The Great Depression represents one of the notable economic tragedies in human history. Before this catastrophe, Latin America enjoyed a period of consumer boom as the leading international exporter. The Great Depression emanated from the collapse of the stock market in 1929 (Cardoso and Faletto 21). However, the ignorance of the Latin American leaders worsened the effects of the Great Depression. They had a negative attitude and vehemently renounced any likelihood of an economic downturn due to external factors. The existence of dominant populist leaders encouraged the defiance in the region, thus failing to recognize the harsh economic realities. As a result, the crisis affected nearly every manufacturing company and the producers of raw materials in Latin America (Barlean 29). It also increased the unemployment rate and adversely affected the high dependence on foreign funds. Essentially, the Great Depression destabilized the financial institutions, destroying the existing trade mechanisms such as the export-led model, thus necessitating the expansion of macroeconomic policies to mitigate the economic downturns.
Firstly, the export-led model focuses on expanding exports to boost the amounts of capital and labor in an economy. This approach improves the foreign currency finances of a country. Notwithstanding, its primary weakness is that it is highly vulnerable to adverse conditions in the global markets for products and services. According to Barlean, the export-led model encourages a state’s dependence on funds accrued from exporting a few major commodities (15). This reliance contributed to adverse economic effects evident in Latin America during the Great Depression. At the beginning of the Great Depression in the late 1920s, Latin America depended on three main export products, which accounted for nearly 50% of its foreign-exchange earnings (Cardoso and Faletto 97). Indeed, one of the commodities represented more than 50% of exports in ten nations. The decline in foreign demand for the primary products from Latin America led to a quick outflow of foreign exchange and gold rather than inflow. Consequently, the collapse of exports resulted in internal deflation, a decline in employment, and foreign debt crisis.
Secondly, the populist regimes of Mexico, Argentina, and Brazil changed the direction of their societies and economies in pursuit of a swift recovery from the negative aftermaths of the Great Depression. Between the 1930s and 1950s, populist leaders, including Juan Peron of Argentina and Getulio Vargas of Brazil inspired crowds of employees with rhetoric speeches based on class struggle, gender relations, and nationalism (Grigera 443). Indeed, by equating oligarchs with adverse effects of the Great Depression, populists gained electoral victories. Their regimes focused social and industrial development, especially by pursuing Import Substitution Industrialization (ISI). Populist leaders in Latin America ignored the principles of laissez-faire liberalism and promoted state authority and control over main sectors of the economy. For instance, Mexico passed reforms in land tenure and expanded the nationalized oil sector. Argentina capitalized on the non-export industry to support the stagnated wheat and meat export. On his part, Getulio Vargas of Brazil established the Brazilian Coffee Institute (IBC), which addressed coffee matters due to the reduction of prices in international markets. These efforts shaped the economic status of the three Latin American economies.
The populist leaders in the three countries also implemented social security systems to transform their societies. According to Campos-Herrera and de Reguero, the social programs favored the welfare and interests of the industrial working class, urban middle class, and to a less significant extent, the peasantry (153). The trade unions thrived in Brazil, Argentina, and Mexico, although populist leaders manipulated them. Significantly, women’s participation in the recovery process was critical for populist movements. Across the three countries, factory workers, peasants, and female teachers took advantage of the situation and organized themselves in groups. As a result, women’s involvement in the political arena grew rapidly, and they earned their right to vote and could air their economic and social demands (Barlean 67). There was also the expansion of the educational coverage and investment in public health, thus offering opportunities for the different population segments to access social services. Despite enacting social policies in Argentina, Brazil, and Mexico, the populist leaders failed to address the social inequality problem.
The global turmoil caused by the Great Depression inspired Latin American countries to embrace ISI to cushion their economies from international market fluctuations. The primary objective of ISI was to increase domestic production and lessen external market dependency. Specifically, this model significantly affected peasants and created new subjects such as urban migrants. According to Grigera, the increased investments in local industries created job opportunities that benefited small-scale workers (447). Additionally, with the increase of trade unionism driven by populist leaders, the industries raised the wages and strengthened the welfare of their employees. Peasants also learned and gained skills from the foreign capital markets that were critical in completing various tasks in the local industries. Since most industries were located in urban areas, most people migrated to towns to look for job opportunities. The increased occupational activities in the cities led to the proliferation of the urban migrants, which led to the rise of a new class in Latin America. The migrants became residents of the urban areas leading to population growth in the industrial cities.
The novels “The Death of Artemio Cruz” and “Here’s to You, Jesusa” reflect on the income inequality as it unfolded in post-revolutionary Mexico. In the 19th century, Mexico was an undeveloped agrarian economy, and thus, the level of income inequality was low. However, with the onset of industrialization, the political and economic elites conspired to control the Mexican economy, monopolizing state resources and preventing workers’ organization. In “The Death of Artemio Cruz,” Cruz, the protagonist, is presented as a young Mexican soldier who fights the oppressors and redistributes land to peasants (Fuentes 64). Nevertheless, Cruz changes later and uses deceitful acts to acquire wealth and oppress the less privileged people. Women could not own lands, and thus, Cruz used marriage tricks to become a rich person who even owned the local newspaper. Similarly, in “Here’s to You, Jesusa,” Jesusa struggles to survive in a male-dominated Mexican society after the death of her husband. Mexican society ignored women and perceived them as a weak gender that deserved only household chores (Poniatowska 21). Both tales demonstrate that income inequality in post-revolutionary Mexico emanates from gender discrimination and unfair redistribution of resources.
The Great Depression led to various undesirable economic effects in Latin America. The collapse of the exports contributed to weakened financial institutions, thus increasing unemployment and internal deflation. The dependence on the export-led development model made Latin America vulnerable to adverse external market conditions. However, the rise of populist leaders changed the economies and societies leading to the implementation of ISI and the social security systems. These efforts increased trade unionism and wages, which benefited peasants and improved Latin American economies. Despite investment in local industries to mitigate the negative effects of the Great Depression, income inequality persisted in Latin America. Based on “Here’s to You, Jesusa” and “The Death of Artemio Cruz,” the continued disregard of women and unfair redistribution of resources augmented income inequality in Mexican society. Indeed, the collision between the economic and political elites to control the available resources at the expense of the less privileged people continues to increase the Gini index in Mexico even today.
Works Cited
Barlean, Mary Kathryn. Gender Inequality and Export-Led Development: Neoliberal Reform in Latin America. San Diego State University, 2018.
Campos-Herrera, Germán, and Sebastián Umpierrez de Reguero. “Populism in Latin America: past, present, and future.” Latin American Politics and Society, vol. 61, no. 1, 2019, pp. 148-159.
Cardoso, Fernando Henrique, and Enzo Faletto. Dependency and Development in Latin America. University of California Press, 2021.
Fuentes, Carlos. The Death of Artemio Cruz. Translated by Alfred MacAdam, Macmillan Publishers, 2013.
Grigera, Juan. “Populism in Latin America: Old and new populisms in Argentina and Brazil.” International Political Science Review, vol. 38, no. 4, 2017, pp. 441-455.
Poniatowska, Elena. Here’s to You, Jesusa! Penguin Books, 2001.