A Patriot's History of the Modern World

by Larry Schweikart

  Latin American banking rules favored exports, not long-term industrial loans, and immigrants in Latin America—especially Italians—put their money into banks and exports rather than local development. In exports, South and Central American firms found themselves intensely susceptible to tariff barriers. After passage of the Smoot-Hawley Tariff only Venezuela, with its oil, and Honduras (where, following major strikes, the fruit dealers led by President Vicente Mejía Colindres struck a deal by securing a loan from the U.S. fruit companies to ensure local wages were paid) avoided a collapse. Argentina’s debt—which previously had been mitigated by exports—rose sharply from 1929 to 1932, and even Mexico, which at first seemed impervious to the Great Depression, watched its economy collapse in 1938. With the nationalization of the oil companies, Mexico sealed its fate as a Third World country, seeing its exports fall 60 percent by World War II.172

  Along with the American government, various churches and social organizations marched south. The YMCA moved into Latin America with educational and sports programs, especially in Cuba, Peru, and Mexico, and boasted that it was “Americanizing the Mexican youth.”173 The Rockefeller Foundation joined in, spreading the “Social Gospel,” and virtually wiping out yellow fever in Veracruz and the Yucatán in the 1920s, upgrading local medical schools and clinics in the process. Author Jack London, visiting Veracruz, Mexico, in 1914, reported that Americans had purged the streets of “riff-raff” and “able bodied loafers.”174

  No doubt existed among American missionary groups or, in general, politicians that the “brown brothers” would gain from American involvement. Missionary societies contributed “to the diffusion of a new faith whose cultural matrix can be found in the American way of life (emphasis in original).”175 Improving Latin societies to a great degree meant Americanizing them—teaching them English, Protestant Christianity, American-style work regimens, respect for the law, and democratic processes. Unfortunately, this did not establish property rights or streamline the titling process, nor change the civil law legal structure. Over the next decade, an American invasion of the Caribbean, Mexico, and Latin America would sweep the hemisphere. Phelps-Dodge and Standard Oil in Mexico, International Petroleum Corporation (IPC) in Peru, and United Fruit in Honduras, Guatemala, and Nicaragua (which saw banana exports increase by 300 percent between 1914 and 1920) boosted local economies. Companies offered English training, self-help classes, and tried to impose traditional (legal) marriages to replace local common-law marriages. Alcohol was banned in company towns, sports and films were provided, and safety training was introduced to reduce accidents. United Fruit alone established a medical department to fight malaria and created clinics and hospitals at its plantations. American companies advertised freely in Latin America. One manager said, “I have seen the insides of huts completely covered with American magazine pages.”176 Coca-Cola launched sales drives in the Caribbean after World War I, then moved into Mexico and Guatemala; Ford opened an assembly plant in Argentina. All this was good, but none of it changed the basic institutions of Latin American countries to improve their ability to govern themselves.

  Neither American goodwill, missionaries, investment capital, nor soldiers seemed to stabilize Latin American countries. By 1931, almost every Latin American government had defaulted on its loans, and military dictators toppled civilian governments throughout the southern hemisphere, imposing heavy regulation and taxes on foreign investors. President Lázaro Cárdenas in Mexico nationalized American and British oil companies (1938). Peruvian workers went on strike at U.S.-owned mines, and Secretary of State Henry Stimson told the Peruvian government the United States would not help resolve the debts if they did not end the strikes. Bolivia nationalized Standard Oil properties in 1937. Eventually President Franklin Roosevelt negotiated a tiny return from Mexico for the nationalization of American companies’ investments in oil production, but they had already lost millions. If the peasants viewed the americanos as banditos, they only succeeded in replacing them with their own, far more ruthless, thieves.

  Selling the American Way

  Whether in Latin America or Europe, “Americanism” spread steadily, mostly through cultural elements such as music and movies but also through the YMCA and private business organizations such as Rotary International. It was no coincidence that Rotary International met for the first time in Europe in 1930, the same year Sinclair Lewis won the Nobel Prize, indicating that in business as well as literature, Americans had arrived. The American-born Rotary Clubs introduced to the Continent a “service ethic” that balanced an intimate fellowship of members with an outward worldwide movement. Critics saw Rotary in light of an “ever-equivocal relationship [of] capitalist exchange between the commercial impulse that could make society whole and the cut-throat competition that could tear it apart.”177 In Tocquevillian fashion, Rotary Clubs promoted a democracy of recognition,

  based on the effusive ritual that both fascinated and appalled upper-class Europeans, combined of hearty handshakes, jocular talk, first-name intimacy, and loud chorus singing. Individualistic, yet tamed by small courtesies, this sociability encouraged a mutable new social self, conformist yet enterprising, withholding judgments or expressing them in circumlocutory conventions, yet confident enough to recognize and be recognized by others in distant worlds.178

  Rotary constituted just one of the many influences of American culture and business (some would term it cultural imperialism), and at the time few thought anything about the notion of spreading American products, cinema, music, or business practices abroad. If anything, the entrepreneurs of the day thought it would introduce the Europeans to new horizons. From 1929 to 1932, for example, auto industrialist Henry Ford and the International Labor Organization undertook a European-based multicountry study on the standard of living and wage levels that introduced to the Continent the concept of the “American standard of living.” Despite a new commercial and industrial culture, the study revealed that European consumption of autos, household appliances, dining sets, and so on had failed to produce a rising standard of living as had occurred in the United States. On a number of fronts, the Europeans lagged behind Americans: in business practices, for example, National Cash Register had introduced its mechanical cash registers to Europe in the 1880s, yet as late as the 1920s, Germany, the most mechanized country in Europe, had cash registers in only half its stores, and only one fourth kept regular accounts.179

  Somewhat more successful in penetrating European practices were the “five and dime” stores, such as F. W. Woolworth. Called prix unique in France and Einheitpreisgeschaft in Germany, Woolworth was joined by Thomas Lipton in Britain, Dock Remois and Felix Potin in France, Delhaize Le Lion in Belgium, and Latscha in Germany. Woolworth opened its first German store in 1927, and by 1932 had eighty-two locations in that country, including fourteen in Berlin. By the 1930s, more than twelve thousand chain stores had opened across Europe, many of them outside traditional city centers.

  The chain stores sold more than consumer products; they sold Americanism, the product of the four pillars of American exceptionalism but not the four pillars themselves. American names became the generic identifiers for all similar products: sewing machines were Singers, vacuum cleaners were Hoovers, razors were Gillettes, cameras were Kodaks. Cigarettes, especially, were advertised in ways that made all cigarettes into “Lucky Strikes” or “Chesterfields,” and European tobacco companies strove to achieve “an American cigarette.”

  A Veblenesque approach to conspicuous consumption fails to take into account a cultural context—that without a grounding in Western civilization, history, and culture, the acquisition of “stuff” becomes irrelevant. How does one enjoy opera without an understanding of the Italian language and culture or the story being told? How does one enjoy visits to ancient ruins without an appreciation of the history represented there? The Europeans in the 1920s found this out. As cultural historian Victoria de Grazia pointed out, “Newcomers similarly wanted access to libraries, hotel
s, spas, and the seaside, not to mention the first-class compartments of trains, the box seats at the opera, and the motor roads transited by the wealthy in their touring cars. But once the newcomers had access to them, these goods and services could not yield the same satisfaction.”180

  Hence, although Europeans gradually “Americanized” many aspects of their lives, particularly the way they shopped, the entertainments they pursued, and the corporate/business organizations they imposed, the process did not seep down into the European soul, or affect the deep class divisions present (which the United States had largely avoided). Or, to put it another way, Americans changed European consumption habits without imbuing them with the cultural underpinnings necessary to make society work in a representative democracy. Moreover, the American tradition of widespread property ownership and broad freedoms had led U.S. businesses to increasingly treat consumers as quasi-partners in the production process. Consumer choices—and increasingly direct marketing responses from consumers in the form of surveys—shaped the American products themselves.

  Such widespread consumer interaction simply did not exist elsewhere, particularly where governments were dictatorial and production and societies were controlled by elites. For American companies, educated consumers were active partners in the production process, experimenting with new products and purchasing arrangements, unshackled by medieval patterns of trade and shopping. With the introduction of chain stores in Europe, for example, lower prices came unevenly, forcing average European consumers to practice purchasing skills, introducing an “American” value system dominated by cost as contrasted with a traditional village system in which the buyer acted on a familiarity with, and trust in, the merchant. This freed consumers from relying on shopkeepers as arbiters of value and social taste, empowering them to discriminate. Newly empowered consumers too often chose on the basis of cost alone, complained the critics, becoming the forerunners to the Walmart shoppers of the late twentieth century. Their lack of taste horrified elites then just as much as it does in the twenty-first century.

  Another reason elites were threatened by this new consumer power was that they were no longer in control of the market for goods. Designers ultimately could inspire and suggest, but consumers remained the final arbiters, and by the late twentieth century, astute capitalists had virtually enlisted consumers into their development and engineering teams through hypersensitive attention paid to sales feedback.

  Determining what consumers wanted in the 1920s was an art that was coming of age in the form of the advertising industry. Large advertising firms, such as New York’s J. Walter Thompson, which pioneered the first ads aimed exclusively at women, originated modern magazine advertising in the late 1800s that by the 1920s had spread into the Saturday Evening Post, Good Housekeeping, Ladies’ Home Journal, and Life. By the 1920s, the company was a powerhouse, unveiling the first celebrity endorsement ads for Lux soap and then, thanks to the dynamic husband-wife team of Stanley and Helen Resor, drafting the first “sex appeal” ads.181 The firm had become the world’s largest advertiser in 1916, whereupon Thompson was sold to a group that included the Resors. Helen Resor’s ads for Woodbury Facial Soap remain classic advertising well into the twenty-first century, featuring a man in a tuxedo and a woman in an evening gown embracing, highlighted with the slogan “A Skin You Love to Touch.” Stanley, meanwhile, engineered the first “blind” taste tests of products. Only a few powerful firms, such as Batton, Barton, Durstein, and Osborn (BBD&O) or Lord & Thomas in Chicago, offered first-class competition to J. Walter Thompson. With its chief ad man, Albert Lasker, Lord & Thomas hired unusual characters, such as the tunnel-visioned super-salesman of cigarettes, George Washington Hill, himself a relentless chain smoker placed in charge of the Lucky Strike account. Lasker once soberly commented about Hill, “I would not call him a rounded man. The only purpose in life to him was to wake up, to eat, and sleep so that he’d have strength to sell more Lucky Strikes.”182 Hill and Lasker recruited actress Helen Hayes to direct ads at females, coming up with the catchy phrase “Reach for a Lucky instead of a sweet.” This precipitated a mini-war with the candy industry, and exposed large numbers of women to tobacco for the first time.

  Of all the American advertising giants, perhaps the most famous was Bruce Barton of the powerhouse BBD&O firm. A devout Christian, Barton had used his writing talents in World War I for the Salvation Army, the YMCA, and the United War Work Campaign. Believing that each new generation would forget the experientially based knowledge of the old, he reasoned that products had to constantly be reinvented and repackaged. Even as he observed, “We are creating, creating, creating all the time,” Barton reserved time for a book project, which he completed in 1925 under the title The Man Nobody Knows.183 In it, he presented Jesus Christ as a CEO, possessing exceptional management skills and recruiting abilities. The Lord was, according to Barton, the top advertising man in history! The book went on to sell a quarter of a million copies in one year, and Barton continued to champion a certain morality in advertising throughout his career. He profoundly disagreed with the emerging trend in advertising to use sex appeal or subliminal messages and deeply respected the consumer’s sense of value and dignity. In the medieval understanding of caveat emptor, Barton thought that properly informed buyers would make proper choices.

  By the 1920s, the Europeans had only started to appreciate the power of American-style advertising, with its lavish decoration, densely packed informative text, and photography. Until then, most European ads were blunt instruments, designed “to deliver as hard as possible a blow between the eyes through the medium of printer’s ink.”184 Roger-Louis Dupuy, a French advertiser who sought to maintain European taste and resist the American onslaught, rejected the idea that advertising had to tell a story or exaggerate any benefits. “No need to construct a scenario,” he said. The “object, the object alone, the object-king, just solicit it, [and] it will tell its own story.”185 Advertisers developed “a colloquial language,” said Canadian sociologist William Leiss, which, “though it mimicked the popular, was by virtue of what it included and left out distinctly of corporate and commercial origin.”186

  Yet tension arose when advertisers tried to figure out what they were actually selling: a product, or a lifestyle. Elites, for example, “believe[d] in representation…more than the things represented,” said French sociologist Pierre Bourdieu.187 The calm reassurance of traditional images and moral maxims characterized most ads. Typically, European advertisers distinguished their work according to sex, seeking to “Seduce the Ladies,” “Instruct the Gents.”188 For this, the European agencies relied heavily on American input from J. Walter Thompson, with American themes therefore showing up in increasingly strong doses. A dilemma soon emerged: to sell “Americanism,” Madison Avenue had to emphasize American exceptionalism, which was precisely what made “Americanism” appealing in the first place. Yet how could advertisers do that without subtly reminding Europeans that they were not Americans—even if they bought American goods and enjoyed American entertainment? At some point, the process demanded that Europeans be reminded of their flaws or inadequacies. It proved a thin and eventually impossible tightrope to walk. Europeans preferred to have America remade in Europe’s image, whatever its flaws, and surprisingly, they were able to find many American Progressives who perpetually saw things European as superior and therefore helped them.

  Like advertising, American film also penetrated European culture and would continue to do so, accounting for between 80 and 90 percent of Europe’s film receipts by 2000, when American film exports to Europe in dollar value exceeded European exports to America by 1500 to 1.189 Using direct-sales offices and employing “block booking,” which required the retailers to take all the releases of the distributor, not just the titles that were best suited to their markets, U.S. motion picture companies created an American movie culture in Europe. This often entailed sales campaigns directed against local censorship boards, religious groups, and local gove
rnments. Hollywood, through the Motion Picture Producers and Distributors of America, pressured studios to conform to its censorship guidelines and production codes and make films that spoke to universal themes of family, God, patriotism, and fair play, while avoiding sexual situations or other (then taboo) vices.190 Thus Hollywood at the same time minimized its own dominance abroad while dictating taste. At the same time, American movies sold conformity, “puritanical moralism,” and traditional values, while concurrently attacking them through the popular slapstick humor of Buster Keaton and Charlie Chaplin. One European culture critic marveled, “You have to hand it to the Americans…. [T]hey subject the world to an often unbearable discipline [then introduce rebellion which] dismantles this self-imposed order.”191

  Briefly, European cinema believed it could compete with Hollywood. In 1926 Vladimir Wengeroff of Westi Films insisted “if cinema is 20% art and 80% industry, we—Europe—have that 20%. That’s our strength and that’s how we will win. The Americans do not understand that.”192 In reality, Europe couldn’t begin to compete, if for no other reason than the comparatively small size of its market. The United States had 18,000 movie houses by 1930, compared with 2,400 in France and 3,000 in Britain, and the Americans were uniquely prepared for the conversion to sound. Above all, American cinema “won” because it presented what foreigners wanted to see: American prosperity and culture, or, in a word, American exceptionalism—even if they didn’t understand where it came from. America’s films trumpeted an American attitude differing from that of the Europeans’. As merger manager and economist Paul Mazur recorded in his book American Prosperity (1928), “Europe tightened its belt to the last notch, whereas the United States let its out to the first. The goal should be to feed the man to fill out the belt, not to yank it tight to fit a shrinking waistline.”193