A general election was held in Honduras on 10 October 1954. The elections took place, with relative honesty.
The split among the Nationalists enabled the Liberals to win a plurality (48 percent) in the national elections, but without an absolute majority the election was thrown into the National Congress, where the distribution of seats favored the Nationalists and the MNR.
The Nationalists and Reformists, unable to concur on a candidate of their own, had agreed to block Ramón Villeda Morales.
In November the election was thrown into Congress. “Unfortunately, two-thirds of the deputies was necessary to constitute a quorum and when the National and Reformist deputies boycotted the proceedings (in a ploy designed by US Ambassador Whitting Willauer), a stalemate ensued”.
In the midst of this crisis, President Juan Manuel Gálvez, stricken by illness, turned over the power of the presidency to his vice-president.
On 16 November 1954 Vice President Julio Lozano Díaz assumed the presidency during a constitutional crisis occasioned by an anarchic election. His ostensible purpose was to save the country from descending into chaos. Once in power, however, he decided to stay there.
Owing to the failure of Congress to agree on a winner, the country seemed about to plunge into a civil war, which no one wanted. Thus there was almost relief when, on 6 December, Lozano moved decisively, declaring himself dictator. It was the same old story of someone assuming strong-man rule in order to avoid the imaginary ‘chaos’ that would result from democratic rule. Soon Lozano even uncovered the obligatory ‘communist plot,’ allegedly backed by Guatemalan ex-president Juan José Arévalo, which allowed him to tighten the screws even more. Villeda and other Liberal leaders were exiled from the country.
President Lozano, asserting his independence, dissolved congress and appointed a State Advisory Council (59-member) with representatives from the Liberal, National, and MNR Parties. It was to write a new constitution, labor code, social security law, and act merely in an advisory capacity to the president.