Uncommon Grounds: The History of Coffee and How It Transformed Our World

by Mark Pendergrast

  None of the coffee men rushed to hire Elvis. Even if they had, magazines such as Seventeen wouldn’t have run the ads, still considering coffee unsuitable for teens. When the Pan American Coffee Bureau finally broke through that taboo in the late 1950s, it featured an insert, “How to Make a Good Cup of Coffee,” aimed at the future housewife, which elicited only yawns. So did the preppy, clean-cut “Teen Mates” they used to promote coffee with doughnuts, or the roaster billboard saluting the “student of the month” at a local college.

  The roasters didn’t seem to understand that teenagers wanted action, energy, and adventure. National Coffee Association president John McKiernan explained the situation graphically. “Today, the Pied Piper is . . . one giant cola bottle, and his limbs are formed of soft drink and beer cans, strung loosely so that he makes a lot of noise as he walks through the marketplace with our youth flocking after him.”

  In 1959 the Pan American Coffee Bureau hired BBDO, Pepsi-Cola’s advertising firm, to counter another major problem: the diluted-coffee trend. In what the BBDO men termed a “sprightly and unconventional approach,” the ads depicted a businessman gripping a broad sword atop a rearing horse, next to a woman on a motor scooter holding a banner with the motto “More Coffee in Our Coffee or Fight.” To join this “crusade,” readers could send in a dime for a brewing leaflet and official membership certificate in the “League of Honest Coffee Lovers.”

  Predictably, the campaign failed to bring back decent coffee brewing. All it did was attract the satire of Mad magazine, which ran a parody about the “League of Frightened Coffee Growers,” an organization that offered pamphlets telling “the whole miserable story of how the Pan-American coffee growers are losing their shirts.”

  Scared into Agreement

  African growers too were suffering from overproduction and falling prices. Threatened with looming surpluses, the Africans formed the Inter-African Coffee Organization and rushed to the negotiation table. Together with fifteen Latin American countries, Angola, the Ivory Coast, and Cameroon signed on to a one-year quota system in September 1959 in which each country agreed to export 10 percent less than its best year in the past decade. 94 Without any enforcement mechanism, however, the quota system was widely violated.

  The new agreement, a stopgap measure, at least was a start. In 1960 the British African coffee colonies of Kenya, Tanganyika, and Uganda joined the agreement, which was extended for another year. “The biggest question,” wrote Brazilian João Oliveira Santos early in 1961, “is how and when the major coffee-consuming countries such as the United States will decide to participate in a long-term agreement.” He was optimistic, noting that “the ideological and political security of the Western World is directly dependent on its collective economic security.” Clearly Santos was relying on the Communist menace to scare the United States into the agreement. As if to underline the threat, in 1960 the Brazilians sent a delegation to the Soviet Union to arrange to trade coffee for Russian oil, wheat, airplanes, and drilling equipment.

  In 1959 Fidel Castro’s rebels had overthrown the Batista dictatorship in Cuba. In 1960 Castro aligned himself with the Soviets and began nationalizing American companies, throwing the United States into a panic over Communist influence in Latin America and further propelling the United States toward support for the coffee agreement.

  The U.S. fear of communism focused not only on Latin America but also Africa. In 1960 the trickle toward inevitable African decolonization turned into a flood of newly independent countries, many relying primarily on coffee just when prices were nosediving. One coffee writer worried that the African nations might “become mere pawns in the economic warfare currently being fought by the mighty nations of the East and West”—in other words, would they be ripped apart by the cold war?

  When Charles de Gaulle offered French African colonies a choice of independence or continued “interdependence,” French Sudan (renamed Mali) and Madagascar (renamed the Malagasy Republic) chose independence while remaining in the French commonwealth. Their example prompted the Ivory Coast, which had first opted to remain a colony, to choose independence in August 1960. The French continued to provide aid money and advisers to their former colonies. “Coffee is a political problem as much as an economic one,” a French importer wrote. France had a duty, he said, to keep “millions of people within this side of the Liberty Curtain.”

  Though the transition to independence proceeded smoothly in the Ivory Coast, it was disastrous in the Belgian Congo. Some seventy-five years earlier, when Africa had been artificially sliced up by the European powers, the countries’ imposed national boundaries hid smoldering tribal rivalries that frequently erupted with independence. Nowhere was this more evident than in the Congo.95 Within a week of the Congo’s June 30, 1960, independence, the native army mutinied, looting, raping, and killing at random. The province of Katanga attempted to secede, and the Belgian government sent troops. In the mounting chaos Prime Minister Patrice Lumumba, a former postal worker, appealed simultaneously to the United Nations and to the Soviet Union for help.

  By approaching the Communists, Lumumba sealed his fate. The United States ordained not only his overthrow but his death. With CIA air support, Lumumba was captured by Mobutu Sese Seko and was assassinated on January 17, 1961. The following years brought internecine warfare, attempted revolution, American intervention, and the long-term despotic rule of Mobutu, who renamed the country Zaire. “Production is declining,” a Congo coffee man reported in 1965. “One of our merchant friends reports that 25 percent of his planter-clients have been killed. Others have left their plantations. On one shamba, the entire labor force of a hundred men was slaughtered.”

  Three days after Patrice Lumumba’s assassination, John F. Kennedy became the new president of the United States. Along with Cuba and the Congo, he worried about Angola. Determined to stymie Communist influence in Africa, Kennedy encouraged the Portuguese dictatorship to crush an Angolan rebellion rather than to allow independence. When unpaid coffee workers demanded back wages, planters panicked and fired on them. In the ensuing massacre, hundreds of whites and thousands of blacks were killed in the coffee plantations. Finally, with American weapons, the Portuguese restored order and coffee cultivation.

  The British delayed granting independence to Uganda, Kenya, and Tanganyika, hoping to provide a smooth transition. Late in 1960 Alan Bowler, a British coffee exporter, wrote from Nairobi, Kenya: “To millions in this Continent, coffee means the difference between too little to eat or enough.” With tiny farms predominating, he doubted the efficacy of any scheme to reduce the surplus coffee harvest. “To any smallholder having three acres,” he wrote, “it would take a great deal of filtered economics, plus a gun, to begin to persuade him to cut production.” By this point 80 percent of African coffee was grown by Africans.

  The new coffee agreement thus was born out of economic despair and political tension. In the United States in January 1961, John McKiernan of the National Coffee Association warned that in Africa the Soviet Union could “exploit nationalism to ensnare emerging nations into Communist slavery.” He concluded that, although the NCA traditionally had opposed quota schemes as limits on free trade, he now would support the International Coffee Agreement in this “atmosphere of international hypertension.”

  In 1961 President Kennedy sponsored the Alliance for Progress, designed to improve relations with Latin America through aid programs. In his March 13 speech introducing the Alliance, Kennedy acknowledged that “no program of economic development can be effected unless something is done to stabilize commodity prices.”

  Treasury Secretary Douglas Dillon reiterated U.S. support for a coffee agreement. On July 9, 1962, the United Nations convened a UN Coffee Conference in New York City to negotiate a long-term agreement. The meetings ran virtually around the clock. “For me,” U.S. delegate Michael Blumenthal later recalled, “the most amusing moment came at 4 A.M. one morning when I was still rushing around . . . the U.N., trying to break a
deadlock. Two other members of the U.S. team were holding on to my coat-tails, begging me to maintain the dignity of my office. I think I replied that if I had any dignity, I would be home in bed.”

  The participants finally reached a tentative quota agreement. The International Coffee Agreement (ICA) would come into full force, however, only when ratified by most of the importing and exporting countries. The deadline for ratification was set for December 30, 1963. In the meantime, the five-year agreement would go into effect informally.

  The basic quota was based on world exports of 45.6 million bags. Of that amount, Brazil was allowed 18 million bags, Colombia just over 6 million, the Ivory Coast 2.3 million, and Angola just over 2 million bags. The agreement called for quarterly quota adjustments requiring approval by two-thirds of both importing and exporting countries. Furthermore, every coffee shipment was to be accompanied by a “certificate of origin,” or re-export certificate. Countries with low coffee consumption, such as Japan, China, and the Soviet Union, were exempted from the quota system. Exporters therefore could ship as much coffee as they wished behind the Iron Curtain or to Japan. The agreement gave lip service to promotional efforts to increase worldwide consumption and to limit overproduction, but the provisions were all voluntary. Any country could withdraw from the agreement with ninety days’ notice.

  Stumbling Toward Ratification

  The path toward U.S. ratification of the International Coffee Agreement did not run smoothly. In March 1963 hearings were held before the Committee on Foreign Relations to discuss the agreement. Kansas Senator Frank Carlson asked, “Is it not a fact that what you actually are doing is placing a burden on the coffee consumers of the United States to maintain a price level in a foreign country?” Another senator asked whether it were not really “an international cartel.” In May the Senate ultimately ratified the agreement knowing that it still would have to pass “implementing” legislation that would allow U.S. Customs to reject coffee without a proper certificate of origin.

  Then nature intervened in Paraná, first with an early August frost, then a devastating September fire, all in the midst of a prolonged drought. With Brazil’s prospective crop severely damaged, coffee prices once again began to climb. After tortuous debate, the House of Representatives nonetheless voted for implementing legislation on November 14, sending it back to the Senate for a final vote.

  Eight days later, just after noon on November 22, 1963, President Kennedy was assassinated in Dallas. The coffee politics were so intense that the members of the ICA, engaged in a bitter debate over quotas at London headquarters, continued their all-day arguments late into the night, even after hearing of the U.S. president’s murder. In the end, at 2:00 A.M. on November 23, they failed to increase quotas in response to rising prices.

  To keep the ICA alive, the United States deposited its instrument of ratification on December 27, four days before the deadline, still without implementing legislation. Coffee prices continued their steady climb, from 34 cents a pound up to 50 cents for Santos #4. On February 12, 1964, knowing that American politicians were likely to kill the agreement unless more coffee were released and prices moderated, the ICA Council voted overwhelmingly to increase quotas just over 3 percent, releasing another 2.3 million bags.

  When the Senate Committee on Finance met two weeks later for three days of hearings, Averell Harriman of the State Department pointed out that the purpose of the ICA was to prevent the bankruptcy of producing countries. Delaware senator John Williams asked, “But it was a one-way protection, was it not? There was nothing in there that would protect the price of coffee from going to a dollar a pound.”

  The producing countries clearly had voted for a quota increase largely to placate U.S. politicians. “And once this implementing legislation has been approved by Congress and signed by the President,” a senator observed, “they will not have the Senate to fear.”

  Even liberal Democratic Senator Paul Douglas objected to the ICA implementation, on the grounds that higher coffee prices would not “trickle down” to peasant laborers. What had happened during the price spike in 1954? “Elaborate houses and plantation houses were built by the planters,” Douglas observed, “and they sent abroad capital anonymously to be deposited in Swiss banks in numbered accounts. . . . Money was not used for the improvement of the condition of the people.” If they did pass the legislation, Douglas noted, “we will be acclaimed for following out the good neighbor policy, but this is the superficial crust of Latin American life. The real volcano is underneath.”

  Wendell Rollason, who testified for a Miami anti-Castro organization, shared Douglas’s concerns but drew a different conclusion: The campesinos of Latin America needed help. “They seek a piece of land, a steady job, a full belly, a child’s education. . . . It is going to be us or the Russians. It’s that simple.”

  Averell Harriman told Senator Douglas that, at least in Brazil, the government was attempting “social reform and social progress, improvements of the condition of the people.” In Brazil huge fazendas still predominated, with 1.6 percent of the farms holding over half of the cultivated land.96

  The Senate passed the implementing legislation on July 31, 1964, but only after Republican Senator Everett Dirksen tacked on an amendment specifying that the United States would withdraw from the ICA upon a joint resolution of Congress. Although the House already had approved the legislation, it now had to approve the amended version. By a narrow margin, in August, the House rejected it.

  After the elections, in which Lyndon Johnson won a landslide victory, the Senate passed the amended bill on February 2, 1965, and the House once more held hearings in April, then finally passed the implementing legislation, and the International Coffee Agreement went into full effect, with the United States monitoring certificates of origin.

  Boomer Bust

  The U.S. coffee industry continued to experience its own crisis. From a “peak” of 3.1 cups a day for U.S. consumers age ten or over in 1962, per-capita coffee consumption by 1964 averaged 2.9 cups a day.

  To appeal to the baby boomers, the Pan American Coffee Bureau introduced a series of campaigns such as “Mugmates,” asking adolescents to decorate coffee mugs. “I go for coffee, you go for coffee, let’s go for coffee together,” a slogan urged. But these lame attempts did not woo teens. A survey revealed that “teenagers do not like the taste of coffee at all, and in many instances find it repulsive.” Coffee was not considered refreshing or beneficial in any way. At least there was some tiny solace: teens identified coffee as an adult beverage signaling a rite of passage into the world of the businessman and housewife. “While the youngster is consuming hundreds and hundreds of bottles of pop, he is doing so with the full cognizance that in not too many years he will be a coffee drinker.”

  Just when additional coffee promotion appeared to be absolutely vital, even the small amount of support from the Pan American Coffee Bureau fizzled in anticipation that the London-based International Coffee Organization would take over. But the ICO members failed to appropriate promotional funds for three crucial years, from 1963 until 1966. At the same time, the Coffee Brewing Institute, which for over a decade had made valiant but ineffectual attempts to improve American brewing habits, lost its funding.97

  Coca-Cola and Pepsi mounted ever-more sophisticated campaigns to entice youth. “Things go better with Coca-Cola,” sang a cheerful folk group. “Food goes better with, Fun goes better with, You go better with Coke.” Pepsi countered with a brilliant attempt to snare—and even label—an entire generation. As television commercials showed frenetically active, happy young people on motorcycles or roller coasters, a woman sang, “Come alive! Come alive! You’re in the Pepsi Generation.” In 1965 soft drink firms spent nearly $100 million on ads—twice the outlay for coffee.

  A 1965 editorial in the Tea & Coffee Trade Journal summed up the problem: “Coffee has been engaged in a tough competitive struggle for a great many years and it has been losing that fight for at least a decade. Now
, for the first time, the extent of the loss is becoming measurable and there is no reason to believe that the tide of battle is about to turn.”

  Merger Mania

  Instead of mounting a truly effective campaign to attract baby boomers, coffee roasters continued to battle one another for dwindling market share. As profit margins tightened, the process of industry concentration accelerated, with mergers and bankruptcies narrowing the field to just 240 roasters by 1965. Of those, the top eight companies accounted for 75 percent of sales.

  The most momentous merger was announced in September 1963. Consumer food conglomerate Procter & Gamble was buying Folger’s, the oldest coffee firm in the West. Up to that point Folger’s and Hills Brothers had battled for coffee supremacy primarily in the West and Midwest. By the time Procter & Gamble paid $126 million for the company, Folger’s had attained a slim lead over Hills Brothers in most of its markets. With roasting plants in San Francisco, Kansas City, New Orleans, Houston, Los Angeles, and Portland, it employed 1,300 people and held 11 percent of the U.S. coffee market.

  The buttoned-down Procter & Gamble men, who had turned soap sales into a science, shook up the genteel coffee world. Everything now had to be documented with endless reports and memos. Sophisticated television ads now reached many more consumers, playing on their fears and desires. Mrs. Olson, an omniscient Swedish busybody, magically appeared at the back door with a can of Folgers Coffee (Procter & Gamble dropped the apostrophe), just in time to save a marriage and restore true love. The ads reinforced sexist images of petulant husbands incapable of making their own coffee and frantic wives whose worth was measured out in coffee spoons. Within Procter & Gamble it was known as the “There, There” campaign. The company conducted research to determine “how ugly and aggressive we could get,” as one adman put it. They discovered that housewives would accept “all sorts of abuse” as reasonable, since they actually experienced it much of the time in their daily lives.