Figure 1.--This photo was taken in the Cienfuegos, a provincial capital. It is located along Cuba's southern coast in centrl Cuba. It was renamed Cienfuegos after a Captain General. A battle was fought there between American marines who atatempted to sever underwater Spanish communication lines and the Spanish defenders (May 11, 1898). It show a typicl Cubn family at the time. Note the Cuban flag showing support for the revolutionaries in the city. You would have not seen the flag in the city before the arrival of the Americans.

The United States military forces that occupied the island largely ignored the Cuban revolutionaries who had hoped that the United states would recognize them as the legitimte government of an independent Cuba. Brigadier General Fitzhugh Lee, the military govenor of Havana and Piñar del Río reported to military Governor Brooke "Business of all sorts is suspended. Agricultural operations have ceased; large sugar estates with their enormous and expensive machinery are destroyed; houses burned; stock driven off for consumption by the Spanish troops or killed." (September 1899). Cuban Colons (small property owners) were badly in debt. Some had been in debt before the Second War for Independebce (1895-99) and many others contracted debyt as fighing intensified. American Military Governor John R. Brooke pledged resources to assist the Colons (January 1, 1899). This, however, never occurred. There was some thought of annexing Cuba, but there as not popular or political support for such an action. American policy thus became to establish a stable Cuban government. This was complicated by the fact that the Cuban economy, especially the sugar industry was in ruin. And the Colons, badly indebted, did not have access to the capital needed to repair the damage and resume sugar production. American policy at the time was implements through a series of orders issued by the Military Government. We arenot sure just how these orders were prepared and to what extent the War Department and State Department in Washington were involved as opposed to U.S. Army commanders in Cuba. Many of the militry orders concerned Army matters, but some had a substantial impact on the Cuban economy. Military Order #46 (April 1899) established a 2-year moratorium on debt repayment. This provided the Colons, smll-scale farmers and planters with larger holdings thus had a brief period to recover from the damage resulting from the independence struggle. It was, however, not a solution. As the Colons were already indebted they were unable to borrow the substabtial sums needed to but new equioment and resume production. One historian writes, "Direct aid to planters was not part of the United States' design for the postwar reconstruction of Cuba." [Pérez Hispanic] And without such aid, the Cubans themselves were unable to get the economy moving again. External capital was needed. Military Governor Brooke told Cubans hoping for U.S. Government assistabce that "the conclusion was reached that aid could not be given in this direction (October 1899)." Cuban Secretary of Agriculture, Commerce, and Industry Perfecto Lacosta warned that little progress was being made. The precarious situation [of] the great majority of the hacendados and agriculturists of Cuba requires ... ll the possible aid of the State to encourage the reconstruction of the state (June 1900)." [Pérez, Lords, p. 72.] Santa Clara planter Francisco Seigle wrote U.S. Secretary of War Elihu Root, "Our condition is worse today. These properties cannot be made productive without capital (October 3, 1900)." Perfecto Lacosta complained as Military Order #46 was about to expire, "Nothing has been done toward the improvement of our agricultural situation." Military Order #46 expired (April 1901) and little had changed in Cuba. The Colons including the larger planters had not been able to resume production.

Cuban Revolutionaries

The United States military forces that occupied the island largely ignored the Cuban revolutionaries who had hoped that the United States would recognize them as the legitimte government of an independent Cuba. he revolutionaries appear to have wide-spread popular support on the island.

Provisional Government

Economic Situation

American Brigadier General Fitzhugh Lee, the military govenor of Havana and Piñar del Río reported to military Governor Brooke "Business of all sorts is suspended. Agricultural operations have ceased; large sugar estates with their enormous and expensive machinery are destroyed; houses burned; stock driven off for consumption by the Spanish troops or killed." (September 1899). Cuban Colons (small property owners) were badly in debt. Some had been in debt before the Second War for Independebce (1895-99) and many others contracted debt as fighing intensified.

American Policy

American Military Governor John R. Brooke pledged resources to assist the Colons (January 1, 1899). This, however, never occurred. There was some thought of annexing Cuba, but there as not popular or political support for such an action. And the idea of colonies as a result of the territories acquired from Spain was being hotly debated in Washington. There was cionsiderable opposition to an American empire. The outcome was a kind of empire-light compromise. The Philippines would be colony, but Cuba would not. Puerto Rico becamne a Commionwealth. American policy thus became to establish a stable Cuban government. This was complicated by the fact that the Cuban economy, especially the sugar industry was in ruin. And the Colons, badly indebted, did not have access to the capital needed to repair the damage and resume sugar production.

American Investments

American investors took a great interest in Cuba, especially with the U.S. Army providing security. R.B. Hawley organized the Cuban-American Sugar Company (1899). The Company built the Chaparra sugar mill on 70,000 acres of land in Oriente Province. American candy manufacturer Milton Hershey purchased land and built a sugar factory to supply his growing Pennsylvania chocolate enterprise. James H. Post was president of the National Sugar Refining Company of New Jersey and the director of the National City Bank of New York. He took a great interest in Puerto Rico, Cuba, and sugar. He became involed with the American Colonial Bank of Puerto Rico. Healso wasppointe vice president of the Cuban American Sugar Company, which owned several Cuban ugar mills. He held several additional posts aspart of the Cuban sugar industry, including president of the New Niguero Sugar Company, president of the Guantánamo Sugar Company, director of the Chaparra Railroad Company, director of the West India Sugar Finance Corporation (owning 12 sugar mills in the Dominican Republic).

Military Orders

American policy at the time was implements through a series of orders issued by the Military Government. We arenot sure just how these orders were prepared and to what extent the War Department and State Department in Washington were involved as opposed to U.S. Army commanders in Cuba. Many of the militry orders concerned Army matters, but some had a substantial impact on the Cuban economy. Military Governor Brooke's conclusion was that Cuba's future's laid with itsability to organize a stable government with afree market economy. Here he thoughtthe key was in establishing an economy with a functioning banking system. He explained, "When money can be borrowed at a reasonable rate of interest and when capital is willing to invest in the island, a condition of stability will have been reached."

Military Order #46 (April 1899)

Military Order #46 established a 2-year moratorium on debt repayment. This provided the Colons, smll-scale farmers and planters with larger holdings thus had a brief period to recover from the damage resulting from the independence struggle. It was, however, not a solution. As the Colons were already indebted they were unable to borrow the substabtial sums needed to but new equioment and resume production. One historian writes, "Direct aid to planters was not part of the United States' design for the postwar reconstruction of Cuba." [Pérez Hispanic] And without such aid, the Cubans themselves were unable to get the economy moving again. External capital was needed. Military Governor Brooke told Cubans hoping for U.S. Government assistabce that "the conclusion was reached that aid could not be given in this direction (October 1899)." Cuban Secretary of Agriculture, Commerce, and Industry Perfecto Lacosta warned that little progress was being made. The precarious situation [of] the great majority of the hacendados and agriculturists of Cuba requires ... ll the possible aid of the State to encourage the reconstruction of the state (June 1900)." [Pérez, Lords, p. 72.] Santa Clara planter Francisco Seigle wrote U.S. Secretary of War Elihu Root, "Our condition is worse today. These properties cannot be made productive without capital (October 3, 1900)." Perfecto Lacosta complained as Military Order #46 was about to expire, "Nothing has been done toward the improvement of our agricultural situation." Military Order #46 expired (April 1901) and little had changed in Cuba. The Colons including the larger planters had not been able to resume production.

Military Order #139 (May 1901)

Military Order #139 cleared the way for creditors to collect their debts, despite the serious economic circumstances. A Cuban historian idebtifies this as the "... first of a series of calamities to befall planters during the United States occupation, and its effects were not confined to large planters… The war had been especially hard on small farmers. The prospects for indigence and ruin increased considerably with the proclamation of Military Order #139. The fate of the planter class, no less than that of the small independent farmers, was sealed." [Pérez, Hispanic.] As a result, many of the indebted Cuban farmers were forced to sell their lands, often to foreign investors. The forced sale bought down land prices. American investors were attracted by the low land prices, but also by a American military presence prepared to protect their interests. The single most importat American buyer was the United Fruit Company (UFC). After the proclamation, UFC bought some 0.2 million acres in Oriente at $1 per acre. Another Cuban historian in a clasic Markist formulation wrote, "The bank that underwrites the cutting of the cane is foreign, the cutting of the cane is foreign, the consumers' market is foreign, the administrative staff set up in Cuba, the machinery that is installed, the capital that is invested, the very land of Cuba held by foreign ownership… all are foreign, as are, logically enough, the profits that flow out of the country to enrich others." There is no doubt that Americans moved to play a major role in the Cuban sugar industry and the forced sale of land to cover debts seems someting that can fairly be criticized. (It seems very similar to the South after the Civil War. But criticizing American banks for making loans needed to restore the sugar industry or American consumers for buying Cuban sugar is the same kind of dead end Marxist logic that has locked Latin American countries into economic failure.

Foreign Investment and Idelogy

The standard Cuban assessment of the occupation and repeated by many American textbooks is summarized by one historian, "During the U.S. military occupation that began in 1898, U.S. business interests invaded the island, and suddenly Cubans had a new 'master' forcing a one-crop economy. Sales would be to a single market, and that market controlled not only the price of sugar, but also most of the existing sugar cane farms and distribution channels. It suddenly became more difficult for local planters to revitalize their war-damaged businesses." [Sierra] Sierra's sttement fly in the face of bith geograohy abnd history as his own work demonstrates. Sierr's ideological minset is shown by describing American inevestors as 'invaded' the island. Cuban is ideally suite to grow sugar much as Sri Lanka is for tea or Colombia is for coffee. And Cuban became a one crop economy under Spanish rule (19th century). Cuban colons chose at that time to raise sugar because it was the most profitabke crop. Sugar was not forced on Cuba by Americans. Authors like Sierra have the mind set that foreign investors are inherently bad because of the Marrxist belief that the economy is a closed pie. If investors gain, Cubans must suffer. They would prefer foreign aid to foreign investment. The only problem with this outlook is that foreign aid does not work. The region of the world which has received the most foreign aid is Africa and conditions in Africa actually deteriorated after decolonization when that aid arrived. Idealogues can not point to one instance where foreign aid created a modern affluent country. In contrast the number of countries that have moderized through foreign investment is very substantial. The most successful nations in the developing world are those which instead of foreign aid, attracted foreign investment to finance free market ventures (Brazil, China, Chile, Indua, Singapore, South Korea, Taiwan, and other countries). Even in Cuba the simple fact is that the island went from Spanish colonial poverty to one of the most affluent in Latin America (1903-59). Castro ousted the American investors and Communism even with extensive Soviet assistance turned the island back to one of the poorest in the Hemishphere. The obvious relaity that idealogues like Sierra do not like to confront is that foreign investment expands the economic pie and both Cubans and foreign investors benefitted. Along the same line, a leading Cuban historian writes, "The beneficiaries of North American rule, were North Americans." This is further illustrated by the fact that during the second U.S. military intervention in 1906, Military Governor Magoon initiated a program of roads and railroads that was clearly designed to benefit foreign-owned centrales, with expenses of almost $650,000 paid by the Cuban government." [Pérez, Cuba.] Now the question of who benefitted the most is a fair one, but one rarely addressed in an academically honest manner. Rather authors like Pérez cherry pick facts and simply ignore the economic success story of independent Cuba (1903-59).

Sources

Ortiz, Fernando. Trans. Harriet de Onís. Cuban Counterpoint: Tobacco and Sugar (1940). 408p.

Pérez, Louis A. Jr. Cuba: Between Reform and Revolution.

Pérez, Louis A. Jr. Hispanic American Historical Review (1985).

Pérez, Louis A. Jr. Lords of the Mountain: Social Banditry and Peasant Protest in Cuba, 1878-1918

Sierra, J.A. "Bitter memory of Cuban sugar," historyofcuba.com.

Created: 5:25 AM 10/1/2012
Last updated: 11:36 PM 10/5/2012