Taxation and Agricultural Stagnation

  • M. H. J. Finch

Abstract

One of the most enduring general interpretations of Uruguay’s problems is that the economy has suffered from the effects of excessive and misguided government.1 The analysis to support such a view has frequently been unsophisticated, even reducible to the propositions that batllista Uruguay was socialist, and that socialism does not work. At a more serious level is the ‘misplaced modernity’ interpretation, which argues that the batllista edifice of state intervention in economic and social affairs was built on an economic foundation which was incapable of supporting the burden. It might thus be said that the freedom of the political system to develop urban-based redistributive policies penalised the rural sector, diverting away from it resources which were required for investment in a modern and dynamic agricultural economy. The most systematic presentation of such a view was published in 1930: Riqueza y Pobreza del Uruguay.2 This work tackled the central problem of Uruguayan underdevelopment, the stagnation and technical backwardness of the rural sector, and its anti-batllista view of the Uruguayan process threw down a challenge to those holding opposite or incompatible ideas which seems never to have been taken up. The second part of this chapter presents a critique of Riqueza y Pobreza. It is preceded by a general analysis of Batlle’s fiscal policy and the implications of it for the landowning class.

Keywords

Sugar Migration Maize Depression Income 

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Notes

  1. 2.
    Julio Martínez Lamas, Riqueza y Pobreza del Uruguay: Estudio de las Causas que Retardan el Progreso Nacional, (Montevideo: Palacio del Libro, 1930).Google Scholar
  2. 3.
    Speech to the Convention of the Colorado party, June 1925, reprinted in Antonio M. Grompone, La Ideología de Batlle, 3rd ed. (Montevideo: Editorial Arca, 1967) pp. 122–33.Google Scholar
  3. 5.
    Batlle, in ibid., p. 129. The basis of this scheme in the writings of Henry George is discussed in Luis Carlos Benvenuto, La Quiebra del Modelo, Enciclopedia Uruguaya no. 48 (Montevideo, 1969), pp. 152–3.Google Scholar
  4. 8.
    Submission of the Cámara Nacional de Comercio to the tariff study commission of 1898, quoted in Eduardo Acevedo, Notas y Apuntes; Contribución al Estudio de la Historia Económica y Financiera de la República Oriental del Uruguay, vol. II (Montevideo: El Siglo Ilustrado, 1903) p. 464.Google Scholar
  5. 16.
    Alberto Methol Ferré, Adonde Va el Uruguay? (Montevideo, 1958) p. 11.Google Scholar
  6. 35.
    David Ricardo, The Principles of Polítical Economy and Taxation (London: Dent, Everyman’s Library, 1973), p. 132; Martínez Lamas, Riqueza y Pobreza, pp. 325–30.Google Scholar
  7. 39.
    Speech to the Congreso de las Sociedades Rurales del País, October 1939, reprinted in Pedro Cosio, Doctrinas y Hechos Económicos (Montevideo, 1940), p. 30.Google Scholar
  8. 40.
    This account of the evolution of exchange rate policies in the 1930s is based on Raúl Ochoa, ‘Contralor de Cambios en el Uruguay’, Revista de la Facultad de Ciencias Económicas y de Administración, year 4, no. 5 (1943) 215–529; Carlos Quijano, Evolución del Contralor de Cambios en el Uruguay (Montevideo, 1944); Santos Ferreira, ‘Antecedentes y Naturaleza Financiera del Ingreso Cambiario en el Uruguay’, Revista de la Facultad de Ciencias Económicas y de Administración, no. 7 (1954).Google Scholar
  9. 41.
    Eduardo Acevedo Alvarez, La Gran Obra de los Poderes Constitucionales Frente a la Crisis (Montevideo, 1934) pp. 105–27; Millot, Silva and Silva, Desarrollo Industrial, pp. 63–5.Google Scholar
  10. 43.
    F. H. Schott, The Evolution of Latin American Exchange Rate Policies Since World War II (Princeton Essays in International Finance no. 32, 1959).Google Scholar
  11. 44.
    R. Mexigos, Los Subsidios en Finanzas Públicas, (Montevideo: Instituto de la Hacienda Pública, 1958).Google Scholar
  12. 50.
    Carlos F. Díaz Alejandro, Essays on the Economic History of the Argentine Republic (New Haven and London: Yale University Press, 1970).Google Scholar
  13. 69.
    Raúl Vigorito, ‘En Torno a las Praderas Artificiales’, Instituto de Economía, Estudios y Coyuntura 1 (Montevideo, 1970) esp. p. 130.Google Scholar

Copyright information

© M. H. J. Finch 1981

Authors and Affiliations

  • M. H. J. Finch
    • 1
  1. 1.University of LiverpoolUK

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