Present at the Disruption
How Trump Unmade U.S. Foreign Policy
When President Kennedy proposed a hemispheric Alliance for Progress to spur economic development and raise living standards in Latin America, he endorsed agrarian reform as a basic part of this effort. Land reform is not altogether new, of course, in Latin America. Simon Bolivar undertook, though with only limited success, to distribute estates seized from Spanish loyalists to the veterans of his revolutionary armies. In Haiti, when the republic was founded, the rebellious slaves killed most of their former masters who did not escape into exile, and the land was distributed among the Negroes. In the Dominican Republic, the Spanish colonial landowners fled before the Haitian armies which invaded the area in 1821, and from that time until the advent of the régime of the late Rafael Trujillo, most of the land remained in the hands of small peasant proprietors. Finally, from time to time during the nineteenth century there were sporadic efforts at land reform; in many Latin American nations, for instance, the church was deprived of its land, which was distributed in one way or another among the laity.
In recent decades agrarian reform has once again assumed hemispheric proportions. Mexico engaged in a massive redistribution of land in the years following the outbreak of its Revolution in 1910. The fundamental achievement of the Bolivian Revolution, which began a decade ago, has also been land reform. In Guatemala between 1952-1954 there was an attempt at a thoroughgoing redistribution of the land by the government of President Jacobo Arbenz, but this was thwarted when his régime was overthrown in the middle of 1954. In the last three and a half years Venezuela has undertaken a large-scale land redistribution scheme, and in a very different manner the same process has been carried out in Castro's Cuba. Within the last year, legislation calling for one type or another of agrarian reform has been passed in Colombia, Chile, the Dominican Republic and Brazil. Similar programs are pending in Peru and possibly in Ecuador.
The large estates which for four to five centuries have monopolized so much of Latin American agriculture were created by the Iberian conquerors, who either enslaved the Indians to work the land for them or brought in Africans to take their place. Today, the remnants of these great landed estates (latifundia) hamper the whole continent's economic, social and political development. As they are cultivated by peasants who receive little or no money income, they severely limit the market for manufactured goods and thus slow down industrialization and other forms of economic development. In defiance of the spirit of the age, they keep a large part of the population in a state of semi-serfdom or semi-slavery. So long as the vast social chasms which they create continue to exist, democracy will be exceedingly difficult to realize.
Even relatively advanced nations are faced with the need for agrarian reform. In Brazil, large landholdings and antiquated methods of production keep an estimated 40 million of the country's 70 million people out of the market, with incomes so small that they buy virtually nothing. For the nearly 25 million peasants of northeastern Brazil, the situation is particularly acute. There the remnants of the slave system are especially marked, and the poverty is aggravated by recurring droughts which reduce even further the miserably low standard of living.
In Chile, sizable areas of the fertile Central Valley are kept out of production by the large landholders, who have little incentive to invest their already appreciable incomes in putting more acreage under the plough. The landholding pattern thus not only restricts the market for the country's urban industries, but also contributes to chronic inflation by restricting agricultural output.
In both Brazil and Chile the social and political pressures arising from discontent with the large landholding pattern are reaching the explosive point. Recently, unions of peasants and agricultural laborers have been developing rapidly under extremist leadership. In Brazil, leaders of the rural workers' movement are openly sympathetic to the methods used by Fidel Castro; in Chile the agricultural laborer may provide the margin of victory for a pro-Communist presidential candidate in the 1964 elections.
Argentina is one of the few Latin American countries in which land redistribution has never been a major issue. Although the greater part of the most fertile land is owned by large landholders, the agricultural system does not follow the semi-feudal pattern of other Latin American countries. For three-quarters of a century, Argentina has used modern methods and machinery for large-scale production of grains and meat for export. Elsewhere, however, Latin America is now being shaken by a groundswell of revolt against the traditional landholding pattern.
The oldest of the contemporary agrarian reform programs in Latin America is that of Mexico, where it has been in process for about half a century. With the outbreak of the Mexican Revolution in 1910, Emiliano Zapata, whose peasant armies controlled several states in the southern part of the country, carried out a de facto redistribution of the land in areas under his control, allowing the peasants to take the land from the large proprietors. Commencing in January 1915, the government of President Venustiano Carranza began the legal process of agrarian reform with a law providing for the restitution of land which had been seized from indigenous landholding communities during the régime of Porfirio Diaz (1876-1910). In subsequent years, this original law was greatly amplified to permit government expropriation of individual holdings in excess of minimums which varied with the nature of the land involved.
All governments since the Carranza régime have continued the process of agrarian reform. A high point was reached during the 1920s when nearly 4,500,000 hectares (a hectare is approximately 2.5 acres) were distributed over an eight-year period to some 2,200 villages containing nearly 450,000 families. An even larger effort was made during the administration of President Lázaro Cárdenas (1934-40), which distributed approximately 15,000,000 hectares of land. During the succeeding three administrations, the rhythm of land redistribution slowed down considerably, but today the government of President Adolfo Lopez Mateos has once again increased the pace. By early 1962 the total amount of land distributed since the first decree of January 1915 had reached approximately 50,000,000 hectares. Some 12,000,000 peasants are estimated to have benefited, with the result that the land under cultivation is now approximately equally divided between the beneficiaries of the land redistribution program and other proprietors, most of whom lost land through the reform.
Agrarian reform in Mexico developed in a pragmatic manner, as did the whole Mexican Revolution. It was not until 1922 that the agrarian authorities decided upon the pattern which they wished to follow in establishing the new small proprietorships. Not until 1924 did they begin to face the problem of the new landholders' need for credit. It was some years later still before any major effort was made to develop an effective agricultural extension service to help the peasants make better use of their land. However, as the first and most extensive effort of its kind, the Mexican experience has been widely studied by those planning similar moves in other Latin American countries.
One program which has been very much influenced by the Mexican example has been that of Bolivia, following the Revolution of April 9, 1952, which put the Movimiento Nacionalista Revolucionaria in power. Mexican officials helped in drawing up the basic law, and others assisted in putting the law into operation. Like Mexico, Bolivia has attempted to restructure the whole rural economy of the country and to integrate the peasant masses into the civil life of the nation. All tenants were granted the land on which, under the traditional Bolivian latifundia system, they had been allowed to build their homes and to grow crops for their own use. As a result, every Indian tenant was immediately converted into a small proprietor. In addition, however, the Bolivian law promised that as rapidly as possible the land which the Indians had cultivated in behalf of their landlord would be divided among them. Almost a decade after this process began, it is estimated that about one-third of the land subject to redistribution has actually been given to the peasants. The main impediment to more rapid progress has been a lack of personnel to do the job of surveying and dividing the large estates.
The Guatemalan agrarian reform of 1952-54 was also much influenced by the Mexican example, at least in theory. As in Mexico, the Guatemalan law granted the peasants use-rights to the land rather than full title. It also left sizable amounts of land to the old proprietors, although it differed from the Mexican practice in taking only uncultivated land from private landowners. The actual process differed very much, however, from what was provided in the law. The Communist Party, which was a major force in the councils of the Arbenz régime, sought to use the agrarian reform as a lever with which to lift itself to power. It encouraged illegal seizures of land by the peasants, without waiting for the process of expropriation by the National Agrarian Department, with the result that much land was occupied which according to law should not have been subject to the reform. Finally, the whole process was reversed when President Arbenz was overthrown in the middle of 1954, and President Carlos Castillo Armas restored to the old proprietors the land which had been taken from them by his predecessor. Since that time, successive governments have substituted a process of opening up and colonizing government-held land in the northwestern part of the country, instead of dividing existing private holdings.
As in Guatemala, the agrarian reform in Cuba has been quite different in application from what was stipulated in Castro's law. The decree of May 1959 was relatively modest, providing that no corporation could own land, and that no private landowner could have more than 990 acres in most cases, or 3,300 acres in exceptional instances. Each tenant or agricultural laborer was to receive some 66 acres free and the opportunity to purchase an additional 99 acres at a low price. Although there was passing mention of establishing agricultural coöperatives, the whole emphasis of the law was on the redistribution of land to small proprietors.
In fact, the Castro government has operated in almost complete disregard of its own agrarian reform law. Compensation has not been paid. The land, instead of being given in fee simple to the ex-tenants and agricultural laborers, has passed into the hands of the all-powerful Institute National de Reforma Agraria (I.N.R.A.), which has organized it into collectives and state farms on the Soviet model. It is estimated that by the middle of 1962, about 80 percent of all cultivated land in Cuba was in the hands of the government, and the other 20 percent in the hands of small proprietors, who, however, were forced to belong to the government-dominated Asociación National de Agricultores Pequeños and to sell their produce to the I.N.R.A., which was granted a monopoly in the purchase of all agricultural and grazing products. The small peasant landholder was not even allowed to slaughter any of his own cattle or chickens without its permission. In August of this year, Castro indicated that the remaining coöperatives would be converted to state farms.
The fifth major agrarian reform program undertaken in Latin America in recent years has been in Venezuela. A preliminary attempt was made between 1945 and 1948, but it proved abortive when the government of President Rómulo Gallegos was overthrown by a military coup d'état in November of the latter year, and most of the land redistribution which had been carried out in those years was undone. With the overthrow of the military régime in January 1958, the process of agrarian reform was undertaken once again; at first it applied only to land which had been seized from members of the fallen régime, but since 1960 it has operated on the basis of a basic agrarian reform law.
The Venezuelan law was probably the most carefully prepared piece of legislation of this type which has so far been seen in Latin America. It was drafted by a large commission which included representatives of the peasants' federation, the landholders' organization, the Confederation of Workers of Venezuela, the four major political parties of the time, the banking, commercial and industrial communities, the government, and organizations of agronomists, economists and other technicians with knowledge of the matter at hand. The resulting law represented a consensus of all of these groups. It provides for expropriation of large estates as well as the distribution of government-owned land, and undertakes to grant the land principally to small proprietors, although in some exceptional cases there is provision for establishing cooperatives, when large-scale production is technically desirable, as in the case of stock farms and sugar plantations. Since the government of Rómulo Betancourt was inaugurated in February 1959, it has pushed land distribution at an accelerating pace. The total land distributed by the end of February 1962 was 1,416,475 hectares to 45,348 peasant families, and in March President Betancourt announced that he intended to convey land to 100,000 additional heads of families before his term ends early in 1964.
The intensiveness with which reform has been carried out varies a great deal from one part of Venezuela to another. In the central states of Carabobo and Aragua, where the pressure of the rural population on the land was most intense, virtually all of the large estates have been expropriated and turned over to the peasants. On the other hand, in the state of Zulia, around Lake Maracaibo in the west, the process of land distribution really began only in the last months of 1961, while in some of the eastern states application of the law at present is only nominal.
In Brazil, Chile, Colombia and the Dominican Republic, agrarian reform is just beginning. Laws providing for land redistribution were passed in several Brazilian states in late 1961 and early 1962, and a national law has been pending before Congress for more than a year. In Chile and Colombia legislation was passed early in 1962, but the machinery for putting the law into effect is still being organized. In the Dominican Republic, agrarian reform has become the order of the day since the death of Rafael Trujillo. During the 31 years of his dictatorship, he had virtually converted the Dominican Republic into a large hacienda of the Trujillo family, through forcible seizure of land from the small peasants and large landholders alike; some estimates of the family's holdings ran to as high as 60 percent of all arable land in the republic. Since the revolution of November 1961, these lands have passed into the hands of the government, and a handful have been distributed among the peasants living on them. But although an Agrarian Reform Institute has been established, no basic law has as yet been enacted and none is likely to be until a constitutional régime is established sometime early in 1963.
In Peru and Ecuador the need for agrarian reform is now widely discussed. While Pedro Beltrán was prime minister of Peru between 1958 and 1961, he proposed a program which he labelled "agrarian reform," but which in fact was designed to move Indians from the heavily populated valleys of the Andes to unoccupied government land on the eastern slopes of the mountains. In the recent presidential election campaign, virtually all of the candidates talked about the need for agrarian reform, but the tenacity with which conservative elements blocked the victory of the Aprista Party candidate, Victor Raúl Haya de la Torre, is a measure of the degree of opposition that still exists to a real program of land redistribution such as the Apristas have advocated for 30 years.
In Ecuador, during the last two presidential election campaigns, candidates have talked vaguely of the need for agrarian reform, but until 1962 no concrete step in this direction was taken. Finally, early this year President Carlos Arosemena issued a decree declaring that the small plots of land which the landlord has been accustomed to give to the Indian for growing food for his family and building his house were to be the property of the tenant. This move aroused violent reaction from the landlords. It is of doubtful legality, in any case, unless ratified by Congress, which at present seems most unlikely to approve even so mild a measure of agrarian reform.
The process of land redistribution raises a number of basic issues: What land should be taken? What compensation should be offered? To what degree should peasants be resettled on virgin lands? How can the new proprietors be provided with credit? How can they be given adequate technical assistance? How can they be aided in getting their goods to market?
In most of the countries of Latin America, the latifundia system left idle a large part of the land available for cultivation. Some countries with agrarian reform programs, therefore, have confined themselves to seizing land which was not under cultivation. This has been the case in Chile and some of the Brazilian states, and was also true of the agrarian reform law of Guatemala. The Colombian legislation passed in early 1962 also puts primary emphasis on acquisition of unused lands by the Instituto Colombiano de Reforma Agraria.
In other countries it has been felt that for one reason or another it was not sufficient to take only unused land. In Bolivia, for instance, wherever land was cultivated by semi-feudal share-cropping, all of it was taken; but where it was tilled by modern machinery and wage labor, it was to remain inviolate, at least below a fixed number of acres. In Mexico, the authors of the agrarian reform laws were content to permit the old landholder to keep a certain amount of land, regardless of how it was cultivated, the amount depending upon whether the land was irrigated or had a natural water supply, and whether it was used for agricultural or grazing purposes. In the extreme case of Cuba, where the procedure followed the Soviet model, all lands were seized above a very low maximum area. Fidel Castro himself is authority for the assertion that many of these seizures were in violation of the agrarian reform law of 1959.
A major question has been the form and extent of compensation, if any, which should be paid for expropriated land. It has received a wide variety of answers. In all cases, including that of Cuba, the land reform laws have called for some form of compensation. The Castro government has simply seen fit not to apply the law which it wrote; but elsewhere compensation has been paid. The Cuban, Mexican, Bolivian and Guatemalan agrarian reform laws have called for payment to the landowners of the value which the proprietors themselves had declared the land to be worth for purposes of taxation. In Venezuela, the National Agrarian Institute has negotiated with each landlord in an effort to reach a mutually agreeable figure. When this has proven impossible, the matter has gone to the regular courts which have fixed what they conceived to be an adequate compensation. Under the new Colombian law, the land to be bought or expropriated is appraised by the Agustin Codazzi Geographical Institute, and its valuation serves as a basis of negotiation between the landowner and the Colombian Agrarian Reform Institute.
The form of payment for expropriated land has also been of great importance. It is generally impossible for the government to pay in cash for all the land it wants to expropriate. As a result, virtually all the reform laws have provided for payment in interest-bearing government bonds. In Mexico, Guatemala, Bolivia and Cuba the legislation has called for complete payment in bonds, although in the Cuban case these bonds have never been issued. In Venezuela, the government pays 10 percent of the expropriation price in cash, and the rest in bonds of from 10 to 20 years' duration, paying not more than 5 percent interest per year. The new Colombian law provides that when unused land is expropriated, payment shall be made in 25-year bonds, paying 2 percent interest. In other cases, land shall be paid for in cash, with annual payments extending from five to eight years, depending upon the kind of land which is being purchased.
The provisions under which expropriated land is transferred to new owners have varied greatly from country to country. At one extreme is Cuba, where, as we have seen, the state has retained most of the expropriated land, organizing it increasingly as state farms. At the other extreme is Bolivia, which has given the Indian peasant title to his land and has not sought to impose any pattern for the organization and use of the land. In a relatively small number of cases, the peasants have (with government encouragement) organized coöperatives, but in most instances they are cultivating the land as individual farmers. In Venezuela, most agricultural land has been given to the peasants as individuals, but in the case of grazing estates the government has insisted that the large land unit be preserved by establishing a coöperative. In Guatemala's abortive reform in the mid-1950s, most of the land which was distributed was given to individual peasants.
Mexico has had its own peculiar method of resolving this problem. In the early days of the reform, there was prolonged discussion of whether the peasants should be given full title to the land they received or whether a pattern of collective agriculture should be adopted. As a result of a compromise in the early 1920s, the ejido emerged as the typical pattern, whereby land was granted initially to a village or community, not to the individual peasant. If the members then wished to divide the land among themselves, they were free to do so, with each ejiditario cultivating his own acreage. In only a relatively few cases have the peasants decided to work the ejido lands in common, although they frequently join together for purposes of obtaining credit from the ejido banks, selling their products and other limited objectives.
Starting in the administration of President Manuel Avila Camacho (1940-46), the government began to issue individual title deeds which gave the peasant the right to use the land in perpetuity and to pass it on to his legal heirs, who were set forth in the deed. However, to this day, for the most part he may not sell or mortgage his land, and if he abandons it for as long as two years, it reverts to the community and can be granted to someone else. Until recently this process of granting individual deeds has moved very slowly, and the great majority of the peasants have still not received them.
For more than a decade a spirited controversy has been waged over the ejido by those concerned with agrarian reform in Mexico. One group has argued that it was time to put an end to the ejido on the grounds that the inability of the peasant to sell or mortgage his land reduced the incentive of the efficient farmer, since he was unable to increase his landholding in any case; the effect of this on the productivity of Mexican agriculture was negative, it was contended, and the ejido sector of the agricultural economy was lagging far behind that of the privately owned farms. These reform advocates favored granting peasants full title to their land, and the establishment of a maximum amount of land which any single family might own.
The other side has argued that the productivity of the ejido was not as bad as opponents maintained, and that in any case this was not the key issue. Rather, they have said, the major objective should be to prevent the reëstablishment of large landed estates-a process which they believe would be inevitable were the peasants able to mortgage and sell their land. Therefore, to prevent the growth of a large landless rural proletariat, it was necessary to limit the peasant to use rights in his land.
Officially, the Mexican Government has never abandoned its ejido policy. However, the last two administrations have granted full property rights to individual farmers receiving land along the coast. For the rest, the present government has sought to increase the peasants' feeling of security in their titles to the land. In July of this year it announced its intention of greatly increasing the speed with which use-right titles would be granted to the individual ejido members who had not yet received them; some 2,000,000 more ejiditarios are to obtain them in the near future.
It seems probable that sooner or later the ejido will cease to form the typical pattern of Mexican agrarian reform. Most peasants now have enough experience so that if they are reasonably efficient they are likely to be able to hold onto their land-particularly if the government carries out its plans to extend the rural credit system. Furthermore, the economic, social and political climate of Mexico has changed so drastically as the result of the Revolution that it is virtually impossible for the country's agriculture to revert to the kind of latifundia system which once prevailed. Finally, there is urgent need to increase rapidly the productivity of Mexican agriculture in the face of the country's swiftly growing population, and this is more likely to come about if the more efficient peasant farmers are able to obtain larger amounts of land by displacing the less efficient.
Mexico is not the only country which has put a limit on the right of the peasant to sell or mortgage his land in order to avoid reconstituting large proprietorships. In Bolivia and Venezuela, beneficiaries of land reform cannot sell their land for the first 20 years, except to the reform authorities. A modified version of the same provision was written into the 1959 Cuban land reform decree and the new Colombian law.
Under most agrarian reform programs, the peasants are granted the land without having to pay anything for it. However, the laws of Colombia, Chile and some of the Brazilian states provide for more or less nominal payments to the government. After long debate this idea was rejected in Venezuela, although it was provided that in addition to the land which they were given gratis, the new owners might purchase additional acreage at low rates. Somewhat the same provision was incorporated in the Cuban legislation.
In many of the Latin American countries there are vast areas which are all but vacant of settled population. Being virgin land, much of it is potentially highly productive, and since it generally belongs to the government it is available for distribution to land-hungry peasants without the costs of compensation. However, these regions are likely to be a considerable distance from populated areas, and a good deal of investment is needed in order to make them suitable for settlement; particularly needed are roads to get settlers in and their produce out to markets. And, of course, the land often must be cleared before it can be used.
In virtually every Latin American country that has undertaken agrarian reform, controversy has arisen over the advisability of concentrating effort on opening up and colonizing virgin hinterland as opposed to redistributing the holdings of the landlords. Over the last 50 years, limited colonization has been undertaken from time to time in the north central part of Argentina. In Chile, too, for almost two generations successive governments have engaged in small-scale colonization projects as a substitute for agrarian reform. As we have noted, a large colonization program has been pushed unsuccessfully in Peru. In Venezuela a bitter if somewhat farfetched controversy has arisen among the agrarian reformers concerning the merits of colonization as opposed to breaking up landed estates.
Actually, both of these approaches are needed. Where population pressure on the land is great, the division of large landholdings is necessary both to lessen the likelihood of social explosion and to obtain the ultimately more efficient use of the land. Redistribution is cheaper than colonization and it promises a quicker incorporation of large elements of the peasantry into the market economy. In many areas, however, sole reliance on land redistribution may merely substitute "minifundia" for latifundia. That is, there is danger that the land will be divided into such small holdings that they cannot be cultivated efficiently, or that they will never provide more than the barest subsistence. This has occurred in some parts of Mexico, where the ejiditarios have such small acreage that they are forced to supplement their income from their holdings by working as farm laborers on larger neighboring farms, or even by finding employment in nearby cities. Certainly where land hunger is keenest and where the developed land that is available will not go around, some of the would-be peasant proprietors must be persuaded to move to new areas, where more intensive work may be necessary but where the promise of an adequate livelihood is infinitely greater. Even Mexico's vast agrarian reform program cannot cope with the problem of overpopulation on the central plateau, much of which is arid. Succeeding governments have made valiant efforts to irrigate vast stretches of this plateau, but the only real solution is to convince the landless peasants there to move to fertile but unoccupied coastal areas.
A similar situation exists in north central Venezuela. In the state of Carabobo, where virtually all of the large estates have been apportioned among the peasants in plots which are considered to be of an economical size, there are still several thousand families without land. It is essential to convince these people to move to virgin areas in nearby states, where land is plentiful.
Finally, in Bolivia there is a marked need for colonization as well as land redistribution. Most of the peasant population lives in the high plateaus and valleys of the Andes, where living conditions are hard and agricultural production will inevitably remain low. However, two-thirds of the republic, most of it largely unoccupied, lies to the east of the mountains, in lowland areas stretching out to Bolivia's frontiers with Brazil and Paraguay. Much of this land is very fertile and can produce not only ample foodstuffs and raw materials for the Bolivian population, but sizable quantities for export as well. The government has spent large sums trying to prepare the way for colonization of these lowland areas. It has completed a road into the eastern province of Santa Cruz, it has established colonies of Japanese, Okinawan and Mennonite farmers in the area, it has employed a large part of the army to open up feeder roads from the Cochabamba-Santa Cruz highway as well as to clear land and build houses for settlers. Finally, it has offered the Indian peasants from the highland all of the land that they can cultivate in the eastern region. Only recently have the Indians, who are used to the bleakness and the rare atmosphere of the highlands, begun to come down in appreciable numbers. It is likely that the present trickle of settlers will soon become a rush which will begin to fulfill the Bolivians' centuries-long dream of opening up and settling the East.
The mere distribution of land is not, of course, a sufficient reform by itself. An effective program of agrarian reform must make sure that the new proprietors have access to credit to finance their crops and to buy equipment, and it must provide technical assistance and help in marketing.
Unfortunately, the banking systems of the Latin American countries are not equipped or disposed to offer the credit needed. The private banks are generally interested in purely commercial transactions, especially in the field of foreign trade. The governments with an agrarian reform program, therefore, have had to establish an agrarian credit bank or to adapt an existing institution to this task. Generally speaking, this has been one of the least successful aspects of agrarian reform in Latin America. In Mexico, for instance, regional ejido banks were established, but they soon curtailed their operations when many of the ejidos proved to be poor credit risks. Consequently, by the early 1950s these banks were helping to finance only about 20 percent of the beneficiaries of the agrarian reform, and a considerable number of peasants were being victimized by private moneylenders. In Guatemala, too, a special Banco Agrario Nacional was established to finance the new peasant landowners, but because of the overthrow of the Arbenz régime, it did not exist long enough for its efficacy to be judged.
In several countries, the attempt has been made to adapt already existing government banks to meet the needs of agrarian reform. Thus in Venezuela the Banco Agricola y Pecuario, which had originally been established to provide credit for large landholders, was used for this purpose. Today, several years after the beginning of the land reform program, the B.A.P. is still inadequate for the job, partly because its funds are not sufficient, partly because the peasants resent "their" bank lending to the big landlords, and partly because political rivalries have arisen from the fact that the bank has been directed by members of one political party, the Agrarian Reform Institute by members of another.
The original plan of the Cuban agrarian reform was for the Agricultural and Industrial Development Bank, which had been set up a decade before the advent of the Castro régime, to finance the credit needs of the peasants receiving land. However, at the end of 1959 this bank was merged into the National Institute of Agrarian Reform, and with the adoption of a state-run system of agriculture, the nature of the problem was completely altered.
Although each government which has undertaken agrarian reform has sought to provide technical assistance and advice, the results have been somewhat meager. None of the Latin American countries has had adequate rural extension services or sufficient agricultural experiment stations. They have all lacked sufficient personnel trained in agronomy and related fields to serve the needs of the vast number of new landowners created by the agrarian reform. In several countries, the United States has helped to develop the kind of expertise needed by the new peasant proprietors. The International Coöperation Administration's program in Bolivia in the late 1950s was outstanding, and in Mexico the Rockefeller Foundation was particularly successful in this field in the same period. In several countries, the United Nations has given small but valuable assistance, notably in Bolivia.
Some concept of the limited nature of the technical assistance which Latin American governments have been able to provide can be obtained from the case of Venezuela. When it undertook its task, the National Agrarian Institute had available only 4 civil engineers, 40 agronomists, 2 forestry engineers, 6 general forestry experts, 11 veterinarians and 97 miscellaneous agricultural experts. The Ministry of Agriculture had only about 30 people in its extension division.
Finally, all agrarian reform programs have faced the difficulty of getting the produce of the new peasant landowners to market. In some countries, the first problem was to arouse interest in the peasants in bringing their crops to market at all. This has been particularly true in Bolivia, where the Indian peasants have been accustomed to a self-sufficient, non-monetary economy. There is considerable debate among Bolivians and foreigners who have looked at the problem as to the net effect of the reform there on the Indians' output. Some people feel that they have tended to grow somewhat more for their own use, and as a result are generally eating better than they did before they received the land. However, there are other observers who feel that the majority of the Indians are growing very little if any more for their own families than they did before. The one thing which is generally agreed upon is that a large proportion of the new proprietors have had virtually no concern about growing a surplus for sale to the cities. Yet many of the Indian peasants in the Department of La Paz have shown a considerable interest in growing and selling enough to permit them to buy things which they never before were able to enjoy, such as bicycles, better clothes, and even radios.
Even where the peasant proprietor is generally interested in bringing produce to market, as is the case in Mexico, he has had little knowledge of what goods will sell best, and in many cases roads on which to move his goods have been lacking. It has thus been necessary to provide feeder roads to connect crop areas with highways, where produce could be picked up for shipment to market. Mexico, Venezuela and Bolivia have all had extensive programs in this field.
Another need has been for processing plants to absorb certain kinds of produce grown in quantities which cannot be consumed locally. A widely publicized incident in Venezuela in 1960 underscored this need. A group of peasants who had received land under the agrarian reform decided to grow tomatoes, which had been bringing a very good price in urban markets, instead of their traditional crops of corn and cotton. However, they had not foreseen the need for sufficient transport to ship the tomatoes during the few days in which they reached maturity. In addition, they produced more than could possibly be absorbed by their natural marketing area. As a result, a large part of the harvest rotted in the fields. Fortunately, this particularly disaster will not happen again, because soon after the 1960 crop season a large canning plant was built which could absorb all of the tomato crop and provide means of transporting it to market.
In some cases the banks which have financed the peasants have also tried to help them with marketing problems. Thus the ejido banks in Mexico buy a considerable proportion of the produce from those peasants whose crops they finance. In Venezuela, too, the Banco Agricola y Pecuario has undertaken to guarantee a minimum price and to buy several basic crops in whatever quantity they were offered by the peasant proprietors. It was intended that the Banco Agrario Nacional of Guatemala should engage in the same type of operations.
One of the basic purposes of agrarian reform programs in Latin America has been to increase agricultural output. However, in a number of cases the immediate result of redistributing the land has been a decline in production. The new peasant owners have not had the technical competence, nor in some cases sufficient interest, to maintain former output levels. The Indian peasant of Bolivia is not the only one who tends to ignore all but his own personal needs. In Mexico, too, the ejiditarios have lagged in terms of productivity, partly because they lack technical know-how, partly because the small size of many of the individual plots makes them inefficient. Most of the increases in output of Mexican agriculture in the last couple of decades have come from the lands remaining in the hands of the old landowners, now officially known as "middle-sized landlords."
One fundamental obstacle to higher productivity has been the innate conservatism of the small peasant. He is inclined to follow the techniques of his ancestors, and to grow the crops which they grew, until he is thoroughly convinced of the value of changing his ways. This is particularly true in the countries with heavy Indian populations. Hence, virtually all governments undertaking agrarian reform are faced with a basic need for education.
Venezuela has been an exception to the general rule that agrarian reform results initially in a decline of production. From the beginning, Venezuela has achieved a notable increase in agricultural output as well as acreage under cultivation. At the same time, there has been some improvement in diversification of output on the lands which have been affected by the reform. This record can be attributed both to the relatively advanced state of the peasantry and its acquaintance with a monetary economy, and to the efforts of food and raw-material processors to stimulate production. The new Heinz canning plant and the users of hard fibres have been particularly active in persuading the new peasant proprietors to grow the products needed for their manufacturing operations. The textile industry has also taken steps in this same direction.
Whatever immediate effect agrarian reform may have on production, there is little doubt that land redistribution is fundamental to any long-run increase in output in most of the Latin American countries. Under the traditional large landholding system, the proprietors have had, and still have, little incentive to augment production sufficiently to keep up with the rapid rise in population. Since their exploitation of only a part of their land by ancient methods gives them plenty of income to indulge in the conspicuous consumption which is the prevailing mark of the landed aristocracy, they see no reason to divert part of it into investment in agricultural equipment and new methods.
Agrarian reform is part of the transformation which is carrying the economy and society of Latin America from semi-feudalism and semi-slavery into the twentieth century. It raises enormous problems, for, as we have seen, much more is involved than the redistribution of land. But these problems must be solved, not only because one of the fundamental aspirations of the masses of Latin America is to possess and work their own land, but because this development is essential for the economic growth as well as the eventual political stability of the whole continent. The United States has done well, through the Alliance for Progress, to associate itself with this movement.