- 19801No. 2 by Howard Handelman PERU: THE MARCH TO South America [HH-1-'801 CIVILIAN RULE' When I left Peru in July 1969-after Peru and the giant of the critical nation, and an air of political a year's residence-the nation's copper mining and refining tension, reflected the collapse of the military government had just industry), and the takeover of the Peruvian economy. Economic promulgated the most sweeping fish meal industry (controlled by the declines since 1975 had produced land reform decree in Latin America most dynamic sector of the national vast state indebtedness amounting since the Cuban evolution? The bourgeoisie). By 1975, then, the to $6 billion. Harsh austerity immediate seizure of the giant, state controlled production in Peru's measures undertaken at the behest coastal sugar plantations-owned three dominant export sectors: of the International Monetary Fund by the most powerful sector of the mining, sugar, and fish meal.3 (IMF) had intensified an ongoing Peruvian oligarchy-demonstrated deterioration of living standards the seriousness of the government's These reforms, though worrisome such that the real income of the intent. During the next five years the to United States policy-makers and urban working class declined by 40 "revolutionary" military regime, terrifying for the Peruvian economic percent between 1973 and 1978. headed by General Juan Velasco elite. received the endorsement of a The military regime, headed since Alvarado, introduced a series of large portion of the population. 1975 by General Francisco Morales programs designed to alter the Indeed, one American journal of Bermi3dez and more conservative economic and political structure of political analysis insisted in 1971 that officers, had lost all the popular Peruvian society. Urban reform laws the Velasco government had the support it once enjoyed. gave the vast population of support of the Catholic Church, squatters, on the peripheries of the much of the Marxist and Christian The causes of the collapse of Peru's nation's major cities, titles to their left, the lower middle class, most of military revolution-once hailed as a homes and the promise of more the urban poor and industrial model for political-economic change direct participation in the political working class, and the majority of in the hemisphere-are complex system. The Industrial Community peasants and plantation workers. and somewhat beyond the scope of law, loosely based on the Thus, said the author, only the this Report. Opponents on the right Yugoslavian model, sought economic elite stood squarely attribute the country's economic (unsuccessfully) to establish some against the revolutionary regime4 decline, and the concomitant form of worker self-management political crisis, to the "misguided When I returned to Peru in August and partial ownership of the means socialism" of the Velasco regime. 1978,l was greeted at the Plaza San of production. Critics on the left respond that the Martin in the heart of downtown problem was rather that the Every major sector of society - Lima by the pungent odor of tear military's "revolution" was not agrarian, urban, commercial, and gas as guardia civil (national police) radical enough-that a revolution industrial-was scheduled for dispersed government bureaucrats directed entirely from above, which serious transformation, just as all who were demonstrating against never came to grips with the sectors of the traditionally powerful the administration's announced plan problem of mass political Peruvian oligarchy were being to lay off thousands of public mobilization, and which based challenged. The agrarian reform employees. At almost the same development on loans from the program-which eventually time, teachers throughout the international banking community, destroyed the base of the landed nation were engaged in a prolonged, was doomed to fai~ure.~ elite-was followed by the industrial bitter strike and troops were reform, the expropriation of major violently dislodging striking miners The fact of the matter is that the banks, the nationalization of the who were staging a sit-in in the government had managed to Cerro de Pasco mining corporation nation's capital. The intense labor alienate Peru's industrial- (the largest foreign firm operating in unrest that was sweeping the commercial elite and foreign corporations-thereby decreasing both) decimated Peru's traditionally place. During the height of the investment from the capitalist strong export sectors, while at the Velasco regime's popularity in the sector-while at the same time same time petroleum finds were early 1970s, the President and his refusing to take the kinds of radical extremely disappointing. political strategists had toyed with measures necessary to bring about a By 1975, then, the Peruvian the idea of creating a mass party- socialist transformation. Political economy was clearly on the loosely modeled on the Mexican scientist Liisa North notes that the downslide-increases in the GNP PRI-which would include peasant, military itself was divided into failed to match population growth urban shantytown, worker, and competing factions having very and inflation reached double-digit middle-class sectors under some diverse, and generally poorly levels (common in other Latin type of control by velasquista formulated, ideologies. American nations but not in Peru (pro-Velasco, military progressives) Consequently, policy was marked until that point). At the same time, leadership. To be sure, as late as the by inconsistencies and wavering the ailing President Velasco was final year of Velasco's presidency from left to right6 In addition, the losing his grip on leadership while there was talk of creating a government suffered from the his administration became Movimiento de la Revoluci6n political incompetence, nepotism, increasingly intolerant of criticisms Peruana which would allow for the and corruption characteristic of expressed in the media or in popular permanent institutionalization of the many Latin American military demonstrations? Consequently, the military revolution through a regimes. Finally, the regime's own August 29 "internal coup," which dominant political party. Even after failings were exacerbated by a toppled Velasco Alvarado and the 1975 coup, centrist officers in a number of exogenous factors brought General Morales Bermfidez the Morales Bermudez faction which it could not control. Huge to power, was initially hailed by a shared the progressives' desire to foreign loans-largely invested in wide spectrum of Peruvian public preserve critical elements of the capital-intensive projects using opinion ranging from left to right. "military revolution" -the agrarian highly "inappropriate" During its first weeks, the newjunta reform, state control of key sectors technology-during the first years responded by freeing a number of of the economy, and so on. of the "revolution" was based on jailed labor leaders and opposition projected high sugar and copper leftists while simultaneously As the prospects of a military- dominated, mass party became prices and the anticipated extraction reducing restraints on conservative more remote, most officers were still of significant amounts of petroleum and leftist news magazines. in the eastern jungle region. The anxious that any elected Within months, however, the collapse of sugar prices after 1974, government give the armed forces government began to alienate the the decline in world demand for "due credit for its labor movement as well as its own copper, and the disastrous drop in accomplishments." Less politicized mass organizations in the the anchovy fish meal catch (due and less "idealistic" officers were countryside and urban either to previous overfishing, a equally concerned that the new shantytowns, as it began phasing shifting of the Humboldt Current, or administration not investigate too out Velasco's more radical carefully government corruption innovations. The regime's shift to during the military's reign.8 For all the right and the ongoing erosion of these reasons, then, many military living standards cost Morales men felt the best elected president Bermudez his initial support. By to succeed General Morales mid-1976, as the generals moved BermCidez would be Francisco toward their eighth anniversary in Morales Bermudez. Several power, the President and his inner "insiders" have indicated that the circle resolved that continuing original transition scenario sketched military rule was undermining the by administration officials in 1976 institutional legitimacy of the armed called for appointment of a forces and contributing to internal well-controlled commission which dissension within the officer corps. would draft a new constitution to Some means of restoring elected be submitted to the electorate for civilian government seemed in approval in 1978. Approval of that order. document, which would The Decision to Restore Civilian institutionalize and pay proper Government homage to the military's major The major decision facing the reforms in a national referendum, administration was at what rate and would be followed by a presidential in what form the transition to election in which General Morales elected government should take would stand as the candidate of a President Morales Berrniidez newly formed populist party. While such a plan may have been On August 28,1977 the government slow transition process. Holding a feasible in the heyday of the Velasco lifted the state of emergency which Constituent Assembly before, rather