Peru's hostage crisis comes just as Peru's middle class was beginning to realize their own version of the American dream for the first time in more than a generation. Talking to family and friends in Lima after three years in the U.S., PNS associate editor Andres T. Tapia hears of major changes, sees much that is unchanged, and finds that the seizure of the Japanese ambassadors' residence by Tupac Amaru members raises vital questions about who gains and who loses if Peru stays on its present course. Tapia, who was raised in Peru, covers religion for Christianity Today.

LIMA -- "They are not guerrillas, they're terrorists!"

We are on the terrace of a penthouse apartment, a little more than a mile from the Japanese ambassador's residence where Tupac Amaru members are holding 74 Peruvian and foreign dignitaries hostage. Some high school classmates are trying to convince me that I'm out of touch with the new Peruvian reality after three years away.

"You are still seeing Peru in terms that simply don't fit anymore," says one of my classmates, Guillermo Palomino, a business executive. "Money has been pouring into the country and Fujimori has built thousands of kilometers of new highways and is building a new classroom every day. These changes are going to help all Peruvians. But not overnight."

"All Peruvians." The phrase stays with me as I wonder if the dark-skinned and destitute 75% of the population will be able to wait.

Certainly, Lima has changed dramatically. Many Peruvians credit Alberto Fujimori's economic liberalization policies for the surge of foreign capital into the country -- for the many beautiful new five-star hotels and shiny bank buildings that preside righteously over Lima's cluttered skyline. Hilton International is about to break ground on a $47.5 million resort. "Lima has become one of the gaming capitals of Latin America," says Cesar Rios of the Lima Sheraton Casino as he proudly shows off the hotel's Las Vegas-style gaming room.

But in many ways Lima is the same. Street vendors are staked out at every red light hoping they can sell drivers enough trinkets and hard candy to feed their families that night. There is a recession -- jobs are scarce, prices high. And the poor people who line up with their buckets by water trucks to purchase their potable water for the day are still waiting for trickle down economics to trickle down to them.

This seemingly unmovable reality about Peru, that the poor will always be with us in great numbers, fuels causes like that of the Tupac Amarus. But if I raise this issue, the Peruvian middle class chorus retorts "What is the alternative?"

We are all familiar with the alternatives that failed. A military junta that ruled from 1968 - 1990 left Peru saddled with a debt it is still paying back. Alan Garcia's reckless confrontation with the international banking community led to a five-year cumulative inflation rate of 1 million percent.

As for the armed revolutionaries, Shining Path went about killing popular leaders, which alienated the constituency they said they were fighting for. And few Peruvians in any walk of life feel the Tupac Amarus offer a realistic blueprint.

All our lives, my middle-class generation has assumed we were to be deprived of the Peruvian version of American dream. But now, eight years into the Fujimori administration, it seems within reach. No need to go to Miami to shop -- you can stay in Lima and watch BlockBuster videos while eating cellular phone-ordered Domino's pizza. "You should see how beautiful it is to see all those gringos walking the streets of Lima again," Palomino e-mailed me before my arrival.

But the crisis has put Peru's economic recovery on hold. "Before the takeover I had Chilean investors ready to buy commercial property to set up new gas stations," says a real estate agent, "but now they tell me, 'Don't call us till this thing is over."'

The poor of Peru are also likely to lose from a drop in tourism, which has been rising 20% per year. Many admit they relish the idea of the masters having to sleep on floors, share a bathroom with dozens, and take turns cleaning the toilet, but some say they are still waiting patiently for Fujimori's promised tide that lifts all boats.

I myself am caught. I challenge my friends and family at the beach as a seafood vendor unloads our car, sets up umbrellas and chairs, brings beer and ceviche -- even fills the kids' inflatable pool with water.

The Tupac action most threatens those who have reaped the benefits from the recovery -- the upper and middle classes. We wanted to believe Fujimori when he said he had defeated terrorism -- as if jailing key leaders would eliminate the hunger of the poor after centuries of social injustice. But as long as we continue down the path of unbridled capitalism, we too will be hostages -- long after the Tupac hostage crisis has been resolved.