In the case of quebracho—a very hard wood which is useful for building and constructive purposes, and from which an excellent tannin can be obtained—matters are much the same. Having had experience of the large profits to be derived from the manufacture of quebracho extract, and the splendid dividends paid by the companies engaged in the
work, men or business, anxious to invest their capital to advantage, hastened to acquire forests of quebracho, with the result that the price of such land suddenly rose to a level hitherto undreamed of. Tracts situated in the Chaco—a region where quebracho abounds—which were selling a year previously for £88 the square league of 9648 square miles, rose in price to £880, and this latter price can by no means be considered as a definite maximum.
What is true of lucerne and quebracho is also, though on a much smaller scale, true of linseed or wheat, when after an abundant harvest the land-owner or farmer procures the requisite capital for the purchase of the land he has been cultivating and pays a good price for it. There are here elements which confound all calculations made in advance, and make it difficult to fix even an approximate value on the soil.
At the present moment there is no basis for such a valuation. A farm selling to-day at 20s. per acre, may to-morrow sell for 26s., the day after to-morrow for 32s., and so on, until prices are reached which astonish the first vendor, and give him the melancholy conviction that he did ill to part with his land. For this reason, the best thing one can do to-day is to hold on to the land.
The value of rural and urban property has gone on increasing more and more rapidly for more than forty years; and although there have been great fluctuations in prices, the rise has always been constant in the long run; owing to the increase in the population, the consolidation of political institutions, the construction of far-reaching railway systems, the prodigious development of international traffic, and, as a natural consequence, the great increase of public wealth.
To gain an idea of the entire significance of this increase in values, we must go back to the more than modest prices of rural property which ruled before the later development of the upward movement. It is enough to recall the fact that in 1879, with the object of procuring funds in support of the expedition which General Roca was leading against the Indians of the wilderness, an expedition which resulted in the conquest of 226,800 square miles of territory, the Government offered for sale an enormous tract of land at
the price of £80 the league (about £9 the square mile), the purchase-money to be payable over five years. But the devaluation of these lands was so great, and faith in their remunerative possibilities so inferior, that very few accepted the offer. Many did so rather as a patriotic loan than as a serious investment. Others did so as a mark of personal deference towards the men who were at the head of the Government. But all have been abundantly rewarded, since much of the soil which they were able to obtain at £35 the league is selling to-day at £26,000 and £35,000. More than one of the great private fortunes in the country had no other foundation than this.
This depreciation of rural property continued still unchanged for a dozen years; so much so, that in order to tide over the crisis before the crash of 1890, the Government, which so disastrously handled the affairs of the nation, had the evil inspiration to offer for sale in Europe, by virtue of the law of October the 15th, 1889, those very 24,000 leagues of land obtained by conquest by General Roca’s expedition. The sale was to be effected at the figure of 10 francs per hectare—about 3s. 3d. per acre!—payable half upon purchase and half at the end of two years. No limit was set to the powers of purchase of any one buyer; each could buy just as much as his purse would allow. The law, in palliation of this incredible operation,[60] promised to apply the whole product of the sales to the fund for converting the issue of the guaranteed bank-notes of famous memory. Providence, happily, which more than once has taken the Argentine under its especial protection, prevented this disastrous alienation of territory from taking place. Had it been otherwise, the Republic would have sold for a mess of pottage a magnificent portion of her territory, a country large enough to house more than one European nation, and which to-day perhaps would be in the hands of a company or a foreign government—a new state within the State.
[60] It must be remembered that this tract was four and a half times the size of England!—and this enormous country, in the heart of the Argentine, was offered for sale to foreigners! The process of buying it back when the terrible folly of the act was once obvious, would have been equivalent to making the country tributary for years, and for enormous sums, to Europe.—[Trans.]
The depreciation of rural property continued for some