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Potosi mine miners approx 1989

"The billiard room is a reproduction of the Alhambra in Granada" we are told. In the study, a desk used by Napoleon rests on golden clawed feet; the entrance hall is constructed from pure Carrara marble.

The extraordinary palace has rooms that echo Versailles, corridors that mimic Venice and gardens as luxurious and carefully tended as anything the Tsars of Russia might have built for themselves at the height of their powers.

But this is not Europe; it is the Palacio Portales, in a suburb on the outskirts of Cochabamba, Bolivia. Though the city itself is fairly prosperous and rests in a fertile agricultural valley, Bolivia figures on every index among the poorest countries in the world . What then was the origin of this flamboyant and bizarre display of wealth and power?

The palace was built by Simón Patiño, though he never lived there. After all, he had several other palaces to choose from - in France and Spain - as well as the suite he occupied for fourteen years in New York’s Waldorf Astoria. Though his name is less familiar than Rockefeller or Rothschild, by 1927 Patiño was the fifth richest man in the world, his income far greater than the GNP of his impoverished country of origin. In any event, he had long since left Bolivia for Europe, where he built an empire that stretched across the world. But the source of his wealth, the foundation of his financial and industrial empire, was Bolivian tin.

There is no tin in the valleys of course. The metal lies trapped in the volcanic core of the high Andes, at altitudes over 4000 metres. To reach it you have to travel up onto the (literally) breathtaking altiplano, along roads that skirt some terrifying escarpments. Patiño himself made the journey in 1889, travelling to the town of Oruro to work in the mining supplies store of Wilhelm Fricke.

Oruro today has changed little from the town it was a century ago. A cold sharp wind blows through its streets, carrying the dust scooped from the surface of the barren brown mountains that surround it. Founded over four hundred years ago by the newly arrived Spanish conquerors, Oruro was really a satellite to the extraordinary town of Potosí - 4600 metres above sea level and the heart of the silver mining boom on which the colonial economy rested. In the late 1500s Potosí was larger than London; its population of over 50,000 included miners, speculators and all the other hangers-on that boom towns attract.

By the late 19th century, the fall in the silver price and the exhaustion of the veins of valuable metal that run through Potosí explained the decline of the region. For the vast income that the mines produced for over a century had gone to Europe, where it was spent by the newly rich Spaniards on the industrial and manufactured goods of northern Europe. Yet the hills were still full of speculators in search of the hidden shaft, the great vein that every miner dreams of. There was still some silver to be found of course, and other ores like copper and tin. But the work was brutal and harsh, and the income minimal - and it was largely indigenous people from the mountain villages who hacked at the rock for pitiful wages and under the most primitive conditions.

In 1894 Sergio Oporto came into the Fricke’s shop. He was looking for a loan - his remote plot of land on the mountain of Llallagua was producing almost nothing and he had run out of funds. Patiño offered him money in exchange for a partnership in the mine - called La Salvadora (The Saviour). Patiño’s funds came from the sale of his wife’s jewellery - he had married the 16-year-old Albita a couple of years earlier.

Within five years, La Salvadora proved to be the place of legend, the entry to a huge vein of tin ore of incredible purity. At around the same time, this base metal - previously regarded as a worthless by-product of silver - was becoming increasingly valuable. In the Spanish American war of 1898, US soldiers ate from cans; within less than twenty years, most of Europe’s youth would be doing the same as they waited for death in the trenches of the First World War.

Patiño schemed and lied to take control of all the surrounding lands, and within six years his newly established bank, the Banco Mercantil, was the largest in Bolivia. Within twelve years, his personal wealth was greater than Bolivia‘s gross national product. His Oruro house - now a museum - occupied an entire city block, and every door and window bore an invented monogram: an SP enveloped in trailing vines. Inside, the house was stuffed with French furniture, Chinese porcelain, Russian gold, German music boxes; the walls of one room boast a mural of Alpine scenes created by an imported artist. Through the windows, however, you can just see the jagged peaks of the altiplano - dry and forbidding - which provided the means to purchase this cornucopia.

By the eve of the first world war, the family had moved to Europe, as Patiño began to build a multinational empire that combined other mining interests, smelters in Britain and the U.S, and eventually shipping and transport interests. He never lost sight of what was happening in Bolivia though. As strikes gave birth to the early miners unions, Patiño extended his purchases; he bought presidents, senators, congressmen and newspaper editors. His ambition to become a Parisian aristocrat, and to marry his children to titled if penniless Spanish nobles, depended on the continuing flow of tin.

Patiño never returned to Bolivia (he died in 1947), though his body eventually found its way to the extravagant mausoleum he built in the grounds of his estate near Cochabamba. But in a sense Bolivia - or at least the products of those deep mountain chasms - found its way to him.

The struggles of the miners for decent conditions and a living wage were met with repression and violence. When the Bolivian Revolution of 1952 finally nationalised the tin mines, it was those same workers who led the movement. The tragic irony was that when they finally passed into state hands, the veins were almost exhausted - the ore contained barely 2% of tin, compared to the 68% Patiño had once enjoyed.

Today the mining towns still cling to the mountainsides; their unpaved earth streets and mud-brick houses are covered by layers of white dust. The scattered military emplacements across the open plain are relics of the days of struggle.

In the 16th century people said that if you took all the silver produced in Potosí you could build a bridge a metre wide from Bolivia to Madrid. If you took all the tin that made Patiño’s fortune you could certainly build a road that linked his palaces in Oruro, Cochabamba and Paris. It is equally certain that the traffic would only flow one way.

Tin Man, by Mike Gonzalez, was broadcast on Radio 4.

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