• TABLE OF CONTENTS
HIDE
 Title Page
 Preface
 Table of Contents
 Overview and background
 The range of Covert Action...
 Major Covert Action programs and...
 Chile: Authorization, assessment,...
 Preliminary conclusions
 Chronology: Chile 1962-1975














Title: Covert action in Chile, 1963-1973
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 Material Information
Title: Covert action in Chile, 1963-1973 staff report of the Select Committee to Study Governmental Operations with Respect to Intelligence Activities, United States Senate
Series Title: Covert action in Chile, 1963-1973
Physical Description: v, 62 p. : ; 24 cm.
Language: English
Creator: United States -- Congress. -- Senate. -- Select Committee to Study Governmental Operations with Respect to Intelligence Activities
Publisher: U.S. Govt. Print. Off.
Place of Publication: Washington
Publication Date: 1975
 Subjects
Subject: Foreign relations -- United States -- Chile   ( lcsh )
Foreign relations -- Chile -- United States   ( lcsh )
Foreign relations -- United States -- 1963-1969   ( lcsh )
Foreign relations -- United States -- 1969-1974   ( lcsh )
Genre: federal government publication   ( marcgt )
non-fiction   ( marcgt )
Spatial Coverage: United States of America
Chile
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General Note: At head of title: 94th Congress, 1st session. Committee Print.
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lccn - 76602625

Table of Contents
    Title Page
        Page i
        Page ii
    Preface
        Page iii
        Page iv
    Table of Contents
        Page v
        Page vi
    Overview and background
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
    The range of Covert Action in Chile
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
    Major Covert Action programs and their effects
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
        Page 30
        Page 31
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
        Page 39
        Page 40
    Chile: Authorization, assessment, and oversight
        Page 41
        Page 42
        Page 43
        Page 44
        Page 45
        Page 46
        Page 47
        Page 48
        Page 49
        Page 50
    Preliminary conclusions
        Page 51
        Page 52
        Page 53
        Page 54
        Page 55
        Page 56
    Chronology: Chile 1962-1975
        Page 57
        Page 58
        Page 59
        Page 60
        Page 61
        Page 62
Full Text



94th Congress 1
1st Session J


COMMITTEE PRINT


COVERT ACTION IN CHILE

1963-1973





STAFF REPORT

OF THE

SELECT COMMITTEE
TO STUDY GOVERNMENTAL OPERATIONS
WITH RESPECT TO

INTELLIGENCE ACTIVITIES

UNITED STATES SENATE










DECEMBER 18, 1975




Printed for the Use of the Select Committee To Study Governmental
Operations With Respect to Intelligence Activities


U.S. GOVERNMENT PRINTING OFFICE
63-372 WASHINGTON : 1975

For sale by the Superintendent of Documents, U.S. Government Printing Office
Washington, D.C. 20402 Price 80 cents
Stock Number 052-070-03145-0




































SENATE SELECT COMMITTEE TO STUDY GOVERNMENTAL OPERATIONS
WITH RESPECT TO INTELLIGENCE ACTIVITIES

FRANK CHURCH, Idaho, Chairman
JOHN G. TOWER, Texas, Vice Chairman


PHILIP A. HART, Michigan
WALTER F. MONDALE, Minnesota
WALTER D. HUDDLESTON, Kentucky
ROBERT MORGAN, North Carolina
GARY HART, Colorado


HOWARD H. BAKER, Jr., Tennessee
BARRY GOLDWATER, Arizona
CHARLES McC. MATHIAS. Jr., Maryland
RICHARD SCHWEIKER, Pennsylvania


WILLIAM G. MILLER, Staff Director
FREDERICK A. 0. SCHWARZ, Jr., Chief Counsel
CURTIs R. SMOTHERS, Counsel to the Minority
AUDREY HATRY, Clerk of the Committee
(II)












PREFACE

The statements of facts contained in this report are true to the best of
the Committee staff's ability to determine them. The report and any
judgment expressed in it are tentative. Several areas are merely
touched on; investigation in these areas is continuing. The purpose of
the report is to lay out the basic facts of covert action in Chile to
enable the Committee to hold public hearings.
This report is based on an extensive review of documents of the Cen-
tral Intelligence Agency, the Departments of State and Defense, and
the National Security Council; and on testimony by officials and former
officials. With few exceptions, names of Chileans and of Chilean
institutions have been omitted in order to avoid revealing intelli-
gence sources and methods and to limit needless harm to individual
Chileans who cooperated with the Central Intelligence Agency. The
report does, however, convey an accurate picture of the scope, purposes
and magnitude of United States covert action in Chile.
(III)
















TABLE OF CONTENTS

Page
I. Overview and Background ---------------------------- ----- 1
A. Overview: Covert Action in Chile------------------------------ 1
B. Issues ----------------------------------------------- 3
C. Historical Background in Recent United States-Chilean Relations_ 3
II. The Range of Covert Action in Chile---------------------------- 6
A. Covert Action and other Clandestine Activities---------------- 6
B. Covert Action in Chile: Techniques---------------------------- 7
C. Covert Action and Multinational Corporations------------------ 11
III. Major Covert Action Programs and Their Effects----------------- 14
A. The 1964 Presidential Election------------------------ --- 14
B. Covert Action: 1964-1969 ----------------------------- 17
C. The 1970 Election: A "Spoiling" Campaign ---- -------- 19
D. Covert Action Between September 4 and October 24, 1970 --__ 23
E. Covert Action During the Allende Years, 1970-1973------------ 26
F. Post-1973 ------------------------------------------ 39
IV. Chile: Authorization, Assessment, and Oversight------------------ 41
A. 40 Committee Authorization and Control: Chile 1969-1973 ------ 41
B. Intelligence Estimates and Covert Action---------------- 43
C. Congressional Oversight ---------------------------------- 49
V. Preliminary Conclusions ------------------------------------- 51
A. Covert Action and U.S. Foreign Policy----------------- 51
B. Executive Command and Control of Major Covert Action-------- 52
C. The Role of Congress--------------------------- 53
D. Intelligence Judgments and Covert Operations------------------ 54
E. Major Covert Action Programs-------------- ------------ 54
Appendix. Chronology : Chile 1962-1975 --------- --------------- 57













COVERT ACTION IN CHILE: 1963-1973

I. Overview and Background

A. OVERVIEW: COVERT ACTION IN CILE
Covert United States involvement in Chile in the decade between
1963 and 1973 was extensive and continuous. The Central Intelligence
Agency spent three million dollars in an effort to influence the out-
come of the 1964 Chilean presidential elections. Eight million dollars
was spent, covertly, in the three years between 1970 and the military
coup in September 1973, with over three million dollars expended in
fiscal year 1972 alone.1
It is not easy to draw a neat box around what was "covert action."
The range of clandestine activities undertaken by the CIA includes
covert action, clandestine intelligence collection, liaison with local
police and intelligence services, and counterintelligence. The distinc-
tions among the types of activities are mirrored in organizational
arrangements, both at Headquarters and in the field. Yet it is not
always so easy to distinguish the effects of various activities. If the
CIA provides financial support to a political party, this is called
"covert action"; if the Agency develops a paid "asset" in that party
for the purpose of information gathering, the project is "clandestine
intelligence collection."
The goal of covert action is political impact. At the same time secret
relationships developed for the clandestine collection of intelligence
may also have political effects, even though no attempt is made by
American officials to manipulate the relationship for short-run politi-
cal gain. For example, in Chile between 1970 and 1973, CIA and Ameri-
can military attache contacts with the Chilean military for the pur-
pose of gathering intelligence enabled the United States to sustain
communication with the group most likely to take power from Presi-
dent Salvador Allende.
What did covert CIA money buy in Chile? It financed activities
covering a broad spectrum, from simple propaganda manipulation
of the press to large-scale support for Chilean political parties, from
public opinion polls to direct attempts to foment a military coup. The
scope of "normal" activities of the CIA Station in Santiago included
placement of Station-dictated material in the Chilean media through
propaganda assets, direct support of publications, and efforts to oppose
communist and left-wing influence in student, peasant and labor
organizations.
In addition to these "routine" activities, the CIA Station in Santiago
was several times called upon to undertake large, specific projects.
1 Moreover, the bare figures are more likely to understate than to exaggerate the extent
of U.S. covert action. In the years before the 1973 coup, especially, CIA dollars could be
channeled through the Chilean black market where the unofficial exchange rate into
Chilean escudos often reached five times the official rate.
(1)









When senior officials in Washington perceived special dangers, or
opportunities, in Chile, special CIA projects were developed, often as
part of a larger package of U.S. actions. For instance, the CIA spent
over three million dollars in an election program in 1964.
Half a decade later, in 1970, the CIA engaged in another special
effort, this time at the express request of President Nixon and under
the injunction not to inform the Departments of State or Defense or
the Ambassador of the project. Nor was the 40 Committee 2 ever in-
formed. The CIA attempted, directly, to foment a military coup in
Chile. It passed three weapons to a group of Chilean officers who
plotted a coup. Beginning with the kidnapping of Chilean Army Com-
mander-in-Chief Ren6 Schneider. However, those guns were returned.
The group which staged the abortive kidnap of Schneider, which re-
sulted in his death, apparently was not the same as the group which
received CIA weapons.3
When the coup attempt failed and Allende was inaugurated Presi-
dent, the CIA was authorized by the 40 Committee to fund groups in
opposition to Allende in Chile. The effort was massive. Eight million
dollars was spent in the three years between the 1970 election and the
military coup in September 1973. Money was furnished to media
organizations, to opposition political parties and, in limited amounts,
to private sector organizations.
Numerous allegations have been made about U.S. covert activities
in Chile during 1970-73. Several of these are false; others are half-
true. In most instances, the response to the allegation must be qualified:
Was the United States directly involved, covertly, in the 1973 coup in Chile?
The Committee has found no evidence that it was. However, the United States
sought in 1970 to foment a military coup in Chile; after 1970 it adopted a policy
both overt and covert, of opposition to Allende; and it remained in intelligence
contact with the Chilean military, including officers who were participating in
coup plotting.
Did the U.S. provide covert support to striking truck-owners or other strikers
during 1971-73? The 40 Committee did not approve any such support. However,
the U.S. passed money to private sector groups which supported the strikers. And
in at least one case, a small amount of CIA money was passed to the strikers by
a private sector organization, contrary to CIA ground rules.
Did the U.S. provide covert support to right-wing terrorist organizations dur-
ing 1970-73? The CIA gave support in 1970 to one group whose tactics became
more violent over time. Through 1971 that group received small sums of Amer-
ican money through third parties for specific purposes. And it is possible that
money was passed to these groups on the extreme right from CIA-supported op-
position political parties.
The pattern of United States covert action in Chile is striking but
not unique. It arose in the context not only of American foreign
policy, but also of covert U.S. involvement in other countries within
and outside Latin America. The scale of CIA involvement in Chile
was unusual but by no means unprecedented.

2 The 40 Committee is a sub-Cabinet level body of the Executive Branch whose mandate
Is to review proposed major covert actions. The Committee has existed in similar form
since the 1950's under a variety of names: 5412 Panel, Special Group (until 1964), 303
Committee (to 1969), and 40 Committee (since 1969). Currently chaired by the President's
Assistant for National Security Affairs, the Committee includes the Undersecretary of
State for Political Affairs, the Deputy Secretary of Defense, the Chairman of the Joint
Chiefs of Staff, and the Director of Central Intelligence.
a This matter is discussed extensively in the Committee's interim report entitled, Alleged
Assassination Plots Involving Foreign Leaders, 94 Cong., 1 sess. (November 1975), pp.
225-254.








B. ISSUES
The Chilean case raises most of the issues connected with covert
action as an instrument of American foreign policy. It consisted of
long, frequently heavy involvement in Chilean politics; it involved
the gamut of covert action methods, save only covert military opera-
tions; and it revealed a variety of different authorization procedures,
with different implications for oversight and control. As one case
of U.S. covert action, the judgments of past actions are framed not
for their own sake; rather they are intended to serve as bases for
formulating recommendations for the future.
The basic questions are easily stated:
(1) Why did the United States mount such an extensive covert
action program in Chile? Why was that program continued and then
expanded in the early 1970's?
(2) How was this major covert action program authorized and
directed? What roles were played by the President, the 40 Committee,
the CIA, the Ambassadors, and the Congress ?
(3) Did U.S. policy-makers take into account the judgments of
the intelligence analysts on Chile when they formulated and approved
U.S. covert operations? Does the Chilean experience illustrate an
inherent conflict between the role of the Director of Central Intelli-
gence as a producer of intelligence and his role as manager of covert
operations ?
(4) Did the perceived threat in Chile justify the level of U.S.
response? What was the effect of such large concentrated programs
of covert political action in Chile? What were the effects, both abroad
and at home, of the relationships which developed between the intelli-
gence agencies and American based multinational corporations?

C. HISTORICAL BACKGROUND TO RECENT UNITED STATES-CHILEAN
RELATIONS
1. Chilean Politics and Society: An Overview
Chile has historically attracted far more interest in Latin America
and, more recently, throughout the world, than its remote geographic
position and scant eleven-million population would at first suggest.
Chile's history has been one of remarkable continuity in civilian,
democratic rule. From independence in 1818 until the military coup
d'etat of September 1973, Chile underwent only three brief interrup-
tions of its democratic tradition. From 1932 until the overthrow of
Allende in 1973, constitutional rule in Chile was unbroken.
Chile defies simplistic North American stereotypes of Latin Amer-
ica. With more than two-thirds of its population living in cities, and
a 1970 per capital GNP of $760, Chile is one of the most urbanized and
industrialized countries in Latin America. Nearly all of the Chilean
population is literate. Chile has an advanced social welfare program,
although its activities did not reach the majority of the poor until
popular participation began to be exerted in the early 1960's. Chileans
are a largely integrated mixture of indigenous American with Euro-
pean immigrant stock. Until September 1973, Chileans brokered their
demands in a bicameral parliament through a multi-party system and
through a broad array of economic, trade union, and, more recently,
managerial and professional associations.
63-372-75-2







2. U.S. Policy Toward Chile
The history of United States policy toward Chile followed the pat-
terns of United States diplomatic and economic interests in the hemi-
sphere. In the same year that the United States recognized Chilean
independence, 1823, it also proclaimed the Monroe Doctrine. This uni-
lateral policy pronouncement of the United States was directed as a
warning toward rival European powers not to interfere in the inter-
nal political affairs of this hemisphere.
The U.S. reaction to Fidel Castro's rise to power suggested that
while the Monroe Doctrine had been abandoned, the principles which
prompted it were still alive. Castro's presence spurred a new United
States hemispheric policy with special significance for Chile-the Alli-
ance for Progress. There was little disagreement among policymakers
either at the end of the Eisenhower Administration or at the beginning
of the Kennedy Administration that something had to be done about
the alarming threat that Castro was seen to represent to the stability
of the hemisphere.
The U.S. reaction to the new hemispheric danger-communist revo-
lution-evolved into a dual policy response. Widespread malnutrition,
illiteracy, hopeless housing conditions and hunger for the vast major-
ity of Latin Americans who were poor; these were seen as communism's
allies. Consequently, the U.S. undertook loans to national develop-
ment programs and supported civilian reformist regimes, all with an
eye to preventing the appearance of another Fidel Castro in our
hemisphere.
But there was another component in U.S. policy toward Latin Amer-
ica. Counterinsurgency techniques were developed to combat urban
or rural guerrilla insurgencies often encouraged or supported by Cas-
tro's regime. Development could not cure overnight the social ills
which were seen as the breeding ground of communism. New loans for
Latin American countries' internal national development programs
would take time to bear fruit. In the meantime, the communist threat
would continue. The vicious circle plaguing the logic of the Alliance
for Progress soon became apparent. In order to eliminate the short-
term danger of communist subversion, it was often seen as necessary to
support Latin American armed forces, yet frequently it was those
same armed forces who were helping to freeze the status quo which the
Alliance sought to alter.
Of all the countries in the hemisphere, Chile was chosen to become
the showcase for the new Alliance for Progress. Chile had the exten-
sive bureaucratic infrastructure to plan and administer a national
development program; moreover, its history of popular support for
Socialist, Communist and other leftist parties was perceived in Wash-
ington as flirtation with communism. In the years between 1962 and
1969, Chile received well over a billion dollars in direct, overt United
States aid, loans and grants both included. Chile received more aid per
capital than any country in the hemisphere. Between 1964 and 1970,
$200 to $300 million in short-term lines of credit was continuously
available to Chile from private American banks.
3. Chilean Political Parties: 1958-1970
The 1970 elections marked the fourth time Salvador Allende had
been the presidential candidate of the Chilean left. His personality and
his program were familiar to Chilean voters. His platform was simi-







lar in all three elections: efforts to redistribute income and reshape the
Chilean economy, beginning with the nationalization of major indus-
tries, especially the copper companies; greatly expanded agrarian re-
form; and expanded relations with socialist and communist countries.
Allende was one of four candidates in the 1958 elections. His princi-
pal opponents were Jorge Alessandri, a conservative, and Eduardo
Frei. the candidate of the newly formed Christian Democratic Party,
which contended against the traditionally centrist Radical Party. Al-
lende's coalition was an uneasy alliance, composed principally of the
Socialist and Communist Parties, labeled the Popular Action Front
(FRAP). Allende himself, a self-avowed Marxist, was considered a
moderate within his Socialist Party, which ranged from the extreme
left to moderate social democrats. The Socialists, however, were more
militant than the pro-Soviet, bureaucratic-though highly organized
and disciplined-Communist Party.
Allende finished second to Alessandri in the 1958 election by less
than three percent of the vote. Neither candidate received a majority,
and the Chilean Congress voted Alessandri into office. If Allende had
received the votes which went to a leftist priest-who received 3.3 per-
cent of the votes-he would have won the election.
The Alessandri government lost popularity during its tenure. Dis-
satisfaction with it was registered in the 1961 congressional and 1963
municipal elections. The FRAP parties made significant gains, and
the Christian Democratic Party steadily increased its share of the
electorate until, in the 1963 elections, it became the largest single party.
The 1964 election shaped up as a three-way race. Frei was once again
the Christian Democratic candidate, and the parties of the left once
again selected Allende as their standard-bearer. The governing coali-
tion, the Democratic Front, chose Radical Julio Duran as their can-
didate. Due in part to an adverse election result in a March 1964
by-election in a previously conservative province, the Democratic Front
collapsed. The Conservatives and Liberals, reacting to the prospect of
an Allende victory, threw their support to Frei, leaving Duran as the
standard-bearer of only the Radical Party.
After Frei's decisive majority victory, in which he received 57
percent of the vote, he began to implement what he called a "revolution
in liberty." That included agrarian, tax, and housing reform. To deal
with the American copper companies, Frei proposed "Chileanization,"
by which the state would purchase majority ownership in order to exer-
cise control and stimulate output.
Frei's reforms, while impressive, fell far short of what he had prom-
ised. Lacking a majority in Congress, he was caught between the
FRAP parties, which demanded extreme measures, and the rightists,
who withheld support from Frei in order to force a compromise on
the agrarian reform issue. Like its predecessor, the Frei government
lost popularity during its tenure; the Christian Democrats' portion of
the vote in congressional elections fell from 43 percent in 1965 to 31
percent in 1969. During the Frei years the internal strains of the
Party became more evident, culminating in the 1968 defection of the
Party's left-wing elements.
Frei's relations with the United States were cordial, although he
pursued an independent foreign policy. His government established
diplomatic relations with the Soviet Union immediately after taking
power and in 1969 reestablished trade relations with Cuba.












II. The Range of Covert Action in Chile

A. COVERT ACTION AND OTHER CLANDESTINE ACTIVITIES
This study is primarily concerned with what is labeled "covert ac-
tion" by the United States government. Covert action projects are
considered a distinct category and are authorized and managed ac-
cordingly. But it is important to bear in mind what the category ex-
cludes as well as what it includes. The Committee's purpose is to
evaluate the intent and effect of clandestine American activities in
Chile. Some secret activities by the United States not labeled "covert
action" may have important political impacts and should be considered.
The CIA conducts several kinds of clandestine activity in foreign
countries: clandestine collection of positive foreign intelligence;
counterintelligence (or liaison with local services); and covert
action. Those different activities are handled somewhat differently in
Washington; they are usually the responsibility of different CIA
officers in the field. Yet all three kinds of projects may have effects on
foreign politics. All three rely on the establishment of clandestine
relationships with foreign nationals.
In the clandestine collection of intelligence, the purpose of the re-
lationship is the gathering of information. A CIA officer establishes
a relationship with a foreign "asset"-paid or unpaid-in a party or
government institution in order to find out what is going on inside
that party or institution. There is typically no attempt made by the
CIA officer to influence the actions of the "asset." Yet even that kind
of covert relationship may have political significance. Witness the
maintenance of CIA's and military attaches' contacts with the Chilean
military after the inauguration of Salvador Allende: although the
purpose was information-gathering, the United States maintained
links to the group most likely to overthrow the new president. To do
so was to walk a tightrope; the distinction between collecting informa-
tion and exercising influence was inherently hard to maintain. Since
the Chilean military perceived its actions to be contingent to some
degree on the attitude of the U.S. government, those possibilities
for exercising influence scarcely would have had to be consciously
manipulated.
Liaison relationships with local police or intelligence services pose
a similar issue. The CIA established such relationships in Chile with
the primary purpose of securing assistance in gathering intelligence
on external targets. But the link also provided the Station with in-
formation on internal subversives and opposition elements within
Chile. That raised the difficulty of ensuring that American officials did
not stray into influencing the actions of Chileans with whom they were
in contact. And it meant that the CIA was identified, to some degree,
with the internal activities of Chilean police and intelligence services,
(6)









whether or not the U.S. government supported those actions. That
became a matter for great concern in 1973 with the advent of the
Pinochet regime.
The purpose of this case study is to describe and assess the range
of covert U.S. activities which influenced the course of political events
in Chile. Most of the discussion which follows is limited to activities
labeled and run as "covert action" projects. That category is itself
broad. But it excludes other clandestine activities with possible
political effects.

B. COVERT ACTION IN CIIILE: TECHNIQUES
Even if the set of activities labeled "covert action" does not include
all clandestine American efforts with possible political effects, that
set is nonetheless broad. U.S. covert action in Chile encompassed a
range of techniques and affected a wide variety of Chilean institu-
tions. It included projects which were regarded as the framework
necessary for covert operations, as well as major efforts called forth by
special circumstances. The following paragraphs will give a flavor of
that range.
1. Propaganda
The most extensive covert action activity in Chile was propaganda.
It was relatively cheap. In Chile, it continued at a low level during
"normal" times, then was cranked up to meet particular threats or to
counter particular dangers.
The most common form of a propaganda project is simply the devel-
opment of "assets" in media organizations who can place articles or
be asked to write them. The Agency provided to its field Stations sev-
eral kinds of guidance about what sorts of propaganda were desired.
For example, one CIA project in Chile supported from one to five
media assets during the seven years it operated (1965-1971). Most of
those assets worked for a major Santiago daily which was the key to
CIA propaganda efforts. Those assets wrote articles or editorials favor-
able to U.S. interests in the world (for example, criticizing the Soviet
Union in the wake of the Czechoslovakian invasion) ; suppressed news
items harmful to the United States (for instance about Vietnam) ; and
authored articles critical of Chilean leftists.
The covert propaganda efforts in Chile also included "black" prop-
aganda-material falsely purporting to be the product of a particular
individual or group. In the 1970 election, for instance, the CIA used
"black" propaganda to sow discord between the Communists and the
Socialists and between the national labor confederation and the Chilean
Communist Party.
Table I-Techniques of Covert Action-Expenditures in Chile, 1963-73
Techniques Amount
Propaganda for elections and other support for political parties -.. $8, 000, 000
Producing and disseminating propaganda and supporting mass
media ------------------__-------------- __ 4, 300, 000
Influencing Chilean institutions (labor, students, peasants, women)
and supporting private sector organizations -------------------- 900, 000
Promoting military coup d'etat--------------_-- __-------- <200, 000
Figures rounded to nearest $100,000.









In some cases, the form of propaganda was still more direct. The
Station financed Chilean groups who erected wall posters, passed out
political leaflets (at times prepared by the Station) and engaged in
other street activities. Most often these activities formed part of larger
projects intended to influence the outcomes of Chilean elections (see
below), but in at least one instance the activities took place in the
absence of an election campaign.
Of thirty-odd covert action projects undertaken by Chile by the CIA
between 1961 and 1974, approximately a half dozen had propaganda
as their principal activity. Propaganda was an important subsidiary
element of many others, particularly election projects. (See Table I.)
Press placements were attractive because each placement might pro-
duce a multiplier effect, being picked up and replayed by media outlets
other than the one in which it originally came out.

2. Support For Media
In addition to buying propaganda piecemeal, the Station often pur-
chased it wholesale by subsidizing Chilean media organizations
friendly to the United States. Doing so was propaganda writ large.
Instead of placing individual items, the CIA supported-or even
founded-friendly media outlets which might not have existed in the
absence of Agency support.
From 1953 through 1970 in Chile, the Station subsidized wire serv-
ices, magazines written for intellectual circles, and a right-wing weekly
newspaper. According to the testimony of former officials, support for
the newspaper was terminated because it became so inflexibly rightist
as to alienate responsible conservatives.
By far, the largest-and probably the most significant-instance
of support for a media organization was the money provided to El
Mercurio, the major Santiago daily, under pressure during the Allende
regime. That support grew out of an existing propaganda project.
In 1971 the Station judged that El Mercurio, the most important op-
position publication, could not survive pressure from the Allende
government, including intervention in the newsprint market and
the withdrawal of government advertising. The 40 Committee author-
ized $700,000 for El Mercurio on September 9, 1971, and added another
$965,000 to that authorization on April 11, 1972. A CIA project renewal
memorandum concluded that El Mercurio and other media outlets
supported by the Agency had played an important role in setting the
stage for the September 11, 1973, military coup which overthrew
Allende.

3. Gaining Influence in Chilean Institutions and Groups
Through its covert activities in Chile, the U.S. government sought
to influence the actions of a wide variety of institutions and groups in
Chilean society. The specific intent of those activities ran the gamut
from attempting to influence directly the making of government policy
to trying to counter communist or leftist influence among organized
groups in the society. That most of these projects included a propa-
ganda component is obvious.








From 1964 through 1968, the CIA developed contacts within the
Chilean Socialist Party and at the Cabinet level of the Chilean
government.
Projects aimed at organized groups in Chilean society had more
diffuse purposes than efforts aimed at government institutions. But
the aim was similar: influencing the direction of political events in
Chile.
Projects were directed, for example, toward:
Wresting control of Chilean university student organizations
from the communists;
Supporting a women's group active in Chilean political and
intellectual life;
Combating the communist-dominated Central Unica de Traba-
jadores Chilenos (CUTCh) and supporting democratic labor
groups; and
Exploiting a civic action front group to combat communist in-
fluence within cultural and intellectual circles.

4. Major Efforts To Influence Chilean Elections
Covert American activity was a factor in almost every major elec-
tion in Chile in the decade between 1963 and 1973. In several instances
the United States intervention was massive.
The 1964 presidential election was the most prominent example
of a large-scale election project. The Central Intelligence Agency spent
more than $2.6 million in support of the election of the Christian
Democratic candidate, in part to prevent the accession to the presi-
dency of Marxist Salvador Allende. More than half of the Christian
Democratic candidate's campaign was financed by the United States,
although he was not informed of this assistance. In addition, the Sta-
tion furnished support to an array of pro-Christian Democratic
student, women's, professional and peasant groups. Two other political
parties were funded as well in an attempt to spread the vote.
In Washington, an inter-agency election committee was established,
composed of State Department, White House and CIA officials. That
committee was paralleled by a group in the embassy in Santiago. No
special task force was established within the CIA, but the Station in
Santiago was reinforced. The Station assisted the Christian Democrats
in running an American-style campaign, which included polling, voter
registration and get-out-the-vote drives, in addition to covert
propaganda.
The United States was also involved in the 1970 presidential cam-
paign. That effort, however, was smaller and did not include support
for any specific candidate. It was directed more at preventing Allende's
election than at insuring another candidate's victory.
Nor have U.S. involvements been limited to presidential campaigns.
In the 1965 Chilean congressional elections, for instance, the Station
was authorized by the 303 Committee to spend up to $175,000. Covert
support was provided to a number of candidates selected by the Am-
bassador and Station. A CIA election memorandum suggested that the
project did have some impact, including the elimination of a number
of FRAP (leftist coalition) candidates who might otherwise have won
congressional seats.








5. Support For Chilean Political Parties
Most covert American support to Chilean political parties was fur-
nished as part of specific efforts to influence election outcomes. How-
ever, in several instances the CIA provided subsidies to parties for
more general purposes, when elections were not imminent. Most such
support was furnished during the Allende years, 1970-1973, when
the U.S. government judged that without its support parties of the
center and right might not survive either as opposition elements or as
contestants in elections several years away.
In a sequence of decisions in 1971 through 1973, the 40 Committee
authorized nearly $4 million for opposition political parties in Chile.
Most of this money went to the Christian Democratic Party (PDC),
but a substantial portion was earmarked for the National Party (PN),
a conservative grouping more stridently opposed to the Allende gov-
ernment than was the PDC. An effort was also made to split the ruling
Popular Unity coalition by inducing elements to break away.
The funding of political parties on a large scale in 1970-73 was
not, however, without antecedents, albeit more modest in scale. In
1962 the Special Group (predecessor to the 40 Committee) authorized
several hundred thousand dollars for an effort to build up the PDC
in anticipation of the 1964 elections. Small authorizations were made,
in 1963 and 1967, for support to moderate elements within the Radical
Party.
6. Support For Private Sector Organizations
As part of its program of support for opposition elements during
the Allende government, the CIA provided money to several trade
organizations of the Chilean private sector. In September 1972, for
instance, the 40 Committee authorized $24,000 in emergency support
for an anti-Allende businessmen's organization. At that time, sup-
porting other private sector organizations was considered but re-
jected because of the fear that those organizations might be involved
in anti-government strikes.
The 40 Committee authorized $100,000 for private sector organiza-
tions in October 1972, as part of the March 1973 election project.
According to the CIA, that money was spent only on election activities,
such as voter registration drives and get-out-the-vote drives. In August
1973, the Committee authorized support for private sector groups,
but with disbursement contingent on the agreement of the Ambassador
and State Department. That agreement was not forthcoming.
7. Direct Efforts To Promote A Military Coup
United States covert efforts to affect the course of Chilean politics
reached a peak in 1970: the CIA was directed to undertake an effort
to promote a military coup in Chile to prevent the accession to power of
Salvador Allende. That attempt, the so-called "Track II," is the sub-
ject of a separate Committee report and will be discussed in section
III below. A brief summary here will demonstrate the extreme in
American covert intervention in Chilean politics.
On September 15, 1970-after Allende finished first in the election
but before the Chilean Congress had chosen between him and the








runner-up, Alessandri,1-President Nixon met with Richard Helms,
the Director of Central Intelligence, Assistant to the President for
National Security Affairs Henry Kissinger and Attorney General
John Mitchell. Helms was directed to prevent Allende from taking
power. This effort was to be conducted without the knowledge of
the Departments of State and Defense or the Ambassador. Track
II was never discussed at a 40 Committee meeting.
It quickly became apparent to both White House and CIA officials
that a military coup was the only way to prevent Allende's acces-
sion to power. To achieve that end, the CIA established contact with
several groups of military plotters and eventually passed three wea-
pons and tear gas to one group. The weapons were subsequently re-
turned, apparently unused. The CIA knew that the plans of all groups
of plotters began with the abduction of the constitutionalist Chief of
Staff of the Chilean Army, General Ren6 Schneider. The Committee
has received conflicting testimony about the extent of CIA/White
House communication and of White House officials' awareness of
specific coup plans, but there is no doubt that the U.S. government
sought a military coup in Chile.
On October 22, one group of plotters attempted to kidnap Schneider.
Schneider resisted, was shot, and subsequently died. The CIA had
been in touch with that group of plotters but a week earlier had with-
drawn its support for the group's specific plans.
The coup plotting collapsed and Allende was inaugurated President.
After his election, the CIA and U.S. military attaches maintained
contacts with the Chilean military for the purpose of collecting intel-
ligence. Whether those contacts strayed into encouraging the Chilean
military to move against Allende; or whether the Chilean military-
having been goaded toward a coup during Track II-took encourage-
ment to act against the President from those contacts even though
U.S. officials did not intend to provide it: these are major questions
which are inherent in U.S. covert activities in the period of the Allende
government.

C. COVErrT ACTION AND MULTINATIONAL CORPORATIONS
In addition to providing information and cover to the CIA, multi-
national corporations also participated in covert attempts to influence
Chilean politics. The following is a brief description of the CIA's rela-
tionship with one such corporation in Chile in the period 1963-1973-
International Telephone and Telegraph, Inc. (ITT). Not only is ITT
the most prominent and public example, but a great deal of informa-
tion has been developed on the CIA/ITT relationship. This summary
is based on new information provided to this Committee and on mate-
rial previously made public by the Subcommittee on Multinational
Corporations of the Senate Foreign Relations Committee.

1. 1964 Chilean Elections
During the 1964 presidential campaign, representatives of multina-
tional corporations approached the CIA with a proposal to provide
Allende received 36.3 percent of the vote, Alessandri 34.9 percent. Radomiro Tomic.
the PDC candidate, finished third with 27.8 percent.


63-372-73-3








campaign funds to the Christian Democratic Party. The CIA decision
not to accept such funds, as well as other CIA contacts with multina-
tional corporations during that campaign, are fully described in Part
III.
2. 1970 Chilean Elections: Phase I
In 1970, the U.S. government and several multinational corpora-
tions were linked in opposition to the candidacy and later the presi-
dency of Salvador Allende. This CIA-multinational corporation con-
nection can be divided into two phases. Phase I comprised actions tak-
en by either the CIA or U.S.-based multinational companies at a time
when it was official U.S. policy not to support, even covertly, any can-
didate or party in Chile. During this phase the Agency was, however,
authorized to engage in a covert "spoiling" operation designed to de-
feat Salvador Allende. Phase II encompassed the relationship between
intelligence agencies and multinational corporations after the Septem-
ber 1970 general election. During Phase II, the U.S. government
opposed Allende and supported opposition elements. The government
sought the cooperation of multinational corporations in this effort.
A number of multinational corporations were apprehensive about
the possibility that Allende would be elected President of Chile.
Allende's public announcements indicated his intention, if elected, to
nationalize basic industries and to bring under Chilean ownership
service industries such as the national telephone company, which was
at that time a subsidiary of ITT.
In 1964 Allende had been defeated, and it was widely known both
in Chile and among American multinational corporations with sig-
nificant interests in Chile that his opponents had been supported by
the United States government. John McCone, a former CIA Director
and a member of ITT's Board of Directors in 1970, knew of the sig-
nificant American government involvement in 1964 and of the offer
of assistance made at that time by American companies. Agency docu-
ments indicate that McCone informed Harold Geneen, ITT's Board
Chairman, of these facts.
In 1970 leaders of American multinational corporations with sub-
stantial interests in Chile, together with other American citizens con-
cerned about what might happen to Chile in the event of an Allende
victory, contacted U.S. government officials in order to make their
views known.
In July 1970, a CIA representative in Santiago met with represen-
tatives of ITT and, in a discussion of the upcoming election, indicated
that Alessandri could use financial assistance. The Station suggested
the name of an individual who could be used as a secure channel for
getting these funds to the Alessandri campaign.
Shortly thereafter John McCone telephoned CIA Director Richard
Helms. As a result of this call, a meeting was arranged between the
Chairman of the Board of ITT and the Chief of the Western Hemi-
sphere Division of the CIA. Geneen offered to make available to the
CIA a substantial amount of money to be used in support of the
Alessandri campaign. In subsequent meetings ITT offered to make $1
million available to the CIA. The CIA rejected the offer. The memo-
randum indicated further that CIA's advice was sought with respect
to an individual who might serve as a conduit of ITT funds to the
Alessandri campaign.








The CIA confirmed that the individual in question was a reliable
channel which could be used for getting funds to Alessandri. A second
channel of funds from ITT to a political party opposing Allende, the
National Party, was developed following CIA advice as to a secure
funding mechanism utilizing two CIA assets in Chile. These assets
were also receiving Agency funds in connection with the "spoiling"
operation.
During the period prior to the September election, ITT represen-
tatives met frequently with CIA representatives both in Chile and
in the United States and CIA advised ITT as to ways in which it
might safely channel funds both to the Alessandri campaign and to
the National Party. CIA was kept informed of the extent and the
mechanism of the funding. Eventually at least $350,000 was passed
by ITT to this campaign. A roughly equal amount was passed by
other U.S. companies; the CIA learned of this funding but did not
assist in it.
3. Following the 1970 Chilean Elections: Phase II
Following the September 4 elections, the United States government
adopted a policy of economic pressure directed against Chile and in
this connection sought to enlist the influence of Geneen on other
American businessmen. Specifically, the State Department was di-
rected by the 40 Committee to contact American businesses having
interests in Chile to see if they could be induced to take actions in
accord with the American government's policy of economic pressure
on Chile. On September 29, the Chief of the Western H-emisphere
Division of the CIA met with a representative of ITT. The CIA
official sought to have ITT involved in a more active way in Chile.
According to CIA documents, ITT took note of the CIA presentation
on economic warfare but did not actively respond to it.
One institution in Chile which was used in a general anti-Allende
effort was the newspaper chain El Mercurio. Both the United States
government and ITT were funneling money into the hands of in-
dividuals associated with the paper. That funding continued after
Allende was in office.
A great deal of testimony has been taken on the above matters,
initially before the Subcommittee on Multinational Corporations. The
degree of cooperation between the CIA and ITT in the period prior
to the September 1970 election raises an important question: while
the U.S. government was not supporting particular candidates or
parties, even covertly, was the CIA authorized to act on its own in
advising or assisting ITT in its covert financial support of the
Alessandri campaign ?













III. Major Covert Action Programs and Their Effects

This section outlines the major programs of covert action under-
taken by the United States in Chile, period by period. In every in-
stance, covert action was an instrument of United States foreign
policy, decided upon at the highest levels of the government. Each
subsection to follow sets forth that policy context. Without it, it is
impossible to understand the covert actions which were undertaken.
After a discussion of policy, each subsection elaborates the covert ac-
tion tactics employed in each case. Finally, the effect of each major
program is assessed.
The section begins with the first major United States covert action
in Chile-the 1964 presidential elections.
A. THE 1964 PRESIDENTIAL ELECTIoN
1. United States Policy
The United States was involved on a massive scale in the 1964
presidential election in Chile. The Special Group authorized over
three million dollars during the 1962-64 period to prevent the elec-
tion of a Socialist or Communist candidate. A total of nearly four
million dollars was spent on some fifteen covert action projects, rang-
ing from organizing slum dwellers to passing funds to political
parties.
The goal, broadly, was to prevent or minimize the influence of
Chilean Communists or Marxists in the government that would
emerge from the 1964 election. Consequently, the U.S. sought the most
effective way of opposing FRAP (Popular Action Front), an alliance
of Chilean Socialists, Communists, and several miniscule non-Marxist
parties of the left which backed the candidacy of Salvador Allende.
specifically, the policy called for support of the Christian Democratic
Party, the Democratic Front (a coalition of rightist parties), and a
variety of anti-communist propaganda and organizing activities.
The groundwork for the election was laid early in 1961 by estab-
lishing operational relationships with key political parties and by
creating propaganda and organizational mechanisms capable of in-
fluencing key sectors of the population. Projects that had been con-
ducted since the 1950's among peasants, slum dwellers, organized
labor, students, and the media provided a basis for much of the pre-
election covert action.
The main problem facing the United States two years before the
election was the selection of a party and/or candidate to support
against the leftist alliance. The CIA presented two papers to the
Special Group on April 2, 1962. One of these papers proposed support
for the Christian Democratic Party, while the other recommended sup-
port of the Radical Party, a group to the right of the Christian
Democrats. The Special Group approved both proposals. Although








this strategy appears to have begun as an effort to hedge bets and
support two candidates for President, it evolved into a strategy de-
signed to support the Christian Democratic candidate.
On August 27, 1962, the Special Group approved the use of a third-
country funding channel and authorized $180,000 in fiscal year 1963
for the Chilean Christian Democrats. The Kennedy Administration
had preferred a center-right government in Chile, consisting of the
Radicals on the right and the Christian Democrats in the center.
However, political events in Chile in 1962-1963-principally the
creation of a right-wing alliance that included the Radical Party-
precluded such a coalition. Consequently, throughout 1963, the United
States funded both the Christian Democrats and the right-wing
coalition, the Democratic Front.
After a by-election defeat in May 1964 destroyed the Democratic
Front, the U.S. threw its support fully behind the Christian Demo-
cratic candidate. However, CIA funds continued to subsidize the Rad-
ical Party candidate in order to enhance the Christian Democrats'
image as a moderate progressive party being attacked from the right
as well as the left.

2. Covert Action Techniques
Covert action during the 1964 campaign was composed of two major
elements. One was direct financial support of the Christian Democratic
campaign. The CIA underwrote slightly more than half of the total
cost of that campaign. After debate, the Special Group decided not
to inform the Christian Democratic candidate, Eduardo Frei, of
American covert support of his campaign. A number of intermediaries
were therefore mobilized to pass the money to the Christian Demo-
crats. In addition to the subsidies for the Christian Democratic Party,
the Special Group allocated funds to the Radical Party and to private
citizens' groups.
In addition to support for political parties, the CIA mounted a
massive anti-communist propaganda campaign. Extensive use was
made of the press, radio, films, pamphlets, posters, leaflets, direct mail-
ings, paper streamers, and wall painting. It was a "scare campaign,"
which relied heavily on images of Soviet tanks and Cuban firing
squads and was directed especially to women. Hundreds of thousands
of copies of the anti-communist pastoral letter of Pope Pius XI were
distributed by Christian Democratic organizations. They carried the
designation, "printed privately by citizens without political affiliation,
in order more broadly to disseminate its content." "Disinformation"
and "black propaganda"-material which purported to originate from
another source, such as the Chilean Communist Party-were used as
well.
The propaganda campaign was enormous. During the first week of
intensive propaganda activity (the third week of June 1964), a CIA-
funded propaganda group produced twenty radio spots per day in
Santiago and on 44 provincial stations; twelve-minute news broadcasts
five time daily on three Santiago stations and 24 provincial outlets;
thousands of cartoons, and much paid press advertising. By the end
of June, the group produced 24 daily newscasts in Santiago and the
provinces, 26 weekly "commentary" programs, and distributed 3,000








posters daily. The CIA regards the anti-communist scare campaign
as the most effective activity undertaken by the U.S. on behalf of
the Christian Democratic candidate.
The propaganda campaign was conducted internationally as well,
and articles from abroad were "replayed" in Chile. Chilean newspapers
reported: an endorsement of Frei by the sister of a Latin American
leader, a public letter from a former president in exile in the U.S., a
"message from the women of Venezuela," and dire warnings about an
Allende victory from various figures in military governments in Latin
America.
The CIA ran political action operations independent of the Christian
Democrats' campaign in a number of important voter blocks, includ-
ing slum dwellers, peasants, organized labor, and dissident Socialists.
Support was given to "anti-communist" members of the Radical Party
in their efforts to achieve positions of influence in the party hierarchy,
and to prevent the party from throwing its support behind Allende.

3. U.S. Government Organization for the 1964 Chilean Election
To manage the election effort, an electoral committee was established
in Washington, consisting of the Assistant Secretary of State for In-
ter-American Affairs, Thomas Mann; the Western Hemisphere Divi-
sion Chief of the CIA, Desmond Fitzgerald; Ralph Dungan and
McGeorge Bundy from the White House; and the Chief of the Western
Hemisphere Division Branch Four, the branch that has jurisdiction
over Chile. This group was in close touch with the State Department
Office of Bolivian and Chilean Affairs. In Santiago there was a par-
allel Election Committee that coordinated U.S. efforts. It included
the Deputy Chief of Mission, the CIA Chief of Station, and the heads
of the Political and Economic Sections, as well as the Ambassador.
The Election Committee in Washington coordinated lines to higher
authority and to the field and other agencies. No special task force was
established, and the CIA Station in Santiago was temporarily in-
creased by only.three officers.

4. Role of Multinational Corporations
A group of American businessmen in Chile offered to provide one
and a half million dollars to be administered and disbursed covertly
by the U.S. Government to prevent Allende from winning the 1964
presidential election. This offer went to the 303 Committee (the name
of the Special Group after June 1964) which decided not to accept the
offer. It decided that offers from American business could not be
accepted, that they were neither a secure way nor an honorable way
of doing business. This decision was a declaration of policy which
set the precedent for refusing to accept such collaboration between
CIA and private business. However, CIA money, represented as pri-
vate money, was passed to the Christian Democrats through a private
businessman.
5. Role of the Chilean Military
On July 19, 1964, the Chilean Defense Council, which is the equiva-
lent of the U.S. Joint Chiefs of Staff, went to President Alessandri
to propose a coup d'etat if Allende won. This offer was transmitted to








the CIA Chief of Station, who told the Chilean Defense Council
through an intermediary that the United States was absolutely op-
posed to a coup. On July 20, the Deputy Chief of Mission at the U.S.
Embassy was approached by a Chilean Air Force general who threat-
ened a coup if Allende won. The DCM reproached him for proposing
a coup d'etat and there was no further mention of it. Earlier, the CIA
learned that the Radical candidate for election, several other Chileans,
and an ex-politician from another Latin American country had met
on June 2 to organize a rightist group called the Legion of Liberty.
They said this group would stage a coup d'etat if Allende won, or if
Frei won and sought a coalition government with the Communist
Party. Two of the Chileans at the meeting reported that some military
officers wanted to stage a coup d'etat before the election if the United
States Government would promise to support it. Those approaches
were rebuffed by the CIA.

6. Effects of Covert Action
A CIA study concludes that U.S. intervention enabled Eduardo
Frei to win a clear majority in the 1964 election, instead of merely a
plurality. What U.S. Government documents do not make clear is why
it was necessary to assure a majority, instead of accepting the victory
a plurality would have assured. CIA assistance enabled the Christian
Democratic Party to establish an extensive organization at the neigh-
borhood and village level. That may have lent grassroots support for
reformist efforts that the Frei government undertook over the next
several years.
Some of the propaganda and polling mechanisms developed for use
in 1964 were used repeatedly thereafter, in local and congressional
campaigns, during the 1970 presidential campaign, and throughout
the 1970-1973 Allende presidency. Allegations of CIA involvement in
the campaign, and press allegations of CIA funding of the Interna-
tional Development Foundation contributed to the U.S. reluctance
in 1970 to undertake another massive pre-election effort.

B. COVERT ACTION: 1964-1969
During the years between the election of Christian Democratic
President Eduardo Frei in 1964 and the presidential election cam-
paign of 1970, the CIA conducted a variety of covert activities in Chile.
Operating within different sectors of society, these activities were all
intended to strengthen groups which supported President Frei and
opposed Marxist influences.
The CIA spent a total of almost $2 million on covert action in Chile
during this period, of which one-fourth was covered bv 40 Committee
authorizations for specific major political action efforts. The CIA
conducted twenty covert action projects in Chile during these years.

1. Covert Action Methods
In February 1965 the 303 Committee approved $175,000 for a short-
term political action project to provide covert support to selected
candidates in the March 1965 congressional elections in Chile. Ac-
cording to the CIA, twenty-two candidates were selected by the Sta-








tion and the Ambassador; nine were elected. The operation helped
defeat up to 13 FRAP candidates who would otherwise have won
congressional seats.
Another election effort was authorized in July 1968, in preparation
for the March 1969 congressional election. The 40 Committee author-
ized $350,000 for this effort, with the objective of strengthening moder-
ate political forces before the 1970 presidential election. The program
consisted of providing financial support to candidates, supporting
a splinter Socialist Party in order to attract votes away from
Allende's socialist party, propaganda activities, and assisting inde-
pendent groups. The CIA regarded the election effort as successful
in meeting its limited objective; ten of the twelve candidates selected
for support won their races, including one very unexpected victory.
The support provided to the dissident socialist group deprived the
Socialist Party of a minimum of seven congressional seats.
The 303 Committee also approved $30,000 in 1967 to strengthen the
right wing of the Radical Party.
A number of other political actions not requiring 303 Committee
approval were conducted. The project to increase the effectiveness and
appeal of the Christian Democratic Party and to subsidize the party
during the 1964 elections continued into late 1965 or 1966, as did a
project to influence key members of the Socialist Party toward ortho-
dox European socialism and away from communism. During this
period, the CIA dealt with a Chilean official at the cabinet level,
though with scant result.
Covert action efforts were conducted during this period to influence
the political development of various sectors of Chilean society. One
project, conducted prior to the 1964 elections to strengthen Christian
Democratic support among peasants and slum dwellers, continued to
help train and organize "anti-communists" in these and other sectors
until public exposure of CIA funding in 1967 forced its termination.
A project to compete organizationally with the Marxists among the
urban poor of Santiago was initiated shortly after the 1964 election,
and was terminated in mid-1969 because the principal agent was un-
willing to prejudice the independent posture of the organization by
using it on a large scale to deliver votes in the 1969 and 1970 presi-
dential elections. In the mid-1960's, the CIA supported an anti-com-
munist women's group active in Chilean political and intellectual life.
Two projects worked within organized labor in Chile. One, which
began during the 1964 election period, was a labor action project to
combat the communist-dominated Central Unica de Trabajadores Chi-
lenos (CUTCh) and to support democratic labor groups. Another
project was conducted in the Catholic labor field.
Various CIA projects during this period supported media efforts.
One, begun in the early 1950's, operated wire services. Another, which
was an important part of the 1964 election effort, supported anti-com-
munist propaganda activities through wall posters attributed to fic-
titious groups, leaflet campaigns, and public heckling.
A third project supported a right-wing weekly newspaper, which
was an instrument of the anti-Allende campaign during and for a time
after the 1970 election campaign. Another project funded an asset
who produced regular radio political commentary shows attacking








the political parties on the left and supporting CIA-selected candi-
dates. After the Soviet invasion of Czechoslovakia, this asset organ-
ized a march on the Soviet Embassy which led to major police action
and mass media coverage. Other assets funded under this project
placed CIA-inspired editorials almost daily in El Mercurio, Chile's
major newspaper and, after 1968, exerted substantial control over the
content of that paper's international news section.
The CIA also maintained covert liaison relations with Chile's
internal security and intelligence services, civilian and military. The
primary purpose of these arrangements was to enable the Chilean
services to assist CIA in information collection about foreign targets.
A subsidiary purpose of these relationships was to collect information
and meet the threat posed by communists and other groups of the far
left within Chile.
2. Effects of Covert Action
The CIA's evaluations of the 1965 and 1969 election projects sug-
gest that those efforts were relatively successful in achieving their
immediate goals. On the other hand, the labor and "community devel-
opment" projects were deemed rather unsuccessful in countering the
growth of strong leftist sentiment and organization among workers,
peasants and slum dwellers. For instance, neither of the labor projects
was able to find a nucleus of legitimate Chilean labor leaders to com-
pete effectively with the communist-dominated CUTCh.
The propaganda projects probably had a substantial cumulative
effect over these years, both in helping to polarize public opinion con-
cerning the nature of the threat posed by communists and other leftists,
and in maintaining an extensive propaganda capability. Propaganda
mechanisms developed during the 1960's were ready to be used in the
1970 election campaign. At the same time, however, in a country where
nationalism, "economic independence" and "anti-imperialism" claimed
almost universal support, the persistent allegations that the Christian
Democrats and other parties of the center and right were linked to the
CIA may have played a part in undercutting popular support for
them.
C. THE 1970 ELECTION: A "SPOILING" CAMPAIGN
1. United States Policy and Covert Action
Early in 1969, President Nixon announced a new policy toward
Latin America, labelled by him "Action for Progress." It was to
replace the Alliance for Progress which the President characterized
as paternalistic and unrealistic. Instead, the United States was to seek
"mature partnership" with Latin American countries, emphasizing
trade and not aid. The reformist trappings of the Alliance were to be
dropped; the United States announced itself prepared to deal with
foreign governments pragmatically.
The United States program of covert action in the 1970 Chilean
elections reflected this less activist stance. Nevertheless, that covert
involvement was substantial. In March 1970, the 40 Committee decided
that the United States should not support any single candidate in the
election but should instead wage "spoiling" operations against the
Popular Unity coalition which supported the Marxist candidate,


63 372-75-









Salvador Allende. In all, the CIA spent from $800,000 to $1,000,000
on covert action to affect the outcome of the 1970 Presidential elec-
tion. Of this amount, about half was for major efforts approved
by the 40 Committee. By CIA estimates, the Cubans provided about
$350,000 to Allende's campaign, with the Soviets adding an additional,
undetermined amount. The large-scale propaganda campaign which
was undertaken by the U.S. was similar to that of 1964: an Allende
victory was equated with violence and repression.
2. Policy Decisions
Discussions within the United States Government about the 1970
elections began in the wake of the March 1969 Chilean congressional
elections. The CIA's involvement in those elections was regarded by
Washington as relatively successful, even though the Christian Demo-
crats' portion of the vote fell from 43 per cent in 1965 to 31 per cent in
1969. In June 1968 the 40 Committee had authorized $350,000 for that
effort, of which $200,000 actually was spent. Ten of the twelve CIA-
supported candidates were elected.
The 1970 election was discussed at a 40 Committee meeting on April
17, 1969. It was suggested that something be done, and the CIA rep-
resentative noted that an election operation would not be effective
unless it were started early. But no action was taken at that time.
The 1970 Presidential race quickly turned into a three-way contest.
The conservative National Party, buoyed by the 1969 congressional
election results, supported 74-year-old, ex-President Jorge Alessandri.
Radomiro Tomic became the Christian Democratic nominee. Tomic,
to the left of President Frei, was unhappy about campaigning on the
Frei government's record and at one point made overtures to
the Marxist left. Salvador Allende was once again the candidate of the
left, this time formed into a Popular Unity coalition which included
both Marxist and non-Marxist parties. Allende's platform included
nationalization of the copper mines, accelerated agrarian reform,
socialization of major sectors of the economy, wage increases, and
improved relations with socialist and communist countries.
In December 1969. the Embassy and Station in Santiago forwarded
a proposal for an anti-Allende campaign. That proposal, however, was
withdrawn because of the State Department's qualms about whether
or not the United States should become involved at all. The CIA felt
it was not in a position to support Tomic actively because ambassa-
dorial "ground rules" of the previous few years had prevented the CIA
from dealing with the Christian Democrats. The Agency believed that
Alessandri, the apparent front runner, needed more than money; he
needed help in managing his campaign.
On March 25, 1970, the 40 Committee approved a joint Embassy/
CIA proposal recommending that "spoiling" operations-propaganda
and other activities-be undertaken by the CIA in an effort to prevent
an election victory by Allende. Direct support was not furnished to
either of his opponents. This first authorization was for $135,000, with
the possibility of more later.
On June 18, 1970, the Ambassador, Edward Korry, submitted a two-
phase proposal to the Department of State and the CIA for review.
The first phase involved an increase in support for the anti-Allende
campaign. The second was a $500,000 contingency plan to influence the








congressional vote in the event of a vote between the candidates finish-
ing first and second. In response to State Department reluctance, the
Ambassador responded by querying: if Allende were to gain power,
how would the U.S. respond to those who asked what actions it had
taken to prevent it?
On June 27, the 40 Committee approved the increase in funding for
the anti-Allende "spoiling" operation by $300,000. State Department
officials at the meeting voted "yes" only reluctantly. They spoke
against the contingency plan, and a decision on it was deferred pend-
img the results of the September 4 election.
CIA officials met several times with officials from ITT during July.
The CIA turned down ITT's proposal to make funds available for
CIA transmission to Alessandri but did provide the company advice
on how to pass money to Alessandri. Some $350,000 of ITT money was
passed to Alessandri during the campaign-$250,000 to his campaign
and $100,000 to the National Party. About another $350,000 came
from other U.S. businesses. According to CIA documents, the Station
Chief informed the Ambassador that the CIA was advising ITT in
funding the Alessandri campaign, but not that the Station was aiding
ITT in passing money to the National Party.
The 40 Committee met again on August 7 but did not give further
consideration to supporting either Alessandri or Tomic. As the anti-
Allende campaign in Chile intensified, senior policy makers turned to
the issue of U.S. policy in the event of an Allende victory. A study done
in response to National Security Study Memorandum 97 was approved
by the Interdepartmental Group (IG) on August 18. The approved
paper 1 set forth four options, one in the form of a covert annex. The
consensus of the Interdepartmental Group favored maintaining mini-
mal relations with Allende, but the Senior Review Group deferred de-
cision until after the elections. Similarly, a paper with alternatives was
circulated to 40 Committee members on August 13, but no action
resulted.
3. "Spoiling" Operations
The "spoiling" operations had two objectives: (1) undermining
communist efforts to bring about a coalition of leftist forces which
could gain control of the presidency in 1970; and (2) strengthening
non-Marxist political leaders and forces in Chile to order to develop
an effective alternative to the Popular Unity coalition in preparation
for the 1970 presidential election.
In working toward these objectives, the CIA made use of half-a-
dozen covert action projects. Those projects were focused into an
intensive propaganda campaign which made use of virtually all media
within Chile and which placed and replayed items in the interna-
tional press as well. Propaganda placements were achieved through
subsidizing right-wing women's and "civic action" groups. A "scare
campaign," using many of the same themes as the 1964 presidential
election program, equated an Allende victory with violence and Stalin-
ist repression. Unlike 1964, however, the 1970 operation did not involve
extensive public opinion polling, grass-roots organizing, or "commu-
nity development" efforts, nor, as mentioned, direct funding of any
candidate.
SThe minutes of the Interdepartmental Group and Senior Review Group deliberations
have not as yet been provided to the Committee.








In addition to the massive propaganda campaign, the CIA's effort
prior to the election included political action aimed at splintering the
non-Marxist Radical Party and reducing the number of votes which
it could deliver to the Popular Unity coalition's candidate. Also, "black
propaganda"-imaterial purporting to be the product of another
group-was used in 1970 to sow dissent between Communists and
Socialists, and between the national labor confederation and the
Chilean Community Party.
The CIA's propaganda operation for the 1970 elections made use
of mechanisms that had been developed earlier. One mechanism had
been used extensively by the CIA during the March 1969 congressional
elections. During the 1970 campaign it produced hundreds of thou-
sands of high-quality printed pieces, ranging from posters and leaflets
to picture books, and carried out an extensive propaganda program
through many radio and press outlets. Other propaganda mechanisms
that were in place prior to the 1970 campaign included an editorial
support group that provided political features, editorials, and news
articles for radio and press placement; a service for placing anti-com-
munist press and radio items; and three different news services.
There was a wide variety of propaganda products: a newsletter
mailed to approximately two thousand journalists, academicians, poli-
ticians, and other opinion makers; a booklet showing what life would
be like if Allende won the presidential election; translation and dis-
tribution of chronicles of opposition to the Soviet regime; poster
distribution and sign-painting teams. The sign-painting teams had
instructions to paint the slogan "su pared6n" (your wall) on 2,000
walls, evoking an image of communist firing squads. The "scare cam-
paign" (campaila de terror) exploited the violence of the invasion of
Czechoslovakia with large photographs of Prague and of tanks in
downtown Santiago. Other posters, resembling those used in 1964,
portrayed Cuban political prisoners before the firing squad, and
warned that an Allende victory would mean the end of religion and
family life in Chile.
Still another project funded individual press assets. One, who pro-
duced regular radio commentary shows on a nationwide hookup, had
been CIA funded since 1965 and continued to wage propaganda for
CIA during the Allende presidency. Other assets, all employees of
El Mercurio, enabled the Station to generate more than one editorial
per day based on CIA guidance. Access to El Mercurio had a multi-
plier effect, since its editorials were read throughout the country on
various national radio networks. Moreover, El Mercurio was one of the
most influential Latin American newspapers, particularly in business
circles abroad. A project which placed anti-communist press and radio
items was reported in 1970 to reach an audience of well over five-
million listeners.
The CIA funded only one political group during the 1970 campaign,
in an effort to reduce the number of Radical Party votes for Allende.

4. Effects
The covert action "spoiling" efforts by the United States during
the 1970 campaign did not succeed: Allendo won a plurality in the
September 4 election. Nevertheless, the "spoiling" campaign had
several important effects.







First, the "scare campaign" contributed to the political polariza-
tion and financial panic of the period. Themes developed during the
campaign were exploited even more intensely during the weeks follow-
ing September 4, in an effort to cause enough financial panic and politi-
cal instability to goad President Frei or the Chilean military into
action.
Second, many of the assets involved in the anti-Allende campaign
became so visible that their usefulness was limited thereafter. Several
of them left Chile. When Allende took office, little was left of the CIA-
funded propaganda apparatus. Nevertheless, there remained a nucleus
sufficient to permit a vocal anti-Allende opposition to function effec-
tively even before the new President was inaugurated.

D. COVERT ACTION BETWEEN 'SEPTEMBER 4 AND OCTOBER 24, 19702
On September 4, 1970, Allende won a plurality in Chile's presiden-
tial election. Since no candidate had received a majority of the popular
vote, the Chilean Constitution required that a joint session of its Con-
gress decide between the first- and second-place finishers. The date set
for the congressional session was October 24, 1970.
The reaction in Washington to Allende's plurality victory was
immediate. The 40 Committee met on September 8 and 14 to discuss
what action should be taken prior to the October 24 congressional
vote. On September 15, President Nixon informed CIA Director
Richard Helms that an Allende regime in Chile would not be accepta-
ble to the United States and instructed the CIA to play a direct role
in organizing a military coup d'etat in Chile to prevent Allende's
accession to the Presidency.
Following the September 14 meeting of the 40 Committee and Pres-
ident Nixon's September 15 instruction to the CIA, U.S. Government
efforts to prevent Allende from assuming office proceeded on two
tracks.3 Track I comprised all covert activities approved by the 40
Committee, including political, economic and propaganda activities.
These activities were designed to induce Allende's opponents in Chile
to prevent his assumption of power, either through political or mili-
tary means. Track II activities in Chile were undertaken in response
to President Nixon's September 15 order and were directed toward
actively promoting and encouraging the Chilean military to move
against Allende.
1. Track I
A. POLITICAL ACTION

Initially, both the 40 Committee and the CIA fastened on the so-
called Frei re-election gambit as a means of preventing Allende's
assumption of office. This gambit, which was considered a constitu-
tional solution to the Allende problem, consisted of inducing enough
congressional votes to elect Alessandri over Allende with the under-
standing that Alessandri would immediately resign, thus paving the
way for a special election in which Frei would legally become a candi-
date. At the September 14 meeting of the 40 Committee, the Frei gam-
2 This period, and particularly Track II, are dealt with in detail in an interim Committee
Report, Alleged Assassination Plots Involving Foreign Leaders, 94 Cong., 1st Sess.
November 1975. pp. 225-254.
3 The terms Track I and Track II were known only to CIA and White House officials
who were knowledgeable about the President's September 15 order to the CIA.







bit was discussed, and the Committee authorized a contingency fund
of $250,000 for covert support of projects which Frei or his associates
deemed important. The funds were to be handled by Ambassador
Korry and used if it appeared that they would be needed by the mod-
erate faction of the Christian Democratic Party to swing congres-
sional votes to Alessandri. The only proposal for the funds which was
discussed was an attempt to bribe Chilean Congressmen to vote for
Alessandri. That quickly was seen to be unworkable, and the $250,000
was never spent.
CIA's Track I aimed at bringing about conditions in which the
Frei gambit could take place. To do this, the CIA, at the direction of
the 40 Committee, mobilized on interlocking political action, economic,
and propaganda campaign. As part of its political action program, the
CIA attempted indirectly to induce President Frei at least to consent
to the gambit or, better yet, assist in its implementation. The Agency
felt that pressures from those whose opinion and views he valued-
in combination with certain propaganda activities-represented the
only hope of converting Frei. In Europe and Latin America, influen-
tial members of the Christian Democratic movement and the Catholic
Church were prompted either to visit or contact Frei. In spite of these
efforts, Frei refused to interfere with the constitutional process, and
the re-election gambit died.

B. PROPAGANDA CAMPAIGN
On September 14, the 40 Committee agreed that a propaganda
campaign should be undertaken by the CIA to focus on the damage
that would befall Chile under an Allende government. The campaign
was to include support for the Frei re-election gambit. According to
a CIA memorandum, the campaign sought to create concerns about
Chile's future if Allende were elected by the Congress; the propaganda
was designed to influence Frei, the Chilean elite, and the Chilean
military.
The propaganda campaign included several components. Predictions
of economic collapse under Allende were replayed in CIA-generated
articles in European and Latin American newspapers. In response to
criticisms of El Mercurio by candidate Allende, the CIA, through its
covert action resources, orchestrated cables of support and protest from
foreign newspapers, a protest statement from an international press
association, and world press coverage of the association's protest.
In addition, journalists-agents and otherwise-traveled to Chile for
on-the-scene reporting. By September 28, the CIA had agents who
were journalists from ten different countries in or en route to Chile.
This group was supplemented by eight more journalists from five
countries under the direction of high-level agents who were, for the
most part, in managerial capacities in the media field.
Second, the CIA relied upon its own resources to generate anti-
Allende propaganda in Chile. These efforts included: support for an
underground press; placement of individual news items through
agents; financing a small newspaper; indirect subsidy of Patria y Lib-
ertad, a group fervently opposed to Allende, and its radio programs,
political advertisements, and political rallies; and the direct mailing of
foreign news articles to Frei, his wife, selected leaders, and the
Chilean domestic press.







Third, special intelligence and "inside" briefings were given to U.S.
journalists, at their request. One Time cover story was considered
particularly noteworthy. According to CIA documents, the Time cor-
respondent in Chile apparently had accepted Allende's protestations
of moderation and constitutionality at face value. Briefings requested
by Time and provided by the CIA in Washington resulted in a
change in the basic thrust of the Time story on Allende's September 4
victory and in the timing of that story.
A few statistics convey the magnitude of the CIA's propaganda
campaign mounted during the six-week interim period in the Latin
American and European media. According to the CIA, partial re-
turns showed that 726 articles, broadcasts, editorials, and similar items
directly resulted from Agency activity. The Agency had no way to
measure the scope of the multiplier effect-i.e., how much its "induced"
news focused media interest on the Chilean issues and stimulated ad-
ditional coverage-but concluded that its contribution was both
substantial and significant.

C. ECONOMIC PRESSURES
On September 29, 1970, the 40 Committee met. It was agreed that
the Frei gambit had been overtaken by events and was dead. The
"second-best option"-the cabinet resigning and being replaced with
a military cabinet-was also deemed dead. The point was then made
that there would probably be no military action unless economic
pressures could be brought to bear on Chile. It was agreed that an
attempt would be made to have American business take steps in line
with the U.S. government's desire for immediate economic action.
The economic offensive against Chile, undertaken as a part of Track
I, was intended to demonstrate the foreign economic reaction to Al-
lende's accession to power, as well as to preview the future consequences
of his regime. Generally, the 40 Committee approved cutting off all
credits, pressuring firms to curtail investment in Chile and approach-
ing other nations to cooperate in this venture.
These actions of the 40 Committee, and the establishment of an
interagency working group to coordinate overt economic activities
towards Chile (composed of the CIA's Western Hemisphere Division
Chief and representatives from State, the NSC, and Treasury), ad-
versely affected the Chilean economy; a major financial panic ensued.
However, U.S. efforts to generate an economic crisis did not have the
desired impact on the October 24 vote, nor did they stimulate a military
intervention to prevent Allende's accession.

2. Track II
As previously noted, U.S. efforts to prevent Allende's assumption
of office operated on two tracks between September 4 and October 24.
Track II was initiated by President Nixon on September 15 when he
instructed the CIA to play a direct role in organizing a military coup
d'etat in Chile. The Agency was to take this action without coordina-
tion with the Departments of State or Defense and without informing
the U.S. Ambassador. While coup possibilities in general and other
means of seeking to prevent Allende's accession to power were ex-
plored by the 40 Committee throughout this period, the 40 Committee








never discussed this direct CIA role. In practice, the Agency was to
report, both for informational and approval purposes, to the White
House.
Between October 5 and October 20 1970, the CIA made 21 contacts
with key military and Carabinero (police) officials in Chile. Those
Chileans who were inclined to stage a coup were given assurances of
strong support at the highest levels of the U.S. Government both
before and after a coup.
Tracks I and II did, in fact, move together in the month after
September 15. Ambassador Korry, who was formally excluded from
Track II, was authorized to encourage a military coup, provided
Frei concurred in that solution. At the 40 Committee meeting on
September 14, he and other "appropriate members of the Embassy
mission" were authorized to intensify their contacts with Chilean
military officers to assess their willingness to support the "Frei gam-
bit." The Ambassador was also authorized to make his contacts in the
Chilean military aware that if Allende were seated, the military
could expect no further military assistance (MAP) from the United
States. Later, Korry was authorized to inform the Chilean military
that all MAP and military sales were being held in abeyance pending
the outcome of the congressional election on October 24.
The essential difference between Tracks I and II, as evidenced by
instructions to Ambassador Korry during this period, was not that
Track II was coup-oriented and Track I was not. Both had this ob-
jective in mind. There were two differences between the two tracks:
Track I was contingent on at least the acquiescence of Frei; and the
CIA's Track II direct contacts with the Chilean military, and its
active promotion and support for a coup, were to be known only to a
small group of individuals in the White House and the CIA.
Despite these efforts, Track II proved to be no more successful than
Track I in preventing Allende's assumption of office. Although cer-
tain elements within the Chilean army were actively involved in coup
plotting, the plans of the dissident Chileans never got off the ground.
A rather disorganized coup attempt did begin on October 22, but
aborted following the shooting of General Schneider.
On October 24, 1970, Salvador Allende was confirmed as President
by Chilean Congress. On November 3, he was inaugurated. U.S. ef-
forts, both overt and covert, to prevent his assumption of office had
failed.

E. COVERT ACTION DURING THE ALLENDE YEARS, 1970-1973
1. United States Policy and Covert Action
In his 1971 State of the World Message, released February 25, 1971,
President Nixon announced: "We are prepared to have the kind of
relationship with the Chilean government that it is prepared to have
with us." This public articulation of American policy followed internal
discussions during the NSSM 97 exercise. Charles Meyer, Assistant
Secretary of State for Inter-American Affairs, elaborated that "correct
but minimal" line in his 1973 testimony before the Senate Foreign
Relations Subcommittee on Multinational Corporations:
Mr. MEYER. The policy of the Government, Mr. Chairman, was that there would
be no intervention in the political affairs of Chile. We were consistent in that we








financed no candidates, no political parties before or after September 8, or
September 4 ... The policy of the United States was that Chile's problem was
a Chilean problem, to be settled by Chile. As the President stated in October
of 1969, "We will deal with governments as they are." (Multinational Corpora-
tions and United States Foreign Policy, Hearing before the Subcommittee on
Multinational Corporations of the Committee on Foreign Relations, United States
Senate, Ninety-Third Congress, Washington: GPO, 1973, Part 1, p. 402)
Yet, public pronouncements notwithstanding, after Allende's inaug-
uration the 40 Committee approved a total of over seven million dol-
lars in covert support to opposition groups in Chile. That money also
funded an extensive anti-Allende propaganda campaign. Of the total
authorized by the 40 Committee, over six million dollars was spent
(luring the Allende presidency and $84,000 was expended shortly
thereafter for commitments made before the coup. The total amount
spent on covert action in Chile during 1970-73 was approximately
$7 million, including project funds not requiring 40 Committee
approval.
Broadly speaking, U.S. policy sought to maximize pressures on the
Allende government to prevent its consolidation and limit its ability
to implement policies contrary to U.S. and hemispheric interests. That
objective was stated clearly in National Security Decision Memoran-
dum (NSDM) 93, issued in early November 1970. Other governments
were encouraged to adopt similar policies, and the U.S. increased ef-
forts to maintain close relations with friendly military leaders in the
hemisphere. The "cool but correct" overt posture denied the Allende
government a handy foreign enemy to use as a domestic and inter-
national rallying point. At the same time, covert action was one re-
flection of the concerns felt in Washington: the desire to frustrate
Allende's experiment in the Western Hemisphere and thus limit its
attractiveness as a model; the fear that a Chile under Allende might
harbor subversives from other Latin American countries; and the de-
termination to sustain the principle of compensation for U.S. firms
nationalized by the Allende government.
Henry Kissinger outlined several of these concerns in a background
briefing to the press on September 16, 1970, in the wake of Allende's
election plurality:
Now it is fairly easy for one to predict that if Allende wins, there is a good
chance that he will establish over a period of years some sort of Communist
government. In that case you would have one not on an island off the coast which
has not a traditional relationship and impact on Latin America, but in a major
Latin American country you would have a Communist government, joining, for
example, Argentina, which is already deeply divided, along a long frontier;
joining Peru, which has already been heading in directions that have been diffi-
cult to deal with, and joining Bolivia, which has also gone in a more leftist, anti-
U.S. direction, even without any of these developments.
So I don't think we should delude ourselves that an Allende takeover in
Chile would not present massive problems for us, and for democratic forces
and for pro-U.S. forces in Latin America. and indeed to the whole Western
Hemisphere. What would happen to the Western Hemisphere Defense Board,
or to the Organization of American States, and so forth, in extremely proble-
matical . It is one of those situations which is not too happy for American
interests. (Multinational Corporations and United States Foreign Policy,
Hearings before the Subcommittee on Multinational Corporations of the Com-
mittee on Foreign Relations, United States Senate, Ninety-Third Congress,
Washington: GPO, 1973, Part 2, pp. 542-3)
As the discussion of National Intelligence Estimates in Section IV
of this paper makes clear the more extreme fears about the effects of
Allende's election were ill-founded: there never was a significant
63-372-73- .5







threat of a Soviet military presence; the "export" of Allende's revolu-
tion was limited, and its value as a model more restricted still; and
Allende was little more hospitable to activist exiles from other Latin
American countries than his predecessor had been. Nevertheless, those
fears, often exaggerated, appear to have activated officials in
Washington.
The "cool but correct" public posture and extensive clandestine acti-
vities formed two-thirds of a triad of official actions. The third was
economic pressure, both overt and covert, intended to exacerbate the
difficulties felt by Chile's economy. The United States cut off economic
aid, denied credits, and made efforts-partially successful-to enlist
the cooperation of international financial institutions and private firms
in tightening the economic "squeeze" on Chile. That international
"squeeze" intensified the effect of the economic measures taken by oppo-
sition groups within Chile, particularly the crippling strikes in the
mining and transportation sectors. For instance, the combined effect
of the foreign credit squeeze and domestic copper strikes on Chile's
foreign exchange position was devastating.
Throughout the Allende years, the U.S. maintained close contact
with the Chilean armed forces, both through the CIA and through
U.S. military attaches. The basic purpose of these contacts was the
gathering of intelligence, to detect any inclination within the Chilean
armed forces to intervene. But U.S. officials also were instructed to
seek influence within the Chilean military and to be generally suppor-
tive of its activities without appearing to promise U.S. support for
military efforts which might be premature. For instance, in November
1971, the Station was instructed to put the U.S. government in a posi-
tion to take future advantage of either a political or a military solution
to the Chilean dilemma, depending on developments within the coun-
try and the latter's impact on the military themselves.
There is no hard evidence of direct U.S. assistance to the coup,
despite frequent allegations of such aid. Rather the United States-
by its previous actions during Track II, its existing general posture of
opposition to Allende, and the nature of its contacts with the Chilean
military-probably gave the impression that it would not look with
disfavor on a military coup. And U.S. officials in the years before 1973
may not always have succeeded in walking the thin line between moni-
toring indigenous coup plotting and actually stimulating it.
2. Techniques of Covert Action
A. SUPPORT FOR OPPOSITION POLITICAL PARTIES
More than half of the 40 Committee-approved funds supported the
opposition political parties: the Christian Democratic Party (PDC),
the National Party (PN), and several splinter groups. Nearly half-a-
million dollars was channeled to splinter groups during the Allende
years. Early in 1971 CIA funds enabled the PDC and PN to purchase
their own radio stations and newspapers. All opposition parties were
passed money prior to the April 1971 municipal elections and a con-
gressional by-election in July. In November 1971 funds were approved
to strengthen the PDC, PN, and splinter groups. An effort was also
made to induce a breakup of the UP coalition. CIA funds supported







the opposition parties in three by-elections in 1972, and in the March
1973 congressional election. Money provided to political parties not
only supported opposition candidates in the various elections, but
enabled the parties to maintain an anti-government campaign through-
out the Allende years, urging citizens to demonstrate their opposition
in a variety of ways.
Throughout the Allende years, the CIA worked to forge a united
opposition. The significance of this effort can be gauged by noting that
the two main elements opposing the Popular Unity government were
the National Party, which was conservative, and the reformist Chris-
tian Democratic Party, many of whose members had supported the
major policies of the new government.

B. PROPAGANDA AND SUPPORT FOR OPPOSITION MEDIA
Besides funding political parties, the 40 Committee approved large
amounts to sustain opposition media and thus to maintain a hard-hit-
ting propaganda campaign. The CIA spent $1.5 million in support of
El Mercurio, the country's largest newspaper and the most important
channel for anti-Allende propaganda. According to CIA documents,
these efforts played a significant role in setting the stage for the mili-
tary coup of September 11, 1973.
The 40 Committee approvals in 1971 and early 1972 for subsidizing
El Mercurio were based on reports that the Chilean government was
trying to close the El Mercurio chain. In fact, the press remained free
throughout the Allende period, despite attempts to harass and finan-
cially damage opposition media. The alarming field reports on which
the 40 Committee decisions to support El Mercurio were based are at
some variance with intelligence community analyses. For example,
an August 1971 National Intelligence Estimate-nine months after
Allende took power-maintained that the government was attempting
to dominate the press but commented that El Mercurio had managed
to retain its independence. Yet one month later the 40 Committee voted
$700,000 to keep El Mercurio afloat. And CIA documents in 1973
acknowledge that El Mercurio and, to a lesser extent, the papers
belonging to opposition political parties, were the only publications
under pressure from the government.
The freedom of the press issue was the single most important theme
in the international propaganda campaign against Allende. Among
the books and pamphlets produced by the major opposition research
organization was one which appeared in October 1972 at the time of
the Inter-American Press Association (IAPA) meeting in Santiago.
As in the 1970 period, the IAPA listed Chile as a country in which
freedom of the press was threatened.
The CIA's major propaganda project funded a wide range of prop-
aganda activities. It produced several magazines with national cir-
culations and a large number of books and special studies. It developed
material for placement in the El Mercurio chain (amounting to a total
daily circulation of over 300,000); opposition party newspapers; two
weekly newspapers; all radio stations controlled by opposition parties
and on several regular television shows on three channels. El Mercurio
was a major propaganda channel during 1970-73, as it had been during
the 1970 elections and pre-inauguration period.








The CIA also funded progressively a greater portion-over 75 per-
cent in 1973--of an opposition research organization. A steady flow of
economic and technical material went to opposition parties and private
sector groups. Many of the bills prepared by opposition parliamentari-
ans were actually drafted by personnel of the research organization.

C. SUPPORT FOR PRIVATE SECTOR ORGANIZATIONS
The Committee has taken testimony that 40 Committee-approved
funds were used to help maintain and strengthen the democratic op-
position in Chile. It has been stressed that CIA had nothing to do with
the truck owners' strike and the disorders that led to the coup. The
question of CIA support to Chilean private sector groups is a matter
of considerable concern because of the violent tactics used by several
of these groups in their efforts to bring about military intervention.
The issue of whether to support private groups was debated within
the Embassy and the 40 Committee throughout late 1972 and 1973.
In September 1972, the 40 Committee authorized $24,000 for "emer-
gency support" of a powerful businessmen's organization, but decided
against financial support to other private sector organizations because
of their possible involvement in anti-government strikes. In October
1972, the Committee approved $100,000 for three private sector orga-
nizations-the businessmen's organization, associations of large and
small businessmen and an umbrella organization of opposition
groups-as part of a $1.5 million approval for support to opposition
groups. According to CIA testimony, this limited financial support
to the private sector was confined to specific activities in support of the
opposition electoral campaign, such as voter registration drives and a
get-out-the-vote campaign.
After the March 1973 elections, in which opposition forces failed to
achieve the two-thirds majority in the Senate that might have per-
mitted them to impeach Allende and hold new elections, the U.S.
Government re-assessed its objectives. There seemed little likelihood
of a successful military coup, but there did appear to be a possibility
that increasing unrest in the entire country might induce the military
to re-enter the Allende government in order to restore order. Various
proposals for supporting private sector groups were examined in the
context, but the Ambassador and the Department of State remained
opposed to any such support because of the increasingly high level of
tension in Chile, and because the groups were known to hope for mili-
tary intervention.
Nevertheless, on August 20, the 40 Committee approved a proposal
granting $1 million to opposition parties and private sector groups,
with passage of the funds contingent on the concurrence of the Ambas-
sador, Nathaniel Davis, and the Department of State. None of these
funds were passed to private sector groups before the military coup
three weeks later.
While these deliberations were taking place, the CIA Station asked
Headquarters to take soundings to determine whether maximum sup-
port could be provided to the opposition, including groups like the
truck owners. The Ambassador agreed that these soundings should be
taken but opposed a specific proposal for $25,000 of support to the
strikers. There was a CIA recommendation for support to the truck







owners, but it is unclear whether or not that proposal came before
the 40 Committee. On August 25-16 days before the coup-Headquar-
ters advised the Station that soundings were being taken, but the CIA
Station's proposal was never approved.
The pattern of U.S. deliberations suggests a careful distinction be-
tween supporting the opposition parties and funding private sector
groups trying to bring about a military coup. However, given tur-
bulent conditions in Chile, the interconnections among the CIA-sup-
ported political parties, the various militant trade associations
(gremios) and paramilitary groups prone to terrorism and violent
disruption were many. The CIA was aware that links between these
groups and the political parties made clear distinctions difficult.
The most prominent of the right-wing paramilitary groups was
Patria y Libertad (Fatherland and Liberty), which formed following
Allende's September 4 election, during so-called Track II. The
CIA provided Patria y Libertad with $38,500 through a third
party during the Track II period, in an effort to create tension and
a possible pretext for intervention by the Chilean military. After
Allende took office, the CIA occasionally provided the group small
sums through third parties for demonstrations or specific propaganda
activity. Those disbursements, about seven thousand dollars in total,
ended in 1971. It is possible that CIA funds given to political parties
reached Patria y Libertad and a similar group, the Rolando Matus
Brigade, given the close ties between the parties and these
organizations.
Throughout the Allende presidency, Patria y Libertad was the most
strident voice opposing all compromise efforts by Christian Democrats,
calling for resistance to government measures, and urging insurrection
in the armed forces. Its tactics came to parallel those of the Movement
of the Revolutionary Left (MIR) at the opposite end of the political
spectrum. Patria y Libertad forces marched at opposition rallies
dressed in full riot gear. During the October 1972 national truckers'
strike, Patria y Libertad was reported to strew "miguelitos" (three-
pronged steel tacks) on highways in order to help bring the country's
transportation system to a halt. On July 13, 1973, Patria y Libertad
placed a statement in a Santiago newspaper claiming responsibility
for an abortive coup on June 29, and on July 17, Patria y Libertad
leader Roberto Thieme announced that his groups would unleash a
total armed offensive to overthrow the government.
With regard to the truckers' strike, two facts are undisputed. First,
the 40 Committee did not approve any funds to be given directly to
the strikers. Second, all observers agree that the two lengthy strikes
(the second lasted from July 13, 1973, until the September 11 coup)
could not have been maintained on the basis of union funds. It remains
unclear whether or to what extent CIA funds passed to opposition
parties may have been siphoned off to support strikes. It is clear that
anti-government strikers were actively supported by several of the
private sector groups which received CIA funds. There were extensive
links between these private sector organizations and the groups which
coordinated and implemented the strikes. In November 1972 the CIA
learned that one private sector group had passed $2,800 directly to
strikers, contrary to the Agency's ground rules. The CIA rebuked the
group but nevertheless passed it additional money the next month.







3. United States Economic Policies Toward Chile : 1970-1973
A. COVERT ACTION AND ECONOMIC PRESSURE
The policy response of the U.S. Government to the Allende regime
consisted of an interweaving of diplomatic, covert, military, and eco-
nomic strands. Economic pressure exerted by the United States formed
an important part of the mix. It is impossible to understand the effect
of covert action without knowing the economic pressure which accom-
panied it.
B. CHILEAN ECONOMIC DEPENDENCE
The demise of the brief Allende experiment in 1970-73 came as the
cumulative result of many factors-external and internal. The aca-
demic debate as to whether the external or the internal factors weighed
more heavily is endless. This is not the place to repeat it. A brief
description of the Chilean economy will suffice to suggest the probable
effect on Chile of U.S. economic actions and the possible interactions
between economic and political factors in causing Allende's downfall.
Chile's export-oriented economy remained, in 1970, dependent for
foreign exchange earnings on a single product-copper-much as it
had depended on nitrate in the 19th century. However, the Allende
Administration consciously adopted a policy of beginning to diversify
Chile's trade by expanding ties with Great Britain, the rest of the
Western European countries, and Japan, and by initiating minor
trade agreements with the Eastern Bloc countries.
Nevertheless, Chilean economic dependence on the United States
remained a significant factor during the period of the Allende gov-
ernment. In 1970, U.S. direct private investment in Chile stood at
$1.1 billion, out of an estimated total foreign investment of $1.672
billion. U.S. and foreign corporations played a large part in almost
all of the critical areas of the Chilean economy. Furthermore, United
States corporations controlled the production of 80 percent of Chile's
copper, which in 1970 accounted for four-fifths of Chile's foreign
exchange earnings. Hence, the Allende government faced a situation
in which decisions of foreign corporations had significant ramifica-
tions throughout the Chilean economy.
Chile had accumulated a large foreign debt during the Frei govern-
ment, much of it contracted with international and private banks.
Chile was able, through the Paris Club, to re-negotiate $800 million in
debts to foreign governments and medium-term debt to major U.S.
banks in early 1972. It also obtained in 1972 some $600 million in
credits and loans from socialist bloc countries and Western sources;
however, a study done by the Inter-American Committee on the Alli-
ance for Progress concluded that these credits were "tied to specific
development projects and [could] be used only gradually."
Even with a conscious policy of diversifying its foreign trading
patterns, in 1970 Chile continued to depend on the import of es-
sential replacement parts from United States firms. The availability of
short-term United States commercial credits dropped from around
$300 million during the Frei years to around $30 million in 1972. The
drop, a result of combined economic and political factors, seriously af-
fected the Allende government's ability to purchase replacement parts
and machinery for the most critical sectors of the economy: copper,
steel, electricity, petroleum, and transport.








By late 1972, the Chilean Ministry of the Economy estimated that
almost one-third of the diesel trucks at Chuquicamata Copper Mine,
30 percent of the privately owned city buses, 21 percent of all taxis,
and 33 percent of state-owned buses in Chile could not operate because
of the lack of spare parts or tires. In overall terms, the value of United
States machinery and transport equipment exported to Chile by U.S.
firms declined from $152.6 million in 1970 to $110 million in 1971.
C. THE INSTRUMENTS OF UNITED STATES FOREIGN ECONOMIC POLICY
TOWARD ALLENDE
United States foreign economic policy toward Allende's government
was articulated at the highest levels of the U.S. government, and
coordinated by interagency task forces. The policy was clearly framed
during the Track II period. Richard Helms' notes from his Septem-
ber 15, 1970, meeting with President Nixon, the meeting which ini-
tiated Track II, contain the indication: "Make the economy scream."
A week later Ambassador Korry reported telling Frei, through his
Defense Minister, that "not a nut or bolt would be allowed to reach
Chile under Allende."
While the Chilean economy was vulnerable to U.S. pressures over
a period of a few years, it was not in the short run. That judgment
was clearly made by intelligence analysts in the government, but
its implications seem not to have affected policy-making in September
and October of 1970. A February 1971 Intelligence Memorandum
noted that Chile was not immediately vulnerable to investment, trade
or monetary sanctions imposed by the United States. In fact, the im-
position of sanctions, while it would hurt Chile eventually, was seen
to carry one possible short-run benefit-it would have given Chile a
justification for renouncing nearly a billion dollars of debt to the
United States.
The policy of economic pressure-articulated in NSDM 93 of
November 1970-was to be implemented through several means. All
new bilateral foreign assistance was to be stopped, although disburse-
ments would continue under loans made previously. The U.S. would
use its predominant position in international financial institutions to
dry up the flow of new multilateral credit or other financial assistance.
To the extent possible, financial assistance or guarantees to U.S.
private investment in Chile would be ended, and U.S. businesses would
be made aware of the government's concern and its restrictive policies.
The bare figures tell the story. U.S. bilateral aid, $35 million in 1969,
was $1.5 million in 1971. (See Table II.) U.S. Export-Import Bank
credits, which had totalled $234 million in 1967 and $29 million in
1969, dropped to zero in 1971. Loans from the multilateral Inter-
American Development Bank (IDB), in which the U.S. held what
amounted to a veto, had totalled $46 million in 1970; they fell to $2
million in 1972 (United States A.I.D. figures). The only new IDB
loans made to Chile during the Allende period were two small loans
to Chilean universities made in January 1971.4 Similarly, the World
Bank made no new loans to Chile between 1970 and 1973. However,
the International Monetary Fund extended Chile approximately
$90 million during 1971 and 1972 to assist with foreign exchange
difficulties.
As with bilateral aid. disbursements were continued under previous commitments.
S54 million was disbursed between December 1970 and December 1972. (IDB figures)




















TABLE II.-FOREIGN AID TO CHILE FROM U.S. GOVERNMENT AGENCIES AND INTERNATIONAL INSTITUTIONS-TOTAL OF LOANS AND GRANTS
[In millions of dollars]

Fiscal year 1953-61 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974

Total U.S. economic aid.....-------..----- .. 339.7 169.8 85.3 127.1 130.4 111.9 260.4 97.1 80.8 29.6 8.6 7.4 3.8 9.8
U.S. AID-..-.........--- ..--- ...... --76.4 142.7 41.3 78.9 99.5 93.2 15.5 57.9 35.4 18.0 1.5 1.0 .8 5.3
U.S. Food for Peace.................... 94.2 6.6 22.0 26.9 14.2 14.4 7.9 23.0 15.0 7.2 6.3 5.9 2.5 3.2
U.S. Export-Import Bank--............. 169.0 .8 16.2 15.3 8.2 .1 234.6 14.2 28.7 3.3 --...-.... 1.6 3.1 198. 1
Total U.S. Military aid...................... 41.8 17.8 30.6 9.0 9.9 10.1 4.1 7.8 11.8 .8 5.7 12.3 15.0 15.9
Total U.S. economic and military aid......... 381.5 187.6 115.9 136.1 140.3 122.0 264.5 104.9 91.8 30.4 14.3 221.3 221.9 2123.8 ,
Total international organizations ........... 135.4 18.7 31.2 41.4 12.4 72.0 93.8 19.4 49.0 76.4 15.4 28.2 9.4 111.2
IBRD (World Bank)--......------.... ---. 95.2 .................... 22.6 4.4 2.7 60.0 -...---.. 11.6 19.3 ..-..-..--...-.. -......--- 13.5
Inter-American Development Bank (IDB). 5.7 15.1 24.4 16.6 4.9 62.2 31.0 16.5 31.9 45.6 12.0 2.1 5.2 97.3

1 Includes Ex-lm: 57.0 and other: 41.1.
2 Total per chart plus Export-Import Bank.
U.S. contributions to I.O.'s included above; therefore U.S. aid and international aid should not be added together.
Source: U.S. Overseas Loans and Grants, Obligations and Loan Authorizations, July 1, 1945 to June 30, 1971, pp. 40, 179; and July 1, 1945 to June 30, 1974, pp. 39, 175. Prepared by Statistics and Re-
ports Division, Office of Financial Management, Agency for International Development.








Reaction to events in Chile accounted for much of the momentum in
the United States Government for the development of a policy on ex-
propriation. In what came to be known as the Allende Doctrine, Chile
proposed to deduct a calculation of "excess profits" (over and above
reinvestments and a 10-12 percent profit margin) from any compen-
sation paid to nationalized firms in the copper sector. By this calcula-
tion, U.S. copper companies were in fact told they owed money. The
reaction of the U.S. Government was strong. In January 1972, Presi-
dent Nixon announced that, when confronted with such situations, the
U.S. would cut off bilateral aid and "withhold its support from loans
under consideration in multilateral development banks."
While the State Department, the CIA, and the Department of Com-
merce all participated in the United States economic policy toward
Chile, a central point in the execution of this policy was the Depart-
ment of the Treasury. The Department instructs U.S. representatives
on multilateral lending institutions. In the IDB, for instance, the U.S.
controlled 40 percent of the votes, sufficient to veto any "soft" IDB
loans. Loan proposals submitted to the IDB were held under study,
never coming up for a vote by the IDB Board. Whether U.S. actions,
and those of the multilateral institutions, were motivated by political
interests or economic judgments of Chile's "credit worthiness" is a de-
bate not yet definitively settled. However, it seems clear from the pat-
tern of U.S. economic actions and from the nature of debates within the
Executive Branch that American economic policy was driven more by
political opposition to an Allende regime than by purely technical
judgments about Chile's finances.
The posture of the Export-Import Bank, a United States public
institution, reflected the tone of U.S. economic policy toward Chile
during the Allende period. In the fall of 1970, the Bank dropped
Chile's credit rating from "B," the second category, to "D," the last
category. Insofar as the rating contributed to similar evaluations by
private U.S. banks, corporations, and international private investors,
it aggravated Chile's problem of attracting and retaining needed capi-
tal inflow through private foreign investment. In mid-August 1971
the Bank decided that a $21 million credit for Boeing passenger jets
would be deferred pending a resolution of the controversy over com-
pensation for nationalized U.S. copper companies. That Bank decision
came one month after the nationalization and two months before the
final decision on compensation. In fact, the Boeing decision had been
first announced in May, before the nationalization occurred.
The United States linked the question of indemnization for U.S. cop-
per companies with Chile's multilateral foreign debt. That foreign
debt, an inheritance from the obligations incurred by the Alessandri
and Frei governments, was the second highest foreign debt per capital
of any country in the world. Yet, in the 1972 and 1973 Paris Club for-
eign debt negotiations with Chile's principal foreign creditor nations,
the United States alone refused to consider rescheduling Chile's for-
eign debt payments until there was movement toward indemnization
for the U.S. copper companies. The United States also exerted pres-
sure on each of the other foreign creditor nations not to renegotiate
Chile's foreign debt as a group.








4. U.S. Relations with the Chlean Military
United States relations with the Chilean military during 1970-1973
must be viewed against the backdrop not only of the tradition of close
cooperation between the American and Chilean military services and
of continuing intelligence collection efforts, but also in the context of
Track II-an attempt to foment a military coup. Track II marked a
break in the nature of relations between U.S. officials and the Chilean
military.
Close personal and professional cooperation between Chilean and
U.S. officers was a tradition of long standing. The American military
presence in Chile was substantial, consisting both of military attaches,
the Embassy, and members of the Military Group who provided train-
ing and assistance to the Chilean armed services. In the late 1960's the
Military Group numbered over fifty; by the Allende period, it was
reduced to a dozen or so, for reasons which had primarily to do with
U.S. budget-cutting.
A. PRE-TRACK II
In July 1969 the CIA Station in Santiago requested and received
Headquarters approval for a covert program to establish intelligence
assets in the Chilean armed services for the purpose of monitoring coup
plotting. The program lasted for four years: it involved assets drawn
from all three branches of the Chilean military and included com-
mand-level officers, field- and company-grade officers, retired general
staff officers and enlisted men. From 1969 to August 1970, the pro-
ject adhered closely to its stated objective of monitoring and reporting
coup-oriented activity within the Chilean military.
During August, September and October of 1969, it became increas-
ingly clear from the agents' reports that the growing dissatisfaction
and unrest within the armed forces was leading to an unstable military
situation. These events culminated in the abortive military revolt of
October 1969-the Tarn nao. named after the Tacna regiment in San-
tiago. How close the amateurish Tana-zo came to success was a lesson
to remember, particularly in light of the upcoming Presidential elec-
tion of 1970 and the strong possibility that Salvador Allende would
emerge victorious.
B. TRACK II
The Track II covert action effort to organize a military coup to deny
Allende the Presidency caught the Santiago Station unprepared. Its
two assets in the Chilean military were not in a position to spark a
coup. To accomplish the mission directed by Washington, the Station
had to use a U.S. military attache and other hastily developed contacts
with the two main coup plotting groups in the Chilean military. These
contacts not only reported the plans of the groups but also relayed the
Station's advice about mechanics and timing, and passed on indica-
tions of U.S. Government support following a successful coup. With
the death of Schneider, the plotters' effort collapsed in disarray, leav-
ing the Station with only its initial assets in the military. It took the
Station another ten months to rebuild a network of agents among the
cautious Chilean military.










As part of its attmept to induce the Chilean military to intervene
before the October 24 congressional vote, the United States had
threatened to cut off military aid if the military refused to act. That
was accompanied by a promise of support in the aftermath of a coup.
However, military assistance was not cut off at the time of Allende's
confirmation (see Table III). Military sales jumped sharply from
1972 to 1973 and even more sharply from 1973 to 1971 after the coup
(see Table IV). Training of Chilean military personnel in Panama
also rose during the Allende years (see Table V).

C. 1970-73

After the failure of Track II, the CIA rebuilt its network of con-
tacts and remained close to Chilean military officers in order to monitor
developments within the armed forces. For their part, Chilean officers
who were aware that the United States once had sought a coup to pre-
vent Allende from becoming president must have been sensitive to
indications of continuing U.S. support for a coup.
By September 1971 a new network of agents was in place and the
Station was receiving almost daily reports of new coup plotting. The
Station and Headquarters began to explore ways to use this network.
At the same time, and in parallel, the Station and Headquarters dis-
cussed a "deception operation" designed to alert Chilean officers to real
or purported Cuban involvement in the Chilean army. Throughout the
fall of 1971, the Station and Headquarters carried on a dialogue about
both the general question of what to do with the intelligence network
and the objectives of the specific operation.

TABLE Ill.-MILITARY ASSISTANCE

Fiscal year Programed Delivered

1966--.....-- ........--............ .... .......... .... $8, 806, 000 $8,366,000
1967.----------------------....... ........ ------------- 4, 143, 000 4,766,000
1968-......_---.._.-. .........__ _. ..... .... 1, 801,000 7,507,000
1969..-----.. --.---------------------------------------------- 734,000 2,662,000
1970.--.---------------------------------..... 852,000 1,966,000
1971---.................... ............ ....... ..... ............... 698,000 1,033,000
1972 --- ------- -------...................... .......... 870, 000 2,227,000
1973 ................--...... ..............-....-.... 941,000 918,000
1974 .----.. ..... ................ _........_.. 912,000 619,000

I Figures are from a Department of Defense response to a Senate Select Committee document request and are
unclassified.
TABLE IV.-MILITARY SALES'

Fiscal year Orders Delivered

1966..-... ...............--------- ..................... $1,057,000 $1,490,000
1967....-- -. ......-..........------------- --..--..--- 2,559,0 00 1,690, 000
1968... ---------. ..---------..... 4,077,000 2,100,000
1969- --..----.-------------------------------------------------.. 1,676,000 2,147,000
1970-........----------.... .... -------------------------- .--- -.- 7,503,000 9, 145,000
1971 ......................................... .2, 886,000 2,958,000
1972.--.. ------------------------------------------------------ 6,238,000 4,583,000
1973-...-........... ............ --------------------------------14,972,000 2,242,000
1974.------..-------------------. 76,120,000 4,860,000

IFigures are from a Department of Defense response to a Senate Select Committee document request and are
unclassified.








TABLE V.-TRAINING IN PANAMAL
Number of Number of
Fiscal year people Fiscal year people

1966--.....---....---.......... -------------------------68 1971------.........----------------------------..... 146
1967 --...--.......-- --------------------57 1972 _._..........------------------ 197
1968 .-------------------------------- 169 1973.-----..-..------------ ----------- 257
1969 .---------------- --------------- 107 1974 -----........-..-- ..- ..-- ......----.260
1970 .----......----- ------------- ----- 181
SFigures are from a Department of Defense response to a Senate Select Committee document request and are
unclassified.

The Station proposed, in September, to provide information-
some of it fabricated by the CIA-which would convince senior Chile-
an Army officers that the Carabineros' Investigaciozes unit, with the
approval of Allende was acting in concert with Cuban intelligence
(DGI) to gather intelligence prejudicial to the Army high command.
It was hoped that the effort would arouse the military against Allende's
involvement with the Cubans, inducing the armed services to press
the government to alter its orientation and to move against it if neces-
sary. A month later CIA Headquarters suggested that the deception
operation be shelved, in favor of passing "verifiable" information to
the leader of the coup group which Headquarters and the Station per-
ceived as having the highest probability of success.
After a further Station request, Headquarters agreed to the opera-
tion, with the objective of educating senior Chilean officers and keep-
ing them on alert. In December 1971 a packet of material, including
a fabricated letter, was passed to a Chilean officer outside Chile. The
CIA did not receive any subsequent reports on the effect, if any, this
"information" had on the Chilean military. While the initial concep-
tion of the operation had included a series of such passages, no further
packets were passed.
The Station/Headquarters dialogue over the use of the intelligence
network paralleled the discussion of the deception operation. In No-
vember the Station suggested that the ultimate objective of the mili-
tary penetration program was a military coup. Headquarters responded
by rejecting that formulation of the objective, cautioning that the CIA
did not have 40 Committee approval to become involved in a coup.
However, Headquarters acknowledged the difficulty of drawing a firm
line between monitoring coup plotting and becoming involved in it.
It also realized that the U.S. government's desire to be in clandestine
contract with military plotters, for whatever purpose, might well
imply to them U.S. support for their future plans.
During 1970-73, the Station collected operational intelligence neces-
sary in the event of a coup-arrest lists, key civilian installations and
personnel that needed protection, key government installations which
need to be taken over, and government contingency plans which would
be used in case of a military uprising. According to the CIA, the data
was collected only against the contingency of future Headquarters
requests and was never passed to the Chilean military.
The intelligence network continued to report throughout 1972 and
1973 on coup plotting activities. During 1972 the Station continued to
monitor the group which might mount a successful coup, and it spent
a significantly greater amount of time and effort penetrating this








group than it had on previous groups. This group had originally come
to the Station's attention in October 1971. By January 1972 the Sta-
tion had successfully penetrated it and was in contact through an
intermediary with its leader.
During late 1971 and early 1972, the CIA adopted a more active
stance vis a vis its military penetration program, including a short-
lived effort to subsidize a small anti-government news pamphlet di-
rected at the armed services, its compilation of arrest lists and other
operational data, and its deception operation.
Intelligence reporting on coup plotting reached two peak periods, one
in the last week of June 1973 and the other during the end of August
and the first two weeks in September. It is clear the CIA received'
intelligence reports on the coup planning of the group which carried
out the successful September 11 coup throughout the months of July,
August, and September 1973.
The CIA's information-gathering efforts with regard to the Chilean
military included activity which went beyond the mere collection of
information. More generally, those efforts must be viewed in the con-
text of United States opposition, overt and covert, to the Allende
government. They put the United States Government in contact with
those Chileans who sought a military alternative to the Allende
presidency.
F. PosT-1973
1. Chile Since the Coup
Following the September 11, 1973, coup, the military Junta, led by
General Augusto Pinochet, moved quickly to consolidate its newly
acquired power. Political parties were banned, Congress was put in
indefinite recess, press censorship was instituted, supporters of Allende
and others deemed opponents of the new regime were jailed, and elec-
tions were put off indefinitely.
The prospects for the revival of democracy in Chile have improved
little over the last two years. A 1975 National Intelligence Estimate
stated that the Chilean armed forces were determined to oversee a
prolonged political moratorium and to revamp the Chilean political
system. The NIE stated that the Junta had established tight, authori-
tarian controls over political life in Chile which generally continued
in effect. It had outlawed Marxist parties in Chile as well as other
parties which had comprised Allende's coalition. In addition, the
Christian Democratic and National parties had been placed in invol-
untary recess. These two parties were forbidden from engaging in
political activity and restricted to purely housekeeping functions.
In addition, charges concerning the violation of human rights in
Chile continue to be directed at the Junta. Most recently, a United
Nations report on Chile charged that "torture centers" are being op-
erated in Santiago and other parts of the country. The lengthy docu-
ment, issued October 14, 1975, listed 11 centers where it says prisoners
are being questioned "by methods amounting to torture." The Pinochet
government had originally offered full cooperation to the U.N. group,
including complete freedom of movement in Chile. However, six days
before the group's arrival in Santiago, the go vernment reversed itself
and notified the group that the visit was cancelled.








2. CIA Post-Coup Activities in Chile
The covert action budget for Chile was cut back sharply after the
coup and all the anti-Allende projects except for one, a major pro-
paganda project, were terminated. Covert activities in Chile following
the coup were either continuations or adaptations of earlier projects,
rather than major new initiatives.
The goal of covert action immediately following the coup was to
assist the Junta in gaining a more positive image, both at home and
abroad, and to maintain access to the command levels of the Chilean
government. Another goal, achieved in part through work done at the
opposition research organization before the coup, was to help the new
government organize and implement new policies. Project files record
that CIA collaborators were involved in preparing an initial overall
economic plan which has served as the basis for the Junta's most im-
portant economic decisions.
With regard to the continuing propaganda project, a number of
activities, including the production of books, a mailing effort, a mili-
tary collection program, and the media coordination effort were ter-
minated. However, access to certain Chilean media outlets was retained
in order to enable the CIA Station in Santiago to help build Chilean
public support for the new government as well as to influence the direc-
tion of the government, through pressures exerted by the mass media.
These media outlets attempted to present the Junta in the most
positive light for the Chilean public and to assist foreign journalists
in Chile to obtain facts about the local situation. Further, two CIA col-
laborators assisted the Junta in preparing a White Book of the Change
of Government in Chile. The White Book, published by the Junta
shortly after the coup, was written to justify the overthrow of Al-
lende. It was distributed widely both in Washington and in other
foreign capitals.
After the coup, the CIA renewed liaison relations with the Chilean
government's security and intelligence forces, relations which had been
disrupted during the Allende period. Concern was expressed within
the CIA that liaison with such organizations would lay the Agency
open to charges of aiding political repression; officials acknowledged
that, while most of CIA's support to the various Chilean forces would
be designed to assist them in controlling subversion from abroad, the
support could be adaptable to the control of internal subversion as
well. However, the CIA made it clear to the Chileans at the outset
that no CIA support would be provided for use in internal political
repression. Furthermore, the CIA attempted to influence the Junta
to maintain the norms the Junta had set in its "Instructions for
Handling of Detainees" which closely followed the standards on
human rights set by the 1949 Geneva Convention.












IV. Chile: Authorization, Assessment, and Oversight

A. 40 COMMITTEE AUTHORIZATION AND CONTROL: CHILE, 1969-1973
1. 40 Committee Functions and Procedures
Throughout its history, the 40 Committee and its direct predeces-
sors-the 303 Committee and the Special Group-have had one over-
riding purpose; to exercise political control over covert operations
abroad. The 40 Committee is charged with considering the objectives
of any proposed activity, whether or not it would accomplish these
aims, and in general whether or not it would be "proper" and in the
American interest. Minutes and summaries of 40 Committee meetings
on Chile indicate that, by and large, these considerations were dis-
cussed and occasionally debated by 40 Committee members.
In addition to exercising political control, the 40 Committee has
been responsible for framing covert operations in such a way that they
could later be "disavowed" or "plausibly denied" by the United
States government-or at least by the President. In the case of Chile,
of course, this proved to be an impossible task. Not only was CIA
involvement in Chile "blown," but in September 1974, President Ford
publicly acknowledged at a press conference U.S. covert involvement
in Chile.
Before covert action proposals are presented to the Director for
submission to the 40 Committee, an internal CIA instruction states
that they should be coordinated with the Department of State and
that, ordinarily, concurrence by the ambassador to the country con-
cerned is required. "Should," and "ordinarily" were underscored for
an important reason-major covert action proposals are not always co-
ordinated among the various agencies. Nor, for that matter, are they
always discussed and/or approved by the 40 Committee. The Chile
case demonstrates that in at least one instance, the so-called Track
II activity, the President instructed the CIA not to inform nor coordi-
nate this activity with the Departments of State or Defense or the
ambassador in the field. Nor was the 40 Committee ever informed.
Not all covert activities are approved by the 40 Committee. Projects
not deemed politically risky or involving large sums of money can be
approved within the CIA. By CIA statistics, only about one-fourth
of all covert action projects are considered by the 40 Committee. The
Committee has not been able to determine what percentage of covert
action projects conducted by the CIA in Chile were approved within
the CIA or required 40 Committee authorization. Despite this fact, the
Committee has found evidence of projects not considered by the 40
Committee, thus conforming to this general authorization rule. This
is not to imply that the CIA undertook activities in Chile behind the
back of the 40 Committee or without its approval. The Agency was








simply following the authorization procedures for covert projects
that then existed. These same procedures exist today.
There have been numerous criticisms of 40 Committee procedures,
some of which follow:
The criteria by which covert operations are brought before the
40 Committee appear to be fuzzy. The real degree of accountabil-
ity for covert actions remains to be determined.
There is a basic conflict between sufficient consultation to insure
accountability and sound decisions on the one hand, and secure
operations on the other. The risk of inadequate consultation may
be aggravated by the more informal procedure of telephone clear-
ances, which has been used by the 40 Committee for the last few
years.
The review of covert actions by the 40 Committee does not
appear to be searching or thorough. There still appears to be a
serious risk that operations will end only when they come to grief.

2. 40 Committee Approvals

According to a chronology of 40 Committee meetings, the Commit-
tee met on 23 separate occasions between March 1970 and October 1973
to authorize funds for covert activities in Chile.' During this period,
the Committee authorized a total of $8.8 million for CIA covert activi-
ties in Chile. Of this amount, $6.5 million was spent.
The range of CIA activities in Chile approved by the 40 Committee
included "spoiling" operations against Allende prior to the September
4th election, assistance to Chilean political parties, a contingency fund
for Ambassador Korry's use to influence the October 24 congres-
sional vote, purchase of a Chilean radio station to be used as a political
opposition instrument against Allende, assistance to specific political
candidates, emergency aid to keep the Santiago paper, El Mercurio,
afloat, and support for an anti-Allende businessmen's association.

3. Policy Splits Within the 40 Committee
Unanimity was not a hallmark of 40 Committee meetings on Chile,
at least during the period April 1969 to October 1970. Stated simply,
the State Department was generally skeptical about intervening in the
Chilean electoral process, whereas the CIA, the U.S. Ambassador t6
Chile, the Defense Department, and the White House favored
intervention.
The question of whether anything should be done with regard to
the September 1970 presidential election in Chile was first raised at a
meeting of the 303 Committee on April 15, 1969. It was not until
December 1969, however, that a joint Embassy-CIA proposal for a
campaign directed against Allende was submitted to the Committee.
At this December meeting, two State Department officials questioned
SThe use of the term "40 Committee meetings" must not be taken in a literal sense.
At the outset of the Nixon Administration, the 40 Committee did meet frequently to discuss
and approve, as well as review, U.S. covert activities. However, within a relatively short
period of time, these formal meetings of the 40 Committee were replaced by less frequent
meetings and a system of telephone clearances. Today the 40 Committee rarely meets. Covert
action proposals, prepared by the DCI, are distributed to the various 40 Committee princi-
pals and approvals or disapprovals are obtained over the phone by the 40 Committee
Special Group officer, a CIA officer on loan to the NSC staff.








the need for U.S. involvement in the election. One State official com-
mented that an Allende victory would not be the same as a Communist
victory. The U.S. Ambassador to Chile, Edward Korry, who had been
recalled for consultation, disagreed. He stated that operationally one
must treat an Allende victory as the same thing as a Communist vic-
tory. Korry went on to state that, in his view, an Allende government
would be worse than a. Castro government.
On March 25, 1970, the 40 Committee approved a "spoiling opera-
tion" against Allende and approved $125,000 for this purpose. Again,
however, the State Department, represented by Under Secretary of
State U. Alexis Johnson, indicated that the Department remained
lukewarm to any involvement in the election and informed the 40 Com-
mittee that the Department would be quite cool to a more positive
approach.
One further example of policy disagreement within the 40 Com-
mittee was evidenced in a summary of a September 29, 1970, 40 Com-
mittee meeting. This meeting occurred a little more than three weeks
after Allende had won his plurality victory on September 4. The ques-
tion of applying economic pressure to Chile was raised, with the hope
that this pressure would create the conditions which would lead to a
military coup. After a run-through of possible economic pressures that
could be brought to bear on Chile, provided by the CIA's Deputy
Director for Plans Thomas Karamessines, Under Secretary of State
Johnson noted that to swerve from 40 Committee-type action to eco-
nomic warfare was tantamount to a change in foreign policy. Despite
this concern, the 40 Committee did decide to increase economic pres-
sures in Chile. The State Department was not happy with this turn of
events. Assistant Secretary of State Charles Meyer remarked that
should Allende be confirmed, the U.S. could place the burden on
Allende for all that he did, and, after all, he would not be around for-
ever. This view was not accepted by the CIA. Director Helms remarked
at the meeting that Allende's Marxist pronouncements should be taken
at face value while Karamessines added that a hands-off policy in
Chile at this time would be read as the U.S. throwing in the sponge.
As evidenced by later 40 Committee authorizations, the sponge was
not thrown in.

B. INTELLIGENCE ESTIMATES AND COVERT ACTION
The intelligence community produces several kinds of assessments
for policy makers. Of these, the most important are National Intel-
ligence Estimates (NIEs)-joint, agreed assessment of foreign
politics and capabilities-produced by the U.S. intelligence com-
munity. This section, based on a review of NIEs and other intelligence
memoranda 2 regarding Chile written during 1969-1973, will trace the
intelligence community's best estimates of what an Allende govern-
ment signified for U.S. interests.
NIEs are approved by the United States Intelligence Board
(USIB) ; dissenting agencies can register footnotes. Prior to 1973,
a formal Board of National Estimates supervised the production of
2 These include Intelligence Memoranda produced by the CIA's Office of Current Intel-
ligence (OCI) and Intelligence Notes produced by the State Department's Bureau of
Intelligence and Research (INR).








drafts by a special Office of National Estimates. In 1973, that struc-
ture was replaced by a system of National Intelligence Officers
(NIOs), senior analysts drawn from the CIA and other intelligence
agencies.
There have been persistent criticisms of NIEs and many of these
remain with the new structure: the documents are least-common-de-
nominator compromises and thus are of little value to policy makers;
they are oriented toward short-range predictions rather than long-
run assessments. Another criticism deals not with the NIEs them-
selves but with their use or abuse. It is charged that policy makers
ignore NIEs or consult them only when estimates confirm their pre-
existing policy preferences.

1. The Chile Estimbates
Between 1969 and 1973, five Chile NIEs were produced, one in each
year. In addition, several Intelligence Memoranda and Intelligence
Notes relating to Chile were prepared by CIA and State. The likely
policies and goals of an Allende administration, as predicted by the
intelligence community, follow.
A. CILE UNDER ALLENDE
A July 1970 Chile NIE, prepared a little over a month before the
September election, raised the question of what an Allende victory
would mean to Chile and the United States. The NIE occasioned con-
siderable disagreement within the Washington community. The dis-
agreement reflected a division between the Department of State on one
side and the U.S. Ambassador and the CIA Station on the other. The
latter position was that an Allende victory would mean the gradual
imposition of a classic Marxist-Leninist regime in Chile. This position
was reflected, with some qualifying remarks, in the NIE.
The 1970 NIE stated, in strong terms, that an Allende administra-
tion would proceed as rapidly as possible toward the establishment
of a Marxist-Socialist state. It would be a Chilean version of a Soviet-
style East European Communist state. The intelligence community pre-
dicted that although democracy was likely to survive in Chile over
the next two or three years, Allende could take Chile a long way down
the Marxist-Socialist road during the six years of his administration.
To do this, however, he would have to surmount some very important
obstacles, such as Chile's security forces, the Christian Democratic
Party, some elements of organized labor, the Congress, and the Catho-
lic Church. The NIE noted that Allende undoubtedly expected prog-
ress on basic bread and butter issues which would afford him an op-
portunity to secure control of the Congress in the 1973 election and
thereby enable him to impose a socialist state of the Marxist variety by
the via pacifica ("peaceful road").
The next NIE issued on Chile, in August 1971, was less shrill on
the threat which Allende represented to Chilean democracy. He had
been in office nine months. The NIE stated that the consolidation
of Marxist political leadership in Chile was not inevitable and that
Allende had a long, hard way to go to achieve this. The NIE warned,
however, that although Allende would almost certainly prefer to ad-








here to constitutional means, he was likely to be impelled to use politi-
cal techniques of increasingly dubious legality to perpetuate his coali-
tion and power. Up to that point, the NIE observed, Allende had taken
great care to observe constitutional forms and was enjoying consider-
able popularity in Chile.
The next NIE came out in June 1972. The prospects for the con-
tinuation of democracy in Chile appeared to be better than at any time
since Allende's inauguration. The NIE stated that the traditional
political system in Chile continued to demonstrate remarkable resi-
liency. Legislative, student, and trade union elections continued to
take place in normal fashion, with pro-government forces accepting
the results when they were adverse. The NIE noted that the Christian
Democratic Party and the National Party had used their combined
control of both Houses of Congress to stall government initiatives and
to pass legislation designed to curtail Allende's powers. In addition,
the opposition news media had been able to resist government intimida-
tion and persisted in denouncing the government. The NIE concluded
that the most likely course of events in Chile for the next year or so
would be moves by Allende toward slowing the pace of his revolution
in order to accommodate the opposition and to preserve the gains he
had already made.
One final NIE on Chile was issued prior to Allende's overthrow in
September 1973. That NIE focused on the prospects for the consolida-
tion of power by Allende's regime. It concluded that at that juncture
a political standoff seemed to be the most likely course of events in
Chile. The NIE stated that Allende had not consolidated the power
of his Marxist regime; the bulk of low-income Chileans believed that
he had improved their conditions and represented their interests; and
the growth in support for his coalition reflected his political ability
as well as the popularity of his measures. The NIE did warn, how-
ever, that the growing polarization of the Chilean society was wearing
away the Chilean predilection for political compromise. Nevertheless,
the analysts predicted that there was only an outside chance that the
military would move to force Allende from office.

B. U.S.-CHILEAN RELATIONS
Almost two years before Allende was elected, the intelligence com-
munity predicted that future U.S.-Chilean relations would be under
repeated strains, regardless of which party won the 1970 presidential
election. A 1969 NIE stated that whoever succeeded Frei in the presi-
dency was likely to continue to stress Chilean independence, to be less
cooperative with the U.S. than Frei had been, and to explore somewhat
broader relations with communist countries. This NIE noted that were
Allende to win, his administration would almost certainly take steps
aimed at moving Chile away from the U.S. The NIE also observed that
steps toward either government participation in or outright nationali-
zation of U.S. copper holdings in Chile were inevitable.
A 1970 NIE, issued one month before Allende's September victory,
was quite pessimistic about future U.S.-Chilean relations. It stated
that if Allende were to win the election, he would almost certainly take
harsh measures against U.S. business interests in Chile and challenge
U.S. policies in the hemisphere. The NIE cited several foreign policy








problems an Allende regime would pose for the U.S., including recog-
nition of Cuba, possible withdrawal from the OAS, the deterioration
of relations with Argentina, and anti-U.S. votes in the United Nations.
The NIE predicted, however, that Allende would probably not seek a
break with the United States over the next two years.
A 1971 NIE, issued ten months into Allende's term in office, stated
that U.S.-Chilean relations were dominated by the problems of na-
tionalization, although Allende himself seemed to wish to avoid a
confrontation. A 1972 Chile NIE noted that Allende, to date, had
sought to avoid irreparable damage to his relations with Washing-
ton. Although the major problem concerning U.S.-Chilean relations
continued to be that of compensation for the nationalization of U.S.
companies, the 1972 NIE stated that Allende had taken pains to pub-
licly stress his desire for amicable relations. A 1973 NIE concluded
that Allende had kept lines open to Washington on possible Chilean
compensation for expropriated U.S. copper companies.

C. ALLENDE'S RELATIONS WITH SOCIALIST COUNTRIES
The 1969 Chile NIE predicted that any new administration would
explore somewhat broader relations with communist and socialist
countries. The NIE noted that Allende, in particular, would take
such steps but that even he would be deterred from moving too far
in this direction due to a Chilean nationalism which would as strongly
oppose subordinating Chile to the tutelage of Moscow or Havana as
to Washington. Allende did, over the years, expand Chile's relations
with socialist and communist countries. However, Allende was, as
a 1971 NIE stated, careful not to subordinate Chilean interests to any
communist or socialist power or to break existing ties with non-com-
munist nations on whom he continued to rely for aid. Chile NIEs in
1971 and 1972 emphasized that Allende was charting an independent,
nationalistic course, both within the hemisphere and internationally.
Allende was, in short, committed to a policy of non-alignment.
D. ALLENDE'S TIES WITI CUBA
The 1970 NIE on Chile predicted that Allende would recognize
Cuba. He did so, shortly after he was inaugurated. However, the pat-
tern of Chilean-Cuban relations was described in a 1971 NIE as one
of ideological distance and closer economic ties. The NIE stated that
despite Allende's long-standing personal relationship with Castro, he
had refrained from excessive overtures to him. A 1972 NIE noted
that Havana had been circumspect about trying to use Chile as a base
for promoting revolution throughout Latin America.
E. SOVIET INFLUENCE IN CHILE
Concern about the expansion of Soviet influence in Chile under
Allende and the possible establishment of a major Soviet military
presence was expressed in 1970. A 1971 NIE predicted that although
the Soviet Union would continue to cultivate channels of influence into
Allende's government through the Chilean Communist Party, it would
probably be unsure of its ability to make a decisive impact on key








issues given Allende's desire for an independent posture. The same
NIE noted that neither Allende nor the Chilean military establish-
ment would probably tolerate a permanent Soviet military presence
in Chile. A 1972 Chile NIE focused on the Soviet attitude to the
Allende regime and noted that Soviet overtures to Allende had thus
far been characterized by caution and restraint. This was, in part,
due to Soviet reluctance to antagonize the U.S. and, more importantly,
a Soviet desire to avoid with Allende the type of open-ended commit-
ment for aid that they had entered into with Castro. A 1972 Intelli-
gence. Note, prepared by the State Department, stated that a Soviet-
Chilean communique, issued following Allende's December visit to the
USSR, reflected Moscow's decision to continue a cautious policy to-
ward Chile and to avoid a major open-ended commitment of aid to
Allende. According to the Intelligence Note, the Soviets apparently ad-
vised Allende to negotiate his differences with the U.S.

F. CHILE AS A BASE FOR LATIN AMERICAN SUBVERSION
Prior to Allende's election, concern was expressed about Chilean
subversion in other countries. An Intelligence Memorandum, prepared
by the CIA and issued shortly after Allende's September 4 plurality
victory, stated that Chile had long been a relatively open country for
extreme leftists and would become even more so under Allende. The
Memorandum noted, however, that Allende would be cautious in pro-
viding assistance to extremists for fear of provoking a military reac-
tion in his own country. The Memorandum went on to observe that the
degree to which revolutionary groups would be allowed to use Chile
as a base of operations would be limited to some extent by the orthodox
Communist Party in Chile which opposed violence-prone groups. A
State Department Intelligence Note, prepared in June 1971, stated
that, contrary to some earlier indications that Allende might provide
clandestine assistance to neighboring insurgency movements, evidence
to date suggested that he had been sensitive to the concerns of neigh-
boring governments and had sought to avoid action which would
strain bilateral relations. The Intelligence Note stated that Chile had
warned Argentine and Mexican expatriates that they could reside in
Chile only if they did not engage in political activities and that some
of the more politically active Brazilian exiles had been encouraged to
depart Chile. The Note concluded by predicting that it was unlikely
that Allende would provide financial support or training to facilitate
the export of insurgency. A 1972 NIE stated that Allende had gone
to great lengths to convince his Latin American neighbors that he did
not share Castro's revolutionary goals; although some revolutionaries
in Chile had received arms and funds from extremists in Allende's
political coalition, this had probably not occurred at his behest.

G. THREAT ASSESSMENT
The most direct statement concerning the threat an Allende regime
would pose to the United States was contained in a CIA Intelligence
Memorandum, issued shortly after Allende's September 4 election vic-
tory. The Memorandum summarized the views of the Interdepart-
mental Group for Inter-American Affairs, which prepared the re-








sponse to National Security Study Memorandum 97. The Group, made
up of officials representing CIA, State, Defense, and the White House,
concluded that the United States had no vital interests within Chile,
the world military balance of power would not be significantly altered
by an Allende regime, and an Allende victory in Chile would not pose
any likely threat to the peace of the region. The Group noted, however,
that an Allende victory would threaten hemispheric cohesion and
would represent a psychological setback to the U.S. as well as a definite
advance for the Marxist idea.

2. Estimates and Covert Action
As a result of this look at the Chile estimates, a number of comments
can be made concerning them and their relation to decisions about
covert action:
(a) Despite the view expressed by the Interdepartmental Group,
and reported in a CIA Intelligence Memorandum, that the U.S. had
no vital national interest in Chile, the decision was made by the Execu-
tive Branch to intervene in that nation's internal political and economic
affairs, before the election, between it and the congressional vote and
during Allende's tenure in office.
It appears that the Chile NIEs were either, at best, selectively used
or, at worst, disregarded by policy makers when the time came to make
decisions regarding U.S. covert involvement in Chile. 40 Committee
decisions regarding Chile reflected greater concern about the internal
and international consequences of an Allende government than was re-
flected in the intelligence estimates. At the same time as the Chile
NIEs were becoming less shrill, the 40 Committee authorized greater
amounts of money for covert operations in Chile. The amounts author-
ized by the 40 Committee rose from $1.5 million in 1970 to $3.6 million
in 1971, $2.5 million in 1972, and, during the first eight months of 1973,
$1.2 million. Covert action decisions were not, in short, entirely con-
sistent with intelligence estimates.
(b) As noted, NIEs are designed to provide economic and political
assessments and an analysis of trends. As such, they are vulnerable
to being interpreted by policymakers to support whatever conclusions
the policymakers wish to draw from them. The estimates do, however,
serve to narrow the range of uncertainty about future events in Chile,
and thus narrow the range of justifiable U.S. policies. But a range
remained.
For example, a 1971 estimate stated that, on the one hand, Allende
was moving skillfully and confidently toward his declared goal of
building a revolutionary nationalistic, socialist society on Marxist prin-
ciples, but, on the other hand, the consolidation of the Marxist politi-
cal leadership in Chile was not inevitable, and Allende had a long,
hard way to go to achieve this. As a further example, a 1973 NIE which
addressed the possibility of enhanced Soviet influence in Chile stated
that the Soviets were interested both in increasing their influence in
South America and in Allende's successful coalition of leftist parties
as a model for a Marxist revolution through election. Yet, the estimate
went on to say that the Soviets did not want another Cuba on their
hands and they were reluctant to antagonize the U.S.








(c) The Committee has determined that the analysts responsible
for drawing up the Chile NIEs were not privy to information con-
cerning covert operations approved by the 40 Committee and being
implemented in Chile by the CIA operators. The explanation for this
is CIA compartmentation. Analysts and operators often exist in sepa-
rate worlds. Information available to the Operations Directorate is
not always available to the Intelligence Directorate. As a result, those
who were responsible for preparing NIEs on Chile appear not to have
had access to certain information which could have added to, or sub-
stantially revised, their assessments and predictions. That flaw was
telling. It meant, for example, that the 1972 assessment of the durability
of opposition sectors was written without knowledge of covert Ameri-
can funding of precisely those sectors. Thus, there was no estimate of
whether those sectors would survive absent U.S. money.

C. CONGRESSIONAL OVERSIGHT
With regard to covert action in Chile between April 1964 and Decem-
ber 1974, CIA's consultation with its Congressional oversight com-
mittees-and thus Congress' exercise of its oversight function-was
inadequate. The CIA did not volunteer detailed information; Congress
most often did not seek it.
Beginning in 1973, numerous public allegations were made concern-
ing activities undertaken by the CIA in Chile. In response, Congress
began to assume greater control in the exercise of its oversight func-
tion-which it had badly neglected in the past-both in the number
and depth of consultations with the Central Intelligence Agency. Prior
to 1973 there were twenty meetings between Congressional committees
and the CIA regarding Chile; these meetings were held with the
House and Senate Armed Services and Appropriation Committees
in their Intelligence Subcommittees. From March 1973 to December
1974 there were thirteen meetings held not only with these Commit-
tees, but also before the Senate Foreign Relations Subcommittee on
Multinational Corporations and the House Foreign Affairs Subcom-
mittee on Inter-American Affairs.
Based on CIA records, there were a total of fifty-three CIA Con-
gressional briefings on Chile between 1964 and 1974. At thirty-one
of these meetings, there was some discussion of covert action; special
releases of funds for covert action were discussed at twenty-three of
them. After January 1973 these briefings were concerned with past
CIA covert activity. From information currently in the possession
of the Committee and public sources, several tentative conclusions
emerge: on several important occasions the CIA did not report on
covert action until quite long after the fact; and in one case-Track
II-it omitted discussion of an important, closely held operation,
but one whose outcome reverberated on the foreign policy of the
United States and carried implications for domestic affairs as well.
Of the thirty-three covert action projects undertaken in Chile with
40 Committee approval during the period 1963-1974, Congress was
briefed in some fashion on eight.3 Presumbly the twenty-five others
were undertaken without Congressional consultation. These twenty-
Under section 622 of the Foreign Assistance Act of 1974, the Director of Central
Intelligence is required to notify six Congressional oversight committees of every 40
Committee approval once the President has issued a finding that the project is necessary
for the national security of the United States.






50

five projects included: the $1.2 million authorization in 1971, half of
which was spent to purchase radio stations and newspapers while the
other half went to support municipal candidates and anti-Allende
political parties; and the additional expenditure of $815,000 in late
1971 to provide support to opposition parties.
Of the total of over thirteen million dollars actually spent by the
CIA on covert action operations in Chile between 1963 and 1974, Con-
gress received some kind of briefing (sometimes before, sometimes
after the fact) on projects totaling about 7.1 million dollars. Further,
Congressional oversight committees were not consulted about projects
which were not reviewed by the full 40 Committee. One of these was
the Track II attempt to foment a military coup in 1970. The other-
a later CIA project involving contacts with Chilean military officers-
was an intelligence collection project and thus did not come before the
40 Committee, even though in this instance the political importance of
the project was clear.












V. Preliminary Conclusions
Underlying all discussion of American interference in the internal
affairs of Chile is the basic question of why the United States ini-
tially mounted such an extensive covert action program in Chile-and
why it continued, and even expanded, in the early 1970s.
Covert action has been a key element of U.S. foreign policy toward
Chile. The link between covert action and foreign policy was obvious
throughout the decade between 1964 and 1974. In 1964, the United
States commitment to democratic reform via the Alliance for Progress
and overt foreign aid was buttressed via covert support for the elec-
tion of the candidate of the Christian Democratic party, a candidate
and a party for which the Alliance seemed tailor made. During 1970
the U.S. Government tried, covertly, to prevent Allende from becom-
ing President of Chile. When that failed, covert support to his oppo-
sition formed one of a triad of official actions: covert aid to opposition
forces, "cool but correct" diplomatic posture, and economic pressure.
From support of what the United States considered to be democratic
and progressive forces in Chile we had moved finally to advocating
and encouraging the overthrow of a democratically elected govern-
ment.
A. COVERT ACTION AND U.S. FOREIGN POLICY
In 1964, the United States became massively involved in covert
activity in Chile. This involvement was seen by U.S. policy-makers as
consistent with overall American foreign policy and the goals of the
Alliance for Progress. The election of a moderate left candidate in
Chile was a cornerstone of U.S. policy toward Latin America.
It is unclear from the record whether the 1964 election project was
intended to be a one-time intervention in support of a good cause. It
is clear that the scale of the involvement generated commitments and
expectations on both sides. For the United States, it created assets
and channels of funding which could be used again. For the Chilean
groups receiving CIA funds, that funding became an expectation,
counted upon. Thus, when opposition to Allende became the primary
objective of covert action in 1970, the structure for covert action de-
veloped through covert assistance to political parties in 1964 was well
established.
A fundamental question raised by the pattern of U.S. covert acti-
vities persists: Did the threat to vital U.S. national security interests
posed by the Presidency of Salvador Allende justify the several major
covert attempts to prevent his accession to power? Three American
Presidents and their senior advisors evidently thought so.
One rationale for covert intervention in Chilean politics was spelled
out by Henry Kissinger in his background briefing to the press on
September 16, 1970, the day after Nixon's meeting with Helms. He
argued that an Allende victory would be irreversible within Chile,
might affect neighboring nations and would pose "massive problems"
for the U.S. in Latin America:







I have yet to meet somebody who firmly believes that if Allende
wins, there is likely to be another free election in Chile. ... Now it
is fairly easy for one to predict that if Allende wins, there is a good
chance that he will establish over a period of years some sort of
communist government. In that case, we would have one not on an
island off the coast (Cuba) which has not a traditional relation-
ship and impact on Latin America, but in a major Latin American
country you would have a communist government, joining, for
example, Argentine ... Peru ... and Bolivia.... So I don't think
we should delude ourselves on anAllende takeover and Chile would
not present massive problems for us, and for democratic forces
and for pro-U.S. forces in Latin America, and indeed to the whole
Western Hemisphere.
Another rationale for U.S. involvement in the internal affairs of
Chile was offered by a high-ranking official who testified before the
Committee. He spoke of Chile's position in a worldwide strategic chess
game in 1970. In this analogy, Portugal might be a bishop, Chile a
couple of pawns, perhaps more. In the worldwide strategic chess
game, once a position was lost, a series of consequences followed. U.S.
enemies would proceed to exploit the new opportunity, and our ability
to cope with the challenge would be limited by any American loss.

B. EXECUTIVE COMMAND AND CONTROL OF MAJOR COVERT ACTION
In pursuing the Chilean chess game, particularly the efforts to pre-
vent Allende's accession to power or his maintaining power once
elected, Executive command and control of major covert action was
tight and well directed. Procedures within the CIA for controlling
the programs were well defined and the procedures made Station of-
ficials accountable to their supervisors in Washington. Unilateral ac-
tions on the part of the Station were virtually impossible.
But the central issue of command and control is accountability:
procedures for insuring that covert actions are and remain accountable
both to the senior political and foreign policy officials of the Executive
Branch and to the Congress.
The record of covert activities in Chile suggests that, although es-
tablished executive processes of authorization and control were gen-
erally adhered to, there were-and remain-genuine shortcomings to
these processes:
Decisions about which covert action projects are submitted to the 40
Committee were and are made within the CIA on the basis of the
Agency's determination of the political sensitivity of a project.
The form in which covert action projects were cleared with Ambas-
sadors and other State Department officials varied. It depended-and
still depends-on how interested Ambassadors are and how forthcom-
ing their Station Chiefs are.
Once major projects are approved by the 40 Committee, they often
continue without searching re-examination by the Committee. The
Agency conducts annual reviews of on-going projects, but the 40 Com-
mittee does not undertake a review unless a project is recommended
for renewal, or there is some important change in content or amount.
There is also the problem of controlling clandestine projects not
labeled "covert action." Clandestine collection of human intelligence








is not the subject of 40 Committee review. But those projects may be
just as politically sensitive as a "covert action"; witness U.S. contacts
with the Chilean military during 1970-73. Similarly, for security
reasons, ambassadors generally know CIA assets only by general de-
scription, not by name. That practice may be acceptable, provided
the description is detailed enough to inform the ambassador of the
risk posed by the development of a particular assets and to allow
the ambassador to decide whether or not that asset should be used.
There remains the question of the dangers which arise when the
very mechanisms established by the Executive Branch for insuring
internal accountability are circumvented or frustrated.
By Presidential instruction, Track II was to be operated without
informing the U.S. Ambassador in Santiago, the State Department,
or any 40 Committee member save Henry Kissinger. The President
and his senior advisors thus denied themselves the Government's major
sources of counsel about Chilean politics. And the Ambassador in
Santiago was left in the position of having to deal with any adverse
political spill-over from a project of which he was not informed.
The danger was greater still. Whatever the truth about communica-
tion between the CIA and the White House after October 15, 1970-
an issue which is the subject of conflicting testimony-all participants
agreed that Track II constituted a broad mandate to the CIA. The
Agency was given to believe it had virtual carte blanche authority;
moreover, it felt under extreme pressure to prevent Allende from com-
ing to power, by military coup if necessary. It was given little guid-
ance about what subsequent clearances it needed to obtain from
the White House. Under these conditions, CIA consultation with the
White House in advance of specific actions was less than meticulous.
C. THE ROLE OF CONGRESS
In the hands of Congress rests the responsibility for insuring that
the Executive Branch is held to full political accountability for covert
activities. The record on Chile is mixed and muted by its incomplete-
ness.
CIA records note a number of briefings of Congressional commit-
tees about covert action in Chile. Those records, however, do not re-
veal the timeliness or the level of detail of these briefings. Indeed, the
record suggests that the briefings were often after the fact and in-
complete. The situation improved after 1973, apparently as Congres-
sional committees became more persistent in the exercise of their over-
sight function. Furthermore, Sec. 662 of the Foreign Assistance Act
should make it impossible for major projects to be operated without
the appropriate Congressional committees being informed.
The record leaves unanswered a number of questions. These per-
tain both to how forthcoming the Agency was and how interested
and persistent the Congressional committees were. Were members
of Congress, for instance, given the opportunity to object to specific
projects before the projects were implemented? Did they want to?
There is also an issue of jurisdiction. CIA and State Department
officials have taken the position that they are authorized to reveal
Agency operations only to the appropriate oversight committees.








D. INTELLIGENCE JUDGMENTS AND COVERT OPERATIONS
A review of the intelligence judgments on Chile offered by U.S.
analysts during the critical period from 1970-1973 has not established
whether these judgments were taken into account when U.S. policy-
makers formulated and approved U.S. covert operations. This
examination of the relevant intelligence estimates and memoranda
has established that the judgments of the analysts suggested caution
and restraint while the political imperatives demanded action.
Even within the Central Intelligence Agency, processes for bring-
ing considered judgments of intelligence analysts to bear on proposed
covert actions were haphazard-and generally ineffective. This situa-
tion has improved; covert action proposals now regularly come before
the Deputy Director for Intelligence and the appropriate National
Intelligence Officer; but the operators still are separated from the
intelligence analysts, those whose exclusive business it is to understand
and predict foreign politics. For instance, the analysts who drafted the
government's most prestigious intelligence analyses-NIEs-may not
even have known of U.S. covert actions in Chile.
The Chilean experience does suggest that the Committee give ser-
ious consideration to the possibility that lodging the responsibility
for national estimates and conduct of operational activities with the
same person-the Director of Central Intelligence-creates an in-
herent conflict of interest and judgment.

E. EFFECTS OF MAJOR COVERT ACTION PROGRAMS
Covert Action programs as costly and as complex as several mounted
by the United States in Chile are unlikely to remain covert. In Chile
in 1964, there was simply too much unexplained money, too many
leaflets, too many broadcasts. That the United States was involved in
the election has been taken for granted in Latin America for many
years.
The involvement in 1964 created a presumption in Chile and else-
where in Latin America that the United States Government would
again be involved in 1970. This made secrecy still harder to maintain,
even though the CIA involvement was much smaller in 1970 than
it had been in 1964.
When covert actions in Chile became public knowledge, the costs
were obvious. The United States was seen, by its covert actions, to
have contradicted not only its official declarations but its treaty com-
mitments and principles of long standing. At the same time it was
proclaiming a "low profile" in Latin American relations, the U.S.
Government was seeking to foment a coup in Chile.
The costs of major covert ventures which are "blown" are clear
enough. But there may be costs to pay even if the operations could
remain secret for long periods of time. Some of these costs may
accrue even within the calculus of covert operations: successes may
turn to failures. Several officials from whom the Committee took
testimony suggested that the poor showing of the Chilean Christian
Democrats in 1970 was, in some part, attributable to previous Ameri-
can covert support. Of course there were many causes of that poor
showing, but in 1964 the PDC had been spared the need of develop-








ing some of its own grass roots organization. The CIA did much of
that for it. In 1970, with less CIA activity on behalf of the Christian
Democratic Party, the PDC faltered.
Of course, the more important costs, even of covert actions which
remain secret, are those to American ideals of relations among nations
and of constitutional government. In the case of Chile, some of those
costs were far from abstract: witness the involvement of United
States military officers in the Track II attempt to overthrow a con-
stitutionally-elected civilian government.
There are also long-term effects of covert actions. Many of those
may be adverse. They touch American as well as foreign institutions.
The Chilean institutions that the United States most favored may
have been discredited within their own societies by the fact of their
covert support. In Latin America particularly, even the suspicion of
CIA support may be the kiss of death. It would be the final irony of
a decade of covert action in Chile if that action destroyed the credi-
bility of the Chilean Christian Democrats.
The effects on American institutions are less obvious but no less im-
portant. U.S. private and governmental institutions with overt, legiti-
mate purposes of their own may have been discredited by the
pervasiveness of covert action. Even if particular institutions were not
involved in covert action, they may have been corrupted in the percep-
tion of Latin Americans because of the pervasiveness of clandestine
U.S. activity.
In the end, the whole of U.S. policy making may be affected. The
availability of an "extra" means may alter officials' assessment of the
costs and rationales of overt policies. It may postpone the day when
outmoded policies are abandoned and new ones adopted. Arguably, the
1964 election project was part of a "progressive" approach to Chile.
The project was justified, if perhaps not actually sustained, by the de-
sire to elect democratic reformers. By 1970, covert action had become
completely defensive in character: to prevent the election of Allende.
The United States professed a "low profile" but at the same time acted
covertly to ensure that the Chilean elections came out right, "low pro-
file" notwithstanding.
A special case for concern is the relationship between intelligence
agencies and multinational corporations.
In 1970, U.S. Government policy prohibited covert CIA support to
a single party or candidate. At the same time, the CIA provided ad-
vice to an American-based multinational corporation on how to fur-
nish just such direct support. That raised all of the dangers of ex-
posure, and eliminated many of the safeguards and controls normally
present in exclusively CIA covert operations. There was the appear-
ance of an improperly close relationship between the CIA and multi-
national companies when former Director John McCone used contacts
and information gained while at the CIA to advise a corporation on
whose Board of Directors he sat. This appearance was heightened be-
cause the contacts between the Agency and the corporation in 1970
extended to discussing and even planning corporate intervention in
the Chilean electoral process.
The problem of cooperation is exacerbated when a cooperating com-
pany-such as ITT-is called to give testimony before an appropriate
Congressional Committee. The Agency may then be confronted with








the question of whether to come forward to set the record straight
when it believes that testimony given on behalf of a cooperating com-
pany is untrue. The situation is difficult, for in coming forward the
Agency may reveal sensitive sources and methods by which it learned
the facts or may make public the existence of ongoing covert
operations.
This report does not attempt to offer a final judgment on the po-
litical propriety, the morality, or even the effectiveness of American
covert activity in Chile. Did the threat posed by an Allende presidency
justify covert American involvement in Chile? Did it justify the spe-
cific and unusual attempt to foment a military coup to deny Allende
the presidency? In 1970, the U.S. sought to foster a military coup
in Chile to prevent Allende's accession to power; yet after 1970 the
government-according to the testimony of its officials-did not en-
gage in coup plotting. Was 1970 a mistake, an aberration? Or was the
threat posed to the national security interests of the United States so
grave that the government was remiss in not seeking his downfall di-
rectly during 1970-73? What responsibility does the United States
bear for the cruelty and political suppression that have become the
hallmark of the present regime in Chile?
On these questions Committee members may differ. So may Ameri-
can citizens. Yet the Committee's mandate is less to judge the past
than to recommend for the future. Moving from past cases to future
guidelines, what is important to note is that covert action has been
perceived as a middle ground between diplomatic representation and
the overt use of military force. In the case of Chile, that middle ground
may have been far too broad. Given the costs of covert action, it should
be resorted to only to counter severe threats to the national security of
the United States. It is far from clear that that was the case in Chile.
















Appendix

CHRONOLOGY: CHILE 1962-1975'
1962
Special Group approves $50,000 to strengthen Christian
Democratic Party (PDC) ; subsequently approves an
additional $180,000 to strengthen PDC and its leader,
Eduardo Frei.
1968
Special Group approves $20,000 for a leader of the Radi-
cal Party (PR) ; later approves an additional $30,000
to support PR candidates in April municipal elections.
April 8 Municipal election results show PDC has replaced PR
as Chile's largest party.
1964
April Special Group approves $3,000,000 to ensure election of
PDC candidate Eduardo Frei.
May Special Group approves $160,000 to support PDC slum
dwellers and peasant organizations.
September 4 Eduardo Frei elected President with 55.7 percent of
the vote.
October 2 Ralph A. Dungan appointed U.S. Ambassador to Chile.
1965
303 Committee approves $175,000 to assist selected can-
didates in Congressional elections.
March 7 PDC wins absolute majority in Chamber of Deputies;
becomes largest party in Senate.
November 15 Salvador Allende, in an interview reported in the New
York Times, suggests the U.S. was among certain
"outside forces" that had caused his defeat in the
1964 presidential election.
1967
June 16 Edward M. Korry replaces Ralph A. Dungan as U.S.
Ambassador to Chile.
303 Committee approves $30,000 to strengthen a faction
of the Radical Party.
1968
July 12 303 Committee approves $350,000 to assist selected can-
didates in March 1969 congressional elections.
1969
March 1 Congressional elections reflect an increase in support for
the National Party and a resulting loss in Christian
Democratic strength.
April 15 At a meeting of the 30S Committee the question is raised
as to whether anything should be done with regard to
the September 1970 Presidential election in Chile. The
CIA representative pointed out that an election opera-
tion would not be effective unless an early enough
start was made.
SU.S. actions are italicized throughout.











October 21





March 25

June





June 27

July 16





August 18



September 4






September 8, 14


September 9









September 15



September 16




September 29


1969-Continued
Tacna and Yungay army regiments revolt, ostensibly
for the purposes of dramatizing the military's demand
for higher pay. The revolt, engineered by General
Roberto Viaux, is widely interpreted as an abortive
coup.
1970
40 Committee approves $125,000 for a "spoiling oper-
ation" against Allende's Popular Unity coalition (UP).
The possibility of an Allende victory in Chile is raised at
an ITT Board of Directors meeting. John McCone,
former CIA Director and, at the time, a consultant to
the Agency and a Director of ITT, subsequently holds
a number of conversations regarding Chile with Rich-
ard Helms, the current CIA Director.
40 Committee approves $800,000 for additional anti-
Allende propaganda operations.
John McCone arranges for William Broe (CIA) to talk
with Harold Geneen (ITT). Broe tells Geneen that
CIA cannot disburse ITT funds but promises to ad-
vise ITT on how to channel its own funds. ITT later
passes $350,000 to the Alessandri campaign through
an intermediary.
National Security Study Memorandum (NSSM) 97 is
reviewed by the Interdepartmental Group; the Group
considers options ranging from efforts to forge ami-
cable relations with Allende to opposition to him.
Salvador Allende wins 36.3 percent of the vote in the
Presidential election. Final outcome is dependent on
October 24 vote in Congress between Allende and the
runner-up, Jorge Alessandri, who received 35.3 per-
cent of the vote. Allende's margin of victory was
39,000 votes out of a total of 3,000,000 votes cast in
the election.
40 Committee discusses Chilean situation. The Commit-
tee approves $250,000 for the use of Ambassador
Korry to influence the October 24 Congressional vote.
Harold Geneen, ITT's Chief Executive Officer, tells John
McCone at an ITT Board of Directors meeting in New
York that he is prepared to put up as much as $1 mil-
lion for the purpose of assisting any government plan
designed to form a coalition in the Chilean Congress to
stop Allende. McCone agrees to communicate this
proposal to high Washington officials and meets sev-
eral days later with Henry Kissinger and Richard
Helms. McCone does not receive a response from either
man.
President Nixon instructs CIA Director Helms to pre-
vent Allende's accession to office. The CIA is to play a
direct role in organizing a military coup d'etat. This
involvement comes to be known as Track II.
At an off-the-record White House press briefing, Henry
Kissinger warns that the election of Allende would be
irreversible, might affect neighboring nations, and
would pose "massive problems" for the U.S. and Latin
America.
A CIA official, at the instruction of Richard Helms, meets
with a representative of ITT. The CIA officer proposes
a plan to accelerate economic disorder in Chile. ITT
rejects the proposal.











October





October 14


October 22



October 24

November 3
November 18

November 19


December 21




January 28



February 25



March 22

April 4

May 10



May 20

May 26

July 6

July 11




August 11


September 9

September 28


1970--Continued
CIA contacts Chilean military conspirators; following
a White House meeting, CIA attempts to defuse plot by
retired General Viaux, but still to generate maximum
pressure to overthrow Allende by coup; CIA provides
tear gas grenades and three submachine guns to con-
spirators.
40 Committee approves $60,000 for Ambassador Korry's
proposal to purchase a radio station. The money is
never spent.
After two unsuccessful abduction attempts on October 19
and 20, a third attempt to kidnap Chilean Army
General Rend Schneider results in his being fatally
shot.
The Chilean Congress votes 153 to 35 in favor of Allende
over Alessandri.
Allende is formally inaugurated President of Chile.
40 Committee approves $25,000 for support of Christian
Democratic candidates.
40 Committee approves $725,000 for a covert action pro-
gram in Chile. Approval is later superseded by Janu-
ary 28, 1971, authorization.
President Allende proposes a constitutional amendment
establishing state control of the large mines and auth-
orizing expropriation of all foreign firms working
them.
1971
40 Committee approves $1,240,000 for the purchase of
radio stations and newspapers and to support munici-
pal candidates and other political activities of anti-
Allende parties.
In his annual State of the World message, President
Nixon states, "We are prepared to have the kind of
relationship with the Chilean government that it is
prepared to have with us."
40 Committee approves $185,000 additional support for
the Christian Democratic Party (PDC).
Allende's Popular Unity (UP) coalition garners 49.7 per-
cent of the vote in 280 municipal elections.
40 Committee approves $77,000 for purchase of a press
for the Christian Democratic Party newspaper. The
press is not obtained and the funds are used to sup-
port the paper.
40 Committee approves $100,000 for emergency aid to the
Christian Democratic Party to meet short-term debts.
40 Committee approves $150,000 for additional aid to
Christian Democratic Party to meet debts.
40 Committee approves $150,000 for support of opposition
candidates in a Chilean by-election.
In a joint session of the Chilean Congress, a constitu-
tional amendment is unanimously approved permitting
the nationalization of the copper industry. The amend-
ment provides for compensation to copper companies
within 30 years at not less than 3 percent interest.
The Export-Import Bank denies a Chilean request for
$21 million in loans and loan guarantees needed to
purchase three jets for the national LAN-Chile airline.
40 Committee approves $700,000 for support to the major
Santiago newspaper, El Mercurio.
President Allende announces that "excess profits" will
be deducted from compensation to be paid to national-
ized copper companies.











September 29


September 29

October



November 5


December 1


December 15



January 19








April 11

April 24

May 12


June 16

August 21


September 21

October 10

October 26


December 4





February 12

March 4

March 22


1971-Continued

The Chilean government assumes operation of the
Chilean telephone company (CHITELCO). ITT had
owned 70 percent interest in the company since 1930.
Nathaniel Davis replaces Edward Korry as U.S. Ambas-
sador to Chile.
ITT submits to White House an 18-point plan designed
to assure that Allende "does not get through the
crucial next six months." The ITT proposal is
rejected.
40 Committee approves $815,000 support to opposition
parties and to induce a split in the Popular Unity
coalition.
The Christian Democratic and National Parties orga-
mize the "March of the Empty Pots" by women to
protest food shortages.
40 Committee approves $160,000 to support two opposi-
tion candidates in January 1972 by-elections.

1972
President Nixon issues a statement to clarify U.S. policy
toward foreign expropriation of American interests.
The President states that the United States expects
compensation to be "prompt, adequate, and effective."
The President warns that should compensation not
be reasonable, new bilateral economic aid to the ex-
propriating country might be terminated and the U.S.
would withhold its support from loans under con-
sideration in multilateral development banks.
40 Committee approves $965,000 for additional support
to El Mercurio.
40 Committee approves $50,000 for an effort to splinter
the Popular Unity coalition.
President Allende submits a constitutional amendment
to the Chilean Congress for the expropriation of ITT's
holdings in the Chilean telephone company.
40 Committee approves $46,500 to support a candidate
in a Chilean by-election.
Allende declares a state of emergency in Santiago prov-
ince after violence grows out of a one-day strike by
most of the capital's shopkeepers.
40 Committee approves $24,000 to support an anti-
Allcnde businessmen's organization.
The Confederation of Truck Owners calls a nationwide
strike.
40 Committee approves $1,427,666 to support opposition
political parties and private sector organizations in
anticipation of March 1973 Congressional elections.
Speaking before the General Assembly of the United
Nations, President Allende charges that Chile has been
the "victim of serious aggression" and adds, "we
have felt the effects of a large-scale external pressure
against us."
1973
40 Committee approves $200,000 to support opposition
political parties in the Congressional elections.
In the Congressional elections, Allende's Popular Unity
coalition wins 43.4 percent of the vote.
Talks between the U.S. and Chile on political and finan-
cial problems end in an impasse.











June 5

June 20


June 21





June 29





July 26
August 2

August 20


August 23




August 27
September 4




September 11'


September 13

September-
October



October 15



June 24


September 16

October 25


December 80


1973-Continued
Chile suspends its foreign shipments of copper as miners'
strikes continue.
Thousands of physicians, teachers, and students go on
strike to protest Allende's handling of the 63-day
copper workers' strike.
Gunfire, bombings, and fighting erupt as government op-
ponents and supporters carry out a massive strike.
The opposition newspaper, El Mercurio, is closed by
court order for six days following a government
charge that it had incited subversion. The following
day an appeals court invalidates the closure order.
Rebel forces seize control of the downtown area of Santi-
ago and attack the Defense Ministry and the Presi-
dential Palace before troops loyal to the government
surround them and force them to surrender. This is
the first military attempt to overthrow an elected
Chilean government in 42 years.
Truck owners throughout Chile go on strike.
The owners of more than 110,000 buses and taxis go on
strike.
40 Committee approves $1 million to support opposition
political parties and private sector organizations. This
money is not spent.
General Carlos Prats Gonzalez resigns as Allende's De-
fense Minister and Army Commander. General Pino-
chet Ugarte is named Army Commander on August 24.
Prats' resignation is interpreted as a severe blow to
Allende.
Chile's shop owners call another anti-government strike.
An estimated 100,000 supporters of Allende's government
march in the streets of Santiago to celebrate the third
anniversary of his election.
The Confederation of Professional Employees begins an
indefinite work stoppage.
The Chilean military overthrows the government of Sal-
vador Allende. Allende dies during the takeover, re-
portedly by suicide.
The new military government names Army Commander
Pinochet President and dissolves Congress.
The Junta declares all Marxist political parties illegal
and places all other parties in indefinite recess. Press
censorship is established, as are detention facili-
ties for opponents of the new regime. Thousands of
casualties are reported, including summary executions.
40 Committee approves $34,000 for an anti-Allende radio
station and travel costs of pro-Junta spokesmen.

1974
40 Committee approves $50,000 for political commit-
ments made to the Christian Democratic Party be-
fore the coup.
President Ford acknowledges covert operations in
Chile.
The Inter-American Commission on Human Rights of
the O.A.S. reports "grievous violations of human
rights" in Chile.
U.S. military aid is cut off.







62

1975

June 20 Pinochet declares there "will be no elections in Chile
during my lifetime nor in the lifetime of my
successor."
July 4 Chile refuses to allow the U.N. Commission on Human
Rights to enter the country.
October 7 The U.N. Commission on Human Rights reports "with
profound disgust" the use of torture as a matter
of policy and other serious violations of human
rights in Chile.

Portions of the above chronology of events in Chile were extracted from
chronologies prepared by the Congressional Research Service ("Chile, 1960-70:
A Chronology"; "Chile Since the Election of Salvador Allende: A Chronology";
"Developments in Chile, March 1973 to the Overthrow of the Allende Govern-
ment") and from material contained in the June 21, 1973, report of the Senate
Foreign Relations Subcommittee on Multinational Corporations entitled "ITT and
Chile."
O




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