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The Decimation of Haiti

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Summary

  • Haiti was forced to pay France an indemnity for the economic distress caused by the freeing of Haitian slaves.
  • This trapped Haiti in a 122 year long cycle of underdevelopment.
  • French banks, Wall Street, and US and French governments all took a bite of Independent Haiti.
  • US conducted a brutal occupation of Haiti from 1915 to 1934.
  • Haitian President Aristide demanded that the amount be repaid to Haiti. No repayment happened and he was ousted in a coup not long after.

Background - Pre Independence

Haiti was colonized by the French from 1659-1804. Over the ~150 years of domination, the French colonizers turned 'la Perle de la Antilles' into a sugar production factory. This profitable sugar industry was mostly sustained through slave labor, indentured servitude, and incredibly harsh working conditions. Disease and all the human suffering inherent in the enterprise of slavery and occupation were commonplace in Haiti during this period.

Slavery sustained sugar production under harsh conditions; diseases such as Malaria (brought from Africa) and Yellow Fever caused high mortality[...]. In 1787 alone, the French imported about 20,000 slaves from Africa into Saint-Domingue, while the British imported about 38,000 slaves total to all of their Caribbean colonies. The death rate from yellow fever was such that at least 50% of the slaves from Africa died within a year of arriving, so while the white planters preferred to work their slaves as hard as possible, providing them only the bare minimum of food and shelter, they calculated that it was better to get the most work out of their slaves with the lowest expense possible, since they were probably going to die of yellow fever anyway. Wikipedia - Haitian Revolution

This sugarcane monoculture, while devastating Hatian land for generations, provided a significant source of wealth and livelihood back in France.

[sugarcane monoculture] induces soil acidity, reduces soil fertility, shifts microbial structure, and reduces its activity. Furthermore, most beneficial bacterial genera decreased significantly due to sugarcane monoculture, while beneficial fungal genera showed a reverse trend (however, their changes were associated mainly with soil attributes). Research Paper on Sugarcane Monoculture

The livelihood of 1 million of the approximately 25 million people who lived in France in 1789 depended directly upon the agricultural imports from Saint-Domingue, and several million indirectly depended upon trade from the colony to maintain their standard of living. Wikipedia - Haitian Revolution

The Haitian Revolution began in 1791 and ended in 1804 with Haiti declaring independence from France. Haiti thus became the first modern nation to abolish slavery, and the second modern republic.

The French 'Debt'

Haiti holds the honor of being the first (known) post-colonial republic to be formed in the modern era. That means it was the first post colonial republic to experience the newly evolving paradigm of neo-colonialism.

While Haiti was still in the early stages of reconstruction post occupation, France came to the Haitian shores with 14 war ships, a threat, and broader European sanction:

At the Vienna Congress, in 1815, France had insisted that Saint Domingue was still a French possession (Blancpain, 2003). As a result, even though Haitians had managed to oust the French in 1804, no nation was willing to recognize Haiti’s independence. Report on Economic Impact of the Independence Debt

In the 1815 Congress of Vienna, undeterred, France negotiated a secret deal to secure “whatever means possible, including that of arms, to regain Saint-Domingue.” In 1825, [...the French] came to Haiti with an ultimatum... JSTOR - The Case for Reparations is Nothing New

France demanded that Haiti pay a reparation of 150 million francs for 'property, including slaves' in exchange for diplomatic recognition or face another war of occupation - the first wave of which was ready to fire at the Haitian shoreline. Seeing no other option, Haiti agreed to sign onto this egregious 'deal' with their former colonizers.

This momentous occasion marks the first instance (known to me) of debt being used as a tool of neo-colonial oppression. A habit that imperial powers and the imperial finance machine have refined over the centuries and continue to employ to this day.

Even with a later renegotiated amount of 90 million francs for the indemnity, the first annual payment alone was six times Haiti's annual revenue. The total value of the debt was 1.6x GDP. Haiti was forced to divert massive amounts of funds from local development to fund debt payment. Unfortunately, the debt burden was so large, that Haiti was forced to keep borrowing from Europeans and later Americans to fund interest payments. Finally, 58 years later, in 1883 Haiti finally paid off the last of it's coercive debt to France.

By the 1880s, a staggering 80 percent of national expenditures went to financing debts. The 20 percent that remained could not support internal investments in education, healthcare, public infrastructures, and other sectors.

Cash strapped and still borrowing from French and German firms to finance interest payments to the national debt, Haitian officials turned to U.S. financiers to raise funds by issuing sovereign bonds for domestic expenditures. How US Economic Imperialism Underdeveloped Haiti

However, Haiti still had to make good on all the loans it took to pay off its prior loan - effectively trapping it in a debt cycle (and low development period).

Making good on loans necessitated increased taxes on the peasants and to channel all production towards an export-oriented economy. Taxation provided the safety net that insured repayments by the state. Haitians were thus the investment, the borrower, the bond issuer, the collateral, and the guarantor, all circumscribed by a perfect hedge between the stakeholders and the state: the banks gave with one hand and took back more with the other. How US Economic Imperialism Underdeveloped Haiti

The French Banks

At the tail end of Haiti's indemnity payments to France, in 1881, a French bank - Crédit Industriel et Commercial (CIC) - established the National Bank of Haiti to serve central banking functions for the country by concession from the Haitian government. But CIC bore no responsibility to the Haitian people. They only answered to their shareholders

As the Paris Financial Association wrote in 1896: “The National Bank of Haiti is a French financial institution whose headquarters, which is open to bondholders, is in Paris. Its offices in Haiti are only branches, placed under the authority and control of the head office.”

Far from executing the functions of a central bank, they siphoned off as much as they could from Haiti's revenue, charged the Haitian government a commission for every transaction, and issued even more debt for Haiti. You can read about the whole sad affair in this NYT report.

French elites, including a descendant of one of the wealthiest slaveholders in Haiti’s history, controlled Haiti’s national bank from the French capital. Their ledgers show no investments in Haitian businesses, much less the kinds of ambitious projects that modernized Europe.

Crédit Industriel, working with corrupt members of the Haitian elite, left the country with barely anything to operate, let alone build a nation.

By the early 20th century, half of the taxes on Haiti’s coffee crop, by far its most important source of revenue, went to French investors at C.I.C. and the national bank. After Haiti’s other debts were deducted, its government was left with pennies — 6 cents of every $3 collected — to run the country.

Had the wealth siphoned off by Haiti’s national bank stayed in the country, it would have added at least $1.7 billion to Haiti’s economy over the years — more than all of the government’s revenues in 2021. NYT - French Banks in Haiti

Eventually, under pressure from the Haitian government, CIC folded National Bank of Haiti in 1910. This institution had been replaced by another with a slightly different name - Banque Nationale de la République d'Haïti (BNRH) in which France still owned a stake.

There was Haitian economic blood in the water, and the masters of modern economic imperialism wanted a bite. The United States, and specifically Wall Street, also owned a stake in BNRH.

American Imperialism

Despite the Monroe Doctrine the United States did nothing to help when France threatened Haiti in 1825. In fact, US-Haiti relations were on ice as Haiti was the first nation of emancipated slaves to be running their own government. The United States was vested in the failure of Haiti from the very beginning, so as to keep the institution of slavery thriving at home. Even as France and most of Europe diplomatically recognized Haiti in 1825, the United States held off on recognizing Haiti until 1862 while the 13th Amendment (on the abolition of slavery) was being debated in the US Congress.

US banks acquired modest stakes in BNRH in 1910 and continued to grow their footprint in subsequent years. The US government was also taking an interest in these financial instruments.

[...] the government of the United States funded the acquisition of Haiti's treasury in 1911 in order to receive interest payments related to the indemnity.

The centers of Haitian finance were completely subsumed by Wall Street firms, including Chase National Bank [and Speyer], and the BNRH’s account was contractually housed within the National City Bank’s account holders. And just as the Concert of Europe had done before them, the new shareholders made an exception clause that permitted French military intervention should Haiti fail to make repayments. How US Economic Imperialism Underdeveloped Haiti

A highly detailed account of US banks involvement in Haiti can be found here: The National City Bank of New York and Haiti, 1909–1922 - Peter James Hudson

Where an economic stake exists, it seems a political and military stake naturally follow as is evidenced in the opium wars a hundred years before and the oil wars a hundred years hence.

Haiti took on its forced debt to France and the subsequent debt cycle to avoid an invasion of its sovereign territory. But 90 years later, the invasion came. From the West instead of the East this time. American capitalists successfully lobbied the government to send the Marines to Haiti to secure their debt payments and economic interests. In December 1914, US Marines looted Haiti's strategic gold reserves at the behest of the US government and Citibank.

... Haiti's gold reserve of about US $500,000 – equivalent to $13,526,578 in 2021 – in December 1914; the gold was (placed in) Citibank's vault days later. Wikipedia - Haiti Independence Debt

Its stake in Haiti’s sovereign debt helped transform National City [Citibank] into a global financial firm. How US Economic Imperialism Underdeveloped Haiti

Emboldened by its initial invasion into Haiti, the US launched a full scale occupation of the island nation in 1915. The purported reason, used in many contexts since, was to bring democracy to the troubled island nation after the overthrow of President Vilbrun Guillaume in a coup.

The fact is that for nearly a year before the coup d'état which overthrew Guillaume, the United States had been bringing pressure on Haiti to compel that country to submit to American control. 1920 NAACP Report on US Navy occupation of Haiti

The subsequent treaties foisted upon the Haitians under military duress, along with actions that the Wilson government undertook and sanctioned belie the real American motive: economic extraction.

The Haitian American Treaty, signed in 1915 [...] gutted home rule and transferred the levers of Haitian political economy to Washington. In 1917, Wilson dissolved the Haitian legislature when lawmakers refused to adopt a new constitution that would excise the restriction on landownership by white men. [...] National elections were manipulated under the guise of democracy, even though 90 percent of the Haitian electorate was too illiterate to truly vote. How US Economic Imperialism Underdeveloped Haiti

Before we proceed, lets take a moment to acknowledge that the occupation wasn't strictly financial. There was a human and deeply racist element to the occupation of Haiti by the US Marines from 1915 to 1934. They brutally suppressed uprisings, killing thousands; and casually cultivated an environment of terror. They suppressed the expression of local culture and brought with them their American stereotypes about superiority and inferiority. Under this military government, Haiti was again being run like a colony and a plantation - land was being arbitrarily 'repossessed', food insecurity was rising, large chunks of local revenues were being appropriated for financing the occupation and paying American banks.

By 1919, Haitian Charlemagne Péralte had organized more than a thousand cacos, or armed guerrillas, to militarily oppose the marine occupation. The marines responded to the resistance with a counterinsurgency campaign that razed villages, killed thousands of Haitians

Brutalities and atrocities on the part of American Marines have occurred with sufficient frequency to bring about deep resentment and terror on the part of the Haitian people. There have been needless killings of natives by marines. I was told that some marines had cut a notch in the stocks of their rifles for each native killed. Just before I left Port-au-Prince, an American marine caught a Haitian boy stealing sugar on the wharf, and instead of arresting him, he battered his brains out with the butt of his rifle.

I learned from the lips of American marines, themselves, of a number of cases of rape on Haitian women by marines. But, perhaps, the worst phase of American brutality in Haiti is, after all, not in the individual cases of cruelty, but in the American attitude. This attitude may be illustrated by a remark made by a marine officer at another time when I was seated at a table with some Americans. We were discussing the Haitian situation when he said, “The trouble with this business is that some of these people with a little money and education, think they are as good as we are.” 1920 NAACP Report on US Navy occupation of Haiti

These were some excerpts from a report published by the NAACP in 1920. Haiti continued to tolerate this American oppression until 1934 when US finally withdrew, leaving in their wake even more economic and political uncertainty, and a string of human rights abuses.

According to Patrick Bellegarde-Smith, “as many as 600,000 peasants out of a population of 2 million may have left the country for US plantations in Cuba and the Dominican Republic as a result of land pressure, financial inducements, and US massacres. How US Economic Imperialism Underdeveloped Haiti

Haiti finally paid off the last of its foreign debt in 1947.

In 1922, BNRH was completely acquired by National City Bank, its headquarters was moved to New York City and Haiti's debt to France was moved to be paid to American investors. Under U.S. government control, a total of forty percent of Haiti's national income was designated to repay debts to American and French banks. Haiti would pay its final indemnity remittance to National City Bank in 1947, with the United Nations reporting that at that time, Haitians were "often close to the starvation level" Wikipedia - Haiti Independence Debt

Even since the debt obligation was settled, the US has not left Haiti alone. US intervention continues in the form of political meddling, 'peacekeeping' military action, and espionage.

Economic Impact and Calls for Repayment

Independent Haiti's economy is a product of the 122 years of debt, divestment, death, and devastation. In the years since 1947, Haiti has been playing catch up with the destiny it could have had.

The Haitian economy is finally growing, but the thing about investments is that they compound. For 122 years, 40% to 80% of revenue was going to wealthy French and American gentry, rather than being invested in infrastructure, healthcare, education, social security, agriculture, manufacturing, and everything else a young nation needs to survive. By every realistic metric and heuristic that you would use to compute a counter-factual economic value for Haiti in the absence of the debt, you get an economy that is anywhere from 3x to 60x the size of Haiti's current economy.

Had Haiti been allowed to paint their own future since 1825, there is no question that we would be seeing a much more prosperous nation today. In 2003, the competent and progressive left-wing President of Haiti Jean-Bertrand Aristide made a reasonable sounding request.

In 2003, President of Haiti Jean-Bertrand Aristide demanded that France pay Haiti over 21 billion U.S. dollars, what he said was the equivalent in today's money of the 90 million gold francs Haiti was forced to pay Paris after winning its freedom from France. Wikipedia - Haiti Independence Debt

Keep in mind, this amount includes no interest and is on the lower end of estimates of what France actually owes Haiti for this past extortion. France suggested they were sorry about their colonial past and that they would 'study' the requests. This French delegation study the naturally returned several reasons not to pay. Shortly after, President Aristide was ousted in a coup d'état under shady conditions.

The Ottawa Initiative, for instance, was a conference on the future of Haiti's politics that occurred a month before the alleged coup and hosted delegates from Canada, US, France, and Latin America, but no delegates from Haiti. There is evidence to suggest that the US and France were involved in this coup d'état, but no international investigation has been conducted.

In February 2004, a coup d'état occurred against President Aristide. The United Nations Security Council, of which France is a permanent member, [vetoed] a 26 February 2004, appeal from the Caribbean Community (CARICOM) for international peacekeeping forces to be sent into its member state Haiti. However, the Security Council voted unanimously to send troops into Haiti three days later, just hours after Aristide's controversial resignation. The provisional prime minister Gerard Latortue who assumed office after the coup would later rescind the reparations demand, calling it "foolish" and "illegal". Wikipedia - Haiti Independence Debt

Aristide resigned, but claims that the resignation was extorted under duress. In a corollary to this notice of resignation, he stated...

"If tonight it is my resignation that will avoid a bloodbath, I accept to leave with the hope that there will be life and not death." Wikipedia - Haitian coup d'état

remembering the [Ottawa Initiative's] immense impacts and legacy is crucial. As a result of those talks, the people of my native land went from having 7000 duly-elected officials, 20 years ago, to none, today. Black Agenda Report - 20 Years After the Ottawa Initiative

The amount was never paid back to Haiti, and no subsequent official calls have been made. Through imperialistic force and political coercion, it seems US and France have made sure such calls for reparations are suppressed at the source.

Western powers and the US in particular, continue to ignore Haiti's sovereignty. Every French administration balks at the idea that reparations are owed to Haiti. The Biden Administration's Haiti policy carries the same century old patronizing stench. To America, Haiti has always been about American security and not about Haitian prosperity.

An action you can take

Citibank stole over $500,000 of Haiti's gold reserves in 1915 If the $500,000 was invested at a very reasonable 5% annual interest rate with a 1% variance for 100 years, it would come out to $66 million in 2015.

Citibank hasn’t acknowledged its role in Haiti’s suffering, nor paid back any part of what they owe to Haitians for the wealth and resources they’ve extracted by keeping Haitians in debt Banking On Solidarity - Citibank and Haitians: A Violent History

You can sign a petition to demand reparations for Haiti from Citibank here.

Sources

All my sources are linked above. Here are a 5 that I would recommend reading in detail:

Sources I didn't use but wanted to: