The American writer William Sydney Porter, better known as O. Henry, led a very colorful life that seems like a noir straight out of Paramount Pictures or MGM studios.
A lowly bank clerk accused of embezzling some $500 from the books of Texas First Bank, who turns into a hard-drinking fugitive, befriending a train robber and other riff-raffs in Honduras.
In today’s hyper-financialized world with more innovative pyramid ponzis than trapwires in the 90s video game minefield, and a scam not even considered trifling unless Wall Street honchos throw and lose billion dollars on the roulette wheel, all of it sounds so droll.
During his six months hiding from the arm of US law enforcement, O. Henry coined a memorable term that has since been used to depict all sorts of corrupt, failed states and extractive monocultures. These are places where biting satire is often hard to tell from grim reality.
In the 1940s, the prevailing nexus of politics and corporate interests towards monopoly maneuvers led to a regime change in Guatemala, the neighbour of Honduras. All of it was centred around this humble tropical fruit.
The ouster of Jacobo Arbenz, the President of Guatemala, to safeguard the interests of United Fruit Company, became a turning point in the life of a feckless 23 year old medical student-cum-biker in Argentina. It was one of the rarest second order effects of history.
US Senator Henry Cabot Lodge Jr, who later became the US Ambassador to the United Nations, was a major shareholder in the company. Gore Vidal’s 1950 novel “Dark Green, Bright Red” is loosely based on US intervention in Guatemala.
Over the years, the medic from Argentina morphed into the omnipresent poster-boy of the radical left, and a counter-cultural icon. Ernesto Che Guevara became the first Minister of Industry in Castro’s Cuba.
All that is passe now with the end of Cold War, and the dawn of the End of History. But the humble banana again featured recently in a US senate discussion between Representative Madeleine Dean, who brandished a banana, and Howard Lutnick, the US Secretary of Commerce, and former CEO of investment firm Cantor Fitzgerald, who promised no tariffs on ‘Made in America’ bananas.
The US annually imports over $3 Billion worth of bananas, most of it from Central American neighbours. This makes it the world’s largest importer. Trump administration’s tariffs have made them dearer by the dozen, around 10% dearer in Walmart.
Adam Smith, the prophet of modern capitalism, if there’s one, called agro-produce an essential commodity but at the same time ‘a raw produce of the land’. He certainly wasn’t on the same page as tariffs on them as Miran or Lutnick, or other honourable man.
Smith, the sagacious Scot, wrote in the late 1700s in the Invisible Hand, the foundational tract of modern trade and commerce, that tariffs or taxes, “upon the necessities of life have nearly the same effect upon the circumstances of the people as a poor soil and a bad climate”.
Banana tariffs may be all good in the longer run, look at the shinier side: golden dome, Mars colonies, rise of machines( or planet apes, take your pick?) No pains, no gains, right?
The duality between Banana Tariffs and cutting-edge of innovation, crypto, DeFi (decentralised finance) reminds me of a statement by one Svetlana – the name is so common in Russia, or was, apparently, and phonetically unlike the guttural anglo pronunciation, that when John Steinbeck visited the Soviet Union in 1947, he endearingly referred to his guide and translator there, named Svetlana, as Sweet Lana.
Now the Svetlana I am discussing was the most famous political dissident, or rather defector, of her era.
‘We were expected to cultivate potatoes with one hand, and from the other to reach towards space’, Svetlana Alliuleva, the daughter of Joseph Stalin, said something similar.
In an address to the US Chamber of Commerce, the Soviet dictator once said that had he been born in the States, he would have aspired to become an industrialist. Sign of times rather, or the power of place.
In late-Soviet USA, as diagnosed by the historian Niall Fergusson, many industrialists apparently prefer to go the power wielder way.
The esteemed government of Anachuria, the prototype Banana Republic, that features in short story collection ‘Cabbages and Kings’, where a 20 year old lad, anointed admiral, also plied bananas on a freighter to earn extra bucks, would have endorsed tariffs without any riders.
“The government philosophically set about supplying the deficiency by increasing the import duties and by suggesting to wealthy private citizens that contributions according to their means would be considered patriotic and in order”, writes O. Henry in ‘The Admiral’.
Ironically, the political class in most countries, from Nordic welfare societies, to South Asian developmental states, would agree to this direct correlation between high taxation and patriotism.
