Banana Republic

united fruit company

Banana republic is a pejorative name for a country which has an unstable government, high corruption and which largely depends on agriculture, such as growing bananas. There are subject to frequent coups. The ‘original Banana republic is Honduras. In the early 20th century the United Fruit Company had much influence in the country, even deposing a president and installing a new one over taxes.

The first known use of the term was by American author O. Henry in his 1904 book of linked short stories, ‘Cabbages and Kings.’ The book is based on Henry’s 1896-97 stay in Honduras, while hiding from federal authorities for embezzlement in the United States. O.Henry used the term to refer to a ‘servile dictatorship’ which directly supported large-scale plantation agriculture in return for payments or gifts.

They are politically unstable countries that economically depend upon the exports of a limited resource (e.g. fruits, minerals), which usually have an impoverished working class who are ruled by a wealthy élite. In political science, banana republic denotes a country dependent upon limited primary-sector productions, which is ruled by a plutocracy who exploit the national economy by means of a politico-economic oligarchy. In American literature, banana republic originally denoted the fictional ‘Republic of Anchuria,’ a ‘servile dictatorship’ that abetted, or supported for kickbacks, the exploitation of large-scale plantation agriculture, especially banana cultivation.

In practice, a banana republic is a country operated as a commercial enterprise for private profit, effected by the collusion between the State and favored monopolies, whereby the profits derived from private exploitation of public lands is private property, and the debts incurred are public responsibility. Such an imbalanced economy reduces the national currency to devalued paper-money, hence, the country is ineligible for international development credit and remains limited by the uneven economic development of town and country. Kleptocracy, government by thieves, features influential government employees exploiting their posts for personal gain (embezzlement, fraud, bribery, etc.), with the resultant deficit repaid by the native working people who ‘earn money,’ rather than ‘make money.’ Because of foreign (corporate) manipulation, the government is unaccountable to its nation, the country’s private sector–public sector corruption operates the banana republic, thus, the national legislature usually are for sale, and function mostly as ceremonial government.

The concept of the banana republic originated with the introduction of the banana fruit to Europe in 1870, by Captain Lorenzo D. Baker, of the ship ‘The Telegraph,’ who initially bought bananas in Jamaica and sold them in Boston at a 1,000 per cent profit. Yet, the banana business was incidentally established by the American railroad tycoons Henry Meigs and his nephew, Minor C. Keith, who, in 1873, started banana plantations, initially along the railroads, to feed the workers; upon grasping the potential profitability of bananas sold in the U.S., they also began exporting the fruit to the Southeastern United States. In the event, Keith founded the Tropical Trading and Transport Company, half of the future corporate merger that established the United Fruit Company in 1899; of which Minor C. Keith later became vice president.

Dietarily, the banana proved a popular food with Americans, because it was a tropical fruit cheaper than local U.S. fruit, such as the apple; in 1913, a dozen bananas sold for twenty-five cents, while the same money bought only two apples. The exporters profited from such low U.S. prices because the banana companies, via manipulation of the national land use laws of the producing countries, could cheaply buy large tracts of agricultural land for banana plantations in the Caribbean, Central American, and South American countries, and employ the native peoples as cheap, manual labourers, after having rendered them landless. In 1899, the largest banana company, the United Fruit Company (Chiquita Brands International), resulted from a merger between Andrew Preston’s Boston Fruit Company and Minor C. Keith’s Tropical Trading and Transport Company; by the 1930s, the international politico-economic influence of the United Fruit Company granted it control of 80–90 per cent of the U.S. banana trade. Nonetheless, in 1924, the Vaccaro Brothers established the Standard Fruit Company (Dole Food Company) to export Honduran bananas to New Orleans.

In the late 19th century, the United Fruit Company, the Standard Fruit Company, and Sam Zemurray’s Cuyamel Fruit Company dominated the Honduran economy’s key banana-export sector and the national infrastructure (e.g. railroads and ports). Moreover, El Pulpo (The Octopus). was the nickname of the United Fruit Company, because it freely interfered — sometimes violently — with Honduran national politics. In 1910, the businessman Sam Zemurray hired mercenaries, led by ‘General’ Lee Christmas, an American mercenary soldier from New Orleans, to effect a coup d’état in Honduras, and install a government more amenable to the business interests of the Cuyamel Fruit Company. Yet, twenty-three years later, by means of a hostile takeover, Sam Zemurray assumed control of the rival United Fruit Company, in 1933.

In the mid 20th century, during the 1950s, the United Fruit Company convinced the administrations of U.S. presidents Harry Truman and Dwight Eisenhower that the popular government of Colonel Jacobo Árbenz Guzmán in Guatemala was secretly pro-Soviet, for having expropriated unused ‘fruit company lands’ to landless peasants. In the Cold War context of the pro-active anti-Communism of the Senator McCarthy era of U.S. national politics, said geopolitical consideration facilitated President Eisenhower’s ordering the CIA’s Guatemalan coup d’état (1954), which deposed the elected government of President–Colonel Jacobo Árbenz Guzmán, and installed the pro-business government of Colonel Carlos Castillo Armas. The poet Pablo Neruda denounced foreign banana companies’ political dominance of Latin American countries with the poem ‘La United Fruit Co.’


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