>Terry, I think you are thinking of Paraguay, which lost almost 2/3 of the population in the war against Argentina, Brazil and Uruguay (War of the Triple Alliance 1864-1870) (the first google link I found was
http://www.onwar.com/aced/data/tango/triple1864.htm)
I was also involved in a war against Bolivia (Guerra del Chaco), but I understand that it was Bolivia who lost land in this case. I don't know about casualties.
Difference in opinions hath cost many millions of lives: for instance, whether flesh be bread, or bread be flesh; whether whistling be a vice or a virtue; whether it be better to kiss a post, or throw it into the fire... (from Gulliver's Travels)
