Andrzej Rudzienski Archive   |   ETOL Main Page

Louis Velasco

Juan Peron’s Economic Expansion

(26 May 1947)

From Labor Action, Vol. 11 No. 21, 26 May 1947, p. 6.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Argentine industry during the course of the last war went through a tempestuous development. The number of industrial workers rose more than 100 per cent. The Argentine market is no longer sufficient for it and the bourgeoisie is taking the toad of economic expansion to neighboring countries. The program of economic (and political) penetration of the Argentine dictator comprises the commercial agreements between Argentina on the one hand and neighboring countries – Chile, Bolivia, Paraguay and Uruguay. Peron is trying to form ah economic bloc around Argentina, to make sure of markets for the growing Argentine industrial production.

The Stalinists consider this policy as the realization of the democratic bourgeois revolution in Argentina, and lend their whole support to the Argentine dictator. Even certain “Trotskyist” sectors in the Argentine cannot free themselves from the powerful political pressure which Peron exercises in his country. These sectors attribute a very progressive role to Peron’s policy, considering it as the carrying out of Bolivar’s and San Martin’s program, the program of the democratic revolution, and the political, economic and social emancipation of Latin America, and its unification. There is no better proof for investigating and analyzing Peron’s policy than his commercial agreements with Chile and Bolivia.
 

The Treaty with Bolivia

The commercial agreement with Chile Caused some stir in the American press; it was the first surprising effort of the upsurge of Argentine economy. Its basis is the sale of Argentine agricultural products to Chile and the buying of Chilean fatal minerals and other products. The credit of 300,000,000 Argentine dollars to Chile and the free customs regime assures Argentine industrial penetration into Chile. The same general lines are followed in the commercial agreement between Argentina and Bolivia. In spite of his open support of Villaroel’s fallen regime and his equally open repudiation of the revolution, Peron did not hesitate to propose this agreement to Dr. Hertzog’s government. The agreement opens the doors of such a backward and semi-feudal country as Bolivia to the Argentine industrial and agricultural penetration.

Argentina has made sure of having almost a monopoly for the importation of Argentine agricultural products at, of course, very high prices. Between 1947 and 1951, Bolivia will buy from Argentina the following:

Although these figures are not large for big power capitalist countries, they are of decisive size for a very tiny economy such as Bolivia’s. They eliminate nearly all the products of other countries, or even Bolivian products themselves, for a period of several years; submitting the Bolivian market to Argentine domination.

On the other hand Argentina is introducing herself, for the first time in history, as a buyer of Bolivian products, minerals and rubber. As we know Bolivia is a country which produces only minerals, tin being the first among them. The production of more or less forty thousand tons of tin determines the national budget and Bolivian policy. The tin produced is sold partly to England and partly to the United States. The price which these two imperialist buyers dictate to Bolivia is what determines not only the standard of life of the miners, but also the national budget, the buying capacity of the country and its foreign balance, that is to say, the gains of the medium bourgeoisie and the living level of the middle class.

The present economic crisis and the July political revolution itself were influenced by the fall of wolfram, antimony, lead and tin in the international markets, temporarily saturated and too weak to acquire any more before the industrial situation is cleared up. In spite of the diminishing of reserves of tin stocks in the United States, the American buyers haggled with the Bolivian producers for a long time over the 76-cent price for a pound of refined metal, producing an impasse and also insecurity in the economic life at the country. Peron broke the impasse by offering the price demanded for 8,000 tons of tin.

And not only this, Argentina offered to buy up to 12,000 tons of tin which was surplus in the quotas of this already bid for production. The affect of this Argentine policy was rapidly apparent and obliged the United States to accede to the Bolivian producers demand for 76 cents for a pound of refined tin. Now the whole production of Bolivian tin is already promised for the following period. Argentina will acquire from Bolivia the following:

Besides this, Argentina has engaged to buy annually from Bolivia 2,000 tons of Bolivian rubber from the tropical regions of the country. The Bolivian rubber production bought by the U.S.A. during the war years varied between 3,000 and 5,000 tons. Now the rubber plantations are in a state of abandonment, malaria is taking its mortal toll among the rubber workers, misery is scourging the country, but there is no place to sell Bolivian rubber.
 

Peron’s Imperialist Policy

In order to activize Bolivia’s economic life and give vigor to the signed contract, Argentina is forming a society of Argentine-Bolivian finance, with a capital of a million Argentine dollars. The task of this society will be in reality to control the working of the agreement, as well as to facilitate the penetration of Argentine capital and industry in Bolivia, especially in the eastern frontier districts. Five hundred thousand of these dollars will be devoted to planting rubber in the tropical region of Beni. Apart from this Argentina will give a million dollars to create transport and communications by land, river and air in Bolivia. Anyone who knows the real state of things in Bolivia will understand that controlling the roads of this mountainous and Wooded country, partly unexplored, means controlling the national economy.

The upholders of the theory that Peron is the realizer of a “democratic revolution” and the “emancipation” of Latin America from Yankee influence, will be able to adduce the “progressive” and “revolutionary” role of this contract and of the economic policy of Peron, which sets American imperialism back. But prominent Bolivian Marxists adduce other arguments.

In the first place, they say, the handing over of the Bolivian market almost as a monopoly of the Argentine “Institute for the Promotion of Exchange,” a kind of Peronist monopoly of foreign commerce, especially to the Argentine exportation of agricultural produce, will put a heavy brake on the development of Bolivian agricultures, maintaining Bolivia as a one-product country, which constitutes not only its weakness face to face with imperialism, but is also a sign, an evident proof of its dependence and semi-colonial economy.

The purchase of Bolivian tin and lead, although it temporarily relieves the country’s situation, has no decisive character for saving it from Yankee pressure, and by putting a brake on the development of agriculture makes the economic slavery of the country deeper. The commercial exchange is so unfavorable to Bolivia that Argentina has been obliged to grant a credit of 50,000,000 dollars in order to settle Bolivia’s commercial balance. This fund will serve to cover the pay of the Argentine exporters being subject to a percentage of 3% per cent annually. Not only, the commercial balance but also the loan in favor of transport and industrial penetration by Argentina gives proof of Bolivia’s economic dependence and its submission to a new master. The free customs regime for the produce in transit favors Argentina, since their importations will be much greater than the Bolivians.

These same comrades believe that in spite of certain short-time advantages, the Commercial agreement between Argentina and Bolivia will have as its most fundamental consequence economic backwardness for Bolivia, and the maintenance Of its one-product character, that is to say, colonial dependency, stagnation in agriculture and the national grain milling industry, faced with the monopoly of Argentine exportation and the break put on the development of Bolivian industries. The same opponents also say that the analogous contract between the U.S.A. and Bolivia will be more beneficial for Bolivia, since the U.S.A. will force the development of agriculture as much as that of industry, being unable themselves to export agricultural, products to, Bolivia. In the long fun this will help the industrial development of Bolivia aiid raise it beyond its one-product economy and therefore aid it toward economic emancipation. Among the bourgeoisie and the middle class themselves, there is a certain misgiving and fear; in face of this Argentine expansion, Which might be; expressed in the old classical phrase “Timeo Danaos et dona ferentes.”
 

What Is Progressive in It?

Undoubtedly, the Argentine-Bolivian agreement brings relief to the present government. The lack of flour, bread and sugar can overthrow any Bolivian government. The buying of Bolivian tin and lead helps Bolivia’s economic situation. But, in the long run, it will not only make the economy of Bolivia dependent on that of Argentina, but will also hold back its economic development in the grain milling and industrial camp.

These conclusions make it easier to expose the role of Argentina’s economic expansion in Latin America, which the Stalinists and even certain “Trotskyist” groups see as “progressive” and as the realization of the bourgeois “democratic revolution” and the emancipation of Latin America under Argentine hegemony.

In the first place, we refuse to recognize “Peronism” as the realizer of “democratic revolution” in Argentina. Peronist industrial expansion is the product of the 2nd World War, which opens small “free spaces” for heretofore dependent peoples. It is a product of interimperialist contradictions of short reach; its aggressiveness being limited both in time and economic value. Therefore, Peron’s economic expansion scarcely deserves the term of “local imperialism” or “sub-imperialism.” It has grown in time, but is permitted essentially by Yankee imperialism which was previously busy with the war arid is how busy with its struggle against Russia. When Yankee imperialism returns in full force to the Latin American market, the whole of Peron’s economic and political expansion will have to bow to this sovereign lord. Neither Peron nor his successors, if there are any, will be able to carry out the unity of Latin America under capitalism, faced as they are by the huge power of North American imperialism. Any contrary supposition or thesis is reactionary Quixotry, akin to petty-bourgeois charlatanism.
 

Role of U.S. Imperialism

In the second place, Peron’s commercial agreements with Bolivia and Chile show his anti-democratic and reactionary character. The prices of the cereals sold to Chile are much higher than world market prices. The agreements seek to create certain economic privileges for Argentina in specific fields, a more hateful privilege, in detriment to the interests of the masses of workers and peasants in these countries. The function of these agreements is to hold back the development of small countries, keep them in a backward state and create for them a “status” of dependency upon Argentina.

For the above two reasons, we do not believe that “prosperity” and success will raise Juan Domingo Peron sky-high. Even today there is a strong opposition to these agreements in both Chile and Bolivia. And it is not only bourgeois opposition. Since Peron’s economic policy is not democratic, but an expression of the reactionary “sub-imperialism” of a backward and reactionary bourgeoisie, it will neither be able to impose itself on neighboring countries nor reach beyond to carry out finally the political and economic unity of Latin America. In the imperialist field, the biggest fish devour the smaller ones. Yankee imperialism will devour backward and local Argentine sub-imperialism.

Therefore, to attribute a progressive democratic-bourgeois character to Peron’s economic policy and expansion, or to call on the proletariat to support him, constitutes a grave error, a revision of Marxist theory, especially of Marxist theory on imperialism.

The emancipation of Latin American peoples can only be effected by way of a socialist revolution in the backward countries – those of the Pacific coast in the first place: in Bolivia, Peru, Paraguay, Colombia, Venezuela, partly in Chile. Only the Latin American proletariat, allied with the proletariat of the U.S.A. is capable of carrying out the unity of Latin America, its national, social and economic emancipation, creating the United Socialist States of Latin America.

For this reason the proletariat will not support Peron in his fight against Yankee imperialism, but will maintain its own third front, directed against all imperialism, whether it be Wall Streets’ world imperialism or Peron’s local native imperialism, for the socialist revolution and the Socialist United States of Latin America.

 
Top of page

Andrzej Rudzienski Archive   |   ETOL Main Page

Last updated: 17 October 2022