Guatemala and the CIA

The power of the fear of communism turned out to be a helpful aid in the economic plights of Washington. Although the threat of communistic expansion in Latin America was real, the United States Government saw another problem arising in the country of Guatemala where the United Fruit Company, a business that had been introduced into Guatemala in 1904, was having problems with the president Jacobo Arbenz Guzman in the 50s. President Arbenz saw the UNFCO as the reason why Guatemala continued to be underdeveloped, and made plans to stop the "stranglehold" that the company had over the country. The company which had strong influence in Washington was not about to let this happen, therefore the CIA organized an intricate plan to overthrow Arbenz; this plan worked.

The fruits of Guatemala play a very large role in the CIA coup in the country. The United Fruit Company's history started in 1899 when a merge between The Boston Fruit Company and an entrepreneur by the name of Minor Keith occurred. His business was railways; his dream was "to monopolize commerce in Central America by building and maintaining rail lines in areas where no other forms of transportation were available." His first railway was built in 1870 in Costa Rica; he exported bananas mostly into New Orleans and the Southern United States from 1870 till 1899 when he accepted the offer of partnership from the Boston Fruit Co. Athis peak, he was known as the "uncrowned king of Central America." (Schlesinger 66, 67)
The Boston Fruit Company had been shipping bananas from Jamaica, Cuba, and Santa Domingo since 1885 but finding that the crops were getting thin in 1898, they decided that they needed their own land to harvest. This is when they decided that Minor Keith could help expand their profits as well as his own. Together, the new corporation named the United Fruit Company obtained 212,394 acres of land which 61,263 acres were already producing bananas, along with 112 miles of railroad, "by 1930, the UFCO had operating capital of $215 million and owned sprawling properties not only in three Caribbean islands, bust also Panama, Honduras, Nicaragua, Columbia- and its largest domain, Guatemala" (Schlesinger 67).
Although extremely successful in its own right, the UFCO had some competition with a man nicknamed, "Sam the Banana Man", Samuel Zemurray. After selling arms to a Honduras leader in exile in the US (helping cause a revolution in Honduras) Zemurray gained an agreement with this leader that granted him every concession that he sought, which included protection without tax increases and permission to import building materials without paying duty. As Zemurray's company expanded, it grew too close to the UFCO's property, and so UFCO bought out Zemurray. The concessions that Zemurray gained and the concessions that UFCO already had with the railroad, were a great advantage to the company.
These concessions as well as the enormous economic control that the company held in Guatemala would become the issue that President Arbenz would try stop. Besides controlling all trade, (due to the fact that the co. owned Puerto Barrios the only export site) the company established "side deals" and obtained control over such things as the telegraph service. The company employed a large portion of the population in Guatemala as well, basically taking over the lives of all the Guatemalan people. "The company provided adequate housing, medicine, and even established a school for the employees children ( Critics liked to charge that the Guatemalan people indirectly paid for this largesse many times over through uncollected taxes on United Fruit property and exports)" (Schlesinger 71). President Arbenz wanted to free the country from it's reliance on the American company, and start setting up some new Guatemalan companies and resources.

"All the achievements of the Company were made at the expense of the impoverishment of the country and by acquisitive practices. To protect its authority it had to recourse to every method: political intervention, economic compulsion, contractual imposition, bribery [and] tendentious propaganda, as suited its purpose of domination. The United Fruit Company is the principle enemy of the progress of Guatemala, of its democracy and of every effort directed as its economic liberation." President Arbenz expresses his bitterness towards UFCO. (Schlesinger 73) Arbenz became the leader of Guatemala in 1951. His plans were to immediately take control over the country through independent development. He saw the impoverishment of his fellow countrymen as the fat cats of America growing fatter off his land and realized that there must be change. "His overriding objective was to build upon the ongoing reforms and to establish Guatemala's independence in the relation to the international political and economic structure" (Immerman 62) He worked on a new agrarian reform, which would change the lives of the Guatemalans whom were so used to working for the UNFCO. He also strongly encouraged independent activity in the economy. Arbenz's reform included ideas that would take the worker off the fields year-round and put them into industry, he decided that his farmers would produce crops other than bananas and coffee, the country side would grow foods that the people of the country could actually eat and not have to import. "By diversifying Guatemala's agricultural production and redistributing the land more efficiently, Arbenz hoped to promote a more rational economy and a unified, interdependent state" ( Immerman 64). This aggressive goal for development threatened the fruit company; and the fact that Arbenz was receiving financial support from the Communist party for his goal, gave the CIA reason to investigate and overthrow him without international or American backlash.

The "triumphant" coup in Guatemala was a long process in the making. It started first in the press with stories of "Reds" interfering in the country's politics; the press was being heavily influenced by the United Fruit Company. "The New Leader (an anti-Communist Weekly magazine) began to publish stories sympathetic to the Fruit Company's position on Guatemala. It carried numerous articles both before and after the coup, justifying intervention against Arbenz's regime on the grounds that a Soviet takeover was imminent. The stories made a vivid impression on the US liberal community, which was not well-informed about Guatemala." (Schlesinger 89) The company continued to rally support, convincing both conservative and liberals Americans that "something evil was afoot" thus winning the backing for its policies in Guatemala, as well as a great amount of influence in the government.
In the words of Nick Cullather, a CIA employee who gathered all the classified documents dealing with the coup in order to write a manual about it for the CIA, PBSUCCESS (the mission that finally overthrew Arbenz) was "an intensive paramilitary and psychological campaign to replace a popular elected government with political nonentity. In method, scale, and conception it had no antecedent and its triumph confirmed the belief of many in the Eisenhower administration that covert operations offered a safe, inexpensive substitute for armed force in resisting Communist inroads in the Third World" (Cullather 7) The CIA's motive and guise for involvement was Communism, Guatemala had received arms from Czechoslovakia in 1954, and John Foster Dulles warned the US that Guatemala could become an "outpost of Soviet Power in Latin America.. . . The CIA in collaboration with the United Fruit organized and financed an anti-Arbenz coup. In June, right wing conspirators overthrew Arbenz and installed a military government headed by the CIA's hand picked man, Carlos Castillo Armas…" (Boyer 113)
The plan was to remove Arbenz from government and recover the land that he had given to the peasants under his new agrarian policies. Thus PBFORTUNE, PBSUCCESS and the final phase PBHISTORY as they were codenamed, were made. In a press release given by the National Archives and Records Administration, the Archives explained this about the coup, "PBFORTUNE, begun during the Truman Administration, was a short-lived operation due to security leaks. PBSUCCESS initiated in August 1953, during the Eisenhower Administration, supported the coup that that resulted in the resignation of President Arbenz and the installation of Colonel Castillo Armas. The final phase of the operation, PBHISTORY, aimed at recovering documentation abandoned by President Arbenz's Administration." ("National Archives to Open CIA Guatemalan Materials") The Guatemalan overthrow was seen as the most successful CIA clandestine operation, and was to be the model of more to come if another country was "threatened" by communism.

The following accounts on the actual days of the overthrow come from author Stephen Schlesinger. As dawn broke over Guatemala City, a C-47 transport plane lumbered low in the sky, flying from the south over nearby mountains. It was still early on the morning of June 18, 1954. It swooped over the plaza facing the Palace, then swerved upward again, suddenly spewing thousands of small leaflets into the air. The printed notices in large block letters carried a bold demand: Guatemala's President, Jacobo Arbenz must resign immediately. They warned the mysterious plane would return that afternoon to blow up the city's main arsenal to assure Arbenz's swift departure. Most Guatemalan already knew enough to link the "Voice of Liberation" with the exile forces of Carlos Castillo Armas, a forty-year old former army colonel and longtime enemy of President Arbenz who had been plotting against the government from neighboring Hinduras. That night Arbenz ordered a blackout in the capital. At 11:30 in the evening, the government shut off all the lights in the streets in official buildings and at the airport. Citizens were required to extinguish lamps in their houses. A half hour later, just as Arbenz had feared, a DC-3 buzzed the city without warning, winging in from the west. It drew .30 cailiber machine gun fire from government ginners on the city's outskirts, and took some shots from larger but older Befors 20mm. guns at the city's center. Seeing no target in the darkened city, the plane passed overhead, later reportedly dropping a cache of arms by parachute near the Pacific coast. (7-16) These attacks continued through the next day, more planes flew by and bombed the city. On the second day of the attacks Arbenz decided to appeal to the nation. "Over the din, Arbenz angry and emotional, told Guatemala that 'the arch-traitor Castillo Armas' was leading a 'heterogeneous Fruit Company expeditionary force' against the country." (19) Through the last days of June Castillo Armas brought in his troops and began the take over of Guatemala. On the 25th of June, 1954, Arbenz resigned. Castillo soon took over, with much bitterness from the Guatemalan nation.

The coup was ultimately successful for the United Fruit Company and for the United States. Castillo was in power, land was returned to the Fruit Company, and knowing that Castillo was in power ensured that no Communist uprisings would spurn from Guatemala. This mission later became an example to other missions such as the Bay of Pigs in Cuba. It was seen as a well organized and perfectly hidden action by the CIA. Now after many documents have been released more is known about this mission, however, most of it has been edited and what has been removed will remain secret forever.

Cullather, Nick. Secret History: The CIA's Classified Account of its Operations

In Guatemala, 1952-1954 . Stanford: Stanford University Press, 1999

I will be using this book to help me explain what exactly the CIA's plans were for the overthrow of Guatemalan Pres. Arbenz. It is written by a CIA historian, who is no longer with the CIA, so it may give a type of bias towards the CIA, but I believe the author is still being critical in his writing. There are a couple of pictures in the book that we may be able to use for the website, a long with a PBSUCESS timeline.

Immerman, Richard H. The CIA in Guatemala: The Foreign Policy of Intervention.

Austin: University of Texas Press, 1982.

This source will help me get a better idea of the history of Guatemala and its relations with the US. There is a chapter on the coup that will give me a further explanation on what happened in '54.

Schelsinger, Stephen and Stephen Kinzer. Bitter Fruit: The Untold Story of the American

Coup in Guatemala. Garden City: Doubleday & Co, Inc., 1982.

I think this book is going to be much like the Cullather book, but with more criticism towards the CIA. It will help me get another grasp on the events, and will hopefully share more info than my other two sources.

http://www.foia.ucia.gov/scripts/popdoc.asp?docType=guat

Actual documents from and about the coup

http://www.nara.gov/nara/pressrelease/cia.html

Press release that explains the differences in the different sections of the coup

www.patriagrande.net/.../memoria.del.fuego/ 19530303.htm

The site where the picture of Arbenz came from

http://www.rose-hulman.edu/~delacova/cia-coup.htm

Site where I found picture of the rebels that is in the intro