Everything Everywhere Daily: History, Science, Geography & More - Banana Republics

Episode Date: December 2, 2021

The term “banana republic” is often used pejoratively to describe small, poor, unstable developing countries. Being called a banana republic is never a good thing. However, that term has a very real origin which involved actual bananas, mercenaries, corporate money, and the American government. Learn more about Banana Republics, where the name comes from, and the history behind them, on this episode of Everything Everywhere Daily. Learn more about your ad choices. Visit megaphone.fm/adchoices

The term Banana Republic has often been used pejoratively to describe small, poor, unstable, developing countries. Being called a Banana Republic is never a good thing. However, that term has a very real origin, which involved actual bananas, mercenaries, corporate money, and the American government. Learn more about Banana Republics, where the name came from and the history behind it on this episode of Everything Everywhere Daily. Do you ever climb into bed ready to sleep only to have your mind start racing the moment your head hits the pillow? Thoughts bouncing around, replaying the day, or jumping ahead to tomorrow? That is exactly why Catherine Nikolai created Nothing Much Happens. Each episode is a gentle, cozy bedtime story where, well, nothing much happens. No drama, no

tension, nothing you need to follow closely. Just soft narration, calming repetition, and soothing sensory details designed to help your mind slow down and your body relax. It's not about entertainment, it's about rest. And millions of listeners around the world, and old use it every night to quiet their thoughts and finally fall asleep. If you've ever struggled to shut your brain off at night, this might be exactly what you've been missing. You can listen to Nothing Much Happens wherever you get your podcasts. Episodes are every Monday and Thursday. To understand the origin of the phrase Banana Republic, we have to start, not surprisingly,

with bananas, literal bananas. Bananas are tropical fruit, and as such, they weren't really part of the diets of most people in the United States, even through the Civil War. odds are most Americans probably never saw, let alone tasted a banana in their entire lives at that point. In tropical areas, however, bananas grew in abundance, and they were really cheap to grow. I'll do an entire episode about bananas at a later time, and they're far more interesting of a subject than you probably realize. However, for our purposes in this episode, bananas became extremely popular in the U.S. and very cheap. In 1913, for example, you could buy a dozen bananas for only 25 cents, but the same amount would only get you two apples. Perhaps most importantly, bananas were insanely profitable. Despite how cheaply they could be

sold in the U.S., the markup on bananas was many hundred percent. This led to the creation of fruit companies run by American businessmen who began to dominate the tropical fruit business. The Boston Fruit Company initially dominated the business in the Caribbean. It was founded by a junior assistant produce seller named Andrew Preston. He got a loan of $18,000 and began importing bananas into the United States, as well as developing markets for people to buy bananas. He also pioneered the refrigeration of bananas to extend their shelf life so they could be sent further than port areas. In Costa Rica, a Brooklynite by the name of Minor Keith got a contract to build a railroad in the country. Costa Rica was very poor at the time and couldn't afford

to build on themselves, so they granted him a 99-year lease on 800,000 acres of land to build the tracks from the capital of San Jose to the port of Limon on the Caribbean side. Keith soon realized that he could grow bananas on the land on either side of the train track and then used the train to transport the bananas to port. After a period of consolidation in the industry, by the end of the 19th century, there were only a handful of companies that dominated the entire fruit business. In 1899, the United Fruit Company was created with a merger of Keith's Central American operations and Preston's Caribbean operations.

The United Fruit Company controlled over 80% of the banana business in the United States after buying up over a dozen of their competitors. These fruit companies were highly vertical operations. They owned the plantations, harvested the bananas, and also transported and imported them into the United States. The system used in Costa Rica of exchanging railroad construction for land and tax breaks was repeated in Guatemala and Honduras, both of whom, like Costa Rica, had very little money yet wanted infrastructure.

In Honduras, the United Fruit Company was given 2,000 acres for each mile of railroad track that they laid, and they didn't bother to even hook up the capital city of Tagusa Gulpa. In 1902 in Honduras, the government gave a Philadelphia businessman named William Strech a huge land concession for building just a five-mile railroad between the towns of Kuyahmel to Veracruz. Enter onto the scene, Samuel Zamuri.

He was a banana push-card operator in Mobile, Alabama, who began selling bananas from the United Fruit Company, which ripened too early, that otherwise would have been thrown away. away. He bought them at a discount and created his own supply chain in Alabama up the railroad routes. The United Fruit Company didn't like being undercut by their own product, so they agreed to loan him money to buy out the lands that William Streach had in Honduras in exchange for canceling his contract. His business in Honduras exploded, going from 336,000 bunches of bananas

in 1903 to 1.75 million bunches in 1910. He then created the Kuomel Fruit Company. So far in the story, you have some banana tycoons, land deals that are a bit shady and perhaps exploitive, and a significant amount of corruption in the banana growing countries. What really made the phrase, Banana Republic Have Some Teeth, occurred in 1911. Honduras had gotten itself heavily into debt trying to build a railroad from their Pacific to Caribbean sides. The United Fruit Company worked to secure loans from the U.S. to Honduras in exchange for an exclusive right to export Honduran bananas.

There was another fruit company established in Honduras called the Vicaro Brothers, which was granted a railway, and no other company could build another railway within 20 kilometers of them. Zemuri and his Kuyamel Fruit Company weren't going to have any of that, so he recruited the former Honduran president Manuel Bonilla, an American mercenary named General Lee Christmas, and several hundred soldiers for hire and led a coup d'etat against the Honduran government. After that, Honduras was unable to raise foreign debt, which greatly reduced the ability of their economy to grow.

General Lee Christmas was literally named the head of the Honduran military, and the U.S. dollar became the official currency in the country. With an incredibly friendly government put in place by one of the fruit companies, they were able to get laws passed to control labor and wage rates and pretty much controlled all of the infrastructure in the country. In 1916, the U.S. Embassy in Honduras actually went so far as to report, quote, the territory controlled by the Kuomel Fruit Company is a state itself within another state. It houses its employees, cultivates plantations, operate trailroads, stations,

steamship lines, potable water systems, power plants, commissaries, and clubs. End quote. Despite the actions of Zamui and the Kui Mell Fruit Company, they were still much smaller than the United Fruit Company. The Kuyamil Fruit Company, the United Fruit Company, and the Vakaro Brothers fought for control of the Honduran market. In 1924, the Vakaro brothers changed the name of their company to Standard Fruit. In 1929, after the stock market crash, the United Fruit Company purchased the Kuyamil Fruit

company, increasing their power even further. Zamuri became a minority shareholder and technically retired. However, during the Depression, the stock price kept falling, and Zamori eventually acquired a controlling interest in United Fruit. He became the CEO from 1933 to 1954. At this time, the banana business was basically a duopoly between United Fruit and Standard Fruit, and Honduras was the largest banana producer in the world. The influence and manipulation of the countries in the region never really stopped.

Hondurans actually named the United Fruit Company El Pupo, which means the octopus, because it had its tentacles everywhere. In Guatemala, the story was similar. United Fruit was given a contract to actually run the post office in 1901 and then ran the telegraph service in the country as well. Just 2% of the farms in Guatemala owned 65% of all the farmland, and the largest landowner in Guatemala was United Fruit. Their ability to control Guatemala was due to propping up a series of dictators in the country that were favorable to the U.S. United Fruit Company. This didn't end in the 20s or 30s. As late as 1954, Zamorey and the United Fruit Company pressured the Eisenhower administration to support a coup against the Guatemalan president,

Hakabo Arbenz Guzman. A somewhat similar story can be told in other Central American countries as well. The fruit companies were responsible for the 1934 Great Banana Strike in Costa Rica. In 1928, United Fruit was behind an event called the Banana Massacre in Colombia that killed several hundred striking workers. The United States military occupied Nicaragua from 1912 to 1933 and the Dominican Republic from 1916 to 1924. The U.S. military was involved in seven separate occasions in Honduras from 1903 to 1925. These are collectively known as the Banana Wars. The actual phrase Banana Republic was coined by the writer O. Henry.

He published a book in 1904 titled Cabbage's and Kings, where he wrote of a fictional country called the Republic of Anturia, which he described as a, quote, small maritime banana republic. He was very clearly referring to the country where he was residing at the time, Honduras. The fruit companies do not hold nearly as much power today. However, they still exist only with different names. The United Fruit Company is now known as Chiquita. The Stanford Food Company was purchased by Dull Foods, which has their own sorted history in Hawaii,

which will be the subject of a future episode. Once you know the history behind the term Banana Republic, it makes its selection as the name of a clothing store chain all the more puzzling. The Banana Republic period in Central America and the Caribbean still has a legacy today. The control and influence of fruit companies for almost a century impeded the economic growth of these countries, which is still reflected in their level of economic development in the 21st century. The associate producers of Everything Everywhere Daily are Peter Bennett and Thor Thompson. If you'd like to support the show, please join the list of patrons over at patreon.com.

And also remember, if you leave a review or send me a question, you two can have it read on the show.