By 1952 the Bolivian economy had deteriorated even further. The governments of the sexenio had been reluctant to increase taxes for the upper class and to reduce social spending, resulting in high inflation. The tin industry had stagnated since the Great Depression, despite short revivals during World War II. Ore content had declined, and the richer veins were depleted, increasing tin production costs; at the same time, tin prices on the international market fell. A disagreement with the United States over tin prices halted exports temporarily and caused a decline in income that further hurt the economy. The agricultural sector lacked capital, and food imports had increased, reaching 19 percent of total imports in 1950. Land was unequally distributed--92 percent of the cultivable land was held by estates of 1,000 hectares or more.
The social unrest that resulted from this economic decline increased during the last weeks before the 1952 Revolution, when a hunger march through La Paz attracted most sectors of society. The military was severely demoralized, and the high command called unsuccessfully for unity in the armed forces; many officers assigned themselves abroad, charged each other with coup attempts, or deserted.
By the beginning of 1952, the MNR [Nationalist Revolutionary Movement (Movimiento Nacionalista Revolucionario--MNR)] again tried to gain power by force, plotting with General Antonio Seleme, the junta member in control of internal administration and the National Police (Policía Nacional). On April 9, the MNR launched the rebellion in La Paz by seizing arsenals and distributing arms to civilians. Armed miners marched on La Paz and blocked troops on their way to reinforce the city. After three days of fighting, the desertion of Seleme, and the loss of 600 lives, the army completely surrendered; Paz Estenssoro assumed the presidency on April 16, 1952.
Although outlawed in Bolivia in 1946, the Movimiento Nacionalista Revolucionario (MNR), or National Revolutionary Movment, continued to have many thousands of Bolivian adherents who demanded land reform, control of the rich tin-mining industry, and justice. In the Bolivian presidential elections of 1951, the MNR won a plurality victory with its candidate Victor Paz Estenssoro (1907-), founder and leader of the MNR and former professor of economics, who was in exile in Argentina. The government claimed Estenssoro did not have the required majority and the president must be chosen by the congress. In order to prevent the MNR from coming to power, Bolivia's outgoing president resigned and turned the government over a 10-man military junta, whose rule was anathema to many. On April 8-11, 1952, a popular revolt occurred in La Paz, Bolivia's administrative capital, and elsewhere; the MNR, supported by armed workers, civilians, and peasants and the national police, overthrew the military junta and recalled Paz Estenssoro from exile to take the presidency. As president he did what he said he would do: nationalized the tin-mining industry, raised miners' wages, liquidated the vast holdings of powerful landholders, and distributed acres to landless Indians. Universal suffrage was granted, but Paz Estenssoro was ruthless to his political foes, many of whom he imprisoned. In one of Latin America's major revolutions, Bolivia had "suddenly broken loose from the chains of serfdom," and its people, especially the Indians, had gained civil and political rights which subsequent governments would have to recognize.