Juan Velasco Alvarado of the Velasco administration's economic policies is still debated today. As the Peruvian military government ran deeper into debt, it was forced to devalue the currency and run inflationary policies. This however, was in part due to the 1970s Energy Crisis, which also affected Peru and made it impossible for the Velasco administration to fund some of its most ambitious reforms. In foreign policy, in contrast with his 1970s Latin American contemporaries, which were mostly right-wing military dictatorships, he pursued a partnership with the Soviet bloc, tightening relations with Cuba and Fidel Castro and undertaking major purchases of Soviet military
Juan Bautista Alvarado a new flag—a single red star on a white background, but neither were used after Alvarado made peace with Mexico. Alvarado, at age 27, was then appointed governor, but the city council of Los Angeles protested. Alvarado, Castro, and Graham went south and negotiated a compromise after three months, avoiding a civil war. However, the city council of San Diego then voiced its disagreement with Alvarado's revolt. This time, the Mexican government was involved and there were rumors that the Mexican Army was ready to step in. Alvarado was able to negotiate another compromise to keep the peace. Mexico reneged