The Fish That Ate the Whale (15 page)

I know how often Zemurray traveled back and forth because I've seen the manifests filled out at each port, the stack of paper that charts his endless crossing. He was a perfect example of the Wandering Jew, always going but never arriving, living out of a steamer trunk, changing twice before dinner, never settled on any one part of the planet, never living at any one time of the day.

Whenever he arrived in Honduras, word spread through the plantation:
the old man is back!
He was respected because he understood the trade. By the time he was forty, he had served in every position, from fruit jobber to boss. He worked on the docks, on the ships and railroads, in the fields and warehouses. He had ridden the mules. He had managed the fruit and money, the mercenaries and government men. He understood the meaning of every change in the weather, the significance of every date on the calendar. There was not a job he could not do, nor a task he could not accomplish. (He considered it a secret of his success.) He was up every morning at dawn, having breakfast, standing on his head, walking in the fields. As far as possible, he refrained from giving interviews, addressing shareholders, or attending functions, all of which took him away from his work. He was one of those men who toiled all day every day until they had to be rolled away in a chair. When he failed to appear at a reception in Havana, Cuba, which had been thrown in his honor, a lieutenant tracked him down to the wharf, where he was going over manifest documents with a ship's purser.

He was wildly ambitious and innovated like mad. As soon as he had full control of his company, he began to visit boatyards. He wanted to build a fleet so he would never again be dependent on other companies to haul his product. I have a list of the ships he purchased: the
Jamaica
, the
Lempira
, the
Omoa
, the
Maya
, the
Augusta
. He had acquired twenty by 1915. Most of these were steamships, ice sheathed in the harbors of New York and Boston, sweating in the humidity of New Orleans and Puerto Cortés. The decks were fitted with loaders, the holds refrigerated. Soon after being stowed, the bananas were “put to sleep,” the temperature never allowed to climb above 56 degrees. Many ships were purchased from rival companies that had discontinued a route. Some were in service with Cuyamel for only a year before an upgrade made them obsolete. In 1921, Zemurray acquired the entire fleet of the Bluefields Fruit Company, the property of his father-in-law. By then, the Cuyamel fleet had become a familiar sight on the New Orleans waterfront, where people referred to it affectionately as the Little Navy.

Around this time, Zemurray moved his headquarters in Honduras from Omoa to Puerto Cortés, where he built a modern pier that went out past the shallows a quarter mile into the sea. The company grew and grew, acquiring more and more land in Honduras but also in Nicaragua and Mexico. Following the example of United Fruit, he began to invest in other crops: coconuts and pineapples, palm oil, cattle, timber, and sugarcane. It was a hedge against hurricane and drought, as well as the ups and downs of the market. It was sugarcane, a staple that sells in quantity regardless of the economy, that got Cuyamel through the First World War, when many of the company's ships were impressed for service in the U.S. Navy.

Of course, the most important tests of leadership are intangible: How do you handle a crisis, sweet-talk a landowner, manage the rough stuff? Can you stand up to the goons, face down the mercenary who overstays his welcome? Can you figure out whom to bribe and make it stick? Can you plunge the machete all the way to the Collins? Zemurray was like a character out of Damon Runyon or Saul Bellow. He could play as dirty as anyone else in the game. (Had he been born in Chicago, they would have called him Nails.) If you saw him talking to a crew boss, sleeves rolled back, black eyes narrowed, neck thick and freckled from the sun, every atom in your body would tell you to stay away. That's why Minor Keith never underestimated Zemurray. He recognized him as one of his own, a throwback to the sort of men who built the industry, who went into the jungle with nothing but trinkets and came out with a million dollars. The banana business might be respectable in the North, but it was rough and lawless in the South.

Like every other enterprise on the isthmus, Cuyamel was built on the kickback, the bribe, the threat delivered in symbols: the photo with a face blacked out, the scythe busted in two. Zemurray often implied that his deals were backed by the U.S. Navy. In other words, he threatened. He did not raise his voice when he made these threats, though he did swear with great exuberance. He whispered so people would have to lean close and concentrate on each word. When he said something was going to happen, it usually did. Even if you were a friend, you would be roughly handled if you got in his way. A State Department document chronicles a conversation a U.S. diplomat had with Zemurray concerning a loan Sam made to the government of Honduras. When Zemurray asked if the U.S. government could help collect, the diplomat spoke vaguely of the Hague Convention, which might technically allow it. “Mr. Zemurray was pleased upon learning of this Hague Convention,” the official reported, “and seemed to think it afforded a satisfactory guarantee.” It was not American action that Zemurray wanted. It was the credible threat of such action, which might be achieved by the simple spectacle of Sam huddled with a diplomat in the dark corner of the bar.

Zemurray was direct in a way that could come across as ruthless. Speaking of Nicaragua, he notoriously said, “A mule costs more than a deputy.” These words have been quoted again and again, in pamphlets, articles, and books—nailed forever to his forehead, thrown around him like a cape. They are said to tell everything you need to know about the Banana Man: the callous indifference, the contempt for life, the sort of corruption that borders on evil. Though Zemurray denied speaking these words—it's the sort of thing that enters the record because it's what people imagine him saying—let's for a moment accept the sentiment as his: A mule costs more than a deputy.

Are these words evil, or are they a simple statement of fact?

If a man wanted to do business in Nicaragua, there were certain things he had to buy—these included banana mules and police deputies. When balancing the books, you could not miss the fact: a mule did indeed cost more than a deputy.

Frank Brogan told me the following story: “Jake Weinberger came out of retirement and got a nice little banana business going with his son Leopold. Not that they grew the fruit: they bought and sold it. But Mr. Zemurray didn't want them competing, particularly in New Orleans and Mobile where Jake was selling at a low price. So he went to his father-in-law and said, ‘Look, Jake, I want you out of business. I'm going to give you money so you'll be just fine, but I don't want you fooling with price. I want to set the price.' Jake said, ‘I'm not going to give it up. I'm making money.' Sam said, ‘Well, Jake, you either get out or I'm going to cut my price and drive you out and you'll be ruined.'”

Thinking about Sam Zemurray's career, I ask myself: Just who was this man and where does he fit in the history of the isthmus? Was he akin to the conquistadores, who came and devastated and set themselves up as aristocrats? Or is this a pirate story? Was he akin to Captain Morgan and Jean Lafitte, arriving with a navy to plunder the Spanish Main? Is he Francis Drake in search of the golden city, for Zemurray, too, sought his fortune in the jungles of the New World? Or is he a Yankee businessman building a multinational company, everywhere and nowhere, whose sins are the sins of capitalism?

I think Zemurray was a transitional figure, a bridge between the world of the privateer and the world of high finance. Cuyamel was not faceless in the way of many modern corporations—Sam's face was, if anything, too much in evidence. The culture of Cuyamel was his personality. That was the company's great achievement and its great failing. Its triumphs and overreaching were the triumphs and overreaching of a single human will. It's why his company was less sinful than many of the other banana companies. Unlike other bosses, Zemurray lived in the jungle with his workers, spoke their language, knew what they wanted and what scared them. (As Zemurray liked to say, “You're there, we're here.”) It's why he was hated and why he was loved. Because he was a person and a person you can disagree with and be angry at but still admire, whereas United Fruit was faceless in a way that terrifies. It's why banana workers rallied to the big Russian as their own hedge against El Pulpo. It's why some people in Honduras still speak of Samuel Zemurray with rueful affection.

By 1925, Zemurray had paid off his creditors, was free and clear. He invested most of his profit back in the business. Cuyamel was the rising star of the banana trade, the first company to challenge United Fruit in a generation. It was not about numbers. When it came to market share and volume, U.F. was as dominant as ever. Cuyamel was harvesting eight million bunches a year, United Fruit was harvesting forty million; Cuyamel employed 10,000 workers, United Fruit employed 150,000; Cuyamel had a working capital of $3 million, United Fruit had a working capital of $27 million. It was about profit margin, the efficiency of trade, the morale and skill of the employees. It was increasingly clear: Samuel Zemurray had built the better business.

Cuyamel was superior to United Fruit in a dozen ways that did not show up on a balance sheet. U.F. was a conglomerate, a collection of firms bought up and slapped together. There was a lot of redundancy, duplication of tasks, divisions working against divisions, rivalries, confusing chains of command. Cuyamel Fruit was the Green Bay Packers by comparison. Every decision was made with confidence and authority. Zemurray could move without waiting for permission or a committee report. He could take risks without fear of losing his job. He could hire or fire with surety because he actually lived in Honduras and knew the situation on the ground. It was a contrast of styles: the executives who ran United Fruit had taken over from the founders and were less interested in risking than in preserving. Zemurray
was
the founder, forever on the attack, at work, in progress, growing by trial and error, ready to gamble it all. The difference was best seen on the plantations, where Zemurray was constantly inventing. Most people, looking at a banana, see a delicious fruit. When Zemurray looked at a banana, he saw room for improvement. He innovated banana farming, which had not changed since the first days of the trade, in the following ways:

•   
Selective pruning
   His men walked the fields, ripping out runts and dwarfs, which was seen by some as madness.

•   
Drainage
   Most banana plantations were built in river valleys, which offered natural drainage. Zemurray augmented this with spillways and canals, making good drainage better.

•   
Silting
   United Fruit built levees to prevent its fields from flooding. Zemurray allowed certain fields to be inundated, resulting in an accretion of silt, an excellent fertilizer.

•   
Staking
   At Cuyamel, each tree was tied to a length of bamboo, which protected stems against high winds and kept them on the straight and narrow.

•   
Overhead irrigation
   Traditional banana men considered watering a waste of resources, since the sky delivered two hundred inches of rain a year. Zemurray argued that, as all that rain was not evenly distributed, with the wet season followed by two months of scorchers, the sky could use some help. He filled fields with overhead sprinklers that mimicked the fall of rain and went on with a click.

The result was banana plants exploding with bunches, each filled with the fattest fingers anyone had ever seen. It was not a matter of measurements: you could tell just by looking.

The most ambitious banana men began to flock to Zemurray. Dozens of them quit United Fruit and caught a ride to Puerto Cortés. Cuyamel was hungry in a way that United Fruit had not been since the retirement of Minor Keith. It was more profitable, too, its share price climbing as the price of U.F. slumped. Zemurray was at first slow to hire these turncoats, suspecting a trick. But when Victor Cutter, who succeeded Andrew Preston as president of United Fruit, denounced the traitors, Zemurray began to actively court U.F.'s top talent. He told a reporter he loved “poking the monster in the knees.”

Victor Cutter was driven to distraction by Zemurray. Had he waited all these years to run United Fruit just to be humiliated by a fruit jobber? Cutter bad-mouthed Cuyamel, but nothing stuck. People on the isthmus championed Zemurray as their only protection against El Pulpo. “The press and analysts of economic affairs liked Zemurray,” Peter Chapman explains in
Bananas: How the United Fruit Company Shaped the World.
“He didn't seek publicity but, when he got it, it portrayed him in his favored guise as the small guy pitted against unfavorable odds.”

Whenever previously challenged, United Fruit had responded in one of two ways: buyout or crush. In 1925, Victor Cutter tried the first option, dispatching Bradley Palmer, a prominent company officer, to talk terms with Zemurray.

Turning down the offer, Zemurray said, “Hell, I'm having so much fun, and I'm a young man. Why should I quit?”

 

12

The Banana War

A corporation ages like a person. As the years go by and the founders die off, making way for the bureaucrats of the second and third generations, the ecstatic, risk-taking, just-for-the-hell-of-it spirit that built the company gives way to a comfortable middle age. Where the firm had been forward looking and creative, it becomes self-conscious in the way of a man, pestering itself with dozens of questions before it can act.
How will it look? What will they say?
If the business is wealthy and strong, the executives who come to power in these later generations will be characterized by the worst kind of self-confidence: they think the money will always by there because it always has been. They sit in their private clubs and railroad cars, saying, “Everyone knows all the land north of the Utila belongs to the company.” Or, “What's that little Russian up to now?”