Barbados is a very nice place. The water is wonderful, of course: the limestone makes it a turquoise color that simply doesn’t look real. But it isn’t just the water that makes it so nice: Quintana Roo and Yucatán also have very nice limestone-saturated water. No, what makes Barbados especially nice is the society inhabiting the island. Crime is low, human development is high, institutions seem to work. It terms of ex-colonies, it is the anti-Congo. The question is why the place is so nice.
One answer, which I find unsatisfactory, is good macroeconomic policy. In that view, Barbadian governments managed the economy particularly well after independence, and thus the island grew (relatively) rich. The problem with that view is that many of Barbados’ unique qualities emerged well before 1966. In 1960, for example, real primary school teacher salaries in Barbados were 31% higher than in Jamaica, educational spending as a % of GDP was 52% higher and real per student primary school spending was 2.3 times higher. In 1950, its GDP per capita was the third-highest in the British Caribbean, after an off-the-charts already-developed Bahamas and oil-rich Trinidad. It was a full 60% higher than Jamaica’s. Barbados and Trinidad were the only two countries in which less than 40 percent of the labor force worked in agriculture. (32% in both countries; the Jamaican number was 57%.) Lifespans at birth were five years higher than elsewhere in the Caribbean (except Trinidad) if still only 56 years. Other statistics are hard to come by, but the general impression is that for all the poverty — and it was widespread — Barbados had already diverged from the rest of the West Indies.
Except here’s the thing: if you jump backwards from 1950 to 1900, Barbados doesn’t look so special. In fact, the place was a disaster, close to becoming what we’d today call a failed state. In 1902, facing riots, assassinations and economic collapse, the U.K. would take the unprecedented step of approving the 2008 equivalent of a £164 million relief grant (measured as a percent of Britain’s GDP) ... or in purchasing-power terms the modern equivalent £125 per man, woman, and child in Barbados.
What had gone wrong?
At the turn of the century, Barbados was not a pleasant place. Subsidized European beet sugar caused sugar prices to crash during the “bounty depression” of the late nineteenth century. As a result, the financial system of the British West Indies essentially collapsed between 1884 and 1899, as the merchant houses that had provided both working and long-term capital to the sugar industry disappeared. The sugar price and resulting financial collapse drove down living standards, as plantation jobs dried up and imports (especially of food) became scarce. Reports of hardship overwhelmed the Colonial Office.
The vast majority of the black population consisted of tenants who rented small plots from nearby plantations and also worked the main estate under the “located labor” laws that required labor from tenant farmers as a condition of tenancy. Overpopulation and the located-labor laws resulted in very low wage rates. In 1900, a male Barbadian agricultural worker on the open market earned 24¢ (U.S.) per day, at a time when farm laborers in the South Atlantic region of the United States — the poorest part — earned 36¢. A craftsman in Barbados might earn twice that; a female agricultural worker less. Child labor was common, at an average wage of 3¢ per day.
Low and falling wages, not surprisingly, had a lot of bad consequences. Death rates rose from 22 per 1000 in the 1860s to 29 in 1891-95. An 1897 royal commission reported that falling wages meant that “the effort to keep the children at school is not so great as it was years ago.” Low wages also meant that undernourishment ran rampant. Barbados operated on a food deficit, growing sugar to buy food, and the small gardens of its tenants failed to make up for the lack. As a result, infant mortality was shockingly high, even by the standards of the British West Indies. In 1900-04, for example, Barbados registered an average of 282 infant deaths per 1,000. In comparison, Jamaica registered 171 and Trinidad only 162.
In fact, despite its orderly appearance and reputation, Barbados appeared to be on the brink of collapse by the turn of the century. Its revenues chiefly came from import duties on food. The colonial government, facing bankruptcy, raised tariffs in 1896, which had the result of worsening the problem of undernourishment. Unrest boiled over in 1898, when the outbreak of war between Spain and the United States sent the price of bread in Bridgetown up 20 percent. Hundreds of people organized a “potato raid” against a plantation. Three weeks later, someone shot and killed the speaker of the Barbadian assembly (and a major planter) as he rode home in his buggy from the capital. The island might have erupted had a hurricane not struck a week later, “wash[ing] away all concerns except those of immediate survival.”
London eventually approved the aforementioned relief grant. In a desperate attempt to rescue the Barbadian economy, even at the cost of weakening the island’s imperial links, the British government also entered into hurried negotiations with the United States for a treaty that would cut U.S. tariffs on Barbadian sugar to 88 percent of the prevailing rate. Unfortunately, in May 1902 the United States allowed the tariff-free entry of Puerto Rican sugar, and the following year Congress signed a treaty permitting Cuban sugar to enter at 20 percent below the prevailing rate. Not surprisingly, Barbadian sugar exports took another hit.
The Barbadian government (the Barbados parliament dates to 1639) also responded to the accelerating chaos. In 1901, the Representation of the People Act changed the franchise qualification to £50 annually from all sources or £5 in rental income from land, which allowed (very few) blacks to enter. In 1902, it established the Barbados Volunteer Force to supplement British troops. The year 1903 was relatively tranquil in Barbados, with only the usual amount of potato raids, but the outbreak of the Water Riots in Trinidad made it very clear that fragility characterized what social peace that Barbados might enjoy.
It is extremely unlikely that the British would have allowed Barbados to collapse. After all, 9% of the population was “white” and a further 24% of “mixed race,” giving parliamentarians back home strong reasons to keep the place afloat. Moreover, even had there not been a large population of self-identified “Englishmen,” neither domestic nor international politics would have made it easy for a British government walk away from its commitment to its West Indian dependency. Nor is it clear that Britain would have wanted to walk away — the number of troops needed to restore order was relatively small, as were metropolitan relief expenditures.
On the other hand, there wasn’t a lot to show that Barbados would overtake the other islands within a few decades. Yet it did. So what happened?