Latin America, Depression, and WWII (1929-1945)

During the Great Depression, Latin America utilized the absence of economic imperialism to adopt Import-Substitution Industrialization (ISI). This significantly lessened the impact of the Depression.
Latin American countries started to diminish the influence of the United States, which transitioned from the "Big Stick" policy to the "Good Neighbor Policy."
Without U.S. dominance, Latin American countries developed their own economic systems and governments with varying degrees of success.

ISI is crucial for understanding Latin America during the interwar years and WWII.

ISI is the process where Latin American countries filled the void left by the USA/European countries during the Great Depression.
It's a policy that encourages replacing foreign goods/imports with domestic production.

Governments controlled the economy by:
- Setting wages & prices
- Manipulating exchange rates
- Passing labor laws
- Owning public works projects

Larger countries like Brazil and Argentina benefited most due to their economic strength.
Initially, light goods such as soap, beer, and shoes were primarily impacted.
Heavy goods were not developed significantly.

Brazil did not suffer the same economic effects as Europe during the Interwar years.
There are political similarities to Europe.
Getulio Vargas in Brazil is a prime example.

Brazil underwent a "revolution" in 1930.
President Washington Luis left power, predominantly nonviolently.
The Brazilian government subsidized the coffee industry, which collapsed during the Depression.
Getulio Vargas, a Populist, seized power after a disputed election.
The 1st Vargas Presidency is divided into three phases:
- Provisional Government (1930-1934)
- Constitution & Presidency (1934-1937)
- Estado Novo (1937-1945)
Vargas was legally elected during the second phase of his 1st presidency and again in 1951.
He remained in office until his suicide in 1954.

Means "the new state," named after the Portuguese dictatorship.
By 1934, Vargas began employing fascist tactics, such as curtailing press freedoms, to maintain power.
He won the 1934 election by positioning himself against communism.
He centralized authority in Rio, implementing a command economy.

Latin America was initially seen as unimportant but fell under Axis influence economically, socioculturally, and politically.
Proximity to the United States and the eventual understanding that the Allies would win the war caused countries like Brazil, Mexico, and Argentina to support the Allies.
This support, particularly in natural resources, was crucial to winning the war.
It also allowed those countries to have more of a say in the post-war order.
The result of which would lead to increased interference in the affairs of the rest of the Americas by the United States after the war.

Before WWII:
- Argentina had a significant German and Italian population.
- Estimated 2/3rds of Argentinians have Italian ancestry.
- Buenos Aires is more ethnically European than London.
- Japan invested in the west coast of South America.
- Many Japanese had gone to South America do combat growing US racisms. The largest population is in Brazil, but most cultural influence is in Peru.
The USA knew of this and frequently discussed Latin America in armed forces meetings from 1939-1941.

Infrastructure was lacking outside of cities.
German aeronautical companies invested in civilian travel, establishing the first carrier in South America (SCADTA) by late 1919.
Airfields emerged throughout Latin America due to German investment.
By 1939, 90% of Latin American air travel was based around Axis investments.
This helped evade the British blockade of Germany.

The era between WWI and WWII marked a major shift from coal to oil.
The Axis, especially Japan, lacked sufficient oil.
Mexico had the largest oil reserves in Latin America.
In the 1920s, Mexico was second in the world in oil production behind the United States.
Most of Mexico's oil was owned by foreign corporations.

President Lázaro Cárdenas nationalized oil companies, leading to conflict.
The Calles-Morrow Agreement grandfathered in state ownership.
Mexico sold oil to the Axis, allowing them to nationalize the industry.
Germany and Italy secured 94% of Mexico’s oil export between March 1938 and Sept 1939
The US eventually bowed to nationalization due to Pearl Harbor.

Rubber became vital for war.
The Japanese invasion of Indonesia/Malaysia ended 90% of the Allies' supply.
The US looked to the Amazon for rubber.
Plan Rubber and the Washington Accords were created.
Brazil dropped its neutrality, hoping for a prominent post-war role.
The Accords allowed the US to build airfields & rubber plantations in Brazil.
Brazil encouraged poor & indigenous workers to move à led to mass deaths (60% death rate) & poor working conditions, but supplied 85% of Allied rubber until a more synthetic advancement could be mass produced in late 1943

There is a long history of Jews in the Spanish New World.
They were technically not allowed but still immigrated.
After the revolutions, many officially accepted Jews as immigrants.
Argentina became a popular destination.
Latin America generally restricted Jewish immigration in the 1930s and 40s due to nationalist and far-right groups.
Historical culture of Christianity and conservativism bred unfamiliarity and fear.
ex: Vargas used us vs. them mentality to isolate Brazil’s Jews, claiming their Communists.

FDR tried to convince Latin American, but only Trujillo in the Dominican Republic accepted Jewish immigrants (to "whiten" his population).
Lack of any serious want of the Jews or help for them gave Hitler green light for genocide
Vargas and other Latin American dictators were into Eugenics as a way to continue social marginalization of natives
In Puerto Rico, 1/3 of all women were sterilized between 1936-1960

Latin America’s siding with the Allies led to increased anti-colonial influence in the post-war order.
The Catholic Church organized covert operations (Ratlines) to help Nazis escape to Latin America.
Approximately 10,000 Nazis eventually made their way to Latin America over the next 20 years.