On the Other Hand: A Reply to Charles Hodges
FIGUERES, JOSE
ON THE OTHER HAND . . . Always eager to encourage debate, we turn the next three pages over to a pair of dissenters. Jos? Figueres, President of Costa Rica, wrote an article in The New Leader last...
...In 1950, he rightly observes, the total of U.S...
...Let us avoid large-scale permanent absentee ownership, which will, in all good faith, drain off a heavy proportion of the wealth produced, and widen the gap between the two Americas...
...Business Abroad," i.e., how American firms can do business in other countries...
...Apparently, I did not express myself clearly enough...
...What will be the social tensions...
...Figueres I should like to comment on Charles Hodges's reply to my article of August 31, 1953, which you entitled "We Don't Want Foreign Investments...
...This capital I correctly figured at a few hundred dollars per worker...
...I shall clarify these points, although I realize how fruitless it is to hold fragmentary discussions on complex issues...
...As objectively as I can, I shall say that, in accordance with old-fashioned "contracts law," the sum of $3.6 million was practically offset by exemptions from customs duties totaling $3 million (during 1952), which would have been paid to the Treasury if the corresponding imports had been made by Costa Rican farmers...
...capital invested in Latin America up to that time amounted to $5 billion...
...My article stated that Costa Rica has land that can be turned into beef production at an additional investment of a few hundred dollars per worker...
...For fifty years—up to 1948—the Company paid no income tax to Costa Rica...
...That is the vital question...
...Investment in the internal economy of the United States is going on at the rate of $30 billion per year...
...They are undoubtedly Costa Rica's best agricultural lands...
...Hodges is impressed by the fact that United Fruit pays a large proportion of the Costa Rican income tax...
...market that are suitable for bananas...
...This, I contend, calls for a "bold new program...
...My article referred to the production of beef by the small Costa Rican farmer as an economic activity in which my country can effect a maximum utilization of natural resources and of existing facilities at a minimum of capital investment...
...To be sure...
...Up to now, we have built two worlds in the Americas, with the United States and Canada on one side and Latin America on the other...
...how will the poor majority feel about the rich minority...
...Policy for Asia," which appeared here on February 22...
...I said that the U.S...
...This problem, with its many phases, is of equal concern to both North and South Americans...
...This is one-fifth of one per cent of the national income for 1950 (roughly $250 billion...
...Professor Hodges himself mentions these figures in his article...
...business evidently conflicts with my plea for world development...
...And if the Company controlled our other major national business—the thousands of small coffee farms on which our social structure and our democracy are based—it would then contribute 100 per cent of our income tax, instead of just a large proportion...
...A Reply to Charles Hodges Latin American Investments By Jos...
...His concern is "The Case for U.S...
...The Company's earnings transferred to the U.S...
...I do not believe it will...
...economy is not dependent, to any appreciable extent, on the earnings coming from a few billions invested abroad...
...Population trends show that the underdeveloped America will have 550 million people at the turn of the century, while the advanced America will have 225 million...
...Those fertile valleys are among the few in the world at a commercial distance from the U.S...
...My preoccupation is with how we can develop the less advanced countries so that international social tensions will diminish...
...It is not my intention to discredit United Fruit or to belittle its merits...
...If we repeat the mistakes of the past, the result will be a multiplication of present difficulties...
...In trying, for example, to inject outside capital into Latin American economies, let us bear in mind the local patterns of development, so that we can build a hemisphere in which peace and democracy will flourish among equals...
...If you can't get enough of controversy, you'll find another one raging in our "Dear Editor" columns, page 21...
...The economists know the figures better than I do...
...Looking to the future, the important issue, to my mind, is this: We of the Americas have to decide whether we want in our hemisphere one or two worlds, one or two stages of civilization, one or two economic standards—which will inevitably determine whether we have one or two cultures...
...Hodges answers that this "will be news to the United Fruit Company...
...Hodges and I are discussing two different matters...
...The Company is allegedly investing $5,000 per laborer in the banana business, which includes Diesel-electric locomotives, high-pressure spraying systems, fast refrigerated ships and modern accounting...
...By all means let us promote local ownership, with as wide a distribution as possible...
...Figueres, President of Costa Rica, wrote an article in The New Leader last summer which provoked Professor Charles Hodges to reply in our issue of January 25...
...Hodges replies that "this will be news to the economists...
...economy (shareholders, reserves and the Government) from the Costa Rican division alone were $18 million, on exports of bananas produced on our soil with a wholesale value estimated at $55 million...
...There are a few points, however, on which Professor Hodges's case for U.S...
...now we present President Figueres's rebuttal...
...Hodges takes issue with my terming "the crumbs" of the banana business that proportion which stays in the Costa Rican Treasury...
...I do not believe it will...
...and, since then, it has been paying 15 per cent of our earnings...
...On them, the toil of 20,000 agricultural wage-earners (equally valueless, I suppose) contributes to the well-being of many a Boston family, and to the maintenance of the huge United Fruit Company empire...
...The revenue received from Latin America by the United States (including individuals, corporations and the Government) was $500 million...
...At present, my Government is negotiating in harmony with the Company, and I myself am preparing a reply to the interesting public letter which they recently addressed to me...
...It seems that Mr...
...how will the inequalities affect hemispheric stability...
...We Costa Ricans cannot but view with affection that part of our country's soil which Professor Hodges coldly calls "valueless coastal lowlands...
...On the next page, radio commentator Bruno Shaw, a veteran of many years in the Far East, takes issue with Chester Bowles's "A U.S...
...He points out that, in 1952 (an exceptionally good year), the United Fruit Company paid $3.6 million in duties and taxes...
...This sentence, which is characteristic of certain business people, sheds light on a great deal of misunderstanding...
Vol. 37 • March 1954 • No. 11
