917, seven of nine presidents finished their terms or died in office of natural causes.

Ethnic composition: white or mestizo 83.6%, mulatto 6.7%, indigenous 12.4%, and black 1.1%

Household income (proportion in the highest and lowest 10%): highest 39.5% and lowest 1.2%

Source: The World Factbook (Central Intelligence Agency, Office of Public Affairs).

Guardia did more than depoliticize the army. He dictated a new constitution in 1871 that strengthened executive power over Congress and over elections. He invested income from growing coffee exports in education, public health, transportation, ports, public buildings, and the bureaucracy. Guardia also included girls in the mandate for universal primary education and established the Colegio Superior de Señoritas to develop women teachers.

While coffee production grew more rapidly from the 1850s on, the export potential was limited by challenging terrain and inadequate transportation. Thus in 1871, Guardia contracted with U.S. citizen Henry Meiggs to build a railroad from Alajuela, in the Central Valley, to Puerto Limón, on the Caribbean—a distance of 117 miles. The financial terms proved difficult for the government and a bonanza for Meiggs and his nephew, Henry Meiggs Keith, who oversaw the project. In addition to financial incentives, Keith received control of the railroad and a ninety-nine-year lease on some eight hundred thousand acres of Caribbean lowlands, about 7 percent of the national territory. As in Honduras, sufficient labor could not be lured from the temperate highlands to the pestilential lowlands, leading Keith to import West Indian labor to build the railroad, modernize the port, and work the plantations he established in the region. Keith formed the Tropical Trading and Transport Company, which merged in 1899 with the Boston Fruit Company to form the United Fruit Company (UFCO). The Alajuela–Puerto Limón railroad not only created a banana economy in Costa Rica, but upon its completion in 1890 also greatly stimulated coffee exports to Europe and the United States.

The 1889 presidential election was another turning point in Costa Rica’s political development. With a liberal incumbent president, conservative candidate José Joaquín Rodríguez Zeledón won the vote count, but his liberal opponent initially refused to concede defeat. After drawn-out negotiations, Rodríguez was allowed to take office six months after the election. This tense but peaceful surrender of power to the opposition party marked an advanced degree of maturity for Costa Rica’s political system—a stage not reached in most Latin American countries until much later.

By 1930, Costa Rica had not only achieved stable and effective governance, but had also laid the groundwork for becoming one of Latin America’s most enduring and stable democracies. The last successful military coup in Costa Rican history, led by Colonel Federico Tinoco and his brother José Joaquín Tinoco, occurred in 1917; the regime they established lasted less than two years. Workers and middle-class people began to organize politically in the 1920s, founding reformist parties and several unions, and the Liga Feminista (Feminist League) promoted women’s suffrage. By 1930, Costa Rica had established ministries of labor and public health. And, reflecting judicious investment in public education from the mid-nineteenth century on, the country’s literacy rate had risen from 11 percent in 1864, to 31 percent in 1892, to 76 percent in 1927. This educated population was important to the country’s further evolution toward democracy.

Brazil offers another example of a country governed by an elected oligarchy during the era of the export economies. Unlike most of Spanish America, Brazil had made a relatively smooth transition from colony to independent country, mostly by virtue of continuity of rule by the Portuguese–Brazilian Braganza dynasty. The constitutional monarchy, with its constraints on royal power and an extremely limited franchise, functioned relatively smoothly under Emperor Dom Pedro II. But by the early 1870s, challenges to the status quo had arisen.

The 1864–1870 Paraguayan War (Chapter 3) expanded Brazil’s military and heightened the officer corps’s awareness of its interests. Officers joined with civilians to form the antimonarchy Republican Party in 1870. The rise of positivism in Brazil also weakened the monarchy, as the newly popular doctrine held that modernity must be embraced—and monarchy was an ancient, old-world institution. Following the 1888 Golden Law that abolished slavery, the momentum for political change peaked and the military, led by Marshal Deodoro da Fonseca, carried out a peaceful coup in 1889 that sent Emperor Pedro II and the royal family into exile in Portugal. A new constitution, adopted in 1891 and closely modeled on the U.S. document, created a federal republic of twenty states and a federal district in Rio de Janeiro, the capital. The president was to be elected directly, but elite political control was assured by the restriction of voting rights to literate males; fewer than 3.5 percent of Brazilians voted in presidential elections before 1930. Thus, the transition from empire to republic brought relatively little real change to Brazil.

The abolition of slavery and the continued ascendancy of coffee in the economy increased opportunities for Brazil to attract European immigration. Coffee production was labor intensive, and immigrants were able to earn a decent living by contracting with landowners to tend a certain number of trees. As in the other larger Latin American countries, the export economy created industry that supplied the country with light consumer goods: The thirteen thousand factories that existed in the state of São Paulo alone by 1920 provided additional employment for European immigrants, some four million of whom arrived in Brazil between 1877 and 1930, primarily from Italy and Portugal with smaller numbers from throughout Europe. Beginning in 1908, Brazil attracted substantial Japanese immigration, giving the country Latin America’s largest Asian population. Most immigrants went to São Paulo and other coffee and industrial states of the center and south. While the total number of immigrants rivaled that of Argentina, Brazil’s pre-immigration population base was much larger than Argentina’s, and thus the foreign-born percentage of Brazil’s population fell far short of Argentina’s and, for that matter, that of the United States.

The rise of coffee and manufacturing accelerated the shift of wealth and power from the traditional northeast to the dynamic central and southern states. In the strongly federal system, state governors wielded great power; those of São Paulo and Minas Gerais wielded the most, and they often determined the outcome of presidential elections. Potent political machines developed in the states, particularly the poorer rural ones. In a system known as coronelismo, the bosses—called coroneis (colonels) because of a vague connection to colonial militias—delivered votes in exchange for financial and political benefits.

By the 1920s, the republic came under attack from both civilian dissidents and junior military officers. The dynamic coffee and industrial economy had created both a middle and a new working class whose growing demands for political representation and favorable policies were thwarted. The main complaint driving both civilian and military groups was that the republic was an empty shell in which voting restrictions, fraud, and the federal structure gave the backward rural states the ability to check progressive policies advocated by the wealthier developing regions. Paulistas, or residents of São Paulo state, began thinking of Brazil in railroad terms, as a locomotive (São Paulo) pulling twenty empty boxcars (the other nineteen states and the federal district), and they saw no remedy for that within the republic’s institutional structure. In addition to these grievances, military officers had professional reasons for discontent within an institution they considered backward and elitist. These concerns spawned revolts in 1922 and in 1924, the beginning of the bizarre phenomenon of the “Prestes Column.” Army Captain Luís Carlos Prestes, who would become a leader of Brazil’s Communist Party, sought unsuccessfully to provoke a broad-based uprising against the regime by leading a three-year, one-thousand-man, fifteen-thousand-mile protest march through the Brazilian interior and into Paraguay and Bolivia.

Ethnic composition: white 47.7%, mulatto 43.1%, black 7.6%, Asian 1.1%, and indigenous 0.4%

Religious affiliations (nominal): Catholic 65%, Protestant 22%, other Christian 0.7%, and spiritist 2.2%

Household income (proportion in the highest and lowest 10%): highest 42.9% and lowest 0.8%

Source: The World Factbook (Central Intelligence Agency, Office of Public Affairs).

The Great Depression finished off the “first republic,” as the regime founded in 1889 came to be known. Extreme dependence on coffee exports, the engine of Brazil’s development during the previous sixty years, became a disaster overnight as world market prices fell by two-thirds. The president, Washington Luís, refused to take financial steps that might have cushioned the blow and made an unpopular endorsement for his successor. Getúlio Vargas, the opponent of Luis’s candidate, lost the election but took power by military coup. The first republic was dead.

Mexico, Venezuela, Costa Rica, and Brazil illustrate two basic patterns of achieving stable and effective, but not democratic, political institutions during the period of economic development brought on by integration into the world market. Most other countries emerged from their chronic postindependence instability and developed reasonably effective governments without following either the long-term dictatorship or the elected oligarchy pattern. Nor did they completely overcome the factors that interrupted or overthrew governments from time to time. Colombia and Peru provide examples of these incomplete transitions to stable and effective governance.

Colombia experienced the standard challenges facing the newly independent countries. Simón Bolívar established Gran Colombia, which encompassed the whole of the former viceroyalty of New Granada, at the Congress of Angostura in 1819. The subsequent decade brought instability, violence, and personal contests between the centralist President Bolívar and his rival, federalist Vice President Francisco de Paula Santander. In 1830, Gran Colombia succumbed to the centrifugal pull of regional identities established over the three colonial centuries and broke into Venezuela, Ecuador, and the Republic of New Granada, which changed its name to Colombia in 1863. Independent New Granada continued the earlier pattern of frequent constitutional change, military uprisings, violence, and civil wars between liberals and conservatives.

By the late nineteenth century, coffee and bananas had superseded the traditional exports of gold, tobacco, and chinchona bark (used to make quinine), and increased government revenue enhanced political stability and underpinned the long dominance of conservative Rafael Núñez (president 1880–1882 and 1884–1894). Núñez took and retained power through elections but ruled as a virtual dictator. His 1886 constitution strengthened presidential powers, centralized control in Bogotá, and—without going quite to the extreme of his contemporary and neighbor Gabriel García Moreno of Ecuador (Chapter 3)—returned to the Catholic Church much power that earlier liberals had stripped from it. The Catholic restoration was formalized in an 1887 concordat.

The period of conservative rule that continued after Núñez led to a liberal rebellion known as the War of the Thousand Days (1899–1902). The conservative government sent its army and guerrilla supporters against liberal irregulars in a bloody conflict that would eventually cost one hundred thousand lives due to combat and disease; this conflict set precedents for further institutionalized liberal–conservative war that peaked between the 1940s and 1960s in a conflict known simply as “La Violencia.” The conservatives’ victory in the War of the Thousand Days contributed to the independence of Panama, which harbored strong liberal sympathies and proved receptive to U.S. overtures to support its break with Colombia and host a transoceanic canal (Chapter 6).

Conservative political dominance continued to 1930, but not without outbursts of instability and violence and periods of authoritarian rule. General Rafael Reyes came to power in 1904, disbanded Congress the following year, and ruled as a virtual dictator until he resigned and left for Europe in 1909. As the fledgling working and middle classes began to organize, they were normally met with repression as in the notorious “banana massacre” of 1928. Led by the Revolutionary Socialist Party (the forerunner of the Colombian Communist Party), twenty-five thousand workers on UFCO’s Caribbean coast plantations went on strike for better wages and working conditions. The U.S. manager appealed to Colombian president Miguel Abadía Méndez to intervene, and the president sent troops who killed or wounded hundreds of strikers. The event became another black mark on the reputation of UFCO. But despite these and other incidents showing that Colombia had not completely overcome its early political history, the country moved gradually away from instability and authoritarianism and toward stable and effective governance in the early twentieth century.

Ethnic composition: mestizo and white 84.2%, Afro-Colombian 10.4%, and Amerindian 3.4%

Household income (proportion in the highest and lowest 10%): highest 42% and lowest 1.1%

Source: The World Factbook (Central Intelligence Agency, Office of Public Affairs).

Peru also experienced mixed results in its evolution toward political maturity. Like Colombia, it underwent periods of anarchy, dictatorship, and caudillo rule, starting with an average of one regime change per year between 1821 and 1845. In contrast to most other countries, Peru did not develop the standard liberal–conservative party division; rather, parties tended to be personalistic and unstable. Even the relatively long-lasting Civilista Party, founded in 1872 as the vehicle to serve elite interests, had little ideological underpinning.

From 1840 to 1870, Peru was the richest Latin American country in terms of governmental income by virtue of the exploitation of guano—nitrate-rich bird droppings found on the offshore Chincha islands that were prized in Europe as fertilizer. To dig and load the valuable substance, contractors imported over thirty thousand Chinese indentured workers who labored under slavery-like conditions. Despite the guano bounty, profligate government spending, corruption in the administration of guano contracts, and indiscriminate borrowing from European banks left the country financially vulnerable. In 1869, its government turned the debt over to the French banking house of Dreyfus in exchange for Dreyfus’s monopoly of guano mining and exportation.

In addition to guano and the metals that awaited foreign investment to be extracted, Peru had valuable nitrate deposits in its southernmost province of Tarapacá, located in the extremely dry Atacama Desert adjacent to the nitrate-rich Bolivian province of Antofagasta. British and Chilean investors had begun to exploit nitrates for export in the 1870s, but when Bolivia raised taxes on Chilean operators in 1879, they refused to pay and Bolivian president Hilarión Daza attempted to seize Chilean assets. Chile deployed troops to the region and the Peruvian government, bound by a secret alliance with Bolivia, joined the fray that quickly became the War of the Pacific—only the second full-scale intra–Latin American war of the nineteenth century. The conflict was a disaster for Peru: After winning a series of naval battles, Chilean troops occupied Lima, forcing Peru to sign the 1883 Treaty of Ancón which surrendered Tarapacá to Chile. Bolivia lost Antofagasta province and its outlet to the Pacific, and both countries lost the resource that would enrich victorious Chile for the next half-century.

The loss in the War of the Pacific was a deep wound to the country that had been the capital of all of Spanish South America, that had a much larger population than Chile, and that expected victory over the upstart republic to its south. From the 1880s on, the dominant public discourse was, “What’s wrong with Peru?” Manuel González Prada, the first prominent intellectual to address the question, responded that Peru was not a nation but a country divided by difficult geography and especially by racial barriers between the dominant elites and the Indian majority in the Andes. The system of governance in the Andes, known as gamonalismo, involved total dominance by large estate owners (the gamonales) who used and abused the mostly Quechua Indians for their own profit and power. Because they were exploited, illiterate, ignorant, non-Spanish speaking, and isolated in their own enclaves, Indians marshaled for military duty against the Chileans did not even know that “Peru” existed. For González Prada, the Indian had to be redeemed before Peru could progress.

“We keep [the Indian] in ignorance and servitude, we debase him in the barracks, we brutalize him with alcohol, we send him to be destroyed in civil wars and from time to time we carry out massacres…. In the interior [the Andes] one sees the violation of all laws under a true feudal regime. There are found neither laws nor courts of justice, because the hacendados and gamonales … assume the roles of judges and enforcers of sentences.” (207) “Haciendas constitute kingdoms in the heart of the Republic, hacendados exercise the role of autocrats…. In many towns of the interior there is not a single man capable of reading or writing. During the War of the Pacific, the Indians viewed the struggle between the two nations as a civil war between General Chile and General Peru.” (211)

Source: Manuel González Prada, Horas de lucha (Lima, Peru: Fondo de Cultura Popular, 1904), from the section titled “Our Indians,” 199–213 (author’s translation).

Adding to Peru’s pain and humiliation was the 1889 Grace Contract. After guano reserves had been exhausted and the nitrates of Tarapacá lost, Peru had no way to service its debt. The solution was the Grace Contract, which delivered the country’s existing and future railroads to a British consortium (the Peruvian Corporation) for sixty-six years in exchange for assuming the huge debt. Giving away the railroads, a symbol of modernity just beginning to penetrate the Andes, was viewed by many Peruvians as an unscrupulous, antipatriotic bargain. Although the contract may have given Peru the best terms available, that was not the popular perception: The elite-dominated governments began to be seen as vendepatria (sellers-out of the fatherland), a view that would harden in coming decades and fuel strong nationalist sentiments well into the twentieth century.

Military coups and instability returned after the War of the Pacific. Military men dominated between 1885 and 1895, when Nicolás de Piérola, who had been de facto president during part of the war, returned to power via a popular uprising. The Civilista Party gained power at the turn of the century, but it developed a reformist wing that contributed to instability, then to authoritarianism. Guillermo Billinghurst was elected president in 1912 and overthrown by the military in 1914. Augusto B. Leguía was elected in 1919 and retained power for eleven years. He heavy-handedly subdued opponents in Congress, ruled as a virtual dictator, and was reelected twice through rigged ballots before being removed by the military when the Great Depression struck in 1930. Peru, then, had come a long way from the annual turnovers in government during its first twenty-four years, but instability and authoritarianism survived into the early twentieth century.

The Latin American elites’ status and power reached their pinnacle during the era of the export economies. The very wealthy lived in luxury, ran their countries either directly or through friendly dictators, and exuded an air of assurance that their European counterparts could only envy. The ranks of the creole and mazombo elites had been expanded and strengthened by financially successful immigrants from around Europe whose non-Hispanic surnames added variety to the newspapers’ society pages. Following a visit to Chile in 1909, a U.S. political scientist, Paul Reinsch, published an article in the American Political Science Review describing the country’s elites as “an aristocracy of birth and wealth [that] … still has full and acknowledged control of the economic, political and social forces of the state in which they live.”¹ He could have described many other Latin American countries in similar terms.

Professor Reinsch’s visit was evidently orchestrated by some of the country’s most wealthy and powerful, for had he strayed beyond the Club de la Unión, the ornate halls of Congress, and the sumptuous parlors and country estates of the oligarchy, he would have seen a country undergoing rapid change. As late as the 1860s, Chile and the rest of Latin America still preserved the social structure inherited from the colonial period. This consisted of a tiny, mostly white minority of elites, a poor mass of people of mixed race, and in some countries sizeable Indian populations that in Guatemala and the Andean region constituted a majority. Brazil, the Caribbean islands, and parts of the mainland republics were home to large numbers of African-descended people, either slave or free. There was almost no middle class below the elites, and no modern working class, or proletariat, of the type found in industrial societies.

By the turn of the twentieth century, the colonial social order had changed, particularly in the larger and more developed countries. The economic expansion and modernization generated by the export economies brought about the development of more articulated class distinctions. Heightened and diversified economic activity stimulated import/export, wholesale, and retail commerce and financed the growth of public education and government bureaucracies. Employment in these sectors required some education and was considered white collar rather than manual labor—in other words, middle-class jobs. As economic expansion continued, clerks in commercial establishments and banks, accountants, bureaucrats, teachers, foremen, military officers, and small-business owners came to constitute a fledgling middle class that developed a consciousness of its distinction from both the elites above and the masses beneath their status.

Meanwhile, the building and operating of railroads and work in mines, in processing plants, on the docks, in construction, on banana and sugar plantations, and in a variety of new urban occupations produced another new social class: the proletariat. In addition, the factories that grew up in the larger South American countries and Mexico to provide for local needs—processed foods, tobacco products, textiles, beer, furniture, glass, iron, cement, and other goods—augmented the new working class.

Women were important actors in the emerging social groups. As the export economies drove the growth of urban occupations, women became wage laborers in both the white- and blue-collar sectors. Lower class women had worked outside the home since colonial days as domestic servants, laundresses, market vendors, and in other varied activities. By the turn of the century, women had become important components of the factory labor force, particularly in the manufacture of textiles, garments, and tobacco products. In 1912, over 70 percent of workers in São Paulo’s booming textile factories were women, and still more wove and sewed at home. In the 1910s, women constituted 26 percent of all factory workers in Chile and 18 percent of those in Buenos Aires. Women’s integration into the blue-collar labor force was not always smooth. For males in general, factory labor and the independence it entailed clashed with the ideal of protected womanhood and the male role as provider; and their male fellow workers feared that the lower wages that women earned might bring down their own pay.

The advance of public education offered opportunities for women to enter the middle class through white-collar employment. By the 1870s, public education through high school, while reaching only a fraction of the Latin American population, had been established in national and many state or provincial capitals. In 1873, nearly a third of Brazil’s enrolled students were female. In Argentina, President Domingo F. Sarmiento (1868–1874) (the gaucho-hater of Chapter 3), a friend of U.S. public education pioneers Horace and Mary Mann, established normal schools for women as well as men; by the 1890s, technical schools for both sexes had appeared. Women, thus, were prepared to fill white-collar jobs as teachers, nurses, clerks in government and private sector offices, and salespersons in shops and the new department stores. They constituted a majority of teachers in Argentina and Chile in the 1910s, and women had begun to break into the medical and legal professions in miniscule numbers. But they were still disenfranchised and denied full citizenship.

By the time of Professor Reinsch’s visit, in Chile, Brazil, Argentina, Uruguay, Mexico, and a few other countries, the middle and working classes created by the export economies had begun to make their voices heard. Workers had begun to organize unions, which in their early days were usually illegal, and used the strike, always at great peril, to defend their interests and try to improve pay and working conditions. Strikes were normally put down by force, often leading to massacres of great proportions. Males of both the working and middle classes in some countries formed political parties to represent their interests; after the 1917 Bolshevik Revolution brought the Communist Party to power in Russia, some Latin American workers’ parties transformed themselves into domestic Communist or Socialist parties. And despite Reinsch’s observations to the contrary, by the turn of the twentieth century, these new organizations—labor unions and middle-class and workers’ parties—had actually begun to contest the elites’ monopoly of political power.

Chile provides an excellent example of the development of the new social classes, their challenge to the elites, and the elites’ response. We focus on the proletariat, as the Chilean working class became one of the largest (as a share of total population) and most combative in Latin America. Without the militance and persistence of this working class, Chile would not have been the only country, not only in Latin America but also in the world, to select an orthodox Marxist president through a free and fair election: Salvador Allende, president 1970–1973 (Chapter 10).

While the bulk of Chile’s working class grew out of the manual labor occupations described above, the most radical part of it developed in the heart of the export economy: the nitrate mines of the northern desert that Chile wrested from Peru and Bolivia in the War of the Pacific. Chilean control of the nitrate zone brought increased investment, primarily British and Chilean, and a need for labor in the almost unpopulated area. Nitrate workers were recruited by the thousands, largely from among laborers on the large landed estates of Chile’s Central Valley, and lured to the arid north by promises of fantastically high wages. From fewer than three thousand nitrate workers in 1880, the ranks swelled to fifty-three thousand in 1913 and peaked at sixty-one thousand in 1925.

Conditions in the nitrate zone proved ideal for creating a militant proletariat. The promised wages were eaten up by the high cost of living, as everything had to be shipped from great distances and the mining companies’ stores monopolized sales. Working conditions were hard and dangerous, and the transition from agricultural to regimented industrial-style labor was jarring. Workers lived together in barracks, without their families who remained behind, and were isolated from outside contact in the sprawling desert. For those working in British-owned mining operations, where the best positions, quarters, and supplies were reserved for the foreigners, being supervised by British managers gave workers a taste of “eyeball-to-eyeball” imperialism—the humiliation of being considered and treated as an inferior by foreigners in one’s own country. The arrival in the nitrate zone of labor organizers, including socialists and anarchists, completed the recipe for radicalization.

Unions began to appear in the 1880s. Most of the original ones were simple mutual aid societies, but in the coming decades more of them were Marxist or anarcho-syndicalist. They began to strike against their working conditions and, in the cases of the more radical unions, against capitalism itself. After the first recorded strike in 1887, by the early 1900s, workers were carrying out major strikes, and the companies and the Chilean government were responding vigorously. Among the larger nitrate strikes were one in the port city of Antofagasta in 1906, in which over one hundred strikers were killed or injured, and another the following year in Iquique, where soldiers killed or wounded up to two thousand workers. Beyond the nitrate zone, the cities of Valparaíso and Santiago witnessed numerous strikes. In 1905, crowds protesting the high price of meat, caused in their view by a tariff on Argentine cattle, took over Santiago for a couple of days before troops arrived to restore order. The first national labor organization, the Chilean Workers’ Federation, was founded in 1909.

The Radical Party, established in 1863 to oppose the dominant conservatives, had become a vehicle of the middle classes and was well represented in Congress by 1900. The Democratic Party, dating from 1887, was the electoral voice of the working class. It stood for the “political, economic, and social liberation of the people” and elected its first representative to Congress in 1894.² Its left wing split off in 1912 as the Socialist Workers’ Party, which subsequently became the Communist Party in 1922. Thus by the early 1920s, both middle- and working-class interests, while remaining a distinct minority in Congress, had obtained political representation and a modicum of political influence.

Faced with unions, strikes, political parties challenging their dominance, and the spread of squalid urban conventillos (the tenements housing workers and other migrants from the countryside), the elites began debating how to deal with “the social question.” Despite the evidence, some denied the existence of a problem. Conservative Congressman Eulogio Díaz Sagredo, for example, opined: “In truth it cannot be said that the worker problem or question which is the cause of so much worry in Europe has developed here.” In his book on the social question, Javier Díaz Lira laid the blame for the misery of the lower classes on “the enormous development of their vices.” Conservative Congressman Juan Enrique Concha declared the answer to be “social stewardship”: The wealthy should get to know the poor by visiting their workplaces and tenements to “make them see the absurdity of socialist utopias, and disabuse them of the false idea of economic equality by showing them there is a providential order which they must respect.” He further argued that the social question was not an economic matter, but “fundamentally a psychological, moral, and religious question, whose solution will be found, the world willing, only in the teaching of Christ.”³ While engaging in this sterile debate, Congress appointed commissions to investigate the social question and university students produced numerous theses on the issue, but those in power took no significant action to address what would soon become an urgent problem.

Toward the end of the era of the export economies, political change had again begun to transform Latin America. In a few countries, the challenges to elite rule that Chile faced after 1900 resulted in the enlargement of political systems to include, at least partially, the middle and working classes. Mexico was the first Latin American country in which an oligarchy lost its monopoly of power (Chapter 7). Uruguay was the second.

Uruguay’s export economy, like Argentina’s, was rural based. Its exports of wool, meat, and hides provided a modest prosperity, and light industry developed in the capital, Montevideo. Also as in Argentina, Uruguay’s scant population was overwhelmed by European immigrants, who pushed the total population to one million by 1900. Among this million were members of the new working and middle classes.

By the late nineteenth century, an oligarchy had emerged in Uruguay out of the early postindependence instability, civil wars, and caudillo rule. Two parties, the Blancos and the Colorados (whites and reds, but not the red associated with Communists), had developed—the Colorados being the stronger. Settled oligarchic rule began with four military presidents between 1876 and 1890, followed by civilians from 1890 to 1903. Then appeared José Batlle y Ordóñez.

Batlle y Ordóñez was the dominant political figure of Uruguay from his first presidency (1903–1907), through his second (1911–1915), to his death in 1929. He was a journalist who expounded advanced ideas and came up through the ranks of the Colorado party, serving in both the Chamber of Deputies and the Senate. Rather than breaking with his party, a pillar of the oligarchy, Batlle y Ordóñez worked within it to create a strong faction receptive to his progressive ideas. Astute maneuvering got the Congress, which in Uruguay elected the chief executive, to name him president in 1903.

Batlle y Ordóñez was a committed reformer who incorporated the middle and working classes into the political process, creating a modern welfare state. The changes he wrought made Uruguay by far the most socially and politically progressive country in South America, without the cataclysmic revolution that transformed Mexico after 1910. His accomplishments over two presidential terms included extending state participation in the economy, in areas such as banking, insurance, and electricity; free universal education; the eight-hour day for workers; retirement and old-age pensions; no-fault divorce; abolition of capital punishment; and separation of church and state. Although he wielded great authority as president, he feared the potential for abuse of power. Therefore, in 1918, he engineered the establishment of a collegiate executive, in which the president shared power with a nine-member National Council of Administration—a system similar to the Swiss form of plural executive. For this reason, along with its prosperity and advanced social legislation, post-oligarchic Uruguay was often referred to as the Switzerland of South America.

In Argentina, an oligarchy began to consolidate its control from the time of Bartolomé Mitre’s presidency (1862–1868). It established and retained control on the basis of voting restrictions, fraud, and the results it achieved: the spectacular economic development resulting from Argentina’s integration into the world market. The growing percentage of foreign-born, non-citizens in Argentina’s population, moreover, helped to keep the voting rolls lean. The oligarchy coalesced around the National Autonomist Party, founded in 1874 as a fusion of two parties representing the elites, and all presidents through 1916 came from its ranks.

As the economy developed, it greatly expanded both the middle and working classes. The Unión Cívica Radical, or Radical Party, was founded in 1890 to represent the middle class, while the Socialist Party, established six years later, aspired to represent the workers. The Radicals critiqued the oligarchy for its use of fraud and exclusion of most Argentines from political participation. Following its motto, “relentless struggle,” the Radical Party first tried rebellion against the system, failing in three attempts between 1893 and 1905. Thereafter, it turned to aggressive organizing, to the point that it became a mass-based party that threatened the oligarchy’s ability to retain direct power. Meanwhile, labor unions and strikes proliferated in the late nineteenth and early twentieth centuries among the disenfranchised workers, signaling another danger for elite interests.

By the early twentieth century, leaders of the National Autonomist Party became convinced that change was inevitable and that they should shape its course. Thus, in 1912, they enacted an electoral reform, the Sáenz Peña Law—named for the current president. The law established universal male suffrage for Argentine citizens, compulsory voting, and the secret ballot. As the naturalization process was slow and difficult, many foreign-born workers, including those who espoused radical ideas that the elites found dangerous, were not enfranchised, while the bulk of the middle class became voters. Hipólito Yrigoyen of the Radical Party was elected president in 1916, and Radicals held the presidency until a military coup in 1930. Thus following a different course than in Uruguay, the Argentine oligarchy also lost control of politics while retaining much influence.

In Chile, the oligarchy was forced to surrender its monopoly of political power in the face of radicalized working and middle classes. The First World War disrupted trade patterns within the global market, causing crises in most Latin American countries. Chile’s nitrate export economy was seriously affected, while prices of imported goods rose; the result was a dual crisis of unemployment and inflation. Focusing on food price inflation as a rallying point, labor and student leaders in 1918 formed the Workers’ Assembly of National Nutrition. This potent protest movement adopted a fifty-point program of social and political demands and mobilized hundreds of thousands of people throughout the country.

Against the backdrop of continuing economic crisis and political mobilization, the 1920 presidential election split the oligarchy into two factions: those opposed to making concessions to the protesters and those, led by veteran politician Arturo Alessandri Palma, who were willing to implement preemptive reforms to defuse the crisis. Alessandri’s narrow victory did not resolve matters; rather, it deepened the political instability that would characterize Chile in the 1920s and 1930s as the country adjusted to mass politics. Intransigents still controlled Congress, blocking Alessandri’s proposed social legislation, while the protesters continued to demonstrate and strike. The impasse was resolved in 1924 by military intervention—a rare occurrence in Chile—which not only prompted the president’s resignation but also forced Congress to enact reform legislation and adopt a new constitution. The 1925 constitution enhanced presidential authority, subordinated private property rights to the public good, and established the state’s commitment to social welfare for the working and middle classes.

Continuing economic problems and political disarray opened the way for a career army officer, Carlos Ibánez del Campo, to assume the presidency in 1927. During his four-year rule, he dominated Congress and launched the developmentalist and social welfare state that lasted in Chile until 1973. By the end of the era of the export economies in 1930, then, Chile was in flux, but it was clear that the oligarchy that had ruled for a century had lost its monopoly of power and control of the state.

The new political order that emerged during the era of the export economies included long-term dictatorships, elected oligarchic regimes, and political systems that had matured but not achieved full stability. Regardless of their configuration, these governments relied on professionalized armies which, aided by railroads and the telegraph, ended the age of caudillos in most countries. While the rich got richer from the bounty of exports, the colonial social order gave way to a more complex one featuring new working and middle classes and women entering the modern workplace. In a handful of countries, the working and middle classes gained sufficient influence to end the oligarchies’ monopoly of political power. By 1930, along with its economy, Latin America’s political and social landscape had undergone significant transformation.

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1. Paul S. Reinsch, “Parliamentary Government in Chile,” American Political Science Review 3, no. 4 (1909): 508.

2. Brian Loveman, Chile: The Legacy of Hispanic Capitalism, 3rd ed. (New York: Oxford University Press, 2001), 163.

3. James Oliver Morris, Elites, Intellectuals, and Consensus: A Study of the Social Question and the Industrial Relations System in Chile (Ithaca: New York State School of Industrial and Labor Relations, Cornell University, 1966), in order 177, 129–130, 126, 123.

5 Political Consolidation and Social Change