The paramilitaries were formed because the military and the government were on the defensive. The army couldn't even protect themselves, much less the people. There have been several high-profile slaughters of police and soldiers even during peace talks, maybe especially during peace talks. The FARC loved humiliating peace envoys by having a huge slaughter occur during a well publicized visit. So private Colombians organized the "Self Defense" units to take the fight to the FARC.
The military, at least until recently, used the paras as shock troops, to "pacify" an area before they would dare to enter it.
The work we have done with the military over the last couple of years seems to be making the paras less necessary, and if Bush manages to get reelected, I expect to see the country being progressively taken back from the FARC. You will remember that during the last half of the nineties the FARC held an autonomous region the size of Switzerland with the acquiescence of the government, where the army dared not go. No longer.
If Kerry wins, expect to see Colombia blackmailed to prosecute the paras for war crimes, ignoring the fact that FARC lives by assassination and kidnapping and drug running, and fear only the paras.
I am really keeping the fingers and toes crossed for a Bush win, not only for the US, but for Colombia. My work frequently brings me into contact with the situation there (although I have never been to Colombia) and I have always felt that the country was totally betrayed by Clinton, whose policies resulted in giving away that area the size of Switzerland that you mentioned.
Now the people actually seem to have some hope of having a normal national life again, and I think there is a very positive feeling there - but as you say, this will all vanish if Kerry is elected.