tv Bankers and Empire CSPAN September 4, 2017 7:30am-8:01am EDT
facebook page, facebook.com. /book tv. book tv on c-span2, television for serious readers. >> you are watching the tv on c-span2 with top nonfiction books and authors every weekend. book tv, television for serious readers.oining u >> joining us on book tv is peter james hudson, the author of this book "bankers and empire: how wall street colonized the caribbean" what was your goal with this book? >> i think there were a number of goals here. in the first place was to excavate the international origin of wall street, to excavate the international origin and to locate those origins in the caribbean, which i think was a kind of critical r
and fertile testing ground. at the same time i was interested in trying to understand to some degree is there a relationship between wall street history in the international field and some of its contemporary practices, is there a way one can generate a genealogy through the 20th century and what were the kind of terms of that genealogy and of that international expansion. in that i think a couple of things emerge for me and one is the critical relationship thatet institution including what is now citigroup: j.p. morgan chase had to us imperialism in the 20th century. how these institutions really grappled with the question of w international expansion through
legal practices, through their attempts to sometimes trample regulation, sometimes extend regulation to support international capitalism and i think finally to also understand what is the relationship between the history of capitalism through wall street, through banking institutions and its relationship to the development, expansion, generation of ideas of race and racism, especially as they hinge on affect the sovereignty of caribbean people in haiti, dominican republic, panama, nikolai?ragua, host: wended wall street become wall street?coal guest: i think wall street-- i would argue wall street became wall street in the early 19thst century.
earlier years of us history salt wall streete is a and new york city is one of a number of capitals capital in the united states as commercial. baltimore had eight significant presence for a good time. boston, new orleans, but by the end of the 19th century increasingly capital capital becomes concentrated in wall street. the number of financial insurance firms are concentrated in wall street and it becomes really the commercial development of the us west and then when we start talking about the kind of expansion of american commercecomm overseas, much is going through wall street. different historians might locate the genealogy of wall streett as a p , not just a place, but a kind of idea, kind of signify of american capitalism.
for me, it really begins i towards the end of the 19th century at a moment when wall street is turning overseas, tur turning to look at overseas market. looking at the caribbean and also latin america. host: what was the interest in the caribbean? >> multiple interest in the caribbean. there was a sense in needing to use financial means towards political and on the part of the state department. there is the sense of the early history of dollar diplomacy, which your viewers will know that i did of substituting bullets for dollars in terms of foreign relations became important through that kind of work of roosevelt and taft. so, banking institutions were very important in terms of organization of
central banks in the caribbean, very important in terms oftant t currency system in the caribbean and the organization of these financial institutions was critical to theca state department's goal of political stability in the caribbean region, which was increasingly important in the context of world war i as well as in the context of the opening of the panama canal and the need to protect the cable lines and passages between the atlantic and pacific. beyond that there are of course purely financials and commercial interestsu.s. at the us banks not wall street had in the caribbean region and so these differ island to island, colony to colony , but sugar was one of the most important ones with institutions like citibank and later chase involved in financing of
sugar plantations throughout the region. there was interest in financing of caribbean sovereign debt, which was in the first part of the 20th century was the debt held by j.p. morgan as well as others.mpany he later, became very importance to institutions like citibank and like chase. chase became the largest lender to cuba by the end of the 1920s and beyond those questions of sovereign debt there was the question of on one level commercial banking, financing and trade, but also what we might call personal banking. in movement in the 20s especially by citibank to set up branch of bank in the caribbean which would service middle-class customers, so just the opening up interest deposits was the new and revolutionary thing in
the caribbean and something the bankers were surprised to find was profitable to them. caribbean people wanted to save and put their money in banks and get the small amount of interest on that moneyget the and that became very important kind of marketing practice on the parts of wall street. kind of monopoly of interest on the part of wall street. host: so, what was the impact generally on some of these nations, haiti, nicaragua, cubai guest: again, really differs from country to country. if you look at the-- at haiti and nicaragua for instance, these are two countries seen in the worst possible sense, exemplars of the failure of dollar diplomacy that kind of role of us banker in haiti led to the landing of us marines and the development of a 19 year
military occupation lasting from 1950 to 1934. it led to something that's intangible to somebody in the us audiences, but the extinguisher of patient sovereignty, transfer of their financial and economic control through wall street and also led to the thousands of deaths of haitian citizens by us marines. not necessarily one seeser bankers going in there with a gun, but they were advising the state department on us policy. they were the ones creating financial o system that created the some of the chaos in haiti that led tooccupati military occupation. similar things could be said about nicaragua. consequences for cuba with the developments or support of first the of dictatorship by the end
of the 1920s.s. he was democratically elected in 1925 on a platform of progress and reform. he was the kind of populist leader. he is invalid he would not take a more-- that cuba would not contract't any further debt and-- but he also said he would protect thehe als interest of wall street once elected and he did more to protect the interest of wall streette than to keep his people and he immediately began to figure out how the cuban government could avoid plat amendmentent wh which was struck lead that ability of the cuban government to takeke on more debt and went against that, contracted with chase manhattan bank for millions andfo millions of dollars of sovereign debt that crippled the cuban economy during an era where certain-- sugar prices remain depressed, so as cuba took on more debt and borrowed more
from chase and the repression of the cuban people became worse and eventually led to a real conflict in cubit in which we saw subsequent cuban governments suggesting that the debt itself is odious, contracted by illegal regime and it led to a real sense of animosity towards wall street that i think blasted for many years perhaps up to the cuban revolution in 1959, so in terms of the actual consequences across the region i think in the first instance we could say the consequences are the complete erosion of caribbean sovereignty, sovereign nations thatatsove suddenly didn't have control over their own destinies. in different ways we see the consequences where the violence of us military occupation, military violence of us marines in these countries to quote
unquote pacify caribbean occupation and with that violence came forms of us racism. jim crow that was exported to the caribbean region and at the end of the day while many of the bankers were involved in forms of financial reform, many professed to want to expand agriculture, to help develop the school system settings like this. none of these formed or amounted to much and much of the investment into the caribbean were seen as profits for patriot act of wall street.>> host: host: so, in your view is exploitation a very word to usev guest: i think it's a very fair word to use, ya. i think what i'm trying to argue in the book is that exploitation, the most of that exploitation were very complex and that is also not necessarily the kind of top-down vision of
what happened. it's not necessarilysa all-knowing bankers going into cuba or haiti or neck logout or the dominican republic acting as puppet masters over the caribbean people. there is always pushed back from the caribbean people and there is modes of negotiation where elites trying to get something from wallo get so street and also a sense that as much as many bankers were very deliberate in their activities in the caribbean they also did know what they were doing. ey they were using new financial instruments, trying to develop, trying to reform legislative practices that governed relations between states and governed relations between banks and estates. it's a history that was also marked by failure. when there was a sugar crisis in cuba in the early 1920s and invested so much money and cuban sugar that when the prices bottom out and almost destroyed
the bank and so it led to the recognition of the firing of many citibank executives. in the case of haiti while the citibank was a huge presence there it had negative publicity around the us occupation of haiti in the 1930s that was brought to the american public by organizations like the national association of color people. i mean, there was a kind of backlash against bankers, development of what that-- was referred to as anti- banking discourse. exploitation, absolutely i think is the word to use here, but we can'tcl use it in any kind of clean census. host: you also write about entity called that an atc which was what? >> north american trust companies and it was
founded i think in 1898 by a number of midwestern bankers. of the principal banker here was a figure by the name of samuel miller jarvis who made tremendous amounts of money working as an anchor involved in western mortgages. he was basically taking capital from england and set up a mortgage brokerage that wasla filtering capital from england in the northeast into the west, but at the end of the 19th century under suspicious circumstances he had collapsed the naacp and filed for bankruptcy. he left the west and ended up in new york city and suddenly in july, 1898, finds himself on a boat heading to santiago, cuba.
even before the us declared sovereignty over the republican before the us occupation of cuba has officially begun.n. he arrived and said iago , and opens up the first north american banking institution in cuba, which is the north american trust company.rth the activities of the north american trust company started a slow fashion, kind of involved in remitting money back to-- from american soldiers to their families at home, trying to introduceo currency-- us currency to the island. trying to develop a system of telegraphic transfers where money can meet-- be moved about the island, but they are also trying tobu become the kind of primary player in cuban government finances. they want to control theking taking of customs revenue, the money generated by the ports and also looking to
displace the old spanish bank to become cubaba central bank. there's a lot of controversy around them. many observers at the time see them as a kind of corrupting influenceorrupt whose activities are based on patronage, but they actually sin claps and they don't claps, but they resolve and r become a new institution out of cuba which becomes the de facto cuban government bank. the north american trust company is one of these institutions that many historians have talked about in the cuban context, but haven't necessarily, i mean, i think before my book people had to trace their history back to the us west from the west to the west indies and also extended the work of samuel miller jarvis through the --
through cuba and into the dominican republic where he then said that they know there bankkanot which also has-- it's attached with a lot of controversy attached to it. one of the main things i found with the northan american trust company in the history of samuel miller jarvis is he's it individual who's able to really see places where capital will assume muthu, so he understands and sees the west before, becomes the west and is able to prophet from them. he sees cuba as kind of haven for american businesses and he skillfully works between the legal regimes governing these places. he gets to cuba before the legal system is really set up before the terms of order in which the state has developed and he manipulates these spaces and i think works are a bit of graphic corruption in his
business. host: businessman or flimflam man? guest: a bit of both. that's a great question and what we see in the early history of us banking and caribbean is that they are always both. always hustlers alongside legitimate business and there's a fine line between the two and given the fact that sometimes the questions of sovereignty is weak, legal regimes are weak, yet it's difficult to say whether they are flimflam man or legitimate businessman. host: professor hudson, use a lot of these makers were advising the central government on foreign policy. did wall street in this -- move into the caribbean and have the full faith and credit in support of the federal government? guest: absolutely not.s there's times when the federal government wanted to restrain them and there's times when,nd
i mean, there's times of absolute collusion. one of the antidotes i tell in the book concerns an individual who was instrumental to the us occupation of haiti. back to the end of the 19th century and working in panama with the law firm sullivan and cromwell, but he becomes a defect out advisor to the us state department and members are going back and forth between the citibank and the state department and he is really telling the state department what's happening in haiti. but, you also see by the 1930s especially and especially with the coming to power of roosevelt, he in the context of the depression, in the context of the banking crisis and in the context of great animosity amongst usng public towards wall street at this time where he's like this needs to stop and he's
trying to through new deal legislation he's trying to restrain the bankers and their activities in the caribbean and i think the kind of congressional hearing on the currency under the guides of the lawyer fernando is a sign of this. he had access for the first time to citibank's records and the records of other banks in the legal offices of sherman and sterling and was able to kind of early for the first timeme someone is able to go in and get eight inner history or archaeology of the different exploited banking practices in the caribbean and through him the federal government works to try to restrain the activities of wall street.eet. host: so, basically we arere talking about the early 20th century right now? guest: yes. host: are these banks still prevalent and influential in the
caribbean and was the legacy of them? guest: it's interesting. there's a number of legacies. first i would say that in terms of current influence in the caribbean, the legacy is less one of us banks than of canadian banks. and one of the things i found in my research was the canadian banks especially royal bank of canada and bank of nova scotia to some degree the bank of montréal where the biggest competitors to us institutions in the early 20th century. cuba, i mean, throughout the region the royal bank of canada had more branches than citibank and always competed with them for deposits in cuba. you know, when as an example when the cuban revolution occurred in 1959, there was more of
a negotiated settlements with the castro government's on behalf of the canadian banks and with the us banks. us banks had to get out. us banks could work something out. we see now in the caribbean that the canadian banks are prevailing especially in the form of british colonies of jamaica etc. the us banks to some degree a retreat from the caribbean, though, you see citibank has recently returned to haiti after many years. i think the larger legacy was less aboutac the actual presence of wall street of the us bankers in the caribbean then it was of their understanding of what this history meant to them for the present and if you look at the kind of corporate biography of citibank, you understand that they looked at the 1920s
and-- 19 tens, 1920s and early 1930s as this glorious time of international expansion, when they were able to kind of create new financial institutions and financial instruments that were largely unregulated by the government, that they could collide into the world, do what they want, make money as they wanted to and after the 1930s with the making legislation they were restrained. so, what you see in the history of citibank is a sense that we need to get back to this era of unregulated expansion where we can collapse commercial and investment functions, where we can move across national boundaries without restraints and where we can basically do what we want without either sovereign-- either pesky sovereign caribbean nations or the us government breathing down our next, so through that there is an attempt to now, a sense
of wanting to move back into those markets, butt also a bit of a shift in terms of how they look at those markets, so it's less about say branch expansion into the caribbean than it is about kind of development of offshoreopment of investment vehicles in places like the cayman islands and panama. host: i don't know if you know this, but when i have traveled in that region i only see the bank of nova scotia, kind of like seeing the bank of wyoming c2 it's not a side note, it's relevant to the book. for two things, one is that the presence of canadian banks in the caribbean was so strong in the 20th century that when us bankers were trying to figure out how to move into the region and control caribbean markets at one point the staff,
citibank actually said why don't we simply purchase the bank of nova scotia and take over all of its s branches. we will close the canadian branches and maintain all the branches they haven't jamaica and haiti and cuba and that way we don't have to go instruct the network.on but i it was not a plan that came to fruition, but it gives you a sense of how powerful and important the canadian banks werewe at the time. what happened with canadian banks is there was a fairly stable unregulated canadian bank, charted by the canadian government. t there was only three or four banks as opposed to the radical expansion of state banking and national banking in the us. the canadian bankers first of all had experience inad exp international expansion within canada itself. when you think about thehe movement of institutions like the bank of nova scotia to montréal to
toronto and in the west, winnipeg, vancouver following the movement of the canadian pacific railroad, so they had already developed a sense of how you conquer space, basically. it was easy for them to move into the caribbean because they had this experience overseas. if you think of western canada as being overseas to the maritime provinces. furthermore, the canadian bankers were working in a kind of what we might call enter colonial mode, which isol the sense that they were going to do the work in the british colonies that england itself was not going to do.to d c caribbean territoryan sort-- to some degree were ceded to these banks and strengthened
the caribbean by establishing canadian capital in the region. at the same time the canadian banks recognizing that there was-- that national banking legislation in the us prohibited overseas expansion of us branch banking they saidaid it this is an advantage for us so we will go to cuba , jamaica and the other places and to serve as what one historian called surrogates of the us capital. they will go in there and do the kind of banking functions that wall street cannot do. in some cases like the royal bank of canada they set up a office on s wall street so they could be in the mix, but actually served wall street interest to some degree in the region and at one point i can't remember the exact date, but at one point chicago business interest and capital purchased a huge chunk of the royal bank of canada to use them.
i think it was mutual use, but used to-- but to use them for their own capital expansion and even now you see the presence of these banks there with this long cba historical legacy. host: peter james hudson is a professor of african-american studies here at ucla and the author of this book: "bankers and empire: how wall street coloized the caribbean". this is book to be on c-span2. >> book tv visited capitol hill to as neighbors on congress what they are reading this summer. >> i just finished a book called the immortal irishman about thomas patrick mark who was a leader of the lot-- young ireland movement and escape to america and become a brigadier general in the civil war and was the first governor of montana. intriguing book and when i would recommend. i just started reading born to run by bruce springsteen, one of my all-time favorite magician's and philosophers.
i'm also in the middle of the fredericksburg campaign. the campaign and the crossing of the river from virginia, a civil war book. the last book i intend to read this summer and one i will follow is the new jim crow about criminal justice reform in the us. >> what sparked your interest in the bruce springsteen story? >> i've been a bruce springsteen fan since 1978 and one of my first concerts was the concert after thanksgiving eve in 1980. one of the most memorable nights of my life. ..