Belterra and the Demise of Henry Ford’s Brazilian Rubber ‘Empire’

Biographical, Economic history, Geography, International Relations, Regional History

16F41C5C-69E8-4946-87A1-FC4CA093EDA7By the 1930s it was apparent to all concerned that Fordlândia, Henry Ford‘s rubber plantation in the Amazon, had been a costly, massive underachiever. Ford however, to the unending frustration of his family, doggedly refused to pull the plug and walk away from the Amazon fiasco counting his losses. In 1934, instead of ditching the failing Fordlândia operation altogether, he retained it and at the same time poured a fresh pile of money and resources into a second Amazonian rubber plantation site.

Learning from failure
The new rubber plantation, at Belterra, was better positioned geographically in relation to the main regional city of Santarém (just 40 km south of it). The plantation site selected this time was a more judicious choice, unlike the uneven ground of Fordlândia, the site comprised a flat topography, much better terrain for moving equipment around and for planting✱. The more favourable physical conditions at Belterra meant that Ford’s agrarian labourers were over a period of several years able to cultivate some 19 square miles of land for the planting of rubber trees (not a gigantic quantity by any reckoning, but a significant advance on the pitiful returns from Fordlândia)  [‘Belterra, Pará’, Wikipedia, http://en.m.wikipedia.org].

9D6EF65F-8330-40D7-93A7-9DCDBC8E9034Improvements in local agronomy
The horticulturalists at Belterra were conscious of the need not to replicate the monoculture prevailing at Fordlândia – which had made the rubber plants vulnerable to infection. By planting hardwoods this time and employing new breeding methods which used local varieties, the planters were able to avoid the scourge of Fordlândia – the Amazon leaf disease. The downside of this method however was that it was very labour-intensive and expensive [ibid.].

Infrastructure, variety and man-management
One of the clear lessons of Fordlândia was that living conditions for migrant workers in the camp were not conducive to creating a happy workforce. Again, as at Fordlândia, the migrant employees (based on the precedent of Ford’s American plant workers) were paid much higher than the going rate elsewhere in Brazil…but the company had learnt from the Fordlândia plantation that this was not enough of itself to get the desired worker performance. This time Ford’s managers delivered an enhanced town infrastructure…the drawing board for Belterra included three well-staffed hospitals (a critical area of shortage at Fordlândia) and three major (and two minor) schools◊. The sanitation system was much improved on the earlier settlement (arguably it was better than anywhere else in rural Brazil at that time). The street layouts were better planned and more uniform (straighter streets, more systematic street grid and more effort put into ‘greening’ the environment). The Belterra management gave workers more options for their leisure time – construction of football fields⍟ and playground equipment, movie and dance nights (exclusively folk dancing, another obsession of Henry Ford!). The upshot was to give the plantation town something akin to a suburban feel [‘Dearborn in the Jungle: Why Belterra Flourished Where Fordlandia Failed’, Past Forward: Activating the Henry Ford Archive of Innovation, (blog), www.thehenryford.com].

Whereas Fordlândia had catered exclusively for single men in its Brazilian work force, the Ford managers (eventually) adopted a more realistic, far-sighted policy, recruiting an increasing number of migrant families to the plantation…showing that Ford (or his management team) were serious about addressing the staff problem that had plagued Fordlândia, a high rate of turnover of the work force [ibid.].

Some relaxation of Ford’s tight reins
Other efforts were made to appease the plantation’s migrant work force to make them more compliant with company target objectives. The imposition of American food on Brazilian work force, which had been the bane of (a large slice of) the dissension in Fordlândia, was lifted. The Brazilian tappers and labourers were allowed to retain their traditional, local eating habits. In addition, in a further relaxation of conditions, musical instruments (an integral part of the Brazilian lifestyle) were allowed in the camp [ibid.].

Ford’s American ‘civilising’ mission for the “undeveloped world”
Despite a relaxing of some of the rules governing the running of Ford’s new industrial town in the Amazon, there were certain things Henry would not compromise on.  Ford was always big on “moral education”…part of his rationale for getting into the Brazilian jungle was to fulfill a mission to realise a peculiarly idiosyncratic idea of his concerning “racial progress’. As Elizabeth Esch describes it, driving Ford was a patronising impulse to “proletarianise and civilise” the uneducated rubber tappers of Amazonia, to make them into “something better”※. In the carmaker’s eyes, melding the workforce into an more efficient unit went hand-in-hand with educating them.

Belterra school girls and boys in Ford’s uniforms, ca.1940 | THF56937 | by the Henry Ford (Flickr)  🔽

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Midwest “old school” values
School was compulsory at Belterra – for all! Adult workers had to attend night school classes. Schoolchildren were strictly schooled and imbued with discipline along American lines of education…all workers’ children were issued with uniforms (which made the boys look like boy scouts or cadets). Every school day started with the ceremonial raising of the US flag. Some observers have noted how Ford’s installing of rigid educational and moral discipline at Belterra mirrored his own value system…to whit, tantamount to a kind of  sociological experiment to “Americanise Belterra youth” along the lines of a “Mid-western small town model” [‘Dearborn in the Jungle’, loc.cit.].

Global war, disruption and end-game
Ford established a tyre manufacturing plant in Dearborn in 1937 which by 1940 had the capacity to build 5,000 tyres, unfortunately for Ford NOT ANY of the raw rubber was sourced by that time from the company’s Brazilian plants [Ford Richardson Bryan, Beyond the Model T: The Other Ventures of Henry Ford, (1997)].

🔽 Henry Ford tinkering (Photo source: The Ford UK Co)

63462031-6AB2-4C20-85DE-E247F66364D3The Amazonian rubber venture by 1941 nevertheless did seem to be making some headway, there was in excess of three-and-a-half million rubber tree planted (mostly at Belterra), which by the following year had yielded 750 tons of latex  [ibid.]. The Ford Company was optimistic enough to announce that it expected to produce 30 to 40 million pounds of high quality rubber from the Amazon by 1950 [Esch, op.cit.]. One thing in its favour, as a consequence of the world war extending to the Pacific, was that British, Dutch and French Far Eastern rubber plantations were now in the hands of enemy Japan and no longer commercial entities.

Ultimately though the war rebounded on the Ford Company as on commerce generally with an increasing drain on the US economy for the war effort.  The motor company’s finances were not in great shape during the war years…incredibly the increasingly ‘flaky’ Ford Senior had axed the global company’s Accounting Department! [G Grandin, Fordlândia: The Rise and Fall of Henry Ford’s Forgotten Jungle City, (2010)]) . The domestic situation in Brazil was not helping Ford’s rubber plants…although powerful Brazilian President Getúlio Vargas had given approving nods in the public eye to the company’s presence in Brazil, labour law reforms in the country were not advantageous to Ford. The Brazilian government also restricted the export of lumber during the war. To exacerbate matters even more, the rubber plantations were hit with a return bout of the dreaded leaf blight infestation [Bryan, op.cit.].

Synthetic rubber – the future!
Ford’s son Edsel✜ and grandson Henry II had for several years been badgering the bewilderingly stubborn and by now ailing and declining industrialist to bring the wasteful Amazon fiasco to an end. What possibly clinched it in the end was a technological breakthrough, by 1945 synthetic rubber production was a superior and more economical method of getting latex than natural rubber. Moreover, with WWII now over, Britain and the other European powers had regained control of their lucrative Far Eastern rubber estates, and would once again provide the Ford rubber plants with very stiff competition [ibid.]. In December 1945 Ford finally sold the Fordlândia and Belterra plantations back to the Brazilian government, losing over US$20 million in the deal [‘Belterra, Pará’, Wikipedia, http://en.m.wikipedia.org]. The  dragged-out, ill-fated Amazon venture of Ford, which perpetually “had teetered between failure and farce” was over [Esch, op.cit.].BAEEFE61-81ED-45EE-8E6B-3B17AE5397C8

PostScript: Fordlândia and Belterra redux
Belterra today is in much better nick than Fordlândia, this is largely because the Brazilian government has kept the Belterra plant operational, although it has never been particularly profitable. Fordlândia on the other hand bears many of the characteristic scars of a ghost town. When Companhia Ford Industrial Do Brasil ceased operations in 1945, the Americans cut and ran, leaving things pretty much as they were…pieces of equipment and machinery abandoned, left lying idle, to rot or to be stolen or to be vandalised (contemporary Fordlândia has been described as a “looters’ paradise”◘), furniture, door knobs and other fittings, whatever that was movable, was taken. Most of the original buildings though have survived✥, as well as the plantation sawmill, the generator and such industrial relics, left rusting in the jungle for the past 73 years.

The most striking physical industrial remnant at Fordlândia today is the Torre de água – the 50m-high Water Tower…it still stands, like a symbol of the lost town, and like most of the fixtures at Fordlândia, built in Ford’s Michigan and shipped to the Amazon. Greg Grandin describes its still erect form as a reminder of what it once personified, “a utilitarian beacon of modernity for Ford’s ‘civilising’ project” [Grandin, op.cit.].

15330077-3C7C-4A29-BF29-2D8033DE644D__________________________________________________________
✱ botantist expert James R Weir, brought in to ‘troubleshoot’  the company ‘s dismal performance in trying to grow rubber at Fordlândia, came up with the idea of a second plantation in the Amazon (and then promptly left the project altogether!)
◊ named after Henry Ford’s three grandsons, Edsel, Benson and Henry
⍟ Ford had banned the playing of football (soccer) at Fordlândia
※ there was lots of talk at Dearborn about “taming savages” and more disturbingly, of pseudo-racial categories – creating a  “Latin-Saxonian unity” that supersedes the ‘Indian’ and mestizo groupings, E Esch, ‘Whitened and Enlightened’: The Ford Motor Company and Racial Engineering in the Brazilian Amazon’, in OJ Dinius & A Vergara [Eds.], Company Towns in the Americas: Landscape, Power and Working Class Communities, (2011)
✜ Ford heir Edsel predeceased his father, dying in 1943
◘ Simon Romero, ‘Deep in Brazil’s Amazon, Exhibiting the Ruins of Ford’s Fantasyland’, New York Times, 20-Feb-2017, www.nytimes.com]
✥ but not the crumbled mess of the town hospital

Fordlândia: The Dearborn Carmaker’s Amazon Folly

Biographical, Economic history, Geography, International Relations, Regional History

Pioneering American industrialist Henry Ford built his first commercial automobile in 1901, and went on in the years following to revolutionise the motor vehicle industry with his eponymous Model T Ford and his innovative assembly line production techniques. With the advent of Fordism (a system involving modern technological machinery and standardised production in high volumes) Ford was paying his auto industry employees an (at the time) unprecedented $5 a day! However it came with very consequential strings (a dehumanisation of the workplace and the loss of workers’ individual autonomy).

By the 1920s Ford was pursuing a plan to harness the waters of the Tennessee River to power a proposed 75-mile long mega-city, which the car-maker proclaimed would be a “new Eden” in northwest Alabama. A concerted campaign by political opponents within the US however blocked Ford’s efforts to get the scheme off the ground ‘[‘Valley of Visions’, (Adam Bruns), Site Selection Magazine, May 2010, www.siteselection.com]. Vexated but undaunted, Ford turned to the remote Amazon jungle for his next big project.

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The rubber market and “latex gold”
Rubber was in high demand by car manufacturers like Ford and his American rivals General Motors and Chrysler. Rubber is the source of latex, which is vulcanised to create car tyres and for a range of other vehicle parts (eg, valves, gaskets, hoses, electrical wiring). The problem for Ford and other manufacturers was that the European colonial powers, France, the Netherlands and (especially) Britain, had an established monopoly on the production of rubber through their profitable South-East Asian colonies (Malaysia, the East Indies, Vietnam, Ceylon). Ford was particularly concerned that the British, spearheaded by its secretary for colonial affairs Winston Churchill, was intent on creating a rubber cartel to further monopolise the valuable product for the Europeans. The industrialist therefore was looking round for a cheaper way of sourcing rubber…he briefly considered planting rubber trees in the Florida Everglades but that didn’t turn out to be promising. His focus eventually fixed on Brazil and its vast Amazon Basin (see also the Footnotes).

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Eyes on Brazil

From 6,000 km away in Ford’s Dearborn  car ‘empire’ headquarters, the Amazon looked a logical location for a rubber plantation. It was after all the original (and therefore seemingly the natural) environment for producing latex, being the home of the plant Hevea brasiliensis, used to make the most elastic and purest form of latex!

Ford’s idealistic and ideological vision
Clearly Henry Ford saw the long-term business advantages of securing a consistent supply of latex at the most favourable prices, but in his public pronouncements he let it be known that he viewed the Brazilian project as something grander than an attempt to corner a resource market  – “a civilising mission” no less! Ford regularly couched his intervention in Amazonia in terms of it being an act of “benevolence to help that wonderful and fertile land” [‘Lost cities #10: Fordlandia – the failure of Henry Ford’s utopian city in the Amazon’, (Drew Reed), The Guardian, 19-Aug-2016, www.theguardian.com]. While some of the car manufacturer’s overblown utterances may have been an indulgence in PR, the Amazonian venture (and the fact that he persisted with it long, long past its use-by-date) suggests that the idea of Fordlândia represented something in his core that was deeply idealistic. Greg Grandin in his epic study of the Fordlândia experiment, has noted that despite the runaway success of his Detroit-based business empire, Ford had become increasingly disatisfied with modern American society and culture as he saw it, there was a whole catalogue of things that he abhorred…including war, unions, alcohol, cigarettes, cow’s milk(!), modern dance, Wall Street financiers, Jews, the creeping intervention of government into business and into American life as a whole [Fordlândia: The Rise and Fall of Henry Ford’s Forgotten Jungle City, (2010)].

A blinkered idealism
Ford saw in the challenge of carving a viable city out of the Brazilian wilderness, a potential antidote to all he disliked about his homeland – a way to recreate “a vision of Americana that was slipping out of his grasp at home” [ibid.]. Another driver in Ford’s Amazonian quest was the unflinching faith in his capacity to replicate the Dearborn business success elsewhere, including the Amazon jungle. This idealism led Ford, even when things went “pear-shaped” in Fordlândia “to deliberately reject the expert advice” and blindly cling to his peculiarly personal notion of trying “to turn the Amazon into the Midwest of his imagination” [ibid.]. Moreover, Grandin notes, that the greater the reverses of  Henry’s rubber enterprises in the Amazon, the more the carmaker would describe his ‘mission’ in Brazil in idealistic terms – Fordlândia would, he stressed repeatedly, bring economic stability and increases in the standard of life to the impoverished people of the Brazilian interior; the new city would support 10,000 people, etc [ibid.].

Initially, the government and it seems, the Brazilian people in the main, welcomed Ford’s Amazonian industrial city. Brazilian officials, especially consul José de Lima, went to great pains to woo the American carmaker once his interest in the Amazon became known. Some Brazilian officials even heaped overly-lavish, religiously evocative praise on Ford , calling him the “Jesus Christ of Industry”, the “Moses of the Twentieth Century” and “the salvation of Brazil’s long-moribund rubber industry” [ibid.].

By the terms of the business deal, Ford would pay the Brazilian government about US$125,000 for 5,625 square miles of land and the company was to be exempt from taxes. Under the concessions Ford’s city was to be granted an autonomous bank, police force and schools, to many observers it was a violation of Brazilian sovereignty…”it was as if Ford had the right to run Forlândia as a separate state”. The sceptical Santarém (local) press mockingly referred to the Dearborn (Michigan) car manufacturer as “São Ford” (“St Ford”) [ibid.].

The blueprint for Fordlândia
Ford poured a massive amount of resources into his (new) utopian ‘dream’ city. The plant was equipped with “state-of-the-art” processing facilities. No expense was spared on constructing the American village (known locally as Vila Americana) which was reserved for American management. It was equipped with a swimming pool, a golf course, tennis courts, a library, schools and a hospital. Not surprisingly, the de luxe conditions of the Americans’ village was in grotesque contrast with that of the Brazilian workers whose rudimentary houses lacked even running water [ibid.].

Setbacks and drawbacks
The jungle site picked out for Ford’s prefabricated industry town was Aveiro on the River Tapajós, in the state of Pará.  From the get-go in 1928 things did not go well! First off, clearing the dense jungle for the site was really hard (and dangerous) work…even with Ford’s promise to pay high wages to the locals, labour was in short supply. The project’s logistics provided another headache, the location’s communications and transportation had serious shortcomings, The location was hilly and there were no roads to Aveiro so movement was by boat up and down the river, and seasonal climatic conditions tended to impede access (also latter on hindering the cargo vessels trying to reach Fordlândia to load up the latex).

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“Agri-ignorance”
The task of planting rubber trees was thoroughly error-ridden. Ford’s managers used antiquated planting techniques, the team lacked basic knowledge of tropical agriculture. A fundamental flaw that proved critical was the company’s  practice (ignoring the advice of Brazilian botanists) of planting the rubber trees too close to each other, this resulted in making the plantings susceptible to disease (enabling the destructive South American leaf blight to move easily from tree to tree) [ibid.].

Illness caused by the harsh tropical location wreaked havoc with the work force (especially the migrant workers but also affecting the American staff). Workers went down with various ailments (malaria, VD, yellow fever, beriberi, parasites, snake bites, etc) placing a strain on the already overwhelmed company health services [ibid.].

Subverting worker morale
Ford imposed strict conditions of behaviour on the work force – in keeping with his personal puritanical code. A prohibition ban was imposed (to match the prevailing injunction on alcohol in the US at the time). In light of the severely harsh conditions they were working under, Ford’s “absolutely no tolerance” liquor policy was totally unrealistic. Workers were forced to endure a regime of rigid conformity – regimentation of plantation life, adhering to strict standards of discipline and hygiene. And to make things even more onerous, Ford introduced the same, notorious heavy-handed yolk of enforcement he employed in the River Rouge automobile plant in Detroit. Ford’s “Big Brother” like Service Department men were employed to carry out highly intrusive spot searches on workers’ quarters to ensure compliance with the edicts.

7405683B-B783-423E-B198-22948C4EDE1CAmericanisation overkill
Ford insisted that the migrant workers at Fordlândia adhere to Americanised conditions of work and services which ignored the local realities and cultural norms. This meant everyone got American-style housing with metal roofs which were conductors of the already intense tropical heat (in preference to the more sensible natural thatch roofs they were used to in Brazil). Another “First World” error by Ford was to build workers’ houses close to the ground…the locals in the Amazon knew to build high up on stilts so that they didn’t get overrun with animals and insects! Ford was insistent on interfering with the Brazilians’ diets, workers were fed unfamiliar food like hamburgers, whole-wheat bread and unpolished rice, and they were encouraged to plant flowers and vegetables on their plots. The American managers, with scant regard for the workers, forced them to work in the middle of the day in full tropical sun. Inevitably, the migrant workers staged a revolt against the management practices, known as Quebra-Panelas (the “Breaking Pans”). They rioted in late 1930, protesting against Ford’s imposed conditions, and the Brazilian army had to intervene to restore order (with management making some concessions with regard to the food) [ibid.].

Erratic managerial direction
Part of the problem with Fordlândia was with the management. They’re was a rapid turnover of managers in the first two years of the settlement.  Ford’s often wrong-headed policies were not easy to implement, but some managers were not up to the task and others just couldn’t hack it in the extremely challenging and arduous Amazon and quit. Unsurprisingly, with mismanagement morale plummeted, the American staff increasingly engaged in wild parties and drunken revelry.  It wasn’t until Scot Archibald Johnston was put in charge at the end of 1930 that progress started to be made at Fordlândia.  Johnston was able to improve the infrastructure, enhance the lifestyles of employees’ – new entertainments and recreations – film and dance nights, gardening, football games (overturning Ford’s earlier ban) and more education options. Grandin feels that under Johnston’s management, the city “came closest to Ford’s original ideal”. But still the yields of latex didn’t come remotely close to the company’s anticipated returns.

4412DA21-392C-47AA-85D1-E3A2E8B393CFWith the lack of commercial success, the original Brazilian government enthusiasm for Ford’s project waned badly. Even from the start there had been critics of the done deal that was vague on many details and required Ford to use only 40 % of his land grant for the production of latex. Eventually, there was a loss of credibility for Fordlândia – with the situation showing little improvement, the Brazilian middle classes ultimately could not square Ford’s “self-promoted reputation for rectitude and efficiency” with the reality of the plantation’s dismal track record [ibid.]

FN 1: British ‘Bio-piracy’
The European monopoly on rubber had its origins in the unscrupulous actions of British botanist Henry Wickham who clandestinely pilfered Hevea seeds out of the Amazon in the late 19th century. These were propagated successfulyl in Asia, putting the three colonial powers in a frontline advantageous economic position in the trade. The sale of latex, especially to the US auto industry which needed rubber for the expansion of the burgeoning industry, helped Great Britain and France pay off its (WWI) war debts [Grandin, op.cit.].

FN 2: The “latex lords”
Before the rise of the Asian rubber plantations, Brazil was the dominant world supplier…in the second half of the 19th century, processed rubber accounted for 40% of Brazil’s total exports. The Amazon’s big towns, Manaus and Belem, profited spectacularly from the rubber boom as witnessed by the magnificent BeauxArts palaces and grand neoclassical municipal buildings that sprang up. By the early 1920s however, the country’s rubber industry had bottomed out and Brazil was bankrupt [ibid.].8AA4C2F1-C6C5-485B-B7E9-59AF6443F91A
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so successful that the Ford Motor Company had captured over half the US auto sales market by 1921
rubber cultivation thrived in South-east Asia due to a combination of factors – the parasites (insects and fungi) that feed off the rubber in Brazil were not present; the cross-breeding of trees led to increased yields of sap. The plantations were close to ports (cf. Brazil), reducing the transportation costs. Lastly, the cost of labour (principally derived from China) was significantly lower [Grandin, op.cit.]

as it transpired, the deal was not as great as the Detroit carmaker thought …”swindled by a Brazilian con artist” Ford paid around three-times the value of the land [G Grandin, Empire’s Workshop: Latin America, The United States and the Rise of the New Imperialism, (2005)]

  a hardship compounded by the company providing the clearers with very poor housing conditions
and impossible to fully enforce…plantation workers got round the prohibitions (Ford’s ‘puritanism’ extended to bans on women in the town, on smoking and on the playing of football as well) by establishing illicit bars, nightclubs and brothels on the so-called “Island of innocence”, [‘Fordlândia’, Wikipedia, http://en.m.wikipedia.org]
leading some Brazilians to speculate that Ford’s real motives for intervening were to seek oil, gold and political leverage [Grandin, op.cit.].