UNITED STATES—Sam Delaney the Stock Market crash heralded the time of his life. It was as if he needed a crisis to thrive and bring out the best—it was a streak he hid from Rebecca, then again she might’ve known it all too well that Sam was not the rock he portrayed himself to be, but he was doing the best he could. Sam had his work cut out for him. He picked up on each and every little thing.
Sam picked up on Allied Fruit’s main blunder. WASPs that they were, Boston blue-bloods, they begged to presume that they could tell every worker and executive and told them HOW to do it. That was poison, a good leader knows that you tell people what to do—not how—that will lead them to their own ingenuity, and often you may be very pleasantly surprised. Sam reversed the policy of running everything out of an office on the 11th floor of an office building in Boston.
Sam got wistful and patriotic about this, saying “I set forth what could be called a constitution for the company…” when interviewed about the successful turnaround of the company, he explained how the “constitution” encouraged a maximum around to home rule in many tropical countries.”
It was now a fixed and public policy that if a plantation manager could not take care of difficulties in a reasonably timely fashion, another person would be appointed. They would likely be replaced by veterans of Chamelecón, no matter how personally elegant they might be with their Ivy League airs. Whenever he found an employee slow to decide or who simply could not act decisively.
He did his duty in coming back to the company he built, starting with a push-cart. And it showed Sam a humbling lesson, that the awesome responsibility that comes with ownership. Nobody else could have done this, and Sam felt this. It is what brought him out of retirement. What he did might have come back like the bullet, a real hot bullet discharges from a real firearm. Dirty SOB that he was, Sam had to be fearless, intrepid when firing hundreds of employees, knowing he would add to the store of the nation’s woes. It had to be done, it was necessary. In fact, somebody showed up from Senator Long’s office.
“Mr. Delaney, it might not be wise to pursue this course of action. It is well known that no friendship had been lost between you and the Senator.”
Sam did what he had to do. Half-filled ships would never be a problem again. Some were sold, some were mothballed, space was rented out in others or they piggy-backed bananas and sugar. A ship was only ready leave port now when the cargo hold was filled. After pushed less innovative but essential policies, nuts and bolts stuff, like having all the lands, holdings and equipment of Allied reappraised. The value of the property and equipment sank. The bottom fell out during the Depression. This reappraisal resulted in tax savings followed by lots of zeros in taxes on U.S. soil.
Furthermore, Sam designated that more of the banana lands go fallow. This reduced the banana supply and increased banana prices. “That was sure smart of you, Mr. Delaney,” said Milton Friedman. “You never went to college and you achieved this degree of control.”
On his own, Sam discovered that the Company was too dependent on bananas. To overcome this dependence on a single produce, he sought to grow other plants on Allied lands: mangoes, coconuts, pineapples, quinine trees—quinine cinchona that yielded quinine and other alkaloids that were the only treatment against malaria at the high vogue of European colonies.
Indeed, from Boston to Bogotá Sam Delaney weeded our mediocre and redundant employees, until one in four was gone,” as reported in the Wall St. Chronicle, you know we grew up with the boring crap in my house, Business Week, the Wall Street Journal, so boring and formal, without pictures or advice columns, though it is a figure that Sam disputed in later years, saying in his ruthlessly simple way that he only replaced workers who were failures. In place of managers he did not like, he put in Veterans that went back to his Chamelecón Co. days.
Again, the tax angle, through the savvy reappraisal of properties at 40 million below their previous 1920s value, Allied Fruit made a savings of some $3.5 million a year in depreciation.
Sam in his ruthlessly direct way once said, “When you get into the big money. Even if you fail you succeed.”
To be continued…
Graydon is the Wizard of Fiction.