Operation PBSUCCESS was a CIA-organized covert operation that overthrew the democratically-elected President of Guatemala, Jacobo Arbenz Guzmán in 1954. Arbenz's government put forth a number of new policies that the US intelligence community deemed to be Communist in nature, and, suspecting that the Soviet Union was pulling the strings, subsequently fueled a fear of Guatemala becoming a "Soviet beachhead in the western hemisphere"

Note on naming
Main articles History of Guatemala, Decree 900
Under the regime of General Jorge Ubico, and Ubico's predecessor Manuel José Estrada Cabrera, Guatemala was widely opened up to foreign investment, with special favours being made from Ubico to the United Fruit Company (UFC) in particular. The UFC responded by pouring investment capital into the country, buying controlling shares of the railroad, electric utility, and telegraph, while also winning control over the majority of the country's best land and de facto control over its only Atlantic port facilities. As a result, the Guatemalan government was often subservient to the UFC's interests.
In the the "October Revolution" of 1944 General Jorge Ubico was overthrown. Juan José Arévalo Bermejo was elected. A new constitution allowed for the possibility of expropriating land. This, as well as Arévalo philosophy of "spiritual socialism", alarmed Guatemala's landed elite who began to accuse Arévalo of supporting Communism. In 1947 he signed a labor protection law that implicitly targeted the UFC. The American Embassy in Guatemala sent alarming messages that Arévalo was allowing Communists to organize and had reputedly provided known Communists with support. Arévalo supported the Caribbean Legion, a group of ostensibly reformist Latin Americans who plotted to overthrow dictatorships in the Dominican Republic, Venezuela, Nicaragua, and Costa Rica. A 1949 CIA analysis described it as a "destabilizing force".[1]
Jacobo Arbenz Guzman, who as an army Captain had played an important role in the "October Revolution" of 1944, won 65% of the vote in the 1950 election.
In the US McCarthyism caused of intense anti-Communist suspicions.

Background
Arbenz advocated social and political reforms, unionization, and land reform. For the latter, Arbenz secretly met with members of the Communist Guatemalan Labor Party (known by its Spanish acronym 'PGT') in order to establish an effective land reform program. Such a program was proposed by Arbenz as a means of remedying the extremely unequal land distribution within the country: in 1945, it was estimated that 2.2% of the country's population controlled 70% of all arable land, but with only 12% of it being utilized

Land Reform
Main article: Operation PBFORTUNE
As early as 1951, before the agrarian reform law had been be written or passed, CIA apprehension about a Communist takeover caused the agency to seriously explore options for Arbenz's overthrow. Arbenz's toleration for known Communists made him at best a "fellow traveler," and at worst a Communist himself.[2] The most viable option being considered was the covert backing of rebel groups and dissidents already active in Guatemala and the then CIA Director of Central Intelligence (DCI) Walter B. Smith sent an agent to Guatemala City to investigate potential candidate individuals or organizations. At the time the state of the opposition to Arbenz was inert, divided, and increasingly fractious. The agent returned empty handed. Fortunately for the CIA, this roughly coincided with the first state visit of the President of Nicaragua, Anastasio Somoza. He informed them of Castillo Armas's small rebel group and stated that, with the CIA's support, he and Armas could unseat Arbenz. They also could expect financial backing from Dominican dictator Rafael Trujillo and, as Armas later claimed, from internal elements within the Guatemalan army. DCI Smith urged his subordinates to follow up on this and to establish contacts with Armas, which they did in June of the same year. At the CIA's request, Armas then relayed to them a plan for invasion, which was to launch from El Salvador, Mexico, and Honduras (from UFC land) and would be coordinated with simultaneous uprisings within Guatemala. Armas requested arms, money, aircraft, and boats and informed them that he would launch the invasion as planned regardless of the CIA's support if need be. In July the CIA secured arms, transport, and $225,000 (US) for Armas, and furnished a few WWII-era airplanes. In September the CIA secured State Department approval and Operation PBFORTUNE was set.
One of two major setbacks occurred shortly afterwards when, while preparing for the arms shipment, the operation had to be called off. Somoza had been speaking of the invasion plan with other Central American leaders and the operation's cover, which was very important due to the fragile diplomatic situation the United States had with the region, was blown. While Operation PBFORTUNE was officially terminated, the operation led a twilight existence with the arm shipment prepared prior still kept in waiting and with Armas being kept on a $3,000 a week retainer, which allowed him to hang on to his small troupe of rebels.

Operation PBFORTUNE
With the departure of President Truman and the arrival of Eisenhower hopes were again raised within the CIA about the possibility of reviving the invasion. Eisenhower expressed favor towards covert operations as a means of cheaply and covertly combating the Soviet Union. While working towards getting this support, anxiety within the Agency about the possibility of a premature coup attempt being enacted by over-eager rebel groups began to rise and was justified in early 1953 when a futile and poorly planned invasion was attempted by a rebel group marginally associated with Armas. The invasion precipitated exactly the reaction feared within the Agency: the Guatemalan government was provided with a justification for severely clamping down on anti-communist elements within their county -- jailing many -- and was supported by a popular backlash against the anti-communists amongst the people. With almost all of their local assets destroyed, the CIA was forced to rely solely on the much more fragmented exile groups.
After all but abandoning the project in mid-1953, the U.S. National Security Council revived the project in August of that year after a review of the situation in light of the success of the recent CIA-organized coup against Mossadegh in Iran. CIA officers involved included Tracy Barnes (CIA officer in charge), David Atlee Phillips, Jacob 'Jack' Esterline, E. Howard Hunt, David Sanchez Morales.
Re-naming the operation to "PBSUCCESS", the planners consolidated all of the successful elements of previous operations, combining psychological, diplomatic, economic, and paramilitary actions. Economically, the Agency enlisted the help of some top-ranking American businessmen who would be assigned to put covert economic pressures on Guatemala by creating shortages of vital imports and cutting export earnings. Diplomatically, the Agency planned to convene a meeting of Organization of American States (OAS) with the specific intention of using it to ostracize and alienate Guatemala from the other countries in the region, as well as increasing "aid" to neighboring countries Nicaragua, Honduras, and El Salvador to win over their consent and, in the case of the latter two, to gain the use of their land as a staging area for the invasion. Once the building of pressure using diplomatic, economic, and propagandistic means reached its zenith, the CIA planned to then let Armas' rebels loose when the country was at its most unstable.
Upon establishing operation headquarters in Florida in December 1953, the Agency started recruiting pilots, oversaw the training of rebels, set up a radio station to use for propaganda purposes, and stepped up the diplomatic pressure on Guatemala. Although they couldn't halt the exports of coffee, a major industry in Guatemala at the time, they succeeded in foiling two deals to buy arms and ammunition from Canada and Germany. Faced with dwindling military supply and witnessing the build up of armaments in neighboring countries, Arbenz started to seriously take into account the possibility of an invasion, which had been rumored for months and finally confirmed when a defector from the Agency's stable of rebels informed the Arbenz regime of PBSUCCESS and its details, and began looking for potential sellers of crucial supplies. This brought Arbenz to conclude a secret deal with Communist Czechoslovakia for 2,000 tonnes of captured German arms that were left in storage since the end of World War II a decade ago. While the arms deal was met with a Soviet protectorate, their knowledge of it was limited and the deal was strictly cash-and-carry. When the arms shipment arrived the CIA took their opportunity and promoted the transaction as proof of the Soviet hand pulling the strings and it ended up being a major propaganda victory for the CIA insofar as winning the American public's support for regime change in Guatemala was concerned.
After the revelation of the Czech arms shipment and the domestic support it whipped up, the US drastically stepped up both its covert and overt campaigns. On May 20, 1954 the US Navy began air-sea patrols under the twin pretexts of arms interdiction and protection of Honduras from Guatemalan invasion.(http://www.history.navy.mil/library/online/forces_cold.htm#table6 ;see entry #29.) On June 7, a "contingency evacuation" force, consisting of five amphibious assault ships plus an "anti-submarine warfare" (ASW) aircraft carrier was dispatched to the area. Embarked was a US Marine Battalion Landing Team (http://en.wikipedia.org/wiki/Battalion#United_States_Army_and_Marine_Corps); meanwhile the only utility of the ASW carrier in the situation could have been for helicopter assault (then under development by the US Marines).
These forces were used to implement a comprehensive sea blockade of Guatemala by the American Navy. Known as Operation HARDROCK BAKER, it also included the deployment of submarines - again, ostensibly to stop and inspect all incoming ships for arms (though submarines are not at all suited for this role). The de facto aggressive configuration of this naval force, and the disingenuous representations of its true purpose, had a decisive psychological impact within Guatemala, extinguishing the remaining hope of international law coming to the assistance of Guatemala and raising the very credible prospect of an American invasion.

Propaganda
At 8:00 p.m. on June 18 Castillo Armas's forces crossed the border. Divided into four groups, his roughly 480 strong party invaded at 5 key points along the Guatemalan-Honduran and the Guatemalan-Salvadorian border. This was done to give the impression of a massive forces invading along a wide front, and also to disperse the men so as to minimize the chance of the entire force being routed in a single unfavorable engagement. In addition to these regular troops, 10 trained saboteurs slipped in ahead and were given the task of blowing up key bridges and cutting telegraph lines. All of the invading forces were instructed to minimize actual encounters with the Guatemalan army, for many reasons but most of all to avoid giving reason for the uniting of the army against the invaders. The entire course of the invasion was specifically designed to sow panic and to give the impression of insurmountable odds in order to bring the populace and the military over to its side, rather than defeat them. During the invasion radio propaganda also assisted towards this end, transmitting false reports of huge forces joining the local populace in a popular revolution.
Almost immediately, Armas's forces met with decisive failure. Invading on foot and hampered by heavy equipment, it was in some cases days before the rebels reached their objectives. This weakened the psychological impact of the initial invasion, as local Guatemalans realized they were in no immediate danger. One of the first groups to reach its objective, the group of 122 rebels whose task it was to capture the city of Zacapa, were severely crushed by a small contingent of 30 Guatemalan army soldiers, leaving only 28 rebels who had escaped death or capture. An even larger defeat was handed to the group of 170 rebels who undertook the task of capturing the heavily guarded port city of Puerto Barrios. After the police chief spotted the invading force, he quickly armed local dock workers and assigned them defensive roles. In a matter of hours the vast majority of the rebels were killed or captured, with the remaining men fleeing back into Honduras. Within 3 days, two of Armas's four prongs were out of commission. Attempting to recover momentum, Armas ordered an air attack on the capital the following day. This too failed, as a single slow flying plane managed to bomb a small oil tank, creating a minor fire that was doused in 20 minutes.
After these rebel failures, Arbenz ordered his military commander to allow Armas's forces to advance deep into the country. Arbenz and his chief commander didn't fear Armas's ragtag army, but there was a concern that, were the rebels to be too severely crushed, it would provide a pretext for open American military intervention. This fear spread widely amongst the officer class, with no one wanting to engage and defeat Armas's increasingly decimated force. Rumors spread - fueled greatly by the presence of the American amphibious assault force - that a Honduran landing by US Marines was in progress; preparatory to an invasion of Guatemala. Arbenz began to fear that the officers would be cowed into striking a deal with Armas and so began to take actions (elaboration needed) to win back their confidence. Confirmation of Arbenz' fear was given when an entire army garrison surrendered to Armas a few days later in the town of Chiquimula. Arbenz summoned his cabinet to explain that the army was in revolt and on June 27 Arbenz announced his resignation.

Invasion
In the 11 days after Arbenz's resignation five successive juntas occupied the presidential palace, each more amenable to American demands than the last, with Armas himself finally taking office at the end. He proved to be embarrassingly inept and his corrupt and repressive policies renewed civil conflict unseen in the country since before the revolution of 1944. An unexpected result of the coup was the ferocious condemnation of it by the international press. Le Monde and The Times both attacked America's "modern form of economic colonialism." There was a widespread and long-lasting protest of the coup in Latin America, with Guatemala becoming a symbol of resistance to American designs for the region. United Nations Secretary General Dag Hammarskjold accused the US's actions of being at odds with the UN Charter and even West German papers, usually gentle to America, were condemning the coup.
According to Kate Doyle, director of the Mexico Project of National Security Archives and a regular contributor to Americas Program of the Interhemispheric Resource Center, most historians now agree that the military coup in 1954 was the definitive blow to Guatemala's young democracy. Over the next four decades, the succession of military rulers would wage counter-insurgency warfare destablizing Guatemalan society. The violence caused the deaths and disappearances of more than 140,000 Guatemalans, and some human rights activists put the death toll as high as 250,000.[3] At the later stages of this conflict the CIA tried with some success to lessen the human rights violations and in 1993 stopped a coup and helped restore the democratic government.
Following closely on the heels of the successful CIA-orchestrated coup which overthrew the democratically elected government of Iran to allow the Shah to rule autocratically in 1953 (see Operation Ajax), some argue that it employed ideas and methods that were relatively new at the time and, due to the ostensible success of the operation, led to Operation PBSUCCESS becoming the de facto model for the overthrow or destabilization of a defiant government for some time to come, including the abortive coup in Cuba in the early 1960s and Chile in the 70s.

Aftermath
After the campaign, the CIA sent a handful of agents to Guatemala in order to gather and analyze government documents that would, amongst other things, find evidence that would support the CIA's belief that Guatemala was a rising Soviet puppet state, in an operation that was known as Operation PBHISTORY. Despite amassing well over 150,000 pages, they found very little to substantiate the key premise of the invasion ; the socialism that gained influence under Arbenz's presidency in fact had no ties to the Soviet Union whatsoever. Nevertheless, some private sector leaders and the military began to believe that Arbenz represented a Communist threat and supported his overthrow despite most Guatemalans' attachment to the original ideals of the 1944 uprising.

Operation PBHISTORY

See also

Mr. Arbenz. Richard Bissell, a former Special Assistant to the Director of Central Intelligence, says in an interview that there "is absolutely no reason to believe" the desire to help United Fruit played "any significant role" in reaching the decision.--Crisis in Central America on PBS Frontline, The New York Times April 9, 1985, Page 16

Note 1: Cullather, Nick (1999). Secret History: The CIA's classified account of its operations in Guatemala, 1952-1954. Standford University Press. ISBN 0-8047-3311-2. , pg 17, quoting Allen Dulles
Note 2: Stanley, Diane (1994). For the Record: United Fruit Company's Sixty-Six Years in Guatemala. Centro Impresor Piedra Santa. , pg 179
Note 3: A U.S. State Department report released in 2003 states that social unrest within Guatemala and Arbenz's alleged Communist ties were the reason the CIA first drew up a contingency plan to oust Arbenz, entitled Operation PBFORTUNE (later changed to Operation PBSUCCESS.) The plan was drafted in 1951, before the U.S.-based United Fruit Company's landholdings had been expropriated. [4]
Note 4: Cullather, Nick (1999). Secret History: The CIA's classified account of its operations in Guatemala, 1952-1954. Standford University Press. ISBN 0-8047-3311-2. , pg 90
Note 5: La Feber, Walter (1993). Inevitable Revolutions The United States in Central America. Norton Press. ISBN 0-393-03434-8. , pg 116-117, quoting Notes of Undersecretary's Meeting, 15 June 1951, FRUS, 1951, 2:1440-43, 1445