Today’s selection — from Citizen Coke: The Making of Coca-Cola Capitalism by Bartow J. Elmore. As it grew to be a national and international company, Coke’s future solvency was contingent upon the perpetuation of cheap sugar production:
“Fortunately for Coke, there was lots of sugar available for purchase when Coke was first invented, as sugarcane fields covered the tropical world, but this was truly an ecological conquest replete with historical contingencies. While today many people think of sugar as a ubiquitous commodity closely linked to the economies of the Caribbean and South America, especially Cuba and Brazil, not a single sugarcane stalk would have been found in these tropical regions before the fifteenth century. First domesticated in New Guinea 12,000 years ago, Saccharum officinarum (sugarcane) was native to Southeast Asia and first came to the West via Persian traders in the eighth century AD. Though sugar quickly became a desired spice and a medicinal dietary supplement for wealthy aristocrats, European sugarcane cultivation nonetheless remained modest up to the 1400s, confined to rich soils abutting the Mediterranean Sea.
|Saccharum officinarum — sugar cane|
“But sugar proved popular, and Westerners soon looked to expand sugarcane cultivation into new regions of the world in order to satiate their cravings. As they had with black pepper, cinnamon, and other coveted spices, Old World elites turned to state institutions to help them acquire greater quantities of the ‘sweet salt’ they desired, and by the fifteenth century, aristocrats in Western Europe secured government financing for colonial sugar cultivation projects in the imperial periphery. For the next three centuries, European powers cultivated sugar throughout the tropical world, relying on the labor of enslaved men and women. As a result, the sweet foodstuff became a cheap commodity by the end of the eighteenth century, available in abundance for the West’s working class.
“Sugar offered incredible caloric density, making it the ideal dietary staple for both plantation field hands in the Caribbean colonies and factory laborers working long hours in the burgeoning industrial centers of nineteenth-century Europe. It made factories and plantations productive because it kept laborers on their feet. Along with coal, sugar would become a critical fuel feeding capitalist expansion in the nineteenth century.
“The United States government recognized the value of this dense energy source in the early 1800s and offered subsidies to help develop a domestic sugar empire. Beginning in 1803, when Thomas Jefferson executed the Louisiana Purchase, Congress imposed tariffs on imported raw sugar as a means of insulating Louisiana growers from international competition. Tariff-protected Louisiana growers expanded their operations between the War of 1812 and the 1890s, producing over 17,000 tons of sugar by 1823, with total US imports topping 30,000 tons that year. By the end of the twentieth century, the government helped expand sugar cultivation to the American West and Midwest, offering subsidies and tariff protections to sugar beet growers in the temperate climates of California, Colorado, and Nebraska.
“American farmers were not the only ones benefiting from the federal government’s sweet sugar deals; industrial refiners got a big boost as well. Refiners developed the infrastructure that turned raw sugar from sugarcane and beet farms into refined white crystals fit for the consumer market. In the early 1800s, these factories were often quite rudimentary, often using open fires to vaporize juices mashed from sugarcane, but by the end of the century, refineries featured steam-powered engines and complex centrifuges capable of distilling lily-white crystals from beets and sugarcane. Investments were substantial and included railroad construction, sugar barrel manufacturing, and processing plant operation. After the Revolutionary War, the United States was far behind its European counterparts in refining, so in the tariff of 1789, the government placed heavy duties on imported refined sugar in order to help American processors gain a foothold against foreign competitors that could otherwise outsell them by a wide margin. This was part of a larger government tariff initiative to stimulate American manufacturing across all industries.
“Throughout the nineteenth century, the federal government would continue to shield domestic refiners, increasing duties on imported refined sugar to as high as 9 cents. With government protection, over fifty refineries emerged in the United States by 1870, up from just a handful seventy years earlier, but the success of many of these operations would be short-lived. Ultimately, the real beneficiaries were not small businesses but a handful of wealthy elites that gobbled up competitors to form huge monopolies.
“No one did this better than Henry O. Havemeyer, the co-owner, along with his brother, of Brooklyn-based sugar refinery company Havemeyer and Elder, incorporated by Henry’s father in 1863. By the 1880s, Havemeyer had taken over leadership of the New York-based firm, which had become one of the biggest refinery concerns in the country. The family had amassed a fortune totaling more than $3 million by the 1880s, and Henry was determined to add to the coffers. By the time he became a partner in Havemeyer and Elder in the 1860s, he was dismayed at how competition cut into profits, and he set out to buy out struggling rival firms.”