Latin America since Independence

This chapter examines developments between the onset of the Great Depression in 1930 and the beginning of Fidel Castro’s Cuban Revolution in 1959. This was a period of far-reaching transformations in Latin America’s economy, society, and politics. While the pace of change appeared to accelerate during these three decades, as always change was tempered by continuity with Latin America’s colonial past.

The U.S. stock market crash on October 24, 1929 (Black Thursday), rippled through the world by the following year. In Latin America, the Great Depression was a watershed event that closed out the era of the export economies and ushered in a new period of economic nationalism, social mobilization, and political change. Coming just over a decade after World War I had disrupted international trade, causing serious economic and social repercussions in Latin America, the Great Depression destroyed the intricate import–export patterns that had developed since the 1850s and coalesced by the 1880s into the first global economy. The collapse of the economies of the industrialized countries of Western Europe and North America greatly reduced demand for Latin America’s raw material exports. With diminished export earnings, Latin America could not continue to import the same volume of manufactured goods as in previous years.

The effects of the Great Depression in Latin America varied from country to country and, within some countries, from region to region, but overall they were severe: The value of most countries’ exports fell by half or more by 1932, and the volume of those exports declined as well. Cuba and Chile were among the hardest hit. Chile’s heavy dependence on mineral exports, copper and nitrates, deeply affected the country as manufacturing faltered in North America and Europe and agricultural producers reduced their use of nitrate fertilizer. The value of Cuba’s sugar harvest fell by three-quarters between 1929 and 1933, crippling the entire economy.

The Great Depression brought significant change in economic and social policies throughout much of the world. In the United States, President Franklin D. Roosevelt engineered the New Deal—a combination of economic stimulus and social programs for the working and middle classes. In Latin America, economists and political leaders embraced policies designed to reduce the exaggerated economic dependency that had arisen as a result of their reliance on raw material exports and whose deleterious effects were now wreaking havoc. Responses varied according to countries’ population size and degree of pre-Depression economic development. In the larger, more developed countries, governments adopted a policy of rapid industrialization, known as import-substituting industrialization (ISI), to produce goods that they could no longer afford to import. For Mexico, Brazil, and Argentina and to a lesser degree Chile, Peru, and Colombia, ISI offered the potential for local manufacture of formerly imported goods and for job growth to offset the Depression’s impact on employment. Thus, governments promoted the expansion of capacity in existing factories producing light consumer goods and the development of new manufacturing in steel, petrochemicals, durable consumer goods, and other heavy industries. In the smaller South and Central American and Caribbean countries, ISI was a less attractive option, as their smaller populations and lower income levels did not provide markets of sufficient size to provide economies of scale for manufacturing.

Because of high start-up costs and the difficulty of competing with imports, the new manufacturing sectors had to be constructed behind high protective tariffs. Abandoning nineteenth-century liberal laissez-faire economic doctrine, governments became heavily involved in directing the economies, often building infrastructure and investing directly in manufacturing plants. Some countries adopted Soviet-style five-year plans (or six-year plans in the case of Mexico, coinciding with presidential terms) for economic diversification and growth.

Governmental agencies, such as Chile’s Corporación de Fomento (Development Corporation, CORFO), Mexico’s Nacional Financiera (National Development Bank), and Argentina’s Instituto Argentino de Promoción del Intercambio (Argentine Institute for Trade Promotion, IAPI) were established in the 1930s and 1940s to stimulate the development of national industries and in many cases to own them. In Brazil, the government invested in various manufacturing enterprises, the most important of which was the Volta Redonda steel mill opened in 1946. These efforts brought substantial growth in the role of manufacturing in the larger countries’ economies: Between 1929 and 1957, industry as a percentage of GDP rose from 23 to 32 in Argentina, 14 to 22 in Mexico, 12 to 23 in Brazil, 8 to 20 in Chile, and 6 to 16 in Colombia while total industrial output skyrocketed. By the early 1960s, domestic industry supplied over 90 percent of consumer goods in Mexico, Brazil, and Argentina. The United Nation’s Economic Commission for Latin America (ECLA), founded in 1948 and led by Argentine economist Raúl Prebisch, consistently promoted ISI for the larger, more developed countries.

As manufacturing expanded after 1930, so did the working class that it employed. As the working class grew, it sought to build on the gains it had made previously in a few countries (Chapter 5), and unionization was the key to progress. National labor organizations predated the Great Depression in Mexico, Brazil, Argentina, and Chile, but with the growth of industry they gained power in national politics, particularly in Argentina and Mexico where labor leaders formed alliances with the dominant national parties. In Colombia and Peru, the labor movement split between Communist-affiliated and more conservative unions, while in Chile the Socialist and Communist parties vied for the support of organized labor. Regardless of the particulars, wherever significant industrialization occurred, the growth of labor organization translated into workers’ political power.

In the 1930s and 1940s, governments expanded or created agencies designed to adjudicate between labor and capital. This became an urgent task with the rise of new political groups and parties, including Soviet-sponsored Communist parties, that embraced anti-capitalist ideologies and radical solutions to the economic and social problems that accompanied the Depression. Thus, departments or ministries of labor were established or expanded and labor codes enacted or refined. Some governments did more to forestall potential labor unrest. Peruvian governments of the early 1930s, for example, created make-work projects, built worker housing, and opened subsidized worker diners while enacting new labor legislation and establishing a social security system for blue-collar workers. Chile, Mexico, Uruguay, Brazil, Argentina, and others built on earlier laws to expand their social security systems in the 1930s and 1940s. White-collar workers, a main component of the growing middle class, also gained social security benefits in the larger countries during the post-Depression period.

The lure of industrial jobs was a magnet for Latin America’s rural poor, who flocked to the cities in search of work and a better life. As a result, Latin America’s cities began a period of rapid growth that has continued to the present. Buenos Aires led the way, growing from 476,000 in 1930 to 6.7 million in 1960—an increase of 1,409 percent. Other capital cities also grew impressively, as did Brazil’s industrial center, São Paulo. By 1960, Latin America had four of the world’s fifteen largest metropolitan areas. Moving to the cities gave these millions of people access to better educational opportunities, and radio and—for some—television transcended the barrier of illiteracy, opening them to a wider world than they had known in the countryside. This burgeoning urban population provided a base for new political parties and movements that challenged the established order and gave rise to the phenomenon of populism.

The promise of a better life that attracted the rural masses proved elusive for many of them as the cities could not provide jobs for all, resulting in the expansion of a substratum of people without regular work. Whereas earlier rural-to-urban migrants had found quarters in the tenements in the city centers, the new arrivals were forced into makeshift housing that they constructed of scrap wood, tin, cardboard, and other scavenged materials in mushrooming slums, primarily on the cities’ outskirts. These migrants came from the impoverished interior of northeastern Brazil, the hinterlands of Argentina, the abandoned nitrate works in Chile, the Peruvian Andes, and rural Mexico; they normally were landless or, in the case of Mexico, lacked sufficient good land to achieve a decent standard of living. They formed favelas in Rio de Janeiro and São Paulo, villas miseria in Buenos Aires, callampas (mushrooms) in Santiago, barriadas in Lima, and colonias populares in Mexico City. These settlements were an important part of the urban scene by the 1950s and have continued to grow to the present.

Carolina Maria de Jesus, a black woman migrant from rural Brazil to a favela in Sao Paulo, left a rich account of life as a marginalized slum dweller in the diary she kept between 1955 and 1959. She lived with her three children in a rickety dwelling that she constructed of discarded materials and minimally furnished with salvaged articles, surrounded by dozens of migrants living in similar circumstances. The favela that she called home, Canindé, was one of a growing number of such settlements in Sao Paulo. A sober and responsible woman, she collected scrap paper and sold it for a pittance, foraged for the food she could not buy, and occasionally received charity from a church. She aspired to have her children receive an education, but encountered a common situation among Latin America’s extremely poor: While there was a primary school nearby, her children lacked proper shoes and clothing to be able to attend regularly. The dream that kept her going was to live in a brick house in a normal neighborhood. Hunger was her constant companion.

“Vera doesn’t have shoes and she doesn’t like to go barefoot.” (4)

“In the morning I’m always nervous. I’m afraid of not getting money to buy food to eat. But today is Monday and there is a lot of paper in the streets.” (42)

“Today is the birthday of my daughter Vera Eunice. I can’t give her a party for this would be just like trying to grab ahold of the sun with my hands. Today there’s not going to be any lunch. Only supper.” (85)

“I made coffee for João and José Carlos, who is ten years old today. I could only give him my congratulations, because I don’t even know if we are even going to eat today.” (97)

“Senhor Dorio was shocked with the primitive way I live. But he must learn that a favela is the garbage dump of São Paulo, and that I am just a piece of garbage.” (135)

“I got out of bed at 4 a.m. and went to carry water, then went to wash clothes. I didn’t make lunch. There is no rice.” (138)

“When I find something in the garbage that I can eat, I eat it. I don’t have the courage to kill myself. And I refuse to die of hunger!” (149)

“I told the children that today we were not going to eat. They were unhappy.” (171)

Source: Carolina Maria de Jesus, Child of the Dark: The Diary of Carolina Maria de Jesus, translated by David St. Clair (New York: Signet, 2003).

The collapse of the Latin American economies precipitated political instability and social mobilizations that many governments were unable to control. Thus within three years of the onset of Depression, the majority of Latin American countries experienced military coups. In some cases, the military regimes were short-lived; such was the case in Chile, where in 1932 a military faction overthrew the government, established a one-hundred-day “Socialist Republic,” and gave way to a new elected government the same year. In other cases, such as Argentina, military or militarydominated regimes not only retained power for several years, but also developed a pattern of frequently displacing elected governments for decades to come. In Peru, military governments established in the aftermath of economic collapse ruled off and on into the 1970s. Rather than restoring stability, the 1931 military coup in Ecuador led to a parade of nineteen presidents in the next seventeen years, none of whom finished his term.

In the Dominican Republic, a 1930 coup paved the way for thirty-one years of dominance by Rafael Trujillo. Trujillo had served in the National Guard that the United States created before withdrawing from its long-term occupation in 1924, and quickly rose to head the force. Whether serving as president (1930–1938 and 1942–1952) or pulling his puppets’ strings, Trujillo ruled with an iron fist, brutally repressed his enemies, and massacred thousands of immigrant Haitian workers in 1937. Part of his success came from the cult of personality that he developed: He made himself the country’s patriarch without whose blessing nothing could be done; bestowed upon himself dozens of official titles, including “Great Benefactor of the Nation” and “The First and Greatest of the Dominican Heads of State”; and even renamed the Western Hemisphere’s oldest European city, Santo Domingo, as Ciudad Trujillo. Trujillo was assassinated in 1961.

Nicaragua’s Anastasio Somoza García was another dictator who parlayed command of a U.S.-created “nonpolitical” constabulary into long-term rule. The U.S. occupation force created the National Guard to replace the highly politicized Nicaraguan army before withdrawing in 1933 and named the affable, English-speaking Somoza its commander. Within three years, Somoza assassinated Augusto César Sandino (Chapter 6), purged the National Guard’s officer corps of Conservatives, installed fellow Liberals in their places, and assumed the presidency. He ruled as a heavy-handed dictator until his 1956 assassination; he was succeeded by two sons, Luis Somoza De-beyle and Anastasio “Tachito” Somoza Debayle, who kept Nicaragua in family hands until the Sandinista revolution of 1979. During the forty-three years of family rule, the Somozas occasionally allowed trusted lieutenants to wear the presidential sash, but no one other than a Somoza ever commanded the National Guard—their personal armed force. They also counted on unwavering U.S. support, regardless of the repression that the family consistently used to maintain control. The power they wielded allowed the Somozas to acquire great personal wealth; by the time he was overthrown in 1979, Tachito reputedly owned one-fourth of the Nicaraguan economy.

As authoritarian governance surged after 1930 under military dictators, Costa Rica moved in the opposite direction. Following a disputed 1948 election, rebel groups led by José Figueres prevailed after a few weeks over the national army, and Figueres presided over a junta that restored order. The junta enacted several reforms, none more important than the abolition of the army—a measure imbedded in a new constitution adopted in 1949. While retaining a small force for internal security, the government redirected the military budget to education and public health, in the process cementing Costa Rica’s credentials as one of Latin America’s most enduring democracies.

The unsettled political climate brought on by the Great Depression gave rise in a few countries to a new phenomenon: populism. Populism was based on alliances between organized labor and the new industrial elite, often with middle-class support, and the partial exclusion of the agrarian and mining interests that had been the backbone of the export economies. Labor support was premised on the delivery of improved wages and living standards, while private sector industrialists backed leaders who provided conditions, such as tariffs and new infrastructure, necessary for the growth of manufacturing. Balancing these groups were powerful, usually charismatic presidents who used authoritarian governance and nationalist rhetoric and actions to keep the alliance intact and to repress proponents of more radical change. In some cases, the armed forces constituted integral parts of the populist coalitions.

In Mexico, Lázaro Cárdenas’s government (Chapter 7) was a populist coalition that extended beyond the working class to incorporate the peasantry as well. Brazil under Getálio Vargas (1930–1945) provided another example of populism. After coming to power through a military coup, Vargas adopted policies to promote economic development and favor the growing urban labor force, in the process shifting power to the central government and away from the oligarchic state political machines that dominated the country during the First Republic (1889–1930) (Chapter 5). In 1937, he instituted the authoritarian Estado Nôvo, or New State, a semi-corporatist government that borrowed organizational principles from Benito Musollini’s Italy. Among Vargas’s most notable development projects were the Volta Redonda steel mill, noted earlier, and the state-owned oil company, Petrobras. He also nationalized the power and telephone services. He showered benefits on the workers he organized into unions and recruited into the Labor Party founded late in his tenure, delivering social security, a forty-eight-hour work week, paid vacations, and a minimum wage. Although it did not participate directly in governance, the military also propped up the Vargas regime until the winds of democracy generated by the Allied victory over fascism in World War II made his continuance in office untenable. Vargas was elected to a new term in 1950 but could not reassemble his earlier coalition and was overthrown in 1954, leading to his suicide.

The government of Juan Domingo Perón in Argentina (1946–1955) was the most complete expression of a populist regime. Perón’s rise to power was grounded in the 1930 military coup that overthrew the middle-class Radical Party government of Hipólito Yrigoyen (Chapter 5). Driven by the Great Depression and the military leadership’s antidemocratic attitude and ambition for power, the coup led to a sixteen-year period of alternating military and civilian governments. With the outbreak of World War II, Argentines were torn between support for the Axis Powers (Nazi Germany, Italy, and Japan)—a position strongly held within the military—and the critical importance of the British market for Argentine exports. Concurrently, industrial growth expanded the working class, which had developed little political power because a great portion of workers were immigrants and hence noncitizens and nonvoters. But with the Great Depression halting the flow of immigrants to Argentina and the passage of time, most of the working class by 1940 was native-born but still underrepresented in the political arena.

Led by General Arturo Rawson, the military took power again in 1943 and, following the fascist model, banned political parties the following year. The fifty-year-old colonel Perón had achieved influence in the tight-knit group that engineered the coup, the Grupo de Oficiales Unidos (United Officers’ Group). He was rewarded with the seemingly unimportant post of head of the Department of Labor and Social Security and used his position to court labor by promoting unionization, supporting strikes, and delivering benefits. As his power grew, he was promoted to minister of war and vice president, but apprehensive about his rapidly rising influence, his military colleagues arrested him in October 1945. At this point his wife, Eva Perón, and his labor support saved him; rallied by Evita (as she was known), workers marched and threatened mayhem until their patron was released. From that point, Perón consolidated his power within the military, continued building strength with labor, and won the 1946 presidential election with 54 percent of the vote. Thus began Peronismo, a unique phenomenon that continues to be strong today.

As it developed, Peronism was a blend of populism, nationalism, and authoritarianism, based on the twin pillars of labor and the military. Perón continued cultivating labor support by delivering benefits and dignifying workers. Evita’s popularity and charisma and her personal connection with the poor, who were known as descamisados (shirtless ones), were essential to Perón’s success with the masses. During Perón’s nine years in power, the number of unionized workers quintupled from around 500,000 to 2.5 million; they included shoe shiners, kitchen workers, teachers, bureaucrats, and many others not employed in industry, all affiliated with the Confederación General de Trabajadores (General Confederation of Workers, CGT). With the state consistently resolving strikes on labor’s terms and Perón’s establishment of a mandatory Christmas bonus, workers’ real wages rose by approximately a third within a few years.

Perón’s nationalism was designed to enhance Argentina’s international power and prestige and to wrest control of the economy from foreign interests, particularly the British. The two approaches went hand in hand, as a robust nationally controlled economy would provide the means to project Argentine power abroad. Of particular concern was the rise of Brazilian military power as a result of U.S aid to the neighboring country in return for its support of the Allies in World War II. A broader issue was the relative decline of Argentine influence as the United States emerged as the clear hemispheric leader.

Perón launched a five-year plan for rapid economic development in 1947, the same year that he paid off Argentina’s entire foreign debt and declared the country’s economic independence, as Cárdenas had done for Mexico in 1938. Central to the five-year plan was the establishment of IAPI, which created a monopoly over agricultural exports, paid producers low prices, sold the commodities at high postwar prices, and delivered the profit to the state for economic and social programs and for enhancing an arms industry. In 1948, the government purchased the British-owned railroads, U.S.-owned utilities, and French-owned dock facilities. In a bid to translate economic nationalism into international prestige, Argentina’s representative at the United Nations offered five billion dollars for Latin American development—a forerunner of the later U.S. Alliance for Progress (Chapter 10).

Although grounded in law and elections, Peronism was also authoritarian; Perón relied on enforcers to crush dissent and opposition. His popularity assured majority support in Congress, facilitating the enactment of legislation enhancing his powers. In 1947, he founded his own party, the Partido Justicialista, which featured an elaborate ideology called justicialismo (untranslatable, but focused on justice) that staked out a position between capitalism and socialism. Justicialismo was supposed to mediate among four forces in conflict—idealism and materialism, and collectivism and individualism—and yield outcomes beneficial to the new Argentina that Perón was creating. Forbidden by the constitution from seeking a second presidential term, Perón had the pliant Congress revise it; he was reelected in 1951 with over 60 percent of the vote.

The authoritarian system under construction also relied on cults of personality, of the president himself but particularly of his wife Evita, a former radio actress. Using her charisma, her almost magical bond with the common people, and her Evita Perón Foundation, she kept the masses loyal to her husband and his policies. The foundation, which used both public and donated funds to deliver generous amounts of goods to workers and their families, was created after the traditional female-run Sociedad de Beneficencia (philanthropic society) refused to name her honorary president, as it had done for first ladies since its founding in the 1820s. She also established the Feminist Peronist Party, whose efforts in favor of women’s suffrage bore fruit in 1949. Being able to deliver goods and interact on a familiar basis with the descamisados and other ordinary Argentines made Evita an immensely powerful figure of an almost saintly nature, reflected in her designation as “spiritual chief of the nation” by Congress.

Perón’s 1951 reelection marked the pinnacle of Peronism. The regime’s success relied on the high prices that Argentine food products commanded in a war-ravaged Europe that relied heavily on imports, and on the transfer of export profits to the state through IAPI. By 1951, prices had fallen and export income dropped severely, cutting into workers’ gains. Two developments in 1951 foretold trouble: a failed military conspiracy and a strike against a state-owned firm. The following year, Perón suffered a huge loss when Evita died of cancer at age 33; her loyal followers launched a campaign to have her canonized. In 1953, Perón adopted more orthodox economic policies that required worker financial sacrifices. He turned on the Catholic Church in 1954 by legalizing divorce and taking over religious primary schools, for which he was excommunicated. When the church tried to organize Catholic unions to compete with Perón’s CGT, Peronist mobs burned several churches, creating an unbridgeable chasm between the church and Peronism. As the regime’s decline accelerated, the military demanded Perón’s resignation in 1955 and he left for exile in Spain. Juan and Evita Perón were gone, but their influence was not.

Despite breakthroughs in employment and education during the era of the export economies, women still lived under patriarchal colonial-era legal restrictions in family and civil matters. Typically, married women’s property rights were very limited or nonexistent; women could not independently take legal actions; and the husband controlled a wife’s earnings and the couple’s children. Only three countries reformed their civil codes to expand women’s legal rights before 1930: Mexico and Cuba in 1917 and Argentina in 1926. Only one country enfranchised women during the period of the export economies, but not as a result of women’s advocacy: Ecuador granted women the right to vote in 1929 because conservatives believed that they could count on them, considered obedient to the Catholic Church, to hold off rising demands for reform.

While the issue of women’s suffrage had occasionally arisen in the press and in congressional debates since the late nineteenth century, the roots of the suffrage movements were found in the feminist organizations of the early twentieth century. The First International Feminist Congress, held in Buenos Aires in 1910, drew participants from Peru, Chile, Uruguay, Italy, and the United States. The National Feminist Union was founded in Buenos Aires in 1918, and a successor, the Women’s Rights Association, counted eleven thousand members. Brazil, Chile, Peru, and Mexico were also the scenes of early feminist organizing. During the Mexican Revolution, the state of Yucatán under progressive governors Salvador Alvarado and Felipe Carrillo Puerto hosted women’s congresses in 1916 and 1921 and even allowed women to vote, but Carrillo Puerto’s assassination in 1923 ended the experimentation.

Most early feminist organizations were directed by upper-class and educated middle-class women who did not directly challenge their primary role in the home or their marginalization from public life. Rather, they focused on issues such as women’s education, child welfare, and private and public morality, while parallel working-class feminist organizations advocated for women’s labor issues. A number of factors converging during and after World War I created new suffrage organizations and reoriented some of the original feminist groups toward suffrage advocacy. The wartime disruption of the world economy and the resulting economic and social crises radicalized significant elements of the populations, including some working- and middle-class women. In 1920, the United States ratified the nineteenth amendment to its constitution, bringing a long struggle for women’s vote to a successful conclusion. After suffrage became a political issue in some countries, the Pan American Union began to advocate for it. In 1928, it established the Inter-American Commission of Women to gather data for consideration at subsequent meetings. In 1938, after four countries had enacted women’s suffrage, the Pan American Union formally resolved that women should have the same political rights as men.

Other than in Ecuador, suffrage followed concerted, often lengthy campaigns by women and some male supporters. In Costa Rica, the issue was debated in the 1919 constituent assembly. Serious, ongoing advocacy began in 1923 with the founding of the Feminist League and the Reformist Party, but it was not until the aftermath of the 1948 civil war that women achieved victory. The 1949 constitution included a number of progressive provisions, including women’s suffrage along with the definitive abolition of the national army.

In Cuba, the constitutional assembly that met during the failed first independence war (1868–1878) considered enfranchising the mambisas (or women independence fighters), but ultimately rejected the idea. Despite his general progressivism, José Martí, initial leader of the second independence war (1895–1898), opposed extending the vote to women. The first suffragist organization, the Feminine Club, was founded in 1917; by 1923, six organizations representing different sectors of Cuban women merged into the National Federation of Feminist Associations. The Great Depression brought the radicalization of numerous citizens and their organizations and led to the 1933 overthrow of long-time dictator Gerardo Machado. His replacement as president, Ramón Grau San Martín, decreed a number of progressive measures, including the female vote, which was first exercised in 1936. Cuban women made other gains in the 1930s, including a law prohibiting discrimination in employment and elimination of the adultery law that gave men the right to kill wives for having extramarital relations. The 1940 constitution definitively enshrined women’s suffrage.

In South America, women achieved the vote in different ways. The city of Buenos Aires gave women voting rights for municipal elections in 1917, but denied them the right to hold the offices for which they voted. Uruguayan and Brazilian women were the first to gain full voting rights, both in 1932. In Chile, the process was incremental. Under pressure from suffragists, Chile granted women the right to vote and hold office at the municipal level in 1935; in the first subsequent election, twenty-five of ninety-eight women candidates were elected to municipal office. Full voting and office-holding rights were granted in 1949, after a fourteen-year trial period of testing female civic capabilities. In 1961, Paraguay became the last Latin American country to enact women’s suffrage.

Over the three decades of enfranchisement, women clearly gained ground in the struggle for equality with men. By 1961, they could vote in all elections and hold any office. But in many countries, the civil codes still included some of the colonial patrimonial restrictions that placed women in an inferior legal position. And literacy requirements for voting continued to deny women as well as men citizenship rights in several countries. Success in the struggle for suffrage opened important doors for women, but others remained closed.

Latin America’s second true revolution took place in Bolivia. Landlocked since losing its Pacific littoral to Chile in the War of the Pacific (1879–1883), the Andean country followed the common pattern of transitioning from caudillo rule to a system of stable oligarchic governance that featured the forms but not the substance of democracy. The franchise was extremely limited and Indians, who constituted two-thirds of the population, were not considered citizens. In common with other countries having traditions of communal indigenous landholding, Bolivia experienced a massive transfer of Indian lands to the elites when it entered the world market through its mineral exports (Chapter 4). From 1880 to 1900, the primary export was silver; from 1900 on, it was tin, of which Bolivia was the world’s major supplier. Control of the political system shifted from conservatives to liberals with the rise of the tin export economy, but that change made no difference to the Indian majority or the urban population of mestizos: They continued to be economically, socially, and politically marginalized—aliens in their own country.

The oligarchic system experienced a minor shift in 1920, when dissident liberals organized as the Republican Union took power and enacted the country’s first minimal labor and social legislation. The Depression eroded the market for tin, seriously affecting the national economy. Following the time-honored practice of going to war as a distraction from domestic problems, in 1932 President David Salamanca ordered an attack on Paraguayan garrisons in the low-lying, lightly inhabited Chaco region claimed by both countries. With a German-trained army and Paraguay still suffering the lingering effects of its decimation in the Paraguayan War (1864–1870), Salamanca and most Bolivians expected an easy victory, but the offensive faltered owing to overextended supply lines, poor military leadership, and determined Paraguayan resistance. To bolster the ten-thousand-man army, Salamanca resorted to mass conscription of over two hundred fifty thousand men, mostly Indians: The levy amounted to one in five Bolivian males, or half the male population of fighting age. These conscripts were sent to the front lines, where nearly a quarter of them were killed, another thirty-Cive thousand injured or maimed, and some four thousand captured; ten thousand more deserted. At the conflict’s end in 1935, Bolivia lost most of its Chaco territory to Paraguay.

The slaughter and Bolivia’s loss in the Chaco War began the unraveling of the oligarchy’s control. The small urban middle and working classes and elements of the army experienced bitter disillusionment, and in the wake of a losing war, the normal discussion began: What is wrong with Bolivia? As a veteran put it, “The drama of the Chaco opened a wide furrow in our consciousness. The generation prior to 1932 speak one language; those who come after an entirely different one.”¹ The “Chaco generation” began to challenge the status quo. Elements of the dissident officer corps—led by David Toro and Germán Busch—seized power in 1936, ended the oligarchy’s absolute monopoly of power, and over the next three years enacted progressive reforms for labor and the middle class. Concurrently, two new left parties were founded to represent the tin miners and urban workers. In addition, a moderate reformist party, the Movimiento Nacionalista Revolucionario (Nationalist Revolutionary Movement, MNR), was established in 1940 and developed a substantial following among the middle class. Despite these developments, only fifty-eight thousand of the country’s two million people voted in the 1940 election.

Indians returning to the haciendas or ayllus from which they had been conscripted for cannon fodder also viewed their world differently. They had been forced to fight under horrible conditions for a country that did not recognize them as citizens and that had stripped them of their land and reduced them to servitude. The war experience brought together for the first time Quechua, Aymara, and members of smaller native ethnicities and revealed to them the commonality of their degraded condition. Returning veterans began forming rural Indian sindicatos (or unions) that provided organization and pressured local hacendados for improved working conditions.

Several developments during the 1940s built momentum for change. In 1942, government troops massacred dozens of striking tin miners at Catavi. The following year, tin miners formed their first national union. In 1945, the MNR and a short-lived reformist government sponsored a first-ever Congreso Indígena (Indian Congress) attended by a thousand native leaders from around the country. This gathering provided a voice for Indians’ grievances and further raised consciousness of their marginalization. The postwar decline in tin prices led to the furlough of thousands of tin miners in 1947; returning to their native villages, they spread revolutionary ideas learned from the left parties that had proselytized in the mines. A rebellion of hundreds of hacienda workers took place the same year in the Cochabamba Valley.

Ethnic composition: Quechua 30%, Aymara 25%, other indigenous 3%, mestizo 30%, and white 12% (author’s estimates)

Religious affiliations (nominal): Catholic 76.8%, Protestant 16%, other 1.7%, and none 5.5%

Household income (proportion in the highest and lowest 10%): highest 33.6% and lowest 0.8%

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

After a decade of accumulating support, the MNR won the 1951 presidential election but a military coup prevented its candidate, Víctor Paz Estenssoro, from taking office. After months of standoff, the MNR launched a rebellion against the military junta in the capital, La Paz, on April 9, 1952. The rebels exploited continuing divisions within the army and were joined by police and civilians armed from captured arsenals. On the third day, the arrival of armed tin miners in La Paz turned the tide in favor of the rebels, dispersing the army and installing Paz Estenssoro as president.

Rebellion morphed into a revolution in three basic steps. The first was the immediate elimination of the literacy requirement for voting, which enfranchised the Indian masses and turned a tottering oligarchic regime into a political democracy. A few months later, the new government nationalized the three largest tin companies—which accounted for over two-thirds of national production—and folded them into a state tin corporation, COMIBOL, thus bringing the major part of Bolivia’s export sector under state ownership. The third step in the revolution was carried out from the ground up. With the collapse of the military regime, Indians living on haciendas across much of the country rebelled, drove the owners off the land, and occupied or burned the haciendas, reversing the nineteenth-century appropriation of their lands. The new government had not anticipated this radical turn of events, but in August 1953 issued an agrarian reform decree that provided a legal basis for the de facto agrarian reform carried out by the Indians.

Bolivia after 1952–1953 remained one of Latin America’s poorest countries, but the revolution changed it profoundly. While Indians remained at the bottom of the social pyramid, most were no longer exploited by landowners and were able to make the most of the land they recovered. Nationalization of the large tin mining companies placed Bolivia’s major natural resource and export commodity under government ownership, allowing for socialization of the income that formerly had gone to private hands. The overnight incorporation of the native masses into national politics abruptly ended oligarchic control. Like the Mexican Revolution and unlike the Cuban (Chapter 9), the Bolivian Revolution did not replace capitalism with socialism. Like the Mexican, it did not completely destroy the upper class, but opened the way for increased social mobility. And it established a political democracy that, although occasionally interrupted by military coups, opened the political arena to the previously marginalized Indian majority. The revolution had much to do with the failure of Che Guevara’s guerrilla movement in Bolivia (Chapter 10) and with the election of Latin America’s first Indian president to openly embrace his ethnicity, Evo Morales (Chapter 12).

In 1933, President Franklin D. Roosevelt declared an end to U.S. military intervention in Latin America, which had been focused on the Caribbean Basin. Reversing the policy inaugurated by his cousin Theodore Roosevelt, Franklin Roosevelt declared in his inaugural address: “In the field of world policy, I would dedicate this nation to the policy of the good neighbor—the neighbor who resolutely respects himself and, because he does so, respects the rights of others.”² His secretary of state, Cordell Hull, affirmed at the 1933 Montevideo OAS (Organization of American States) meeting that the United States had renounced intervention. Warmly welcomed in Latin America, the Good Neighbor Policy had a short life span: It conflicted with a new and pressing development.

Between the end of World War II and the 1991 collapse of the Soviet Union, the United States and its allies confronted the Soviet Union and its supporters in a tense international standoff, the Cold War. Although they had cooperated to defeat Nazi Germany, Italy, and Japan, the U.S.–USSR (Union of Soviet Socialist Republics) alliance ended as the Soviet Union imposed postwar dominance on Eastern Europe. As cooperation gave way to fierce competition between the former allies, the Soviet Union aggressively pushed to extend its influence to the developing world of Africa, Asia, and Latin America. The United States responded forcefully, Latin America became a theater in the Cold War, and the days of the Good Neighbor Policy were numbered.

The United States pursued its anti-Communist strategy in Latin America through a variety of means. U.S. military policy, formalized in the 1947 Rio de Janeiro Treaty, was designed to assure collective hemispheric security against external aggression by the Soviet Union. To implement the treaty, the United States began establishing military missions in each country, training Latin American officers in methods of conventional warfare at service schools in the United States and the Panama Canal Zone, and providing surplus World War II equipment to the region’s armed forces. But given the remoteness of Latin America from the center of the Cold War conflict and the unlikelihood of a Soviet invasion, the military buildup also focused on internal security against Communist penetration (Chapter 11).

The United States also pressured Latin American governments to ban Communist parties, Communist-influenced labor unions, and other entities considered “Communist front organizations.” By 1948, Communist parties had been outlawed in eight countries, in some of which elected members of national, provincial, and local legislative bodies were removed from office. The United States also urged Latin American governments to break relations with the USSR and thereby eliminate an irritating and potentially subversive influence. Twelve of the fifteen countries that had established diplomatic relations with the Soviet Union broke them by the mid-1950s.

Guatemala became the first test case of U.S. resolve to keep Communist influence out of the Western Hemisphere. General Jorge Ubico, who seized power as the Great Depression destabilized the country in 1931 and ruled as a dictator, was driven from office in 1944. His successor was progressive Juan José Arévalo, who allied himself with moderate and leftist elements and enacted labor and social reforms, including establishment of a social security program. Jacobo Árbenz, a leftist more committed than his predecessor to reform, was elected president in 1950. Whereas Arévalo’s reforms had focused on urban labor, Árbenz set his sights on economic and social change in backward and impoverished rural Guatemala. And although not a Communist himself, Árbenz was on good terms with the growing Guatemalan Communist Party and appointed some of its members and allies to posts in his administration.

Enacted in 1952, Árbenz’s agrarian reform law was moderate, calling only for expropriation of unused portions of large holdings; within eighteen months, 1.5 million acres were distributed to around one hundred thousand families, although legal formalities involving the transfer of titles to the recipients were not complete. As was its practice throughout Central America and beyond, the United Fruit Company (UFCO) had secured huge tracts of land in the lowlands and kept large parts of them in reserve for future cultivation. This made UFCO property a target of the agrarian reform agency. The agrarian reform law authorized compensation in bonds for expropriated land based on its value as declared for tax purposes. As UFCO undervalued its lands to keep its taxes low, the government offered $628,000 in bonds while the company and the U.S. State Department demanded $15.9 million. It was no accident that Secretary of State John Foster Dulles and his brother, CIA director Allen Dulles, were closely associated with the law firm that represented the company.

An ardent nationalist, Árbenz was committed to asserting Guatemala’s sovereignty by following an independent course in foreign policy. In the bipolar world of the 1950s, that meant sometimes siding with the USSR at the United Nations. In the United States, both government and private voices sounded the alarm: Guatemala was going Communist. Indeed, Árbenz had violated the two cardinal rules of behavior that the United States laid down for Latin American countries in the Cold War: He expropriated U.S.-owned property without prompt and adequate compensation, as determined by the United States; and he had shown himself to be, in the lexicon of the time, “soft on communism.”

Consequently, a drumbeat arose in the United States for action against Árbenz; in the words of a prominent magazine writer, “The battle of the Western Hemisphere has begun.”³ At the March 1954 OAS meeting in Caracas, Secretary Dulles secured passage—over several countries’ objections—of a Cold War corollary to the Monroe Doctrine. In the original, President James Monroe asserted that the institution of monarchy was incompatible with the predominantly republican Western Hemisphere (Chapter 6); the updated version, the Declaration of Caracas, held that “the domination or control of the political institutions of any American state by the international communist movement … would constitute a threat to the sovereignty and political independence of the American states, endangering the peace of America.”⁴ This revision of the Monroe Doctrine, substituting communism for monarchy as the enemy, nullified the Good Neighbor Policy and would serve as justification for the U.S.-sponsored overthrow of Árbenz and for dozens of overt and covert interventions throughout the hemisphere over the next thirty-five years.

Faced with growing internal opposition and the threat of U.S. military action, Árbenz ordered a shipment of arms from Communist Czechoslovakia, which arrived at Puerto Barrios in May 1954. To the U.S. government, this confirmed Árbenz’s Communist credentials and required his removal. Following an intense CIA-directed propaganda and psychological warfare campaign, a small CIA–trained and equipped invasion force assembled in neighboring Honduras. When the invaders crossed into Guatemala, the army refused to engage them and Árbenz resigned, blaming UFCO and the United States for his ouster. The leader of the invasion—Colonel Carlos Castillo Armas—t ook power, annulled the past ten years’ reforms, resumed the Guatemalan tradition of dictatorship, and plunged the country into a decades-long abyss of violence.

The overthrow of Árbenz was a dress rehearsal for the U.S. approach to dealing with Fidel Castro’s Cuba and other political movements that would challenge U.S. hegemony in the coming decades. The return to U.S. interventionism, only two decades after Franklin D. Roosevelt had foresworn it, became the Cold War reality in Latin America.

The Great Depression crippled the global economy, causing economic and social crises that undermined civilian governments and ushered in military regimes. The Depression also gave rise to new strategies of state-driven industrialization in the larger countries. The growth of industry increased the size and power of the working class, while the lure of industrial jobs promoted large-scale rural-to-urban migration that ended for many in the burgeoning city slums. Populist regimes supported by the working and middle classes appeared in several countries. Women gained the franchise, and Bolivia experienced revolution. The Cold War entered the region, resulting in the abandonment of the Good Neighbor Policy and the resumption of U.S. military intervention in Latin America, beginning with Guatemala in 1954.

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Cardoso, Fernando Henrique and Enzo Faletto. Dependency and Development in Latin America. Translated by Marjory Mattingly Urquidi. Berkeley: University of California Press, 1979.

Crassweller, Robert D. Perón and the Enigmas of Argentina. New York: Norton, 1987.

de Jesus, Carolina Maria. Child of the Dark: The Diary of Carolina Maria de Jesus. Translated by David St. Clair. New York: Signet, 2003.

Drinot, Paulo and Alan Knight, eds. The Great Depression in Latin America. Durham, NC: Duke University Press, 2014.

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Hammond, Gregory. The Women‘s Suffrage Movement and Feminism in Argentina from Roca to Perón. Albuquerque: University of New Mexico Press, 2011.

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Miller, Francesca. Latin American Women and the Search for Social Justice. Hanover, NH: University Press of New England, 1991.

Schlesinger, Stephen and Stephen Kinzer. Bitter Fruit: The Story of the American Coup in Guatemala. Rev. and expanded ed. Cambridge, MA: David Rockefeller Center for Latin American Studies, Harvard University, 2005.

Stoner, K. Lynn. From the House to the Streets: The Cuban Woman‘s Movement for Legal Reform, 1898–1940. Durham, NC: Duke University Press, 1991.

Tamarin, David. The Argentine Labor Movement, 1930–1945: A Study in the Origins of Peronism. Albuquerque: University of New Mexico Press, 1985.

1. Herbert S. Klein, Parties and Political Change in Bolivia, 1880–1952 (Cambridge, UK: Cambridge University Press, 1969), 189.

3. Peter H. Smith, Talons of the Eagle: Latin America, the United States, and the World, 4th ed. (New York: Oxford University Press, 2013), 152.

Reflections on the Colonial Legacies, 1930–1959

The legacy of authoritarian governance was strengthened during most of the 1930–1959 period. Facing the severe economic and social crises created by the Great Depression, civilian governments gave way to military regimes in over half of the Latin American countries. In Mexico, the reaction against Porfirio Díaz’s authoritarian rule led to a democratic constitution, but despite Lázaro Cárdenas’s incorporation of workers and peasants into the party, the outcome of the revolution was a single-party system that operated in top-down fashion. In Argentina and Brazil, some of the progressives who had previously opposed authoritarian governance embraced Juan Domingo Perón and Getúlio Vargas for the material benefits they offered the working and middle classes. The U.S.-orchestrated overthrow of Jacobo Árbenz’s government ended Guatemala’s brief experiment with democracy. On the other hand, democratization advanced with the abolition of the Costa Rican military and the Bolivian Revolution’s adoption of universal suffrage. The rise of democratically elected civilian governments in the 1950s, however, was short-lived.

The colonial legacy of a rigid social hierarchy continued with some modifications. The economic strategy of import-substituting industrialization expanded and empowered the working class in the larger countries, and campesinos benefited from agrarian reform in Mexico and Bolivia. Drawn by the prospect of better lives, the rural poor throughout Latin America flocked to the cities, but many ended up as did Carolina María de Jesus in the burgeoning slums. Those who remained behind in the countryside continued their humble existence. Winning the right to vote between 1929 and 1961 opened the way to fuller women’s civic participation, but not to significant gains in officeholding at the national level.

The Great Depression shattered the illusion that the export economies were Latin America’s path to development and prosperity. The policy of state-driven development was designed to generate growth and reduce the dependency unmasked by the collapse of the world economy. This strategy made Latin America’s larger economies more self-sufficient but, given the ongoing need to import capital and technology, economic dependency persisted in modified form while the smaller countries continued to rely primarily on raw material exports.

The colonial legacy of the large landed estate, extended and reinforced during the era of the export economies, changed little except in Mexico and Bolivia, where agrarian reform was at the heart of those countries’ revolutions. Agrarian reform in Guatemala, which targeted United Fruit Company lands, was reversed following the 1954 overthrow of the Árbenz government.

The residual power of the Roman Catholic Church continued with little change except in Mexico, where the revolution earlier had revived the anticlerical impulse manifested in La Reforma of the 1850s and took further steps to reduce the church’s power and influence. Following the 1926–1929 Cristero Rebellion, persecution of the church in Mexico eased but continued in isolated instances such as in the state of Tabasco.

8 Depression, Political Change, and Cold War

Reflections on the Colonial Legacies, 1930–1959