THE DENATIONALIZATION OF CARIBBEAN BAUXITE: ALCOA IN GUYANA

Conclusions

In this paper we reviewed the early history of the Aluminium Company of America, in particular its conquest of hydro-power and its (largely successful) struggle for the bauxite of the Guianas. One reason for doing this was simply to bring to light this episode in the economic history of the Caribbean. And there were other reasons of contemporary, indeed immediate significance.

First, it is important to understand the nature of the economic organization to which Caribbean bauxite resources were appropriated and within which they were – and are – organized. Alcoa’s objective was long-run profit maximisation, as it is of all firms in any so called “market economy”. This led to a strategy of vertical integration, and control over those natural resources of strategic value in the aluminium industry. These resources were utilized as part of a grand hemispheric design to control the aluminium industry of North America and to provide a steadily growing supply of aluminium at a relatively low and stable price[5].

It should be emphasized here that this strategy was not the result of the personal idiosyncrasies of the men who happened to be in charge of Alcoa, or of some peculiar propensity to conspiracy on their part. Nor was this kind of policy peculiar to Alcoa amongst aluminium companies or to aluminium companies as a group. The strategy of vertical integration and control of strategic natural resources was the characteristic strategy of metropolitan enterprise in that phase of metropolitan economic development, Companies such as those in the oil, copper and food industries went through precisely the same phase as Alcoa – indeed, many of them had undergone these changes before Alcoa did. The strategy followed was a perfectly natural, rational and logical response to the needs of the firm for long-term survival and growth.

In pursuit of its strategy Alcoa linked Guianese bauxite to alumina and aluminium facilities in the United States, and with the water power resources of the United States and Canada. It should not be necessary to point out that there was no question of any idea of “Contributing to the local economy.” Guianese bauxite became part of the Alcoa economy and was made to contribute to it. Guianese themselves were significant only insofar as they eased the passage for Alcoa and could be manipulated in the company’s struggle with other metropolitan interests. A particularly revealing demonstration of this was provided during the trial of Alcoa when the Company’s Board Chairman was answering a question about Joseph King, the British Guianese who was named as Chairman of the Demerara Bauxite Company upon its formation by Alcoa in B.G. in 1916.

Q. (Mr. Rice, for the U.S. Government) Was he (Mr. King) chairman of the Demerara Bauxite Company after Mr. Peotter left?

A. (Mr. Davis, for Alcoa) Well, there are two Kings, father and son. I do not know which is Joseph and which is George. The father, whichever one he is, became sort of the titular general manager or chairman or whatnot of the Demerara Bauxite company, but it was not a position in which he really paid any attention to the company. He was a lawyer and took this position as chairman.

King’s role was therefore as a front man, utilizing his legal qualifications and his local knowledge to assist in dealings with local landowners.

Finally, it is interesting to note the way in which these men openly displayed their racist arrogance in court. Joseph Uihlein, in referring to a Surinamer who had allegedly been deceived into selling a bauxite property to Alcoa for much less than its true value, said to the Alcoa lawyer “Monengo Hill has 14 million tons of bauxite in it, which is the largest deposit and you took that big Negro, Nassey, with $250,000 for it, and he tried everything to break the deal. . . “ An exchange between counsel for the U.S. Government and Arthur Vining Davis is even more instructive. Davis was being cross-examined as to the reasons why Alcoa brought suit against various defendants, over title to the bauxite properties which the Uihleins had acquired. Among the defendants was a Mrs. Hubbard, a British Guianese widow to whom the land had originally belonged. Davis claimed that Alcoa had been “wronged, cheated and tricked” by the defendants.

Q. Did Mrs. Hubbard cheat you?

A. Well, we felt that she was an ignorant colored woman. We paid her I think about $8,000 or ten; the Uihleins paid her about three or four thousand more.

Q. Was Mr. Humphreys also an ignorant colored man?

A. I never saw him; I don’t know.

Q. Was he colored?

A. Well, I never saw him, but I think he is. I am not sure about that.

Unknown to Davis and to the inheritors of his Caribbean property, the word “ignorant” is often used in West Indian language in quite a different sense in which he used it on the witness stand back in 1939. An “ignorant” man is one whose capacity for suffering has been exhausted and who turns to anger instead. History will give a prophetic irony to his words, for there will be many, many more “ignorant colored” people for his corporate descendants to contend with.

The Legal case from which quotations in the text have been taken is:

Equity No. 85-73, In the District Court of The United States for the Southern District New York, United States of America v, Aluminum Company of America, ce. al.

[1] It is doubtful whether there has been any fundamental change since that time, save perhaps in the skill and resources employed by these men in the fields of public and personnel relations.

[2] The electrolitic process by which aluminium is extracted from alumina is frequently referred to as “reduction”.

[3] Unfortunately the time has not yet come when politicians in the Caribbean run for election on a platform of public development of the region’s bauxite and other natural resources. But that time is not far off.

[4] A British Guianese, Joseph A. King, Crown Solicitor of Georgetown, was named as Chairman of Demba.

[5] The price was low relative to the prices of competing metals, but not necessarily relative to the cost of production. The U.S. Government presented evidence showing that Alcoa made handsome profits.