UNITED Fruit, The cia, and counter-Revolution


       The United Fruit Company first became an institution in Guatemala under the reign of Gen. Jorge Ubico.  Ubico’s favorable attitude toward outside investment prompted UFCO to become thoroughly involved in Guatemala.  Ubico gave UFCO its two huge banana estates of Tiquisate and Bannanera, each covering hundreds of square miles, as a gift.  The company treated its 40,000 employees fairly well; offering lodging, some schooling and access to medical care on the plantations.  UFCO had a controlling interest in the country’s only railroad, as well as its only port.  It also was invested in the countries utilities, including telegraph and electricity. 


The United Fruit Company in Central America

history.sandiego.edu/gen/ USPics14/16941.jpg


When Jacabo Arbenz implemented land reform under Decree 900, over 400,000 acres of UFCO land was expropriated.  All the land was uncultivated, so the expropriations had no effect on UFCO’s production.   However, UFCO had been in the habit of grossly underestimating the value of its lands to avoid taxes.  As a result, the Arbenz government granted UFCO 1.2 million as compensation for lands UFCO valued at over 16 million.  This discrepancy caused UFCO to appeal to the U.S. government for intervention and launch an all out propaganda war against the Arbenz regime.  UFCO hired Edward Bernays, a prominent public relations man with numerous ties to American politics and media, to produce this propaganda. This included paying for reporters to travel to Guatemala on “fact finding missions” and then exposing them to staged events showing the onslaught of communism in the country.  The UFCO also produced a great amount of unfounded literature detailing the supposed communist infiltration of the Arbenz regime.  This literature was then circulated to influential politicians and opinion leaders. (McCall 45-48)

          At the same time that UFCO was calling for U.S. intervention, conservative opposition to Arbenz within Guatemala was solidifying and echoing the call.  Among this opposition was Castillo Armas, a protégé of Arana, who had appealed to the CIA for help in deposing Arbenz as early as 1951.  Along with Armas and conservatives within the country, Guatemala’s neighbors were calling for U.S. intervention.  Nicaragua, El Salvador, Honduras, and the Dominican Republic all feared that Arbenz’s leftist politics would be exported to their countries, causing social unrest.  Many of the countries produced anti-Arbenz propaganda and offered support for U.S. initiated counter revolution.

          In 1952 the CIA began making plans for a coup in Guatemala.  This operation is known as PBSUCCESS.  At this time the CIA began producing anti-Arbenz and anti-communist propaganda within Guatemala.  Also at this time the United States enforced an arms embargo, preventing Arbenz from securing supplies for the military.  Up to this point the Guatemalan military was for the most part supportive of Arbenz, a former officer, but not his initiatives such as land reform.  They were, however, decidedly anti-communist and afraid of U.S. military intervention.  When Arbenz was unable to supply his army he began to lose support.  On June 18, 1954 a small force of counter-revolutionaries trained and armed by the CIA and under the command of Castillo Armas began a coup.  They were for the most part unsuccessful, making minimal headway.  Yet, it was enough to trigger a reaction by the military elite.  Facing the prospect of U.S. intervention and the pressure of the conservative and moderate opposition to Arbenz, the military forced Arbenz to resign on June 27, 1954.  With that Guatemala’s flirtation with social democracy ended and the country was returned to the iron rule of oppressive tyrants. (Karabell 120-134)


Guatemalan counter-revolutionaries at a CIA training camp in Honduras

history.acusd.edu/gen/ USPics39/arbenz.GIF