Conflict Quarterly

The "Contra" War in Nicaragua

by
Gary Prévost

This article attempts to analyze the "contra" war, an ongoing strug-

gle between the government of Nicaragua and counter-revolutionary
forces who have the moral and financial backing of the U.S. govern-
ment. The unfolding of this five-year old war is considered by detailing
the U.S. government strategy in concert with the development of the
counter-revolutionary forces both politically and militarily. The effect of
the five-year war on Nicaragua's people and its economy will be explored
sector-by-sector, and a prognosis for the future will be offered.
Taking office in 1981, the Reagan administration initiated a new
policy toward Nicaragua designed to strangle the Sandinistas
economically and to begin the financing of an armed counter-
revolutionary army to be used against the Nicaraguan government. The
new administration's policy represented a shift from the Carter ad-
ministration which, while not supporting the Sandinista revolution, had
successfully lobbied Congress for approximately $100 million in foreign
aid, targeted primarily for the Nicaraguan private sector. The Carter ad-
ministration had hoped to affect the course of the revolution through
support of elements in Nicaragua that were seeking to temper the revolu-
tion and steer it toward the United States. Presidential candidate Reagan
attacked the Carter administration's Central America policies and once
in office moved definitively against the Sandinistas. The change began in
early 1981 with U.S. pressure on international aid agencies and banks not
to lend to Nicaragua and a cut-off of U.S. aid to Nicaragua. In 1982 the
U.S. followed with a 90% reduction of Nicaragua's quota for sugar im-
ports to the U.S., Nicaragua's traditional principal market.1
Concurrent with this economic pressure, the CIA engaged in a grow-
ing program of training, financing, and equipping a counter-
revolutionary army to launch attacks against Nicaragua. A $19.5 million
dollar program was approved for 1982, followed by $30 million in 1983
and $24 million in 1984. In the fall of 1984, Congress suspended the aid
program but in June 1985 a new program was initiated granting
"humanitarian" aid to the counter-revolutionaries. That program
distributed $27 million to the "contras" in the period ending March 31,
1986. On June 25, 1986, the U.S. Congress approved an additional $100
million in assistance to the rebel forces; the appropriation included
military armaments. This new aid began flowing to Central America
soon after it was approved by the President in October. In November the
public learned through the exposure of the Iran affair that the various of-
ficials in the Reagan administration had been involved in obtaining
money for the "contras" even during periods when Congress had bann-
ed either all funds or military assistance to the rebels. While there has
been considerable criticism in recent months of the White House for its
handling of the "Iran/contra" affair, it is not yet clear if Congress will

5
Summer 1987
terminate the assistance when it has the opportunity to do so in the sum-
mer of 1987.
What arguments did the Reagan administration use to convince a
reluctant Congress to support its Central American policy? President
Reagan spelled out his attitude toward Nicaragua publicly in a joint ses-
sion of the Congress on April 27, 1983. Reagan outlined four policy
goals in Central America. First, he promised to support democracy,
reform, and human freedom, particularly through the promotion of fair
elections. Second, to offset what he called "economic sabotage" by the
FDR-FMLN guerrillas in El Salvador, the President proposed economic
development. Third, in response to what he called the military challenge
of Cuba and Nicaragua, Reagan vowed to support the security of
America's allies in the region. Finally, the President pledged to support
dialogue and negotiations among the countries of the region and within
each country. The President's position was summed up by one of his
closing comments in the April 27, 1983 speech: "There can be no ques-
tion: the security of all the Americas is at stake in Central America. If we
cannot defend ourselves there, we cannot expect to prevail elsewhere."2
The President further underscored his remarks by warning those who
would oppose him that they would bear the responsibility if the U.S. was
less than forthright in opposing Nicaragua. By playing on the fear of
those in Congress who felt they would be labeled pro-Communist if they
continued to oppose him, the President was eventually able to carry the
day.
It should also be noted that many analysts believe the Reagan ad-
ministration sees much more at stake in Central America than simply the
defeat or containment of the Nicaraguan revolution. For example, then
Secretary of State Alexander Haig made clear that restoring America's
credibility and power was at stake in Central America: "I know the
American people will support what is prudent and necessary, providing
they think we mean what we say and that we are going to succeed and not
flounder as we did in Vietnam."3 For the Reagan administration Central
America is seen as a relatively safe arena for demonstrating that the
United States has recovered from Vietnam.
Contemporaneously with the arming and training of the "contra"
force, the U.S. government has carried out a massive military build-up in
Honduras. The scope of this build-up can be understood in simple terms
of U.S. military assistance to Honduras. Aid in the fiscal year 1980, the
final year of the Carter administration, was $4.0 million compared to
$31.3 million in the 1982 fiscal year. The increases have continued rising
to $37.3 million in 1983, $77.5 million in 1984, $62.5 million in 1985, and
$88.2 million in 1984." Another side of the U.S. build-up in Honduras
has been the virtually permanent stationing of U.S. military personnel in
the country through periodic maneuvers. The ongoing military exercises
have, in this author's opinion, a number of purposes including: the
preparation of the Honduran army for a possible attack against
Nicaragua; the preparation of U.S. Armed Forces to attack Nicaragua;
the creation of the practical infrastructure for a region-wide conflict; and

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 Conflict Quarterly
the gradual conversion of Honduras into an occupied country and a
docile instrument of American politics.
The maneuvers began in the summer of 1981 with operation "Com-
bined Deployment," 40 kilometers north of the Honduran border and
continued with "Halcon Vista" maneuvers in October on the Honduran
coast close to Nicaraguan beaches. These operations were stated to be a
demonstration that "Cuban and Soviet intervention in Central America
would not be permitted." The year 1983 saw a dramatic increase in U.S.
troop presence in Honduras beginning with the Big Pine I operation in
February involving 1,600 U.S. soldiers and 4,000 Hondurans. In the
summer, major U.S. naval maneuvers were conducted off both coasts of
Nicaragua, and in August 1983 the start of six month Big Pine II opera-
tions signaled the beginning of significant permanent U.S. troop
presence. During the last two years there has been an average of 3,000
U.S. troops in Honduras at any one time.5 In addition to the maneuvers,
the U.S. has upgraded the military infrastructure of the country
significantly: runways at six airbases have been extended; the Regional
Military and Security Training Center at Sin Sin has been upgraded; the
radar base at Cerro Hule has been renovated; and numerous highways in
the vicinity of the Nicaraguan border have been rebuilt. Additionally,
Honduran bases, over the objection of the Honduran government, have
become the major location for U.S. training of Salvadoran troops. The
Honduran bases became increasingly important with the closing of the
U.S. Southern Command training facilities in Panama. It should be
noted, however, that the actual use of U.S. military forces against
Nicaragua is not a foregone conclusion. While the Reagan administra-
tion has gained bipartisan Congressional support for its policy of sup-
porting the "contra," it has little support in Congress or among the
American people for direct military action against Nicaragua in the
absence of a more tangible national security threat to U.S. territory.
While U.S. military men have assured the White House that Nicaragua
can be subdued by U.S. military action, they have also cautioned against
the involvement of U.S. forces in Central America without a domestic
consensus in favor of such a policy.6 Another continuing constraint on
U.S. military action against Nicaragua is that such involvement would
likely cause severe damage to U.S. relations with the rest of Latin
America for a significant period afterwards. In conclusion it should be
noted that in spite of these obvious constraints, the use of U.S. military
force against Nicaragua remains a possibility. In the meantime, the
Reagan administration seems to be committed to its objectives against
Nicaragua through use of the "contra," making an analysis of their pro-
spects crucial.

DEVELOPMENT OF THE COUNTER-REVOLUTION

In order to understand the current state of the counter-revolutionary
forces and their future prospects, it is necessary to trace their complex
development since the fall of Somoza. At the time of the revolution in
July 1979 some 5,000-7,000 former National Guardsmen fled the coun-
try. By far the largest group went to Honduras, but others went to

7
Summer 1987
Guatemala, Paraguay, Argentina, and the United States. Political and
military organization began almost immediately among the exiles who
sought to return to power in Managua. Retraining began in private camps
in Florida operated in cooperation with various anti-Castro Cuban groups.
Initially the two main groups were the 15th of September Legion and the
Nicaraguan Democratic Union (UDN), then headed by Nicaraguan
business leader Jose Francisco Cardenal. These former Guardsmen
organized into small bands and raided peasant communities near the
Nicaraguan-Honduran border. A few isolated attacks were made on
literacy campaign workers during 1980. The fortunes of the "contra" were
given a boost in that year by the first defections from the revolutionary
government—the resignations of Violeta Chamorro and Alfonso Robelo
in April 1980. While they did not join the rebels at that time, these resigna-
tions together with the departure of Eden Pastora in 1981 demonstrated to
the rebels that political openings against the Sandinistas were possible
among those who had initially supported the revolution.
The efforts of the former Guardsmen were also given a big lift in
1980 by the election of Ronald Reagan to the Presidency of the United
States. During the campaign, Reagan had committed himself to an ag-
gressive policy against the Sandinistas; once in office, his administration
began a systematic effort to strengthen the anti-Sandinista forces. Edgar
Chamorro, himself a member of the UDN at that time, recounts that
Vernon Walters, now U.S. Ambassador to the United Nations, "arrang-
ed for all the bands to be incorporated within the 15th of September
Legion and for the military government of Argentina to send advisors
and trainers."7 The merger and creation of the Nicaraguan Democratic
Force (FDN) was consummated in August 1981 in Guatemala City at a
meeting arranged by the CIA. Also present at the meeting and in-
tegrating his forces into the FDN was Steadman Fagoth, a leader of the
Miskito Indian organization, MISURA (Organization of Miskitos,
Sumos, and Ramas). MISURA had initially worked with the Sandinista
government within the framework of a larger organization,
MISURASATA (Organization of Miskitos, Sumos, Ramas, Sandinistas
United), but the government dissolved that organization when its
leaders, Fagoth and Brooklyn Rivera, attempted to set up an indepen-
dent government in the northern Atlantic region. Following the dissolu-
tion Fagoth reformed MISURA as the first armed indigenous group on
the Atlantic coast and began to operate out of Honduras under the
leadership of the FDN. In fact, the first major military operation of the
FDN was carried by MISURA at the end of 1981. Named Red
Christmas, the operation resulted in the evacuation of 39 Coco River
communities to Tasba Pri some sixty kilometers to the south and caused
several thousand Miskitos to flee into Honduras.'
The northern front maintained by the FDN and the Miskito rebels
was only one of the two fronts that carried on the war against the
Nicaraguan government. During 1982 the war against Nicaragua became
a two-front war with the formation in Costa Rica of the Democratic
Revolutionary Alliance (ARDE) under the leadership of Eden Pastora

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 Conflict Quarterly

and eventually Alfonso Robelo. ARDE was a dissimilar formation in

that its leadership was not made up of former Guardsmen but rather sup-
porters of the Sandinista government. Eden Pastora, who won interna-
tional fame when he played a leading role in the Sandinista seizure of the
National Palace in 1978, later served as Vice-Minister of the Interior and
Vice-Minister of Defense. He left the country in July 1981, resurfacing
nine months later in Costa Rica announcing his intention to fight the
Sandinistas. Pastora was later joined in ARDE by two important allies
— Alfonso Robelo and Brooklyn Rivera. Robelo was a prominent oppo-
nent of Somoza who formed the Nicaraguan Democratic Movement in
early 1978. He served in the first National Reconstruction Government
junta from July 1979—April 1980 before breaking with the Sandinistas.
In early 1982 he left Nicaragua for Costa Rica where he was founder and
co-director of ARDE along with Pastora. Linking up with ARDE in 1982
was MISURASATA, the Miskito organization led by Broklyn Rivera.
MISURASATA was formed in 1982 by Rivera after he broke with Stead-
man Fagoth over MISURA's collaboration with the ex-National Guards.
Rivera used the name of the original indigenous movement as a sign that
he did not want to overthrow the Sandinista government but did demand
that it recognize the Indians' historical rights.'
Concurrently, the U.S. commitment to the counter-revolutionaries
escalated. In early December 1981 President Reagan authorized the
"contra" war as a CIA "covert" project. In April 1982, following the
U.S. support for the British in the Falklands/Malvinas War, the Argenti-
nian government withdrew its advisors from Honduras. Following that
withdrawal, the CIA took full control of the operation, and within
months it was the largest CIA operation since the Phoenix program of
the Vietnam War. During 1982 the FDN carried out its first significant
armed actions in the northern border regions, designed to acquire a por-
tion of Nicaragua, declare it "liberated territory," invoke the Inter-
American Reciprocal Assistance treaty, and call on the international
community to recognize a "provisional government." With this strategy
MISURA carried out the "Red Christmas" plan in late 1981, and in late
1982 the FDN tried to take various towns including Jalapa and Somoto.
These attacks, while often causing significant civilian casualties, failed in
their objective, and in fact, no significant town has been held by the FDN
at any time during the war. In 1983 the counter-revolutionaries diver-
sified their strategy, incorporating more political elements into its plans.
The FDN penetrated Nicaraguan territory to carry out various diver-
sionary activities: kidnappings, ambushes, and attacks on civilian and
economic targets. Its most spectacular success in that year was a sabotage
bombing of the Pacific part of Corinto that caused more than $100
million in economic losses. However, on the other side of the coin, at
least three times in 1983 the rebel forces tried and failed to take the town
of Jalapa. Such failures only served to underscore the lack of success of
the FDN's overall strategy to create a "liberated" zone. In 1984, the
FDN developed more ambitious plans, infiltrating the interior of the
country with its forces and generally seeking to create a climate of civil
war in the country. That year also saw the mining of two of Nicaragua's

9
Summer 1987
key ports, several aerial attacks, numerous attacks on agricultural
cooperatives, and a major attack in June on the city of Ocotal. ARDE
probably reached its height of activity in early 1984 when Pastora's
forces took the southeastern town of San Juan del Norte for two days
and carried out extensive military actions throughout the Nicaragua-
Costa Rica border area. However, since mid-1984 numerous splits and
controversies have rendered the southern contra front nearly irrelevant
militarily. During 1984 the FDN worked very closely with the CIA and
entered 1985 in a relatively hopeful state projecting for that year what it
called "the year of the Final Offensive." The plan was to culminate in
mid-year with an offensive within Nicaragua against the main central
and northern cities, following earlier attacks against Sandinista army
border units. The armed actions were to have been complemented by
propaganda actions aimed at legitimizing the counter-revolution widely
among the Nicaraguan population.10
In reality 1985 turned out to be a disastrous year for the counter-
revolution and may have represented the beginning of the end of their
political and military plans. The rebel plans for a "Final Offensive"
turned out to be significantly overstated. In particular, battalion-size
campaigns against major towns in central and northern Nicaragua
resulted in high casualties for the contra forces. According to the
Nicaraguan government, Sandinista forces inflicted 5,469 casualties in
1985, an increase of 70% over 1984." While the exact numbers may be
somewhat high, the dramatic increase is definitely verifiable and can help
to account for the recall of contra forces into Honduras by the end of
1985. The failure of the contra in that year can be directly traced to the
failure of the rebels to establish any significant political base within the
country and the increasing effectiveness of the Sandinista army. The
weakness of the contra during 1985 may also be attributed in part to the
total Congressional ban on assistance that began in 1984 and continued
well into 1985. However, it should be noted that recent revelations about
continued covert U.S. support for the contra during this period reduce
the persuasiveness of this argument to a certain degree. In spite of dif-
ficult economic conditions and significant civilian and military
casualties, the rebels have not been able to create a "civil war climate"
except in a few remote border areas. They have been able to win some
support from conservative peasants in the Northern regions of the coun-
try who have rejected the land reform programs of the government, but
they have failed to attract the support in urban areas and among the mid-
dle class that would enable them to build a political movement and an ar-
my able to reach into the towns and cities. The rebels continue to be seen
inside Nicaragua primarily as a purely military force led by former
members of the defeated National Guard and civilians who were loyal to
Anastasio Somoza. Such connections make significant recruitment dif-
ficult to achieve. To carry out its "Final Offensive" in 1985 the rebel
leaders had projected that they would grow at a rate of 1,000 per month
when in reality their numbers were probably smaller at the end of 1985
than they were at the beginning of the year.12 It does appear that rebel ac-
tivity within Nicaragua picked up somewhat during mid-1986 due at

10
 Conflict Quarterly

least in part to the air supply operations that were revealed when a U.S.
plane was shot down in southern Nicaragua in October. However, by the
end of 1986, contra activity within Nicaragua had again subsided. In ear-
ly 1987, following the flow of newly voted Congressional money to the
rebels, Reagan administration officials have claimed that the contra have
reentered Nicaragua in large numbers and will soon again be a major
military factor. It is obviously too soon to assess the validity of that pro-
position, but it is clear that the contra are under great pressure in 1987 to
prove their military capabilities, particularly in light of potential renewed
Congressional opposition to the funding.
Beyond their own problems, the plans of the FDN have been
thwarted up to now by the efficiency of the Sandinista forces. During
1985 and 1986 the 60,000 man Nicaraguan army was able to use a com-
bination of new equipment, better training, and new tactics to deliver
significant military setbacks to the counter-revolutionaries. Increased
assistance from the Eastern bloc countries brought Nicaragua automatic
weapons, mortars, long-range artillery and, most importantly, helicopter
gunships. Battlefield reports have indicated that the Soviet-made MI-24
helicopter gunships have made a distinct difference in limiting the rebels'
freedom of movement in certain parts of the country and in key battles. ' 3
The Sandinista army successfully used its new firepower in concert with
infantry units to blunt virtually all of the major rebel offensives in 1985.
Their success, particularly with helicopter gunships, has prompted the
U.S. government to begin to supply the rebel forces with surface-to-air
missiles through the 1987 (fiscal year) $100 million funding. As of early
1987 it is too early to tell whether the rearming of the contra and their
training at bases in the United States will be able to reverse the obviously
overwhelming military advantage that the Nicaraguan army possesses.
In spite of the gloomy outlook, the Reagan administration has
pressed ahead with its strategy of full support for the counter-revolution.
How has the White House attempted to carry it off in the face of obvious
obstacles? From the beginning the U.S. government pursued a two-track
strategy with the FDN forces in Honduras. On the one hand, the CIA ac-
cepted the Somocista leadership of the FDN and worked with these
former Guard commanders to plan and carry out increasingly significant
attacks on Nicaragua during 1982 and 1983. On the other hand, the U.S.
government worked to change the political face of the FDN leadership
hoping to make it more acceptable to the U.S. Congress which, by
mid-1983, was becoming wary of the CIA operation. In December 1983
the FDN restructured its military leadership, doing away with a separate
military command made up of five ex-Guardsmen. The general staff was
formally replaced by a Military-Civil command made up of four
members of the seven-person FDN directorate. However, Enrique Ber-
mudez and other ex-Guardsmen with the CIA advisors continued to
head-up operations in the field, a situation that continues down to the
present day. In addition, the CIA began to work on the political front
with Adolfo Calero, the president of the FDN direcorate. Calero, who is
based in Miami, was manager of the Coca-Cola franchise in Managua
and leader of the Conservative Party during Somoza's time. He has

11
Summer 1987

He has become an important person in the U.S. government's efforts to

unite the contra opposition. A key breakthrough in the U.S. efforts came
in June of 1985 with the constitution of the Unified Nicaraguan Opposi-
tion (UNO) bringing together Adolfo Calero, Alfonso Robelo, Arturo
Cruz, and their forces and supporters. Neither Robelo nor Cruz brought
significant organizational structures into the alliance, but both were
politically important as legitimate Somoza opponents who served in the
early juntas of the Government of National Reconstruction. The lack of
power of Cruz and Robelo has often been underscored during the past
year. In September 1985 Cruz reportedly attempted to reduce sharply the
influence of several former Guard officers including Bermudez, but he
was definitely rebuffed.'4 The continued weakness of Robelo and Cruz
led to a series of high level negotiations mediated by the CIA in Miami
during May 1986. On May 27, an accord was apparently reached that has
strengthened the hand of Robelo and Cruz somewhat by giving the
power to make key political appointments and to discipline or dismiss
military commanders of the directorate of UNO—the power previously
held by Calero alone. It should be pointed out that there is some skep-
ticism over whether the agreement will be carried out. Robert Leiken,
Senior Fellow at the Carnegie Endowment for International Peace, who
monitors the rebels, has commented, "This was a tough fight that
strengthens the democrats in the UNO, but we have to see now if the
agreement is applied."" Fundamental political differences may well pre-
vent the accord from being implemented. Cruz and Robelo represent the
Social Democratic wing of the rebel opposition. They are willing to con-
sider a negotiated settlement with the Sandinistas and believe that the
Nicaraguan revolution has brought some benefits to the Nicaraguan peo-
ple. In contrast, Calero is an ideological conservative with long-standing
ties to supporters of the Somoza regime who believe that the Sandinistas
must be overthrown militarily. Because the latter position is closest to
that of the Reagan administration, which offers the funding, Calero may
well feel little need to go beyond the formality of an agreement which can
be used to solicit additional assistance from the U.S. Congress. A new
crisis developed in early 1987 when both Robelo and Cruz threatened to
resign over the same issues that had surfaced a year earlier. On February
16, under considerable White House pressure, Calero resigned from his
UNO post while Robelo and Cruz withdrew their resignation threats.
However, few people believe that the leadership crisis has been solved.
Calero retains his more important post as the head of the FDN, and the
others are only political figures backed by the United States with no army
to support them in their bid to return to power in Nicaragua. Even an ad-
ministration official quoted anonymously was not too optimistic, saying
"What is happening now is a necessary first step, but there is no
guarantee it will work just because some people were moved around."16
It should also be noted that there have been important shifts within
the Miskito forces allied with the FDN. The MISURA organization led
by Steadman Fagoth was dissolved in 1985 and replaced with a new
organization under Fagoth's leadership—KISAN (Union of Coast In-
dians of Nicaragua). Formed under U.S. guidance in an attempt to end

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 Conflict Quarterly

the internal fighting in the armed indigenous groups, KISAN was openly
allied with the FDN to a greater degree than MISURA, becoming a
member of UNO in November 1985. KISAN has largely been unsuc-
cessful in bringing unity to the Miskito forces as both Brooklyn Rivera
and MISURASATA have remained outside of KISAN. Of greater
significance, KISAN underwent a split almost immediately after its for-
mation, with six of its commanders entering into negotiations with the
Sandinista government. At present, the Fagoth wing of KISAN has ap-
proximately 2,000 soldiers based in Honduras while the breakaway fac-
tion commands approximately 300 soldiers and controls nine Miskito
communities. 17 The Fagoth forces have carried out very little combat ac-
tivity within the last 18 months.
On the southern front, in spite of considerable political activity under
U.S. direction, there have been few tangible results in the form of renewed
contra military capability. In early 1984 the CIA was working closely with
Pastora, providing logistical support including a helicopter for the attack
on San Juan del Norte.18 However, at the same time, the CIA was pressur-
ing Pastora to unite with the FDN or lose his funding. In fact, he was given
a thirty day ultimatum that expired on May 30, 1984, when Pastora called
a news conference at the Nicaraguan border village of La Penca, where a
bomb exploded, killing three journalists and wounding Pastora. The
source of the bomb attack has never been determined. In any case, the
assassination attempt completed the split in ARDE and was followed by
mutual denunciations from Pastora and Robelo, each claiming to repre-
sent the real ARDE. Robelo went on to sign a joint declaration with the
FDN in January 1985 and to become a leader in the formation of the UNO
in June 1985. Brooklyn Rivera split from ARDE in 1984 to enter into
negotiations with the Sandinista government.
With Robelo and Rivera gone, and the remainder of the opposition
group in the UNO, the Pastora forces were instrumental in forming the
Southern Opposition Bloc (BOS) in July 1985. However, without signifi-
cant U.S. government backing the BOS languished, unable to carry out
military actions in the months following its formation. Its only visible ac-
tions in the period involved the capture of a boat from the U.S. peace
organization, Witness for Peace, in August. With the Nicaraguan army
in control of former ARDE camps on the Nicaraguan side of the San
Juan River, the new formation was unable to maintain a presence within
Nicaragua. On May 9, 1986, several discouraged Pastora commanders
signed an agreement accepting Fernando Chamorro as chief military
commander of the Costa Rican-based rebels. (Chamorro is the leader of
a UNO-allied group of about 400 fighters known as the Nicaraguan
Democratic Union.) One week later the deserted Pastora announced that
he was quitting the military struggle and requesting political asylum in
Costa Rica. The demise of Pastora has apparently been engineered by the
U.S. government to get the leadership of all the Costa Rican rebels into
the hands of people willing to cooperate fully with the agency and with
FDN. Pastora was never fully willing to play that role."
Whether the restructuring of the rebels under Fernando Chamorro

13
Summer 1987
will change the military situation on the southern front significantly re-
mains to be seen. Even if new money begins to flow from the U.S.
treasury, it is not clear that an effective fighting force can be organized
from Costa Rica. A key factor may well be the attitude of the current
Costa Rican government. President Oscar Arias has publicly criticized the
U.S. government funding of the "contra" and has stated on numerous oc-
casions that he is not interested in seeing Costa Rica used as a base for at-
tacks against Nicaragua. He has also expressed a willingness to cooperate
with Nicaragua in policing their common border. However, the will of the
U.S. government to re-establish a second front against Nicaragua should
not be underestimated. It is probable that the FDN acting alone cannot be
successful in achieving American goals. If renewed Congressional funding
becomes available, it can be expected that the U.S. will place maximum
pressure on Costa Rica to accept the rebel presence and terminate bilateral
agreements with Nicaragua. Costa Rica's dependence on the United States
for aid to its beleaguered economy will make it hard for President Arias to
resist the demands of the Reagan administration.
COSTS OF THE WAR
How can one measure the costs of the war to Nicaragua? One impor-
tant measure is casualties, the number of victims has been steadily increas-
ing in the last four years. (See Table 1.) In 1981 and 1982 a combined total
of 167 people were killed by contra attacks. In 1983 the number of deaths
rose sharply to 1,030 and then rose again to 1339 in 1984 and 1463 in
1985.20 It should be noted that the decline in contra activity in the second
half of 1985 resulted in a slowing of the death rate. Approximately three-
quarters of the deaths in 1985 occurred in the first six months of the year.
As expected the rise in the number of casualties is directly parallel with the
increasing number of clashes between Sandinista and counter-
revolutionary forces. (See Table 2.) In 1981-82 there were a total of 93 en-
counters. In 1983 there was a sharp increase to 600 followed by 948 in 1984
and 1637 in 1985.21 According to government statistics contra casualties
have also risen sharply from 377 in 1981-82 to 5469 in 1985.22 (See Table
3.) The impact of the casualties in Nicaragua, a country of 3.2 million peo-
ple can be better understood if the numbers are extended to the United
States. The equivalent number of dead in the United States would be ap-
proximately 1 million.
What has been the pattern of the civilian killings? The contra have
targeted a number of specific groups. Government workers, particularly
field workers of the Ministry of Agrarian Reform, have been attacked dur-
ing their trips into the countryside in the northern provinces. Health care
workers, Nicaraguan, Cuban and West German, have been another
primary target of the contra forces. In 48 months, ending in December
1984, 21 health workers were killed (one in 1981, two in 1982, thirteen in
1983, and five in 1984). In addition 31 others were either wounded or kid-
napped. The vast majority of the health care casualties have occurred in
the Atlantic Coast region where contra activity has forced the closure or
reduction of services in approximately forty clinics and hospitals. One par-
ticularly significant loss was the destruction in the summer of 1984 of the

14
 Conflict Quarterly
the hospital/clinic at Tasba Pri, the Miskito resettlement village. Overall,
it is estimated that up to December 1984 the health care sector had suffered
approximately $1 million in direct damage. The greatest single blow to the
medical sector from the war was the destruction of ninety tons of medical
supplies in the bombing of the port of Corinto in October 1983.23 By the
end of 1985 health services to 250,000 people had been impaired due to
damages incurred to 55 health units, including one hospital and four
health centers.24 The effect of the war most difficult to calculate is the
amount of resources that has been diverted from the health sector to
finance the costs of defense. It is, therefore, inevitable that the impressive
gains of the revolution in health care will be slowed in the coming years if
the war continues.
Another significant target of the "contra" war has been the area of
education. Loss of life among educational personnel has been substantial.
In 1984 alone, 98 teachers were killed and another 171 were kidnapped.
Over the first three years of the war, 247 members of adult literacy groups
have been assassinated and a total of 840 literacy groups have been forced
to close. The primary and secondary school systems have also been directly
affected by the war, particularly in the Atlantic Coast region where four-
teen schools have been totally destroyed and 359 have been forced to close
due to dangers to staff and students. The contra have also targeted Rural
Infant Service Centers, eleven of which have been destroyed.25
Total economic damage to Nicaragua during the contra war is dif-
ficult to calculate accurately, but it can be said that the damage falls
primarily into three categories:
(1) production losses, as a direct effect of combat or as a result of
workers leaving their job sites because of dangers in areas where
there has been fighting;
(2) drain of resources from development to defense; and
(3) damages to fixed assets and capital.
According to figures compiled by CEP AD (Evangelical Committee
for Development Assistance) covering the period from 1981 through 1984,
the total physical damage was $92.5 million, while the production loss
total was $300.4 million. In addition, the losses in export and increases in
imports needed to replace goods and equipment was $321 million.26 The
accompanying charts break down the physical damage and production
losses by year and by sector. The most striking trend demonstrated in these
figures is the steady increase in almost every aggregate category. Produc-
tion losses have grown from $4.3 million in 1981 to $171.4 million in 1984.
Physical damage grew from $2.7 million to $41.1 million in 1983 before
dropping to $16.1 million in 1984 and $15.7 million in 1985.27 One spec-
tacular sabotage action at the Port of Corinto in October 1983 did more
than $20 million damage alone and tended to skew the figures for 1983.
Production losses have risen steadily in all five sectors: agriculture, timber
and forestry, fishing, mining, and construction. (See Table 4.) To gain a
better understanding of the nature of the economic losses, it is necessary to
look more closely at each sector. The principal losses of fixed assets in
agriculture occurred in coffee processing plants, basic grain warehouses,

15
Summer 1987
workers' housing, livestock stables, and the loss of machinery in each of
these areas. In 1984 $69 million was lost as the result of attacks on eighteen
coffee processing plants and the abandonment of 12,000 hectares of coffee
due to potential physical danger to coffee harvesters.28 While exact figures
are difficult to obtain, significant losses occurred in the 1984-85 coffee
harvest season because the recruitment of needed seasonal workers fell
behind due to fear for individual safety in the coffee growing areas, many
of which are in northern Nicaragua near the Honduran border, the region
of greatest contra activity." The war has also affected the harvest season
in other ways. In November 1984 20,000 military reservists who were
preparing to harvest coffee had to be transferred to active military status
when an American invasion seemed imminent to many Nicaraguans
following accusations by the U.S. government that the Soviet Union was
supplying the Sandinista government with MIG aircraft. On a year-by-year
basis the number of people mobilized into the regular army and the
reserves definitely cuts down on the number of volunteer workers available
for the harvest. Volunteer labor has always been crucial to the success of
the Nicaraguan harvest, and city people have been increasingly fearful of
going to the countryside because of the war. President Daniel Ortega
presented the Nicaraguan government assessment of the 1984-85 coffee
harvest in a speech in March 1985. He reported that approximately 88% of
the crop has been harvested in spite of numerous attacks on the harvest by
the contra. He reported that 39 harvest workers were killed and that over
$1.1 million of damage was done including the destruction of seventeen
privately-owned coffee farms. Ortega also reported that more than 13,000
volunteers, 8,000 of them government workers, had participated in the
harvest along with hundreds of international volunteers from more than
twenty countries including the United States.30 By mid-1985 a total of
142,980 people, mostly from the agricultural sector, had been displaced as
a result of the fighting. In 1984 the Nicaraguan government spent $5.3
million on the displaced persons, but that figure grew to $20.4 in 1985.31
The emphasis in relocating people has been on the provision of a livelihood
not just a refugee camp. This policy has been relatively successful, but the
sheer number of people involved, some of whom have been moved more
than once, has escalated the costs to the government.
The contra attacks have often been concentrated on agricultural pro-
jects that have been initiated by the revolutionary government. The
strategy of these attacks is clearly aimed at breaking the Nicaraguan
peasantry away from the Sandinista government by sending out a message
that participation in government-sponsored projects can be dangerous.
Between 1982 and 1984 over seventy state farms were attacked or
destroyed. Agricultural cooperatives were singled out for attack at a rate
of 10 per month during 1984.32 The losses in the cooperative and state sec-
tor have been considerable. In 1984 alone, 25,000 acres of corn and beans
were abandoned in Jinotega and Nueva Segovia as the result of attacks,
resulting in a loss of $11 million.33 In many cases entire agricultural
cooperatives have been relocated to safer areas away from the border
regions. While such relocations are necessitated by the war, they only serve
to add to the financial burden placed on the Nicaraguan government.

16
 Conflict Quarterly

The timber and forestry industry has also been damaged by the war.
Losses have mainly occurred in Neuva Segovia and Zelaya Norte. In the
pine forests of Zelaya Norte alone, 44,000 hectares were burned in 1984,
with major effects on reforestation projects in the north-eastern part of
the country. The destruction of equipment and the sinking of a lumber
boat set back a project to produce construction timber that had been
scheduled to begin in 1983.34
The fishing industry has been adversely affected in several ways, but
primarily through contra destruction of boats and the subsequent diver-
sion of boats to use in coastal defense. Nineteen shrimping and lobster-
ing boats were lost as a result of contra seizures, fires, and sinking by
mines. The losses of fishing industry assets total $11 million through
1984 while the total worth of fish not caught is estimated at $34 million."
What is the overall picture of the damage of the war in its first five
years? Figures available to the author indicate that close to $525 million
in physical damage and production losses occurred between 1981 and
1985. When the figures covering loans denied to Nicaragua in the Inter-
American Development Bank and the World Bank and the effects of the
U.S. economic embargo are included, the total comes to $862 million.
(See Tables 4 and 5.) Figures are not available for 1986, but based on the
level of the 1986 fighting, it is likely the damage has surpassed $1 billion.
These figures are somewhat conservative and definitely lower than other
estimates that have been offered.
What has been the cumulative effect of this damage in a country
whose annual export earnings are now only $375 million? Nicaragua has
been running in the red for each of the years of the revolution. In 1985
the gap between export earnings and the import bill was $530 million.36
This annual gap has been filled by a combination of loans and grants,
mostly loans. Nicaragua's indebtedness has gone from $1.6 billion in
1979 to $5.0 billion at the end of 1985. Up till now Nicaragua has been
able to justify these debts by the productive use that has been made of the
borrowed money (approximately $1 billion for social programs and $1
billion in new productive projects ranging from geothermal energy pro-
duction to expansion of tobacco and sugar production). However, now it
has become necessary to divert government expenditures in larger
amounts to the war effort. In 1985 approximately 40% of the regular
government budget was spent on defense.37 Although the Nicaraguan
government has not significantly cut back on social services because they
represent the heart of the revolution, no new development projects were
begun in 1985, a prospect that will clearly slow the long-term develop-
ment of the country. Growth rates have already begun to slow down at
least partially as the result of the war and it will probably be very difficult
for Nicaragua to register significant economic growth if the war con-
tinues at its present level. In 1985 Nicaragua suffered a negative growth
rate of 2.5% after six years of nearly uninterrupted growth. 3 ' At his in-
augural in January 1985 President Ortega was sober about his country's
future, promising "beans and dignity." For as long as the war continues
against Nicaragua her primary task will be defense and the building of an
economy geared to that goal. Only with an end to the war, by whatever

17
Summer 1987

means, will Nicaragua be able to move ahead to attempt to fulfill all of

the revolutionary goals set at the time of the triumph in 1979.
This analysis should not imply that Nicaragua's economic woes and
particularly its export-import deficit are traceable exclusively or even
primarily to the effects of the contra war. Nicaragua's economy suffers
from long-term problems growing from lowered commodity prices in
agriculture and generally higher prices for imported manufactured
goods." At this point it is difficult to judge the prospects for bringing the
war to an end in the immediate future. On the one hand the Nicaraguan
government has gained the military initiative over the contras in the last
eighteen months, and the rebel forces are in some measure of disarray. It is
not clear that the rebels can recover from their current state to once again
constitute a major threat to the Nicaraguan government. On the other
hand, the Reagan administration remains committed to the downfall of
the Sandinista government and the maintenance of the contras as a viable
force. While the U.S. Congress has been reluctant to grant the monies re-
quested by the President for the contra they have increasingly moved
toward the sanctioning of the war effort by restoring so-called
humanitarian aid in June 1985 and then outright military assistance in
1986. It is not yet clear what the effect of the Iran-Contra scandal will be
on future Congressional funding, but a cutoff is not necessarily imminent
given the Reagan administration's undiminished commitment to the con-
tras. While neither the contra leadership nor the U.S. government may
have a clear strategy for attaining their mutual goal of removing the San-
dinistas from power it is the author's judgment that they will continue to
pursue their common goal for the foreseeable future. However, it is also
the author's judgment that the Nicaraguan government and its basic
revolutionary program will survive, unless the U.S. government chooses
the route of an invasion. If it is also true that the contra can be maintained
as a viable military threat then the Nicaraguan people are in for a prolong-
ed economic crisis with few new achievements possible.
TABLE 1
NUMBER OF VICTIMS OF THE ATTACKS AGAINST
NICARAGUA SINCE 1981, BY YEAR
Deaths Wounded Missing and Total
Kidnapped
1981 53 13 7 73
1982 114 52 91 257
1983 1,030 1,323 1,153 3,506
1984 1,339 1,302 1,085 3,726
1985 1,463 1,852 1,455 4,770
Total 3,999 4,542 3,791 12,332
Sources: Foreign Ministry, 1980-84, Barricada International, February
27, 1985, 1986

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 Conflict Quarterly

TABLE 2
THE NUMBER OF CLASHES BETWEEN SANDINISTA AND
COUNTER-REVOLUTIONARY FORCES

Year Number of Clashes

1981 15
1982 78
1983 600
1984 948
1985 1637
Total 3278
Sources: Nicaragua: The Counter-revolution — Development and
Consequences (Managua: Center for International Communication,
1985) and "June-December 1985: The Strategic Defeat of the Counter-
revolution (Managua: Center for International Communication,
February 1986).

TABLE 3
APPROXIMATE NUMBER OF CONTRA CASUALTIES 1981-1985

Year Dead Wounded Arrested Total

1981 40 — — 40
1982 337 — — 337
1983 1853 372 270 2495
1984 3017 596 197 3810
1985, first half 2006 306 128 2440
Total 7253 1275 595 9122
Source: Nicaragua: The Counter-revolution — Development and Con-
sequences (Managua: Center for International Communication, 1985).

TABLE 4
PHYSICAL DAMAGE AND PRODUCTION LOSSES
(IN MILLIONS OF DOLLARS)

Total 1981 1982 1983 1984 1985

Total 513.9 7.0 31.3 143.5 187.5 121.0
Physical Damage 108.2 2.7 9.0 41.1 16.1 15.7
Agriculture 10.1 — — 5.0 5.1 n/a
Lumber and Forestry 29.2 — — 24.1 5.1 n/a
Fishing 11.0 2.2 1.7 5.4 1.7 n/a
Mining 4.3 0.5 1.7 1.5 0.6 n/a
Construction 14.3 — 5.6 5.1 3.6 n/a
Services 23.6 — — — — n/a
Production Losses 405.7 4.3 22.3 102.4 171.4 105.3

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Summer 1987

TABLE 5
FINANCIAL COSTS OF THE WAR
(In Millions of Dollars)
1981 1982 1983 1984 1985 Total
Credit Denial (a) 8.2 38.3 61.3 92.1 73.0 272.9
Commercial Embargo (b) — — 11.7 15.0 50.0 76.7

(a) Credit denials by the Interamerican Development Bank and the

Third World.
(b) Embargo activities of the U.S. government.

Sources: CRIES, Managua, 1986.

Endnotes
1. For a detailed discussion of U.S. foreign policy during the insurrection and in the first
term of the Reagan administration, see William Leogrande, "The United States and
the Nicaraguan Revolution," in Nicaragua in Revolution, edited by Thomas W.
Walker (New York: Praeger, 1982), pp. 63-77 and Leogrande, "The United States and
Nicaragua," in Nicaragua - The First Five Years edited by Thomas W. Walker (New
York: Praeger, 1985), pp. 425-46.
2. Ronald Reagan, "Address to the U.S. Congress, April 27, 1983," in Central America
-Opposing Viewpoints (St. Paul: Greenhaven Press, 1984), p. 30-37.
3. Alexander Haig, quoted in Eldon Kenworthy, "Why the U.S. is in Central America,"
Bulletin of the Atomic Scientists, October 1983.
4. Honduras Update. (Somerville, MA: Honduras Information Center, September 1985),
p. 3.
5. Ibid.
6. William Keller and Joel Brinkley, "U.S. Military is Termed Prepared for any Move
Against Nicaragua," New York Times, June 4, 1985.
7. Affidavit of Edgar Chamarro, International Court of Justice, September 5, 1985.
8. For background on the conflict between the Nicaraguan government and indigenous
people of the Atlantic Coast see Phillippe Bourgois, "Ethnic Minorities," in
Nicaragua: The First Five Years, pp. 201-16.
9. "Who's Who in Nicaragua's Military Opposition," Nicaraguan Update, Central
American Historical Institute, January 31, 1986.
10. For a detailed description of contra atacks within Nicaragua from February 1982 to
June 1985 see Nicaragua: The Counter-revolution - Development and Consequences
(Managua: Center for International Communication, 1985).
11. James LeMoyne, "Most Contras Reported to Pull Out of Nicaragua, "New York
Times, January 28, 1986.
12. Stephen Kinzer, "Nicaragua Holds the Upper Hand in Guerrilla War," New York
Times, September 9, 1985.
13. "Who's Who in Nicaragua's Military Opposition."
14. James LeMoyne, "Contras in Pact Giving Civilians Great Power," New York Times,
May 28, 1986.
15. For an analysis of these events and this quote see James LeMoyne, "The Contra
Shake-up," New York Times, February 17, 1987.

20
 Conflict Quarterly

16. "Kisan: A Splintered Movement," Barricada International, May 22, 1986.

17. "Who's Who in Nicaragua's Military Opposition," p. 10.
18. Associated Press, "CIA Role Reported in Contra's Fall," New York Times, May 30,
1986.
19. Figures for 1981-84 are provided by the Nicaraguan Foreign Ministry and appeared in
48 Months of Foreign Aggression—1982-84, (Managua: Ministry of Social Welfare).
1985 figures appeared in Barricada International, February 27, 1986 from a speech by
President Daniel Ortega to the Nicaraguan National Assembly on February 21, 1986.
20. Figures for 1981-84 are from Nicaragua: Nicaragua: The Counter-revolution—Devel-
opment and Consequences (Managua: Center for International Communication,
1985). 1985 figures are from "June-December 1985: The Strategic Defeat of the
Counter-revolution," (Managua: Center for International Communication, February
1986.
21. Ibid.
22. 48 Months of Foreign Aggression—1982-84 (Managua: Ministry of Social Welfare,
1985).
23. Barricada International, February 27, 1986, p. 2.
24. 48 Months of Foreign Aggression—1982-84.
25. Figures from CEPAD quoted in Nicaragua: The Counter-revolution—Development
and Consequences (Managua: Center for International Communication), p. 21.
26. Ibid.
27. Ibid., p. 22.
28. Interview with FSLN Regional Director, Ocotal, January 19, 1985.
29. Speech by Daniel Ortega, "We've Won the Battle for Coffee," Barricada Interna-
tional, March 21, 1985.
30. Nicaragua: The Counter-revolution—Development and Consequences, p. 23.
31. 48 Months of Foreign Aggression—1982-84.
32. Nicaragua: The Counter-revolution—Development and Consequences, p. 22.
33. Ibid., p. 19.
34. Ibid., p. 22.
35. Barricada International, February 13, 1986.
36. Ibid.
37. Barricada International, March 27, 1986.
38. For a more complete review of Nicaragua's current economic situation, see Rose
Spalding, The Political Economy of Revolutionary Nicaragua. (Winchester, MA:
Allen and Unwin, 1986.

21