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Businessmen and Politics in the Process of Economic Development: Argentina and Canada*

Published online by Cambridge University Press:  10 November 2009

Judith Teichman
Judith Teichman
Affiliation:
University of Waterloo
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Type
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Information
Canadian Journal of Political Science/Revue canadienne de science politique , Volume 15 , Issue 1 , March 1982 , pp. 47 - 66
Copyright
Copyright © Canadian Political Science Association (l' Association canadienne de science politique) and/et la Société québécoise de science politique 1982

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References

1 In taking this approach, my analysis differs from Alexander's, Malcolm (“The Political Economy of Semi-Industrial Capitalism: A Comparative Study of Argentina, Australia and Canada, 1950–1970” [unpublished doctoral dissertation, McGill University, 1979]). He takes the early 1950s as the point at which these semi-peripheral countries began to diverge. Alexander's study glosses over important differences in the early economic histories of Canada and Argentina which, as I shall argue in this article, patterned subsequent events. Alexander's concern was, however, different from mine here. His primary task was, in his own words, “the delineation of the common experiences of these semi-industrial nations in the world economy of post World War II era” (64), while their divergences were for him “a secondary question” (65).Google Scholar

2 Ferns, H. S., Britain and Argentina in the Nineteenth Century (Great Britain: Oxford University Press, 1960), 133.Google Scholar

3 Ibid., 362.

4 On this see, Fuchs, Jaime, Argentina, Su Desarrollo Capitalista (Buenos Aires: Editorial Cartego, 1955), 171Google Scholar, and Panaia, Marta et al., Estudios Sobre los Origenes del Peronismo, Vol. 2 (Buenos Aires: Siglo XXI Editores S.A., 1973), 6.Google Scholar

5 Between 1910 and 1943, over one-half of the presidents were ranchers and members of the Rural Society, while 40 percent of the cabinet appointments went to members of the Society. It controlled the most important ministries: Agriculture, Foreign Relations, Finance and the most important military posts (Smith, Peter, Politics and Beef in Argentina [New York: Columbia University Press, 1969], 46).Google Scholar

6 Crossley, Colin and Greenhill, Robert, “The River Plate Beef Trade,” in Plan, D. C. M. (ed.), Business Imperialism 1840–1930 (Oxford: Clarendon Press, 1977), 308.Google Scholar

7 Smith, Peter, Politics and Beef in Argentina, 23.Google Scholar

8 , Crossley and , Hill, “The River Plate Beef Trade,” 306.Google Scholar

9 , Fuchs, Argentina, Su Desarrollo Capitalista, 141, 151Google Scholar; Alejandro, Diaz, Essays on the Economic History of the Argentine Republic (New Haven: Yale University Press, 1970), 461.Google Scholar

10 Panaia, Marta et al., Estudios Sobre los Origenes del Peronismo, and Fuchs, Jaime, Argentina, Su Desarrollo Capitalista, 170.Google Scholar

11 Easterbrook, W. T. and Aitken, Hugh G. J., Canadian Economic History (Toronto: Macmillan, 1956), 163.Google Scholar

12 Naylor, Tom, The History of Canadian Business, 1867–1914, Vol. 1 (Toronto: Lorimer, 1975), 69.Google Scholar

13 Williams, Glen, “The National Policy Tariffs: Industrial Underdevelopment through Import Substitution,” this JOURNAL 2 (1979), 357.Google Scholar

14 While in 1875 Britain supplied 50.6 percent of Canada's imports, by 1915 this figure had dropped to 16.4 per cent (calculated from Skelton, O. D., “General Economic History, 1867–1912,” in Shortt, Adam and Doughtly, Arthur G. [eds.], Canada and Its Provinces, Vol. 9 [Toronto: Glasgow Brook and Co., 1914], 141Google Scholar and Urquhart, M. C. and Buckley, K. A. H. [eds.], Historical Statistics of Canada [Toronto: Macmillan, 1965], 183)Google Scholar. On the other hand, between 1879 and 1895, Britain's share of Argentine imports jumped from 27.5 percent to 41.7 percent, dropping to 31.0 percent by 1910 (calculated from Fuchs, Argentina, Su Desarrollo Capitalista, 141, 151, and Alejandro, , Essays on the Economic History of the Argentina Republic, 461).Google Scholar

15 Ferns, , Britain and Argentina in the Nineteenth Century, 77Google Scholar; Carretero, Andres, Orίgenes de la Dependencia Economica Argentina (Buenos Aires: Libreria y Editorial Platero S.R.L., 1974), 80.Google Scholar

16 Burgin, Miron, Aspectos Económicos del Federalismo Argentino (Buenos Aires: Libreria Hachette S.A., 1960), 148.Google Scholar

17 Ibid., 144. Chiaramonte, Jose Carlos(Nacionalismo y Liberalismo Económicos en Argentina, 1860–1880 [Buenos Aires: Solar Hachette, 1971]) maintains that insufficient capital was in part responsible for the failure of a fabric firm and a meat packing plant set up by the Rural Society.Google Scholar

18 Ibid., 99.

19 Chiaramonte estimates that during a good five year period a profit of 57.6 per cent annually could be made on 29,410 head of sheep. Ibid., 243.

20 Here my analysis differs from Alexander's which argues that the Canadian elite's interests were less linked to the export sector than was the case for the Argentine elite (Alexander, , “The Political Economy of Semi-Industrial Capitalism,” 122). Although I would agree with Alexander that the sectoral identification of the Argentine elite was certainly more marked, both politically dominant groups were closely dependent upon the export of staples.Google Scholar

21 Carretero, , Orίgenes de la Dependencia Económica Argentina, 100.Google Scholar

22 Burgin, , Aspectos Económicos del Federalismo Argentino, 280.Google Scholar

23 This is one of the fundamentally important differences in early Canadian and Argentine economic development not dealt with in Alexander's comparative analysis. As shall be discussed later, Argentina's later and different pattern of import substitution produced discontinuities and political forces which did not arise in the Canadian case.

24 Easterbrook, and , Aitken, Canadian Economic History, 380Google Scholar; Firestone, O. J., Canada's Economic Development, 1857–1953 (London: Bowes and Bowes, 1958), 154Google Scholar; Clark, S. D., The Canadian Manufacturers' Association (Toronto: University of Toronto Press, 1939), 9.Google Scholar

25 Epp, Abram E., “Co-operation Among Capitalists, The Canadian Merger Movement” (unpublished doctoral dissertation, The Johns Hopkins University, 1973), 144.Google Scholar

26 , Bertram, “Economic Growth in Canadian History, 1870–1915,” 82.Google Scholar

27 Urquhart, and Buckley, (eds.), Historical Statistics of Canada, 463.Google Scholar

28 Marshall, Herbert, et al., Canadian-American Industry (New York: Russell and Russell, 1970), 14, 201.Google Scholar

29 Naylor, , The History of Canadian Business, 1867–1914, Vol. 2, 187.Google Scholar

30 Urquhart, and Buckley, (eds.). Historical Statistics of Canada, 463.Google Scholar

31 Naylor, , The History of Canadian Business, 1867–1914, Vol. 1, 38.Google Scholar

32 Jorge, Eduardo F., Industria y Concentration Económica (Buenos Aires: Siglo XXI Argentina Editores, S.A., 1971), 54.Google Scholar

33 Ferrer, , The Argentina Economy, 98Google Scholar; Dorfman, Adolfo, Historia de la Industria Argentina (Buenos Aires: Ediciones Solar S.A. and Libreria Hachette S.A., 1970), 213Google Scholar; Fuchs, , Argentina, Su Desarrollo Capitalista, 121. Industrialization was proceeding during the period in the presence of some policies conducive to its expansion.Google Scholar

34 Easterbrook, and , Aitken, Canadian Economic History, 485.Google Scholar

35 Wilkins, Mira, The Maturing of Multinational Enterprises: American Business Abroad from 1914 to 1970 (Cambridge, Massachusetts: Harvard University Press, 1975), 311.Google Scholar

36 Calculated from Urquhart, and Buckley, (eds.), Historical Statistics of Canada, 173Google Scholar, and Alejandro, , Essays on the Economic History of the Argentine Republic, 475–76.Google Scholar

37 By 1935, the value added by Argentine manufacturing had surpassed its 1929 level. In the case of Canada, the value added by manufacturing did not regain its 1929 level until after 1940 (calculated from Urquhart, and Buckley, [eds.], Historical Statistics of Canada, 141Google Scholar, and Alejandro, , Essays on the Economic History of the Argentine Republic, 419–20).Google Scholar

38 Telia, Guido di and Zymelman, Manuel, Las Etapas del Desarrollo Económico Argentina (Buenos Aires: Editorial Universitaria de Buenos Aires, 1967), 393.Google Scholar

39 Between 1921 and 1936, the value of Argentine exports to both the United States and Great Britain declined in absolute terms. The United States took measures to keep out Argentine agro-livestock products which would compete with its own. Whereas between 1941 and 1951 Argentine exports to America slightly more than doubled in value, Canadian exports to the United States nearly quadrupled during the same period. Calculated from Urquhart, and Buckley, (eds.), Historical Statistics of Canada, and Alejandro, , Essays on the Economic History of the Argentine Republic, 475–76.Google Scholar

40 The landed elite appears to have given no consideration to the diversification of production or investment at this time. The Rural Society remained intensely committed to beef production as the economic activity best suited to Argentina. The persistence of old values in the face of altered circumstances has been explained by the continued socialization of new members in the old attitudes of the organization (Stinchombe, Arthur L., “Social Structure and Organizations,” in March, James G. [ed.], Handbook of Organizations [Chicago: Rand McNally and Co., 1956]).Google Scholar

41 Argentine exports, however, never recovered their pre-1930 levels. Fuchs, , Argentina, Su Desarrollo Capitalista, 272.Google Scholar

42 Telia, di and Zymelman, , Las Etapas del Desarrollo Económico Argentino, 235Google Scholar; Jorge, , Industria y Concentration Económica, 50, 176–77, 190–91Google Scholar; Ramos, Monica Peralta, Etapas de Acumulación y Alianzas de Closes en la Argentina, 1930–1970 (Buenos Aires: Siglo XXI Argentina Editores, 1972), 84. Between 1935 and 1946 the number of manufacturing establishments rose from 45,000 to over 85,000 (Censes Industrials, 1935 and 1946).Google Scholar

43 Urquhart, and Buckley, (eds.), Historical Statistics of Canada, 181.Google Scholar

44 After the Depression, a growing set of norms tended to inhibit the direct representation of the economic elite in the state (Clement, Wallace, The Canadian Corporate Elite [Toronto: McClelland and Stewart, 1975], 85–87).Google Scholar

45 Carr, D. W., Recovering Canada's Nationhood (Toronto: Canada Publishing Company, 1971), 52.Google Scholar

46 Wallace Clement points to the presence of direct interlocks (as opposed to subsidiary interlocks) as evidence of the presence of a continental elite. He maintains that a segment of the Canadian capitalist class has been drawn into the inner circle of the American elite (Continental Corporate Power [Toronto: McClelland and Stewart, 1977], 179Google Scholar). Jorge Niosi, on the other hand, argues that it is impossible to match directorates with actual corporate ownership and that economically and socially the Canadian and American bourgeoisie do not mingle (Nisoi, , The Canadian Economy [Montreal: Back Rose Ltd., 1978], 169).Google Scholar

47 Clement, , Continental Corporate Power, 54.Google Scholar

48 See for example, Alejandro, , Essays on the Economic History of the Argentine Republic, 76Google Scholar; Ferrer, , The Argentine Economy, 200.Google Scholar

49 Jorge Foder, “Penón's Policies for Agricultural Exports 1946–48: Dogmatism or Commonsense,” in Rock, David (ed.), Argentina in the Twentieth Century (London: Duckworth, 1975)Google Scholar; Alexander, , “The Political Economy of Semi-Industrial Capitalism,” 176–77.Google Scholar

50 Alejandro, , Essays on the Economic History of the Argentine Republic, 76.Google Scholar

51 Rennie, S., The Argentine Republic (New York: Macmillan, 1945), 325. An examination of the composition of British imports into Argentina from 1850 on shows the increasing importance of metal products and the decreasing importance of textile products.Google Scholar

52 Alejandro, , Essays on the Economic History of the Argentine Republic, 99.Google Scholar

53 On the misallocation of resources within the industrial sector during the Peronist period, see H. Schwartz, “The Argentine Experience with Industrial Credit and Protection Incentives, 1943–1958” (unpublished doctoral dissertation, Yale University, 1967), 152 ff. Schwartz argues that the Peron regime failed to exercise any selectivity in deciding what industrial activities to protect. My own research has suggested that political considerations were paramount in the determination of which industrial sectors received favourable treatment (see Judith Teichman, “Industrial Trade Associations in Argentine Politics” [unpublished doctoral dissertation, University of Toronto, 1978]).

54 On the support of these new, light industrialists for Peron, see Teichman, Judith, “Interest Conflict and Entrepreneurial Support for Perón,” Latin American Research Review 16 (1981), 144–55.Google Scholar

55 The conventional wisdom of Argentine scholarship maintains that these social groups continued to have an important impact on economic policy after the fall of Peron, playing an important role in the sharp oscillations in economic policy which occurred during the period between 1955 and 1976. Alexander's argument that instability in economic policy during the period finds its roots in sectoral conflict within the dominant elite challenges this accepted notion (Alexander, “The Political Economy of Semi-Industrial Capitalism,” 240). My own findings have confirmed the former viewpoint. On this see Niosi, Jorge, Los Empresarios y el Eslado Argentina (1955–1969) (Buenos Aires: Siglo XXI Editores S.A., 1974)Google Scholar; O'Donnell, Guillermo, “Estado y Alianzas en la Argentina 1956–1976” in Desarrollo Económico 16 (Enero-Marzo, 1977); Teichman, “Industrial Trade Associations in Argentine Politics.” While a full discussion of the relationship between the state and society in Argentina and Canada is beyond the scope of this essay, Alexander's notion of the greater permeability of the Argentine state in the postwar period appears to be well taken (“The Political Economy of Semi-Industrial Capitalism,” 260).Google Scholar

56 The Argentine meat producers, on the other hand, often felt squeezed by foreign interests. Not only did foreign meat packing plants determine livestock prices, but British banks (the most successful and most stable in Argentina) were reluctant to lend to landowners (Jones, Charles “Commercial Banks and Mortgage Companies” in Platt, [ed.], Business Imperialism, 1840–1930, 37).Google Scholar

57 Cardoso suggests that when the labour movement is sufficiently strong, a weak business faction may consider it as a possible short-term ally against other, more powerful business interests. This appears to be what happened in Argentina during the Peron period (Cardoso, Fernando H., Ideoίogias de la Burguesίa Industrial en Sociedades Dependientes [Buenos Aires: Siglo XXI Editores, S.A., 1972], 179).Google Scholar