The Independent Socialist Party (Spanish: Partido Socialista Independiente, PSI) was founded in March 1938 by Víctor Paz Estenssoro, Carlos Salamanca, Jorge Aráoz Campero, Carlos Montenegro and Augusto Céspedes, following a split in the United Socialist Party.
[1] Independent Socialist Party was created by a radical sector and was “the advocate economic nationalism and are in favor of controlling foreign capital, and its re-investment in Bolivia”.
Many of the PSI's founders were student activists, war veterans, and journalists of the middle class.
[4] The Independent Socialists elected some deputies of National Congress in 1940, and during Enrique Peñaranda del Castillo's administration they were among the government's opponents in parliament.
[5] In 1941 the Socialistas Independientes decided to form a more massively based political party, the Revolutionary Nationalist Movement.