Amid falsehood and sophistry we have
reached the extreme in which the campaign
against Nicaragua is carried out in the
name of democracy. It is no small paradox
that the destruction of a democratic re-
gime is proposed in order to save it from
future risks or that an attempt is made to
create a chain of peripheral dictatorships
to maintain the welfare of the central
democracies.
Mexico’s President Jose Lopez Portillo’
Mornings before work or on weekend after-
noons-once a week-thousands of volunteers
gather in Managua’s many open fields. Practic-
ing with old World War I rifles or wood make-
believe ones, they learn to march, to run with a
rifle, to hug the ground, to shoot straight. The
new recruits to the Sandinista Popular Militia
tease each other lightly as they form into practice o
squads, taking particular aim at the veteran
guerrilla fighters among their ranks. “Hey,
companero, did you come just to get off all that
weight you’ve put on with your soft desk job?”
The laughter isn’t because they don’t feel the
gravity of their commitment, but because they
do.
It was only two years ago that Nicaragua fin-
ally drove Somoza and his National Guard from
the country-at a cost of 40,000 dead, an equal
number of children orphaned, 100,000 wounded,
200,000 families left homeless and 750,000
dependent on food assistance. 2 Homes, fac-
tories, hospitals, schools, roads, croplands,
whole cities were destroyed. Now with astound-
ing resilience, 100,000 Nicaraguans all over the
country are preparing to have to fight again.
Volunteers of all ages join Militia to defend revolution.
When asked, they aren’t sure where the inva-
sion will come from, but they are sure it will
come. It might be just the counterrevolutionary
groups training abroad, with logistical support
from Honduras, or it might, as we have seen, be
the Honduran Army itself. Some are convinced
the United States will intervene directly.
Building for the Roll-Back
The Republican National Platform brazenly
promised to “roll back” the Nicaraguan revolu-
tion. But the route to this reversal is still being
charted by Reagan’s new team. Nicaragua is no
25NACLA Report
Chile. The opposition has no access to state mili-
tary power; at most, certain sectors have links to
one of the myriad counterrevolutionary groups
outside the country. (Last November, Jorge
Salazar, acting head of the private sector’s um-
brella organization, the Superior Council of
Private Enterprise, was killed in a shootout with
Sandinista security forces. He and other mem-
bers of the private sector were accused of con-
spiring with counterrevolutionaries in the ex-
terior.)4
In spite of its show of military force, the
Sandinista government is actually weak
and could be overthrown by a determined,
coordinated and sharply focused effort.
Cleto DiGiovanni, Department of State
Consultant 3
The Sandinista government, in contrast, has
the loyalty of an experienced, politically con-
scious and highly motivated military force, the
40,000-strong Sandinista Popular Army. 5 It also
has the allegiance of the majority of its people.
Implicitly acknowledging their own weak-
ness, counterrevolutionary leaders admit that
their strategy is contingent on gaining massive
support inside the country (“. . a popular in-
surrection similar to the one that toppled the
Somoza regime”) as well as military support
from neighboring countries to the north. 6 But
such a goal is the stuff of which pipe dreams are
made, and the presence of ex-National Guards-
men within their ranks is hardly a political asset.
Nonetheless, Reagan’s strategy must include
chipping away the Sandinistas’ popular base of
support. One aspect of this campaign is to intensify
the already active propaganda machine that plays
on the anti-communist legacy of Somoza’s reign.
Particularly effective on wavering middle-class
sectors, it is being carried out with fervent self-
interest by the opposition parties, the reactionary
press and sectors of the religious hierarchy (see
Update article, this issue). On the predominantly
English-speaking. Atlantic Coast (which for the
most part remains an historically isolated and
politically troubled area), the Voice of America
resonates with the Reagan line.
A second aspect is aimed at the most vulnerable
point of the revolution, an economy still ravaged
by the effects of civil war. “Economic strangula-
tion,” however, is not an end in itself, but another
means. It presupposes that persistent economic
hardship will significantly erode support for the
Sandinista project. It is perhaps best summed up
by recalling a cable to Henry Kissinger from then
U.S. Ambassador to Chile, Edward Korry:
“Once Allende comes to power in Chile we will do
all in our power to condemn Chile and Chileans to
the utmost deprivation and poverty; a policy de-
signed for a long time to come to accelerate the
hard features of a communist society in Chile.” 7 In
February 1981, the United States suspended
economic aid to the Nicaraguan government.
For this to have the necessary impact, however,
Reagan must extend his offensive to the interna-
tional arena, to dissuade other countries from fill-
ing the financial gap. There too, the Administra-
tion faces an uphill battle. Nicaragua enjoys sup-
port not just from the socialist countries, but
western capitalist governments as well. And last
year, the member parties of the Socialist Interna-
tional (SI) formed a solidarity committee which
pledged to “avert foreign intervention in Nica-
ragua’s internal affairs by outside powers” and
to respect Nicaragua’s “right to self-determina-
tion.”8
Thus far, Reagan’s major public initiative to
undercut Nicaragua’s popularity internationally
has been to link the country to his “communist ex-
pansionism” theory. First the Nicaraguan govern-
ment was accused of supplying Soviet and Cuban
weapons to the revolutionary forces in El Salvador,
a charge the Nicaraguans have consistently
denied. Next the Administration had 100 Nicara-
guans invading El Salvador in a wooden boat.
Ambassador White himself had to backtrack on
that one. Now the State Department is claiming,
again without offering a shred of evidence, that
heavy Soviet T-55 tanks are being shipped to
Nicaragua “under camouflage”(!) from Cuba.
This one has even produced skeptics within the
State Department itself. James Cheek, awaiting
reassignment, noted merely, “The intelligence
community has reported this half a dozen times.
One day they’ll be right.” 6 Another observed
pointedly that Honduras had recently received
about 20 medium-weight British tanks, better
suited to the border terrain between the two coun-
tries.
The accusation also produced a rapid and terse
response from Nicaragua. Refusing to dignify it
with an affirmation or denial, Comandante
Humberto Ortega, Minister of Defense, declared
Nicaragua’s right to defend its national sovereign-
ty and the revolution.’o
The propaganda spinoffs of this “accusation
by assertion” campaign are many. Nicaragua is
26MaylJune 1981
not only an “agent of international terrorism,”
but it is also under Marxist-Leninist “domina-
tion” and, hence, fast becoming a “totalitarian
state.” Reagan’s train of thought isn’t the least
derailed by the apparent paradox that La Prensa,
Nicaragua’s reactionary daily, remains free to
make equivalent accusations.
On the diplomatic front, the effort to black-
ball Nicaragua has found little if any echo. Pres-
ident Jose Lopez Portillo of Mexico, undaunted
by a visit from White Paper drum-beater Ver-
non Walters, pledged that, “Mexico will defend
the cause of Nicaragua as its own.”” France’s
new Socialist president, Francois Mitterand, of-
fered a similarly strong pronouncement.
Economically, the Administration has had no
better results. Immediately following the U.S. an-
nouncement in April that it would continue the
suspension of aid indefinitely, a series of new
bilateral loans and donations were announced,
demonstrating the serious and complex foreign
policy contradictions unleashed by Reagan’s
assault.
In its first year and a half, the Sandinista
government had been very successful in securing
new bilateral credits and technical assistance from
diverse sources. (Western Europe and Canada ex-
tended over $100 million in economic aid, 13% of
the total, and Latin American countries provided
nearly $200 million, or 23% of the total. Social
democratic countries and the Soviet bloc nations
provided primarily technical assistance and per-
sonnel.) In April, European countries pledged a
total of $30 million; Libya, $100 million; and
Cuba, $64 million in technical assistance. 2 Other
countries, such as Canada, reaffirmed their com-
mitment to future aid and assistance, and still
others rushed to fill the gap left by the cutoff of U.S.
wheat credits. (The Soviet Union, Bulgaria and
Sweden donated a total of 38,000 tons, East Ger-
many has pledged 70,000 and Canada is begin-
ning to supply wheat in June, albeit not at the
favorable credit terms provided by the U.S. food
assistance program.) 1 3
Pressuring the Weakest Point
The Nicaraguan economy is still dependent
on large injections of foreign aid, resulting at
least in part from Somoza’s policies in the final
years before the FSLN victory. As the end
neared, Somoza compensated for massive capi-
tal flight with increasing foreign indebtedness,
ultimately contracting government debts on his
own properties in order to liquidate his assets
and place his wealth abroad. The new gov-
ernment inherited a staggering $1.6 billion
debt, with only $3.5 million in foreign exchange
left in the Central Bank. Furthermore, the war
itself caused $480 million in material damages,
not including the revenues lost from the paraly-
sis of economic activities during the war, par-
ticularly in agriculture.”1 In short, “The
economic disaster inherited by the Government
of National Reconstruction has no precedent in
Latin America.” 1
Last year, the United States was the largest
single donor and second largest lender after the
Inter-American Development Bank (IDB), pro-
viding $118.5 million in donations and loans
through November (14% of Nicaragua’s total
foreign aid for the period). Thus, the U.S.
boycott is significant. Only as long as Nicaragua
can continue to count on diversified lending
sources will it not be critical. Apart from $53
million in proposed U.S. aid for fiscal 1982,
credits to the government currently affected by
the cutoff include the $15 million balance of the
original loan package, $10 million in PL-480
food aid and $11.4 million for rural develop-
ment, education and health.’ 6
Not affected are grants for the private sector
and U.S. private institutions totalling $10.6
million. Two beneficiaries of these include the
Superior Council of Private Enterprise
(COSEP), a major opponent of the govern-
ment, and the American Institute for Free
Labor Development (AIFLD). In fact,
AIFLD’s average anntial budget of $100,000
per year for its Nicaraguan programs was more
than tripled by the Agency for International
Development in 1981. A major beneficiary of its
16 years of labor training and project assistance
has been the Confederation for Trade Union
Unity (CUS).’ 7 Together with CTN, a Social-
Christian oriented union confederation, CUS
joined several bourgeois parties and COSEP
last year in withdrawing from the Council of
State. (AIFLD, it should be noted, was also one
of the few organizations funded by AID during
the destabilization campaign against the
Allende government.)
The Sandinista government is for the most part
only seeking loans on soft terms available either
bilaterally from other governments or through in-
ternational lending agencies. Therefore, one of the
most important questions is whether the United
States will next use its power to block concessional
loans to Nicaragua. In both the IDB and the
27NACLA Report
World Bank, the United States exercises veto
power, and at present Nicaragua has 14 loans
totalling $300 million pending before these two in-
stitutions. According to sources at both agencies,
no overt signs of pressure have yet been evident.
The U.S. Export-Import Bank, on the other hand,
provided $8.9 million in credits for commercial
foreign sales during the final year of Somoza’s
rule, and dropped that figure to $40,000 in the first
year of the revolution.'” This cutback affects,
among other items, much-needed spare parts.
The Internal Contradictions
If they are trying to destabilize us, to
weaken our resolve and, finally, to clip the
wings of the Sandinista Revolution, these
dangers will disappear to the degree that
the working class unites, the national sec-
tors unite, and their unity becomes strong
and consistent.
Comandante Henry Ruiz, Minister of
Planning, January 13, 1981
It is a truism that economic conditions gener-
ate political responses, but the nature of those
responses depends on myriad other factors. In
the Nicaraguan case, it will depend on how peo-
ple decide to balance their own short-term eco-
nomic demands against the longer-term goal of
rebuilding a solid productive base in the coun-
try; the degree to which various sectors perceive
that the current revolutionary process is func-
tioning both well and in their best interest; the
way in which they assess other threats or op-
tions; and the extent to which the popular base
of the revolution understands and is incorpor-
ated into the decision-making process itself.
Reagan’s roll-back strategy assumes that all
these factors are moving in his favor. The revo-
lution, we are told in the press, is rapidly losing
support, and the “near-bankrupt” economy is
hastening the rout.19 Edmundo Chamorro,
leader of a Nicaraguan exile group, the
Nicaraguan Democratic Union (UDN), picks
up the theme, claiming that 80-85% of the
Nicaraguans now oppose the Sandinistas. 2 0 A
leader of the UDN’s paramilitary wing, the
Nicaraguan Revolutionary Armed Forces
(FARN), adds, “We have the support of the
democratic groups [sic] right now. When we get
started, the people are going to come with us.”‘ 21
The Sandinistas themselves make no secret of
the economy’s continuing difficulties, nor of the
grumblings that result. But the government ap-
parently feels sufficiently confident of its revolu-
tionary support to continue a program of eco-
nomic reactivation that does not contemplate
caving in to consumerist palliatives that could
guarantee immediate political support at the
cost of future economic viability. Nicaragua is
richly endowed and, given its small population,
has great economic potential. It only needs time
to rebuild from the war damage, reduce the
foreign debt, and reactivate industrial and
agricultural production.
According to a Ministry of Planning sum-
mary, production reached 99% of its overall
projection for 1980-that is to say, nearly 1978
levels. 22 Production was marked by serious un-
evenness, with agriculture surpassing the mark
by 11% and industry missing it by 20%. There
were also major social achievements, such as the
Literacy Crusade and advances in health, hous-
ing and consumption of basic goods. Due main-
ly to increased employment and salary increases
for the lowest paid workers, the latter rose 23%
in 1980.23
The goal for this year is 1977’s production
level-higher than war-distressed 1978. “Plan
81” calls for increased investment and employ-
ment in priority productive sectors and energy,
and a 9% increase in productivity. 2 4 Unparal-
leled increases in oil prices and debt service,
which together will require 67% of export reve-
nues, as well as deteriorated terms of trade (im-
ports cost 15% more while the price of coffee
dropped), will mean a serious restriction of
“non-essential imports.”
The plan, officially called the Plan of Auster-
ity and Efficiency, is just that. It contemplates a
maximum inflation rate of 20%, and projects
equivalent adjustments in real salaries only for
workers in the productive sector. 2 5 While Plan
81 “guarantees basic consumption for the popu-
lace at all cost,” and in fact projects a 12%
growth in this sector, the government is not
oblivious to the sacrifice and hardship it implies
for people whose economic expectations are now
high.
In a recent conference, a Planning Ministry
official identified three main areas of political
tension that are expected to arise.26 The first is
that the middle class, in particular those in-
volved in domestic commerce, will feel the con-
sumption restrictions most, and are least ideo-
logically prepared to accept them. Second, the
increase in labor productivity creates contradic-
28MaylJune 1981
tions for the working class. Quite apart from the
opportunities for agitation this gives opposition
trade union confederations such as the CUS and
CTN, it also demands discipline and a long-
range view from a working class with limited
political experience. The FSLN and the workers
must come to terms with the conflict between the
growth of militant and democratic trade union-
ism and the stringent constraints on workers’
economic demands. Further exacerbating the
situation, a substantial portion of Nicaragua’s
productive capacity is still in private hands, thus
alienating workers from full participation in
financial and productivity discussions.
The third tension, it is obvious, stems from
the international political conjuncture within
which the Sandinistas must function-the all-
out determination of the Reagan Administra-
tion to put an end to revolutionary efforts
throughout the region, including the re-isolation
of Cuba. Most recently, the United States warned
that it would cut Nicaraguan beef imports if
Nicaragua goes ahead with its plans to purchase
breeding stock from Cuba. While the rationale
is the possible spread of aftosa (hoof and mouth
disease), the Brazilian Aftosa Institute and other
organizations discount the existence of that
disease in Cuba. 2 7 Thus, the motivations are
clearly political. As if in confirmation, the
United States is also threatening to stop export-
ing the resin used in making polyvinyl chloride,
necessary for myriad Nicaraguan plastics
manufactures, presumably because Nicaragua
might sell its surpluses to Cuba. 2 8 The beef issue
has aggravated differences between the Sandin-
ista government and the private sector involved
in beef production.
But it doesn’t end with political and economic
attacks. There is also the ominous and pervasive
counterrevolutionary threat, punctuated, lest
anyone sleep too easily, with new deaths in border
clashes. The Sandinistas are loathe to divert
scarce reconstruction funds to military spend-
ing-according to junta member Rafael Cor-
dova Rivas, still only 1% of the gross national
product -but energies are certainly diverted. 2 9
The U.S. government has given money to
Honduras, and at least comfort and encourage-
ment to independent groups, some ten of which
are training in Miami and California.so Last
winter, dissidents in the Carter Administration
were already claiming that, “U.S. intelligence
has been in contact with Nicaraguan exile groups
in Guatemala and Miami…. No attempt has
been made to restrict their mobility in or out of
the country or to interfere with their activities.” 3 1
Nicaraguans are not moved by Reagan’s ex-
planation that the groups are training on private
property and therefore untouchable. “How
would the American government react,” asked
Daniel Ortega, “if suddenly in Nicaragua… it
should occur to some ranch owner to loan his pro-
perty to train Puerto Ricans to fight for the in-
dependence of their country?” 3 2
In earlyJune, Jose Francisco Cardenal, polit-
ical leader of a Miami exile group,* made com-
mon cause with the leader of a counterrevolu-
tionary movement on Nicaragua’s Atlantic
Coast by accompanying him in a vitriolic press
interview held in Miami.32 Steadman Fagoth,
head of the indigenous organization,
Misurasata, until his arrest in February for plot-
ting separatist actions, was in Miami to unite all
exiles “in a common effort against the ag-
gressors in our lands.” 3 3
An apparently charismatic personality,
Fagoth had opportunistically used the powerful
historic demands of the indigenous people who
represent some 60-70% of the Coast’s popula-
tion to spread disaffection with the revolution.
The Sandinistas, he claims, only want to “force
the nearly 200,000 Misurasata members to ac-
cept communist rule.”
In the days following his arrest, the govern-
ment released documents from intelligence ar-
chives showing that Fagoth had been an inform-
er during the 70s, denouncing Miskitos who
collaborated with the FSLN. (The Miskito are
the largest of the three indigenous groups on the
Coast.) After Fagoth’s provisional release in
mid-May he fled to Honduras, where he was
joined by an estimated 3,000 Miskitos. A second
purpose of his Miami visit was to get food,
clothes and medicines for these supposed
“refugees from Sandinista repression,” who
have already been rushed such supplies by the
Honduran government.
The Sandinista government last year
declared the integration of the Atlantic Coast a
priority. Despite advances such as developing
the Literacy Crusade in English and Miskito,
improving health and transportation services
and developing new agricultural projects, it
*Jose Cardenal, now a member of the Nicara-
guan Democratic Union paradoxically fled to Miami last
year after being selected vice president of the new Council
of State by the government. (See NACLA Report on theAmer-
icas, “Nicaragua’s Revolution,” May-June 1980.)
29NACLA Report
has been hampered in its objective by limited
economic resources as well as cultural
animosities that date back to the colonial period.
(The Coast was colonized by England which
helped its inhabitants successfully fight Spanish
incursions for almost 400 years. Costeilos still
refer to people on the Pacific side as “the
Spanish.”) The Sandinistas have apparently
redoubled their efforts to work with the new pro-
visional leadership of Misurasata to reduce the
tensions.
Aggression Accelerates Unity
U.S. aggression, however, has had the
countervailing effect of pulling some sectors
closer together. The private sector, divided on
the question of aid cutoffs, is participating
albeit warily, and slowly, in preparations for a
forum to explore ways to further national unity
in the face of U.S. actions.
Four pro-Sandinista parties, which last sum-
mer formed the Patriotic Revolutionary Front,
played a major role in preparing the agenda for
these meetings, and suggesting active forms of
solidarity against aggression. Another pro-
Sandinista group participating in the meetings
is the new Nicaraguan Trade Union Coordina-
tion Committee (CSN) established last Novem-
ber. Representing all union confederations ex-
cept CUS and CTN, the creation of this Coor-
dinating Committee culminated unity discus-
sions begun last April. In their initial confer-
ence, some 200 delegates to the CSN heatedly
discussed the difficult issues facing workers in
the coming period. 3 4
Another new organization, the National
Union of Farmers and Ranchers (UNAG) has
just taken its two seats on the Council of State.
This newest of the Sandinista mass organiza-
tions represents the interests of more than
100,000 small and medium landowners, mostly
producing basic foodstuffs for the domestic mar-
ket. 3 5 The consolidation of UNAG is an im-
portant advance in providing the campesino
base of the revolution with its own voice and
enabling the government to help them increase
much-needed food production. Previously, they
were represented either by the organization of
large capitalist growers (which joined the Coun-
cil of State walkout in November) or by the
Association of Rural Workers (ATC), neither of
which addressed their real needs.
After the wheat cutoff, the FSLN launched a
worldwide protest campaign called Bread for
Nicaragua, which has highlighted the violation
of basic human rights inherent in the act of using
food as a political weapon. And finally, an esti-
mated one million Nicaraguans-nearly half
the population-have been marching with their
neighborhood defense committees to polling
sites to sign a Letter of Dignity which expresses
their unity in the face of aggression. The letter
will be sent to governments all over the world,
most pointedly to the United States.
NICARAGUA
1. New York Times, May 8, 1981.
2. EPICA Task Force, Nicaragua: A People’s Revolu-
tion, Washington, D.C.: EPICA, 1980).
3. Intercontinental Press, April 13, 1981, p. 352.
4. Inforpress Centroamericana, November 27, 1980; In-
tercontinental Press, December 1, 15, 1980.
5. New York Times, April 2, 1981.
6. Ibid.
7. Isabel Letelier and Michael Moffitt, Human
Rights, Economic Aid and Private Banks: The Case of Chile
(Washington, D.C.: Institute for Policy Studies, 1978).
8. “Socialist International Nicaragua Solidarity
Committee Meets,” Socialist International Press Release,
21/80, December 6, 1980.
9. New York Times, June 3, 1981.
10. Diario Las Americas, June 6, 1981.
11. New York Times, May 8, 1981.
12. Inforpress Centroamericana, April 9, 23, 30, 1981.
13. Ibid.; Diario Las Americas, June 10, 1981.
14. Economic Commission for Latin America, Nica-
ragua: Economic Repercussions of Recent Political Events (New
York: United Nations, September 1979), p. 43.
15. Agence Latino-Americaine D’Information (ALAI),
Vol. 5, No. 13 (April 3, 1981), p. 150.
16. In These Times, April 15-21, 1981.
17. NACLA Report on the Americas, Vol. XII, No. 6
(November-December 1978), p. 9.
18. In These Times, April 15-21, 1981.
19. Washington Post, May 9, 1981.
20. Ibid.
21. Miami Herald, February 4, 1981.
22. ALAI.
23. Avances de la Revolucion Popular Sandinista (Mana-
gua: International Relations Department of the FSLN,
January 1981), p. 13.
24. Programa Economico de Austeridad y Eficiencia ’81
(Managua), 1981.
25. ALAI.
26. Ibid.
27. Central America Report, May 23, 1981; Latin
America Weekly Report, May 15, 1981; Inforpress Centroameri-
cana, May 21, 1981.
28. Latin America Weekly Report, May 15, 1981.
29. Diario Las Americas, June 7, 1981.
30. New York Times, March 17, 1981; Parade Magazine,
March 15, 1981; Washington Post, May 19, 1981.
31. “Dissent Paper on El Salvador and Central
America,” DOS 11/6/80 (DM-ESCA #80-3), November
1980, p. 11.
32. New York Times, April 21, 1981.
33. Diario Las Americas, June 11, 1981.
34. Intercontinental Press, December 1, 1980.
35. Intercontinental Press, April 20, 1981.
