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Economic Development of Central America Econ. 4200 - Spring 2004 – Dr. Taylor - page 73 / 153

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Leaders of the time… Martinez, Ubico and Somoza were sympathizers with Italian fascism: strong central government, nationalism, xenophobia, Corporative State (state directed economic activity and control of unions).

Reform along fascist lines meant that the power of the state was enhanced and political institutions linked to the upper reaches of civil society. This translated into control or weakening of political parties and competitive elections.

Note passage on page 122: “If the state can successfully use violence to suppress the majority of the population, and if it can regulate economic life well enough to maintain the incomes of the propertied elite, it is an institution that potentially could be used against the privileged who it was created to protect.” This potential began to be realized in what decade?

 Most governments got themselves into financial trouble during this time and experimented with a new approach to deal with this problem. What was this approach and how did it help?

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