Source: Fourth International, Vol. I No. 7, December 1940, pp. 182–187.
Translation: Bernard Ross.
Transcription: Daniel Gaido.
Mark up: Einde O’Callaghan for ETOL.
“The struggle for South America grows sharper daily,” said Lenin in 1916 in his book Imperialism: The Last Stage of Capitalism. We can say today that the struggle for South America, one of the most important sources of raw materials and, according to statements of the interested parties, “the world’s greatest market,” has reached a culminating point which threatens to develop into a real battle between the three or four large imperialist powers.
For several years this struggle has been unfolding throughout the entire continent with increasing intensity. The people of South America see themselves being propagandized from all sides by the contending imperialist gangs. We are constantly visited by open and secret agents who go everywhere, study everything, list and examine, endeavoring in one way or other to manipulate the puppets from behind the scenes of local politics.
We listen daily to radio broadcasts transmitted directly from Berlin, London, Paris, Rome or New York, bombarding us with ‘“‘news” and special programs of propaganda for their respective imperialisms. In all our cities special daily newspapers, serving one or another imperialism, devote themselves to attacking their rivals while other papers of the mercenary press brazenly sell themselves to the highest bidder. There arrive in our countries one after another “special missions” for propaganda work which make use of “good will” aerial squadrons, visits by well-known actors, etc. English, Italian, Japanese, French, German, and American warships follow one another in a series of endless visits to the principal seaports of South America, bringing “greetings” from their respective navies and at the same time studying our coasts minutely in search of better sites to establish shelters and naval bases. The lines of aerial navigation under the control of the various imperialist countries, not only tighten their connections with their respective centers, but also extend as far as they can into the interior of the South American countries in a ferocious competition which has lasted up to the declaration of the new World War. With great publicity, “cultural” commissions of the rival imperialist powers arrive on our shores to give lectures, and invite reciprocal visits from the South American countries with all expenses paid. All sorts of scholarships are granted to South American students who were never more welcomed.
These are among the gentler methods used by the different imperialist countries to gain possession of our wealth. A war to the death goes on among America, Germany, Italy, England, Japan and France to displace each other’s commodities on the South American market and in that brutal struggle all means are made use of. American and European military and police missions come to instruct the armies of the South American countries and to extend the influence of their respective nations. Political parties are financed and even set up in each of the republics of the continent, aiming to obtain power for the purpose of serving their particular imperialist master and without in the least taking into consideration the opinions or desires of the populations of their countries. Boundary disputes are also played up by the imperialists in order to maintain a favorable atmosphere for imperialist penetration. Finally, all kinds of pressure are exerted on the governments in power to obtain concessions, trade treaties, secure zones of influence or obtain privileges which would assure to each imperialist power advantages or. preponderance over its competitors in the gigantic battle for the division of the continent.
Until now, perhaps, humanity has never witnessed such a struggle. No other continent has been the theater of such a dramatic spectacle; neither Africa nor China even at the peak of the inter-imperialist struggle. Lenin was correct in predicting that, since all the colonies of the world are distributed, the next struggle of this kind would take place for the conquest of the semi-colonies, among which Latin America is included. We can see how that struggle has come to a head during the last twenty-five years.
The imperialist war of 1914–18 marks a most important stage in the struggle for South America. Until then English capital was dominant in South America. There were also some smaller French investments. During the last years preceding the war, German competition began to make itself felt, especially in the countries along the Atlantic. But Britain was supreme. Railroads, banks, insurance companies, ports, lines of maritime and river navigation all over the continent; extraction of petroleum in Peru; tin in Bolivia; the nitrate industry in Chile; slaughter houses, ranches, lumbering, water power companies, telephones, trolley-cars in Argentina; coffee in Brazil; electric companies etc., that is to say, all the keys to Latin American economy, were in the hands of Great Britain, where the greater part of the national, provincial and municipal loans of those countries also had been raised.
But the warlike conflict which brought England face to face with the German peril opened the doors wide to another imperialism, that of the United States, which spread over the continent with dynamic energy, within a few years displacing its British rival from the larger part of our countries.
Yankee imperialism, which came upon the world arena after the Spanish American War of 1898, started to invade Mexico and Central America aggressively at the beginning of the present century under the aegis of “dollar diplomacy” and the “big stick” policy inaugurated by President Theodore Roosevelt. But Yankee imperialist expansion throughout South America started only during and after the First World War as a result of which the United States became a first-class industrial power. The war permitted the United States to capture markets until then in the hands of European countries but which they were compelled to forsake during the conflict. In large part those markets were lost forever. Thus the United States set its feet in South America which, in accord with the Monroe Doctrine, it judged to be a sphere of exclusive influence for itself.
In the years following the war the United States seized, one after another, the principal sources of South America’s wealth. The United States obtained enormous petroleum concessions in Venezuela, Bolivia and Peru; the copper mines of Chile and Peru began to be exploited on a tremendous scale; control of the Chilean nitrate industry was acquired from English hands; competition for the industrialization of the meat industry began in Argentina and Uruguay; coffee plantations were financed in Colombia; tanneries were established in Paraguay; the larger part of the continent’s sources of electric industry were seized; enormous concessions for rubber exploitation were obtained in Brazil. Yankee corporations acquired the interests of British telephone companies in some of our countries; automobiles and busses which competed with English railroads invaded the South American market; industrial plants, subsidiaries of those in the United States, were built; maritime navigation lines were established and an extensive network of aerial communications spanning the entire continent were extended; branches of leading United States banks were established.
The United States also became the principal exporter to this continent and the greater part of South American loans was raised in New York. The amount of American capital in South America increased by 1200% from 1919 to 1930, while English capital remained stationary. The South American countries, one after another, were falling under the control of Wall Street.
In 1928, before assuming office, the newly-elected President Hoover took a trip around South America to visit the principal “sphere of influence” of the United States. And two years later, at the beginning of the 1929–34 world crisis, Yankee influence reached its summit as a result of General Uriburu’s coup d’etat in Argentina and Getulio Vargas’ subversive movement in Brazil, which removed from power in those two large countries executives tied to the European rival of American imperialism – England. With that, Yankee imperialism’s domination of the South American continent was almost complete.
But that situation did not last long. The fall of the Chilean dictator Ibanez, in 1931, was a blow against Yankee control in that country. And English imperialism regained its positions in 1932 as a result of a change in the government in Argentina, England rooted herself firmly in that country from where she tried to drive back the advance of the United States and regain her lost positions on the continent.
The Argentine republic is the most important South American market. There is also more foreign capital invested in Argentina than in any other South American country. In order to control that market and obtain special concessions, American enterprises, primarily Standard Oil, financially aided and collaborated in the coup of General Uriburu, who overthrew president Yrigoyen, notorious anti-Yankee and friend of England. But within a short time Uriburu had to yield power to General Justo through whose government England regained her predominance in Argentina. The latter fact was notably accentuated because the Argentine cattle-raising bourgeoisie, who control the country, after being excluded from the English market as a result of the Ottawa convention of 1932, signed the following year the Roca-Runciman treaty with Great Britain. In compensation for the maintenance of the British market for their frozen meats, this treaty granted concessions to England which signified the almost complete subjection of Argentine economy to British imperialism.
The concessions consisted, principally, in the “favorable treatment” of English capital invested in Argentina, which reached the sum of 450 million pounds sterling. As an expression of those concessions, British capital, which for the most part is invested in tramways and railroads, was aided by the Coordination of Transports Law which helped that capital earn great interest by freeing it from the, competition of automotive transport. Also, the pound was exchanged for 15 Argentine pesos to pay off the interest on that capital while the official rate fixed the pound at 19 or 20 pesos. That was brought about by the establishment of exchange control which favored the importation of English commodities and assured at the same time punctual payment of interest on the external debt held by England. The establishment of the Central Bank completed the financial control.
English imperialism in Chile regained some of her influence, without attaining dominance, when President Alessandri took office in 1932. Ross Scrutamaria, Alessandri’s minister of finance and later a candidate for the presidency, had old connections with London.
The year 1932 also witnessed another British counterattack. The Sao Paulo coffee oligarchy, tied to English capital, which for many long years had dominated the country until they were thrown out of power by Vargas in 1930, rose against the latter, trying to regain their old preponderance. They did not succeed, being smashed by the pro-Yankee government.
But the clash was most violent and tragic in the Chaco territory which was disputed between Bolivia and Paraguay. Under pressure of American petroleum companies who needed an outlet in eastern Bolivia for the production of their wells, the latter country rose, arms in hand, to conquer the disputed territory and extend its territory as far as the Paraguay River, and thus obtain a port with an outlet to the Atlantic, Those aims were resisted by Paraguay, prodded on by Anglo-Argentine interests controlling that country’s economy. Paraguay held back the Bolivian advance and seized the disputed territory.
In the meanwhile, English control increased in Argentina and gave Great Britain the opportunity to attack and injure in many ways her rival, the United States. The results of that counter-attack were soon easily visible: Argentina reentered the League of Nations while at Pan-American conferences it took up a belligerent attitude toward the United States. So far as commercial matters were concerned still greater favoritism was displayed towards English commodities, through the control of exchange under the pretext of “buying from those who buy from us.”
On the other hand, all sorts of hindrances and custom duties on American commodities were closing our markets to imports coming from the United States. The outstanding case concerned the importation of automobiles from the United States, which became so difficult that there arose what was called the “demotorization” of Argentina. Despite the construction of an extensive network of concrete roads throughout the country, the number of automobiles in Argentina in 1938 was much less than the number in the country ten years earlier, when Argentina had been among the leading vehicle-possessing nations.
As a result of these and other measures against American interests in Argentina, capital invested by the United States in that country diminished, according to data in the Bulletin of the Pan-American Union, from 700 millions of dollars in 1931 to 3S0 millions in 1938. The offensive against American companies in Argentina was so great that in 1937 the Standard Oil properties were sold to the Argentine government. The sale, however, did not go through. That entire situation aggravated economic relations with the United States and led to the breakdown of attempts to sign a commercial treaty.
At the height of the 1929–34 world crisis, while Yankee imperialism was reaching the pinnacle of its influence and Great Britain was preparing for her counter-attack, a new and unexpected competitor appeared on the South American scene: Japan, which began to flood the continent with cheap commodities, and began to increase in geometrical proportion its commerce with our countries. At that time Italian commerce was insignificant and Germany had not yet fallen under the heel of Hitler. Japan was the first of the totalitarian nations which appeared in South America.
Japan not only invaded South America with cheap commodities but also obtained concessions in Brazil (in the southern states and Amazon territory) where Japan sent large contingents of immigrants. The Asiatic Empire also increased its influence on the western coast of the continent, especially in Peru.
When Japanese commercial penetration reached its height and gave rise to considerable alarm among English and American competitors, Hitlerite Germany pitched into the struggle and very shortly supplanted the Japanese threat, appearing as a much more powerful and serious rival. That happened in 1934.
Germany and Brazil signed a commercial treaty in 1935 by which the former bought products, especially cotton, which would be paid for, not in international exchange but with so-called “compensated marks” which could only be used to acquire commodities from Germany. This treaty was the beginning of the formidable German commercial offensive in South America which lasted until the outbreak, of the present imperialist war.
As a result of that treaty, Brazil’s trade balance was in Germany’s favor and Germany displaced the United States as the leading exporter to Brazil in 1936 and 1937. Through treaties based on the “compensated mark” or barter, that offensive extended over the rest of Latin America.
With this trade, Germany acquired at low prices large quantities of indispensable raw materials, which were not totally consumed but resold in other European markets with the aim of obtaining necessary international exchange to purchase other commodities abroad. The South American countries unburdened themselves of large stocks of products, receiving in exchange German merchandise which replaced the products of other countries.
Germany thus acquired the coffee and cotton crop in Brazil, wool in Uruguay, etc. German commerce in 1936 dislodged the United States from first place in Chile. One after another, the Latin American countries fell under the lure of German trade which continued its penetration by means of barter operations: machinery for cereals in Argentina; for petroleum in Bolivia. Germany did the same with Mexico.
The Nazi-fascist offensive was not simply satisfied with the conquest of South American markets. Nazi penetration was also advanced by all kinds of propaganda, organizing German residents, educating the youth by Nazi methods, forming important sections of the Nazi Party, financing and directing the formation of political parties, such as the “Integralist” in Brazil, the Nazi party in Chile and the so-called “Nationalists” in Argentina.
But the ambitions of the Nazis extended still farther, embracing such large-scale projects in the different countries of the continent as the construction of a gigantic hydroelectric plant in Uruguay, the lease d the entire Acre territory in Brazil for the exploitation of rubber, the construction of an extensive pipeline through the Chaco territory to convey Bolivian oil to the Paraguay River. It even appears that plans were drawn up for the seizure of Patagonia. German air lines began to traverse the entire continent.
Nazi influence was unmistakable in President Vargas’ coup d’etat in Brazil in 1937. Knowing that he could rely ON the support of the Integralistas, Vargas proclaimed the establishment of a totalitarian government. President Busch of Bolivia also revealed sympathies for Germany m the struggle he carried on against Anglo-American mining and petroleum companies until his suicide in 1939. The outbreak of the present war which separated Germany from South America as a result of the British blockade, has paralyzed but not killed the Nazi imperialist plan of expansion. It lies hidden in the shadows, awaiting the turn of European events.
Upon first assuming office, Roosevelt said in his inaugural address: “I wish to dedicate this nation to the policy of the good neighbor – the neighbor who resolutely respects himself and because he does so, respects the rights of others – the neighbor who respects his obligations and respects the sanctity of his agreements in and with a world of neighbors.” Thus was laid the keystone of a new foreign policy for the United States, the policy of the “good neighbor” through which a new era was to be initiated, especially m relations with the republics south of the Rio Grande.
The marines who for many years kept a close watch on American interests in Nicaragua and Haiti were withdrawn immediately. Guarantees were given that the United States would not intervene in Cuba and, a few months later, even the Platt Amendment which gave the United States that right was erased from the Cuban constitution.
It was easy to see that the new American attitude was nothing more than a change of front, the adoption of more refined methods, abandoning those barbarous and primitive methods introduced by Theodore Roosevelt. Confronted with a developing inter-imperialist battle in South America, the United States changed its methods in order to fight more effectively against European and Asiatic rivals. The former crude American policy had given rise to enormous resistance upon the part of the Latin American countries, creating an anti-American atmosphere, unfavorable to Wall Street interests and which was utilized by imperialist antagonists.
The “good neighbor” policy found praise in Latin America. For many “statesmen” of the old school, the United States had at last comprehended what its true attitude should be. The United States was now assuming the role corresponding to its size, that of a big brother; Yankee imperialism no longer existed and must henceforth be considered a closed chapter of history. And there were still others who affirmed that in the United States, Latin America had its best friend in case of attacks from other imperialist countries.
Nevertheless, under cover of the “good neighbor” policy, the United States was looking for the best way to struggle against European and Asiatic rivals and to expel them from the continent, and accordingly intensified its efforts to penetrate into Latin America. With that end in view, the United States raised the watchword of the “struggle for democracy” against fascism, endeavoring to appear as a champion of peace and racial tolerance.
Sheltered behind such ideals of unity and brotherhood, Washington made a formidable attempt to assure Wall Street’s total and exclusive domination of Latin America. Bilateral treaties were signed, like the one with Brazil, which granted special concessions at the expense of imperialist rivals, in order to combat German barter; credits were extended to South American countries to make it easier for them to purchase American commodities; military missions were dispatched to instruct the armies of the various Latin American countries; obsolete warships were offered on lease to defend, so it was said, the coasts of South America; aerial squadrons, such as the “flying fortresses,” were sent out on spectacular propaganda raids all over the continent. Traffic with our countries was increased by means of maritime lines called “good neighbor fleets”; the world’s most extensive network of aerial communications was extended over the whole of Latin America; pressure was exerted against several Latin American governments to compel them to take measures against imperialist competitors of the United States (this happened in Brazil where concessions to the Japanese were revoked); special loans were granted (to Paraguay after the election of President Estigarribia, ex-ambassador to Washington) to build highways which would compete with English railroads, etc.
But the principal arm brandished by the United States in its penetration of Latin America was the specter of war and the totalitarian threat. Under that guise a series of Pan-American conferences, with shorter and shorter intervals between them, have taken place, whose sole purpose was to legalize and obtain the consent of the Latin American governments for the vast plans of Yankee imperialism to transform Latin America into the exclusive sphere of influence of Wall Street interests.
The United States accomplished little in that direction at the 1933 Montevideo Conference because the “good neighbor” policy was something new and the Chaco War was an open wound which for the time being hindered all attempts to attain continental unity.
Therefore the first serious attempt to line up the Latin American nations into a bloc under the hegemony of the United States was the s-called Buenos Aires Peace Conference in 1936 attended by President Roosevelt. At that conference, under the pretext of safeguarding peace, Yankee imperialism prepared for war, aspiring moreover to separate all the Latin American countries from any kind of extra-continental imperialist influence, whether it came from Europe or Asia. The United States also drew up a “customs truce” which would favor the introduction of its commodities in Latin America. However, the aim desired by the United States came to naught because of the attitude of Argentina, which was of course impelled by England.
The Lima Conference in December 1938 met in full view of German commercial penetration. The Roosevelt government which now spoke insistently about the Monroe Doctrine again proposed the formation of a bloc, which, more precisely speaking, had certain characteristics of an inter-American alliance, instead of the American League of Nations advocated by Columbia and the Dominican Republic. That effort failed again because of the Argentine attitude. The latter country, however, signed the Declaration of Lima which established consultation among the American governments. Little by little, the bloc or alliance was approached, the alliance between wolf and sheep which Yankee imperialism desired in order to attain for exclusive use the fruits of Latin American exploitation and also to make certain that these countries would be dragged into the next war.
The next conference in Panama in 1939, convoked because of the outbreak of war in Europe, established the so-called “security zone.” Little was added to the accomplishments of former conferences except for the intensification by the United States of the campaign to create a favorable atmosphere for inter-American collaboration.
The Second World War broke out in Europe when the inter-imperialist struggle for South America was at its height. And, as was to be expected, the war brought profound changes in the relationship of forces between the powers, producing led situations favorable for the United States.
In the first place, German trade, which had provoked so much alarm, was eradicated completely from the South American market by the British blockade. The war meant, too, that England could not very well supply the imports needed by the South American nations. And, on the other hand, since the beginning of the war with China in 1937, Japanese trade with Latin America had fallen considerably. All those circumstances directly favored the United States, which filled the space left vacant by Germany in the total of South America’s imports. The trade of England (before the war that country also had begun to resort to barter) remained stationary.
At the same time, the South American countries have seen almost the entire continent of Europe closed as a market for their exports. Even more: they confront the perspective of losing the entire European market if Hitler occupies England. And if the world war spreads to the Far East, trade with Japan would very probably cease. The United States would remain as the absolute master of South American commerce. Such are the actual perspectives towards which we are being carried.
Confronted with such contingencies and possibilities, the United States is preparing to exploit the situation and attain its old aim of complete and exclusive domination of Latin America and the entire western hemisphere. As a new step in that direction, the United States recently decreed that European possessions on this continent cannot change ownership, that is to say, if the present owners should no longer rule, only the United States can take over those possessions. Any other expedient that may be adopted to dissimulate this fact, such as the establishment of “Pan American Mandates,” spoken of lately, will be nothing but attempts to mask the real possession of those territories by the United States.
Even should Hitler be defeated and the European colonial powers regain their old position, the United States undoubtedly would continue to hold their possessions in this hemisphere either as a result of purchase or payment for war debts. The same will be the fate of British, Belgium, French, Dutch and Scandinavian interests in our countries.
The decline of England is particularly rapid and the indications are that, whether she wins or loses the present war, Great Britain will disappear completely as a decisive factor from the inter-imperialist struggles in Latin America. Nevertheless, Britain has not yet surrendered and her influence still persists in the Rio de la Plata zone, although it decreases daily and the Argentine bourgeoisie is more and more disposed to throw in its lot with the United States in the Western hemisphere.
Although Hitlerite Germany is at the present time cut off from relations with South America, she maintains groups and organizations which in some countries are of real importance, the so-called “fifth columns,” which await favorable circumstances in the development of European events which will allow them to dispute with the United States for domination of the continent.
In the meanwhile, the United States actively utilizes the present situation to increase its economic, political and military domination over Latin-America. Through schemes which in part were presented at the Havana conference, such as the creation of an Inter-American Bank, the establishment of an American economic cartel and plans for “continental defense,” including the cessions of naval and aerial bases in the principal strategic points of Latin America, the United States strives toward that goal. Then again, the United States surely will re-introduce those projects for the formation of an American “customs union,” proposed at the first Pan-American conference which gathered in Washington in 1889.
To make certain that the Wall Street bankers earn their super-profits American imperialism will also work out joint plans with the parasitical and sycophantic bourgeoisie of our countries to smash all rebellions and liberation movements of the continent’s exploited and oppressed masses. With such a goal in mind, Yankee imperialism at the moment it considers proper, will hurl against our countries the entire gigantic military apparatus which is being built today to confront robber rivals from other continents. Moreover, the multilateral Monroe Doctrine advocated by President Roosevelt endeavors to chain Latin America to the war machine of the United States and will be used to drag those same, exploited masses into the struggle to serve as cannon fodder in the imperialist war.
The world is on the point of being divided into three gigantic zones of influence between the large imperialist powers. Europe for the Europeans says Hitler; Asia for the Asiatics shouts Japan; America for Americans, the United States repeats once again. Each of those powers proclaims its regional Monroe Doctrine which in reality signifies: Europe for the Germans, Asia for the Japanese and America for the Yankees. After they are transformed into continental masters, each of those powers will aspire to become the world master, unless their plans are disrupted by the socialist revolution which may break out at any moment in Europe or Asia.
But the methods each uses to attain domination are distinctive. Japan invaded China with the pretext of “defending” her from communism. Germany invaded several European nations to “defend” their neutrality threatened by England. The United States takes possession of Latin America with the fable of “defending” it from fascism.
But while Japan and Germany were compelled to resort to arms to carry out their conquests, the United States is acquiring its conquests peacefully, at least for the time being. American penetration, better concealed and more artful, is hardly noticed by the Latin American people deceived by their principal leaders who by selling themselves to imperialism betray their interests.
It is not only a question now of the Latin American rulers who are old tools for imperialism’s oppression and domination. The very leaders who claim to lead the masses, even such parties as the Aprista which formerly attacked Yankee imperialism, today praise the United States and open the doors so that it may enter “to defend us from totalitarianism.” Recently when the activities of the Nazi-fascist “fifth column” in Uruguay were revealed in the sensationalistic form which serves the United States, several leaders of the popular masses requested that the American cruisers in Uruguayan ports prolong their stay, especially because of those circumstances. Rarely has one witnessed greater betrayal and worse crimes which aim at delivering our countries into the clutches of their worst enemy.
There remains, too, the discredited voice of Stalinism which is now attached to the Nazi “fifth column” and tomorrow will change face and transform itself again into a surrender brigade. Other pseudo-leftists are of the opinion that the only way to oppose American penetration is to deliver themselves to Nazi imperialism.
Only the small forces of the Fourth International remain to prepare and lead the South American proletariat in the struggle of our countries to liberate themselves from the claws of all imperialisms.
For the time being all indications are that the United States, which has spoken of extending the Monroe Doctrine to Antarctica, Greenland, Iceland, Canary and Azores Islands and even the Dutch East Indies, will become the exclusive master and sole heir to the interests of the extra-continental powers in South America.
The collapse of the British Empire within a short time will mean the disappearance of England as an imperialist competitor. And in one way or another, with or without battle, so-called “fifth columns,” German, Japanese or Italian, will soon be definitely smashed, leaving Wall Street as the exclusive owner of the Western hemisphere. It is easy to anticipate that before that goal is reached Yankee imperialism will remove the mask as a defender of liberty and appear in its true aspect, that is to say, as one of the most brutal and bloody of imperialisms.
Confronted with this perspective, the revolutionary vanguard of the South American proletariat extends a cordial hand to the working class of the United States, its ally in the struggle against their common oppressors. Through our comrades of the Socialist Workers Party, we send a cordial greeting of hope and understanding to the American proletariat.
Buenos Aires, July 22, 1940
Last updated on 26 February 2016