Monday, October 15, 2007

Potosí y Cerro Rico


I am rich Potosí, treasure of the world, king of the mountains, envy of kings.

Potosí is a testament, more than anything, to Bolivia’s dependency and vulnerability to economic forces external to it; first marked by outright imperial and colonial control, but subsequently and currently defined by imperatives set by the international markets. Continuing to this day, the place has the overwhelming feeling of being a “company town,” with the original “company” being a dynamic joint venture between the Spanish Imperial Crown and the Catholic Church. Legend has it that the Old Gods intervened when the Andean Empire (what is somewhat problematically referred to as the “Incas”) discovered silver in the place prior to the Spanish invasion, telling Inca Huayna Capac that the deposits were meant for others. While the interpretation is usually a variation on your bread-and-butter imperialist manifest destiny, another reading could reasonably conclude that the Gods were warning the Inca against the unforeseen consequences that would accompany exploitation of the vast reserves of precious minerals hidden just below the surface of what the Spanish eventually termed Cerro Rico.


Cerro Rico towers above Potosí as though a sovereign, and indeed the economic history of the city (perhaps all of Bolivia) suggests that the analogy might be more than just poetic symbolism. Since the beginning of colonial rule in the Andean region, Potosí’s seemingly endless silver deposits become a central aspect of imperial policy, fuelling the long-term growth of the Spanish empire and funding its many wars, as well as financing trade relations between Europe and Asia. The Spanish colonial empire cherished the silver deposits in Potosí so much that while most Catholic churches face west, all of those in Potosí face South directly towards Cerro Rico, so that the silver mines could be blessed from their alters through open doors. The Crown celebrated the wealth of the mines by literally paving the streets with silver at one time.


The mountain that eats men alive.

For the native Bolivians, all of this meant radical social change. In order to continue exploitation of the mine’s wealth, the authorities of Alto Peru (a colonial administrative province spanning Peru, Bolivia, and much of northern Argentina) reinstituted the Andean Empire’s mita, a system of cross-regional forced labor, and implemented the importation of thousands of Black Africans through the international slave trade. The dangerous conditions in the mines meant near-certain death for most of these workers, with death rates estimated at seven out of every 10. Total estimates for the number of indigenous deaths occurring in the mines run as high as 9 million over the period of colonial rule, suggesting that Cerro Rico alone maintains bragging rights for a significant role in the long-term decline in the Alto Peru indigenous population. While the Spanish empire formally prohibited religious syncretism (the mixing of pre-columbian and Christian forms of worship), the Crown did not dare venture inside the mines where worship in El Tío, a cross between old mountain deities and the Catholic devil, helped preserve the mitayo soul against the inhumanly brutal realities of life in Cerro Rico.


The miners’ lots never really improved, even after the end of formal imperialism, as the fate of the industry was still dependent upon the international market price for mineral extracts. While the nationalizations that occurred after independence allowed the development of a strong miner’s union as a political force in the nation, corruption in the state-owned enterprise, inefficiency compared to international competition and increasingly northern-focused politics led to the privatization of the state-owned mining industry, effectively ending organized bargaining over prices and mining conditions. Whatever protections remained died with the crash in the international price of Tin in 1985 (which had replaced Silver as the main mineral extract of Cerro Rico after a century-long production decline), when even private ownership of mineral extraction was liquidated.


Where do you think the metal for your digital camera comes from?

However, this did not mean the end of exploitation of Cerro Rico’s rich veins, nor of the workers that eked a living inside them. After the “crisis” of mineral prices in the 1980s, formal ownership of the mines was transferred to existing workers and their families through the break-up of the quasi-statal private enterprises, creating a system of small- to medium-scale “traditional cooperatives.” However, these are not reflective of what one would normally think of as a cooperative. Rather, the cooperatives function by informalizing the system of labor in the mines, where the workers organize themselves and work either independently or in small- to relatively large- groups. Membership in a cooperative, however, merely means that the product of your labor accrues to the group’s total output, in exchange for a share of the market value of the minerals extracted, which is sold in tonnes to the privately operated refineries, which are freed of the labor costs associated with mineral extraction. In this way, the cooperative system functions similarly to what we in the U.S. would associate with an “independent contractor” system of informal labor, whereby a single agent is hired through contract by an employer, who is then freed from any further involvement in the subcontracting process organizing the division of labor. Similarly, the miners in Cerro Rico all work under the auspices of the “socios” of the cooperative, who retain the benefits of much of the group’s labor product themselves, in the form of life and health insurance which are unavailable to non-socios (socios receive a larger share of the market value of the extract output, and are also the only ones who pay taxes). And since it takes around 15 years of membership in a given cooperative to become a socio, this means that the majority of workers in Cerro Rico live according the luck of the mineral draw, whereby “quality and quantity” times the price set on the international market (London) determines his (no females work in the mines) standard of living. The inadequacy of this system’s ability to provide a sufficient standard of living is reflected in the high rates of child and female labor (outside the home) in Potosí.


The international price for the minerals drawn from Cerro Rico (Silver, Gold, and Tin are among the majors) is currently high, and this has led to an increase in the number of workers, both adults and children (some claim the number of the latter to be as high as 8000 kids or more, ages 11-18). Coupled with historically slow growth rates in most of Bolivia, this goes a long way towards explaining the sustained popularity of working in the mines. For example, one study reported a full 94% of miners responding that their main reason for working in the mines was a lack of alternative employment. “Tradition” was the second most frequent response. “I like it” was a distant third, and this was attributed mainly to the child workers, who compare mine labor not to the fantastical concept of a childhood spent in school, but against the prospects of working in the city, where earnings are lower and the romantic conception of doing a “man’s work” is absent.


However, the market price of precious minerals could fall at any time, and while Bolivia’s overall growth rate under President Morales has been impressive, it remains uncertain whether this growth rate will be extended evenly across the county. In the foreseeable future Cerro Rico remains the destination for an increasing number of Bolivia’s poorest.

James Read, The Rough Guide to Bolivia, (August 2002).

Pedro Negro, Koala Tours-Potosí, (October, 2007).

Mark Weisbrot & Luis Sandoval, Bolivia's Economy -An Update, (August 2007).

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