Peeling off Honduran bananas: the banana republic
Honduras could have been a Central American success. It had the ideal location for trade. It had enough capital and resources: its bananas, fifty years ago, were valued as "green gold". Compared to its neighbors, its political system had known a certain degree of democracy and tranquility, which should have fostered economic and social development. Instead, it became one of the world's poorest nations, in desperate need for international aid. It sits at the bottom of the Central American list in terms of literacy, health care, nutrition, per capita income, life expectancy, and unemployment.
Blame must be shared by those who have governed Honduras, and by other nations and business enterprises that have taken an interest in Honduras. Together they have created the pattern of dependency characterized by the term "banana republic". Outside aid and investment have not only failed to produce widespread wealth, but have also discouraged domestic responsibility. As a result, Honduras has lost both its own self-respect and the respect of the international community.
We know very little about Honduran society and politics. We know as little about Honduran civilian and military leaders as we do about the population as a whole, and all Honduras tend to get lumped together in a way that would never happen, for instance, with the people and elites of El Salvador or Guatemala. Often, Honduras ends up being used as a point of comparison with other Central American nations. Its riches are considered not as rich as Guatemala's, its repression not as fierce as El Salvador's, its middle class not as influential as Costa Rica's. It seems that Honduras Is often seen merely as a slower version of its neighboring states, and we have only to wait and see if it turns into another Nicaragua or El Salvador.
Honduras is merely featured as a typical banana republic, a term that has come to mean more than simply a country that exports bananas and is therefore economically independent on foreign money and markets. It also implies complete political dependency, and, moreover, a country that is politically unstable, corrupt and backward. No wonder, then, that many Westerners tend to lose sight of Honduran identity amid the confusion of Central American states.
Honduras is, however, a different country, with a unique history and development. No other Central American state has had the same dedication to agrarian reform, the same high level of peasant and union activity. No other Central American state has experienced such stability of traditional liberal and conservative parties. At the same time, no other nation has suffered from such corruption and dependency.
In fact, Honduras has its own identity and its own history. In the ninth century, Honduras was the centre of the Mayan civilization's scientific achievements. In 1502, the Honduran shore was the first point on the American continent touched by Christopher Columbus's sailors. Honduras has a history of coups and sieges, betrayals and last stands, fortunes made and fortunes lost. Through its 432-year history, what it gained in the global world is its name that is always tagged on, 'banana republic'.
"Banana republic" does not just mean a country actively engaged in banana industry. It has actually become a derogatory term for countries whose government is under the economic control of a colonial or corporate power, and foreign-owned companies or industries rather than under values of democracy and social welfare. Specifically, 'banana republic' was coined to refer to Central and South American dictatorships set up for the purpose of foreign exploitation of natural resources such as agricultural crops. The term originated in the late 1800s when American fruit companies controlled the economic, political, and social development of many ostensibly sovereign Central American nations. Since then the phrase has come to signify any country that is economically dependent on foreign-owned companies.
The nation of Honduras is most closely identified with the term 'banana republic'. In the late 1870s, a liberal reform government came to power in Honduras and, in an attempt to alleviate some of the country's economic problems, aggressively sought foreign investment. The government saw mineral exploitation as a possible source of foreign revenue but after some success at silver mining the effort failed when the price of silver on the world market collapsed.
The beginning of the Honduras' epic of 'banana republic' could be perhaps traced from A corporate honcho named Minor Keith who founded the Tropical Trading and Transport Company, confident with his anticipation of the popularity of bananas. Since he was already a large stockholder in the Boston Tropical Fruit Trading Company, he eventually merged the two into a new concern called the United Fruit Company. Keith's regional political influence was made even stronger when he married into an influential Costa Rican family. He soon ran miles of railroad tracks, flanked by banana plantations, with exploited labor. Keith eventually took control of the monopolistic United Fruit Company.
Keith and his United Fruit Company which were vigilantly awaiting the opportunities to expand its business were welcomed by the Honduran government. After its failure in its grand plan in mining, the government began to see banana cultivation as a means of luring foreign investment and American companies as an attractive partner in this venture because of their ready capital, supply of merchant vessels, marketing know-how, and access to home markets; the government tempted American investment with exaggerated promises of easy profits.
The government kept hopes that local banana-growers would benefit by competition between the U.S. trading companies. In an effort to support local banana growers and develop the competition in the banana industry, the Honduran government, in 1893, put restrictions on the trading companies to buy bananas on shore, do their own ferrying to the merchant vessels, and assume damage costs themselves rather than make the local growers take the risks for them. By the same decree they also put a tax of two cents on each stem of bananas exported; the money was supposed to help pay for primary education and road and port facility improvements. Economists have estimated that if the tax had continued, the Honduran treasury would have benefited by nearly $121 million between 1912 and 1955, and the country's income would have increased by 50 per cent. But this prosperous plan was wasted because by 1912, Keith's United Fruit Company was largely in control of Honduran politics and managed to have the tax repealed by Manuel Bonilla, the first president placed in power by banana interests.
Along with this, the Honduran government implemented policies in 1897 to prevent foreign companies from owning huge estates and allowed them to buy land only in alternate lots. But the companies had skilled lawyers and hired guns to back them up. The local growers were in no way organized to protect themselves against the companies that controlled the supply of necessary irrigation equipment and pesticides and the marketing of their crop, for there was no alternative internal market. Farmers who did not "co-operate" by selling their land to the big companies found their produce rejected as inferior.
Coaxing these farmers to sell their land with blandishments and patriotic advice that his action will benefit not only his wellbeing but also the nation's economy, the United Fruit company and other banana empires were able to take over the fragile, local agricultural sector, making enormous profits on small investments. It is true that these companies have helped the nation to develop in some ways by taking over swamp land, hiring thousands of workers and building roads, schools, and medical clinics. But the massive ills of capitalist exploitation that these companies brought with them are certainly far incomparable.
The crippling effect of the banana companies on economic development was apparent. On a national level, diversification by the banana companies into banking, fishing, industry and commerce created a new economic order that operated entirely outside of the traditional market system. The beginnings of Honduran commerce were absorbed or out-sold by the new subsidiaries. The executives of the banana industry became the political power brokers who dominated Honduras.
For example, by 1930, more than half the businesses in Tegucigalpa, the costal side of Honduras, were controlled by recent immigrants. English was the language of authority. Banana Empire company indirectly looked after Honduran affairs, and they were the ones who decided the outcome of Honduran political battles.
Just as Honduran politics was in the inescapable abyss of banana empires, its society, as a whole, was whirled in hostilities engendered by the competition between banana companies over extending landholdings. As the bigger companies swallowed their competititors, the rivalry became more sophisticated and more injurious to Honduran society.
One way to understand the impact of the competition between the banana companies on Honduras is to follow the story of Sam Zemurray who sailed for Honduras to buy an old railroad concession in1905 and set up his own banana company, Cuyamel in 1911. Zemurray who lived full-time in the tropics and worked constantly, had innovative use of irrigation which helped yield bigger and better bananas. But he was still an outsider in the big league where United Fruit was already on close terms with the Honduran government; United Fruit was the one who had influence over U.S. loans for the Honduran government. Thus, the government had given the United Fruit a virtual marketing monopoly of bananas. Zemurray needed somehow to gain his own lot of concessions, and his solution was a coup d'etat to depose the Honduran Liberal president Miguel Davila, who was already under the threat of a revolution for "selling the country out to foreigners".
Zemurray supported the former president Manuel Bonilla in his plan to overthrow the existing Davila administration. Providing a surplus U.S. navy ship, the Hornet, and a boatload of mercenaries, led by General Lee Christmas, Zemurray led Davila's resignation. A year later, Manuel Bonilla who proved to be an even greater ally of the banana companies became the president. Zemurray gained exemptions from taxes and permission to construct wharves and roads, as well as permission to improve interior waterways and to obtain charters for new railroad construction. Against such a political commotion, United Fruit, however, reacted with characteristic composure, avoiding obvious opposition to the new government and thereby receiving its own share of land concessions in the northern Sula Valley.
From such blatant beginnings, the machinations of the banana empires changed to suit the times. United Fruit operated a network of local associates whose influence extended into every sphere of Honduran life. A strong public relations presence advertised the "good will" and generosity of the company. There was even a United Fruit newspaper, the Diario Comerical, and when the Central America was at the heart of the anti-Communist hysteria against thte Arbenz government in Guatemala, United Fruit paid half a million doallrs a year to lobbyists and publicists in Washington not really to protect the Americas from "communism" but rather to save itself from expropriation and to protect its Guatemalan holdings.
In the late 1920s, United Fruit and other companies sold almost all the lands to local farmers to implement the system in which the company offered seeds, fertilizers, chemicals, and packaging material and paid a certain percentage of the sale price in advance. This system left the local farmers with the risk of hurricanes, flood, disease, and market fluctuations. Indeed, when Hurricane Fifi hit in 1974, the big companies were protected; the local farmers suffered. The system also kept the companies away from labor troubles such as strikes over low wages and the poor living conditions.
As the banana companies set up more plantations on the Pacific shores of Ecuador, Panama, and Costa Rica, the Honduran banana-coast economy began to decline and accelerated unemployment. In the end foreign investment left a wake of rusting machinery, unemployment lines, and far-reaching social and economic effects.
Honduras' closer relations with foreigners put the Liberal Revolution to an end and cleaned up the vestiges of Hispanic feudalism and colonialism. But it established an oligarchy of foreign domination, leaving the majority of the population to face many of the same problems they had suffered before. The foreign companies did contribute a certain kind of development. However, these benefits of this development in Honduras went mostly to foreigners, and the huge losses were left to be covered by the bulk of the local population.
These conditions ideal for exploiting workers propagated sham democracies in this 'banana republic', Honduras. A pseudo-democracy, where elections are rigged in order to guarantee victory to the pre-selected candidate, was established. Under such undemocratic democracy, the puppet leader ensured the corporate powers that he will follow their commands in making the most profit. Other sneaky methods to institute a compliant government included the staging of political coups, where the foreign power backs an insurrection, often resulting in assassination of the current leader. The military coup only succeeds with weapons and resources secured by a foreign power. Once in control, the new government might be further supported with foreign subsidies to their agricultural crops.
A simplification of what these examples demonstrate basically goes something like this: a U.S. owned corporation sets up a plantation in a third world country-destroys tens of thousands of acres of virgin jungle to grow bananas (or cotton or coffee or sugar cane or some other cash crop). Thousands of native people are displaced from their homes; their subsistence farming existence is destroyed; they are paid meager wages to be exploited on plantations, which they are now enslaved to, because they can no longer grow their own food to feed themselves. An entire national economy is created based solely on a single crop that is highly vulnerable and easily toppled by a bad harvest or fungus infection. If banana workers' labor unions become too powerful, or if a government opposes this corporate exploitation of its people, and attempts to create agricultural reform, nationalizing land to redistribute among its nation's poorest citizens so they can become autonomous from U.S.-owned business interests and grow something besides a cash crop, a U.S.-sponsored military coup is orchestrated to overthrow the regime and a puppet government who is sympathetic to U.S. corporate interests is quickly installed.
The concept of 'banana republic' has evolved with the changing political climate. For instance, more than fruit, resources such as oil and coffee spurred banana republic in the 20th century. Corruption at all levels usually arises in these unstable governments, breeding a system rife with bribes and black markets. Increasing privatization of basic social services leaves the population with reduced wages and worsening living conditions.
It seems that Honduras after such a long history of being 'banana republic' has not escaped its ill fate. Less than a year ago on 28 June 2009, Honduras fell back into its political abyss when the military organized a coup-d'tat to overthrow the existing government and to oust President Manuel Zelaya and put him into exile. Zelaya has wanted to prolong his rule; he has been seeking constitutional means that would allow him to remain in office. The coup was prompted by his attempts to schedule a non binding poll on holding a referendum about convening a constituent assembly to rewrite the constitution. When Zelaya didn't comply with court orders to cease, the Supreme Court secretly issued a warrant for his arrest, to interview him, on June 26. Two days later, Honduran soldiers entered the presidential palace and arrested Zelaya, preempting the poll. Instead of bringing him to trial, they put him on a military airplane which flew him to Costa Rica. Later that day, the Honduran Congress, in an extraordinary session, voted to remove Zelaya from office and appoint his constitutional successor, Speaker of Congress Roberto Micheletti, in his place.
International reaction has been universally negative, with widespread condemnation of the events as a coup d'tat, the first in Central America in more than two decades. No foreign government recognized Micheletti as president. The coup has provoked a wave of protest and near-unanimous condemnation by the country's neighbours, other regional powers, the United States and the United Nations. The deposed president is determined to affirm his right to office - as hedid in a speech to the United Nations general assembly on 30 June - and return to Honduras to secure it. Those responsible for the coup seem equally committed to their chosen course of action.
Amid such a tumult, Honduras is changing. The democracy that Honduras has enjoyed was imposed in 1981 from the outside by Ronald Reagan. It yielded a constitution that minimized the participation of the citizenry in the decisions of their government and a process that repressed and decapitated the social movementsled by workers, peasants, and studentswho sought to have their voices heard. Nearly three decades later, as President Manuel Zelaya made marginal steps toward reform, by raising the minimum wage from about $0.50/hour to about $1.20/hour and attempting to create a mechanism for the people's participation in their government, the previously fragmented Honduran elite united to overthrow him.
That same elite and a deeply colonized Honduran middle class thought that the United States and other conservative members of the international community would embrace this undemocratic step. That was their first miscalculation. Their second misstep was to assume that the historically acquiescent Honduran people would shut up and accept the dictates of their social and economic superiors. The complete opposite has turned out to be true.
Huge masses of Hondurans are responding with outrage and indignation, refusing to accept the lies of the coup leaders and their propagandists. With cowboy hats and varied skin tones, they have marched.
When the coup government cut the power of the poor rural communities of southern Honduras, the peasants tuned in their AM radios to broadcasts from Nicaragua and El Salvador, getting around the Honduran media's assault of soap operas, old soccer games, and sermons about the peace and democracy. Or, when agents from the police Criminal Investigation Unit (DNIC) photographed demonstrators from an unmarked car, the demonstrators stopped the car and pulled out their own digital cameras to photograph the effort to intimidate them. Photography can be used as a means of domination and a way to naturalize socially constructed inequalities, but it is also being used here to document repression, making visible what the coup government would like to hide from the world.
We are witnessing a democratic awakening of the Honduran people. This time, if democracy is restored, it will come from the bottom up and not from outside forces, from university students camped out in stairways to protect journalists, from workers with cheap digital cameras, from peasants hiking through mountains and flouting curfew to say to elites: "Hello! This is not how a democracy conducts itself."
The new liberal Honduran political culture that is being fashioned at this moment is not emerging from empty space. Its elements were there from the beginning. From 1837-1849, following independence from Spain, the indigenous Lencan of Texiguat fought in Francisco Morazn's army for a united Central American Federation of States. In 1954, as workers and artisans, women and men, refused to load bananas onto boats now owned by the Chiquita and Dole Fruit companies, a new Honduran political subject was brought into being. In the 1970s, as peasants struggled for land reform and dignity, a vision of Honduran democracy was being formulated. This vision was not of unlimited freedom for the few and a mockery of the principle of equality for the many. Instead, peasants were insisting that freedom and equality could not be brutalized by the elite and their U.S. backers. And now, in 2009, after a military coup orchestrated by the commercial elite, blessed by the leaders of Honduras's evangelical churches and the hierarchy of the Catholic Church, embraced by much of Honduras's small middle class, and only tepidly denounced by the United States and the global world, the ghosts of the indigenous of Texiguat, the banana plantation workers and the peasants of Tocoa, are coming back to haunt the present political unrest.
If the Honduran people manage to oust the coup regime and to reinstitute their democratically elected president, this will be the moment when Honduran democracy is born. But this time, the people are fighting not only for plutocracy hidden behind a fig leaf of democracy, but also for a system of government that is of, for, and by the people.
But this is not a struggle easily won. The elite and its coup government have their guns pointed at those who oppose them. Curfews are being imposed throughout the country, restricting people's ability to move freely within their own country. Nonviolent demonstrators against the undemocratic regime are being beaten up, intimidated, and in some cases killed. On July 2, journalist Gabriel Fino Noriega was first threatened for having reported on the popular resistance to the coup; then he was gunned down. On July 11, Roger Ivn Bados Gonzlez, a member of the leftist party of Democratic Unification (UD) was executed in his own house by a group of ununiformed men. One day later, another leader from the UD, Ramn Garcas, was returning from a demonstration against the coup when he was kidnapped from a bus and then killed. Each day, such political killings, physical and symbolic, continue. The rightwing has kept the masses of poor people at bay not through indiscriminate killing but through carefully targeted repression designed to decapitate social movements. Throughout the late Cold War, elite squads in the Honduran military, with direct assistance from the United States, gathered intelligence and tracked down leaders of groups clamoring for justice and systematically eliminated them. This surgical repression often fails to spark the moral outrage of the international community and allows the Honduran elite to continue ruling the country with little regard for the poor and less regard for the country's democratic institutions.
Now as the ghosts of those fallen in the long struggle for a more just Honduras come back to haunt the present moment, the Honduran elite must be worried that this time they may have overplayed their hand. This time the Honduran people are not so easily bullied. This time they are not accepting the emaciated and exclusionary form of 'democracy' that they are being offered by the Micheletti regime. This time they are demanding not only the restitution of their elected leader but a participatory democracy that responds with concrete action to their long forgotten plight.
But in the all-too-likely scenario that the coup government is able to hold out till the elections in November, the social wound inflicted on the Honduran body politic will only grow deeper. The main candidatesElvin Santos and Pepe Lobowill go forward with their campaigns, attempting to "put the coup behind them" as they seek the legitimacy of elections. Meanwhile, the current government will continue its acts of targeted repression, quelling dissent, and disarticulating the broad opposition movement that is congealing around the demand to restore democratic rule in Honduras. This unexpected opening in Honduran political culture will be nailed shut.
Yet hopefully, this time, at this defining moment, Poor, hot, and fractious, Honduras-the original banana republic draws a second look from the global community. Honduras is going through a true litmus test of the commitment of its democratic stability and the test has proven that the Honduras.