In this startling account of innovation and expansion, Enstad uncovers a corporate network rooted in Jim Crow segregation that stretched between the United States and China and beyond. Cigarettes, Inc. teems with a global cast—from Egyptian, American, and Chinese entrepreneurs to a multiracial set of farmers, merchants, factory workers, marketers, and even baseball players, jazz musicians, and sex workers. Through their stories, Cigarettes, Inc. accounts for the cigarette’s spectacular rise in popularity and in the process offers nothing less than a sweeping reinterpretation of corporate power itself.
In this startling account of innovation and expansion, Enstad uncovers a corporate network rooted in Jim Crow segregation that stretched between the United States and China and beyond. Cigarettes, Inc. teems with a global cast—from Egyptian, American, and Chinese entrepreneurs to a multiracial set of farmers, merchants, factory workers, marketers, and even baseball players, jazz musicians, and sex workers. Through their stories, Cigarettes, Inc. accounts for the cigarette’s spectacular rise in popularity and in the process offers nothing less than a sweeping reinterpretation of corporate power itself.
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Overview
In this startling account of innovation and expansion, Enstad uncovers a corporate network rooted in Jim Crow segregation that stretched between the United States and China and beyond. Cigarettes, Inc. teems with a global cast—from Egyptian, American, and Chinese entrepreneurs to a multiracial set of farmers, merchants, factory workers, marketers, and even baseball players, jazz musicians, and sex workers. Through their stories, Cigarettes, Inc. accounts for the cigarette’s spectacular rise in popularity and in the process offers nothing less than a sweeping reinterpretation of corporate power itself.
Product Details
| ISBN-13: | 9780226533452 |
|---|---|
| Publisher: | University of Chicago Press |
| Publication date: | 12/10/2018 |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 336 |
| File size: | 4 MB |
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Read an Excerpt
CHAPTER 1
The Bright Leaf Cigarette in the Age of Empire
Lewis Ginter of Richmond, Virginia, saw a potential that no other Southern tobacco manufacturer perceived when he married bright leaf tobacco, locally produced in Virginia and North Carolina, with the foreign novelty of the cigarette. Ginter took this cigarette, named Richmond Gem, to London, where it found its first big success in the elite gentlemen's clubs of the West End. With Richmond Gems as its cash cow, the Allen Tobacco Company — soon to be renamed the Allen & Ginter Tobacco Company — sent the bright leaf cigarette around the world, placing brands like Dubec, Richmond Gem, Richmond Straight Cut, Opera Puff, and Little Beauties via commission agents in France, Belgium, Australia, India, China, and many other places. Only after Ginter had made a large and widely publicized success with the bright leaf cigarette did his neighbors to the south, W. Duke and Sons, venture into them. In 1889, Ginter, James B. Duke, and three other manufacturers merged the companies to form the American Tobacco Company (ATC). To this new venture, Ginter brought more years of experience, more financial savvy, and more extensive distribution in foreign markets than did Duke, though Ginter has since been largely forgotten. The story of entrepreneurial innovation in the US cigarette industry properly begins with Ginter rather than Duke.
Telling the story of the inauguration of the bright leaf cigarette's global career requires dethroning Duke, but the point is not simply to hoist Ginter to Duke's vacated perch. Rather, Ginter's entrepreneurship reveals a new story about innovation within the world of goods. Ginter played two discernable functions as innovator: product development, in combining bright leaf tobacco with the cigarette; and marketing, in his decision to take the cigarette abroad at first opportunity and to market it as a foreign novelty. These were indispensible preconditions to success, and Ginter's vision came from his unique biography. When the first bright leaf cigarettes arrived in the London depot, though, they were inert objects, signifying nothing — at least, not to Londoners. They awaited social circulation within a particular context or group that would give them what for commodities is the breath of life: brand identity and resonant appeal. Tracing that process takes us into public scenes where bright leaf cigarettes became famous and introduces us to additional innovators, like Miltiades Melachrinos, Nestor Gianaclis, and Zheng Bozhao, as well as cultural intermediaries, such as London clubmen and Shanghai courtesans. The bright leaf cigarette's early career faced challenges when the British invasion of Egypt, the US Chinese Exclusion Act, and the rise of sexology shaped cigarette markets in unpredictable ways. In other words, to understand the rise of bright leaf cigarettes, we have to follow them into the world.
One thing neither Ginter nor Duke could escape through the whole of their careers was the innovative powers of the Egyptian cigarette industry. The bright leaf cigarette had to do battle with the Turkish and Egyptian cigarette for decades. From the 1880s through the 1910s — approximately forty years — most people in the US saw the cigarette as originally or most authentically from the Ottoman Empire. Egyptian producers not only exported to Britain, the US, and scores of other countries, but also set up branch factories in the US and around the world. For decades, the Egyptian industry defined cigarette tastes in the US and Britain and led in global trade. Indeed, competition with Egyptian producers only increased at the dawn of the twentieth century. "Turkish" tobaccos had the reputation of being the best for cigarettes and they carried the highest cost. What would the Sultan smoke? Likely not a bright leaf cigarette, which, to put it mildly, lacked the cachet of Turkish tobacco.
US producers did not shake the cigarette loose from its foreign reputation until after World War I. They did successfully make and market 100 percent bright leaf cigarettes in the US with such brand names as Little Beauties and Pinhead but, to be competitive, they also made cigarettes with all or a portion of imported Eastern tobaccos. US producers copied Egyptian branding and marketing techniques, acquired some Egyptian companies, and sold brands like Dubec, Fatima, and Murad to compete with brands like Nestor, Egyptian Deities, and Crocodile. They also improved their access to costly Eastern tobaccos. Cheap and proximate bright leaf tobacco was a great advantage for US companies; one might reasonably surmise that they would have shifted more of their domestic offerings to all–bright leaf cigarettes if they could have done so profitably.
In China, however, the cigarette became known as a Western product. Though other countries such as the Philippines, Japan, Russia, India, and Egypt also sold cigarettes in China, the cigarette took on a reputation there variously as "British," "American," or simply "Western." There, British and American producers sold the 100 percent bright leaf cigarette almost exclusively and, unlike in the US, this cigarette became the standard of value. While US and British companies sold brands with Eastern names in the US, in China they sold brands named Pinhead, Pirate, and Ruby Queen; the latter also acquired a Chinese name, Da Ying, which means Great Britain.
These global flows of tobacco and cigarettes created an odd dynamic: the cigarette entered the US as an Eastern product but China as a Western product. People in the US saw the cigarette as Egyptian and favored "Turkish" tobaccos, while people in China saw the cigarette as British, American, or "Western" and favored bright leaf tobacco. Cigarettes first found urban markets in the US and China decades before the masses of people adopted the habit, and the legacy of these early years lived on in material ways. When cigarettes did truly boom in the late 1910s and '20s, the first blockbuster brand in the US was Camel cigarettes, made of a blend of Turkish, bright leaf, and burley tobaccos, and in China, Ruby Queen/Da Ying cigarettes, made of 100 percent bright leaf tobacco. The bidirectional flow of cigarettes, brand imagery, and tobaccos contradicts the capitalist story that globalization and modernity flowed from West to East and that Western companies set the codes for consumption and taste that the rest of the world adopted. In other words, one of the most quintessential modern commodities does not fit our stubbornly persistent models of globalization and modernity.
Key to understanding virtually all cigarettes in the nineteenth century is that their national identification was not simply an objective geographical description of their origin but was inextricable from how people — especially in the US and Europe — were learning to see the world in terms of nations, races, and essences. This was the era of rising nationalism and imperialism, when Western thinkers rushed to chart the world as a hierarchy of peoples at different stages of civilization. The global flow of goods played an important role in the popularization of these ideas. In particular, cigarettes, as a new, transnationally circulating commodity, accrued and delivered value within this framework of nations and races. It became common to believe that the essence of a people inhered in the objects they made as well as in their taste in goods; one could experience something of Egypt, then, by smoking an Egyptian cigarette. Race as an irreducible essence, not the literal location of production, was the point. For native-born New Yorkers and Londoners, for example, immigrant cigarette producers in their city produced "foreign" cigarettes as surely as did producers in France or Egypt, no matter how long they had lived in the city or their citizenship status. In this way, cigarettes were world making; that is, they helped form visions of distant lands and places, however inaccurate. Conversely, imperial fantasies and events repeatedly shaped cigarettes' branding stories and markets. For the bright leaf cigarette, this global story begins in the South in the wake of the Civil War.
Developing the Bright Leaf Cigarette
In 1872, Lewis Ginter was at a turning point in his life. After seven years in New York City, he was returning to Richmond in order to become a partner in the John F. Allen Tobacco Company, maker of chewing and pipe tobaccos and a small line of cigars. Ginter had already worked as the Allen Company's principal salesman in New York for two years; as a partner, he took complete charge of the company's sales and marketing, while Allen managed the manufacturing process. Ginter brought with him the young John Pope, who had worked with him at the Allen Company's New York City depot and now took up a position in the Richmond factory. Two years later, when well established as partner, Ginter convinced Allen to add cigarettes to their line. At fifty-one, Ginter began what would become his most significant work. Within ten years his cigarettes would reach into the far corners of the world and he would be among the wealthiest men of the South. Pope would become Ginter's partner in business and in life, taking Allen's place in the company upon that man's retirement and living with Ginter for over twenty years.
Ginter's life had uniquely prepared him to discern the potential of a cigarette made from bright leaf tobacco and to envision possible markets for it overseas. In Richmond in the 1850s, Ginter certainly heard about the new tobacco type from three counties in the Virginia and North Carolina piedmont that led to such large profits. Though the Civil War disrupted development of bright leaf markets and infrastructure, the industry grew rapidly afterwards. Bright leaf was the rare economic good news that circulated through the cash-poor Upper South. In 1869, one grower in Halifax County urged others in nearby counties with similar soil types to grow "that quality [of tobacco] which is peculiar to this portion of Virginia and North Carolina. ... This for the present, at least, furnishes the only rainbow of hope to us." Richmond was not in the bright belt but was only a few hours away by train.
Ginter started out his business life in imports, not tobacco, which gave him a different perspective than men in the bright leaf belt. Born in New York City, Ginter migrated to Richmond at age seventeen with John C. Shafer, a tailor who was just a few years his senior. At age twenty-one, after working in a hardware store and briefly owning a toyshop, Ginter opened the Variety Store on Main Street, a dry goods store specializing in imports and "Fancy Goods." Fancy goods were ornamental goods or novelties that included housewares, artistic pieces, fine fabrics, and accessories. Ginter later opened a second store that became an import wholesaler supplying stores further inland and South. In order to supply this store, Ginter took nearly annual buying trips to European cities, learning commodities, trends, and markets and enjoying European cultures. His import business specialized in Irish linens and Saxony woolens, among other products, which brought him especially often to London.
Ginter's import business built upon Richmond's unique connections to both the surrounding tobacco-growing region and to Atlantic trade. Though Richmond was a small city in the 1840s, steamships carried tobacco from the port city to Eastern seaboard and European markets. Tobacco had been the foundation of Virginia since its inception as a colony, and Virginia tobacco had enjoyed an international reputation for its high quality and mild flavor for over a century. As tobacco went out, other commodities flowed in. Ginter's import wholesale business tapped that flow, tying European and Atlantic markets to Richmond shops as well as to shops in smaller towns that served the rural countryside. Furthermore, some of these towns supplied Richmond warehouses with the new, lucrative commodity of bright leaf tobacco. Ginter's business perspective developed from Richmond's unique status as both a tobacco town and an Atlantic port that connected the city and environs to the North and to Europe.
The massive destruction of the Civil War eventually pushed Ginter to New York City and, eventually, to the tobacco trade. War disrupted shipping through Richmond, cutting the city off from northern and overseas markets. Ginter shuttered his shop and joined the Confederate Army as a commissary. After the war, Richmond's infrastructure was badly damaged and cash was in short supply. Ginter relocated to New York City and opened a short-lived bank. When the bank folded, Ginter lost what remained of his prewar savings. He traveled back to Richmond and convinced his longtime friend John F. Allen that they should open a tobacco factory. Since Ginter had no capital to contribute, the company was owned by Allen and bore his name. Ginter returned to New York City as the company's salesman.
By a twist of fate, then, Ginter was in New York City selling chewing and pipe tobaccos during the years when cigarettes were just appearing on the market. After the close of the Civil War, French, Russian, and Greek cigarettes, made with Eastern "Turkish" tobaccos, predominated in the tiny cigarette import market. If the cigarette market was tiny and dominated by imports, US production was even smaller and was dominated by immigrants. Greek manufacturers, such as the Bedrossian Brothers and Nicholas Coundouris, probably initiated local production in New York City, selling both to immigrants and native-born consumers. The Kinney Brothers Tobacco Company began making cigarettes in 1869, possibly the first native-born producers to set up shop in the city.
It might seem strange that the US was a latecomer to cigarette production, given its later prominence in the global market, but the Civil War disrupted US trade at just the moment that cigarettes circulated in significant numbers. The development of paper-wrapped cigarettes required the industrialization of paper, a feat only accomplished in the 1830s. The French industry took an early lead in cigarette production because the French government had established a tobacco monopoly that socialized the risk of investment in an untried product. French cigarettes circulated through Europe and the Middle East by the 1850s, and French cigarette paper remained known as the world's best for decades. The Ottoman Empire quickly outpaced France in cigarette consumption, and Greek producers, especially, entered the business, as did producers in Russia and other countries. New York City likely saw very small numbers of cigarette imports in the 1850s, a flow that surely would have increased in the early 1860s had not the Civil War disrupted transatlantic trade. After the war, cigarettes again flowed into the US market, and domestic producers entered the competition. The vast majority of cigarettes on the market, however, were clearly marked and marketed as foreign; among them, Turkish tobaccos brought the highest praise.
Though cigarettes were far from a hot item, Ginter's work in tobacco sales and his background as an importer of foreign novelties gave him a vantage point that enabled him to see the promise of cigarettes well before any other Southern producer. He was nothing like the Schumpeterian ideal of the innovator as rogue interloper who gained insight from his lack of experience with established practices. Rather, Ginter drew on the depth of his diverse experience to envision a new combination: using a pipe and chewing tobacco in the cigarette, which was strongly identified by the flavor and cultural cachet of Turkish tobacco. In fact, Ginter's innovation matches Schumpeter's less-cited theory in which he defined innovation precisely as the carrying out of new combinations, such as joining new raw material to an established commodity. Ginter's experiences as both Northerner and Southerner, as both an importer and a tobacco salesman, all informed his ability to innovate with product development.
In hindsight, a bright leaf cigarette might seem obvious, but there were a few reasons it was not intuitive to tobacco manufacturers in the bright leaf belt. First, virtually no one in North Carolina or Virginia smoked cigarettes of any kind. Samuel Schooler of Carolina County, Virginia, was aware of cigarettes but saw their consumption as marking someone as alien to the region. In 1868, he described someone to his wife by writing, "Knew he did not belong about here — and moreover he was smoking a cigarette which is unheard of in these parts." In fact, some people had never heard of cigarettes. James A. Thomas grew up farming and manufacturing smoking and chewing tobacco and later made his career promoting the cigarette as the head of BAT-China, but he knew nothing of cigarettes until 1876 when, as a teenager, he attended the Centennial Exposition in Philadelphia. "Although my means were extremely limited," he recalled, "I finally succeeded in getting sufficient money for a trip to Philadelphia. ... Here I saw my first cigarette. It was made at an exhibit by some people from Egypt." Thomas first experienced the cigarette as a foreign good on display at a world exposition, not in the course of daily life in the South.
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Table of Contents
Preface: Who Counts in the Corporation?Introduction
1 The Bright Leaf Cigarette in the Age of Empire
2 Corporate Enchantment
3 The Bright Leaf Tobacco Network
4 Making a Transnational Cigarette Factory Labor Force
5 Of Camels and Ruby Queens
6 The Intimate Dance of Jazz and Cigarettes
7 Where the Races Meet
Conclusion: Called to Account
Acknowledgments
Notes
Index