SPECIAL REPORT: REBEL HELD

THE FUTURE: PEACE OR WAR

With negotiations between the government and the rebels at a virtual
standstill, some analysts say the region is headed for a military showdown.
With help from the United States, the Colombian army has beefed up its
ranks. But the FARC won't give up easily. Although the president is pushing
for peace, the war rages, making many Colombians question why the
government even bothers to talk with the guerrillas.

LOS POZOS, Colombia -- In an open-air thatched hut furnished with a
water cooler and a white plastic table, four guerrillas huddle with
six delegates of the Colombian government.

The rebels, members of the FARC, or Revolutionary Armed Forces of
Colombia, wear camouflage uniforms and sling AK-47 rifles over their
shoulders. The civilians wear khaki pants and carry ballpoint pens in
the pockets of their brightly colored golf shirts.

For 21/2 years, the negotiating teams have been meeting in this speck
of a village in a rebel-held zone in southern Colombia in search of
the elusive formula that might end nearly four decades of civil war.

"The atmosphere is very friendly and informal," says Alfonso Lopez
Caballero, who served as a government negotiator until last month.
"There are a lot of jokes and camaraderie."

Just a few hundred yards from the hut, however, FARC drillmasters run
a dozen raw recruits through a jungle obstacle course. As the
bare-chested teen-agers hurdle tree trunks and trot in unison through
the woods, they chant: "We are guerrillas, sons of the people.

"And we are not content with this evil government."

Like a split screen on television, the dual undertakings at Los Pozos
paint disparate images of Colombia's future: an even bloodier and
protracted war, peace after arduous negotiations or some tangled
combination of the two.

The nation has reached a crucial juncture, with thousands of lives
hanging in the balance. But although the framework to make peace is in
place, it's unclear whether the two sides will seize the day.

President Andres Pastrana has made peace his top priority. But
analysts say the process has been so frustrating and the payoff so
paltry that many Colombians have lost faith in the
negotiations.

One of the main aggravations is that even as the delegates talk peace,
the war rages. Whenever the FARC attacks a town or kidnaps civilians,
outraged Colombians demand a military response and question why their
government bothers with the meetings.

"I've never seen people so fed up with the peace process," says Rafael
Pardo, a former Colombian defense minister.

Although the talks began in January 1999, the two sides have yet to
address the 12-point negotiating agenda.

Many experts say factions within the FARC and even the government
believe they have more to gain on the battlefield than at the
negotiating table. So, conditions may not be ripe for successful talks.

With the help of $1.3 billion in U.S. aid, the Pastrana administration
is overhauling the Colombian armed forces. After a string of military
defeats in the late 1990s, the army is performing better against the
rebels, while illegal right-wing paramilitary groups are rolling back
many FARC gains in the countryside.

The guerrillas talk of doubling in size, building up their urban
militias and laying the groundwork for a general uprising.

"The war has yet to be played out," says Alfredo Rangel, a political
analyst and an adviser to the Colombian Defense Ministry. "Both sides
are building up their forces for an eventual military showdown."

Still, most experts believe that neither the government nor the
guerrillas can score an outright victory in the next few years and
that the smart thing would be to cut a deal sooner rather than later.

What's more, they say, an accord with the FARC could lead to the
demobilization of the paramilitaries.

"It's very easy to call for total war, but that would destroy any
possibility of a future for this country," says Magdalena Vasquez, a
member of a national commission set up by the government to support
the peace process. "If we do not learn to negotiate, we will continue
to promote this illusion that warriors can be our saviors."

If the talks ever turn to the actual agenda, the two sides might find
plenty of room for compromise. Even conservative businessmen say the
FARC's demands at the negotiating table are not especially radical.

"If you look at the guerrillas' agenda, there are a lot more things
that we agree on than we disagree on," says Eugenio Marulanda,
executive director of the Colombian Federation of Chambers of Commerce.

So far, the peace talks have consisted of a series of informal
conversations, usually about peripheral and procedural issues such as
prisoner exchanges and the dates of the next round of meetings.

Sometimes, the teams seem to be speaking separate languages.

When discussing a possible cease-fire, for instance, the government
calls the guerrilla practice of kidnapping civilians a "hostility"
that must end. The FARC, in turn, considers the government's failure
to guarantee decent living conditions to millions of poor Colombians a
"hostility" that has to stop.

Both sides have periodically walked out on the talks for months on
end.

"We could go on like this forever," says Lopez Caballero, the former
government negotiator.

Daniel Garcia-Pena, a Colombian peace activist, sees the impasses as a
sign that neither side is serious about meaningful
concessions.

"For the government, that would mean taking away privileges and
cleaning up the army, and they are having second thoughts about it,"
Garcia-Pena says. "For the guerrillas, it's a sense of: 'Oh my God.
Are we really going to have to give up our guns? Is this really the
moment?'"

What The FARC Wants

It was called casa, carro y beca, Spanish for
house, car and scholarship. The informal phrase summed up what was
once the Colombian government's modus operandi for dealing with guerrillas.

The approach amounted to a low-cost peace initiative. By offering
rebels housing allowances, academic grants and a smattering of state
jobs, the government, over the years, persuaded several small
guerrilla groups to disband.

Few people, however, believe the same approach will work with the
FARC. Because of the rebel organization's military strength and
staying power, many analysts predict that the FARC can, and will, hold
out for much more.

"Is peace possible? Not without yielding up a real share of power" to
the rebels, says Bruce Bagley, a leading expert on Colombia at the
University of Miami.

But what does the FARC want?

If the rebels ever manage to seize power, many analysts speculate,
they would set up an authoritarian state along the lines of Fidel
Castro's regime in Cuba.

But their proposals at the negotiating table sound little like The
Communist Manifesto despite their fulminations about Marxism. The
guerrillas are not calling for the disappearance of the bourgeoisie
or, as Vladimir Lenin once did, for every cook to learn how to govern
the state.

"The FARC accepts a market economy, foreign investment and private
property," says Camilo Gonzalez, director of Mandate for Peace, an
independent Bogota group. Referring to the late French president, he
adds: "The agenda of Francois Mitterand in his first government is
more radical than the FARC's program."

Ivan Rios, a longtime FARC commander and an adviser to the guerrilla
negotiating team, says the rebels want higher taxes for the rich and
reforms that would put more land in the hands of peasants. They demand
that half of the national budget be spent on education, health and
social welfare programs.

The FARC wants more protection for Colombian farmers and industry
through higher tariffs on imports. Rios says the rebels also would
like foreign oil companies to give a greater share of their profits to
the Bogota government and for the state to regulate the media.

Still, many analysts believe that the FARC has little interest in
ideology or the nuts-and-bolts minutiae of governing. What the FARC is
really after, they say, is a slice of the nation's political and
economic spoils.

According to Malcolm Deas, a Colombia expert at Oxford University, the
fact that the FARC has survived for two generations is part of its
political capital and will have to be recognized at the negotiating
table.

A truce with the FARC will require conditions under which demobilized
fighters can win elections, Bagley says. It will mean transferring
more government money to forgotten rural areas dominated by the FARC.
It will require security guarantees to rebels if they disarm and the
removal of accused human rights violators from the armed forces.

"Those who are going to have to lose power in this process are those
who have historically governed this country," says Simon Trinidad, a
FARC negotiator.

Because surveys regularly show that less than 5 percent of Colombians
support the rebels, some question whether the FARC has any right to
negotiate with an elected government.

But opinion polls also show that most people are fed up with the
government's seeming inability to police itself and carry out
meaningful reforms.

Official efforts to clamp down on state graft, open up the electoral
system to small parties, clean up the scandal-plagued Congress,
improve the judicial system and develop backward rural areas have been
only partly successful or have been waylaid altogether.

A recent editorial in the influential Bogota newspaper El Tiempo
suggested that government corruption may be causing more damage to
Colombia than the fighting.

Many commentators point out that in nations with dysfunctional
governments, peace negotiations can provide a historic opportunity to
address the broad demands of society. The FARC's low poll numbers,
they say, is no excuse to derail what could be a cathartic process of
national renewal.

Or, as one observer who asks to remain anonymous puts it: "The fact
that the rebels are SOBs does not take away from the fact that we need
land reform."

The War Option

With his black beret, bushy mustache and bellicose persona, Jorge
Briceno has become an icon of the war to many Colombians.

Briceno -- better known by his nom de guerre, Mono Jojoy -- joined the
FARC as a teen-ager. Thanks to his battlefield prowess, he quickly
rose to become the rebel organization's top military strategist and a
member of its ruling secretariat.

In his 50s, Briceno is viewed as a possible successor to 71-year-old
FARC leader Manuel Marulanda. That's why a diatribe Briceno made to
midlevel guerrilla commanders caused such a stir when it was reported
by the Colombian media earlier this year.

"We are not going to sign any peace pact," Briceno said in the speech,
a copy of which was obtained by Colombian army intelligence. "We are
fighting for national power, to strip it away from the oligarchy and
to put you in their place to rule."

His words seemed to confirm what many Colombians had long suspected:
The FARC has no intention of engaging in serious negotiations, at
least not soon.

Because the FARC earns millions of dollars annually by taxing the
illegal drug trade, kidnapping civilians for ransom and extorting
businesses, many observers believe that the rebel organization is
prepared to continue fighting for years.

"FARC leaders can afford to be patient," says a recent report on the
Colombian conflict by the Rand Corp., a public-policy think tank in
Santa Monica, Calif.

"As long as they believe that military trends are running in their
favor and that they may be able to win a military victory or at least
dictate the terms of the peace, the FARC will have little incentive to
settle," the report says.

Ironically, the peace talks have given the rebels a degree of
visibility and credibility that could attract more recruits, says
Rangel, the Defense Ministry consultant.

He says the FARC wants to expand from 17,000 to 35,000 troops over the
next five years and to slowly encircle and squeeze off Colombia's
major cities.

The guerrillas, Rangel says, are counting on an economic depression,
growing disgust with the government and the polarizing specter of U.S.
military intervention to provoke a wider uprising.

Maj. Jorge Maldonado, a commander with the Colombian army's
anti-terrorist unit, says the FARC may eventually try to take the war
to the cities and sow chaos by detonating car bombs and assassinating
key political leaders.

The FARC has an estimated 5,000 urban guerrillas throughout
Colombia.

"Today, the possibility that the FARC could take power isn't very big.
But conditions could change," says Carlos Franco, a former leader of a
now-defunct guerrilla group called the People's Liberation Army, or
EPL.

"If there was an economic crisis much deeper than the one we have
today, people might begin to view the FARC as an option," he says.

But unlike Peru's Shining Path, a rural-based guerrilla group that
staged terror campaigns in Lima and other cities a decade ago, some
experts say the FARC lacks the discipline, the ideological fervor and
the support for a sustained urban war.

"The FARC is a completely leaky vessel that has none of the
organizational structure or cleverness of the Shining Path," says
Simon Strong, a British security consultant who has written books on
the conflicts in Peru and Colombia.

Rather than expanding its territorial control, Strong says, the FARC
will have its hands full defending its own back yard.

Over the past three years, the FARC's enemies have grown stronger,
evening the balance of power on the battlefield and forcing the rebels
to switch tactics.

Unlike the late 1990s, when the FARC was massing up to 1,000 rebels at
a time to overrun towns and military bases, the guerrillas have
returned to more traditional hit-and-run tactics, says Gen. Jorge
Enrique Mora, Colombian army chief.

The tactical retreat, Mora says, followed a series of army reforms,
such as the installation of new leaders, improved intelligence and a
program to replace unmotivated draftees with well-trained professional
soldiers.

One cornerstone of the government's strategy involves cutting off the
FARC's money supply by wiping out opium and coca crops, the raw
materials for heroin and cocaine. A cash-poor guerrilla group on the
defensive, Mora maintains, is more likely to engage in serious peace
talks.

All of this is being carried out with the help of $1.3 billion in U.S.
aid, most of which consists of helicopters and troop training.

"The war has changed for the FARC," Mora says, "due to the changes in
the armed forces." Others credit the shift in momentum to the
increasing strength of the paramilitaries.

Because of funds from the illegal drug trade and donations from
landowners, the paramilitaries are expanding even faster than the
guerrillas. A decade ago, the paramilitaries numbered 1,100 fighters
compared with 8,100 troops today. Through a campaign of military
assaults and dirty-war-style assassinations, they have pushed the
guerrillas out of several longtime strongholds.

Analysts say that it may be extremely difficult for anyone to crush
the FARC. Even if anti-narcotics operations put a dent in the rebels'
income, they appear to have the wherewithal to survive for many years.

Last year, the FARC snatched 1,203 people and collected millions of
dollars in ransom payments. The organization also earned at least $125
million by extorting major businesses, according to the Colombian government.

"Money has never been a big problem," says Walter J. Broderick, a
former priest who has written two books on Colombia's rebel groups.
"And if you've got money, you can buy arms and recruit people."

Possible Resolutions

Although Colombia's conflict has been notoriously unpredictable, the
Rand report speculates that the war could take a number of twists,
including the following:

The FARC seizes power and sets up a Marxist state.

The fighting degenerates into a struggle between the paramilitaries
and the FARC, and the government withdraws to major cities. Armed
groups take control of the rest of the country.

The FARC becomes so powerful that it manages to win a peace accord
that heavily favors the rebel group. Such a deal might include a
coalition government or leave the rebels in control of parts of the
countryside.

The Colombian government adopts a dirty-war strategy, emulating Peru's
tactics against the Shining Path in the early 1990s that led to the
near-annihilation of the rebel group. Human rights concerns are put on
the back burner, negotiations with the FARC end, and state security
forces wage all-out war against the guerrillas.

The Colombian military gains the upper hand and establishes control
over the countryside. This could create conditions for a peace
agreement in which the FARC disarms in return for security guarantees
and participation in the political system. It could also lead to a
ferocious, last-ditch offensive by the guerrillas, including attacks
on Bogota.

In order for serious peace talks to begin, many experts say the war
will have to reach the point of a "hurting stalemate," a situation in
which so much blood and treasure have been lost that the government
and the rebels are desperate for a truce.

So far, most of the fighting has taken place in remote jungle and
mountain regions. As a result, says one Bogota-based diplomat, many of
the nation's political and economic power brokers have yet to feel the
full effects of the war.

"Here, you are not anywhere near a hurting stalemate," the diplomat
says.

Some analysts say the best chance for immediate progress toward peace
could involve cutting a deal with a much weaker Marxist rebel group
called the National Liberation Army, or ELN. Such a truce could
provide momentum for the ongoing negotiations with the FARC, they say.

The ELN, which has about 3,000 fighters, is pressing the government to
establish a 1,775-square-mile demilitarized zone in southern Bolivar
state in exchange for starting peace talks.

But in recent months, paramilitaries have moved into the proposed zone
to kill some of the ELN's civilian supporters. Government security
forces have failed to stop the bloodshed.

The setback has raised doubts among FARC leaders over whether
President Pastrana would have the political capital to enforce a peace
accord with them.

"How are they going to provide us with guarantees for our survival?"
asks FARC negotiator Joaquin Gomez.

Some observers suggest that a series of recent prisoner swaps between
the FARC and the government could lead to other humanitarian accords
and a cease-fire, paving the way for an eventual peace treaty.

Experts say a truce with the FARC could transform the
nation.

For one thing, it would likely lead to the demobilization of most of
the paramilitaries, who took up arms in the 1980s in response to the
growth of guerrilla groups. Despite the FARC's objections, many
analysts say, the paramilitaries eventually will have to be brought
into the peace process.

Anne Patterson, the U.S. ambassador to Colombia, says peace could lead
to an economic renaissance. The fighting has shaved up to 5 percent
from the country's annual economic output and has scared off foreign
investors and tourists.

Ending the war is also essential to a successful crackdown on the
illegal narcotics industry, because huge plantations of coca and opium
poppies are located in FARC-controlled areas, says Bagley, of the
University of Miami.

Colombia supplies 90 percent of the cocaine and most of the heroin
sold in the United States. Although many observers find their claims
spurious, FARC leaders say they would support programs to help drug
farmers switch to legal crops if a peace accord is reached.

Adam Isacson, a Colombia expert at the Center for International Policy
in Washington, believes the Bush administration could play a more
constructive role in the peace process.

U.S. officials, who consider the FARC a terrorist group, have kept
their distance from the talks and have refused to take part in
informal meetings between the rebels and international diplomats at
Los Pozos.

"The Americans say they support the peace process, but they don't go
any farther than that," Isacson says. "At the same time, they are
pouring in all this military aid. The message is pretty obvious."

As the war grinds on, there is a growing sense that the clock is
ticking for all sides.

Some analysts believe that FARC leader Marulanda, who is viewed as the
glue that holds various rebel factions together, may want to have an
accord signed before he dies.

"If you lose Marulanda, the FARC becomes a series of fronts competing
for dominance," the Bogota diplomat says. "So there's a certain
impetus to see this peace process culminate with Manuel Marulanda
there to sign the paperwork."

Pastrana, in turn, would like his peace policies to pay off before his
four-year term expires next August.

He often appears desperate for progress. To revive the talks, he has
twice flown deep into rebel-held territory to meet with Marulanda.

Marco Palacios, a political science professor at the National
University in Bogota, points out that, in the past, each Colombian
president came up with his own peace initiative rather than forging a
bipartisan policy that could be handed down to the next government.

Despite criticism of Pastrana's efforts, the main candidates in next
May's presidential election appear willing to continue peace talks in
some form.

"I think that Pastrana's big contribution is that he is able to give
his country an irreversible peace process," says Jan Egeland, a
special U.N. envoy to Colombia.

Others fear that both sides may be blowing a historic
opportunity.

"If the peace process sinks, Pastrana is not the only one who will go
down with it. The FARC will go down with it as well," says
Garcia-Pena, the peace activist. "Because, rightly or wrongly, history
will say that Pastrana did everything he could and that it was the
FARC that didn't want peace."