Homework 9- NEED IN 3 HOURS!!

Answer EACH of the following questions 150 words (Reading attached):

1. Why did military officers, a class commonly regarded as the staunchest defenders of the old order in Latin America, lead revolutions in the Andean republics of Bolivia, Peru, and Ecuador?

2. What economic and social reforms did these military leaders propose, and what interests did they represent?

3. How did indigenous resistance to political, social, and economic inequality affect these revolutions?

4. How did military corporatism aim to promote the rise of an autonomous native capitalism?

5. Why did the military reformers fail to make a clean break with the model of dependent development and the problems it generated?

NEOCOLONIALISM, THE MILITARY, AND INDIGENOUS RESISTANCE 401

But the Peruvian experience was the culmi-
nation of historical events that had long character-
ized the entire Andean region. As elsewhere on the
continent, Andean reformist movements fused the
effort to modernize with the struggle for greater so-
cial justice for the masses: economic sovereignty,
industrialization, and land reform. But the pres-
ence of large, compact indigenous groups, ranging
from some 70 percent of the population of Bolivia
to about 40 percent of the populations of Peru and
Ecuador, gave a distinctive character to these na-
tionalist movements. Still another common fea-
ture of the Andean struggle was the leading role
played by nationalist military offi cers, who, fear-
ing autonomous indigenous rights and militant
working-class movements, sought to contain
them by advancing a moderate corporatist reform
agenda rooted in the idea of a mestizo nation. Mili-
tary cor poratism gave indigenous, peasant, and
working-class communities representation in the
affairs of state but simultaneously denied them
power by requiring them to subordinate their re-
spective racial and class interests to serve an ideal-
ized nation-state that protected all sectors of society
equally. The historical origins of military corporat-
ism lay in early-twentieth-century struggles over
land, indigenous rights, and international capital-
ist development.

Neocolonialism, the Military,
and Indigenous Resistance
The War of the Pacifi c left a heritage of political
and social turbulence as well as economic ruin.
Military caudillos and civilian leaders in Peru dis-
puted one another’s claims to power and mobilized
montoneros (bands of guerrillas and outlaws) for
their armed struggles. In some areas, the indig-
enous peasantry, having acquired arms during the
war with Chile, rose in revolt against oppressive
hacendados and local offi cials. Banditry was rife in
parts of the sierra; on the coast, factions armed by
landowners or their agents fought among them-
selves for control of irrigation canals or over prop-
erty boundaries.

From the struggle for power the militarists
once again emerged victorious: in 1884, Andrés
Cáceres battled his way into Lima; seized the Na-
tional Palace; and initiated a slow, painful process
of economic recovery. His fi rst concern was the
huge foreign debt. In 1886 his government ne-
gotiated the so-called Grace Contract with British
bondholders. This agreement created a Peruvian
Corporation, controlled by the British bondhold-
ers, that assumed the servicing of Peru’s foreign
debt and received in exchange Peru’s railways for a
period of sixty-six years. The agreement confi rmed
British fi nancial domination of Peru but also ini-
tiated a new fl ow of investments that hastened
the country’s economic recovery. Particularly
important was the resulting rehabilitation of the
railways and their extension to important mining
centers, especially into La Oroya, whose rich silver,
zinc, and lead mines began to contribute to the eco-
nomic revival.

Economic recovery strengthened the political
hand of the planter aristocracy and the commercial
bourgeoisie, who were increasingly impatient with
the military caudillo’s unpredictability. In 1895
their leader was the fl amboyant Nicolás Piérola,
who sought to bring the military under civilian
control and led a successful revolt against Cáceres.
Piérola presided over four years of rapid economic
recovery. On the coast, he promoted an intensive
“modernization” that expanded sugar plantations
at the expense of small landholders and indigenous
communities. In the Andes, the economic revival
spurred a renewed drive by hacendados to acquire
indigenous communal lands, a drive extended to
regions hitherto free from land-grabbing. An 1893
law, which effectively reenacted Bolívar’s decree
concerning the division and distribution of com-
munal lands, facilitated the process of land acquisi-
tion. In this period there also arose a new contract
labor system, the enganche, designed to solve the
labor problem of coastal landlords now that Chi-
nese contract labor was no longer easily available.
By this system, indígenas from the sierra were forc-
ibly recruited for prolonged periods to labor on
coastal haciendas, sometimes under conditions of
virtual serfdom.

402 CHAPTER 16 STORM OVER THE ANDES

INDIGENOUS RESISTANCE

The War of the Pacifi c had a similarly catastrophic
impact on Bolivia, which it left landlocked and
deprived of revenues from rich deposits of ni-
trates and copper. Bolivia’s national government
remained discredited and weak, rendering local
landlords still more powerful. Here also, however,
indigenous struggles unfolded within the histori-
cal context of racial, class, and gender confl icts
unleashed by foreign investment, transatlantic
market growth, and dependent capitalism. During
the late nineteenth century, highland indigenous
communities had agreed to pay tribute and provide

seasonal labor services to Hispanic hacendados in
exchange for their recognition of indigenous com-
munal land rights, but the lure of larger profi ts pro-
duced by a growing market demand for exports led
them to expand their haciendas at the expense of
the indígenas.

As a result, in the early twentieth century, the
caciques apoderados, an armed indigenous move-
ment, spread throughout the Andean highlands.
These indigenous rebels defended their community
lands and cultural traditions in violent uprisings
like the 1921 Aymara Rebellion and the Cha-
yanta Rebellion of 1927, which together mobilized
thousands of peasants. This rural ferment, further

The Rumi Maqui movement drew upon a long tradition of indigenous resistance to
assert traditional communal values in the face of an aggressive expansion of the
mining industry, large plantations, and commercial agriculture in Peru and Bolivia.
[From “South of Panama” (New York: The Century Company, 1915), by Edward Alsworth Ross]

NEOCOLONIALISM, THE MILITARY, AND INDIGENOUS RESISTANCE 403

complicated by growing worker unrest in Bolivian
mines, factories, and urban centers, where a na-
scent women’s movement also became active, led
to greater collaboration among the army, landed
oligarchs, and their foreign allies.

The aftermath of the War of the Pacifi c also
saw the birth of a new sensitivity to the social
struggle of indigenous peoples in Peru. The rise of
this indigenismo among intellectuals was closely
connected with the crisis of conscience caused by
this disastrous war. By exposing the incompetence
and irresponsibility of a creole elite that had totally
failed to prepare materially and morally, the war
led many intellectuals to turn to the indigenous
peasantry as a possible source of national regen-
eration. At the University of San Marcos in Lima,
there arose a generation of teachers who rejected
the traditional positivist, racist tendency to brand
Indians as inherently inferior. The alleged apa-
thy, inertia, and alcoholism of indigenous peoples,
these scholars claimed, resulted from the narrow,
dwarfed world in which they were forced to live.
But as a rule, these bourgeois reformers ignored
the economic conditions of indigenous peoples and
focused on a program of education and uplift that
would teach them ways to enter the new capitalist
society.

The great iconoclast Manuel González Prada
(1848–1918) rejected this gradual, reformist ap-
proach to the problem. “The Indian question is an
economic and social question rather than one of
pedagogy,” he wrote. Schools and well-intentioned
laws could not change a feudal reality based on
the economic and political power of the gamona-
les (great landowners), lords of all they surveyed.
Elimination of the hacienda system, therefore, was
needed to rescue indigenous people. But, accord-
ing to González Prada, that change would never
come through the benevolence of the ruling class:
“The Indian must achieve his redemption through
his own efforts, not through the humanity of his
oppressors.” He consequently advised them to
spend on rifl es and cartridges the money they now
wasted on drink and fi estas. His powerful indict-
ment of the oppressors of indigenous peoples, his
faith in their creative capacity, and his rebellious

spirit, expressed in prose that fl owed like molten
lava, profoundly infl uenced the next generation of
intellectuals.

For their part, indigenous highland commu-
nities, whose passive resistance to the gamonales’
encroachment on their lands and autonomy the
intellectuals had mistaken for laziness and apathy,
now openly rebelled. Sparked by indigenous lead-
ers like Teodomiro Gutiérrez Cuevas, the Rumi
Maqui movement, a millenarian insurrection that
swept like wildfi re through southern Peru and the
central sierra between 1915 and 1930, proclaimed
the restoration of Tawantinsuyu, the fabled empire
of the great Inca kings.

THE LEGUÍA REGIME: NORTH AMERICAN
INVESTMENT AND PERUVIAN DISILLUSIONMENT

Integration of indigenous peoples was Peru’s grav-
est social problem, but the rapid economic advance
that began under Piérola produced the emergence
of a working class whose demands also threat-
ened the peace and security of the ruling class. By
1904 an organized labor movement had arisen,
and strikes broke out in Lima’s textile mills and
other factories. In 1918, during World War I, min-
ers, port workers, and textile workers, respond-
ing to a catastrophic infl ation of food prices, went
on strike. Armed clashes took place between the
strikers and the troops sent out to disperse them,
and many strikers were arrested. News of the suc-
cess of the Russian Revolution contributed to the
workers’ militancy. This movement culminated
in a three-day general strike in January 1919; the
workers demanded the implementation of cur-
rently unenforced social legislation, the reduction
of food prices, and the imposition of the eight-hour
workday. Under pressure from the workers, the
government granted some demands, including the
eight-hour day for the manufacturing and extrac-
tive industries. The labor struggles of that stormy
year merged with the struggle of university stu-
dents for the reform of an archaic system of higher
education that made the university the preserve of
a privileged few and denied students any voice in
determining policies and faculty appointments.

404 CHAPTER 16 STORM OVER THE ANDES

But sections of the oligarchy were convinced
that this new and unstable political and social at-
mosphere required a different way of ruling. An
astute businessman and politician, Augusto B.
Leguía, offered a new Caesarist political model
that combined unswerving fi delity to the domi-
nant domestic and foreign interests with severe
repression of dissidents and a demagogic nation-
alist reform program designed to disarm workers
and achieve class peace. In July 1919 he seized
power and established a personal dictatorship that
lasted eleven years (1919–1930).

Leguía encouraged by every means at his
disposal the infl ux of foreign—especially North
American—capital. This was the cornerstone of
his economic policies. Oil and copper were major
fi elds of North American investment in Peru in
this period. The fruits of Leguía’s policy of opening
the doors wide to foreign capital soon became evi-
dent. In 1927 a vice president of the First National
City Bank wrote that “Peru’s principal sources
of wealth, the mines and oil-wells, are nearly all
foreign-owned, and excepting for wages and taxes,
no part of the value of their production remains
in the country.” Perhaps the most scandalous
example of Leguía’s policy of giving away Peru’s
natural resources was his cession of the oil-rich
La Brea–Pariñas fi elds to the International Petro-
leum Company (IPC), a subsidiary of Standard Oil
of New Jersey, in return for a minimal tax of about
71 cents a ton. This cession and a 1922 arbitral
award confi rming the dubious claims of an English
oil company, whose rights had passed to the IPC,
became an abiding source of Peruvian nationalist
resentment.

Peru under Leguía received a plentiful infu-
sion of North American loans, amounting to about
$130 million. The bankers were aware of the risks
involved, but the prospects of extremely large prof-
its made these transactions very attractive. A trail
of corruption, involving Leguía’s own family, fol-
lowed these deals; Leguía’s son Juan, acting as an
agent for Peru, received more than half a million
dollars in commissions.

Leguía used the proceeds of these loans and
the taxes on foreign trade and foreign investment

operations for a massive public works program (in-
cluding a large road-building program carried out
with forced indigenous labor) that contributed to
the boom of the 1920s. During those years, Lima
was largely rebuilt, provided with modern drink-
ing water and sanitation facilities, and embellished
with new parks, avenues, bank buildings, a race-
track, and a military casino. But these amenities
did not improve the living conditions of Andean
peoples or dwellers in the wretched barriadas
(shantytowns) that began to ring Lima.

Convinced that the threat of communism re-
quired some concessions to the masses, however,
Leguía did make some gestures in the direction of
reform. The constitution of 1920 had some strik-
ing resemblances to the Mexican constitution
of 1917. It declared the right of the state to limit
property rights in the interest of the nation, vested
ownership of natural resources in the state, and
committed the state to the construction of hospi-
tals, asylums, and clinics. It empowered the gov-
ernment to set the hours of labor and to ensure
adequate compensation and safe and sanitary con-
ditions of work. It also offered corporate recogni-
tion of indigenous communities, proclaimed their
right to land, and promised primary education to
their children. But these and other provisions of the
constitution were, in the words of Fredrick Pike, a
“model for the Peru that never was.”

That same contrast between promises and
performance marked Leguía’s labor policy. Dur-
ing his campaign for the presidency, he denounced
“reactionaries” and made lavish promises to the
workers. Indeed, on seizing power in July 1919,
he immediately freed the labor leaders imprisoned
under Pardo. He also permitted a congress of work-
ers to meet in Lima in 1921 and form a Federa-
tion of Workers of Lima and Callao. But when the
labor movement began to display excessive inde-
pendence, he intervened to crush it. Workers were
forced to accept token reforms and a program of
government- and church-sponsored paternalism,
crumbs from the well-laden table of the wealthy.

Leguía’s performance was especially disillu-
sioning to the university students. Impressed by
his promises of educational reform, they had pro-

NEOCOLONIALISM, THE MILITARY, AND INDIGENOUS RESISTANCE 405

claimed him “Mentor of the Youth” and supported
his presidential campaign in 1919. But once in
power, he sought to drive a wedge between stu-
dents and workers, jailing student leaders and out-
lawing the Popular University of González Prada,
organized by the students to provide workers with
political education. Frequent jailings and deporta-
tions of dissident journalists and professors brought
Leguía into chronic confrontation with students
and faculty, who often went on strike, while the
University of San Marcos was repeatedly closed
down by the government.

The fl edgling women’s rights movement
also fragmented during the Leguía dictatorship.
In 1914, María Jesús Alvarado Rivera had cre-
ated Evolución Feminina, a journal devoted to the
cultivation of cross-class, interracial alliances in
pursuit of women’s liberation and social justice.
But patrician women refused to join these mixed-
race organizations. According to Carrie Chapman
Catt, the U.S. feminist and president of the Pan-
American Women’s Suffrage Alliance, “the pure
Castillian woman would die before she moved
equally herself with those of color.” As a result, an
aristocratic Peruvian National Women’s Council
supported Leguía, resisted broader social reforms,
and largely favored enfranchisement of literate
women because it would strengthen their elit-
ist cause. Radicals like Alvarado and Magda Por-
tal soon abandoned this feminism dominated by
“damas patrióticas civilistas” and joined the class
struggle against Leguía.

INDIGENISMO AND SOCIALISM

The traditional oligarchical parties’ surrender to
the dictator and the weakness of the young Peru-
vian working class meant that the leadership of
the opposition to Leguía fell to middle- and lower-
middle-class intellectuals who sought to mobilize
the peasantry and the workers for the achieve-
ment of their revolutionary aims. Socialism, anti-
imperialism, and indigenismo provided the ideo-
logical content of the movement that issued from
the struggles of the turbulent year of 1919, but in-
digenismo was the most important ingredient.

Infl uenced by the revered González Prada,
these intellectuals believed that the revolution
necessary to regenerate Peru must come from the
sierra, from the Andean indigenous peoples, who
would destroy age-old systems of oppression and
unify Peru again, restoring the grandeur that had
been the Inca Empire. Common to most of the in-
digenistas was the belief that the Inca Empire had
been a model of primitive socialist organization, a
thesis rejected by modern scholars. Although al-
most all land in Peru was individually owned and
worked by the 1920s, they also believed that the
indigenous community had been and still was the
“indestructible backbone of Peruvian collectiv-
ity.” The mission of intellectuals, in their view, was
to blow life into the coals of indigenous rebellion
and link it to the urban revolution of students and
workers.

An infl uential indigenista of this period was
Luis E. Valcarcel, author of the widely read Tem-
pest in the Andes (1927). In ecstatic prose, Valcarcel
hailed indigenous revolts of the sierra as portents
of the coming purifying revolution. A more impor-
tant and systematic thinker, José Carlos Mariátegui
(1894–1930), attempted the task of wedding in-
digenismo to the scientifi c socialism of Marx and
Engels. His major work was the Seven Interpretive
Essays on Peruvian Reality (1928). Basing his the-
ory on indigenous communal practices and tra-
ditions, on the revolutionary experience of other
lands, and on his study of history and economics,
Mariátegui concluded that socialism offered the
only true solution for the indigenous problems.

Like other indigenistas of his time, Mariátegui
idealized the Inca Empire, which he regarded as
the “most advanced primitive communist organi-
zation which history records.” But he opposed a
“romantic and anti-historical tendency of recon-
struction or re-creation of Inca socialism,” for only
its habits of cooperation and corporate life should
be retained by modern scientifi c socialism. More-
over, he stressed that the urban proletariat must
lead the coming revolution. Before his untimely
death, Mariátegui founded the Peruvian Socialist
Party in 1928 and sought affi liation with the Com-
munist International.

406 CHAPTER 16 STORM OVER THE ANDES

Indigenismo was a major plank in the program
of the Alianza Popular Revolucionaria Americana
(APRA), a party founded in Mexico in May 1924
by Victor Raúl Haya de la Torre and Magda Por-
tal, student leaders who had been exiled by Leguía.
Haya de la Torre proclaimed that APRA’s mission
was to lead the indigenous and proletarian masses
of Peru and all “Indo-America” in the coming so-
cialist, anti-imperialist revolution. Despite the high-
sounding rhetoric of Aprista propaganda, the party’s
fi rst concern was, and remained, Peru’s middle sec-
tor: artisans, small landowners, professionals, and
small capitalists. These groups’ opportunities for
development diminished as a result of the growing
concentration of economic power in Peru by for-
eign fi rms and a dependent big bourgeoisie.

In a revealing statement in the mid-1920s,
Haya de la Torre declared that the Peruvian work-
ing class, whether rural or urban, lacked the class
consciousness and maturity needed to qualify it
for the leadership of the coming revolution. He as-
signed that role to the middle class. To this opinion
he joined a belief in the mission of the great man
(himself) who “interprets, intuits, and directs the
vague and imprecise aspirations of the multitude.”
Portal’s view of Peruvian women was equally
condescending: without APRA’s guidance, she
insisted, they could not be entrusted with the vote
because of their low “cultural level” and “unques-
tioning dependence on masculine infl uence.”

Haya de la Torre early assumed an ambiguous
position on imperialism. Refuting Lenin’s theory
that imperialism was the last stage of capitalism,
he argued that in weak, underdeveloped countries
like Peru, imperialism was the fi rst stage. In effect,
imperialism provided the capital needed to create
industry, a powerful working class, and the middle
class that ultimately would lead the nation in a
socialist revolution. Switching from this position
to the belief that imperialism must be encouraged
and defended was an easy step for Haya de la Torre
to take. Mariátegui, who was associated with Haya
de la Torre in the student and labor struggles of the
early 1920s, soon perceived the inconsistencies of
his position and assailed APRA for its “bluff and
lies” and its personalism. Despite, or precisely be-

cause of, its vague, opportunistic ideology, APRA
managed to win over an important section of the
Peruvian middle class, especially the students,
during the three decades after 1920. It also gained
great infl uence over some peasant groups and
urban workers, whom it organized into unions
that were its main political base.

APRA VERSUS THE MILITARY

The onset of a world economic crisis in 1929, which
caused a serious decline of Peruvian exports and
dried up the infl ux of loans, brought the collapse of
the Leguía dictatorship. But neither the small Com-
munist Party nor the stronger APRA movement
was able to take political advantage of Leguía’s
downfall. A cholo (i.e., indigenous) army offi cer,
Luis Sánchez Cerro, seized power and became the
dominant fi gure in a populist ruling military junta.
Sánchez Cerro soon proclaimed the primacy of the
indigenous problem, the need for agrarian reform
through expropriation of uncultivated lands, and
the aim of regulating foreign investments in the
national interest. In effect, Sánchez Cerro had sto-
len much of APRA’s thunder, to the annoyance of
Haya de la Torre.

But the Apristas nonetheless launched an un-
successful revolt in 1932 that led to mass execu-
tions and the assassination of Sánchez Cerro. This
created a vendetta between the army and APRA
that helps explain the long, stubborn opposition
of the Peruvian armed forces to APRA’s assump-
tion of power, whether by force or peaceful means.
More important, it enabled the fi nancial and landed
oligarchy to consolidate its power. Thereafter,
it courted foreign investors like the U.S.-based
International Petroleum Company and promoted
export production. But a stagnant economy en-
sued due to low prices for the country’s chief ex-
ports (copper, cotton, lead, and wool), a situation
only temporarily relieved by growing demand and
high prices during World War II (1939–1945) and
the Korean war (1950–1953).

In the wars’ aftermath, however, Peru, de-
spite modest development of its extractive mineral
industry, remained a largely agricultural, export-

THE LIMITS OF POPULISM, 1952–1968 407

dependent country with a wealthy, powerful
landed oligarchy, a weak and fragmented middle
class, a marginalized indigenous peasant major-
ity, and a largely unorganized and undeveloped
urban working class. Nonetheless, APRA militants
continued to agitate for policies designed to restore
popular democracy, renew anti-imperialist strug-
gle, and promote social justice. Largely infl uenced
by the comandos femeninos, these policies included
land reform; civil and political equality irrespective
of race, class, or gender; and state regulation of for-
eign investment. In 1955, Peruvian women fi nally
won the right to vote, but little more. APRA’s male
leadership, fearful of a growing lower-class power,
increasingly abandoned women and their social
justice issues to curry favor with landed elites.

Meanwhile the inequities of Peru’s income
distribution continued to increase, as did collisions
between large landowners and increasingly mili-
tant, well-organized indigenous peasants. In some
cases, peasants revolted against precapitalist labor
systems (like the yanacona, which often required
personal service); in others, violence arose because
landowners tried to evict their indigenous tenants
and sheep in favor of wage labor and cash rent sys-
tems. These evictions increased landlessness and
population pressure in indigenous communities,
thereby accelerating the fl ow of highland emi-
grants to the coast, where they swelled the popula-
tion of city slums and shantytowns.

This fi rst generation of indigenous highland
migrants, known as provincianos, now found
themselves in a foreign environment, surrounded
by hostile urban elites who ridiculed their rural
lifestyles, scorned their racial origins, and limited
their social, economic, and political opportunities.
For hundreds of years, Peru’s criollo elite had pre-
served its cultural authority and political power by
institutionalizing a rigid race-based social hierar-
chy that defi ned criollos as “white,” civilized, and
superior; it likewise identifi ed indigenous peoples,
mestizos, and blacks as inferior, barbaric, ignorant,
and uncivilized. Not surprisingly, the new migrants
sought to assimilate into their strange surround-
ings by publicly emulating criollo culture even
as they privately celebrated their various high-

land traditions. They settled together in barriadas
(slums) or pueblos jóvenes (squatter communities)
and often supported their families by opening small
businesses in the informal sector, selling a broad
range of commodities on street corners, or work-
ing as domestic servants.

The Limits of Populism,
1952–1968

THE 1952 BOLIVIAN REVOLUTION

Against a similar background of indigenous con-
fl icts with creole landlords and class warfare be-
tween mineworkers and foreign mine owners,
revolution was brewing in Bolivia during World
War II. This was accelerated by the disastrous re-
sults of the Chaco War (1932–1935), which dou-
bled the size of Paraguay at the expense of Bolivia,
whose army was disgraced. (See the map in Chap-
ter 9, p. 210.) Even more problematic, however,
was the Bolivian military’s desperate effort to force
indigenous highland conscripts to fi ght in the hot,
humid lowlands on behalf of a nation they did not
recognize. This only exacerbated indigenous un-
rest. In addition, the social turmoil unleashed by
the global economic depression and the growing
wartime domination of foreign mining companies,
originally inspired by skyrocketing demand for Bo-
livia’s strategic mineral raw materials, combined
to alienate middle-class support for successive mili-
tary dictatorships that had dominated the Bolivian
State.

The last straw was the army’s 1942 Cataví
massacre of unarmed striking miners and their
families. Fearing greater social unrest, the mobi-
lization of popular sectors, and its implications for
their own power and property, middle-class activ-
ists organized the National Revolutionary Move-
ment (MNR) and led a massive protest that brought
the reformist government of Gualberto Villaroel to
power the following year. But Villaroel was assas-
sinated three years later. Thereafter, during a six-
year struggle, the MNR mobilized the countryside
and urban centers. Women especially played a

408 CHAPTER 16 STORM OVER THE ANDES

signifi cant role: the Women Workers’ Federation
(FOF) and the Barzolas, the MNR’s infamous fe-
male “secret police” (named for María Barzola, a
woman miner who died in the Cataví massacre),
organized street demonstrations, hunger strikes,
and other political protests.

By 1952 the MNR, led by Victor Paz Estens-
soro, fi nally overthrew the rule of the great land-
lords and tin barons with the support of armed
miners and peasants. The Bolivian land reform,
begun by the spontaneous rising of the peasantry
and legitimized by the revolutionary government
of President Paz Estenssoro, broke the back of the
latifundio system in Bolivia. Like the Mexican land
reform, however, the Bolivian reform created some
new problems even as it solved some old ones. The
former latifundia were usually parceled out into
very small farms—true minifundia—and the new
peasant proprietors received little aid from the gov-
ernment in the form of credit and technical assis-
tance. Yet, despite its shortcomings, the Bolivian
land reform brought indisputable benefi ts: some
expansion of the internal market; some rise in peas-
ant living standards; and, in the words of Richard
W. Patch, “the transformation of a dependent and
passive population into an independent and active
population.”

Women, workers, and indigenous communi-
ties became politically energized. Women joined
private charitable associations and international
organizations like the Inter-American Women’s
Commission (CIM) to agitate for the right to vote,
civil equality, indigenous rights, and greater access
to education. Lydia Gueiler Tejada, for example, ad-
vocated “the free association of women in legitimate
defense of her interests, without distinction of class,
race, creed, or even political ideas.” Mineworkers,
led by Juan Lechín, demanded nationalization of
the tin mines and control obrero—workers’ control
in the management of state-owned mines. Indige-
nous communities called for immediate, wholesale
land reform and greater cultural freedom.

In response, the new government nationalized
the principal tin mines, most of which were con-
trolled by three large companies, and recognized
its debt to the armed miners by placing the mines

under joint labor-government management. It
also abolished the literacy and gender restrictions
on voting and thus enfranchised women and the
indigenous masses. But the new regime inherited a
costly, rundown tin industry, while the initial dis-
ruptive effect of the agrarian reform on food pro-
duction added to its economic problems.

Increasingly fearful of the lower classes’ revo-
lutionary demands for equality and social justice,
and under strong pressure from the United States,
which made vitally needed economic aid to the
revolutionary government conditional on the
adoption of free-market policies, the MNR lead-
ership gradually abandoned its populist agenda.
The government of Paz Estenssoro offered gener-
ous compensation to the former owners of expro-
priated mines, invited new foreign investment on
favorable terms, ended labor participation in the
management of the government tin company, and
reduced welfare benefi ts to miners.

Likewise, Paz abandoned any particular in-
terest in women’s rights or their social agenda
and, instead, cynically manipulated the party’s
historic support for women’s enfranchisement
to secure their votes. According to Domitila Bar-
rios de Chungara, a militant activist in the mine-
workers’ Committee of Housewives (CAC), Paz,
who excluded women from leadership positions
in the government, nonetheless used the Barzolas
women to disrupt radical working-class protests:
“The Barzolas would jump in front of them, bran-
dishing razors, penknives, and whips, attacking
the demonstrators.” But the largely middle-class
male movement’s patriarchal prejudices clearly
limited the political ascendancy of women revo-
lutionaries like Gueiler Tejada, a militant feminist
and one-time commander of MNR militias, whose
political infl uence dissipated after she was assigned
to a distant diplomatic post in Germany.

Paz also ignored the needs of Bolivia’s indig-
enous peoples, which caused Laureano Machaka,
an Aymara peasant leader opposed to the govern-
ment’s policies, to organize a short-lived indepen-
dent Aymara Republic in 1956. Equally important,
Paz agreed to the restoration of a powerful U.S.-
trained national army to offset the strength of

THE LIMITS OF POPULISM, 1952–1968 409

peasant and worker militias. These retreats broke
up the worker–middle class alliance formed during
the revolution, undermined populist reforms, and
facilitated the military’s seizure of power in 1964.

In the violent ebb and fl ow of Bolivian poli-
tics thereafter, a persistent theme was the confl ict
among radical workers, women, and students on
one side and a coalition of elite businessmen and
politicians grown wealthy through U.S. aid on the
other. The indigenous peasantry, neutralized by
a populist agrarian reform that satisfi ed its land
hunger, initially remained passive or even sided
with the government in its struggles with labor,
but later unrest began to grow as a result of dete-
riorating economic conditions and a growing con-
sciousness of their collective indigenous identity.
Increasingly, the military intervened in Bolivian
politics to resolve these confl icts and impose a so-
cial stability through force of arms.

PERU’S BELAÚNDE: INDIGENISTA POPULISM
AND BROKEN PROMISES

Following the lead of his populist neighbors to the
east, Fernando Belaúnde Terry organized his presi-
dential campaign in Peru with a decided indigeni-
sta tinge. Visiting the remotest Andean villages,
Belaúnde extolled the Inca grandeur, called on
the natives to emulate the energy and hard work
of their ancestors, and proclaimed the right of the
landless peasantry to land. But his performance
in the fi eld of agrarian reform did not match his
promises. The agrarian law that issued from Con-
gress the following year stressed technical im-
provement rather than expropriation and division
of latifundia, with the hope that hacendados would
adopt modern methods to improve production. As
amended in Congress by a coalition that included
Apristas, the law exempted from expropriation the
highly productive coastal estates, whose workers
had been unionized by APRA, and reserved archaic
hacienda lands in the sierra for redistribution. But
the loopholes or exceptions were so numerous that
the law produced very modest results.

Meanwhile, Belaúnde’s lavish promises had
given great impetus to peasant land invasions. By

October 1963, invasions had multiplied in the cen-
tral highlands and were spreading to the whole
southern part of the sierra. The land-invasion move-
ment also changed its character; whereas before the
peasants had seized only uncultivated lands, they
now occupied cultivated land, arguing that they had
paid for it with their unpaid or poorly paid labor of
several generations. Militant peasant unions under
radical leadership appeared, and a guerrilla move-
ment arose in parts of the sierra. Meanwhile, a wave
of strikes broke out in the cities, and workers occu-
pied a number of enterprises in Lima and Callao.

These outbreaks took the Belaúnde admin-
istration by surprise. The hacendados, supported
by APRA, demanded the use of the armed forces
to repress the peasant movement. Indeed, APRA—
once so “revolutionary”—called for the harshest
treatment of the rebellious peasants. At the end of
1963, after some vacillation, the Belaúnde govern-
ment decided to crush the peasant movement by
force, a task the armed forces apparently assumed
with reluctance, preferring “civic action” programs
of a reformist type. According to one estimate, the
repression left 8,000 peasants dead and 3,500 im-
prisoned, 14,000 hectares of land burned with fi re
and napalm, and 19,000 peasants forced to aban-
don their homes.

Belaúnde had failed to solve the agrarian
problem. He also failed to keep his promise to settle
the old controversy with the International Petro-
leum Company over the La Brea–Pariñas oil fi elds,
which, Peru claimed, IPC had illegally exploited for
some forty years. Finally, under strong pressure
from U.S. interests, who delayed large planned in-
vestments in Peru, Belaúnde’s government signed
the Pact of Talara, which represented a massive
surrender to the IPC. Peru regained the now al-
most exhausted oil fi elds but in return agreed to
the cancellation of claims for back taxes and illegal
profi ts amounting to almost $700 million. IPC also
received a new concession to exploit a vast area in
the Amazon region and was allowed to retain the
refi nery of Talara, to which the government agreed
to sell all the oil produced from the wells it had re-
gained at a fi xed price. A scandal rocked the coun-
try when the government, forced to publish the

410 CHAPTER 16 STORM OVER THE ANDES

document, claimed to have “lost” the page setting
the price that the IPC must pay the state oil com-
pany for its crude oil. As public indignation grew,
the armed forces, opposition parties, and even the
Catholic Church denounced the agreement.

For Peru’s military leaders, this was the last
straw. For some years, they had engaged in intense
soul-searching over the past and future of their
country; now they were convinced that Belaúnde’s
government and the social forces that supported it
had sold out the national interest and were inca-
pable of solving Peru’s problems. In October 1968

the armed forces seized the presidential palace,
sent Belaúnde into exile, and established a military
governing junta that began a swift transformation
of Peru’s economic and social structures.

Military Corporatism and
Revolution, 1968–1975

THE PERUVIAN MILITARY ABOUT-FACE

Initially, the military seizure of power appeared to
be another in the long series of military coups that
punctuated the history of Peru and other Latin
American countries—coups that changed the oc-
cupant of the presidential palace but left the exist-
ing order intact. However, under the leadership of
General Juan Velasco Alvarado, the self-proclaimed
“Revolutionary Government of the Armed Forces”
quickly distinguished itself from this tradition. In-
stead, it decreed laws that called for nationalization
of oil, a sweeping agrarian reform, and workers’
participation in the ownership and management
of industrial concerns.

Observers found these events as startling, in
the words of Fidel Castro, “as if a fi re had started
in the fi rehouse,” for the Latin American military
had traditionally been regarded as loyal servants
of the area’s oligarchies. But in Peru, a social and
ideological gulf had been developing between the
military and civilian elites for decades. Most army
offi cers came from a military family or from the
lower-middle class. These offi cers, fearing the rise of
an autonomous, indigenous peasant and working-
class radicalism, sought to protect and promote
national capitalist development in Peru by shift-
ing power from landed oligarchs, foreign investors,
and their government representatives to a socially
responsible state controlled by a nationalistic new
bourgeoisie.

Within a week, the Velasco junta had nation-
alized the IPC’s oil fi elds and its refi nery at Talara
and soon after seized all its other assets. Having set-
tled the IPC question, the junta went on to tackle
the country’s most burning economic and social
questions.

General Juan Velasco Alvarado led the Revolution-
ary Government of the Armed Forces in 1968 and,
invoking the immortal words of the revolutionary
Inca Tupac Amaru, proclaimed to Peru’s impover-
ished campesinos and indigenous communities
that “the boss will now no longer eat from your
poverty!” [AP Images]

MILITARY CORPORATISM AND REVOLUTION, 1968–1975 411

LAND REFORM AND NATIONALIZATION
OF RESOURCES

Land reform was the key problem: Peru could not
achieve economic independence, modernization,
and greater social democracy without liquidat-
ing the ineffi cient, semifeudal latifundio system,
the gamonal political system that was its corollary,
and the coastal enclaves of foreign oligarchical
power. Major specifi c objectives were to expand
agricultural production and to generate capital
for investment in the industrial sector; thus, land-
owners were to be compensated for expropriated
lands with bonds that could be used as investment
capital in industry or mining. On June 24, 1969,
President Velasco announced an agrarian reform
designed to end the “unjust social and economic
structures” of the past. The program deviated from
orthodox Latin American reform policies in two
respects: fi rst, it did not retain the homestead or
family-sized farm as its ideal, and second, it did not
exempt large estates from expropriation on account
of their effi ciency and productivity. Indeed, the fi rst
lands to be expropriated were the big coastal sugar
plantations, largely foreign-owned and constitut-
ing highly mechanized agro-industrial complexes.
These enterprises were transferred to cooperatives
of farm laborers and refi nery workers.

Next came the turn of the haciendas in the
sierra. The reform applied to most highland estates
above 35 to 55 hectares and initially aimed to en-
courage division of estates into small or medium-
sized commercial farms, but this would have
reduced the number of potential benefi ciaries.
Under pressure from militant, unionized peasants,
who were demanding employment and the forma-
tion of cooperatives, the junta moved from parcel-
lation toward cooperative forms of organization.
Eventually, fully 76 percent of the expropriated
lands were organized into cooperatives, with the
remainder distributed in individual plots.

The agrarian reform produced some undeni-
able immediate and long-range benefi ts. To begin
with, it ended the various forms of serfdom that
still survived in the sierra. Second, food production
increased, though not substantially or to the level

required by Peru’s growing population. Third, ac-
cording to a 1982 fi eld study of the agrarian reform,
it “proved a major economic and political benefi t to
a signifi cant sector of the peasantry,” at least in the
case of cooperatives with an adequate capital en-
dowment. “In such cooperatives, members’ wages
and quality of life improved, often dramatically.”

But these gains were offset by the failure of the
agrarian reform to improve the general material
and political condition of the Peruvian peasantry—
a failure stemming from incorrect planning and
methods on the part of the well-meaning military
reformers. First, the reform was neither as swift
nor as thorough as the dimensions of the problem
required. Delays in implementing the program
and the ruses employed by landowners to evade it
meant that a considerable amount of land escaped
expropriation. As a result, the reform made only a
slight impact on the problem of landlessness and
rural unemployment and underemployment, es-
pecially in the sierra.

Second, the military reformers lacked a coher-
ent strategy for the general modernization of the
agricultural sector within an overall plan of bal-
anced, inwardly directed national development.
Basically, they viewed the agricultural sector as a
means of pumping out food and capital to promote
development in the urban-industrial area. This
was refl ected in the military government’s food-
pricing policy, which aimed to keep food prices
low to check infl ation and keep the urban working
class and middle class content. In the absence of
compensating subsidies for small farmers, this pol-
icy “served to perpetuate the long-run unfavorable
trend of the rural-urban terms of trade.” Within
the agricultural sector, the allocation of resources
and credit was skewed in favor of the already well
endowed and effi cient coastal estates producing for
export, with the bulk of agricultural investment
going into large-scale irrigation projects. The mili-
tary largely neglected the needs of highland small
farmers for small-scale irrigation works, fertilizer,
and technical assistance. As a result, the coastal
sugar, cotton, and coffee cooperatives tended to be-
come “islands of relative privilege in a sea of peas-
ant poverty and unemployment.”

412 CHAPTER 16 STORM OVER THE ANDES

The same lack of a coherent strategy for the
development of the agricultural sector as a whole
was refl ected in the method of distributing haci-
enda lands. The land was generally transferred to
the workers who had been employed full time on
the estates. They alone were eligible to be members
of the new cooperatives. This left out the tempo-
rary laborers and the neighboring peasant villag-
ers who eked out subsistence livings from tiny plots
and small herds of sheep. This often led to serious
tension and confl ict, with the cooperatives defend-
ing their privileges and land against invasions by
the comuneros (peasant villagers). This pattern of
distribution, and the failure to redistribute all the
land subject to expropriation, contributed to the
continuing fl ight of campesinos to the coastal cit-
ies, where they swelled the ranks of a large unem-
ployed or underemployed population.

Finally, a major fl aw of the agrarian reform
was that it was a “revolution from above,” with
little input from below. Despite lip service to par-
ticipatory ideology, the military technocrats made
the fi nal decisions with respect to work conditions,
income policy, crop selection, and the like. Because
the government’s economic policy tended to sub-
ordinate peasant interests to the drive for rapid
industrial growth, many peasants became disillu-
sioned with the cooperative model. In some cases,
particularly after 1975, when the nationalist re-
formist Velasco wing of the military was ousted
from power by a group stressing private enterprise
and a free market, the disillusionment led to peas-
ant demands for dismantling the cooperatives and
parceling out the land.

After land reform, the nationalization of key
foreign-owned natural resources was the most im-
portant objective of the junta’s program. The junta
also targeted domestic monopolies that the military
regarded as obstacles to development. When the
revolution began, foreign fi rms controlled the com-
manding heights of the Peruvian economy. Eight
years later, state enterprises had taken over most
of these fi rms. The process began with the nation-
alization of the IPC, whose assets passed into the
control of Petroperu, the state-owned oil company.
Later, the national telephone system, the railroads

(the Peruvian Corporation), and Peru’s interna-
tional airline came under state ownership. The mil-
itary government took over the cement, chemical,
and paper industries and also nationalized the im-
portant fi shmeal industry, in which foreigners had
invested large amounts of capital. The sugar indus-
try, in large part controlled by the Grace interests,
and the cotton industry, dominated by a U.S. fi rm,
Anderson-Clayton, were seized under the agrarian
reform law. The 1974 nationalization of the giant
U.S.-owned mining complex of Cerro de Pasco gave
the state ownership of four thousand concessions
and vested control of most copper, lead, and zinc
mining and refi ning in two state companies, Mi-
noperu and Centrominperu. Nationalization of Mar-
cona Mining in 1975 gave the state control of iron
ore and steel. In addition to the takeover of these
primarily extractive and manufacturing fi rms,
state companies obtained marketing monopolies of
all major commodity exports and most food distri-
bution. Through stock purchases, the government
nationalized most of the banking and insurance
industries. Thus, the state came to control decisive
sectors of the Peruvian economy.

The original intent of the military reformers
was not to substitute the state for local private capi-
tal but to promote its formation. The military aimed
to remove such impediments as the latifundio and
foreign monopolistic fi rms even as it tried to create
an industrial infrastructure fi nanced by mineral
and agricultural exports. But the radical rhetoric of
the nationalistic military only frightened the local
bourgeoisie, who were generally satisfi ed with their
technological and fi nancial dependence on foreign
capital, and they failed to respond to the incentives
for industrial investment. As a result, the govern-
ment itself had to assume the role of the economy’s
main investor and by 1972 accounted for more
than half the total investment in the economy.

But the cost of this investment, added to the
large sums expended for compensation for expro-
priated estates and foreign enterprises, came very
high. Tax reform offered one possibility of mobiliz-
ing considerable amounts of previously untouched
wealth. Such a move, however, would have an-
tagonized the local bourgeoisie, whom the military

MILITARY CORPORATISM AND REVOLUTION, 1968–1975 413

was wooing, and the middle class, who formed its
principal mass base. Because of disputes over ex-
propriation, Peru could not apply for loans to the
United States and the multinational agencies it
controlled. Accordingly, Peru had to turn to for-
eign private banks. Encouraged by the high price
of copper and other Peruvian exports and by the
prospect of rich oil strikes in the Amazon Basin, the
banks willingly complied with Peru’s requests for
loans. They lent $147 million in 1972 and $734
million in 1973, making Peru the largest borrower
among Third World countries in the latter year.

Although women’s rights issues clearly were
not a priority for the military regime, a new
women’s movement, led by Virginia Vargas,
founder of the Flora Tristán Peruvian Women’s
Center, nonetheless emerged. These women were
very active in grassroots neighborhood organiza-
tions, unions, teachers’ associations, and social
work agencies, which provided experience with
collective action and heightened their conscious-
ness of gender-based inequality. Under pressure
from this women’s movement, the military adopted
the eighteenth-century Inca revolutionary leaders,
Micaela Bastidas and her husband, Tupac Amaru,
as the symbols of their 1974 Plan Inca, which de-
manded civil and political equality for women, laws
against discrimination, affi rmative action in public
employment, and rural education programs.

The military likewise had not intended to un-
leash a cultural revolution, but its nationalist ide-
ology mobilized popular political participation and
reinforced artistic explorations of the country’s in-
digenous and African roots. This led to a dramatic
expansion of popular theater and folk music that
challenged criollo cultural hegemony and deci-
sively shaped a radically new multiracial Peruvian
national identity. In the early 1970s, for example,
Yuyachkani, a politically committed theater group
that took its name from a Quechua word mean-
ing “thoughts and memories,” sought to organize
indigenous workers by touring highland mining
communities and performing Fist of Copper. This
was a play that drew on Spanish and European
theatrical traditions to extol the virtues of popular
resistance to violent police repression of a miners’

strike. During postperformance discussions, the
young urban actors, who aimed to raise the con-
sciousness of their indigenous audiences, instead
learned about the long tradition of Andean indige-
nous theater, which integrated dance, music, pup-
pets, masks, and colorful costumes. These elements
were later incorporated into plays that shared with
highland peoples the “good news” about the 1969
land reform that gave them the legal authority to
fi ght for their land against the landowners and
their hired thugs. They also became very popu-
lar in the universities, urban slums, and squatter
settlements, where provincianos had migrated in
search of jobs.

By early 1975, a new cyclical crisis had begun
to ravage the capitalist world. Rising prices for oil
and imported equipment and technology, com-
bined with falling prices for Peru’s raw material ex-
ports, undermined the fragile prosperity that had
made President Velasco’s reforms possible. These
circumstances created unmanageable balance-
of-trade and debt service problems. The populist
model of development based on export expansion
and foreign borrowing had again revealed its in-
herent contradictions.

The experience of the Peruvian Revolution
shows the diffi culty of escaping from dependent
development without radical structural changes
in class and property relationships and income
distribution. Like the Mexican Revolution, Peru’s
experience suggests that the revolution that does
not advance risks stagnation and loss of whatever
gains have been made. Contemporaneous events
in Ecuador reinforced this conclusion.

ECUADOR’S MILITARY REVOLUTION

The military also played a prominent role in Ecua-
dor, the smallest of the Andean republics, which
experienced the faint beginnings of a social revolu-
tion in 1972. A group of nationalist military headed
by General Guillermo Rodríguez Lara ousted the
aging, demagogic President José María Velasco
Ibarra, who had dominated Ecuadorian politics for
the previous four decades. Velasco Ibarra had fa-
vored a dependent industrialization, shaped by the

414 CHAPTER 16 STORM OVER THE ANDES

Alliance for Progress and based on massive impor-
tation of foreign capital and goods. This program
rested on the 1964 Agrarian Reform Act, which
abolished the huasipungo, the country’s serfl ike
labor system, and expropriated church lands and
ineffi cient haciendas but also promoted coloniza-
tion of so-called tierras baldías, untitled lands that
were mostly occupied by self-suffi cient indigenous
communities. The discovery of oil in lowland terri-
tories in the late 1960s accelerated incursions into
indigenous lands and cultural autonomy, even as
petroleum production threatened the environment
by contaminating surface and underground water
supplies. By the early 1970s, foreign interests were
as dominant in Ecuador as in Peru and Bolivia; they
controlled some 35 percent of all industrial enter-
prises, nearly 60 percent of all commercial enter-
prises, and half of all banking assets in Ecuador.

Promising radical land and social reforms, the
new nationalistic military junta offered a program
of rapid economic development that stressed indus-
trialization and the modernization of agriculture.
It also promised to reverse previous offi cial policy
that surrendered the country’s rich oil resources
in the Amazonian lowlands to foreign companies.
The new government counted on revenue from oil
to fi nance the planned reforms and program of eco-
nomic development.

Five years later, however, the Ecuadorian Rev-
olution stalled. Opposition from the still-powerful
hacendado class had almost completely paralyzed
agrarian and tax reform. There was modest land
distribution to peasants, but big landowners still
controlled 80 percent of the cultivated area. The
military government virtually abandoned land
redistribution in favor of cooperation with hacen-
dados to increase production and state revenues
through mechanization, greater concentration of
land ownership, and the ouster of peasants from
the land. The result was growing peasant agitation
for true land reform, accompanied by invasions of
estates and clashes between peasants and security
forces.

Finally, under pressure from foreign oil com-
panies for lower taxes and wider profi t margins—
a pressure exerted through a boycott on oil

exports—the military regime also retreated from
its insistence on tight control over prices, profi ts,
and the volume and rate of oil production. These
concessions represented a defeat for nationalist
elements in the military junta and sharpened the
divisions within it.

In Ecuador, as in other Latin American coun-
tries under military control, the late 1970s saw a
growing popular movement for social justice and
a return to civilian rule. But unlike other countries
in the region, groups like the Indigenous People’s
Organization of Pastaza (OPIP), founded in 1979,
increasingly played an infl uential role in these
movements, joining with women’s rights activ-
ists and trade unionists. In addition to a return to
democracy, indigenous leaders demanded that the
government recognize their communal land titles,
cultural identities, and political autonomy.

Ecuador’s military leaders were aware of their
economic failures and especially their failure to
relieve the dismal poverty and social inequality
suffered by the Ecuadorian masses. According to
offi cial fi gures, wage earners’ share of national in-
come had declined from 53 percent in 1960 to less
than 46 percent in 1973. However, 7 percent of the
population received more than 50 percent of the
national income. Consequently, the military ap-
peared quite willing to abandon the burden of gov-
erning the country. In July 1978, Jaime Roldós, a
populist candidate, handily won the ensuing presi-
dential election. During the campaign, the young,
energetic Roldós promised to revive agrarian re-
form and end foreign economic control.

Central to this program was the use of large
amounts of Ecuador’s oil earnings to modernize ag-
riculture, promote industrialization, and construct
a network of roads to expand the internal mar-
ket. Roldós’s fi ve-year plan called for investment
of $800 million in rural development that would
bring some 3 million acres of coastal, highland,
and Amazonian farmland into new production.
He also aimed to accelerate the pace of agrarian
reform, targeting almost 2 million acres to be dis-
tributed to landless peasants by 1984. Roldós’s
foreign policy stressed greater independence from
the United States, refl ected in his maintenance of

COLLAPSE OF MILITARY CORPORATISM, 1975–1990 415

friendly relations with Cuba, expansion of diplo-
matic and commercial ties with socialist countries,
and support for Central American revolutionary
movements. But Roldós’s ambitious reform and
development program had hardly begun when he
was killed in a plane crash in May 1981.

His successor inherited deteriorating economic
conditions as a result of a developing recession and
declining prices for Ecuadorian oil. The economic
slump sharpened the social problems created by ad-
vances in industrialization and the modernization
of agriculture. From 1970 to 1980, the propor-
tion of peasants in the population had fallen from
68 percent to 52 percent. The agrarian reform,
stressing mechanization and concentration of
landownership rather than distribution of land to
the landless, had ended semiservile relations in the
countryside but aggravated the problem of land-
lessness and rural unemployment. This swelled
the number of rural people fl eeing to the cities in
a fruitless search for work. By the early 1980s, the
great port city of Guayaquil had a population of 1
million; an estimated two-thirds of its inhabitants
were unemployed or underemployed and lacked
adequate shelter, food, or medical care. Thus, in an
atmosphere of economic and political crisis, social
problems and tension accumulated with little pros-
pect for solutions.

Collapse of Military Corporatism,
1975–1990

THE PERUVIAN REVOLUTION
UNDER ATTACK, 1975–1983

The economic crisis that stalled Ecuador’s top-
down military revolution also provoked a sharp
struggle within Peru’s military establishment.
Radical nationalists, who proposed to extend the
1968 revolution’s social and economic reforms,
confronted moderates who called for measures
that would win the confi dence of native and for-
eign capitalists, thereby making possible a revival
of private investments. In August 1975 a peaceful
coup replaced President Velasco with Francisco

Morales Bermúdez, who gradually purged radical
nationalists from the government and forced their
resignations from the armed forces.

The so-called First Phase of the revolution
had ended. To appease foreign and domestic capi-
talists, the new government introduced a pack-
age of severe austerity measures. These included
sharp reductions in government investments in
state enterprises, steep increases in consumer
prices, and a 44 percent devaluation of the cur-
rency, only partly offset by 10 to 14 percent wage
increases. The government next announced the
end of agrarian reform, although only about one-
third of the land subject to expropriation had been
distributed. In early 1978, after long negotiations,
Morales Bermúdez capitulated to the IMF and ac-
cepted its conditions for a new loan, including
privatization of state enterprises, heavy cuts in
budgets and subsidies, large price increases, and
severe restraints on wage increases. These mea-
sures provoked widespread strikes and rioting,
which the government crushed with a full-scale
military operation.

For the thoroughly discredited military junta,
the prime concern was how to make a smooth
transfer of power to a civilian regime that would
continue its policies. A new constitution served
this function. It established a bicameral Congress,
both elected, like the president, for fi ve years. It
contained language ensuring that private property
and the free market would remain the foundations
of the Peruvian economy. The constitution guar-
anteed the right to strike and collective bargaining,
but these were subject to parliamentary regula-
tion. The biggest novelty was the grant of the right
to vote to illiterates.

Predictably, Fernando Belaúnde Terry, a mas-
ter of populist rhetoric who enjoyed an aura of
martyrdom thanks to his ouster by the military
in 1968, won the 1980 elections. It soon became
clear that he intended to continue and extend the
“counterreformation” begun by Morales Bermú-
dez. Export expansion and debt repayment were
the great priorities, to be achieved with the famil-
iar arsenal of austerity measures and devaluation,
combined with wage freezes.

416 CHAPTER 16 STORM OVER THE ANDES

The Belaúnde government also dismantled
the major reforms of the Velasco era. A principal
objective was to restore a free market in agricul-
tural land by dissolving the cooperative system. A
new agricultural promotion and development law
gave the government the power to divide coopera-
tive land into small, individual plots and turn them
over to cooperative members, who could buy, sell,
or mortgage them. This fostered the reconcentra-
tion of land in a few hands.

Other legislation empowered the government
to sell off state-owned companies and increase pri-
vate participation in publicly owned fi rms through
stock issues and other programs. The government
proposed to ban general and sympathy strikes,
drastically reduce public works spending, and
phase out subsidies on basic foods and fuel. These
proposals caused bitter wrangling in parliament
between the government and the opposition par-
ties, but they caused unprecedented popular pro-
test; for the fi rst time in Peruvian history, all the
major labor groups joined in a general strike.

Thus, fi fteen years after the military seized
power in Peru, the nation again faced a crisis of
unprecedented proportions. Its population had
doubled between 1960 and 1980, from 10 to
20 million, and its distribution between town
and country had changed dramatically. In 1960,
60 percent of the people were rural, but in 1980,
60 percent were urban. Unemployment climbed
to new heights; strikes succeeded each other in in-
dustry, the railroads, and the banks; and the rural
exodus continued to swell the population of the
barriadas that ringed Lima.

POPULAR CULTURE AND RESISTANCE

Second-generation provincianos had played a role
in many of the urban protests that helped inaugu-
rate the 1968 Peruvian revolution, and they like-
wise joined this new popular movement to defend
its achievements. Unlike their parents, however,
they had become more economically independent
of criollo society. They had created their own self-
help migrant community associations, usually
based on their region of origin (e.g., Punenos from

Puno and Ayacuchanos from Ayacucho), joined
trade unions, and participated in other grassroots
social movements that strengthened their public
embrace of indigenous identities. This growing
independence of thought and action was clearly
refl ected in the birth of a new cultural form, a pop-
ular urban musical style variously called cumbia
andina or chicha for the corn beer that was the
preferred beverage in highland Andean indigenous
communities. No longer interested in assimilating
criollo values, these sons and daughters of high-
land migrants increasingly challenged established
social hierarchies based on race, ethnicity, and
class power.

Chicha music drew on three radically dif-
ferent sources for its creative inspiration: Co-
lombian cumbia rhythms, whose origins lay in
Afro-Colombian cultural traditions; folk melodies
indigenous to the Andean highlands; and the elec-
tric instruments commonly associated with U.S.
and British rock-and-roll. Chicha songs typically
explored the everyday lives of poor, hard-work-
ing urban provincianos. According to ethnomusi-
cologist Thomas Tutino, one of the earliest chicha
bands, Los demonios del Mantaro (Mantaro Dev-
ils), sold 200,000 copies of “La Chichera,” a song
that celebrated the life of a street peddler who sold
Andean corn beer. Established criollo critics under-
standably disparaged chicha as crude, amateurish,
“mindless” music, and leftist intellectuals either
dismissed its lyrical interest in unrequited love as
politically disengaged or criticized it for “internaliz-
ing criollo values” by promoting upward mobility.

But young provincianos, often feeling un-
loved, socially marginalized, out of place, and lack-
ing a clear sense of their own identity, thrilled to
its “modern” beat and identifi ed with its lyrical la-
ment about their real-life experiences. In one very
popular song, “Ambulante Soy” (“I Am a Street
Vendor”), the lead singer of Los Shapis, perhaps
the most famous of the chicha bands, bemoaned,
“How sad is life, how sad it is to dream” and then
proudly announced, “I am a street vendor, I am a
proletarian.” Similarly, Grupo Alegría’s “Pequeño
Luchador” (“Little Fighter”) described the daily
survival struggles of “a small child / Who runs

COLLAPSE OF MILITARY CORPORATISM, 1975–1990 417

through the city / Hawking advertisements that
will sell” and then celebrated the heroism of this
“Little boy with dirty face / Little fi ghter / Your
hands now know / What it means to work.” Even
songs like Los Shapis’s “Somos Estudiantes” (“We
Are Students”), which some have criticized for its
alleged identifi cation with criollo concerns about
“occupational status” and social mobility, clearly
stressed the value of professional positions as a
means of promoting the development of their com-
munities, not their own personal self-aggrandize-
ment. “We are teachers / For our children,” Los
Shapis sang. “Doctors we will be / For the orphans.
We are lawyers / Of the poor.”

Chicha music soon outsold all its competitors
in Peruvian markets, including internationally

renowned artists like Julio Iglesias and Michael
Jackson. Initially performed on street corners and
in vacant lots in the pueblos jóvenes, chicha artists
later regularly played to large crowds in “chicha-
dromes” and provided musical entertainment at
community religious festivals, weddings, birthday
parties, and other social events. Supported by the
progressive indigenista policies of Velasco’s revolu-
tionary nationalist regime, which had made Que-
chua an offi cial national language and required
radio stations to promote authentic local music,
they soon dominated national radio broadcasts,
claiming almost 40 percent of airtime by the early
1980s. Chicha music also expanded its popularity
from the urban centers of its birth to rural highland
communities. As the reformist Velasco government

During the 1980s, migrants from highland communities adapted indigenous musical
instruments and folk rhythms to refl ect a new urban experience of modernity that
they found simultaneously exciting and disturbing. [Alison Wright/Corbis]

418 CHAPTER 16 STORM OVER THE ANDES

crumbled, chicha artists and their concerts pro-
vided young provincianos with useful meeting
places to organize popular resistance and promote
a return to democracy. Thereafter, they would
lend their voice to support reformist state social
programs proposed by Aprista and other populist
politicians who sought to curry political favor with
urban and rural provincianos alike.

APRA IN POWER, 1985–1990

The Aprista candidate who most benefi ted from
Belaúnde’s failure was thirty-six-year-old Alán
García Pérez, a disciple of the late Haya de la Torre.
García campaigned on a populist, reformist pro-
gram in 1985, promising to defend the agrarian
and industrial reforms of the Velasco era and to
reject Belaúnde’s free-market policies. In his inau-
gural address, García proclaimed that henceforth
Peru would not deal with the IMF but directly
with the creditor banks. He also announced that
he would limit interest payments on Peru’s foreign
debt of about $14 billion to 10 percent of Peru’s
export earnings—about $400 million. “Peru,”
García declared, “has one overwhelming creditor,
its own people.” Other parts of his economic pro-
gram included measures to halt capital exports,
freeze the price of necessities, and raise the mini-
mum wage by 50 percent—all measures opposed
by the IMF and the foreign fi nancial community.

García’s populist effort to restrict foreign debt
payments, prohibit the fl ight of capital, prevent
luxury imports, and raise wages formed part of a
coherent program to revive the sluggish Peruvian
economy. The long-term goal was promoting the
development of an autonomous Peruvian capital-
ism based on expanded import-substitution indus-
trialization and reduced dependence on imported
raw materials. The restriction on debt repayments
and the controls on foreign trade were designed to
make capital available for internal development;
the substantial wage increases aimed to expand
purchasing power and demand for Peruvian-made
goods. But García distinguished his populist poli-
cies from the state ownership that had character-
ized Peru’s “military socialism” in the early 1970s.

In a speech marking the anniversary of his fi rst
year in offi ce, he reassured private businessmen
that, even as he rejected devaluation and new
indebtedness as a regression to “the colonial reci-
pes of the IMF,” so he rejected nationalization. His
path, he said, led to “a strong state redirecting the
structure of Peruvian industry toward less import-
dependent options.”

But economic problems remained. Business
resistance to the price freeze produced shortages
of consumer items and forced the government to
relax price controls, allowing some prices to rise.
Moreover, there was a growing gap between the
costs of the recovery program and government
income from all sources, including export earn-
ings and the savings obtained by limiting debt
payments. García had few options. He could try
through tax reform to tap the abundant wealth
of Peruvian elites, left untouched by the military
reformers, but this was an unacceptable solution
given the moderate nature of his program. Print-
ing money or a slowdown in economic growth was
equally unacceptable. There remained the option
of going to foreign banks for loans, but García had
ruled out “new indebtedness” as a colonial recipe
of the IMF, which had in any case declared him in-
eligible for new credits.

A major obstacle to the sound, balanced
economic growth envisaged by García was the
continuing cleavage between the sierra and the
coast—the contrast between the poverty of the
highlands (largely populated by Quechua- and
Aymara-speaking indigenous peasants) and the
relative prosperity of the coast. Landlessness and
unemployment or underemployment continued
to be the burning problems of the sierra. The re-
sult was that the highlands became the scene of a
struggle between the landless peasantry and the
giant cooperatives, often controlled by elite groups
of managers, engineers, and bureaucrats.

Into this struggle over land, with all its poten-
tial for violence, entered the Maoist Sendero Lumi-
noso (Shining Path). This group was repudiated
by other left-wing movements, which viewed it as
terrorist and mistaken in its effort to polarize Pe-
ruvian society into militarists and senderistas. For

COLLAPSE OF MILITARY CORPORATISM, 1975–1990 419

the most part led by radicalized students and other
middle-class individuals, the Sendero Luminoso
emerged in May 1980 with a program of terror-
ist activity against all who supported the existing
bourgeois order; it also encouraged peasants to
invade, occupy, and loot cooperatives. The García
government responded to this threat by continuing
Belaúnde’s counterinsurgency campaign, which
had placed nineteen of Peru’s twenty-three prov-
inces under a state of emergency with the military
in overall control and suspended most civil rights.
García justifi ed this action, claiming that Sendero
Luminoso had killed thousands of offi cials, police,
members of other security forces, and uncoopera-
tive peasants. However, church authorities and
other independent observers asserted that the se-
curity forces had themselves committed many re-
pressive acts and that many killings of peasants
ascribed to Sendero guerrillas were the work of
these forces.

As his term of offi ce drew to an end, a balance
sheet of García’s record in power pointed to some
positive initiatives and accomplishments, includ-
ing his decision to limit debt interest payments to
a certain proportion of export proceeds, thereby
making more funds available for development pur-
poses. García’s debt strategy marked an advance
over that of the military reformers, but it was not
enough. Peru needed a program of structural eco-
nomic and social change. It had to create a self-
suffi cient industrial base that would lessen depen-
dency on foreign imports and capital, but it also
needed a more thoroughgoing agrarian reform
that would attack the age-old problem of Andean
poverty and backwardness. Finally, it required re-
forms that would eliminate the need for food im-
ports, expand the domestic market, and reduce the
immense inequities in income distribution.

But these changes were not made. As a result,
by 1987, García’s project for creating an autono-
mous Peruvian capitalism ran out of steam; the
country had a serious trade defi cit, its foreign re-
serves were declining, and the business class, de-
spite generous incentives from the government,
refused to increase its investments. From 1988
to 1989 the per capita gross domestic product

declined by 20 percent, the biggest decline in the
region. As if the economic crisis were not enough,
the war with the Maoist Sendero Luminoso move-
ment grew more intense. Moreover, the indigenous
struggle to reclaim ancestral lands led to a wave of
tomas de tierras (land invasions) that produced a
new militancy among peasant leaders and fueled
the rural rebellion.

Amid the economic gloom, Peru’s illicit coca
trade ironically provided the only light and cheer.
In Peru, as in Bolivia, the jobs and dollars gener-
ated by the coca boom cushioned the impact of a
devastating economic crisis. With opportunities for
employment in the legal economy shrinking, thou-
sands of migrants joined the “white gold rush” to
the Upper Huallaga Valley, the heart of Peru’s coca
empire. The coca, processed into a white paste, was
sold to Colombian dealers, who pocketed most of
the profi ts. But Peru’s share came to about $1.2
billion annually, roughly 30 percent of the value
of all Peru’s legal exports. Without these illicit dol-
lars, according to one Peruvian economist, the ex-
change rate would have nearly doubled, making
vitally needed imports much more expensive. Like
Paz in Bolivia, García liberalized Central Bank rules
to permit the purchase of coca dollars, no questions
asked.

With APRA and the military disgraced by
García’s economic fi asco and failure to end the
civil war, the 1990 presidential elections became
the site of a new contest between neoliberal free-
market philosophy and the vague electoral popu-
lism of an obscure agronomist, Alberto Fujimori.
The son of poor Japanese immigrants, Fujimori
insisted that the State’s primary obligation was to
satisfy people’s basic needs before attempting any
economic adjustment program. Surprising most
political pundits, Fujimori’s populist crusade solidi-
fi ed his base and attracted leftist support, thereby
ensuring his electoral triumph.

Clearly, the historical record of Andean mili-
tary corporatism in promoting authentic national
development was ambiguous at best. However,
even as the Andean republics had begun experi-
menting with military corporatism to solve the
postwar crisis of populism, another new strategy

420 CHAPTER 16 STORM OVER THE ANDES

of national development was unfolding in Chile.
Eschewing the violence of the Cuban revolution
and the hierarchical authority of Andean military
corporatism, Chileans opted for a broad-based,
popular, participatory, and democratic path to
development.

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• Front Cover
• Title Page
• Copyright
• Contents
• Maps
• Preface
• Introduction: The Geographic Background of Latin American History
• PART ONE: The Colonial Heritage of Latin America

1 Ancient America
Environment and Culture in Ancient America
The Maya of Central America
The Aztecs of Mexico
The Incas of Peru
2 The Hispanic Background
The Medieval Heritage of Iberia’s Christian Kingdoms
Ferdinand and Isabella: The Catholic Sovereigns
The Hapsburg Era: Triumph and Tragedy
3 The Conquest of America
The Great Voyages
The Conquest of Mexico
The Conquest of Peru
How a Handful of Spaniards Won Two Empires
The Quest for El Dorado
4 The Economic Foundations of Colonial Life
Tribute and Labor in the Spanish Colonies
The Colonial Economy
Commerce, Smuggling, and Piracy
5 State, Church, and Society
Political Institutions of the Spanish Empire
The Church in the Indies
The Structure of Class and Caste
6 Colonial Brazil
The Beginning of Colonial Brazil
Government and Church
Masters and Slaves
7 The Bourbon Reforms and Spanish America
Reform and Recovery
Colonial Culture and the Enlightenment
Creole Nationalism
Colonial Society in Transition, 1750–1810: An Overview
The Revolt of the Masses
8 The Independence of Latin America
Background of the Wars of Independence
The Liberation of South America
Mexico’s Road to Independence
Latin American Independence: A Reckoning

• PART TWO: Latin America in the Nineteenth Century

9 Decolonization and the Search for National Identities, 1821–1870
The Fruits of Independence
Mexico
Argentina
Chile
United Provinces of Central America
10 Race, Nation, and the Meaning of Freedom, 1821–1888
Brazil
Peru
Cuba
Gran Colombia
11 The Triumph of Neocolonialism and the Liberal State, 1870–1900
The New Colonialism
Mexican Politics and Economy
Argentine Politics and Economy
Chilean Politics and Economy
Brazilian Politics and Economy
Central American Politics and Economy
Venezuelan Politics and Economy
Colombian Politics and Economy

• PART THREE: Latin America Since 1900

12 Forging a New Nation: The Mexican Revolution and the Populist Challenge
The Great Revolution, 1910–1920
Reconstructing the State: Rule of the Millionaire Socialists
Cárdenas and the Populist Interlude
The Big Bourgeoisie in Power, 1940–1976: Erosion of Reform
Popular Culture and Resistance
13 Brazil: Populism and the Struggle for Democracy in a Multiracial Society
Decline and Fall of the Old Republic, 1914–1930
Vargas and the Bourgeois Revolution, 1930–1954
Reform and Reaction, 1954–1964
14 Argentina: Populism, the Military, and the Struggle for Democracy
The Export Economy
Argentine Society
The Radical Era, 1916–1930
The “Infamous Decade,” 1930–1943: Military Intervention and the State
The Perón Era, 1943–1955
Collapse of Populism: In the Shadow of Perón, 1955–1973
15 Cuba: The Revolutionary Socialist Alternative to Populism
Independence and the Spanish-Cuban- American War
Dependent Development and Popular Struggle, 1902–1953
The Revolution
The Revolution in Power, 1959–2003
16 Storm Over the Andes: Indigenous Rights and the Corporatist Military Alternative
Neocolonialism, the Military, and Indigenous Resistance
The Limits of Populism, 1952–1968
Military Corporatism and Revolution, 1968–1975
Collapse of Military Corporatism, 1975– 1990
17 Chile: The Democratic Socialist Alternative
Foreign Dependency and the Liberal Parliamentary Republic, 1891–1920
Alessandri and the Rise of Populism, 1920–1970
The Chilean Road to Socialism, 1970–1973
18 Twilight of the Tyrants: Revolution and Prolonged Popular War in Central America
Guatemala
Nicaragua
El Salvador
19 Lands of Bolívar: Military Crisis, State Repression, and Popular Democracy
Populism, Military Repression, and Authoritarian Politics in Colombia
Populism, Authoritarian Politics, and Bolivarian Revolution in Venezuela
20 Deconstructing the State: Dictatorship and Neoliberal Markets
Military Dictatorship and Neoliberalism in Brazil, 1964–1990
Military Dictatorship and Neoliberalism in Chile, 1973–1990
Military Dictatorship and Neoliberalism in Argentina, 1976–1990
Neoliberalism and the Authoritarian State in Mexico, 1977–1994
Foreign Intervention and Subversion of Democracy in Nicaragua
21 Transcending Neoliberalism: Electoral Engaños and Popular Resistance to the Dictatorship of Markets
Electoral Deception in Brazil
Electoral Deception in Argentina
Electoral Deception in Peru
Electoral Deception in Chile
Electoral Deception in Mexico
Electoral Deception in Bolivia
Electoral Deception in Ecuador
Market Forces and State Regulation in the Cuban Model, 1990–2008
22 The Two Americas: United States–Latin American Relations
U.S. Policy Objectives
Prelude to Empire, 1810–1897
An Imperial Power, 1898–1945
Defending the Empire and Capitalism, 1945–1981
The Return to “Gunboat Diplomacy,” 1981–2003
Toward a New World Order?

• Index