Abstract
The explosive tourism-led growth experienced by the U.S. Virgin Islands during the 1960s and early 1970s reflected the duality of the Virgin Islands’ socioeconomic identity. Although growth was dependent on the U.S. economy and U.S. policies, it also reaffirmed the links the Virgin Islands had developed with the Eastern Caribbean labor market in spite of their unique history as a Danish and then an American colony. Relatively large scale inflows of Eastern Caribbean labor caused both general and relative wage effects, compression of the wage and income structures, and redistribution of income away from labor. Increased labor market segmentation exacerbated the inherent ambivalence of the Virgin Islands’ Eastern Caribbean identity. The nature of the transformation of employment and income in the Virgin Islands undermined the benefits derived by the indigenous labor force and established the bases of subsequent socioeconomic conflict.
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Notes
The concept of “unincorporated territory” was first applied to the islands acquired by the United States in 1898 as a result of the Spanish-American War. Earlier acquisitions on the North American mainland had been regarded as extensions of the nation whose citizens were entitled to the same civil rights as residents of the states. In contrast, it was widely viewed as inappropriate to attempt to fully integrate the “alien,” largely non-white, residents of the new territories into the body politic. See Isaac J. Cox, “The Era of Overseas Expansion,” inThe American Empire, ed. William Haas (Chicago: University of Chicago Press, 1940), 1–24, and Whitney Perkins,Denial of Empire: The United States and its Dependencies (Leyden: A.W. Sythoff, 1962). For the Virgin Islands this official attitude has meant, for example, that although the islands were acquired by treaty and not by conquest, Virgin Islanders were subject to military rule from 1917 to 1931, did not become U.S. citizens until 1927, did not have a local constitution (Organic Act) until 1936, did not elect their own governor until 1970, and must have congressional approval for changes in the structure of local government.
Bonham Richardson,Caribbean Migrants: Environment and Human Survival on St. Kitts and Nevis (Knoxville: University of Tennessee Press, 1983).
W. Arthur Lewis, “Economic Development with Unlimited Supplies of Labor,”Manchester School, 22 (May 1954): 400–449; “Unlimited Supplies of Labor: Further Notes,”The Manchester School, 26 (May 1958): 1-32; “Development and Distribution,” inEmployment, Income Distribution and Development Strategy, ed. A. Cairncross & Y. Puri (London: Macmillan, 1976), 26-42.
Jannette O. Domingo, “The Role of Imported Labor in Virgin Islands Economic History” (Ph.D. diss., Columbia University, 1986), 31–33 and 97–119.
In a “direct transmission” model of the relationship between changes in the U.S. economy and employment in the Virgin Islands, U.S. macro indicators such as GNP, consumption, and personal income explain over 90 percent of the variation in Virgin Islands employment from 1960 to 1977. U.S. real GNP with a one-year lag is the best estimator, explaining 97 percent of the variation in local employment. The model demonstrates the dominant impact of exogenous factors on the Virgin Islands economy. See Jerome McElroy, “Remodelling the Model,” inEconomic Review (3rd Quarter 1978), V.I. Department of Commerce (St. Thomas: V.I. Department of Commerce, 1978), 6–7.
V.I. Department of Commerce,Annual Report FY 1965 (St. Thomas: V.I. Department of Commerce, 1965), 9.
Section 101(a)(15)(H)(ii) of the 1952 Immigration and Naturalization Act allowed nonimmigrant workers to enter the United States and its territories to filltemporary positions. However, as a result of lobbying by Virgin Islands employers, in 1954 the House Judiciary Committee recommended a “more realistic and expeditious application” of Section H-2 which would allow workers from the neighboring British Virgin Islands to fill jobs in agriculture and tourism despite the fact that those jobs, especially in hotels, were becoming less and less seasonal. Even though there was no new legislation nor additional directives from Congress, by the early 1960s the Immigration and Naturalization Service had further extended this liberal reinterpretation to include all British West Indians as well as workers from the French and Netherlands Antilles and to allow their employment inany job for which there was a shortage of labor. Both the original geographic selectivity and occupational restrictions of the expanded H-2 program were abandoned. See Senate Committee on Interior and Insular Affairs,Virgin Islands Report Relative to Investigation & Hearings in the Virgin Islands with Reference to Proposed Revision of the Organic Act & Governmental, Economic & Fiscal Structure in the Islands, with Recommendations on the Federally Owned Virgin Islands Corp (Washington, D.C.: GPO, 1954); House Committee on the Judiciary, Subcommittee on Immigration, Citizenship, and International Law,Non-Immigrant Alien Labor Program on the Virgin Islands of the United States: A Special Study (Washington, D.C.: GPO, 1975), 5-15.
House Committee on the Judiciary,Non-Immigrant Alien Labor Program, 30–1.
In Europe, the boom years of the 1960s and early 1970s also involved large scale labor movements from less developed countries or regions-Southern Europe and North Africa—and generated extensive contemporary discussion of the socioeconomic impacts of such immigration, especially the relative and general wage effects. See, for example, Vera Lutz, “Foreign Workers and Domestic Wage Levels, with an Illustration from the Swiss Case,”Quarterly Review, Banca Nazionale del Lavoro, 16, no. 64 (1963): 3–68; E.J. Mishan and L. Needleman, “Immigration, Excess Aggregate Demand and the Balance of Payments,”Economica (May 1966); “Immigration: Some Long-Term Economic Consequences, Part A,”Economia Internazionale 21, no. 2 (1968): 281-98; Charles P. Kindleberger,Europe’s Post War Growth: The Role of Labor Supply (Cambridge, Mass.: Harvard University Press, 1967); Suzanne Paine,Exporting Workers: The Turkish Case (London: Cambridge University Press, 1973); Stephen Castles and Godula Kosack,Immigrant Workers and Class Structure in Western Europe (London: Oxford University Press, 1973).
Domingo, “The Role of Imported Labor,” 86–90.
SERD (Social, Educational Research and Development, Inc.),Aliens in the United States Virgin Islands: Temporary Workers in a Permanent Economy (St. Thomas: College of the Virgin Islands, 1968), 2;A Profile and Plans for the Temporary Worker Problem in the United States Virgin Islands (St. Thomas: College of the Virgin Islands, 1969), 43.
This also implied a greater increase in income to other factors of production. However, only a small percentage of families had sources of income other than wages. By 1970 only 9.65 percent of all families had “other income,” i.e., interest, dividends, or net rent-5.65 percent of black families and 23.94 percent of white families. See Department of Commerce, Bureau of the Census,Census of Population (Washington, D.C.: GPO, 1970). Furthermore, nonwage sources of income-capital and land—were increasingly foreign owned. Both tourism-related growth and industrial development were financed by outside investors.
Department of Labor, Employment Standards Administration,Wage and Hour Division,Economic Report on Industries in the Virgin Islands (Washington, D.C.: U.S. Department of Labor, 1960-1977).
For computations see Domingo, “The Role of Imported Labor,” 278–93.
Gordon K. Lewis,The Virgin Islands: A Caribbean Lilliput (Evanston: Northwestern University Press, 1972), 208.
Use of the term “bonded alien” or “bonded worker” persisted throughout the 1960s even though the practice of requiring employers to post a bond for H-2 workers was discontinued in 1959. The continued use of the term may well have been fostered by the contemporary system’s evocation of the nineteenth and early twentieth century exploitative agricultural contract labor imports for which bonds were also posted. As part of the H-2 program, from 1956 to 1970 the Virgin Islands Department of Labor’s Employment Security Agency had to certify that no qualified local labor was available before an employer’s petition for imported labor would be accepted by the INS. A renewable six-month work permit was then issued to allow a foreign worker to fill that particular position. From 1971 to 1976 the U.S. Department of Labor, Manpower Administration’s Alien Certification Office administered the program, thus by-passing the local agency.
SERD,Aliens in the United States Virgin Islands, 31.
V.l. Department of Labor, Employment Security Agency,Annual Report (St. Thomas: V.l. Department of Labor, 1961-1972).
V.I. Employment Security Agency,Annual Reports, 1967-72; V.I. Department of Labor, Bureau of Labor Statistics,Hours and Earnings in Wholesale and Retail Trade (St. Thomas: V.I. Department of Labor, 1973-76);Hours and Earnings in Manufacturing, (St. Thomas: V.I. Department of Labor, 1973-77). In spite of above average wages, construction was shunned by local labor because of a long tradition of aversion to manual labor. See Albert Campbell,St. Thomas Negroes: A Study of Personality and Culture (Evanston: American Psychological Association, 1943); Edwin Weinstein,Cultural Aspects of Delusion: A Psychiatric Study of the Virgin Islands (New York: The Free Press, 1962).
The white population of the Virgin Islands had increased primarily through relocations from the mainland United States. By 1970 only about 26 percent of the white population was native born. A majority, about 52 percent, was U.S. born, another 8 percent born in Puerto Rico, and 14 percent foreign born. Department of Commerce, Bureau of the Census,Census of Population (Washington, D.C.: GPO, 1970).
V.l. Employment Security Agency,Annual Report FY 1961.
V.l. Department of Commerce, Office of Policy, Planning & Research,Overall Economic Development Program for the Virgin Islands FY 1978 (St. Thomas: V.l. Department of Commerce, 1978), 104–108.
G. Lewis,The Virgin Islands, 320; William W. Boyer,America’s Virgin Islands: A History of Human Rights and Wrongs (Durham: Carolina Academic Press, 1983), 362–68.
Abuses of patronage, including adoption of a controversial “loyalty oath,” and the declassification, dismissal, or intimidation of disloyal employees were documented in the lengthy proceedings of the 1967 Congressional hearings on the proposed election of the Virgin Islands governor. See House Committee on Interior and Insular Affairs, Subcommittee on Territorial and Insular Affairs,Election of Virgin Islands Governor: Hearing Before the Subcommittee on Territorial and Insular Affairs, 90th Cong., 1st sess., 17 & 19 June 1967. The Department of Interior’s Comptroller for the Virgin Islands was also sharply critical of the results of the local patronage system. In the comptroller’s judgment, political control by a small group had become “self perpetuating by the granting of special favors and jobs and masking the control objective under the guise of humanitarianism.” The comptroller’s report also emphasized the increased costs of government services caused by the bureaucracy’s notorious inefficiency, and the waste of manpower that could (theoretically) have been employed in the private sector to reduce the dependency on imported labor and the social costs associated with the enlarged population. See Department of Interior, Office of Territories, Government Comptroller for the Virgin Islands,Annual Report FY 1969 (Washington: Department of Interior, 1970), 8.
Ibid.
Jerome McElroy,The Virgin Islands Economy: Past Performance and Future Projections (St. Thomas: V.I. Department of Commerce, 1974), 71.
Darwin Creque, “Some Problems of Economic and Social Development,” inVirgin Islands: America’s Caribbean Outpost, ed. James A. Bough and Roy C. Macridis (Wakefield, Mass.: Walter F. Williams Publishing Co., 1970), 166–167; Philip Gerard, “Social Configuration and Some Problems,” in Bough and Macridis,Virgin Islands Outpost, 160-61; Thomas Mathews, “Social Configuration and its Implications,” in Bough and Macridis,Virgin Islands Outpost, 170-72; Valdemar Hill,Rise to Recognition: An Account of U.S. Virgin Islanders from Slavery to Self Government (St. Thomas: V.A. Hill, 1971), ch. XI; G. Lewis,The Virgin Islands, 169; Isaac Dookhan,A History of the Virgin Islands of the United States (Epping, Essex: Caribbean Universities Press, 1974), 307.
V.I. Department of Commerce,Annual Report (St. Thomas: V.l. Department of Commerce, 1960-70).
Hill,Rise to Recognition, 114-115; Bruno Neumann, “The Economy of the Virgin Islands,” in Bough and Macridis,Virgin Islands Outpost, 145–155.
Report of the House Select Committee on Population, Legal and Illegal Immigration to the United States, 95th Congress, 2nd sess., (December 1978), 45.
House Committee on the Judiciary,Non-Immigrant Alien Labor, 43; Boyer,America’s Virgin Islands, 299.
V.I. Economic Policy Council,Economic Policy Guidelines (St. Thomas: Office of the Governor, 1978); V.I. Department of Commerce,Economic Review (St. Thomas: V.I. Department of Commerce, 1978), 11.
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Domingo, J.O. Employment, income and economic identity in the U.S. virgin islands. Rev Black Polit Econ 18, 37–57 (1989). https://doi.org/10.1007/BF02717884
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DOI: https://doi.org/10.1007/BF02717884