Charles Herbert Allen was a minor Massachusetts politician. He served two terms in the US Congress. Though he’d never served in the military, he loved to dress up as an 18th century Army officer and have people call him “Colonel.”
Allen was the first civilian governor of Puerto Rico (1900-1901), appointed by US President William McKinley. The governor arrived in epic fashion with a 21-cannon salute, the 11th US Infantry Band blaring before him, and hundreds of armed soldiers marching behind.
It rained heavily that day. The sky was gray and overcast – unusually dark for the island of Puerto Rico. As Allen strolled toward the governor’s mansion, an assistant covered him with an umbrella. Everyone but the governor got wet.
La Fortaleza, the governor’s mansion, was barely recognizable. It was wrapped like a Christmas present. Governor Allen declaimed his inaugural speech under the largest imperial flags that Puerto Ricans had ever seen.
Right after that speech, within just a few weeks, Allen created a “budget” for the entire island: without consultation or oversight from anyone. This “private” budget was highly useful…for Governor Allen.
By raising property taxes on every farmer, freezing all agricultural and small business loans, and cutting all building repair and construction funds, Allen raided the island’s treasury and used it to subsidize US-owned farm syndicates, no-bid construction contracts for US businessmen, and roads built by his father’s lumber business in Massachusetts (Otis Allen Lumber) at double the old costs.
Through his “private” budget, Allen hired “outside consultants” and fabricated new “agencies,” “commissions” and “review panels,” all filled by US expatriates. Within 17 months, by the time he left in 1901, nearly all of the governor’s 11-member Executive Council were US expats and over 50% of all appointive offices in the Puerto Rican government had been given to visiting Americans, 626 of them at top salaries.
But Allen had a larger plan. He used his “private budget” to commission an island-wide study of its soil productivity – then, in his “First Annual Report” to US President McKinley, Allen’s master plan became clear.
“The soil of Porto Rico is remarkably fertile…as rich as anywhere on earth.”
“With American money and know-how, the labor of the natives can be harnessed.”
“Porto Rico is truly the rich door to great profits.”
“The amount of sugar production per acre is greater than any other country in the world.”
This was no mere “First Annual Report” to President McKinley. It was a business plan for a sugar cane kingdom, and Allen quickly seized the throne. Within days of handing in his report on September 15, 1901, Allen resigned as Governor and rushed up to Wall Street – before anyone else could grab the opportunity – to become Vice-President of the Morgan Guaranty Trust Company.
Allen built the largest sugar corporation in the world, and his 626 political appointees showered him with water rights, land grants, railroad easements, zoning variances, tax abatements and tariff waivers.
Sugar cane train owned by US banking syndicates
By 1907 Allen’s corporation, the American Sugar Refining Company (ASRC) owned or controlled 98% of the sugar refining industry in the entire US.
By 1910, “Colonel” Allen was the Treasurer of the ASRC.
By 1913 he was President.
By 1915 he sat on its Board of Directors.
By 1930, twenty-five percent (25%) of the cultivated land in Puerto Rico, was owned by Allen and his company ASRC. They also owned the majority of the coastal railroad, the insular postal system, and the San Juan shipping terminal.
To put it plainly: the very first governor of Puerto Rico, Charles Herbert Allen, used his “governorship” to acquire an international sugar empire, and to gain a controlling interest over the entire Puerto Rican economy.
Allen’s empire has grown over the years. You may have heard of it. It is known today, as Domino Sugar.