POLITICAL AND ECONOMIC STRAINS IN COLOMBIA

Created: 1/29/1965

OCR scan of the original document, errors are possible

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SUBJECT: Political and Economic Strains in Colombia

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believe tbat the National Front under President Valencia has become too weak to cepe with the growing political andstrains in Colombia and therefore io not likely to survive the remaining year and one-half of Valencia's term. Fecponsible civilian and military leaders will almost certainly try toolitical remedy for tha defects of tbe system, but, because of tbe ootorioufl factionalism of the compooeota of the Nationalhange in the system will probably have to be Imposed by force.

1. The last-alnute suspension of tbe general strike threatened foranuary and the removal two days latexar Minister of doubtful loyalty to the Notional Front have, in our view, only temporarily relieved the acute political and economic pressures confronting the government of Preoident Valencia. Valencia has

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precised topecial session of Congress in February to deal with economic prcbloms and the leaders of tee national Front cay prove able toormula to weather the current storr. of

protest against governaent policies. We believe, nonetheless, that the political credit of the Rational Front already has eroded beyond recovery and that the rystcm as presently constituted is unlikely to survive the remaining part of Valencia's tens (to.

2. The Rational Front system was written into Colombia's constitution by the leaders of the Conservative and Liberal parties primarilyeans of reducing the extreme partleon antagonisms that hadecade of near civil war. This It has dene reasonably well since its inceptionowever, with ite requirements for presidential alternation, equal division of all offices between the two partlea, and two-thirds majorities for major legislation, the National Front baa proved to be an Inordinately cumbersome form of government which could

work well only under the best of leadership and the most favorable of conditions. Neither of thece prerequisites is now present; for the past year or so the government hae not been able even to addreBU itself to the country's urgent social and economic problemsustained basis, much less to alleviate them.

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3. Presidentonservative vhos inapt betaolitical leader nnd as an For the past year, the factions of theparty nominally supporting the National Front havedivided by personal disputes, and for this andthe Conservative and Liberal directories have beento cooperate effectively. What is more,ajor defeat in the

losing effective control over Congress. Even if the President vere capable of vigorous leadership and the National Front parties were capable of close cooperation, it would still prove extremely difficult to get controversial legislation through the present Congress.*

* The National Front system permits electoral contentsiterals and among Conservatives for the congressional seats aaeigned to each party. At present, members supporting the National Front hold only two seats more than the needed two-thirds majority ln the Chamber of Deputies, tooargin regularly to survive absenteeism and breaches of party. The remaining cents are held by Conservatives belonginG to the National Popular Alliance (ANP) and by Liberals belonging to the Pevolutionary Liberal Movementoth of which ore committed to bringing down the National Front.

The political decline of the National Front ls in large port the result of the dismal eccnoaic performance of

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the Valencia government. The National Front le an obvious attempt by Colombia's oligarchy to preserve lta traditional political In order to maintain Diddle and lover class support for the systemand incidentally to qualify for special treatment under the Alliance for Progresshe National Front2 launched an impressive plan for accelerated economic expansion and social reform. But largely because of foreign exchange and budgetary strains, the Valencia government vas forced to abandon the plan: economic growth slewed down, bank credits for middle-class businessmen become more difficult tD obtain, investments in social projects declined, and so dideal wages. In return, tbe middle ond lover class voters In large numbers have deserted tbe National Front.

5. Frcm time to time the Valencia government has attempted to relieve its financial strains; invariably, however, its measures have proved Inadequate. What probably haB been needed mosteneral devaluation of the Columbian peso, in conjunctiontrengthening of monetary controlsubstantial increase in tax revenues. These measures have been strongly opposed by various special interest groupa, and tbe government has been either unwilling or unable to pursue them vigorously.

6. Economic pressures against the Valencia governaent probably will increaae during the courseerhaps to critical proportions. During recent years, Colombia haa managed to make ends Beet ia its foreign payments lergely by resorting to huge drawings of short-term credits. Foreign bankers and auppliern, who in the past had tended to believe that the US Government would supply generous amounts of financial assistance to the "showcase" country of the Alliance for Progress whenever needed, now arc worried about Colombia's future solvency and apparently are beginning to tighten their terms for renewing credits as they come due. An acceleration of thio tendency couldajor foreign exchange crlsiG later this year.* Cn the home front, the government, in order to ease'labor discontent, may be forced to withdraw the sales tax that recently went Into effect. This could throw its budgetary accounts even further out of balance.

7. If there is to be an extraordinary governmental change In Colombia, what form will it take? The moat likely form3 of

Tbe debt repayments affecting the reserve poaition of the Bank of the Republic that nominally fell due5 ere in the range of0 millions, equal in valueercent of Colombia's total export earnings duringand exceeding substantially the Bank's uncemmitted bard currency reserves.

system by its precent leaders, nr possibly scce combination of tbe tvo: for example, political leaders mightilitary Junta to hold power temporarilyransitionew system. Extremist groups in Colombiaommunists, CastroiotB, endof ex-dictator Rojas Pinillaprobably bave tbe cepacity to bringrisis that wouldhange in government. They would be unlikely to Increase substantially their political poweresultrisis, however, and would almost certainly be incapable of gaining control of the government.

8. ilitary Coup. Tbe removal of Minister of War Alberto Ruiz. Novoa probably haa reduced for the short term the threatilitary coup. General Ruiz had otrong presidential ambitions: he bed been planning to challenge the National Front candidate lnlection, but he probably would have seized upon any opportunity to gain poweroup,culd have been carried off peacefully. Although supportoup probably had grown Bomewhat in recent weeks, many key officers bod opposed Ruiz's political ambitions. His removal was not at tbe initiative S

An estimate of the political and revolutionary potentialities of extremist groups in Colombia is contained in, "Communist Potentialities in LatinotedX,.

of President Valencia, but at the derond of General Gabriel

Refceiz Pizerro, commander of the Armed Forces, who was seconded

by the cccmnrder and the chief of staff of tte Amy, end subsequently

supported by the cccaandcrs of the Havy, the Air Force, end the Police.

Rebels, tte new Minister of War, can besupport President Valencia for the time being, buta military coup can be expected to recur whenever thebegins to believe that civilian rule is leading to Thus, if the special session ofexttotally unproductive andeneral strike againthere probably will be renewed pressures for Military restIreness probably would alsothe threat of expanded extremist insurgency raised by the

7 January raidown In corthccntral Colombia ls net dealt with effectively.*

from Within, heavy pressure would have toto beer on President Valencia, end on othergroups, to perauado then to give up all or some cf thethey now exercise. The key to any change from within would

As dictlngulr-hed from the violence which has been endemic in Colombia for many years, this raid was conductedeil-organisedupported by Cuba.

probably be the replacement of Valenciaore effective chief

executive, either outright or by turning presidential powers overe facto price minister. Faced witb the alternatives of chaos, military intervention, or yielding political power, Valencia might eventually choose to submit. But the substitution of another politician for Valencia,ore forceful one, would not in itselfemedy for the factionalism and immobllism of the Rational Front systemand any attempt to alter the system Itself could probably be accomplished only by coercion.

U. Is the National Front system there-faro likely to beby force? The issue remaina in doubt. Responsible civilian and military leaders, remembering both the Rojaa PlnlUaand the chaotic situation which preceded it, will almoet certainly try herd toolitical remedy for the present defects of tbe system, but tbe notorious personalism and factionalism of the components of the Batiocal Front will militate againstolution of the problem. It would appear that, in tbeeform of the system will have to be imposedr else the political, economic, and security situation in Colombia will continue to

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