Federico Echevarria’s Rally-Protest Speech in Favor of Protectionism

1. INTRODUCTION

The text we analyze is a fragment of the rally-protest speech that the Basque businessman Federico Echevarria gave in Bilbao on December 9, 1893 in favour of protectionism.

As regards the origin, it is a primary source. As regards the form, it is a public meeting/rally, then it is a narrative text; in the content, it is an economical text.

The text is addressed to the Government and to businessmen, therefore it is a public text.

The main objective of Echevarria was to eliminate free trade agreements and put pressure on the government. The text is set at the time of the Restoration and in the context of the process of industrialization in Bizkaia, specifically in the development of the struggle of businessmen in favor of protectionism.

2. CONTENT

The main idea of the text is the denunciation of the free trade agreement signed between Spain and Germany (signed by the Government of Sagasta in 1893) and the defense of protectionism (maintain the customs taxes of 1891).

The text is divided into 2 parts:

  • In the first part the mentioned agreements, cancellation of the current regulation on customs taxes, and the explanation given by the author of the consequences that would have for the Basque steel industry. This measure would endanger two aspects: on the one hand, the regulation that emerged through protectionism and, on the other hand, was remodeled by that measure. In his opinion, these agreements would make the initiatives and projects of employers void, and the industry would be mortally wounded. In addition, the signing would be a dangerous precedent and argues that it would open the door to signing similar agreements with many other states.
  • In the second part, Echevarria explains the request made to the Government, claiming that it does not depart from the regulations and does not destroy the current protection system. These words refer directly to the maintenance of the tariff set by Cánovas in 1891, putting pressure on the Government to suppress the agreement signed with Germany.

On the other hand, the conference can be taken as a call made to other entrepreneurs in Spain, so that they too will mobilize against the agreement.

3. CONTEXT

To understand the text better and be able to make the context, a series of historical references must be clarified:

– Agreement: Commercial agreement signed by Sagasta in 1893 with Germany.

– Customs tax of 1892: refers to the protectionist tariff approved by Cánovas one year before.

– Federico Echevarria: businessman from Bilbao, owner of the company Iberia and one of the founders of AHV in 1902. One of the founders of the Liberal Party of Bizkaia.

– Companies that are mentioned in the text: related to the steel sector of Bizkaia.

The conference was developed from 1880 and must be understood within the process of industrialization in Bizkaia. It is worth noting at this time the application of the new mills from Europe, such as the Bessemer converter, which took advantage of the iron from Bizkaia with excellent characteristics for the steel industry. All this together with open-pit mines, unskilled workers, very low production costs, closeness to means of transport (the Bilbao estuary) made industrial development offer excellent opportunities for the new industrial bourgeoisie for the development of steel companies in Bizkaia.

In the context of Industrialization, the steel industry played a very important role in the economic development of Bizkaia in the vicinity of the Bilbao estuary. Technology brought from England and Belgium. Thus, from 1880 the great steel mills began to be built: San Francisco de Mudela(1880), La Vizcaya (1882) and Altos Hornos de Bilbao (1882). These last two and La Iberia, united in 1902, would give rise to the largest steel company in Spain, Altos Hornos de Vizcaya (AHV)

For the consolidation and development of this sector, the protection given by the Government was fundamental. Thus, the delay that the industrialization in Bizkaia suffered with respect to Europe, made it impossible to compete as equals in the market, therefore only the Spanish market remained. This market had to be protected from European competition, and that is why the main objective of the industrial oligarchy of Bizkaia was to control the market and ensure a protectionist law that would allow it.

Although the protectionist tariff approved by the government of Cánovas in 1891 was well accepted, the concern of the Biscayan industrialists was the possibility of rejecting this tariff by signing trade agreements. And that is what happened as we discussed in this text when the government of Sagasta in 1893 signed commercial agreements with Germany and then with Italy.

This decision of the government provoked protests, such as the Federico Echevarria conference of this text. This rally-protest in favor of protectionism and thereafter the bourgeoisie of Bizkaia would force to achieve its objectives: suspend trade agreements and eliminate special tariffs on rail.

To avoid competition, the following was the concentration of companies, and in this way in 1902 Altos Hornos de Vizcaya (AHV) will emerge. This concentration brought with it the monopoly of the bourgeoisie in Bizkaia, related to the steel industry, mining and the naval sector. This oligarchy will make large investments in companies in Spain and will be linked to Spanish capitalism. To defend their interests, at the time of the Restoration they will support the regime and remain under it.

4. CONCLUSION

This rally-protest of 1893 was a milestone in favor of protectionism. Many conferences defined the characteristics of many ideological movements and will have an influence on the bourgeoisie of Bizkaia and on the opinions and decisions that you will later take: the bourgeoisie of Bizkaia will be placed in Spain at the head of the defense of the struggle for protectionism, and therefore believed that it represented all of Spain in that defense.

The fight in favor of protectionism will achieve its objectives as is verified by the context and this, with the tendency towards the concentration of companies, was fundamental in the consolidation of the Biscay oligarchy.