Abstract
Between the late 1970s and the 2000s, the Guatemalan sugar industry transitioned from a production model with deplorable labor conditions and low productivity to a highly efficient model with improved conditions. This paper traces the origin and diffusion of this upgraded model to a small team of managers motivated by Elite Solidarism, an interpretation of the Vatican II Catholic Social Doctrine. It suggests that this ideology played the central causal role in this process of industrial transformation, as managers drew upon it to define the specific practices of the new model at one particular mill and then encouraged its diffusion.
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Notes
For examples of studies on the role of the state, see Amsden (2003) and Evans (1995). On developmental business associations, see Doner and Schneider (2000). On global value chains and clusters, see Gereffi (1999), Humphrey and Schmitz (2002), Nadvi and Halder (2005), and Navas-Aleman and Bazan (2004).
For an overview of some of the central arguments in the ideational literature of political science, see Schmidt (2008).
Paige (1975, 1997) provides an example of the possible effects of society-wide changes. According to his theory, as a society's non-cultivators shift their main source of income from the land to capital, they become economically stronger and more willing to negotiate with contenders, thereby reducing the possibility of violent conflict. Interestingly, while some change in the source of income of non-cultivators may have taken place in Guatemala, the divergence in the outcomes of the three main agro-industries in the country—cotton, coffee, and sugar—challenges the explanatory power of this theory's emphasis on society-wide changes.
To obtain statistical information, I visited the National Institute of Statistics (INE), the Central Bank (BANGUAT), the Guatemalan Library of Congress, and the mill association's headquarters.
They exported the remainder to the lower-priced international spot market.
Families settled in small sections of the cramped galleys, sleeping on the floor and setting up makeshift walls out of plastic or cloth. In only a few cases did cement walls or floors protect workers from malaria, polluted stagnant water, flies, and insecticides. Most of these galleys lacked electricity or running water (Bossen 1982; Figueroa Ibarra 1980; Molina Calderon 2005; Oglesby 2002; Valdez and Monzón 2007; Wagner 2007).
Most union members worked as mill operators, although permanent year-round field workers and supervisors also participated in the union. Their commonalities—essentially their permanent worker status and claims to mill land—held these different worker groups together in the unions.
Similar problems affected other sugar industries. For an example, see Doner (2009).
This outcome challenges Paige's (1975) theory, described previously. The growing power of the capital-based non-cultivators was associated with active repression of mill unions rather than the increased openness to negotiation that Paige's theory predicts.
According to Smith (1975), “the Paulo Freire method of conscientization, [combined] Biblical themes of Exodus and liberation with techniques for self-determination and community organization” (p. 9).
Dulles (1987) explains that, under this model, “The Church is not conceived as a democratic or representative society, but as one in which the fullness of power is concentrated in the hands of a ruling class that perpetuates itself by cooption” (pp. 30–31).
Five students from this class entered Tajumulco. One student a year older and another 2 years younger also entered in this first cadre of Saint Ignatius-educated managers.
The Cursillos appear to have become radicalized over the few years that they lasted, as frustrated mentors and students increasingly abandoned Elite Solidarism for Liberation Theology. According to one interviewee, after parents complained and withdrew their children from the schools, school directors closed down the Cursillos. Soon after, the military governments of Guatemala would also deport some of the leading foreign Cursillo mentors (e.g., Marjorie Melville was expelled in 1968).
Melville and Melville (1971) echo this anti-Communist bent of the Cursillos.
Participants in the Cursillos followed different paths. Melville and Melville (1971) recount how four graduates of the Maryknoll's Heart of Mary left their privileged Guatemala City life to teach in an indigenous community in the highlands. Others joined Jesuit and Maryknoll missions working with producer cooperatives. Still, other participants joined the revolutionary movement.
As one manager put it: “We had been trained with this style of management of our subordinates very oriented toward social justice… We have been pioneers in the sugar industry, first in the labor changes… then we were at the vanguard” of production changes (personal communications with managers, 2010).
The fourth class to graduate from Saint Ignatius followed different paths after graduation (importantly, not all of them participated in the Cursillos). Of the 29 graduates, 5 entered the engineering department of the national university and then the sugar industry; 5 joined Jesuit training (only one completed the training to become a member of the Jesuit order); at least 4 also entered the national university but graduated as doctors and architects (1 of the doctors and 1 of the architects then worked closely with the sugar industry); at least 1 joined the guerrilla and died in the civil war; and at least 2 actively participated in politics (former President Oscar Berger (2004–2008) and Vice President Eduardo Stein (2004–2008), whose government employed a number of individuals associated with the sugar industry).
According to Espeland, for these engineers “transforming nature was a way to complete God's work; it was a testimony to one's faith, creativity and skill… Nature was conceived as an unfinished product; as raw materials provided by God, nature required man's intervention” (pp. 411–412). In addition to Christian theology and an engineering ethos, Espeland also points to “myths about Western settlement” as influencing the ideology of these engineers.
Similarly, other young, urban-based individuals had previously been employed at the mills (Molina Calderon 2005), but the sense of mission set the new managers apart.
Nor did the Guatemalan state bureaucracy enjoy the necessary embedded autonomy to promote upgrading (Evans 1995). Rather, adversarial business–state relations characterized most of the 1970s and 1980s as the military increasingly sought to wrest control of economic policy from the traditional business sector (Dosal 2005; Valdez and Palencia 1998). Such friction extended to the sugar industry (personal communications with the manager, June 8, 2010). As a result, the state provided the sugar industry with none of the developmental support policies documented elsewhere (Amsden 2003; Evans 1995; Kohli 2009). Protective tariffs constituted the sole exception, but these created no comparative advantage insofar as all other sugar-producing nations similarly protected their industry.
At the time, these buyers focused on purchasing raw sugar.
The following quotes evince managers' view of themselves as agents of change, often facing ignorant or even immoral opposition: “We had to teach these people how to be clean, how to brush their teeth…” “We had to teach [cane cutters] how to eat with glasses, forks, plates.” “There was terrible promiscuity… so we said to the [male] worker, ‘now you'll come work by yourself and you can send your money back to your woman.’” “At the time there were all those movements, socialists, communists, that went against what we were doing… but they themselves came to realize that what we were doing [was beneficial] and then they would even defend us.” Managers also claimed that, once the union weakened, leaders took money, abandoned their followers, and flew to Italy (personal communications with managers, 2010).
An interviewee who participated in the “Cursillos” and then joined the guerrilla movement corroborated the managers' denials. This interviewee, who also served as one of the main organizers for a massive cane cutter strike in 1980, laid the blame for the human rights abuses squarely on the shoulders of the older generation of mill owners and managers (personal communications with a former CUC organizer, August 9, 2010).
A fourth unionist reappeared later.
The CUC had strong ties to the guerrilla organization, Ejército Guerrillero de los Pobres (EGP). In fact, one of the main organizers of the strike, whom I interviewed, also participated in the EGP. At the same time, the strike was not necessarily driven only by military imperatives—as some mill owners and managers were quick to argue—but by the appalling labor conditions on sugar, cotton, and coffee plantations.
A member of the guerrilla movement who also studied in a Catholic high school described how “that harvest struggle” had “an enormous psychological impact on the Guatemalan bourgeoisie… Since we were kids and for generations they have told us, ‘when the Indians raise their machetes…’ And then I saw [a picture of the strikers] and said to myself, ‘now [the bourgeoisie] shat themselves’ as they did, in fact, shit themselves…” (personal communications with a former guerrilla member, July 29, 2010)
See Molina Calderon (2005) for a description of this approach at one of the industry's mills. Most generally, the approach involved deep cuts in mill employment and sugarcane purchases.
DiMaggio (1988) describes champions as a set of individuals spearheading institutional diffusion.
This finding echoes Cammett's (2005)argument that “ideas do not spread spontaneously” and “collective action… is never assured.” Instead, leaders must promote them. Furthermore, in fostering collaboration, leaders can “revitalize” existing organizations.
Scott (2008) defines theorization as “a formulation of why and how the innovation is effective and an identification of the class of problems or organizations for whom it is suitable” (p. 126).
The manner in which managers in Guatemala recast this set of practices, initially motivated by Elite Solidarism, in purely efficiency terms, bears a striking resemblance to Dobbin and Sutton's (1989)description of the firm-level consequences of the “Rights Revolution” in the USA. They argue that, while the different legal requirements of this Revolution stimulated firms to establish different offices to manage compliance, firm middle managers later “reconstructed these departments as components of human resource management and articulated theories of how each contributed to productive efficiency” (p. 455).
According to Tolbert and Zucker (1996), objectification “involves the development of some degree of social consensus among organizational decision-makers concerning the value of a structure, and the increasing adoption by organizations on the basis of that consensus” (p. 182).
Tolbert and Zucker (1996) argue that when sedimentation has occurred, typifications are transmitted to new members of organizations “who, lacking knowledge of their origins, are apt to treat them as ‘social givens’” (p. 181).
For example, one young mill owner explained that “the fact that we transformed the worker who came with his family into a worker who must be an adult, who receives adequate nourishment, all the protections of the law and health services… that has a cost, but workers perform better and that lowers your production costs, and over time it's beneficial for us.” A middle-aged manager at another mill echoed similar arguments: “When I arrived in the sugar industry 27 years ago [in 1983], the conditions in which cane cutters lived were infrahuman… But administrators and mill owners realized that if they had their worker well fed, he would be more efficient and produce more” (personal communications with managers, June 7, 2010 and June 9, 2010).
See Wagner (2007) for examples of the innovations developed at different mills.
If an agro-industry in Guatemala seemed poised for a transformation in the early 1970s, it was the cotton industry. Receiving significant support from the state, cotton production boomed throughout the 1950s, 1960s, and early 1970s. However, as in the sugar case, international prices for cotton collapsed in the late 1970s and early 1980s, and the industry faced labor mobilization. However, unlike the sugar industry, it never recovered from these shocks and by the late 1980s few producers remained. For more on the cotton industry, see Williams (1986).
They argue that “managers in highly visible organizations may have their stature reinforced by representation to participate in the boards of other organizations, participation in industry-wide or inter-industry councils, and consultation by agencies of government” (DiMaggio and Powell 1983, p. 153)
He illustrated his argument by referencing the role of Saint Simonian ideas in France under Napoleon III, when the country industrialized under the aegis of a “well-defined group” of Saint Simonian socialists in “positions of economic and financial influence…” (p. 23). Drawing from their shared Saint Simonian views, this group crafted a unique trajectory of industrialization that privileged large banks, such as the Credit Mobiliere, as the “institutional instruments” supporting industrial transformation in France.
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Acknowledgments
I would like to thank Richard Locke, Michael Piore and Ben Schneider for their copious feedback and consistent support. Thanks are also due to the numerous interviewees who shared their experiences and ideas despite the cloud of distrust that so often envelops Guatemala. I am also grateful for comments from Judith Tendler, Susan Silbey, Seth Pipkin, Matthew Amengual, Paul Osterman, Andrew Schrank, Mauro Guillen, participants in the Institute for Work and Employment Research (IWER) workshop at MIT Sloan, as well as the anonymous reviewers from Studies in Comparative International Development. Responsibility for errors is my own.
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Fuentes, A. A Vocation for Industrial Transformation: Ideology, Organizational Isomorphism, and Upgrading in the Guatemalan Sugar Industry. St Comp Int Dev 49, 370–401 (2014). https://doi.org/10.1007/s12116-013-9142-y
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DOI: https://doi.org/10.1007/s12116-013-9142-y