Fruit, The cia, and
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.
United Fruit Company in Central America
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
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
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)
counter-revolutionaries at a CIA training camp in Honduras