Soda as Politick

When they think of democracy they think of Coca-Cola

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Shortly after taking possession of the Golan Heights in June of 1967, Israeli Defense Forces entered the abandoned headquarters of the Syrian Army and in the flush of victory stripped down a Pepsi-Cola marquee — battered but still aloft — and hoisted a gleaming new Coca-Cola sign in its place. Regarded from today’s perspective, this seems like a gesture of inscrutable black humor or Warholesque non sequitur, a campy inside joke for which the reference has been lost. But to observers at the time, the merging of the cola wars and the Arab-Israeli conflict was a familiar story, and one to which the establishment of Coke’s “sovereignty” brought dramatic resolution.

Like all dramatic resolutions, this one involved a reversal of fortune. Only a little over a year before, after all, Coke was cola non grata in Zionist circles. In April of 1966, the Anti-Defamation League of B'Nai Brith wrapped up a fifteen-month investigation of Coca-Cola by concluding that the company — which then had no Israeli franchise and had in fact refused one to an Israeli bottler — was cooperating with the Arab League’s boycott of companies doing business with Israel. Coke’s management stumbled into damage control. The New York City Human Rights Commission began to look into the matter, and in the meantime, the Coke spigots went dry at Nathan’s Famous Hot Dogs on Coney Island and in the cafeteria at Mount Sinai Hospital, as a counter-boycott by American Jews took shape.

Few were convinced by Coke chairman James Farley’s claim-in a lengthy public statement printed in full by the New York Times — that Israel just wasn’t a promising and lucrative market for the beverage in question. Subsequent equivocations fell similarly flat, and within a week Coke had granted an Israeli concession to one Abraham Feinberg, a New York financier who in 1949 had applied and been rejected for the same thing.

The ADL issued a statement declaring that they were “delighted”; the Arab League issued a statement declaring an ultimatum. Coke, for its part, issued statements, in the form of large advertisements in Egyptian newspapers, declaring the importance of its product to the Egyptian economy and stressing the number of Arabs employed by the company. Public relations efforts, however, proved fruitless, and by the close of 1966, the decades-long Arab boycott of Coke had begun. The raw numbers of the new dispensation didn’t look good; the strategy Coke had hitherto pursued made more sense, as neatly summed up by one wry Israeli official: “Somebody looked at a map and saw eighty million thirsty Arabs opposed to a couple million thirsty Israelis, and that was that.” Meanwhile, Pepsi claimed that it couldn’t compete with Coke in Israel and therefore wouldn’t try, and consoled itself for the loss by catering to the aforementioned eighty million. While the flimsy rationale was enough to protect Pepsi from the sort of outrage that had plagued its rival, a can of Pepsi-Cola swiftly lost kosher status everywhere from the Catskills to, as mentioned, the newly occupied Golan Heights. We know who won the Arab-Israeli war of 1967, but who won the cola war of that same year?

You could, if you were so inclined, refract the entire history of Arab-Israeli-American relations through the prism of cola politics. The results would both radically distort and sporadically illuminate. Israel’s victory in June of 1967 was a watershed for the US-Israel alliance, ushering in a recalibrated realpolitik, in which Israel’s strategic value would weigh more heavily against the economic value of the Arab countries. Coca-Cola in the spring of 1966 was ahead of this curve, even if at first unwillingly. The Six-Day War catalyzed what might be described as a rebranding of Israel itself; American support for the state was no longer an expression of ethnic solidarity and religious yearning, nor of sympathetic well-wishing across such lines, but was becoming instead a dutiful extension of American patriotism proper. (Since the 1970s, to give just one example, American companies complying with the Arab League’s boycott find themselves the target not of Jewish counter-boycotts, but of government fines and legal prosecution.)

Since at least as far back as 1950, when chairman Farley addressed the American Trademark Association and described the American flag as “the most glorious of all trademarks,” Coke has been prescient about aligning its corporate policies with American foreign policy. Indeed, one finds Coke not merely in alignment but at times in the vanguard; according to JC Louis and Harvey Yazijian’s The Cola Wars, Coke has “greased the machinery of foreign policy” not only in the Middle East but in Cuba, Central America, and the former Soviet Union. When after the Yom Kippur War of 1973, Egypt was in dire need of foreign investment, Coke sent an Egyptian-born executive, Sam Ayoub, to Cairo to begin laying the groundwork for an eventual end-run around the boycott. Ayoub bided his time, penetrated Sadat’s inner circle, and arranged for meetings between the Egyptian president and Coke’s then-chairman, Paul Austin, and by 1977 — a year before the Camp David Accords — Coke had been granted permission to reintroduce its full line of products into Egypt.

Coke’s strategy with regards to Arab markets evolved out of the success of its “separate peace” with Egypt; the goal thenceforth was to weaken Arab solidarity-and neutralize the Palestinian issue-by pursuing individual deals with “moderate” states, one by one. By the time the first Intifada began in 1987, Coke had reopened markets in Saudi Arabia, United Arab Emirates, and Oman. Needless to say, the approach meshed seamlessly with President Carter’s Middle East policies, as well as those of subsequent administrations.

Chummy relations between American administrations and transnational corporations, as we know, are the norm, not the exception. What’s intriguing about Coke in the 70s and 80s, however, is how content it was to let rumor and speculation foment about its intimacy with the highest government offices. When the Federal Election Commission began investigating alleged improprieties of the so-called “Carter connection,” chairman Austin told the New York Times that it would be “very injudicious” either to confirm or to deny them, adding coyly that he and Carter “have a friendly, open relationship.” Austin’s equanimity makes more sense, however, when one considers the subtlety, assiduousness, and quiet ingenuity with which Coke has blurred (and let blur) the line between the branding content of its own logo and that of “the most glorious of all trademarks.”

That strategic blurring animated one of the greatest corporate rumors ever deliberately disseminated, that of Coke’s “secret formula.” Coke had since its earliest days claimed to have a secret recipe, but the Cold-War cultural context of national intelligence, counter-intelligence, nuclear secrets, and foreign sabotage extended the rumor’s imaginative lease and gave it new resonance. Major newspapers ran hundreds of articles on Coca-Cola’s “secret formula” in the 70s and 80s. Company spokesmen claimed that the formula was kept in a vault that could be opened only by a vote of the board of directors — adding that at any given time, the formula was known by only two senior chemists active in the company.

Coke ostentatiously adhered to a policy of not sharing the secret with any foreign bottlers it dealt with, instead selling them the concentrated syrup ready-made — even when it meant once losing a contract with India. But there was one remarkable exception; in 1992, Israeli and American papers, including the Wall Street Journal, reported that Coke had revealed the formula to two Israeli rabbis, Rabbi Moshe Landau of B'nei Brak and the chief rabbi of Israel, Avraham Shapira. The ostensible purpose was to guarantee kosher certification, but Coke’s archly ambiguous statements to the press — alluding to the transfer of secrets while refusing to confirm or deny it — seemed a subtle riff on Israel’s “policy of deliberate ambiguity” with regard to nuclear secrets.

If branding is the art of cultivating the growth of connotations and secondary associations, rumor is the force by which they mutate and metastasize. Neither Coke nor Pepsi has had much luck in harnessing the latter in service of the former when it comes to the Middle East. Pepsi-Cola’s online promotional literature takes pains to point out that the name of its flagship drink is not an acronym for “Pay Every Penny to Save Israel,” that its invention in fact predates the creation of that country by a half-century. After the second Intifada began in 2000, Coke had to enlist the help of the grand mufti of Egypt to dispel the rumor that its wavy logo and cursive script contained hidden anti-Islamic messages. Several months ago, it was claimed on Iranian state television that Coke, which has bottling plants in Iran, was “ready to allocate a great deal of money to topple the Islamic Republic.”

While such occasional fits of the collective imagination make for droll anecdotes, they distract from the profound shift that has occurred in boycott politics in the Arab world since the 1960s. By the late 80s, the pragmatic underpinnings of the Arab League’s boycott had grown increasingly spurious, its ideological commitments demoralized. Iconic products — and Coke was the epitome of this — were banned, while companies like McDonnell Douglas, which provided key weaponry to the IDF, were given a pass. After the first Gulf War, the oil states, led by Saudi Arabia, orchestrated a lifting of the League’s ban on Coca-Cola, as a sop to Americans for having “liberated” the region, and then 110 other companies were swiftly banned as a sop to those regional governments that still took a hard line against Israel and the US. The Arab League’s boycott has long since become the debased currency of a crippled realpolitik.

What is replacing this decadent state pageant is a form of grassroots boycott politics. Its spokespeople are drawn from student groups, as well as from civic and religious organizations; its communications infrastructure consists of the internet, text messaging, mosque sermons, and so on. It is more supple, responsive, and ad hoc in its nature and in several instances has forced the corporations it confronts to respond on its own turf; when a spontaneous boycott of McDonald’s began in 2002, the company paid to send 60,000 text messages to Lebanese cell phones, in an effort to dispel the rumor that a portion of the profits of every meal was contributed to Israel.

Some thirty-four years after the Coca-Cola logo was raised over the Golan Heights, the Italian anarchist Antonio Negri described how “transnational corporations have effectively surpassed the jurisdiction and authority of nation-states,” going on to call for a mode of resistance “adequate to the new dimensions of sovereignty.” It seems safe to say we’re not there yet with our resistance, and it isn’t clear what a grassroots collective action is going to do about the likes of McDonnell Douglas. But, though the new forms of activism may be vain and quixotic, at least they aren’t yet decadent.

“When they think of democracy, they think of Coca-Cola,” read a prominent placard at Coke’s first international convention. That was in 1948, and while Coke winked at the Cold War it remained still oblivious to the one warming up in Palestine. Several of the words in that slogan — including “they” and “democracy” — have surely undergone a transvaluation of sorts in subsequent decades; but the formula still holds, perhaps more literally than ever.