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CHAPTER 1

The Octopus

Turned out in clean clothes, which his widowed mother insisted he wear while working, the juvenile street vendor stepped forward and addressed one of Guayaquil’s most prominent businessmen: Juan F. Marcos. Twelve years old at the time, Luís Noboa was intent on selling “magic metal” polishing cloths, which he had peddled already to more than a few merchants and housewives in the port city. Making his pitch at the entrance to Marcos’s business, the Sociedad General, Noboa observed, “This building has a lot of brass, but none of it is shiny.” He seized a tarnished pot for an improvised demonstration, and in a few seconds the pot was glistening in the tropical sun.¹

Marcos and Noboa might well have been passing acquaintances. Guayaquil, though more populous than any other settlement on the Pacific coast of Ecuador, was not a large city. Also, Noboa had received acclaim the previous year, 1927, for selling more copies of a popular magazine than any other newsboy. This feat related in part to personal deliveries of the magazine to the homes of wealthy subscribers, including Marcos. But whatever his previous contact with the businessman had been, the youngster made the sale. Handing over a few coins for the polishing cloths, Marcos also had something to offer: a job at the Sociedad General.²

Noboa did not accept on the spot. After all, he figured, the starting salary at the bank did not match his earnings as a street vendor. But his mother, left nearly penniless by her husband’s death in August 1924, scolded him later for this hesitancy, emphasizing how much he could learn by working at a leading commercial establishment. Always obedient to her, the boy wasted little time returning to Marcos’s office to take the job.³

So began the career of Ecuador’s most successful businessman of all time. When Noboa died in 1994, he left his heirs more than 650 million dollars.⁴ However, an enormous fortune was not his only legacy, or indeed his most significant accomplishment. Noboa deserves much of the credit for his country’s rise to the top of the tropical fruit industry. This ascent transformed Ecuador, the smallest Spanish-speaking republic aside from Uruguay in South America and about the size of the U.S. state of Colorado. The industry as a whole changed fundamentally as well.

Banana exports from Ecuador boomed after World War II, which ended the effective monopoly the United Fruit Company had enjoyed since its creation in 1899. The firm’s unchallenged position had been secure as long as the Caribbean Basin, where United Fruit faced little competition, provided most of the bananas consumed in the United States and other importing nations. But once entrepreneurs such as Noboa tapped into Ecuador’s enormous agricultural potential, monopolization of the banana market was beyond the reach of any single company, even the most powerful agribusiness the world has ever known.

Vertical Integration

United Fruit emerged out of a brisk trade in bananas launched after the U.S. Civil War by sea captains eager to profit from their countrymen’s desire for fresh fruit year round—not just in the months when apples, peaches, and other crops are harvested north of the Tropic of Cancer. Before the days of refrigerated shipping, the only way to supply fruit before and after the harvest season was to bring in bananas from the Caribbean Basin—a line of commerce that was fraught with risk, and not only because of the speed at which the fruit ripens, then rots. Between 1885 and 1890, one of every seven sailing ships used to carry bananas to the United States ended up at the bottom of the ocean. Of the 114 banana-importing firms that operated in the United States from 1870 to 1899, 92 went out of business; of the 22 firms that remained at the end of the nineteenth century, all but four were small concerns.⁵

The largest firm of all, the Boston Fruit Company, was the product of an association between Captain Lorenzo Baker and Andrew Preston. Baker had helped introduce bananas to the United States in 1870 by purchasing 160 stems in Jamaica, catching a favorable wind to sail straight to New York harbor, then selling the odd, exotic fruit at a handsome price.⁶ A year later, while delivering bananas to Boston, he met Preston, who had little formal schooling yet had a talent for sales, marketing, and distribution. Not long afterward, Preston quit his old job so that he could work full time selling the fruit imported by Baker up and down the eastern seaboard. This partnership was formalized in 1885, when the two men joined ten private investors to establish Boston Fruit.⁷

Another of the four large firms supplying bananas to the United States during the late 1800s, the Tropical Trading and Transport Company, was headed by Minor Keith, whose career in railroads included construction of a line linking the Caribbean coast of Costa Rica with the highland capital of San José. Yellow fever and other diseases cost the lives of thousands of men whom Keith had brought down from New Orleans to work on the project. All three of his brothers died in Costa Rica as well. Yet the reward for completing the railroad was a sprawling grant of land, some of which was cleared and planted to bananas.⁸

As the nineteenth century was drawing to a close, Boston Fruit possessed an impressive fleet of steam-powered vessels, which brought in most of the U.S. banana supply.⁹ Due largely to Preston’s efforts, it also had the best network of ice-cooled railcars and warehouses for delivering fruit far into the continental interior from coastal ports. But aside from 540 hectares that Baker had bought in Jamaica, Boston Fruit’s holdings of tropical farmland were negligible.¹⁰ In contrast, the holdings of Tropical Trading and Transport were extensive, far outstripping its assets for shipping and distribution. Each firm’s shortcomings were overcome by the merger of Boston Fruit and Keith’s business that created United Fruit less than a year before the turn of the twentieth century. Vertically integrated, the combined enterprise could grow bananas in the tropics, ship fruit across the ocean without delay, and dispatch produce quickly to customers throughout the United States.

Preston reinforced United Fruit’s dominance of the U.S. market by arranging for the company to purchase shares in dozens of smaller competitors. To avoid being charged with violating the Sherman Antitrust Act of 1890, the company made sure never to control more than 49 percent of the banana business in any of the cities where it operated.¹¹ Tacit cooperation was routine between the commercial leviathan formed by Baker, Preston, and Keith and the other firms. But even as United Fruit came to be known as The Octopus for wrapping its figurative tentacles around those firms, their continuing existence helped create a legal defense that could be used in the event of antimonopoly litigation.

Among the many businesses United Fruit invested in was Elders and Fyffes, the leading supplier of bananas in Great Britain. Known as Fyffes after it became a wholly owned subsidiary of the U.S. multinational in 1910, the British enterprise previously had competed directly with The Octopus for bananas harvested by Jamaican growers.¹² United Fruit also took a stake in the Standard Fruit and Steamship Company. Established the same year as the industry leader, Standard Fruit had a foothold in the southern United States because one of its founders, an Italian immigrant named Joseph Vaccaro, had purchased or constructed a number of ice factories along the Gulf Coast.¹³ Like its larger rival, the company owned plantations in northern Honduras: a Central American setting reached by sailing south from New Orleans or Mobile and then past the Yucatan Peninsula, which is too dry for banana production. These properties had been received from the Honduran government in return for building a railroad,¹⁴ exactly like Keith’s holdings in Costa Rica.

Aside from the construction of railroads, which were needed to transport harvested fruit speedily to coastal harbors, plantation development involved the clearing of jungles and the preparation of land. Vertically integrated firms invested in oceangoing vessels with refrigerated holds (commonly called reefer ships) and climate-controlled facilities for the distribution of perishable produce. Also, United Fruit pioneered the use of two-way radios for the careful orchestration of banana harvesting, transoceanic shipping, and offloading at import terminals.¹⁵

Thanks to all these investments and technological advances, fruit supplies multiplied in the United States, which caused prices to plummet. As historian Virginia Scott Jenkins observes, few Americans in 1880 had ever seen a banana. Thirty years later, the fruit had ceased to be a luxury item and was instead a dietary staple for the poor—especially their offspring, whose first food after weaning almost always consisted of mashed bananas.¹⁶ The value of bananas coming in from Central America and the Caribbean, which was less than two million dollars in 1885 and amounted to six million dollars in 1899, doubled during the first decade of the twentieth century in spite of a dramatic price reduction.¹⁷

The dietary importance bananas acquired so quickly in the United States during this period was underscored when a duty of five cents a bunch was proposed in 1913. The tariff might have seemed a trivial matter in light of the ratification earlier that year of the constitutional amendment that established the federal income tax. Not so. The National Housewives’ League urged its two million members to protest to President Woodrow Wilson, who had been inaugurated in March and supported the banana duty. By October, the idea had been dropped.¹⁸

Sam the Banana Man

Along with United Fruit and Standard Fruit, another vertically integrated enterprise, the Cuyamel Fruit Company, raised bananas in northern Honduras for the U.S. market. The driving force behind this firm was Samuel Zemurray, who had been born on a wheat farm in present-day Moldova in 1877. Having lost his father at a young age, Zemurray traveled with an aunt to New York in 1892 and from there to Selma, Alabama, to join an uncle who had a small store.¹⁹

Entrepreneurial derring-do had to wait until the adolescent immigrant had brought his widowed mother and all his younger siblings to the United States, paying their fares out of earnings from a series of menial jobs. But with the entire family reunited in Alabama by 1895, when Zemurray turned eighteen, there was no reason not to roll the dice. He staked $150 on bananas that were about to be discarded in the port of Mobile because they had ripened during the passage across the Caribbean Sea and the Gulf of Mexico.²⁰ With no money to spare, Zemurray offered a telegraph operator a percentage of sales revenues in return for lining up buyers along the route of the train he was to take with his perishable cargo. The operator accepted the deal, so all the ready-to-eat bananas found customers—at low prices, though still at a profit.²¹ After three years of wholesaling “ripes,” Sam the Banana Man (Zemurray’s lifelong nickname) had $100,000 in the bank.²²

In 1903, Zemurray sold 574,000 bananas, up from 20,000 in 1899. That same year, he met with Preston in Mobile and signed a contract with United Fruit to take bananas that were fully mature. In 1905, Zemurray and a local partner named Ashbell Hubbard purchased a financially troubled steamship company, with partial backing from United Fruit.²³ The two businessmen also bought Cuyamel and its 2,000 hectares planted to bananas in northern Honduras from the American who had founded the firm and had received agricultural real estate as a reward for railroad construction.²⁴ Around this time, Zemurray relocated to New Orleans, still shy of his thirtieth birthday.

The acquisition of Cuyamel and its Honduran farms coincided with an upswing in the U.S. government’s interest in Central America. During the nineteenth century, official Washington had paid little attention to the region—even after its economic isolation had been alleviated by the completion of a railroad across the Panamanian Isthmus in 1854, which made it profitable to ship coffee produced in the Central American highlands to Europe and the eastern United States from Punta Arenas, Costa Rica, and other harbors along the Pacific coast. But circumstances were different after 1903, when the United States facilitated Panama’s separation from Colombia and started excavating an interoceanic canal across the narrow country. U.S. leaders were concerned that past borrowing by Central American governments in Europe had rendered them susceptible to influence from outside the Western Hemisphere. To keep this influence in check, the United States engaged in Dollar Diplomacy, with U.S. financiers purchasing unpaid debts from their European counterparts and the U.S. government guaranteeing loan payments by taking over the collection of export and import duties in the indebted countries.

Dollar Diplomacy was put into practice in Nicaragua in 1911, which marked the beginning of more than two decades of colonial-style administration of the country by the United States.²⁵ The policy’s application around the same time in Honduras derived from bonds that national authorities had sold to London investors during the 1860s to finance a railroad. Due mainly to fraud, the railroad was never completed, which severely impeded coffee development and overall economic progress. However, these difficulties did not prevent the British government from insisting that all debts be settled. Stepping in to resolve the dispute, U.S. officials arranged for J. P. Morgan to buy the old bonds for 15 percent of their face value. The Wall Street tycoon then issued five million dollars in new securities to the Honduran government, which agreed to meet its financial obligations by instituting a tax on exported bananas to be collected by U.S. customs officials stationed in the country’s ports.²⁶

By adding a penny to the cost of every bunch of Honduran bananas, this arrangement put Cuyamel, which lacked agricultural holdings elsewhere, at a competitive disadvantage vis-à-vis United Fruit, which had a large operation in Honduras but also grew or purchased fruit in other countries where exports were not taxed. Zemurray protested, including in person to the U.S. secretary of state, though to no avail. Unwilling to knuckle under, he then recruited and financed a small band of mercenaries to topple the government in Tegucigalpa, with which he had a number of quarrels.²⁷ The government fell and its successor rescinded the export tax and other elements of the arrangement with Morgan and the U.S. government—an arrangement few Hondurans supported.²⁸ Cuyamel and Zemurray subsequently prospered.

Big Mike’s Vulnerabilities and a Corporate Coup

In a political and economic history of Central America, Victor Bulmer-Thomas wonders how U.S. fruit companies “could have resisted the temptation to meddle in (the region’s) internal politics” during the early 1900s.²⁹ At the time, however, their actions in places such as Honduras aroused little public comment in the United States, where banana sales continued to grow rapidly. Instead, U.S. observers were impressed mainly by the companies’ ability to supply perishable goods reliably to customers across great distances. The difficulties of this task are illustrated in John Steinbeck’s East of Eden, which is set in California’s Salinas Valley during World War I, when a failed attempt to transport lettuce in ice-cooled boxcars to New York City almost ruins the story’s protagonists. Well aware that shipping bananas from the Caribbean Basin to the United States was even harder than enterprises of the sort depicted in Steinbeck’s novel, authors during the first part of the twentieth century were unstinting in their praise of all that firms like United Fruit were doing to the benefit of U.S. consumers.³⁰

What was not understood a hundred years ago was that the environmental underpinnings of the banana business were fragile. Practically all the fruit imported by the United States was of the same cultivar: Gros Michel, which translates from French as Big Mike. Moreover, the standard practice in the industry, today as in the past, has been to propagate bananas asexually, which means there is no genetic variation from plant to plant.³¹ Agricultural estates encompassing hundreds or even thousands of hectares planted to a genetically identical crop represent monoculture on a scale that would have awed a pharaoh. Factor in tropical heat and humidity, and banana plantations comprise an ideal arena for microbial mayhem.

The opening salvo in the microbes’ assault on the tropical fruit business occurred in the 1890s, when the leaves on large numbers of banana plants in Panama started wilting and then dying and falling to the ground. The culprit turned out to be a single strain of a soil-borne fungus, Fusarium oxysporum Schlect. f. sp. cubense (FOC), against which the Gros Michel had no resistance at all.³² Tens of thousands of hectares planted to that variety were lost during the next six to seven decades. Not until the late 1950s was Standard Fruit able to solve the problem by planting a disease-resistant banana variety called Cavendish, which the company’s scientists had spent many years developing.³³

For much of the twentieth century, however, the primary response of United Fruit and its competitors to Fusarium Wilt—or Panama Disease, as the malady was known for many years after it was first detected and as many in the banana industry still call it—was not to undertake the sort of research and development that leads to better varieties. Instead, they moved their operations to places not yet infected by the FOC fungus. Some tropical countries, most notably Ecuador, gained from this relocation. But when thousands of hectares were locked up as reserves, which could be cleared and brought into production if and when existing plantations had to be abandoned because of Panama Disease, the results could be disadvantageous for host nations. Thomas McCann, who spent his career at United Fruit, admitted that real estate acquisition by his former employer went well beyond what was required for “shifting plantation agriculture”—to use a term coined by John Soluri, a historian of the banana industry.³⁴ In 1952, the industry leader

owned or controlled three million acres of land. Only 139,000 of those acres were actually planted in bananas; the rest were euphemistically carried on the books as “reserves,” although one of the most important reasons they were held was to guarantee that they would not become farmland for our competitors.³⁵

Due to strategic behavior of this sort, competition was stifled in a key sector of the Central American economy as well as the banana industry as a whole.

Territorial acquisition could even provoke international conflicts. A case in point was a dispute that arose in 1915 over a productive region on the border between Guatemala, where United Fruit had secured extensive territorial concessions in 1906, and Honduras, which was always the leading source of bananas for Zemurray’s firm. Each of the two governments rattled sabers occasionally at the urging of private interests, and U.S. mediation was needed twice during the next thirteen years to avert declarations of war.

Final resolution of the dispute had to wait until 1929, when the Boston Brahmins who had assumed control of United Fruit after the departure of Baker, Keith, and Preston decided to deal once and for all with the company’s pesky rival. A merger was proposed, which Zemurray accepted on being offered 300,000 shares of United Fruit stock.³⁶ The buy-out made him the firm’s leading investor, which distressed him enormously as the value of his holdings shrank. Worth $31,500,000 (or $105 per share) when the merger was effected, in early 1930, Zemurray’s stake in United Fruit had lost more than 90 percent of its value by December 1932, when shares in the company were being bought and sold for $10.25. The stock collapse was in large measure the result of poor corporate administration, not simply a consequence of the Great Depression.

In January 1933, Sam the Banana Man traveled to Boston for one of the most storied confrontations in the annals of U.S. business. According to Mc-Cann, “Zemurray presented an incisive review of the company’s mismanagement.” The patrician chairman of the board responded by smiling thinly and drawing attention to his stockholder’s accent: “Unfortunately, Mr. Zemurray, I can’t understand a word you say.” The former immigrant stepped out of the room, but only to return a few moments later clutching the majority share of proxies he had collected beforehand. “You gentlemen have been f---ing up this business long enough,” Zemurray informed the board slowly and precisely. “I’m going to straighten it out.”³⁷

The investing public was more than pleased; the price of United Fruit stock shot up, doubling during the fortnight after the corporate coup.³⁸ Confidence in Zemurray’s leadership turned out to be entirely justified. For example, he had learned from conversations with the company’s ship captains prior to the January 1933 takeover that all vessels had been ordered to cruise at half speed. While this measure reduced expenditures on fuel, it also caused much more fruit to spoil while in transit, so the policy was reversed and all ships were authorized to travel at full speed soon after United Fruit’s old president and former chairman of the board were sacked.³⁹ Changes of this sort not only had a positive impact on United Fruit’s bottom line, but probably saved the company from going under in the 1930s.

Latin Americans Take On El Pulpo

Just as United Fruit acquired agricultural land and strove to dominate its commercial rivals, every firm in the industry sought to exercise tight control over agricultural labor. Wages offered by the multinationals and benefits such as food sold in company stores at below-market prices and medical care provided free of charge in company hospitals were superior to the rural norm in countries such as Ecuador and Honduras.⁴⁰ But at the same time, unionization was opposed vigorously.

Transnational firms did not win every battle with organized labor. For example, plantation workers in Honduras struck successfully in 1920 for a daily wage of $1.75, with double pay for overtime;⁴¹ this level of compensation was well above the sixteen to fifty cents per day earned by laborers on coffee farms elsewhere in the same country.⁴² However, workers and unions also suffered crushing defeats. An unusually bloody confrontation occurred in 1928 in northeastern Colombia, where United Fruit had arrived at the turn of the twentieth century. Opposed to the labor-contracting system the company used not just in Colombia but on all its plantations, strikers demanded regular employment and recognition of their union. The authorities in Bogotá responded by deploying a military force, which on 6 December 1928 killed sixty to seventy-five protesters in the city of Ciénaga.⁴³ This woeful incident achieved lasting notoriety once Gabriel García Márquez featured the confrontation and a wildly exaggerated death count in his novel, One Hundred Years of Solitude.

Events such as the Ciénaga massacre caused opinions about the tropical fruit industry to shift. Gone were the encomia published during the early 1900s. In their place were indictments consistent with the anti-corporate attitudes that gained wide circulation in the United States during the 1930s. Representative of the new literature was a frequently-quoted denunciation of United Fruit penned by Charles D. Kepner and Jay Soothill:

[This] powerful company has throttled competitors, dominated governments, manacled railroads, ruined planters, choked cooperatives, domineered over workers, fought organized labor, and exploited consumers. Such usage of power by a corporation of a strongly industrialized nation in relatively weak foreign countries constitutes a variety of economic imperialism.⁴⁴

This denunciation, which did not even concede that cheap bananas were a boon to consumers, resonated in Latin America. Most famously, Chilean poet Pablo Neruda condemned El Pulpo (The Octopus) in his Canto General of 1950 for “reserving for itself the juiciest part” of the Western Hemisphere, staging an “opera buffa” in the banana republics it spawned, and making off with “the treasure of our sunken lands.”⁴⁵

However, exercises of power by the company or its local allies did not cement the multinational’s hegemony over the tropical lands that were the source of its produce. To the contrary, opposing forces were often galvanized. As Marcelo Bucheli notes in his history of Colombia’s banana industry, public revulsion over the killings in Ciénaga helped bring down the conservative regime that had been in power since 1904 and had provided tax waivers, cheap land, and other inducements to foreign investors. President Enrique Olaya, the center-left victor in the 1930 election, disappointed his radical supporters by not instituting a tax on banana exports and by extending United Fruit’s lease on a railroad serving its zone of operations. However, President Alfonso López, who succeeded Olaya and was from the same political party, signed Colombia’s first agrarian reform law, which among other things strengthened the property rights of peasants who had occupied the uncultivated fringes of large estates. Unions received support as well, including in the banana sector.⁴⁶

After World War II, multinationals’ prerogatives were even trimmed back in Central America, where national authorities formerly had spared no effort to propitiate foreign investors in the fruit industry. Costa Rica and Honduras modified old concession agreements, which had exempted foreign investors from taxes on their profits, in 1949. In 1943, Costa Rica instituted a labor code that established the rights of all workers, including in rural areas, to organize and strike; similar codes were adopted in Nicaragua in 1945 and in Guatemala in 1947.⁴⁷ Honduras did not follow suit immediately, although a strike in 1954 resulted in the recognition by United Fruit and Standard Fruit of a single union representing all the employees of the two multinationals.⁴⁸

During the late 1940s and early 1950s, regimes preoccupied with communist influence, especially within the labor movement, came to power in most of Central America. The leading exception was Guatemala, where Jacobo Arbenz, a former army officer with leftist sympathies, was elected president in 1951. Not content with raising duties on fruit exports and introducing taxes on industry profits, as was happening in neighboring countries, Arbenz’s government opted for “a head-on clash with [United Fruit] over land reform and financial compensation for expropriated land.”⁴⁹ To be specific, an order was issued in 1952 that uncultivated areas in holdings larger than 269 hectares be redistributed to rural households with little or no land. The previous owners of confiscated properties, including United Fruit, were to be paid off with bonds valued according to those owners’ tax declarations (which invariably amounted to a small fraction of the market value of real estate), paying annual interest of 3 percent, and maturing in twenty-five years.⁵⁰

All told, Arbenz’s agrarian reform redistributed 600,000 idle hectares to 100,000 rural families. Of those 600,000 hectares, 160,000 were taken from United Fruit, which formerly had possessed 220,000 hectares in Guatemala but kept 85 percent of its holdings in reserve. Even though the company insisted that its land was worth $185 per hectare or more, it only received bonds with a face value of approximately $7.50 per hectare in compensation.⁵¹ In response, The Octopus mounted an aggressive publicity campaign aimed at convincing U.S. leaders that Guatemala had become a hotbed of communist subversion.⁵² Whether or not the campaign was as influential as some writers claim, the U.S. government grew much more antagonistic toward Arbenz after the inauguration of President Dwight Eisenhower in 1953. The following year, the Central Intelligence Agency (CIA) engineered a coup d’état that drove the Guatemalan leader into permanent exile.⁵³

Enter the Ecuadorians

Despite close collaboration between United Fruit and the U.S. government before and during the Guatemalan coup, antitrust charges were filed against the company a few months after Arbenz’s overthrow. Four years of litigation ensued, finally culminating in a consent decree signed in 1958 that obliged United Fruit to spin off railroads in Central America and marketing operations in the United States. The decree also required the divestiture of one-third of the industry leader’s agricultural holdings.⁵⁴

United Fruit had to deal with the antitrust lawsuit and other challenges without Samuel Zemurray. Seventy-seven years old and suffering from Parkinson’s disease, the last of the banana industry’s pioneers had no choice but to step down in 1954, this time never to resume the career he had embarked on at eighteen. McCann served under Sam the Banana Man, as he fondly refers to his former boss, and makes clear that Zemurray put his stamp on United Fruit: “His company and his character were almost exactly matched: … tough, no-nonsense, quick to act.” McCann’s employment continued after Zemurray’s departure, which in his eyes diminished the company—causing it to become “forceful one minute, indecisive the next, living as much off its own past as for its future.”⁵⁵

The years following Zemurray’s retirement were no time for indecisive management given the stiff competition The Octopus was encountering, from U.S. firms and South American entrepreneurs alike. Certainly, Noboa and other Ecuadorians were not to be taken lightly. Their environmental advantages were undeniable: a tropical setting ideally suited to tropical fruit production that admittedly was farther from leading markets in Europe and the eastern United States but that also was free of hurricanes, which were (and remain) a constant menace in the Caribbean Basin. The Ecuadorians had nonenvironmental advantages as well: being located in a port city with a long tradition of international commerce, complete with the business services needed to win over customers throughout the world. As is documented in the pages that follow, the skills and capacities of exporters based in Guayaquil exactly matched the entrepreneurial requirements for success in the international banana business.

Whether or not creative destruction has occurred in Ecuador can be debated. Defined narrowly, this process, which economist Joseph Schumpeter examined during the early 1900s,⁵⁶ involves major strides in productive technology, which Ecuadorians have never undertaken. However, entrepreneurs such as Noboa were creative in that they established something that did not exist before: a tropical fruit industry in Latin America that was not controlled by major corporations headquartered in the United States. This development was also destructive: the emergence after World War II of a large and independent source of bananas south of the Panama Canal directly undermined the monopoly The Octopus had enjoyed previously thanks to the control of agricultural resources farther north, in the Caribbean Basin. Thus, the commercial rivalry coming out of Ecuador did not confine itself to the remote margins of United Fruit’s business. Rather, the country’s entrepreneurs struck at the very core of that business. If this was not creative destruction in the strictest sense of the term, El Pulpo could be excused for not appreciating the difference.