CENTRAL AMERICAN POLITICS AND ECONOMY 265
Despite the offi cial bias in favor of agriculture,
industry continued to grow. By 1908, Brazil could
boast of more than three thousand industrial enter-
prises. Foreign fi rms dominated the fi elds of bank-
ing, public works, utilities, transportation, and the
export and import trade. Manufacturing, on the
other hand, was carried on almost exclusively by
native Brazilians and permanent immigrants. This
national industry was concentrated in the four
states of São Paulo, Minas Gervais, Rio de Janeiro,
and Rio Grande do Sul. Heavy industry did not ex-
ist; over half of the enterprises were textile mills
and food-processing plants. Many of these “enter-
prises” were small workshops that employed only a
few artisans or operated with archaic technology,
and Brazilians in the market economy continued
to import most quality products. The quantita-
tive and qualitative development of industry was
hampered by the semifeudal conditions prevailing
in the countryside; by the extreme poverty of the
masses, which sharply limited the internal market;
by the lack of a skilled, literate labor force; and by
the hostility of most fazendeiros and foreign inter-
ests to industry.
Together with industry there arose a working
class destined to play a signifi cant role in the life
of the country. The Brazilian proletariat was partly
recruited from sharecroppers and minifundio peas-
ants fl eeing to the cities to escape dismal poverty
and the tyranny of coronéis, but above all it was
composed of the fl ood of European immigrants,
who arrived at a rate of 100,000 to 150,000 each
year. Working and living conditions of the work-
ing class were often intolerable. Child labor was
common, for children could be legally employed
from the age of twelve. The workday ranged from
nine hours for some skilled workers to more than
sixteen hours for various categories of unskilled
workers. Wages were pitifully low and often paid in
vouchers redeemable at the company store. There
was a total absence of legislation to protect work-
ers against the hazards of unemployment, old age,
or industrial accidents.
Among the European immigrants were many
militants with socialist, syndicalist, or social-
democratic backgrounds who helped organize the
Brazilian labor movement and gave it a radical po-
litical orientation. National and religious divisions
among workers, widespread illiteracy, and quar-
rels between socialists and anarcho-syndicalists
hampered the rise of a trade union movement and a
labor party.
But trade unions grew rapidly after 1900,
and the fi rst national labor congress, representing
the majority of the country’s trade unions, met in
1906 to struggle for the eight-hour workday. One
result of the congress was the formation of the fi rst
national trade union organization, the Brazilian
Labor Confederation, which organized a number
of strikes that authorities and employers tried to
suppress by arresting labor leaders, deporting im-
migrants, and sending dissidents to forced labor
on a railroad under construction in distant Mato
Grosso. The phrase “The social question is a ques-
tion for the police” was often used to sum up the
labor policy of Brazil’s liberal state.Central American Politics
and Economy
In the last third of the nineteenth century, the three
Central American countries selected for special
study—Guatemala, Nicaragua, and El Salvador—
underwent major economic changes in response to
growing world demand for two products the area
produced in great quantity: coffee and bananas.
The changes included a liberal reform that sought
to promote economic growth but left intact exist-
ing class and property relations. This liberal pro-
gram also led to a new dependency, based on the
export of one or two products, foreign control of
key natural resources, and acceptance of U.S. po-
litical hegemony. Everywhere, these changes were
accompanied by concentration of landownership,
intensifi ed exploitation of labor, and a growing gulf
between the rich and the poor.GUATEMALA, 1865–1898
Rafael Carrera’s death in 1865 was followed by six
years of continuous liberal political and military
challenge to conservative rule in Guatemala. The
liberals responded to changes in the world econ-
omy, in particular to the mounting foreign demand