THE WEAPONS OF “FREE” TRADE & “FREE” MARKETS
from OPEN VEINS, Galeano
In 1812, British traders were reporting to the Foreign Office that, in Argentina, they had succeeded in replacing German and French textiles, and Argentina’s domestic production as well, which was strangled by the “free-trade” port. The same occurred, with variations, elsewhere in Latin America.
From Yorkshire, Lancashire, the Cheviot Hills, and Wales poured an endless stream of cotton and woolens, iron and leather, wood and porcelain goods. Manchester’s looms, Sheffield’s foundries, Worcester and Staffordshire potteries flooded Latin American markets. Free trade enriched the ports which lived from exports, lifted sky-high the extravagance of oligarchies determined to enjoy every known luxury [tolerated by the colonial masters as a perk for the overlords as long as they kept the population in line] but ruined budding local manufacture [deliberately] and frustrated expansion of the internal market. Latin American manufactures continued fitfully, with one foot in the grave and with no possibility of sustained long-term development.
In Chile, one of Spain’s most far-flung possessions, isolation at first favored the development of industrial activity from the beginnings of colonial life. It had spinning mills, textile mills, and tanneries; all the ships of the South Seas were equipped with Chilean rigging and cordage; it manufactured metal objects, from retorts and guns to ornaments, fine tableware, and clocks, and built boats and vehicles. But, like Brazil’s textile and metal works, which took their modest first steps in the eighteenth century, they were wiped out by foreign imports. Latin America’s big ports, through which the wealth of its soil and subsoil passed en route to distant centers of power, were being built up as instruments of the conquest and domination of the countries to which they belonged, and as conduits through which to drain the nations’ income. While ports and capitals strove to be like Paris or London, behind them stretched the desert. In the twentieth century peasants flee from their villages in the mountains and on the plains and flood into Buenos Aires to offer their labor: like the peasants of other poor provinces, they get no further than the city’s outskirts, where they settle down beside 700,000 other inhabitants of the “villas miserias” and make out as best they can with crumbs from the great capital’s banquet table.
“Fortune” magazine, in 1967, assessed the “enticing new opportunities” which the Latin American Common Market opens to northern business: “In many a boardroom, the common market is becoming a serious element in planning for the future. The magazine cited examples of “rationalizing” or “expanding” operations by corporations such as ITT, General Electric, Remington Rand, Otis Elevator, Worthington, Firestone, Deere, Westinghouse, Air Brake, and American Machine and Foundry. In 1962, Raul Prebisch, a vigorous advocate of a Latin American common market and free trade, nonetheless wrote: “An argument I often hear, from Mexico to Buenos Aires, is that the Common Market will offer foreign industry opportunities for expansion that it does not now have in our limited markets. It is feared that the benefits offered by the Common Market will be taken advantage of principally by foreign industry and not by national industries. I shared and share this fear, not only in imagination but because I have verified the reality of that fact in practice.”
In fact, the Central American Common Market, another effort to join the deformed economies of five countries, has served to blow down with one puff the national producers of cloth, paint, medicines, cosmetics, and biscuits, and to expand the profits and trading orbit of many major U.S. corporations.
from EMPIRE OF COTTON, A GLOBAL HISTORY, Sven Beckert, 2014
In large parts of Africa, observed Thomas Ellison as late as 1886, “indigenous cotton has from time immemorial been both grown and manufactured, and the natives are for the most part clothed in fabrics of their own production.” Yet, while local and regional networks persisted, they would never again flourish. These smaller networks were undermined by the ever-widening veins of European capital and its commodities.
Tench Coxe [American political economist] understood that process already in 1818: the export of British piece goods to India, he perceptively observed, would force Indians “to turn to raising cotton instead of making piece goods they cannot sell [because of the flood of cheaper British goods—-goods, one might say, consciously deployed, not only for profit, but as weapons of destruction and coercion].
A growing number of rural cultivators turned into poorly paid wage workers in the world’s cotton fields. They were the least powerful. Becoming a wage worker was a measure of their defeat. In Egypt, by 1907, nearly 40 percent of all agriculturalists had become landless laborers. In India as well, the number of wage workers on cotton lands tended to increase across the nineteenth century. The greater orientation toward cotton agriculture resulted in an ever-increasing percentage of land devoted to the white gold. In northern Mexico, too, wage-labor swept the cotton fields. After1884, landowners in La Laguna made use of new railroads and a new irrigation infrastructure to build a huge cotton-growing complex, making it Mexico’s most important commercial agricultural area. Tens of thousands of workers populated the fields as the rural population, many of them migrants from elsewhere in Mexico, increased from twenty thousand to two hundred thousand between 1880 and 1910, with an additional forty thousand migrant workers arriving during harvest time. Many of these workers eventually arrived in La Laguna on private rail lines, packed like cattle in boxcars. Since there was no land available for these migrants, there was no possibility of engaging in subsistence agriculture.
Creating markets for metropolitan manufacturers was a conscious project of colonial administrations. The global South was to be a market for metropolitan industry, not a competitor, and a supplier of raw materials and labor, and both required the destruction of indigenous manufacturing. Despite individual resistance and collective protest, the overall trend was unwavering and ultimately devastating.
Next Post: The Consequences.