page_title: 1954 Guatemalan coup d'état
section_title: United Fruit Company lobbying
hierarchical_section_title: 1954 Guatemalan coup d'état / Genesis and prelude / United Fruit Company lobbying
caption_attribution_description: English: Entrance to old w:United Fruit Company building, St. Charles Avenue, New Orleans. Now houses a bank.
context_page_description: The 1954 Guatemalan coup d'état, code-named Operation PBSuccess, was a covert operation carried out by the U.S. Central Intelligence Agency that deposed the democratically elected Guatemalan President Jacobo Árbenz and ended the Guatemalan Revolution of 1944–1954. It installed the military dictatorship of Carlos Castillo Armas, the first in a series of U.S.-backed authoritarian rulers in Guatemala.
  The Guatemalan Revolution began in 1944, after a popular uprising toppled the military dictatorship of Jorge Ubico. Juan José Arévalo was elected president in Guatemala's first democratic election. He introduced a minimum wage and near-universal suffrage, and turned Guatemala into a democracy. Arévalo was succeeded by Árbenz in 1951, who instituted land reforms which granted property to landless peasants. The Guatemalan Revolution was disliked by the United States federal government, which was predisposed during the Cold War to see it as communist. This perception grew after Árbenz had been elected and formally legalized the communist Guatemalan Party of Labour.
context_section_description: By 1950, the United Fruit Company's annual profits were 65 million U.S. dollars, twice as large as the revenue of the government of Guatemala. The company was the largest landowner in Guatemala, and virtually owned Puerto Barrios, Guatemala's only port to the Atlantic Ocean, allowing it to make profits from the flow of goods through the port. Due to its long association with Ubico's government, Guatemalan revolutionaries saw the UFC as an impediment to progress after 1944. This image was reinforced by the company's discriminatory policies against the native population. Due to its size, the reforms of Arévalo's government affected the UFC more than other companies. Among other things, the new labor code allowed UFC workers to strike when their demands for higher wages and job security were not met. The company saw itself as being specifically targeted by the reforms, and refused to negotiate with the numerous sets of strikers, despite frequently being in violation of the new laws. The company's troubles were compounded with the passage of Decree 900 in 1952. Of the 550,000 acres (220,000 ha) that the company owned, only 15 percent was being cultivated; the rest was idle, and thus came under the scope of the agrarian reform law.
  The UFC responded by intensively lobbying the U.S. government; several Congressmen criticized the Guatemalan government for not protecting the interests of the company. The Guatemalan government replied that the company was the main obstacle to progress in the country. American historians observed that "[to] the Guatemalans it appeared that their country was being mercilessly exploited by foreign interests which took huge profits without making any contributions to the nation's welfare". In 1953, 200,000 acres (81,000 ha) of uncultivated land was expropriated by the government, which offered the company compensation at the rate of 2.99 U.S. dollars to the acre (7.39 U.S. dollars per hectare), twice what the company had paid when it bought the property. More expropriation occurred soon after, bringing the total to over 400,000 acres (160,000 ha); the government offered compensation to the company at the rate at which the UFC had valued its own property for tax purposes. Since this was a major undervaluation, the company was unhappy with its compensation, resulting in further lobbying in Washington, particularly through U.S. Secretary of State John Foster Dulles, who had close ties to the company.
  The UFC also began a public relations campaign to discredit the Guatemalan government; it hired Edward Bernays, who mounted a concerted misinformation campaign for several years which portrayed the company as the victim of a communist Guatemalan government. The company stepped up its efforts after Dwight Eisenhower was elected U.S. president in 1952. These included commissioning a research study from a firm known to be hostile to social reform, which produced a 235-page report that was highly critical of the Guatemalan government. Historians have stated that the report was full of "exaggerations, scurrilous descriptions and bizarre historical theories" but it nonetheless had a significant impact on the members of Congress who read it. Overall, the company spent over half a million dollars to convince lawmakers and the American public that the Guatemalan government needed to be overthrown.
caption: The former headquarters of the United Fruit Company, in New Orleans. The company played a key role in instigating the 1954 coup d'état.
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