Coffee: The Epic of a Commodity (37 page)

In 1871 he promulgated the “lei do ventre livre,” the “law of free birth.” It ordained that no one could any longer be born to slavery in Brazil; the children of slaves were free. The practical effect of this would be that by 1900, when the older slaves would be dying off rapidly, slavery would be in course of extinction, slowly at first, then swiftly. The coffee-planters could adapt themselves to what was, after all, a distant prospect, without any immediate and grave disturbance of labour conditions upon their estates. But there were revolutionists at headquarters who considered that the proposed method of emancipation was too slow. When the emperor was visiting Europe for the sake of his health, in 1888, his daughter Izabel, who was acting as regent, promulgated the “lei aurea,” the “golden law,” whereby slavery was abolished forthwith, completely, and without compensation to the planters. These latter, not being in a position to pay adequate wages to their ex-slaves, rebelled against the emperor. Hitherto they had been loyal monarchists, full of respect and admiration for the man to whom they owed their roads and railways; but now, in their despair, they joined forces with the republicans. Army officers collaborated in the revolt, and on November 15, 1889, the Brazilian empire fell. Pedro, who had by now returned, was forced into exile. When the telegraph conveyed the news to other American capitals, the president of Venezuela, Rojas Paul, uttered the memorable words: “They have done away with the only republic that existed in America, the Brazilian empire!”

The planters did not venture upon the re-establishment of the slave-holding system. Still, they got out of their difficulties quickly enough. Nothing was needed to overcome the labour crisis but intensified immigration from Europe.

Slave-labour had been cheap, but it had been of poor quality. You cannot see more than a few paces in a coffee-plantation, and, when they were not under the eyes of the overseer, the Negroes took things easy. The planters had long known that European free labourers, though costly, worked much better than Negro slaves.

Heinrich Schüler, who has made a special study of the question, estimates that from 1820 down to the present day about six million persons have migrated to Brazil. He believes that fourteen millions of the population—nearly two-thirds of the total—consist of immigrants or the descendants of immigrants who have come to Brazil during the last hundred years. But from year to year the number of immigrants varied much, just as did their fortunes. While slavery was still in being, the free whites generally worked on the system known as metayage, receiving as their wages half the crops of the land they tilled. Thus the white immigrant was not a slave, but neither was he a free landowner, and he was therefore in an inferior social position. Metayage soon led to exploitation of the colonists, and the stream of immigration fell off. Von der Heydt’s decree, issued in the year 1850, forbade Germans to emigrate to Brazil. This had important political consequences, for it directed German emigration towards the United States.

The evil repute into which Brazil fell as “a country of exploiters” led the Brazilian government to take action. It freed the immigrants from their contractual obligations, and did its utmost to create a class of free peasants. Every colonist received a house and a suitable area of tilled land where he could plant coffee-shrubs, and where between the rows of coffee he could cultivate cereals. His wife and children would work with him. If he were a thrifty man, he would soon be able to buy land for himself and become an independent planter. The most successful of such immigrants was the famous Francisco Schmidt. He came to Brazil as an ordinary labourer and set to work as a metayer. In the year 1918, the Schmidt family united their fifty-two “fazendas”—the largest coffee-plantation in the world—into a joint-stock company with a capital of fifteen million marks.

All the same, prior to 1888 the number of immigrants barely reached thirty thousand per annum. Then the emigration agents in Europe heard of the fall of the empire and the abolition of slavery in Brazil. Immediately the current of emigration became intensified. In 1888 the newcomers to Brazil numbered one hundred and thirty thousand; and in 1891, the figure rose to two hundred and twenty thousand. The “lei aurea,” the emancipation edict, which for moral and political reasons was irrevocable, had been issued during a period of prosperity and high prices. The plantations were being greatly enlarged, and there was a shortage of labour. The republican government ably supported the planters, and helped to finance immigration from Europe.

Entrepreneurs in São Paulo founded a steamship line running from Italian and other Mediterranean ports to Brazil. The number of Italian immigrants during 1888 equalled that of all the Germans who had come to the country since 1835. The outflow of Italians had to be restricted by the Italian government. The Italians were followed by Portuguese and by Spaniards. In Germany, on the other hand, the psychological after-effects of von der Heydt’s decree were still operative. Among the two hundred and twenty thousand immigrants of the record year 1891, only forty-one hundred Germans came to Brazil.

Asia, as well as Europe, contributed its quota to the aid of Brazil. Japan, always on the look-out for living-room and for new markets, saw that there was a fine opportunity for instituting commercial relations. It guided the stream of Japanese emigration towards Brazil, to follow up men by Japanese manufactured goods. Brazil needed labour; and, since Japan was a country where very little coffee was drunk, the Brazilian planters hoped to get rid of some of their surplus in the Land of the Rising Sun. They were mistaken, for a tea-growing country would never become a coffee-consuming one.

On the Asiatic mainland, opposite Japan, was the huge realm of China, overstocked with yellow labour-power. Why should not China export coolies to Brazil? In the 1890’s there was formed a syndicate in São Paulo to bring fifty thousand Chinese labourers to the centre of the Brazilian coffee industry. The planters proposed to advance money to defray the cost of the voyage and to guarantee a minimum wage. Chinese coolies were to contract for five years. The Peking government, however, was not satisfied with the conditions, and called the bargain off.

Since the demand for labour exceeded the supply, wages rose. Then, in the year 1900, the planters were hard hit by the fall in the price of coffee, and were unable to pay the wages they had promised. Italy took diplomatic steps on behalf of her subjects in the Brazilian plantations. The planters were in so desperate a position that the Brazilian government had to advance money. It hesitated for a time. But when Giolitti and Tittoni threatened to prohibit Italian emigration, Rio was compelled to come to terms with Italy.

It was in accordance with the law of coffee-crises that the Brazilian planters should be once more in a bad way towards the turn of the century. This time, however, the crisis was worse than usual, owing to the fall in the Brazilian monetary exchange.

What had happened to the milreis currency?

Immediately after the abdication of Emperor Pedro II, on November 15, 1889, Brazilian money began to totter. New York and London, although the former by hypothesis was republican in sentiment, and the latter—at that date—still quasi-republican as far as other lands were concerned, had regarded the dominion of the House of Braganza as a safeguard in Brazil. During the six years after Pedro was given his marching orders, the value of Brazilian currency in the international exchanges sank by two-thirds.

This fall in exchange was, to begin with, very much to the planters’ taste. They sold their coffee for sterling in the London market. Prices were not high (if they had been, over-plantation would have begun again); still, a planter could now get three times as many milreis as he used to get for an English pound. The value of currency never falls so much or so quickly at home as it falls in the foreign money market, for a population is faithful to its own standard. Therefore it did not matter to the planters that they had to employ costly wage-labour instead of cheap slave-labour. They could get along all right, for a time.

But the coffee-barons were to find, as inflationists have always found, that the advantages of inflation lead to disaster. When the State, as was meet, determined to stabilize the currency, they perceived that their welfare had been illusory. It was, of course, necessary to arrest the fall in the milreis. Brazil had to pay the interest on her foreign loans in the currency of the creditor countries, and if bankruptcy was to be avoided, the purchasing power of the milreis must not be allowed to fall to zero. In 1898, Manual de Campos Salles, the new president, undertook, with the aid of the house of Rothschild in London, to steady the state finances. He succeeded so well, that the milreis was soon quoted at a better figure. But state bankruptcy was avoided at the cost of the ruin of the planters.

A considerable proportion of the plantation-hands took advantage of the rising exchange to book their passages for Europe and return home. A good many, however, procured well-paid work in Rio de Janeiro. Now that the state finances were on a sound footing, the building trade was busy; new quarters of the town were being laid out, and the docks were being enlarged. Thus the plantations were gradually deprived of their workers, and in the end this was advantageous, as a hindrance to crazy over-production. Not an adequate hindrance, however, for during the years of spurious money, when the planters had had such a lot of inflated milreis to play with, they had, after their usual custom, used their money to plant more and more land. Coffee was growing like a demon in a nightmare. Since there were no hands to harvest the crops, the berries fell to the ground as they ripened.

Owing to the rise in the Brazilian exchange and the decline in the price of coffee, the income of the planters was being steadily reduced. There could be no question of raising the price of coffee. The coffee planted on extended areas during the years of prosperity was lying in wait to prevent anything of that kind.

Catastrophe seemed inevitable.

The newspapers clamoured for a saviour. Not, in the sense of Europe, for a “deliverer from scarcity and need,” but, on the contrary, for a “deliverer from superfluity.” In numberless variations there now became current a proverb: “Terra rica—povo rico.”

Wealthy land—poor plutocrats!

E
CONOMIC
history is harder to write than any other kind of history. Why? Because in economic history the ostensibly life-less makes vast claims, and because a living creature, man, is unimportant and powerless as against the might of commodities.

Was not man the creator of economics?

No, or only in part. Man is the father, the progenitor of economics, but nature is the mother. One who speaks of the growth of economic life, a life that is mysterious, peculiar to itself, and not always reasonable, is not speaking only or mainly about something that is the product of the human mind, but about something that depends quite as much upon the blind forces of inscrutable nature.

While in Brazil the soil, the form of government, and the power of human labour were wooing the terrible favour of coffee, what was the attitude of other colonial countries towards a phenomenon which to them represented not frightfulness, but fertility?

Not without a struggle had other tropical countries surrendered to Brazil the hegemony in the production of coffee.

Towards 1830, the race among the colonies for the premier position in this respect began. New names came to the front, and were soon forgotten.

The “favourite” in this competition had originally been Java. The island realm of the Dutch had long been settled by coffee-planters who, therefore, were no novices at the game. Their fathers, grandfathers, and great-grandfathers before them had been coffee-planters. Still, this did not prevent the relations between the coolies and their Dutch overlords from growing worse and worse. Coffee-growing in Java was a government monopoly; the natives were compelled, under the supervision of Dutch officials, to tend a definite number of bushes annually and to harvest the crops. Each family had to look after six hundred and fifty-five bushes. The yield of these “coffee-looms” was taken over by the government from the coolies at a fixed and very low price, the authorities then disposing of the crops by auction through the instrumentality of the Netherlands Trading Company. In addition to this coffee-growing, carried on by what was virtually forced labour, there existed voluntary cultivation in small areas that were the property of the Javanese, but naturally, in the circumstances, they lacked time and energy to attend to their private farms. Multatali—the pen-name of Eduard Douwes Dekker (1820–1887)—in his autobiographical novel
Max Havelaar
, published in 1860, pilloried the administration of the Dutch Indies, describing the forced labour of the natives in plain terms as a corvée. Since their work was unwillingly performed, it was comparatively unproductive.

With the decline of Javanese production, Central America began to come to the fore. Three factors combined to stimulate the ambition of these petty states. First of all, the example of Brazil; second, the consideration that Central America was nearer to North America and its big markets for coffee than South America was; third, liberation from Spanish rule had awakened industrial ambition as well as stimulating national sentiment. The upshot was that Mexico, Costa Rica, El Salvador, and Guatemala became competitors of some importance. Venezuela, Ecuador, Colombia, and Peru followed suit. But all these countries put together were unable, despite their best efforts, to shake the supremacy of Brazil. In 1930, the total harvests of Central America and South America, Brazil apart, were only one-sixth of the Brazilian harvest.

During the nineteenth century, new coffee-growing areas came into the running in the Far East. The French began to plant coffee in IndoChina, and the British followed this example in the Straits Settlements. These efforts were attended with varying success. The United States of America, after the Spanish-American war, had its own coffee-plantations in the Philippines.