Stories from Deli

Stuart Hotchkiss, 1924

The area, about which I am going to speak and from which our experience has been gleaned, comprises 110,000 acres. Of this area, 88,000 acres are in Sumatra and 22,000 acres in the Federated Malay States. There are planted about 50,000 acres in Sumatra and 10,000 acres in the Malay States.

In the Dutch East Indies, no titles to land are given in fee simple, but concessions for specified areas and fixed periods, of say 75 years, are granted, either by the Dutch Government directs or by the native Sultan, with the approval of the Government. Rentals are fixed from time to time in different localities, ranging anywhere from 16 cents gold to 50 cents gold per acre per year. In Malaya, conditions vary in the different federated and non-federated states, but in the case of concessions, the grant is usually for longer periods, and in some cases, actual ownership is possible. Here, as in Sumatra, the State Government receives a specified price per acre, which is continually being increased as available lands be- come scarcer.

The present price of land in the state of Kedah, in which we are now operating, is close to $20 gold per acre. You will see by that that rubber lands, even in the jungle, have a very decided value. In all, there are about 3,500,000 acres of rubber planted in the East, of which about 2,500,000 acres are in British territory, 900,000 acres in the Dutch East Indies and the balance principally in Indo-China.

ORGANIZATION

 In creating a vast enterprise in a tropical country 12,000 miles from home, success or failure hinges largely upon the organization that it is possible to build up. It requires a most careful selection in choosing the staff because mistakes cannot be as quickly rectified as is possible at home and intimate control is far more difficult. Generally speaking, pioneer work attracts men of unusual individuality, and this type is apt to be difficult to hold together in a homogeneous machine. There must be scientists, engineers, practical planters and, last but not least, accountants, for vast sums of money can easily be lost through laxity of method as well as through errors in technical judgment. The industry is still young, but already much has been learned so that it is now possible to avoid many of the mistakes made in earlier days. This applies not only to the personal equation but to the selection of suitable areas to the stock to be used in planting and also to the technique of tapping.

The technical men may be engaged in the United States or Europe, but the responsibility of recruiting the labor force rests with the managers in the East. In Sumatra, where we have planted roughly 70 square miles in one block, or very nearly the equivalent of a strip of land a mile wide extending from New York to New Haven, we are dependent primarily upon contract Javanese coolies. These are recruited in and transported from Java, which in point of time is almost equivalent to importing labor from Ireland to Massachusetts. Malaya and Java estates are operated with free labor. I shall have more to say regarding the relative merits of the two labor systems a little later on.

LABOR

Reverting again to the question of labor, I have already mentioned that the indentured system is still in vogue in Sumatra and it is to be hoped, in the interest of both laborer and planter, that the present system will not be interfered with by legislation. This does not mean that there is no free labor in Sumatra, for there is always a substantial number of Chinese, principally engaged on tobacco estates, and Javanese, who settle in the country after their terms of contract have expired. The agitation against the Penal Sanction, as contract labor is called, is due in the main to a lack of understand- ing as to what it really means.

For this reason, a brief description of conditions as they exist may be of interest. The coolies agree to enter the service of a certain employer for a period of three years at a fixed wage. If they break their contract and abscond, their employer is protected in his agreement by their arrest and return to the estate, but there are comparatively very few cases where the law has to be invoked. It is sometimes contended that coolies are bribed to sign contracts which they do not understand and thus become virtual slaves. This condition may have existed years ago, but it is absolutely impossible today. In fact, Government labor laws and regulations are so stringent that it is sometimes very difficult for planters to maintain proper discipline. We had a case a year or two ago where a coolie attempted to wreck one of our trains. He was caught after several unsuccessful attempts. Upon being brought before the Dutch magistrate, he was discharged with a fine of 40 cents gold on the ground that he was a poor ignorant coolie and did not know any better.

The difficulty of maintaining discipline is really one of the great problems that confront the management at the present time, due to the rigidness of Government control which is all in favor of the coolie. We are not disposed to quarrel with this rigidness because, after all, while we may regard it as now unnecessary, it undoubtedly has a good effect in preventing a reversion to some of the old abuses that existed on plantations in the past. The labor agreement is signed in the presence of the governmental controller of the district in which the coolie lives and he sees to it that there is no misunderstanding. Moreover, news spreads with almost telegraphic rapidity among the Javanese, as with many other primitive peoples. The coolies returning to Java at the expiration of their contracts would very quickly disseminate and exaggerate any stories of bad treatment or misrepresentation, and recruiting would stop automatically.

As a matter of fact, the indentured labor is much better off on an estate than in their own unsanitary kampongs. The dwellings provided for them are well arranged and clean; they have the best of medical attendance and are assured of an ample supply of good and nourishing food. In the case of the Holland American Plantations Company, the largest of our operating subsidiaries, food is not only supplied at a figure averaging below cost, but the variety is regulated and the meal is prepared by company cooks. This method has been found desirable as assuring a proper diversity of diet, thus preventing beri-beri and eliminating other evils that sometimes occurred through coolies gambling away their ration, and consequently becoming undernourished, thereby being rendered more susceptible to disease.

When coolies arrive on our Sumatra estates, they are usually emaciated and, in 90 percent of the cases, weakened by the ravages of hookworm. The first step, therefore, is to put them in a rest camp for approximately a month and treat them for hookworm and any other diseases that a careful medical examination may disclose. Then, at the end of the prescribed period, they are allotted to their permanent quarters in the field. Hours of labor never exceed ten, from which the lunch period is taken, and are so regulated that the coolie has time for rest and recreation during the daylight hours; he starts the day at sunrise. The quarters are inspected daily by the assistant in charge of the division and periodically, careful medical inspection is made of each individual. In the case of any serious illness, the coolie is immediately sent to the hospital, either at his own request or by the assistant in charge. Java has a population of more than 35,000,000 in an area about equal to the state of New York.

Recruiting labor, there is handled through agencies established in that country by the Avros or Planters’ Association of the East Coast of Sumatra, and these agencies are under the strict control of the Dutch Government. The cost of recruiting plus transportation must, of course, be amortized over the life of the contract. This, at the present time, amounts to approximately $60 gold per capita. That is the investment we have in each one of our indentured laborers when we start. Men and women, both, are recruited, an effort is made to maintain the proportion of about two thirds male to one-third female labor on the estate.

The rate of wages on original employment is approximately 19 cents gold for the men and 17 cents gold for the women and is almost entirely dependent upon the price of rice. Companies in Sumatra sell rice to the coolies at a fixed price of 12 guilders per bag of 900 pounds. During the war and immediately subsequently, the cost of rice to the companies was five or six times that. Money wages, however, remained comparatively stationary, as companies granted a virtual increase through absorbing the loss incurred by selling rice at pre-war levels.

At the end of the contract, the coolies have the option either of re-engaging for a period of two years at increased wages, of remaining on the estate as free labor and continuing at their pleasure to occupy company quarters, or of being returned to their native homes in Java at company expense. About 85 percent of the men and 60 percent of the women exercise the privilege of re-engaging. The women who do not re-engage usually remain on the estate and raise their families. The coolie is always better off physically at the end of his contract, because of the personal care that he receives from both employer and Government.

It will readily be appreciated that having invested so much in labor force, the employer necessarily is induced to spend large sums to keep its unit of efficiency at the maximum. This can only be accomplished by keeping the sick and death rates at a minimum. As an estate grows older, it tends to become more healthy, for jungle clearing and malaria go hand in hand. We have gradually watched our sick rate drop from over 4 percent, which in the old days was considered excellent, down to less than one percent today, while the death rate is now running about 1.2 percent per thousand.

On the Malayan Peninsula, as I have said before, we, in common with other estates, are dependent entirely upon free labor, working preferably with Tamils and Telegus from southern India, although many Chinese are used for the heavier work of felling jungle. In Malaya, competition for labor is very keen in normal times, but the Indian is very prone to follow individual Europeans who acquire a reputation for fair and liberal treatment. For this reason, personality is an even greater asset in a manager or assistant there than in Sumatra. A free labor force is less permanent than an indentured force, so there is a gentlemen’s agreement among planters in Malaya not to deliberately crimp each other’s employees.

A company is supposed to recruit in India and transport to Malaya a number of coolies approximately equivalent to those employed in its own operations so that the total population of the Peninsula is increased with expanding operations. Indian labor is recruited by sending native Kanganis or local foremen to the different Indian villages where the Malay district, if not the individual estate, is well known by the usual native means of wireless communication.

In opening up in Malaya, it is of the greatest importance to establish a good reputation for health and congenial conditions of employment from the very first; otherwise, labor will refuse to come or, once arriving, will rapidly disperse to other more popular localities, leaving the unfortunate manager nothing to show for the expense incurred.

Conditions in Sumatra under the contract system have been generally better than in Malaya, because Malayan planters, regarding their labor force as transitory, have been unwilling to invest as heavily in permanent projects for sanitation. This condition, however, is rapidly changing for the better, and today the movement in general to regard a force as permanent in total, even if there are individual exchanges in the personnel with other estates.

Under the contract system in Sumatra, rice, the principal article of diet, is sold to the coolie at a fixed minimum price, the company absorbing any excess that it is necessary to pay on the market to secure the supply. In Ma- laya, rice, dried fish, and vegetables are sold at cost. In both places, an effort is made to give the laborers facilities for keeping their own chickens and growing vegetables.

AMUSEMENTS

Throughout the planting countries in the East, generally, encouragement is being given to the development of athletics and, at stated periods during the year, field days are held. Besides this, moving pictures are being introduced as added entertainment. The films, however, are very carefully censored and an effort is made to show nothing that will decrease the respect of the native, particularly for white women. It is curious to study the mentality of the native. One would think that seeing moving pictures of the wonders of the world would interest him, but this is not the case. All that he seems to care for is horse play of the Charlie Chaplin variety. Despite our efforts at censorship, I think that the coolie I told you about who tried to wreck the train may have got- ten his idea from the movies after all, as the explanation that he gave of his motive was that he wanted to see the smash.

HOSPITAL ORGANIZATION

Both Dutch and British laws require ample hospital facilities and these are closely supervised. A few of the larger properties, such as our big Sumatra group, maintain their own; in other cases, there are centrally located hospitals supported jointly by a number of neighboring estates. We have a hospital for Europeans with European nurses and the big central hospital for Asiatics, with nearly a thousand beds, including a maternity ward. The chief medical officers are European, supported by a staff of native assistants and dressers trained in the Dutch East Indian medical school at Batavia. The building itself is brick with tiled roofs and the operating and dressing rooms are supplied with the most modern equipment, permitting of thoroughly up-to-date treatment of any cases that may occur. The labor force of the Holland American Plantation Company numbers from 14,000, to 20,000, scattered over the seventy square miles of cultivated area, each division being connected with the central administration, both by motor roads and by narrow-gauge steam railway. Foodstuffs and supplies are distributed by these systems of communication and sick coolies are brought in by ambulances.

As previously mentioned, it is of primary importance to eliminate hookworm, as the resulting enervation renders the coolie susceptible to every other sort of more serious disease. In the old days, cholera epidemics took a heavy toll, but medical science has now provided a vaccine so that this is no longer feared. Beri-beri, which comes from eating polished rice, has also disappeared as a result of regulating diet. An epidemic of influenza proved disastrous on one occasion, and there are occasional epidemics of other diseases. Malaria is perhaps man’s worst enemy in the East, and while great progress has been made in the extermination of the mosquito, the obvious difficulties of eliminating him entirely are very great.

In this work, as well as in all other matters of sanitation and preventive medicine, it would be difficult to say too much in praise of the work of the Rockefeller Foundation and the assistance that it has rendered us in an advisory way. The laws of many of the states in Malaya prohibit the maintenance of private hospitals, requiring all very sick coolies to be transferred to nearby Government institutions. This being the case, it is only possible to maintain temporary hospitals on the estate. These Government hospitals do not compare favorably with the hospitals of Sumatra and, generally speaking, here again, the free labor in Malaya is at a disadvantage as compared with the labor across the Straits of Malacca.

We are, at the present time, opening approximately 10,000 acres of jungle in Kedah which, when completed, will be perhaps the largest single unit in Malaya. As this work progresses, an effort will be made to obtain permission to erect and maintain our own hospital, designed on most modern lines, because, here, as in Sumatra, it is to the financial interest of the company to maintain the highest degree of efficiency in its labor force.

LIFE OF THE EUROPEAN ON THE ESTATE

The average plantation manager is beginning to get old at from 40 to 45 and ready to be replaced by a younger man. He has probably come out to the East at the age of 22 or 23, served his apprenticeship of six or seven years as an assistant, learned the business and then been assigned as a manager to some small estate to begin with. Both managers and assistants are provided with free housing, medical attention and, in the case of managers, usually an automobile for transportation. The houses vary greatly on individual estates, but for the most part, they are designed for the tropics and if of good construction is exceedingly comfortable. Life is not nearly as primitive as one is apt to imagine, except in very remote and undeveloped districts, for there are many home comforts, including excellent telephone systems. There are usually good clubs within easy distance, with billiard tables, tennis courts and often golf courses, football and cricket fields.

In Sumatra, we are blessed with a beautiful hill station, Brastagi, which is easily reached. There is a hotel there and many of the companies such as ours maintain private bungalows for the use of their staff. Five thousand feet make a tremendous difference in temperature, and a few weeks of outdoor life in a temperate zone works marvels in resuscitating vigor and interest in life after a period of perhaps monotonous work in the low- lands. In the old days, young men going out expected to stay six or eight years before returning to their homes on leave, but now the period has been cut to three years (except in the case of the Dutch who usually remain about five years) and the agreements usually pr vide for six months’ leave on full pay at the expiration.

Throughout the East, generally, it is customary to pay bonuses to the staff or to allow them a percentage of the profits of the undertaking. In Sumatra we distribute, under this latter plan, 12 percent of our earnings to those engaged directly in production and bonuses up to 25 percent of their salaries to others. Life in the East, generally speaking, unfits the average man for work at home later in life; consequently, the theory is that men should leave the East with at least a modest competency, and profit-sharing and bonuses are intended to make this possible.

In addition, we have in force pension plans which benefit not only Europeans but also the coolies themselves, after service of 25 years. I think that is becoming more and more general in the East, and the coolie labor which used to be so very transitory is now becoming much more permanent. In brief, the whole managerial problem is almost analogous to handling an army; the general staff is in New York, with liaison officers in London and Amsterdam; a major general or managing director is in the East; the brigadier general is the head manager; the colonels, the managers of estates; and the captains, the assistants, who come in direct contact with their companies of laborers.

Operations of an American Rubber Company in Sumatra and the Malay Peninsula by H. Stuart Hotchkiss. The Annals of the American Academy of Political and Social Science , Mar., 1924, Vol. 112, , pp. 154-162