|Costa Rica is different from the rest of Central America, indeed from the rest of Latin America , because its people distribute their wealth, land, and power far more equitably. Its social welfare system and parliamentary democracy have no equal. This is not a new development , rather it is the result of an enduring consolidation and depending social patterns that originate from the earliest colonial days, and the result of unique geographical and cultural factors.Costa Rica, to its everlasting good fortune, was the most neglected of colonial Central America, in large part because it was farthest from the colonial governors based in Guatemala. As large-scale colonization began elsewhere, only 330 Spanish colonists claimed lands in Costa Rica by 1611, because it had neither of the two things the Spanish conquistadors wanted : mineral wealth (gold and silver), or an abundant Indian population to work their haciendas.The absence of minerals and indigenous workers meant that settlers work their own land and there was plenty of it to go around for centuries to form a huge middle class of yeoman farmers.Like Guatemala and El Salvador, Costa Rica was transformed by coffee in the nineteenth century. The brown bean attracted foreign capital and immigrant merchants, and promoted road and railroad development. But Costa Rica’s more equitable land tenure patterns and the absence of Indian-Ladino racial tension averted the class warfare and growing militarism that accompanied the coffee booms in some of its neighbors.
The greatest of the modernizers, President Tomas Guardia Gutierres, approached American engineers in 1871 to propose the building of a railroad from the settled central plateau over the rugged mountains to Puerto Limon on the Atlantic. Minor Cooper Keith won the railroad concession. He first recruited Chinese and Italian workers , and when they died by the thousands of malaria and yellow fever and walked out on strike, he imported Jamaican workmen. In one of the major engineering feats of the age, Keith completed the San Jose Puerto Limon railroad in 1890 and built himself a Costa Rican banana empire in the process. Keith connected the US fruit centers of New Orleans and Boston with San Jose, and from Costa Rica expanded his United Fruit Company to Guatemala and Honduras.
United Fruit developed an imposing influence in Costa Rica. The company ran the railroad and banana lands and funded much of the national debt.
The national labor movement built a muscle on the United Fruit company during a series of strikes that began on 1913 and continued through the 30s. The Communist Popular Vanguard led several strikes but failed in its attempt to ignite a revolution.
During a sharp downturn in coffee prices during the World War I, President Alfredo Gonzales Flores handled the economy poorly creating an income tax and using the army as a heavy handed regime that shred the principle of due process and free expression. (Regarding this last statement one of our readers, Fyodor Aadrianov, made the following comments: Don Alfredo was a civilian heading a transition government after an election in which no party won a clear majority. He was toppled by the Tinoco brothers, one of whom was his own Secretary of Defense, and the other was an officer in the now extinct C.R. Army. The Tinoco brothers ruled the country in typical Militaristic authoritarian fashion. The US government did not recognize the Tinoco regime. On the contrary, Washington backed the Gonzalez Flores administration. Woodrow Wilson’s motivation was not entirely selfless: Gonzalez Flores defended the USAmerican oil interests in the small Central American nation, while the Tinoco Brothers sided with the interests of England. The charge that he mishandled the economy by creating an income tax is also biased. He did impose tariffs on coffee exports (also heavily dominated by London economic interests) and established an incremental income tax system, but actually his tributary reforms solidified the equitable society Costa Ricans brag about, sometimes excessively. Don Alfredo moved to the US after the coup. In the US he amassed a small fortune. Upon his return to Costa Rica decades later, he privately created a successful program to care for the elderly.)
Several Latin American governments flirted with Fascist Germany and Italy during World War II. Again Costa Rica was different . President Calderon Guardia declared war on Germany even before the US, and confiscated major German properties in coffee and banking. In his government he also pushed mayor initiatives to expand health care and labor rights, creating the Social Security system with benefits unheard in Central America.
Figueres was thoroughly anti-communist. He was a pragmatist who made an alliance with more conservative coffee growers and detested the sweeping social programs and high taxes made by Calderon. In the elections of 1948 Otilio Ulate was elected but Calderon’s forces nullified the elections and arrested Ulate.
Figueres assembled a small army and rebelled and began a civil war in which the defeated Calderon where exiled with Picado , his defense minister to Mexico were Calderon’s wife gave birth to a next president of Costa Rica.
Later on the conflict between Sandinistas and Contras came over and then the President Carazo aided the Sandinistas and tried to convince them to install a democratic government but they were very radical so the government felt betrayed themselves and turned on Carazo blaming him for helping the Sandinistas .
This was the beginning of a period that would test the foundations of Costa Rica democracy.