Editing Jacobo Árbenz (section)

===Land reform===
[[File:Quetzaltenango farm highlands 2009.jpg|thumb|right|Farmland in the [[Quetzaltenango Department]], in western Guatemala]]
{{Main|Decree 900}}
The biggest component of Árbenz's project of modernization was his agrarian reform bill.{{sfn|Immerman|1982|pp=64–67}} Árbenz drafted the bill himself with the help of advisers that included some leaders of the communist party as well as non-communist economists.{{sfn|Gleijeses|1992|pp=144–146}} He also sought advice from numerous economists from across Latin America.{{sfn|Immerman|1982|pp=64–67}} The bill was passed by the National Assembly on 17 June 1952, and the program went into effect immediately. It transferred uncultivated land from large landowners to their poverty-stricken laborers, who would then be able to begin a viable farm of their own.{{sfn|Immerman|1982|pp=64–67}} Árbenz was also motivated to pass the bill because he needed to generate capital for his public infrastructure projects within the country. At the behest of the United States, the [[World Bank]] had refused to grant Guatemala a loan in 1951, which made the shortage of capital more acute.{{sfn|Gleijeses|1992|pp=149–164}}

The official title of the agrarian reform bill was [[Decree 900]]. It expropriated all uncultivated land from landholdings that were larger than {{convert|673|acre|ha}}. If the estates were between {{convert|672|acre|ha}} and {{convert|224|acre|ha}} in size, uncultivated land was expropriated only if less than two-thirds of it was in use.{{sfn|Gleijeses|1992|pp=149–164}} The owners were compensated with government bonds, the value of which was equal to that of the land expropriated. The value of the land itself was the value that the owners had declared in their tax returns in 1952.{{sfn|Gleijeses|1992|pp=149–164}} The redistribution was organized by local committees that included representatives from the landowners, the laborers, and the government.{{sfn|Gleijeses|1992|pp=149–164}} Of the nearly 350,000 private land-holdings, only 1,710 were affected by expropriation. The law itself was cast in a moderate capitalist framework; however, it was implemented with great speed, which resulted in occasional arbitrary land seizures. There was also some violence, directed at landowners as well as at peasants who had minor landholdings of their own.{{sfn|Gleijeses|1992|pp=149–164}} Árbenz himself, a landowner through his wife, gave up {{convert|1700|acre|km2|0}} of his own land in the land reform program.{{sfn|Smith|2000|p=135}}

By June 1954, 1.4&nbsp;million acres of land had been expropriated and distributed. Approximately 500,000 individuals, or one-sixth of the population, had received land by this point.{{sfn|Gleijeses|1992|pp=149–164}} The decree also included provision of financial credit to the people who received the land. The National Agrarian Bank (''Banco Nacional Agrario'', or BNA) was created on 7 July 1953, and by June 1951 it had disbursed more than $9{{nbsp}}million in small loans. 53,829 applicants received an average of 225{{nbsp}}US dollars, which was twice as much as the Guatemalan per capita income.{{sfn|Gleijeses|1992|pp=149–164}} The BNA developed a reputation for being a highly efficient government bureaucracy, and the United States government, Árbenz's biggest detractor, did not have anything negative to say about it.{{sfn|Gleijeses|1992|pp=149–164}} The loans had a high repayment rate, and of the $3,371,185 handed out between March and November 1953, $3,049,092 had been repaid by June 1954.{{sfn|Gleijeses|1992|pp=149–164}} The law also included provisions for nationalization of roads that passed through redistributed land, which greatly increased the connectivity of rural communities.{{sfn|Gleijeses|1992|pp=149–164}}

Contrary to the predictions made by detractors of the government, the law resulted in a slight increase in Guatemalan agricultural productivity, and to an increase in cultivated area. Purchases of farm machinery also increased.{{sfn|Gleijeses|1992|pp=149–164}} Overall, the law resulted in a significant improvement in living standards for many thousands of farmer families, the majority of whom were [[Indigenous peoples of the Americas#Guatemala|indigenous people]].{{sfn|Gleijeses|1992|pp=149–164}} Gleijeses stated that the injustices corrected by the law were far greater than the injustice of the relatively few arbitrary land seizures.{{sfn|Gleijeses|1992|pp=149–164}} Historian [[Greg Grandin]] stated that the law was flawed in many respects; among other things, it was too cautious and deferential to the planters, and it created communal divisions among farmers. Nonetheless, it represented a fundamental power shift in favor of those that had been marginalized before then.{{sfn|Grandin|2000|pp=200–201}} In 1953 the reform was ruled unconstitutional by the Supreme Court, but the Guatemalan Congress later impeached four judges associated with the ruling.{{sfn|Gleijeses|1992|pp=155, 163}}