Rafael Carrera and the Emergence of the Republic of Guatemala, 1821�1871

17. Infrastructure Development in Conservative Guatemala

C H A P T E R S E V E N T E E N Infrastructure Development in Conservative Guatemala THE THREE CENTURIES OF SPANISH RULE (1524-1821) represent a long transition from feudalism to capitalism, which was by no means complete by the end of that period. Although the sixteenth-century Habsburgs had encouraged mining and agro-exports, the conquistador generation and their Creole descendants were culturally more acquainted with feudal than capitalist traditions and institutions. In the seventeenth century, declining Spanish commercial and militarystrength contributed to retrenchment among the Creole landholding elite into self-sufficient estates and forms of labor control resembling medieval serfdom. Master-serf relationships evolved that have characterized Guatemalan rural life ever since.1 A small capitalist element, however, existed in Guatemala throughout the colonial period, and an important segment of the economy dedicated itself to agroexports , first of cacao and later of indigo. Yet the majority of the declining population was engaged in economic activity more akin to feudalism than capitalism.2 The eighteenth-century Bourbons, however,put great emphasis on capitalist development and especially on agro-exports and mining in underdeveloped areas of the empire, such as Central America. Following independence the liberals continued the Bourbon emphasis on exports. Despite the theoretical liberal concept of laissez faire, from the beginning they assumed that government should play a major role in the stimulation of agricultural expansion.3 351 352 / Socioeconomic Change Paradoxically, two institutions that originated in Guatemala from the Bourbon economic policies—the Consulado de Comercio and the Sociedad Economica de Amigos del Pais—came to be closely associated with the conservative elite of the capital. Even though in the colonial period these institutions, especially the Economic Society, had a liberal image in that they were part of the effort to expand capitalist-oriented production and trade in Central America, their domination by the conservative interests of the capital after independence made them targets of the liberals. From 1840 to 1871 they played a key role in the economic structure and growth of the country. The restoration of the Consulado in 1839provided the institutional base for representation of the Guatemala City mercantile elite in the political and economic structure of the conservativestate. Although this institution dated only from 1794 in Guatemala, its restoration reflected the return to Hispanic corporatism so characteristic of the reaction that swept over Guatemala in 1839. The government renewed the broad powers over commerce , transport, ports, and export production that the real cedula of 1793 had granted the Consulado, so that the merchants of the capital had a virtual monopoly over Guatemalan commercial development during the conservative years. The merchants also regained their exclusive tribunal, or fuero, suppressed in 1829, which gave them a privileged position in the judicial structure of the state. The Consulado was a prime example of how class privilege was an intimate component of conservativerule in the midnineteenth century and a strong force for the maintenance of the status quo. Not surprisingly, the Consulado was one of the first institutions the liberals abolished in 1871.4 The preamble to the decree restoring the Consulado reasoned that it was necessary for the protection and development of the nation's industry, agriculture , and commerce, and with government favor the institution gained in importance and power. By mid-December 1839 the Consulado had already initiated several public works projects.5 The new Consulado regulated and supervised commerce and carried on a program of infrastructure development more extensive than any previously in Guatemala's history. Moreover, it became an important adviser to the government on economic and other matters. Acts of 1851 gave the Consulado representation in the National Assembly and made the prior of the Consulado a member of the Council of State.6 The state borrowed significant sums from the Consulado 's treasury and called on it to collect loans for the government from its constituents. The Consulado was essentially a quasi-governmental agency that reflected the corporate nature of the conservative regime. While its Infrastructure Development / 353 tribunal, composed of the prior and two consuls, maintained the merchants ' fuero and represented the Consulado's position of authority within the structure of the Guatemalan state, its Junta de Gobierno carried out the economic functions. The Consulado shared responsibility foreconomic development with the Economic Society, first founded in Guatemala in 1794. Efforts to revive the institution to promote new economic activity occurred in i825and again...