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Resolution of Guatemala's internal conflict is crucial to the future of Central America. Guatemala is the region's wealthiest and most populous nation. Its economy boasts a disproportionate share of the region's limited industrial capacity, and its economic health is crucial to the area's entire trade structure. The continuing decline in US influence over 1981 and the early part of 1982 reflected the unwillingness of the Reagan administration to risk congressional support for other Central American policies by requesting military assistance for the Lucas regime whose abuses of human rights had become notorious. In the countryside, repression won friends for the guerrillas, and in the cities corruption and rampant violence alienated important middle-class constituencies. Internationally, the regime had become a pariah. The Reagan administration found itself in a no-win situation.