Colonial Rule
Though the new territory never yielded the fabled riches of the mythical El Dorado, the fertile lands provided sufficient wealth for those Spanish who chose to take advantage. The encomienda system was established and haciendas developed, producing balsam and cocoa for export (this latter proved to be a particular source of wealth, with an ever-increasing demand for the delicacy from Europe). Cattle were also introduced and flourished - the indigenous farming method of slash and burn had created fertile pastures for grazing - providing a firm source of food and income. As across Latin America, the impact of the Spanish arrival was catastrophic for the indigenous inhabitants. Susceptible to European diseases, cut off from food sources as lands were enclosed by the encomenderos , forced into a different system of beliefs, the indigenous population of El Salvador went into freefall. By the end of the sixteenth century at least half had perished. The Lencas and other groups living east of the Rio Lenca - considered by the Spanish to be more primitive and less malleable than the Pipils in the west - were particularly badly affected. The decline in the indigenous population left the Spanish encomenderos with insufficient labour to work the land. In the early years of the seventeenth century black slaves were imported, though this came to a halt in 1625 when two thousand slaves gathered in the centre of San Salvador during Semana Santa, apparently to foment rebellion. The plans came to nothing, but the slaves were henceforth considered too dangerous to use. Thereafter, the encomienda system was gradually abandoned, largely replaced by the end of the seventeenth century with a system of peonage . Work on the haciendas was rewarded by payment in vouchers, redeemable only in the hacienda shop, whose prices were set significantly higher than in the open market. Money for daily expenses, however, was advanced by the landowner, creating over time a debt that the worker, or "peon", was unable to repay and which, moreover, devolved upon his family and heirs. Haciendas became enclosed, self-sufficient worlds; the workers found all their needs provided for, but in return became reliant upon the landowner for everything and unable to leave. Workers could get ahead by serving their patron in all areas, legal or illegal, while he in turn boosted his power by commanding such resources. Such patterns were to continue in El Salvadorean society in later years - not least in the private armies, raised by landowners, that developed into the death squads of the 1970s and 1980s. From the early eighteenth century, landowners switched from the production of cocoa to that of anil ( indigo ). Although long cultivated, it was not until protection measures in the European markets were removed that it became viable to produce the crop on a large scale. Growing demand for the superior dye produced in Latin America ensured that by the mid-1700s indigo had become the primary export crop. The principal beneficiaries of this were - despite the efforts of the Spanish Crown to ensure small-scale production - the hacienda owners and comerciantes , the middle-men handling the sale and shipping of the crop. By the end of the eighteenth century El Salvador was a rigidly stratified society, whose European elite consisted of the small number of Spanish-born Crown functionaries and priests and a few hundred Creole (Latin American-born) hacienda owners and comerciantes ; these last two groups were allocated some responsibility in the management of local affairs on behalf of the Crown. Of available agricultural land, around half was held in private haciendas. The vast majority of the population, mestizo and indigenous, existed at subsistence level, cultivating maize.
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