Vulture Capitalism by Grace Blakeley

Author:Grace Blakeley
Language: eng
Format: epub
Publisher: Atria Books
Published: 2024-03-12T00:00:00+00:00

Banana Republics

One of the earliest examples of US attempts to keep down a country attempting to modernize was Guatemala—the original “banana republic.” The United Fruit Company—now known as Chiquita—began harvesting bananas in the late nineteenth century. The company had been incorporated when a US businessman was invited by the Costa Rican government to construct a railway linking the capital to the coast.65 The railway was never completed, but the bananas planted to feed the workforce on the surrounding land proved an extraordinarily profitable export. The United Fruit Company was formed in 1899; by 1900 it was the world’s largest exporter of bananas.66

The company controlled vast tracts of land across Central America, and much like Ford in the Amazon, came to run what looked like a parallel state infrastructure. It ran the Guatemalan postal service and was granted a ninety-nine-year concession to build and run the railway line from Puerto Barrios on the Atlantic to Guatemala City.67 Later, the Guatemalan government gave the UFC a concession to plant on 100 square kilometers of uncultivated land even as ordinary Guatemalans struggled to access land of their own.68

By the 1930s, the UFC was the largest single landowner, and the largest employer, in Guatemala. Much of the land it owned had been forcibly expropriated from the indigenous Maya population, with the active support of the Guatemalan state. Its workers were treated appallingly, and over the course of the 1920s and 1930s multiple strikes were organized against low wages and job cuts. Most were broken up, often with the support of the Guatemalan government.69

Large landowners—including the UFC—responded by supporting the candidacy of Jorge Ubico, who promised to clamp down on working-class and indigenous revolt. Ubico was a large landowner and an admirer of European fascism who had compared himself to Mussolini and Napoleon.70 He had risen through the ranks of the Guatemalan army after studying in the US and participated in several coups before finally taking power in 1931.71

Ubico did not disappoint his backers, and immediately set about constructing a repressive, authoritarian regime that targeted communists and the indigenous population, while consolidating the power of landowners.72 He handed over tracts of land to the UFC, granted it tax exemptions, and enabled the company’s forced expulsions of local peasants and indigenous people.73 Landownership was such a singularly important political issue that Ubico even passed a law that legalized execution by landowners protecting their property.74 Also conscious of the interests of industrialists, he began construction on a number of large infrastructure projects, many of which made use of the forced labor of peasants and indigenous people.

The actions Ubico took to consolidate the power of the UFC made him a natural ally of the US, whose political leaders approved as much of his ruthless annihilation of communists and trade unionists as they did his protection of US businesses.75 But when unrest began to mount in Guatemala during the 1940s, the US was busy dealing with the fallout of war in Europe and Japan. Cornered by the escalating power of the labor movement, and unable to rely on international support, Ubico was forced to step down.

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