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The paper presents a political economy analysis of the Habyarimana regime in Rwanda. The analysis shows how, through the producer price of coffee, the dictator buys political loyalty from the peasant population, and how, in periods of economic growth, the dictator increases his level of personal consumption as well as power over the population. The analysis of Habyarimana’s policy decisions leads to the conclusion that he was a totalitarian type of dictator. When, at the end of the 1980s, the international price of coffee fell dramatically, the regime switched to severe forms of repression to maintain its hold onto power. Genocide emerges as an outcome of Wintrobe’s loyalty-repression model, while foreign aid sustained the dictator’s hold onto power.