Continuing our look at Latin American history, I want to touch on a period that didn’t directly involve the United States, except through companies like United Fruit Company. The half-century from 1880 until 1930 was what was known as the neocolonial period in Latin America. As the industrial revolution transformed Europe and the United States, the new Latin American countries chose not to industrialize. At least, those governing made such choices. There was far more money to be made by selling goods to the industrialized countries: coffee, sugar, rubber, wheat, beef, minerals, and, of course, bananas.
Who benefitted from this practice? Large landowners and urban merchants. The average person gained nothing from this “progress.” As we saw in the article “Why Can’t People Feed Themselves,” colonialism destroyed the means by which native populations could sustain themselves. Neocolonialism followed the same path. Railroads displaced small farmers, who found themselves forced to work for the large landowners. Governments supported and subsidized the growing of “cash crops,” rather than the production of food for the people. Large corporations kept wages low and working conditions inhumane. The rich grew richer and the poor grew poorer.
As large landowners made their money via exports, they spent that money in the cities. Latin America’s population began to move to the cities; there just wasn’t a way to make a living in rural areas. The only way to survive was to work on one of the large plantations, but that was subsistence level at best.
For those in power, the neocolonial period was a wonderful time. For the bulk of the population, it meant a new form of servitude. Instead of serving foreign powers, they were now under the rich and powerful from their own country.