Trade and Friendship with Latin America


By DAVID E. GRANT, Foreign Counsel, Pan American Airways System

Delivered at the Fourteenth Boston Conference on Distribution, October 5, 1942

Vital Speeches of the Day, Vol. IX, pp. 147-150.

TO those acquainted with the inter-American field an attempt to cover so important a subject as Trade and Friendship in the space of a twenty-minute address may well appear nothing short of temerity. When we consider that there are involved twenty-one nations (twenty-two including Canada) comprising a whole hemisphere; that among these nations there are enormous differences in topography, climate, industry, race and culture; that the population of Latin America, roughly equal to that of the United States, has, until recently, been remote and apart from us and our national development, it is obvious that one can hopemerely to touch a few high spots, in the most general terms, leaving statistics and references to the flood of literature on the subject now streaming from our public and private presses.

I believe we are all fully persuaded by this time of the vital importance to the American continent and to the world, of Western Hemisphere solidarity. Not only must our new world attain harmony and economic sufficiency unto itself, but we must prepare to reconstruct the old world, physically, economically and spiritually. As a matter of fact, after the present world-wide cataclysm, if democracy prevails, ourswill become the old world, Europe and Asia the new. Working closely as a unit, we shall have to restore what once was our heritage, a free flow of world trade, a respect for the sanctity of treaties, an eternal striving for the blessings of peace in a well-ordered international society, and above all a restoration of the dignity and the basic rights of the human individual.

In the matter of trade, and for the material progress of their own citizens as well as all of the Americas, the Latin American countries offer today the most promising field for immediate development in the whole world. Limitless and still unfathomed are their natural resources. I think it may be safe to assert that practically every product of the earth, of utility to mankind, could, with appropriate preparation, be duplicated in Latin America, even to the exotic spices and the rare drugs which hitherto have been the riches of the East Indies and the South Seas. Again, by far the great part of South America is ripe now for the apparently unending rise in the standard of living which has characterized the United States in the last fifty years. With a happier economic destiny, the people of our sister nations, will learn, as did our own, to desire and to utilize the thousand and one machines and devices which we in America have come to consider indispensable to a better life. To the manufacture of these comforts they will contribute by the furnishing of raw materials from their own lands, and, in this sense, the inter-American market will be self-perpetuating and self-replenishing. As standards of living rise, there will be more demand by Latin America for the conveniences of living and consequently more demand by the United States for raw materials, which, in turn, will mean more money in Latin America, the cycle developing steadily into more volume for inter-American commerce. It has worked that way in our own country. Contrary to predictions and misgivings, we had never experienced, up to the outbreak of the present world war, any saturation of the domestic market for the conveniences of living. Apparently the more automobiles we put out, the greater the demand for automobiles, and so it has been with radios, refrigerators, cameras, household appliances and even food and clothing.

Over this vast and fertile field for inter-American prosperity, a close community of history, tradition and ideals, hovers like summer clouds and sunshine, ready to work its miracle of abundant growth. Due to those common ties and pure traditions there never has been a single fortified frontier from Hudson Bay to the Straits of Magellan; never a conflict stemming from ancient hates, unrequited greeds or yearnings for revenge. Every one of our Americas began as a colony of a powerful European monarchy; each became a victim of the avarice and exploitation of short-sighted politicians in the mother country; to each befell a bitter struggle for freedom and independence, with its appalling cost in blood and treasure. All of them were then and are now, animated by the spirit of democracy and the ideals of liberty. These common traditions and aspirations transcend temperament. On them we can build, as on a bed-rock foundation, an integrated and harmonious hemisphere, offering the peace and prosperity, the freedom and opportunity which have been the watchwords of our American way of life.

To the great cause of Inter-American Trade and Friendship, our own government and virtually all of our sister republics are now earnestly dedicated. But the road has its our many differences of race, economic status, culture and obstacles, and some are indeed formidable. In the economic field perhaps the most stubborn is that of over abundant and competitive products. All of us are more or less familiar with the controversy which for years has embitteredour relations with Argentina, over the importation of Argentine beef-products. The cattle-raising interests of the United States have spared no effort in their battle against this potential competition. The Argentinians claim that we have even resorted to baseless slander by ascribing generally to Argentine cattle, diseases which prevail only in isolated districts of the republic. So powerful has been the influence of short-sighted and selfish interests in our country that until the stress of current events, there never has been a bona-fide attempt to solve or to compromise this problem, to the mutual advantage of both countries. It has been allowed to fester and ferment entirely too long.

The single-crop or single-product economies of a good number of our southern neighbors have been another weakness in the inter-American structure. Sugar specialization brought disaster to Cuba for over a decade following 1921 and it is still a great drag on Cuban economy. Brazil with her coffee has had similar experience. Bananas have too long been the arbiters of the economic destinies of two or three countries of Central America. In the long run tin mining specialization has not been too good for Bolivia, nor nitrate fields excessively healthy for Chile. Slowly and intelligently diversification must be introduced and developed to free our neighbors from the dangers of specialization and the United States, with its agricultural missions to Latin America, is doing much to assist her neighbors in forging the tools for their liberation.

Inadequate transportation is another very important obstacle to a wide distribution and exchange of goods. Although in normal times the coastal areas of Latin America have enjoyed good maritime transport facilities, the interior of a great number of these nations is still dependent on primitive facilities. Slow and cumbersome river traffic is still the trade artery of interior Colombia, Venezuela, Brazil, Uruguay and Paraguay. The mountainous terrain of Central America looks to the ox cart for the sustenance of its commerce, while in the highlands of northern and western South America, the mule and the llama slowly and meagrely move the products of the country. True it is that air transport has worked wonders in the last decade. Today the volume and the nature of the freight carried on wings over the vast flatlands and the towering mountain ranges of Latin America is astounding. Not merely a world of light merchandise, but lately even heavy machinery forms a part of air cargo. But the fact remains that bulk merchandise such as the products of agriculture and forest industries must, for years to come, move by surface vehicles. A comprehensive highway system is the task ahead for the Southern Americas, the Pan American highway is its beginning.

Then we have also the artificial barriers to the progress of inter-American commerce. Our State Department under the able administration of the Honorable Cordell Hull, has sought earnestly to eliminate these through a series of reciprocal trade agreements. Blocked currencies, exchange controls, arbitrary and protectionist tariffs, onerous export and import regulations have all served to obstruct, to discourage and to stifle our western commerce. True, many of these measures have been laid to war conditions; but the vice behind them is the selfish nationalism they reflect. They must be resolved some day by concerted action among all of the American nations, for the good of all; they must cease to be cultivated under the philosophy of each for himself and devil take the hindmost.

Not a few of our difficulties in the past can be ascribed to our own North-American inexperience and inflexibility. United States business only "discovered" Latin America during the first World War and then solely because Latin America clamored to be discovered. Cut off from its supplyof European goods, it turned to us beginning in 1914, to supply its needs. We had been too busy up to that time with our own domestic market and with our European and Asiatic trade, to take Latin America very seriously. While we were working at the front and the sides of our economic door-step the Germans and the British had been firmly entrenching themselves in the back yard. That the Germans especially did an excellent job is manifested from the fact we have not succeeded in ousting them even today.

When Latin America first turned to us for a business association, even the finest of our business families were profoundly and smugly ignorant of her ways and her peoples. I wish time permitted of citing to you some instances of how amazing our provincialism actually was. Being totally uninformed as to the psychology, the culture and the traditions of our southern neighbors, our first error,—and a grievous one it was,—consisted of sending to them the wrong type of representatives. The "go-getter" American salesman, the high-pressure bunkum artist, who knows nothing, thinks nothing, talks nothing beyond his sample case and his order book, was the worst possible detriment to inter-American trade and friendship. He was immediately stamped by the Latin American as a crass materialist, an ignoramus and an upstart. Unfortunately, this estimate was not confined to him, but was applied, in a natural way, to all North Americans, since specimens of other and better types, did not visit Latin America in the early days.

A further blunder has been our aggressive tendency to reform Latin American business rather than to accommodate it. The Germans were far too wise for that; even to the smallest of items their policy has been to cater to the local merchants' usages and whims. Even today a salesman who urges upon a merchant in a small town of Colombia that mustache-cups are museum pieces in the United States, wherefore he should order the latest New York hotel models, neither sells his goods nor makes friends. He ends by offending his prospect and throwing one more rock onto the road to inter-American understanding. The Latin American market does not want to be reformed. It is disposed to develop slowly and steadily, as we did, but not to be pushed. It asks for service, not advice. Its merchants are wise in the ways of their people. They know their growth comes from the bottom up and not from the top down.

As a last important factor, our North American credit methods have never become adjusted to Latin America. Two per cent in ten days, thirty days net, is an irritating jest south of the Rio Grande. Long term credits are not only the natural conditions of trade in countries of agricultural economy and primitive transport, but our European competitors have thoroughly nurtured them for long years. In cooperation with other American governments our own authorities at Washington are intensively working on these credit problems, and there is good reason to believe they can, and will shortly be, satisfactorily resolved.

Beyond and above trade, in the realm of sincere and lasting friendship with Latin America, on the road to a mutual understanding free of envy, distrust and intolerance, we find also formidable barriers which must be slowly and patiently levelled away. Perhaps the greatest of these is the difference in cultural background. There is not much in common between Hispanic and Anglo-Saxon antecedents. On the contrary, they imply basic differences in race, in language and in philosophy of life. Until yesterday our Latin American neighbors looked to Spain and France for their arts, their literature, and their law; to England for their engineering, to Germany for their pure science and to us merely for industrial progress. To effect a real and comprehensive approach, we North Americans must revolutionize our outlook and our provincial habits in respect of foreign languages, foreign cultures and foreign temperaments. The Latin Americans must revolutionize their concepts of us and of our ideals, based, for the main part, on distorted movie characterizations, sensational news items, and over-played materialistic achievements. Notwithstanding the glib optimism of inexperienced people, and the enthusiasm now sweeping our country for things and persons Latin American, the objective of a thorough and permanent approach, the basis of a sincere and deep friendship will not be easy to attain, nor will it come overnight. There is much painstakingly to learn and unlearn both north and south of the Rio Grande.

In the first place, we must make up our minds that real friendship is based on our acceptance of other people as equals. A false sense of superiority based purely on material progress, on wealth and upon an outstanding industrial organization, must give way to the recognition of a maturer Latin American culture and a profounder wisdom in the art of living. We must realize that although we can teach our neighbors how to live more easily, they can teach us to live more fully. It must become with us a "give and take" proposition, whereby we are to get as much as we give. And this spirit must permeate all of our contacts, thoroughly and sincerely.

Too often we delude ourselves by thinking that the Latin Americans are the idealists and that we are the realists. As a matter of fact, it is quite the other way around. It is the North Americans who are carried away by slogans, high-sounding phrases and empty formulae. The Latin-Americans, though they like such things too, think behind them and face the facts. No torrent of banquets, receptions, testimonials and medals will quite sweep them off their feet. They have a knack of evaluating such gestures in the light of deeds and actions. For the first time in decades, the Good Neighbor Policy has brought in its train proper deeds as well as kind words. Our friends from the South are on the way to meeting us as equals and as comrades. Caution and suspicion still lurk in dark corners, for a few years cannot obliterate the record of half a century; but we are getting a fair hearing, and if we sustain our course for a generation or two, our children and our grandchildren may enjoy in full the ideals and the benefits of an inter-American family circle.

Much indeed is being done under the leadership of our Government by civic, professional and educational organizations, even down to our primary schools. The Latin American countries are responding in kind. With adults of mature years both in the North and the South, the best we can hope to develop is a knowledge and an appreciation of each other's literature, history and temperament. Although with them it is late to hope for a profound friendship, we can at least foster a spirit of mutual respect and tolerance.

Our hope is in our youth. We cannot begin too early with our children. The whole of our education in the United States should be recast to the Inter-American point of view in history, geography, language and culture. American education should actually be American and not North American. In this respect the Latin Americans are ahead of us. Their youth are fast learning our language, know much of our history, are familiar with the great figures of our literature and can shame us all in the matter of geography. They are far ahead of us too in the matter of tolerance for they have been intermingling for generations with many racial stocks from Europe and the Orient. All children are naturally free of racial prejudices and bigotries. They acquire these from their elders. It must be our duty to see to it that their native and God-given spirit of tolerance remains untainted even by their own parents.

The American nations have it in their power to recast the world. Already they have given it an object lesson on the feasibility of a community of nations working out its problems in harmony, for the best interests of all. For over a half century, without binding treaties, they have been associated into a closely knit federation through the agency of the Pan American Union. It has served as an Inter-American council in respect of economic, cultural and even political problems common to the twenty-one American Republics, and as a clearing house of information valuable to the progress of all. In the light of past association and experience it should not be difficult to implement this international community by perhaps a super-constitution, an Inter-American Bill of Rights and an Inter-American Tribunal of Justice, with agencies to execute its decrees. During the years, perhaps as long as two generations, in which the European world may have to reconstruct its life and cool its passions in preparation of a rule by law instead of by men, our own Western Hemisphere may well serve as the laboratory of a world structure, teaching by its experience and preaching by its example. In such a structure there are no firmer pillars than trade and friendship, both of which are engaging our attention today as never before in our Inter-Americanhistory. There is no reason why whatever success we attain with that program in our western hemisphere, cannot serve the world at large, once the rancors and the hatreds and the perversions of moral law have been cleansed from its European and Asiatic atmospheres.

This paper of necessity cannot go into ways and means. These would imply not only unlimited time, but wisdom and ability far beyond that of any individual. It can be merely a plea to those working for the cause of Inter-American solidarity. There are great problems, but the objective is attainable. Indeed, we have already come a good way on the long road. Government and Commerce are both dedicated now to the superior value of friendship. Business has realized that although necessity opens new accounts, only confidence and understanding will hold them. In this new consciousness, it will expand its trade with vision and a sense of responsibility. Distribute your goods, and all the more power to you; but in their distribution make friends. Prepare your young men for executive positions, but prepare them also to take their places as Americans among their fellows of the Hemisphere. It may be in the cards of destiny that the new world shall now come of age, perhaps to help and guide the old to the eventual brotherhood of man.