Common Prosperity Redux: Socialism “with Chinese Characteristics” Xi-Style

Posted on by E Curb Nottus
Commerce & Business, Economic policy, Economics and society,, International Relations
Deng prosperity (Wikiwand)

The latest buzz phrases in economic policy in PRC under Xi Jinping are “common prosperity” and “dual circulation” (see Postscript). Actually, common prosperity (Gongtong fuyu) is not new at all to communist China, there has had two previous iterations, the expression originating with Chairman Mao as far back as 1953. Then in the late 1970s leader Deng Xiaoping co-opted the term, flipping it to help spearhead an economic reorientation from the ideologically adherent socialism of Mao to an opening towards market capitalism and private enterprise. Deng proposed a different route to common prosperity, one that allowed some peasants to get rich, which would provide the catalyst to drag the others towards the stated objective.

(Source: addicted2success.com)

First generation billionaires and millionaires; social cohesion imperilled
Beijing tell us the purpose of the Xi-led common prosperity initiative is to reverse the growing trend of the wealth gap which has dramatically increased since Deng’s day. China’s rapid economic growth made it possible to lift millions of Chinese out of poverty, but has also led to a situation where the top 1% holding 30.6% of the country’s wealth. Estimates put the number of Chinese (USD) billionaires as high as 1.1 million (second to the US) (East Asia Forum 20-Sep-2021)⁼ᵃ⁼. According to Elizabeth Economy, China’s Gini coefficient ranks it in the camp of the world’s most unequal states (quoted in Andrew Collier, ’China’s ‘Common Prosperity Campaign Is Going to Be Tough’, The Diplomat, 18-Sep-2021, www.thediplomat.com). Many middle class Chinese citizens are flaunting thbeir nouvelles richesses with luxury acquisitions, which doesn’t go unnoticed by those lower down the socio-economic strata.

Xi in Mao’s shadow? (Photo: denverpost.com)

A pivot to the left?
The Asia Society’s Kevin Rudd described common prosperity as a strategy to re-establish the prominence of the state and the party over the market. Many China-watchers don’t necessarily attribute the new move by the Xi government to the communist party having suddenly rediscovered its 1949 socialist roots. With the situation calling for change, Xi is acting also with an eye to bolstering up his leadership and legitimacy to secure a third term as president next year.

Jack Ma (Source: las2orillas.co)

Cracking down on Alibaba and Tencent
Xi and the party looked round for targets, pressure has been exerted on China’s high profile business elite, mega-billionaires such as Jack Ma and Pony Ma. In genuflect-like fashion their respective companies Alibaba and Tencent quickly came forward to pledge billions of dollars to charities (‘Chinese tech giants pledge billions to support President Xi Jinping’s ‘ common prosperity goal’, Dong Xing, ABC News, 07-Sep-2021, www.abc.net.au). Others to find themselves in the cross-hairs of the new reform agenda include private tutoring, online gaming and the entertainment industry. Critics say that leaning on big tech companies and taxing high and ‘unreasonable’ incomes won’t fix China’s structural inequality in income. What is required is a fundamental change in tax structure and state system which addresses the core problem of a lack of tax revenue. China’s share of revenue is 28.% of GDP cf. 40.3% for OECD countries, its personal income taxes loiter at just 1.2% of GDP cf. the OECD’s 8.2%. PRC’s “Achilles Heel” in tax is the paucity of its compliance, the present system results in a low number of personal tax payers in China relative to workforce size (Collier).

(Source: Brunswick Group)

No “Robin Hood” scenario at work
The Chinese government has moved quickly to reassure concerned business heavyweights (and international investors) about its motives…senior economic official Han Wenxiu’s pitch: common prosperity was “not about killing the rich to help the poor”, rather, he said, it is geared to “doing a proper job of expanding the pie and dividing the pie” (‘Assessing China’s “common prosperity” campaign’, Ryan Haas, Brookings, 09-Sep-2021, www.brookings.edu).

The outcome of such a transformation as the reforms may bring about, some fear may be a “top down Utopian China” with, as K Rudd suggested earlier, even more power and control devolving to the party (‘Changing China: How Xi’s ‘common prosperity’ may impact the world’, Kaishma Vaswani, BBC News, 07-Oct-2021, www.bbc.com).

Little appetite for property and inheritance taxes
One source of redistributing wealth on a national level is taxation on property and inheritance (and a more progressive income tax). But there appears little enthusiasm to upturn this apple cart as it steps uncomfortably on the toes of communist party elites and their vested interests (Haas).

Image: radiichina.com

Endnote: Millennial “have-nots“, in dire need of a share of the common prosperity
The effects of the free market’s dislocation of Chinese society in the early 21st century falls heaviest on the young. Young Chinese face enormous pressures on the highly competitive road to success, starting with the pressure cooker of trying to excel in the gaokao (higher education entrance exam). Even with tertiary qualifications under their belt, so many find themselves chasing the same plum jobs. with nine million-a-year university graduates, with the exception of a fortunate few “a whole generation” miss out on the Chinese good life promised by the capitalist success story (‘China’s ‘common prosperity’ goal won’t mean Robin Hood style redistribution’, Andrew Leung, South China Morning Post, 23–Sep-2021, www.scmp.com). Signs of growing millennial dissatisfaction with the uber-demanding drudgery of the “996”⁼ᵇ⁼ work culture in large Chinese companies manifest themselves—largely via Weibo the Chinese social media network—in the “lying flat” movement (píng tâng) … more twenty-somethings and thirty-somethings opting to drop-out of the competitive rat race, thus earning the state‘s opprobrium (‘The buzzwords reflecting the frustration of China’s young generation’, Fan Wang & Yitsing Wang, BBC, 14-Jun-2021, www.bbc.com). Then there’s the elusive dream of home ownership, wealthy property investors and speculators have pushed the cost of owning a home out of the reach of many millennials…squeezed out of the property market, feeling burn-out from “996”, more young Chinese are forgoing (or at least postponing) starting a family.

(Photo.thestar.com.my)

Postscript: A new economic model to narrow the income gap
“Dual circulation” dovetails neatly into the objective of common prosperity. Beijing has signalled its intent to re-gig the economic model, moving away from over-dependence on exports and capital investment favouring large enterprises, and tapping into the potential of its huge domestic market. This could lead to a refocus on services, domestic consumption and the environment, and a reliance on “indigenous innovation to fuel growth” (Leung; ‘What is China’s dual circulation economic strategy and why is it important?’, Frank Tang, South China Morning Post, 19-Nov-2020, www.scmp.com).

𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪 𝄪
⁼ᵃ⁼ conversely some 600 million workers live on the equivalent of US$154 or less a month (East Asia Forum)

⁼ᵇ⁼ 9am to 9pm, 6 days a week

Gowings on George and Market…Going, Going, Gone

Posted on by E Curb Nottus
Commerce & Business, Economics and society,, Local history

Gowings menswear store was an retail institution in Sydney’s CBD for six score and then some years. This mid city store was the place you could find—in addition to its main line of affordable casual men’s clothing and apparel—among other things outdoor camping equipment, cricket kits, school uniforms and novelty items. Gowings also had a barber’s shop and you could hire a Year 12 formal suit or a wedding tux.

The Gowings story starts with John Ellis Symonds (JES) Gowings who emigrated to New South Wales from England in 1857. After retail experience in David Jones’ Sydney department store—where he worked his way up to head of mercery—JES’s first venture of his own was to open a drapery shop in 1863 in Crown Street, East Sydney. He then formed a partnership with his brother Preston, in 1868 the brothers opened a Mercery and Glove Depot at 318 George Street. JES managed the store in return for £200 per annum and 50% of the profits. The iconic Sydney retailer was up and running.

The business grew, in 1870 a new mercery warehouse was opened in Edinburgh House, 344 George Street, and 20 years later a second city store at 498 George Street. The brothers’ younger sibling Charles was hired as the Gowings store’s “dog walloper”, his job was chasing dogs away from the store as a preventive measure so they didn’t foul the pavement (Kingston).

Over time the Gowings retailer evolved from specialising in ladies’ gloves and silk umbrellas to menswear, turning itself into high-class gentlemen’s outfitters. JES’ customer-centric retail philosophy involved listening to the customers, treating them like they were friends and securing the best quality goods for them (Kingston). The 1890s and the approach of Federation prompted Gowings, anticipating the modern “Buy Australian” campaign, to push the Australian product. Restyling themselves as “Austral Clothiers, Mercer’s, Hatters”, Gowings Bros launched the slogan “Australian wool for Australian people”. For the country customers Gowings offered Australian manufactured commodities via its mail order service, eg, Marrickville Tweeds from John Vicars & Co, ‘bosker’ rugs made especially for Gowings (Kingston).

After JES’ death in 1908 control of Gowings passed to the John and Preston’s sons, with the firm’s tradition for quality goods continuing. The construction of a new flagship building in 1929 on the George Street site became a landmark for Sydney (at the time it was Sydney’s highest building and the first steel construction in the CBD)✦.

A testimony to Gowings’ fame is the cult phrase that it acquired (and cultivated by the retailer) during the 20th century …”Gone to Gowings” has passed into the Australian vernacular, meaning a failure of some kind or other, or possibly a state of inebriation or dementia (Tréguer). Macquarie Dictionary lists six definitions: 1. Deteriorating financially, 2. illness especially a hangover, 3. Failing dismally (a racehorse, a football team, etc), 4. having departed hastily or without a specific destination in mind, 5. drunk, 6. Insane, idiotic. Alternately it could mean down on your luck, lost at the races, etc. The other famous catchphrase that was posted on the flagship premises” facade was “Walk Thru, No one Asked to Buy”.

The Gowings family maintained a steady as it goes, minimise risk approach to the retail business for most of its history. Attempts to modernise it’s main store came later (installing air conditioning and music in lifts, the first retailer in Sydney to do so). Another innovation was its introduction of the “Gowings Own Brand” label of merchandise.

Gowings’ CBD stores (it added a second city store at Wynyard in 1996 – nicknamed the “Blokeatorium”) retained their popularity with the public, however a move to the suburbs (Oxford Street, Darlinghurst and Hornsby) proved less successful. In 2000 the Gowings family relinquished control of the retail business to an independent listed company G Retail and concentrated on the property development game.

Gowings ad, 1909

Gowings end-game
Under G Retail a new suburban outlet at Parramatta opened in 2002 proved a disaster, and when G Retail lost money three years in a row, the writing was on the board for the veteran retailer. More financial strife followed overreach (an aggressive expansion and building renovation program), G Retail was heavily in debt and headed for administration. In the early 2000s, Gowings, like most small retailers, struggled. A hike in the petrol price in Sydney in 2005 depressed consumer spending, exacerbating its problems (Evans; Perinotto). In recent years Gowings tried to innovate, going online, discounting, etc, but the decline was irreversible by then. Competition from the city’s retail giants was too great, Gowings simply couldn’t match the depth and breadth of range and quality that big merchants such as Target could offer (Lake)◈. The Oxford Street and Hornsby stores closed in 2005 and the following January the flagship George Street store closed its doors for good after 137 years of retailing. Later that year the Wynyard store completed the round of closures.

Compared to the larger, more dynamic players in the market, Gowings had the reputation of being a “blokey store”, leading some observers to pinpoint its ultimate demise in its retail conservatism, “stay(ing) locked in the fifties or sixties and limited (in its) geography” (Lake)

The post-Gowings space
Three months after its closure the Gowings landmark building at 452 George Street was snapped up by the Rydge family’s Amalgamated Holdings goliath for $68.6 million, consolidating its property holdings in this mid-town spot — Amalgamated Holdings had previously acquired the State Theatre building next door (49-51 Market St) as well as the nearby Mick Simmons building.

Footnote: in the late Nineties Gowings wholeheartedly embraced the ‘blokey’ image, its then MD and descendent of the founder proclaimed Gowings “the complete bloke’s outfitters”. Along with its usual clothing lines, it began pitching the “Bear Grylls” experience to men, selling goods for the great outdoor adventure (camping gear, hunting knives, zippo lighters) (Owens).

Gowings bldg (2021)

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✦ designed by architect Crawford H Mackellar and incorporating a Palazzo style
◈ Retail expert Rob Lake attributes the fact that Gowings survived longer than many of the other ‘dinosaurs’ to its evolution into a sort of quaint relic which became its “point of difference” but one that didn’t boost it’s sales (Lake)

✑ ✑ ✑

Works and articles consulted:
Beverley Kingston, ‘Gowing, John Ellis Symonds (1835–1908)’, Australian Dictionary of Biography, National Centre of Biography, Australian National University, https://adb.anu.edu.au/biography/gowing-john-ellis-symonds-12945/text23395, published first in hardcopy 2005, accessed online 26 April 2021.
‘”gone to Gowings”: meaning and origin of this Australian phrase’, (Pascal Tréguer), Word Histories, 2020, www.wordhistories.net
‘End of an era as Gowings finally gone’, Sydney Morning Herald, 28-Jan-2006, www.smh.com.au
‘Gowings makes it like a man’s, (Susan Owens), Australian Financial Review, 25-Sep-1999, www.afr.com
‘The sad demise of a quirky retail dinosaur’, (Rob Lake), Crikey, 08-Nov-2005, www.crikey.com.au
‘Gowings clearing out for good after 137 years’, (Michael Evans), Sydney Morning Herald, 17-Dec-2005, www.smh.com.au
‘Gowings building sold to neighbour for $69m’, (Tina Perinotto), Australian Financial Review, 28-Apr-2006, www.afr.com

United Fruit, CIA, Do Business in Guatemala, Cold War Style: 3) Precursor to Civil War and an Export Model for Anti-Communists a

Posted on by E Curb Nottus
Comparative politics, Economics and society,, International Relations, Politics, Regional History

A fortnight after Jacobo Árbenz Guzman fell on his sword, resigning the presidency of Guatemala, Colonel Carlos Castillo Armas, who had led the so-called “Army of Liberation”—the US-financed and trained rebel force which had invaded the country—was made president of Guatemala’s ruling military junta. Despite Washington’s professed intention to rebuild Guatemala through comprehensive reforms into a “showcase for democracy”, the US’s ongoing preoccupation with the drive to eliminate communism in the region took precedence [Brockett, Charles D. “An Illusion of Omnipotence: U.S. Policy toward Guatemala, 1954-1960.” Latin American Politics and Society, vol. 44, no. 1, 2002, pp. 91–126. JSTOR, www.jstor.org/stable/3177112. Accessed 4 Aug. 2020].

Árbenz’s resignation speech ⍗

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Doubling down on communism
America’s ‘Liberator’ for Guatemala however took a blanket approach to the communist witch hunt, his repressive crackdown targeted anyone suspected of opposing his increasingly dictatorial regime. Political opponents, labour leaders, remnants of the Árbenzista peasantry, were all rounded up (over 3,000 were arrested by Castillo Armas and an unknown number liquidated). Non-communists were routinely caught up in the purge, including ordinary farm workers from local agrarian committees. Árbenz’s agrarian land reform system was dismantled, the land appropriated from United Fruit Company (UFCo) was returned to it. Resistance to Castillo Armas’s removal of peasants from their lands acquired during the revolution was met with repression by the regime. Castillo Armas also had to deal with insurrections by disaffected left-wing Ladino officers (remnants of the military remaining loyal to Árbenz and Areválo), fighting a guerrilla insurgency from the highlands (Brockett).

Árbenz and his supporters spent 73 days in asylum in the Mexican Embassy before an inglorious exile  ⍗

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Armas’ presidency, which ended in 1957 when he was assassinated by an Árbenz sympathiser, was a disaster for a recovering Guatemala. The fallout from the Armas regime’s soaring debts and entrenched corruption was that it became almost completely dependent on US aid. The deteriorating situation under Ydígoras (the new president) led him to declare a “state of seize” in 1960, suspending civil liberties and establishing military rule. An attempt by a group of dissident military officers to overturn Ydígoras’ increasingly oppressive government triggered a civil war in Guatemala which lasted 34 years and claimed the lives of approximately 200,000 civilians, including a genocidal “scorched earth” policy conducted against the indigenous Q’eqchi Maya community [‘Foreign Relations of the United States, 1958-1960, American Republics, Volume V’, Office of the Historian, www.history.state.gov/]

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⍐ the Guatemalan junta post-democracy 

“Guatemala as domino” – a blueprint for coups in Latin America and the Caribbean
Post-1954 the US continued to provide Guatemalan security forces with “a steady supply of equipment, training and finance, even as political repression grew ferocious”. The type of practices rehearsed in Guatemala—covert destabilisation operations, death squad killings by professional intelligence agencies—were lessons learnt for dealing with future ‘maverick’ regimes trying to chart a different political and economic path to that acceptable to Washington [Greg Grandin, The Last Colonial Massacre: Latin America in the Cold War, (2011)].

The most tragic and wide-reaching legacy of the 1954 Guatemala coup is that it provided a model for future coups and instability in the region set off by a heightened Cold War. The US followed the Guatemala playbook in orchestrating the Bay of Pigs invasion of Cuba by reactionary exiles in 1961 – albeit with a very different outcome. The US’ toppling, with British complicity, of the democratically elected Jagan government in British Guiana in 1964 had familiar reverberations to 1954: Washington’s fear of confronting a communist government in the hemisphere after the Cuban Revolution resulted in “an inflexible and irrational policy of covert subversion towards a moderate PPP government” in British Guiana [Stephen Rabe, U.S. Intervention in British Guiana: A Cold War Story, (2005)]. The CIA and right-wing dissidents within the Brazilian military colluded in a coup which overthrew the liberal government of João Goulart in 1964 (golpe de 64), replacing it with an uncompromising military junta. Washington’s involvement was prompted by Goulart’s plans to nationalise the Brazilian oil industry and other large private businesses. The same techniques and rhetoric were employed in the Dominican Republic coup/counter-coup in 1965. Most notoriously the Guatemalan putsch was to have echoes in the 1973 coup d’état in Chile which violently removed Marxist president, Salvador Allende. This was in response to Allende’s move to nationalise foreign businesses including US-owned copper mines and telecommunications giant I.T.T. US president, Richard Nixon, in fact had already tried to prevent Allende from taking office after the socialist won the Chilean elections fair and square in 1970❅ [‘Chilean president Salvador Allende dies in coup’, History, www.history.com/].

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⍐ CIA headquarters in Virginia, USA

CIA hit-list for Guatemala
CIA documents declassified in the 1990s reveals lists were compiled as early as 1952 of individuals in the Árbenz government “to (be) eliminated immediately in event of (a) successful anti-Communist coup”. Because the names were deleted during the agency declassification it can’t be verified if any of the assassinations were actually carried through [‘CIA and Assassination: The Guatemala 1954 Documents’, (Edited by Kate Doyle & Peter Kornbluh), The National Security Archive, www.nsarchive2.gwu.edu].

Footnote: the removal of Árbenz from Guatemala didn’t mean the CIA and Washington were done with the deposed president. The CIA continued its campaign to trash the reputation of Árbenz in exile, even though, personally, he was a politically impotent figure by this time. The CIA found it useful to continue to smear Árbenz as a “Soviet agent”, tying him to the ongoing US crusade against communism in the hemisphere✪ [Ferreira, Roberto Garcia. “THE CIA AND JACOBO ARBENZ: HISTORY OF A DISINFORMATION CAMPAIGN.” Journal of Third World Studies, vol. 25, no. 2, 2008, pp. 59–81. JSTOR, www.jstor.og/stable/45194479. Accessed 6 Aug. 2020].

Nixon and Armas ⍗

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PostScript: A mea culpa of sorts
Decades later the US government through President Clinton issued an apology, not for the 1954 coup, but for the US’ role in the human rights abuses of the civil war in Guatemala, which slaughtered thousands of civilians. It wasn’t until 2011 that the Guatemalan government (under President Colom) apologised for the “historic crime” against Árbenz and his family [‘Apology reignites conversation about ousted Guatemalan leader’, (Mariano Castillo), CNN, 24-Oct-2011, www.edition.cnn.com; ‘Clinton apology to Guatemala’, (Martin Kettle & Jeremy Lennard), The Guardian, 11-Mar-1999, www.theguardian.com].

▂ ▁ ▂ ▁ ▁ ▂ ▁ ▂ ▁ ▂ ▁ ▂ ▁ ▂ ▁ ▂ ▁ ▂

❅ US I.T.T. (International Telephone and Telegraph Corporation) entreated the Nixon administration to wage “economic warfare” and take other covert measures against the Allende regime to ensure its ouster from power, ‘Papers Show I.T.T. Urged U.S. to Help Oust Allende’, New York Times, 03-Jul-1972, www.nytimes.com

✪ back in Guatemala, President Armas and the latifundios (rich conservative landowners opposed to the Árbenz agrarian policy) provided a in-synch chorus, echoing the US charges of communist collusion by Árbenz

 

United Fruit, CIA, Do Business with Guatemala, Cold War Style: 2) Democracy to Coup D’état

Posted on by E Curb Nottus
Comparative politics, Economics and society,, International Relations, Military history, Political geography, Regional History

CCACBF24-9484-466C-AD4D-9150E57E5250With the go-ahead from incoming president Eisenhower in March 1953, Allen Dulles and the CIA continued the covert plot to undermine and destabilise the Árbenz government. The highly-orchestrated assault on the Árbenz regime took place on several fronts. Washington blocked a much needed loan from the World Bank to Guatemala and imposed an arms embargo on the country❈. The CIA forged an alliance of neighbouring states which were hostile or potentially hostile to Árbenz. The dictators running Nicaragua, Honduras, El Salvador, Dominican Republic and Venezuela didn’t require much persuading. Success by Árbenz in redistributing Guatemalan land could easily inspire the peasantries in their own countries to make similar demands, so the tiranos-caudillos were only too happy to get on-board with the CIA’s mission and pass on valuable intelligence about Guatemala to the US, and in the case of Nicaragua’s Somoza, Dominican Republic’s Trujillo and Venezuela’s Jiménez, help finance and arm the anti-Árbenz rebels.

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⬆️ Dulles Bros Inc

Within the turbulent atmosphere of Guatemala CIA pursued a strategy of divide-and-rule. The US dangled the carrot of future armaments before the country’s military high command –  the arms withheld from them would be made available on the proviso that they were prepared to break with their loyalty to Árbenz. [Bowen, Gordon L. “U.S. Foreign Policy toward Radical Change: Covert Operations in Guatemala, 1950-1954.” Latin American Perspectives 10, no. 1 (1983): 88-102. Accessed July 28, 2020. www.jstor.org/stable/2633365].

Peurifoy and anti-communism in one country
At the same time the US State Department also utilised diplomatic channels to lever pressure on the Guatemalan regime. The State Department purposefully chose John Peurifoy as the new ambassador to Nicaragua. Peurifoy came with the right credentials to ‘help’ in Guatemala. As US ambassador to Greece in 1950 he interfered in post-civil war Greece to consolidate an anti-communist climate in the country. As Washington’s man-on-the-ground in Guatemala Peurifoy played a key role in destabilising the Árbenz government. The ambassador  approached the task of rooting out communists in Guatemalan politics very zealously, describing a meeting with Àrbenz thus, “I came away definitely convinced that if President is not a communist, he will certainly do until one comes along, and that normal approaches will not work in Guatemala” [‘The Ambassador in Guatemala (Peurifoy) to the Department of State, Office of the Historian, www.history.state.com/]⧆. The CIA’s anti-Árbenz propaganda campaign also secured the assistance of the Catholic Church in Guatemala, whose priests infused their sermons with censure of the government.

Washington parachutes ”anti-red troubleshooter” into Guatemala
(New York Times) ⬇️


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Self-appointed gatekeeper of the Western Hemisphere
Historians have debated the reasons for Washington’s persistently determined pursuit of the Guatemalan democracy. In the early to mid-Fifties the mania of anti-communism was at its peak in America. Eisenhower had been elected in 1952 pledging to stop the spread of the “communist scourge” both at home and globally⌑. In such a charged climate the US Administration found itself very disposed towards seeing developments in Guatemala under Árbenz as evidence of a Soviet beachhead in the region, as a violation of the Monroe Doctrine◰, and therefore justification for Washington to intervene in Guatemala’s affairs [‘Upholding the Monroe Doctrine: American Foreign Policy in the 1954 Guatemalan Coup d’Etat’, (Nadjalisse C. Reynolds-Lallement), [Dr. Karen E. Hoppes HST 201: US History June 5, 2013], http://pdxscholar.library.pdx.edu/].

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A symbiosis of political and economic interests?
The consensus among historians is that Cold War politics was the prime mover for the US, and that the economic interests and profitability of United Fruit Company (UFCo) in Guatemala always was secondary in the scheming – although as Gordon has argued, there was a reciprocal relationship between the two at play, the US’ government’s “Cold War and anti-communist hysteria provided public cover for government action on behalf of UFCo, (the company’s) personnel facilitated the CIA’s Cold War task of subverting the Árbenz government” [Gordon, Max. “A Case History of U. S. Subversion: Guatemala, 1954.”Science & Society 35, no. 2 (1971): 129-55. Accessed July 27, 2020. www.jstor.org/stable/40401561].

Notwithstanding the fact that local communists held some sway over the Guatemalan labour movement, their impact on decision-making within the Árbenz government was at best minimal. Árbenz’ objectives on taking control were not doctrinal but pragmatically liberal ones – political liberalisation, creation of a middle class, modernisation of the country, to free the Guatemalan economy from dependency on world coffee prices and from control by foreign corporations𝄪 (Gordon). Try as they may, US apologists arguing that the intervention was saving the country from communism have failed to make any plausible, even indirect, connexion between the Árbenz government and the Soviet Union✧. Immerman’s view is that the State Department confused communism and nationalism [cited in Bowen)❂.

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⬆️  JF Dulles, Time’s “Man of the Year, 1954”

Isolating the Western Hemisphere’s outlier state 
With former UFCo lawyer John Foster Dulles guiding US foreign policy, the diplomatic isolation of Guatemala was complete when it cajoled the other members of the Organisation of American States (OAS) into accepting its anti-communist resolution in the region at the Caracas meeting early in 1954. The US, with assistance from the UK, also blocked Guatemala’s efforts to secure UN intervention against those seeking to destabilise its democracy.

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⬆️  Rebel troops attacking Guatemala City
(Source: www.latinamericanstudies.org)

End-game: The putsch and its denouement
By late 1953 Eisenhower had given the “green light” to the invasion plan that became Operation PBSUCCESS in 1954. The US propaganda campaign intensified a few months later with saturation airdrops of anti-Árbenz leaflets across the country. Concurrently, the US Embassy in Guatemala City employed  blocking equipment to jam the government’s official wireless channels and replace it with misinformation discrediting the Árbenz regime (Bowen). The CIA chose a renegade, expat Guatemalan officer on the outer with Árbenz to lead the coup attempt. From Honduras, Colonel Castillo Armas, with a small force of Guatemalan exiles and mercenaries and financed largely by the CIA, invaded the country. At first repulsed by Árbenz’s troops, the rebels fortunes turned around after Peurifoy persuaded JF Dulles to provided them with air cover. US-piloted planes duly strafed Guatemala City and other towns. American intimidation and terror had a telling psychological effect on the population. Guatemalan army commanders, fearful of a full US military intervention, defected from Árbenz, and refused to allow the president to arm the peasant militia to resist the invaders, this prompted a demoralised Árbenz to resign his office in June 1954 and seek asylum in the Mexican Embassy. After some jockeying for power within the country’s military junta Castillo Armas emerged as the new (US recognised) national leader, hurling Guatemala once again into the void of a crippling military dictatorship [RABE, STEPHEN G. “The U.S. Intervention in Guatemala: The Documentary Record.” Diplomatic History 28, no. 5 (2004): 785-90. Accessed July 30, 2020.www.jstor.org/stable/24914824.]

⬇️ Mexican artist Diego Rivera’s graphic take on the Guatemalan putsch   

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❈ forcing it to seek arms from Czechoslovakia, allowing the US to fling further mud, characterising it as an evidence of Árbenz’s ongoing collusion with communism

⧆ revealingly, the New York Times at the time described Peurifoy as “a man of action rather than a diplomat”, The New York Times, 18-July-1954

⌑ as Moye has noted, the Guatemala crisis provided a convenient and fairly easy way for the Eisenhower administration to demonstrate its promised “victory over communism”  [MOYE, LAURA. “The United States Intervention in Guatemala.” International Social Science Review 73, no. 1/2 (1998): 44-52. Accessed July 31, 2020. www.jstor.og/stable/23883544/].

◰ a foreign policy position of the US, first enunciated in 1823, warning off European powers from interfering with the governance of existing countries on the American continent

𝄪  at the time of Guatemala’s to transition to a democratic state, the US accounted for 77% of its exports of 65% of its imports. UFCo functioned in Guatemala (and elsewhere in the region) as a “state within a state”, controlling 42% of the Guatemalan land and benefitting from light tax and import duty burdens [‘Background on the Guatemalan Coup of 1954’, www.umbc.edu/].

✧ Marks offers a contrary view, that the Árbenz government did pose a genuine communist threat, had a tendency towards authoritarianism itself and that the president had lost the confidence of the majority of Guatemalans by 1954 [MARKS, FREDERICK W. “The CIA and Castillo Armas in Guatemala, 1954: New Clues to an Old Puzzle.” Diplomatic History 14, no. 1 (1990): 67-86. Accessed July 30, 2020. www.jstor.org/stable/24912032]. Although Rabe et al have countered that Marks’ conclusions rely on early State Department documents that have been discredited

❂ Getchell contends that in fact the USSR were “unwilling to prop up what they considered a bourgeois-democratic revolution” [‘Revisiting the 1954 Coup in Guatemala: The Soviet Union, the United Nations, and “Hemispheric Solidarity”’, (Michelle Denise Getchell), Journal of Cold War Studies, 17(2):73-102. April 2015. DOI: 10.1162/JCWS a 00549]