The Peruvian guano economy of the 19th century was a classic "boom and bust" story. In the first half of the 1800s, industrialisation and massive population growth in Europe had resulted in an enormous increase in the demand for food, which, in turn, made bird guano a prized fertiliser. At the same time, newly independent Peru—highly indebted after a lengthy war against Spanish colonial rule, but rich in high-quality guano deposits—was desperate for cash. And so a trade relationship was established whereby the Peruvian government sold the rights to carry out the exploitation of guano to European companies who, in exchange, issued guarantees for loans with banks in London and Paris. The Peruvian government, confident that the guano boom would last, borrowed more and more money, much of which was spent on vanity infrastructure projects or disappeared into corrupt channels. Hence, when the boom came to a sudden end after around 30 years (triggered mainly by the invention of synthetic fertiliser), Peru was left with nothing but more debt.
By contrasting the barren landscape of the Chincha Islands—Peru's main source of guano in the 19th century—with the Tyntesfield estate of the Gibbs family, who controlled a virtual monopoly on the global guano trade between 1842 and 1861, $tow High in Transit ($HIT) shows that unfettered economic globalisation creates a small number of winners and a much larger number of losers.
The bigger message is that modern society has not learned the lessons of globalisation. By exacerbating economic inequality and insecurity, the first great era of open markets and unrestrained capitalism in the 19th century set the scene for the 20th century’s descent into hell. Yet, as we have entered the 21st century, chauvinistic populists and authoritarian leaders— fuelled by a renewed burst of economic liberalisation over the last 25 years—are once again mobilising the losers of globalisation against representative democracy and the liberal institutions of global governance.