Puerto Rico, Sweet Land of Liberty
[Reprinted from Land and Freedom,
A demonstration of the universal character of the land question, as
it appears within a particular national economy, was one of Henry
George's important contributions to economic theory. The question,
George held, "is nothing less than that question of
transcendental importance which is everywhere beginning to agitate
and, if not settled, must soon convulse the civilized world," the
question whether the masses of mankind will be con tent with poverty
amidst actual and potential abundance.
Distress was acute in Ireland in George's time and the situation was
dramatized by the agitation of Parnell, Davitt and the Land Leaguers.
George analyzed this situation in The Irish Land Question,
afterward published as The Land Question. He found the cause
of the distress in the system of land tenure which prevailed there,
the system of absolute private ownership of land and noted that "essentially
the same land system a that of Ireland exists elsewhere, and, wherever
it exists distress of essentially the same kind is to be seen."
He concluded that everywhere the connection between the system of
tenure and the social problem of pauperism is "that of cause and
This principle of George's has resulted in many studies of various
types of economies by students of the social sciences. These studies
have particular value for the science of economics. Not even in the
United States where statistical research has made great advances in
the past two decades, are data available for a complete analysis of
the economic effects of privilege. Thus the student must turn from the
monopolistic-imperialist economy to other types.
It is not true that the seemingly exact scientific method, of
laboratory analysis, experiment and proof, which is associated with
the physical and biological sciences, cannot be approximated in the
social sciences, and particularly economics. One cannot experiment
with the happiness and well-being of 135,000,000 persons, of course,
in the present delicate state of the economy.
But, as George pointed out, in the less advanced economies the
relation between land and labor can be seen with such distinctness
that it is seen "by those who cannot in other places perceive
them." This is possible, he continues, because of certain special
conditions peculiar to the particular economy. Definition of these
special conditions is of no concern here; they are not always
identical, from one country to another, and probably need not be.
These studies have been limited in the light they have thrown on the
principle only by the limited character of the data available.
Fortunately, the growth of interest in George's work in recent years,
and the passing of the content of his emphasis upon land reform into
the systems of leading economists a process which is only in its
beginnings have given a new direction to economic and social
inquiries, making accessible much new information bearing upon this
A very valuable one has just appeared, a study of "The Dilemma
of Puerto Rico," by Earl P. Hanson, who served as a member of the
executive board of the Puerto Rican Reconstruction Administration, an
agency of the United States Government. Mr. Hanson was on loan to it
from President Roosevelt's National Resources Committee, of which he
was planning consultant.
Poverty is a bitterly abject thing in Puerto Rico, according to Mr.
Hanson's study. "On the outskirts of every town are found the
same dismal slums, thousands of miserable huts mushrooming out of land
that is often marshy and infected," he writes. "All parts of
the island, and particularly the coastal plains, are dotted with
'houses' built of hurricane debris, old gasoline tins and old rags,
often on squatters' land, where there is no chance to grow food."
On the roads and in the streets large groups of jobless "jibaros,"
poor peasants, dejectedly mill back and forth in the hopeless search
for work. "It is a common sight," he declares, "to see
them (the permanently unemployed) scavenging in garbage pails in the
cities and begging their food from garbage trucks."
Unemployment in this agricultural economy is as widespread as it was
in the United States in 1932. The Federal Emergency Relief
Administration estimated that there are in Puerto Rico not less than
150,000 heads of families permanently unemployed," which is about
one-third the working population. The Brookings Institution inquiry in
1929 showed that in the city of Ponce 47 per cent of the men
investigated were unemployed either totally or periodically. For jobs
of the white- collar class, 41,745 persons applied to the Puerto Rican
Reconstruction Administration in September, 1936. About 100,000 men,
or about one-fourth of the working population, are employed only
during the harvest and grinding season from January to July in the
sugar industry and are idle afterward.
Wages in this section, seat of one of the most important sugar
industries in the world, are incredibly low. The industry, in spite of
large earnings, paid its workers wages that averaged about 12 cents a
day per worker and dependent in 1929, and the average has not changed
since. The average annual wage of a seasonal worker is about $150, on
which he has to support a family of about five dependents.
Real wages are lower than even the nominal wage would indicate. Food
and practically all the necessities of life must be imported, in the
highly expensive tariff protected American market. The employed
workers are forced to buy from company stores, an additional monopoly
which exacts its price.
About 94 per cent of the average worker's income is spent for
inadequate food. On the inadequacy of the food, L. M. Ramos reported
in a study for the Department of Education, San Juan: "One of the
most disturbing aspects of the family budgets of the island is the
dominance of imported dry food, especially polished rice. The bad
hygienic results of the diet so lacking in vitamins need no comment .
. . Monotonous and debilitating diet is used by a large proportion of
The effects of the diet are seen clearly in the health of the
workers. Nearly 90 per cent of the rural population and about 40 per
cent of the urban inhabitants have hookworm in their intestines,
according to Dr. Walter C. Earle of the Rockefeller Foundation,
reporting to the American Journal of Tropical Medicine. The death rate
from gastro-intestinal diseases is about 360 per 100,000, against 25
in the United States, 40 in Alabama. Tuberculosis, despite the
sunniness and healthiness of the climate, accounts annually for 325
deaths per 100,000 population, the highest for any civilized country
for which statistics are available, against 60 in the United States,
90 for Tennessee. This was reported by Dr. Costa Mandry in the Puerto
Rico Journal of Public Health and Tropical Medicine. Malaria,
according to the Insular Department of Health, is responsible for 8
per cent of the total deaths, 175 per 100,000, six times that of the
four most malaria-ridden southern states combined.
Virtually nothing remains of the worker's pitifully small income for
housing, clothing, medicine and similar necessities. The Brookings
Institution, after its investigation in 1929, declared: "The
problem here is fundamentally economic and not sanitary." The
problem, it continued, had its roots in poverty.
The growth of population and its relation to the natural resources of
the island has special significance for the Georgeist student. As in
all countries where life is hard for the common man, the population
continued to grow steadily and to enlarge the island's social
problems. From about 900,000 in 1897, it has grown to 1,723,534 in
1935, according to the P. R. R. A. census.
The birth rate is fairly steady at about 40 per 1,000. The death rate
has been gradually decreasing since the American occupation and is now
about 18 per 1,000. The natural increase is around 38,000 per year.
The overall density of population is about 510 per square mile. This,
as Mr. Hanson points out, is exceeded only in such industrial
countries as Belgium and the Netherlands and in such agricultural
countries as Java and some of the West Indian Islands. The social
problem in Belgium and the Netherlands is nowhere so acute that it can
be compared with that of Puerto Rico. Java is a classic example of
what happens to a dense population when social institutions and
customs hem it in. The density per square mile of cultivated land,
1,500, is about the same in Java as it is in Puerto Rico. But Java
must yield to Puerto Rico as a classic example, according to Mr.
Java has a greater proportion of its land cultivated by and for its
inhabitants, including cultivation for direct consumption and for
exchange for commodities desired for consumption. It has a greater
diversification of crops. Therefore, Mr. Hanson concludes, the
effective density of population in Puerto Rico is perhaps the greatest
in the world. For in calculating the population supported by the land,
one must include not only those who work upon it, but those who live
off it, the owners present in Puerto Rico and the owners absent in the
Rice, beans and peas, the principal foods imported from the United
States, all are grown in Puerto Rico. But the per capita acreage
devoted to them has declined steadily from 1897 to 1935. Meanwhile the
acreage devoted to the export crops has almost doubled. Specialization
in cash export crops would result in an even higher standard of living
for Puerto Ricans under a free economy; under monopoly capitalism they
are robbed of that as well as of an average primitive subsistence.
The social problem outlined above is explained by the changes in land
use and tenure, reliable figures for which are now available in a 1936
report by Rafael Pice to the Puerto Rican Reconstruction
The total amount of land under cultivation has practically doubled
since 1899, together with the population. In 1899, the total of
cultivated land was 477,987 acres; in 1909 it was 542,675 acres and in
1929 it was 756,642. The increase in cultivated land between 1909 and
1929 was 213,967 acres. From the close of the Spanish-American War to
the beginning of the world depression there was little change in the
amount of land under cultivation per capita. In 1899 this was 0.50 of
an acre; in 1909 0.49 and in 1929 again 0.49 of an acre.
But between 1920 and 1930 there were highly significant changes in
the distribution of the land in farms. To make these changes clear,
the figures are given first, then the significance is drawn. Land in
farms of 500 acres and over, including cultivated and uncultivated
land, increased from 662,970 acres to 867,490 acres, a gain of 202,520
It will be noted that the increase in land in farms of 500 acres and
over is almost exactly the same amount as the increase in the total
amount of land under cultivation. This increase took place, Mr. Hanson
points out, "in spite of the fact that these farms are largely
illegal under Puerto Rico's Organic Act."
But during the same period the total number of farms of 500 acres and
over decreased from 539 In 1910 to 367 in 1930, a drop of 172.
The fact that the total number of farms of 500 acres and over
decreased by almost one-third, while at the same time the land area in
them increased by 33 per cent shows the greater concentration of land
ownership in those farms, among the farms of 500 acres and over, which
had the larger area.
In the same period, the land in farms operated by their owners,
including cultivated and uncultivated land, fell from 1,457,345 acres
in 1910 to 1,166,976 acres in 1930, a decrease of 290,369 acres. But
the land operated by managers increased from 401,749 acres in 1910 to
676,760 acres in 1930, an increase of 275,023 acres.
As Mr. Hanson points out, these items are highly significant from a
social point of view. They show "that while the large estates
increased, the acreage of land operated by owners decreased by some
300,000 acres, the land operated by managers increasing by almost the
same amount." The figures give a clear picture of the process by
which the Puerto Ricans were expropriated from their land.
When the data on land use is examined, the nature of this process is
disclosed. Land in sugar cane rose from 72,146 acres in 1899 to
145,433 acres in 1909 and to 277,758 acres in 1929, an increase from
1909 to 1929 of 92,325 acres. Land in coffee fell from 197,031 acres
in 1899 to 186,875 acres in 1909, but then rose to 193,561 a gain from
1909 to 1929 of 6,686 acres. Land in tobacco increased from 5,963
acres in 1899 to 22,142 acres in 1909 and then jumped to 52,947 acres
in 1929, an increase from 1909 to 1929 of 30,805 acres. The export
fruit industry is so comparatively new to Puerto Rico that the land in
fruits did not warrant separate reporting in the 1910 census, but in
1930 it amounted to 8,366 acres.
The total land in the four main export crops rose from 275,140 acres
in 1899 to 354,450 acres in 1910, and then increased to 492,638 acres,
a rise of 138,182 acres. At the same time, the land in food crops fell
from 0.22 acres per capita in 1899 to 0.16 acres per capita in 1930, a
fall from 1899 to 1930 of 0.06 acres per capita.
Mr. Hanson's explanation is worth quoting verbatim. He says:
"In most cases, managers in Puerto Rico mean
absentee ownership. The absentee owners who have come to dominate
the island's economy since the American occupation are interested
entirely in cash-export crops.
"The increase of some 140,000 acres planted to these crops,
and particularly the increase of almost 100,000 acres planted to
sugar, indicates that while the extension of land under cultivation
kept pace with the growth of population, this extension was made
largely by and for absentee owners, bringing comparatively few
benefits to the island's population.
"Most of the concentration of land in large estates has taken
place on the coastal plains, on lands devoted to sugar. This land,
consisting to a large part of alluvial soils, is the most valuable
land on the island."
Mr. Pica's data gives an interesting picture of how the American
corporate landowner squeezed the Puerto Rican land user from
possession of the soil of his native island. Mr. Hanson has calculated
from the United States Census of 1930 how farms now range in size,
giving a clear picture of the present concentration of land ownership.
There are 37,587 farms of 19 acres and less, which are 71 per cent of
the total number of farms. The total acreage of these farms is
278,935, or 14.1 per cent of the total acres in farms. Farms of 20 to
49 acres numbered 8,835, 16.7 per cent of the total number. The total
acreage of these is 264,712, or 13.4 per cent of the total acres in
farms. There are 3,351 farms from 50 to 99 acres, 6.3 per cent of the
total number. Their acreage is 226,464, or 11.4 per cent of the total.
Farms from 100 to 499 acres numbered 2,825, or 5.3 per cent of the
total number. Their total acreage is 341,873, or 27.4 per cent of the
total land in farms. Farms of 500 acres and over numbered only 367, or
0.7 per cent of the total number. But the total acreage in these farms
is 867,490, or 33.7 per cent of the entire area of land in farms.
These figures show that more than one-third of the land in farms is
in those of 500 acres and over, which comprise less than 1 per cent of
the number of farms. At the same time, the family-size farms, the
small farms of less than 20 acres, which make up 71.0 per cent of the
total number of farms, include only 14.1 per cent of the land.
Mr. Hanson contrasts the present situation with that which obtained
before the blessings of American occupation were visited upon the
"According to the census of 1899," he points
out, "more than three-quarters of the total area of Puerto Rico
(2,743 square miles) was then included in farms. The average of
cultivated land to each farm was 12 acres, and the proportion of
farm owners to the whole number of farms was 93 per cent, contrasted
with but 28 per cent for Cuba.
"The military authorities who took the census and wrote a
detailed discussion of it were almost prophetic of the civil
disturbances tearing Puerto Rico today, when they said: 'This
general ownership of farms, however brought about, has
unquestionably had a great influence in producing the contented
condition of the people of this island as contrasted with the
restlessness of the Cubans'."
With the decline in land available for use for food crops, Puerto
Rico today imports over 60 per cent of the food she consumes. Mr.
Hanson points out that if this meant that the Puerto Ricans were
exchanging their export crops which can be produced so efficiently on
the island for food crops which can be grown more efficiently
elsewhere, they would have a high standard of living in spite of the
population density, and perhaps, in part, because of it.
But that this is not being done is illustrated by the position of the
sugar industry. This industry, which replaced coffee as the backbone
of the Puerto Rican economy, accounts for 64 per cent of the island's
exports and employs about one-fourth of the working population.
Purchasing power, under the stimulus of its growth, rose from $20 per
capita in 1899 to about $70 in 1935, as measured by imports into
But about two-thirds of the securities of the sugar corporations are
held outside the island. Of 41 mills operating in Puerto Rico, 11 are
controlled by four large absentee corporations, and these 11 produced
nearly half of the total sugar production of 1936. Esteban A. Bird
calculated in a special report to the P. R. R. A. that between 1920
and 1935, three of the large sugar companies alone paid dividends and
accumulated a surplus amounting to $80,000,000.
These are not the least of the charges in the indictment of the sugar
land monopoly of Puerto Rico. The Brookings Institution investigators
found that the lands on which the sugar industry pays taxes are on the
whole under-assessed by perhaps 25 per cent, while most other lands
are over-assessed to meet the needs of a financially embarrassed
In addition, Mr. Hanson points out that much of the sugar industry
was created under the American tariff and is artificially maintained.
"How large a proportion of the industry could survive and compete
with such areas as Cuba in the world market," he adds, "is
open to question." Also, as a result of the chaotic conditions
created by the dominance of this monopolistic industry, other Puerto
Rican crops suffer an almost complete lack of credit and distribution
facilities, resulting in high efficiency and waste.
How the economic and monopoly rent of Puerto Rico is exported to the
absentee owners is shown by Mr. Hanson in a study of the balance of
"It (the balance) has been against Puerto Rico only
five years out of the last thirty-five. But this apparently
excellent balance of trade, showing an average (annual) gain of some
$10,000,000 in favor of the island is purely fictitious.
"The exports of cash, in the form of dividend payments,
interest payments (on bonds), real estate rentals and freight
charges, and the like, so far exceed the paper balance that the net
balance is somewhere around $10,000,000 against rather than for the
Mr. Hanson's study is published by
Science and Society, A Marxian Quarterly (in the Summer, 1937,
issue). If it were not for the fact that his approach to the question
of land ownership is Georgeist rather than Marxist, one would be led,
by the fact that some of his proposals on the tariff questions
involved are distinctly not Georgeist and by the conclusions which he
draws from his data, to suspect that he chose his medium of
publication out of sympathy rather than expediency.
He considers the efforts being made by the Federal government to
reduce absentee ownership by purchase and to resettle Puerto Ricans on
land of their own as "praiseworthy." He himself sees,
however, that "the difficulties imposed by federal restrictions
and local conditions are almost overwhelming." Even if the
programme for the next two years is fulfilled, the P. R. R. A. will
have resettled only about 15,000 families.
"At the general average of about 5 per family, this will be
about half of the natural increase in population since the P. R. R. A.
was first organized," he points out, "showing that the P. R.
R. A. as a reconstruction agency has so far been unable to work fast
enough to keep pace with the natural population growth."
Moreover, he notes that "in the last few years the federal
government has expended or allotted between $60,000,000 and
$80,000,000 for relief and reconstruction alone, in an apparently
futile effort to hold Puerto Rico together" and makes the sage
comment, although he does not seem to realize just why this is, that "the
island has been compared with a cow that is fed by the American
tax-payers and milked by a few large absentee corporations."
Mr. Hanson's conclusion is that the proper kind of independence is
the indicated solution for "the dilemma of Puerto Rico."
This explains the variety of ideological debts which enable him to
make a Georgeist approach to an economic situation in a Marxist
magazine and yet draw the most conservative conclusions. He must be a
New Dealer by conviction as well as connection: one speech forward,
two steps backward, as a wit once defined that social philosophy.
"What kind (of independence) is eventually
achieved, and how it is achieved, depends on the organized
determination of the Puerto Rican people to liberate themselves from
their present dilemma, and on the extent to which they succeed in
breaking through to the consciousness of the American people in
their pleas for independence and for their own right to help
themselves out of an intolerable social-economic mess."
This conclusion of Mr. Hanson's is totally inadequate. The editors of
the Marxian quarterly should have realized it, not so much as
Marxists, for not even in Soviet Russia, in spite of the best of
intentions, has there been rational settlement of the land question,
but at least as students of economics alert enough to recognize the
importance of the Puerto Rican data.
With the desire of the Puerto Ricans to free themselves from American
imperialism, all lovers of freedom must sympathize. Their right to
help themselves is undeniable. But no form of independence will solve
their problem until they come to grips with the system of land tenure
prevailing on the island.
The data presented above shows clearly that unemployment exists on
the island because Puerto Rican labor is denied access to the land.
Mr. Hanson admits that it shows clearly that even if a primitive
economy were substituted for the present one, the standard of living
would be raised to a fairly comfortable level so long as the land of
Puerto Rico were open to the people of Puerto Rico.
It would be a reactionary step to revert to a primitive economy
however, and neither Mr. Hanson nor the present writer would advocate
this. It would be a needless step. For the drain on the Puerto Rican
economy which payment of economic and monopoly rent to private land
owners represents, shown so clearly by Mr. Hanson in his analysis of
the export of capital claims against the wealth produced in Puerto
Rico, could be dammed at once by means of the social land value tax.
This would enable the Puerto Ricans to continue concentration upon
cash export crops, while at the same time opening up less valuable
land to diversified food crops. It would enable them to abolish their
system of taxation, which Mr. Hanson shows to be inequitable, and
thereby release labor and industry from governmental exactions which
Next, they would need to campaign for independence. Not mere
political independence, but independence also from the exploitative
tariff system of Imperial America, which robs them, as Mr. Hanson
shows, through the exorbitant prices they must pay for the foodstuffs
and other commodities which it is advantageous for them to import.
This would also free them from the dominance of the sugar industry if,
after the abolition of tax burdens and the more efficient use of land
which the socialization of rent would tend to produce that industry
were still found to be largely parasitical. All these measures would
tend to make capital available for all the island's industries as well
as new industries, and not only for the sugar industry.
The Puerto Ricans could go on from there. If they did, Puerto Rico
might one day be an American Utopia. At least it would have a higher
standard of living than would prevail in the monopolist mother
country, technological advance or no technological advance. Mr.
Hanson, in his frank and honest analysis of the measures to which he
gave his own expert service, proves that if the Puerto Ricans do not
go on to there, their condition will remain hopeless.
The situation of Puerto Rico today is almost identical with that of
Ireland in the '80's. What Henry George told the leaders of the Irish
land reform movement needs to be told Mr. Hanson and all friends of
the Puerto Ricans, as well as the leaders of the independence
movement. It makes no difference whether the absentee owners live
around the corner or across the ocean. So long as there are absentee
owners, so long will the emancipation of the Puerto Rican people be
When equal rights to the land are acknowledged, when the land is
freed for efficient exploitation by the user, when taxes, tariffs and
all monopoly exactions which burden and strangle production are
abolished, only then will the economic dilemma of Puerto Rico be
When all special privilege is abolished by the socialization of rent,
beginning with the greatest and most pernicious privilege, absolute
private ownership of land, when natural opportunities and forces are
freed to the producer by the application of the revenue from the
socialization of rent to the maintenance of enlarged social services,
then, and then only will Puerto Rico be able to become a true
"Not a republic of landlords and peasants; not a
republic of millionaires and tramps; not a republic in which some
are masters and some serve. But a republic of equal citizens, where
competition becomes cooperation, and the interdependence of all
gives true independence to each; where moral progress goes hand in
hand with intellectual progress, and material progress elevates and
enfranchises even the poorest and weakest and lowliest."
And this can only be done when the Puerto Rican people are made to
realize this, as thousands are being made to realize it in the United
States through the social movement Henry George founded, and when they
demand it. It still remains true that the enemy of the Puerto Rican
people is not the American imperialist who is a parasite upon them,
but their own ignorance of how their economy is working and how its
evils can be abolished.