The banana trade and Samuel Zemurray

The banana, an exotic fruit generally grown in the tropics, was rarely available to North American and European consumers a century ago. Today, thanks to the United Fruit Company, the banana is one of the most popular and cheapest products found on supermarket shelves, having outstripped the apple as one of our favourite fruits.

Indeed, the banana, which is technically a plant rather than a tree, is now the world’s fourth major food after rice, wheat and milk.

Apart from being delicious, the banana is good for your health, containing natural sugars (which boosts energy), potassium (which regulates blood sugar levels) and fibre (which assists bowel movements).

For much of the 20th century, the United Fruit Company – founded by a pair of Bostonians but later controlled by a Jewish immigrant from Russia named Samuel Zemurray – maintained a monopoly over the cultivation and distribution of bananas.

In 1969, eight years after Zemurray’s death, the United Fruit Company was taken over by Eli Black, an investment banker and devout Jew who had been trained as a rabbi. In 1970, Black merged it with his own firm, AMK, and created the United Brands Company. Black committed suicide in 1975, jumping from the 44th floor of the Pan Am Building in Manhattan.

After his death, the billionaire investor Carl Lindner bought United Brands and renamed it Chiquita Brands International.

These are among the basic facts in Peter Chapman’s intriguing history of the United Fruit Company, Jungle Capitalists: A Story of Globalization, Greed and Revolution (Canongate).

Chapman’s book, as the title suggests, is more than an account of a multinational company that cleared rainforests and built railroads to ship its tantalizing products, mainly bananas and pineapples, to consumers.

In essence, Jungle Capitalists is the story of the birth of globalization.

With plantations throughout Latin America and the Caribbean, the United Fruit Company was a pioneer in mass production, a corporate behemoth that exerted enormous influence in such banana republics as Honduras, El Salvador, Panama and Costa Rica.

The first of the modern multinationals, it was a power onto itself, changing governments at the drop of a hat to suit its purposes.

As Chapman puts it, “United Fruit had possibly launched more exercises in ‘regime change’ on the banana’s behalf than had even been carried out in the name of oil.”

Nor was the United Fruit Company   concerned about its legion of workers, denying them such basic human rights as decent wages and health care.

The company, whose impact on Latin America was incalculable, was established by an American railroad entrepreneur, Henry Meiggs, after he bought out businessman Andrew Preston. Meiggs’ nephew, Minor Keith, subsequently took over the company.

Keith, knowing that bananas thrive in hot and damp conditions, realized that he should focus his energies in Central America.

There are more than 1,000 varieties of bananas, primarily in Africa and Asia,  but the United Fruit Company settled on the Gros Michel, or Big Mike, variety. It was reasonably tasty and arrived at its destination with less bruising due to its thicker skin.

Big Mike, having succumbed to pests in the 1950s, was replaced by a disease-resistant Chinese variety, the Cavendish. According to the writer Dan Koeppel, the Cavendish is the food equivalent of a fast-food burger: efficient to produce, uniform in quality and universally affordable.

Regardless of the variety it marketed, the United Fruit Company was a going concern, effortlessly absorbing rivals.

In 1930, Zemurray, known to all as “Sam the Banana Man,” sold his Cuyamel Fruit Company to the United Fruit Company and retired at the age of 52.

Born in Kishinev, Bessarabia, he immigrated to the United States with his impoverished parents as a teenager.

The family settled in Selma, Ala., but in 1899, Zemurray entered the fruit trade in Mobile, Ala., buying bruised bananas and selling them to second-hand dealers.

Within a few years, he moved to New Orleans, where he  befriended Keith.

A canny operator, Zemurray flourished as he and a partner bought bananas from independent growers in Honduras and sold them in Alabama and Louisiana at a tidy profit.

In 1910, having purchased 5,000 acres of land in Honduras, he formed the Cuyamel Fruit Company.

Fearing that he would be taxed to death, he appealed to the U.S. State Department for help.

His appeal having been rejected, he contacted Manuel Bonilla, a deposed Honduran president who resided in New Orleans.

In a legendary manoeuvre, he hired two mercenaries and had them smuggle Bonilla back to Honduras. With Zemurray’s financial support, Bonilla staged a coup d’etat and returned to office. Bonilla, indebted to Zemurray, granted him land concessions and waived his obligations to pay taxes for the next 25 years.

A multimillionaire, Zemurray returned to the banana business in 1933,   seizing control of the United Fruit Company in a hostile takeover. The company’s stock had dwindled in the face of mismanagement and the Depression, and Chapman describes these events at length. Zemurray ousted its board of directors, reorganized the company and made it profitable once again.

He let nothing stand in his way.

When the democratically elected president of Guatemala, Jacobo Arbenz, announced that he intended to transfer unused United Fruit Company’s land to landless peasants in an agrarian reform project, he launched a propaganda campaign against Arbenz, branding him as a communist. Zemurray’s tactic worked.  The U.S. Central Intelligence Agency sponsored a successful coup against Arbenz.

Zemurray played a more benevolent role elsewhere, helping to fund the purchase of the Exodus for the Zionist movement, Chapman notes.

Today, with Zemurray long gone and the United Fruit Company but a hazy memory, four companies rather than one dominate the banana trade: Chiquita, Del Monte, Dole and Noboa.

One wonders what Zemurray would have thought of this development in the annals of capitalism.