During the 1920s, the United States experienced a period of great economic prosperity that came to an end on October 29, 1929. On so-called Black Tuesday, the stock market in New York City collapsed. That day is considered the beginning of the Great Depression, the biggest economic and financial crisis experienced by the United States. During the first years of the crisis, more than 9,000 banks failed, leaving their customers in ruins. With banks in bankruptcy, businesses had difficulty accessing credit to finance their activities. In an effort to save their businesses, companies began to cut costs and lay off employees in large numbers. Without work and without savings, the already scarce purchasing power disappeared, dramatically reducing the demand for goods and services. The economy came to a standstill. The market collapse, though it began on U.S. soil, it affected all of the international capitalist system.
Puerto Rico’s economic dependence and political subordination to the United States left the island at the mercy of the financial crisis. The effects of the Great Depression on Puerto Rico were devastating. The crisis hit the island as it was trying to recover from the devastation of Hurricane San Felipe in 1928. The Great Depression, on top of the effects of the storm, caused an immediate reduction in the prices and volume of exports. Like in the United States, industry’s lack of access to money and credit resulted in mass layoffs. The unemployment rate grew, increasing the desperation and inhuman working conditions among the lives of the laborers. The situation got worse with the passage of Hurricane San Ciprián in 1932. With winds estimated at 120 miles per hour, it battered the island for 7 hours and caused about 225 deaths. Hunger, disease and desperation hit the population full force.
The impact of the crisis was uneven in different parts of the economy and society. While agriculture’s contribution to the national product decreased, the governmental sector increased and became the most important source of spending. The sugar industry suffered less than the coffee and tobacco sectors. Thanks to the reduction in sugar production in Cuba and the rapid recovery of the cane fields after the hurricanes, sugar companies on the island experienced a surge. The needlework industry was also able to adapt and was relatively stable during the crisis.
Even in the midst of the crisis, some companies were able to make payments on stock dividends and bonds without changes and their net profits increased. The people, on the other hand, struggled day to day to survive. While the cane workers’ salaries were dramatically reduced, the prices of basic goods took off. Economist James L. Dietz, explains: “Rice sold at $2.40 per quintal in December of 1932; a year later, the price was $4.10. Imported beans rose from $3.00 per quintal to $5.25; salted cod from $19 to $28; lard, from $14.50 to $18. The price of a liter of milk rose from 5 cents to 14 cents, and a pound of bread from 4 cents to 10 cents.” If salaries for cane workers were miserable, they were worse for coffee and tobacco workers. Among the labor force, those who suffered most during the crisis were, first, women employed in the needlework industry and, next, those in the tobacco industry. Children also suffered greatly during the crisis. Because of malnutrition and disease, infant mortality rates rose.
The pain and deep need were fertile ground for many who questioned the U.S. regime on the island. Various sectors spoke out: In 1933, consumers protested; in 1934, cane workers went on strike and the unemployed protested in Ponce; and in 1935, the dock workers went on strike. During the cane strike of 1934, Pedro Albizu Campos, leader of the Nationalist Party, led the workers, explaining to them that salvation from the crisis could be found in independence for their homeland. His words did not win over the working class and the Nationalist Party could not establish a political alliance with them.
The Nationalist Party, founded in 1922, was one of the voices that openly criticized the U.S. regime, demanding independence for the island. Blanton Winship, governor of Puerto Rico, and Police Colonel Elisha Francis Riggs fiercely persecuted the nationalists. As a result, Albizu, along with other members of the party, were imprisoned in 1936 and sent to federal prison in Atlanta, Georgia. On March 21, 1937, the National Party organized a peaceful march in Ponce to protest the imprisonment of their leaders. In events that still remain unclear, the police opened fire on the unarmed marchers, killing and wounding innocent people in what is known today as the Massacre of Ponce.
The Great Depression shook the foundations of Puerto Rican society. In the economic realm, it undermined the rural structures of capitalism that were based on agriculture and set the stage for a transformation to industrial capitalism focused on manufacturing. In social and political terms, it revealed the weakness of the structures of colonial control and underlined the pressing need for changes in the relationship with the United States.
Author: Yanelba Mota Maldonado
Published: August 24, 2015.
This post is also available in: Español