Coca-Cola in World War II
Coca Cola During the War
Coca Cola Helps the American War Effort
When you think of Coca Cola, you might necessarily think of their history behind their ingredients, and their pricing wars with Pepsi Co. However, did you know that Coca Cola made a significant contribution to the war effort during the 2nd World War?
According to Coke's own site, their CEO at the time (Robert Wodruff) decreed that an American Serviceman, no matter where he was in the world, and no matter what conditions, would only pay 5 cents (the current going rate for a bottle of coke in the states) for a bottle or can of coke.
In addition, the Company itself was ordered to create several overseas bottling operations, in order to turn out 3 million bottles of coke every six months. A very patriotic act, that helped bring a little bit of America to each soldier.
As well, the company kept turning out domestic bottles, which allowed the American worker to produce the arsenal of democracy.
Economics of Patriotism
However, while I think many Coke employees had truly patriotic motives in mind, one can't help but notice that coke stood to gain both in the short-term and the long-term from the war. While I am not trying to point any fingers, I think the truth of the situation needs to be discussed.
Firstly, Woodruff stated that an American Service Member would only ever have to pay 5 cents per can of coke. In essence, this statement, and this stipulation, served as an advertising effort, as no more than 10 million of the US Population of 141 Million were in the Service. Those on the home-front though, seeing the company's support for the product, might be more inclined to purchase.
In addition, they were 'ordered' to create several more bottling plants around the world, to help deliver coke to the troops. Coke already had a foreign bottling network (albeit only three plants), and it is likely they had plans for expansion. This war gave the company its 'excuse' for expansion, and possibly a reasonable claim that they needed to be compensated (which they were both in sales contracts, and payments for services rendered after the war).
So, to say that their motives were entirely patriotic...well some patriotism was there. However, they profiteered from the war in another way.
Coke's Secret Brand
When America went to war with Germany, operations for the Coca Cola Company in Germany didn't end. Previously beforehand, Coke had a lucrative relationship and was one of three state-sponsored forms of refreshment at Nazi Sporting events.
However, there was one thing about their operations that did end. The specific use of the Coke Brand was discontinued, not out of some moral stand, but simply out of a lack of sources to make the soft-drink. Thus, German Coke employees decided to create a new drink made from fruit left-overs. When a brainstorming session was held to come up with a new name for the product, the director of the program told marketing teams to use their imagination ('fantisie' in German). One person apparently called out 'Fanta!' and the name stuck.
Now, the real question is, should Coke have been selling to Germany? I think the answer is a clear 'no' based upon historical precedent and the actual strategic difference it would have made in the war.
When Cuba came into Communism, very quickly we declared an embargo against them, and many of our products do not make it to Cuba. There are no bottling plants in Cuba, and if you go there, the only Coke available is from bottling plants in Mexico, and it is very expensive. I believe a similar policy was in existence for the Soviet Union officially or unofficially.
However, we weren't 'technically' at war with Cuba, and no bullets were trading between Americans and Cubans. Yet at the same time that we were at War with the Germans, an American company was profiteering from it? At first you may think this actually to be a win for the 'American Company', but that isn't the case. In addition, other companies (on the losing end) were declared 'war profiteers' and felt heavy burdens for this after the war.
Okay, so what is wrong with selling soda to the Germans during war? If we are profiting off of it, isn't that a good economic choice for us, even if we are at war?
In economics, you learn that there is no such thing as an unequal trade, except where-in you take by force (and even then you might consider it a trade for or against risk of injury or death), or through coercion. As long as the trade continued in a decent manner, the German consumer gains something of value, even by paying 5 cents (whereas the product might cost 3 to make).
What we must look at, is what effect does the selling of soda have upon the war effort (not whether it was a good choice for us economically). Truth is, by continuing to supply them with coke products, and coke formula, we were actually making life a little bit more bearable for the average German citizen during the midst of the war, and possibly prolonging it. These beleaguered citizens might find it alright to continue into a factory the next morning, to make German weapons of war.
When one sieges a castle, you don't have to ever storm it to kill the King, just starve the people until they kill the King themselves. Therefore, I think every single bit of coke product that was sold to the German People by an American Company, was not in our best interest, and frankly, I think the profits plus interest should be repaid.
However, that would never pass in a nation such as ours. Where corporations control what we see on TV, and what candidates we can possibly vote for.