1. Guatemala and Cuba

2. The United Fruit Company—a review
Disparity in Guatemala:
2% of the predominantly criollo landowning elite owned 72% of the land.
Boston based UFCO owned the rest.
Majority indigenous landless laborers suffered racial discrimination and were often indebted to plantations.
By the end of WWII:
UFCO employed 5,000 people and owned 566,000 acres making it the largest landowner and employer in the country.
UFCO subsidiary, the International Railway of Central America, also employed 5,000 and owned 96% of Guatemala’s track.
UFCO controlled the docks and merchant fleet.

3. Leadership
In 1944, a middle class movement led by students and young army officers lead to the overthrown of Ubico, the US supported dictator.
Juan Jose Arevalo elected president in free and fair elections.
Arevalo’s goals:
End disparity
Provide social services
Law of Forced Rental—uncultivated lands had to be leased to peasants at inexpensive rates.
How does the US respond?
Housing laws and 8% wage increase earned by communist supported labor unions confirm US suspicions of communism.
New literacy program seen as indoctrination

4. US Response
CIA plans for intervention halted by Truman over concerns by the State Department about violating OAS.
OAS—Organization of American States was formed in 1948 to promote hemispheric solidarity and equal treatment of all American states, regardless of size or international status.

5. Jacobo Arbenz Arbenz won the 1950 election with 65% of the vote.
Objectives from inaugural speech:
Economic independence
Establishment of modern capitalist state
Increase standard of living
Key=land reform
Decree 900 enacted in June 1952
Allowed gov. to expropriate uncultivated lands from larger plantations. Landowners compensated through 25-year bonds with 3% interest on the value of the land determined by taxable work of the land as of May 1952.
After June 1952, 1.5 million acres were distributed to 100, 000 families; including 1,700 acres owned by Arbenz himself.

6. UFCO and the US Gov.
85% of UFCO land was uncultivated so much of the expropriated land was owned by the company.
Based on official tax value of the land, the gov. offered UFCO $627, 572.
But, over the years UFCO had deliberately undervalued it’s land to avoid paying taxes and now complained to the US gov.
US State Department countered for $15, 854, 849.
UFCO was a US company, but John Foster Dulles worked for the law firm that represented it and Allan Dulles was president of the UFCO board.

7. Domino Theory—Guatemala seen as test case
Despite accusations of communism Arbenz continues land reform and refuses to oust 4 communists in a legislature of 56.
US appeals to OAS, hoping for collective action.
Measure passed by no direct OAS intervention and US could not act alone to force policy change.
US resorts to embargos and covert operations.
Refusal to sell military equipment to Guatemala forced a fearful Arbenz to approach eastern Europe for military support.
Arms shipment form Czechoslovakia on May gave the US pretext in support of communist claims.

8. Overthrowing Arbenz
US assisted exiled Colonel Carlos Castillo Armas in leading a group of exiles in an armed insurrection.
June Castillo and an army of 150 crossed from Honduras to Guatemala assisted by CIA operatives.
CIA provided new reports from the jungles that over reported the strength of the opposition to Arbenz
US pilots strafed the capital, creating the image of a city under siege but causing minimal damage.
The army refused to support the government.
Arbenz forced to resign and go in to exile.

9. Guatemala and Cuba
Compare and contrast US treatment of Guatemala with US treatment of Cuba. Why the similarities and differences?
State Department stance on violating OAS.
Success of overthrowing Arbenz vs failure at the Bay of Pigs.
Eisenhower vs. Kennedy
How does the Cuban Missile Crisis shift superpower relationships?
US, USSR, and China