the colonial period, Costa Rica remained one of the provinces ruled
by the Spanish viceroyalty in Guatemala (together with the provinces
of El Salvador, Honduras and Nicaragua). Its position as the farthest
province from the crown's representative and the fact that great
mineral wealth was not discovered here meant that interest in this
distant territory was minimal, which in turn allowed Costa Rica
to develop in an atmosphere of relative autonomy not found in the
other provinces of Central America.
provincial Governors were always Spaniards appointed by the monarchy,
although once settled in the new territory they inevitably set about
attending to their own personal interests rather than those of the
province and its colonists. This practice was by no means limited
to the province of Costa Rica but was apparently commonplace throughout
the New World colonies, which lead to much discontent among the
the latter part of the 1700's, Spain's concern for the welfare of
its American territories decreased as its interest in taxing them
increased in order to help solve problems at home (including those
brought on by a feisty Frenchman by the name of Bonaparte). Discontentment
with the crown in other parts of Latin America led to wars of independence.
There was even some sporadic insurrection in other areas of Central
America between 1811 and 1814.
over the situation of the Guatemalan territories with respect to
their relation to Spain ended in the signing of the Guatemalan Independence
Act on Sept. 15, 1821.
of independence from Spain reached Costa Rica by messenger in mid-October
and in November of 1821 the first provisional government of Costa
Rica was formed. This body drafted the "Concord Pact"
on Dec. 1, a document that is considered the original Costa Rican
Constitution. The Pact established the sovereign right of Costa
Rica to decide its political future and guaranteed to its citizens
civil liberty, the right to property and other human rights.
this newfound independence from the mother country was not met everywhere
with total acceptance. Throughout Central America there were groups
of imperialists who still felt loyalty toward Spain and clashed
with the separatists over the issue of becoming part of the Mexican
Empire or remaining completely independent. Costa Rica was no exception.
The majority of the town elders in both Cartago and Heredia proclaimed
themselves imperialists, in contrast with the predominant republican
sentiments professed in San José and Alajuela.
although Costa Rica did not have to fight to gain its independence,
ironically it battled over the meaning of this status and in April
of 1823, in the area of Ochomogo (halfway between Cartago and San
José), a battle was waged between groups from the two factions.
Those favoring independence were victorious.
other significant outcome of this skirmish was that the capital
of the country was then transferred to San José from its
previous site in Cartago.
Beginnings of an Economy
exportation of agricultural products to Nicaragua and Panama and
the importation of cloth, metal implements and other goods that
characterized the trade which Costa Rica conducted beyond its frontiers
during the colonial period resulted in the concentration of wealth
in the hands of local merchants. By the mid-18th Century, much of
the agricultural produce came from small family-run farms, since
shortages of indigenous labor caused the failure of many of the
former large land holdings that had been a prominent feature of
the Central Valley's landscape a century earlier.
currency was in short supply, most of the trade between farmers
and merchants was conducted using a barter system in which the merchant
inevitably got the better part of the bargain. Relatively little
local commerce existed in the 1700's, since most people were farmers
and most farms were designed to be self-sufficient. Thus, the majority
of the trade consisted
of surplus crops or livestock that were bartered to obtain imported
items from the merchants.
spite of continued population growth and agricultural expansion
across the Central Valley, this bucolic, non-capitalistic lifestyle
might easily have continued for many years after independence had
it not been for the introduction of a foreign plant species: Coffea
arabica, more commonly known as coffee.
spread of coffee cultivation throughout the Central Valley resulted
in numerous profound changes in the development of the fledgling
republic. As more and more of the small subsistence farms converted
to coffee plantations, it became necessary to import food crops
from other countries, principally Nicaragua. The merchant class
also became active in growing coffee on lands they owned and this
necessitated the hiring of laborers. The operation of coffee mills
also required salaried workers. Thus, the beginning of a capitalistic
society, in which labor itself becomes a commodity, was established.
prior to the expansion of coffee growing, a source of mineral wealth
was at last discovered in Costa Rica. In 1815 gold mining began
in the Montes de Aguacate -- a mountainous area along the route
traveled between the Central Valley and the Pacific port of Puntarenas.
As a result of this activity, the government began minting coins
in 1824. By 1833, gold exports accounted for 48% of the country's
year earlier, coffee had for the first time been shipped from Puntarenas
to Chile, from where it would be sent on to England. This was the
start of what was to become a very profitable relationship, so profitable
in fact that from 1843 until 1880 coffee made up between 85% and
95% of the nation's exports. By then, most of the coffee production
was being shipped directly to England.
rich volcanic soils of the Central Valley and an ideal climate for
growing coffee, combined with the agricultural tradition of the
majority of the inhabitants and the marketing experience of the
merchant class, propelled Costa Rica to an economic position far
superior to most of the rest of Latin America, where many countries
were so embroiled in bloody civil wars that concern for developing
a national economy took a definite back seat.
with the coffee boom were many advances in development, including
the founding of banks (with a combination of British and Costa Rican
capital), the construction and improvement of roads and port facilities,
the establishment of the country's first telegraph system which
connected Cartago with Puntarenas (via San José, Alajuela
and Heredia), and the building of the nation's first railway linking
Alajuela, San José and Cartago. Even the construction of
the country's premier architectural showpiece, the National Theater,
can be traced to the prosperity brought by coffee production.
the second half of the 19th century, however, advances in health
and education did not keep pace with the development of infrastructure.
This is not to say that the governments of the time were not active
in trying to provide improved education and health care, but simply
that it took longer to see the results. Poor sanitary conditions
were the principal cause of periodic outbreaks of infectious diseases,
such as cholera and dysentery, and life expectancy at the turn of
the twentieth century was only 30 years. With increased attention
paid to the public health sector, life expectancy rose from 35 to
56 years between 1920 and 1950. Likewise, an expanding public education
system resulted in a decline in illiteracy from 55% in 1910 to 33%
in 1930, and to 21% in 1950.
Bananas, Chocolate and Gold
oxcart, which has become something of a national symbol of Costa
Rica, was instrumental in transporting sacks of coffee beans from
the Central Valley to the Pacific port of Puntarenas, but this was
made possible only after the path through the mountains was sufficiently
widened in the mid-1840's to allow oxcarts to replace mules as a
form of transportation. Nevertheless, shipping coffee to England
from the Pacific side of the country meant a long, arduous voyage
around Cape Horn. The obvious solution was to open a route that
would link the Central Valley with the Caribbean coast. And the
way to do it? A railroad!
1884, the Costa Rican government signed a contract with Minor Keith,
a North American who agreed to construct a narrow-gauge railroad
from San José to Limón in exchange for 300,000 hectares
of land on the Atlantic side of the country. On this vast acreage
Keith began banana production, and in 1899 joined with the Boston
Fruit Company to form the United Fruit Company.
laborers were brought from Jamaica to work the banana plantations
and build the railroad because they were better adapted to the climatic
conditions of the Caribbean lowlands than were the European-descended
inhabitants of the Central Valley. Due to the relative isolation
of the banana producing regions from the other populated areas of
the country, a unique culture evolved on the Caribbean side of Costa
Rica, characterized by a distinctive Jamaican flavor.
1913, Costa Rica was one of the world's leading banana exporters,
although coffee was still the nation's principal foreign revenue
earner. At about this same time, the United Fruit Company began
converting some of its extensive monoculture banana plantations
to cacao because of a fungal disease, known as "Panama disease,"
that was affecting the bananas. By 1925, cacao figured third on
the country's list of export products.
Keith also used his fortune in the purchase of 40,000 hectares of
land in the Tilarán mountains, where he started the Abangares
Gold Mining Company. Although seemingly worlds apart, this gold
mining operation held much in common with the way banana production
was carried out. Immigrant labor from Honduras, Nicaragua, and also
Jamaica was employed along with Costa Rican workers. The work was
demanding, and even though well-paid, the workers were isolated
in the mining villages and had little choice but to spend their
hard-earned pay in the company store owned by the mining company.
most of Keith's holdings were essentially vertical monopolies whose
production came from land they owned or controlled, and his dealings
with the government gave him the advantage of numerous tax breaks,
a relatively small percentage of the income generated by his various
activities entered the national economy.
Revolution of 1948
the relatively little that might be known about Costa Rica beyond
its borders is the fact that this tiny Central American nation is
unique in having a functioning democratic system and no army. However,
these conditions have only existed since 1949.
is true that in Costa Rica the democratic tradition dates back to
1889, although direct voting for presidential candidates did not
go into effect until 1910 and women gained the right to vote as
late as 1953. Noheless, from 1821 to 1948, electoral fraud and coups
d'état were a regular part of the local political reality
-- witness to the fact is that in the 93 years between 1821 and
1914 there were a total of 92 political conflicts characterized
by violence, although brief and limited in scope.
factors combined to create the political situation that resulted
in the revolution, or civil war, of 1948.
Rica's century-long economic dependence on a single export crop,
coffee (bananas have never had the same direct influence on the
national economy), inevitably tied the economy to the vagaries of
an international market. Coffee prices had already been in decline
for several years when the worldwide depression hit in 1930. This
resulted in a drastic reduction of both coffee and banana exports
along with a severe drop in imported goods. Because most government
revenue was then generated by taxes on imports, the depression also
decidedly diminished state funds.
economic conditions produced a serious social crisis marked by unemployment,
food scarcities, lowered wages for government employees, and a general
decline in the standard of living to which Costa Ricans had been
accustomed. The growing proletariat had already been making increasingly
vehement demands for better working and living conditions prior
to the onset of the depression, and thus the stage was set for the
inception of the Costa Rican Communist Party in 1931. Several strikes
by urban workers and by thousands of banana plantation workers in
the Atlantic lowlands in 1934 demonstrated the power of this new
political force and sent a clear signal to the traditional ruling
government was obliged to take a more active role in solving social
and economic problems. Banking traditionally had been controlled
by foreign capitalists and the local coffee oligarchy, but in 1936,
the state intervened in this area with the creation of the National
Bank of Costa Rica and the General Superintendent of Banks, designed
to exercise certain controls over the private banks. Previously,
in 1933, a federal institute had been created to establish prices
paid for coffee by the coffee mills and to regulate relations between
the independent growers and the mills.
end of a 70-year period of governmental liberalism and laissez-faire
was being heralded. At the same time, a generational change was
taking place in the national political arena and, in 1940, Dr. Rafael
Angel Calderón Guardia was elected president with an overwhelming
85% of the vote. His ambitious platform, however, was limited by
the federal fiscal deficit and a new period of difficult international
economic times brought on by World War II.
during his four years in office the University of Costa Rica was
founded (1940), the Seguro Social -- a national health care program
-- was created (1941), the "Social Guarantees" were amended
to the Constitution (1942), and the Labor Code was enacted (1943).
History will perhaps best remember Dr. Calderón for having
promoted the Social Guarantees, which include the right to work,
minimum wage, an eight-hour work day, a 48-hour work week, paid
vacations, the right to unionize and to strike, social security
and the formation of the Labor Courts to litigate disputes between
workers and employers.
the sweeping popularity that brought him into office, by the second
year of his presidency Calderón was beset by critics from
all sides. Those wielding economic power were not enamored of many
of the social reforms, the communists were not in favor of legislation
that instituted religion classes in public schools, and nearly everyone
opposed the government's handling of the country's economic problems.
To make matters worse, accusations of corruption were frequent.
the many critics was a politically unknown farmer/businessman, José
Figueres Ferrer, who, during a radio program on July 8, 1942, denounced
the government's economic policies and claimed that it had given
in to the Communist Party. Incensed by his oratory, the government
had him arrested and deported to Mexico. However, that was not to
be the end of Mr. Figueres.
was not until a year later that the government of Calderón
Guardia actually did form a pact with the Communist Party in hopes
of assuring a victory in the 1944 presidential elections. Both groups
had a mutual interest in preserving the social reforms that had
recently become law, and it is thought that perhaps Calderón,
being aware of the decline in his popularity, imagined the communists
could be useful with their capacity at organizing and mobilizing
masses of people.
election campaign of 1944 was marred by numerous violent confrontations
between followers of the Calderón/communist coalition, known
as "The Victory Block," and those of the León Cortés
Democratic Party. Cortés had been president from 1936 - 1940
and was running for reelection against Teodoro Picado, the man picked
by Calderón to succeed him. By an ample margin, Picado was
declared the winner, although the opposition party denounced that
the results were tampered.
to placate the opposition, Picado instituted several reforms aimed
at improving public finance and, most importantly, promoted the
creation of the Electoral Code which included the formation of the
Electoral Tribune, supposedly a politically neutral organism charged
with safeguarding election results and eliminating fraud.
advance that might have been gained towards smoothing over differences
with the opposition was nullified, however, by the changes made
to the tax laws in December of 1946. Both small agricultural and
industrial producers as well as those with large capital were equally
vocal in their discontent over having to pay higher taxes, especially
the agricultural exporting class that was long accustomed under
the liberal regimes to not having their activities taxed.
in 1944, José Figueres had returned from exile committed
to forming the "Second Republic" and a year later created
the Social Democratic Party. Six months later, this party entered
into an alliance with the León Cortés Democratic Party
and the National Union Party, led by Otilio Ulate, who was later
elected as the party nominee for the presidential election of 1948.
Their platform centered on free elections and anti-communism. The
Victory Block's candidate was Dr. Calderón Guardia, who aspired
to a second term in office.
months leading up to the elections on February 8, 1948 were filled
with tension and frequent acts of violence perpetrated by members
of both major political forces. The level of conflict escalated
from that of the elections four years earlier with the inclusion
of terrorist attacks on newspaper companies, radio stations, and
even important political figures, including Calderón himself.
And, of course, both sides alleged that the other party intended
to rig the election results.
Otilio Ulate outpaced Calderón by 10,000 votes, but the Victory
Block garnered a greater number of seats in the legislature than
did the National Union Party. Calderón Guardia refused to
acknowledge the defeat. Also, the day after the elections, a fire
of suspicious origin destroyed many of the ballots. It seems that
the Electoral Tribune was not very successful in its first trial
majority, the members of the Electoral Tribune declared Ulate to
be the President-elect, pending confirmation by the Legislative
Assembly. Calderón petitioned the legislature to nullify
the results, which they did (the majority of representatives were
members of the Victory Block party), although they ruled that the
legislative position results were valid.
was the spark that ignited the fuse that had been set years ago.
On March 12, 1948, word reached San José that a band of revolutionaries
led by José Figueres had taken over the town of San Isidro
del General in the southern part of the province.
revolution lasted for five weeks with sporadic fighting in which
Figueres' troops, self-proclaimed as the National Liberation Army,
proved victorious over the badly organized and poorly directed Costa
Rican army. In fact, much of the defense of the government was provided
by armed communist party members. However, the government was reluctant
to give them enough material support to be truly effective, and
on April 19, the government of Teodoro Picado opted to surrender
Figueres-Ulate Pact was signed on May 1, 1948, giving Figueres 18
months to govern the country without a legislature before turning
over power to Ulate. Amazingly, in the context of Latin American
politics, this pact was fulfilled on November 8, 1949.
those intervening 18 months, the Government Council presided by
Figueres instituted many profound changes. Among these were the
nationalization of the banking system, the establishment of a 10%
capital goods tax, the prohibition of the Communist Party, the abolishment
of the country's armed forces, and the creation of the Costa Rican
Electricity Institute (I.C.E.). Not all of these measures were met
with pleasure by all sectors of the population.
its reformist intentions and promises made at the end of the revolution,
the temporary government was characterized by a very authoritarian
style and even embarked on a veritable witchhunt against members
of the Calderón and Picado governments. On December 10, 1948,
the exiled Dr. Calderón and his supporters invaded Costa
Rica from Nicaragua. With the aid of the Organization of American
States, this overthrow attempt was squelched.
Government Council also drew up a proposed new Constitution to be
ratified by the National Constitutional Assembly, elected in January
of 1949 for just this purpose. This assembly rejected the Council's
draft and set about writing its own version based on the nation's
previous Constitution of 1871. The new Constitution of Costa Rica,
which maintained the Social Guarantees established under the presidency
of Dr. Calderón Guardia, was ratified on November 7, 1949.
evidenced during the mere year and a half that José Figueres
held power over the decision-making process of the country, the
government would become a much more active player in the nation's
economic and social affairs. The period from 1950-80 can be typified
by unprecedented growth of the public sector, the modernization
and diversification of the country's economy, and the accumulation
of a tremendous national debt.
the expansion of government services and the proliferation of state
institutions, the number of public employees rose from slightly
more than 15,000 in 1949 to nearly 130,000 by the year 1979. On
the positive side, Costa Rica now possesses better health and education
systems and more infrastructure, particularly roads and electrification,
than most other Latin American nations. The cost of this has been
the creation of an unwieldy and often ineffective bureaucracy, along
with the dubious distinction of having the world's second largest
per capita debt in 1980.