by John Lynch
The project had never been conceived as agrarian reform. But even as a means of paying wages it failed. According to Pedro Briceño Méndez, secretary of Bolívar and minister of war: ‘None of those who have received their payments in the form of certificates actually possess them; all of these, or the greater part of them, have passed into other hands, the hands of profiteers who have paid the infamous price I have mentioned [5 per cent of true value].’44 A new elite of landowners, rewarded from sequestered property or public land, joined the colonial proprietors and in some cases replaced them. But the soldiers who had not received their due complained bitterly about the operations of the land commissions. From east to west there were accusations of favouritism, inertia, inefficiency and class prejudice in the distribution of land. Mothers, sons and widows presented claims and complaints against the land and property committees: ‘More than a third of the houses and estates of Venezuela have been confiscated, but not to help those who most deserve it and who have the greatest right to compensation.’45 The troops and their dependants received nothing; the caudillos everything. Far from changing the agrarian structure, independence produced yet greater land concentration. Bolívar’s hopes for his citizen soldiers vanished into the valleys and plains of Colombia.
Bolívar was acutely conscious of the polarization of society and of the great tensions engendered by social and political discrimination. It was because of this that he feared the resentment and the claims of the masses, the increase of pardoerada and the danger of new social convulsions. His own policy was not revolutionary. The abolition of slavery and the distribution of land were reformist measures which would have modified but not transformed existing structures. In practice he was not able to proceed beyond the elite along the road of reform for fear of a reaction, in which independence itself might have been threatened. Aristocrat by birth and breeding, he differed from his class in his awareness of the limitations of the republican revolution. In 1828 he described with unique insight the state of slavery in which the Colombian lower class still lived, subject to local mayors and magnates, and denied the human rights to which they were entitled:
In Colombia there is an aristocracy of rank, office and wealth, equivalent by its influence, pretensions and pressure on the people, to the most despotic aristocracy of titles and birth in Europe. Included in the ranks of this aristocracy are the clergy, the religious, the educated, the lawyers, the military and the rich. For although they speak of liberty and constitutions, they want these only for themselves, not for the people, whom they wish to see continue under their oppression. They also want equality, but by this they mean equality with the upper classes, not the lower. In spite of all their liberalism, they prefer to regard the lower classes as their perpetual serfs.46
The polarization of society between an oligarchy of landed proprietors and their lesser allies on the one hand and the rural masses on the other was the future prospect of Colombia, and in his most pessimistic moods Bolívar doubted the ability of constitutions to make any difference. The rural masses and their masters were not, of course, the whole of Colombia, whose population of over one million also included urban artisans, miners and groups in the middle of society. And the rural population itself comprised tenant farmers as well as labourers, stockmen as well as peons, Indians as well as mestizos. Independence perhaps accentuated these distinctions in offering new opportunities for differentiation within existing society. But it did not offer basic mobility or decrease the divisions which Bolívar described. He remained convinced that if the new ruling classes did not accept reforms they would be threatened by a mass movement from below. The escape route was to reduce poverty through economic growth, an elusive goal for one man.
The Bolivarian Economy
The vital spark of Bolívar’s glory could not fire the economy. Independence was a prize that had to be paid for. In 1825–6 military expenses were still absorbing three quarters of the state’s revenue. The conflict was damaging and left many haciendas in ruins, targets for confiscation and plunder during the war and for personal vendettas afterwards.47 Production suffered and cattle diminished as rival armies dragged off peons and raided herds; in the post–war years hacendados, survivors from colonial families or newcomers profiting from land grants, still suffered from rural insecurity and a legacy of crimes, vagrancy, banditry and slave rebellion. Loss of slaves meant loss of invested capital at a time when the owner was probably struggling to pay the interest on his mortgage and facing foreclosure. The demographic effects of war, the human costs of liberation, impressed many observers as catastrophic: people perished in fighting and atrocities, or fled, hid, or migrated, causing population shifts which the government could not track, probably less serious in New Granada, where demographic growth continued towards the 1.1 million calculated for 1825, than in Venezuela, which was said to have lost a third of its population in the conflict.48 Conscription uprooted the work force from fields and mines and caused a flight of peons, Indians and slaves whenever recruiting gangs drew near. News of the approach of Bolívar was as likely to cause people to disappear as to join the cheering.
The British consul at La Guaira concluded: ‘The expulsion of the European Spaniards in 1823, the previous emigration from this country [Venezuela], added to the excesses committed by the contending parties, and consequent decrease of population, has, in many instances, left extensive and valuable estates abandoned, and others only partially cultivated.’49 By 1821 many plantations had been invaded not only by warring parties but by tropical vegetation. To renew cultivation more labour and capital were needed than were available in these years, at a time, moreover, when international prices for tropical products, especially for coffee, were steeply declining. Local agriculture, on the other hand, was still productive. The plains of Bogotá were well cultivated: farmers obtained two harvests a year and, with a good system of irrigation, excellent crops of wheat, barley and lucerne were produced. But ploughs, harrows and other agricultural implements were primitive, and there was still a great dependence on imported hardware.50
The war in Peru left the country prostrate; farms and plantations the victims of military destruction and diversion of labour.51 The traditional prop of the economy and Peru’s major exportable assets, gold and silver, were also depressed; mining production was hit by disruption of communications and by severe shortage of labour, mercury, mules and capital. Between 1819 and 1825 an estimated 26.9 million dollars were shipped from Lima in British ships, representing payments for imports – consumer goods and war materials – and flight of capital to safer outlets.52 Inevitably Peru could not earn enough to pay for imports of manufactured goods, at a time when excited British businessmen swarmed in to provide goods and services. Captain Basil Hall R.N. noticed the impact of recent changes when he dined in a Peruvian home in Huacho: ‘A roll of English broad–cloth was resting on a French wine case, marked Medoc; on the table stood a bottle of champagne; the knives and forks were marked Sheffield, and the screen which divided the apartment was made of a piece of Glasgow printed cotton.’53 The trade gap was temporarily bridged by foreign borrowing, itself a lesson in profligacy.
Bolívar’s economic thought favoured development within a new liberal framework, but his policy was frustrated by post–war conditions and by powerful interest groups. A stagnant agriculture and inadequate revenue were his major difficulties. The prime source of economic liberalism was Adam Smith, who argued that existing restrictions resulted in the wrong distribution of resources, that is, away from agriculture. He therefore advocated free trade and a general programme of economic liberalism to remove restraints on land and labour. A more immediate impetus to Bolívar’s economic ideas was given by his own observation of the colonial economy and his opposition to the Spanish monopoly: ‘Do you wish to know what our future was? We were mere consumers, confined to the cultivation of indigo, grain, coffee, sugar, cacao and cotton; raising cattle on the empty plains; hunting wild game in the wilderness; mining in the earth to
produce gold for the insatiable greed of Spain.’54
Experience and enlightenment coincided to produce in Bolívar a belief in agricultural development, free trade and the benefits of foreign investment. He was satisfied with a primary export role for Spanish America and was not unduly concerned for the survival of artisan industries or the achievement of economic self–sufficiency. But he was not a slave to economic liberalism and was never doctrinaire. He envisaged a larger and more positive role for the state than classical liberalism allowed, and to this extent he showed his awareness of the particular problems of underdevelopment. In the case of Colombia these were aggravated by a decade of destruction and feeble administration; he decreed the death penalty for officials found guilty of peculation, but in a port like Cartagena, where evasion of customs duties was reduced to a fine art by experienced importers and underpaid officials, this was not likely to impress.55
More positively, Bolívar expected state action to improve the infrastructure, especially in improving communications between regions. He had travelled many thousands of miles through valleys, plains and páramos in these countries without roads and had shared the heroic marches of his armies before battle had even begun. There were no carriage highways in Colombia, only bridle roads. Transport was primitive: land conveyance was confined to mules, water transport to canoes and barges; in the whole country there were no carriages and Bogotá had only two gigs.56 The Magdalena River, the major route from north to south, was held in the grip of its notorious boatmen, the bogas, whom foreigners found drunken and quarrelsome and Colombians regarded as a law unto themselves.57 There were other hazards: the fifteen–year–old son of the British consul was carried off by an alligator while swimming in the Magdalena and his distraught mother suffered a miscarriage.58 River travel from Barranquilla to Mompós could take fifteen days and over thirty from Mompós to Honda, the port of debarkation for the capital. A monopoly contract was conceded to John Bernard Elbers, a Colombian of German birth, to establish steamboats on the river, but failure to provide feeder roads and fuel stations and the technical deficiencies of the boats themselves combined to reduce operations, and in 1829 the contract was cancelled. In Guayaquil Bolívar committed the revenue of the salt monopoly for road building, and he decreed protection and tax breaks for the construction of a road from the port of Esmeraldas to the interior in which the government would invest.59 But independence made little difference to the infrastructure and to conditions of life and work, and Bolívar learned that he had to leave Colombians to improve their own lives without the use of modern technology and little help from the state.
War and revolution added further burdens to an already feeble economy. Drift of labour, loss of animals, flight of capital, all reduced Venezuela and New Granada to new levels of depression and added to the problems of planners. From first steps with the congress of Cúcuta, republican legislation guaranteed freedom of agriculture, industry and commerce to operate without monopoly and corporative restrictions, and the government confined itself to providing the conditions within which private enterprise could operate. This was the theory. In practice, laissez–faire had to be modified and the Bolivarian economy accepted a model of moderate protectionism. Agriculture needed protection and encouragement, first to secure import substitution, then to produce a surplus for export. Exports of cacao, cotton, tobacco and hides from Cartagena and Santa Marta were basically stagnant and had to be supplemented by gold and silver to earn returns for imports. Venezuelan exports of cacao, coffee, cotton, indigo and hides were supplemented by more lucrative export of horses, mules and cattle, for which there was a market in the British Caribbean.60
Bolívar urged congress to prohibit the export of livestock in order to build up the national herds. He decreed the prohibition of the export of horses and mules.61 And while he was in Cuzco he forbade the slaughter of vicuñas and authorized state subsidies for those who gathered them into herds.62 Bolívar also wanted to free agriculture from the heavy duties imposed by the colonial regime, and he decreed the removal of tithes and export taxes. The congress of Cúcuta abolished internal customs barriers, the alcabala and entails. But the fiscal system tended to revert to its colonial state as more taxes were restored to finance the war effort and the post–war administration. The alcabala was revived in 1826, and its reduction from 5 to 4 per cent in 1828 was regarded as a concession designed to make Venezuelan exports more competitive.63 The alcohol estanco, abolished in 1826, was re–established in 1828, and the colonial tobacco monopoly continued as a major revenue until its abolition in 1850. It was clear to Bolívar that the surplus from agriculture, above all in the export sector, was not being reinvested in production. The tobacco revenue in particular was used as an all–purpose fund to meet an endless series of expenses. Bolívar was concerned that none of the profits of tobacco was being ploughed back into production. As his finance minister Rafael Revenga observed: ‘Far from thriving, the revenue will suffer if, instead of the income being used to promote production, as the Liberator has so often and urgently ordered, it is diverted to expenditure elsewhere.’64
In the absence of domestic accumulation, Bolívar looked abroad, and he made it known that foreign capital, entrepreneurs and immigrants were welcome in the new republics. Few of these, however, were attracted to agriculture, and capital tended to concentrate in abortive mining projects. Bolívar had liberal ideas on immigration, and there were many colonization and land company projects in New Granada and Venezuela, but these foundered on the greed of entrepreneurs, who sought quick profits, and the reluctance of European immigrants to come as labourers. Immigration policy contained glaring contradictions, not all of Bolívar’s making. There was already a mass of landless peasants and llaneros in Colombia, but the state failed to implement adequately Bolívar’s cherished scheme of land distribution. The landowning class, on the other hand, or some of it, received the further advantage of agricultural loans from the government.
Independence ended the Spanish colonial monopoly, but foreign trade continued to be subject to restrictions, and there was nothing approaching true free trade. Colombia was not ready to fill a significant role in the world economy, though it was still an exporter of gold. There was a flurry of British trade and investment in Colombia in the 1820s, and British loans to the government in 1820,1822 and 1824 provided welcome foreign exchange and stimulated trade with Britain. But the boom ended in 1826 when Colombia defaulted and reverted to colonial trade trends, depending on meagre gold exports for foreign imports. In these conditions there was no basis for national development and Colombia divided into a number of regional economies, each more or less self–sufficient and providing a basic, if primitive, living for its inhabitants.65 A similar tale could be told for Peru. A loan of £1.2 million was contracted in London in 1822, from which the Peruvian government would receive less than £900,000.66 A further loan for £616,000 was contracted in 1825, but the government fell into arrears in the same year and suspended interest payments. These loans were simply used for meeting previous obligations to British merchants and for financing military and naval expenditure, and there was no surplus for investment in development.
The state’s revenue depended on the income from trade. The congress of Cúcuta sought to establish an income tax, but lack of reliable statistics on taxpayers and the failings of revenue officials crippled this experiment from the start, and it was dropped in 1826.67 So foreign trade had to take the strain. The tariff of 1826 imposed duties ranging from 7½ per cent to 36 per cent on most imports; this was primarily a revenue tariff but it also had a protective content to satisfy national economic interests, and state monopolies were protected by prohibition of the import of foreign tobacco and salt. By 1830 import duties were higher than at the end of the colonial regime. There were also some export duties for revenue purposes, though the country’s export trade was hardly flourishing enough to sustain them. Colombia’s production pattern remained the same: the principal items were coffee, cacao, t
obacco, dyewoods and hides, with sugar and cotton on a smaller scale. The agriculturalists of northern New Granada, like those of coastal Venezuela, demanded and received protection for their plantation products. But the weaker wheat producers of the interior were not so protected against United States flour. And all agricultural production suffered from lack of investment capital, shortage of labour, poor communications and low prices on the international market. In the province of Neiva, through which Bolívar travelled on his way south in 1822, vast tracts of excellent land lay uncultivated for want of labour.68 Bolívar soon realized that the economic problems of independence were more intractable than the military.