News Smart Local News Funded by Smart Local People

How the Spanos Family Built a Fortune Selling Bologna Sandwiches to Mexican Farmworkers

The Spanos family, which owns the Chargers, is worth $2.4 billion. As the team asks the public to help fund a new stadium, many have wondered where the Spanos family fortune came from. For Alex Spanos, it started with bologna sandwiches and Mexican farmworkers. The family has long faced questions, in fact, of whether Spanos helped exploit farmworkers in the notorious Bracero program that started nearly 70 years ago.

There are “no poor football team owners,” as a spokesman for the Chargers recently put it.

Indeed.

The Spanos family, which owns the majority shares of the Chargers franchise, is worth $2.4 billion, according to Forbes.

As the team lobbies for public money to subsidize a new stadium and convention center, the Spanoses’ wealth has come under scrutiny: Why, people ask, should San Diego taxpayers use billions in public tax dollars to support billionaires?

Less understood is where the family fortune came from. Alex Spanos, the family’s 93-year-old patriarch, once had nothing but ended up building a real estate empire. How? To build great wealth, you have to first build up some money – capital – you can later invest.

For Spanos, it started with bologna sandwiches and Mexican farmworkers. The family has long faced questions, in fact, of whether Spanos helped exploit farmworkers in the notorious Bracero program that started nearly 70 years ago.

Spanos himself tells the story in his autobiography “Sharing the Wealth: My Story.” This is how it all began:

In summer 1951, Alex Spanos – the son of a Greek immigrant –  was both jobless and a father of two.

He borrowed $800 from a bank to start a catering business in his hometown of Stockton.

He saw demand from a new wave of migrant farmworkers circulating through the Central Valley. They were known as “braceros,” Spanish for laborers, and they were coming to harvest crops as part of a series of formal immigration agreements between the United States and Mexico.

Between 1942 and 1964, nearly 5 million of these Mexican workers came to do seasonal work in the United States. Initially, they were invited in because American men were off fighting World War II. By 1951, with the war over, American farmers had come to depend on the foreign workers.

At first, Spanos said he simply wanted to be a sandwich peddler, selling to workers during their breaks. He used the bank loan to buy a truck, a slicing machine, a meat cleaver, bread and the cheapest meat he could find – bologna.

In August 1951, he and his wife Faye made the sandwiches at night and he drove around selling them the next day. The farmers would buy the sandwiches and deduct the costs from the braceros’ wages.

Spanos quickly found another bigger opportunity: Farmers soon asked him find more Mexican men, bring these men back to Stockton and then house and feed them so they could work the farmers’ fields.

By mid-September 1951, Spanos had helped bring 350 braceros to Stockton. He’d found a place to house them: a building that days earlier had been the site of the San Joaquin County Fair’s vegetable exhibition.

On behalf of the farmers, Spanos also began to provide the workers three meals a day. These initial meals – boiled beans and bologna – cost Spanos 75 cents a day to make. For the food and lodging, he charged $1.75 a day.

“After making breakfast, lunch, and dinner, I still pocketed $1 profit per man per day,” Spanos wrote.

It’s that profit –$1 in 1951 would be about $9 in today’s money – that caught the eye of Tony Platt, a professor at Sacramento State.

Starting with a 2005 academic article, Platt began raising questions about Spanos’ bracero catering business, which Platt eventually called price-gouging, or charging an unreasonable amount of money for something.

As part of the agreement between the United States and Mexico, there was a standard work contract for braceros that said farmers could not charge more than a $1.75 for a day’s meals. But the contract also said meals should be provided to braceros “at cost,” which means without profit, and that housing should be free.“There’s no question they were getting gouged, because they couldn’t compete around the food that they were getting,” Platt told me of the Mexican farmworkers, noting that braceros often had little choice about where they ate. “I think [Spanos] was sort of the proud of the fact that he was able to make the first part of his fortune that way.”

In his autobiography, Spanos says he provided accommodations that were “suitable and nourishing.” After all, he is the son of an immigrant.

“The workers were coming to Stockton, where they had no place to sleep and nothing to eat,” Spanos wrote. “If I hadn’t made provisions, they would have slept in the fields instead of the beds I provided, and they would have eaten whatever the farmers could scrounge instead of the three meals that I served them each day.”

He admits, though, that the meals he initially fed braceros – of boiled beans and bologna – were “not an appropriate menu.”

According to a scholar of the bracero program, bologna sandwiches were considered especially bad food by braceros because Mexicans were accustomed to hot dishes for lunch and unaccustomed to white bread. They also didn’t like the flavor or texture of bologna.

The next year, Spanos writes that he moved the laborers from the county fair building to an old Army barracks near the Stockton airport. He also bought a tortilla machine and hired Mexican cooks.

Still, he kept making quite a bit of money from the catering business, which involved contracting with farmers to provide food to their braceros. By the end of 1951, Spanos had $35,000 in the bank – equivalent to about $300,000 in today’s dollars.

By 1956, Spanos writes that he was the largest caterer to braceros in the country.

That year, when the bracero program was at its peak and he was feeding 7,000 workers a day, Spanos said he “cleared almost $700,000, which was an unbelievable amount of cash for those days.” It would be about $6 million in today’s dollars.

Beyond complaints about the quality of the food, which Spanos said he fixed quickly, were complaints that braceros had no other options and meals were too expensive.

Some research from the time details these complaints, but none specifically cites Spanos or his operations.

In his book “Merchants of Labor: The Mexican Bracero Story,” labor activist Ernesto Galarza wrote that “No single aspect of the bracero program was the cause of more irritation than the food services. These were all too often operated by catering companies long inured to complaints, or by canny concessionaires who cut corners freely.”

There were allegations that braceros who wanted to cook their own meals were not allowed to, thereby locking them into buying relatively expensive meals that they likely didn’t even want to eat.

Henry P. Anderson, then a Berkeley graduate student, did field research among the bracero camps for a 1961 report and paid particular attention to price.

Anderson compared what braceros were getting to what other mess halls were serving. At a prison in Chino in 1959, inmates were fed a diverse menu with many options. The meals cost 68 cents to prepare and were, in Anderson’s judgement, “superior” to lower-quality meals that braceros paid $1.75 a day for. He visited one bracero camp that didn’t serve coffee or milk; the prison served both. He visited another bracero camp that ran out of meat, then tortillas and then beans so that several men in the back of the lunch line were left to eat just chopped cabbage and chili sauce.

The $1.75 charge – the maximum allowed – had become the standard price for a day’s meals, even if meals didn’t cost that much to prepare.

“What was intended as the maximum figure has become a standard figure,” Anderson writes. “This is proper if the food and labor which go into the meals actually cost the employer $1.75, or more. In cases where they do not, the law is being violated.”

Anderson said he didn’t talk with a single labor regulator who took the “at cost” language very seriously.

So if meals didn’t cost $1.75 to prepare – and as Spanos admitted, they did not – contractors like Spanos could pocket the difference.

Anderson did interview a Department of Labor representative in Southern California who said that while contractors are “entitled to make a living” some were “greedy.” The representative considered 25 to 50 cents per bracero per day “legitimate” but making $1.25 a day too much. He didn’t address the middle ground, the $1 per day profit that Spanos claimed.

In a statement to VOSD, Natalia Orfanos, who helped Spanos with his autobiography, responded on behalf of the family and the team.

She noted that the $1.75 per worker per day was paid to Spanos by the farmers, not directly by the braceros. The assumption is that the farmers, in turn, collected money directly from the braceros. She said she now has no way of knowing how much that was – though, as Anderson pointed out at the time, braceros in California ended up paying $1.75.

Orfanos also said Spanos had some overhead expenses, like housing, that are not accounted for in the book when Spanos talks about his “profit.” She also urged caution about using stories about the bracero program in general to apply to Spanos in particular.

The entire bracero program was vast. By the mid-1950s, for instance, over 400,000 braceros were working in this country and there were hundreds of bracero camps in California’s Central Valley.

“Therefore, in light of the fact that the federal Bracero Program was so far-reaching, we respectfully request that you be cautious about tying particular anecdotes to Mr. Spanos’ business when there were clearly many other businesses also serving the large federal program,” Orfanos said.

All this back-and-forth over Spanos’ earliest business venture in the 1950s seems to have come up in public only once, in a 2010 student newspaper story.

Yet a few people remain aware of Spanos’ history.

Dolores Huerta, a labor organizer who co-founded the United Farm Workers union with Cesar Chavez, grew up in Stockton and recalled Spanos during an 2005 interview she gave for the Bracero Oral History Project. She said typical meals for braceros were “not very nourishing.”

“You see some of these people now that their names [are on] on universities, and the Spanos family, in particular, became very wealthy,” she said. “They got then into real estate development, but that’s how they got their start, feeding the Braceros.”

Alex Spanos says in his autobiography that he ended up in real estate because of the industry’s tax advantages.

He remembers his accountant calling him up in 1956 with some advice.

File photo by Sam Hodgson

File photo by Sam Hodgson

“I suggest you find some real estate investments and take advantage of some tax shelters,” the accountant advised.

Spanos did.

Initially, he built apartments aimed at the top 10 percent of the market. Eventually, though, he decided to begin building apartments for the masses.

By 1977, Spanos was the largest apartment builder in the United States.

With the real estate fortune he began chasing a dream: to own a professional sports team, ideally a football team.

That the team he eventually bought was the San Diego Chargers is merely a matter of happenstance.

According to the book, he missed a chance to buy the Tampa Bay Buccaneers in 1974, lost a 1976 bid to buy the San Francisco 49ers and passed up a chance to buy the Oakland A’s in 1978.

In 1982, he bought a partial stake in the Chargers before he took ownership of the team in 1984.

After he bought the team, he thought about moving to San Diego but Faye told him she’d “rather not” leave Stockton.

Alex Spanos says his wife’s words saved him.

“When fans began booing me in the street and reporters kept hammering at me in the newspapers, I was especially grateful to be able to go home,” he wrote.

Alex Spanos eventually began turning over the reins of his businesses and the Chargers to his children and, in 2008, he announced he had dementia and retired from public life. Management of the team fell to his son, Dean, who has now turned it over to his sons, A.G. and John.

Dean Spanos has reserved one final task for himself: to find a new stadium home for the team his father bought.

Show Comments
Loading

We’re striving for the best possible discussion and may delete comments using our editorial judgment. All comments containing links will be reviewed by VOSD staff before they are published.
Read our full comment policy.
For longer comments, consider submitting an op-ed to Voice of San Diego.
Read the guidelines here.

We have implemented a new commenting system. Please note, old comments that were created before 1/17 may be missing while we complete the migration to our new system.