what it should be and may appear a bit startling to our notions of
propriety. In Peru, there is a mineral water known as “Jesus Water,” the
labels on the bottle, the colored posters and other advertising showing
Christ at the spring.
A cognac company uses cuts, posters and large signs depicting the
Saviour in the act of pouring out a glass of brandy and saying to
Lazarus, lying in a coffin at his feet, “Lazarus, arise and take a glass
of Cognac Bisquit.” I have seen this announcement in colors on the back
page of the leading illustrated weekly.
“You Furnish the Corpse and Do the Mourning—We Do the Rest,” is the
ingenious slogan announcing the advertisement of an undertaking firm.
Let me add that such advertisements are not considered sacrilegious or
brutal, but simply show how primitive conditions are in these fields.
Doctors advertise patients and patients advertise doctors in these
favored lands of the sun. This is considered perfectly ethical and adds
to rather than detracts from the reputation of both parties. I recall a
picture in halftones in the leading weekly of South America showing the
photographs of a physician and his patient, a well known lady of the
city. Grouped between the two were reproductions of forty-eight stones
alleged to have been removed from the sufferer. Pictures of amputations
are shown in detail, with lifelike illustrations of the surgeon.
Executions are also minutely depicted. I mention these facts in order
that a more complete insight may be gained as to the advertising
disposition and temperament of the public.
[Illustration:
Chilean Infantry
“To see some of these troops march past with their peculiar knapsack,
their goose-step and the pickelhaub helmet, makes one feel that one
is in Germany.”
_See page 220_
]
[Illustration:
De venta en los buenos establecimientos
“Local copy in many sections of Latin America is far from our idea of
what it should be and may appear a bit startling to our ideas of
propriety.... A cognac company uses cuts, posters and large signs
depicting the Saviour in the act of pouring out a glass of brandy
and saying to Lazarus lying in a coffin at his feet, ‘Lazarus, arise
and take a glass of cognac!’”
_See page 339_
]
Position in the greater number of papers is an unknown quantity and its
value little understood or appreciated. Those connected with the journal
positively do not realize its importance. Even if a definite location is
contracted for in your agreement you need not be surprised if the
advertisement appears anywhere on any page. This is not done to
antagonize you, but is due to the fact above mentioned. Attempts to
deduct for wrong position in making payments generally start all kinds
of trouble and result in caustic editorial comments. Here as in all
things in Latin America, friendship counts, and if you have taken the
precaution to get on the right side of the editor and the make-up man,
you can have your choice of positions. I know of a representative who
was advertising a well known American mineral water in South America
three years ago. One of the dailies in which he was doing much display
work had just added a new two-color press to its equipment and as he was
very intimate with the editor the advertisement appeared in red ink for
a long time in the center of the front page along with the foreign
telegraphic news, columns being broken for the purpose. No extra charge
was made for the service and the owner of the sheet felt that he had
done nothing more than exhibit his high regard for the gentleman from
the North.
Before preparing your copy for Latin America it is well to study all
these conditions and see wherein you can take advantage of them for
there is no denying that peculiar opportunities exist which if profited
by may mean for you and your firm success in this territory.
Once you have decided upon your copy and the size of the space you
intend using, it is advisable to have electro cuts made. This saves time
and insures for your advertisement a uniformity of text and type which
cannot be guaranteed if the same is to be set up in the office of the
paper for each issue. When these electros are to be used in rotation
they should be numbered and printed instructions for the foreman should
accompany them.
[Illustration:
South American appreciation of advertisements “made in U.S.A.”
“They recognize Americans as the best advertisers in the world and not
being familiar with English appropriate and use our illustrations
irrespective of the fact that they have absolutely no bearing on
what they are advertising.”
_See page 343_
]
Plagiarism is rampant. They recognize Americans as the best advertisers
in the world and not being familiar with English appropriate and use our
illustrations irrespective of the fact that they may have absolutely no
bearing on what they are advocating.
Typical of this purloining I recall a well known picture from an
American cereal advertisement showing two men seated in a dining car,
eating breakfast food. Outside snow is all over the ground and trees;
“Smoke El Toro Cigar” is the announcement beneath the sketch and in no
place does a cigar appear or is any reference made to one. Whoever
selected this picture did not even have the good judgment to modify the
same to the extent of cutting out the snow storm, in a land where snow
is unknown or eliminating the raised spoons piled high with the cereal
and held in the hands of the travelers.
The full page advertisements of Pillsbury’s Flour were bodily
appropriated and used by a local cement manufacturing concern. The fact
that they also put up cement in bags seemed enough to warrant them in
using this copy, although the picture of the cook surrounded by the
paraphernalia of his office was not altered in the least.
XXVIII
RECIPROCITY
Foreign trade to be permanent should be established on a reciprocal
basis. To expect to ship a nation your raw or manufactured materials,
receiving only in exchange therefor a monetary consideration, is neither
equitable, sensible nor practical. It is decidedly lacking in business
judgment and reflects on the sincerity of the country endeavoring to do
its trade along such lines.
Perhaps the chief reason that European Powers have obtained such a
foothold in foreign markets is due to the fact that they take in
exchange much of the crude exports of these lands and convert them into
finished factory products. This from an economic standpoint is as it
should be. It gives employment to the citizens of the importing nations,
develops and maintains their merchant marine, necessitates less material
movements in the medium of exchange in payment for goods on the part of
those concerned in the transaction and more firmly entrenches each in
the other’s business and friendly relations.
The various countries comprising Latin America are in no sense
manufacturing ones. They possess few if any factories or plants and
these are usually devoted to the perfection of some local necessity,
such as wines, cigarettes, cigars, soap, sugar, and other articles for
personal use or consumption. They are however the largest producers of
raw materials the world knows. Due to our shortsightedness as a nation,
we have allowed the European merchant and manufacturer to take these
products from Nature’s laboratory, elaborate the finished article
therefrom and during each stage of its perfection, from its origin to
its completion, we have paid a profit, not to one, but to several
enterprising foreigners.
The Latin Americans—in fact no nation—will buy from us for sheer love or
their high regard for us as a people, or even from dire necessity for
that matter. Most of these countries achieved their independence from
Spain because they refused to be further exploited by the mother
country. It behooves us as modern and liberal minded, wide-awake
business men, to develop our trade in these territories so that our
exports to each country will be paid for by the things which we import
from it. This is not a difficult problem to solve, especially as at the
present time our imports from them exceed the value of our exports to
them by approximately $100,000,000 yearly. This sum should represent the
amount of trade expansion with the United States these countries will be
in a position to stand on a reciprocal basis.
Another feature in this connection which has developed since the
beginning of the present war is the monetary situation in Latin America.
These countries as the world knows were borrowing nations, and
practically dependent upon Europe for all of their financing. To-day
Europe cannot aid them in this respect and they have turned toward us
for assistance, thereby placing us in a much more advantageous position
than we formerly occupied with relation to developing our trade along
reciprocal lines, for a lending nation can always dictate to the
borrowing one.
Following the stringency in the European money markets and their
inability to lend further financial aid to Latin American enterprises,
there has been a decided slump in property values of all kinds, thereby
giving the American investor desirous of entering these fields an
excellent opportunity to acquire controlling interests at the minimum
expense in undertakings which will ultimately rehabilitate themselves as
money making propositions. These conditions should not be lost sight of
during the readjustment of values in this part of the world.
To be more specific, perhaps 80 per cent. of the world’s supply of
bismuth comes from Peru. This metal is largely used in the arts and
medicine. An Italian company owns practically all the mines. Germans and
English buy the ore and ship it to their respective clients in Europe.
On its arrival it is sold to smelters which produce the metal therefrom.
Manufacturing chemists purchase this and convert it into the bismuth
subnitrate used so extensively by the physician of to-day. This product
is imported by the American drug broker who sells it to the jobber,
whose traveller in turn disposes of it to the wholesale chemist through
whom it reaches the local druggist and finally the consumer. It is safe
to say that fully 30 per cent. of the prescriptions written by the
doctor and compounded by the apothecary call for this drug. If the metal
is to be used in the arts it goes through as many hands before reaching
the ultimate user. It is not difficult therefore to see that from the
mine to the consumer there are six or seven profits made, several of
which might be eliminated, thereby reducing the cost of the article,
provided the ore was brought direct to this country and the reduction
made here. Furthermore instead of going around the Horn to Europe, the
freight through the Panama Canal to an American port would be much less,
consequently effecting a great initial saving. Why does not some
manufacturing chemical house take advantage of this opportunity?
This same condition of affairs is true of cinconah, from which quinine
is made, iodine, opium, belladona, menthol, castor oil, licorice,
linseed and many other extensively used and well known drugs. What a
chance exists in this field alone to establish a reciprocal trade, and
at the same time to reduce the high cost of these medicines!
Last year Bolivia sent to Germany and England 50,000 tons of tin. We
bought back 30,000 tons of this tin from the wide-awake Teuton and
Anglo-Saxon merchants, or expressed in figures we contributed more than
$16,000,000 to the bank accounts of these gentlemen. We are the largest
users of tin in the world and Bolivia is the second largest tin
producing country, with thousands of acres of unexploited tin fields yet
to be developed. It is about two-thirds as far again from Bolivia to
Europe as it is to the United States. With proper shipping facilities
and the use of the Canal or by going to California, the saving in
freight alone should be sufficient to interest some progressive concern
in the handling of this article direct.
Europe sends its wool buyers to Argentine and Uruguay. I have attended
these markets and have yet to meet an American buyer representing any of
our woolen cloth manufacturers. We buy much of our wool from European
markets, thereby giving Belgians, French, English and Germans who have
initiative and enterprise a profit on their business acumen. Is this
sensible? It only adds to what each one of us pays for our clothes.
Ecuador’s chief product is cocoa. It is the largest grower of this
commodity in the world. The bean is perhaps the richest and most highly
flavored and is in great demand in the trade. Europe buys 80 per cent.
of this article and although we are the biggest individual users of
chocolate on earth, our merchants purchase but 20 per cent. direct. Then
England and Germany, and even little Switzerland, turn around and sell
us back—at a profit of course—fifty per cent. of what they bought in
Ecuador. And we call ourselves merchants! Who exhibits the good judgment
in such a transaction?
The linseed of the world is produced by Argentine and India. The small
farmer trades it for supplies to the village merchant, who in turn
exchanges it for goods with the jobber in the capital or seaport. To
these men come the buyers for the Greek firm which practically controls
this industry and purchase the seed, and we, the most extensive users of
linseed oil in the world, pay our toll and tribute to the able and
shrewd men who have their headquarters in Athens. Isn’t there something
radically wrong here?
The alpaca gives a fine soft wool. Practically all of this material is
bought in Bolivia by Europeans who manufacture the cloth which they
afterwards sell us. I cannot understand why some sagacious American has
not entered this profitable market.
The seasons in the southern part of South America are reversed, so that
they have summer when we have winter, which means that their fruits and
vegetables, melons and berries are ripe when we have snow on the ground.
The apples, peaches, pears, plums, apricots, nectarines, cherries,
grapes and melons of Chile are as good as our own. A profitable return
awaits the one who will forward these goods in refrigerator ships to our
big northern markets.
In Colombia and Ecuador large quantities of _tagua_ or ivory nuts
formerly grew wild. They are about the size of a goose egg, or slightly
larger, very hard and a dead white, protected by a thin black skin. For
years no one knew what to do with them. Finally an enterprising German
found that they could be converted into buttons. To-day the ivory nut is
cultivated for this purpose, and forms one of the leading exports from
the countries named; the shipments for 1913 amounted to over $5,000,000.
The finished button is sold not only to the Latin Americans, but
throughout the world as well.
Brazil is the second largest diamond producing country in the world.
English companies have $50,000,000 invested in these mines, which means
that the diamonds obtained therefrom pass through the hands of several
Europeans before they ultimately reach the wearer in the United States.
One State of Brazil—Minas Geraes—has for the past six years been
exporting gold to Europe, sometimes as much as $2,000,000 a month,
because Germans, Belgians and Englishmen own the mines.
Chile contains the largest known deposits of “caliche”—that is, the
earthy material from which nitrate is made. This article is extensively
used in the arts, in the production of gunpowder and other high
explosives and also as a fertilizer. Last year she exported 50,781,241
quintals, the world’s total consumption for the same period of time
being 51,296,489 quintals. I know of but one American house established
in these fields. The business is controlled almost entirely by English
and German companies.
We should also make a more determined effort to finance municipal and
national improvements in these countries. The money lenders of Europe
have been quick to take advantage of such opportunities. They proved
good investments for them. We should also find them profitable, under
the right conditions. In this field there are and will be for years to
come great possibilities, especially in electric and gas plants,
electric and steam roads, water works, sewers, and sanitations, mines
and smelters. The benefits to be derived from such a source of
investment are only too obvious. They give our engineers and contractors
and all connected with such an enterprise an opportunity to force upon
these countries our products and methods, provide permanent employment
for many of our countrymen, who in return will create a demand for goods
made in America. England leads the world in outside investments of this
nature, having over $10,000,000,000 in various foreign lands,
$5,000,000,000 of which is in Latin America. The German long ago saw the
advantage of following in the footsteps of the Briton and is the second
largest investor in such enterprises abroad.
International bankers when making loans to private persons or
governments interested in these progressive movements always stipulated
that the materials to be used should be purchased from the country which
furnished the money for the development. This was a fair and far-seeing
business proposition and should serve as a guide for us in our future
dealings with these markets.
Chile to-day is spending $400,000,000 on harbor improvements and
fortifications, most of the work being in the hands of Europeans. The
plans contemplated will require many years to complete, and during all
this time European material will be used and workmen from the Old World
will derive profit from the undertaking.
An American first had the concession to build the subway in Buenos
Aires. He spent months trying to get capital in the United States
without success. Finally a German raised the money in Hamburg and now
everything about the line from the electrical installation to the
motorman and his uniform is “Made in Germany.” Being the first and only
underground road in Latin America it was written about and talked of
everywhere, and at all times the Germans got credit for the enterprise
and were well advertised as efficient and wonderful engineers. This was
another opportunity lost to us.
Before the European War started a syndicate of English, French and
Germans had agreed to expend $200,000,000 in Colombia building railways
and in making the Magdalena River, the only highway to the capital at
Bogota, navigable at all seasons of the year. Due to present hostilities
they had to abandon the project. The terms offered by Colombia were
excellent, including 5 per cent. interest on the capital and the further
provision that the government would ultimately within a specified period
take over the road, paying an exceptional profit to the original
investors. Here is an excellent opportunity for American capital to
develop a reciprocal market.
One of the chief reasons for the scarcity of invested American capital
in Latin America is the indefinite and indifferent attitude of our State
Department in failing to protect its citizens abroad or in seeking
redress for injuries done individuals or business conducted in these
countries.
No race of men are as enterprising or venturesome or more truly pioneers
in every sense of the word than we Americans. This trait is a natural
inheritance from our forefathers, who left comparatively civilized and
comfortable Europe to gain a livelihood in the wilds of unknown and
unexplored America. We are a practical people, also, and when through
years of trying experiences we became definitely impressed with the fact
that in our foreign ventures we had neither the co-operation nor the
protection of our government, very naturally we abandoned these tempting
fields of business and allowed them to be profitably tilled by the
citizens of European governments which sympathized with their subjects
in their efforts to develop trade and at the same time provided them
adequate protection of a substantial and impressive type.
In the early days which marked the European campaign for the commercial
supremacy of Latin America, most of these countries were the scenes of
much bloodshed and the violence of devastating revolutions. As a result
of the instability of their governments, there was positively little or
no security of life or property. Concessions solemnly made were
ruthlessly cancelled. Business ventures involving the outlay of immense
patience and large capital were completely wiped out. In brief the
foreigner in these lands was looked upon as an intruder and treated with
scant consideration. When Americans were involved in such occurrences,
our State Department, with very few exceptions, ignored the petitions of
the victims, until its neglect in this regard became so notorious that
finally no promoter had the temerity to seek capital in this country for
any Latin American enterprise. This condition of affairs had much to do
with turning the current of these ventures toward European money
markets, an opportunity eagerly accepted by all parties.
On the other hand, the European, whether prospecting in the snow-topped
mountains or uplands of Bolivia, or in the jungles of the Amazon, knew
that his government kept a watchful eye on him and encouraged his every
effort, first because this was the privilege and duty of a government
and secondly the success of the individual in these lands ultimately
meant prosperity for the nation. If he was robbed, imprisoned or
murdered, if the result of his years of labor was destroyed in national
or local uprisings, the warship would always materialize to emphasize
the collection of compensation when diplomacy failed.
Such consideration for their people on the part of the European
governments duly impressed the Latin American mind, and more so
especially when he was heavily taxed to reimburse the foreigner for
injuries received. As a result the European became respected more and
more from Mexico to Patagonia, and was allowed to pursue his way in
comparative peace, the converse of this proposition being true of the
unfortunate American, who could not expect governmental protection and
who became the object of much abuse and ridicule in these lands. The
truth of these statements is so obvious that it is unnecessary for me to
cite any illustrations in support of them.
Socially speaking all of Latin America may be divided into two general
classes, the politician and the business man. As a rule the “politico”
has been the cause of all the unrest and upheavals these countries have
experienced, while the advance and progress of these nations is due to
the “commerciante”—the man who uses his brain and invests his money in
its various ventures. The larger progressive enterprises in Spanish
America—the building of railroads, the developing of mines, exporting,
importing, in brief, commerce as a whole—is chiefly carried on by
foreigners, aided by a few ambitious, practical, far-seeing, native
business men, never the politician. Commerce is a great civilizing
agency. The higher in the scale of civilization a people are, the more
secure will trade relations with them be. The larger and more important
countries of Latin America have at last begun to realize that internal
peace means prosperity, that prosperity attracts, yes invites capital,
even from the timid and those whose government does not stand behind
them in a dignified manner.