Chile to-day is spending $400,000,000 on harbor improvements and fortifications, most of the work being in the hands of Europeans. The plans contemplated will require many years to complete, and during all this time European material will be used and workmen from the Old World will derive profit from the undertaking.
An American first had the concession to build the subway in Buenos Aires. He spent months trying to get capital in the United States without success. Finally a German raised the money in Hamburg and now everything about the line from the electrical installation to the motorman and his uniform is “Made in Germany.” Being the first and only underground road in Latin America it was written about and talked of everywhere, and at all times the Germans got credit for the enterprise and were well advertised as efficient and wonderful engineers. This was another opportunity lost to us.
Before the European War started a syndicate of English, French and Germans had agreed to expend $200,000,000 in Colombia building railways and in making the Magdalena River, the only highway to the capital at Bogota, navigable at all seasons of the year. Due to present hostilities they had to abandon the project. The terms offered by Colombia were excellent, including 5 per cent. interest on the capital and the further provision that the government would ultimately within a specified period take over the road, paying an exceptional profit to the original investors. Here is an excellent opportunity for American capital to develop a reciprocal market.
One of the chief reasons for the scarcity of invested American capital in Latin America is the indefinite and indifferent attitude of our State Department in failing to protect its citizens abroad or in seeking redress for injuries done individuals or business conducted in these countries.
No race of men are as enterprising or venturesome or more truly pioneers in every sense of the word than we Americans. This trait is a natural inheritance from our forefathers, who left comparatively civilized and comfortable Europe to gain a livelihood in the wilds of unknown and unexplored America. We are a practical people, also, and when through years of trying experiences we became definitely impressed with the fact that in our foreign ventures we had neither the co-operation nor the protection of our government, very naturally we abandoned these tempting fields of business and allowed them to be profitably tilled by the citizens of European governments which sympathized with their subjects in their efforts to develop trade and at the same time provided them adequate protection of a substantial and impressive type.
In the early days which marked the European campaign for the commercial supremacy of Latin America, most of these countries were the scenes of much bloodshed and the violence of devastating revolutions. As a result of the instability of their governments, there was positively little or no security of life or property. Concessions solemnly made were ruthlessly cancelled. Business ventures involving the outlay of immense patience and large capital were completely wiped out. In brief the foreigner in these lands was looked upon as an intruder and treated with scant consideration. When Americans were involved in such occurrences, our State Department, with very few exceptions, ignored the petitions of the victims, until its neglect in this regard became so notorious that finally no promoter had the temerity to seek capital in this country for any Latin American enterprise. This condition of affairs had much to do with turning the current of these ventures toward European money markets, an opportunity eagerly accepted by all parties.
On the other hand, the European, whether prospecting in the snow-topped mountains or uplands of Bolivia, or in the jungles of the Amazon, knew that his government kept a watchful eye on him and encouraged his every effort, first because this was the privilege and duty of a government and secondly the success of the individual in these lands ultimately meant prosperity for the nation. If he was robbed, imprisoned or murdered, if the result of his years of labor was destroyed in national or local uprisings, the warship would always materialize to emphasize the collection of compensation when diplomacy failed.
Such consideration for their people on the part of the European governments duly impressed the Latin American mind, and more so especially when he was heavily taxed to reimburse the foreigner for injuries received. As a result the European became respected more and more from Mexico to Patagonia, and was allowed to pursue his way in comparative peace, the converse of this proposition being true of the unfortunate American, who could not expect governmental protection and who became the object of much abuse and ridicule in these lands. The truth of these statements is so obvious that it is unnecessary for me to cite any illustrations in support of them.
Socially speaking all of Latin America may be divided into two general classes, the politician and the business man. As a rule the “politico” has been the cause of all the unrest and upheavals these countries have experienced, while the advance and progress of these nations is due to the “commerciante”—the man who uses his brain and invests his money in its various ventures. The larger progressive enterprises in Spanish America—the building of railroads, the developing of mines, exporting, importing, in brief, commerce as a whole—is chiefly carried on by foreigners, aided by a few ambitious, practical, far-seeing, native business men, never the politician. Commerce is a great civilizing agency. The higher in the scale of civilization a people are, the more secure will trade relations with them be. The larger and more important countries of Latin America have at last begun to realize that internal peace means prosperity, that prosperity attracts, yes invites capital, even from the timid and those whose government does not stand behind them in a dignified manner.
As a consequence, despite the unfavorable attitude of the United States State Department toward foreign investment, and with the idea of showing our Latin American friends that we are sincerely interested in establishing our trade relations with them on a reciprocal basis, American capital in large sums is beginning to find its way into this hitherto, for us, closed market. Panama has just been loaned $3,000,000 American money to be used in the construction of railways and roads, thereby bringing the producer nearer to the markets and the shipping points of the country. Within five years I venture to predict that as a result of this investment, our trade with Panama will have materially increased, owing to the fact that agricultural products heretofore prevented from reaching the consumer will be able to do so with comparative ease, especially in the case of tropical fruits, cocoanuts, copra and sugar.