Guatemala’s Gross National Products: Cocadollars, Repression, and Disinformation

In the early 1980s, leftist guerrillas in Guatemala blew up bridges, ambushed army convoys, and attacked military outposts. A decade later, the fighting in Guatemala’s civil war is winding down. Combat between the government and the guerrillas now occurs in only a few departments and only a few times each year. But political violence, almost exclusively by the government, continues. Even the U.S. State Department reported in 1991 that the military, civil patrols and the police continued to commit a majority of the major human rights abuses, including extrajudicial killings, torture and disappearances.

The Guatemalan counterinsurgency campaign was conceived with the support of U.S. counterinsurgency experts such as Caesar Sereseres and Colonel George Minas. Sereseres has served as both a consultant to the Rand Corporation and a Central America expert in the State Department’s Office of Policy Planning. Today, Guatemalan army officers still describe him as someone who understands our situation. Minas served as a U.S. military attache in Guatemala in the early 1980s. Both encouraged Guatemala’s population control strategy, involving the use of Vietnam-style military-controlled strategic hamlets and civilian defense patrols.

The strategy of control was also characterized by a litany of human rights crimes that stand out not only in the region but in the world. The violence was so severe in the early 1980s in Nobel Laureate Rigoberta Menchu’s home department of Quich, to cite but one example, that the entire Catholic archdiocese shut down and withdrew, with all its priests, nuns, catechists, and many parishioners. The situation there and in other departments by 1982 led Guatemala’s Conference of Catholic Bishops to conclude: Not even the lives of old people, pregnant women or innocent children were respected. Never in our history has it come to such grave extremes.


Not everyone suffered. Guatemalan army spokesmen openly point out that the carnage has given Guatemala a level of national stability it lacked earlier in the war, and made the country comparatively more stable than El Salvador, Honduras, or even Mexico. With the military firmly in charge, and the civilian government largely irrelevant, foreign investment has climbed. Low wages have attracted Asian firms wanting to set up sweatshops, as well as European and U.S. tourists.

It has also attracted the network of cocaine traffickers based in the Colombian city of Cali. The cartel picked Guatemala because it is near Mexico, which is an obvious entrance point to the U.S., and because the Mexicans have a long established and well organized mafia, said a Latin America drug enforcement expert. It is also a better transit and storage country than El Salvador because it offers more stability and was easier to control.


In the 1980s, Guatemala was an insignificant player in the cocaine trade. Today, however, Guatemala is the largest Central American bodega or warehouse for cocaine transshipments to the U.S., and ranks behind only Mexico and, perhaps, the Bahamas in transshipping cocaine to the U.S. Analysts at the Drug Enforcement Administration (DEA) and the State Department’s Bureau of International Narcotics Matters (INM) now estimate that between 50 and 75 metric tons of cocaine are shipped through Guatemala each year. (In comparison, the same experts estimate that before the present embargo, between 6 and 12 metric tons a year passed through Haiti.) Mexico and Guatemala, which share a common frontier, together move at least two-thirds of the cocaine now reaching the U.S.

Guatemala’s booming cocaine trade now distorts the Guatemalan economy, drawing local businesses into a web of cocadollars and fostering corruption in both business and the military. The Cali cartel and its Guatemalan partners are trafficking cocaine that, at the wholesale price of $15,000 a kilogram, is worth as much as one billion dollars a year or one-tenth of Guatemala’s entire GNP.

Evidence of the cash flow generated by the cocaine trade is abundant: Real estate prices in Guatemala City, by conservative estimates, rose over 350 percent in just three years, while inflation dropped from 60 to 14 percent over the same period. Even more illicit funds appear to be channeled into the construction industry, which has grown steadily at a rate four times faster than the rest of the economy. While other Central American capital cities only seem to deteriorate, Guatemala City’s skyline continues to expand even though the newly constructed buildings still have ample vacant office space.

The situation became so unnerving by November 1992 that a group of local exporters organized an unprecedented conference: how to detect whether their export products are being used to run drugs. They held the conference seven months after 6.7 tons of cocaine enough to supply the total U.S. demand for a week was discovered in cases of frozen broccoli shipped to Miami. Even these business leaders concede that, in a sluggish global economy with many export markets depressed, the profits available from cocaine trafficking can be extremely tempting. Newspaper editors say that the cocaine trade in Guatemala has been able to buy out entire businesses as well as institutions. But although everybody in Guatemala seems to know about it, hardly anybody is willing, publicly, to say even a word.


Off the record, Western diplomats, leading entrepreneurs, church officials and others all charge that senior Guatemalan army officers are deeply involved in the cocaine traffic. Although not even one military official has yet to be prosecuted in either Guatemala or the U.S., 10 military officers and 20 paramilitaries under them have already been indicted or implicated. They include:

1) Ex-Lt. Colonel Carlos Ochoa Ruiz and two army captains, all of whom were caught in a DEA sting back in 1990, smuggling a half metric ton of cocaine, worth $7.5 million wholesale, to Tampa, Florida.
2) A retired Guatemalan Air Force captain who owned a safe house outside Antigua where the DEA found 2.8 metric tons of cocaine.
3) Four army colonels, a major, a captain and 20 army-appointed civilian commissioners in Los Amates in eastern Guatemala, who are accused in legal testimony by survivors of having ordered the separate murders of nine peasants, and the torture and abuse of many more.

The Los Amates survivors charge that the army drove them off their land to build runways to smuggle drugs. One of the military commissioners they name, Arnoldo Vargas Estrada, was later extradited to Brooklyn, New York, where he will be tried for smuggling several tons of cocaine a month by tractor trailers to the U.S.


The Guatemalan army’s office of Information and Dissemination, on the other hand, counters that leftist guerrillas of the Guatemalan National Revolutionary Unity (URNG) are responsible. Not one guerrilla or political opponent of the Guatemalan government has been either charged or indicted. Yet the Guatemalan army maintains that they should be.

Its Department of Information and Dissemination has a manila envelope, marked with an official stamp SECRETO, which spokesmen are eager to show to journalists upon request. The documents describe an alleged anti-drug operation high up in Guatemala’s northern Peten jungle, where the URNG guerrillas were once strong. According to the documents, in July 1991 a Treasury Police unit engaged in combat with guerrillas discovered a small plane with Colombian registration. Included in the file is a photograph of a white male wearing a baseball cap with the letters, in place of a ball team, DEA. He is standing over the plane’s cargo stacked brown paper-wrapped packages and holding up a flag with the initials FAR the acronym for one of three wings of the URNG.

For reasons still unexplained, the Army waited 16 months until November 1992 to release the secret file, the color Polaroids, and an army-produced video of the alleged raid.

The video begins with members of the Treasury Police running single file up to a line of trees, and firing automatic weapons in sequence at an unseen enemy. Later, these armed soldiers are seen around a small plane and the brown packages. The film then zeros in on the Polaroid of the white male wearing the baseball cap with the letters DEA. When asked whether this man with the DEA baseball cap was a DEA agent, army spokesman Captain Yon Rivera said, Look at it. You can see for yourself. When asked why the DEA hasn’t said anything about the guerrillas running cocaine, spokesman Yon Rivera, commonly identified in local newspapers as The Voice of the Armed Forces said: The DEA has not accused the guerrillas for this. I don’t know why they don’t want to say it.

U.S. Embassy officials in Guatemala City declined comment. When asked about the raid, Joyce McDonald at DEA headquarters in Washington faxed a description of the raid, the video, and the man with the DEA baseball cap to the DEA Field Division in Guatemala City. That office faxed back a brief response: DEA is unfamiliar with the film or scenario described above.

Blaming the guerrillas is not without a certain irony. The same army spokesmen who claim the guerrillas are running tons of cocaine boast in the same breath how the guerrillas are militarily defeated. The army estimates that there are fewer than 500 full-time guerrilla combatants left.Yet, the army fails to explain how a mere 500 stragglers under pressure just to stay alive, let alone fight could be responsible for receiving, storing and transshipping the bulk of Guatemala’s flow of cocaine.


Although the charge that the guerrillas are behind the cocaine traffic is, on the face of it, without basis, it is regularly reported as fact throughout Guatemala. The Guatemalan army’s ability to manipulate the press is yet another violent legacy of its past. After seeing more of their colleagues killed or disappeared than in any other country in Central America (and that is saying a lot), Guatemalan journalists rarely challenge anything the military says. No matter how broad or baseless, the military’s allegations are still regularly reported in Guatemalan daily newspapers, radio, and television reports in most cases, without a word of qualification. And regionally based foreign journalists have simply ignored the military’s accusations, if they’ve bothered to report on Guatemala at all.

As a result, neither Guatemala’s nine million citizens (most of whom, like the peasants in Mexico’s Chiapas, are of Mayan descent), nor North American consumers of news about Guatemala are well served. Guatemalan citizens have been saturated with the view that their tiny country is the victim of a global communist conspiracy that endures despite the end of the Cold War. And countless Guatemalans, especially among the whiter, wealthier members of its population, very much do believe it. This is a war here, said one such businessman, between the country and those who want to destroy it, the guerrillas. Meanwhile, North American readers have been insulated from the most outlandish of Guatemalan officials’ accusations, and their by any post-Cold War standard extreme world view. The failure of the U.S. press to adequately report on Guatemala is one reason why the Clinton administration enjoys warm relations with Guatemala despite its authoritarian past and present.

The Guatemalan army maintains that the URNG guerrillas have compensated for their battlefield losses by shifting their resources to a political warfare campaign. While the guerrillas are poor military commanders, say Guatemalan army representatives, they are brilliant manipulators of world opinion. The army claims that the guerrillas’ propaganda campaign is not only successful but has managed to either manipulate or control individuals, organizations, publications, and even governments.

In August 1992, Newsweek ran a story, “Subtle Clues in Shallow Graves: Uncovering evidence of massacres in Guatemala”. In response, then Guatemalan Minister of Defense Jos Garcia Samayoa threatened to press charges against Newsweek and respected forensic anthropologist Clyde Snow, who conducted the investigation. The General said, “It worries us to see how foreign interference in this case has grown in dimension, injuring…the independence and sovereignty of Guatemalans.”

International authority Clyde Snow, who has examined cadavers in Kurdistan, Chile, Argentina, and most recently Mexico’s Chiapas, has harsh words for the Guatemalan army: The military guys who do this are like serial killers. They got away with it once, so they think they’ll always get away with it. If Jeffrey Dahmer had been in Guatemala, he would be a general by now. Around the same time, indigenous leader Rigoberta Menchu, from Guatemala’s most war-torn department of Quich, was a candidate for the Nobel Peace Prize. Then army spokesman Yon Rivera was not impressed: The only thing Miss Menchu has done abroad is create a very bad image of our country. After she won the prize, Rivera charged that Guatemala had been the victim of a global political warfare campaign, but he didn’t know whether it was a case of direct infiltration. At the very least, he charged, the Nobel committee itself had been, somehow, unduly influenced by the URNG.30

The Guatemalan army has accused the U.S. of participating in the political warfare as well. By 1991, congressional critics had helped persuade the Bush administration to cut military aid to Guatemala, which it did partly over the murder of an American innkeeper, Michael Devine. That led the Guatemalan army to claim that the U.S. government itself had been unduly influenced by the URNG. According to the army’s Department of Information and Dissemination, members of the U.S. Congress and the State Department have been, respectively, conspirators and dupes. There is a U.S. congressman who has on his staff a member of the URNG, spokesman Rivera said in an interview, although Rivera could remember neither the congressman nor his staff member’s name. But one name he could recall was that of Frank LaRue, whose activities Rivera said proves his point. According to Rivera, LaRue is a lobbyist for the URNG, who enjoys undue influence in the State Department. “He has an open door,” said Rivera, nodding his head. He has the key.

LaRue made the Guatemalan national stage over a decade ago when he defended Coca-Cola workers in a bitter strike in Guatemala City, after which he went into political exile until 1994, when he returned briefly to Guatemala. While in the U.S., LaRue was a well-known activist in the Guatemalan opposition movement, and continued to work on labor and human rights issues in Guatemala through the privately-funded Center for Human Rights Legal Action in Washington, D.C. It was in this capacity that he was invited to the State Department for meetings with Guatemalan army representatives to discuss issues of military justice and human rights.

U.S. journalists who criticize the military are also accused of being part of the conspiracy. After the Washington Post published an article by the author about the Cali cartel and the Guatemalan army on December 26, 1993, the Army’s Department of Information and Dissemination held a press conference the following day to respond: Members of the Department of Information and dissemination of the Guatemalan Army reiterated that `there exists a campaign against the prestige of the government and the armed forces on the part of groups that seek to satisfy their own interests by creating a negative image of the country and the democratic process that we live in.


Indeed, according to the Guatemalan army, this campaign against the prestige of the government and armed forces is one of the broadest in the history of the Cold War, which, it maintains, has yet to end. And, if the Guatemalan military is to be believed, the propaganda campaign has extended its tentacles to some very unlikely places. In January 1993, the army uncovered a conspiracy involving an entertainment establishment, a local television station and U.S. Secret Service agents attached to United Nations dignitaries visiting New York.

Guatemala’s then formal head of state, President Jorge Serrano (who last May failed to survive his own Fujimori-style self-coup), was on an official trip to the United Nations. Although the visit coincided with President Clinton’s inauguration, the Guatemalan leader was not invited. After Serrano spoke to the U.N. General Assembly, blaming Guatemala’s leftist guerrillas for much of his country’s problems, he went for a drink at Stringfellows of NY, Ltd. in the posh Gramercy Park neighborhood of lower Manhattan.

The Guatemalan leader found a table facing a stage with naked, dancing women. A local free-lance cameraman happened to be having a drink and watching the show too.

The next day at 6:00 p.m., WNBC-TV’s News 4 New York aired an exclusive report. It captured the Guatemalan leader trying to hide his face behind a white ski parka and hood, while exiting the club and entering the back seat of his waiting limousine. In addition to close-ups of the President’s face, viewers saw his armed U.S. Secret Service escorts as well as his entire diplomatic motorcade. After running the tape, the news anchor added that President Serrano is an outspoken born-again, evangelical Christian.

News 4 New York aired the report again at 11:00 p.m. But in the later broadcast, the anchor included President Serrano’s official response. He blamed his capture on film at the go go bar on manipulation by Guatemala’s leftist guerrillas.

Spokespersons for News 4 New York, Stringfellows of NY, Ltd., and the Secret Service were all, at first, incredulous and then offended. All deny the charge.

What the Guatemalan army fails to realize is that the more it blames leftist guerrillas for its problems, the more isolated it becomes. During the Cold War, Guatemala was already a pariah regime within the world community. But with changes and reforms now taking place or on the horizon in places as troubled as South Africa, the Middle East, and Northern Ireland, continuing Guatemalan political violence, cocaine trafficking, and military impunity leave that country more alone than ever.