In the Gray Zones: States of Shining Path

Abstract

As Shining Path began to focus its organizing efforts on Lima after 1988, Peru’s overall political, social, and económic situation was deteriorating dramatically. Though García’s heterodox económic experiment was an initial success, by 1988 it had collapsed under the weight of foreign exchange constraints and looming government deficits. Spiraling hyperinflation—1,722 percent in 1988 and 2,775 percent in 1989—forced a sharp decline in real wages and a 25 percent contraction of the económy between 1988 and 1990 (Pastor and Wise 1992). This provoked massive labor unrest and seriously weakened the government’s fledgling legitimacy. The process of state decomposition that followed the económic fiasco, and the consequent decline of public services, the drying up of social programs and the disengagement of the state from society, caused major discontent. Political violence was growing and expanding into new areas, adding to the sensation of a situation gone out of control.