Editing Jacobo Árbenz (section)

==Presidency==
[[File:Posesionarbenz.jpg|thumb|200px|Colonel Jacobo Árbenz Guzmán addressing the crowd at his inauguration as the President of Guatemala in 1951]]

===Inauguration and ideology===
{{See also|José Manuel Fortuny}}
In his inaugural address, Árbenz promised to convert Guatemala from "a backward country with a predominantly [[feudal]] economy into a modern capitalist state".{{sfn|Streeter|2000|p=18}} He declared that he intended to reduce dependency on foreign markets and dampen the influence of foreign corporations over Guatemalan politics.{{sfn|Fried|1983|p=52}} He said that he would modernize Guatemala's [[infrastructure]] without the aid of foreign capital.{{sfn|Gleijeses|1992|p=149}} Based on advice from the [[International Bank for Reconstruction and Development]], he set out to build more houses, ports, and roads.{{sfn|Streeter|2000|p=18}} Árbenz also set out to reform Guatemala's economic institutions; he planned to construct factories, increase mining, expand transportation infrastructure, and expand the banking system.{{sfn|Immerman|1982|p=64}} Land reform was the centerpiece of Árbenz's election campaign.{{sfn|Gleijeses|1992|p=49}}{{sfn|Handy|1994|p=84}} The revolutionary organizations that had helped put Árbenz in power kept constant pressure on him to live up to his campaign promises regarding land reform.{{sfn|Handy|1994|p=85}} Agrarian reform was one of the areas of policy which the Arévalo administration had not ventured into;{{sfn|Immerman|1982|p=64}} when Árbenz took office, only 2% of the population owned 70% of the land.{{sfn|Paterson|2009|p=304}}

Historian Jim Handy described Árbenz's economic and political ideals as "decidedly pragmatic and capitalist in temper".{{sfn|Handy|1994|p=36}} According to historian [[Stephen Schlesinger]], while Árbenz did have a few communists in lower-level positions in his administration, he "was not a dictator, he was not a [[Crypto-communism|crypto-communist]]". Schlesinger described him as a [[Democratic Socialism|democratic socialist]].{{sfn|Schlesinger|2011}} Nevertheless, some of his policies, particularly those involving agrarian reform, would be branded as "communist" by the Guatemalan upper class and the [[United Fruit Company]].{{sfn|Malkin|2011a}}{{sfn|Chomsky|1985|pp=154–160}} Historian [[Piero Gleijeses]] has argued that although Árbenz's policies were intentionally capitalist in nature, his personal views gradually shifted towards communism.{{sfn|Gleijeses|1992|p=77}}{{sfn|Gleijeses|1992|p=134}} His goal was to increase Guatemala's economic and political independence, and he believed that to do this Guatemala needed to build a strong domestic economy.{{sfn|Immerman|1982|pp=62–63}} He made an effort to reach out to the indigenous [[Mayan people]], and sent government representatives to confer with them. From this effort he learned that the Maya held strongly to their ideals of dignity and self-determination; inspired in part by this, he stated in 1951 that "If the independence and prosperity of our people were incompatible, which for certain they are not, I am sure that the great majority of Guatemalans would prefer to be a poor nation, but free, and not a rich colony, but enslaved."{{sfn|Immerman|1982|p=63}}

Although the policies of the Árbenz government were based on a moderate form of capitalism,{{sfn|Streeter|2000|pp=18–19}} the communist movement did grow stronger during his presidency, partly because Arévalo released its imprisoned leaders in 1944, and also through the strength of its teachers' union.{{sfn|Forster|2001|pp=98–99}} Although the Communist party was banned for much of the Guatemalan Revolution,{{sfn|Gleijeses|1992|pp=73–84}} the Guatemalan government welcomed large numbers of communist and socialist refugees fleeing the dictatorial governments of neighboring countries, and this influx strengthened the domestic movement.{{sfn|Forster|2001|pp=98–99}} In addition, Árbenz had personal ties to some members of the communist [[Guatemalan Party of Labour]], which was legalized during his government.{{sfn|Gleijeses|1992|pp=73–84}} The most prominent of these was [[José Manuel Fortuny]]. Fortuny played the role of friend and adviser to Árbenz through the three years of his government, from 1951 to 1954.{{sfn|Gleijeses|1992|pp=50–60}} Fortuny wrote several speeches for Árbenz, and in his role as agricultural secretary{{sfn|Ibarra|2006}} helped craft the landmark agrarian reform bill. Despite his position in Árbenz's government, however, Fortuny never became a popular figure in Guatemala, and did not have a large popular following like some other communist leaders.{{sfn|Schlesinger|Kinzer|1999|pp=55–59}} The communist party remained numerically weak, without any representation in Árbenz's cabinet of ministers.{{sfn|Schlesinger|Kinzer|1999|pp=55–59}} A handful of communists were appointed to lower-level positions in the government.{{sfn|Schlesinger|2011}} Árbenz read and admired the works of Marx, Lenin, and Stalin (before Khrushchev's report); officials in his government eulogized Stalin as a "great statesman and leader&nbsp;... whose passing is mourned by all progressive men".{{sfn|Gleijeses|1992|pp=141–181}} The Guatemalan Congress paid tribute to [[Joseph Stalin]] with a "minute of silence" when Stalin died in 1953, a fact that was remarked upon by later observers.{{sfn|Gleijeses|1992|pp=181–379}} Árbenz had several supporters among the communist members of the legislature, but they were only a small part of the government coalition.{{sfn|Schlesinger|2011}}

===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}}

===Relationship with the United Fruit Company===
{{Further|United Fruit Company}}
[[File:Central America, the West Indies South America and Portions of the United States and Mexico WDL62.png|thumb|200px|Route Map of the Great White Fleet of the [[United Fruit Company]]. The company had held the monopoly of freight and passenger maritime transportation to and from Puerto Barrios in Guatemala since 1903.]]
[[File:Guatemala railways.svg|200px|thumb|Map of railway lines in Guatemala and El Salvador. The lines were owned by the IRCA, the subsidiary of the United Fruit Company that controlled the railroad in both countries; the only Atlantic port was controlled by the Great White Fleet, also a UFC subsidiary.]]

The relationship between Árbenz and the United Fruit Company has been described by historians as a "critical turning point in US dominance in the hemisphere".{{sfn|Forster|2001|p=118}} The United Fruit Company, formed in 1899,{{sfn|Immerman|1982|pp=68–70}} had major holdings of land and railroads across Central America, which it used to support its business of exporting bananas.{{sfn|Schlesinger|Kinzer|1999|pp=65–68}} By 1930, it had been the largest landowner and employer in Guatemala for several years.{{sfn|Schlesinger|Kinzer|1999|pp=67–71}} In return for the company's support, Ubico signed a contract with it that included a 99-year lease to massive tracts of land, and exemptions from virtually all taxes.{{sfn|Immerman|1982|pp=68–72}} Ubico asked the company to pay its workers only 50 cents a day, to prevent other workers from demanding higher wages.{{sfn|Schlesinger|Kinzer|1999|pp=67–71}} The company also virtually owned [[Puerto Barrios]], Guatemala's only port to the Atlantic Ocean.{{sfn|Schlesinger|Kinzer|1999|pp=67–71}} By 1950, the company's annual profits were 65{{nbsp}}million US{{nbsp}}dollars, twice the revenue of the Guatemalan government.{{sfn|Immerman|1982|pp=73–76}}

As a result, the company was seen as an impediment to progress by the revolutionary movement after 1944.{{sfn|Immerman|1982|pp=73–76}}{{sfn|Schlesinger|Kinzer|1999|p=71}} Thanks to its position as the country's largest landowner and employer, the reforms of Arévalo's government affected the UFC more than other companies, which led to a perception by the company that it was being specifically targeted by the reforms.{{sfn|Immerman|1982|pp=75–82}} The company's labor troubles were compounded in 1952 when Árbenz passed Decree{{nbsp}}900, the agrarian reform law. Of the {{convert|550,000|acre|ha}} that the company owned, 15% were being cultivated; the rest of the land, which was idle, came under the scope of the agrarian reform law.{{sfn|Immerman|1982|pp=75–82}} Additionally, Árbenz supported a strike of UFC workers in 1951, which eventually compelled the company to rehire a number of laid-off workers.{{sfn|Forster|2001|pp=136–137}}

The United Fruit Company responded with an intensive lobbying campaign against Árbenz in the United States.{{sfn|Schlesinger|Kinzer|1999|pp=72–77}} The Guatemalan government reacted by saying that the company was the main obstacle to progress in the country. American historians observed that "to the Guatemalans it appeared that their country was being mercilessly exploited by foreign interests which took huge profits without making any contributions to the nation's welfare."{{sfn|Schlesinger|Kinzer|1999|pp=72–77}} In 1953 {{convert|200,000|acre|ha}} of uncultivated land was expropriated under Árbenz's agrarian reform law, and the company was offered compensation at the rate of 2.99 US{{nbsp}}dollars to the acre, twice what it had paid when buying the property.{{sfn|Schlesinger|Kinzer|1999|pp=72–77}} This resulted in further lobbying in Washington, particularly through Secretary of State [[John Foster Dulles]], who had close ties to the company.{{sfn|Schlesinger|Kinzer|1999|pp=72–77}} The company had begun a public relations campaign to discredit the Guatemalan government; overall, the company spent over a half-million dollars to influence both lawmakers and members of the public in the US that the Guatemalan government of Jacobo Árbenz needed to be overthrown.{{sfn|Schlesinger|Kinzer|1999|pp=90–97}}