Three army commanders join navy plot to block socialized economy

By Desmond Okafor · August 9, 2026

Navy dissidents and industry leaders plotted to overthrow a government leaning toward the working class, sparking student riots and the machine-gunning of a former minister's home.

The political atmosphere in Lima on March 10, 1976, was a "bubbling pot." According to Telegram 2314 from the Embassy in Peru to the Department of State, the city was vibrating with rumors of a military coup, a tension catalyzed by a clash between a revolutionary government and a coalition of navy officers, private industry, and political dissidents. At the heart of the friction was a document that threatened the status quo: the preliminary draft of Plan Tupac Amaru.

"Radical in Content and Tone"

The diplomatic cable identifies the "preview of GOP Plan Tupac Amaru" as a primary driver of the unrest. To the observers in the embassy, the draft was "radical in content and tone," sparking what they termed a "perceived leftward governmental drift" under the regime of Francisco Morales Bermúdez. This perceived drift was not merely a matter of rhetoric; it represented a systemic attempt to consolidate a revolutionary process that prioritized labor and the state over the interests of the owning class.

This shift sent shockwaves through the Peruvian military. The record indicates that dissident officers, centered primarily in the navy, were "disturbed" by the government's direction. These dissidents were not operating in a vacuum; they were allegedly supported by a significant number of army and air force officers. The cable notes that three regional army commanders were in contact with these navy dissidents, suggesting a fracture within the armed forces that went deeper than a few disgruntled captains. The tension reached a peak in Arequipa, where General Sanchez, Commander of the Third Region, allegedly had his "ears pinned back" by the ruling junta following his mismanagement of a general strike. While the embassy could not confirm the specific discipline of General Sanchez, they noted a clear split within the Cabinet over how to handle the labor unrest.

Private Industry and the Navy

The alliance against Morales Bermúdez was not limited to the barracks. The cable details a concerted effort by the private business community to stall the government's trajectory. An official from the Peruvian Society of Industries told embassy staff that his organization—joined by the Automobile Manufacturing Association and various Chambers of Commerce—was stepping up its activity because business groups had concluded that the regime "intends to proceed toward a socialized economy."

For the industrialists, the window for influence was closing. They viewed the current moment as their "last opportunity to alter that course." This panic manifested in a symbiotic relationship with military plotters; an air force colonel reportedly approached the Society of Industries to request that they continue pressing for modifications to economic policy.

Parallel to this industrial lobbying was the involvement of the APRA party. The embassy record states that APRA was "involved in whatever plotting is taking place" and was said to "support fully with its civilian force" the efforts of the navy and other military dissidents. It was a convergence of old-guard political power and corporate capital, both terrified by a government that dared to lean toward the working class.

Arequipa and the Machine Guns

By early March, the instability had spilled into the streets. On March 5, serious student rioting broke out in downtown Lima, resulting in the death of one student. On that same day, the home of Admiral Jose Arce Larco, a former Navy Minister and Ambassador to the U.S., was machine-gunned. While no injuries were reported, the event added to the weekend's volatility. Arce Larco, a man the embassy notes remained "extremely unpopular with navy officer corps," suggested the attack could have been the work of the CIA.

Amidst this chaos, the government attempted to maintain control through a mix of concessions and firmness. The Arequipa general strike was settled on March 5 through various concessions to the unions—a move that likely further infuriated the dissident navy officers and the industrialist class who viewed such concessions as a surrender to "leftward drift."

The U.S. embassy’s assessment of the situation was one of cautious skepticism. Despite the "spate of rumors," the Ambassador concluded that the coup plotting was too widely discussed on the "Lima rumor circuit" to be a credible, imminent threat. The cable suggests that the chatter may have been intended as a "warning" to Morales Bermúdez rather than a serious attempt to seize power during the predicted window of March 7–15.

Related records regarding this era exist in other archives, including several files from the U.S. District Court for the Northern District of Illinois held by the NSArchive, and further diplomatic correspondence in the State Department's FRUS series, including a letter from President Carter to Morales Bermúdez and telegrams detailing the embassy's observations from 1969 to 1976.

The embassy continued to analyze the government's trajectory as the situation evolved. The record concludes by noting that the Embassy had acquired a February 5 draft of Plan Tupac Amaru, which called for a pro-labor domestic policy, a more activist state, and a Third World agenda in foreign policy.