Scholars and US officials mocked Juan José Arévalo Bermejo, the first democratically elected president of Guatemala (1945–51), for the opacity and alleged incoherence of his “spiritual socialism.” He was eclipsed by his successor, Jacobo Árbenz Guzmán, who introduced sweeping land reform to Guatemala and whose overthrow in a CIA-orchestrated coup in 1954 launched the Latin American Cold War. But Arévalo's ideology is not only decipherable but potentially of great value—when we trace its origins back to Karl Christian Friedrich Krause, a forgotten philosopher who was Hegel's contemporary, and the Argentine intellectuals who developed Krause's abstract theories into an approach to governance that shaped Argentina's experience in social democracy under Hipólito Yrigoyen, while Arévalo was living in exile there. Arévalo's social reforms, which improved the standard of living for workers and peasants without sacrificing individual liberties or property rights, reflect a Krausean philosophical commitment to harmonious nationalism based on ethical relationships rather than hierarchies. The experiment was foreclosed by the 1954 coup and a lesser known, US-backed coup in 1963 that denied Arévalo a second term in office. This analysis of Arévalo's writings and governing practices shows their relevance to Latin America's search for a third way between revolutionary class struggle and neoliberal authoritarianism.