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Samuel
Zemurray was born in Bessarabia, Russia, as Samuel Zmurri and came from a
Jewish immigrant family. In 1892 his family moved to the United States and
settled in Selina, Alabama. After their arrival, young Samuel worked for an
aged pack-peddler who bartered tinware for pigs, earning a dollar a week. In
1899 he went to Mobile, Alabama, to enter the fruit business, buying
second-hand bananas in carload lots and disposing of them to nearby dealers.
He used a railroad car for his pushcart in his first banana venture, buying
about $150 worth of bananas in Mobile and shipping them inland by Railway
Express, telegraphing grocers along the route to come to the railroad sidings
for ripe bananas. He made about $35 on his first investment.
After a few
years, Zemurray moved to New Orleans, Louisiana, where he contracted with the
United Fruit Company to sell to small dealers and peddlers bananas which had
ripened aboard ship and had to be disposed of quickly. At this time Ashbell
Hubbard had the United Fruit Company contract in Mobile, and in 1900 he and
Zemurray joined forces, purchased two tramp steamers, and began buying
cargoes from independent plantations in Honduras and selling them in Mobile
and New Orleans. He and Hubbard borrowed $2,000 and purchased 5,000 acres of
plantation land in Honduras in 1910, forming the Cuyamel Fruit Company, of
which Zemurray became president. The firm owned their land in the tiny port
of Omoa, where Zemurray built railroads over which to move his bananas, as
well as shops and a small, screened sanitary town.
Zemurray's
operations in Honduras conflicted with the US Secretary of State policy. In
those years the US and the Central American republics often reached
agreements for the payment of debt to European countries. According to some
of these agreements the US Morgan Bank would pay these countries foreign
debts, and they would re-pay the Morgan Bank by allowing its agents to sit in
the customs houses of both countries (US and the Central American republic)
and collect revenues from exports and imports. Zemurray wanted to reach his
own agreement on custom taxes with the Honduras Government and side-step with
the Morgan Bank, but he was warned by Secretary of State Philander Knox to
not continue. Zemurray told Knox that he would continue with his plan
regardless of the Morgan Bank and the Secretary of State plans. Knox,
thinking that Zemurray had some plan in mind, dispatched Secret Service
agents to monitor his activities.
Zemurray
contacted two mercenaries, Guy "Machine Gun"Molony and Lee
Christmas, plus his friend Manuel Bonilla, a former President of
Honduras. The three of them planned a secret operation in Honduras with
Zemurray's money. One night they made the Secret Service agents believe that
they were going to late night party at a New Orleans brothel. They managed to
leave the brothel without notice and took a small boat to a larger ocean yacht.
The ship sailed from New Orleans and made its slow voyage to the Honduran
coast. Molony and Christmas had brought rifles, ammunition, and a powerful
machine-gun, a novelty in those times, with which they swiftly defeated the
Honduran resistance. The local government was overthrown after six weeks.
After the attack, the Honduras President stepped down, a new election was
held, and Bonilla was elected president. Once with Bonilla in power, the
Honduras Congress approved a concession that guaranteed Zemurray a large
tract of land and waived his obligations to pay taxes for the next 25 years.
For
a time Zemurray's business continued to operate and expand up the Honduras
coast, out of the way of powerful United Fruit. However, as Cuyamel Fruit
grew, the competition between the two companies grew as well. To improve the
size and quality of his bananas, Zemurray built a very expensive irrigation
system, and in 1922 acquired the Bluefields Fruit and Steamship Company. By
1929 Cuyamel Fruit Company had thirteen steamships running between ports of Honduras
and Nicaragua and New Orleans. It also had a sugar plantation and refinery,
and in 1929, Cuyamel's stock rose while United Fruit's fell. The two
companies went into a fierce price war, until United Fruit decided that the
best option was to acquire Cuyamel. In 1930 Zemurray sold Cuyamel to United
Fruit for 300,000 shares of the latter's stock, making him United Fruit's
largest shareholder. He was also given a seat on the board of directors.
With
a fortune of over $30 million, Zemurray went into retirement in New Orleans,
but with United Fruit's stock continuing to fall, he could not stay out of
business entirely. The company's stock which had been selling for $158 in
1929 was worth only $10 in 1932. Zemurray's fortune had dwindled to two
million dollars in shares. At this point Zemurray stormed into to the board
of directors meeting. The company had long been a preserve of the Boston
elite and Daniel G. Wing, chairman of the First National Bank of Boston,
displayed his disdain by replying to Zemurray that he could not understand
his Russian accent ("Unfortunately, Mr. Zemurray, I can't understand a
word of what you say" -Wing said while smiling thinly). Zemurray was
infuriated and quickly and he went out and gathered up proxies, allowing him
to take control of the company. He famously remarked: "You gentlemen
have been fucking up this business long enough. I'm going to straighten it
out." After this, he was elected to the newly created post of managing
director in charge of operations. He continued in this post until 1938, when
he became president.
Upon
taking control of United Fruit, Zemurray made dramatic and drastic changes in
the company, firing and replacing many employees, especially in the tropical
divisions. The market reacted positively and the company's stock rose. He was
now the world's largest grower, shipper, and seller of bananas. A few months
after he took office, the Congress of Costa Rica approved a contract with
United Fruit that allowed the development of the banana industry along its Pacific
coast. This contract included 3,000 acres of land and the construction of
railroads, wharves, and other facilities. The project was completed in 1942
and cost nearly $15 million. Zemurray also expanded the company's operations
to include the production, transportation, and sale of cacao, and other
tropical products. It operated a fleet of steamships called the Great White
Fleet, the largest private fleet in the world. The Great White Fleet carried
passengers, freight, and mail between the US and the West Indies, Central and
South America, Europe, and Africa. At the end of 1940 the company owned 61
ships and chartered 11 more, and a British affiliate owned 23 ships. At the
start of the Second World War, the fleets were taken over by the American and
British governments.
By 1946 the company had 83,000 employees and owned
116,214 acres for the cultivation of bananas, 95,755 for sugar cane, and
48,260 for cacao.
Zemurray
stepped down as president of United Fruit for a year in 1948 to attend to
private business matters, then became president again until his retirement in
1951. In the banana belt of the Caribbean he was first known as "Sam,
the Banana Man," and then later as "the fish that swallowed the
whale." Zemurray was also widely known in Central America for his
philanthropic works. He created the Escuela Agrícola Panamericana in
Honduras, which was a higher education institution, financed by United Fruit,
that awarded scholarships to Latin American outstanding students willing to
study disciplines related to agriculture. The school did not accept United
Fruit employees, and was intent on improving agricultural knowledge
independent of the company. Zemurray was also behind the projects that
protected Maya ruins in lands close to the company's plantations. He established
a center for the study of Mayan art and Central American research at Tulane
University, and he created the Lancitilla Botanical Gardens in Honduras.He
also gave considerable donations in charity in the United States as well.
Other achievements were numerous: he gave the gift that permitted the opening
of the New Orleans Child Guidance Clinic; he helped to finance the liberal
magazine The Nation; and he underwrote a chair in Radcliffe's
English Department for women only. Finally, he was also an advisor of the
Board of Economic Welfare during World War II, in which he helped develop new
sources of hemp, quinine, and rubber.
After
Zemurray retired in 1951, he remained as chairman of the executive committee
of United Fruit. In that position it has been said that he had an important
role in engineering the overthrow of the government of Guatemala in 1954,
after the democratically elected President Jacobo
Arbenz began expropriating the company's plantations in order
to follow his agrarian reform project. Zemurray led a campaign that portrayed
Arbenz as a dangerous Communist in the
American media. Working together with an advertisement company he distributed
alarmist propaganda among the press and Congressmen in which he showed
Guatemala as a foothold of the Soviet Union in the Western Hemisphere. This
campaign was eventually successful, since the CIA sponsored a military coup
against Arbenz, in which the rebels used United Fruit boats to transport troops
and ammunition. The colonel who led the coup, Carlos
Castllo, set back Arbenz labor and agrarian reforms and harshly
repressed the opposition. In 1961, United Fruit also provided two ships for
the disastrous Bay of Pigs invasion of Cuba.
Zemurray
married Sarah Weinberger in 1904 and had a daughter and a son. His son was
killed during World War II while serving in the Air Force.
Source:
Bibliography: INGHAM, John N.
(ed.), Biographical Dictionary of American Business Leaders(Westport,
CT: Greenwood Press, 1983); MCCANN, Thomas, An American Company: The
Tragedy of United Fruit (New York: Crown, 1976); SCHLESSINGER,
Stephen & Stephen KINZER, Bitter Fruit (New York:
Anchor, 1983).
©
united fruit historical society, 2001
For
a number of years, our CIA was involved in the overthrow of foreign
governments whose goals did not match
ours. As a result, our foreign policy actions in Central and South America
have produced repercussions that continue to the present day – and a lot of
the blame can be attributed to the “banana man”, Samuel Zemurrya, but Elliot
Abrams has also had a role. If you have no idea who HE is, the video below
will help to explain his role:
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