Metro Center shopping mall, a modern retail center in San Salvador

In the late 1980s, El Salvador was experiencing severe internal stress as a result of an ongoing insurgency, a severely debilitated economy, and persistent socioeconomic inequalities. Despite reform efforts begun under the post-1979 civilianmilitary junta governments, the country's longstanding division between rich and poor still represented a challenge to Salvadoran leaders and to the society as a whole.

The sharp contrast between those with great wealth and those living in extreme poverty had characterized Salvadoran society for more than a century and had roots in its colonial past (see Spanish Conquest and Colonization , ch. 1). When El Salvador became an independent republic in the early nineteenth century, this pattern did not change. Wealthy landowners, members of only a very few families, organized the national government to secure their positions and continued to dominate Salvadoran national life. Rural peasants and workers provided for their own subsistence needs and labored for the elite. Indeed, as the century progressed, this pattern was sharpened by the successful introduction of coffee as an export cash crop. As the landed elite, along with more recently arrived European banking and financial families interested in coffee, began to realize the wealth potential of this crop, they increased the size of their estates.

They did so by absorbing into their private holdings public lands (forests) and the communal lands of municipios (the Salvadoran equivalent of counties) and Indian communities, lands formerly cultivated in small subsistence plots by mestizo and Indian peasants. The government officially decreed these common lands out of existence in favor of private property ownership in 1881. Those dispossessed of their subsistence lands became permanent or seasonal laborers working for extremely low wages on coffee estates, which were labor-intensive enterprises. To protect their lands and their prosperity, the coffee elite formed a strong economic and political oligarchy. The army and the National Guard (Guardia Nacional--GN) were employed to control the unrest and occasional open rebellions among the many now landless and poorly paid laborers.

When coffee prices fell during the Great Depression of the 1930s, laborers' wages were reduced still further, and since much subsistence land had been converted to private coffee cultivation and the production of staple crops had declined accordingly, living conditions worsened (see Economic Crisis and Repression , ch. 1). Unemployment rose too, as many coffee growers decided not to harvest their crops. In addition, many small landowners, unable to survive the low coffee prices, lost their lands to those who were wealthier, and landownership became even more concentrated.

In the decades following t3e3 the depression, export agriculture became somewhat diversified as cotton and, to a lesser extent, sugar also became important plantation cash crops, and some of the elite began to argue for industrial development. The upper class in general, however, strongly resisted any significant changes in the basic social, economic, and political order. After a rural uprising in 1932 and the brutal reprisals later referred to as la matanza (the massacre), in which about 30,000 were killed by troops, the dominance of the elite was preserved and defended by the Salvadoran military (see Economic Crisis and Repression , ch. 1).

Data as of November 1988