The Fish That Ate the Whale

by Rich Cohen

  After the fields had been planted, the plantation town was built. Most of these were like small American villages sunk in the isthmian wilderness: a crossroads, a steeple, a green; a hospital, a grocery, a five-and-dime. There was a club for top executives with a polished bar and dance floor; a club for employees of the midrank, with pool and poker tables; a club for workers with kegs of beer, whiskey, and fights. Zemurray imported boa constrictors to keep violence in check, believing the presence of the snakes would force his men to stay sober.

  He eventually built many banana towns, each laid out in the same basic pattern: the houses of the executives on a hill, the more important the executive, the higher up the hill. The manager’s house was at the peak. If the plantation had been laid on flat ground, a hill was constructed. In this way, the landscape was made to reflect the hierarchy of the company. “I noticed that the railroad depots in cowboy movies looked like our train stations,” wrote García Márquez.

  Later, when I began to read Faulkner, the small towns in his novels seemed like ours, too. And it was not surprising, for they had been built under the messianic inspiration of the United Fruit Company and in the same provisional style of a temporary camp. I remembered them all, with the church on the square and little fairy-tale houses painted in primary colors. I remembered the gangs of black laborers singing at twilight, the shanties on the estates where the field hands sat to rest and watch freight trains go by, the ditches where the morning found the cutters whose heads had been hacked off in the drunken Saturday-night brawls. I remembered the private cities of the gringos in Aracataca and Sevilla, on the other side of the railroad tracks, surrounded, like enormous electrified chicken yards, by metal fences that on cool summer dawns were black with charred swallows. I remembered their slow blue lawns with peacocks and quail, the residences with red roofs and wire grating on the windows and little round tables with folding chairs for eating on the terraces among palm trees and dusty rosebushes. Sometimes, through the wire fence, you could see the beautiful languid women in muslin dresses and wide gauze hats cutting the flowers in their gardens with golden scissors.

  Zemurray reaped his first harvest in 1910, soon after he arrived in the country. A banner crop, cut and stacked, carted out of the rows, counted and loaded onto straw-filled boxcars. The door is shut with a clang. A crewman gives a thumbs-up, the engineer nods, the train moves into open country with a shriek, slow at first, then gaining speed, the wheels seen close up, spinning into a void. The train snakes out of the hills, breaking through the jungle, appearing on the outskirts of the old colonial towns, rattling past alleys and back doors where chicken bones are piled and stray dogs roam. There were a half dozen cars on the early trains, jammed with bananas, thousands of hands reeking in the heat. A team of men worked each run, the conductor in the engine room, the foreman in the caboose, guards on the roof with rifles on the lookout for hijackers. This was wild country, the banana frontier. If Zemurray was not on the plantation or riding the train, he was looking out the window of his office as the railroad sped through Omoa on its way to the harbor.

  The first shipment was followed by a second, a third, a fifth, a fifteenth. It’s one of the great things about bananas—unlike corn or cotton or tobacco, they have no season, or one season that lasts forever, an endless summer broken now and then by hurricane or drought. The winter, the frost, the early darkness and first flurries—that’s another world, banished. Planted correctly, a banana plantation is a never-ending bounty.

  Zemurray began scouting for still more property, which would mean more rails, workers, and houses, which would require more money. But he was already overextended. He had taken loans from banks across America. When he realized no creditor would lend him another dime, he went in search of other sources. If you were Zemurray, an entrepreneur at the key moment, when you knew, just knew, you had to risk everything, that this was your shot, but the banks had turned you down and your money was on the table and you had neither wealthy uncles nor elite contacts, where would you go? The history books and articles say he secured the needed funds from unorthodox sources, borrowed on stringent terms, at rates approaching 50 percent. Which of course means gangsters, wiseguys in flashy suits on the corner of St. Claude and Dumaine.

  Ashbell Hubbard had agreed to the first round of bank loans and land purchases, and had agreed to the second, if less enthusiastically. But this was too much. Whereas Zemurray thought everything should be risked now, while the opportunity presented itself, Hubbard believed the business should be given time to become established. First plant the land we’ve acquired, pay off some loans, then we can think about acquiring more acres. But Zemurray must have realized the business had to get big to survive. Go all in, or get out. Sam was young and wanted to bet everything: great fortunes come from big plays. Hubbard did not have the fortitude for such risks. He had become a nervous partner who considered the actions of the Russian with alarm. Asked to describe Zemurray by a New Orleans newspaper reporter, the best Hubbard could say was, He’s a man with big ideas.

  When Hubbard couldn’t take it anymore, Zemurray agreed to buy out his share of the company—a 45 percent stake in Cuyamel Fruit. This left Zemurray with 90 percent of the company and United Fruit with the remaining 10 percent. The terms of the deal were never reported, but the company was valued at $400,000, meaning Zemurray paid something like $160,000, money that he surely borrowed from the same nefarious characters who lent him all the other money.

  What was Sam thinking, piling debt on debt, risk on risk? By buying out Hubbard, he was taking it all on his own shoulders. But what did it matter? If he failed by himself, he would lose the exact same amount as if he failed with a partner: everything.

  10

  Revolutin’!

  A businessman can live with a certain amount of corruption. Maybe he prefers it. If he’s paying off an official, kicking a percentage back to a bureaucrat who landed him a concession, at least he knows where he stands. In New York, they call it honest graft. In Chicago, they call it the Machine. A deal is a deal. Paid for is owned. But if a bribed official refuses to deliver, or if a bought politician suddenly becomes unbought, how can a man do business? This is the other kind of corruption, the corrupt kind, and it leads to bankruptcy and ruin. It’s not a question of right versus wrong, it’s a question of ethics. If you buy a man, you have a right to expect him to stay bought.

  And yet before he had even established himself as a grower, Zemurray began to hear whispers: all the deals he had made in Honduras, or was hoping to make (the Dávila government was not the most pliable), were in jeopardy. Honduras owed millions to bankers in London, far more than it could ever repay. The debt had been outstanding since the 1860s, when the government took out four loans, issued as bonds, with British banks to finance a national railroad. The story of the Honduran railroad epitomizes life on the isthmus. In 1870, the government hired an engineer named John C. Trautwine to lay track from Puerto Cortés on the Atlantic to the Bay of Fonseca on the Pacific, passing through Tegucigalpa, but made the mistake of paying him by the mile. When the project went bust in 1880, Honduras was left with sixty miles of track that wandered aimlessly here and there through the lowlands. (Tegucigalpa remains the only national capital without train service.) In 1900, the amount owed the bondholders, principal plus forty years of compounded interest, had reached $100 million. The bankers demanded settlement, ominously suggesting the issue might be resolved by the British navy. In 1894, British marines had in fact landed in Puerto Corinto, on the Pacific coast of Nicaragua, to collect a debt of just £74,000.

  President William Howard Taft was concerned. Anything that resulted in European military action in the Western Hemisphere challenged the Monroe Doctrine. Philander Knox, the secretary of state, devised a plan. He recruited J. Pierpont Morgan, the most powerful banker in America, to buy all of the outstanding Honduran railroad bonds, satisfying the British banks. Morgan would then refinance the debt, issuing $5 million in new loans to the government o
f President Miguel Dávila. Morgan agreed under the following condition: in return for money and services, officials from the Morgan bank would be seated in the customshouse in Puerto Cortés, where they would collect a duty on all imports. After taking the bank’s percentage, the officers would forward the balance to the Honduran government. Morgan insisted that these terms be written in a treaty and ratified by the congress in Tegucigalpa. This infuriated many Hondurans, who considered the terms a forfeit of national sovereignty.

  The Knox plan satisfied the British bankers, who agreed to sell their railroad bonds, which had a face value of $500, for $75 apiece. It satisfied President Dávila, who believed it would protect him. If Morgan bank officers were working in Honduras, the American navy would be obliged to defend them, protecting the Honduran government from revolutionaries. The Knox plan was good for everyone, in fact, except the people of Honduras and Samuel Zemurray, whose business could not function without the concessions and sweetheart deals that would be forbidden by Morgan. The Knox plan, in fact, depended on men like Zemurray paying in every way possible. If enacted, it would add as much as a penny per bunch to cost, driving Cuyamel out of business.

  Zemurray went to work as soon as he learned the terms of the Knox plan. His goal was simple: undermine, overturn, undo. Kill it dead. In the beginning, he went after this the traditional way, hiring lobbyists who buttonholed congressmen, urging them to pressure the White House. This business of meddling in the affairs of foreign nations had to stop. As the campaign gained momentum—newspaper articles, editorials—Knox became alarmed and inquired after the source of the opposition. Where’s this coming from? Who’s behind it? He soon discovered that the lobbyists were paying for neither their own meals nor hotel rooms. All bills had been charged to a Mr. S. Zemurray of New Orleans, Louisiana.

  * * *

  In the summer of 1910, on what must have been one of the strangest days of his life, Zemurray received a message from Washington, D.C. He was to report to the office of the United States secretary of state. He had been in America less than a generation, and here he was embroiled at the highest levels of national affairs. A Jew from the shtetl off for an audience with the czar. He arrived in the capital early in the morning, left the train station in the dark, rode through the streets at first light. He stopped at the hotel, then went to the Old Executive Office Building, a beautiful chaos of columns, dormered windows, and chimneys. He met first with Alvey Adee, special assistant to the secretary. Adee, a patrician with a gray goatee and steel blue eyes, was an old government hand, having served as the acting secretary of state during the Spanish-American War. He questioned Zemurray, then brought him into Secretary Knox’s office, which was wood and brass, globes, books, oil paintings. In photos, Knox looks big, soft, and round, with the commanding nose characteristic of his old Philadelphia family; his eyes were sleepy and sad. His girlish chin staged rearguard action against the bulk of his neck. Zemurray was taller than Knox, long and lean, with a shrewd face that changed when he smiled.

  The details of this meeting were reported by Zemurray to friends and a few journalists, who wrote them up and retold them. Over time, it grew into a legend. In my mind, Zemurray sits patiently as Knox explains the history of the isthmus as you might explain it to a child, the instability of the Latin nations and the Latin character, the fiasco of the Honduran railroad and the resulting debt, the danger of foreign encroachment, the issue of prestige. He speaks of Mr. Morgan’s role, the good it will do Honduras.

  Yes, yes, fine, says Zemurray, but what about the interests of a businessman who invested with certain expectations? Are previous commitments to be simply discarded?

  Knox is vague. Zemurray presses for answers. The resulting exchange, which I’ve pieced together from various sources, went something like this:

  —You’ve not been brought here to haggle, sir.

  —Then why have I been brought here? To be told I’m finished?

  —That’s not my concern.

  —Look, Mr. Secretary, if a few simple accommodations could be worked out …

  —I’m not discussing it, Mr. Zemurray. I’m not bargaining. I’m telling you the policy of the United States. Now that you know that policy, I am advising you, as nicely as I can, to go home and stay out of it. Don’t meddle in Honduras. It’s not your concern.

  —But it is my concern, Mr. Secretary. The treaty will mean the end of my business.

  —That’s unfortunate, Mr. Zemurray, but my purview is larger than your banana business.

  —But what would be the harm if concessions were honored?

  —If you have a particular concern, I suggest you bring it up with Mr. Morgan.

  —“Mr. Secretary, I’m no favorite grandson of Mr. Morgan’s. Mr. Morgan never heard of me.”

  —That’s not my concern, sir.

  “I was doing a small business buying fruit from independent planters, but I wanted to expand,” Zemurray told The American Magazine. “I wanted to build railroads and raise my own fruit. The duty on railroad equipment was prohibitive—a cent a pound—and so I had to have concessions that would enable me to import that stuff duty free. If the banks were running Honduras and collecting their loans from customs duties, how far would I have gotten?”

  When Zemurray stood to leave, Knox warned him a second time: Don’t meddle! Keep your head down! Stay out of it! I better not hear you’ve got yourself mixed up in the politics of Honduras!

  Zemurray nodded and seemed to agree, but Secretary Knox was not so sure.

  Though he tried to put people at ease, Zemurray often struck those in power as a man who could not be controlled. If you want to know what he’s going to do, forget what he seems to agree to and figure out what’s in his interest. (Sure, sure, you won’t hear I’ve gotten mixed up in Honduras.) As soon as Zemurray was gone, Knox made some calls, gave some orders. He told officials from the Department of the Treasury to put together a Secret Service team in New Orleans. He wanted the Banana Man monitored. He was not to leave the country, nor were any of his cohorts.

  Pretend you’re Samuel Zemurray. You’re thirty-two. You’ve been in America less than twenty years. You lived in Russia before that, in a poor farming town filled with rabbis. Now you’re here, an entrepreneur of considerable means, but still, somewhere in your mind, the little Jew who snuck in the back door. You’re a husband and father, with a young daughter and another child on the way. You’ve been summoned to Washington, called to account by the secretary of state, warned. What do you do? Put your head down, shut up? Sit in a corner and thank God for your good fortune? Well, maybe that’s what you would do, but not Sam Zemurray. He muttered all the way back to New Orleans: these momzers! Don’t get involved? How about I overthrow the fucking government? Is that too involved? You made a deal with the president of Honduras, Miguel Dávila? Well, what if Señor Dávila wasn’t president no more?

  Consider the audacity!

  In defying Philander Knox and J. Pierpont Morgan, Sam Zemurray was challenging two of the most powerful men in America.

  * * *

  Zemurray’s scheme can be described as a coup disguised as a revolution. (It would not be hard to stir popular anger in the country, since most Hondurans hated the Knox plan.) Dávila would be driven out and a new president put in his place. General Manuel Bonilla, who had been president of Honduras until he was deposed in 1907, was cast in the role of insurgent leader for several reasons: because he was living in New Orleans; because he was known in Honduras; because he was trusted by Honduran businessmen; because Sam knew and liked Bonilla, whom he called Mi General; because Bonilla knew and liked Sam, having described him on one occasion as “an angel sent from heaven”; because he had allies in the region who would fight by his side; because he was dark skinned and broad nosed, features described by diplomats as Indian in a way that would give the operation the aura of popular revolt.

  Zemurray worked out the arrangements with Bonilla and Lee Christmas, who was the president’s right hand. In soc
ial situations it was Christmas who did the talking. He was better with English and also something of a public personality. Zemurray would have found the men in the Carousel Bar in the Hotel Monteleone in the French Quarter, a haunt of exiled Latin American leaders and North American filibusters, mercenaries forever in search of a job, a government to overthrow.

  Bonilla was picturesque, a tiny man who now and then turned up in the uniform of a cavalry officer: riding boots and whip. Surrounded by followers, he made big promises to return to Tegucigalpa in triumph but was in fact down to his last dollar when Zemurray contacted him, living rent check to rent check in a cold-water flat on Royal Street. (William Merry, of the U.S. State Department, described Bonilla as a “half Indian and half Negro, uneducated and without much ability.”) At the moment, his interests were perfectly aligned with those of Zemurray. Sam had money, ships, guns. Bonilla had legitimacy, motivation, and that fine Indian face.

  In the summer of 1910, Lee Christmas began recruiting Bonilla’s army of liberation, tapping men in the bordellos and dives of the French Quarter, importing others from the port cities on the Gulf. He did this as discreetly as possible but was being watched—through a window, across the street—by Treasury agents reporting to Knox. It seemed as though everyone in town knew what Christmas was up to. According to an article in The New York Times (it described New Orleans as “the hotbed of revolution and the Mecca of filibusters”), “Never before perhaps have there been so many people of known revolutionary designs in New Orleans as there are now, and they are leading a score of secret service agents of this and other countries on a merry chase.”