{"id":109575,"date":"2018-04-23T12:00:04","date_gmt":"2018-04-23T11:00:04","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=109575"},"modified":"2018-04-20T11:01:15","modified_gmt":"2018-04-20T10:01:15","slug":"banking-on-a-shithole-us-led-racial-capitalism-in-haiti-began-long-before-trump","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2018\/04\/banking-on-a-shithole-us-led-racial-capitalism-in-haiti-began-long-before-trump\/","title":{"rendered":"Banking on a \u2018Shithole\u2019: US-Led Racial Capitalism in Haiti Began Long Before Trump"},"content":{"rendered":"

\u201cHaiti was \u2018truly a virgin territory ready for the white man\u2019s guiding mind.\u2019\u201d<\/em><\/p><\/blockquote>\n

\"\"<\/a><\/p>\n

18 Apr 2018 – <\/em>Donald Trump\u2019s recent description of Haiti, El Salvador, and Africa as \u201cshithole countries [sic]\u201d offered an ugly example of how US foreign policy is often shaped by the dictates of racial capitalism — by an economic system suffused with racial ideology and racist thinking.<\/p>\n

The comment recalls an earlier episode of racial capitalism in Haiti which is depicted in my book Bankers and Empire: How Wall Street Colonized the Caribbean.<\/em> On that occasion, however, the comments came from Wall Street rather than Washington, as part of the National City Bank of New York\u2019s efforts to secure control of Haiti\u2019s finances and banking.<\/p>\n

City Bank\u2019s push into Haiti proceeded via investment in the currency-issuing Banque Nationale (Republique d\u2019Ha\u00efti, 1914 emission)<\/p>\n

The history of Citigroup in Haiti<\/strong><\/p>\n

Founded in 1812, City Bank is the predecessor of the contemporary multinational investment-banking and financial-services corporation Citigroup Inc. By the beginning of the twentieth century, its managers were seeking to transform it from a successful domestic commercial bank into an international financial institution that could compete with the dominant European banking houses.<\/p>\n

Haiti was one of the earliest targets for City Bank\u2019s internationalization. This was part of a wider push into Latin America and the Caribbean that found support in the State Department. The US was then pursuing a policy of \u201cdollar diplomacy,\u201d attempting to use financial muscle to bring political stability to the region. City Bank\u2019s initial investments in Haiti came through their participation in the financing of dock and railway projects in 1910. They used these initial investments as a springboard to take over control of Haiti\u2019s economy and financial system, especially through the Banque Nationale d\u2019Haiti, a privately run bank of issue controlled by French and German interests.<\/p>\n

\u201cThink of it — niggers speaking French!\u201d<\/em><\/strong><\/p><\/blockquote>\n

As City Bank\u2019s investments in Haiti and the Banque Nationale increased, so too did their involvement in Haiti\u2019s internal affairs. City Bank managers became critical liaisons for the State Department regarding Haiti\u2019s politics during a period when the country was roiled by internal factionalism and disruptive pressure from French, German, and US political and business interests.<\/p>\n

City Bank managers Roger L. Farnham and John H. Allen were critical in this regard. At one point, Allen was called to a meeting at the State Department by William Jennings Bryan and asked to explain Haiti\u2019s history and current political climate. Allen described a country whose citizens were the descendants of formerly-enslaved Africans but whose culture was heavily influence by France. \u201cDear me, think of it!\u201d Bryan allegedly exclaimed in response, \u201cNiggers speaking French!\u201d<\/p>\n

Registers of racial disdain <\/strong><\/p>\n

Bryan\u2019s comments were not unusual. Not only did they reflect the sentiments about Haiti held by most Americans at the time, they also spoke to particular registers of disdain for the country within City Bank itself. Indeed, for Allen, Farnham, and other City Bankers the population of Haiti, like that of much of the Caribbean and Central America, constituted an inferior race whose biological impediments were compounded by the climate-induced degeneracy and torpor of the tropics.<\/p>\n

In his dispatches from Haiti, Allen oscillated between describing Haitian people as unbridled savages and innocent but ignorant children. As he once wrote in the City Bank journal The Americas:<\/em><\/p>\n

\u201cHaiti\u2019s dark millions can be a menace to the United States, but under wise and thoughtful guidance can be developed into a self-respecting and dignified nation that could perhaps help in the solution of one of the greatest problems before us today, the future of the colored race.\u201d<\/p>\n

\u201cFarnham described the Haitian masses as \u2018nothing but grown-up children.\u2019\u201d<\/em><\/strong><\/p><\/blockquote>\n

Haiti, according to Allen, was \u201ctruly a virgin territory ready for the white man\u2019s guiding mind to help it to get back to the conditions existing when, as history tells us, Haiti was the richest of all the colonies of France.\u201d Farnham described the Haitian masses as \u201cnothing but grown-up children.\u201d Like Allen, he believed that Haiti\u2019s regeneration could occur through the paternalistic tutelage of the US, that black self-government could only occur through white intervention. The Haitian people, Farnham stated, \u201cmust be taught.\u201d<\/p>\n

For City Bank in Haiti, racial designations guided financial considerations and economic policy was embedded in racist ideology. Such considerations, and the belief in the power of \u201cthe white man\u2019s guiding mind,\u201d undergirded a memorandum on Haiti that Farnham wrote for Secretary Bryan in 1914. Known as the \u201cFarnham Plan,\u201d it argued that Haiti\u2019s internal political conflicts could only be settled by the takeover of the country by a stronger nation and that such a takeover would be welcomed by the majority of the Haitian people given that they were used to strong-men in power.<\/p>\n

The coalescence of US economic and political interests<\/strong><\/p>\n

While the Farnham plan was a call for US military intervention based on racial paternalism, it was also a means through which the US military could be used to protect City Bank\u2019s financial and commercial interests in Haiti. City Bank worked to make intervention inevitable. They used the Banque Nationale to manipulate the price of the gourde, Haiti\u2019s national currency, withheld public salaries, and starved the government of its operating budget.<\/p>\n

In 1914, in what was seen as a deliberate challenge to Haiti\u2019s sovereignty, the bank ordered the transfer of Haiti\u2019s gold reserve from the vaults of the Banque Nationale to Wall Street aboard a US gunship. By 1915, Haiti\u2019s sovereignty was extinguished entirely when the Farnham Plan was effectively enacted with the landing of US Marines, an action justified in terms of Haiti\u2019s internal political turmoil, the supposed threat of Germany in the Caribbean, and a desire to protect US interests.<\/p>\n

The US military occupation of Haiti acted as a guarantee on the City Bank\u2019s investments in the country. By 1922, French and German interests in the Banque Nationale were eliminated and it came under the total control of City Bank. Customs collection was regularized, ensuring bond payments on the bank\u2019s railroad and dock projects, while the political risk to investors on the bank\u2019s $30 million loan to the country was eliminated. Farnham, in particular, benefited from the occupation, receiving a substantial payout and annual salary as the receiver of one of Haiti\u2019s railroads.<\/p>\n

\u201cHaiti\u2019s sovereignty was extinguished entirely when the Farnham Plan was effectively enacted with the landing of US Marines.\u201d<\/em><\/strong><\/p><\/blockquote>\n

While one City Banker described Haiti as \u201ca small but profitable piece of business,\u201d such profits came at great cost to the Haitian people. Their business was written in a ledger of violence: in the brutal suppression of a series of peasant insurgencies that left dozens of villages burned, thousands of Haitians dead, and hundreds more jailed or forced to work on chain-gangs that recalled the days of slavery.<\/p>\n

The occupation lasted nineteen years (until 1934) and only ended because of a country-wide protest movement and adverse publicity for City Bank in the US. While the Marines were withdrawn in 1934, the Banque Nationale remained under the direct control of City Bank until 1941, when it was sold to the Haitian government for $500,000. Yet even after 1941, Banque Nationale continued to be managed by City Bank appointees, and City Bank continued to act as its international correspondent bank.<\/p>\n

Racial ideology and economic policy in Haiti and beyond<\/strong><\/p>\n

City Bank\u2019s history in Haiti shows how imbrication of racial ideology and economic policy can occur. It also suggests that finance capital is embedded in cultural and racial discourse \u2013 that banking and investment are constituent parts of racial capitalism.<\/p>\n

This is not limited to Haiti. Such questions shaped City Bank\u2019s engagements in Cuba, the Dominican Republic, Puerto Rico, and Panama — but also in \u201cwhite\u201d countries like Argentina. Nor was it limited to City Bank. Similar considerations were at work in Chase Manhattan\u2019s engagements with Cuba and Panama and those of Brown Brothers in Nicaragua. Indeed, Nicaragua was described as the \u201cRepublic of Brown Brothers\u201d in the 1920s due to its degree of control, with the manager of one of its subsidiaries there, W. Bundy Cole, commenting, \u201cI do not think any Indian or any negro is capable of self-government.\u201d<\/p>\n

\u201cNicaragua was described as the \u2018Republic of Brown Brothers\u2019 in the 1920s.\u201d<\/em><\/strong><\/p><\/blockquote>\n

Trump\u2019s \u201cshithole countries\u201d comment continues this long tradition of entangling racial denigration and economic policy. It came in the midst of an ongoing and contentious national debate over citizenship, economics, race, and immigration, and it was followed soon after by an announcement barring Haitian citizens from visas for agricultural laborers and temporary workers.<\/p>\n

But if Citigroup\u2019s recent takeover of Puerto Rican debt and public utilities in the wake of Hurricane Maria is any indication, investing in shithole countries remains just as lucrative for Wall Street as it has been for centuries.<\/p>\n

________________________________________<\/p>\n

Dr. Peter James Hudson is assistant professor of African American Studies and History at the University of California, Los Angeles (UCLA), and author of <\/em>Bankers and Empire: How Wall Street Colonized the Caribbean (University of Chicago Press, 2017).<\/em><\/p>\n

Go to Original \u2013 blackagendareport.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

18 Apr 2018 – Donald Trump\u2019s recent description of Haiti, El Salvador, and Africa as \u201cshithole countries [sic]\u201d offered an ugly example of how US foreign policy is often shaped by the dictates of racial capitalism — by an economic system suffused with racial ideology and racist thinking. The comment recalls an earlier episode of racial capitalism in Haiti.<\/p>\n","protected":false},"author":4,"featured_media":109576,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[53],"tags":[],"class_list":["post-109575","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-latin-america-and-the-caribbean"],"_links":{"self":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/109575","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/comments?post=109575"}],"version-history":[{"count":0,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/109575\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media\/109576"}],"wp:attachment":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media?parent=109575"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/categories?post=109575"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/tags?post=109575"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}