339-370/428-S/80023

FOREIGN
RELATIONS
OF THE
UNITED
STATES
19691976
VOLUME XXI
CHILE,
19691973
DEPARTMENT
OF
STATE
Washington
339-370/428-S/80023
Foreign Relations of the
United States, 19691976
Volume XXI
Chile, 19691973
Editors James McElveen
James Siekmeier
General Editor Adam Howard
United States Government Printing Office
Washington
2014
339-370/428-S/80023
DEPARTMENT OF STATE
Office of the Historian
Bureau of Public Affairs
For sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area (202) 512-1800
Fax: (202) 512-2250 Mail: Stop IDCC, Washington, DC 20402-0001
339-370/428-S/80023
Preface
The Foreign Relations of the United States series presents the official
documentary historical record of major foreign policy decisions and
significant diplomatic activity of the United States Government. The
Historian of the Department of State is charged with the responsibility
for the preparation of the Foreign Relations series. The staff of the Office
of the Historian, Bureau of Public Affairs, under the direction of the
General Editor of the Foreign Relations series, plans, researches, com-
piles, and edits the volumes in the series. Secretary of State Frank B.
Kellogg first promulgated official regulations codifying specific stand-
ards for the selection and editing of documents for the series on March
26, 1925. These regulations, with minor modifications, guided the series
through 1991.
Public Law 102138, the Foreign Relations Authorization Act, es-
tablished a newstatutory charter for the preparation of the series which
was signed by President George H.W. Bush on October 28, 1991. Sec-
tion 198 of P.L. 102138 added a new Title IV to the Department of
States Basic Authorities Act of 1956 (22 USC 4351, et seq.).
The statute requires that the Foreign Relations series be a thorough,
accurate, and reliable record of major United States foreign policy deci-
sions and significant United States diplomatic activity. The volumes of
the series should include all records needed to provide comprehensive
documentation of major foreign policy decisions and actions of the
United States Government. The statute also confirms the editing prin-
ciples established by Secretary Kellogg: the Foreign Relations series is
guided by the principles of historical objectivity and accuracy; records
should not be altered or deletions made without indicating in the pub-
lished text that a deletion has been made; the published record should
omit no facts that were of major importance in reaching a decision; and
nothing should be omitted for the purposes of concealing a defect in
policy. The statute also requires that the Foreign Relations series be pub-
lished not more than 30 years after the events recorded. The editors are
convinced that this volume meets all regulatory, statutory, and schol-
arly standards of selection and editing.
Structure and Scope of the Foreign Relations Series
This volume is part of a subseries of volumes of the Foreign Rela-
tions series that documents the most important issues in the foreign
policy of Presidents Richard M. Nixon and Gerald R. Ford. The sub-
series presents in multiple volumes a comprehensive documentary rec-
III
339-370/428-S/80023
IV Preface
ord of major foreign policy decisions and actions of both administra-
tions. This volume documents U.S. policy toward Chile from January
20, 1969 to September 24, 1973, when the Nixon administration an-
nounced its extension of diplomatic recognition to the military junta
under General Augusto Pinochet.
Although intended to stand on its own, this volume should be read
in conjunction with other volumes in the series, in particular the elec-
tronic supplement, Foreign Relations, 19691976, volume E16, Docu-
ments on Chile, 19691973. In addition to the electronic supplement,
the reader should consult Foreign Relations, 19691976, volume E10,
Documents on American Republics, 19691972 and volume E11, Doc-
uments on South America, 19731976, Part 2, for further documenta-
tion on the role Chile played in the Nixon administrations overall
policy in Latin America.
Focus of Research and Principles of Selection for Foreign Relations,
19691976, Volume XXI
The primary focus of this volume is on the attitudes adopted and
actions taken by the U.S. Government toward the installation of two
successive Chilean presidents: the election and inauguration of Sal-
vador Allende in September 1970 and the military coup detat of Gen-
eral Augusto Pinochet in September 1973. This volume differs from
most volumes in the Foreign Relations series, however, in two important
ways. First, many of the documents herein have been thoroughly ex-
amined, summarized, and declassified in several other public projects,
in particular: the reports released in the mid-1970s by the Senate Select
Committee to Study Governmental Operations with Respect to Intelli-
gence Activities (the Church Committee); and the documents released
in the late-1990s by the Chile Declassification Project (the Pinochet Proj-
ect). The editors of this volume, while acknowledging what has been
released before, have tried to meet the series standard of thorough-
ness, accuracy, and reliability not only by adding to the historical re-
cord but also by presenting a complete documentary account, regard-
less of previous declassification. Second, recognizing both the
importance of the subject and the nature of the documentation, the ed-
itors also compiled an extensive electronic supplement (Foreign Rela-
tions, 19691976, volume E16, Documents on Chile, 19691973), which,
when released, will be available online at the Office of the Historian
website. The supplement will include a selection of Presidential tape
recordings, as transcribed by the editors, which adds context and detail
to formal records on President Nixons posture toward President Al-
lende; and several documents on human rights in the aftermath of the
Pinochet coup, in particular, the disappearance and death of two U.S.
citizens, Charles Horman and Frank Teruggi. In the latter instance, al-
though Horman and Teruggi both died before September 24 (i.e. the
339-370/428-S/80023
Preface V
last day covered in this volume), the investigation into the circum-
stances surrounding these two tragic casesand the resulting public
controversycontinued long afterwards. Additional documentation,
therefore, is scheduled for publication in the subsequent compilation
on Chile in Foreign Relations, 19691976, volume E11, Documents on
South America, 1973-1976, Part 2.
Although organized into five chapters, this volume is perhaps best
surveyed in terms of three periods in Allendes political career: before
his election on September 4, 1970; between his election and inaugura-
tion on November 4, 1970; and after his inauguration until his over-
throw and death on September 11, 1973. The first period also corre-
sponds to the final two years of the administration of President
Eduardo Frei, which, in terms of U.S. policy, continued largely along
lines established during his first four years in office. Frei, for instance,
received substantial political and economic support, including covert
assistance during the 1964 election from the Kennedy and Johnson
administrations. Since the deliberations on whether to provide similar
assistance to any of the major candidates in the 1970 election were
heavily influenced by the decision-making process six years earlier, as
well as by political developments in the intervening years, readers
should consult the compilation on Chile in Foreign Relations, 19641968,
volume XXXI, South and Central America; Mexico. Allendes narrow
victory in the 1970 election represented a decisive break in this contin-
uity, a break that is clearly represented in the pace of documentation, as
the Nixon administration sought to block Allendes confirmation and
inauguration. The second period, covering these intervening two
months, is the heart of the volume, documenting day-to-day decisions
in a series of meetings, memoranda, and backchannel messages on
Track I and Track II, attempting to block Allende, either by constitu-
tional means or by military coup detat, respectively. The third period,
which picks up the story after Allendes inauguration, demonstrates
how the Nixon administration adopted and implemented its cool and
correct policy to destabilize the Chilean Government while simultane-
ously strengthening ties with the Chilean military. This policy was
largely determined less through covert operations and more through
the formal interagency process on economic affairs, including discour-
aging favorable terms in international lending and foreign assistance to
Chile, while encouraging a favorable settlement in the nationalization
of copper and other Chilean industries, previously dominated by U.S.
multinational corporations. The volume concludes with the events of
September 1973: the coup detat under General Pinochet, Allendes sui-
cide, and U.S. diplomatic recognition of the military junta.
Editorial Methodology
The documents are presented chronologically according to Wash-
ington time. Memoranda of conversation are placed according to the
339-370/428-S/80023
VI Preface
time and date of the conversation, rather than the date the memoran-
dum was drafted.
Editorial treatment of the documents published in the Foreign Rela-
tions series follows Office style guidelines, supplemented by guidance
from the General Editor and the chief technical editor. The documents
are reproduced as exactly as possible, including marginalia or other no-
tations, which are described in the footnotes. Texts are transcribed and
printed according to accepted conventions for the publication of histor-
ical documents within the limitations of modern typography. A
heading has been supplied by the editors for each document included
in the volume. Spelling, capitalization, and punctuation are retained as
found in the original text, except that obvious typographical errors are
silently corrected. Other mistakes and omissions in the documents are
corrected by bracketed insertions: a correction is set in italic type; an
addition in roman type. Words repeated in telegrams to avoid garbling
or provide emphasis are silently corrected. Words or phrases under-
lined in the source text are printed in italics. Abbreviations and contrac-
tions are preserved as found in the original text, and a list of abbrevia-
tions is included in the front matter of each volume. In telegrams, the
telegram number (including special designators such as Secto) is
printed at the start of the text of the telegram.
Bracketed insertions are also used to indicate omitted text that
deals with an unrelated subject (in roman type) or that remains classi-
fied after declassification review (in italic type). The amount and,
where possible, the nature of the material not declassified has been
noted by indicating the number of lines or pages of text that were omit-
ted. Entire documents withheld for declassification purposes have been
accounted for and are listed with headings, source notes, and number
of pages not declassified in their chronological place. All brackets that
appear in the original text are so identified in footnotes.
The first footnote to each document indicates the source of the doc-
ument, original classification, distribution, and drafting information.
This note also provides the background of important documents and
policies and indicates whether the President or his major policy ad-
visers read the document.
Editorial notes and additional annotation summarize pertinent
material not printed in the volume, indicate the location of additional
documentary sources, provide references to important related docu-
ments printed in other volumes, describe key events, and provide sum-
maries of and citations to public statements that supplement and eluci-
date the printed documents. Information derived from memoirs and
other first-hand accounts has been used when appropriate to supple-
ment or explicate the official record.
339-370/428-S/80023
Preface VII
The numbers in the index refer to document numbers rather than
to page numbers.
Advisory Committee on Historical Diplomatic Documentation
The Advisory Committee on Historical Diplomatic Documenta-
tion, established under the Foreign Relations statute, reviews records,
advises, and makes recommendations concerning the Foreign Relations
series. The Advisory Committee monitors the overall compilation and
editorial process of the series and advises on all aspects of the prepara-
tion and declassification of the series. The Advisory Committee does
not necessarily review the contents of individual volumes in the series,
but it makes recommendations on issues that come to its attention and
reviews volumes, as it deems necessary to fulfill its advisory and statu-
tory obligations.
Presidential Recordings and Materials Preservation Act Review
Under the terms of the Presidential Recordings and Materials Pres-
ervation Act (PRMPA) of 1974 (44 USC 2111 note), the National Ar-
chives and Records Administration (NARA) has custody of the Nixon
Presidential historical materials. The requirements of the PRMPA and
implementing regulations govern access to the Nixon Presidential his-
torical materials. The PRMPA and implementing public access regula-
tions require NARA to review for additional restrictions in order to en-
sure the protection of the privacy rights of former Nixon White House
officials, since these officials were not given the opportunity to separate
their personal materials from public papers. Thus, the PRMPA and im-
plementing public access regulations require NARA formally to notify
the Nixon estate and former Nixon White House staff members that the
agency is scheduling for public release Nixon White House historical
materials. The Nixon estate and former White House staff members
have 30 days to contest the release of Nixon historical materials in
which they were a participant or are mentioned. Further, the PRMPA
and implementing regulations require NARA to segregate and return
to the creator of files private and personal materials. All Foreign Rela-
tions volumes that include materials from NARAs Nixon Presidential
Materials Staff are processed and released in accordance with the
PRMPA.
Nixon White House Tapes
Access to the Nixon White House tape recordings is governed by
the terms of the PRMPA and an access agreement with the Office of
Presidential Libraries of the National Archives and Records Adminis-
tration and the Nixon Estate. In February 1971, President Nixon initi-
ated a voice activated taping system in the Oval Office of the White
House and, subsequently, in the Presidents Office in the Executive
339-370/428-S/80023
VIII Preface
Office Building, Camp David, the Cabinet Room, and White House and
Camp David telephones. The audiotapes include conversations of Pres-
ident Nixon with his Assistant for National Security Affairs, Henry
Kissinger, other White House aides, Secretary of State Rogers, other
Cabinet officers, members of Congress, and key foreign officials. The
clarity of the voices on the tape recordings is often very poor, but the
editor has made every effort to verify the accuracy of the transcripts
produced here. Readers are advised that the tape recording is the offi-
cial document; the transcript represents an interpretation of that docu-
ment. Through the use of digital audio and other advances in tech-
nology, the Office of the Historian has been able to enhance the tape
recordings and over time produce more accurate transcripts. The result
is that some transcripts printed here may differ from transcripts of the
same conversations printed in previous Foreign Relations volumes.
The most accurate transcripts possible, however, cannot substitute for
listening to the recordings. Readers are urged to consult the recordings
themselves for a full appreciation of those aspects of the conversations
that cannot be captured in a transcript, such as the speakers inflections
and emphases that may convey nuances of meaning, as well as the
larger context of the discussion.
Declassification Review
The Office of Information Programs and Services, Bureau of Ad-
ministration, conducted the declassification review for the Department
of State of the documents published in this volume. The review was
conducted in accordance with the standards set forth in Executive
Order 13526, as amended, on Classified National Security Information
and applicable laws.
The principle guiding declassification review is to release all infor-
mation, subject only to the current requirements of national security as
embodied in law and regulation. Declassification decisions entailed
concurrence of the appropriate geographic and functional bureaus in
the Department of State, other concerned agencies of the U.S. Govern-
ment, and the appropriate foreign governments regarding specific doc-
uments of those governments. The declassification review of this vol-
ume, which began in 2000 and was completed in 2013 resulted in the
decision to withhold 1 document in full, excisions of a paragraph or
more in 55 documents, and minor excisions of less than a paragraph in
112 documents.
The Office of the Historian is confident, on the basis of the research
conducted in preparing this volume and as a result of the declassifica-
tion review process described above, that the record presented in this
volume presented here provides an accurate and comprehensive ac-
count of U.S. foreign policy on Chile.
339-370/428-S/80023
Preface IX
Acknowledgments
The editors wish to acknowledge the assistance of officials at the
Nixon Presidential Materials Project of the National Archives and Rec-
ords Administration (Archives) in College Park, Maryland, and at the
Ford Presidential Library in Ann Arbor, Michigan. In addition, they are
grateful to the Richard Nixon Estate for allowing access to the Nixon
Presidential recordings and the Richard Nixon Library and Birthplace
for facilitating that access. Research in the Kissinger Papers, including
transcripts of telephone conversations, could not have occurred
without the kind permission of Henry A. Kissinger. The editors would
also like to thank Peter Kornbluh, Senior Analyst and Director of the
Chile Declassification Project at the National Security Archive, for his
expertise and encouragement.
James McElveen and James Siekmeier collected the documents,
made the selections, and annotated them under the direct supervision
of successive chiefs of the Asia and Americas Division, Edward C.
Keefer and Erin R. Mahan, and under the general direction of two suc-
cessive General Editors, David S. Patterson and Edward C. Keefer. Al-
though both contributed to the research and annotation of the entire
volume, McElveen was responsible for compiling the first three
chapters, through Allendes inauguration in November 1970; and Siek-
meier, for the last two chapters, through Allendes overthrow (and
formal diplomatic recognition of the military junta under General Pino-
chet). Susan Weetman, Carl Ashley, and Dean Weatherhead coordi-
nated the declassification review. David Geyer assumed responsibility
for resolving substantive issues of compilation and review during the
final stages of production. Kristen Ahlberg, Keri Lewis, Mandy A.
Chalou, and Rita Baker performed the copy and technical editing.
Stephen P. Randolph, Ph.D. Bureau of Public Affairs
The Historian May 2014
339-370/428-S/80023
Contents
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III
Sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII
Abbreviations and Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXI
Persons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXVII
Note on U.S. Covert Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXXVII
Chile, 6973
A Noisy Democracy: The Decline of Eduardo Frei,
JanuaryDecember 1969 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
A Spoiling Operation: The 1970 Chilean Presidential
Election, January 1September 4, 1970 . . . . . . . . . . . . . . . . . . . . . . 63
Two Tracks: U.S. Intervention in the Confirmation of the
Chilean President, September 5November 4, 1970 . . . . . . 175
Cool and Correct: The U.S. Response to the Allende
Administration, November 5, 1970December 31,
1972 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
That Chilean Guy May Have Some Problems: The
Downfall of Salvador Allende, JanuarySeptember 1973 840
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 947
XI
339-370/428-S/80023
Sources
Sources for the Foreign Relations Series
The 1991 Foreign Relations statute requires that the published rec-
ord in the Foreign Relations series include all records needed to provide
comprehensive documentation on major U.S. foreign policy decisions
and significant U.S. diplomatic activity. It further requires that govern-
ment agencies, departments, and other entities of the U.S. Government
engaged in foreign policy formulation, execution, or support cooperate
with the Department of State Historian by providing full and complete
access to records pertinent to foreign policy decisions and actions and
by providing copies of selected records. Most of the sources consulted
in the preparation of this volume have been declassified and are avail-
able for review at the National Archives and Records Administration.
The editors of the Foreign Relations series have complete access to
all the retired records and papers of the Department of State: the central
files of the Department; the special decentralized files (lot files) of the
Department at the bureau, office, and division levels; the files of the De-
partments Executive Secretariat, which contain the records of interna-
tional conferences and high-level official visits, correspondence with
foreign leaders by the President and Secretary of State, and memoranda
of conversations between the President and Secretary of State and for-
eign officials; and the files of overseas diplomatic posts. All the Depart-
ments indexed central files through July 1973 have been permanently
transferred to the National Archives and Records Administration at
College Park, Maryland (Archives II). Many of the Departments de-
centralized office files covering the 19691976 period, which the Na-
tional Archives deems worthy of permanent retention, have been trans-
ferred or are in the process of being transferred from the Departments
custody to Archives II.
The editors of the Foreign Relations series also have full access to the
papers of Presidents Nixon and Ford as well as other White House for-
eign policy records. Presidential papers maintained and preserved at
the Presidential libraries include some of the most significant foreign
affairs-related documentation from the Department of State and other
Federal agencies including the National Security Council, the Central
Intelligence Agency, the Department of Defense, and the Joint Chiefs of
Staff. Dr. Henry Kissinger has approved access to his papers at the Li-
brary of Congress. These papers are a key source for the Nixon-Ford
subseries of the Foreign Relations series.
XIII
339-370/428-S/80023
XIV Sources
Research for this volume was completed through special access to
restricted documents at the Nixon Presidential Materials Project, the
Ford Presidential Library, the Library of Congress, and other agencies.
While all the material printed in this volume has been declassified,
some of it is extracted from still classified documents. In the time since
the research for this volume was completed, the Nixon Presidential
Materials have been transferred to the Nixon Presidential Library and
Museum in Yorba Linda, California. The Nixon Presidential Library
staff is processing and declassifying many of the documents used in
this volume, but they may not be available in their entirety at the time
of publication.
Sources for Foreign Relations, 19691976, Volume XXI
In preparing this volume, the editors thoroughly mined the Presi-
dential Papers and other White House records from the Nixon Presi-
dential Materials Project at the National Archives. This research was
conducted when the project was still housed at the facility in College
Park (Archives II); both the project and the collection were subse-
quently moved in 2010 to its permanent home at the Nixon Presidential
Library in Yorba Linda. Whether in Maryland or California, these ma-
terials proved the most valuable source of documentation on the Nixon
administrations conduct of relations with Chile. Some of the most im-
portant records for this volume were found in the National Security
Council Files, in particular, the Country Files on Chile. These files doc-
ument basic day-to-day decision making within the White House and
National Security Council staff, including memoranda to Kissinger and
Nixon, records of meetings, copies of telegrams, and backchannel mes-
sages. Two folders within the National Security Files are also worth
mentioning here with similar, if more specialized, documentation: one,
entitled Korry File, is part of the Country Files on Chile; and the other,
entitled Chile Wrap and Post-Mortem, is part of the Country Files in
the Kissinger Office Files. Ambassador Korry played a central role in
U.S.-Chilean relationsparticularly during the pivotal events of Sep-
tember and October 1970 (between Allendes election and subsequent
inauguration as President)until Korrys replacement in October 1971.
His lengthy backchannel messages are not only concentrated in the
sources cited above but also scattered throughout other repositories. In
the midst of other, more bureaucratic, documents, these Korrygrams,
as they were called at the time, are as entertaining to read as they are
essential for following developments in Chile on a daily basis.
The formal policy-making process on Chile is documented in the
National Security Files (H-Files) at the Nixon Library. These files con-
tain minutes, memoranda, and related documentation on the delibera-
tions of the National Security Council itself, the Senior Review Group,
the Washington Special Actions Group, and other interagency com-
339-370/428-S/80023
Sources XV
mittees; also included are records relating to National Security Council
Study and Decision Memoranda (NSSMs and NSDMs), as well as simi-
lar decision-making documents. The H-Files are most useful in docu-
menting interagency discussions on Chile, either before Allendes elec-
tion in September 1970 or after his inauguration in November 1970;
there is little, if any, documentation in the H-Files, for instance, on
Track II (Project FUBELT) to foment a military coup against Allende in
October 1970. Rather than rely on formal decision papers, Nixon and
Kissinger made many decisions on Chile outside normal bureaucratic
channels, in particular, through a series of one-on-meetings and tele-
phone conversations. The editors, therefore, consulted two other cru-
cial sources: the Kissinger Telephone Conversation Transcripts; and the
Nixon White House Tape Recordings. The Kissinger transcripts pro-
vide a rare glimpse into the role played by the Presidents Assistant for
National Security Affairs in regard to Chile, in particular, before Al-
lendes inauguration but also at the time of his overthrow in September
1973. Installed in February 1971 and removed in July 1973, the White
House taping system was unfortunately not in operation during either
period. The Nixon tapes, nonetheless, include a number of important
deliberations on Chile, notably on Nixons policy to adopt a cool and
correct posture in relations with Allende; transcripts of these conver-
sations, as transcribed by the editors, are printed in the electronic sup-
plement, Foreign Relations, 19691976, volume E16, Documents on
Chile, 19691973.
Given the level of U.S. involvement in Chilean political affairs
during the Nixon administration, intelligence records were essential in
compiling this volume. The editors had access to the records at the Na-
tional Security Council, the Central Intelligence Agency, the Depart-
ment of State, and the Department of Defense. The Nixon Intelligence
Files at the National Security Council constitute the most authoritative
record of the meetings of the 303 Committee and its successor, the 40
Committee, which were responsible for decisions on covert operations.
The files of the Central Intelligence Agency, particularly the National
Intelligence Council Registry of NIEs and SNIEs (Job 79R01012A), were
essential for intelligence reports and assessments on which the Nixon
administration based its policy decisions. Although many of its most
important records on covert operations were also found in other repos-
itories, several collections (or Jobs) were invaluable at the Central In-
telligence Agency, including the files of Director of Central Intelligence
Helms (Job 80B01285A), 1970 Chile Task Force files (Job 80000012A),
the Executive Registry Subject Files on Chile (Job 80B01086A), and the
1973 Western Hemisphere Division files (Job 8000197A). The Bureau
of Intelligence and Research in the Department of State was also an ac-
tive participant on intelligence matters, whether in assessing develop-
ments in Chile or in developing options for U.S. policymakers. The
339-370/428-S/80023
XVI Sources
historical files of the Bureaus Office of Intelligence Coordination
(INR/IL) and the files of James Gardner, who served first as Deputy Di-
rector for Coordination and then as Chief of the Operations Policy Staff,
were particularly useful in this regard, notably the memoranda of re-
gular ARA/CIA meetings on intelligence.
U.S. involvement in Chile was the subject of several congressional
investigations in the 1970s, most notably two chaired by Senator Frank
Church (D-Idaho), the Senate Select Committee to Study Governmental
Operations with Respect to Intelligence Activities, which investigated
U.S. covert operations in Chile, and the Subcommittee on Multinational
Corporations, which investigated allegations against the involvement
of the International Telegraph and Telephone Company (ITT) in Chile;
and the House Select Committee on Intelligence, chaired by Con-
gressman Otis Pike (D-New York). Materials related to these investiga-
tions, including copies of the original documents collected, were found
in at least two archival sources. The most valuable of these was a retired
Department of State office or lot file, 81D121, held for reference pur-
poses in the Foreign Affairs Information Management Center (as it was
called at the time) until its transferal to the National Archives in 2004 as
part of Record Group 59 (RG 59). Since the investigations largely took
place during the Ford administration, the records held at the Ford Pres-
idential Library in Ann Arbor, Michigan, are also useful, in particular,
the Intelligence Subject File in the collection of Philip Buchen, who
served as Counsel to the President.
As important as covert operations in Chile may have been, how-
ever, the United States still conducted most of its Chilean policy
through normal channels of diplomacy, in particular, through the De-
partment of State. This role is well reflected in the Departments rec-
ords, including the central and retired lot files (both RG 59) accessioned
and maintained at the National Archives. A number of records in the
central files subject numeric system were useful, including those filed
under POL 7 CHILE (visits and meetings concerning Chile), POL 12
CHILE (political parties in Chile), POL 14 CHILE (elections in Chile),
POL 15 CHILE (Chilean government), POL CHILE-US (relations be-
tween Chile and the United States), and POL 1 CHILE-US (general
policy and background on relations between Chile and the United
States); INCO COPPER CHILE (copper in Chile), and INCO 152
CHILE (nationalization/expropriation in Chile). Starting in January
1973, the Department of State switched its central files to an electronic
system; the telegrams for 1973 are available on-line in the Access to Ar-
chival Databases on the National Archives website. Some additional
documentation was also found in the retired post files (RG 84) for San-
tiago, in particular, the Embassys classified Allende file for
19681973 (Lot 78F112).
339-370/428-S/80023
Sources XVII
The Kissinger Papers at the Library of Congress largely replicate
documentation found in other collections. Since this volume was com-
piled, copies of the most important original sourcethe Kissinger Tele-
phone Conversation Transcripts (see above)were initially deposited
at the Nixon Presidential Materials Project; they were then relocated to
the Nixon Presidential Library in 2010. Although the citations in this
volume refer to the Kissinger Papers, copies of the transcripts as orga-
nized in the original collection are available to the public at the Nixon
Presidential Library.
The following list identifies the particular files and collections
used in the preparation of the volume. The declassification and transfer
to the National Archives of the Department of State records is in proc-
ess, and many of these records are already available for public review
at the National Archives.
Unpublished Sources
Department of State
Central Files. See Record Group 59 under National Archives and Records Administration
below
Lot Files. See Record Group 59 under National Archives and Records Administration
below
Lot 71D18 PoliticalCountry Team Minutes
Lot 74D416, Executive Secretariat, Briefing Books, 19581976
Lot 80D212, S/S Files, NSSM 97
Lot 83D305, S/S Files, NSDM 93
Bureau of Intelligence and Research, INR/L Historical Files
Chile Chronology 1970
Chile JanuaryAugust 1970
Chile, 40 Committee Action after September 1970
Chile, JulyDecember 1972
Chile 19731975
Virtual Reading Room, Document Collections, CIA Chile Declassification Project
National Archives and Records Administration, College Park, Maryland
Record Group 59, General Records of the Department of State
Central Files
19671969, INCO COPPER CHILE
19671969 POL 15 CHILE
19671969 POL 239 CHILE
19701973, POL CHILE-US
19701973, POL 2 CHILE
19701973, POL 12 CHILE
339-370/428-S/80023
XVIII Sources
19701973, POL 14 CHILE
19701973, POL 15 CHILE
19701973, POL 151 CHILE
19701973, INCO COPPER CHILE
19701973, INCO 152 CHILE
19701973, DEF 9 US
19701973, DEF 9 CHILE
19701973, DEF 15 CHILE
19701973, E 5 LA
19701973, E 14 LAPC
Central Foreign Policy File, 19731976
Part of the online Access to Archival Databases; Electronic Telegrams, P-Reel Index,
P-Reel microfilm
Lot Files
Lot 71D227, Executive Secretariat, Conference Files, 19661972
Lot 81D121, ChileITTCIA 19631977
Documents Requested by the Department of Justice, 19701977
Chile/CIA #1
Chile/CIA #2
Chile ITT (Testimony)
Chile Papers-Church Committee-August 12, 1975
Chile-CIA 1970
Lot 94D565, INR/IL, James Gardner Chronological File
Record Group 84, Records of the Foreign Service Posts of the United States
Santiago, 19681973, Classified Allende Files
Santiago Embassy Files, 19681973, POL
Santiago Embassy Files, 19711975, Subject Files
Santiago Embassy Files, Allende Government JulyAugust 1972
Record Group 218, Records of the Chairman of the Joint Chiefs
Records of Thomas H. Moorer
Admin (AC) CMS [Chairmans Memos]
Nixon Presidential Materials Project, National Archives and Records
Administration, College Park, Maryland (now at the Nixon Presidential
Library and Museum, Yorba Linda, California)
National Security Council (NSC) Files
Backchannel Messages: Europe, Mideast, Latin America
Country Files, Latin America
Nixon Intelligence Files
Henry A. Kissinger Office Files
Country Files
303/40 Committee Files, Subject Files, Chile
339-370/428-S/80023
Sources XIX
Senior Review Group Files
Subject Files, Chile
National Security Council, Institutional Files (H-Files)
Meeting Files
Senior Review Group Meetings
Washington Special Action Group Meetings
National Security Council Meetings
Minutes Of Meetings
NSC Meeting Minutes
Senior Review Group
Policy Papers
NSDM 93
Study Memorandums
National Security Study Memorandums
Gerald R. Ford Presidential Library
Philip Buchen Collection
Intelligence Subject File
Central Intelligence Agency
Director of Central Intelligence Files
Job 80B01285A
Deputy Director for Plans Chronological File
Job 780717BA
Deputy Director for Operations Registry Files
Job 7901440A
Job 8000012A
Job 8000197A
Executive Registry Subject Files
Job 80B01086A
Job 80M01066A
National Intelligence Council
Job 79R01012A
Library of Congress
Papers of Henry A. Kissinger
Geopolitical File, 196478
Chile
Miscellany, 19681976
Record of Schedule
Telephone Records, 19691976
Telephone Conversations, Chronological File
National Security Council
Nixon Intelligence Files
339-370/428-S/80023
XX Sources
Washington National Records Center, Suitland, Maryland
OSD Files: FRC 33076067
Secret Records of the Secretary of Defense, the Deputy Secretary of Defense, and the
Special Assistant to the Secretary and Deputy Secretary of Defense
Published Sources
Davis, Nathaniel. The Last Two Years of Salvador Allende. London: I.B. Tauris, 1999.
Kissinger, Henry. The White House Years. Boston: Little, Brown, 1979.
The New York Times
United States. Congress. Senate. Alleged Assassination Plots Involving Foreign Leaders. An
Interim Report of the Select Committee to Studv Governmental Operations With Respect to
Intelligence Activities. Washington: Government Printing Office, 1975.
. Covert Action in Chile, 19631973, Staff Report of the Select Committee to Study Gov-
ernmental Operations With Respect to Intelligence Activities. Washington: Government
Printing Office, 1975.
. International Telephone and Telegraph Company and Chile, 19701971, Report to the
Committee on Foreign Relations, U.S. Senate, by the Subcommittee on Multinational Corpo-
ration. Washington: Government Printing Office, 1973.
. Department of State. Bulletin, 19691973.
. National Archives and Records Administration. Public Papers of the Presidents of
the United States: Richard Nixon, 19691973, Washington: Government Printing
Office, 19691973.
The Washington Post
339-370/428-S/80023
Abbreviations and Terms
AA/PRR, Office of Private Resources (AID)
ACQ, acquired
AD, Accion Democratica (Democatic Action Party), Venezuela
ADDO, Assistant Deputy Director for Operations, Central Intelligence Agency
ADDP, Assistant Deputy Director for Plans, Central Intelligence Agency
AEC, Atomic Energy Commission
AFLCIO, American Federation of Labor-Congress of Industrial Organizations
AFTAC, Air Force Technical Applications Command
AID, Agency for International Development
AIFLD, American Institute for Free Labor Development
AMA, American Medical Association
AP, Associated Press
APRA, Alianza Popular Revolucionario Americana (Popular Revolutionary Alliance), Peru
ARA, Bureau of Inter-American Affairs, Department of State
ARA/BC, Office of Bolivia-Chile Affairs, Bureau of Inter-American Affairs, Department
of State
ARMA, Army Attache
Backchannel, a method of communication outside normal bureaucratic procedure; the
White House, for instance, used backchannel messages to bypass the Department
of State
C130, high-wing, 4-turboprop-engine aircraft used for rapid transportation of troops
and/or equipment
CAP, Compan a Acero Pacifica (Pacific Steel Company), Chilean National Steel Company
CAS, controlled American source
CASP, Country Analysis and Strategy Plan
CCC, Commodity Credit Corporation
CS, Clandestine Services
CECLA, Comision Especial de Coordinacion Latinoamericana (Special Latin American Coor-
dinating Commission)
CEN, National Executive Committee of the Partido Radical (Radical Party)
CESEC, Centro de Estudios Socio-Economicos, polling agency
CG, Commanding General
CG, Consul General
CIA, Central Intelligence Agency
CIAP, Comite Inter-Americano de la Alianza para Progreso (Inter-American Committee of
the Alliance for Progress) to the Inter-American Economic and Social Council
CIEP, Corporacion Instituto de Educacion Popular (Institute for Popular Education); also
Council for International Economic Policy
CINC, Commander-in-Chief
CINCSO, CINCSOUTH, Commander-in-Chief, U.S. Southern Command (U.S. Navy)
CLA, Council for Latin America
CNO, Chief of Naval Operations
CODELCO, Corporacion del Cobre (Copper Corporation of Chile)
COMUSNAVSO, Commander, U.S. Navy, Southern Command
COPEC, Compan a de Petroleos de Chile (Chilean Petroleum Company)
XXI
339-370/428-S/80023
XXII Abbreviations and Terms
COPEI, Comite Organizado por Elecciones Independientes (Social Christian Party), Venezuela
CORFO, Corporacion de Fomento (National Development Bank)
COS, Chief of Station
CUT, Central Unitaria Trabajadores de Chile (Confederation of Trade Unions)
D, Deputy Under Secretary of State for Economic Affairs
DAO, Defense Attache Office
DATT, Defense Attache
DCI, Director of Central Intelligence
DCM, Deputy Chief of Mission
DDCI, Deputy Director of Central Intelligence
DDO, Deputy Director for Operations, Central Intelligence Agency
DDP, Deputy Director for Plans, Central Intelligence Agency
DefAtt, Defense Attache
DI, Departamento de Investigaciones (Department of Investigations), Chile; also Directorate
for Intelligence, Central Intelligence Agency
DIA, Defense Intelligence Agency
Dissem, Dissemination
DO, Directorate of Operations, Central Intelligence Agency
DOI, Date of Information
DOD, Department of Defense
DP, Directorate of Plans, Central Intelligence Agency
E, Bureau of Economic Affairs, Department of State
E&E, Emergency and Evacuation
Embtel, Embassy telegram
E/ORF, Office of International Resources and Food Policy, Bureau of Economic Affairs,
Department of State
ETA, estimated time of arrival
ETD, estimated time of departure
Exdis, Exclusive Distribution
EXIM, Export-Import Bank
F5, twin engine, supersonic light tactical fighter with one or two crew members
FAA, Federal Aviation Administration; Foreign Assistance Act
FACh, Fuerza Aerea de Chile (Chilean Air Force)
FBI, Federal Bureau of Investigation
FMS, Foreign Military Sales
FonMin, ForMin, Foreign Minister
FRAP, Frente de Accion Popular (Popular Action Front)
FRC, Federal Records Center
FSO, Fund for Special Operations (Inter-American Development Bank)
FY, Fiscal Year
G10, Group of Ten (Belgium, Canada, Federal Republic of Germany, France, Italy,
Japan, Netherlands, Sweden, United Kingdom, United States)
GA, General Assembly of the United Nations
GM, General Motors
GOC, Government of Chile
golpe, coup
Gosplan, State Committee for Planning of the Soviet Union
HAK, Henry A. Kissinger
HQS, Headquarters
339-370/428-S/80023
Abbreviations and Terms XXIII
IADB, Inter-American Defense Board
IBRD, International Bank for Reconstruction and Development (World Bank)
IDB, Inter-American Development Bank
IFI, International Financial Institutions
IMF, International Monetary Fund
INR, Bureau of Intelligence and Research, Department of State
INR/DDC, Deputy Director of Coordination, Bureau of Intelligence and Research, De-
partment of State
INR/IL, Office of Intelligence Liaison, Bureau of Intelligence and Research, Department
of State
IPC, International Petroleum Company
ISA, Office of International Security Affairs, Department of Defense
ITT, International Telephone and Telegraph
JCS, Joint Chiefs of Staff
K, Kissinger
LA, Latin America
LAN, Linea Aerea Nacional (National Airline of Chile)
L/ARA, Office of the Legal Adviser for Inter-American Affairs, Department of State
LATAM, Latin America
Limdis, limited distribution
MAAG, Military Assistance Advisory Group
MAP, Military Assistance Program
MAPEX, Military assistance program excess
MAPU, Movimiento de Accion Popular Unitario (United Popular Action Movement)
MFA, Ministry of Foreign Affairs
MilAid, Military Aid
MilGroup, MilGrp, Military Group
MIMEX, Major item material excess
MinAgric, Minister of Agriculture
MinDefense, Minister of Defense
MinEcon, Minister of Economy
MinInt, Minister of Interior
MinJust, Minister of Justice
MIR, Movimiento de Izquierda Revolucionaria (Revolutionary Left Movement)
MRII, Movimiento Radical Izquierda Independiente (Independent Radical Movement of the
Left)
NAC, National Advisory Council on International Monetary and Financial Policies
NARA, National Archives and Records Administration
NASA, National Aeronautics and Space Administration
NATO, North Atlantic Treaty Organization
NCO, non-commissioned officer
NIE, National Intelligence Estimate
Nodis, No Distribution
Non-com, non-commissioned officer
NSA, National Security Agency
NSC, National Security Council
NSDM, National Security Decision Memorandum
NSF, National Science Foundation
339-370/428-S/80023
XXIV Abbreviations and Terms
NSSM, National Security Study Memorandum
NYT, The New York Times
OAS, Organization of American States
OBE, overtaken by events
OMB, Office of Management and Budget
ONE, Office of National Estimates, Central Intelligence Agency
OPIC, Overseas Private Investment Corporation
para, paragraph
PCCh, Partido Comunista de Chile (Chilean Communist Party)
PDC, Partido Democrata Cristiano (Christian Democatic Party)
PDR, Partido Democrata Radical (Radical Democatic Party)
PIR, Partido Izquierda Radical (Radical Party of the Left)
PL, Public Law
P&L, Patria y Libertad (Fatherland and Liberty), Chilean right-wing political-military
organization
PN, Partido Nacional (National Party)
POL, political affairs and relations in the Department of State Central Files
PR, Partido Radical (Radical Party)
PS, Partido Socialista (Socialist Party)
PSD, Partido Socialista Democrata (Socialist Democrat Party)
RCA, Radio Corporation of America
reftel, reference telegram
RG, Record Group
RTAC, Regional Technical Assistance Center
septel, separate telegram
SFRC, Senate Foreign Relations Committee
SIDUCAM, Sindicato Independiente de Union de Carnionistas (Private Truck Owners
Confederation)
SIMEX, Secondary material excess
sitrep, Situation Report
SLC, Special Letter of Credit
SNIE, Special National Intelligence Estimate
SOUTHCOM, United States Army, Southern Command
SRG, Senior Review Group
Todep, indicator for telegrams to the Deputy Secretary of State
UN, United Nations
UNCTAD, United Nations Conference on Trade and Development
UNDP, United Nations Development Program
UNGA, United Nations General Assembly
UNITAS, annual U.S.-South American naval exercise
UP, Unidad Popular (Chilean coalition of Communists, socialists, and leftists)
USAF, United States Air Force
USCINCSO, United States Commander-in-Chief, Southern Command
USG, United States Government
USIA, United States Information Agency
USIS, United States Information Service
USN, United States Navy
USP, Union Socialista Popular (Popular Socialist Union)
339-370/428-S/80023
Abbreviations and Terms XXV
USSR, Union of Soviet Socialist Republics
VOA, Voice of America
WH, Western Hemisphere
WHD, Western Hemisphere Division, Directorate of Operations, Central Intelligence
Agency
WSAG, Washington Special Actions Group
Z, Zulu (Greenwich Mean) Time
339-370/428-S/80023
Persons
Alessandri Palma, Arturo, Chilean President from 1920 until 1924 and again from 1932
until 1938; father of Jorge Alessandri Rodriguez
Alessandri Valdez, Gustavo, Deputy, Third District in Santiago
Alessandri Rodriguez, Jorge, Chilean President from 1958 until 1964; Partido Nacional
Presidential candidate in 1970
Allende Gossens, Salvador, leader of the Unidad Popular in Chile; Chilean President
from 1970 until deposed in a coup on September 11, 1973
Almeyda Medina, Clodomiro, Chilean Foreign Minister from1970 until May 3, 1973; De-
fense Minister from May 3 to August 9, 1973; Foreign Minister from August 9 to Sep-
tember 11, 1973
Altamirano Orrego, Carlos, Chilean Secretary General of the Socialist Party until 1973
Ambrose, Miles J., Commissioner of Customs from 1971 until 1972
Arzac, Daniel N., Jr. Political Counselor, U.S. Embassy in Santiago from September 1971
Aylwin Azo car, Patricio, Chilean Senator, Partido Demo crata Cristiano (Christian Dem-
ocatic Party) until 1973; President of the Senate from January 1971 until May 1972
Baltra Cortes, Alberto, Senator, Radical Party, and later Unidad Popular, until 1973
Benedick, Richard E., Director, Office of Development Finance, International Finance
and Development, Bureau of Economic Affairs, Department of State, from 1972 until
1973
Bennett, Donald V., Lieutenant General, USA; Director of the Defense Intelligence
Agency from September 1969 until August, 1972
Bennett, Jack F., Deputy Under Secretary of the Treasury for International Monetary
Affairs
Bennett, John C., Lieutenant General, USA; Deputy Assistant to the President, White
House Chief of Staffs Office, 1973
Bergsten, C. Fred, member, National Security Council Operations Staff (International
Economic Affairs), from January 1969 until June 1971
Betancourt, Romulo, member of Accion Democritica (Democatic Action Party, Vene-
zuela); Venezuelan President from 1958 until March 11, 1964; Venezuelan politician
from 1972 until 1973
Blee, David H., Central Intelligence Agency
Boeninger, Edgardo, Rector, University of Chile, from 1970 until 1973
Bowdler, William G., U.S. Ambassador to El Salvador from November 1968 until Oc-
tober 1971; Ambassador to Guatemala from October 1971 until June 1973
Bradfield, Michael, Assistant General Counsel, Department of the Treasury until 1973
Brims, John S., Operations Center, Executive Secretariat, Office of the Secretary, Depart-
ment of State from 1971 until 1973
Broe, WilliamV., Western Hemisphere Office Director, Central Intelligence Agency until
1973
Bulnes Sanfuentes, Francisco, Senator, Chilean National Party, from 1961 until 1968
Bush, George H.W., member, U.S. House of Representatives (R-Texas) until January
1971; U.S. Ambassador to the United Nations from February 1971 until January 1973;
thereafter, Chairman, Republican National Committee
Butterfield, Alexander P., Deputy Assistant to the President from January 1969 until
1973
XXVII
339-370/428-S/80023
XXVIII Persons
Cademartori, Jose, Chilean Minster of Finance from July 5 until September 11, 1973
Caldera Rodriguez, Rafael, Venezuelan President from 1969 until 1974
Canales Marquez, Alfredo, General, Chilean Director of Military Instruction from 1970
until 1972
Carey Tagle, Guillermo, Vice President of Anaconda Copper in Chile; also, General
Viauxs connection with the Christian Democrats
Carillo Flores, Antonio, Mexican Minister of Foreign Affairs until 1970
Carmona Peralta, Juan de Dios, Chilean Minister of National Defense of the Government
until 1970
Carvajal Prado, Patricio, Admiral, Chief, Chilean National Defense Staff until 1973
Casse, Marshall L., III, Office of International Finance and Development, Bureau of Eco-
nomic and Business Affairs, Department of State, 1973
Castillo Velasco, Jaime, Vice President, Partido Demo crata Cristiano, from 1969 until
1973
Castro, Fidel, Cuban Prime Minister
Cesar Ruiz Danayu, Raul Fernando (Cesar), General, Commander-in-Chief of the Chil-
ean Air Force from 1969 until 1973
Chapin, Dwight, Special Assistant to the President from 1969 until 1971
Chapin, Frank M., member and senior CIA Officer, National Security Council Staff, from
1969 until 1971
Chapin, Frederic L., Director, Office of Bolivia-Chile Affairs, Bureau of Inter-American
Affairs, Department of State, from 1970 until 1971; Deputy Assistant Director of
Management, Department of State, 1971; member, National Security Council Staff
Cheyre Toutin, Emilio, General, Chief of Investigations of the Chilean Army from 1970
until 1971; Ambassador to Portugal from 1971 until 1973
Chonchol Chait, Jacques, Director, Instituto de Desarrollo Agropecuario (Agrarian De-
velopment Institute) until 1973
Church, Frank, Senator (D-Idaho); member, Senate Foreign Relations Committee, until
1973; Chairman, Subcommittee on Multinational Corporations, 1973; Chairman, U.S.
Senate Select Committee to Study Governmental Operations with Respect to Intelli-
gence Activities (Church Committee), 1975
Claro Salas, Fernando (Pepe), Chilean Copper Corporation
Cline, Ray S., Director, Office of Intelligence and Research, Department of State
Coerr, Wymberley deR., Director, Office of Research and Analysis for American Re-
publics, Bureau of Intelligence and Research, Department of State, from 1969 until
1971; Deputy Director for Coordination, Bureau of Intelligence and Research, from
1971 until 1972; Special Adviser, Office of Environmental Affairs, Bureau of Interna-
tional Scientific and Technological Affairs, from 1972 until 1973
Colby, William E., Executive Director-Comptroller, Central Intelligence Agency, from
January 1972 until September 1973; thereafter Director of Central Intelligence
Connally, John B., Secretary of the Treasury from February 1971 until May 16, 1972
Cooper, Charles, member, National Security Council Staff
Corrigan, Robert F., Consul General, U.S. Embassy in Rio de Janeiro from 1968 until
1972; U.S. Ambassador to Rwanda from 1972 until 1973; Deputy Assistant Secretary
of Defense, Office of International Security Affairs, from 1973
Corvalan Lepe, Luis, Secretary General of the Communist Party of Chile from 1969 until
1973
Crimmins, John H., Deputy Assistant Secretary of State for Inter-American Affairs from
April 1969 until March 1970; Acting Assistant Secretary from March to June 11, 1973;
thereafter, U.S. Ambassador to Brazil
Cushman, Robert E., Jr., Lieutenant General, USMC; Deputy Director of Central Intelli-
gence fromMay 7, 1969, until December 31, 1971; thereafter Commandant of the Ma-
rine Corps
Cyr, Krest, Vice President of Chilean Operations, Anaconda Copper, until 1973
339-370/428-S/80023
Persons XXIX
Davis, Jeanne W., Director, National Security Council Secretariat, from 1970 until 1971;
thereafter National Security Council Staff Secretary
Davis, Nathaniel, U.S. Ambassador to Chile from October 20, 1971
Del Canto, Hernan, Minister of the Secretary General of the Government of Chile, 1972;
Acting Minister of the Secretary General of the Government of Chile, 1973
Daz Casanueva, Humberto, Chilean Ambassador to the United Nations from 1970
Duhalde Vazquez, Alfredo, Chilean Vice President from September 25, 1945, until June
27, 1946; Acting President from June 27, 1946, until August 3, 1946; Vice President
from August 13, 1946, until October 17
Dungan, Ralph A., U.S. Ambassador to Chile until August 2, 1967
Duran Neumann, Julio, Senator, Partido Radical until 1969; thereafter Senator, Partido
Democrata Radical
Eagleburger, Lawrence S., Executive Assistant to the Assistant to the President for Na-
tional Security Affairs, 1969; Political Adviser, Counselor for Political Affairs, U.S.
Mission to NATO, from 1969 until 1971; Deputy Assistant Secretary of Defense from
1971 until 1973; Executive Assistant to the Secretary of State from 1973
Eaton, Samuel D., Special Assistant to the Assistant Secretary of State for Inter-American
Affairs, Department of State from July 1966 until August 1967; thereafter member,
Policy Planning and Coordination Staff, Department of State
Echeverria Alvarez, Luis, Mexican President from 1970
Edwards Eastman, Agustn, Chairman of the Board of El Mercurio publishing firm until
1973
Edwards Valdes, Jorge, Chilean Minister in Charge of Relations with Cuba, 1970; Consul
Minister to France from 1971 until 1973
Eliot, Theodore L., Jr., Executive Secretary for the Department of State from August 1969
Erlichman, John D., Counsel to the President from January to November 1969; thereafter
Assistant to the President for Domestic Affairs
Emmons, Robert, Operations Center, Executive Secretariat, Office of the Secretary, De-
partment of State, 1971
Feldman, Mark B., Assistant Legal Adviser for Inter-American Affairs, Office of the
Legal Adviser, Department of State, from 1969 until 1972; Acting Deputy Legal Ad-
viser from 1973
Figueroa Serrano, Carlos, Chilean Minister of Economy until 1970
Fisher, John W., Country Director, Office of Andean and Pacific Affairs, Bureau of
Inter-American Affairs, Department of State, from 1970 until 1973
Flanigan, Peter M., Consultant to the President on Administration and Staffing from Jan-
uary to April 1969; thereafter Assistant to the President; Executive Director of the
Council for International Economic Policy
Freeman, Mason B., Rear Admiral, USN; Vice Director and Director, Joint Staff of the
Joint Chiefs of Staff from 1970 until 1972
Frei Montalva, Arturo, member, Chilean Chamber of Deputies until 1973; younger
brother of President Eduardo Frei Montalva
Frei Montalva, Eduardo, Chilean President until 1970
Fuentealba Moena, Renan, President, Partido Democrata Cristiano
Fulbright, J. William, Senator (D-Arkansas); Chairman of the Senate Foreign Relations
Committee
Gammon, Samuel R., Executive Assistant to the Deputy Under Secretary of State for
Management, from 1971
Gantz, David A., Staff Member of the Office of the Assistant Legal Adviser for
Inter-American Affairs, Department of State, from 1970
339-370/428-S/80023
XXX Persons
Gardner, James R., Director of Operations Policy Staff and Assistant Deputy for Coordi-
nation, Bureau of Intelligence and Research, Department of State, from April 1970;
Chief, Operations Policy Staff, Department of State, from 1973
Geneen, Harold S., Chief Operating Officer and Chairman of the Board, International
Telephone and Telegraph (ITT), until 1973
Girdler, Lewis, member, Office of Research and Analysis for American Republics, Bu-
reau of Intelligence and Research, Department of State, from 1969 until 1970;
member, Office of Bolivian and Chilean Affairs, Bureau of Inter-American Affairs,
Department of State, from 1971
Gonzales, Henry B., member, U.S. House of Representatives (D-Texas) from 1969
Gonzalez, Raymond E., Political Officer, U.S. Embassy in Lima from June 1970
Guerraty Villalobos, Carlos, General, Chilean Air Force Commander-in Chief until 1970
Guevara, Ernesto (Che), Argentine revolutionary killed in Bolivia in 1967
Gumucio Vives, Rafael A., President, Partido Democrata Cristiano until 1969; President,
Movimiento de Accion Popular Unitario (United Popular Action Movement) from
1969
Guthrie, D. Keith, National Security Council Staff Secretariat from 1970 until 1972
Hackett, James T., member, National Security Council Staff, from September 1971
Haig, Alexander M., Jr., Brigadier General, USA; Military Assistant to the President for
National Security Affairs from January 1969 until June 1970; thereafter Deputy
Assistant to the President for National Security Affairs
Haldeman, H.R, Assistant to the President and White House Chief of Staff from 1969
until April 30, 1973
Haldeman, Robert, head of Kennecott Copper Corporations Chilean operations
Hales Jamarne, Alejandro, Chilean Minister of Mines until 1970
Hartman, Richard J., Brigadier General, USAF; Deputy Director, Joint Continental De-
fense Systems Integration Planning Staff, Organization of the Joint Chiefs of Staff,
from February 1970
Helms, Richard M., Director of Central Intelligence until January 23, 1973
Henderson, Douglas, member, Policy Planning Council, Department of State, from 1969
until 1970; Deputy U.S. Representative for Social and Economic Affairs, U.S. Mission
to the Organization of American States, from 1970
Hennessy, John, Deputy Assistant Secretary of the Treasury for Development Finance
from 1971
Herrera Lane, Felipe, President of the Inter-American Bank until 1971; member, United
Nations Educational, Scientific and Cultural Organization (UNESCO) Commission
for the Study of International Education, 1971; Professor of Political Economy, Uni-
versity of Chile and Catholic University, from 1971
Hewitt, Ashley C., member, National Security Council Operations Staff for Latin Amer-
ica, from 1971
Hickenlooper, Bourke B., Senator (R-Iowa)
Hobbing, Enno, Staff Director, Council for Latin America, Inc., a private organization of
U.S. businessmen in Latin America
Holdridge, John, member, National Security Council Operations Staff, East Asia, from
1970 until 1972
Hormats, Robert, member, National Security Council Operations Staff (International
Economic Affairs), from 1970 until 1972
Houdek, Robert G., Special Assistant to the President for National Security Affairs, Na-
tional Security Council Staff, from January 1969 until July 1971
Hughes, Thomas L., Director of Intelligence and Research, Department of State, until Au-
gust 1969
Huerta Celis, Vincente E., General, Commander-in-Chief of Carabineros (Chiles uni-
formed police) from 1969
339-370/428-S/80023
Persons XXXI
Hunt, Cecil M., Deputy General Counsel of the Overseas Private Investment Corpora-
tion from March 1971
Hurwitch, Robert A., Deputy Assistant Secretary of State for Inter-American Affairs
from September 1969 until August 1973
Iban ez Ojeda, Pedro, Senator, Partido Nacional, until 1973
Ingersoll, John, J., Director, Bureau of Narcotics and Dangerous Drugs, Department of
Justice, to 1972; Tropical Products Division, Office of International Commodities, Bu-
reau of Economic and Business Affairs, from 1972
Inostroza Cuevas, Alfonso, head, Central Bank of Chile, from 1970 until 1973
Irwin, John N., II, Under Secretary of State from September 1970 until July 1972; there-
after Deputy Secretary of State
Jarpa Reyes, Sergio O., President, Partido Nacional from 1968; Senator from 1973
Jessup, Peter, Executive Secretary of the 303 Committee and its successor, the 40 Com-
mittee, until 1972
Johnson, U. Alexis, Under Secretary of State for Political Affairs fromFebruary 1969 until
February 2, 1973
Jorden, WilliamJ., Deputy Special Assistant to the Under Secretary of State from January
1969 until March 1969; detailed to the National Archives, March, 1969; detailed to the
General Services Administration, June 1970; Deputy Senior Staff Member, National
Security Council Operations Staff, Latin America, from May 1972
Karamessines, Thomas H., Deputy Director for Plans, Central Intelligence Agency, until
1973
Kearns, Henry, President, Export-Import Bank, until 1973
Kendall, Donald M., President of Pepsi Cola Company
Kendall, Maurice W., Brigadier General, USA; Director, Interamerican Region, Office of
International Security Affairs, Department of Defense, from 1971 until 1973; Chief,
U.S. Delegation, Joint Brazilian-U.S. Command, from 1973
Kennedy, Richard T., Colonel, USA; member, National Security Council Staff, from 1969
until 1970; Director of the Planning Group, National Security Council Staff, until
1973
Kirilenko, Andrei P., member, Soviet Politburo and Secretary of the Communist Party of
the Soviet Union until 1973
Kissinger, Henry A., Assistant to the President for National Security Affairs from Jan-
uary 1969; also Secretary of State from September 22, 1973
Knowles, Richard T., Lieutenant General, USA; Assistant to the Chairman of the Joint
Chiefs of Staff
Korry, Edward M., U.S. Ambassador to Chile until October 20, 1971; President, Associa-
tion of American Publishers until 1973
Kubisch, John B., Deputy Chief of Mission, U.S. Embassy in Mexico City from May 1969
until December 1971; Deputy Chief of Mission, U.S. Embassy in Paris from De-
cember 1971 until June 1973; Assistant Secretary of State for Inter-American Affairs
and U.S. Coordinator, Alliance for Progress, from June 11, 1973
Lagos Matus, Gustavo, Chilean Minister of Justice until 1970
Laird, Melvin, R., Secretary of Defense from January 22, 1969
Lanusse, Alejandro Agustin, General, Commander-in-Chief of the Argentine Army until
1971; Argentine President from March 1971 until March 1973
Latimer, Thomas, Office of the Assistant to the President, National Security Council
Staff, from 1971 until 1972
339-370/428-S/80023
XXXII Persons
Leddy, Raymond G., Acting Deputy Assistant Secretary of Defense for Inter-American
Affairs from 1969 until 1971; Deputy Assistant Secretary of Defense for Inter-Ameri-
can Affairs, Foreign Trade, Disclosure and Military Rights Affairs from 1971
Leigh Guzman, Gustavo, General, Commander of the Chilean Air Force from August 20,
1973; member of ruling Military Junta from September 11, 1973
Leighton Guzman, Bernardo, Chilean Deputy from Santiago
Letelier del Solar, Orlando, Chilean Ambassador to the United States from 1970 until
May 5, 1973; Chilean Foreign Minister from May 5 until August 9, 1973; Minister of
Interior from August 9 until August 27, 1973; Minister of Defense from August 27
until September 11, 1973
Levingston, Roberto M., General; Argentine President from 1970 until 1971
Lincoln, George A., Director of the Office of Emergency Preparedness from 1969
Linowitz, Sol, U.S. Representative to the Organization of American States until 1969
Lleras Restrepo, Carlos A., Colombian President until 1970
Lord, Winston, member, National Security Council Planning Staff and Group, from Jan-
uary 1969 until 1970; also member, National Security Council Operations Staff
(United Nations Affairs), from September 1969 until 1970; thereafter, Staff member
of the Office of the Assistant to the President for National Security Affairs
Lynn, Laurence, Assistant for Programs, National Security Council Staff, from 1969 until
1970; Director, Program Analysis Staff, from 1970 until 1971
Maira, Luis, Deputy, Partido Democrata Cristiano; member, Chilean delegation to bilat-
eral talks with the United States from December 1972 until September 1973
Marambio, Tulio, General; Chilean Minister of Defense
Mark, David E., Deputy Director for Regional Research, Bureau of Intelligence and Re-
search, Department of State from 1969
Martin, Graham A., Ambassador to Italy from October 30, 1969, until February 10, 1973;
Ambassador to South Vietnam from June 21, 1973
Massad Abud, Carlos, Vice President of the Chilean Central Bank until 1970
McAfee, William, Assistant Deputy Director for Coordination, Bureau of Intelligence
and Research, Department of State, from 1969 until January 1, 1972; Deputy Director
from January 1, 1972
McCone, John, Director of Central Intelligence from1961 until 1965; Chair, Hendry Inter-
national Company, from 1968; member, Board of Directors of International Tele-
phone and Telegraph (ITT), from 1969
McGee, Gale W., Senator (R-Wyoming); Chairman, Latin American Subcommittee of the
Senate Foreign Relations Committee, from 1973
McGinnis, John J., Special Assistant for National Security Affairs to the Secretary of the
Treasury from 1972
McNamara, Robert, President, Export-Import Bank (World Bank)
Merino Castro, Jose T., Admiral, Chilean Director of Naval Services, 1969; Naval Squad-
ron Commander from 1970; Intendant at Valparaiso Naval Base from 1972; member
of ruling Military Junta from September 11, 1973
Meyer, Charles A., Assistant Secretary of State for Inter-American Affairs and U.S. Coor-
dinator, Alliance for Progress, from April 1969 until March 5, 1973; head, Inter
Agency Ad Hoc Working Group on Chile
Meyer, Cord, Jr., Assistant Deputy Director for Plans, Central Intelligence Agency, from
1969
Michaelson, Charles D., President, Metals Mining Division, Kennecott Copper Corpora-
tion, from 1969
Miller, Robert H., Deputy Executive Secretary of the Department of State from 1971
Milliken, Frank R., President, Kennecott Copper Corporation, from 1961
Mills, Bradford, President, Overseas Private Investment Corporation, from 1971
Miranda Ramirez, Hugo, Senator, Partido Radical, from 1969; President, Partido Radical
339-370/428-S/80023
Persons XXXIII
Mitchell, John N., Attorney General from January 1969 until February 1972
Montero, Raul, Admiral, Commander-in-Chief of the Chilean Navy until August 9, 1973;
Minister of Finance from August 9 until September 11, 1973
Moorer, Thomas H., Admiral, USN; Chief of Naval Operations until July 1970; thereafter
Chairman of the Joint Chiefs of Staff
Moreno, Rafael, Partido Democrata Cristiano candidate who defeated Socialist labor
leader Hector Olivares in the 5th Senatorial District, January 1973 Congressional
elections
Nachmanoff, Arnold, member, National Security Council Operations Staff, Latin Amer-
ica, from February 1969 until November 1970; Senior Staff Member for Latin Ameri-
can Affairs from November 1970
Neruda, Pablo, Nobel Prize winning poet and Chilean Ambassador to France from 1970
Nguyen Van Thieu, President of the Republic of (South) Vietnam
Nixon, Richard M., President of the United States from January 1969
Nolff, Max, Vice President, Chilean Government Copper Corporation, from 1970
Nutter, G. Warren, Assistant Secretary of Defense for International Security Affairs from
March 4, 1969, until 1973
Ortiz Mena, Antonio, President, Inter-American Development Bank, from 1971
Ossa Pretot, Sergio, Chilean Minister of Defense until 1970
Ovando Canda, Alfredo, General, Bolivian President from 1969 until 1970
Pablo, Tomas, President, Chilean Senate
Packard, David, Deputy Secretary of Defense from January 24, 1969, until December 13,
1971; thereafter Chief Executive Officer, and Chairman of the Board, Hewlett-
Packard Company
Parkinson, Jay, Chairman of the Board and Chief Financial Officer, Anaconda Copper,
from 1969
Pedersen, Richard F., Counselor of the Department of State from January 1969 until July
1973
Perez Zujovic, Edmundo, Chilean Minister of Interior until 1970; assassinated June 8,
1971, by the Vanguardia Organizada Popular (VOP)
Peterson, Peter G., Assistant to the President for International Economic Affairs and Ex-
ecutive Director of the Council for International Economic Policy from 1971 until
January 1972; Secretary of Commerce from January 1972 until January 1973
Petty, John R., Assistant Secretary of the Treasury for International Affairs until February
1972
Phillips, David A., head of the task force on Chilean operations during Track II from
1970; Chief, Western Hemisphere Division, Directorate of Operations, Department
of State, from June 1973
Philpott, Jamie M., Lieutenant General, USAF; Deputy Director of the Defense Intelli-
gence Agency from 1969
Pickering, Thomas R., Deputy Director of the Bureau of Politico-Military Affairs, De-
partment of State, from September 1969
Pinochet Ugarte, Augusto, General, Chilean Army; Chairman of the Chilean Military
Junta from September 11, 1973; Chilean President from 1974
Place, John, Chief Executive Officer, President, and Director, Anaconda Copper, from
1969
Plaza Lasso, Galo, Secretary General of the Organization of American States until 1973
Porta Angulo, Fernando, Rear Admiral, Commander-in-Chief, Chilean Navy, from 1968
Porter, William, Under Secretary of State for Political Affairs from February 2, 1973
339-370/428-S/80023
XXXIV Persons
Prats Gonzales, Carlos, General, Commander-in-Chief of the Chilean Land Forces until
August 23, 1973; also Minister of the Interior from November 2, 1972, through Au-
gust 9, 1973, and Minister of Defense from August 9 through August 23, 1973
Prebisch, Raul, Argentine economist; head of the United Nations Economic Commission
on Latin America from 1969
Quigley, William E., Jr., Vice Chairman of the Board, Anaconda Copper, from 1969
Ratliff, Rob Roy, member, National Security Council Staff, and Executive Secretary of
the 40 Committee from 1972
Richardson, Elliot L., Under Secretary of State from January 1969 until June 1970; Secre-
tary of Health, Education, and Welfare from June 1970 until January 1973; Secretary
of Defense from January until May 1973; Attorney General from May until October
1973
Richardson, John, Jr., Assistant Secretary of State for Educational and Cultural Affairs
from July 1969; also Acting Secretary of State for Public Affairs from September 1971
Ros Valdivia, Alejandro, Chilean Interior Minister, 1972
Rockefeller, Nelson A., Governor of New York
Rodriguez Grez, Pablo, leader of Patria y Libertad until 1973
Rogers, William P., Secretary of State from January 22, 1969, until September 22, 1973
Rosenstein-Rodan, Paul, British professor in Chile from1970; confidant of Chilean Presi-
dent Frei
Ruz, Cesar, General, Commander of the Chilean Air Force until August 9, 1973; Minister
of Public Works and Transit from August 9 until September 13, 1973
Rush, Kenneth, U.S. Ambassador to the Federal Republic of Germany from July 1969
until February 1972; Deputy Secretary of Defense from February 1972 until February
1973; Deputy Secretary of State from February 1973 until September 1973
Samuels, Nathaniel, Deputy Under Secretary of State for Economic Affairs from April
1969 until May 1972
Santa Maria Santa Cruz, Domingo, Chilean Ambassador to the United States until 1970
Saunders, Harold H., member, National Security Council Operations Staff (Near East
and South Asia), from January 1969 until 1971
Schneider, Rene, General, Commander-in-Chief of the Chilean Army; assassinated by
Chilean officers on October 22, 1970
Scowcroft, Brent, General, USA; Deputy Assistant to the President for National Security
Affairs from 1973 until 1974
Selden, Armistead I., Jr., Deputy Secretary of Defense for International Security Affairs
from 1970 until 1972; Consultant, Department of Defense, from 1973
Sepu lveda Acun a, Adonis, Secretary General of the Socialist Party of Chile
Sepu lveda Galindo, Jose Maria, Chilean Director-General of Carabinero Corps until Au-
gust 9, 1973; Minister of Lands and Settlement from August 9 until September 11,
1973
Shackley, Theodore G., Central Intelligence Agency Station Chief, U.S. Embassy in
South Vietnam until February 1972; Chief, Western Hemisphere Division, Direc-
torate of Operations, Central Intelligence Agency, from April 1972 until November
1973
Shakespeare, Frank, Jr., Director of the United States Information Agency from February
1969
Shlaudeman, Harry W., Deputy Chief of Mission in U.S. Embassy in Santiago from June
1969 until August 1973; Deputy Assistant Secretary of State for Inter-American Af-
fairs from June 11, 1973
Shultz, George P., Director, Office of Management and Budget, fromJune 1970 until May
1972
339-370/428-S/80023
Persons XXXV
Silva Espejo, Rene, director, El Mercurio, until 1973
Silva, Patricio, Chilean Under Secretary of Foreign Affairs
Simon, William, Deputy Secretary of the Treasury from December 1972
Szulc, Tad, U.S. journalist, New York Times
Teitelboim, Volodia, Senator, Chilean Communist Party, until 1973
Toha Gonzales, Jose, Chilean Minister of Interior from 1970 until 1972; Minister of De-
fense from 1972 until 1973
Tomic Romero, Radomiro, Presidential candidate of Partido Democrata Cristiano (PDC)
in the 1970 election; leader of PDC from September 1970
Troncoso Castillo, Rau l, Chilean Minister of State at the Moneda until 1970
Urrutia Soto, Javier, President, Chilean Development Corporation; economic adviser to
Allende until 1973
Urbina Herrera, Orlando, General, Commander of the Chilean Second Army until 1972;
Inspector General of the Army from 1973
Urzua Merino, Luis, Commander of the Chilean Marine Corps
Vaky, Viron P. (Pete), Acting Assistant Secretary of State for Inter-American Affairs from
January until May 1969; member, National Security Council Operations Staff (Latin
America) from May 1969 until September 1972; thereafter U.S. Ambassador to Costa
Rica
Valdes Phillips, Pablo, Minister Counselor of the Chilean Embassy in the United States
from 1970 until 1973
Valdes Subercaseaux, Gabriel, Chilean Foreign Minister until 1970
Valenzuela Godoy, Camilo, General, Santiago Garrison Commander, 1970
Velasco Alvarado, Juan, General; Peruvian President
Viaux Marambio, Roberto, General, Commandant of the Chilean First Army Division
from January 1969 until June 1972
Vilarin, Leo n, President of the Truck Owners Federation of Chile until 1973
Volcker, Paul A., Under Secretary of the Treasury for Monetary Affairs from January
1969
Vuskovic Bravo, Pedro, Chilean Minister of Economy from November 4, 1970, until June
12, 1972; Director of the Executive Economic Committee and Vice President of the
State Development Corporation, from June 12, 1972, until September 11, 1973
Walsh, John P., Acting Executive Secretary of the Department of State from September
until February 1969; Acting Special Assistant to the Secretary of State from February
1969 until October 1969
Walters, Vernon A., Lieutenant General, USA; Defense Attache, U.S. Embassy in Paris
from 1969 until May 1972; Deputy Director of Central Intelligence from May 1972
Weinel, John P., Vice Admiral, USN; member of strategic planning staff of the Depart-
ment of Defense from 1969
Weintraub, Sidney, Deputy Assistant Secretary for International Monetary Affairs, Bu-
reau of Economic Affairs, Department of State, from October 1969 until May 1970;
Deputy Assistant Secretary for International Finance and Development, Bureau of
Economic Affairs, from May 1970
Welander, Robert O., Rear Admiral, USN; Director, Military Liaison Office, National Se-
curity Council Staff, from July 1970
Westmoreland, William, General, USA; Army Chief of Staff until June 1972
Wimert, Paul, Jr., Lieutenant Colonel, USA; Army Attache at the U.S. Embassy in San-
tiago until June 1971
339-370/428-S/80023
XXXVI Persons
Zaldivar Larrian, Andres, Chilean Minister of Finance until November 4, 1970; Partido
Democrata Cristiano candidate in Senatorial race, April 1971
Ziegler, Ronald, White House Press Secretary from January 1969
Zorrillas Rojas, Americo, Chilean Minister of Finance from November 4, 1970, until June
12, 1972
Zumwalt, Elmo R., Jr., Admiral, USN; Chief of Naval Operations from July 1970 until
June 1974
339-370/428-S/80023
Note on U.S. Covert Actions
In compliance with the Foreign Relations of the United States statute
that requires inclusion in the Foreign Relations series of comprehensive
documentation on major foreign policy decisions and actions, the ed-
itors have identified key documents regarding major covert actions and
intelligence activities. The following note will provide readers with
some organizational context on how covert actions and special intelli-
gence operations in support of U.S. foreign policy were planned and
approved within the U.S. Government. It describes, on the basis of
declassified documents, the changing and developing procedures
during the Truman, Eisenhower, Kennedy, Johnson, Nixon, and Ford
Presidencies.
Management of Covert Actions in the Truman Presidency
The Truman administrations concern over Soviet psychological
warfare prompted the new National Security Council to authorize, in
NSC 4A of December 1947, the launching of peacetime covert action
operations. NSC 4A made the Director of Central Intelligence respon-
sible for psychological warfare, establishing at the same time the prin-
ciple that covert action was an exclusively Executive Branch function.
The Central Intelligence Agency (CIA) certainly was a natural choice
but it was assigned this function at least in part because the Agency
controlled unvouchered funds, by which operations could be funded
with minimal risk of exposure in Washington.
1
The CIAs early use of its new covert action mandate dissatisfied
officials at the Departments of State and Defense. The Department of
State, believing this role too important to be left to the CIA alone and
concerned that the military might create a new rival covert action office
in the Pentagon, pressed to reopen the issue of where responsibility for
covert action activities should reside. Consequently, on June 18, 1948, a
new NSC directive, NSC 10/2, superseded NSC 4A.
NSC 10/2 directed the CIA to conduct covert rather than merely
psychological operations, defining them as all activities which are
conducted or sponsored by this Government against hostile foreign
states or groups or in support of friendly foreign states or groups but
which are so planned and executed that any US Government responsi-
bility for them is not evident to unauthorized persons and that if un-
1
NSC 4A, December 17, 1947, is printed in Foreign Relations, 19451950, Emer-
gence of the Intelligence Establishment, Document 257.
XXXVII
339-370/428-S/80023
XXXVIII Note on U.S. Covert Actions
covered the US Government can plausibly disclaim any responsibility
for them.
The type of clandestine activities enumerated under the new direc-
tive included: propaganda; economic warfare; preventive direct ac-
tion, including sabotage, demolition and evacuation measures; subver-
sion against hostile states, including assistance to underground
resistance movements, guerrillas and refugee liberations [sic] groups,
and support of indigenous anti-Communist elements in threatened
countries of the free world. Such operations should not include armed
conflict by recognized military forces, espionage, counter-espionage,
and cover and deception for military operations.
2
The Office of Policy Coordination (OPC), newly established in the
CIA on September 1, 1948, in accordance with NSC 10/2, assumed
responsibility for organizing and managing covert actions. The OPC,
which was to take its guidance from the Department of State in peace-
time and from the military in wartime, initially had direct access to the
State Department and to the military without having to proceed
through the CIAs administrative hierarchy, provided the Director of
Central Intelligence (DCI) was informed of all important projects and
decisions.
3
In 1950 this arrangement was modified to ensure that policy
guidance came to the OPC through the DCI.
During the Korean conflict the OPC grew quickly. Wartime com-
mitments and other missions soon made covert action the most expen-
sive and bureaucratically prominent of the CIAs activities. Concerned
about this situation, DCI Walter Bedell Smith in early 1951 asked the
NSC for enhanced policy guidance and a ruling on the proper scope
and magnitude of CIA operations. The White House responded with
two initiatives. In April 1951 President Truman created the Psycholog-
ical Strategy Board (PSB) under the NSC to coordinate government-wide
psychological warfare strategy. NSC10/5, issued in October 1951, reaf-
firmed the covert action mandate given in NSC 10/2 and expanded the
CIAs authority over guerrilla warfare.
4
The PSB was soon abolished by
the incoming Eisenhower administration, but the expansion of the
CIAs covert action writ in NSC 10/5 helped ensure that covert action
would remain a major function of the Agency.
As the Truman administration ended, the CIA was near the peak
of its independence and authority in the field of covert action. Al-
though the CIA continued to seek and receive advice on specific proj-
ects fromthe NSC, the PSB, and the departmental representatives origi-
2
NSC 10/2, June 18, 1948, is printed ibid., Document 292.
3
Memorandum of conversation by Frank G. Wisner, Implementation of
NSC10/2, August 12, 1948, is printed ibid., Document 298.
4
NSC 10/5, Scope and Pace of Covert Operations, October 23, 1951, is printed in
Foreign Relations, 19501955, The Intelligence Community, Document 90.
339-370/428-S/80023
Note on U.S. Covert Actions XXXIX
nally delegated to advise the OPC, no group or officer outside of the
DCI and the President himself had authority to order, approve,
manage, or curtail operations.
NSC 5412 Special Group; 5412/2 Special Group; 303 Committee
The Eisenhower administration began narrowing the CIAs lati-
tude in 1954. In accordance with a series of National Security Council
directives, the responsibility of the Director of Central Intelligence for
the conduct of covert operations was further clarified. President Eisen-
hower approved NSC 5412 on March 15, 1954, reaffirming the Central
Intelligence Agencys responsibility for conducting covert actions ab-
road. A definition of covert actions was set forth; the DCI was made re-
sponsible for coordinating with designated representatives of the Sec-
retary of State and the Secretary of Defense to ensure that covert
operations were planned and conducted in a manner consistent with
U.S. foreign and military policies; and the Operations Coordinating
Board was designated the normal channel for coordinating support for
covert operations among State, Defense, and the CIA. Representatives
of the Secretary of State, the Secretary of Defense, and the President
were to be advised in advance of major covert action programs initi-
ated by the CIA under this policy and were to give policy approval for
such programs and secure coordination of support among the Depart-
ments of State and Defense and the CIA.
5
A year later, on March 12, 1955, NSC 5412/1 was issued, identical
to NSC 5412 except for designating the Planning Coordination Group
as the body responsible for coordinating covert operations. NSC
5412/2 of December 28, 1955, assigned to representatives (of the rank of
assistant secretary) of the Secretary of State, the Secretary of Defense,
and the President responsibility for coordinating covert actions. By the
end of the Eisenhower administration, this group, which became
known as the NSC 5412/2 Special Group or simply Special Group,
emerged as the executive body to review and approve covert action
programs initiated by the CIA.
6
The membership of the Special Group
varied depending upon the situation faced. Meetings were infrequent
until 1959 when weekly meetings began to be held. Neither the CIAnor
the Special Group adopted fixed criteria for bringing projects before the
group; initiative remained with the CIA, as members representing
5
William M. Leary, editor, The Central Intelligence Agency: History and Documents
(The University of Alabama Press, 1984), p. 63; for text of NSC 5412, see Foreign Relations,
19501955, The Intelligence Community, Document 171.
6
Leary, The Central Intelligence Agency: History and Documents, pp. 63, 147148; Final
Report of the Select Committee To Study Governmental Operations With Respect to Intelligence
Activities, United States Senate, Book I, Foreign and Military Intelligence (1976), pp. 5051.
For texts of NSC 5412/1 and NSC 5412/2, see Foreign Relations, 19501955, The Intelli-
gence Community, Documents 212 and 250.
339-370/428-S/80023
XL Note on U.S. Covert Actions
other agencies frequently were unable to judge the feasibility of partic-
ular projects.
7
After the Bay of Pigs failure in April 1961, General Maxwell Taylor
reviewed U.S. paramilitary capabilities at President Kennedys request
and submitted a report in June that recommended strengthening
high-level direction of covert operations. As a result of the Taylor Re-
port, the Special Group, chaired by the Presidents Special Assistant for
National Security Affairs McGeorge Bundy, and including Deputy
Under Secretary of State U. Alexis Johnson, Deputy Secretary of De-
fense Roswell Gilpatric, Director of Central Intelligence Allen Dulles,
and Chairman of the Joint Chiefs of Staff General Lyman Lemnitzer, as-
sumed greater responsibility for planning and reviewing covert opera-
tions. Until 1963 the DCI determined whether a CIA-originated project
was submitted to the Special Group. In 1963 the Special Group devel-
oped general but informal criteria, including risk, possibility of success,
potential for exposure, political sensitivity, and cost (a threshold of
$25,000 was adopted by the CIA), for determining whether covert ac-
tion projects were submitted to the Special Group.
8
From November 1961 to October 1962 a Special Group (Aug-
mented), whose membership was the same as the Special Group plus
Attorney General Robert Kennedy and General Taylor (as Chairman),
exercised responsibility for Operation Mongoose, a major covert action
program aimed at overthrowing the Castro regime in Cuba. When
President Kennedy authorized the program in November, he desig-
nated Brigadier General Edward G. Lansdale, Assistant for Special Op-
erations to the Secretary of Defense, to act as chief of operations, and
Lansdale coordinated the Mongoose activities among the CIA and the
Departments of State and Defense. The CIA units in Washington and
Miami had primary responsibility for implementing Mongoose opera-
tions, which included military, sabotage, and political propaganda
programs.
9
President Kennedy also established a Special Group (Counter-
Insurgency) on January 18, 1962, when he signed NSAM No. 124. The Spe-
cial Group (CI), set up to coordinate counter-insurgency activities separate
fromthe mechanism for implementing NSC 5412/2, was to confine itself to
establishing broad policies aimed at preventing and resisting subversive
insurgency and other forms of indirect aggression in friendly countries. In
early 1966, in NSAMNo. 341, President Johnson assigned responsibility for
the direction and coordination of counter-insurgency activities overseas to
7
Leary, The Central Intelligence Agency: History and Documents, p. 63.
8
Ibid., p. 82.
9
See Foreign Relations, 19611963, volume X, Cuba, 19611962, Documents 270 and
278.
339-370/428-S/80023
Note on U.S. Covert Actions XLI
the Secretary of State, who established a Senior Interdepartmental Group
to assist in discharging these responsibilities.
10
NSAM No. 303, June 2, 1964, from Bundy to the Secretaries of State
and Defense and the DCI, changed the name of Special Group 5412 to
303 Committee but did not alter its composition, functions, or
responsibility. Bundy was the chairman of the 303 Committee.
11
The Special Group and the 303 Committee approved 163 covert ac-
tions during the Kennedy administration and 142 during the Johnson
administration through February 1967. The 1976 Final Report of the
Church Committee, however, estimated that of the several thousand
projects undertaken by the CIA since 1961, only 14 percent were con-
sidered on a case-by-case basis by the 303 Committee and its prede-
cessors (and successors). Those not reviewed by the 303 Committee
were low-risk and low-cost operations. The Final Report also cited a
February 1967 CIA memorandum that included a description of the
mode of policy arbitration of decisions on covert actions within the 303
Committee system. The CIA presentations were questioned, amended,
and even on occasion denied, despite protests from the DCI. Depart-
ment of State objections modified or nullified proposed operations, and
the 303 Committee sometimes decided that some agency other than the
CIA should undertake an operation or that CIA actions requested by
Ambassadors on the scene should be rejected.
12
The effectiveness of covert action has always been difficult for any
administration to gauge, given concerns about security and the diffi-
culty of judging the impact of U.S. initiatives on events. In October 1969
the new Nixon administration required annual 303 Committee reviews
for all covert actions that the Committee had approved and automatic
termination of any operation not reviewed after 12 months. On Febru-
ary 17, 1970, President Nixon signed National Security Decision Memo-
randum 40,
13
which superseded NSC 5412/2 and changed the name of
the covert action approval group to the 40 Committee, in part because
the 303 Committee had been named in the media. The Attorney Gen-
eral was also added to the membership of the Committee. NSDM 40
reaffirmed the DCIs responsibility for the coordination, control, and
conduct of covert operations and directed him to obtain policy ap-
proval from the 40 Committee for all major and politically sensitive
10
For text of NSAM No. 124, see ibid., volume VIII, National Security Policy, Docu-
ment 68. NSAM No. 341, March 2, 1966, is printed ibid., 19641968, volume XXXIII, Or-
ganization and Management of U.S. Foreign Policy; United Nations, Document 56.
11
For text of NSAM No. 303, see ibid., Document 204.
12
Final Report of the Select Committee To Study Governmental Operations With Respect
to Intelligence Activities, United States Senate, Book I, Foreign and Military Intelligence, pp.
5657.
13
For text of NSDM 40, see Foreign Relations, 19691976, volume II, Organization
and Management of U.S. Foreign Policy, 19691972, Document 203.
339-370/428-S/80023
XLII Note on U.S. Covert Actions
covert operations. He was also made responsible for ensuring an an-
nual review by the 40 Committee of all approved covert operations.
The 40 Committee met regularly early in the Nixon administration,
but over time the number of formal meetings declined and business
came to be conducted via couriers and telephone votes. The Committee
actually met only for major new proposals. As required, the DCI sub-
mitted annual status reports to the 40 Committee for each approved op-
eration. According to the 1976 Church Committee Final Report, the 40
Committee considered only about 25 percent of the CIAs individual
covert action projects, concentrating on major projects that provided
broad policy guidelines for all covert actions. Congress received
briefings on only a few proposed projects. Not all major operations,
moreover, were brought before the 40 Committee: President Nixon in
1970 instructed the DCI to promote a coup d etat against Chilean Presi-
dent Salvador Allende without Committee coordination or approval.
14
Presidential Findings Since 1974 and the Operations Advisory Group
The Hughes-Ryan amendment to the Foreign Assistance Act of
1974 brought about a major change in the way the U.S. Government ap-
proved covert actions, requiring explicit approval by the President for
each action and expanding Congressional oversight and control of the
CIA. The CIA was authorized to spend appropriated funds on covert
actions only after the President had signed a finding and informed
Congress that the proposed operation was important to national
security.
15
Executive Order 11905, issued by President Ford on February 18,
1976, in the wake of major Congressional investigations of CIA activ-
ities by the Church and Pike Committees, replaced the 40 Committee
with the Operations Advisory Group, composed of the Presidents
Assistant for National Security Affairs, the Secretaries of State and De-
fense, the Chairman of the Joint Chiefs of Staff, and the DCI, who re-
tained responsibility for the planning and implementation of covert op-
erations. The OAG was required to hold formal meetings to develop
recommendations for the President regarding a covert action and to
conduct periodic reviews of previously-approved operations. EO 11905
also banned all U.S. Government employees frominvolvement in polit-
ical assassinations, a prohibition that was retained in succeeding ex-
ecutive orders, and prohibited involvement in domestic intelligence
activities.
16
14
Final Report of the Select Committee To Study Governmental Operations With Respect
to Intelligence Activities, United States Senate, Book I, Foreign and Military Intelligence,
pp. 5455, 57.
15
Public Law 93559.
16
Executive Order 11905, United States Foreign Intelligence Activities, Weekly
Compilation of Presidential Documents, Vol. 12, No. 8, February 23, 1976.
378-376/428-S/80023
Chile, 19691973
A Noisy Democracy: The Decline of
Eduardo Frei, JanuaryDecember 1969
1. National Intelligence Estimate
1
NIE 9469 Washington, January 28, 1969.
[Omitted here are the Table of Contents and a map of Chile.]
CHILE
The Problem
To examine the likely political and economic developments in
Chile over the next year or so, with particular reference to the congres-
sional election of March 1969, and to the general outlook for the presi-
dential election in September 1970.
Conclusions
2
A. Over the past four years the administration of Eduardo Frei has
been endeavoring to carry out a social, economic, and political revolu-
tion by peaceful, constitutional means. He has made considerable
progress in some important fields, but in others has fallen far short
of his goals. An important faction of his Christian Democratic Party
(PDC) is insisting that the scope of reform be widened and its tempo
quickened.
B. Economic prospects for the short run are bleak, and we see little
chance for much further progress on basic problems over the next year
1
Source: Central Intelligence Agency, National Intelligence Council, Job
79R01012A, NIE 9469. Secret; Controlled Dissem. According to the covering sheet, the
CIA and the intelligence organizations of the Departments of State and Defense, and the
National Security Agency participated in the preparation of the estimate. All members of
the U.S. Intelligence Board concurred in the estimate except the Atomic Energy Commis-
sion and the FBI, on the grounds that the subject was outside their jurisdiction. For the
full text of the NIE, see Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973, Document 1.
2
See footnote of dissent on page 3 following these Conclusions. [Footnote is in the
original. See footnote 3 below.]
1
378-376/428-S/80023
2 Foreign Relations, 19691976, Volume XXI
or so. There are a few favorable aspects, notably the new US invest-
ments under the copper expansion agreement and the likely continua-
tion of substantial foreign assistance over the next year. But the Frei ad-
ministration is already caught in a quandary of economic stagnation
with rapid inflation. As the elections approach, pressures for gov-
ernment spending on wages and welfare will almost certainly inten-
sify, and business confidence will probably reach a new low.
C. The outcome of the congressional elections of March 1969 will
have an important bearing on the selection of candidates and the for-
mation of political coalitions for the presidential election in 1970. The
PDC has some chance of winning a majority in the Senate and is likely
to retain a sizable plurality in the lower house. Nonetheless, faction-
alism within the PDC, the maneuvering of other parties for political ad-
vantage in the 1970 election, and Freis lameduck status will weaken his
influence over the new Congress.
D. Until the final choice of candidates and of political party align-
ments is made, it is not feasible to attempt to estimate the outcome of
the presidential election in more than the most general terms. Among
many possible outcomes, the current odds are that there will be three
major candidates for the presidency in 1970, that no one of them will se-
cure a majority, and that the Congress will select as president the candi-
date with the largest vote. If the Communist, Socialist, and Radical
parties could set aside their differences to agree on a candidate, he
would be a strong contender, especially in a three-man race.
E. Even if a Communist-supported candidate won in 1970 we do
not believe that the Chilean Armed Forces would intervene to prevent
his inauguration. They would maintain a constant surveillance over the
new administration, but would plan to move against it only if Chilean
institutions, particularly their own, were threatened.
F. The relations of any new Chilean administration with the US are
likely to be under repeated strains. Whoever succeeds Frei in the presi-
dency is likely to continue to stress Chilean independence; to be less co-
operative with the US on many issues than Frei has been; and to ex-
plore somewhat broader relationships with Communist countries. An
administration elected with Communist support almost certainly
would take steps aimed at moving Chile away from the US and closer
to the Communist countries. We believe, however, that for a variety of
reasons, including fear of a reaction from the military, such an adminis-
tration would be deterred from precipitate or drastic action.
G. Because Frei himself has gone on record as opposing outright
expropriation of the US copper companies, we see it as unlikely while
he is still in power. In our judgment, however, further steps toward
greater government participation in or even outright nationalization of
these holdings are inevitable. The manner, the terms, and the timetable
378-376/428-S/80023
JanuaryDecember 1969 3
of such steps will depend heavily on the makeup of the next adminis-
tration. Even under a rightist administration, or one of the center left
such as Freis has been, some additional Chileanization, at least, is
likely. Chile might assume high economic costs in the process, espe-
cially in case of abrupt nationalization; but in the long run nationalistic,
political groundsrather than economicwill almost certainly be the
crucial factors in deciding this question.
3
[Omitted here are the Discussion and Sections IIII.]
3
Mr. Thomas L. Hughes, the Director of Intelligence and Research, Department of
State, believes that the Estimate overstates the criticality of the Chilean economic situa-
tion and the Frei governments responsibility for it, as well as the Christian Democratic
Partys predicament in the forthcoming elections. He believes:
a) That copper prices and production are likely to be better and pressures for wage
increases less disruptive than indicated;
b) That the agricultural difficulties are of a longstanding nature and, therefore, less
attributable to President Frei and his policies than the Estimate leads one to believe;
c) That the Christian Democratic Party, especially its reformist but moderate ele-
ments, is stronger than the Estimate suggests; and
d) That whatever the short-run trends may be, the long-run direction is toward re-
form, even radicalism from the conventional point of view, and that the dissatisfaction of
some important elements, which inevitably accompanies moves toward change, is coun-
terbalanced, more than is shown, by favorable political reactions of elements that have
benefited. [Footnote is in the original.]
2. Editorial Note
On December 24, 1968, Ambassador to Chile Edward Korry spoke
at a Country Team meeting at length regarding National Intelligence
Estimate 9469 and criticized many of the findings of the NIE (Docu-
ment 1). He based his discussion on a November draft he had read in
Washington. Korry remarked, it is troublesome to note the striking ab-
sence of any mention of the fact that Chile is one of the few surviving
democracies in Latin America. This fact has important implications for
the incoming Administration, and is central to any assessment of the
success of our policies in Latin America, which are designed to pro-
mote and assist stable, democratic governments. The fact that Chile has
maintained democratic stability under President [Eduardo] Frei is an
achievement when one takes into account developments in recent
months in Peru and Brazil. Chile has a noisy democracy which is not
wholly effective but its maintenance of institutional order is not a
minor achievement.
378-376/428-S/80023
4 Foreign Relations, 19691976, Volume XXI
Korry went on to note: The plaint of the writers of the NIE that the
economic system has not functioned effectively is in some instances
identical with the Embassys. But other superficial judgments, which
tend to overlook the achievements within the context of Chilean his-
tory, are not helpful. The future of Chile is not exceedingly bright but it
remains of value to the US to have some democratic friends in its orbit.
This helps demonstrate the differences between US and Soviet objec-
tives and purposes and this is overlooked in the NIE.
The minutes concluded the following: The NIE report is resplend-
ent with hindsight views on economic developments which one need
not be so smug aboutthey are easy enough to see. But why, asked the
Ambassador, had the estimators failed to alert us to the poor perform-
ance of the Chilean economy in 1967 until long after all the returns were
in and the development was public knowledge. The NIE carries the dis-
turbing implication that the US can walk away from it all in Chile now
that the Frei Government is in trouble and the political horizon does
not reveal any outstanding leaders to consolidate the positive accom-
plishments of the past four years. It is indeed difficult to justify eco-
nomic assistance to a country in which the future is not bright on every
front. But this is an overly simplistic perspective and tends to overlook
our reasons for committing ourselves to Chile. Our policy has been ba-
sically successful (although President Frei was definitely oversold) and
we have stopped or at least stalled Castroism in Latin America. If, for
example in Chile, Allende had been successful in 1964 we would regard
the hindsight criticism of the NIE about economic performance as irrel-
evant. As long as the democratic, constitutional system of Chile sur-
vives, as long as fundamental reforms are being carried forward, as
long as the economy functions reasonably well, the USG investment is
worthwhile. (Department of State, ARA/AP/C Desk Files 19661968,
Lot 71D18, Political 7Country Team Minutes)
In airgram 60 from Santiago, February 22, Korry further criticized
NIE 9469 and took the unusual action of commenting on it because of
the possible influence it would have on a new Administration, because
of the distorted view it could provide of the results of the nationwide
Congressional elections in a weeks time and because, frankly, I am dis-
mayed by the lack of attention to words and their significance. Korry
went on to say, the document gives no importance to the constitu-
tional and democratic nature of Chile; perhaps in strategic terms it does
not merit any particular importance, but I for one do not share a view
that perhaps involuntarily denigrates the significance of a still viable
democracy. He concluded: since the quality of the referenced docu-
ment is of such demonstrably dubious value, I would recommend that
the authoring agency send some competent economists to Chile to
study the facts. In view of the extraordinary gap between their views
378-376/428-S/80023
JanuaryDecember 1969 5
and the views of this Mission (which was not consulted at any time), I
would welcome such a visit. My second recommendation, and earnest
hope, is that this airgram will be circulated to all who received the orig-
inal document. In response to paragraph B of the NIEs Conclusion,
Korry noted that the Santiago stock market had just reached its highest
level ever, that a growth rate of 5 percent was expected, that the budget
had grown 6 percent in real terms in spite of extraordinary
drought-related expenditures, and that trade liberalization was in-
creasing. (Airgram A60, February 22; National Archives, Nixon Presi-
dential Materials, NSC Files, Box 773, Country Files, Latin America,
Chile, Vol. I)
3. Memorandum for the 303 Committee
1
Washington, March 14, 1969.
SUBJECT
Final Report: March 1969 Chilean Congressional Election
1. Summary
On 12 July 1968 the 303 Committee approved a $350,000 election
program proposed by Ambassador Edward M. Korry to influence the
outcome of the 2 March 1969 congressional election.
2
The program was
approved with the stipulation that periodic progress reports be sub-
mitted and, in satisfaction of this requirement, such reports were made
on 3 September and 27 December 1968.
3
This is the final report. It de-
scribes our support to 12 moderate congressional candidates and the
election of 10 of those supported[1 line not declassified]. It also cites
the effectiveness of support given to a splinter Socialist group in an ef-
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
through 1969. Secret; Eyes Only. No drafting information or attribution appears on the
memorandum. A handwritten notation on the memorandum indicates it was noted by
the Committee at its April 15 meeting. Embassy reports on the March 2 election are in
telegrams 781 and 807 from Santiago, both March 3. (National Archives, RG 59, Central
Files 196769, POL 14 CHILE)
2
See Foreign Relations, 19641968, vol. XXXI, South and Central America; Mexico,
Document 306.
3
The progress reports were memoranda to the 303 Committee, dated August 20
and December 5. (National Security Council, Nixon Intelligence Files, Subject Files, Chile
through 1969)
378-376/428-S/80023
6 Foreign Relations, 19691976, Volume XXI
fort to divide the left and the scope of election propaganda activities fi-
nanced and guided by CIA.
2. Background
The first instance of major covert involvement by the U.S. Govern-
ment in the Chilean electoral process occurred in the 1964 presidential
election when the Special Group (5412) approved an election operation
totaling [dollar amount not declassified] in support of Christian Demo-
cratic Party candidate Eduardo Frei. The operation was successful and
contributed to Freis election to the presidency of Chile on 4 September
1964 with an unprecedented 56 percent of the popular vote. In the next
electoral contest, the March 1965 congressional election, Freis party
scored an outstanding victory by capturing a majority of seats in the
Chamber of Deputies and about one-third of the Senate. There was a
covert election program in the amount of $175,000 approved by the 303
Committee for this election. There was no covert program for the April
1967 nation-wide municipal elections. In early 1968, however, it be-
came clear that a difficult situation could confront the U.S. in the Sep-
tember 1970 presidential election (i.e., a popular front candidate might
be elected) and that the 2 March 1969 congressional election would be
important in setting the stage for that later contest. Ambassador Korry
requested CIA to devise a covert support programto shore up the mod-
erate forces of Chile through a very selective election program which is
described below. It was estimated initially that the program would cost
$350,000.
3. The Approved Program
a. Objective and Rationale
The basic purpose of the election program was to influence the
composition of the Chilean Congress and to strengthen Chiles mod-
erate political forces in anticipation of the 1970 presidential election.
During 1967 the Chilean left had scored a series of important victories
and the moderate forces within the Christian Democratic (PDC), Rad-
ical (PR), and National (PN) parties were disorganized. Individuals
strongly in favor of a popular front coalition had taken control of the
pivotal Radical Partys National Executive Committee (CEN); in the
two congressional bi-elections held in that year a pro-Castro Socialist
and pro-Soviet Radical won; and within the PDC its most leftist, anti-
Frei elements had gained control of the partys leadership. It was ob-
vious, therefore, that if this trend were to remain unchecked the possi-
bility of a strong Communist-Socialist-Radical alliance in 1970 would
be very real. Against this background of a drift to the left, the election
program was formulated.
378-376/428-S/80023
JanuaryDecember 1969 7
b. Approach
Aselective approach was needed in this election because in each of
the three non-Marxist parties there were extremist elements for whom
support should not be provided. It was decided not to support any of
the parties, per se, where it would be impossible to control the ultimate
destination of funds, and instead to direct our support to moderate in-
dividual candidates within the non-Marxist parties. An election team of
key State/CIA personnel within the Embassy was assembled under the
Ambassadors direction to make the candidate selections. The election
team made extensive use of studies of voting patterns in the past three
elections [2 lines not declassified]. These analyses made it possible to dis-
tinguish between contests in which outside support might make a dif-
ference and those in which little or nothing could be done to affect the
outcome.
The second major aspect of the program involved (1) media opera-
tions to create a more favorable psychological climate for the moderate
candidates, (2) support to farm, slumdweller, and womens organiza-
tions to mobilize the vote for the selected candidates, and (3) support to
a splinter Socialist party (Popular Socialist UnionUSP) in order to ag-
gravate this split in Marxist ranks. The latter merits some elaboration.
The USP Socialists had split off in August 1967 from the regular,
pro-Castro Socialist Party (PS) which participated with the Commu-
nists in the presidential elections of 1958 and 1964 under the Popular
FrontFRAPbanner. The USPPS differences were more personal
than ideological, but it was quite clear that any division in the Socialist
vote could seriously hurt the PS in this election. In addition, the Mis-
sion believed that an effort should be made to help the USP survive as a
viable political entity and thus place an obstacle in the way of leftist
unity for 1970.
c. Funding and Security
The risk of exposure is always present in an election operation, but
to reduce it to the lowest possible level it was decided: a) to use [less
than 1 line not declassified] intermediaries as channels of funds both to
the candidates themselves and to all operational support mechanisms
and b) [1 line not declassified]. A propaganda mechanism was estab-
lished which provided some of the candidates with tailor-made cam-
paign support (posters, radio time, hand-out materials) with no hint of
U.S. involvement. [7 lines not declassified].
4. Implementation
a. Chronology
Between 12 July 1968, when the program received the approval of
the 303 Committee, and 2 March 1969, election day, the program
moved through three distinct stages. The first encompassed the period
378-376/428-S/80023
8 Foreign Relations, 19691976, Volume XXI
through 2 November, the day on which all party candidate nominees
became finally and officially inscribed. During these weeks the opera-
tion was planned in the field under the Ambassadors direction. The
first order of business was to review all of the electoral contests (all 150
deputy seats and 30 of the 50 Senate seats were to be filled) using the
aforementioned voting pattern analyses. Additional biographic and
political data were used which came principally from Embassy con-
tacts. All selections were considered tentative before 2 November be-
cause of the maneuverings within the parties and the uncertainty as to
the final electoral line-up until that date.
The second phase of the program took place in the months of No-
vember and December 1968 and January 1969. By early November al-
most all of the candidates to be supported had been selected and it was
then a matter of opening the funding channels, creating a propaganda
support capability, and activating the special interest groups and orga-
nizations in behalf of these moderate candidates.
The final stage of the programwas in February 1969 when the cam-
paign activity accelerated. This was due not only to the traditional last
minute rush of any campaign, but also because of a new law which re-
stricted newspaper, radio, and television campaign advertisements to
the last two weeks of the campaign. [4 lines not declassified]
b. Problems
One of the problems in this operation involved the Radical Party
candidates who initially were to be considered for support on an equal
basis with the candidates of the other two non-Marxist parties. The cri-
teria which applied in the selection process were quite precise; i.e., to be
considered for support there had to be moral certitude that the candi-
date would oppose a popular front candidate in the 1970 election cam-
paign or, if such a president should be elected, oppose his extremist
policies in the congress. Applied to the Radicals, who participated in
governing Chile from 1938 through 1964 first with the Marxists and
later with the rightists, this meant that few of them indeed could
qualify for support. With the exception of a select few individuals in
that party with strong ideological ties, one could not be certain which
way the average Radical would go when the chips are down in 1970, es-
pecially if a Radical were to be the popular front candidate. For prac-
tical purposes this reduced the operation to candidates of the Christian
Democratic and National parties.
Another problem bears mention. Originally, when analyzing the
statistical data on the 180 electoral contests, it appeared that thirty or
forty such candidates might be identified as qualifying for support.
When the field election team began to weigh the contests [1 lines not
declassified] only twelve such races were identified. Most of these in-
378-376/428-S/80023
JanuaryDecember 1969 9
volved individuals with a chance of winning and our support was pro-
vided to give them an edge and assure their victory.
c. Costs
In this election program approximately [dollar amount not declassi-
fied] of the approved $350,000 has been expended. Due to the reduced
number of electoral possibilities discussed above, less funds were
needed than originally anticipated.
A breakdown of total estimated expenditures is:
Support to dissident Socialist Party [dollar amount not declassified]
Support to 12 individual candidates [dollar amount not declassified]
Propaganda operations [dollar amount not declassified]
Special interest groups [dollar amount not declassified]
(women, farmers, etc.)
[dollar amount not declassified]
d. Effectiveness
Within its limited concept, the election program was successful.
Ten of the twelve candidates selected for support were elected: [1 line
not declassified]. The most significant single victory was that of [4 lines
not declassified].
Support to the dissident Socialist USP was particularly worthwhile
because its 52,000 votes deprived the PS Socialists of seven congres-
sional seats (six in the Chamber and one in the Senate), all of which
went to moderates within the Christian Democratic, Radical, and Na-
tional parties. The Chamber losses occurred in Antofagasta (won by the
PDC), Coquimbo (won by the PR), Aconcagua (won by the PDC), San-
tiagos fourth district (won by the PN), Curico (won by the PN), and Li-
nares (won by the PDC). The Senate seat loss occurred in the first sena-
torial district; it was lost to the PDC. In addition, the USP vote played a
great part in the PS failure to win two additional Senate seats, in the
seventh senatorial district (won by Bulnes) and a second seat in the
tenth district (won by anti-Communist Radical Raul Morales). Re-
porting from USP sources indicates that the [dollar amount not declassi-
fied] support provided by this program accounted for about one-half of
the USPs election expenditures. The USP elected no candidate of its
own, and although it has a carry-over seat in the Senate, it may not be
able to continue as a meaningful political force in Chile. In any case, the
regular PS has been badly damaged by the USP campaign and, instead
of having between 26 and 30 seats in the new congress, which is what
the total PSUSP vote would have produced, it now has only 19.
e. Security
In terms of security and public exposure the operation was tightly
conducted and without compromise. There have been no charges of
U.S. involvement in the usually vitriolic Marxist press.
378-376/428-S/80023
10 Foreign Relations, 19691976, Volume XXI
5. Conclusions
The operation was a limited one and it largely achieved its limited
objectives. In the total picture, however, it should be realized that
Chiles political moderates suffered a clear setback in the 2 March 1969
elections. What happened was a movement toward political polariza-
tion, with the conservative right and the Marxist left coming out the
greatest beneficiaries. In the present political climate the Communist-
Socialist front would stand perhaps an even chance of victory for the
presidency. (Much the same could be said of Alessandri on the right.) If
President Frei and the moderate Christian Democrats plan on winning
the presidential election, scheduled for September of next year, they
must move rapidly to improve the economy and to plan their strategy
for the elections.
4. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, March 25, 1969, 1700Z.
1160. Subj: Conversation with Frei (HQForeign Policy).
1. This cable is one of three (Foreign Policy, Chilean Politics and
Economic Policy) based on some three hours of private talk with Presi-
dent Frei March 24.
2. I deliberately provoked Frei into a discussion of foreign policy in
order to exercise a restraining influence on Foreign Minister Valdes at
the forthcoming CECLA meeting,
2
to rein some of the more free-
wheeling spokesmen of the GOC here and abroad and to advise Frei to
prepare and control personally the Chilean talking points to Governor
Rockefeller.
3
1
Source: National Archives, RG 59, Central Files 196769, POL 1 CHILEUS. Confi-
dential; Limdis. This is one of three cables Korry transmitted on March 25 reporting on
the subjects of Foreign Policy, Chilean Politics, and Economic Policy. Telegram 1161 is
Document 5. Telegram 1168 is published in Foreign Relations, 19691976, vol. E16, Docu-
ments on Chile, 19691973, Document 2.
2
A meeting of the Special Latin American Coordinating Committee (CECLA) was
scheduled for May 16, 1969, at Vin a del Mar, Chile.
3
Nixon announced on February 17 that Nelson Rockefeller, Governor of New York,
would lead a Presidential mission to Latin America to consult leaders on the develop-
ment of common goals and joint programs of action, which will strengthen Western
Hemisphere unity and accelerate the pace of economic and social development. (Public
Papers: Nixon, 1969, pp. 106107) See also Document 122, Foreign Relations, 19691976, vol.
IV, Foreign Assistance, International Development, Trade Policies, 19691972.
378-376/428-S/80023
JanuaryDecember 1969 11
3. I said there seemed to be a push-pull dichotomy in GOC as well
as other Latin governments with regard to US. At very moment when
President was expressing over national TV-radio hookups his recogni-
tion and gratitude for US assistance, some of his spokesmen took quite
an opposite tack. At Geneva, their Ambassador, whom I recognized
had supported Socialist Allende for President in last election, attacked
US rels with area; parts of his speech had been used a fortnight ago, in
far less offensive but not less ill-informed manner, by Foreign Minister
Valdes in public speech to UNDP meeting. If anyone could explain to
me the incomprehensible performance of his Ambassador to the UN
the past GA, I would be an eager auditor. Then last week his Foreign
Minister in announcing the forthcoming meeting of CECLA here
March 31 had gleefully announced that Latin America had always
sought to have an all-Latino meeting without the presence of the US.
4. After enumerating examples of push-pull phenomenon, I em-
phasized that I had no rpt no instructions of any kind to raise this sub-
ject with GOC. I was speaking with the same candor he had demon-
strated in providing me earlier the most intimate details of Chilean
politics and I was doing so because our joint efforts to strengthen de-
mocracy in Chile could not help but be damaged by some of the incau-
tious unjustified language. With CECLA about to convene, this was es-
pecially important. I did not want to create the impression that I was
seeking to strike some kind of bargain of aid in return for what Valdes
called servilismo. I did want him to know that there seemed to pre-
vail in his Foreign Ministry and elsewhere the Gaullist-type logic that
the US was the inevitable protector of the area and had no rpt no option
but to support Chilean democracy therefore permitting Chileans a lib-
ertinism in action and in speech which the US would simply have to
swallow. Such an assumption would be imprudent.
5. The President said that my point was well-taken although he de-
nied that Chile had in any way been connected with the CECLA
meeting taking place at this time. He had the same night of our dinner
together in Vina (Feb. 26) told the Foreign Ministry to advise Valdes in
Ecuador to seek a delay in CECLA since he was convinced that the co-
incidence of CECLA and IPC case would be inopportune.
4
Instructions
had gone the following day and Valdes had executed them. I noted to
Frei that following Valdes return he had in conversation with me re-
ferred to the then apparent delay of CECLA with great regret and that
somehow Valdes sentiment had been echoed by Chilean envoys
4
In October 1968, Peru expropriated certain assets of the International Petroleum
Company. Documentation on the U.S. reaction to the expropriation is in Foreign Relations,
19641968, vol. XXXI, South and Central America; Mexico, and ibid., 19691976, vol.
E10, Documents on American Republics, 19691972.
378-376/428-S/80023
12 Foreign Relations, 19691976, Volume XXI
abroad. Frei said he found that hard to believe but would look into it.
He still thought it was wrong to have CECLA now. However, it was his
firm understanding that it was Brazil manipulating things very clev-
erly who had pushed the meeting to its present date.
6. As for Chile exercising prudence at CECLA, he agreed. He did
so not rpt not to give pleasure to the US. Nor did he wish his references
to US cooperation in his public speeches to be regarded in such light.
His was no special virtue. He had done so and would continue to do so
when justified because it was right. He knew that his view was not rpt
not shared by all Chileans or even by many in his own party and that
therefore it did not help him politically. But this was the way he was
and he could not do otherwise. However, when I or other Americans
noted the loose tonguedness of Chileans, which was probably a special
trait of theirs, did we also recognize that he had been the most loyal
friend of the US these past four years in South America? Again, this
was no special virtue but did we still recognize the fact?
7. Valdes had an uncontrollable desire to show the party and
others that he was active and accomplishing things. This characteristic
was undoubtedly a weakness but Valdes truly appreciated the US and
we should try to keep things in that perspective. He talked too much to
newsmenand so had Minister of Interior Perez Zujovic this past
week; such things should not happen (he said it four times as he paced
the floor).
8. It may have been true that a kind of Gaullist outlook permeated
the Foreign Ministry in the past and perhaps elements of his party as
well. But it was quite the contrary now. The widespread impression
was that the US no longer considered Christian Democracy all that im-
portant as an alternative to Castroism or that even Latin America really
mattered.
9. Frei said he understood fully the preoccupations of President
Nixon. He could not imagine how a US President dealt with his
enormous responsibilities. It was logical as Kissinger had written in
Agenda for a Nation that the technological revolution in armaments had
altered the nature of big and small power relationships. Kissinger was
100 percent European in his outlook; he was indeed a European intel-
lectual who understood completely how Europeans calculated and
perceived; he was correct in postulating that the basis for peace de-
pended primarily on a US understanding with Europe. The US had to
concentrate first on that goal; it had to deal urgently with such over-
riding problems as Viet-Nam, Middle East and so on. A human being,
no matter how talented, could hardly handle such an array of external
priorities not to mention the domestic problems and have even a mo-
ment to think of a place such as Chile. President Nixon had more grasp
of the world situation than anyone in his government but facts were
378-376/428-S/80023
JanuaryDecember 1969 13
facts. The days when Chile counted for something in Washington were
gone. He wanted me to understand that he had expressed himself not
rpt not in anger nor even sorrow but as a Chief Executive who had to
deal with [garblereal needs?] to establish priorities in governments.
10. I stated the case for continuing US interest without denying the
priorities. I emphasized that in raising some preoccupations, it was be-
cause of my concern that a constructive US interest be maintained. I did
not wish him or his government to feel that I was seeking to impose any
muzzle since I thought that it was his responsibility to his nation to
state Chilean desires and preoccupations; if the US did not believe in
this fundamental right, we would not be ideologically different from
the Soviets. If the Chileans believed there should be a Latin structure
without the US, it was their right and duty to make the case, but the ar-
guments should be logical and the language serious; it could not be ce-
mented by a coarse glue of anti-Americanism, leaving us to see the
gaping holes of Latin disunity. Nothing would please the US more than
the development of great Latin coherence.
11. Frei said it was his understanding of our fundamental sym-
pathy that prompted him to talk to me freely; he did not go running to
De Gaulle or whoever the Soviet Ambassador was (what is that poor
types nameI have only seen him once) because they would not help
Chile. Only the US could.
12. He would write Gov. Rockefeller shortly since he felt this was
one very valuable opportunity to get through to President Nixon.
Korry
5. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, March 25, 1969, 1745Z.
1161. Subj: Conversation with Frei (#2Chilean Politics). Ref: San-
tiago 1160.
2
1. Freis interpretations of election results varies so little from our
own that I will eschew repetition here to focus on current issues.
1
Source: National Archives, RG 59, Central Files 196769, POL 1 CHILEUS. Confi-
dential; Limdis.
2
Document 4.
378-376/428-S/80023
14 Foreign Relations, 19691976, Volume XXI
2. Frei and Tomic had a very long meeting in the Moneda
3
the
week following the elections. Tomic analyzed Chilean problems, em-
phasizing his conviction that control of inflation and therefore gov-
ernment was impossible without the willing cooperation of Chilean
workers. The only way this cooperation and discipline could be at-
tained was by a government of Popular Forces; the only manner by
which such a government could be fashioned was the participation of
all popular forces in the formulation of its program and the selection of
its candidate. If there were not such a program, Alessandri might win
or not win, but in any event no PDC candidate could govern effectively.
Hence he argued in favor of the (Communist-planted) proposal that
there be a national convention of all Popular Forces to select a
common candidate and program. He would be the most likely candi-
date. (See Santiagos 1075 paras 5 etc.)
4
3. Frei told Tomic that such a tactic and strategy would be ruinous
for both the PDC and Chile. It was an absurdity that he would oppose
by every means. Aside from the dubious postulations, he told Tomic
that the realities of Chilean politics overwhelmingly negated Tomics
calculation of emerging as the popular candidate. In the event of
such a convention were the following:
A. Loyal Democrats would propose Tomic, the FRAP would hold
out for Allende and the Radicals would have the balance of power.
They would never accept Tomic and would vote for Allende.
B. The Communists would divide from the Socialists and the Rad-
icals would align with the anti-Tomic Socialists to which the Commu-
nists would adhere once they decomposed the PDC and destroyed
Tomic.
C. The convention would nominate Tomic. Adonis Sepulveda (one
of the most extremist Socialist powers) would become Director of In-
vestigations; Castroite Senator Altimirano would become Minister of
Foreign Affairs or even the Director of Social Security. Did Tomic really
believe such a government could last more than a fortnight? Didnt he
know Chilean history?
4. After Frei analysed some of Tomics ideological and socio-
economic assumptions, he told him he would oppose him by every
possible means if he pursued this cut rpt cut syndrome. Tomic
pleaded his case anew and Frei reiterated that although they would
maintain friendly personal relations, he would fight him all-out unless
he changed his mind. Tomic then asked what would Frei do in his
place.
3
The Presidential Palace in Santiago.
4
Dated March 19. (National Archives, RG 59, Central Files 196969, POL 14 CHILE)
378-376/428-S/80023
JanuaryDecember 1969 15
5. Frei replied that he would gather some of the 40 top PDC-ers of
weight (men like Hamilton, Carmona, Aylwin, Fuentealba) and map
a strategy whose tactic would be an independent PDC candidacy. He
would tell the group that he wanted an independent PDC definition
but that he would welcome support without conditions or commit-
ments from left or right. He would then in harmony with evolving pol-
icies of the GOC under Frei (who would jib his sail to conform) launch a
coordinated and united effort of the party for the elections. Tomic
could win if there were party unity and between party and gov-
ernment, backed by dedication, some luck in the weather and con-
tinued support from the US.
6. Tomics comment was Ah, Eduardo, that is the difference be-
tween us. You see things clearly always. I cannot. I have so many dif-
ferent pulls and tugs on my mind.
7. Inter alia of note, Tomic argued that the US would accept
gradual nationalization of copper, that the GOC should do so, paying
out their normal remittances to the copper companies in the form of
compensation. The US Ambassador had told him so. Of course, they
would and of course he did, Frei said, but he also told you that such ac-
tions would free up other capital. Do you think that copper and mineral
companies would invest after seeing Chile take some $6,000,000,000 in
investments from the copper companies and the US and then immedi-
ately nationalize?
8. Tomic also argued in favor of nationalization of foreign trade,
saying such a measure would block flight of capital (a Tomic obses-
sion). Frei said wealthy Americans and wealthy and not so wealthy
Frenchmen invested abroad. If he were not President of Chile, he told
Tomic, and if he suddenly had ten million escudos, didnt he think he
would invest one million [garbledown the?] road? He understood
perfectly why the Augustin Edwardses and the Yarurs of Chile did so
when the country had such a history of inflation and other unstabi-
lizing elements. You could not decree against such export of capital and
if you tried to do so, particularly when the amounts were not really sig-
nificant, (as the black market stability of the past year shows) it would
only accelerate the flight and decelerate investment and economic ac-
tivity in Chile.
9. Frei showed me letter he had just written to Tomic to be deliv-
ered same night. In it he reiterates his implacable opposition. He de-
cided to write following what he termed ridiculous spectacle of Ercilla
and Washington Post Tomic Interviews. In any other country a politician
would be utterly dismissed after such shenanigans. Tomic in effect had
argued like a homeowner who said he would negotiate with the home-
owners on either side of him but when questioned declared that he had
never mentioned the word neighbor. Interviews and subsequent ex-
378-376/428-S/80023
16 Foreign Relations, 19691976, Volume XXI
planations had persuaded Frei that Tomic was undeterred in his desire
to be PDC candidate by means of the cut syndrome.
10. Frei also formed political action committee of eight to capture
PDC Junta. He mentioned Senators Hamilton, Carmona, Aylwin and
Deputy Sanhuza among them. They in turn had organized twenty
teams of militants which had left Sunday to contact every PDC asam-
blea. He was confident that the no more than 15 percent of the party
which Terceristas and Rebeldes comprise would not impose their will
again. He lamented that this minority exploited the casualness of the
majority to such a degree it could dictate so easily in the past. A minis-
terial committee of three, (Valdes, Zaldivar and Castillo) were oper-
ating on his behalf in the Congress, with the Directiva and with others.
Ercillas report of a meeting in which a group of Ministers allegedly of-
fered a blank check to Tomic on program if he steered clear of alliances
with the Marxists was Tomicista propaganda.
11. Frei believes Tomic may still swing around to his view. In any
event he will not leave anything to chance at the crucial junta in May. If
Tomic were the candidate, and Frei said flatly he would be the strong-
est single man the party could present, and if Tomics strategy were ac-
ceptable, then Frei would agree to change two or three Ministers to con-
form to the need for unity. (Min Interior Perez Zujovic would be the
first to go, I suspect.) If Tomic did not play the game, then Frei did not
know what might occur. He thought there was some possibility of a
deal between Leighton and the Radicales. (Although he did not put
much stock in in it. I reckon he harbors more hopes than he will admit.)
He said he had talked with one time Vice-President of Chile (1946 fol-
lowing death of President Rios) Alfredo Duhalde (Radical) and that PR
President Miranda had been sending out feelers for a meeting with
Frei.
12. Frei said that he was not certain that Alessandri would win the
1970 elections. Between 30 and 35 percent of the electorate would be
easy for the ex-President, but above 35 he would encounter strong re-
sistance. If the PDC did not have a strong candidate and platform, Al-
lende or some other FRAP candidate would make a very strong bid
which might well be triumphant.
Korry
378-376/428-S/80023
JanuaryDecember 1969 17
6. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, March 25, 1969, 2050Z.
1171. Subj: Military Postscript to Conversation with Frei. Refs: San-
tiago 1160; 1161; 1168.
2
1. Frei told me there was a facile tendency to consider the Chilean
military as frozen in its apolitical posture of decades. He was no longer
so persuaded. He did not wish to over-dramatize nor overdraw the
current situation but he did want me to know of some recent events
which indicated a changing attitude.
2. On three separate recent occasions, different members of the
very highest brass in the Armed Forces had approached close collabo-
rators of Frei to inquire as to the Presidents probable reaction to a
coup. The soundings were taken with subtlety and finesse, but the mili-
tarys thinking had come through to the President loud and clear.
3. Frei said the military, as expressed in these probes, feared an Al-
essandri victory. The return of the right would provoke considerable
reaction from the Marxists and would lead to increasing confrontations
of the forces of law and order with the populace. They did not relish
such a prospect. Equally, they did not wish to see Chile under a Marxist
government. Hence, they were thinking about a brief military inter-
regnum in which Frei would be sent to Europe before returning to re-
sume democratic leadership (a very dubious eventuality indeed). The
supposed advantage for the President would be the maintenance of his
middle-of-the-road policies and the extension of his mandate; more-
over his return would be accompanied by at least a temporary but se-
vere diminution in Communist and other extremist leadership re-
sources since the military would act during the inter-regnum against
these elements.
4. In addition to the soundings, Frei knew that the three com-
manding officers of the three services had discussed this contingency
among themselves recently. (The new Navy CINC Admiral Porta told
me in private conversation recently that under no rpt no conditions
would the Navy permit a Marxist government.)
5. Frei indicated that he would not go along with this kind of cha-
rade although he never so stated explicitly and I did not rpt not probe
1
Source: National Archives, RG 59, Central Files 196769, POL 1 CHILEUS. Secret;
Exdis.
2
Telegrams 1160 and 1161 are printed as Documents 4 and 5. Telegram 1168 is pub-
lished in Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 2.
378-376/428-S/80023
18 Foreign Relations, 19691976, Volume XXI
at this time nor did I make any comment of any kind. (We have been
making more of an effort to know military thinking although severely
hampered by the impact of the restraints imposed on US military assist-
ance and other abrasive congressional attempts to control the level of
armaments.)
6. For the moment I agree with Frei that the foregoing disclosures
represent more an attitude than a plan, more speculation than action.
Also related is the fact that the Chilean Armed Forces are very gen-
uinely and greatly concerned with the almost daily news agency re-
ports from Buenos Aires appearing in the press here for the past two
months of new arms purchases by Argentina or new arms plants there
for each of the services. The military here knows of Argentine anxieties
over the possible election of a Marxist government in Chile and the pos-
sibility if not probability of an Argentine reaction. They are also con-
cerned by Peruvian attitudes and Bolivian hostility. They are deter-
mined to have some arms modernization come hell, high water or the
US Congress. Their pressure to this end on Frei is currently very
greatand to a large extent, justifiable by any objective examination of
the situation.
Korry
7. Memorandum for the Record
1
Washington, April 17, 1969.
SUBJECT
Minutes of the Meeting of the 303 Committee, 15 April 1969
PRESENT
Mr. Kissinger, Mr. Johnson, and Mr. Helms
Colonel Alexander Haig and Mr. William Trueheart were present for all items.
Mr. William Broe was present for Item 1.
1. Final Report on March 1969 Chilean Congressional Election and Oral
Briefing on Covert Action Operations in Latin America
a. Mr. Broe briefed the members on covert activities in the Latin
American area. In the discussion of the final report on the successful
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
through 1969, 303 Committee Minutes. Secret; Eyes Only. Copies were sent to Mitchell,
Packard, Johnson, and Helms.
378-376/428-S/80023
JanuaryDecember 1969 19
limited Chilean congressional election operation of March 1969,
2
the
Chairman raised the question of whether anything should be done
with regard to the presidential election in Chile in September 1970. He
stated that in a recent conversation a friend of higher authority had
urged higher authority to provide assistance to rightist Alessandri in
the 1970 presidential election. The members conceded that Alessandris
prospects are reasonably good but decided no immediate steps are nec-
essary since the presidential candidates are not yet formally declared.
b. Mr. Helms noted that when the candidates are declared an early
decision should be taken on whether or not there is to be covert support
to any candidate. He observed that a great deal of preliminary work is
necessary, and CIA has learned through experience that an election op-
eration will not be effective unless an early enough start is made.
[Omitted here is discussion unrelated to Chile.]
Frank M. Chapin
2
Document 3.
8. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, May 2, 1969, 2355Z.
1767. Subj: Imminent Copper Nationalization?
1. Summary: The Chilean Copper Accord of 1967 is, as the Dept. has
been made aware by our reporting, coming under ever more serious as-
sault from all sides in Chile, right as well as left and center. I am now
persuaded that the pressures for a change in the relationship between
the GOC and the Anaconda and Kennecott companies because of
windfall profits to Americans as result of high copper price is so great
that President Frei cannot possibly resist it. I am further persuaded that
within the next two weeks a major development will occur. I believe
Frei will make very effort to arrive at an amicable revision for the ac-
cord rather than consider expropriation, but if confronted with implac-
able company positions he will move unilaterally. I am utilizing the
1
Source: National Archives, RG 59, Central Files 196769, INCO COPPER CHILE.
Secret; Priority; Nodis.
378-376/428-S/80023
20 Foreign Relations, 19691976, Volume XXI
Nodis priority because some of the opinions and information con-
tained below are of such a sensitive commercial nature that they could,
if circulated beyond a very restricted level, do serious damage to the le-
gitimate interests of the US companies involved. I also believe that the
probable Chilean action, which is in no rpt no way linked to the IPC
case and the USG response will have direct impact on that problem as
well as very significant implications for US relations with all Latin
American countries. End summary.
2. The Copper Agreement or Convenio as it is known here was
approved by Congress in late 1967 after two years of consideration by
the Chilean Congress. The accord was in fulfillment of the Frei 1964
electoral promise to achieve Chileanization of the countrys greatest
natural resource and national asset as opposed to the Marxist demand
for nationalization. Anaconda which has a majority of its total raw ma-
terials in Chile went one direction while Kennecott, with less reliance
on its Chilean operation, went a different route. A third US company
Cerro de Pascua (now in merger talks with Standard Oil of Indiana) de-
cided to enter Chile for the first time under the agreement. The salient
points of the accord include:
A. Anaconda. It retained 100 percent ownership of its existing
properties, the largest in Chile. It agreed to put in fresh expansion capi-
tal of some $109 million to raise production by end of 1971 from 780
million pounds to at least one billion. It pledged another four year in-
vestment of $38 million to start a new mine in which the GOC would
have 25 percent of the equity. In return the effective tax rate on Ana-
conda was reduced about six percent to an average of about 54 percent
(fluctuating slightly according to production) and given a 20 year guar-
anty against new discriminatory taxes. (Previous GOC had always hit
the copper companies with taxes whenever they ran short of fiscal
resources.)
B. Kennecott sold 51 percent of its sole interest to the GOC, with
which it formed a new joint company (El Teniente) in which it also had
an 11-year management contract. The new company is investing $230
million to increase production from 360 million pounds to at least 560
million. The tax rate was reduced from quasi-confiscatory 87 percent to
an average of about 53 percent with the same non-discriminatory tax
provisons as Anaconda.
C. Cerro has a new mine under development in which the GOC
has 30 percent and which will cost about 155 million to develop by end
1971. (It would not rpt not be affected by the subject treated in this
cable.)
3. In all, including housing and other subsidiary works, the three
companies and the GOC will expend about $760 million in the four
year period pending 1971. The programs are each running at least on
378-376/428-S/80023
JanuaryDecember 1969 21
schedule and in the case of Kennecott about a half a year ahead of plan.
The flow of investment is at its peak currently.
4. A large share of the expansion program was financed by the
EXIM Bank. Unlike the GOC negotiating team, the EXIM tied the
conditions of repayment indirectly to the price of copper and directly to
the level of profits any year. For example, the joint Kennecott-GOC
company received a 15-year $100,000,000 loan with repayments to
begin three months after the completion of the investment program.
The normal annual repayment is to be some seven and a third million
dollars. But EXIM had a rider which said that one-half of the net in-
come of the company above an annual yield to the GOC of $51,250,000
in both taxes and profit-sharing would have to be repaid to the EXIM
in addition to the normal annual repayments.
5. The GOCs failure to protect its own interests in the same way as
the EXIMthat is, by linking the price of copper or profits to the tax
rate on the US companieshas been the major motivation behind the
current campaign to change the Copper Accord. When the GOC negoti-
ated with the US companies, it based its projections on a price of copper
of between 29 cents a pound and 35 cents. Copper for the last two years
has averaged above 50 cents projection and the windfall profits to the
companies have been very large indeed. A study done last year for
CIAP by US Professor Malcom Griffin, currently at Magdalen College,
Oxford, was so critical of the GOCs failure to protect Chilean interests
at the 29 to 35 cent price level, that both the USG and GOC had to inter-
vene last year to prevent circulation or publication of the report. Griffin
predicted that the eventual Chilean reaction would envenom relations
between our two countries. (What would he say about this years av-
erage price so far of 58 cents?)
6. I do not have the relevant figures on US remittances and profits
and they are going to be very hard to acquire since both company and
government, for similar motivation, are treating them as the highest
state secret since leakage would make the Frei government appear to be
incredibly naive if not treacherous negotiators and would depict the US
companies as callous profiteers. However, by the time I leave Santiago
for Washington Sunday night, I intend to have them, one way or
another.
7. What I do know is that if copper were to average 45 cents a
pound, let us assume for the years 197073, the Kennecott-GOC joint
company would have to repay the EXIM, under the accelerated pay-
ment rider, 100 million of the $110 million loan in four instead of the
contemplated 15 years. (The EXIM rider specified that the last ten mil-
lion of the loan would be repaid over the 15 year period whatever the
profit of the company might be.) This one hard piece of information
378-376/428-S/80023
22 Foreign Relations, 19691976, Volume XXI
gives an idea of the current profits, all other conditions, of course, re-
maining equal.
8. The mood in Chile can be gauged from the unprecedented
manner in which the Chilean Congress approved on Wednesday a
minor piece of legislation directed against Anaconda (our 1729).
2
In five
minutes without debate and with unanimity, all of the very compli-
cated Chilean legislative conditions were fulfilled and the law passed.
The businessmans party, the Nacionales, have been as vociferous in
their criticism of the GOC on this issue in the congressional debates as
any otherand, happily, none of the politicians have even a remote ap-
proximation of the true commercial facts in the situation.
9. There are several other significant factors which are worthy of
mention:
A. It was a unilateral GOC decision to base the Chilean export
price on the London metal exchange price rather than the US domestic
price. This decision of a few years ago meant that the selling price (and
hence profits) was considerably higher for the companiese.g. in 1968,
the spread was almost 12 cents a pound, with the US price averaging
40.54 cents and the Chilean selling price 52.47.
B. The GOC in December 1965 in secret negotiations with Gov.
Harriman here agreed to help the US anti-inflationary effort by selling
90,000 tons of its copper to US at 36 cents a pound even though the av-
erage price for the delivery period averaged close to four cents more
per pound.
3
Despite steadily rising world prices, Frei held to his
commitment.
C. The US taxpayer is hostage to the copper companies in the form
of aid guaranties which have a theoretical payoff of more than
$1,500,000,000 (billions) in the event of nationalization but which
in practical effect would require repayment of approximately
$600,000,000 (million) because of the concurrent guaranties. The guar-
anties might come into play in part even if GOC changed accords uni-
laterally without nationalizing.
10. What has provoked the urgency of the present situation is that
Frei prior to the opening of the new Chilean Congress on May 21 will
present an economic program for the remainder of his term (until Nov
1970). In that program he will propose a number of belt-tightening
measures which will imply sacrifices for many. (There is some talk of a
wage freeze.) He wants to leave office with a low rate of inflation
below 20 percent which is a very difficult target to achieve in a country
which has the most powerful Communist party in the hemisphere and
an equally large Socialist party to its left, the two controlling the ma-
jority of organized labor and comprising close to one third of the voters.
2
Telegram 1729 from Santiago, May 1. (Ibid.)
3
See Foreign Relations, 19641968, vol. XXXI, South and Central America; Mexico,
Documents 286288.
378-376/428-S/80023
JanuaryDecember 1969 23
The suggestion that Chileans sacrifice while US companies make wind-
fall profits would be rejected by every sector of the political spectrum
including Freis own party, particularly at a time when the high prices
and other copper issues are attracting increasing focus and mounting
criticism.
11. Yesterday the government party, the Christian Democrats
(PDC) began a four day meeting at a Junta Nacional to determine its
new platform for the 1970 Presidential elections. Frei and his Ministers
are maneuvering in every possible way to avoid a copper debate, but
they are fully aware, as I have been for some time and have reported,
that the copper issue can no longer be swept under the rug. In all my
discussions with the GOC on copper since my arrival here some 18
months ago I have taken the position that (A) relations between the
copper companies and the GOC should not involve the USG; (B) that
revision of the Copper Accords would undermine the reputation
of Freis and Chiles good faith; and (C) that reopening the issue
would frighten off the capital that Chile needs so badly for its own
development.
12. These arguments just wont wash any longer. Indeed our own
official negotiating position with respect to copper priceour justifica-
tion for reduction of planned US assistance because of the high level of
copper priceshas only served indirectly to remind the Chileans that
they are not benefitting proportionately from the astronomical price
level. Their tax take (including profit participation) for 1968 when the
Chilean copper selling price averaged 52.47 cents a pound was actually
lower than the fiscal revenue from US copper companies in 1966 when
the price averaged only 43.32 (from a review of available US official
data). So on the one hand they lose fiscal revenue and on the other they
are penalized US aid support. Of course, it must be emphasized that
Chiles dollar reserve position has benefitted considerably from the
higher price.
13. I have not talked to Frei on this subject for some months since
naturally I did not welcome the topic and since he did not want to raise
what is for him a very distasteful decision. He has always defended the
copper agreements. In his last TV-radio national speech on the drought
and related matters a month ago he emphasized that it was the huge
copper expansion investment and the influx of dollars which was fu-
eling all Chilean development. But I do not see how he can avoid the
issue any longer. If, as is his custom, he calls me before my departure,
and if the subject comes up, I intend to listen carefully, to reiterate that
this is a matter between the GOC and the companies, that anything he
does must be based on international norms (prompt, fair, adequate
payment), that there be no attempt at retroactivity, that he should avoid
the emotionalism that pervades the IPC issue, that he disassociate him-
378-376/428-S/80023
24 Foreign Relations, 19691976, Volume XXI
self from the Peruvian case, and that above all, he should demonstrate
his understanding of US sensibilities. If this conversation is to occur,
and if Frei were to act in a manner consistent with his past behavior, I
have a feeling that whatever the problems between him and the com-
panies here, he could indirectly aid US in the IPC case. That is, I admit,
putting the best face on an unwelcome situation. But Freis emphasis on
fairness to the US investor and on non-retroactivity would pull the rug
under the Peruvian position. Needless to say, lament adding still an-
other burden in burdensome times to you in Washington, but I for one
am not rpt not entirely pessimistic about this situation for reasons I can
explain more appropriately during my Washington consultations.
Korry
9. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, May 4, 1969, 2140Z.
1768. Subj: Copper. Ref: Santiago 1767.
2
1. As anticipated reftel President Frei invited me to his home last
night (Saturday) for some three hours. Discussion followed almost pre-
cisely my expectations per reftel.
2. Major topic on his mind was copper. Minister of Mines Hales
joined us for second half of talks when I asked for and Frei agreed to
provide data I had been seeking which I will hand-carry and also trans-
mit by Nodis rpt Nodis dispatch.
3. Specific points made by Frei were per reftel. He placed greatest
stress on his desire to maintain best of relations with US. He empha-
sized distinction between his motivations and style and those pursued
by Peru so far in IPC case. He explained he was informing me even be-
fore his Cabinet including Minister of Foreign Affairs because of his
1
Source: National Archives, RG 59, Central Files 196769, INCO COPPER CHILE.
Secret; Priority; Nodis. Attached to another copy of this telegram is a note from Haig to
Kissinger that reads: This has earmarks of a new crisis. Pete Vaky is preparing a memo
for your sig to President today. (Ibid., Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I) AMay 6 memorandum for the President sum-
marizing telegrams 1767 and 1768 from Santiago was initialed by Kissinger, although
there is no definitive indication that the President saw it. (Ibid.)
2
Document 8.
378-376/428-S/80023
JanuaryDecember 1969 25
concern for maintaining the best of terms with Washington and be-
cause of special friendship he has had with me. (I can confirm that no
one in Foreign Ministry is aware of impending actions by Frei since
very able Chilean DCM in Washington who very close to Minister gave
me Thursday most categorical assurance that nothing will happen re
copper prior to end of Frei term.) Frei said that only his Ministers of Fi-
nance and Mines were privy to his thoughts so far but he would inform
Min Foreign Affairs Monday.
4. He said that if the figures which he would furnish me prior to
my departure for Washington Sunday were to leak he would be made
to appear a traitor to Chilean interests and that the pressure for out-
right expropriation would become irresistible. He said he had always
defended the Copper Accords but that now he was both morally con-
vinced and politically persuaded that the reaction against him and
against the US would become overwhelming if he were not to rectify a
situation that had changed radically since the signing of the agree-
ments. These unexpected changes were the uncommonly high, sus-
tained price of copper and the program he would present to the
country in the next eight or nine days, a program which would involve
very great sacrifices from the majority of the Chileans. (He gave me a
good many of the details of the program; they will be difficult at best to
push through Congress and the labor sector even with changes in the
Copper Accord.)
5. He said he wanted two changes in copper. One was linking price
to tax. Saying he might be misinterpreting the US, he likened his situa-
tion to that of the USG when it discovered that a number of US million-
aires were not paying any taxes on their income. No one had done any-
thing wrong; it was just that circumstances had changed. Second, he
said that Anaconda was the target of every party for its failure to have
Chileanized any of its original properties (that is not to have formed
a joint company with Chileans as the others had done) and that the
pressure for its expropriation had become so great that in its own in-
terests, the company would have to sell some of its equity to the GOC.
Neither Kennecott nor Cerro de Pasco would be affected in this respect.
6. The first problem demanded an immediate solution, prior to his
announcing of his program. Therefore he was convoking separately to
Santiago the heads of both Anaconda and Kennecott early next week,
the invitations would probably be issued Monday. The Chileanization
of Anaconda was equally pressing but obviously the final terms of any
new agreement, assuming that the company was willing to negotiate
such an agreement, could not be finalized in a week. However, if the
company did not agree in principle, then Chile would have no recourse
but to move forward with expropriation. In the discussion over terms
of either Chileanization or expropriation, a difference emerged be-
378-376/428-S/80023
26 Foreign Relations, 19691976, Volume XXI
tween his more exigent Minister and the President. The President fi-
nally agreed with me that the Ministers terms could not be considered
within international norms. Freis final thoughts on subject struck me,
without wishing to prejudice any company view, as being within the
ballpark, however Frei would far prefer avoidance of any expropria-
tion measure. He agreed with every one of my positions (reftel).
7. The President is writing a personal letter to President Nixon
which I will have prior to departure. He will not inform his Embassy in
Washington of it nor any of the foregoing except for the invitation to
the companies.
8. I too have maintained the most complete discretion despite
qualms of conscience about the two companies with whom I have ex-
cellent relations. However, I would not wish to harm Chiles confi-
dence in the USG by disclosure of governmental dealings nor could I
take such a decision without instructions. In any event, the two com-
panies will be apprised very shortly. Also, it has been their habit, in
keeping with the principle of separation of business from government
to apprise us of sensitive matters after they have taken decisions in
their dealings with GOC.
Korry
10. Letter From Chilean President Frei to President Nixon
1
Santiago, May 4, 1969.
Dear Mr. President:
I have informed Ambassador Korry of the measures concerning
copper that the Government of Chile will adopt.
At this moment I am preparing for presentation to my country a
very complete program which will signify sacrifices by all sectors in
order to deal efficiently with control of the inflationary process which
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I. Secret. This translation and a copy of the orig-
inal letter in Spanish were sent to Washington in airgram A146 from Santiago, May 8,
along with data on the copper industry given by Frei to Korry. In the airgram, Korry
wrote, While I cannot vouch for the authenticity of all the figures, I did warn the Presi-
dent that if any errors were to be discovered later, it would not serve the good faith or
reputation of his government. He assured me that they had been triple-checked and that
the most sensitive ones had been taken from the balance sheets from the companies
which must submit their accounts to the Chilean Copper Corporation. (Ibid.)
378-376/428-S/80023
JanuaryDecember 1969 27
concerns me gravely and above all with measures designed to resolve
the consequences of the drought which affected us all last year and
which has constituted a catastrophe for this nation, having affected a
zone more than one thousand kilometers long which includes the most
productive agricultural provinces of this country, and the reduction of
water which has signified a severe rationing of electricity for the indus-
trial sector.
To present this plan and to exclude from these sacrifices the copper
producing companies is politically and morally impossible. On the
other hand, the conditions of the international market have changed
fundamentally and have produced de facto situations which it is abso-
lutely necessary to modify.
In adopting these measures in regard to copper I would like to
make clear some facts which to me seem essential:
1. During my entire administration I have desired to maintain the
best relations with the people and the Government of the United States.
It is my desire and my decision that these good relations should be
maintained forever and accentuated because I believe that cooperation
between our two countries is fundamental;
2. In adopting these measures I am not motivated by any political
interest. I take them because I believe that we have a fundamental
moral obligation and because these existing objective conditions more
than justify action on the part of my government.
Surely you will think that this is a problem concerning which inter-
vention by the Government of the United States is not appropriate
given that it concerns relations between my government and private
companies. This is so, but it has appeared convenient to me that you
know the reasons why I should proceed and the thinking which moves
me and the objectives which I pursue.
I have had given to the Ambassador all the figures and antecedents
in order that he can inform his government in a most complete and de-
tailed manner.
May I reiterate to you, Mr. President, my sentiments of friendship
and great esteem.
With cordial greetings,
Eduardo Frei
2
2
Printed from a translated letter that bears this typed signature.
378-376/428-S/80023
28 Foreign Relations, 19691976, Volume XXI
11. Memorandum of Conversation
1
Washington, May 7, 1969, 3 p.m.
SUBJECT
President Freis Proposed Actions Against the U.S. Copper Companies in Chile
PARTICIPANTS
Deputy Under Secretary Samuels
Ambassador Korry
Deputy Assistant Secretary Crimmins
A.I.D. Mission Director Weintraub
ARAMr. Szabo
AID: AA/PRRMr. Salzman
E/ORFMr. Katz
ARA/BCMr. Chapin
DMr. Baker
(1) A.I.D. Guaranty Program and American Copper Companies in Chile
Mr. Salzman began by giving the background of A.I.D.s expropri-
ation coverage in Chile, particularly with respect to the investment of
the American copper companies. A cardinal principle is that the A.I.D.
definition of expropriation in the guaranty contracts is in general terms,
rather than exact and specific terms, so that precise opinions cannot be
given in advance. Many hypothetical situations will fall into a grey
area, where there could be a reasonable difference of opinion. In the
mining field, it is clear that a breach of the concession agreement per se
is not expropriation, although it could be if the breach comes under the
definition in the contract of guaranty. An across-the-board raising of
taxes would also not be expropriation, as long as the increase allows the
business to operate at a reasonably profitable rate. Reducing a com-
pany to the break-even point poses a moot question under law, al-
though confiscatory taxation would probably be nationalization under
another label.
With specific regard to the Anaconda copper companies, there are
three political risk or expropriation guarantees, all of which are cur-
rently on a binder or standby basis. These total $279 million, but none
of the coverage is in effect or current. An investor, in his sole discre-
tion, may elect only each year how much coverage he will have in effect
during the contract year and how much will be on binder or standby.
The critical date for all three Anaconda contracts is December 29 of
each year, and, on that date in 1968, Anaconda did not elect to place any
1
Source: National Archives, RG 59, Central Files 196769, INCO COPPER CHILE.
Secret. Drafted by Chapin; cleared by Crimmins, Feldman, Salzman (AA/PRR), and
Korry; and approved in D on May 13. The meeting took place in Samuelss office.
378-376/428-S/80023
JanuaryDecember 1969 29
coverage in effect. The amount invested by Anaconda as of December
1968 under the three contracts and which would be reimbursable by the
United States Government, if Anaconda had elected to go current, was
$206 million, and it is almost certainly higher today.
Kennecott, which is 51% owned by the Government of Chile and is
therefore not a candidate for expropriation and would not involve the
application of the Hickenlooper Amendment,
2
has a total expropriation
guaranty coverage of $84.6 million, all of it current. Similarly, the Cerro
Corporation, 30% owned by the Chilean Government but which could
pose a theoretical Hickenlooper Amendment contingency, had $14.2
million in total coverage, all of it current. Continental Copper, 30%
owned by the Chilean Government, had a total coverage of $25 million,
of which only $10 million was current. Thus the total political risk guar-
anty exposure of the American copper companies in Chile is $110
million with an additional $101 million in full effect in non-copper
industries.
Finally, the question of compensation offered by the country,
which is relevant to the Hickenlooper Amendment, is irrelevant for
A.I.D. guarantees. Under a guaranty, the investor turns over compen-
sation or rights to compensation to A.I.D., which is subrogated. Such
subrogation does not affect the expropriated companies rights to seek
compensation from the expropriating government for other parts of the
companies assets or rights not covered by A.I.D. investment guar-
antees. If the factual situation were clear, an American company with
an A.I.D. expropriation guaranty could walk in one day and ask to be
paid the next. In practice, in order to maintain the credibility of the
A.I.D. investment guaranty program in the American investing com-
munity, it has been A.I.D.s policy to pay off promptly, where fact of ex-
propriation was clear; a Biafran case was cited in this regard.
(2) General Outline of President Freis Intentions Toward the Copper
Companies
Ambassador Korry outlined the nature of President Freis pro-
posed course of action as follows:
At present copper prices, the Chilean Government hopes to obtain
$40 million in CY1969 from the American copper producing com-
panies and has tentatively calculated this as $36 million from Ana-
conda and $4 million from Kennecott. While the precise basis for the in-
creased tax receipts is not known at this time, it is understood that
President Frei was considering a formula which would permit the
copper companies to retain as profits, subject to current Chilean tax
rates, 50% of their receipts in excess of the cost of production in Chile.
2
The 1961 Hickenlooper Amendment required the cessation of aid to countries that
expropriated property owned by U.S. citizens and failed to provide adequate and timely
compensation.
378-376/428-S/80023
30 Foreign Relations, 19691976, Volume XXI
The discussion and rough calculations have taken as a point of depar-
ture production costs currently estimated to average 26 a pound. The
copper companies would currently be allowed to keep an additional
13 as profits but subject to current taxes on profits, which average
about 54%. The remaining difference between 39 and the price re-
ceived by the copper companies would redound almost totally to the
Chilean Government. President Frei was considering the possibility of
incentive payments to the copper companies if they reduced the cost
of production and certain unspecified but relatively small payments to
the copper companies if the London Metal Exchange price of copper
should exceed present levels. Presumably, present sales commissions
(such as the $4 a ton charged by the Anaconda sales company) would
be deducted from the price received by the American companies and
not be absorbed into costs in Chile.
In addition, President Frei would request the Anaconda Copper
Company to turn over 51% of the shares of its two wholly-owned com-
panies operating in Chile (exclusive of the new, not yet on-stream Ex-
otica Company of which 25% is owned by the Chilean Government),
but the timing and precise payment arrangements for this share of the
companies stock have not been determined. President Frei told the
Ambassador that payment would be on international norms, i.e.,
prompt, fair and adequate payment, and without any element of
retroactivity with regard to sales or profits. While there would be time
to work out this arrangement, provided Anaconda agreed in principle
to sale of 51%, President Frei wishes an immediate answer from the
companies on the tax issue, because he wishes to incorporate the new
measures imposed on the copper companies in the programwhich he is
preparing to present to the Chilean nation before May 21, when the
newChilean Congress convenes. President Frei has stated that this pro-
gram will mean sacrifices by all, and the copper companies cannot be
excluded.
It was Ambassador Korrys assessment that President Frei could
not be dissuaded from proposing the above demands on the copper
companies and that he had probably in fact already approached Ana-
conda, possibly within the last 24 hours. Mr. Samuels commented that
he had sat next to the President of Kennecott, and the latter had seemed
entirely relaxed and had not mentioned the Chilean situation at all.
(3) U.S. Government Attitude and Action
Ambassador Korry said that, in his view, the biggest stick was in
the hands of the American copper companies, who could decide not to
continue their five-year investment program, scheduled to reach a total
of approximately $750 million, including local currency expenditures,
by 1970 or 71. A cutoff of the investment program was a particularly ef-
fective weapon at the moment because the flow of investment from the
American companies was currently at its peak.
378-376/428-S/80023
JanuaryDecember 1969 31
(a) Effect of Hickenlooper Amendment
With regard to the specific applicability of a cutoff of aid under the
Hickenlooper Amendment, Ambassador Korry outlined the relatively
modest educational sector loan currently being disbursed, the technical
assistance program, the proposed $10 million agricultural sector loan,
and possible project loans and concluded that in the event that the
Hickenlooper Amendment was invoked, there would not be much to
lose from the Chilean Governments point of view. The Ambassador
believed that the Government would have been more interested in this
possibility had the $20 million program loan negotiations conducted
since January 20, 1969 resulted in a program loan. He expressed his
opinion that there was a correlation between the $20 million program
loan under negotiation, the additional $20 million which had been ten-
tatively discussed as coming from FY70 A.I.D. appropriations, and the
total amount of $40 million which President Frei was seeking to obtain
from the copper companies. Had the first program loan been forth-
coming, he believed that the Chilean Government would only have
sought to impose additional forced loans on the American copper com-
panies in Chile, as the Government had in 1968.
Ambassador Korry and others noted, however, that a cut-off of aid
under the Hickenlooper Amendment was not really now at issue be-
cause (a) the Chilean Government would almost certainly propose
compensation for any expropriation, (b) the compensation would prob-
ably be effective, (c) the six months provided by the Hickenlooper
Amendment as well as the legal process in Chile would take a consider-
able period of time, (d) the Hickenlooper Amendment could not be in-
voked until such time as the legal procedure was exhausted, and (e) the
Hickenlooper Amendment did not apply to Kennecott, which was al-
ready 51% owned by the Chilean Government. It was also noted that
even if there was no specific Hickenlooper Amendment problem, there
would be a general tendency to link this with the Peruvian case.
(b) Program Loan Negotiations
Mr. Chapin summarized the history of the program loan negotia-
tions, the difficulty in obtaining final approval of the authority to nego-
tiate in January,
3
the initial and continued opposition by Treasury and
the Bureau of the Budget, and the profound change in the factual situa-
tion underlying the program loan. The program loan had been predi-
cated inter alia on an average annual copper price of 45 compared to
3
See Foreign Relations, 19641968, vol. XXXI, South and Central America; Mexico,
Document 309. Telegrams 183 and 184 from Santiago, January 15, 1969, contain addi-
tional information. (National Archives, Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I)
378-376/428-S/80023
32 Foreign Relations, 19691976, Volume XXI
the current 60, and a prospective Chilean balance of payments deficit
of $70$90 million.
(c) Impact of Chilean Action on U.S. Investment Guaranty Program
Mr. Samuels commented that action against one of the companies
causing a payment under the A.I.D. guaranty agreement would have a
very serious adverse effect on the Presidents whole program for in-
vestment guarantees and promotion of private American investment
abroad. Mr. Salzman noted that there might be an adverse influence on
the general investment climate and public opinion about American in-
vestment overseas, even if a payment did not have to be made. He also
noted that informed investors who were aware of the narrow limita-
tions and definitions in some cases of the A.I.D. guaranty program
would be understanding, should there be a pay out, but this would not
be true for the general public, which was not aware of the subtleties
and limitations in the program.
(d) Bearing on U.S. Government Policy on Joint Ventures
Mr. Samuels said that the President was generally well disposed
toward joint participation by foreigners with American companies in
overseas investment, that the question of foreign government partici-
pation with American capital was a special case, and that in any event
each situation must be considered on its own merits. Ambassador
Korry noted that the New York Times story May 7 of Mr. Meyers re-
marks before the Council for Latin America on May 6 indicated that we
were opposed to joint ventures. Mr. Salzman commented that the offi-
cial policy of the United States had been to be neither opposed nor pub-
licly in favor of joint ventures, although we were able to discreetly en-
courage joint ventures on a case-by-case basis when approached by
investors.
Ambassador Korry added that there was no question in Chile of
private participation in the American copper companies or purchase by
private individuals of a substantial amount of the stock. There simply
wasnt yet that kind of private capital available. There were a number
of people in Chile, including former Ambassador Tomic, who had long
been enamored of the possibility of, in effect, purchasing a share of the
American companies by using the amounts now being remitted each
year to the parent companies. The proposal was that the Chilean Gov-
ernment would take over all or part of the operating companies, con-
tinue their operation by the American management, but deduct the an-
nual remittances from some stated purchase price.
(e) Initial U.S. Government Position with the Copper Companies
Ambassador Korry proposed, and Mr. Samuels concurred, in an
initial United States Government reaction to the American copper com-
panies, when and if they approached the United States Government,
which would emphasize that it was the companies own decision
378-376/428-S/80023
JanuaryDecember 1969 33
whether they could work out a suitable arrangement on taxes which
would permit them to continue to operate in Chile. The primary re-
sponsibility for decision and action should not be assumed by the
United States Government, which should seek to place this burden first
on the companies.
With regard to the 51% Anaconda stock, the company should be
informed of the extremely limited ability of the United States Govern-
ment in the very short time frame to exert leverage on the Chilean Gov-
ernment, either through moral suasion or in the event that action was
taken which would eventually involve the Hickenlooper Amendment.
Furthermore, the United States Government should point out to Ana-
conda that the basic decision was theirs, whether they wished to stay in
Chile and continue operations or whether they wanted to, in effect, pull
out. Anaconda was, of course, free to terminate its further investment,
but this might only trigger an uncontrollable chain reaction. In any
case, the decision to withhold further investment was undoubtedly the
biggest stick, much bigger than anything which the United States Gov-
ernment could use. The question was whether the stick should be used
if Anaconda wished to remain in the country.
(4) Timing Factors in Chile
Mr. Crimmins inquired whether President Frei could actually con-
trol the situation once the proposals were put to the company and be-
came public. Would there not be a series of events which he could no
longer control, if the present tax decrees were opened up? Ambassador
Korry said that President Frei had veto powers. Moreover, he was
hoping to obtain enactment of a whole series of draconian measures by
the lower house of the outgoing Congress in which his Christian Demo-
cratic Party still had a majority and then have them enacted after May
21 by the new Senate in which the PDC has almost a majority. Such a
strategy (which Mr. Chapin noted was unsuccessful with regard to con-
stitutional amendments) obviously required a very tight timetable in
these waning days of the old Congress. It was unfortunate but impera-
tive that the companies decide whether they wanted to stay in Chile or
not within the next week to ten days.
(5) President Freis Letter to President Nixon
4
A further time pressure was that President Frei had given Ambas-
sador Korry a letter to deliver to President Nixon which is very general
and does not contain the specific proposals which President Frei in-
tends to make to the companies. It does assert that the President had
given the Ambassador all the figures and background data so that he
4
Document 10.
378-376/428-S/80023
34 Foreign Relations, 19691976, Volume XXI
would be able to inform the President and the United States Govern-
ment of all the background to his decision and the general nature of the
proposals he planned to make to the companies. (The data that the
Chilean Government is using was given to Ambassador Korry, and the
proposals that will be made to the company were also conveyed
orally.)
5
President Frei had expected this information to be conveyed to
President Nixon orally by Ambassador Korry, who would be able to
answer any of the Presidents questions. It was agreed as the meeting
broke up that the President would need a more comprehensive memo-
randum on the options available to him and the background provided
than the data now immediately at hand. It would be well to know ex-
actly what was presented to the companies, and perhaps their initial re-
action. In any event, President Nixon was leaving for Key Biscayne
later that evening and would not be back until Monday.
(6) Timing and Nature of Export-Import Bank Involvement
An additional factor of considerable importance was whether the
United States Government would request the Export-Import Bank to
reschedule the repayment of its loans and eliminate the rapid accelera-
tion feature. Mr. Samuels agreed to undertake this task, if necessary,
but it was agreed that the Export-Import Bank should not be ap-
proached at least until after the American copper companies had been
informed of President Freis intentions. Mr. Samuels asked to see Am-
bassador Korry again on May 8. (The Export-Import Bank loan papers
are being sought from AID/PRA.)
(7) Implications for A.I.D. Loans
Ambassador Korry said that under the present circumstances he
could see no reason to proceed with the program loan, but he did rec-
ommend that nothing be done to interfere with other A.I.D. activities,
notably the $10 million agricultural sector loan, which is in final stages
of preparation and could be authorized within a month or certainly by
the end of the fiscal year. There is also a $20 million petrochemical
project loan in advanced stage of preparation.
(8) Implications of the Critical Date for Investment Guaranty Coverage
The foregoing time frame concerning the 51% equity in the Ana-
conda companies should be read in the context of the critical date of the
Anaconda investment guaranty contracts, December 29. It is conceiv-
able that Anaconda could decide to stall the flowof capital until the end
of the year by slowly negotiating the sale of 51%, and then balk after
5
See Document 9.
378-376/428-S/80023
JanuaryDecember 1969 35
electing full guaranty coverage at year end. This would strengthen
their bargaining position and perhaps signify a decision to cash out
under the guaranty.
It should also be noted that, notwithstanding a declared Chilean
intention to pay for the 51% interest in dollars, Anaconda knows, and it
is possible that the Chilean Government might know or come to know,
that a payment in escudos for the 51% could well come under the A.I.D.
inconvertibility guaranty contract. Anaconda has binder coverage
against inconvertibility for the full extent of its new investment. Ana-
conda could opt on December 29 to make this coverage effective.
Hence, the negotiations could shift to an escudo one, with A.I.D. being
called upon to pay dollars and acquiring the corresponding escudos,
any time after December 29.
12. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, May 12, 1969, 2325Z.
1917. Subj: Copper. Ref: State 073583.
2
1. Charge and Weintraub transmitted points reftel to President Frei
today. Frei received us alone for about one hour.
2. Main point Frei made in response to our presentation was that
alternatives he believes he faces are not between doing nothing or
taking some action in respect to copper companies, but rather extent to
which action regarding copper can be delimited in its severity. Frei said
for past four years he has regularly defended Chileanization arrange-
ments, and it is this type of accord (a Kennecott type) that he would like
to reach with Anaconda. The alternative he sees is expropriation.
3. Frei stated that sentiment in Congress for outright expropriation
included, as one might expect, Socialists and Communists, but also the
bulk of the Nationals and probably the Radicals. (Frei stated that PDC
Deputy and Senator-elect Irureta received call from Patricio Phillips, a
National Deputy, which implied that Jorge Alessandri supported
Iruretas earlier proposal to nationalize Anaconda holdings, especially
Chuquicamata.) Frei also argued that the bulk of his own party, not
1
Source: National Archives, RG 59, Central Files 196769, INCO COPPER CHILE.
Secret; Priority; Limited Distribution.
2
Not found.
378-376/428-S/80023
36 Foreign Relations, 19691976, Volume XXI
only those who recently left PDC, but also who have remained, support
nationalization. His conclusion, therefore, was that unless he submitted
or had in hand an alternative proposal, he would be faced with nation-
alization legislation within a few days after Congress convened, and
that he could not control this process if this were to be the scenario. It
was this kind of irrevocable process which he hoped to avoid.
4. Frei said he had the impression from his conversation with them
that Parkinson and Brinkerhof of Anaconda appreciated this political
pressure. He also said he had the impression from Brinkerhof that if the
issue were merely some alteration of the tax arrangement, such as the
GOC has proposed, this would not present insuperable problems.
3
Frei
said, however, he is convinced that only altering tax arrangements no
longer sufficient and that he needs some general acceptance from Ana-
conda of the Chileanization scheme similar to that with Kennecott,
under which GOC would own percentage of Anaconda mines, to head
off outright expropriation and nationalization. Frei said he has asked
for a response from Anaconda by May 21, at latest.
5. With regard to present tax arrangements (Santiago 1891) Frei
emphasized that agreements were signed on the basis of copper at 29
cents per pound, even though the price had gone up to about 36 cents
by the time agreements were concluded. He noted that company tax
positions would be no different than now under his proposed formula
at a price fairly close to 45 cents per pound (assuming cost of produc-
tion would be about 30 cents per pound). He therefore did not believe
that what was being proposed was confiscatory. If prices dropped back
to 4045 cents per pound, surtax would not apply. Frei recognized that
there was some perverse incentive to increase production costs as long
as surtax was based on some percentage of these costs of production,
but he said formula was sought which would be equitable to com-
panies and government alike, both when prices were high and when
they dropped. Frei also made clear that his precise tax proposal not un-
changeable, but the best they were able to come up with to meet the sit-
uation. He said they would consider any better formula if one could be
found, but time was of the essence. Frei said that he did not believe that
this tax aspect alone frightened Anaconda but rather it was the combi-
nation of taxation plus equity changes.
6. Frei also gave some categoric assurances:
A. He said that as long as he is President, no matter what the
Congress might vote, he would never consent to any retroactivity.
3
Reports of Freis conversations with officials of Kennecott and Anaconda are in
telegrams 1891 and 1905 from Santiago, May 9 and May 12. (National Archives, RG 59,
Central Files 196769, INCO COPPER CHILE)
378-376/428-S/80023
JanuaryDecember 1969 37
B. Any compensation would fall within internationally accepted
standards, and he emphasized that Chilean law was in confromity with
these. He explicitly made the point that an acceptable standard was not
thirty year bonds (a point he probably made because of rumors floating
in Santiago that the copper companies should be recompensed in the
same way that land owners are being compensated under agrarian re-
form, i. e. with as little as 1 percent down and bonds for as long as 30
years).
C. He wishes the entire matter to proceed in such a way as to not
damage US-Chilean relations. He said his preferred formula is a negoti-
ated Chileanization. But even if the issue came to expropriation, which
he hoped it would not, he understands that the US would accept this as
long as compensation is just and adequate, and if other internationally
accepted standards are followed, and he said he absolutely intends to
follow these in the event it came to expropriation.
7. Frei told us that he has ordered that Finance Minister Zaldivar
be included in negotiations with the copper companies along with Min-
ister of Mines Hales since he knew that copper companies had a certain
resistance to Hales. He said that if a third person were needed, he
would probably nominate Carlos Massad, President of the Central
Bank.
8. Frei commented that the worst thing he thought the companies
could do, in response to the GOCs proposal was to cease the expansion
program, since he was sure this would inevitably lead to expropriation
which he hoped to avoid. When he was reminded that the companies
might not wish to continue the program when faced by an expropria-
tion threat by the Congress, he said this was the reason he wished to
have something in hand before the Congress beat him to the draw.
9. Comment: Freis perception of reaction of the Anaconda officials
may or may not be accurate. The reaction of the local Anaconda repre-
sentative, Richard Sims, in private conversation with Charge tended to
be negative on all points, although he did not speak for Parkinson or
Brinkerhof. With respect to Kennecott, Frei said that what was involved
in the surtax, based on present prices, might involve only an additional
$5 million from the company. The picture we have from the local Ken-
necott representative, Robert Haldeman, is less reassuring, at least as it
might affect the operations of El Teniente. These are points which we
will follow up on.
10. Our reaction is that we are well down an irreversible path to
some major changes in the relations between Anaconda and Chile
which could involve as a minimum Anacondas tax structure, as a max-
imum complete expropriation, and possibly something between the
two.
Dean
378-376/428-S/80023
38 Foreign Relations, 19691976, Volume XXI
13. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, May 19, 1969.
SUBJECT
Your Meeting with Ambassador Korry and Assistant Secretary Meyer on the
Chilean Copper SituationMay 20, 5:00 p.m.
You have agreed to see Ambassador Korry and Assistant Secretary
Meyer on behalf of the President so they can brief you on the Chile
copper situation. A brief biographic sketch on Ambassador Korry is at-
tached (Tab A).
2
Briefly the situation is as follows:
On May 9 the GOC informed the American copper companies
that it wished to renegotiate the terms established in 1967 under which
the firms now operate. Specifically, it seeks:
(1) to increase the tax rate on profits in excess of a normal level of
50% over production costs, and
(2) to buy part of the equity of Anacondas two operating com-
panies, as it did in 1967 with Kennecott. (Anaconda is now 100%
US-owned copper producer in Chile; Kennecott has a 49% ownership).
Frei argued that there is urgency in reaching such an agreement
because (1) it is the only way to head off rising political pressure for
outright nationalization and (2) it is necessary to the success of the stiff
anti-inflation program he must present to the Congress May 21.
The political pressures for nationalization are rising fast and this
may be an issue in the 1970 presidential elections; Frei probably is
trying to keep the initiative, head off a politically difficult problem of a
nationalization bill in Congress, and defend his 1964 decision to Chile-
anize the industry rather than nationalize. The agitation to nationalize
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I. Confidential. On May 10, Rogers sent a mem-
orandum to Nixon discussing developments in Chilean copper, recommending that
Nixon meet with Meyer and Korry to receive Freis letter and that the initial U.S. Govern-
ment reaction be to let the copper companies decide whether to seek an accommodation
with the Chilean Government. On May 16, Kissinger submitted a memorandum to Nixon
echoing Rogerss recommendations. Nixon declined to meet with Meyer and Korry, au-
thorized Kissinger to see them on his behalf, and approved Rogerss policy recommenda-
tion. (Ibid.)
2
Attached but not printed. No record of Kissingers conversation has been found.
378-376/428-S/80023
JanuaryDecember 1969 39
and the desire to revise the agreements are both fed by unusually high
prices which have given the companies windfall profits in the last few
years.
Frei has indicated that if a satisfactory negotiation of the pro-
posals is not achieved, he will seek legislation to the same effect; and in
those circumstances he may not politically be able to resist or avoid a
move in the Congress to expropriate.
The Companies have so far reacted calmly. Anaconda indicates it
will negotiate; Kennecott indicates it will talk but that it can agree to no
tax rise and will stand on the contractual nature of the investment de-
cree authorizing the expansion plans. So far, neither have asked the US
Government to intervene. If, however, agreement with the GOC cannot
be reached, or the companies decide to resist the GOC action, they may
seek to get us to use pressure and leverage on their behalf. We will then
be faced with the question of whether we should try to prevent or react
against the GOCs actions.
There appears to be no causal relationship with the Peruvian IPC
problem. Greater Chilean control of the copper industry has been a
major political issue for years, and what happens will almost surely be
the result of internal Chilean political and economic imperatives.
There is no immediate Hickenlooper problem, and possibly none
likely over the longer run. Expropriation is not impossible, but uncom-
pensated expropriation is unlikely in Chile. Kennecotts investment in
any case is not covered by Hickenlooper since it has a minority interest.
Some immediate problems are the following:
Is the tax proposal confiscatory? Not enough details have been
made known to the companies for them to judge the impact fully. Our
calculations indicate the proposals are not confiscatory, but that they
would result in a sizeable decrease in net income. Thus, future invest-
ment in expansion may be jeopardized.
Would legislation changing the tax base which in turn changes
the agreement under which the companies undertook expansion mean
a violation of a contractual agreement? The legal status of the present
operating conditions is unclear in this sense. Sanctity of contract may
be involved, and if so, local judicial remedywhich in Chile is a re-
spected systemis available.
A more fundamental issue, however, is what the status of foreign
investments should be and how much a foreign government may inter-
vene to promote or protect the interests of its investors. This touches on
Latin American sensitivities to the Big stick, to growing fear of
foreign control of economic sectors through conglomerates (the
378-376/428-S/80023
40 Foreign Relations, 19691976, Volume XXI
Servan-Schreiber thesis),
3
and to Latin American concepts of interna-
tional law and the limitations on diplomatic protection of foreign in-
vestors (the Calvo doctrine).
4
Coming on the heels of IPC, the Chilean action may well dis-
courage US investors at a time when development requires greater cap-
ital flow; it may encourage other governments to squeeze foreign in-
vestment for advantage. On the other hand, it is not clear that reduced
aid or diplomatic pressure are effective deterrents. Moreover, diplo-
matic intervention and pressure by us could actually inhibit the com-
panies from an otherwise acceptable accommodation to local political
conditions, i.e., they might feel they could use the USG and do not have
to compromise.
A basic issue we must consider, therefore, is to what extent the US
should officially involve itself in this situation, and, if it should, when
and for what purpose.
It is very unlikely that Frei can be dissuaded from some move to
increase the tax take and buy some equity in Anaconda. We almost cer-
tainly could not prevent him from doing so by economic pressure. To
try to do so would provoke a nationalistic reaction that could well
sweep the radical left into power in the 1970 elections and kill moderate
Conservative Alessandris chances (now the front-runner). It would
also surely stimulate support for nationalization and almost make it
inevitable.
The US thus has three options:
Actively pressure Frei to drop all plans and be prepared to use
our aid leverage to do so; this seems counter-productive as noted
above.
Stay aloof and let the companies try to work it out. This is our
present policy. It is reasonable, but runs the risk that negotiations will
fail, that the companies may not seriously seek to compromise, figuring
we will in the crunch have to bail them out if they force a confrontation.
In any case, developments are difficult to control and there is some pos-
sibility that we will still be faced with difficult protection problems
later.
Actively use our influence with both sides to persuade (1) the
companies to find an accommodation, and (2) the GOC to be reason-
3
In his book, The American Challenge, Jean-Jacques Servan-Schreiber addressed the
overwhelming influence of American investment on postwar European economies, but
advocated integration, innovation, and emulation, rather than autarky and protec-
tionism. (Servan-Schreiber, The American Challenge)
4
The Calvo Doctrine, named for the 19th century Argentine jurist and diplomat,
held that the laws of the host country, rather than international law or the law of the
home country, governed foreign investors and investments. (Calvo, International Law)
378-376/428-S/80023
JanuaryDecember 1969 41
able in its demands. This may not work either, and may appear to do-
mestic US interests to sacrifice private investment. But it makes an ef-
fort, and may give us the best chance of coming out of the present
situation with the fewest losses.
You may wish to discuss these general policy lines with Korry and
Meyer, and ask for their thoughts.
14. Letter From President Nixon to Chilean President Frei
1
Washington, May 21, 1969.
Dear Mr. President:
Ambassador Korry has delivered your letter of May 4
2
and ex-
plained the nature and background of your proposals with respect to
the copper industry in Chile. I am grateful, Mr. President, for your spe-
cial effort to inform me of the situation.
I understand that officials of your Government have now con-
ferred with senior representatives of Anaconda and Kennecott. Ambas-
sador Korry has also told me of your desire that any new arrangements
your Government may negotiate with these companies should be of a
mutually satisfactory nature, and of your determination to maintain
the traditional respect for legal rights for which Chile is so well known.
I know that, given the complex and technical nature of the economics of
the copper industry, careful and patient study will be given by all sides
to the problem. I share your hope that it will be possible to reach mutu-
ally satisfactory arrangements. I am certain, also, Mr. President, that
you share my belief in the great importance of maintaining an environ-
ment in which private as well as public capital can continue to play a
constructive role in economic development.
I was interested to hear of your energetic efforts to control infla-
tion, and can well understand the additional burden placed on the
Chilean economy by the continued drought in your country. I know
1
Source: National Archives, RG 59, Central Files 196769, INCO COPPER CHILE.
Unclassified. President Nixon signed the letter based on Kissingers recommendation in a
May 19 memorandum. (Ibid., Nixon Presidential Materials, NSC Files, Box 773, Country
Files, Latin America, Chile, Vol. I) Vaky informed Kissinger that he revised the Depart-
ment of State draft of the letter to express at least some mild words of caution to Frei.
(Memorandum from Vaky to Kissinger, May 17; ibid.)
2
Document 10.
378-376/428-S/80023
42 Foreign Relations, 19691976, Volume XXI
how much suffering and destruction a severe drought can cause, and I
was therefore pleased to hear of the recent rains.
I have asked Ambassador Korry to keep me closely informed of
developments in Chile, for I share with you a profound desire to main-
tain and strengthen the good relations which exist between our two
countries.
Sincerely,
Richard Nixon
15. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, May 29, 1969, 1708Z.
2192. Subj: Talk with Frei on Copper.
1. Although Frei had telephoned me from Vina immediately after
my return here last weekend to suggest an early meeting, I did not see
him until last night (May 28) because of his concern for his dying
mother and cluster of problems. By then, he had received full report of
my lengthy conversations in Washington May 22 and 23 with the two
special reps he had sent (Carlos Massad President of Central Bank and
Pepe Claro, Head of Chile Copper Corporation). Massad returned May
27 to Santiago after four day stay in US. He had reported to him my
suggestion that rather than openly break copper agreement with some
price-profit formula, they draft a non-discriminatory excess profits law
which might also bag some Chilean companies. I suggested that they
could even show their draft of such a law to Kennecott and to Ana-
conda and suggest the companies might wish to make a better deal by
direct friendly negotiation. He also reported to him on their conversa-
tions with EX-IM, with IMF, with IBRD and on their impressions of the
very favorable views the key elements in US society were taking of
Freis moderation. It was against this background that I discussed
copper with Frei and delivered the response from President Nixon to
his letter.
2
1
Source: National Archives, RG 59, Central Files 196769, INCO COPPER CHILE.
Secret; Priority; Exdis.
2
Document 14.
378-376/428-S/80023
JanuaryDecember 1969 43
2. Frei read the Nixon letter slowly and attentively and pro-
nounced it very good, very good, verrrrry good. I explained that
while the letter was dated the same day as his State of the Union speech
to the new Congress it was signed prior to that speech and was in re-
sponse to his original letter only.
3. Frei said he liked the excess profits idea. He urged me to stay in
closest possible contact with the five Chileans who would deal with
this problem. He would instruct all five to meet with me and not to take
any decisions without first sounding me. He said that while he recog-
nized that Minister of Mines Hales was anathema to the companies, he
wanted me to know that Hales, because of his Arab audacity, had
been the most effective in jamming the Frei moderation line down the
politicians throats. He said that Hales and Min Finance Zaldivar, his
two designated negotiators with the companies, had his fullest confi-
dence and that since both trusted me totally, it was important that I not
mirror any of the companies prejudices towards Hales. He added that
he understood the essential need for me to maintain total objectivity
since without it, I could neither influence his people nor the companies,
nor retain the confidence of the USG. (I had made this point repeatedly
to Chilean Amb and to special envoys in Washington and thus was en-
couraged to know that my views were reported accurately to Frei.) He
said that my role would be crucial to success of negotiations, that he
was extremely grateful for efforts this far, that he was ashamed for
Chile for political attacks I and US suffered here, and that he hoped we
would not be discouraged. (He was very pleased with Washington Post
editorial May 24.)
4. He said that he would not yield to political pressures come what
may. He knew that his line was the only morally justifiable one. More-
over it was in the best economic interests of the country. Inter alia, he
noted that no politician calling for nationalization (aside from Marxists
and not all of them) was thinking of such action without compensation
and that his PDC cohorts were not urging compensation by trickery of
30 year bonds as had been rumored in press.
5. He said that earlier this week he had met separately with PDC
Deputies and all of PDC Senators (except for Fuentealba on which
septel).
3
They had arrived to urge full nationalization immediately of
Anaconda. Frei said he had told them they shouted slogans without
understanding their import, that they were manipulated like trained
seals by the Communists without reading anything, without demon-
strating any intellectual or moral right to represent the Chilean people.
He asked them who would pay for nationalization? He asked them if
3
Not further identified.
378-376/428-S/80023
44 Foreign Relations, 19691976, Volume XXI
they know the value of Anaconda? He asked if they understood that
the productivity of the mines would have to be maintained by new
people? And even if such a management miracle were to be achieved,
did they understand that the operating costs of these enterprises ran
into the tens of millions of dollars and that from date of nationalization
to the date of some effective earnings, there would be a period of five
months while new stocks were accumulated. And did they know that it
takes a marketing organization to sell and that it was possible for
copper prices to go down in the near future and that the technology of
the US could make aluminum very much a substitute? He said these ar-
guments had had their effect. He added that Hales had been very tough
and loyal and successful with both PDC and others. Frei said he had no
illusions about the political sickness of Chile and that arguments based
on fact and reason were slim dikes against the flood of malice, ambition
and sloganeering of an election period. But he said that firmness was
the best weaponthat he had told the PDCers that if they yielded to
the extremists, the Marxists, on copper that there would be another
more extreme demand immediately thereafter.
6. Frei said that he did not worry terribly about Kennecott since
Chile with 51 percent of El Teniente could defend its interests by
various measures. The tough nut was Anaconda. I suggested that there
were formulae to enable the GOC to buy out Anaconda over an ex-
tended period of time which would give the company time to readjust
to its new situation and which would link the time-frame to the
earnings of both parties. After all, prices could go down and Chile
could discover it wished to use its resources for purposes other than a
buyout. The crucial issue might become semantical and since all
Chileans were Philadelphia lawyers, they surely could surmount the
mere obstacle of words.
Korry
378-376/428-S/80023
JanuaryDecember 1969 45
16. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, July 10, 1969.
SUBJECT
Ambassador Edward Korry
Ambassador Edward Korry has been our Ambassador in Chile
since the beginning of 1968. He has done an excellent job and is prob-
ably the best Ambassador we have in Latin America. He has won the
friendship and confidence of Chilean government and civic leaders of
all parties and in all realms of activity. In this sense, he has done a really
extraordinary job. Added to that is a very perceptive understanding of
the Chilean situation, and an ability to analyze and articulate it usefully
and graphically. You will recall that the Chilean Foreign Minister, in his
talk with you, asked that Korry be left in Santiago.
He has just played an important and key role in the Chile negotia-
tions with Anaconda, for which Korry was personally congratulated by
Secretary Rogers (see attached cable).
2
With Chile entering a very crucial electoral period, which will cul-
minate in the Presidential elections in September 1970, Korrys knowl-
edge of the scene, the actors, and his perceptive understanding of the
situation and the US interest will be invaluable. Chilean leaders and
politicians have such remarkable confidence in him, that he is in a posi-
tion to be very persuasive and influential during a period when we will
need influence.
I therefore believe that it is very much in our foreign policy interest
to have Korry remain as Ambassador through the election period and I
hope no change will be made. No matter how capable any replacement
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I. Confidential; Exdis. Attached is a note from
Vaky to Kissinger: Per our conversation this memo is for you to use with Flanigan. I now
understand that a tentative decision has been made to send Hurd to Chile. Korry has
been queried by wire as to whether he sees any problem in Hurds going to Chile. I hope
you can raise this with Flanigan soonest. In telegram 2995 from Santiago, July 14, Korry
noted that John Hurd would face insuperable obstacles to effective performance given his
close ties to the oil industry and the bad publicity surrounding his nomination as Ambas-
sador to Venezuela. Korry also criticized the suggestion that he be nominated as Ambas-
sador to Venezuela, noting that he would be viewed as a specialist in massaging Chris-
tian Democrats, and that the idea that he could be promoted from Chile to Venezuela
would be taken in Chile as an insult. (Ibid., RG 59, Central Files 196769, POL 17
USCHILE)
2
Attached but not printed is telegram 109522 to Santiago, July 2.
378-376/428-S/80023
46 Foreign Relations, 19691976, Volume XXI
was he could not be immediately effective until he becomes familiar
with the situation and until the Chileans get to know him. For a great
part of this delicate pre-election period then, a replacement would not
be markedly effective.
17. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, July 11, 1969.
SUBJECT
ChileAnaconda Copper Agreement
On June 26, President Frei announced that the Government of
Chile and the Anaconda Corporation had reached agreement on a
negotiated nationalization of Anacondas copper holdings. The
agreement climaxed several weeks of negotiations and of steadily
rising political pressures, and has significance as a possible model for
future foreign investment problems in Latin America.
Background
Chile is the worlds third largest copper producer. Copper
earnings provide about 75% of Chiles foreign exchange receipts and
about 1015% of its revenues. Expansion plans now underway will
sharply increase those earnings in the next two or three years.
Subsidiaries of Anaconda and Kennecott have produced three-
fourths of Chiles copper output. Cooperation between Chile and the
U.S. on copper arrangements has been effective since World War II.
However, a rising tide of sentiment in Chile for greater national control
and even outright nationalization made copper a key campaign issue in
the 1964 presidential campaign. Frei and the Christian Democrats
espoused Chileanization to counter the Marxists support of
nationalization.
Freis victory led to the Chileanization agreements of December
1964 in which Chile acquired 51% of Kennecotts Braden subsidiary,
25% of a new Anaconda (Exotica) mine, and 25% of the mines to be de-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I. Confidential. Sent for information. A stamped
notation on the memorandum indicates the President saw it.
378-376/428-S/80023
JanuaryDecember 1969 47
veloped by Cerro and Continental Copper. The copper companies
agreed to increase and improve their refining capacities with a total in-
vestment of at least $750 million, of which Export-Import Bank agreed
to provide $225 million. Virtually confiscatory taxes were reduced and
the companies were guaranteed 20-years non-discriminatory tax treat-
ment. A.I.D. issued investment guarantee insurance for the invest-
ments. (Ironically, Anaconda chose to give up its expropriation guar-
antee during 1969 in order to save the insurance fees; thus, regardless
of the outcome of the negotiations, Anaconda would not have been eli-
gible to make a claim for expropriation based on Chilean action in
1969.)
However, several factors developed which led to the Chilean deci-
sion to proceed against the copper companies in May 1969, only two
years after the earlier agreements had come into effect:
The Christian Democrats (PDC) lost badly in the March Con-
gressional elections and faced a Presidential election in September 1970
divided into quarreling factions and aware that nationalization would
again be an important Marxist issue.
Anaconda aroused the Government and public opinion by
feuding over customs duties on capital imports, suing against
Government-established sales prices to domestic processors, and
staking out extensive non-copper mineral claims while failing to estab-
lish an earlier agreed-upon joint exploration company. These acts led
on April 30 to unprecedented, unanimous and rapid Congressional ac-
tion depriving Anaconda of its new claims.
Copper prices have risen steadily since 1964 and have been at
extraordinarily high levels for the third year in a row, averaging over
60 a pound this year. Chile believed it had provided the American
companies with windfall profits and cheated itself of its proper share in
the Chileanization program by agreeing to lower taxes guaranteed for
twenty years with no escalation clause pegged to copper prices.
Perus expropriation of IPC, although not a major factor, prob-
ably contributed to pressures against Anaconda.
The Negotiations
You may recall that President Frei sent a letter to you on May 4,
2
assuring you that he wished to maintain good relations and would
abide by international norms in obtaining greater tax revenue and
Chilean participation in the American companies. Anaconda and Ken-
necott were approached on May 9, primarily on the tax issue.
3
Ana-
2
Document 10.
3
See footnote 3, Document 12.
378-376/428-S/80023
48 Foreign Relations, 19691976, Volume XXI
conda was forthcoming on taxes but balked at allowing more than 25%
participation in its wholly owned subsidiaries. Kennecott was intransi-
gent, citing its earlier sale of 51% equity. Freis State of the Nation
speech on May 21 publicly stated the goals previously set forth to the
companies and the U.S.
4
His proposals for a negotiated settlement,
rather than outright nationalization, and his defense of Chileanization
were received coldly in Congress. By early June, even the PDC had
formally called for full recovery of minerals from Anacondas
subsidiaries.
Serious high-level negotiations with Anaconda began on June 2.
5
They continued virtually uninterrupted until agreement was reached
on all major issues on June 26. Ambassador Korry played a brilliant,
imaginative and essential role throughout as a behind-the-scenes go-
between. His contribution was highly praised by both sides. He
achieved the essential U.S. objective: a negotiated, mutually acceptable
settlement, without any public attacks on the United States or any indi-
cation of the U.S. role.
Main Points of Agreement
Although no documents are available, Chilean and Anaconda
sources indicate the following points of agreement:
Chile acquires 51% interest in two new Chilean companies
which will receive the assets and liabilities of Anacondas Chile Explo-
ration and Andes Copper companies on January 1, 1970. Chile will start
receiving substantially higher taxes beginning June 1, 1969, and prefer-
ential dividends after September 1.
The purchase price of $197 million will be based on book value.
Anaconda will receive 6% tax-free dollar denominated Chilean
Government agency bonds payable in 24 equal semi-annual install-
ments. The agency, CORFO, has a good international financial reputa-
tion and was preferred by Anaconda as the issuer.
Chile will purchase the remaining shares of the new companies
after it has completed payment for at least 60% of the first 51%, not be-
fore January 1973 but not later than December 31, 1981. The purchase
price will be determined by multiplying the average annual net
earnings from January 1, 1970, to the date of purchase by a varying
multiplier which declines from eight for 1973 to six for 1977 and there-
after. The value of the 49% will be approximately twice that of the ini-
tial 51%, or about $400 million.
4
Freis speech was reported in telegram 2080 from Santiago, May 22. (National Ar-
chives, RG 59, Central Files 196769, INCO COPPER CHILE)
5
The beginning of the negotiations was reported in telegram 2228 from Santiago,
June 2. (Ibid.)
378-376/428-S/80023
JanuaryDecember 1969 49
The administration, sales and management of the new com-
panies will be in accordance with policy determined by the Boards of
Directors, on which Chile will have majorities. Anaconda will have an
assistance contract for a minimum of three years for which it will re-
ceive 1% of gross sales, or about $5 million annually.
Higher Chilean taxes up to an effective rate of about 80% on
profits from Anacondas retained interest will be calculated on a com-
plicated sliding scale based on copper prices over 40 a pound.
Similar taxes must be applied to other large copper companies
by the end of 1970 or Anacondas paid-in taxes will be refunded over
time.
Present investment programs will be completed and existing,
Chilean-approved copper sales agreements will be honored.
Significance of The Agreement
The achievement of a negotiated agreement has removed the im-
mediate threat of outright expropriation and the possibility of a
U.S.Chile confrontation a` la IPC. The Marxist parties will continue to
press for nationalization, but Frei now has them on the defensive.
If the agreement holds, Frei will have deprived the leftist opposi-
tion of an important election issue in the 1970 Presidential elections.
The agreement has also done much to strengthen and unify the frag-
mented Christian Democratic Party, which now has a platform around
which it can rally.
From a psychological point of view, the agreement removes the
abrasive historical legacy of Anacondas dominant position in Chiles
economic life. Anaconda has symbolized to Chileans their inferiority
and dependence on the United States. For the Chileans, the agreement
ends the pervasive influence in their affairs of a foreign state within a
state.
The significance of the agreement over the longer term is uncer-
tain. However, it is clear that this kind of negotiated settlement is
preferable to outright nationalization. Although Anaconda obviously
would have preferred a more favorable arrangement, the agreement
was acceptable to its Board of Directors. It is also significant that while
the U.S. Government played an essential part through Ambassador
Korry in achieving agreement, there has been no public awareness of
U.S. involvement. Thus, the issue has remained one between Chile and
a U.S. private company, not between the two governments.
378-376/428-S/80023
50 Foreign Relations, 19691976, Volume XXI
18. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, July 24, 1969, 1830Z.
3165. Ref: Santiago 1171.
2
1. MinDef General Marambio at lunch with me July 21 at ARMAs
home said that he and his fellow chiefs in the Armed Services were de-
termined not to permit a government significantly influenced by the
Communists to gain power in Chile.
3
2. Under questioning (but with no rpt no comments from me of
any kind) Marambio confessed that there was no clear plan to imple-
ment this determination. He explained the historic reasons for the apo-
litical attitude of the Army and its almost total unpreparedness for the
assumption of power as well as the lack of any desire to have the reins
of government. He said the Armed Forces would need someone to put
into power and a large team of experts to run the government under
that person. He lamented that aside from President Frei there was no
such person and that Frei was not prepared to have an auto-golpe.
But he qualified that remark at another point by saying that Frei was
equally committed to the proposition that Chile cannot be permitted to
have a government dominated by Communist influence. Marambio
specifically described such a possible government as being led by a
radical such as Senator Baltra or by a Socialist. In other words, he was
talking about a Popular Front government. Needless to say, he does not
include in his definition of unacceptability any government led by a
Christian Democrat, whether it was one of Popular Unity or not.
3. Marambio identified PCCh as the true threat. He said that only
the Communists had the organization and the discipline to benefit
1
Source: National Archives, RG 59, Central Files 196769, POL 15 CHILE. Secret;
Exdis.
2
Document 6.
3
On August 15, the CIA issued a Weekly Review Special Report on The Chilean
Military Establishment (SC No. 0073/6A) which predicted, As the presidential election
nears, reports of military plotting against the Chilean Government are certain to increase.
To some extent the military will simply be indulging in the time-honored Latin American
practice of keeping an eye on the civilian politicians. It seems probable, however, that
widespread public disorder coupled with a strong leftist candidacy could provide the
spark that would impel the military to move into the government. The report indicated
that the military might form a junta or, more likely, would find a prominent civilian to
run the government, drawing on technical expertise to undertake the necessary reforms.
It concluded that the provocation for a coup in Chile would have to be relatively grave,
considering the weight of tradition that is on the side of constitutionality. Nevertheless,
the apolitical nature of the Chilean armed forces can no longer be taken for granted. The
complete report is Document 8, Foreign Relations, 19691976, vol. E16, Documents on
Chile, 19691973.
378-376/428-S/80023
JanuaryDecember 1969 51
from the incoherence of the other parties. He mentioned that Socialist
extremists were lying low for the moment but would seek further pro-
vocative tests as they expanded their activities into other universities
and sought links with workers.
4. He said that the Argentine military and the Argentine Govern-
ment on two separate occasions had delivered to him what he could
only interpret as clear messages calling for preemptive Chilean military
action to forestall an Argentine initiative to eliminate any Marxist gov-
ernment that might come to power here. He disclosed that these mes-
sages were couched in the form of pointed statements to the effect that
Argentina could not stand by idly if Communist-dominated gov-
ernments were to assume power in Paraguay or Uruguay, and that in
the case of Bolivia it had helped to prevent such an eventuality. When I
asked Marambio if all this signified a requirement in his mind to act be-
fore the election preemptively or afterward when an unwanted gov-
ernment took office, he simply reverted to his lament about Frei and the
absence of alternatives to the President.
5. As in reftel, Marambio enumerated the well known reasons for
Chilean military discontent (wages, loss of prestige, poor equipment,
etc.) and coupled this with the observation that junior officers and
noncoms are increasingly susceptible to non-traditional propaganda
and impulses. He noted what has happened in Peru.
6. This led of course to some rather modest requests, notably an in-
sistence on the F5s, a new request for two C30s and arrangements to
send junior grade Chilean officers (one each from the three services) to
the US for one year as integral parts of an active unit. He thanked me
for the total of $11 million in MAP the past fiscal year and stressed the
importance of radio equipment and other counter-insurgency items.
7. Our comments and recommendations re foregoing para follow
in septel.
4
Korry
4
In telegram3198 from Santiago, July 25, the Embassy reported that Korry, in a July
24 call on Frei, referred to reports that the Chiefs of the Armed Forces were determined
not to permit a government under Communist influence to come to power in 1970. Frei
agreed and considered FebruaryMarch 1970 to be the crucial period, especially if FRAP
or another popular front-type candidate were clearly out in front at that time. Korry and
the Embassy were not as certain as Frei that the military chiefs were completely resolute
and sure of their ground, and were inclined to believe it might take a signal from Frei
himself to get the military to move. Korry did not consider it totally impossible that Frei
would give such a signal if Allende or another Communist-backed candidate appeared
victorious. (National Archives, RG 59, Central Files 196769, POL 15 CHILE)
378-376/428-S/80023
52 Foreign Relations, 19691976, Volume XXI
19. Intelligence Note Prepared in the Bureau of Intelligence and
Research
1
No. 707 Washington, October 3, 1969.
SUBJECT
Chile: Military Unrest Serious, But Frei Administration Should Survive
Widespread discontent and some serious plotting within the
Chilean armed forces have presented the Frei administration with a
grave problem and belie the traditional concept of the Chilean military
as apolitical. Concern over professional conditions, especially low pay,
has found increasingly organized and vigorous expression at certain
levels, and while an overthrow of the civilian government does not ap-
pear likely at this time, the possibility of an attempt by some portion of
the army cannot be ruled out.
Increased military politicization. Chileans are understandably proud
of the traditional noninvolvement of their military in politics, and
public esteem has both boosted military morale and reinforced the
armed forces strict professionalism. While as recently as last year some
400 officers threatened to resign unless a pay raise were forthcoming,
the supremacy of the civilian branch was not placed in question, and
there was never any danger of a coup. Since then, however, there have
been signs of increasing politicization within the armed forces. The Pe-
ruvian example
2
does not seem to have stirred any thoughts of emula-
tion, but other factors, such as general Chilean concern over the
countrys position as a democracy surrounded by military regimes, and
speculation over whether the armed forces might either remove or pre-
clude a Marxist government in Chile, may have heightened the mili-
tarys awareness of politics. It appears, nevertheless, that the prepon-
derant preoccupations have been professional: low pay, poor training,
inadequate equipment.
Plotting in the army. In the past several weeks, while coup rumors
in Chile were flatly denied in public by the government, clandestine re-
porting began to reveal the existence of a group, composed of some 40
field-grade army officers headed by a general, which felt strongly that
both the civilian government and the top echelon of military leaders
had gravely neglected the armed forces. The general is Roberto Viaux,
1
Source: National Archives, RG 59, Central Files 196769, POL 239 CHILE. Secret;
No Foreign Dissem; Controlled Dissem; Background Use Only. Drafted by Denney.
2
Reference is to the Revolutionary Government of the Armed Forces of Peru, led
by General Juan Velasco Alvarado, who staged a bloodless coup against President Fer-
nando Belau nde on October 3, 1968.
378-376/428-S/80023
JanuaryDecember 1969 53
commander of the First Division in Antofagasta, who is known for his
opposition to the Christian Democratic Party and to President Frei. He
has a reputation for competence and dynamism, and early this year
was linked to a plan to seize top-level military leaders in order to
compel an improvement in the economic conditions of the military. Ac-
cording to the most recent reporting, he now plans to depose Frei
unless the President agrees to replace Defense Minister Marambio with
Viaux.
Viaux scheming is known to the government and may be con-
nected with an urgent request by Frei on September 29 for heavy pro-
tection for his residence by the Carabineros, the paramilitary national
police force. Marambio is reportedly planning to remove Viaux from
command in early October.
3
Coup difficultbut might occur anyway. Viaux thus seems slated ei-
ther to accept defeat or make his move. We do not know the extent of
his following in terms of troops commanded, but any coup attempt
would seem certain to encounter serious difficulties. We assume that
the Chilean public and political parties would react negatively, and
widespread and violent acts of opposition would have to be antici-
pated, particularly from leftists. Viaux may be deluding himself about
the lengths to which his military colleagues are prepared to go in pur-
suit of a pay raise, and some splitting within the armed forces appears
likely.
The position of the crack Carabineros
4
is not known, but there is no
evidence that they have been involved in the plotting, and their com-
mander is considered loyal to Frei. They could play a decisive role, for
although they do not have the armys heavy equipment, they are its
equal in manpower; and defense of the president is one of their respon-
sibilities. Finally, the dissidents ability to obtain support could easily
be severely undercut by a pay raise for the military, and apparently
Freis administration is planning such a raise, although not very soon.
On balance, then, we do not feel that Viaux chances of a successful
coup are very good. Nevertheless, there always remains a chance that
Viaux will make his move, in desperation or based on a mistaken calcu-
lation of his strength. Thus Marambios acting to remove Viaux could
trigger a coup attempt in the coming week.
3
These reports were contained in two October 2 Central Intelligence Agency Intelli-
gence Information Cables, TDCS DB 315/0415869 and TDCS DB 315/0415969. (Na-
tional Archives, Nixon Presidential Materials, NSC Files, Box 773, Country Files, Latin
America, Chile, Vol. I) Additional Embassy updates and commentary on the growing
crisis within the military are in telegrams 4196 and 4197 from Santiago, October 6. (Na-
tional Archives, RG 59, Central Files 196769, POL 2 CHILE)
4
National Police. [Footnote is in the original.]
378-376/428-S/80023
54 Foreign Relations, 19691976, Volume XXI
20. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, October 21, 1969, 11:15 a.m.
SUBJECT
Reported Military Revolt in Chile
Press reports from Santiago indicate that two army regiments are
involved in a move against the government. [less than 1 line not declassi-
fied] was informed by the Commander of the National Police (Cari-
bineros) that fighting erupted in Santiago at 9:00 a.m. Eastern Daylight
Time.
2
The Associated Press reports that officers who tried to seize
command of the Yungay Regiment located just north of Santiago were
blocked by loyal troops and were arrested. However, rebellious officers
reportedly have taken command of the Tacna Regiment in Santiago.
The dissident officers are led by General Robert Viaux, who was com-
mander of the First Army Division in Antofagasta until last week when
he was forced to retire. Viaux had demanded the resignation of the De-
fense Minister and pressed for higher pay and a greater political role
for the military before his forced retirement. Viaux reportedly is with
the Tacna Regiment. Thus, the apparent immediate cause of the insur-
rection involves the Armys discontent with inadequate pay scales and
growing dissatisfaction with lagging professionalism within the ranks.
The Government has reported the military insurrection and urged
the people to remain calm. The Government said that the army com-
mand has taken the necessary measures to subdue the mutineers,
who are reportedly led by recently retired officers. The Government
has set up a nation-wide radio and TV hookup but has given no further
details of the revolt at this time.
We do not have a clear picture of the seriousness of the revolt or
the extent of the fighting in Santiago. We do not know whether other
Army units and the well-armed Carabineros will support the govern-
ment. Embassy Santiago believes that the Army is not yet united be-
hind Viaux. Any military insurrection by the normally a-political
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I. Confidential. Sent for information. A notation
on the memorandum indicates it was returned on October 23.
2
The CIA report was disseminated in Intelligence Information Cable TDCS 314/
1502369, October 21. (Ibid.)
378-376/428-S/80023
JanuaryDecember 1969 55
Chilean military must be considered serious. I will forward to you
shortly a more detailed analysis of the implications of the situation.
3
3
The collapse of the Viaux mutiny was reported the following morning in CIAs
October 22 OCI No. 2219/69. (Ibid.) On October 22, Vaky submitted to Kissinger a 2-page
memorandum for the President on the mutiny. Kissinger requested that it be shortened
to one page and updated. On Vakys covering memorandum to Kissinger is written
OBE 10/28/69. (Ibid.) No known updated memorandum for the President was
submitted.
21. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, October 22, 1969.
SUBJECT
CIA Press Comments on Chilean Situation
In the mornings Washington Post account of the Chilean events, a
CIA spokesman was cited as saying that CIA was aware of the situa-
tion for six weeks.
2
Yesterdays AP dispatches also carried the same
statement.
The Chilean Embassy has already reacted and asked what this
means.
This kind of statement is bound to create severe problems for us in
Chile. It is fair to assume that the Communists at least will use this
statement to charge U.S. connivance with General Viaux. The Chilean
Government may also become suspicious of CIA involvement.
I have already expressed my concern to Bill Broe, the Western
Hemisphere Office Director, over the CIAs commenting to the press on
events such as this. I think this is a very bad policy and will give us
nothing but headaches.
You may wish to speak to Helms about the practice of CIA com-
ments to the press on foreign events.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I. Confidential. Sent for information.
2
See Josh Goshko, 2 Units Revolt in Chile: Frei Claims Army Support Against
Rebels, Washington Post, October 22, 1969, p. A1.
378-376/428-S/80023
56 Foreign Relations, 19691976, Volume XXI
22. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, October 23, 1969, 0055Z.
4449. Subject: Statement of CIA Spokesman. Ref: State 178765.
2
1. Under Secretary Patricio Silva called me to Ministry this evening
to register sharp protest on subject. (AP story on spokesmans state-
ment has so far appeared only in Ultimas Noticias but it takes little imag-
ination visualize what El Siglos front page will probably look like
tomorrow.)
2. Silva said he speaking officially and formally for President Frei
and GOC. Asked that USG take immediate steps prevent further state-
ments this kind and use influence with wire service agencies to put an
end to additional stories about subject.
3. Again emphasizing that he speaking officially, Silva said he
wished to communicate to me that suspicions exist among high offi-
cials GOC re possible involvement CIA in events of last few days. He
did not specify who these officials might be but remarked that there
were certain indications which had raised suspicions.
4. Silva concluded with statement that Chilean media coverage of
story might provoke popular anger directed against USG and its instal-
lations here. Said that measures had been taken to assure adequate pro-
tection available for our buildings.
5. In reply, I made following points: (1) Could not testify to accu-
racy of quotation but I would regret any such imprudent statement by
U.S. official. (2) USG has no influence with wire services and does not
attempt exert any. Story is now a fact, in any case, and we have no
means influence how it is played here. (3) I felt safe in assuring GOC
without consulting Washington that there would be no further state-
ment of this type from any USG spokesman.
6. As for suspicions, I said that I simply could not believe this
was serious matter. Policy of USG friendship and support for Frei ad-
ministration and Chilean democracy too clearly established over long
years to allow responsible govt. officials entertain such notions. CIA is
part of USG, responsible to the President and my government assumes
responsibility for its actions.
1
Source: National Archives, RG 59, Central Files 196769, POL 239 CHILE. Confi-
dential; Priority; Exdis.
2
Dated October 22, telegram178765 transmitted the paragraph from the October 22
Washington Post article that contained the statement of the CIA spokesman. (Ibid.) See
footnote 2, Document 21.
378-376/428-S/80023
JanuaryDecember 1969 57
7. Silva said that he was entirely serious, reiterating that remarks
were official. I said in that case I could only express deepest personal
disappointment, an attitude I was sure Department would share.
8. Silva hastened to say that he did not mean suggest there were
any doubts whatsoever in GOC about friendly, cooperative policy of
USGa policy for which Frei and Christian Democrats most grateful.
However, past experienceswhich he refused elucidateindicated
that there not always full coordination of actions USG agencies and
thus suspicions not illogical.
9. I rejected his explanation, and said I still found such suspi-
cions unimaginable. There is only one USG policy and all agencies
follow it. We would not be surprised find this sort of thing among the
hostile and uninformed, but the GOC is another matter. I ended by
saying that what he had said went down badly with me, as it surely
would in Washington.
10. Silva told me that Ministry had not and would not inform
Chilean Embassy in Washington of this matter. I replied merely that I
would, of course, report conversation in full to Department. (My own
strong preference, however, would be to keep Santa Maria and friends
in the dark.)
11. Comment: This rather nasty business reflects nervousness and
intemperance with which GOC has treated various aspects of its cur-
rent troubles. I am still uninclined treat suspicions seriously, except
as indication of considerably less than friendly attitude toward USG in
some circles of GOC.
12. At same time, I have to say that we made this particular trouble
for ourselves. CIA spokesmans remarks were injudicious, inane and
completely uncalled for. We have pointed out that up to this time no
one has attempted connect Embassy or USG with General Viauxs ad-
venturea unique experience for me. But now, that old familiar scape-
goat is again available.
Shlaudeman
378-376/428-S/80023
58 Foreign Relations, 19691976, Volume XXI
23. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, November 20, 1969, 2005Z.
4870. Subj: CIA and the Golpe. Ref: Santiago 4449 and 4488.
2
1. Fon Min Valdes called me in today for what was virtual re-run of
my sessions with Silva last month (reftels). Said he was speaking for
President Frei and on his instructions.
2. According Valdes, Frei increasingly concerned by large volume
of reports from reliable sources re CIA involvement in golpe plotting.
Sources allegedly include unspecified Embassies of friendly coun-
tries. (Perhaps as result look I gave him at that point Valdes hastened
to say he was not repeat not referring to Soviets.) Understandably, CIA
must be diligent in keeping USG informed and many of these reports
probably arise from those efforts. Nevertheless, enough information is
at hand to give impression that CIA could be involved in promoting
a coup.
3. Valdes elaborated in his usual devious manner by quoting un-
named persons as believing that USG has decided on military solution
because of Alessandris age and unacceptability either Tomic or any
candidate of the left. Said such people saw golpe instigators as being
of two types: Socialists who are stirring up lower military ranks and ex-
treme rightists working at higher levels. Both can be handled, but
danger comes from foreign instigationpresumably of latter.
4. Valdes went on to note that GOC keeping a sharp eye on which
Chileans are visiting Washington these days. Said that while he had
heard of absolutely nothing improper re our reception of these trav-
elers, comings and goings of certain types had added to impression
that something was afoot. In this context, Fon Min referred to meetings
of Senators and Deputies last night in which grave concern expressed
re CIA, Washington visitors, Rockefeller recommendations on security
matters
3
and the like.
1
Source: National Archives, RG 59, Central Files 196769, POL 239 CHILE. Confi-
dential; Immediate; Exdis.
2
Telegram 4449 from Santiago, October 23, is Document 22. Telegram 4448 from
Santiago, October 24, incorrectly identified as 4488, is in the National Archives, RG 59,
Central Files 196769, POL 239 CHILE.
3
The report of the Rockefeller Mission to Latin America is in the Department of
State Bulletin, December 8, 1969, pp. 495540. The section on hemisphere security is on
pp. 515518. A summary of the Rockefeller report recommendations is in Foreign Rela-
tions, 19691976, vol. E10, Documents on American Republics, 19691972, Document 18.
378-376/428-S/80023
JanuaryDecember 1969 59
5. In response, I reminded Valdes of my two lengthy interviews
with Silva and of Ambassadors letter to President Frei.
4
Said I was
going to repeat our previous response to these incredible charges, and
did so point by point (reftels). Emphasized that I took full responsi-
bility in Ambassadors absence for all USG personnel in this country
and if GOC had any specific persons or actions in mind they should let
me know.
6. Re efforts keep ourselves informedwhich I conceded is exactly
our intentionsaid we know who are spreading these unfounded CIA
rumors that individuals involved are by no means all Communists, and
that some, motivated by intense anti-Americanism, are well-placed. I
also dwelt at some length on irrationality of thesis that USG desires
military solution here or anywhere in Latin America.
7. Valdes did not offer usual protestations of faith in USG policy
but agreed that what I said made sense. He declined present any spe-
cific charges and said he wanted avoid scandal which would come
with request for expulsion of any particular individual. Concluded
with request purportedly from President Frei, that I restrain those in-
volved in this matter.
8. I reiterated my acceptance of responsibility for our peoples ac-
tions, past, present or future. Told him he had my categoric assurance
that there was simply nothing to these accusations. Warned him this
would go down badly in Washington, as it did with me. Re Wash-
ington travelers bit, said that as old Dominican hand I knew that game
backward and forward. Recounted story of one Lajara Burgos who re-
turned from such a trip to announce to Santo Domingo press that he
had blessings of Pentagon and State Department as prospective PRD
Presidential candidate.
9. Valdes and I concluded this latest round on polite but somewhat
less than cordial terms. Fon Ministry Director General Pablo Valdes,
who is both a lackey and a cipher, sat in on meeting. His only contribu-
tion was a sad and baleful countenance.
10. Comment: One of principal culprits in spreading CIA stories is
Fon Ministry Political Advisor Eduardo Palma. I had him in mind in
making Valdes aware that we have identified tale-bearers. Also had
Valdes himself in mind when I remarked on irrationality of theory re
USGs new pro-military policya theory Valdes has reportedly been
vigorously propagating.
11. We have had numerous reports last few days of buzzing in
PDC circles about CIA and golpe. In part this reflects familiar tendency
to externalize problemsto seek scapegoat for difficulties of gov-
4
Not found.
378-376/428-S/80023
60 Foreign Relations, 19691976, Volume XXI
ernments own making. Also demonstrates Partys well-known suscep-
tibility to Communist ploys. Finally, Party and government are feeling
unloved, especially by USG. This is ridiculous in view of insistence on
Chilean independence but Department will understand character-
istic ambivalence involved.
12. We know of no specific activities on our part here which could
be interpreted in any rational fashion as involvement in coup plotting. I
have asked appropriate elements of our Mission to pursue information
on military situation with due discretion but vigorously, and do not be-
lieve we should change that course of action. Real golpe, which I do not
expect at least in immediate future, would be very much against our in-
terests here. We should be in position to use whatever influence we
have to counter such a threat.
13. I recommend that I be instructed to go back hard at Valdes
with frank message that USG finds these continuing accusations
intolerable.
5
Shlaudeman
5
Shlaudeman received instructions to renew Korrys earlier assurances that the
United States played no role in Chilean military unrest. (Telegram 196050 to Santiago,
November 21; National Archives, RG 59, Central Files 196769, POL 239 CHILE) Korry
and Meyer also informed Shlaudeman that the Department endorses your vigorous re-
buttal of Valdess accusation of CIA involvement in recent events. Ministers renewal of
charges already denied by President himself has caused us much anguish. It would seem,
however, both prudent and responsive to our real needs to cut far back on information
gathering activities by both CIA and DAO for the time being. (Telegram 196120 to San-
tiago, November 21; ibid.) Shlaudeman delivered the message on November 28, at which
point Valdes replied that the Chilean Government wanted to deflate the entire issue. (Tel-
egram 4968 from Santiago, November 28; ibid.)
378-376/428-S/80023
JanuaryDecember 1969 61
24. Telegram From the Embassy in Chile to the Embassy in
Venezuela
1
Santiago, November 24, 1969, 1531Z.
4905. Subj: Military Unrest in Chile. Ref: Caracas 5744.
2
1. President Frei declared state of emergency in Santiago Province
Nov. 19 during period of considerable tension brought on by rumors of
impending military action against GOC. Rumors were occasioned in
large part by open discontent in Armed Forces over long-festering
problem of low military pay scale. State of emergency seems designed
principally to permit GOC pressure news media and thus inhibit
spread of alarming stories.
2. Also on Nov. 19, GOC announced new military pay schedule
with generous increases at all levels. Our best info is that Armed Forces
are satisfied at least for time being. Ex-General Roberto Viaux, leader of
Oct. 21 Tacna regiment sit-in and self-appointed spokesman for the
discontented, has continued stir things up through gratuitous com-
ments to press on method of financing pay raise and other issues. Nev-
ertheless his consistent denial of golpe intentions should be noted.
3. Civilian support for military solution appears confined to a
few fringe elements such as extremist faction of Socialist Party and in-
veterate rightist plotters. More importantly, military have so far con-
centrated exclusively on institutional grievancespay, equipment and
make-up of high commandand have yet to demonstrate any concern
for broader political issues. Although a few officers may harbor polit-
ical ambitions, there is not hard evidence to date of a concerted move-
ment in Armed Forces to overthrow GOC.
1
Source: National Archives, RG 59, Central Files 196769, POL 239 CHILE. Confi-
dential; Immediate. Repeated priority to the Department, USCINCSO, and DIA. Rumors
concerning plans for coups continued to surface through the end of the year and were re-
ported in CIA Intelligence Information Cables TDCS DB315/0488169, November 18;
TDCS 314/1627269, November 21; TDCS 314/1719869, December 11; and TDCS 314/
1735869, December 14; all are ibid., Nixon Presidential Materials, NSC Files, Box 773,
Country Files, Latin America, Chile, Vol. I.
2
In telegram 5744 from Caracas, November 22, the Embassy reported the strong
concern expressed by the Government of Venezuela regarding Chile. Venezuelan Presi-
dent Rafael Caldera informed the Embassy that his government was preoccupied by the
Chilean crisis and the danger that forces, both of the left and of the extreme right, may be
stimulating a coup in Chile. Caldera continued, a coup in Chile, in the GOVs view
would be most serious (de suma gravedad) because of Chiles strong democratic tradi-
tion, and would have unforeseen consequences (repercusiones imprevisibles) in Latin
America. The Embassy commented that the Caldera government is fearful that shock
waves resulting from a Chilean coup would weaken faith in and support for the demo-
cratic system in Venezuela. The GOV, we believe, also would be similarly apprehensive
about the effect of a Chilean coup on neighboring Colombia. (Ibid., RG 59, Central Files
196769, POL 239 CHILE)
378-376/428-S/80023
62 Foreign Relations, 19691976, Volume XXI
4. Tensions have abated markedly since Nov. 19 and we do not be-
lieve GOC is in any immediate danger. At same time, malaise among
military is likely persist as long more fundamental problems remain
unsolved. These relate to the institutional mission of the Armed Forces
and to their place and role in a rapidly changing Chilean society. Key
figures in GOC, including new civilian Min Def Sergio Ossa, seem to
understand nature of such problems and to be looking for solution.
5. In discussion foregoing with GOV, you will wish bear in mind
that some in GOC evidence doubts re true attitude of USG. Defamatory
campaign of rumors and public speculation re CIA involvement in
golpe plotting coupled with distorted reporting of Rockefeller recom-
mendations have clearly had their effect in these quarters. Subject De-
partments concurrence, I would recommend that you emphasize to
GOV our unaltered support for Chilean democracy and our rejection of
notion that military solution here would be anything but harmful to
interests of USG and its hemisphere partners.
Shlaudeman
378-376/428-S/80023
A Spoiling Operation:
The 1970 Chilean Presidential Election,
January 1September 4, 1970
25. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, January 2, 1970, 2025Z.
10. Subj: When Klatch Means Country. (Part I of Two Parts).
1. Summary: If the US is as much an idea as a community then Chile
is as much a klatch as a country. I return to this first impression of 27
months ago to reaffirm my convictions that Chile is one of the calmer
and more decent places on Earth, that its democracy, like our own, has
an extraordinary resilence and that the high decibel count of Santiago is
mostly the sound of open safety valves and not the hiss of suppressed
furies. This new year will be noisier than ever; those who feast on con-
spiratorial crumbs will have rich fare for the next nine months before a
new President is elected. For my part, I see little that will endanger US
real interests in the country, in the area or in the hemisphere. Rather, as
a result of the unburdening of the historical hand-me-down (the copper
ownership issue) that placed our relations with Chile in permanent im-
balance, I foresee gradually improving opportunities for both countries
to arrive at a healthier relationship consonant with President Nixons
partnership policy and Chiles search for self-sustaining independence.
End summary.
2. On Christmas night, the Marxist-dominated TV Channel 9 of-
fered General Viaux as its journalistic scoop of the year. The central
figure of the October 21 military uprising here responded to more
than a dozen respectfully-worded questions from practically all of
Chiles top politicians (among them the Marxists Allende, Teitelboim,
Baltra and Tarud, the POCs Tomic and Fuentealba and the Nacion-
alies Jarpa) which were read by one of Castros most active supporters
in Santiago. To put this event in American terms, one would have to
imagine General MacArthur shortly after his removal from active duty
appearing on Peking radio to answer questions from our leading poli-
ticos read by Stokely Carmichael. That Viaux spent the best part of an
hour repeating with all the spontaneity of a pneumatic drill his dis-
1
Source: National Archives, RG 59, Central Files 197073, POL CHILE. Confiden-
tial. Repeated to Asuncion, Bogota, Buenos Aires, Caracas, La Paz, Lima, Guatemala City,
Managua, Mexico City, Montevideo, Panama City, Quito, Rio de Janeiro, Santo Domingo,
Tegucigalpa, and San Jose.
63
378-376/428-S/80023
64 Foreign Relations, 19691976, Volume XXI
claimers of any political ambitions is less relevant to an understanding
of Chile than that this TV happening took place.
3. Similarly on Christmas day, the most serious and widely read of
all newspapers in Chile, El Mercurio, published a two-column front-
page top-head as the days biggest news an inviting story on how to
emigrate to Australia. The article blurbed the local Australian Em-
bassys efforts to promote an exodus and noted rather sadly that the
Chilean colony down under numbered only one thousand. It added
cheerfully that business was definitely picking up. Other Latin lands
would surely condemn such journalism as treasonable; Anglo-Saxons
might view an equivalent article in the Times as a put on. In Chile it was
recognized as El Mercurios manner of making a political argument.
4. For the past week the parties of the Left have been staging a mar-
athon debate on who should carry their popular front standard in the
elections of next September. No literate Chilean could possibly
swallow Marxist proposition that such unity exists or that the pro-
gram adopted earlier by the parties was more important than the can-
didate chosen to carry it out. But the masquerade is played out as if
there were a genuine hold-your-breath public interest in the chances of
each of the five declared runners. Hardly anyone in the media says the
obviousthat the Communists Neruda is anxious to return to his
poems and his peregrinations in dollar lands, that Tarud is a soul with
slick hair and that the Radicals Baltra, despite his front-running po-
sition, was left at the gate. The play is the thing and the players take
their roles so earnestly that the charade becomes captivating to them.
5. So it was too with the military effervescence of October. No coup
in South America could be carried out in the farcical manner of General
Viaux. The people of Santiago rightly remained on the sidelines, not be-
cause they have little commitment to their democracy, but because they
have had too much experience with how political affairs are conducted
here. Drama, sensation and noise are the essential elements; violence,
turmoil and repression are extraneous. That is why Chileans take
rumors of earthquakes seriously; what is truly threatening is not pre-
dictable, it not acted out in the open, is not an extension of the coffee-
house klatch.
6. These observations are not intended to be read as indifference to
what most successful Communist Party in the hemisphere is seeking to
accomplish nor to where an aimless military may go nor to how democ-
racy can be sapped by egocentric posturings of politicians. Nor are they
designed to present a rosier-than-reality view of Chile and its gov-
ernment. I would only seek to restore balance to a perspective whose
headliner hues are more superficial than real. (End Part I)
Korry
378-376/428-S/80023
January 1September 4, 1970 65
26. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, January 7, 1970, 1758Z.
54. Subj: When Klatch Means Country. (Part II of Two Parts). Ref:
Santiago 10.
2
7. With the announcement that the arthritic Alessandri will leave
next week for his one and only campaign trip to the south (he has such
a phobia about feeling cold that it is now or never), the campaign for
the Presidency has begun in earnest. Of course, the Leftist unity bedlam
has not been stilled but by the end of the week there should be a suffi-
cient residue of cohesion to fashion a candidate. The Communists will
accept anyone agreeable to the Socialists since their first preoccupation
is not to be outflanked from the Left. As for Tomic, he has restored a
larynx that could only produce a croak on Christmas Day (when he
telephoned before going on a brief recuperative leave) after 180
speaking engagements in 60 days.
8. Thus, we can now look forward, the military willing, to nine
months of interminable babble, time enough for the full venting of pas-
sions and of programs, of cudgels and of cure-all, and of pasts and
presents enfolded in the tenses of the future. To seek to distinguish the
apparent from the real in this ambiente is to prove Orwells dictum that
all political writing is indefensible. With that injunction in mind, here is
one observers assessment.
9. There is no longer in Chile any national issue of over-riding im-
port except for the perennial one of inflation. The country has a degree
of independence today that it has not enjoyed for many decades. This
comparative freedom has been largely the result of the two most im-
portant accomplishments of the Frei regime and partly good luck.
What Frei has achieved is a transfer of income and of effort which has
provided an outlet for the discontents and frustrations that are alien-
ating so many in Latin America. The dollar and cents transfer of income
to the wage sector combined with the social transfer of very extensive
educational, agrarian and other popular reforms stole the growing
thunder from the Left. The second major achievement was the two-step
process of copper Chileanization by which large amounts of capital for
expansion were first attracted and then ownership was gradually taken
1
Source: National Archives, RG 59, Central Files 197073, POL CHILE. Confiden-
tial. Repeated to Asuncion, Bogota, Buenos Aires, Caracas, La Paz, Lima, Guatemala City,
Managua, Mexico City, Montevideo, Panama City, Quito, Rio de Janeiro, Santo Domingo,
Tegucigalpa, and San Jose. Part I of the telegram is Document 25.
2
Document 25.
378-376/428-S/80023
66 Foreign Relations, 19691976, Volume XXI
over. The good luck that permitted this change to be relatively painless
was the very high price of copper that has prevailed for three years; the
bonanza enabled the U.S. companies to have returns on investment far
in excess of their original calculations and permitted Chile to buy them
out with less effort than anticipated.
10. Frei may well have matched these two attainments with a third
advance in the first week of the year. Passage by Congress of the Con-
stitutional Reform Bill after five years of debate will give the next Presi-
dent of Chile an opportunity to deal with inflation and other economic
matters with muscle and presumably with effect. It is to Freis and his
PDCs credit that although Alessandri is the current betting favorite to
be the next President that they kept their 1964 campaign pledge and
pushed through the kind of reform that Alessandri had also promised
as President but never managed to effect.
11. My visceral instincts and my cognitive assessments persuade
me for one that these three accomplishments of the Frei government are
sufficient to keep Chile more or less on center and compatible in form
and direction with our own system. Almost all else that could be said
about Chile is, to my mind, cud for the bureaucratic Talmudists who, as
I, must chew for survival.
12. The military falls into that category. Doubtless an unexpected
conjuncture of events (such as Freis abysmal handling of the Armys
problems in 1969) could impel the Armed Forces into some outrageous
if easy grab for power. But with the GOC committed to buying arms
and raising pay and with more opportunities for promotions, there is
no overriding impulse for the Army to move. There is no party like the
Peruvian APRA that concerns the military except the Communists and
there is no chance of a Communist President in Chile. There is no issue
like the IPC. There is no desire to deal with inflation and all the other
complex problems of modern government. And although Viaux and
his ambitious wife may harbor political ambitions, I doubt that the
Leftist parties would have indulged in their unseemly jostling the past
fortnight if they took the chances of a military coup or a Viaux very se-
riously at this time. Viaux in his TV appearance looked and sounded
like an Easter Island Moai. (So in the beginning did Barrientos whom
he resembles but Chile is not rpt not Bolivia and the Santiago citizenry
is sophisticated and knowledgeable about politics.)
13. Discussion about whether agrarian reform is efficient, whether
private enterprise will survive and whether Chiles growth rate is suffi-
ciently dynamic is of interest, but I submit that the process of develop-
ment is far more complex than the measurement of growth and that the
historical particularisms of each country are still so foreign to us that
such debate is usually more an indulgence in personal prejudice than
an exercise in useful analysis. The Frei govt has spent an uneconomic
378-376/428-S/80023
January 1September 4, 1970 67
amount of money for land redistribution in a political effort to prove
there is no loss of production and to gain mass sympathy. Similarly I
would guess that if agricultural production is therefore over-stated,
then industrial production is usually well under-stated. What is impor-
tant is whether enough is happening in a country to give it a sense of
forward movement yet not be so frenetic as to be bewildering. My
judgement is that Chile has managed a kind of equilibrium. That is why
the Chilean public opinion polls reveal that Chileans regard inflation as
the uniquely significant preoccupation, why they have little political
interest in all other problems and why they overwhelmingly favor a fu-
ture President who represents Chilean middle of the road stability.
14. Another Talmudic issue is whether Frei can take decisive ac-
tion. My answer would be more than his predecessor and less than a
Peron, a General Velasco or a General Ovando. Frei has kept within the
spirit of Chile and has taken those decisions (transfer of income,
copper, and constitutional reform) which are transcendental in impor-
tance to Chile. I feel that politically his nose has served him well but
that as the leader of a party he has permitted an extraordinary amount
of dissent and of divisiveness and that in dealing with strong personal-
ities such as the military, the Communists, or his own Gabriel Valdes,
he is inclined to temporize and to let events take their course. But who
ever ran a well disciplined coffee klatch?
Korry
27. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, January 16, 1970, 2055Z.
204. 1. Had long relaxed talk with President January 15 main pur-
pose of which was to cap an effort designed to make GOC and its party
(PDC) more responsive to US sensitivities about manner in which perti-
nent foreign policy issues are handled. There is some reason to hope
that confrontation tactics of FonMin Valdes will be toned down for a
while.
1
Source: National Archives, RG 59, Central Files 197073, POL CHILE. Confiden-
tial; Limdis.
378-376/428-S/80023
68 Foreign Relations, 19691976, Volume XXI
2. Frei believes that Alessandri will win elections, is convinced that
General Viaux is no longer a significant army or political factor, is de-
lighted at current disarray in Marxist camp, and is still distrustful of
Tomics grasp of Chilean situation but persuaded that he will do better
than most anticipate.
3. He is currently preoccupied by possible adverse consequences
of imminent liberalization of imports. Chileans will always buy im-
ported goods no matter how much more expensive than domestic
products if they have opportunity. President is obviously under strong
anti-liberalization pressures but believes it essential to make Chile
more efficient producer over longer run and to hold down inflation in
1970.
4. He agreed that while Viaux appears to be much diminished
factor, problem of Armed Forces by no means resolved. Frei said US
made enormous error when it ended military pact (US military aid)
and that definition of Armed Services role in society will be continuing
problem.
5. He supports President Nixons policies towards Latin America,
is very perceptive in his understanding of US worldwide policies and is
realistic in his expectations for Latin America and Chile.
6. In connection para 1 above, I do very much hope that Assistant
Secretary Meyer will consent to see Enrique Krauss in Washington Jan-
uary 28 or 29 (when I too will be in Washington) per what we un-
derstand to have been his written request last month to Meyer for
appointment.
Korry
378-376/428-S/80023
January 1September 4, 1970 69
28. Memorandum for the Record
1
Washington, January 19, 1970.
SUBJECT
Discussion of U.S. Government Activities Leading Up to the Chilean Election in
September 1970. Held at State Department on 19 January 1970
PRESENT
Mr. John H. Crimmins
Mr. Frederic L. Chapin
Ambassador Wymberley Coerr
Mr. James R. Gardner
Ambassador Edward M. Korry
Mr. William V. Broe
[Name not declassified]
[Name not declassified]
[Name not declassified]
1. Mr. Crimmins started the meeting by saying that the purpose of
getting together was to discuss the proposal to be made to the 303 Com-
mittee on U.S. Government activities in connection with the September
1970 election in Chile. He expressed his concern over the draft of the
paper for the 303 Committee which the agency had sent over to State in
December 1969. He described as his controlling concern the sensitiza-
tion in Chile to U.S. involvement following General Viaux dramatic
uprising at the Tacna regiment. This concern is intensified because of
the particular sensitivity in Chile now to the CIA; another particular
concern is the assumption in Chile that the U.S. would be pro-
Alessandri and that, if the U.S. intervened in any way in the election, it
would be to promote Alessandri. Mr. Crimmins went on to say that
from the beginning he and Secretary Meyer have questioned the need
for the U.S. to be involved in this election at all.
2. Ambassador Korry thought that Mr. Crimmins concerns were
natural and useful, for the proposals to the 303 Committee needed this
sort of examination and occasional review. Both the help to the Demo-
cratic Radical Party (PDR) and the propaganda work to be carried on
through Mr. [name not declassified] mechanism could be interpreted as
pro-Alessandri, which is bothersome, said Ambassador Korry. Ambas-
sador Korry went on to define the interest he sees for the U.S. in Chile:
1
Source: Central Intelligence Agency, Job 7901440A, File AA7, WH Division
1970. Secret. Drafted in DDP/WH on January 30. A March 19 memorandum of this
meeting, prepared from notes by James Gardner (INR), is in the Department of State,
Bureau of Intelligence and Research, INR/IL Historical Files, Documents on Chile to the
Department of Justice.
378-376/428-S/80023
70 Foreign Relations, 19691976, Volume XXI
are we going to have a popular front or Marxist government in Latin
America? Noting his own reluctance to engage in an operation that
might have the effect of being pro-Alessandri, Ambassador Korry nev-
ertheless felt that anything that serves to keep the left split is worth-
while. There was a discussion of how the help to the PDR would serve
to take votes away from Allende, the presumed sole candidate of the
left.
3. Mr. Crimmins defined the maximum objective of the U.S. as the
collapse of the popular front effort and the splitting of this group into
six different parties. Less than that would be the Socialist Party (PS) and
the Communist Party (PCCh) splitting off together and losing the sup-
port of the other four. Secondly, said Mr. Crimmins, the objective is to
have the appeal of the popular front lessened, if there is to be one. Am-
bassador Korry offered a third objective: that of isolating the PCCh. In
response to Mr. Crimmins question of the current judgment on the
voting, Ambassador Korry put their chances for winning as Alessandri,
first, Allende, second, and Tomic, third. Noting that this can change, he
thought that Alessandri would start with some 35% of the vote, Tomic
with some 25%, leaving some 30% then to Allende and the front. Mr.
Crimmins noted that this leaves some 10% undecided and Ambassador
Korry agreed that some 1015% of the vote is floating and crucial. Mr.
Broe said that this is what made the proposal to the 303 Committee
important.
2
4. Ambassador Coerr asked how Ambassador Korry would view
an Allende victory. Ambassador Korry and Mr. [name not declassified]
agreed that the Chilean military would accept this victory.
3
The victory,
Ambassador Korry continued, would weaken the Christian Democrats
(PDC) and there would be serious internal divisions in the new gov-
ernment because of traditional Socialist and Communist rivalry for
contact with the masses. A part of the PDC would then be attracted to
the PS and would support Allende against the Communists. Ambas-
sador Coerr commented that an Allende victory appears to be not the
same as a Communist victory, in that case. Ambassador Korry agreed
with this, but said that operationally one must treat an Allende victory
as the same thing. At least, thought Ambassador Korry, it would be
very imprudent to act as if an Allende government would be anything
but another Castro government: it might be worse. When they say they
2
The INR memorandum noted, The Ambassador then said that he did not expect
the left to win in any event, short of the death or disablement of Alessandri. (Ibid.)
3
The INR memorandum contains the following addition to this part of the discus-
sion: The Ambassador said that an Alessandri victory would be very, very bad. It could
easily produce a military government in reaction that would fall under left-wing influ-
ence. (Ibid.)
378-376/428-S/80023
January 1September 4, 1970 71
will preserve personal liberty, for example, he doubts it. At least the
press would be muzzled, he would predict.
5. Mr. Crimmins asked what difference it would make if we did
not become involved, seeing how sensitive our involvement may be
versus what we may gain from this involvement. Ambassador Korry
noted that we can easily do nothing but we may have to ask ourselves,
if Allende were to win, especially by a few votes, whether we might not
better have become involved.
4
Mr. Broe noted that if the CIA with-
draws from what little the U.S. is doing now politically in Chile, this in
itself would leave the impression that the U.S. Government is not inter-
ested in the fate of Chile. Mr. Crimmins suggested that this be ex-
plained to contacts in Chile as being on the basis of prudence rather
than of indifference. Mr. Crimmins attempted to sum up the discussion
at that point by saying that there is a chance that our efforts would in-
fluence a small but crucial margin of voters; that this operation can be
conducted with justified expectations of considerable security; and that
if we do not take this relatively secure opportunity to get this small
margin of votes, we are vulnerable to the charge that we are not taking
even marginal steps to prevent an Allende victory. Ambassador Korry
noted that our negative decisions on military assistance and on a pro-
gram loan have led to the belief in Chile that the U.S. is out of the pic-
ture and, while Chileans of all sectors welcome this disengagement by
the U.S. in their affairs, we are nevertheless left with only this action to
take: we are left with a minimal action to be taken to minimize the
minimal possibility.
6. There was considerable discussion of the security of the PDR ar-
rangements and of the propaganda mechanism. While it was agreed
that the PDR arrangements seem to be reasonably secure, and that the
same could be said of the propaganda mechanism, which was de-
scribed in some detail, concern was expressed by Mr. Crimmins and
others that a pro-Alessandri content of the propaganda might over-
shadow the anti-popular front motive. Recognizing this as a legitimate
concern, it was agreed that the product of this group must be moni-
tored. Mr. [name not declassified] said that the terms of the engagement
with this mechanism, which he himself directs through two key people,
4
The INR memorandum contains the following account of this segment of the con-
versation: Mr. Crimmins asked what would happen if we just sat on our hands. Ambas-
sador Korry replied that it perhaps would make a difference of only 1015 thousand
votes. As a matter of fact, he said, he did not believe that our major effort in the 1964 pres-
idential elections actually made a difference of over 1 percent in the popular returns. As
far as he was concerned, Ambassador Korry said, he would not be unhappy if we de-
cided to do nothing. But if we did do nothing, and Allende won, he did not know how we
could respond to the naturally ensuing inquiries about what we had done to prevent a
Communist victory in Chile. To this Mr. Crimmins responded that such concerns were
not really the best foundation for building policy. (Ibid.)
378-376/428-S/80023
72 Foreign Relations, 19691976, Volume XXI
are that the purpose is to maintain tension in the left camp, not to sup-
port Alessandri. Mr. [name not declassified] never threatened these
people with the withdrawal of support, for he feels this threat to be un-
necessary. It was agreed that our support would be withdrawn if a
pro-Alessandri tone develops and becomes crucial.
5
7. The specific proposals to the 303 Committee were then dis-
cussed as (a) support to a [less than 1 line not declassified], (b) support to a
PDR staff member, (c) support to the propaganda mechanism, (d) addi-
tional activity carried on from within the station [less than 1 line not de-
classified], such as the production of leaflets, a [less than 1 line not declas-
sified], and the production of posters. These last activities have been
going on for some time and will continue after the elections are over,
noted Mr. Broe. Ambassador Korry felt that the one-shot opportunity
approach should allow the embassy to make its decision to follow these
up without having to come back for permission every time, and this
was agreed to. Mr. Crimmins wanted the points concerning the agree-
ment to cut off support to the PDR and support to the propaganda
mechanism, if either becomes simply an Alessandri weapon, to be re-
flected in the 303 paper.
[name not declassified]
5
The INR memorandum contains the following version of this part of the discus-
sion: Mr. Crimmins then shifted the emphasis of the discussion slightly to ask at what
point would our operation become less of an anti-UP exercise and more of a
pro-Alessandri one. Ambassador Korry said that the operations would have to be care-
fully monitored to see that this would not happen. Such monitoring, Mr. [name not declas-
sified] said in response to Ambassador Korrys query, was quite possible. Ambassador
Korry joined in saying that if the newsletter, for example, became pro-Alessandri in its
tone, our financial help to it would cease immediately. Mr. Crimmins asked if he there-
fore could assume that the rules of engagement were such that if our instruments moved
into a pro-Alessandri attitude, our help would stop.
Mr. Gardner wanted to know why, if Allende would be bad for us and if Ales-
sandri in the long run would be almost as bad, why it was that we were not considering
assistance to Tomic. The Ambassador replied that in the first place Tomic did not want
our aid and that in the second place he was so far behind that no assistance we could give
would be in any way useful to him or our own objectives. (Ibid.)
378-376/428-S/80023
January 1September 4, 1970 73
29. Memorandum for the 40 Committee
1
Washington, March 5, 1970.
SUBJECT
Political Action Related to 1970 Chilean Presidential Election
1. Purpose of the Memorandum
A. This memorandum will bring the members of the Committee
up to date on the political developments which have taken place since
the March 1969 congressional election and recommend that the Com-
mittee endorse certain covert activities designed to reduce the possi-
bility of a victory by a Popular Unity (UP) candidate in the September
1970 presidential election. The UP is a coalition of Communists, So-
cialists and other leftists, and is similar to the Popular Action Front
(FRAP) which supported leftist coalition candidates in past elections.
This memorandum also discusses the leading presidential candidates,
the major campaign issues and the political climate. The recommended
covert activities involve support [less than 1 line not declassified] in
the Democratic Radical Party (PDR) and the use of a propaganda
mechanism.
B. The most reliable political surveys indicate that the presidential
contest will be a close race with an estimated 1015% of the vote still
undecided or floating, and, therefore, crucial. The Embassy in Santiago,
the Department of State and the CIA have agreed that the election of
the UP candidate would be detrimental to the U.S. and that spoiling op-
erations should be undertaken to influence a portion of the uncom-
mitted vote away from the UP. It has also been agreed that the U.S.
Government should not support either of the other two presidential
candidates in the sensitive political environment currently found in
Chile, since there is little to choose between them.
2. Political Developments and Candidates
A. The months following the March 1969 election have been
marked by intense political activity. The six parties which currently
make up the UP agreed to nominate the Socialist Senator Salvador Al-
lende in January 1970 after a bitter and prolonged struggle involving
intense ideological and personality differences. The other two an-
nounced candidates are Jorge Alessandri, an independent, and Rado-
1
Source: National Security Council, Intelligence Files, Subject Files, Chile, 1970. Se-
cret; Eyes Only. Anotation in an unknown hand at the bottom of the first page reads, On
25 March 1970 the 40 Committee approved this proposal as stated, including the funding
level.
378-376/428-S/80023
74 Foreign Relations, 19691976, Volume XXI
miro Tomic, the former Ambassador to the U.S. who bears the Chris-
tian Democratic Party (PDC) standard.
(1) Tomics attempts to form a coalition of leftists in support of his
candidacy not only were rebuffed by the Communist Party of Chile
(PCCh) but also succeeded in alienating the political right. He is run-
ning on a progressive platform, basing his campaign appeal on the con-
tinuation and intensification of the revolution in liberty theme begun
by President Frei in 1964. Although the PDC won 30% of the popular
vote in March 1969, Tomic cannot count on this percentage and recent
polls indicate that he is presently running third. The PDC also has been
weakened since March 1969 by the defection of some of its best-known
revolutionary figures who left the party to form the opposition United
Popular Action Movement (MAPU) in mid-1969. The MAPU since has
allied with the PCCh and the Socialist Party of Chile (PS) in a series of
university elections and is now counted upon in the UP camp.
(2) The Radical Party (PR), whose leadership led it into the UP, at
first fought to have its own candidate, Senator Alberto Baltra, chosen as
the leftist unity candidate. The PCCh (and later the UP) rejection of
Baltra was a blow to the PR, which in March 1969 held 13% of the vote.
In addition, the PR was weakened by the expulsion of its more mod-
erate members who formed the Democratic Radical Party (PDR) after
the July 1969 PR party convention.
(3) The National Party, which attracted 20% of the March vote, is
supporting former President Jorge Alessandri. Current voting surveys
indicate that Alessandri, whose support crosses party lines, is the early
leader in the presidential race. Ambassador Edward M. Korry believes,
however, that Alessandris strength may be at its peak and will weaken
before election day.
(4) The Communists and Socialists had difficulty in forming an
electoral alliance similar to the FRAP. They disagreed on which polit-
ical parties should be included in the front and on the election issues.
The PCCh, for example, wanted a broad alliance (including elements
which the Socialists viewed as bourgeois) and it objected to Socialist en-
couragement of violence and support to ultra-revolutionary groups.
The selection of Senator Allende came after five months of political bar-
gaining, and the intense bitterness which became increasingly evident
during the writing of the UP platform will linger on. At the same time,
the PCCh, which is one of the best-organized and most pro-Soviet
Communist parties in the hemisphere, was successful in forging a
broad-based electoral machine which it will support with its experi-
enced campaign organization. If the UP partners retain the votes they
polled in March 1969, their September 1970 aggregate will amount to
approximately 40% of the total popular vote. The split within the PR
will, however, reduce its contribution to the Allende campaign.
378-376/428-S/80023
January 1September 4, 1970 75
B. On 21 October 1969 a recently-retired Chilean general led a lim-
ited military protest designed to exploit the Armys discontent over the
failure of its high command to respond to requests for higher pay and
more modern military equipment.
2
Although the protest was short-
lived and confined to two Santiago regiments, the fact that it occurred
at all is significant because of the militarys traditionally apolitical be-
havior and its support of the constitution. The Frei Government ac-
ceded to many demands by the disgruntled officers, including the
granting of a wage increase which it was ill-equipped to finance. Mili-
tary pay raises have sparked similar demands by other public sector
employees thereby adding to the already serious inflation.
Another serious consequence of the military unrest, and the han-
dling of it by the Frei administration, was a public charge that the U.S.
Government was involved in the protests origins. Although the
Chilean Government eventually stopped its participation in the anti-
U.S. campaign, other voices in the Chilean Congress and the press con-
tinued, for a time, in their attacks. The end result was that Chile was
made unusually sensitive to the presence of the U.S. Government and
CIA.
3. Campaign Issues
The issues at stake during this presidential campaign center
around Chiles economic problemschronic inflation, housing short-
ages and unemployment. The need for agrarian reform is treated as a
vital problem as is the general concern over the rising tide of violence.
Now aware that the traditional apolitical stance of the military can no
longer be taken for granted, the candidates are under mounting pres-
sure to be more responsive to the increasing social, economic and polit-
ical demands of the electorate.
4. Covert Activities
On 19 January 1970 representatives of State and CIA, including
Deputy Assistant Secretary of State John H. Crimmins, Ambassador
Wymberley Coerr and Ambassador Korry, met to discuss the current
political situation in Chile and the covert action operations which were
being conducted or proposed to reduce the chance of a UP victory.
3
A. One covert activity involves the continued and expanded use of
the propaganda mechanism established during the March congres-
sional election period. The mechanisms effectiveness and security
were tested during the March election operation when it performed the
dual role of providing propaganda support [1 line not declassified], and
disseminating anti-Marxist propaganda via press, poster and radio
outlets.
2
See Document 20.
3
See Document 28.
378-376/428-S/80023
76 Foreign Relations, 19691976, Volume XXI
(1) The propaganda mechanism was created [5 lines not declassi-
fied]. The security of the mechanism, plus its proven talents in the prop-
aganda field, permit the mounting of an anti-UP campaign on a coun-
trywide basis in which the U.S. hand will not show. In addition to
producing posters, radio and newspaper ads, and leaflets directed
against the UP, a [less than 1 line not declassified] will be mailed to [less
than 1 line not declassified]. The [less than 1 line not declassified] will
discuss and reveal the tactics and strategy of Communism and popular
fronts, and will suggest courses of action for those interested in coun-
tering UP election efforts.
(2) [less than 1 line not declassified] the propaganda mechanism may
attempt to use it to further the candidacy of Alessandri. With this possi-
bility in mind it has been made clear [less than 1 line not declassified] that
our interest in the mechanism is solely to draw votes away from the UP
and to divide the coalition. Although a conflict of interest is not ex-
pected to arise, the propaganda will be monitored closely and should
the tone or content become pro-Alessandri rather than anti-UP, our
support will cease.
B. The second covert activity supports the PDR in its efforts to re-
duce the number of votes which the Radical Party can deliver to the UP.
(1) Historically the Radical Party has been an important party in
Chilean politics. From 19381952 it ruled essentially alone by out-
maneuvering its Marxist allies. From 19521964 it remained the largest
single political party but suffered defeats in the congressional elections
of 1965 and 1969, and in the latter case fell to fourth place in voter popu-
larity. Its opportunistic leaders now view alliance with the UP as the
only avenue to regain a measure of power. Although the PR currently
represents only about 13% of the vote, it could play a decisive part in a
close presidential race and it is therefore necessary to work against the
present leaders thereby reducing the number of votes they can deliver
to Allende.
(2) The Special Group first authorized covert contacts with [less
than 1 line not declassified] the PR in 1962 when approval was given to
assist moderate Radicals in their efforts to gain influence within the
party. In December 1963, the Special Group approved financial support
to [3 lines not declassified]. On 28 April 1967, the 303 Committee ap-
proved [less than 1 line not declassified] to assist moderate Radicals in
their contest with pro-FRAP leaders for control of the June 1967 party
convention.
4
Failing that, the moderates were encouraged to gain suf-
4
For the text of the initial proposal, see Foreign Relations, 19641968, vol. XXXI,
South and Central America; Mexico, Document 294.
378-376/428-S/80023
January 1September 4, 1970 77
ficient strength to restrict the policy control then being exercised by
Marxist-oriented PR leaders. The PR moderates failed to gain sufficient
control and the party moved closer to an alliance with the Communists
and Socialists. This trend was confirmed during the July 1969 conven-
tion when dissident moderates were purged from the PR hierarchy.
The dissidents then organized the PDR in opposition to the parent
party and its proposed alliance with the PCCh and the Socialists.
(3) With the approval of Ambassador Korry, we continued to work
with dissident PR leaders to establish the PDR as a political base. As-
sistance during the JulyDecember 1969 period amounted to approxi-
mately [4 lines not declassified]. The PDR acquired 14,000 signatures and
was registered as a legal party in December 1969.
(4) Ambassador Korry has agreed to two recent proposals to assist
the PDR in its efforts to undercut PR and UP strength. The first involves
[6 lines not declassified].
(5) Our interest in the PDR is in its ability to reduce the electoral
support which the PR can deliver to Allende. This spoiling operation
will be monitored closely by the Ambassador and the CIA Station in
Chile and will be discontinued should it become more of a vehicle for
promoting Alessandris candidacy than an anti-UP weapon.
C. There are other existing political action capabilities available to
the CIA Station which are being used to attack and weaken the UP.
[6 lines not declassified]
5. Recommendations
A. There is a State/CIA consensus that the 1970 presidential elec-
tion will be a close race in which no candidate is likely to win an abso-
lute majority. No U.S. Government support is planned for Tomic or Al-
essandri. Tomic is now running a distant third and it is unlikely that
external support could swing a sufficiently large number of votes to
make him a serious contender. Even if this were a possibility, Tomics
views on economic and political matters would indicate that a gov-
ernment led by him would be apt to take some actions not consonant
with U.S. interests. Alessandris advanced age (he is now 73 years old),
and the undistinguished record of his 19581964 administration, are
factors which argue against support of his candidacy. In addition, the
present political climate in Chile is very sensitive to the presence of the
U.S. and the CIA, and it is not conducive to the mounting of a large-
scale election operation.
B. The UP candidate, Allende, running as the standard-bearer of a
broad leftist coalition and benefiting from the extensive organization
talents of the strong PCCh, is a formidable contender; he is presently
running second, according to an October 1969 public opinion survey.
Intelligence indicates that the Chilean military would probably not pre-
vent him from assuming office. Based on Allendes own views plus the
378-376/428-S/80023
78 Foreign Relations, 19691976, Volume XXI
public platform of the UP, we must assume that an Allende victory
would mean the emergence of a Castro-type government in Chile.
C. Since the race is expected to be close, in which 1015% of the
vote is floating and crucial, there is a reasonable chance that the
spoiling operations, involving the PDR and the propaganda mecha-
nism, could influence a small but critical number of votes away from
the UP. It is therefore considered advisable to attack and attempt to di-
vide the UP by means of these two spoiling operations. There is also the
justified expectation that these operations will be conducted without
the U.S. hand showing.
D. The estimated costs of these two activities through September
1970 are: (1) [dollar amount not declassified] for assistance to the PDR and
(2) [dollar amount not declassified] for the propaganda mechanism. It is
recommended that the 40 Committee endorse these activities at the
funding level mentioned above. Funds are available within the Agency.
30. Memorandum by Viron P. Vaky of the National Security
Council Staff
1
Washington, March 25, 1970.
I have the following comments on Chile:
1. The plan proposed
2
is designed in part upon a given estimate of
how the three candidates will performAlessandri first, but declining;
Allende strong second and possibly rising; and Tomic a distant third. I
believe, however, that this estimate is dated. According to latest reports
Tomic is rising, and the prospect is that all three will be bunched to-
gether in an almost dead heat. This suggests possibly different options.
It also suggests that the readings ought to be reviewed frequently be-
tween now and September to determine if shifts in our support are
indicated.
2. If Allende is the threat the paper posits, should we not do more
than we propose to insure his defeat?
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only. Although the memorandum bears no addressee, it was most
likely written for Kissinger in preparation for the 40 Committee meeting scheduled for
March 25.
2
See Document 29.
378-376/428-S/80023
January 1September 4, 1970 79
3. The present tactic is to reduce Radical votes for Allende. Pre-
sumably, these will shift to Alessandri, but if they divide between Ales-
sandri and Tomic, all we may be doing is insuring a three-way split.
4. Why would not a complementary tactic be to strengthen Tomics
appeal? He has to contend with Allende for the same sector of votes. By
dividing the left vote between them, there is a good chance of in-
creasing Alessandris percentage.
5. If we have in the past sought to strengthen the moderates in the
Radical Party, should we not think of strengthening the moderates in
the Christian Democratic Party? Would it not be good insurance? A
moderate left-wing alliance may be needed to confront Allende.
6. The paper posits merely spoiling Allendes chances, but refuses
to formulate a plan to support an alternative. It points out that we could
live with either, and that either has problems which may not merit our
support (page 13). But is this wise? If Alessandri wins at 73 and Allende
shows up strong, might we not have a difficult situation for the long
haul. This might polarize the society by offering strong political forces
at the extremes and destroy the relatively moderate left force that
might contend with the Communists/Socialists for leadership of the
political left.
Viron P. Vaky
3
3
Printed from a copy that bears this typed signature.
378-376/428-S/80023
80 Foreign Relations, 19691976, Volume XXI
31. Memorandum for the Record
1
Washington, March 25, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee 25 March 1970
PRESENT
Mr. Kissinger, Mr. Packard, Mr. Johnson, and General Cushman.
Mr. Mitchell was out of the city; his views on the agenda items were obtained
prior to his departure.
Mr. William Broe was present for Items 1 and 2.
Mr. Archibald Roosevelt was present for Item 3.
Mr. [name not declassified] was present for Item 4.
Mr. Wymberley Coerr was present for Items 1 through 4.
Mr. Thomas Karamessines was present for Items 1 through 5.
1. ChilePolitical Action Related to 1970 Presidential Election
a. Mr. Broe briefed the Committee in detail on the close three-way
presidential election race in Chile between Alessandri, Allende, and
Tomic. He noted that the joint State/CIA consensus is that the U.S.
should not provide direct support to any presidential candidate.
Rather, the covert effort should be confined to spoiling operations un-
dertaken against the Popular Unity (UP) electoral front, a coalition of
Communists, Socialists and leftists supporting Allende. Mr. Broe de-
scribed the operations, mechanisms and secure funding methods to be
used and noted that total estimated costs of these efforts through Sep-
tember 1970 would be $125,000.
b. In the ensuing discussion, cognizance was taken of the fact that
following an electoral poll to be conducted in Chile in April, the Am-
bassador and the CIA Station Chief might recommend additional ac-
tion, possibly even including direct support to one candidate.
c. The members were unanimous in approving the proposal as de-
scribed in the CIA paper dated 5 March 1970,
2
including the funding
level.
[Omitted here is discussion unrelated to Chile.]
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only. Drafted by Chapin on March 30. Copies were sent to Mitchell,
Packard, Johnson, and Helms.
2
Document 29.
378-376/428-S/80023
January 1September 4, 1970 81
32. Memorandum of Conversation
1
Washington, April 10, 1970.
SUBJECT
Anaconda Requests U.S. Government Financial Assistance for the Alessandri
Election Campaign
PARTICIPANTS
Mr. Charles A. Meyer, Assistant Secretary, ARA
Mr. Jay Parkinson, Anaconda
Mr. Jose de Cubas, Westinghouse
Mr. Enno Hobbing, Council for Latin America
Mr. William P. Stedman, Jr., Director, ARA/APA
Mr. de Cubas, President of the Council for Latin America (CLA),
indicated that he and Parkinson had requested the appointment with
Mr. Meyer to discuss their concern about the presidential election cam-
paign in Chile. Mr. de Cubas indicated that since his company had no
detailed information about Chilean developments, the presentation
would be made by Mr. Parkinson. Mr. de Cubas said that Mr. Par-
kinsons views on U.S. participation in the Chilean election had not
been discussed with any other company executives in the CLA and that
CLA did not have a policy on member companies participation in
elections.
Mr. Parkinson stated that although present information shows that
Alessandri is ahead in the Chilean presidential election, Tomich and
Allen de are waging very active campaigns. He indicated that Ales-
sandri has very little financial backing and that his opponents are both
very well supported; Tomich receiving funds indirectly from Govern-
ment of Chile operations and Allen de receiving funds from Commu-
nist sources outside of Chile.
He indicated that Alessandri has designated one specific indi-
vidual as his intermediary to receive funds from private foreign com-
panies for his campaign, and he has made a request to Anaconda for
help.
Parkinson said that Anaconda will contribute, as it has before, and
that he believes other U.S. companies will also participate. He said that
unfortunately there is extremely little money in Chile for Alessandris
campaign, even from those sectors most interested in his election. He
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Limited Distribution.
Drafted by Stedman. Copies were sent to the Secretary, Richardson, Johnson, Samuels,
Meyer, and Ambassador Korry. No meeting time appears on the memorandum.
378-376/428-S/80023
82 Foreign Relations, 19691976, Volume XXI
observed that political campaigning now requires large amounts of
money for the use of television, radio, and newspapers. According to
Mr. Parkinson, the Alessandri group expects to receive about $200,000,
whereas it estimates it needs about $3 million for the campaign. Credit
from media outlets is not available to Alessandri and there is no single
source of large funds open to him such as to each of his opponents.
Mr. Parkinson, in a very direct and hard fashion, put it to Mr.
Meyer that the Government of the United States must make a large fi-
nancial contribution to the Alessandri presidential campaign. He indi-
cated that if either Tomich or Allen de win, private enterprise in Chile is
finished. Alessandri must have funds for his campaign and if contribu-
tions are not made by the Government of the United States, it (and Mr.
Meyer) will have ensured a Castroite situation in Chile with adverse ef-
fects in other neighboring countries and throughout the hemisphere.
Mr. Parkinson said that the U.S. Government has made donations be-
fore in Chilean elections and it is widely known that we gave major
support to President Frei in 1964. He said that he fully approved of
low profile as a policy for the U.S. Government, which he interpreted
to mean fewer U.S. Government personnel abroad and less AID loan
projects. When it comes to key political issues such as the survival of
private investment, low profile should not mean leaving a vacuum in
the Chilean election campaign, according to Parkinson.
He said that the Alessandri group now suspects that the U.S. Gov-
ernment is helping Tomich, inasmuch as Alessandri is not receiving
anything from us. Furthermore, he said that many people believe that
the U.S. is retaining Ambassador Korry in Santiago because President
Frei requested it and we have agreed.
Mr. Parkinson said that he knows full well that the U.S. Govern-
ment has mechanisms for putting funds into Alessandris hands in a se-
cure fashion, so that he cannot accept an argument that there is danger
or risk in U.S. involvement becoming an issue in Chile.
He said that he did not expect Mr. Meyer to respond to his ap-
proach, either positively or negatively. He said he knows that such op-
erations as he is pressing for are not ones which we will own up to, ei-
ther to him or to the Chileans. He is anxious, however, that the highest
levels of the U.S. Government be aware of the need and the urgency for
direct U.S. Government financial help so that Alessandri can become
President of Chile. Parkinson noted that he expects to make an equally
hard presentation at higher levels in the U.S. Government and hoped
that Mr. Meyer would pave the way for such presentation, but that it
will be made in any case. He expressed the point that the survival of his
corporation was at stake; that political contributions are made every-
where in the world, including in the U.S.; and that it was in U.S. na-
tional interest to help save major U.S. investors in Chile. Parkinson said
378-376/428-S/80023
January 1September 4, 1970 83
he intends to report back to the Alessandri group that Anaconda has
done everything it can to get help for him from the USG, and he cannot
therefore just confine his approach to Mr. Meyer.
Mr. Meyer said that he understood the presentation made to him.
He stated that he would not respond to it, but commented that he was
saddened that situations materialize which bring a U.S. company to
suggest that the U.S. Government consider gross intervention in the po-
litical affairs of another country. He said that it was a pity that wealthy
and concerned Chileans did not make adequate financial contributions
to enable Mr. Alessandri to have all of the media coverage he needs in
the campaign. Mr. Meyer denied that the U.S. Government was helping
Tomich or that there was any reason or need for President Frei to inter-
cede with us to retain Ambassador Korry in Chile.
Mr. Parkinson said he hoped to discuss the matter again with Mr.
Meyer in a couple of weeks.
33. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, April 28, 1970, 2000Z.
1538. Subj: The Electoral Stakes, the Pot and the Jockey With the
Money. Ref: Memcon April 10 AnacondaMeyer.
2
1. (Summary) The following comments are designed for those as-
sessing the case for USG electoral intervention made to Dept by Ana-
conda Board Chairman Parkinson in presence of Council for Latin
America executives April 10. Whatever other judgments may be in-
1
Source: National Archives, RG 59, Central Files 197073, POL 14 CHILE. Secret;
Exdis.
2
Document 32. In an April 23 telegram to Headquarters, the Chief of Station re-
marked: On 22 Apr, Amb read to COS Santiago from recent memo of conversation be-
tween Asst Secy Meyer and Parkinson of Anaconda, accompanied by [name not declassi-
fied] and [less than 1 line not declassified], Parkinson made plea for campaign support for
Alessandri to tune of 3 (sic) million dollars and was told No. Amb sending Limdis
[Exdis] and (we gather) may make point that Alessandris campaign management in such
disarray that any money would be wasted. Presumably other considerations will be ad-
duced in support of hands-off posture. COS position with Amb that no useful purpose
served by direct funding of Alessandri. Beyond shadow of doubt, Alessandri campaign
suffering from severe budgetary stringencies. Only if Dep State abandons
non-involvement stance (and Sta[tion] not recommending it do so) would it be logical to
entertain some funding. (National Archives, RG 59, ChileITTCIA 19631977, Lot
81D121, Documents Requested by the Department of Justice, 19701977)
378-376/428-S/80023
84 Foreign Relations, 19691976, Volume XXI
volved there is one overwhelming practical obstacle: the impossibility
of maintaining a cover of discretion for any such suggested US action.
Parkinson has many of his facts wrong too about Alessandris cam-
paign finances, particularly the lack of any evidence of media adver-
tising shortage in Alessandris behalf and the easy capacity of his
Chilean supporters to provide the necessary cash instead of engaging
in flight of capital. Also US opposition to candidate of Christian Demo-
crats who control govt and largest single party would doubtless pro-
duce a negative reaction that would do harm to immediate and longer-
term US interests. Thus I remain persuaded that it is to our benefit that
we remain uninvolved in the campaign of any aspirants to the Chilean
Presidency and to prolong the current total lack of any mention of the
US in the campaign. I recognize that it will not make the US popular
with the parties (as distinct from the mass) and I am deliberately fo-
cusing responsibility on me for the decision in response to the soliciting
of Alessandri and Tomic camps so that animosities will not be directed
against Washington. It is not a very comfortable position to be a jockey
without a seat or pot but as King Victor Emmanuel the First said just
before expiring from an assassins bullet, these are the risks of the job.
(End summary)
2. Anaconda is right to be alarmed about its future if Alessandri is
elected. Tomic and Allende would nationalize copper. Tomic would
seek to maintain some acceptable relationship with the US; Allende
would not. Hence negotiation would still be involved with Tomic while
expropriation without compensation would follow an Allende victory.
The point is that I sympathize with Mr. Parkinsons concerns for the in-
terest of his company.
3. At the same time, I would offer these observations about Ana-
condas track record here:
A. It was Kennecott who surprised both the US and Chile in 1964
by offering to sell 51 percent of its properties to the GOC without being
requested. Anaconda refused to follow suit.
B. It is Kennecott who is currently maneuvering to take over the
management contract of Anaconda (as we reported last month). Ana-
conda has no rpt no apparent knowledge of this action although Ken-
necott has probably contributed to current Anaconda problem. (Embtel
1501).
3
C. At the very time that Parkinson was making his case to the
Dept., one of his Vice Presidents came here (Embtel 1299)
4
to urge my
3
Dated April 24. (National Archives, RG 59, Central Files 197073, INCO COPPER
CHILE)
4
Dated April 10. (Ibid.)
378-376/428-S/80023
January 1September 4, 1970 85
intervention with the GOC to save the extant copper arrangement. It is
reasonable to ask howwe can maintain any restraining influence with a
govt and a partythat of the Christian Democratsto save that ar-
rangement if the US were to be involved in an effort to defeat the Presi-
dential candidate of that party.
D. Mr. Parkinson states that it is widely known the US helped to
elect Frei in 1964 yet goes on to assert we could become involved in the
current campaign without risk of exposure. To this contradiction could
be added the facts that the GOC and the PDC are very alert to the mech-
anisms for transference of funds from US sources to Chile since they
were engaged in such an operation on behalf of Frei in 1964, that there
is not a Chilean of any stripe in the political arena who is unaware of
Anacondas current intentions and commitments and that all of the
politicians supported by Anaconda in recent years in one way or an-
other were widely known and without exception proved either bad po-
litical bets or disappeared into the woodwork when the critical show-
down on Anacondas future occurred last year.
E. It was the US who saved Anaconda in 1969 by my intervention
in a negotiation that met the Anaconda objective of a total price of some
$800 million. Contrary to Parkinsons assertions that Frei asked the US
to keep me on the job, it was Charles Brinkerhoff (Anacondas ex-
Chairman of the Board) who went to the Dept following last years ne-
gotiations to make that kind of request. I have since monitored that
agreement with the GOC.
F. It would be also imprudent to accept the political astuteness of
one who decided at the end of 1968 to permit the lapsing of aid expro-
priation insurance for 1969 on the grounds that there was no rpt no
danger of any GOC move in that direction despite my best efforts in the
previous 15 months to alert his company to an eventuality I felt was
inevitable.
4. Parkinson is correct in stating Alessandris camp is complaining
of little money. He is incorrect in asserting the other two candidates
have ample funds. The following is pertinent:
A. In addition to the $200,000 Alessandri is supposed to have
raised for his electoral kitty, an enormous sum is probably being pro-
vided in kind by leading publishers and radio station owners in the
form of hidden yet very large kickbacks on Alessandri advertising. The
net cost would then be a fraction of what appears on any books. More-
over the leading publishers of the country are stacking news and
photos to support their commitment to Alessandri. There is no dearth
of Alessandri paid propaganda in the media.
B. Parkinson seems to be ignorant of the Chilean law that prohibits
any electoral advertising on TV. Therefore there is no rpt no possible
TV cost.
378-376/428-S/80023
86 Foreign Relations, 19691976, Volume XXI
C. Alessandri could use more money without any question, yet our
most careful judgement is that the amount that could be usefully em-
ployed in the remaining four months would be at the very maximum
one million dollars. (Half the sum honestly and expertly used would
probably be enough.) One thousand Chileans each donating one thou-
sand dollars could supply that sum without any contribution from any
US quarter. Alessandris camp includes the overwhelming majority of
the high income group in Chile. There are literally thousands of such
Chileans in a position to make contributions of one thousand dollars.
Reasonable questions to ask are why they are not, why many are in-
stead currently engaged in flight of capital and therefore why the USG
should seek to substitute for their lack of commitment and of national
interest. This situation is the very antithesis of what I understand to be
the Nixon Doctrine.
5
D. One possible key to the so-called lack of money has been pro-
vided us in confidence by Gustavo Alessandri and other high-level Al-
essandristas. They say there is a danger of over-confidence that could
lead to complacency by businessmen. Hence they told us some time
ago that they would launch vigorous poor mouthing campaign to
scare contributors and to keep their supporters interested.
E. Alessandris people have so far not given the slightest indication
of any awareness that they must buttress their candidates household
name and his zest with some kind of electoral organization. The ten-
sions between groups of his supporters, the desire of each faction to be
commanders without concern for troops is blatantly obvious in San-
tiago where one-third the electorate is located. Money cannot substitute
totally for will and effort.
F. Any significant sum arriving from the US would be as discreet
as a moon launch. Not only does the GOC have the advantage of its
1964 experience and knowledge, but I have had too many painful expe-
riences in the past two years with supporters of Alessandri who believe
that discretion signifies only telling their five closest friends. To cite an
example, it was Foreign Minister Valdes who informed me in February
that Nacional Senator Pedro Iban ez had been to US agencies in Wash-
ington seeking funds for Alessandri and had been turned down.
5. Nonetheless in answer to a direct question from Anaconda Pres-
ident Hall in the presence of Brinkerhoff and Vice President for Chile
Krest Cyr on April 14 (Embtel 1386),
6
I said I was not rpt not advising
Anaconda to abstain from any contribution it or other US companies
5
For background on the Nixon Doctrine, see Foreign Relations, 19691976, vol. I,
Foundations of Foreign Policy, 19691972, Document 29.
6
Dated April 16. (National Archives, RG 59, Central Files 197073, INCO COPPER
CHILE)
378-376/428-S/80023
January 1September 4, 1970 87
wished to make. The question came after I had told them that in my last
monthly meeting with the US business community I had observed that
open allegiance to Alessandri had its inherent risks to their futures and
that in their own self-interest, they should be discreet in expression and
action. I told Hall, as I have said to the US business community from
the outset of my stay here, that it was the function of US business to be
profitable, that I would not presume to intervene in their pursuit of that
goal, that I would protect their legitimate interests to the extent that I
could at their request but in turn they could not expect me to intervene
beyond US or Chilean law to guarantee their profits or to seek to have
US sacrifice broad US goals for any narrow interest. I explained to both
groups that in my view the one relevant restraining influence we still
had on the PDC (in the absence of any significant economic or mil aid)
was the fear that we would intervene on Alessandris behalf in the elec-
toral process and that as long as we did not we had a reasonable hope
of maintaining decent rels with this GOC and, if Tomic won, with the
next govt. I had asked the US business community if anyone disagreed
to let me know. Anaconda, it appears from ref memcon is the only com-
pany to have made an approach.
6. In the interim I have taken soundings with those Chilean and US
businessmen who want Alessandri to be President and whose judge-
ment I most respect; they are without exception agreed that USG inter-
vention (A) could not be hidden and (B) would hurt Alessandri. More-
over, Alessandri is infuriated with Anaconda and with those Chileans
acting as intermediaries as reported in Embtel 1299.
7. I recognize of course that once the US business community
makes its contributions to the Alessandri kitty (and Anaconda has
good reason to contribute alone the aforementioned maximum of
$500,000) it will be difficult to maintain a USG posture of neutrality and
non-involvement. Anaconda would argue that therefore an attempt to
sustain a distinction is in practical terms meaningless. I disagree. The
past fortnight I have sought out Tomics campaign leaders who, inci-
dentally, also want very much a USG commitment to their candidate,
to explain why we are going to maintain complete neutrality, why we
believe such neutrality is the most effective weapon against the possi-
bility of an Allende victory. When they have talked of Anacondas in-
tentions to support Alessandri, I have admitted that the USG cannot
control the private actions of its citizens and that we agree with Tomics
public electoral affirmations that distinction must be made between the
USG and the actions of private Americans. I remain persuaded that as
long as the USG can honestly attend to its electoral neutrality with re-
spect to Alessandri and Tomic, it will be substantiated and accepted by
Tomic and his closest advisors despite their unhappiness with our
non-commitment to them. So far they admit to no contrary knowledge.
They state that so far no US funding from any source has occurred.
378-376/428-S/80023
88 Foreign Relations, 19691976, Volume XXI
8. As for the future of private enterprise in Chile, it could be ar-
gued that Henry Ford has done more the past two weeks to affect the
future direction of US investment in Latin America than anything Ana-
conda or the USG does in Chile. The announcement of a Ford deal with
Yugoslavia by which trucks will be produced by a company in which
Ford will have only 49 percent interest and the Yugoslav state agency
51 percent followed by the Ford discussions with the Soviets will make
it very difficult if not impossible for US companies to insist on classical
control. This is particularly true in a Chilean environment in which
local private enterprise has been for the most part a partner of govt in
this century and in which statist theories of one kind or another domi-
nate all three Presidential candidates. Ford is demonstrating that US
business is dynamic and that even Socialist countries need US
know-how. Anaconda placed its money on Frei to insure its future
and what happened? In putting money on Alessandri, it will not stem
an ever more apparent tendency there where profound historical dis-
tortions have created an unpropitious climate for classic capitalism. We
intend to do our best with an Alessandri administration to support
better incentives and structures for a more modern private sector but it
will be an uphill struggle.
9. A word about the elections. Alessandri is still in front and Tomic
appears to be gaining strength although still well behind. From a US
long-term interest point of view, the ideal finish would be Alessandri
and Tomic ahead of Allende. This would be a crushing blow for the
Marxists. Greater strength for Alessandri can come above all at the ex-
pense of Tomic. It is our view that Allende will be a much stronger
second if Tomic (he started behind the other two) loses ground. This in
turn raises two unpalatable possibilitiesthat the Chilean Congress
might elect Allende President and that the Christian Democrats would
become so weak a force in Chile that they could no longer act in the fu-
ture as the effective buffer to the steadily growing Communist and
other Leninist forces. This same analysis has been made by the very as-
tute Communist Party which would prefer Alessandri to Tomic and by
the Cardinal of Chile who recently intervened indirectly to weaken Al-
essandri and to help Tomic. (More on these two subjects in airgrams.)
10. One final thought about commitment. None other than Foreign
Minister Valdes in a conversation last week accused the USG of not
even caring if Allende were elected. In the exchange that followed my
denial Valdes referred to our lack of electoral support for Tomic and he
wove his resentment into his general argument that there no longer
was any material reason to sustain a belief of any special relationship
between Chile and the US. Valdes has his own well-known reasons for
wishing to normalize rels with Cuba (to keep Chile immune from ter-
rorism, to emulate Mexican neutrality and to make South America an
378-376/428-S/80023
January 1September 4, 1970 89
independent force in world affairs). We have fewer and fewer tangible
assets to employ to retain influence but if the US were to commit itself
to an anti-PDC electoral position, the short and long term consequences
with respect to what is still the largest single political party in Chile and
the government could have very serious consequences here.
11. Conclusion: I would understand a theoretical case to help both
Alessandri and Tomic to defeat the Castroist Allende and to demon-
strate a hedging US sympathy to each. I cannot see any theoretical ad-
vantage in helping one to fight the other with indirect benefits to Al-
lende particularly when such a commitment could not be discreet
and when such USG intervention would lead to the further indirect
commitment to bail out the new government whenever it got into
trouble. This longer-term implication of commitment is of very great
interest to both the Alessandri and Tomic camps in both psychological
and material terms.
Korry
34. Memorandum From Director of Central Intelligence Helms
to the Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, June 16, 1970.
SUBJECT
Chilean Election
1. [name not declassified] telephoned me this afternoon from the [1
lines not declassified]. He plans to be in Washington on Thursday for a
meeting and may head himself in your direction to voice his concern
about the upcoming Chilean presidential election scheduled for the
fourth of September. He is advocating that the United States Govern-
ment give a lot of financial help to the Alessandri campaign.
2. As you will recall, this election has been dicey and difficult to
figure for a whole variety of reasons going back many months. [1 lines
not declassified] We in the Agency are worried about pouring money
into the Alessandri campaign, because his political organization ap-
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret.
378-376/428-S/80023
90 Foreign Relations, 19691976, Volume XXI
pears to be so diffuse that we are afraid it will have little impact. On the
other hand, we recognize that Allende has been coming on pretty
strong despite what was alleged to be a heart attack some weeks ago.
3. The purpose of this note is to give you time to consider this
problem in the event you hear from [name not declassified]. The Agency
is following this matter closely, but it is only fair to say that we are in a
quandary as to what action is wise.
Richard Helms
2
2
Helms signed Dick above his typed signature.
35. Backchannel Message From the Ambassador to Chile (Korry)
to the 40 Committee
1
Santiago, June 18, 1970.
1. Santiago 2212 of June 12
2
reported the very strong race Marxist
Allende is making in the presidential campaign. Despite the striking
similarity with our unscientific analysis of two and a half years ago, the
percentage cited in that cable as our reckoning of the respective current
strengths of the three candidates are in fact based on the almost com-
plete results of the latest poll [1 line not declassified]. Those results reveal
a spread of only four percent between Alessandri and Allende and
about the same distance between the latter and Tomic.
2. More significant are the trend lines for the past month: con-
tinued decline of Alessandri, stagnation of Tomic and gathering
strength of Allende. Moreover the latest poll does not fully reflect the
impact of Allendes recently unwrapped package of giveaway pledges.
What it does show is a shift of women from Alessandri to Allende.
3. Unless altered, these trends could well culminate in the election
of Allende as President and, as a consequence, the inevitable imposi-
tion of a Leninist state in South America. An Allende presidency would
result either from his winning the first plurality in the September 4 bal-
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret.
2
This reference is most likely to telegram 2210 from Santiago, June 12, which is a
lengthy summary of the Presidential campaign and contains a paragraph on Allendes
surging campaign. (National Archives, RG 59, Central Files 197073, POL 14 CHILE)
378-376/428-S/80023
January 1September 4, 1970 91
loting or finishing such a strong second that the Congress might in the
runoff prefer his election in preference to that of Alessandris.
4. My position has rested on these assumptions:
a. No candidate would receive an absolute majority.
b. The critical period would occur in the period between Sep-
tember 4th and October 24th when the Congress would have to choose
between the top two contenders.
c. President Frei would re-emerge in that period as the most influ-
ential anti-Allende force in the country and in his Christian Democratic
Party (PDC).
d. U.S. interests were uniquely concerned with the defeat of
Allende.
e. U.S. support of any candidate would be counter-productive.
5. Tactics adopted to suit these assumptions were:
a. Amajor effort to convince all here, in Washington and elsewhere
of our total non-involvement in the campaign. Unless everyone be-
lieved it, no one would. Unless the cover of aloofness were firmly es-
tablished, our relatively modest ongoing program to divide the leftist
camp and to finance anti-Allende propaganda might not have been as
securely established as it is. This endeavor has been successful if the
current Marxist campaign to blame Anaconda and other private orga-
nizations for electoral intervention is any gauge.
b. A major effort to cater to Frei by personal inflation of his ego, by
repeated messages through his most trusted lieutenants that he would
be the key man come September 5 in the presidential decision and by
abstention from any interim conversation with him on the election.
This message has been heard and fully understood by Frei.
c. An effort to maintain good contacts with the Army and other
services despite the lack of MAP hardware by personal contact and by
responding to their minimal needs. (Our ability to satisfy promptly the
armed services request to buy emergency equipment is critical in this
regard.)
d. A coordinated effort to exploit on appropriate occasions our
much-respected fame here as unmatched electoral seers to propagate
the view that Allende is running strong and if his two opponents did
not modify their fixation of mutual destruction, Allende would win.
e. A funding of Radical Party dissidence designed to weaken that
reed of Allende strength.
6. The Aristotelian injunction that political wisdom consists in the
ability to make distinctions prompts me to seek now to reinforce very
substantially our ongoing anti-Allende effort. It is the Marxists strength
not the weaknesses of their opponents with which we must deal. I say
must because of our unanimous conviction that the consequences of
an impressive Allende polling would be very grave for Chile and South
378-376/428-S/80023
92 Foreign Relations, 19691976, Volume XXI
America, sufficiently serious to undermine totally the new Latin policy
launched by the October 31 speech of President Nixon
3
and imple-
mented in many subsequent actions. I am also persuaded that it would
sap U.S. will to implement our policies in Asia and elsewhere.
7. What we recommend is consistent with our previous submis-
sion, with our original assumptions and with our ongoing tactics. We
have been awaiting the May opinion poll for six months and have been
utilizing that interim time in order to prepare a base for subsequent
greater effort if required. The poll simply confirms our original analysis
sufficiently to mobilize our latent resources.
8. Our three principal targets in the remaining short time should be
Frei, women and Radical Party members. Of these the most critical and
immediate are the women who as a group remain least responsive to
Allende and most sensitive to the implications of a Leninist state. The
Radical Party clientele comprises the largest single swing potential in
the Chilean electorate; totalling at least twelve percent of the voters,
they are not Leninists and despite the inclusion of their party in the
Popular Front most have misgivings about the implications of an Al-
lende Government.
9. Recently because of the failure of anyone to launch a nationwide
anti-Allende campaign a group of [less than 1 line not declassified] resus-
citated a 1964 anti-Allende organism. [1 line not declassified] Contrary to
my original assumption, this operation is not known to the Council for
Latin America (CLA) and one of [less than 1 line not declassified] ground
rules is that the CLA which has a reputation for indiscretion in such
matters be kept ignorant. Another ground rule is that [less than 1 line not
declassified] will not utilize these [less than 1 line not declassified] private
funds for electoral propaganda in favor of a candidate. The private [less
than 1 line not declassified] group has pledged [dollar amount not declassi-
fied] for the anti-Allende propaganda campaign and their [less than 1
line not declassified] counterparts has promised [dollar amount not declas-
sified]. It is clear to us that a good deal morein excess of [dollar amount
not declassified] according to our calculationswill be required to make
this effort, which has begun, successful in the last two months of the
campaign.
10. Another effort to subsidize orthodox Radical Party senators
and deputies in their underground campaign of disloyalty to Allende
has been launched. To name only one likely target of opportunity,
[2 lines not declassified]. About [dollar amount not declassified] are re-
quired for this undertaking.
3
Nixon outlined new directions toward a more balanced relationship with Latin
America in his remarks to the Inter American Press Association on October 31, 1969. See
Public Papers: Nixon, 1969, pp. 893901.
378-376/428-S/80023
January 1September 4, 1970 93
11. The Radical Party is being targeted now to produce votes for
Alessandri as we recognized would also be the consequence of the po-
litical action program approved by the 40 Committee. It has another
facet as well. If Allende is to be prevented from gaining the presidency
via the congressional vote, ample funds may well be required to dis-
suade hesitant Radical or Christian Democratic congressmen from in-
dulging their credulity. You will recall that nominally, 82 of the 200
senators and deputies who will decide the runoff in October are
pledged to Allende, 75 to Tomic and 43 to Alessandri. Hence the Rad-
ical Party operation is the precursor to a second phase for which there is
a maximum contingency fund need now of some [dollar amount not
declassified].
12. Other pertinent factors include:
a. The Alessandri campaign which projects a deficit (covered by
credits) of at least $700,000 by September 4 is sopping all local available
funds so that the three operations outlined in paragraphs 911 above
are out of their ken and their capacity to handle. I anticipate that the Al-
essandri forces will begin to target more on Allende in the coming
weeks but the confusion that reigns in that camp precludes any inclu-
sion of their efforts in our calculations.
b. The Anaconda Company, from indications we have here, has
been having second thoughts about contributing directly to Alessandri.
Anaconda is a company that has the biggest stake in these elections and
could well invest far more than the [dollar amount not declassified] they
had in mind only a few weeks ago. However they are not involved in
[less than 1 line not declassified] endeavor and their negotiations with Al-
essandri lieutenants appear to be less than harmonious. Anaconda is so
perilously indiscreet and so insistent on the recipients awareness of the
benefactor that no one is anxious to receive its embrace.
c. [7 lines not declassified]
13. In sum, I am requesting approval for funding of three activities,
two during the electoral period requiring a total of what we calculate to
be [less than 1 line not declassified] and a third for the immediate post-
electoral period of [dollar amount not declassified]. I do so in calm pursuit
of unchanged goals and in cold calculation that less than [dollar amount
not declassified] is a very small insurance policy to pay when Chile is in-
debted to the Ex-Im Bank alone for roughly $500,000,000 (M), when An-
aconda is counting on receiving at least an equivalent sum, when AID
has provided almost that much in loans to the Frei Government prior to
FY 69, when U.S. expropriation guarantees are well over $100,000,000,
and when we have not signed any loans worth mentioning (total
$2,500,000) for almost two years.
14. I am, of course, fully aware that our anti-Allende program
might result in benefitting one candidate more than another. But I am
persuaded that there are so many extraneous factors beyond our ca-
378-376/428-S/80023
94 Foreign Relations, 19691976, Volume XXI
pacity to influence or to manipulate (Alessandris physical condition to
mention one glaring factor) that the final beneficiary is beyond accurate
prediction. Allende and he alone is our target.
15. I am also personally satisfied that there is an absolute min-
imum risk of exposure in the expanded program we are proposinga
problem which contemplates use of existing mechanism and relation-
ships. [1 lines not declassified]
16. Finally, the time factor is critical. If our funding is to be used ef-
ficiently and effectively with the essential advance preparation, we
must have an early decision, at the very latest by July 1.
17. I suppose that one should always apologize for doing the right
thing since nothing wounds people more but it is not at all the
wicked who do the most harm in this world, as Paul Valery wrote. It
is the maladroit, the negligent and the credulous.
36. Backchannel Message From the Deputy Assistant Secretary
of State for Inter-American Affairs (Crimmins) to the
Ambassador to Chile (Korry)
1
Washington, June 20, 1970.
SUBJECT
Increased USG Activity in Chilean Election
1. We need your comments on following points by no later than
9:00 AM Monday morning June 22 since your important proposal to be
examined at high level on Tuesday June 23.
2
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Kissinger Of-
fice Files, Box 128, Country Files, Latin America, Chile Wrap-Up and Post Mortem. Se-
cret; Immediate; Sensitive. According to an October 9 CIA memorandum summarizing
policy decisions related to the covert action involvement in the Chilean election, this mes-
sage was sent following a June 19 meeting between representatives of the Department of
State and the CIA. At the meeting, Crimmins raised the following objections to the ex-
panded program proposed in Document 35: (a) he doubted the need for this activity;
(b) he was disturbed at the pro-Alessandri cast it took; (c) the risk was greatly heightened
by the magnitude of the funds; (d) he was concerned by the vagueness of the arrange-
ments; and (e) about the risk, he noted that what the U.S. Government was trying to
avoid might be avoided by natural causes, and, furthermore, an Allende victory may not
be the end of the world. (National Archives, RG 59, ChileITTCIA 19631977, Lot
81D121, ChileCIA 1970) No memorandum of conversation of this meeting has been
found.
2
The proposal referred to here generally and in specific paragraphs later in this
message is in Document 35. The high-level meeting of June 23 was held on June 27; see
Document 41.
378-376/428-S/80023
January 1September 4, 1970 95
2. It would appear that May poll used as an element of judgment in
your analysis reflected results in greater Santiago area only and that
you had not yet had benefit of country-wide results. We note that in the
Santiago poll Allende is second with 32.1 percent following Alessandri
with 35.1 percent, but that in the later national results Allende is in
third place with 28.4 percent and Tomic is in second with 29.6 percent.
In the latter poll Alessandri still leads with 35.6 percent. Assuming you
now have results of both polls, do you believe any modification in your
proposal is warranted?
3. We are not clear about the composition and role of [less than 1
line not declassified]. Who are the [less than 1 line not declassified] elements
in the [less than 1 line not declassified]. What is the [less than 1 line not de-
classified] front? What did [less than 1 line not declassified] do in 1964 elec-
tion? What activity, if any, would [less than 1 line not declassified] carry
out as an institution in the expanded program funded by us? Are you
completely satisfied that [less than 1 line not declassified] activity is not
known to Council for Latin America (whose activity, as you have
noted, is fraught with risk)?
4. We are not clear about the intended future role of President Frei.
We assume that what you have in mind is in no way related to pro-
posed post-election program but is, rather, encouragement from us to
play an active part in influencing votes in the Congress away from
Allende.
5. We would appreciate clarification of current activities related to
Radical Party. In para 10 of your message you say thatAnother ef-
fort to subsidize orthodox Radical Party . . . has been launched. Are we
correct in interpreting this to mean that it is [less than 1 line not declassi-
fied] and not rpt not we that has launched another effort? It would also
be helpful to our consideration to have some clearer idea of the prior ef-
fort implied by the reference to another effort.
6. We would appreciate further assessment of the risk factor.
Agency has briefed us on the operational details as you suggested in
para 15. We have noted the heightened and expanded relationship with
[less than 1 line not declassified]. As you know, approval of the earlier,
much smaller program was conditioned on its not becoming a
pro-Alessandri operation. Given increased dependence [name not de-
classified] to what degree does proposed greatly augmented program
increase risk of use of our effort in behalf of Alessandri rather than
against Allende, with obvious disadvantages. If risk is indeed in-
creased, how do you foresee handling the problem? We assume you
would agree that, as in modest program, we would suspend expanded
program if it were to be used for Alessandri.
7. Still on risk factor, in your telegram 2230 of April 28 commenting
on the AnacondaParkinson pitch to Assistant Secretary Meyer for
378-376/428-S/80023
96 Foreign Relations, 19691976, Volume XXI
USGfinancial contribution to the Alessandri campaign, you noted any
significant sum arriving from the U.S. would be as discreet as a moon
launch.
3
While we recognize that you were talking about a program of
support for Alessandri, we would like your comment on relevance that
comment to effects of expanded program.
3
The quote is from telegram 1538, Document 33.
37. Backchannel Message From the Ambassador to Chile (Korry)
to the Deputy Assistant Secretary of State for Inter-American
Affairs (Crimmins)
1
Santiago, June 22, 1970.
Please Deliver Following to Ambassador Crimmins (at Opening of
Business Monday 22 June).
1. Bless your superior internal communications and the appro-
priate questions that you present. Indeed I did not have results of na-
tionwide poll when I presented proposal. Before I respond to question
re modification, I prefer to answer questions in your cable first.
2. I would have thought Broe and company would have complete
dossier on [less than 1 line not declassified] since it was one of the signifi-
cant instrumentalities in the 1964 US effort to elect Frei. It was estab-
lished for the purpose of transferring funds from US private business to
Chileans who handled what the Communists call a terror campaign
against Allende.
2
The only active American in the 1964 operation still
here is [6 lines not declassified].
3. [name not declassified] decided to resurrect the [less than 1 line not
declassified] some two months ago whereupon he went to the US to gain
the approval of his executives and to acquire the first contribution to
the kitty. He then contacted another charter member of [less than 1 line
not declassified] to act as operating agent in the US in the fund-raising
campaign. The second man is [2 lines not declassified]. A third [2 lines
not declassified]. They in all have contacted the headquarters of such
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Kissinger Of-
fice Files, Box 128, Country Files, Latin America, Chile Wrap-Up and Post Mortem. Se-
cret. This message is a response to Document 36.
2
Information on U.S. involvement with the 1964 election is printed in Foreign Rela-
tions, 19641968, vol. XXXI, South and Central America; Mexico.
378-376/428-S/80023
January 1September 4, 1970 97
firms as [2 lines not declassified]. Recently to [2 lines not declassified], for a
contribution. Perhaps that contact explains why Communist El Siglo a
few days ago (as we reported) headlined that Anaconda was contrib-
uting $250,000 to launch a terror campaign against Allende. Siglo cited
very accurately that the ground rules for the operation were that no rpt
no candidate would be supported with these funds and that the money
would be targetted uniquely against Allende. The Siglo report coin-
cided with a coordinated campaign by all three Marxist dailies in San-
tiago to propagate the notion that USG and US companies really pre-
ferred Tomic. As I commented in a State cable,
3
I welcomed this
development for a variety of obvious reasons: that US companies
were taking the expected heat on contributions, but not the USG; that
the USG was described as being favorable to Tomic with one breath
and to Alessandri with the other and that our opposition to Commu-
nism remained implacable. These three ideas will not rpt not help Al-
lende in my judgement nor do the US anything but good.
4. [name not declassified] has kept me alone of US officials informed
of [less than 1 line not declassified] activities. He has not and does not ex-
pect any US complementary activity since I have gone to considerable
pains to propound to everyone the well-based reasoning for a hands-
off US policy in the Chilean elections. Even the Communists seem to
have so far accepted it. [2 lines not declassified]. All that US companies
are required to do is to deposit dollars to accounts in the Bahamas.
Therefore there is no rpt no entry of escudos or dollars into Chile since
[less than 1 line not declassified] makes their escudos available at the
blackmarket rate. It is flight of capital and defense of interest at the
same time.
5. Any additional funds going to [less than 1 line not declassified]
would be handled in the same manner to expand the current operation.
The US business-Chilean business activity would simply be amplified.
The Agencys assumption is that only [name not declassified] himself
would know of any additional funding and the source. As for CLA, my
guess is that once Anaconda and [name not declassified] were brought
unwisely into the act, CLA must be aware of what their member com-
panies are doing. [less than 1 line not declassified] Now that Siglo has sur-
faced the accusation against Anaconda, it is largely irrelevant as to
whether CLA is conscious of the activity. I have, as you know, always
expected the Communist charge, the Anaconda muddling and the ac-
tivity. Hence there is no new element. Rather there is a better USG
cover.
6. Frei, with whom I had a private dinner last night at his initiative
(see below) could in certain circumstances play a very significant role
3
Not further identified.
378-376/428-S/80023
98 Foreign Relations, 19691976, Volume XXI
in the period between Sept. 4 and Oct 24 when the Congress must
choose the President. To buttress his role, funds will be required to in-
fluence congressional votes. Our proposal is simply to make available
to [less than 1 line not declassified] who have close relations with Frei and
many intermediaries and levers, resources for those indirectly desig-
nated by Frei. He would not rpt not be privy to our interest under any
circumstances. This type of operation is not unusual in Chile or in
many other lands of this world where the US is not involved in them.
Frei would not rpt not get directly involved in any buying of votes op-
erations nor would we.
7. You are correct in your assumption about another effort to sub-
sidize orthodox Radical Party. The prior effort is that already ap-
proved and ongoing [less than 1 line not declassified].
8. I believe that the foregoing replies indirectly to your justifiable
concern about the moon launch reaction to a significant sum. We are
not rpt not talking any longer about either significant sums by my
measure nor about their arriving here. That brings me to the crux of the
problem we confront per your para 6 and the degree of support for
Alessandri.
9. As Broe, [name not declassified] and others know, I have always
had the greatest disdain for polls and poll figures. The only time they
can be reasonably accurate is in the last week before the election when
they can no longer affect operational decisions. Leaving aside the most
recent example of the British elections and turning to positive ex-
amples, the Embassy (that is State alone) called the Congressional elec-
tions of 1969 within one percent of error and in December 1967 in the
only significant by-election in Chile in three years, we predicted the
upset outcome with an error of zero. All of which is to say that I am not
moved one way or the other by the polls but since I must deal with es-
tablished and conventional wisdom and since I recognize that an un-
scientific approach would not be universally convincing, supporting
data is welcome. Frankly, had I know that the weighted national poll
results to which you refer in your para 1 and 2 will become available
after cross-checking on July 2nd, I would not have requested a decision
from Washington by July first. But in all candor, I regard the poll data
from here more as debating points than as contributions of intrinsic
value, particularly some two months before an election.
10. So for administrative reasons, I am now compelled to fall back
now on the unscientific labor for which political animals such as I are
paid. I might prepotently add that one reason Frei sought me last night
in his first private dinner party in the five or six months since his wife
suffered a serious illness is that he believes (unfairly to the Embassy) I
am the most objective and accurate political reporter in Chile. Aside
from the above examples, he recalls that ten weeks before the US Presi-
378-376/428-S/80023
January 1September 4, 1970 99
dential elections I forecast to him the exact percentages of our national
vote.
11. What I offer now as one mans view without the advice or con-
sent of any other here are the views I gave to Frei in his lengthy interro-
gation of me last night
4
and with which he agrees completely. His con-
currence counts for me because I regard him as the most perceptive and
successful politician in Chile without any close competitor.
12. The three candidates are now fairly bunched. In my view Al-
lende is over 30 percent, perhaps by one percentage point, perhaps by
some two. This is the base Marxist strength in the country. Tomic is
now at or very close to the vote that the Christian Democratic Party re-
ceived in 1969 which was roughly 30 percent. Alessandri is at 35 per-
cent or slightly above or below that level. (Even the national poll pre-
weighted results to which you refer show a gap of only 7 percent
between high and low and those figures have some very curious sta-
tistics for some regions that understate my assessment of the real Al-
lende strength. This understatement factor is important because in ex-
amining other pollings in the 1969 elections, the Communists were to
my mind so outrageously under-calculated that I decided then to ig-
nore polls in Chile; the actual results in the elections confirmed our
arithmetic and belied the polls on the Communists. There is a well
known unwillingness in Chile to declare in favor of Communist
candidates.)
13. If Tomic were to make any kind of appeal to the tens of thou-
sands ready to abandon Alessandri as the ineffectual, disorganized,
non-programmatic old bumbler that he really is, Tomic would have a
reasonable chance to finish a strong second and possibly first. But
Tomic is still looking beyond the elections to governing with Commu-
nist support and hence has no rpt no evident desire to consider even
the possibility of attacking Allende in such a way as to draw a clear dis-
tinction between his approach and that of the Popular Unity candidate.
On the contrary, two of his closest advisors told me at dinner a few
nights ago that if Tomic loses they will seek to enter an Allende govt
and they made no bones that they would go all out for the Congres-
sional election of Allende if he were to finish second and Tomic third.
There is nothing novel in these revelations since Tomic is committed
intellectually to the need for a through-going revolution in Chile in
which capitalism and neo-capitalism are eliminated. He believes it er-
roneous not rpt not to treat Communists here as Chileans first and as
Communists second. At the same time he sent to me last Thursday
5
(and Frei was astounded to learn of it) an elaborate 36 page profile of
4
Sunday, June 21.
5
June 18.
378-376/428-S/80023
100 Foreign Relations, 19691976, Volume XXI
his life which the PDC is now distributing and in which Tomic does the
one thing that will surely put up the back of the Communistsa de-
fense of the US and its overall foreign policy.
14. Given Alessandris steady erosion, Allendes base, Tomics in-
ability so far to catch fire we have a true horse race. The fact that in San-
tiago, where we have evidence from many quarters, the latest being
Frei to me, that women are abandoning Alessandri for Allende, is sig-
nificant. Frei said he had never anticipated that kind of shift and he
blamed the Tomic campaign line for the phenomenon, adding that no
one could understand what Tomic was saying and that women above
all want clarity and authority. It has been my assumption from the
outset that unless Alessandri won by at least five percent, he would not
be President. Frei agreed and said that nothing except providence
could alter the inevitability of the second man, be it Allende or Tomic,
being elected President if the margin were under five. At five, he
thought it would be close in the Congress and he only saw daylight at
the six to seven percent range. He said there was no doubt that the PDC
would elect Allende by abstention or by vote if the margin were under
five.
15. In our proposal we recognized that [name not declassified] sup-
port of Alessandri meant that willy-nilly there would be indirect US
support for Alessandri even if we did nothing but anti-Allende work
since the internal transfer of resources [less than 1 line not declassified]
would free funds for Alessandri campaigning and since some of the
mechanisms the Agency wishes to use (for women and Protestants) are
laboring for Alessandri. The same situation prevails [name not declassi-
fied] which Washington approved. I would like to be in a position to say
that the US was doing nothing but hitting Allende but in order to hit
him, we have no option but to use mechanisms that are effective at
reaching voters. Some of those mechanisms happen to be committed to
Alessandri. Since that part of our proposal does not involve much
money and since the foregoing rationale converts qualms into hypro-
cisy, I am not much bothered by the concept.
16. Frei agrees totally with my assumption that an Allende gov-
ernment would mean the imposition within Chile within two to three
years of a govt that would be not significantly different than those of
Eastern Europe. He believes Allende must be defeated.
17. He agrees too that Allende must be the electoral target and
more importantly, he believes that it is impossible to say who would be
the beneficiary of an assault on Allende. He is convinced that the most
effective attack would be one from the PDC but he despairs of that pos-
sibility. No matter what the mechanism, Tomic might well benefit suffi-
ciently, in my view, to finish second and to be elected. Frei has heard
378-376/428-S/80023
January 1September 4, 1970 101
that the PCCh is planning to focus criticism on Tomic and he is praying
that it will occur and provoke a response.
18. Frei recognizes that many Chileans who might vote for Ales-
sandri would do so simply to assure stability and the earlier than usual
return of Frei to power. At the same time he seconds my judgement
that Alessandri as President would seek to buy off Communist neu-
trality by concessions in foreign policy and by cooperating in the reduc-
tion if not destruction of the PDC. This latter factor would mean the
PCCh would build on the expanding base they are providing them-
selves via the Allende campaign machinery by having a free hand to
amplify their hold on labor, on schools and universities and in the
countryside. However he, like I, would prefer to buy time with Ales-
sandri than to risk Allende. He too believes that Alessandri has all the
symptoms of Parkinsons disease (trembling hand, dragging leg and
slurred speech) and that his tenure might be considerably shortened.
19. Freis judgement on his Army is more bitter than our own. He
says they are not only extraordinarily ignorant but they suffer from
moral cowardice. He compared them in very unfavorable terms with
the level in Peru and said they would have to be driven like cattle to
play any role of any significance in Chile. He dismisses them as a factor
in this election but believes that if the MIR and Socialists provoked true
unrest in the country, the Army would have to be employed. He gives
high marks to the Carabineros.
20. In sum, your position is very much akin to that Moliere char-
acter who counselled: You should always act in conformity with the
majority and never make yourself conspicuous. To which I respond
that I will neither make you conspicuous nor can I guaranty any ma-
jority. But I do believe it is prudent to seek some guaranty against a ma-
jority that would become very conspicuous indeed in Latin America
that of Allende. If he were to gain power, what would be our response
to those who asked, what did we do. I am seeking by political action all
that I can conceive to get the Chileans to muster their own forcesand I
think with some success. But when I examine those three areas that
contain almost 55 percent of the electorateSantiago, Valparaiso and
Concepcion ProvincesI see considerable Allende strength and poten-
tial. I conclude that our inputs while imperfect and modest could con-
ceivably provide the margin of safety. I am aware that we have no iron-
clad assurances of enduring secrecy; I am also troubled by many of the
doubts that provoked your cable and your questions.
6
But I would be
derelict in my convictions if I were not to flag the danger and to offer a
proposal to deal with it.
6
See Document 36.
378-376/428-S/80023
102 Foreign Relations, 19691976, Volume XXI
38. Memorandum for the 40 Committee
1
Washington, June 22, 1970.
SUBJECT
Political Action Related to 1970 Chilean Presidential Election
1. Purpose of the Memorandum
A. This memorandum refers to the CIA proposal for political ac-
tion in Chile which was endorsed by the 40 Committee on 25 March
1970.
2
This paper also brings the Committee up to date on significant
voting trends in Chile since the previous presidential poll conducted in
January 1970, and recommends that the Committee endorse an expan-
sion of existing political action programs. The additional measures are
required to reduce the increased threat of a presidential victory by So-
cialist Salvador Allende, candidate of the Popular Unity (UPa coali-
tion of Communists, Socialists and leftists).
B. The CIA proposal to the Committee on 25 March was consid-
ered adequate to deal with the threat of a presidential victory by Al-
lende at that time. However, the CIA said that if a subsequent poll re-
flected significant gains by Allende, the Ambassador and the CIA
Station Chief might recommend additional action.
C. On 18 June Ambassador Korry recommended an expansion of
the CIA political action program based on his analysis of the continued
decline of Jorge Alessandri, the independent candidate, the stagnation
of Radomiro Tomic, the Christian Democrat Party (PDC) candidate,
and the gathering strength of the UP candidate, Allende.
3
The Ambas-
sador cites the results of a poll which reveal a spread of four percent be-
tween Alessandri and Allende and about the same distance between
the latter and Tomic to support his recommendation. He also notes that
the same figures show a shift of women voters from Alessandri to Al-
lende. This trend, unless altered, could well culminate in the election of
Allende as President and the imposition of a Leninist state in Chile ac-
cording to Ambassador Korry.
D. The results of a nation-wide poll, which is 99 percent complete,
show Allende making significant gains, largely at the expense of Ales-
sandri. Tomic also showed some gains, again at the expense of Ales-
1
Source: National Security Council, Intelligence Files, Subject Files, Chile, 1970. Se-
cret; Eyes Only. A notation at the bottom of the first page reads: Conditional approval
given by 40 Committee on 27 June 1970. No further action to be taken without 40 Com-
mittee approval.
2
See Document 31.
3
See Document 35.
378-376/428-S/80023
January 1September 4, 1970 103
sandri. Thus, the gap among the three candidates has narrowed and the
chances of Allendes election are improved.
E. A comparison of the two nation-wide presidential polls is set
forth below:
January May/June
4
1970 1970 Change
Alessandri 44.4 35.6 8.8
Tomic 23.1 29.9 +6.8
Allende 18.5 28.4 +9.9
Undecided 14.1 6.3
2. Candidates and Developments
A. Former President Alessandri started his campaign with a com-
manding lead of an estimated 45 percent of the Chilean voters on his
side. From the beginning it was expected that his strength could erode
to a base level of 35 percent, and he has nearly reached that figure. This
loss in popularity is due primarily to Alessandris unique campaign
which is characterized by an amateur organization staffed by incompe-
tents whose inexperience results in wasted resources, ineffective prop-
aganda, and squabbling over a post-election program. The mobiliza-
tion of supporters and formulation and dissemination of a positive
message to the Chilean voter has been largely ignored. The only sem-
blance of an organization available to Alessandri, the National Party,
has been shunted aside by his supporters who believe that Alessandri
can win on his name alone and that it is more important to defend his
previous administration and attack President Eduardo Frei than to pre-
vent a victory by Salvador Allende, the candidate of the Popular Unity.
B. Radomiro Tomic is the only presidential candidate with both
ample funds and an effective party organization. His campaign plat-
formis not easily understood by the Chilean voters. To them his attacks
on capitalism contrast with his assurances of the need for a private
sector; his calls for true revolution nullify his justification of President
Freis reform program; and his insistence on eventual unity with the
Marxist-led forces of the UP front make it difficult for the voter not to
conclude that it would be simpler to elect Allende and have a socialist
revolution. Tomics strategy is based on the assumption that an Ales-
sandri collapse will provide the massive switch of votes necessary for
him to win the election. While both Allende and Tomic are benefiting
equally from the Alessandri erosion, Tomic has failed to attract voters
from the Popular Unity.
4
99 percent complete. [Footnote is in the original.]
378-376/428-S/80023
104 Foreign Relations, 19691976, Volume XXI
C. The Popular Unity campaign has moved into high gear. Allende
quickly disposed of a heart attack rumor in May 1970 with an impres-
sive television performance followed by a massive public rally in San-
tiago on 2 June. He has announced a package of forty demagogic yet
appealing promises to the Chilean electorate. Allendes critics attack
his proposals to end inflation, readjust public housing rents, slash the
cost of medicines, and thirty-seven other giveaway promises. How-
ever, he is successfully appealing to the have-nots in Chile. The huge
demonstration in Santiago provided an opportune, invigorating, and
unifying shot in the arm for Allendes campaign.
3. Covert Activities
The covert activities endorsed by the 40 Committee on 25 March
1970 are being implemented. The effectiveness and impact of these ac-
tivities is substantiated by the fact that Allende took approximately 15
minutes during one recent nation-wide TV interview to counter the
CIA poster and propaganda campaign linking him to the Communist
Party of Chile (PCCh), to Cuba, and to the USSR. It is felt that the ac-
tivity against the Radical Party has assisted in causing several promi-
nent party leaders to withdraw publicly their support from the UP
coalition.
4. Coordination
Ambassador Korry recommended this expansion of covert action
operations aimed at reducing the possibility of a presidential victory by
Allende. This proposal has been discussed with Deputy Assistant Sec-
retary John H. Crimmins and Deputy Director for Coordination Wym-
berly Coerr, and is currently being considered by the Department of
State in consultation with Embassy Santiago.
5. Recommendations
A. There is a State/CIA consensus that no candidate in the 1970
presidential election will win a majority. If so, the Chilean Congress
will select the next president from the two candidates receiving the
largest popular vote. Traditionally, the congress has selected the candi-
date with the higher popular vote, but the Chilean constitution allows
for congress to choose either. The present composition of the congress
is such that if Allende runs a close second to Alessandri in the voting,
there is more than an even chance that the congress will elect him
president.
B. Based on Allendes present strength and the possibility of a con-
gressional run-off, Ambassador Korry, with the concurrence of the CIA
Station Chief, has proposed that the CIA engage in increased political
action against Allende, while continuing to deny direct U.S. Govern-
ment support to any of the candidates. The expanded program in-
volves two phases, the first of which includes a marked increase in
anti-Allende propaganda activities, subsidies to bona fide pressure
378-376/428-S/80023
January 1September 4, 1970 105
groups, and additional efforts to decrease Radical Party support for the
UP during the pre-election period. The second phase is a post-election
contingency to influence a sufficient number of members of congress to
vote in a manner which will assure that he is denied the presidency.
C. The expanded effort will use those mechanisms already en-
dorsed by the 40 Committee, plus the inclusion of other existing polit-
ical action capabilities available to the CIA Station.
D. The mechanisms, assets and funding channels to be used have
been tested and are of proven reliability. Although the political climate
remains sensitive to the U.S. and the CIA, there is a justifiable expecta-
tion that these activities can be conducted without the U.S. hand
showing.
E. The estimated costs of the expanded activity during FY 71 are:
(1) for phase one, an additional $300,000 and (2) for phase two, a contin-
gency fund of $500,000. It is recommended that the 40 Committee en-
dorse these activities as requested. Funds are not available within the
Agency and must be sought from the reserve for contingencies.
39. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, June 23, 1970.
SUBJECT
Chilean Election
Ambassador Korry has recommended increased funding for polit-
ical action in the pre- and post-election period in Chile:
2
$390,000 for anti-Allende propaganda and to subsidize the cam-
paign of Radical congressmen who are anti-Allende; and
$500,000 for a post-electoral operation to dissuade Radical and
Christian Democrats from supporting Allende in any congressional
vote.
It seems to me we have to ask the following questions:
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. Sent for action.
2
See Document 35.
378-376/428-S/80023
106 Foreign Relations, 19691976, Volume XXI
1. Is there a real possibility that Allende may be elected?
Everyone agrees that his strength is rising, but there is no clear
prospect that he will win and a possibility he will not.
2. How serious to our interests would his election be?
Korrys premise is that Allende is a serious threat to the U.S. and
that his victory would result in the establishment of a Leninist state.
It is not clear, however, that Allende can ride quickly and successfully
over Chilean forces which would fight the establishment of a Leninist
state, or that the Chileans themselves cannot handle that problem.
There is no question that his victory would present problems to us.
Whether that means a serious threat to US security and national in-
terest requires a better and more systematic judgment, because how se-
rious we deem the threat to our interest to be will determine the risks
we are willing to take to insure his defeat. I do not think we have
reached sound conclusions yet, and certainly not a consensus.
3. How effective would Korrys proposals be?
There is no guarantee it would have any real effect, but there is
some chance that it may influence a small percentage of voters which
could be important in the close race we expect.
4. How serious is the risk of exposure and what is the threat of exposure to
our interests?
Korry believes the risk of exposure acceptable, but a significant
risk does exist. The Chileans are sensitive to and expect us to be in-
volved and will be alert to it. The Christian Democrats know we were
involved last time, since they were the beneficiaries. Moreover, the
channels being employed are well-known Alessandri backers with ex-
tensive contacts with US business firms in Chile and New York which
are already involved in a pro-Alessandri or anti-Allende activity.
Exposure would seriously damage our capacity to have influence
in any post-election situation. Exposure of our involvement would
strengthen Allende.
5. Do the risks to our long-term interest of an Allende victory outweigh
the risks of exposure?
The key question. I am not sure that they do; the problem of an Al-
lende victory may be easier to handle than the electioni.e., we may
find it easier to be involved if the problem is a Marxist administration
than to be involved in an internal electoral process.
If we were to be faithful to the prescriptions of our general policy, we
should leave to the Chileans the protection of their own interests threatened by
an Allende win. There is no real lack in Chile of money or organizational
skill. Why should we do for them what they are unwilling to do for
themselves? The premise in Korrys proposal is that we cannot count
on the Chileans themselves or private US interests to do an adequate
378-376/428-S/80023
January 1September 4, 1970 107
job against Allende, and that we cannot afford to let them fail. This is
the basic premise and I am not sure it is proven.
Recommendation: In balance I would go along reluctantly with the
pre-electoral phase which is a stepping-up of what we are already
doing. But I recommend against the suborning operation in the post-
electoral phase. That is too dangerous, too antithetical to the concept of
our general policy and of dubious effectiveness.
What I would surely recommend is that we analyze more rigor-
ously the consequences of an Allende victory, the probable develop-
ments and what could be done about them.
40. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, June 26, 1970.
SUBJECT
Chilean ElectionsAnother View
My memo of June 23
2
commented on Korrys proposal for political
action funding which is now up for consideration.
3
This memo is intended to suggest a line of analysis that has not, to
my knowledge, been surfaced in this context.
So far everyone has focussed on the immediate problem of the election
and the objective of keeping Allende from being elected. But achieving
that objective does not automatically get us out of the woods; in fact, it might
only give us a worse problem later. The point is that what happens to
keep Allende from being elected is important in the long run, and could
be good or bad.
Next to no thoughtto my knowledgehas been given to the
long term problem and trend in Chile, and therefore to the perspective
of operating now in terms of the long-range. The long-term problem is
two-fold; (a) the center of political gravity in Chile is left of center; and
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. Sent for information.
2
Document 39.
3
Document 35.
378-376/428-S/80023
108 Foreign Relations, 19691976, Volume XXI
(b) there is no existing political force of reasonable permanence that can
preempt the Communists/Socialists base on a sustained basis except
the Christian Democrats.
Keeping the Communists/Socialists out of elected power over the
long-range depends on one or more of several things happeningero-
sion of the Communist political base; existence of strong competitive
non-Communist political parties; and/or forging of a viable center-
right political party (which is difficult now because of (a) above and be-
cause there is no good nucleus at the moment).
There is an easy assumption that Allesandris election would be best for
us, based on the superficial circumstance that he is moderate, conserva-
tive, well-known and has come to be thought of as representing sta-
bility. But I posit the hypothesis that Alessandris election might be the worst
anti-Allende solution for us from a long-run point of view, even though
satisfactory for the time being.
Alessandri represents no political movement or force; he would be
elected as a person and on a personalistic basis. He can therefore be no
more than a temporary bulwark. He is old (in his seventies) and Korry and
Frei describe him as having extraordinary debilities, intellectual as
well as physical. Korry says (Santiago 2361):
4
He has no program; he has no organization; he has no under-
standing of modern problems, not even what the threat of the Marxists
represents; he is consumed by a desire to vindicate his actions in his
previous administration and to avenge the barbs and the triumphs of
the Christian Democrats . . .
If all that is true, it seems to me that an Alessandri administration
might well make a Communist victory in 1976 inevitablefor it would
hardly seem able to construct the kind of political base and force that
could compete with and preempt the Communists over a sustained
period.
One of two things seems likely to happen under Alessandri:
He would be inept; cause the discontent to swing left and either
lead to greater electoral victories by the far left or (less likely) to a mili-
tary government, which in Chile would have a hard time sustaining it-
self except by repression; or (and most likely)
The Communists/Socialists would make a political deal to support Al-
essandri in the Congress in return for a free hand to eliminate the Christian
Democrats politicallyan end Alessandri is likely to support. If this oc-
curred it would give the Communists an electoral advantage in 1976
and perhaps fatally weaken Freis baseFrei being the only person
4
Telegram 2361 from Santiago, June 24. (National Archives, RG 59, Central Files
197073, POL 151 CHILE)
378-376/428-S/80023
January 1September 4, 1970 109
with the charisma to unite the country against Allende in the next
election.
All of this suggests rather tentatively that we should think of an
anti-Allende course that would have its positive side. Perhaps we should
aid Tomic to at least come in second. With Alessandri slipping anyway,
this would have the advantage of strengthening Tomic to pick up the
defection from Alessandri rather than Allende; a Tomic victory or
better still a second place over Allende would be satisfactory to us.
Thus, if we combined a political action plan of anti-Allende activ-
ities with pro-Tomic funding, we might increase the effectiveness of
our effort.
41. Memorandum for the Record
1
Washington, June 27, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 27 June 1970
PRESENT
Mr. Kissinger, Mr. Packard, Mr. Johnson, and General Cushman.
Mr. Mitchell was unable to attend.
Admiral Thomas H. Moorer, Mr. Thomas Karamessines, and [name not
declassified] were present for all items.
Mr. William Broe was present for Items 1 through 4.
Mr. John Hart was present for Item 1.
[Omitted here is discussion unrelated to Chile.]
2. ChilePolitical Action Related to 1970 Presidential Election
a. Mr. Broe outlined what had been done so far in the Chilean elec-
tion campaign and what the current situation was as election day ap-
proaches. He went on to describe the Korry proposals which, those
present agreed, were really two separable concepts.
b. At the present time, the Chilean Congress divides as follows: for
Alessandri, 43; for Tomic, 75; for Allende, 82.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only. Drafted by Jessup on June 29. Copies were sent to Mitchell,
Packard, Johnson, and Helms.
378-376/428-S/80023
110 Foreign Relations, 19691976, Volume XXI
c. The most recent poll, which is 99% complete, shows the voters
leaning toward Allende 28.4%, Tomic 29.9%, Alessandri 35.6%, and the
remainder undecided. If a clear majority is not obtained, under the
Chilean constitution the two highest vote-getters are dumped into a se-
lective process by the Congress.
d. Mr. Broe indicated that Alessandri was slipping and was con-
ducting a campaign based on the past; Tomics program lacked clarity
for the Chilean voter; Allende seemed to be gaining a head of steam
with an attractive package of promises for the have-nots.
e. Mr. Kissinger, the Chairman, wondered why more active sup-
port of Tomic would not cause the most damage to Allende.
f. Mr. Broe replied that ground rules in Chile had prevented our
dealing with Tomics Christian Democratic Party mechanism, [1 lines
not declassified].
g. Mr. Johnson said that Messrs. Meyer and Crimmins from ARA
were negative on both Korry proposals and that he himself had philo-
sophical reservations. In these times when we are getting away from
traditional election management, he compared Chile to the Italian situ-
ation where there was plenty of money within the country if it would
only mature politically. The Chairmans comment was, I dont see why
we need to stand by and watch a country go communist due to the ir-
responsibility of its own people.
h. It was agreed following the lengthy exchange of views: (1) to ap-
prove Part 1 of the Korry proposal for the infusion of $300,000 more for
anti-Allende activity, and (2) to defer any decision on the buying of
congressional votes should the election go to Congress; [1 lines not de-
classified]. The risks in eventually embarking on this course were ap-
parent and no action would be undertaken without further delibera-
tions by the 40 Committee.
i. The critical indicator for Korrys second proposal would be, if at
the end of the election, Alessandris margin fell below 5%.
j. The Committee will keep close watch on Chilean developments
from now until September.
[Omitted here is discussion unrelated to Chile.]
378-376/428-S/80023
January 1September 4, 1970 111
42. Telegram From the Department of State to the Embassy in
Chile
1
Washington, July 2, 1970, 2321Z.
106100. For Korry from Meyer. Analysis Note: In accordance with
arrangement made by Mr. W. Deary of INR with Mr. T. Eliot of S/S on
July 2, 1970 give all copies of this telegram to INR/DDC, on July 3,
1970. The duty officer in INR/DDC (R. Berg) will give a copy to Mr.
Eliot. Thank You, A.E. Wellons, INR/DDC on behalf of Amb. W. Coerr.
1. So that you will have full background, I want you to know that
we in ARA, and the Dept as a whole, recommended against approval of
both Phase 1 and Phase 2 of your proposal for political action.
2
2. Among other considerations, we gave more weight than you did
to the exposure potential and less weight to the protective attrac-
tiveness of being able to say we had done something. We also were
influenced by the fact that we will be doing something which Chileans,
who have ample resources and a great stake in the outcome, should
themselves be doing. We also took account in this complex equation of
the uncertain effectiveness of the effort; the probability that, from the
standpoint of our interests in Chile, all three candidates would be nega-
tive sooner or later; and the certainty that exposure would destroy any
prospect of mitigating Tomic or Allende post-election attitudes. In
brief, we believed that the potential gains were outweighed by the po-
tential costs.
3. Although our negative recommendation covered both phases,
we hadand haveparticularly strong concerns about Phase 2. I want
to reiterate the point at the end of the earlier message through CAS
channels.
3
Unless and until Phase 2 is authorized, no one in the Em-
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile Chronology 1970. Secret; Roger Channel. Drafted by Crimmins; approved
by Coerr. A stamped notation on the first page reads: Special Handling.
2
For Korrys proposal, see Documents 35 and 39. In a memorandum to U. Alexis
Johnson, June 22, Coerr presented both Korrys arguments and his own arguments
against political action in Chile. Exposure would have highly negative effects on US in-
terests in Chile, he explained, where sensitivities to charges of CIA intervention are al-
ready aroused. In an addendum to the memorandum, Coerr added: 4:45 PM, June 22,
1970Meyer and Crimmins of ARA joined DDC briefing of Johnson. Johnson said we
had been cutting down on this type of U.S. activity and he had considerable concern over
Ambassador Korrys proposal. He asked Meyer and Crimmins if they wished to defend it
to him, and they said NO. Unanimous agreement against Phase B. Meyer didnt like
Phase A either, because he thought it would be too noticeable. General, although not de-
finitive, opposition to Phase A. (Department of State, Bureau of Intelligence and Re-
search, INR/IL Historical Files, Chile Chronology 1970) For the subsequent decision by
the 40 Committee on June 27, see Document 41.
3
Not found.
378-376/428-S/80023
112 Foreign Relations, 19691976, Volume XXI
bassy should deal with anyone outside the Embassy, including Frei, on
any aspect of Phase 2. This prohibition encompasses the setting up or
conditioning of anyone, including Frei, for an eventual role in car-
rying out Phase 2. The Phase 2 proposal is just too explosive for any
risks to be taken at this time.
Johnson
43. Telegram From the Embassy in Chile to the Department of
State
1
Washington, July 6, 1970, 2208Z.
2526. For Asst Secy Meyer from Korry.
1. Your 106100
2
via Roger Channel was received July 4th. This for-
tuitous coincidence provided time for reflection and a well-considered
reply.
2. Because of the wide gap between your views and those ex-
pounded by me, I have instructed (without further explanation) the
CAS to hold in abeyance the implementation of the 40 Committee deci-
sion pending further consultation with you. I have done so because of
my conviction that for such a delicate operation to be executed most ef-
ficiently there must be a modicum of mutual confidence. In setting
forth that general goal, I want you to know that we too agonized over
the alternatives, that we too had grave doubts, that we too recognize
there are risks and that we do not advance any doctrine of omnipotent
infallibility.
3. Incidentally, the proposals I put forward are not strictly mine.
3
They represent the unanimous view of all here who had to be con-
sulted. I accept, of course, full responsibility as the US representative in
Chile. It is precisely because I hold that privileged position that I have
concluded that I cannot implement a policy that has aroused such
strongly expressed opposition after the Committee of 40 has taken its
decision. While I am the Presidents representative, I also depend in the
first instance on your support and understanding. Without such confi-
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile Chronology 1970. Secret; Immediate; Roger Channel. A stamped notation
on the first page reads: Special Handling.
2
Document 42.
3
See Documents 35 and 39.
378-376/428-S/80023
January 1September 4, 1970 113
dence, the self-assurance that makes for leadership is undermined to
such a degree that an undertaking of the import of the kind we are dis-
cussing is indeed jeopardized at the outset.
4. Tactics is not the issue. At no time have I or anyone else here con-
sidered a direct or indirect approach to Frei or anyone else about Phase
II until approved as specified in our proposal. I thought that our orig-
inal proposal to the 40 Committee had made that clear.
4
5. What is extremely unsettling is the wide breach between us over
objectives. Our viewand it is the unanimous viewof the entire CTis
that the election of Allende would be the triumph by democratic elec-
toral means for the first time in history of a Communist govt. We have
consistently set forth this view without challenge from Washington at
any time heretofore, and by happenstance, our President on July first in
his nationwide TV hour made the point twice unequivocally that no
Communists had ever assumed power by democratic means. It would
not rpt not be stretching matters, I submit, to say that the President
built much of his 50 minute argumentation on the general Asian subject
around this fact.
5
6. If, at any time previously our central thesis that the election of
Allende would signify the imposition in Chile of a Communist regime
of either the Castro or Ulbricht variety had been challenged, we would
have done our best to persuade you of the contrary but would have
ceded to your judgment and to your decision. But because we assumed
general agreement on this point and because we anticipated the Presi-
dents arguments as they applied here, we decided with great reluc-
tance that the Allende chances of victory were so strong that we had to
bite the main bullet.
7. Hence we appear to differ over your view that all three candi-
dates would be negative sooner or later since we feel that the negative
aspects of one transcend the other two and the election of one would
have repercussions far beyond Chile, as President Nixon implicitly
recognizes.
8. From this central difference flows a subordinate one of equal sig-
nificance. Whereas you state the exposure would destroy any pros-
pect of mitigating Tomic or Allende post-election attitudes we unani-
mously hold that there is literally nothing the US can do that can
mitigate Allendes attitudes. This is not to say that we should deliber-
ately seek to justify those attitudes by imprudences so that his govt
would better justify its actions. It is to say that Allende intends, as he
4
See Document 35.
5
Nixons July 1 interview was broadcast on ABC television. See Public Papers:
Nixon, 1970, pp. 543559.
378-376/428-S/80023
114 Foreign Relations, 19691976, Volume XXI
said in a speech a few nights ago here, to cooperate fully with Castro to
set in motion throughout Latin America a revolutionary tide. There is
ample evidence as to the depth and sincerity of Allendes determina-
tion to effect this true revolution that would in the first instance be
aimed at eliminating meaningful US public and private presence and
influence.
9. Concerning exposure which is our very real concern too, I hope
that a brief recapitulation of our relationships [less than 1 line not declas-
sified] and with those with whom we must deal sub rosa will serve to
clarify some of your merited apprehensions: [name not declassified] was
a full party to the Anaconda nationalization negotiation yet the only
leak that occurred during those delicate weeks and to this date was
from a well placed State Department official as I reported near the end
of those negotiations. [name not declassified] and [name not declassified]
were parties to the frenetic and high risk Arguedas affair here and there
has never been a hint of leak from their end. [name not declassified] more-
over, is a man who, as I was briefed before coming here, shrinks from
decisive tests of strength. Hence when in January 1968 I had to condi-
tion him to fight for the liberty side of his revolutionary party,
6
the
White House by letter approved that action with the full knowledge of
State. And again under this administration when I conditioned Frei for
another such test of strength in his party last year by sending him a
copy of Solzhenitsyns The First Circle, the only reaction I had from State
was approval. Thus I am puzzled by the injunction to eschew condi-
tioning in this instance, particularly after it has been achieved and
after a Committee 40 decision has been taken and after we specified
that there would be no direct or indirect approaches to Frei by US per-
sonnel re Phase II even if that proposal were approved. Frei has been
hammering the liberty theme in recent weeks (again during his
northern tour which ended today) in an effort to help Tomic rpt Tomic.
And the Vice-President of the PDC, Jaime Castillo, the leading ideo-
logue of Christian Democracy, has publicly just characterized what the
Communists call the campaign of terror as a campaign of truth.
[6 lines not declassified], as I am sure you will appreciate. The condi-
tioning you abjure was done to place the great prestige of Frei and his
closest supporters in tandem with our principal goal of stopping Al-
lende and to reduce the exposure factor to the lowest possible level.
10. As for Tomic and his attitude, we have said nothing different to
him than to Frei or to anyone else that inquired. We have told them that
we believed Allende was a very potent candidate, that the Communists
would not rpt not vote for Tomic and that they would not abandon the
6
See Foreign Relations, 19641968, vol. XXXI, South and Central America; Mexico,
Document 298.
378-376/428-S/80023
January 1September 4, 1970 115
Socialists to cooperate with a Tomic govt. The only PDC complaint that
we have ever had was and is the periodic needle from Gabriel Valdes to
me and to the DCM (and spread in PDC circles) that one of the higher
ARAofficials in Washington was openly Alessandrista. (I mentioned in
low key this problem during your visit to Santiago and Valdes has re-
turned to it again and again.) The fact is that the Alessandri and the
Tomic camps believe we are neutral with a possible bias towards
Tomic. The proof is in the recently propagated Tomic brochure that
states categorically as we reported that the US is a friend and an honest
one. The point is that anti-Allende propaganda is not rpt not regarded
by the PDC as harmful and that it could, as I stated originally, help
Tomic as well as Alessandri in the election.
11. My belief today is that Allende is at least a strong second if not
first. This view is shared in the PDC by all except Tomic and by ev-
eryone in the Alessandri camp. The Communists are now certain, we
know, that Allende will run at least a strong second to Alessandri and
they believe this will make very likely his Presidency and the destruc-
tion of the center of Chile. If they succeed in having an effective general
strike on Wednesday this week, the Allende momentum will gain al-
though there will be a backlash effect as well.
12. As for money, I grant you that if the Alessandri campaign had
been properly organized and executed, there would be no rpt no need
for this discussion. But we must deal with the real world which is quite
different. Tomic has all the funds he can possibly use, yet Frei must do
for him what we are trying to do for our interests in the same way. To
say Tomic, Alessandri and their supporters should be doing some-
thing will not make it happen. We waited long enough to confirm they
will not do it and that the threat we feared had materialized. More im-
portantly, we are in possession of significant information from many
quarters starting with the Communists that the anti-Allende truth
campaign is effective and that it is the only instrumentality that does
him harm at the voter level. (We shall be reporting regularly on this
aspect.)
13. Having assumed that our President and all his advisors would
wish to oppose an electoral triumph of a Communist candidate (which,
whatever the label, he is) because it would be harmful to the interests of
the US, we had, I sincerely believe, no choice than to have done some-
thing. Indeed I would be derelict if I did not do something once I as-
sumed that to be the view of my President and my govt.
14. It is because I now discover that the assumption was wrong in-
sofar as it concerned you and that this discovery comes after the 40
Committee has taken its decision that I am so troubled. It is not that
unanimity or conformity is an essential prerequisite to action. Indeed
unanimity is usually a danger signal and the controlled tensions of dis-
378-376/428-S/80023
116 Foreign Relations, 19691976, Volume XXI
sent are generally constructive. What is at issue now is whether we can
effectively carry out the 40 Committee decision in view of your and the
Departments strong opposition to the program. I fear we cannot and
would like to have your further comments on the problem before
making any new recommendations.
Korry
44. Telegram From the Department of State to the Embassy in
Chile
1
Washington, July 7, 1970, 2116Z.
107632. For: Korry from Meyer. Ref: Santiago 2526.
2
1. Thanks for further amplification of local situation and for cur-
rent political overview.
2. Perhaps I erred on side of frankness and incompleteness in ad-
vising you of the fact that we had recommended against the proposal,
without explaining the full development of our thought processes.
3
3. This can await a better medium of discussion than cable ex-
change, but I wanted you to know of our pre-decision position directly
from me rather than secondhand and indirectly.
4. Most important is that ARA and the Department recognize the
40 Committee decision transmitted to you through CAS channels as
binding and as authorizing execution of Phase I just as soon as you re-
ceived the text of the decision. I count on you to proceed with Phase I.
5. As you know, a decision on Phase 2 was deferred by the Com-
mittee, with authorized action confined to detailed planning by CIA
toward identifying persuadables.
4
At the same time, the Committee
recognized the risks inherent in Phase 2. My guidance to you on Phase
2 wasand isintended to emphasize the narrow limits of the action
approved by the Committee and to make sure that there was a clear un-
derstanding between us concerning the operational effects of those
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile Chronology 1970. Secret; Roger Channel. Drafted by Crimmins; approved
by Coerr. A stamped notation on the first page reads: Special Handling.
2
Document 43.
3
See Document 42.
4
See Document 41.
378-376/428-S/80023
January 1September 4, 1970 117
limits, taking into account the special risks Phase 2 represents. We have
been in close touch with CAS Headquarters on this matter, and we un-
derstand that they too have given parallel guidance to their Station.
6. There is no difference of opinion between us on the adverse con-
sequences of an Allende victory or about the importance of an Allende
defeat as an objective. The differences were principally about the de-
gree of risk we should take in an attempt to achieve that objective, con-
sidering the adverse consequences to our position in Chile and else-
where should we be caught out.
7. In any case, do not interpret honest differences in judgement be-
tween us in terms of confidence. I know that you do not expect me to
accept every recommendation on far-reaching issues that comes forth
from any Embassy any more than I expect an Ambassador to supress
differences with Washington guidance that appears to him to be un-
sound from the standpoint of his concerns in his host country.
Johnson
45. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, July 21, 1970.
SUBJECT
September 4 Presidential Elections in Chile
Ambassador Edward Korry has sent us his analysis (Tab A)
2
of
how the Presidential campaign in Chile is progressing. He estimates
that at present Alessandri may have about 38% of the vote, Allende
33% and Tomic 25%. The cable is long, but very literate and worth
reading.
According to Korry, conservative 74-year old Alessandri has been
the primary beneficiary over the past month of: (1) the increased polar-
ization in Chilean politics resulting from recent episodes of violence
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret. Sent for information. Printed from an
uninitialed copy.
2
Attached but not printed at Tab A are telegrams 2714 and 2726 from Santiago,
both July 17.
378-376/428-S/80023
118 Foreign Relations, 19691976, Volume XXI
and the consequent injection of the theme of law and order into the
campaign as a central issue, and (2) the popularity and influence of
President Frei. Alessandris recent gains have been largely at the ex-
pense of Christian Democrat (PDC) candidate Tomic, who, according
to Korry, is now increasingly held to be a poor third by all sectors.
Allende, (candidate of the leftist Popular Unity, a coalition of the
Communists, Socialists and Radicals) has been hurt by recent episodes
of violence. His supporters are divided on the question of the use of vi-
olence, and he has alienated some of his moderate supporters by the
more radical and openly Marxist posture which he has assumed
recently.
Tomic, who has equivocated on the issue of violence in an attempt
to woo the left, has also been hurt by injection of law and order as a
campaign issue. He has blundered in the management of his campaign
by attacking the popular Frei government, thereby contributing to a
widening gap between President Frei and his partys candidate (Tomic)
and platform.
Alessandri has benefitted from Freis actions to ensure law and
order and from his stress on liberty and democracy. Alessandri, who
has based his campaign on the issue of law and order, emerges as a pa-
triarchal figure of tranquility.
Korry feels that if Alessandri does not become overconfident, if
Tomic does not change his strategy, and if no chance event upsets the
present pattern, Alessandri may be able to get the sizeable vote he
needs to be named by Congress and assume office without undue diffi-
culty. There is still time for considerable shifting in the order, however,
before the September 4 elections.
378-376/428-S/80023
January 1September 4, 1970 119
46. National Security Study Memorandum 97
1
Washington, July 24, 1970.
TO
The Secretary of State
The Secretary of Defense
The Director of Central Intelligence
The Chairman, Joint Chiefs of Staff
SUBJECT
Chile
The President has asked for an urgent review of U.S. policy and
strategy in the event of an Allende victory in the Chilean Presidential
elections. The study should cover the following points:
1. What policies and goals is an Allende administration likely to es-
pouse? What probable alternative courses are developments in Chile
likely to take under an Allende government?
2. What is the nature and degree of threat to U.S. interests of these
alternatives, both in immediate terms and in terms of impact on our
long-range goals and position?
3. What options are open to the U.S. to meet these problems?
The paper should be prepared by an ad hoc group comprising rep-
resentatives of the addressees and the NSC staff and should be chaired
by the representative of the Department of State. Because of the sensi-
tivity of the subject, knowledge of the paper and participation in its
preparation should be kept on a strict need-to-know basis. Additional
participation as may be required should be specifically approved by
the chairman of the ad hoc group under these guidelines.
The paper should be submitted to the Assistant to the President for
National Security Affairs no later than August 18, 1970.
2
Henry A. Kissinger
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H047, Senior Review Group, Chile (97). Secret; Exdis.
2
The responses to NSSM 97 are Documents 13 and 14 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973. See also Document 52.
378-376/428-S/80023
120 Foreign Relations, 19691976, Volume XXI
47. National Intelligence Estimate
1
NIE 9470 Washington, July 30, 1970.
[Omitted here are the Table of Contents and a map of Chile.]
THE OUTLOOK FOR CHILE
Conclusions
A. Over the last five and a half years, President Eduardo Frei has
initiated many changes in Chilean society, for the most part designed to
enhance the status and income of the poorer classes. The next adminis-
tration, depending on its composition, may consolidate or accelerate
these changes, but it cannot sharply reverse them. Frei cannot succeed
himself and an election to determine his successor is scheduled for 4
September.
B. It is not possible to single out any one of the three candidates as
the likely winner. None seems likely to win the majority needed for di-
rect election. In that event the Congress chooses between the top two
candidates.
Jorge Alessandri, an aging and ailing conservative elder statesman
type, is still the front runner. He has the smallest bloc of supporters in
the Congress, and even if he finishes first might be passed over unless
he wins something like 40 percent of the popular vote.
Radomiro Tomic, the leftist Christian Democratic candidate,
would almost certainly be the victor in the secondary election if he fin-
ishes first, and would have a good chance if he finishes a close second.
Salvador Allende, the Socialist who is supported by an electoral
coalition strongly influenced by the Communists, must finish first in
the popular vote to have much chance of election by the Congress.
C. None of the presidential candidates is supported by political
forces that have a majority in both houses of the Congress and the next
congressional election is not scheduled until March 1973. Alessandri, in
particular, would have serious problems in his attempts to build a
workable coalition to slow down the pace of reform and to consolidate
the changes Frei has initiated.
D. There are measurable differences among the three candidates
and the kind of government they would provide. Alessandri is the only
1
Source: Central Intelligence Agency, National Intelligence Council, Job
79R01012A, NIE 9470. Secret; Controlled Dissem. According to the covering sheet, the
CIA and the intelligence organizations of the Departments of State and Defense and the
National Security Agency participated in the preparation of the estimate. All members of
the U.S. Intelligence Board concurred in the estimate except the Atomic Energy Commis-
sion and the Federal Bureau of Investigation, on the grounds that the subject was outside
their jurisdiction. The NIE is published in full as Document 11 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
January 1September 4, 1970 121
one who is well-disposed toward the Chilean private sector. The other
two, although both strongly influenced by Marxist ideology, differ
with regard to the kind of socialist state they want and the means for
achieving it. Allendes socialist state would be a Chilean version of a
Soviet style East European Communist state, secured with the help of
the Chilean Communist movement. Tomics model, on the other hand,
is Yugoslavia. He would attempt to use the present constitutional
system to impose his vaguely defined communitarian system, which
envisages state operation of Chiles basic economic enterprises.
E. While we judge that Chilean democracy is likely to survive over
the next two or three years, it will be tested in the near future and with
even greater severity over the next decade. The greatest threat to sta-
bility and constitutional order would come from the policies of an Al-
lende administration. Another threat might arise from the extra-
constitutional reactions of its opponents, including the military. No
matter who is elected, the tensions in Chilean society are likely to in-
crease before they diminish.
F. There would be strains in US-Chilean relations under either Al-
essandri or Tomic but both men appear persuaded of the value of good
relations with the US. Allende, however, would almost certainly take
harsh measures against US business interests in Chile and challenge US
policies in the hemisphere. The hostility of Allende and his allies
towards the US is too deeply-rooted to be easily changed. On key inter-
national issues, which involved any kind of an East-West confronta-
tion, an Allende administration would be openly hostile to US interests
or at best neutral.
Discussion
[Omitted here are Section I, The Record of the Frei Administra-
tion, Section II, Key Political Forces, and Section III, The Election of
4 September.]
IV. The Outlook for the Next Administration
A. General
34. The race is still so closely contested that we cannot single out
any one of the three candidates as the likely winner. There are various
factors, such as Alessandris and perhaps Allendes health, which may
influence not only that contest but also the course of the next adminis-
tration. For example, one of the key problems will be the next presi-
dents relations with a Congress which blocked and then watered
down Freis efforts to strengthen the position of the presidency in the
Chilean system. The Congress is likely to be no less recalcitrant toward
similar attempts by his successor, and by Alessandri in particular.
378-376/428-S/80023
122 Foreign Relations, 19691976, Volume XXI
35. There is almost no chance that the next president will begin his
term with the kind of mandate Frei received in 1964. None of the three
candidates is supported by political forces that have a majority in both
houses of the Congress, and the next Congressional election is not
scheduled until March 1973. Alessandri, who commands the smallest
bloc of congressional support, would probably have the most difficulty
in building a workable coalition, in part because of his longtime criti-
cism of the Congress and his efforts to strengthen the Executive
Branch.
2
Allende and Tomic would face lesser but still formidable
problems, unless either was able to make operative Tomics proposal
for a grand coalition of the Christian Democratic, Communist and So-
cialist movements. The more likely prospect is that whoever heads the
next administration will have to try and find congressional support for
his programs on a measure by measure basis. Given the intense polit-
ical partisanship that has been generated in the current campaign, the
Congress may not even follow its past pattern of granting a new ad-
ministration special powers (for a limited time) to cope with its imme-
diate problems.
36. At least initially, the next president will have the benefit of a fa-
vorable financial situation. Copper earnings probably will continue
their previous upward trend through 1970 and 1971, though the rate of
growth may be slowed by declining copper prices.
3
After that the next
administration probably will have to adjust to a leveling off or possible
decline in export earnings, little or no new investment by US copper
companies, and, at least, a declining net inflow of foreign assistance as
repayments more nearly offset new drawings. The ability of Chile to
handle these problems will depend greatly on the political complexion
of the new administration and the manner in which its policies are car-
ried out, particularly regarding the nationalization of copper and other
industries. Similarly, the course of economic and political develop-
ments on the domestic scene will be strongly affected by the next ad-
ministrations policies regarding such issues as agrarian reform, redis-
tribution of income, and the role of the state in the society. Even with a
continued favorable copper market, the next administration will en-
2
The next administration could make use of a recent constitutional amendment
which will enable it to call a national plebiscite if the Congress rejects a constitutional
amendment sought by the Executive Branch. This, however, involves the risk of a defeat
which would further weaken a presidents position vis-a`-vis the Congress. [Footnote is in
the original.]
3
Because of the US-copper companies expansion program, the output of the large
minesmainly for exportis expected to rise from 550,000 metric tons in 1969 to 850,000
metric tons in 1971. Under the system imposed by the Frei administration on the large US
companies in 1969, the effective tax rate on these sales now averages 85 percent. [Foot-
note is in the original.]
378-376/428-S/80023
January 1September 4, 1970 123
counter problems in maintaining present social welfare programs, let
alone expanding them as Allende and Tomic have promised.
37. There are measurable differences among the three candidates
and the kinds of government they would provide. Alessandri is the
only one who is well disposed toward the Chilean private sector. The
other two, though socialists, clearly differ with regard to the kind of
socialist state they want and the means for achieving it. Allendes so-
cialist state would be a Chilean version of a Soviet style East European
Communist state supported by the popular unity of the masses and
rulingat least theoreticallyin their interests. Allende owes his selec-
tion as the candidate of the UP to the Communists, and he would also
be heavily dependent upon them in carrying out his programs. He
would move cautiously, as his Communist allies have long advocated,
in changing the present political system. Nonetheless, he would exploit
to the hilt the means at hand for pressing forward with the socialization
of the economy, with the aim of destroying the economic bases of his
political opponents and establishing tight control over the press, radio
and television.
38. Tomics model is Yugoslavia, with which he has ideological
sympathy as well as personal ties. He would attempt to use the present
constitutional system to impose his vaguely defined communitarian
system, which envisages state operation of all of Chiles basic economic
enterprises. Workers would share in the direction and profits of these
enterprises and of the smaller ones left in private hands. In contrast to
Allende, a wily political opportunist who already has Communist sup-
port, Tomic is a sincere idealist who is still bidding for it. He has repeat-
edly insisted that, in order to carry out his blueprint for the socializa-
tion of Chile, he must have the cooperation of the countrys Marxist
parties; despite the obvious distrust with which the Communists re-
gard him, Tomic has managed to keep open his lines of communication
with them. While he would attempt to work through the constitutional
system, Tomic has authoritarian inclinations. He has said that if
elected, he would brook no interference with his plans for solving
Chiles problems. Unlike Allende, however, he would be operating
under the restraints imposed by the sector of the PDC most responsive
to Frei. This sector strongly supports the Chilean tradition of a rela-
tively open society in which freedom of the press and individual lib-
erties are respected.
B. Under Alessandri
39. Alessandri would attempt to consolidate the changes intro-
duced under Frei by slowing the pace of reform and restoring the confi-
dence of the private sector of the economy. He apparently realizes that
agrarian reform is irreversible but would try to carry it out more effi-
ciently and to make it less of a partisan political issue. Such a policy,
378-376/428-S/80023
124 Foreign Relations, 19691976, Volume XXI
however, would not only be opposed by many in the PDC and UP who
wish to push ahead but would cost him support within the PN, some of
whose members want to turn back the clock. On the matter of nationali-
zation of the holdings of the US copper companies, Alessandri has
pledged to honor the present accords, but he is capable of reversing
himself should it prove politically expedient. In any case he would try
to avoid precipitous action, such as expropriation without negotiating
compensation.
40. Alessandri would be more cautious than either Allende or
Tomic in his foreign policies. He would maintain the recent tendency in
Chilean foreign policy to stress independence of US leadership and to
urge Latin American unity in dealing with the US on hemispheric
problems, particularly economic ones. He has grumbled that his pre-
vious administration broke relations with Cuba under heavy pressure
from the US. There has been a recent limited renewal of trade between
Chile and Cuba, which is supported by right-wing agricultural in-
terests as well as leftist ideologues. He probably would go along if the
Congress urged that restoration of diplomatic relations follow.
41. The activists on the far left are more likely to step up the level of
their disruptive tactics against an administration headed by Alessandri
than against one headed by either of the other two candidates. This
could lead to a polarization between extremes of the left and right, par-
ticularly if Alessandri were not able to control the extremists among his
own followers. Under such conditions certain military leaders might
begin coup plotting; the unrest and dissatisfaction in the army, which
surfaced in October 1969, indicate that it can no longer be depended
upon to eschew direct intervention in national politics. The chances of
such intervention would be affected by the degree of unity among the
key military leaders and their estimate of the reaction of the Cara-
bineros. In the event of Alessandris death or incapacitation, the secu-
rity forces would probably support the Minister of the Interior in
holding elections to determine the succession.
C. Under Tomic
42. Tomic has promised to accelerate and to expand the reforms
initiated under Frei. To do so he must go to the Marxist left, which
might involve attempting to bring the Communists and Socialists into
his administration. The Socialists would be likely to refuse. The oppor-
tunities for the Communists would be so attractive that they would
probably be persuaded that it was in their interest to cooperate with
Tomic in carrying out the non-capitalist way. While Tomic would be in
a better bargaining position in dealing with the Communists than Al-
lende is, the price would still be high.
43. Tomic has emphasized increased control of the economy by the
state, and it is clear that if he won the role of both domestic and foreign
378-376/428-S/80023
January 1September 4, 1970 125
private enterprise would be further reduced. In view of his reiterated
intention to proceed quickly with complete nationalization of the re-
maining holdings of the US copper companies, foreign investors would
delay new investment until that issue was resolved and would be influ-
enced by the way Tomic handled it. They would also be responsive to
the style and content of Chilean foreign policy which, since Tomic has
declared his intent to renew diplomatic relations with Castros Cuba,
would probably be at least as aggressively independent under Tomic
as it has been under Frei. Tomic, like Frei, would have difficulty in both
satisfying the expectations of his followers and keeping inflation under
control.
44. Agrarian reform would be a sensitive issue for Tomic. He has
promised to press forward rapidly on land distribution but any marked
speed-up in the present pace would almost certainly encounter deter-
mined resistance fromthe smaller as well as the larger landholders. The
way in which Tomic sets about fulfilling campaign pledges such as this
one would be a determining factor in developments over the next two
or three years.
D. Under Allende
45. An Allende administration would proceed as rapidly towards
establishment of a Marxist-Socialist state as the circumstances per-
mitted. Allendes rejection of the capitalist system is even more cate-
gorical than Tomics and rather than negotiating compensation for
expropriated properties, Allende promises to pay only what the gov-
ernment deems appropriate. He would move quickly to expropriate
not only the copper mines and other properties with foreign owner-
ship, but also the private banks and other important elements of the
private sector with little, if any, compensation. Allende would substan-
tially expand the present social welfare services, in part to fulfill his
campaign promises but also in the expectation of attracting a greater
popular following.
46. In the political arena, Allende would be likely to move cau-
tiously in carrying out drastic changes in institutions, at least for the
first year or so, because of the likely adverse reaction of the security
forces. While an open breach of the constitutional process or a direct at-
tack on the armed forces institution would provide the impetus for a
military coup, in an ambiguous situation that called for carefully
graded responses the military leaders would find it difficult to unite
and to act against the administration in power. Thus we think Allende
would follow tactics designed to give him time to bring more coopera-
tive officers into key military and police posts and to develop a much
wider popular base than he now has. In such a situation the Commu-
nists would have opportunities to extend their influence throughout all
levels of the Chilean Government and society, in pursuit of their goal of
378-376/428-S/80023
126 Foreign Relations, 19691976, Volume XXI
an eventual takeover of power. Allende undoubtedly expects that
progress on basic bread-and-butter issues will afford him an opportu-
nity to secure control of the Congress in the 1973 elections and thereby
enable him to impose a socialist state of the Marxist variety by the v a
pac ficaas his Communist allies have long advocated.
47. If Allende were to move adroitly enough he could take Chile a
long way down the Marxist Socialist road during the six years of his ad-
ministration. He would, however, have to surmount some important
obstacles. These include the necessity of bringing the security forces to
heel, of obtaining congressional support to carry out the initial phases
of his program, and of keeping the UP coalition together. He would
also encounter resistance from the moderate and conservative elements
of society, from the Catholic Church and some segments of organized
labor, and particularly from the sector of the Christian Democratic
movement that responds to Freis leadership. Timely and effective re-
sistance by the latter groupings, however, would be handicapped by
the many divisions and uncertainties which would exist among them.
E. In Sum
48. Chile is not a banana republic, but a country with deeply in-
grained democratic traditions. These are not only under strong attack
from leftist extremists but from rightist elements as well. While we
judge that Chilean democracy is likely to survive over the next two or
three years, it will be tested in the near future and with even greater se-
verity over the next decade. The greatest threat to stability and consti-
tutional order would come from the policies of an Allende administra-
tion. Another threat might arise from the extra-constitutional reactions
of its opponents, including the military. No matter who is elected, the
tensions in Chilean society are likely to increase before they diminish.
V. Implications for the United States
49. Although an Allende administration would provide the most
intransigent problems, there is scant solace for the future of US-Chilean
relations, no matter who succeeds Frei. The trend towards more inde-
pendence of the US is too deeply set to be easily reversed; that was ap-
parent under Frei, who nonetheless went out of his way to maintain
close and friendly relations with the US. There would be problems for
US-Chilean relations under either Alessandri or Tomic but both men
appear persuaded of the value of good relations with the US, and prob-
ably expect a continuation of US assistance. If Tomic followed through
on his promise to negotiate settlement for nationalization of the US-
owned copper holdings, as Alessandri probably would, that issue
could be kept manageable. The differences between Tomic and Ales-
sandri in a so-called independent foreign policy would almost certainly
be of degree not of kind. On key issues in the UN, and in the event of an
378-376/428-S/80023
January 1September 4, 1970 127
East-West confrontation, both Tomic and Alessandri would either sup-
port the US or, at worst, remain neutral.
50. If Allende wins, the problems created for the US would be
much greater. These would arise from measures taken against US
business interests in Chile which would likely be compounded by
statements and actions both abrasive to the US and challenging to US
policies in the hemisphere. Allendes use of the tactics of confrontation,
particularly as the Congressional election of March 1973 approaches,
could set events in motion which would lead to an open break with the
US. We do not believe, however, that Allende would deliberately seek
such a break over the next two years or so.
51. The problems created by an Allende administration in its con-
duct of foreign policy would be extremely difficult to manage. They
would involve the strains inherent in a situation where an Allende vic-
tory would be hailed by anti-US forces and others as a set-back for US
interests, not only in Chile but throughout the hemisphere. An Allende
administration would pose a serious challenge to US efforts at securing
hemispheric cooperation on a wide range of issues. For example, Al-
lende may be expected quickly to normalize relations with Cuba, and
might well withdraw from the OAS. At the same time Chiles relations
with Argentina probably would deteriorate because of Chiles in-
creased ties with Communist countries. Finally, the hostility of Allende
and most of his allies in the UP toward the US is too deeply-rooted to be
easily changed. When key issues in the UN, or in world affairs gener-
ally, involved any kind of an East-West confrontation, an Allende ad-
ministration would be openly hostile to US interests or at best neutral.
378-376/428-S/80023
128 Foreign Relations, 19691976, Volume XXI
48. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, August 4, 1970, 2100Z.
2979. For Asst Secy Meyer from Korry.
1. Before addressing myself in other channels to critical questions
in NSSM contingency paper
2
(on which I am awaiting cable per my
Washington conversations last week) and to phase two possibilities, I
must confess my conviction that such cerebrating is largely meaning-
less because of the restrictions the Department has imposed. Perhaps I
am interpreting your guidelines too stringently and the purpose of this
message is to get some clearer sense of what is tolerable and what is
not.
2. The central figure between Sept 4th and Oct 24th will be Frei. By
direction or indirection he can exercise very significant and perhaps de-
cisive influence over his party, over the military, and over public
opinion. The manner in which he chooses to affect these crucial sectors
is central to the most basic if unstated question of the contingency
paperhow to stop Allende from becoming or remaining President.
And that is, of course, what Phase Two is all about.
3. The injunction is: no one in the Embassy should deal with
anyone outside the Embassy including Frei on any aspect of Phase
Two. This prohibition encompasses the setting up or condi-
tioning of anyone including Frei for an eventual role in carrying out
Phase Two.
4. We have adhered scrupulously to this prohibition. You will have
noted, I am sure, Santiago 2881,
3
para 5 which reports my total rejection
to the attempt by Perez Zujovic to draw me into a discussion of possible
military intervention of some kind. I have taken other (reported) ac-
tions to keep the US in the public posture of treating all candidates
even-handedly. Thus far US media in its totality and the Chilean media
with the expected exception of the Marxists-Leninists have kept us out
of the campaign and even the Allendistas are focusing on US com-
panies rather than the USG.
5. But the fact remains that there is no rpt no way that I can realist-
ically address myself to Phase Two or to contingencies without
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile Chronology 1970. Secret; Priority; Roger Channel. A stamped notation on
the first page reads: Special Handling.
2
See Document 46 and footnote 2 thereto.
3
Not found.
378-376/428-S/80023
January 1September 4, 1970 129
knowing Freis thinking. There is no practical way of gaining essential
insights by playing the role of an innocent observer. Politics, said Lord
Cecil, are impossible to follow unless you are in constant touch with all
their developments. It is to fly in the face of this self-evident dictum to
eliminate the most knowledgeable by far politician in the country and
the man who holds all the decisive levers.
6. I am in full accord with your concerns about the manifold
dangers of exposure to the United States. I can only assure you that I
would not run risks that would jeopardize the US; I can only cite as evi-
dence my performance of the past eight years as Chief of Mission to
support that general assurance. In dealing with the Anaconda negotia-
tions last year, which were not quite as explosive as this issue, my
critical decision came when the direct talks between GOC and com-
pany were heading for breakdown and public confrontation. At that
point I went to Frei. I did not rpt not go to seek to negotiate with him;
rather, it was to get his appreciation of the situation including what role
he would prefer I play and with whom.
4
7. I am not suggesting an analogous scenario. But I am emphasiz-
ing that paper exercises have no validity unless they are based on the
real world. To run through hypothetical contingencies without know-
ing the true intentions of the controlling figure is not only intellectually
dishonest but it courts real disaster in that it raises the possibility of
Washington decisions based on the logic of what should be as distinct
from what is.
8. It may be suggested that we have other instruments for as-
sessing the situation. My experience of the past three years leads me to
an opposite conclusion. As a consummate politician Frei convinces
every visitor to his office that he agrees with them which is one reason
he is so extraordinarily popular now. And the quasi-totality of Chilean
military and politicians, with the notable exception of the Communists,
have a political perception level that is so mediocre that only fools
would tread on their projections of Freis intentions. Churchill said that
true genius resides in the capacity for evaluation of uncertain, haz-
ardous and conflicting information. I would have to aspire to far more
than genius to evaluate and to recommend while isolating myself from
the most essential information and to offer appreciations uniquely
based on the most hazardous of information.
9. It will again be suggested that I am an activist who proposes
action for the sake of action. Let me dispose of this kind of type-casting
in which the Dept invariably indulges and which is at the root of the
troubles flushed out in some of the recent task forces. The report I did
4
See Document 9.
378-376/428-S/80023
130 Foreign Relations, 19691976, Volume XXI
on Africa converted US policy from activism to restraint;
5
the low pro-
file arguments I made to the previous administration from here and
which I have executed here are the antithesis of activism;
6
the paper I
did for UnderSec Richardson on the future relationships of the US with
the LDCs was criticized for its retreat from helter-skelter activism;
7
the
recommendations I have been discussing for the sharp reduction in of-
ficial US presence here is being opposed by bureaucrats who want to be
active in everything. Neither low profile nor the careful matching of
real US interests to US resource availability was intended to be pas-
sivism. A Chief of Mission should bide his time and his resources for
those rare occasions when US interest is very definitely at stake. I be-
lieved and I believe that the election of Allende is very possible and that
it will have tremendous impact on US interests in Latin America and
elsewhere; I believed that the highest levels of the USG would also
come to that conclusion; I believed and I believe that the USG did not
rpt not have to become involved in any great effort to elect another can-
didate and we have not. Therefore I do not rpt not see any conflict be-
tween Phase One or Phase Two and my comments on Parkinsons pitch
to you.
8
10. A final word about conditioning. For me that word has only
one meaning insofar as Frei and the present problem is concerned. It
was and is to make Frei feel that he has an awareness of history, that he
consider most carefully the judgement of history if Chile were to lose its
freedom for a long stretch. Obviously a President of his stature, of his
acuity and of his devotion to democracy, will consider historys judg-
ments without prodding. But the pressures to accept the democratic de-
cision of an Allende Presidency are no less strong than the pressures to
prevent Chiles conversion into another Cuba. As the US Ambassador I
happen to be one of the few people with whom he can discuss such
questions dispassionately and whose responses he considers very care-
fully. But it has to be a discussion not a deadpan interview in which I
seek information and give nothing. I would guess that he is puzzled by
our passivity; I would guess too that it is weakening his never-strong
capacity for action; I would also hazard the incidental judgement that
the US aloofness is serving to encourage Valdes in his Cuba policy for it
reinforces the feeling that the US no longer gives a damn what happens
in Chile. Now there are safe ways of transmitting to Frei my interest.
5
For Korrys report on Africa, see Foreign Relations, 19641968, vol. XXIV, Africa,
Document 215.
6
For Korrys reports on Chile to the Johnson administration, see ibid., vol. XXXI,
South and Central America; Mexico.
7
See ibid., 19691976, vol. IV, Foreign Assistance, International Development,
Trade Policies, 19691972, Document 124.
8
See Document 32.
378-376/428-S/80023
January 1September 4, 1970 131
And that is what I had in mind when I talked on this channel of the
question of confidence.
9
11. I have indulged in frankness and wordiness because I want you
to understand the problems we have in responding to the NSC and to
the Phase Two requirements. I did not wish to refer in other channels to
the gutting nature of your inhibitions without checking back with you
first. Hence I seek your counsel and request your approval to permit
me and me alone (while all your ground-rules would continue to apply
to all others in this Mission) to try to determine directly from Frei what
are his real intentions. Because I shall, of course, wish to make such
soundings in the most subtle manner possible, there may be indirect
methods of communications between us in the interim. I wish to reit-
erate that there will be no rpt no risks of any kind since there will be no
rpt no suggestions of any kind offered by me without further consulta-
tion with you. The purposes will be to elicit information via a logical
and justifiable expression of interest in Chiles future.
Korry
9
See Document 43.
49. Memorandum for the Record
1
Washington, August 7, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 7 August 1970
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. Johnson,
Admiral Moorer, and General Cushman
Mr. William Broe was present for Item 1.
Mr. Fred Valtin was present for Item 2.
Mr. William Wells was present for Items 4, 5 and 6.
Mr. Archibald Roosevelt was present for Items 7 and 8.
Ambassador David D. Newsom was present for Item 8.
Messrs. Thomas Karamessines and Wymberley Coerr were present for all items.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only. Drafted on August 10.
378-376/428-S/80023
132 Foreign Relations, 19691976, Volume XXI
1. ChileSummary of Developments
a. The minutes of the Committee meeting of 27 June 1970
2
contains
the statement, The Committee will keep close watch on Chilean devel-
opments from now until September. In compliance, Mr. Broe brought
the principals up to date with the following observations: There was
some evidence that Alessandri had stemmed his downward trend; Al-
lende was intensifying his drive, particularly in the heavily populated
Santiago area; Tomic, still enthusiastic, was wooing the left rather than
the right. There was additional evidence that Allende was sensitive to
the attacks organized against him and was attempting to respond.
b. The country team indicated as they headed into the home stretch
that additional funds might be needed. In response to Mr. Kissingers
question as to whether phase two was, in fact, realistic, Mr. Broe
pointed out that no Americans could accurately assess the direction in-
dividuals would take should the election go to Congress. The only reli-
able way to identify the persuadables would be to confide fully in
[less than 1 line not declassified] and get their assessments based on
life-long associations, but it would be disastrous to show our hand at
this stage. The Committee would have to consider granting this au-
thority if and when the election went to Congress. Another compli-
cating factor is that the ballot would be secret.
c. Mr. Mitchell asked if American industry was participating in the
election, and Mr. Broe replied that he understood they were but their
efforts were [less than 1 line not declassified] and independent of the USG
involvement.
[Omitted here is discussion unrelated to Chile.]
2
Document 41.
378-376/428-S/80023
January 1September 4, 1970 133
50. Backchannel Message From the Ambassador to Chile (Korry)
to the Deputy Assistant Secretary of State for Inter-American
Affairs (Crimmins)
1
Santiago, August 11, 1970, 2220Z.
[message number not declassified]. For Crimmins from Korry.
1. Permit me three quick comments on the fourth option.
2
A. Since I see very little possibility of a duly-elected and inaugu-
rated Allende being overthrown, I do not regard the fourth option as
a very realistic alternative.
B. This option should be realistically considered only within the
framework of Phase Two, i.e. after the elections and prior to
inauguration.
C. The prohibitions imposed by the Dept on this Emb in dealing
with Phase Two make my following comments of dubious value since
they do not encompass firm knowledge of the thinking of key men.
2. If Allende is inaugurated by constitutional process, it is the CT
estimate that it is highly unlikely that the conditions or motivations for
a military overthrow of Allende will prevail. Military implies Army
since without the explicit or implicit support of the Army, the others
(Carabineros, Navy and Air Force) can do nothing coherent. Once
Congress elected Allende, the breakdown of law and order to a condi-
tion of chaos could be the only effective impulse for Army intervention.
For such chaos to ensue, the supporters of Alessandri would have to fo-
ment a serious and coordinated challenge to the Frei governments au-
thority and Frei would have to play the deliberate role of impotent or
conniver. While such a scenario is not impossible, it is highly unlikely
once the Congress elects Allende. An attempt to rob Allende of his tri-
umph by, say, a General Viaux, who has a certain mystique within the
Army, would in all likelihood fail in a post-congressional decision pe-
riod and be almost impossible post-inauguration unless Allende im-
prudently and unexpectedly aroused Army animus by flouting its
institutionality.
3. In considering all the permutations, three separate time frames
must be kept in view: Sept. 5 to Oct. 24 when the Congress begins its
electoral deliberations; from Nov. 4 on when Allende is President.
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile Chronology 1970. Secret.
2
The reference is to the fourth option in the August 18 annex to the study pre-
pared in response to NSSM 97. It envisioned the overthrow of Allende by the Chilean
military. The annex is Document 14, Foreign Relations, 19691976, vol. E16, Documents
on Chile, 19691973.
378-376/428-S/80023
134 Foreign Relations, 19691976, Volume XXI
4. Further assumptions re possible military influences or actions
include that Allende finishes first by a margin of less than 100,000, or
that he finishes second by less than 100,000. (If he has the first majority
by more than 100,000 it will be almost impossible for Congress to over-
turn his election and equally unlikely that intervention by anything ex-
cept death could halt his inauguration and Presidency; alternatively if
he loses by more than 100,000, he has little hope of overturning the elec-
toral order; if his forces sought to do so, it is likely they would be frus-
trated first in the Congress and if not there then possibly by military
intervention.)
5. Doubtless there are many active officers personally opposed to
the idea of an Allende Presidency. The DAO has reported his views and
[less than 1 line not declassified] has put forward the coincidental names
of Gen Valenzuela (in Santiago) and Gen Prats (the Army CG). To
which could be added Carabinero CG Huerta, FACH CG Guerratty,
Navy CINC Porta and a considerable number of other officers. How-
ever we are not considering views but the will and the capacity to act
and to control.
6. The dominant figure in the Army today is Gen. Schneider. The
Schneider doctrine of non-intervention and of acceptance of the Con-
gressional decision to name either of the first two candidates has been
widely accepted. Schneider is the one Chilean General for whom Frei
said to me he holds any respect. I am persuaded Schneider made his
controversial statement with the full knowledge if not prompting of
Frei; I am further persuaded that one purpose was to maintain the insti-
tutional unity of the Army at a difficult time (and with a Viaux in the
wings) and that this aim is increasingly understood within the Army; I
am convinced that Schneider had Tomic in mind as possible second or
Allende as a first when he issued his statement and wished to keep
open options. The FreiSchneider relationship is therefore a crucial ele-
ment about which we know little.
7. The FreiSchneider gambit to help Tomic and to keep the Army
united and apolitical has increased the pressures on the politicians who
will have to vote in Congress starting Oct. 24th. It should mean that the
Army will guarantee order until that vote starts and that it will not rpt
not permit mob muscle to disrupt the constitutional process.
8. If my assumptions about the FreiSchneider relationship are cor-
rect, then if Allende should win the first majority by less than 100,000,
the more or less united Army will assure at least an opportunity for the
Congress to block Allendes ascendancy by election of the runner up. It
is conceivable too that the Army might take certain symbolic actions
following the congressional vote to put its stamp of approval on the
newly chosen President prior to inauguration.
378-376/428-S/80023
January 1September 4, 1970 135
9. It is significant that Frei has told visitors that if Allende wins the
first majority there will be a golpe de estado (without defining if the
Armed Forces would act unilaterally or on his urging). Without any
factual substantiation, I believe this leaking to be electoral in purpose. I
guess that Frei is spreading the word in order to affect the Sept. 4th
voting and that he has calculated that both the international press and
the Marxist-Leninists here would publicize this possibility as indeed
both have. I reckon Frei believes that this propaganda-conjuring might
dissuade some disposed to vote for Allende. It could conceivably mean
what he says but I have no rpt no evidence in support.
10. The conditions that currently prevail in the Army make
doubtful any effective Army move to block Allende. While younger of-
ficers might want action for actions sake, and while some might accu-
rately calculate that such action would doubtless lead to greater re-
sponsibility, greater power and greater status, there is doubt about the
troops willingness to follow their officers for such a purpose and there
is said to be considerable Allende sentiment among the non-coms or at
the very minimum an unwillingness to obstruct him. The partisan fac-
tionalism of higher officers acts to reinforce their general reluctance
and incapacity to govern.
11. In order to reverse this outlook, a group of officers would be re-
quired to (A) plan an effective takeover without the knowledge of
Schneider or the GOC and (B) exploit a contrived or unexpected oppor-
tunity that could be accepted by a significant part of the Army and
public as a rationale for a golpe. While the Perez-Zujoviches and a good
many Alessandristas are playing with this idea, I think it a non-starter
without the blessing of Frei, implicit or explicit, and without outside
support in the form of technical assistance or political action. (We are
excluding any foreign troop hypothesis.)
12. While all sorts of Caribbean cabals can be plotted and we have
indulged in spinning some out, they strike me as fanciful and really un-
plannable because of the Armys condition and because of Chile par-
ticularities. I remain unswayed in my view that Frei is a critical and
dominant figure, not only because he is President but because he is the
most popular and therefore the most influential politician in Chile. This
judgment should not be read as implying that Frei has the guts to take
hard decisions; indeed, his proclivity is to transact and to avoid un-
pleasantness unless he is pushed.
13. That comment leads me to Phase Two. The crucial period is
Sept. 5 to Oct. 24 when various pertinent possibilities will occur:
A. If we assume Allende has won by less than 100,000, then his
supporters have a keen interest in avoiding any military intervention
that would rob them of their electoral triumph. If Tomic were second,
Allende could only be blocked from the Presidency by the Nacionales
378-376/428-S/80023
136 Foreign Relations, 19691976, Volume XXI
and/or dissident Radicals voting for Tomic. Frei would pull out all
stops for Tomic and would, I predict, seek our and the Armys support
in applying pressures.
B. If Alessandri were second, we face an extraordinary stem-
winder. Alessandri has said that he will accept the winner of the first
majority as definitive. The Nacionales have said they would vote for
the man who had the first majority. Thus these pledges would have to
be ignored and moreover the PDC would have to throw their votes to
Alessandri as well if Allende were not to become President. Senate
President Tomas Pablo (PDC) came uninvited to the residence Sunday
Aug 9 to speculate inter alia on this hypothetical situation. He noted
that if Alessandri were elected by Congress, the old man could keep his
electoral pledge to respect the first majority by refusing to accept the
Presidency. (Alessandri has always said he would not seek to govern
without effective support and such renunciation would also be con-
sistent with this view.) If Alessandri refused the Congressional will,
then, according to Pablo, new elections would have to be called with
the President of the Senate acting as interim President. Frei would be a
candidate in the new election and would surely win an overwhelming
majority (and Pablo would have reached the heights by being regis-
tered in history as one of Chiles Presidents). In other words, there
would be a deal between Nacionales and PDC to block Allende and to
re-elect Frei. The support of Schneider and the Army in the face of cer-
tain Marxist mob violence, general strikes and MIR crimes would, of
course, be essential. So would our financial resources, intelligence data,
and covert moral support.
C. If Allende were to finish second within 100,000 votes of Ales-
sandri, the problem is no less complex. There would be perhaps a third
of the Christian Democrats (that is up to 25) in the Congress disposed to
vote for Allende and there might be some orthodox Radicals prepared
to abandon Allende in the secret ballot. Unless Frei and his lieutenants
were to exercise all of their influence within the Party and unless all
levers of pressure were brought to bear on the Radicals, the Allende
forces would prevail. (Perhaps this is the place to interpose a judgment
on Tomic. If he finishes well behind the other two, Freis influence in
the PDC will be considerable; but if Tomic is third by a comparatively
small number of votes the recriminations against Frei by the Tomicistas
will be bitter and their inclinations (including Tomics) to fight Frei and
to help Allende will be very powerful.)
14. No one here can conceive of any supportable scheme for a U.S.
role strictly limited to the military for reasons given above. And
without a U.S. tactical role, we find it difficult to suggest what the Ar-
gentines might do; they wish us to tell time.
378-376/428-S/80023
January 1September 4, 1970 137
15. But as I said at the outset, the military hypothesis must be seen
as part of Phase Two. There, I continue to believe that the U.S. does
have an opportunity to play a constructive and effective role in which
the military would be included. It is because we have the power to in-
fluence that Senate President Pablo came to the residence to emphasize
his worrisome responsibilities and to fret over the various hypothetical
alternatives. While I could not satisfy his desires because of the Depts
prohibitions, I did use the opportunity to state in very forceful terms
my personal convictions that an Allende govt would signify a Marxist-
Leninist system in Chile, a view that Pablo did not rpt not share at the
outset of our conversation. He did say that Frei was firmly convinced as
to the overriding necessity to keep out Allende. I have no idea (nor did
Pablo) how Frei proposes to do so and the President will surely not vol-
unteer that information to one who merely seeks information as a pas-
sive observer.
16. Moreover, I doubt that he has yet fixed on any plan. He is re-
ceiving too many optimistic PDC reports about Tomics chancesfrom
PDCers of all stripesto have ruled out the possibility that Tomic will
yet make a real run in the elections. There is no longer any doubt what-
soever that Frei is working flat out for Tomic and that he now sees the
faint possibility of Tomic edging out Allende or Alessandri for second
place because of the impact of the Castro July 26th speech
3
added to
other well-known factors. He is playing the anti-Marxist side of the
street while Tomic sings his familiar Popular Unity tune of the other
side. From Cabinet Ministers who accompanied Frei on the 12 hour in-
auguration of El Tenientes expansion Saturday, I heard urgings that
the Castro admission of failure be played to the hilt.
17. Pablo told me that the critical time frame will be the first fort-
night after the elections when the bidding for congressional votes
begins. If we are to influence that bidding we shall have to be prepared
to act promptly on Sept 5 and to take our decisions now.
18. [3 lines not declassified] I share the Depts desire to protect the
President and the Embassy to the maximum extent from any exposure.
My own view is that the usual alternatives[1 lines not declassified]
would be incompatible with the situation and more risky of failure and
exposure than anything I might do. To reconcile these two preoccupa-
tions, I would suggest the following:
A. [1 paragraph (1 lines) not declassified]
B. [1 paragraph (2 lines) not declassified]
C. [1 paragraph (4 lines) not declassified]
3
In his July 26 speech, Castro described the failure of the Cuban economy and of-
fered to resign. (Castro Describes Economic Failure, New York Times, July 27, 1970, p. 1)
378-376/428-S/80023
138 Foreign Relations, 19691976, Volume XXI
D. [1 paragraph (3 lines) not declassified]
19. [1 paragraph (1 line) not declassified]
A. [1 paragraph (3 lines) not declassified]
B. [1 paragraph (3 lines) not declassified]
C. [1 paragraph (1 line) not declassified]
D. [1 paragraph ( lines) not declassified]
E. [1 paragraph (1 lines) not declassified]
20. The point of this proposal is to make the effort a Chilean one
and to reduce U.S. exposure potential to the minimum. [4 lines not
declassified]
51. Telegram From the Department of State to the Embassy in
Chile
1
Washington, August 12, 1970, 2241Z.
130820. Ref: Santiago 2979.
2
For Ambassador from Meyer.
1. I regret that my absence in Bogota and John Crimmins almost
total absorption in the Mitrione/Fly case have delayed this reply.
2. Let me try to explain our concern about Phase 2 and Freis partic-
ipation in it, a concern which was expressed in my earlier message
and which you seem to be misunderstanding despite the meeting of
minds which Crimmins thought you and he had attained in your
conversation.
3. Phase 2 as presented by you is a very specific political operation
designed to try to forestall Allendes designation by Congress through
the buying of the votes of key Congressmen. Phase 2 is a continuation
of Phase 1 in that both are efforts to keep Allende from becoming Presi-
dent. The NSSM 97 exercise is addressed to US policy and strategy in
the event of Allendes accession.
3
Of course, NSSM 97 can affect judg-
ments about Phase 2 in the sense that conceivably we may determine
that the threat to our interests is so great and our counter-strategy and
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile Chronology 1970. Secret; Priority; Roger Channel. Drafted by Crimmins;
approved by Gardner. A stamped notation on the first page reads: Special Handling.
2
Document 48.
3
See Document 46. The responses are Documents 13 and 14 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
January 1September 4, 1970 139
policy so ineffective that the assumption of the risks and uncertainties
of Phase 2 is worthwhile. That remains to be seen, however.
4. Phase 2 in the judgment of everyone here in Washington is an
extremely delicate, difficult and dangerous operation, if only for tech-
nical reasons. It is, to quote Bill Broe, a security nightmare. Moreover,
its possible effectiveness (i.e., its prospects for achieving the result we
all desire, the blocking of the Allende accession), is still to be assessed.
The calculus of feasibility, risk and effectiveness will be the heart of any
decision to approve or reject Phase 2.
5. We would be rather stupidas well as unconscionably indif-
ferent to your reportingif we did not appreciate that Freis political
judgments are very important in the continuing effort. My injunction
upon the Embassy was in no rpt no way intended to inhibit you from
keeping in as close touch with him as you considered necessary in
order to keep yourself and us informed about his running analysis and
to stiffen him as necessary in his apparent anti-Allende resolve, the
latter being the purpose, as I understand it, of the conditioning you
advocate. Crimmins tells me that he thought you and he had specif-
ically cleared this general point up.
6. My cautionary guidance and the parallel guidance given to the
Station by CAS Headquarterswhich was in no way stimulated by us
but rather represents an independent judgment independently arrived
atwere and are intended to assure that none of us even intimates to
any Chilean or anyone else, or leads them to infer plausibly, that we
may contemplate a Phase 2 operation. We have already heard through
CAS and elsewhere that there is already loose talktotally uncon-
nected with the Embassygoing about that Americans are going to
make their move between September 4 and October 24. Despite its pos-
sible inevitability and also its vagueness, this sort of thing makes us
nervous recognizing as we do, and as you do, that nothing could play
more into the hands of the Allende forces or contribute more to pro-
ducing the exact result we all want to avoid than an indiscretion on
Phase 2. I know that you and the Station Chief are hampered by these
restraints, but I see no other prudent course, given the stakes.
7. To sum up, I certainly expect, and have expected all along, as
Crimmins told you, that you would be dealing with Frei on the elec-
tions and on his intentions toward them. If your conditioning of him
leads him to take actions on his own in consonance with our interests,
great. But this process has to stay very well short of permitting him to
believe or to deduce that we are contemplating a covert political opera-
tion of a Phase 2 nature.
8. In this sense, I approve the specific request you make in para 11.
9. If this reply does not satisfy your needs, please let me know,
being as precise as you can about your problem.
Rogers
378-376/428-S/80023
140 Foreign Relations, 19691976, Volume XXI
52. Memorandum From the Assistant Secretary of State for
Inter-American Affairs (Meyer) to the Under Secretary of
State for Political Affairs (Johnson)
1
Washington, August 18, 1970.
SUBJECT
NSSM 97Chile: Recommendation of Option
NSSM 97
2
asked what options are open to the United States in the
event of an Allende victory in the Chilean presidential elections. The re-
sponse
3
prepared by the Interdepartmental Group for Inter-American
Affairs lists three:
4
Option A: Make Conscious and Active Effort to Reach Modus
Vivendi
Option B: Adopt a Restrained, Deliberate Posture
Option C: Seek to Isolate and Hamper Allendes Chile
ARA recommends the selection of Option B.
The advantages and disadvantages of each option are discussed in
Section V. In sum, we believe that Option A, while worthy of inclusion
in the paper, will not exist as a viable alternative to the United States be-
cause of the various actions which Allende has promisedcredibly, in
our viewto take. Confiscatory expropriation of the U.S. copper com-
panies, the denunciation of the OAS, and the establishment of rela-
tions with Cuba would make impossible the establishment of a modus
vivendi acceptable to us. For the United States to go out of its way to
reach accommodation with a government so clearly hostile to it would
not only be unsuitable but would encourage similar behaviour on the
part of other governments. Allendes domestic opposition would be
discouraged and the United States would be seen everywhere as un-
able or unwilling to protect its interests.
1
Source: Department of State, S/SNSSM Files, Lot 80D212, NSSM 97. Secret; Sen-
sitive. Drafted by Girdler; cleared in ARA/AP.
2
Document 46.
3
The August 18 study in response to NSSM 97 is Document 13, Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973.
4
The annex to the study in response to NSSM 97 contains a fourth option, over-
throw of Allende by the Chilean military, and examines its advantages and disadvan-
tages. It is dated August 18 and is Document 14, ibid. Meyer, in an August 17 memo-
randum to U. Alexis Johnson, presumably responding to an earlier draft, concluded that,
with respect to this option, the prospects of success are poor and its risks prohibitively
high. (Department of State, Virtual Reading Room, Chile Declassification Project) See
also Document 50.
378-376/428-S/80023
January 1September 4, 1970 141
Option C, on the other hand, seems to us to call for a U.S. response
which, while undeniably vigorous in the face of outspoken hostility,
would turn out to be not only ineffective but counter-productive. As
the paper points out, we do not believe that the United States could
even obtain hemispheric, much less global, support for an economic-
denial program. At the same time, our pursuit would provide Allende
with an issueimperialist pressurewhich would assist him to in-
crease his popularity with the nationalistic Chilean public and prob-
ably win some sympathy for him in other nations as well. Furthermore,
such a program on our part would lend credence to the argument that
Chile was forced to turn to the Soviet Union for sharply increased
assistance.
In our view, Option B affords an appropriately firm response to
any manifestation of hostility by an Allende government, without
causing the problems just listed. Its greater flexibility would enable us
to harden or soften our line as developments warranted, without re-
quiring a major policy shift; and its restrained, deliberate manner
would improve prospects for obtaining the acquiescence or support of
other countries for our policies and actions.
378-376/428-S/80023
142 Foreign Relations, 19691976, Volume XXI
53. Minutes of a Meeting of the Special Review Group
1
Washington, August 19, 1970, 55:17 p.m.
SUBJECT
Chile (NSSM 97)
PARTICIPANTS
ChairmanHenry A. Kissinger
State JCS
Charles Meyer Adm. Thomas H. Moorer
Defense NSC Staff
David Packard Viron P. Vaky
William E. Lang Col. Richard T. Kennedy
Jeanne W. Davis
CIA
Richard Helms
[name not declassified]
SUMMARY OF DECISIONS
1. To prepare for the President:
a. an action plan as to how we might prevent an Allende election
victory in the Chilean Congress vote on October 24;
b. a recommendation as to whether we should implement such a
plan between the September 4 election and the October 24 Congres-
sional vote;
2. To defer discussion of the NSSM 97 paper
2
until after the Sep-
tember 4 election.
Mr. Kissinger asked Mr. Helms what were the prospects for the
Chile elections.
Mr. Helms replied that the election would definitely go into the
Congress since Alessandri did not have enough votes to prevent this
process.
Mr. Kissinger asked if his understanding was correct that the
person with a certain margin has traditionally received the votes of the
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. The meeting took place in the White House Situation Room. An
attached August 20 note to Kissinger indicates that the latest poll results based on a
survey conducted [text not declassified] in early August 1970, were as follows:
Unadjusted Adjusted
Alessandri 38.58 41.49
Allende 28.16 30.06
Tomic 26.93 28.75
Abstention (Undecided) 6.33
Total 100.00 100.30
2
See Document 52.
378-376/428-S/80023
January 1September 4, 1970 143
Congress but that in this case Alessandri may not have enough of a
lead.
Mr. Meyer confirmed this understanding and said Congress may
not follow tradition.
Mr. Kissinger said he understood then that the second runnerex-
pected to be Allendewould then become President. He asked if there
was anything that could be done to prevent this, either by increasing
Allesandris margin or by supporting Tomic for the second spot.
Mr. Meyer said we know of nothing that can be done between now
and the election.
Mr. Helms added that with available funds and current effec-
tiveness we still could not get enough votes for Alessandri to eliminate
Allende.
Mr. Kissinger said he understood that Alessandri would need
more than a 5 percent margin if the Congress were to commit them-
selves to him.
Mr. Vaky said if he should win substantially the compulsion to
follow tradition would be much greater. He estimated Alessandris
margin at 80 to 90,000 votes3 percentbut noted there would be a
final poll on August 20.
Mr. Kissinger asked when Congress would vote.
Mr. Meyer replied October 24.
Mr. Vaky noted that the crucial period would be from 2 to 4 weeks
after the election on September 4.
Mr. Kissinger agreed there was probably nothing we could do
about the election and that the issue would go to the Congress where
the outcome was in doubt. He asked what we could do to position our-
selves for this 2 to 4 week crucial period.
Mr. Meyer said it was a question of money.
Mr. Helms said we could start finding out what we might do with
funds if we had them without running the risk of blowing the election.
Mr. Kissinger said, assuming we go into gear on September 4,
could we find out enough in the 3-week period to do us any good?
Could we improve our chances if we identified certain individuals
now? Are we doing any exploratory work? On the assumption that we
do nothing until September 4, if we should decide to move after that
time, do we know what orders we would issue and to whom?
Mr. Helms said we did not.
Mr. Meyer said he thought it had been decided at the 40 Com-
mittee that we would not proceed.
3
3
See Document 41.
378-376/428-S/80023
144 Foreign Relations, 19691976, Volume XXI
Mr. Packard asked if we could not decide at least how much
money we would have.
Mr. Kissinger asked if we could not have money set aside and have
people identified.
Mr. Lang remarked that Alessandri and his party had undertaken
an intensive examination of individual Congressmen and have a
second phase plan in mind. Frei also has something in mind. We might
approach Frei and Alessandri through a third party in order to get
them together.
Mr. Kissinger found it hard to understand why we should not
have a plan ready by September 4.
Mr. Packard agreed that we should have some idea of money and
whom to give it to.
Mr. Helms said he had understood that this planning was taboo.
Mr. Kissinger agreed that any activity before the election was
taboo. He thought however, the President will want maximum effort
made to keep Allende from winning in the Congress and we could cer-
tainly proceed now with the internal staffing of this effort.
Mr. Helms agreed.
Mr. Kissinger said we could discuss the paper after September 4.
We would then have until October 24 to implement any decision. The
big problem to consider was how to prevent an Allende victory. He
suggested that Packard, Helms and the Station Chief prepare a plan
and asked if this were agreeable.
All agreed.
Mr. Kissinger asked that the plan be as precise as possible and in-
clude what orders would be given September 5, to whom, and in what
way.
Mr. Helms agreed.
Mr. Kissinger said we should present to the President an action
plan to prevent an Allende victory in the Congress and our view of the
desirability of our doing anything, noting that the President may de-
cide to move even if we do not recommend it.
378-376/428-S/80023
January 1September 4, 1970 145
54. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, August 20, 1970.
SUBJECT
Chile and Phase 2
Yesterday the Special Review Group agreed that CIA would
present a specific staffed plan to implement Phase 2.
2
Up to now, the Ambassador and Station have been under explicit
instructions not to discuss or explore such an operation with any
Chilean asset. The Group yesterday did not specifically address the
question of whether the Station should try to gather information or
judgments from Chileans for the purpose of the staffing it was asked to
undertake.
This morning the Agency told me that they cannot staff a plan well
without consulting the man who would be the Chilean cut-out (and
who is in fact already our cut-out for Phase 1). They argue that there are
a number of things they can only guess ate.g., how much money is
needed, precisely how many people would be susceptible, etc. A good
judgment on these things would require probing and exploring with
the Chileans who know. The Agency proposed to have the Station
Chief contact the cut-out only on an exploratory, no-commitment basis
to ask simply how such an operation might be structured and what
would be required. Risk here is very minimal; we are working with him
now anyway.
State opposes this, and Alex Johnson called me on it to protest. His
objection is that this tips our hand to the Chileans before we have really
decided if we would do it anyway. He thinks we need not take that
chance because we would not be delayed that much if we waited until
after the September 4 election to do it. He said we might not want to do
it at all. He observed, as an example, that it would make no sense for us
to get involved if the Chilean elements were not going to get involved,
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. Sent for information. Kissinger wrote, make memo to Pres. rec-
ommending contacting the cut out, in the upper right-hand corner. Vaky explained his
reason for not following this instruction in Document 57. In a covering note to Kissinger
on another copy of this memorandum, Winston Lord wrote, Note last paragraph where
Vaky says meeting may be necessary before Sept. 4 because of State opposition. Vaky
knows scheduling difficulties + will try to avoid meeting. (National Archives, Nixon
Presidential Materials, NSC Files, Box 774, Country Files, Latin America, Chile, Vol. II)
2
See Document 53.
378-376/428-S/80023
146 Foreign Relations, 19691976, Volume XXI
and that we should act only at the necessary margin to make an opera-
tion effective. I pointed out that we could not judge those things until
we explored the Chileans reactions. In any case his arguments seem to
me to rationalize his (and States) basic opposition to the whole idea of
a Phase 2 operation, and they underline the fact that the 40 Committee
has never decided in principle to undertake such an operation.
Johnson flatly refused to okay the Chilean contact, and was pre-
pared to appeal to you. To avoid the delay of in-fighting, I agreed to a
proposal that the Agency do the best it can in-house in staffing a spe-
cific plan by Monday.
3
The idea would then be that this would be im-
mediately examined to determine:
(a) if it was enough to permit the basic decision on whether to
mount a Phase 2 operation; or
(b) whether we needed to contact the Chilean cut-out now in order
to make that basic decision or in order to move promptly on September
5 if necessary.
I agreed to this for the following reasons: (a) I had never really con-
templated anything but an in-house staffing now anyway; (b) there is
no use in arguing about how much more we need for adequate staffing;
we may as well do what we can and prove its adequacy or inadequacy;
and (c) we wont be delayed significantly anyway since the in-house
staffing ought to be ready Monday or Tuesday.
You should, however, understand the following:
1. State is opposed to the idea of Phase 2: they are hoping we will
never have to use it. They do not want to do anything by way of staffing
with Chilean assets unless there is a basic policy decision to proceed
with this operation.
2. The 40 Committee never made such a policy decision; it is going
to have to do so before September 4. While I had hoped that a meeting
might be avoided and a telephone poll on the staffed plan suffice, it is
clear now that you are going to have dissent and that a meeting is prob-
ably going to be necessary.
4
3
August 24.
4
The word probably was added by hand. An index of documents in National Se-
curity Council, Nixon Intelligence Files, Subject Files, Chile, 1970 notes that no 40 Com-
mittee meeting was held prior to the September 4 election because of the separation and
schedule at San Clemente.
378-376/428-S/80023
January 1September 4, 1970 147
55. Memorandum by the Acting Chief of the Western
Hemisphere Division, Directorate of Operations, Central
Intelligence Agency ([name not declassified])
1
Washington, August 23, 1970.
SUBJECT
Phase II Planning
1. The Ambassador and the Station have for some time pondered
steps to be taken to prevent Allendes election in the congressional
runoff. This paper addresses itself only to one of several contingencies,
without necessarily implying that it is the most probable one: Ales-
sandris emergence in the first place, followed by Allende in second
place by whatever margin, neither having won an absolute majority on
4 September.
2. Given the above contingency, we predicate our planning on the
assumption that the U.S. Government will have reached a firm deter-
mination that the interests of the U.S. in Chile, and in the Western
Hemisphere as a whole, are best served by Alessandris election to suc-
ceed Frei and by a denial of the presidency to his principal opponent,
Allende. Whereas during Phase I, considerations counselling against
U.S. Government involvement in Alessandris campaign had to be
viewed as overriding, those considerations will by and large cease to
apply once Phase II has been ushered in. To the extent deemed practi-
cable, we shall continue concealing the American hand and shall care-
fully weigh the risk factors involved in each step we take. It should be
clearly understood, however, that in order to win Phase II, help may
have to be tendered to Alessandri and Frei in a variety of ways. Finan-
cial help, if necessary, will be securely provided via third parties. Dis-
cussions with Alessandri would be conducted via his authorized repre-
sentative and not with Alessandri himself. If either Alessandri or Frei
seeks our counsel, we ought not be debarred from offering it.
Assumptions
3. In the main part of our presentation, certain questionable as-
sumptions will become readily apparent and are flagged as such. The
following listing of such assumptions, reflecting gaps that need to be
filled in due time, is not meant to be exhaustive, but singles out certain
assumptions we have found particularly troublesome:
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Kissinger Of-
fice Files, Box 128, Country Files, Latin America, Chile Wrap-Up and Post Mortem.
Secret.
378-376/428-S/80023
148 Foreign Relations, 19691976, Volume XXI
A. In the absence of reliable indices suggesting the obverse, we
have to assume that the army will adhere to the letter of the hands-off
doctrine (Schneider statement). This notwithstanding, the size of Ales-
sandris majority and serious prospect of major turbulence during pre-
runoff period could give the army and President Frei food for thought.
Congressional prerogatives could be deemed by Frei and the military
alike a lesser evil.
B. We assume and yet have exceedingly limited information and
scant precedent to go by, that Freis influence in his partys councils
will, in the aftermath of his partys electoral defeat, not only emerge un-
impaired but may be greater than before. Assuming the latter to be
true, we further are inclined to believe that he will throw the weight of
that influence into the scales even at the risk of splitting his party.
C. We assume that the Christian Democratic Party (PDC), if con-
fronted with a choice between Alessandri and Allende, will break party
discipline and split along ideological and economic lines. It may turn
out, however, that with Tomic relegated to the backbench an opening
to the left and all that entails may lose much of its deceptive lure.
D. We assume that after 4 September there will ensue a coalescing
of moderate forces, with Alessandri and Frei in the van, and conse-
quently view Phase II as a low-key supplementary effort designed to
preclude untoward realignments of power factions with the non-
Marxist camp.
E. We assume that the Unidad Popular alliance will lose much of
its cohesiveness and that calls to mass demonstrations and violence, if
made will go largely unheeded.
F. We assume that the Communist Party of Chile (PCCh), short of
recourse to violence, will engage in massive political action designed to
split the PDC and dissuade Radical Party (PR) congressmen from de-
serting en masse to Alessandris camp. (This assumption, we consider
the least questionable of all.)
G. We assume that in a predictably close runoff, congressional
votes will become available for sale in sufficient numbers to tip the bal-
ance and that delivery of votes that have been bought can be assured
with a tolerable degree of certainty. As we have not been able to raise
this issue with knowledgeable Chileans, this represents a definite soft
spot in our planning exercise. We know that there is ample precedent
for the purchase of congressional favors. We lack anybody of experi-
ence to fall back on in predicting what safeguards are available to pre-
vent the loss of a bought vote in a secret congressional ballot. Nor can
we provide you with any reasonable estimate of whether the political
mores and parliamentary traditions of Chile reasonably permit prom-
ises of remuneration to be fulfilled only on the condition that the con-
gressional vote satisfies the purpose we hoped to achieve by holding
378-376/428-S/80023
January 1September 4, 1970 149
out financial inducements. Since we are requested to disregard figures
previously bandied about and to the best of our ability come up with
a monetary estimate for this obviously important operational aspect,
we pull out of the hat a figure of $500,000 for congressional bribes only,
again without benefit of advice by knowledgeable Chileans. We reason
that the market for congressional votes will be a bullish one if the race
appears close and would not rule out that predictions of closeness will
become rife once it appears that big money is getting ready to enter
Chile. We depend heavily upon the [less than 1 line not declassified] to
protect the U.S. Government against a royal fleecing.
H. We assume that during the period leading up to the day the two
houses of congress convene to elect the next President of Chile, the con-
gressional base position will remain unaltered, namely:
1. Congressmen supporting Allende (including the PR)
2. Congressmen formerly committed to support Tomic
3. Congressmen supporting Alessandri
Summary of Proposals
4. With the above basic assumptions guiding us, we can project
certain likely courses of action which the Ambassador and the Station
feel it within their competence to execute:
A. To monitor closely Freis, Alessandris and the armed forces
perceptions of the post-electoral situation and to make ourselves avail-
able for use by them as sounding boards and as honest brokers if they
manifest any desire to invite us in that role.
B. To brief [name not declassified] on significant insights we may de-
velop and, as appropriate, seek his counsel on any major action depar-
tures in influencing the congressional vote.
C. To use [name not declassified] as our chosen instrument in car-
rying forward certain aspects of the Phase I program into Phase II and
to make intensive use of his facilities for secure funding operations.
D. To use [name not declassified] long-standing relationships with
Alessandri and Frei, to assist us in staying abreast of their thinking and
planning, and to unattributably inject compatible U.S. Government
counsel and offers of support in manipulating the congressional vote.
E. To encourage [name not declassified] to widen the range of his
military contacts in the three branches of the armed forces, so as to pro-
vide up-to-date readings of military attitudes and early warning of
drastic changes in those attitudes.
F. To keep intact action instrumentalities, developed both unilater-
ally and bilaterally under the aegis [less than 1 line not declassified] for
apposite use in Phase II, and to organize new ones if considerations of
operational security and of effectiveness dictate our doing so.
378-376/428-S/80023
150 Foreign Relations, 19691976, Volume XXI
G. To stay abreast of political activities, such as funding, under-
taken by the American business community during Phase II, but es-
chew cooperative ventures or actions which, were they to become
known, could be adduced by the Chilean left in proof of U.S. Govern-
ment intervention in the congressional runoff.
H. In making monetary estimates, our rate of spending during
Phase I provides us with a yardstick of limited utility. To repeat this
once more, we have to assume a close congressional runoff vote (i.e. a
political setting in which financial inducements could become pivotal)
and the launching under Communist auspices of a no-holds-barred po-
litical action program, which has as its objective to convince the
Chilean people and its parliamentary representatives that Allende
rather than Alessandri be voted into power. Given those two assump-
tions, both of which require checking out, we submit that parsimony
would be difficult to justify and that adequate provision ought be made
to:
1. Buy congressional votes up to $500,000 and
2. Carry on a political action program of the type outlined below
which may cost $300,000 or more.
Political Factors
5. Certain fundamental considerations about the political environ-
ment in Chile have strongly influenced our proposals:
A. The political climate in Chile is not conducive to any but the
most discreet uses of American influence. There remains a limited res-
ervoir of good will for the United States among well-disposed Chileans
on which the U.S. Government will be permitted to draw in bringing
carefully dosaged and highly discreet pressures to bear, opposing or fa-
voring major political groupings and their leadership. Hence, the
highest attainable standards of tradecraft in concealing the American
hand ought to be adhered to in Phase II as they were in Phase I.
B. Chilean initiatives to prevent Allendes election will be of pri-
mary importance and the American role will be distinctly ancillary. It
may have to consist only in buttressing courses of action upon which
Chileans themselves have already decided to embark.
C. Alessandri and Frei as leaders of distinct and antagonistic
power factions will probably be the principal actors in lining up con-
gressional votes against Allende. Alessandri has long-standing and
natural access to the Radical Party which was a coalition partner in his
first administration. President Freis ability to instill in his party a sense
of national destiny, if unscathed by a temporary electoral setback,
would go a long way toward assuaging among party ranks a sense of
unreasoning despondency and defiance. On the other hand, if un-
378-376/428-S/80023
January 1September 4, 1970 151
checked, those feelings might find release in unthinking acquiescence
in an Allende victory.
Frei and the PDC
6. Christian Democratic attitudes, if forced to choose between Al-
essandri and Allende, are a matter of much speculation. For want of
more reliable estimates, we are willing to accept Freis estimate that at
least 18 of 75 PDC congressmen will vote for Allende anyway. If all
others vote for Alessandri, the latters election is assured. But Frei may
not be able to ensure the delivery of these uncommitted votes to Al-
essandri. PDC congressmen, in arriving at a decision for whom to vote,
will have to heed extraneous pressure which may override deeply felt
ideological preconceptions and summons of party loyalty. Pressures
will doubtless be generated by the margin of Alessandris victory
whose size could resuscitate respect for constitutional precedent to in-
vest the presidency on the candidate with the largest majority. Armed
forces preferences, appropriately enunciated, would have to be ac-
corded their due weight in making up congressional minds. Freis in-
tervention to sway pro-Allende holdouts, and a fortiori ours, will be-
come marginal if extraneous factors are overpowering.
7. Considerations of enlightened self-interest plus fear of political
obliteration under Allende government may be sufficient inducements
to prompt these same uncommitted votes to be cast for Alessandri. We
may find that the PDC, acting as a corporate and moderately disci-
plined body, will find even a relatively small margin of victory for
Alessandri sufficient cause to opt for democratic survival versus the
ineluctable alternative of forfeiture of democratic freedoms under a re-
gime dominated by the Communist Party.
8. The tide of emotions in Chile is running higher than ever before
and the campaign will leave deep scars. For Christian Democrats to seal
their election defeat with an affirmative vote for Alessandri is asking a
lot. The ensuing dilemma could strain party cohesion beyond endur-
ance and make options for the candidate of the left palatable. Much will
depend not only on Freis persuasive powers and leadership abilities
but also on Alessandris unique ability to bind wounds and to offer
Christian Democracy a constructive role to play in carrying on some of
the social and economic reforms for which they can justly claim credit.
9. In weighing the pros and cons of enlisting U.S. Government sup-
port, Frei and his supporters will obviously have to take into account
tremendous political risk factors which that transaction, even under
optimum security conditions, would entail for their movement. Ani-
mosity in the PDC toward the U.S. Government and bitterness engen-
dered by Tomics defeat may become key factors in their final decision.
10. Our posture, therefore, should be one of watchful waiting ac-
companied by discreet reminders to those PDC leaders who are still
378-376/428-S/80023
152 Foreign Relations, 19691976, Volume XXI
predisposed to heed American advice that the situation calls for their
exercise of courageous and non-partisan judgment. In this way the first
steps can be taken to promote national reconciliation. In numerous
meaningful ways the U.S. Government will be able to render appreci-
able contributions to that process and assist in laying the groundwork
for a reconstitution of the political center of Chile in which Frei and the
bulk of the PDC have a vital stake and role to play.
Alessandri and the Radical Party (PR)
11. It devolves upon Alessandri to persuade 27 Radical Party con-
gressmen to vote for him, rather than for the leftist candidate whom
their party is officially committed to support. Among extraneous pres-
sures influencing their individual determination will also be the
margin of Alessandris victory. If it appears, as currently predicted, that
the partys rank and file in its overwhelming majority deserted to Ales-
sandri, pressures generated at grassroot level are likely to sway many
congressmen, confronted with the alternative of their partys total dis-
integration. To win over an already existing oppositional grouping
among Radical congressmen led by Senators Bossay, Juliet, and Acuna,
should pose no insuperable difficulties. We surmise that either finan-
cial inducements or offers of patronage or a mix of both should carry
sufficient conviction. They will naturally assay the relative merits of pa-
tronage under Allendes aegis as compared with Alessandris; in so
doing, they cannot view with indifference the circumstance that their
mortal enemies, the Socialists, are senior partners in an alliance they
will be invited to join. Besides, they can be depended upon to ponder
carefully the fact that under Allende, the present congress will be re-
placed by a unicameral body with no place for a party system.
12. We believe that Alessandri is endowed with a consummate un-
derstanding of the Radical Partys modus operandi and its pressure
points. He comprehends that many congressmen, though reluctant to
provoke ouster from their party and to find themselves cast adrift in
uncharted political seas. This reluctance has been abetted by the party
leadership by not insisting on strict party discipline. As a result, several
congressmen, in good standing, have openly campaigned in favor of
Alessandri. We are sanguine in anticipation of sizeable Radical defec-
tions to Alessandri when the congressional vote is called. They will
have no ideological compunction in switching allegiance, especially
since the secrecy of the congressional vote enables them to indulge
their self-interests without fear of disciplinary retribution. While it
would ill behoove us to place ourselves in the vanguard of any drive to
win Radical votes for Alessandri, we may be asked by him to lend a
helping hand in the provision of material inducements. Since the hard
core of opposition to the Radical alliance with Unidad Popular
centers around a group of senators strongly dedicated to the preserva-
378-376/428-S/80023
January 1September 4, 1970 153
tion of their partys integrity and to bringing its dissidents back into
the fold any further pursuit of the Stations program to hasten the par-
tys demise would obviously be counterproductive. Since we have
achieved no signal results in achieving that end, we would not hesitate
at cutting our losses. Whether the rift between Senator Duran and his
erstwhile party colleagues can still be healed, remains to be seen. We do
not now and have not in the past had any stake in the Radical splinter
movement and its political fortunes per se. We feel under no obligation
to them.
13. In order to mesh our efforts at denying Radical votes to Allende
with Alessandris at gaining them, we would seek information about
the views of Alessandri soonest after the elections. We would do so
through a trusted intermediary and without openly showing the Amer-
ican hand. We expect strong pressures on the part of Duran to persuade
him to acknowledge and use him as the chosen instrument for forging
such an alliance. Since he is anathema to many of the Radical con-
gressmen whose sympathies lie with Alessandri, he must be presumed
uniquely unsuited to fill that role. In order to sidestep unpleasantness,
therefore, we have no choice but keep on the sidelines and to defer to
Alessandris judgment as to how best sew up the Radical vote.
14. Through [name not declassified] and several of his most trusted
associates with traditionally close Radical connections, we expect to ob-
tain reliable readings on Alessandris strategy in coping with the Rad-
ical problem and to be apprised of any critical developments which
may require our intercession. Requests for financial help in the induce-
ment of Radical defections are likely to be levied against [name not de-
classified]. His appraisal of the scale of magnitude on which such help
will have to be projected can be considered dependable. We are confi-
dent that Washington will be provided with the necessary estimates by
mid-September.
Military Factors
15. In a recent message to Ambassador Crimmins on 11 August,
Ambassador Korry addressed himself to the problems summed up
under option 4 which should be read in conjunction with what
follows.
2
16. The army which is the most important branch of the armed
forces is currently indisposed to enter the political scene to throw its
support behind either of the two candidates. The prevailing mood
among army officers is in favor of permitting congress to choose the
president and opposed to involving the army in that decision. We find,
at present, no significant backing for any use of army pressure to deny
2
Document 50.
378-376/428-S/80023
154 Foreign Relations, 19691976, Volume XXI
Allende the presidency. Elements of undetermined strength in navy
and air force are reportedly opposed to Allendes election and favor Al-
essandri. Without army support, however, they cannot make their
views prevail. President Freis personal following in the army officer
corps has dwindled and his ability to overcome the armys apparent
determination to stay within the constitutional framework should be
considered negligible. We also take cognizance of a widely shared be-
lief that President Frei will under no condition lend his support to
extra-constitutional ventures that could usher in a military dictator-
ship. We need not speculate what his reaction would be, should the
army confront him with an accomplished fact.
17. In any estimate of armed forces capabilities and intentions to
intervene politically, allowance has to be made for the triggering of
such intervention by a relatively subordinate army unit, as was the case
during the abortive uprising of the Tacna Regiment in October 1969.
3
It
happened once and it could happen again. Many army officers on the
senior level view the prospect of an Allende victory with profound pre-
occupation. What is holding them back is equally profound concern
that the institution might not withstand the strains necessarily imposed
by political intervention, especially since Allende is believed to have a
respectable following among junior officers and non-commissioned of-
ficers. Whether or not this concern is soundly based, does not matter.
What matters is that concern over the disruptive effects of political in-
tervention by the army is widely shared and thereby inhibits recep-
tivity to pleas for army moves to prevent Allendes victory. To quote a
distinguished senior officer, Alessandri and his followers should make
it their business to win by a sufficiently large margin instead of leaning
on the armed forces to pull political chestnuts out of the fire.
18. In any attempt at providing a reasonably accurate forecast of
what the armed forces are likely to do or not to do in certain contin-
gencies, we cannot permit ourselves to pass over General Roberto
Viaux who came close to toppling Frei. He is still a military figure of
some consequence, although retired. Recent reports indicate that he is
prepared to incur considerable personal risks in preventing an Allende
victory. Although we lack reliable intelligence and are unable to pro-
vide strength estimates, he may still enjoy considerable support in the
Tacna Regiment and the adjacent school for non-commissioned officers
which served as his base of strength in October 1969. He might conceiv-
ably be able to provoke a split within the army over the issue of
whether or not to oppose Allende. We know for a fact that the army
high command is not inclined to brush off General Viaux as a has-been
and that his every move is being watched by the army and Ministry of
3
See Document 20.
378-376/428-S/80023
January 1September 4, 1970 155
Interior with vigilant concern. While they may have penetrated his
movement successfully, privyship to his plans does not necessarily
spell their ultimate failure.
19. The army high command can be under no doubt that the U.S.
Government would view Allendes victory as an event of exceedingly
grave portent not only for Chile but for Latin America as a whole. It can
therefore be argued that the U.S. Government would accept armed
forces intervention to prevent such a victory with sympathy although
nothing has been said or done to provide the armed forces with any fac-
tual basis for drawing that conclusion. We can assume that the army, in
postulating its doctrine of political non-involvement, has weighed and
discounted strong United States feelings over the installation of a pop-
ular front regime in Chile. We are consequently inclined to conclude
that U.S. Government leverage in an attempt to divert the armed forces
from a course of constitutional orthodoxy is negligible and that any im-
pulses to change that posture will have to originate from within the in-
stitution. For purposes of Phase II planning, we doubt that any useful
purpose would be served by placing reliance upon a military escape
hatch. Economy of effort and focus on one major effort with reasonable
prospect of success, dictate our concentrating on political warfare as
the surest means of preventing an Allende victory without inflicting ir-
reparable damage upon the very institutions whose defense provides
the principal rationale for preventing an Allende victory.
Holdover of Phase I
20. We envisage the necessity for a broad spectrum of political ac-
tion moves (a) to counteract likely attempts by the PCCh to split the
PDC and seal off the PR against further defections; (b) to influence
members of congress to cast their vote for Alessandri.
21. The basic thrust of our propaganda campaign will continue to
demonstrate that Allendes election spells the end of democracy in
Chile and a re-casting of that countrys political and economic structure
in the image of Cuba and other peoples democracies. Invoking those
countries as examples, appeals to the self-interests of parliamentarians
will be launched and the prospect of a rapid withering of Chiles party
system will be conjured up. Propaganda will be targetted at individual
congressmen, employing as media personal letters, newspaper edito-
rials, political advertisements and black press releases. Other types of
propaganda will be addressed to political parties and their district level
organizations, engendering pressures from the grassroot level up. Ra-
dio programs will play a major role. The poster campaign, on the other
hand, has played out its role and is likely to become prohibitively risky
after 4 September. We will continue to rely heavily on black propa-
ganda operations to exacerbate differences within the leftist camp and
promote a rapid disengagement of its non-Marxist components.
378-376/428-S/80023
156 Foreign Relations, 19691976, Volume XXI
22. In order to implement the above program with speed and effi-
ciency, denying Unidad Popular much of a breathing spell and time for
regrouping, our action mechanisms will have to be kept in a state of
readiness to shift over to the support of Phase II objectives.
23. Obviously the elections outcome and the reactions of the
victors and the vanquished will set in train political currents which we
find it impossible to predict with any degree of accuracy. Those cur-
rents, however, are bound to have a profound effect on our post-
election strategy. Political movements, facing a real or imagined pros-
pect of obliteration, will act and react differently from movements
assured of survival and a prospect for regaining power under a system
of government which assures the unimpeded play of political forces.
Under Alessandri, such assurances have already been tendered and
nothing should obviously be done to weaken their credibility.
24. Due to circumstances beyond our control, Phase I had to be car-
ried out in defiance of Alessandris preconceptions about an anti-
Communist campaign, although toward the end he appeared more dis-
posed to view it as a distinct asset and as a complement to his own less
combative campaign style. During Phase II it will be unavoidable to en-
tertain a more closely integrated propaganda effort. The pivotal role
played by [name not declassified] and by the infrastructure of action in-
strumentalities he controls will more or less automatically insure that
we are not working at variance with Alessandris post-election
strategy. We therefore propose to retain a high degree of flexibility to
adapt our propaganda product and any related action ventures to po-
litical winds prevailing after the election returns are in.
25. While not much thought could obviously be given to an appor-
tionment of our resources, we envisage sizeable expenditures in sup-
port of [less than 1 line not declassified] an early acquisition of prime radio
time on a nation-wide scale. The termination of the poster campaign
will result in considerable savings, but more will have to be spent on
printed materials (pamphlets, et al.) and on political advertising.
[3 lines not declassified]
Concluding Considerations
26. In answer to the review groups question,
4
we believe that in
the time remaining before 4 September, there is not much more that
could be done than is already being undertaken or planned. We have
not felt unduly restrained in doing what needed to be done while
keeping the U.S. Governments hand concealed.
27. We estimate that delaying the implementation of Phase II until
at least a week after the 4 September elections would redound to the
4
See Document 53.
378-376/428-S/80023
January 1September 4, 1970 157
benefit of Phase II. We reason that the precise margin of Alessandris
expected plurality and, most important, the political estimates formed
by Chilean policy-makers and opinion moulders, are bound materially
to affect our own perceptions. Any temptation, therefore, to act on the
strength of our earliest interpretation of the meaning of the election
outcome, before responsible Chileans have been able to collect their
thoughts, ought to be withstood. Shooting from the hip on 5 September
is a temptation which the more thoughtful Chileans have learned to re-
sist because they have found that first reactions are more a product of
exhilaration or gloom than mature reflection upon the import of the
election returns. Also, we are confident that Chiles armed forces and
police will provide a climate of domestic tranquility in which Chile can
sort out its national problems in an orderly fashion. Though Phase II
can safely wait through the first week after the elections, Phase I propa-
ganda activities should be carried forward without hiatus as explained
earlier.
28. Phase II planning is predicated on an electoral outcome in
which Alessandri is first and Allende is second. There will be no need
to implement Phase II if Allende is third. If Allende emerges first, even
by a small margin, popular forces rallying to his support may soon
prove to be overpowering.
[name not declassified]
378-376/428-S/80023
158 Foreign Relations, 19691976, Volume XXI
56. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, August 25, 1970, 2155Z.
3333. For Crimmins.
1. Embtel 3325
2
sent today provides details of an anti-Soviet opera-
tion [less than 1 line not declassified] published in Mercurio as a series enti-
tled the Kunakov Archives. The purpose of this message is two-fold: to
transmit my assessment of its effects and to request Dept support of my
recommendations.
2. The Kunakov Archives operation was executed under a stand-
ing [less than 1 line not declassified] mandate that encourages such activ-
ities. It was mounted with the high professional skill [less than 1 line not
declassified] although the content of the series so far justifies Patricio
Silvas deprecatory comments (Embtel 3325).
3. No one in the Embassy including myself had any knowledge of
the Kunakov operation until they read Mercurio Sunday morning. I
have now been informed it was long in preparation. Major targetting of
the Soviets during the final months of the electoral campaign was ex-
plicity and repeatedly prohibited by me in talks the past few months
(most recently two weeks ago) [2 lines not declassified]. I have heard no
acceptable explanation for my lack of prior information.
4. The point of this message however is not to provoke recrimina-
tions over what is done and cannot be undone. Indeed I would implore
the Department to eschew such wasteful indulgences and concentrate
on the future and the implications for US interests of the Kunakov Ar-
chives. [2 lines not declassified]
5. My only preoccupation is that US interests be protected as best
they can in a particularly vulnerable pre-electoral period and for the
post-electoral years. Publication at this time of the Kunakov Archives
in the [name not declassified] Mercurio is my considered judgement ex-
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile, JanuaryAugust 1970. Secret; Priority; Roger Channel.
2
Telegram 3325 from Santiago, August 25, reported: Influential conservative daily
El Mercurio today (Aug 25) ran third installment of so-called Kunakov File, purported
expose of Soviet espionage activity in Chile. Mercurios Soviet expert Jural Domic, under
whose by-line series appears, writes that Oleg Kunakov Gottmann, Chilean-born official
of Chilean-Soviet Cultural Inst, entrusted notes, memoranda, journal entries and contact
lists to him shortly before death, ostensibly of heart attack, in March 1970. Documents
record Kunakovs activities, and Soviet and Chilean contacts and reflections. These docu-
ments focus more specifically on the Soviet EmbassyPCCh (Chilean Communist Party)
relationship, dating from time of Kunakovs recruitment in late 1967. Domic insinuates
that Kunakovs premature demise was caused by poisoning. (Ibid.) See also Foreign Re-
lations, 19691976, vol. E16, Documents on Chile, 19691973, Document 15.
378-376/428-S/80023
January 1September 4, 1970 159
traordinarily inopportune. To any sophisticated reader (and I must as-
sume that the hyper-sensitive Foreign Ministry of this country, many
other Christian Democrats and other officials are sophisticated) the ar-
chives bear the imprint of the USG. [8 lines not declassified]
6. [less than 1 line not declassified] nobody could prove anything in-
volving the US since the documents that form the basis for the articles
are authentic. While I welcome the affirmation, it does not alter the im-
pact; I do not require any overt Chilean response to measure that effect
since there are many Americans in our Mission who promptly drew the
same conclusion that Chileans will draw. In political life, it is what
people believe that determines their future actions.
7. I am particularly concerned about the long-term effects on a
Christian Democratic Party that is already nursing frustrations with the
USG on many doctrinaire and practical levels. The Kunakov Archives
mention one detail that will particularly strike a sensitive nerve; it con-
cerns an operation prior to my posting to Chile [3 lines not declassified].
Recently UnderSec of Foreign Affairs Patricio Silva made reference to it
in a conversation with the DCM. [2 lines not declassified]
8. If Tomic loses as badly as everyone expects, the campaign of
terror [less than 1 line not declassified] will be held responsible by many
in the PDC and a significant portion of that party will not forget. The
Kunakov Archives will confirm their suspicions that the US had some-
thing of a hand in the campaign of terror and that, in turn, will be inter-
preted as a purely pro-Alessandri intervention despite the Frei convic-
tion that anti-Communism was the critical electoral element. So the
likes of Senator Fuentealba will batten once again on the US and will
solidify these anti-US elements in a party that still represents the center
of the Chilean spectrum and the repository of longer-term hopes of
fashioning a broader centrist coalition.
9. Dept is aware of my decision to postpone until after the elections
action on the agricultural sector loan. The PDC will interpret that action
as less than supportive of its Presidential candidate. Dept also aware of
Valdes bruised feelings that have most recently been rubbed by Freis
forcing him to withdraw the denunciation of the extradition treaty
which in turn has prompted Valdes to retaliate via the French Am-
bassadors unthinking indiscretions on personal security and to have
me disinvited to a Presidential lunch this week in honor of Paul
Rosenstein-Rodan. There is much more that could be added to verify
the less than happy relationship we have with the PDC but I must also
report that Valdes has told the PDC leadership that in his heart of
hearts, Korry is for Tomic.
10. We have calculated and accepted the political costs on Phase
One including its effects on the PDC. We had not included in our reck-
oning the untimely Kunakov Archives. [5 lines not declassified]
378-376/428-S/80023
160 Foreign Relations, 19691976, Volume XXI
11. After due consideration (since Sunday morning) I am per-
suaded that Phase Two can proceed with certain extra-precautions and
with some restrictions that will be dictated by local circumstances. I
recognize that my capacity to influence the PDC and Frei has been
damaged but as I have stressed in other messages, Chilean structures
and Chilean personages predominate so much that our Phase Two role
is very much now a modest reenforcing one. [2 lines not declassified]
Hence we cannot lose sight of our principal goal, particularly when it
will not involve additional vulnerability or damage.
3
12. Finally I have issued explicit instructions in writing [less than 1
line not declassified] that are designed to assure my total knowledge and
control over all operations. My immediate purpose is to assure max-
imum concentration of effort while minimizing risks in the weeks re-
maining prior to the inauguration of a new President.
13. I have no objection to your showing this message to [name not
declassified].
Korry
3
An unidentified handwritten notation at the end of this paragraph reads: But Cf.
5. If episode provides link between U.S. and Alessandri campaign it equally establishes
the triangle: [less than 1 line not declassified].
57. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, August 28, 1970.
SUBJECT
ChileStatus Report
You had asked that I do a memo to the President asking him to ap-
prove contact with the Chilean cut-out to staff an action proposal in the
Phase 2 operation.
2
I have not done so because it is no longer neces-
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. Sent for information. Kissinger wrote, Lets have a 40 meeting
next week, in the bottom margin.
2
See footnote 1, Document 54.
378-376/428-S/80023
January 1September 4, 1970 161
sary. Both Ambassador Korry and the Station came back saying not
only was it unnecessary, but probably not fruitful to make this contact
before September 4. The cut-out will not know enough about the situa-
tion until then to provide the kinds of judgments the Station would
want.
Ambassador Korry and the Station haveinexplicably to mere-
vised their sense of urgency; they now say it is not only unnecessary
but undesirable to move immediately after the September 4 election.
They believe we have at least a week or so to get proper readings and
prepare without danger and think we should take that time.
CIA is disseminating to the 40 Committee principals this afternoon
a paper outlining possible operational alternatives to meet specified sit-
uations, and posing the question of whether to proceed, how and
when.
3
Agency views on the paper will be available Monday.
My reading is that there will be disagreement among the prin-
cipals on the whole idea. You therefore have two options: (a) a 40 Com-
mittee meeting to thrash out the views; or (b) try to staff a paper to the
President with the various views embodied.
My own impression is that this is such a delicate and complicated
question, and feelings sufficiently deep, that a meeting is very desir-
able. I do not believe that staffing it as a memo can give you the feel for
it you should have, or that it will meet all of the principals desire for a
hearing.
I will know better when I see the paper and learn more of the
agencies views, and will have a firmer recommendation for you later.
3
The paper is Document 16 in Foreign Relations, 19691976, vol. E16, Documents
on Chile, 19691973.
378-376/428-S/80023
162 Foreign Relations, 19691976, Volume XXI
58. Memorandum From the Assistant Secretary of State for
Inter-American Affairs (Meyer) to the Under Secretary of
State for Political Affairs (Johnson)
1
Washington, August 31, 1970.
SUBJECT
Options in Chilean Presidential Election
Attached is a CIAformulation of covert options open to us to influ-
ence the choice of a president in Chile after the general elections on 4
September and before the Chilean Congress on 24 October selects a
winner from the two leading contenders.
2
The proposals for action, all
aimed at preventing an Allende victory, would have no applicability
unless Allende ran first or second on 4 September. Nor would they
have practical effect unless Allende were a close winner or a close loser
on 4 September; our Embassy in Santiago supports the view that if Al-
lende wins the general elections by more than 100,000 votes there is no
course open to us that would prevent Congress from choosing him, and
that if Alessandri (or, almost inconceivably, Tomic) won by a similar
margin he would almost surely be chosen.
The options open to us if Allende is a close contender are framed
by CIA as follows:
1) Take no action.
2) Take limited action by continuing the present propaganda cam-
paign or by acting directly to influence the congressional vote, or both.
Ambassador Korry supports the combined approach. The instrumen-
tality for this work with Congress would be [1 line not declassified],
whom CIA has used in the past and whose discretion it trusts, as does
Ambassador Korry. Execution of the project could be entirely sublet
to [name not declassified] or CAS could participate closely in the formula-
tion, guidance and control of the enterprises [name not declassified] un-
dertakes. In either case [name not declassified] would coordinate his ac-
tivities with both Frei and Alessandri; he would put pressure on and
pay persuadable Congressmen; and he would monitor the attitudes
of the Chilean military. The CIA paper suggests that if the project were
sublet to [name not declassified] he might be paid an initial [dollar amount
not declassified] and another [dollar amount not declassified] if Allende
lost.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile
CIA #2. Secret; Eyes Only. The memorandum was sent through Coerr.
2
The paper is Document 16 in Foreign Relations, 19691976, vol. E16, Documents
on Chile, 19691973.
378-376/428-S/80023
January 1September 4, 1970 163
3) Broaden (2) by acting also with other covert assets in the polit-
ical parties and in the military. This course, the Agency notes, would
have more risks without appreciably increasing our leverage on
Congress.
The Agency says that the slightest revelation that we were un-
dertaking political action against the Chilean Congress would mean a
certain Allende victory and would seriously affect U.S. credibility in
the world at large. The Agency sees much less risk in a continuation of
the propaganda campaign, which thus far has showed itself to be a se-
cure operation.
Continuation of the propaganda campaign would cost about
[dollar amount not declassified] attempts to influence Congress [dollar
amount not declassified] use of further broad option assets [less than 1
line not declassified]. Total cost: [dollar amount not declassified].
The Agency asks that the Committee direct which option it wishes
followed; and whether direct contact with Chileans is authorized in
order to get the intelligence required for a political action program.
ARAINR/DDC Appraisal
The propaganda campaign was authorized by the Committee in
June; it is in full swing and apparently has not been compromised.
ARA and INR/DDC are in no position to say that it has been ineffec-
tive. We therefore have no objection to its continuation. We do oppose
the proposal (even were it successful) to work directly on Congress-
men, a proposal that plainly has as its central intent the purchase of
Congressional votes.
Ambassador Korry has emphasized, and ARA and INR/DDC are
well aware of, the grim consequences to U.S. interests of an Allende vic-
tory. (The Ambassador does note that some observers, including Ales-
sandri himself, take a more moderate view of the future were Allende
to win.) Buying Congressional votes, however, is a qualitatively dif-
ferent matter from the political action we have previously undertaken
in Chile. It means interference with and corruption of a principal insti-
tution of the Chilean Government and of a constitutional function that
lies at the heart of the Chilean political process. The gravity of a step of
the sort proposed makes the costs of exposure proportionately high.
Were the operation exposed, we assess the damage to USG domestic
and world credibility as being unjustifiably great.
We take a different view of the risk of exposure than does Ambas-
sador Korry. We think it prohibitively high. The principal if not the
only instrument for our action with Congress would be [name not de-
classified]. The Embassy and [less than 1 line not declassified] affirm the
highest confidence in his discretion, [1 line not declassified] ARA and
INR/DDC, on the other hand, fear that [name not declassified] has be-
378-376/428-S/80023
164 Foreign Relations, 19691976, Volume XXI
come sufficiently identified with the USG that untoward political activ-
ities or expenditures on his part would give color to suspicions,
charges, and ready belief that he was acting as a U.S. agent. [8 lines not
declassified]
The buying of congressional votes is a far more sensitive operation
than a propaganda campaign, and would have penalties for disclosure
far more heavy and wide-ranging. [1 line not declassified] ARA and
INR/DDC recommend strongly against putting the reputation of the
administration and of the U.S. into the hands of one Chilean citizen,
who, although he has justified our confidence hitherto by not revealing
our part in covert political action, [1 line not declassified].
Even were we to reach 24 October uncompromised, the risk of ex-
posure would continue. Were Allende to lose, there would be, for ex-
ample, risk from Congressmen whose votes [name not declassified] so
closely linked with the US, sought to buy. Were Allende victorious, the
risk would be much greater, because of the possibility that he might
crack, and furnish evidence of our role in the Congressional election, to
avoid physical or financial retribution.
Recommendation
That we limit our covert activity after the 4 September general elec-
tions to continuation of the anti-Allende propaganda campaign, at a
cost not to exceed [dollar amount not declassified] the amount and the
manner of expenditure to be determined by the Ambassador.
Clearance:
INRMr. Cline. Mr. Cline, in clearing this memorandum, states
that if CIA considers [name not declassified] reliable and secure, and if
CIA can get [name not declassified] to outline his individual projects so
that we can judge their feasibility, he would invest [dollar amount not de-
classified] if that would make the difference between an Allende victory
or defeat. Mr. Cline believes that by the time leaks come, if they do, the
issue would be over.
378-376/428-S/80023
January 1September 4, 1970 165
59. Backchannel Message From the Ambassador to Chile (Korry)
to the Assistant Secretary of State for Inter-American Affairs
(Meyer)
1
Santiago, September 1, 1970.
1. My promised reply on Phase Two follows. (Assume you have
read election perspectives 6 particularly paras 14 and below.)
2
2. I see no reason to alter our plans. All that has occurred insofar as
Phase Two is concerned is that GOC has employed various means to
try to seal off US influence (including Frei as well as other possible
targets).
3. The shenanigans of [name not declassified] (who has leaked much
of what he talked to me about) and a great deal of similar official in-
nuendoing may reflect some genuine suspicion of US plans for inter-
vention and some sincere nervousness. More likely as I discussed in
[less than 1 line not declassified] (internal security and foreign policy) it
has to do with GOC motives for keeping left happy, whatever may be
the transitional cost in relations with US. GOC wants to be able to say
its skirts are clean, that election results were honest, that there is always
the traditional possibility of a defeated left doing deals with the PDC in
Congress to keep out Alessandri, and so on. It is also convenient to air
these rumors about the US since it tends to create climate in which criti-
cism of the govt is muted and responsibility for anyones defeat can be
shunted off to Anaconda, to the CIA, to anyone with US credentials.
4. The left for doctrinaire and other reasons is delighted to have the
GOC accede to its needs to justify future anti-US actions, be they
murder, kidnapping or anything else. The Marxist press is concen-
trating on Americans, unofficial or official. The one new element is that
El Siglo today indulges in an attack whose crudity is unusual for that of-
ficial party organ; because it compares me to Bedell Smith in his days in
Moscow,
3
it is evident that the Soviets are beginning repayment for Ku-
nakov Archives.
5. The sum of this gamesmanship is that I am theoretically more of
a eunuch. But since I never planned any direct dynamic role for myself
or for this Mission, nothing in fact has changed. Primary responsibility
is with the Chileans and our role should be limited to sound advice and
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only.
2
See Document 17 in Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973.
3
Walter Bedell Smith was Ambassador to the Soviet Union from 1946 until 1948.
378-376/428-S/80023
166 Foreign Relations, 19691976, Volume XXI
material backing to friendly Chileans. That was and is what Phase Two
is all about.
6. I am disturbed by the erratic missile named Gen. Viaux. What is
particularly worrisome is that one of the few known and effective influ-
ences in his current plotting [3 lines not declassified] we can expect a
great deal of unwanted trouble. [2 lines not declassified] has been trying
insistently for two weeks to get me together with the [less than 1 line not
declassified] before the elections at a very private gathering. I am
lunching with [name not declassified] at the residence [less than 1 line not
declassified] and I intend to give it to him straight, including the knowl-
edge that Alessandri and the Nacionales are extremely concerned by
[less than 1 line not declassified] because of its negative effect on the lead-
ership of the Armed Forces.
60. Memorandum From the Deputy Director for Coordination,
Bureau of Intelligence and Research (Coerr) to the Assistant
Secretary of State for Inter-American Affairs (Meyer)
1
Washington, September 4, 1970.
SUBJECT
ChilePost-September 4 Operations: A Personal View
1. Our basic problem, if the popular election of September 4 places
Allende in close competition for the presidency in the congressional
election of October 24, is to weigh the alternative risks to the U.S. that
would be posed by
a) an Allende government, and
b) our attempt to block his presidency by purchasing the votes of
Chilean legislators in their electoral capacity.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret. A copy was sent to
Cline. Printed from the unsigned carbon copy received by Cline. A handwritten notation
by Cline at the end of the memorandum states: As I have made clear before, I do not
agree with this analysis; I think Mr. Coerr is hung up upon the emotional overtones of the
word subornation. In the world of realpolitik sensitivities are not so tender and people
are more concerned with who wins power rather than with morality. I believe the shock
in the entire Western Hemisphere at the election of a genuine extremely articulate Com-
munist in a major Latin American countrythe first advent to power by the ballot any-
wherewill cause more alarm about security and strategic problems than about the mo-
rality of U.S. trying to exert influence.
378-376/428-S/80023
January 1September 4, 1970 167
2. The case for subornation has been well argued. In essence: Al-
lende hopes to establish a Marxist state, to expropriate U.S. investment,
to follow a foreign policy friendly to Cuba and inimical to the U.S. I be-
lieve we have not given enough weight to forces in Chile that might
frustrate his plansan intact military that has not oppressed or been
defeated by the people (unlike Cuba when Castro took power); and
powerful groups in labor, business and industry and on the land.
Nevertheless, the penalties of an Allende victory would obviously be
heavy.
3. In attempting to assess the penalties of being caught in our pres-
ently proposed operation, I believe it helpful to compare them with our
hitherto most costly Latin American failure in covert operationsPigs
Bay. The American President was able to assume responsibility for that
operation. I doubt he could do so for subornation of the Chilean
Congress and electoral system. Such action is beyond the pale, and evi-
dence of our involvement would hurt our prestige and effectiveness in
Latin America (not to mention the United States Governments reputa-
tion with its own citizens) even more than did Pigs Bay. I assess the po-
tential penalties of subornation as greater than those of an Allende
victory.
4. As our chosen instrument for bribery, [name not declassified] is ex-
cellent. He has demonstrated discretion over the years, but in the com-
paratively minor leagues of covert propaganda and political support,
and under comparatively benign governments. Our proposed suborna-
tion is far more dangerous to him, and to us in this matter. So would be
an Allende government. [5 lines not declassified]
5. We can always deny accusations, whether false or true, but if ac-
cusations in this case were supported by evidence our denials could not
avert the heavy penalties involved. The only sure way to do so is to re-
frain from subornation.
378-376/428-S/80023
168 Foreign Relations, 19691976, Volume XXI
61. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 4, 1970, 2015Z.
3483. Subject: Election Eve Talk with Frei.
1. (Summary) I met with President Frei at his invitation for three
hours last night in home on Santiagos outskirts of Minister of State
Raul Troncoso (whose office is few feet fromPresidents). We discussed
election prospects, his concern over military plotting, his mild suspi-
cions of US military intentions, his good relations with US, his suc-
cessful intervention at my behest to stop or delay NY Times publication
today of provocative story concerning Pentagon contingency planning
behind State Departments back,
2
and pessimistic prospects in Chile.
Dept should bear in mind that when Troncoso called me previous eve-
ning to extend invitation, I seized opportunity to alarm deliberately
President re impending Times story on US Navy. This message includes
recommendations for prompt Presidential cable to Frei on elections
and suggestions for Depts handling of Times. (End summary).
2. I recalled that no wind works for the man who has no port of
destination as I talked with a Frei who pragmatically recognizes that
the fate of Chile is in the hands of the more than 3,000,000 Chileans who
are voting today. Still the powerfully attractive man I have always
found him to be, still the total politician who revels in the game, still as
pragmatically realistic as befits one of the few PDC leaders who has
kept a true democracy functioning, he was nonetheless profoundly
pessimistic and perturbed. He paced the entire three hours in the small
living room, stepping over my ungainly limbs as he went round and
round the coffee table, puffing on the two missled Cuban Churchills or
sipping from the one defused scotch he consumed.
3. He had barely entered when he asked with characteristic forth-
rightness: who is going to win; I replied that I believed Alessandri
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Immediate; Nodis.
2
A reference to the article by Tad Szulc which was published in the New York Times
on September 5 under the headline U.S. Navys Visa Requests Worry Chile. Szulc re-
ported that the U.S. Navy had applied for Chilean visas for 87 officers, noncommissioned
officers, and civilian employees over the last eight months, a development that has left
the Chilean government deeply worried. The story contained no reference to Pentagon
planning behind the back of the State Department as noted in the cable, but reported
rather that the Navy often applied directly for visas for routine activities without con-
sulting the Department. The Navys explanation of the 87 visas was that 38 were for Navy
personnel assigned to Antarctica and 49 were support personnel for Operation Unitas, a
yearly joint naval operation between the United States and Latin America. (Tad Szulc,
U.S. Navys Visa Requests Worry Chile, New York Times, September 5, 1970, p. 3)
378-376/428-S/80023
January 1September 4, 1970 169
would gain no less than 38 pct, that Allende could not realistically hope
for more than 35 pct and that Tomic might surprise the Marxists by
squeezing in second, thus making it a tighter all round race. For a few
moments he sank into a morose silence, the most visibly affected in my
experience of three years.
4. Finally he began to play with the numbers and their implica-
tions. He had no great love for Tomic and he disagreed with his policies
almost totally. Nonetheless he was profoundly convinced that the tri-
umph of either Alessandri or Allende would be far worse for Chile. An
Allende triumph would without any doubt mean the imposition of a
Marxist-Leninist state. It was an irreversible road; it was the end for
Chile and it was the end for him and for everything he had labored. An
Alessandri government would lead to rapid polarization of Chile; it
would push the mass of the Christian Democrats to the left; it would
destroy the center; Alessandri was himself a smart politician but he
was surrounded by so-called Independents whose avarice was only
equalled by their stupidity and arrogance; the latter would quickly
settle back into their business-as-usual attitudes and seek vengeance on
the Christian Democrats by offering the Communists a free hand in the
universities and trade unions in return for a pledge of labor peace; they
would halt Freis kind of land reform and accompanying measures and
would destroy the painfully fashioned canals of social progress and
justice he had constructed as a diversion from Marxism and violence.
5. He had no animus against Alessandri. But the fact was that as
President in 1958 to 1964, Alessandri had worked barely four hours a
day. Chile had become far more complex, although nothing in com-
parison with the complexity that President Nixon had to confront; a
Chilean President who did not follow closely all that transpired could
not steer a purposeful or steady course. He would be manipulated by a
small group of cronies whose sole interest was their individual in-
terests. As for those who speculated that Alessandri might not long sur-
vive, he felt that men with the ex-Presidents history of psychiatric
problems and with his degree of nervousness usually outlived their
doctors.
6. Tomic had made the profound error of tactically assuming Ales-
sandri would not stay the course; Tomic had thought less about being
elected than of resolving the problems of governing via his electoral
campaign. Only very lately, he had realized the possibility of error but
it was probably too late to rectify. Frei said he was never more uncer-
tain about an election. He would not be surprised if any of the three
won or even if there were an absolute draw among the three. What I
had told him was very upsetting because he genuinely believed that I
was the best political observer of Chile and that he had waited until
election eve to hear my conclusions because he wished them to be the
378-376/428-S/80023
170 Foreign Relations, 19691976, Volume XXI
ultimate, particularly because he was bombarded by such conflicting
reports.
7. He had hoped against hope that Tomic had a good chance. If he
finished third, it would be universally interpreted as a rejection of all
that he (Frei) and his government had sought to accomplish. From all
over the non-Leninist world, he had been given nothing but high marks
for his regimefrom countries as different as Yugoslavia and Japan, Is-
rael and France, Spain and the US, West Germany, Britain, Italy and all
the others. How could anyone explain that good government and per-
sonal popularity resulted in such a defeat and in such frightening per-
spectives for the country?
8. I sought to provide consoling answers. Everyone knew he
would win in a landslide if he were running; everyone knew that
Tomic had spurned his whole-hearted efforts to help; everyone knew
and would also write that it was Tomics tactics and personality that
had been the primary causes of defeat, if indeed it were to be defeat.
The latest indications were that Tomic was gaining last-minute
strength with the populous Central Valley campesinos, that he was
making equal inroads among middle-class women and low income
groups in Santiago and that he could yet make a run for it. The Presi-
dent commented that it would be less deplorable if Tomic at least fin-
ished second. He believed that whoever won by 100,000 votes would be
President although he said that some in the PDC would stretch that
margin of interpretation, if Tomic were second. If Allende were first,
Congress would not elect Alessandri. He saw little possibility, contrary
to US press speculation, that the PDC and Popular Unity forces could
make an effective alliance to overturn an Alessandri victory.
9. He was much more concerned about the military. He had re-
ceived word that day that for the first time truly alarmed him about the
militarys intentions. He had fairly hard information that a plot was
well developed to have the army seize power if Alessandri lost. I inter-
rupted to ask if he meant a plot contingent on Allendes victory. No, he
repeated, his information was that this group intended to move too if
Tomic triumphed. He said the information provided him was the most
serious and the most disturbing about the army in his entire six years in
office and he included last Octobers fuss in the army. I asked if he was
talking about the leader of the October dissidence, Gen. Viaux. No,
Viaux was not a serious menace although he was very active. Well, I in-
quired, who then? He said he would prefer to have his information
double-checked before mentioning names but he could say well-placed
active officers supported by some retired personnel were involved.
Comment: We have no rpt no intelligence to support the Presidents
statement. There are to my knowledge advanced plans involving the
service and Carabinero chiefs to solidify an Alessandri triumph by a
378-376/428-S/80023
January 1September 4, 1970 171
prompt symbolic act of recognition. Frei points in quite another direc-
tion and for the moment I must consider it with skeptical reservations.
While there are officers committed to Alessandri who regard Tomic as
indistinguishable from Allende, they do not, to the best of our knowl-
edge, represent any effective force that could mount a revolt. End
comment.
3
10. I said there were many rumors and reports with little substanti-
ation floating about. Indeed some concerned the US and had contrib-
uted to a feeling of mutual suspicion that had in my opinion affected re-
lations between our two countries. It was less content of action than the
style in which they were effected that was so annoying, the latest ex-
ample concerning the innuendoes about the US Navy. I reviewed that
situation, stating I was convinced the Chilean Embassy had deliber-
ately leaked this news in a fashion designed to reach the NY Times. The
same route had often been traveled in the past by Latin Americans to
Tad Szulc of the NYT.
11. Frei replied he had always been totally candid with me and that
he wanted me to know that I was wrong. He launched into an uninter-
rupted 30 minute review of rels with the US in which (a) he reiterated
his conviction that Chilean foreign policy starts with the absolute ne-
cessity for good rels with the US; (b) no President in Latin America had
received more effective or more comprehensive support than he had
from the US; (c) no President in Latin America had so consistently
voiced public recognition of the US contribution or had avoided so as-
siduously any criticism of the US including an absolute silence on Viet-
nam or other embarrassing subjects; (d) no President to his knowledge
had recognized and acted so promptly to rectify mistakes and errors
committed by his govt in its rels with the US as he and he was certain I
was most aware of his responsiveness and of the confidence he had
thus demonstrated in me. Hence he felt it was only just that he explain
his point of view.
12. As soon as I had spoken to Troncoso Wednesday night he had
called Amb Santa Maria in Washington. I would have to consider him
(Frei) a cretin to believe that anyone in the GOC or interested in the
election of Tomic as Santa Maria was to engage in so suicidal an act.
3
In an undated backchannel message, Korry added, 1. I requested ARMAthat info
transmitted to and from me by him not rpt not be transmitted through his channels nor
be discussed in his office here with anyone. 2. In my election eve talk with Frei, who had
raised ill-founded talk of coup planned to overturn a Tomic victory, I told President that
if Tomic received first majority and if I happened by chance to hear of such plotting, I
would promptly inform him. However, I added that if Allende were first and similar talk
came to my attention I would not inform him, although I wished him to know the U.S.
would not provide any support for such military intervention. Frei did not question these
statements. (National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970)
378-376/428-S/80023
172 Foreign Relations, 19691976, Volume XXI
Publication of the NYT story about Pentagon planning behind the
back of the State Dept could only help Allende. Santa Maria had un-
derstood that immediately and had taken an oath that he was not in-
volved. Santa Maria had worked all through Wednesday night and
Thursday to halt publication of the Szulc story; and he was delighted to
be able to inform me that the NYT had (a) provided Santa Maria with a
summary of the story it had planned to run election day; (b) agreed to
delay its publication upon being persuaded by Frei that it could seal the
defeat of democratic forces in Chile; (c) Szulc had stated and had
written that the Dept was the source of the story and (d) Szulc had
stated the Dept had made no effort to halt the story.
13. He wished me to understand that when Allende had visited
him last week with his campaign managers, the first subject raised by
the Marxist candidate was the extraordinary influx of Americans into
Chile. Frei said one of his greatest preoccupations was that if Allende
was defeated he would cry fraud and with victory would accuse the
GOC of conspiring with the US to rob him of the election by military or
other intervention. Hence Frei wished to be in a position to demon-
strate the GOC had taken every possible action to prove its skirts were
clean. It was a fact, he said that some of the US Navy visaed had ar-
rived; it was a fact that there were some 2000 or 3000 more US citizens
in Chile this year than in the last few at this season and there was also
an equally great number of Argentines. It was the facts that lay behind
the GOC request to US to provide the names of all Americans in
country.
14. He confessed he did have some doubts about the US. He con-
sidered the action of the Embassy in this entire election year to have
been the most exemplary imaginable, the most intelligent conceiv-
able and he wished me to know that the entire govt and most in-
formed Chileans had nothing to say about me and the Emb except to
offer the most hearty round of applause. However he had read a great
many books by American statesmen and he knew that the Dept often
did not know what was being planned in the Pentagon. He hoped I
would forgive him this suspicion and this candor. It was there and it
was much stronger in many other Chileans. He recognized that Chile
was only an insignificant country of some 9,000,000, that it was intellec-
tually silly to believe the US would care that much, but after all the vic-
tory of Allende would affect all Latin America and it would touch US
interests. It was not one of his greatest preoccupations but it meshed
with the profound one of what would be the reaction to the election re-
sults by the Marxists. Hence he had now given the order world-wide to
suspend all granting of visas for a period of one week starting yes-
terday and that visas could only be approved individually by Ministry
Foreign Affairs.
378-376/428-S/80023
January 1September 4, 1970 173
15. He said incidentally that the US would have the best prospects
of good relations with Tomic of any of the candidates. Tomic was pas-
sionate about the need for such relations and while there might be
some ups and downs in the first six months, a Tomic regime would
settle down to uninterrupted mutual confidence with the US. With Al-
essandri, there would be such disappointment in the US when his govt
began to squeeze US companies, when he sought to placate the Com-
munists and when he failed generally to infuse dynamism or to main-
tain order, that there would be many difficulties.
16. In reply I accepted his position although I hoped he would
pardon my unabated suspicions as to how the story was leaked. He
was one thing; some of his collaborators were another. What bothered
me was that the suspicions about the Navy were an extension of many
other actions which had quite honestly led me to entertain doubts as to
the veracity and motives of some in his govt. His dis-invitation to his
lunch a fortnight ago had strengthened these doubts and I had la-
mented most the seeming loss of his confidence. I had repeatedly told
the GOC that (a) I assumed full responsibility for the entry of all Amer-
icans; (b) the USG had no rpt no plans for any military intervention of
any kind in Chile; (c) I had requested and the Dept had complied in the
extraordinary process of detailing each visa already granted the Navy
because of our awareness of the nervousness; (d) I knew of none of the
visaed Navy personnel that had entered the country despite the con-
trary assertion by UnderSec Foreign Affairs Silva who had failed to
provide me as promised with the names of any of the six he said had in
fact arrived; (e) I was unaware of any great influx of Americans and I
had the greatest doubts as to the facts but Chile had launched a tourist
drive in the US this year and it was the first in three years there was
snow for skiing here. Also I wished him to see our note of July 27th to
his Foreign Ministry requesting permission for 24 US Navy air crews to
make flights over Antarctica from Chile for scientific purposes;
4
there
was no secret about our actions and I resented the implications that the
USG was engaged in any unusual action. He was aware of my re-
buffing attempts by Gen. Viaux and even active military officers to
draw members of the US Diplomatic Mission into discussions con-
cerning Chilean military contingencies. I had given the most cate-
gorical assurances and the GOC had not accepted them. The implica-
tions were serious.
17. The President said he accepted them now without reservation.
He was relieved. We continued to talk about the elections and about the
probability of a strenuous MIR reaction to an Allende defeat with
greater Socialist support than ever. We discussed ways of improving
4
Not found.
378-376/428-S/80023
174 Foreign Relations, 19691976, Volume XXI
our liasion in this field. He explained away the lunch dis-invitation as
due to a change in the size of the affair.
18. Recommendations: That in the event of a victory by Alessandri
or Tomic, President Nixon send a cable to President Frei tomorrow con-
gratulating him on the impressive example of democracy in action. No
rpt no cable should be sent to any candidate whatever his margin since
it would be a direct intervention in the constitutional process involving
a congressional runoff. No rpt no cable should be sent in the event of an
Allende victory until we all have time to reflect.
19. Suggestion to Dept: I would urge most strenuously that you
communicate promptly to Szulc that we have sorted out most of the
names and purposes of the 87 Navy request24 concerned with our
note of July 27 to the MFA requesting the flights as part of the National
Science Foundation Antarctic Research Program, 49 as part of the
Unitas Transit visit per Embtel 3473,
5
and presumably the remaining 14
for routine Antarctic relief by sea from Punta Arenas. I so suggest in the
hopes that even Szulc would have the honesty to include these facts
and thus rectify the impression conveyed by his story and by the De-
partment that we do not know what the Pentagon is up to. The fact is
that the Embassy did know and the Chilean Govt was informed about
most of it, since it had the aforementioned note and my oral communi-
cation about the Unitas band cum crew. It is [in]comprehensible to me
why these routine matters require almost two weeks for clarification. It
would be the rashest of imprudences to permit a malicious story based
on nothing to do the kind of damage that it might wreak here.
Korry
5
Telegram 3473 from Santiago, September 3. (National Archives, RG 59, Central
Files 197073, DEF 9 US)
378-376/428-S/80023
Two Tracks: U.S. Intervention in the
Confirmation of the Chilean President,
September 5November 4, 1970
62. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 5, 1970.
1. Chile voted calmly to have a Marxist-Leninist state, the first na-
tion in the world to make this choice freely and knowingly. Dr. Sal-
vador Allende proved the wisdom of Soviet policy in Latin America by
scoring the revolutionary tactic of his model, Fidel Castro, to pursue an
electoral path to power. His margin is only about one percent but it is
large enough in the Chilean constitutional framework to nail down his
triumph as final. There is no reason to believe that the Chilean armed
forces will unleash a civil war or that any other intervening miracle will
undo his victory. It is a sad fact that Chile has taken the path to commu-
nism with only a little more than a third (36 pct.) of the nation ap-
proving this choice, but it is an immutable fact. It will have the most
profound effect on Latin America and beyond; we have suffered a
grievous defeat; the consequences will be domestic and international;
the repercussions will have immediate impact in some lands and de-
layed effect in others.
2. We have been living with a corpse in our midst for some time
and its name is Chile.
2
The decomposition is no less malodorous be-
cause of the civility which accompanies it. Chileans could as usual
chatter endlessly on television and radio and in the early hours today
as if nothing had changed and the screen switched from variety shows
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II, Jan 70Nov. 70. Confidential. The document
is printed from a retyped copy of telegram 3499 from Santiago, September 5, 0858Z. This
copy of the telegram was submitted to President Nixon under cover of a September 9
memorandum from Kissinger stating the following: Attached is a cable from Ambas-
sador Korry commenting on the Chilean election. It was written on September 4, as the
final results became known. It is an important cable which I think you will find of in-
terest. In it Korry notes that Allendes triumph appears final; he notes the mistakes of his
opponents that permitted the Marxists triumph. He describes the characteristics which
he believes will make it relatively easy for Allende to bring about a socialist state within
constitutional framework. He observes that the political and economic right can be elimi-
nated, and the military neutralized. He also notes that Chile is isolated; that it can survive
with no commitment from anyone. At the bottom of the memorandum, President Nixon
wrote, An excellent perceptive job of analysis. (Ibid.)
2
Nixon underlined this sentence.
175
378-376/428-S/80023
176 Foreign Relations, 19691976, Volume XXI
to roundtables of politicians pontificating as foolishly as ever. Chileans
like to die peacefully with their mouths open.
3
3. Preliminary analysis of the results (I write this with votes still to
be counted but the stink of defeat is evident and the mounting roar of
Allendistas acclaiming their victory arises from the streets below) show
that Allende got every bit of the 35 pct. we had feared plus more
women in the low income neighborhoods. He also benefitted from the
switch in Santiago of middle class women from the aging Alessandri to
the prattling Tomic. In their majority the females opted for law and
order as represented by Alessandri, but enough thought they had
nothing to lose with Allende and others were seduced by the lure of the
center where Tomic stood.
4. Allende did not equal his 39 pct. of 1965. He did not come close
to the 46 pct. that was the sum of the parties that formed the Popular
Unity. It is obvious that the clientele of the Radical Party deserted him
in droves. But it is equally evident as I wrote on election eve that 65 pct.
of Chile is anti-right and Alessandri was so identified with that position
that he could gain the predictable 5 pct. minimum and no more.
5. There were no surprises in the year-long campaign, no sudden
events that affected voters decisions. We erred by one percent on Al-
lende, predicted the Tomic vote and were only 2.5 pct. off on the Ales-
sandri prediction. But the Communist Party, whose leadership has
been matched by the coldness of its calculations predicted the Allende
vote as 36 pct and the Alessandri tally as 4 pct. They were almost dead
on target. If anyone thinks that such a party will not fully exploit the Al-
lende Presidency to impose on Chile a communist structure, I suggest
they ponder the dead reckoning of these cool customers. I would also
recommend that they reflect upon the ease with which the BVIU
[garblePCCh?] took absolute control of some 80 pct of the more than
8,000 Popular Unity committees that were formed in the country for the
campaign, with what facility they managed the formation of the
phoney popular front and with what skill they steered their choice, Al-
lende, into the nomination of the heterogeneous grouping.
6. The potency of the Communist Party and the poverty of the
Christian Democratic Party (PDC) can best be seen with regard to
Cuba. The PCCh convinced Castro to play their game, to call off the
Mod Squad of Socialist extremists known as the MIR and thus deprive
Alessandri of much of the law and order issue on which his campaign
was so largely rested. The PDC through that No. 1 grave-digger of
Chilean democracy, Foreign Minister Gabriel Valdes, chose to appease
3
Nixon underlined this sentence.
378-376/428-S/80023
September 5November 4, 1970 177
Castro.
4
Just as he argued with us that the way to contain Castro was to
give a free hand and to assimilate Cuba, so too did he and the PDC
hand the shovels for their own graves to the left in Chile. They ceded on
every issue this year to the PCCh and to the Socialists; they played the
card of anti-Americanism and legitimized Castro and the left. They
considered me innocent and uncouth for pointing out that they were
not harming the US but destroying themselves. They should be given
neither sympathy nor salvation. Mistrust is indeed the mother of
safety and I cannot imagine wisdom without it.
7. I have confessed repeatedly in these communications my equal
distrust of a Right that blindly and greedily pursued its interests, wan-
dering in a myopia of arrogant stupidity. They disdained organization
and deliberately scorned the one element of their forces that had some
semblance of structure, the National Party. The preached vengeance
against the Christian Democrats whom they regarded as a more justifi-
able enemy because of its betrayal of class than their class enemy, the
Communists. They fought the first rule of nature, of change, and inso-
lently believed that time stands still. They only tolerated the few mod-
ernists in their midsts, men who were certainly no less rich, no less
self-interested, but who at least understood the flux in which we are all
caught.
8. Allende was smarter. He was persuaded by the Communists to
stick to bread and butter issues, to project a personality with broader
appeal than a rigid and cynical doctrinaire. With 60 pct of Chile still
poor and with inflation and unemployment the rock-bottom electoral
issues, it is truly surprising that only 36 pct. voted for him.
9. We too were misled by the polls I have so often mocked. The
Gallup and much respected CESEC polls were way off the beam. They
predicted 41.5 pct for Alessandri and although the Embassy calculated
an actual vote of 36.5 pct. for Alessandri, I was enough influenced by
these foolish samplings to increase the projection to 38 pct. Voters are
not Gaderene swine; in a society with 90 pct. literacy, they can be quite
bloody-minded about their interests. And when the candidate of the
government party preaches that the system in which they live is rotten
and issues the call for revolution, it is not surprising that enough decide
to place their faith in the genuine article.
10. I briefed the US press a few days ago on why I was convinced
beyond any doubt that Chile alone in the western and democratic
world had the objective conditions to permit a unique constitutional
transition to a Communist state by an Allende government without the
usual rough stuff. The ten reasons are:
4
Nixon underlined this sentence, and wrote in the left margin, K[issinger] note!
378-376/428-S/80023
178 Foreign Relations, 19691976, Volume XXI
a. Allende and his Socialist Party and the PCCh have a revolu-
tionary program that is the product of a lengthy evolution in the
country. They have the conviction, the organization and the power
base.
b. The Presidency of Chile has almost unique powers and with the
latest constitutional reform that will take effect with the new gov-
ernment, that authority will be further strengthened.
c. The bureaucracy of Chile is statist-minded and the majority of
congress is very amenable to further state control.
5
There has never
been much true private enterprise in Chile and the large businesses
have also depended on government favor for their profits, their initial
capital and their protection. Proposals to nationalize foreign enter-
prises and the critical banking and insurance sector will not encounter
serious opposition.
d. The big business sector of Chile is fragile and thinly based. It can
be eliminated with far greater ease than in, say, a France or Italy.
e. The political right depend upon the economic right.
6
The elimi-
nation of the latter dooms the former. And as this process proceeds,
will tear apart the PDC in the same salami-slicing method that the
Communists employed these past six years in a totally free society to
destroy that other mainstay of the center, the Radical Party.
f. The free press in Chile is represented primarily by the El Mer-
curio group. This enterprise, owned by Augustin Edwards supported
Frei in 1964 and since. This time it went all out against the Communists
and became the great thunderer for Alessandri. It is doomed. And it
means the only respectable journal in the country plus a large number
of satellite newspapers in Santiago and through the country. It will be
eliminated not by nationalization, I predict, but by an irresistible
squeeze through the governments control of paper supply and prices,
the governments use of advertising and the disappearance of mean-
ingful and free private enterprise. Democracy depends ultimately on
the freedom of expression. To still the loudest voice is to silence dissent.
Of the three TV channels in Santiago, in a still free society, one is totally
controlled by the Marxist-Leninists of the University of Chile, another
is controlled by a combination of Marxists and very left wing Christian
Democrats of the Catholic University and the third is the States.
7
5
Nixon underlined this sentence.
6
Nixon underlined this sentence.
7
Nixon underlined the last sentence of the paragraph. In the left and bottom
margin he wrote, The Key. K[issinger]I want a study of major T.V. stations in all major
European countries + JapanHonestly analyzing what the makeup of their staffsDo it
confidentially through Shakespeare.
378-376/428-S/80023
September 5November 4, 1970 179
g. Chile has an almost unique system for the naming of its military
command. Not only does the President have the greatest influence on
the selection of service and carabinero chiefs but more significantly the
officers selected automatically retire all those over whom they have
passed on the seniority list. No more facile instrument was ever de-
vised to eliminate by legal and traditional methods a broad chunk of
opposition.
h. Economically, Chile is in the best shape ever. It has $500,000,000
(M) in hard reserves, more per capita than the US. Starting next year it
will be the second largest copper producer in the world, surpassing the
Soviet Union, thanks to the enormous investment of US companies.
There will be no lack of markets; Chiles prime customers are western
Europe and Japan. As in the case of Cuba, these mercantilist nations
will happily be ready to pick up basement bargains on copper. An Al-
lende regime will also save a large outflow of hard currencies in profits,
amortization, license payments and may even default on the three/
quarters of a billion dollars that it owes to AID and the Ex-Im Bank. The
point is that it need not face any economic squeeze for some time.
i. Chile is really an island. Its three neighbors have sufficient
problems to eschew any pressures on this country.
j. There is no country on earth that is so far from the two super-
powers and Red China. It is not Poland nor is it Mexico.
11. In sum, it will not require any massive commitment from
anyone. The Soviet Union will move with caution to expand its base. It
need not risk much soon. Chile is not another Cuban drain on
Moscows resources. It will take years before the dead-weight of the
new system will crush the economy of the country.
12. It is lamentably the US that will have to move faster. Tomorrow
we shall report on the measures we are taking to prepare for the new
era.
13. Leadership depends upon, if I may use the Spanish, cabeza, co-
razon, and cajoneshead, heart and guts. In Chile they counted upon
chacharachatter.
378-376/428-S/80023
180 Foreign Relations, 19691976, Volume XXI
63. Message From the Central Intelligence Agency to the Chief
of Station
1
Washington, September 5, 1970.
1. Now that Allende has won the election we must take another
look at the situation in connection with Phase II to see if earlier supposi-
tions, reasoning and rationale for our plans and actions are valid, par-
tially valid or if totally new concepts pertain. In this exchange we are
aware of your previous thoughts and those of the Ambassador on
chances of overturning an Allende victory. What we are looking for in
this message is a reaffirmation of those positions and/or your current
thoughts now that Allende is the winner. The points below are based
on the assumption that Alessandri has not and will not concede victory
to Allende. If he concedes, we further assume that nothing can be done
to influence the outcome of the congressional vote.
2. We would like you to consider at least the following questions
plus any others you consider pertinent:
A. How has the utility of [name not declassified] been affected by Al-
lende victory: does he still have some influence with Frei to encourage
him to try to swing PDC votes to Alessandri? If so, is he likely to be suc-
cessful on his own or would he have to be acting in name of USG? [7
lines not declassified]
B. What is Freis future in Phase II as result of Allende victory and
poor showing by Tomic? Is he apt to act on his own to line up PDC
votes for Alessandri? If not, would he be inclined to act if directly ap-
proached by Ambassador with personal request from President Nixon?
What influence does Frei now have with military if he should decide
coup is only way to prevent Allende inauguration? Is he likely to con-
sider this out?
C. Again, we would be interested in your thoughts and Ambas-
sadors on likely outcome of congressional vote even though we realize
it must be speculative at this early point after election. Will radicals
now consider it in their interests to support Allende instead of de-
fecting to Alessandri per earlier forecast? How many PDC Con-
gressmen are likely to vote for Alessandri under maximum pressure
from President Frei? How many are likely to vote for Allende if Frei
makes no effort at all to influence the result?
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only. The message is a copy provided to the National Security Council
staff. Although an unidentified staff member wrote on the copy that it was addressed to
Korry, it is clear from both the text and the reply (see Document 64) that the message was
sent to the Chief of Station.
378-376/428-S/80023
September 5November 4, 1970 181
3. FYI: The 40 Committee has scheduled meeting for afternoon of 8
September to consider Chilean situation.
2
Since we must prepare posi-
tion papers for 40 Committee meeting prior this date need your reply
by 1200 hours 6 September.
3
4. In summary we must now answer the question: Is any form of
Phase II feasible and, if so, what are prospects for success and what are
the risks? Please discuss above with the Ambassador, but we want
to emphasize we do not repeat not want you to discuss these points
with anyone repeat anyone outside the Embassy. Points raised in this
message have been coordinated with Deputy Assistant Secretary
Crimmins.
2
See Document 70.
3
See Document 64.
64. Message From the Ambassador to Chile (Korry) to the
Central Intelligence Agency
1
Santiago, September 5, 1970.
1. CAS has just presented your message.
2
I have directed him to
take no action for the following reasons:
A. Key Chileans including Frei who is currently meeting with his
closest advisors are in a state of shock. It is not an easy thing to lose
ones country and we should not lose our heads before they recover
theirs.
B. Most of the questions you have posed we have been actively
considering during the night and today. We are formulating ideas that
we shall present to you when we are more certain that there is at least a
modicum of reality involved. After having lost on one psychiatric
problem, if only because of his refusal to entertain the PDC proposal
many months ago for a popular run-off vote, I do not intend to cater to
anyones neuroses at this point in time.
C. I have taken steps already to condition Frei, to persuade Ales-
sandri not to issue any cession statement re Allende (which he has not
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only.
2
Document 63.
378-376/428-S/80023
182 Foreign Relations, 19691976, Volume XXI
yet done), to hear [name not declassified] views and to keep Viaux from
precipitating ill-calculated actions. These are minimal steps prepara-
tory to clearer later assessments.
D. I have no realistic hopes that there will be a Phase II along the
lines originally conceived. I am willing to consider carefully any
scheme that will fit the circumstances but I would guess that we would
probably be dependent on an entirely new Phase I and II cycle that we
are turning over in our minds currently. We have already engaged in so
much useless paper spinning of possible contingencies that I am not
amenable to more such exercises.
2. I would strongly urge that the Committee of Forty postpone
their meeting for several days until the situation is more clearly per-
ceived. There is no risk in waiting; there is risk in half-baked ideas that
could be self-deluding. In the interim we shall continue to operate
within the understood guidelines.
3. In that connection I wish to state emphatically that despite our
profound disappointment we have worked at maximum effectiveness
and without any risk to the USG or to the person of the President. I take
great pride in the fact that our coordinated efforts have produced the
encomium of Freis cited in my cable of 24 hours ago
3
and of Allendes
statement to a US newsman as reported in another Embtel.
4
We did all
possible. There is nothing I regret having done or not having done. And
I would ask only that you now give us the time to locate our current
bearings and to set our course.
3
Document 62.
4
Telegram 3478 from Santiago, September 3. (National Archives, RG 59, Central
Files 197073, POL 14 CHILE)
378-376/428-S/80023
September 5November 4, 1970 183
65. Backchannel Message From the Ambassador to Chile (Korry)
to the National Security Council
1
Santiago, September 7, 1970.
Part I.
1. In the past 48 hours, the following pertinent events have
occurred:
A. Alessandri campaign headquarters has issued statement that
emphasizes the constitutional process has not yet ended and that im-
plies questioning of voting results.
B. Alessandri has agreed privately to avoid any gesture of cession
or of recognition of Allende as President Elect.
C. Alessandri supporters mounted a noisy but modest-sized rally
in Santiago last night to support the foregoing, to spread the rumor that
the vote-counting might have been fraudulent or erroneous and to start
creating a spirit of combativeness.
D. Frei first designated ex-Interior Minister and PDC Deputy Ber-
nardo Leighton (who headed congressional investigation of Cam-
paign of Terror) to be his representative in dealings with Alessandri
forces to study constitutional processes by which Allende triumph
could be overturned. Subsequently because of Nacional Party mistrust
of Leighton, Senator Duran, an Alessandri dissident radical, sup-
planted Leighton. He is dealing with ex Interior Minister Perez-
Zujovich (PDC) and Senator Bulnes (Nacional) who possesses one of
most distinguished names in Chile.
E. Sunday separately I called US correspondents of NY Times,
Washington Post, Washington Star, Los Angeles Times and Baltimore Sun
(after having been called Saturday by CBS from Washington) to give
my reaction to Szulc story page 3 NYT on US Navy.
2
Aside from giving
detailed rejection of story I emphasized to each for the record that I had
two weeks ago told GOC I was prepared to request Dept to issue
worldwide circular halting all military and civilian official travel to
Chile for indefinite period and if desired to advise US tourists as well.
GOC had rejected both stating it wished normal travel. NYT man No-
vitski confessed to others later his total surprise that he had this inter-
view with most relaxed US Amb in between golf shots yesterday morn
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret. A notation on the first page reads, Recd Sept 7 6:30 p.m.
2
See footnote 2, Document 61. Korrys response to the Szulc story in the New York
Times was printed on September 7. (Envoy Says He Controls U.S. Navy Visits to Chile,
New York Times, September 7, 1970, p. 8)
378-376/428-S/80023
184 Foreign Relations, 19691976, Volume XXI
and that I was accompanied by DCM. We have successfully so far per-
suaded very doubting US press that we mean it is a Chilean problem
and that while we do not welcome Allende prospects, we intend to deal
with it realistically. Also we continue to downplay to press negative
consequences in hemisphere for US of Allende.
F. Christian Democrats are displaying more than their usual state
of decomposition. Gabriel Valdes telephoned Allende his congrats be-
fore midnight Friday. Tomic promptly went Saturday to embrace Al-
lende at his home, to recognize the victory as final, to address him in
the familiar tu, and he was followed quickly by some of the key Tomi-
cistas. All TV channels including GOCs last night carried entire Al-
lende press conference where he revealed himself as a pathetic tinplate
of Castro and where his particularly unattractive qualities dominated.
Significant that quite a few domestic and foreign newsmen addressed
him as Senor Presidente and thus help the Marxists in determined ef-
fort to create the popular impression of finality.
G. A nominally PDC friend of Frei found the President in an ex-
tremely dejected and disorganized frame of mind. As I tried to convey
to Valenzuela, we have no illusions about Freis cojones; the man
positively delights in playing Hamlet in moments like these. He la-
mented that he had been abandoned by his party, that no one aside
from our informant had even come to see him from the PDCs congres-
sional representation or party leadership, that Tomic and his friends
had the ball and were trying to carry out a deal with Allende, that he
was worried about his place in history and that he wished the military
would have a coup. While he stressed that military had to do some-
thing and that the something had to be sooner rather than later, he
felt he could not approach military. Moreover in discussing constitu-
tional alternatives, Frei avoided focus on himself but instead specu-
lated about Leighton or Perez-Zujovich as potential runoff candidates.
H. Our much esteemed ARMA reports from weekend social con-
tacts that change of mood has occurred with officers. They are much
more perturbed, much more combative in spirit than in pre-election eu-
phoria. This mood is matched in part by a comfortable upper and
middle class that is horrified not so much by Cuba but by a Bolivian
model where the people come to power to destroy the values of this
country. Typical example is that most golf caddies stayed home this
weekend in expectation they would soon be given homes of wealthy
and food. At first, universal Alessandrista reaction was panic; of fear
for lives and property, of capital flight and visa requests. Now some are
beginning to rationalize the situation, encouraged by the Tomic ex-
ample, while others are just getting down to the serious business of
thinking through the problem and how to fight back.
378-376/428-S/80023
September 5November 4, 1970 185
I. Gen Valenzuela met Saturday with CINC Schneider, Carabinero
CINC Huerta, Air Force CINC Guerraty, Chief General Staff Prats and
on Sunday with retired Gen Viaux. Valenzuela asked and received
their support of plan whereby constitutional processes would be fol-
lowed so that new elections would be held between Frei rpt Frei and
Allende. Valenzuelas scenario is that the PDC and Nacionales would
do a deal to elect Alessandri who would accept the nomination, form a
military cabinet and immediately resign Nov 4th. New elections would
be held in 60 days that Frei would win. The military and Carabineros
would move troops and tanks into Santiago by Oct 22.
J. Valenzuela requested our excellent ARMA Sunday to inform me
of the foregoing and to try to ascertain my reaction before he met with
the top Army generals today. He also asked that I use my influence
with Frei to gain acceptance of his plan.
K. I had ARMA inform Valenzuela promptly last night that I was
very satisfied to know that the Armed Forces of Chile shared my rpt my
conviction of what would be consequences for the Armed Forces and
for Chile of an Allende Presidency. Valenzuela was also told that I
found it encouraging that Chilean Armed Forces had begun the
process of planning the location in Santiago before the 24th of October
of units effectively prepared to control the situation and to maintain
law, order and respect for the traditional Chilean democratic liberties.
He was told that I had known about the constitutional possibilities but
that I wished to point out that in the remaining 48 days before the con-
gressional runoff Frei would be subject to many pressures, from those
sharing Valenzuelas views and from those opposed. However I was
convinced that Chileans, particularly those who represented so profes-
sional and so respected an armed force could find a correct and demo-
cratic solution for a problem that signified so much in terms of Chiles
future and that of the hemisphere.
L. I have also had Political Counsellor return to his contact (para 1
G) who was supposed to see Frei again this morning to deliver my
prompt comments on his information. First he was told Freis attitude
comes as no surprise; he is no Lleras Restrepo; he will wring his hands
and feel sorry for himself but he has not the guts to act to save his
country, his name in history or even himself. Secondly, Chile can save
itself with relative ease if men such as Perez Zujovich, our informant
and others keep their heads and cold-bloodedly plan what is essential.
Thirdly, the US is not going to intervene in any way to save their
chestnuts; it is either a Chilean action or nothing. Fourthly they should
try their best to infuse some spine into Frei and to create a climate
which can help bestir Frei to action. Fifthly instead of worrying about
stories (such as informant had related to Pol Counsellor) that Valdes
had permitted 2000 guerrillas from other parts of country to infiltrate
378-376/428-S/80023
186 Foreign Relations, 19691976, Volume XXI
Chile past few weeks, they should remember that there are only a few
hundred key opponents that form the opposition organization and that
all could, if necessary be sent to Cuba with Castros famous words (re
Americans) of good-bye y good luck. Finally I noted my personal
confidence in Perez Zujovich, whom I had not seen for some weeks be-
cause I did not wish to intervene in Chilean political situation, and that
my advice to informant would be to consult him rather than Frei. Infor-
mant left his home immediately to see Perez Zujovich whom he had
first telephoned.
Part II.
1. I have acted promptly invoking only my name and always care-
fully stressing that the US will not intervene in any way. Also I have de-
liberately created a climate of Embassy inactivity and of official relaxa-
tion. I have done so because of my profound conviction that if
something were not done promptly there would be no rpt no hope
whatsoever. The Chilean propensity for transaction and for shifting re-
sponsibility to othersas evidenced by Frei looking for the military to
come to him and the military looking to me to go to Freiis so great
that the Communists would have had Allende universally regarded as
the unalterable victor and the Oct 24th Congressional meeting would
have become a formality. Indeed my British colleague is already fig-
uring out how to snuggle up to Allende via his new and charming
friend Pablo Neruda, the French are of the same frame of mind and
many of our allies will not be left behind. The panic that seized the Al-
essandri camp and that has made my life intolerable the past 48 hours
because of Chileans assailing me for visas had to be stemmed and con-
verted into some degree of hope.
2. I want to be very clear. I have very little confidence that any of
this Phase Two action will be successful. The PDC is ready to ration-
alize; Allende and the Communists are already diligently mending
fences with the Christian Democrats of whom there are many only too
anxious to enter that kind of transaction. The military unless given
some sound advice is capable of depending only on the President and
that is a very weak reed indeed. What I am striving to do is keep some
flexibility in the situation and to sting Freiand if not him then the
next bestinto behaving like men should in moments of crisis. Also I
am unalterably determined that we do everything reasonably possible
to keep alive the possibility of reversing the great setback to US
interests.
3. There are some actions that I would urgently wish handled in
Washington:
A. That the Department promptly act to persuade LatAm and
Western European and Asian govts not to take any action that would
imply that Allende is already President of Chile.
378-376/428-S/80023
September 5November 4, 1970 187
B. That the USG in all its comments seek to parallel ours and so
buttress the view of sorrow but non-intervention while we await the re-
sults of the constitutional process.
C. That despite my pessimism you urgently provide me with the
best possible advice drawing from past experience of the kinds of polit-
ical action (rumors, economic measures by Chileans that could create
panic or could upset the Communist plans for smooth victory Oct 24th
or any other suggestion) that would be of value. It occurs to me that at
the proper moment, if the military were to prepare themselves and if
some political support could be mustered, that a close-down of busi-
nesses here could even panic the workers. We already have a mild bank
run and a flight of capital, plus halting of some private construction
activities.
D. It is self-evident that we need gestures indicating continuing
support for advancement of Chilean Armys professional role. Valen-
zuela is extremely grateful for the prompt and to him surprising effi-
ciency with which Armed Forces requests for purchases of mil equip-
ment were handled this year. I would recommend therefore that
immediate steps be taken to restore five selected FY 71 MAP-funded
CONUS training slots eliminated in latest overall LatAm reductions.
They are courses in command, and general staff and advanced infantry,
artillery, armor and engineering schools for individual field grade of-
ficers. They are highly prized in Chilean Army and their restoration to
the MAP program would have favorable impact on officer corps as a
whole. Total cost, according our understanding, would be only U.S.
dollars 23,180. I am confident that Secretary of Defense can devise
prompt transfers of funds to comply with this recommendation and
that I be authorized in next few days to inform Chilean Army of
restoration.
E. There is critical personal factor involved in entire problem. Our
only tested and reliable channel of communications to Chilean Army is
ARMA Lt. Col. Paul Wimert. He has the complete confidence and trust
of the key officers; they have known him and feel comfortable with
him. Wimert is scheduled for rotation in November but I find it un-
thinkable that we would deprive ourselves of this vital asset at a time
when so much is riding on our relations with the Chilean Army. It
would take many months for a new officer, however well qualified, to
begin to develop the kinds of relationships Wimert enjoys. I request
therefore that he be extended here for a period of nine months.
F. The [less than 1 line not declassified] with [name not declassified]
cited in Part One of this message raised the question of funds to sup-
port political action in his first conversation with Pol Counsellor who
quite rightly told him to forget it. However it is obvious that contin-
gency funds will be needed by US although I am already aware that
378-376/428-S/80023
188 Foreign Relations, 19691976, Volume XXI
some US companies are sympathetically considering requests from Al-
essandris camp for monies destined for same purpose. Obviously
many of our past mechanisms will not be employable at this time but it
would be extremely helpful to know that standby funds are available. I
would request [dollar amount not declassified] be set aside now pending
further study of most effective use and later submission of plans for
their use.
66. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 7, 1970.
SUBJECT
40 Committee Meeting, September 8Chile
A. The purpose of tomorrows meeting on Chile is to:
1. Review the factual situation and its implications. (CIA is pre-
pared to brief, and a wrap-up is attached at Tab 2.
2
Ambassador Korry
has just sent in a long cable summarizing the current situation. This is
also worth reading and is at Tab 3).
3
2. Determine whether Phase 2 operations such as that which had
been suggested earlier to influence the congressional run-off election
are realistic now.
3. Determine whether there is any prospect for Chilean military ac-
tion to keep Allende from taking power.
4. Determine what action plan we should now follow and what
further analyses we need to undertake.
B. Korrys latest views and information (Tab 3) pose some specific
questions within the above major categories.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive.
2
Attached but not printed is the 9-page CIA Intelligence Memorandum 1461/70,
Situation Following the Chilean Presidential Election, dated September 7. The full text
of the memorandum is published as Document 18 in Foreign Relations, 19691976, vol.
E16, Documents on Chile, 19691973.
3
Document 65.
378-376/428-S/80023
September 5November 4, 1970 189
1. He indicates Alessandri supporters may be prepared to contest
the run-off and not concede defeat. He indicates at one point (1D) that
Frei may also move to contest the run-off, but later bewails Freis
hand-wringing.
4
2. Korry indicates that the high military officers are concerned and
he relates a specific proposal being kicked around by the military com-
manders to foster an AlessandriChristian Democrat deal to elect Ales-
sandri and then have Alessandri resign and in 60 days have Frei
elected.
3. One military officer tried this out on Korry, and while he did not
respond specifically he did in effect give some encouragement to the
military to think about their responsibilities to find a correct and
democratic solution. (See paragraph K tab 3)
4. Korry in effect is saying he is trying to keep everything flexible
and options open and to encourage Chileans who are disposed to con-
test Allendes victory to stay firm. However, he holds no particular
hope that these elements will be able successfully to contest the run-off.
He does seem to be leaning more and more to encouragement and
moral support of the military.
5. He asks for a few specific things:
a. that the Department lobby in other countries to keep them from
taking action implying that Allende is already President. (I do not see
how we can do that without tipping our hand that we, the US, would
contest the election.)
b. we provide to Korry suggestions of action that could keep the
Communists from consolidating the psychological sense of victory.
c. we show support of the military by restoring some training slots
and extending our Army Attache for another nine months since he
enjoys their confidence.
d. he requests a [dollar amount not declassified] contingency fund
set aside in case it is needed to support Phase 2 kind of action.
6. Korrys cable at Tab 3 is a little rambling and inconsistent. He is
still trying to think of something but the information does not in my
view resolve the questions very satisfactorily. In particular, he may be
operating personally with a little more commitment and encourage-
ment to the military and/or other elements than he describes in the
cable.
C. The conclusions we are likely to arrive at are:
1. It continues to appear very doubtful that Allende can be denied the con-
gressional election victory within the normal electoral framework. The Chris-
4
Kissinger wrote, Prevent recognition by Europeans, in the left margin.
378-376/428-S/80023
190 Foreign Relations, 19691976, Volume XXI
tian Democrats hold the key and Korry indicates that they are decom-
posing and that Frei is far from firm. On the other hand, the indication
that Frei is examining the constitutional processes by which Allendes
victory can be over turned is a contradictory sign that Korry does not
explain. In balance, it seems to me that the chances of a coordinated
Christian DemocratAlessandri effort to over turn Allendes election
are very slim, and are hardly promotable by us alone.
2. It is equally dubious that the Chilean military can mount any viable ac-
tion against Allende. The plan given to Korry is premised on Christian
Democratic cooperation but it is not clear that this is realistic. There is
more indication from Korrys cable, however, of military dissatisfac-
tion than had been indicated earlier. There is still serious doubt, how-
ever, that we could stimulate any such action that would not result in
violence, civil war, and perhaps destruction of the military as an
institution.
3. We need to know a lot more than we do about how Frei, Edwards, Ales-
sandri and other key anti-Allende elements see the situation and what they
propose to do. Hence it is important to get the Embassy [less than 1 line
not declassified] to contact them for their views. (There may be some re-
sistance from State on the grounds that we should not push them into
courses of action they are not prepared to take themselves. Never-
theless, I think that contact to determine their views is indispensable for
us to make good judgments. I also think that we can do that without
triggering something that wont fly.)
4. We shall have to come to some definitive conclusions soon as to the fea-
sibility of supporting either political action to affect the congressional election
or a military effort. My own view is that neither is very realistic or worth
the risk, but we will probably have to ask the Agency and State to come
up with a reasonable assessment very soon.
5. We should now also begin thinking in terms of how to cope with an Al-
lende government and how to limit and contain the adverse impact of such a
governments policy. This means early consideration of NSSM97.
5
D. I believe that we should end up with the following decisions:
1. Authorize the Embassy to probe the views of key elements in
Chile, particularly Frei and Edwards and report these as soon as
possible;
2. Task CIA/State to come up with final recommendations on
what political action to take, if any, regarding the run-off and/or en-
couragement of military, and to do this no later than September 15.
3. Review these recommendations as soon as possible thereafter;
5
See Documents 46 and 52.
378-376/428-S/80023
September 5November 4, 1970 191
4. Hold a Special Review Group consideration of NSSM97 as soon
as we have reached final conclusions on point 3.
E. Attached are:
1. Talking Points.
2. CIA intelligence summary (which you may wish to skim fairly
carefully.)
3. Ambassador Korrys cable of September 7.
4. Background on previous 40 Committee meetings on this
subject.
6
5. I have not added the contingency paper CIA prepared prior to
the election. Because these ideas were designed essentially for an Ales-
sandri popular vote victory, they are not very meaningful now.
7
Attachment
8
Washington, undated.
HAK TALKING POINTSCHILE
1. All of you should have received a CIA wrap-up of the situation
in Chile as it looks after Fridays election. I would like to ask CIA to
summarize the situation and to brief us on Ambassador Korrys latest
views.
2. I think the first point to focus on is whether there is any chance
for political persuasion or action to influence the Chilean congress to
elect runner-up Alessandri on October 24. (We expect the consensus to
be that there is little realistic chance; since the Christian Democrats are
indispensable to any vote to elect Alessandri, Freis all out effort is in-
dispensable. Even with it, it is not certain anything would be effective;
without it it would be impossible.)
3. What are the prospects that the Chilean military will take some
action to keep Allende out of the presidency? (We expect the consensus
to be that such prospects are poor. Korry indicates they are thinking
about something but it is a tenuous plan, also dependent on the Chris-
tian Democrats whom Korry thinks are falling apart. No one can dem-
onstrate any reasonable prospect which we can support and since an
attempt which fails may enable Allende to destroy the military institu-
6
Background information is not attached was and not found, but see Document 49.
7
See Document 16, Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973.
8
Secret; Sensitive.
378-376/428-S/80023
192 Foreign Relations, 19691976, Volume XXI
tion in one move and thus eliminate the greatest restraint on him; we
ought to be leery about whether we should encourage this kind of ac-
tionat least now).
4. The discussion shows that judgments about what is likely to
happen and what we ought to do cannot be made very confidently
without more information as to what the views and intentions of
people like Frei, Alessandri, Augustin Edwards are. Ambassador
Korry has indicated that he has begun to make contact to find out. I
take it there is no objection in this regard. (State may have some
qualms, but I think our people must be able to talk frankly with the
Chileans; there is no need to talk in terms of organizing an operation,
just to gain political intelligence.)
5. What about Korrys specific requests contained in his latest
cable? (See B5 in your memo. I do not believe you will want to discuss
these exhaustively, and I suggest that they be rolled in and answered in
the definitive recommendations you request in the next point.)
6. Korrys latest cable states he is trying to keep all options open.
But his assessment is not hopeful. He gives us little guide for any judg-
ment as to whether any political action programby us aimed at keeping
Allende out of power has any realistic chance. I must confess that we
seem to be where we were several weeks ago. The time has come to de-
cide whether there is anything we can do or whether we should move
to planning for an Allende government so as to limit the damage.
7. I propose that after a prompt reading of the various key ele-
ments we talked about earlier, CIA and State present their definitive
recommendations to this Committee as to whether there is anything
further to pursue in this sense. If not we should shift to considering
NSSM97 and our long range strategy.
378-376/428-S/80023
September 5November 4, 1970 193
67. Central Intelligence Agency Intelligence Information Cable
1
Washington, September 8, 1970, 2144Z.
COUNTRY
Chile
DOI
6 September 1970
SUBJECT
Inconclusive Meeting of High Ranking Chilean Military Officers to Discuss the
Possibility of a Military Coup Against the Government.
ACQ
Chile, Santiago (7 September 70) Field no. [less than 1 line not declassified]
SOURCE
[5 lines not declassified]
TDCS 314/0947370. 1. (Source Comment: The following informa-
tion was made available to Senator Julio Duran, a strong supporter of
defeated Presidential candidate Jorge Alessandri, by General Carlos
Guerraty, Air Force Commander-in-Chief (CINC). General Guerraty
commented that he was making this information available in order to
keep the Alessandri forces apprised of developments within the
military.)
2. During the afternoon or early evening of 6 September 1970 high
ranking Chilean military officers, including General Rene Schneider,
Army CINC; Admiral Fernando Porta, Navy CINC; General Carlos
Prats, Chief of the General Staff of National Defense; and General Vi-
cente Huerta, Director General of the Corps of Carabineros; met at
Guerratys home to discuss the possibility of a military coup against the
Chilean Government in order to prevent the inauguration of Socialist
Senator Salvador Allende as President of Chile. The discussion cen-
tered around the possibility of flying President Eduardo Frei to another
country, naming a military junta, and then convoking new Presidential
elections as soon as possible.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Priority; No Foreign Dissem. Trans-
mitted to the White House, Department of State, Defense Intelligence Agency, Army,
Navy, Air Force, Joint Chiefs of Staff, National Intelligence Council, National Security
Agency, and Office of Current Intelligence. Attached to a September 9 memorandum
from Vaky to Kissinger, which Kissinger saw and initialed. The memorandum summa-
rized the Intelligence Information Cable, noting the meeting was inconclusive,
Schneider was apparently opposed to a coup, and Chief of the General Staff, General
Prats, was strangely quiet. (Ibid.)
378-376/428-S/80023
194 Foreign Relations, 19691976, Volume XXI
3. Although most of those present at the meeting were of the
opinion that something should be done to prevent Allendes ascen-
dancy to the Presidency, the meeting ended on an inconclusive note.
General Schneider was opposed to a military coup. General Prats did
not openly support those who favored a coup and, indeed, kept
strangely quiet throughout the meeting.
4. Field dissem: State, Army, Navy, Air, CINCSO. [less than 1 line
not declassified]
68. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 8, 1970, 2344Z.
3537. Subj: No Hopes for Chile (Part I of II Parts). Ref: Santiago
3499.
2
1. My electoral night pessimism is strengthened as the chances im-
prove hourly of Allende being confirmed as President. Neither the po-
litical nor the military forces opposed to Allendes accession have more
than the slimmest reeds of hope. Hence, however reluctantly, the US
must begin to plan now for the reality of an Allende regime.
2. In what seems light years ago, I wrote last month that civility is
the dominant characteristic of Chilean life. Civility is what controls ag-
gressiveness. And civility is what makes almost certain the triumph of
the very uncivil Allende. Neither the President nor the Armed Forces
have the stomach for the violence they fear would be the consequence
of intervention. Each wants the other to act to assume the historic re-
sponsibility for the bloodshed that would, in their view, flow and that
might reach the proportions of a civil war.
3. As in the elections, the Popular Unity forces are fully prepared
for all contingencies including that of victory. As in the campaign, their
opponents are as bumbling, disorganized, naive and impotent as ever.
The military talks and talks; the President and his cronies talk and talk;
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Immediate; Limdis. Repeated to
USCINCSO. This telegram, sent in two parts as two cables, is also attached to the Sep-
tember 9 memorandum from Vaky to Kissinger, which summarizes the cable and recom-
mends that it was worth skimming. See footnote 1, Document 67.
2
Document 62.
378-376/428-S/80023
September 5November 4, 1970 195
but the Communists, who have prepared themselves so diligently for
this opportunity, act and they act with dexterity, determination and the
dread they inspire. The New York Times editorial yesterday
3
called
Christian Democrat candidate Radomiro Tomic the architect of Al-
lendes triumph at the polls; they could have added he is also the de-
signer of his ascendancy to the Presidency.
4. Tomic promptly recognized the Allende victory last Saturday.
4
His vocabulary for the past year had legitimized the Marxist goals; on
Saturday he gave flesh to his words by embracing Allende in full view
of TV cameras. Since his only contribution to Christian Democracy in
the campaign was to maintain the unity of the party and since his men
run the party, he provided the initial impetus that will almost inevi-
tably bear Allende to the highest office. Tomic is de facto working to
eliminate any contest in congressional runoff scheduled for Oct 24.
The facts are that the PDC intends to hold a party junta in October
to determine tactics and policies, including the stance on the congres-
sional runoff. In the interim the PDC is seeking a negotiating position
by stating that the electoral process has not been ended. As a negotia-
ting team, they have named three Tomic stalwarts led by Deputy Luis
Maira. The four conditions they have presented to the Popular Unity
forces are, in my judgment, completely acceptable to the Marxists and
such acceptance will provide the escape hatch that the PDC seeks and
that the Communists feel will seal Chiles fate. The conditions include
autonomy for the universities (a favorite Communist slogan), con-
tinued professionalism in the Armed Forces (as Allende himself has
stressed), freedom of the press interpreted as the freedom of each
newsman to report objectively but excluding control by the great eco-
nomic interests (an Allende formulation) and finally, a guarantee of
democratic election (as the Popular Unity insists there will be).
5. Equally significant is that Tomic was asserting his control of the
PDC, was isolating Frei from the party the President founded and
swept to power. Pacing the floor of his office and bemoaning his fate,
Frei is discovering he has only a few Ministers on whom he could
count, a few Senators and Deputies who are willing to consider alterna-
tives, and some party wall-flowers of the past. They have mulled the
political alternatives of over-turning Allende and the military options.
Both appear to be built on sand.
6. The political options hinge on a majority of Congress voting for
Alessandri; he, in turn, would name a military cabinet, then resign after
3
September 8. (Juan de Onis, Chiles Winning Coalition: Communist-Backed
Group of Radicals and Catholic Leftists Provided Plurality, New York Times, September
8, 1970, p. 6)
4
September 5.
378-376/428-S/80023
196 Foreign Relations, 19691976, Volume XXI
being inaugurated. The military would call new elections for a popular
runoff against Allende. In his discussions with Chilean politicians, Frei
has avoided mentioning himself as the alternative, proposing such
non-starters as either of his ex Interior Ministers, Bernardo Leighton or
Edmundo Perez Zujovic. But everyone knows it must be Frei, yet he
will not burn his bridges and admit the obvious because he knows he
has no power over his party and because he wants to maintain max-
imum flexibility as the unsullied President of all Chileans. His caution
permitted Tomic, an all-time loser, to win Freis party. A man without
pants does not feel the shirt being removed from his back.
7. The Alessandri forces have played along with this scheme that
some weeks ago I described as far-fetched and that increasingly looks
like some Rube Goldberg contraption. Alessandri has kept his si-
lence; his headquarters said they would not recognize Allende as the
President-elect; they have organized a few unimpressive demonstra-
tions and they have spread the rumor of electoral fraud and of im-
pending massive challenges of individual votes before the National
Electoral Board rechecking the ballots. The Alessandri Independents,
the National Party and the Freistas have formed a working group to
coordinate their planning but they simply cannot hack the knot of
impotence in the Congress.
8. Frei, no less convinced today than before the elections, that Al-
lende signifies an irreversible road to a Communist state in Chile, is
awaiting the militarys move. A good many of the higher officers of the
three services talk tough but objective analysis compels the conclusion
that they will not act effectively. They want a moral justification. A re-
quest from Frei might be sufficient; a breakdown of law and order
would be more persuasive.
9. They hold meetings and the whole town knows about them in-
cluding the Allende camp. The latter have contacted Generals and Ad-
mirals who are promised key jobs in the new era; they have assured the
mass of younger officers that neither they nor their privileges will be
touched; they have solidified their support among the Army non-coms,
the men who really control the troops.
10. The military never had a contingency plan. They never had any
prior agreement among themselves; they never lost their mistrust of
each others intentions. To give one example, Gen Valenzuela, the Jefe
de Plaza of Santiago, is consulting civilians on how to deal with the
commander of the Second Division, whom he has just discovered is
quite close to the Allende forces (and which we and most interested
parties have known for a long time). The Navy CINC talks tough in the
meetings with the confreres but speaks softly and reassuringly to his
own subordinates. They talk. They wait. They wait for someone to
create a propitious climate.
378-376/428-S/80023
September 5November 4, 1970 197
11. There had been some expectations among the Alessandri forces
that economic conditions might provide the essential provocation.
When the banks opened Monday there was a mild run and American
newsmen received 47 and even 60 escudos to the dollar. But today
things quieted down as Freis Central Bank President Carlos Massad
moved swiftly and effectively to provide the necessary liquidity and as
the full panoply of both PDC and Popular Unity forcespolitical as
well as informationalorchestrated a soothing message to the Chilean
public. Finance Minister Zaldivar who is totally loyal to Frei put the
mint on three shifts so the bank notes will be in ample supply in a few
days time thus removing what might have been a very serious problem
by next Saturday. Allende called on Frei yesterday to discuss the eco-
nomic threat and to ask for recognition as President-elect. Frei received
him icily and refused to preempt the constitutional process. However
he did agree to have Allendes nominee, Pedro Vuskovic, ultra-left Di-
rector of Economic Institute of University of Chile, serve as liaison to
Zaldivar in the anti-panic activities. Frei refused to cede to Allendes
demand that similar liaison be established in the political sphere be-
tween the GOC and his people. The point is that while Frei yearns for
Allendes defeat, his govt acts to prevent economic conditions that
might set in motion the politico-military forces to defeat Allende. (End
Part I)
Korry
69. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 9, 1970, 0049Z.
3538. Subj: No Hopes for Chile (Part II of II Parts). Ref: Santiago
3499, 3537.
2
12. At lunch today with the Ambassadors of UK, France, Germany,
Italy, Belgium and Holland, my colleagues felt there was practically no
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Immediate; Limdis. Repeated to
USCINCSO. This telegram, sent in two parts as two cables, is also attached to the Sep-
tember 9 memorandum from Vaky to Kissinger, which summarizes the cable and recom-
mends that it was worth skimming. See footnote 1, Document 67.
2
Documents 62 and 68.
378-376/428-S/80023
198 Foreign Relations, 19691976, Volume XXI
possibility of Allende being stopped from assuming the Presidency.
The Italian, an intimate of Foreign Minister Gabriel Valdes, went fur-
ther and propounded the Tomic line. He said there was considerable
doubt Chile would become a Communist state under Allende and
therefore it was essential all Chileans work diligently to maintain the
prosperity of the country and permit the PDC to save democracy. The
British went considerably farther while the Belgian and the German
backed my view and the other two remained noncommittal. Because it
bears so much on future US policy and the recommendations we shall
be sending tomorrow, I believe it of interest to recount the funda-
mentals of the discussion.
13. Essentially, British Amb Hilyard who arrived one month ago
from his UN post argues a long view of history. He said at one point
that Castro would collapse and then added within twelve years. At
another point he said that all of Latin America probably needed to go
through Communism for twenty years to eliminate the glaring injus-
tices and then things would start to turn right. As for Chile, he agreed
with my view that the US and American companies would be the initial
Allende target along with the big Chilean businessmen, that Allende
would seek to divide the US from Europe and Japan and that after sev-
eral years of that game he would get much rougher. We both agreed
that the USSRhad no stomach for another Cuban drain on its resources.
We both agreed that Allende would move prudently within Chile and
seek to keep small enterprises going and to utilize professionals and
managers who were on the margin of politics.
14. His conclusion was that commercially it would be very benefi-
cial to use the initial period of smiles to bargain better deals. He ad-
mitted that these negotiations might imply fresh credits but said they
would be short-term only and tied. He also said that anything the West
could do to keep the country afloat would be beneficial over the long
haul.
15. My conclusion was that if the Allende regime wishes to move
slowly to consolidate its political power and to devour at its leisure the
PDC and the institutions of Chile, why was it in our interest to follow
its timing and program. The Western world and the US had a consider-
able number of higher-priority problems than this one. Our relations
with the Soviet Union were central to a reading of this situation. Would
it not be better for the Allende govt to accelerate its harsher measures
and possibly provoke a popular reaction in the first year of the new
era? Would it not be better to push the USSR faster into costly support
(and dispersal of effort) of a regime that would confront incredibly dif-
ficult economic problems including a high rate of inflation, dislocations
in production because of nationalizations, decrease in farm output be-
cause of expropriations and so on? Would it not be better for the Soviet
378-376/428-S/80023
September 5November 4, 1970 199
hand to show immediately and thus give an early alert to the rest of
Latin America of the reality of this place? Would it not be a better way
of increasing the odds that Communism could not take hold if it had
shorter time frames in which to act? I predicated this view on my state-
ment that the US would maintain correct rels, that we would (as all my
colleagues would) await the Allende govts moves in most matters
against us rather than provoking any confrontations and that certain
US presences would remain until he moved.
16. The German and Belgian supported me fully and I believe I
made the Frenchman reflect somberly. Even the Italian may reconsider.
You have a taste now of things to come. (End Part II)
Korry
70. Memorandum for the Record
1
Washington, September 8, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 8 September 1970
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. Johnson, Admiral Moorer,
and Mr. Helms
Mr. Charles A. Meyer, Mr. Viron P. Vaky, Mr. William McAfee, Mr. Thomas
Karamessines, and Mr. William Broe were also present.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
1970. Secret; Eyes Only. Drafted on September 9. Copies were sent to Mitchell, Packard,
Johnson, Moorer, and Helms. Attached to the Department of States copy of these
minutes is a note from Jim Gardner (INR/DDC) to Meyer and Crimmins. Gardner noted,
Bill McAfee, who was there, feels that minutes much understate Helms pessimism
about influencing Congressional vote, and that they overstate passivity of State repre-
sentatives in face of prospects of an Allende government. We can ask that minutes, in-
sofar as they relate to State position, be corrected if you wish. Crimmins wrote on the
note, This is accurate, but does not reflect the fine line as to whose civil war. Alex did
not make clear the distinction between a 100% Chilean military action and one inspired
by or based upon U.S. support. I think the minutes could reflect this difference. (Na-
tional Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Documents Requested by
the Department of Justice, 19701977)
378-376/428-S/80023
200 Foreign Relations, 19691976, Volume XXI
Chile
a. The Chairman opened the meeting with a reference to Ambas-
sador Korrys excellent cable of 7 September 1970
2
and asked for an
analysis of where prospects now stand for taking any kind of action
which might successfully preclude Allende assuming the presidency of
Chile following his garnering of a plurality of the popular vote in the
elections on 4 September.
b. Mr. Broe summarized the situation and highlighted some of the
points in Ambassador Korrys cable. He noted that Korry is attempting
to maintain flexibility and that there is some, but not much, fluidity in
the situation. He pointed out that Frei is an essential cog to success in
any action, congressional or military, to frustrate an Allende take-over
and that Ambassador Korry is very pessimistic about the prospects of
Frei doing much more than deploring Allendes electoral victory. He
concluded that it is still too early to decide on a given course of action
and suggested that the Embassy and CIA field elements be requested
during the next week to probe all possible aspects of feasible actions
and forward recommendations as to what might be done.
c. In the lively discussion which followed, there was general agree-
ment that more time to assess the situation was essential. It was also
agreed that there is now little likelihood of success in the previously
proposed operation to influence the 24 October congressional run-off
election against Allende.
d. Mr. Helms, noting that congressional action against Allende
was not likely to succeed, offered his personal observation that once Al-
lende is in office it is predictable that the Chilean opposition to him will
disintegrate and collapse rapidly. He expressed the view that Allende
will quickly neutralize the military and police after which there will be
no effective rallying point for opposition against him. Without advo-
cating it as a course of action, he observed that a military golpe against
Allende would have little chance of success unless undertaken soon.
He stated that even then there is no positive assurance of success be-
cause of the apolitical history of the military in Chile and the presence
of Allende supporters in various military elements.
e. Mr. Packard was also strongly of the view that any effective mili-
tary action to prevent Allende from assuming the presidency would
have to occur in the very near future. He expressed the hope that the
Chilean military leaders would undertake such action soon on their
own initiative.
f. Messrs. Johnson and Meyer pointed out that if Allendes election
is frustrated by a military take-over, there is a strong likelihood that his
2
Document 65.
378-376/428-S/80023
September 5November 4, 1970 201
supporters would take to the streets and plunge the country into full-
scale civil war. They felt that Allende was possibly the lesser of two
evils. They suggested that Frei should be strongly counseled to start
immediately building an effective political opposition for the future be-
fore important individuals who would constitute that opposition might
decide to leave the country.
g. The Chairman and Mr. Mitchell expressed considerable skepti-
cismthat once Allende is in the presidency there will be anyone capable
of organizing any real counterforce against him.
h. In accord with the agreement of those present, the Chairman di-
rected that the Embassy be immediately requested for a cold-blooded
assessment of:
(1) the pros and cons and problems and prospects involved should
a Chilean military coup be organized now with U.S. assistance, and
(2) the pros and cons and problems and prospects involved in or-
ganizing an effective future Chilean opposition to Allende.
i. The Chairman stated that these assessments and recommenda-
tions should be available in time for 40 Committee consideration in a
meeting to be convened on 14 September.
Frank M. Chapin
71. Backchannel Message to the Ambassador to Chile (Korry)
and the Chief of Station
1
Washington, September 9, 1970.
1. The 40 Committee met 8 September and after reviewing various
avenues of approach to prevent an Allende administration, including
the possible manipulation of Chilean Congress and military action, de-
cided to give serious consideration only to the latter possibility.
2
2. The Chairman requested by close of business 12 September a
cold-blooded assessment of the realism and feasibility of any action
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret. Attached to a note from
Broe to Gardner that states, This message was seen by Pete Vaky and John Crimmins
and includes their views and thoughts.
2
See Document 70.
378-376/428-S/80023
202 Foreign Relations, 19691976, Volume XXI
by military either along lines of your Labor Day telegram
3
or a coup
detat. This assessment to include:
A. How such action would be organized by the Chileans, in-
cluding such detail as who could be expected to do what and how and
by whom they could be approached;
B. Who would participate (include your assessment of their capa-
bility) and can the military leaders reportedly in touch with Valenzuela
carry out a meaningful action?; are all the leaders likely to act in a uni-
fied way or is there a chance of a division in the military?
C. To what extent the USG would have to be involved either co-
vertly or overtly;
D. Will the troops, particularly the non coms follow orders in a
military move?;
E. What is the reaction in the country likely to be? What reaction by
the Allende forces? Would a military move precipitate violence, and if
so, how serious or sustained? What are the risks that a military move
may end up in the destruction of the military as an institution?
F. What are the chances of success or failure of each step in military
action? What are possible consequences?
3. In addition to the foregoing analysis of the military routes, we
also want to assess what we might do assuming Allende takes office. Is
there a strategy or purpose to be served by a covert action program in
these circumstances? We need same scrupulous identification and ex-
amination of any meaningful political opposition which we could rea-
sonably expect reach and support beginning now. Again we will need
operational details including frank appraisal whether or not political
figures involved more apt cave in under Allende administration
pressures.
4. You are hereby authorized make appropriate contacts to obtain
the political intelligence you feel you need to answer foregoing. We
want to emphasize that we are trying to make as informed a judgment
as possible on the realism of options that may be open to us. Hence
your approaches to Chileans should tread a fine line. We are not in-
citing or organizing at this point; we are merely trying to get full infor-
mation as to the situation, the motives and thoughts of the key actors to
permit us to make that judgment.
3
Document 65.
378-376/428-S/80023
September 5November 4, 1970 203
72. Telegram From the Central Intelligence Agency to the
Station in Chile
1
Washington, September 9, 1970.
Ref: [less than 1 line not declassified]
2
1. It is reasonably clear, in exploring avenues to prevent an Allende
government from exercising power, that (a) the political/constitutional
route in any form is a non-starter and (b) the only prospect with any
chance of success whatsoever is a military golpe either before or imme-
diately after Allendes assumption of power. This cable is addressed to
the operational task of establishing those direct contacts with the
Chilean military which are required to evaluate possibilities and, at
least equally important, could be used to stimulate a golpe if and when
a decision were made to do so. At this juncture, this undertaking is to
be treated strictly as a [less than 1 line not declassified] matter and, as
such, is not repeat not to be discussed with [less than 1 line not declassi-
fied] or any other [less than 1 line not declassified] outside the Station. It
has not been coordinated with [name not declassified] and may not be
until in ultimate decision stage.
2. What it is desired for Station to do is to establish as many direct
contacts with influential military figures in near future as it possibly
can. We recognize the problems inherent in doing this securely in face
of present limited entree to military figures of stature and in doing this
surreptitiously (in effect) without blessing and cognizance of [name not
declassified]. If useful, HQS is prepared to bring in under any guise or
arrangement you deem best (and without knowledge of [less than 1 line
not declassified]) suitable [less than 1 line not declassified] personnel [less
than 1 line not declassified] to make such contacts.
3. To render maximum support to this effort HQS is in process of
querying [3 lines not declassified]. We will not bother you with all the lat-
eral traffic on this HQS phase of the activity except to indicate that all
traffic will be in [less than 1 line not declassified] and, as results thereof are
winnowed, you will be provided with leads and possibilities immedi-
ately. In this connection, HQS will be prepared to consider having any
individual with a useful and significant past contact to TDY to Santiago
[2 lines not declassified].
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Inter-
view with Secretary Kissinger, January 10, 1976. Secret; Priority. Printed from a previ-
ously redacted text; the full text was not found.
2
Message from Assistant Secretary Meyer and [name not declassified] requesting a
cold-blooded assessment of the realism and feasibility of any action by the military.
[Footnote is in the original.]
378-376/428-S/80023
204 Foreign Relations, 19691976, Volume XXI
4. HQS is quite aware of the delicacies, risks, and other problems
associated with this program. Despite these factors, weand this in-
cludes [name not declassified]place the highest priority on it as is ob-
vious from the foregoing. With respect to ref program, for the record
we are to proceed with our fair share of the burden in those delibera-
tions and activities as though nothing else is on the drawing board.
5. Finally, all of us certainly recognize what a burden you have car-
ried over the past months and what fine job you have done under, cer-
tainly, less than ideal conditions. This, we know, is asking undoubtedly
the most difficult series of maneuvers yet in the final stages of this oper-
ation. If there is anything we can do to support or assist your en-
deavors, we will if it is possible to do so. Please give us any thoughts
you may have in that respect.
6. [name not declassified] will arrive 11 Sept on [less than 1 line not de-
classified] to discuss this with you. [less than 1 line not declassified] will be
travelling on [less than 1 line not declassified] and has requested return
reservations [less than 1 line not declassified]. Please cable contact instruc-
tions for outside [less than 1 line not declassified] discussions. Do not re-
peat not discuss this visit with Chief, [less than 1 line not declassified].
73. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 9, 1970, 1800Z.
3548. Subj: One and Only One Hope for Chile. Ref: Santiago 3537.
2
1. Reftel sent last night is very accurate reflection of opinion of all
my senior colleagues in this Mission. It states the rationale for no hope
for Chile. The only dissenting opinion to my cable is my own. And in
writing that strange sentence I recognize the inevitable reaction it will
produce. But before St. Elizabeths is contacted, hear me out. Like Presi-
dent Frei I have at times to act like the character in a French play who
says even if my hands were full of truths, I wouldnt open it for
others.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Immediate; Nodis.
2
Document 68.
378-376/428-S/80023
September 5November 4, 1970 205
2. I reached the conclusion yesterday that neither the political right
nor the military merited our hopes for over-turning the Allende tri-
umph. Each can play a supporting role but they cannot act effectively.
3. I had also concluded that our contacts with these forces were be-
coming overly risky and that we had to disengage. Such disengage-
ment if properly executed could bolster the prudent but realistic hopes
I do retain.
4. I have always believedand I am alone today in this mission in
this faiththat the future of Chile would be decided by only one man:
Frei. I believe he is playing his cards with extraordinary astuteness in
the circumstances. I believe he knows that he can count on my support
when he needs it if as is a doubtful proposition, he will need it. I am
persuaded that no one in or out of Chile understands the political situa-
tion as he does when he is thinking calmly and purposefully. In a small
way I think I have helped him to stop lingering in gloom and to start
thinking positively.
5. I became persuaded too that it was necessary to create a mood of
US business as usual, partly because of my concern for longer-term US
interests whatever the results of the Oct 24th congressional runoff and
also because of my wish to contribute to an inflated sense of confidence
among the exultant Allende forces. I know that the mood of an Em-
bassy, despite the many precautions that may be taken, is quickly trans-
mitted to many outside; I have had painful experiences these past eight
years with leaks of sensitive matters from the Washington end. For the
one hope to materialize, I welcome too the growing exodus of US
newsmen who think the story has ended, that the US is truly unin-
volved and who are planning to return for the congressional runoff.
6. Finally I needed a justification in the form of a cable that will be
diffused throughout the Mission insofar as the thrust of it is concerned
to rationalize measures we shall be taking to reduce some of our activ-
ities. When we send our recommendations they should be read in the
light of the foregoing and addressees should not hesitate to question
me as to whether they really do mesh with my private optimism and
our official necessity to prepare prudently for the worst. I would appre-
ciate that all messages dealing with this subject and with this cable be
sent Eyes Only.
7. All politicians know that we have two kinds of friends: our
friends who like us and our friends who loathe us. We are in that posi-
tion in Chile; Frei is in that position; his Christian Democrats are in it.
The game is how to make these two varieties and some overt enemies
as well contribute to our purposes.
8. The Communists are keeping their eye on the military; I have
given them enough of a scent to put their nose to right against the men
in uniform. They are also worrying a great deal about the political and
378-376/428-S/80023
206 Foreign Relations, 19691976, Volume XXI
economic right and are doing their best to reassure all Alessandristas
except the very wealthy and the very militant. They cannot afford to be
distracted from these representatives of what they consider their inevi-
table enemies. But they are also lending more attention to what is hap-
pening in the PDC, in the largest party of Chile, and the force that will
determine the future of the country.
9. There are two political tendencies among the Christian Demo-
crats. One believes society can be structured to create paradise on earth;
they are dogmatic and eschatological. The other is more realistic about
man, more pragmatic about the possible, more political. The first is typ-
ified by Tomic; the other by Frei. The first group was genuinely sur-
prised by the election results and tends to believe that the results prove
their view of society; they consider Allendes triumph proof of their
own illusions. The other was shocked not by Tomics showing but by
Allendes relative majority and by the significance of it for Chile and for
them. In defeat, political parties are assailed by the forces that disunite
and by a delayed but no less strong sense of stick-togetherness for
survival.
10. As of last night, the PDC in the hands currently of Tomic and
the GOC still in the hands of Frei had survived the worst of the first
shock without much damage. Tactically their position has improved
considerably since Tomics typically ill-conceived embrace of Allende,
an act that was emulated by his closest circle of advisors. But what
could have been fatal did not occurthat the PDC formally recognize
Allende as President-elect. The partys national council in its meeting
Monday night
3
avoided that miss-step thanks to the delaying pressures
of Freistas and thanks to some, such as my old protagonist Senator
Fuentealba whose anti-Americanism is part of his strongly nationalistic
views. The fact that we did not intervene with the party in any way
may have helped to maintain his independent posture and to postpone
a PDC position re Oct. 24th. At the same time Alessandri cooperated by
not recognizing Allende and by retreating into silence, thus keeping
alive the possibilities for the political transactions that Chileans favor.
11. Frei on Monday also refused Allendes demand in person to
recognize him as the future President. He treated him icily. And yes-
terday the President met with the leaders of the three armed services,
ostensibly for discussions on the economic situation. The President has
also acted to keep Chile in as healthy an economic position as possible
and to stem the tide of panic that has overtaken many. I understand too
that he has moved to maintain the independence of those organs of
opinion he controls or can influence; I detect a shift as a result; there is
3
September 7.
378-376/428-S/80023
September 5November 4, 1970 207
newemphasis from the PDC that the game is still going on, that no final
whistle has blown and that Oct. 24th is still 45 days off.
12. The leaders of the armed forces now know as well as I do that
they simply have no confidence in their forces or themselves and that
they are totally dependent on the President. I think this recognition of
reality is a big plus; it places the military command in Freis hands and
is a very important card to be played at the right time. Similarly I be-
lieve the Cardinal, for all the impotence of the Church in Chile, will re-
spond to the PDC and Frei when and if the right moment comes. The
only question I have is the right, the political and economic right, who
must understand that panic is destructive and that their only hope is
Frei even if ultimately a new govt is even more reformist. I shall do
what I can and I believe that I have given the US business community
the guidelines (septel on that later today with wider distribution)
4
to
play a significant role. Incidentally that community is displaying with
only one or two exceptions from noisy but minor representatives a very
great degree of maturity and common sense; I consider myself fortu-
nate to have their full confidence.
13. The important immediate goal is to foster a sense of equal ma-
turity in the PDC and among the right. The PDC has that most pow-
erful of latent and active impulsesthe desire to stay in power. They
also have a meanswhat I called in the reftel a Rube Goldberg con-
traption. This political contrivance is the best, indeed the only way,
they can realize an aspiration that satisfies their crude individual in-
terests, the requirements of the party and the sense of doing something
for the country. I am troubled only by the equally human dislike of
Tomic for Frei, of Tomics propensity to do the reverse of Frei, and of
the reinforcement of this proclivity provided by his electoral defeat and
the inevitable comparisons with Frei. (These matters I will discuss in
another way in a septel.)
5
14. Forgive a somewhat crude analogy as the end of this message. I
have tried to place myself in the position of anotherof Chile and of
Frei. But I am painfully aware that it is only in the acts of sensual
pleasure that one measures the glory that man assumes in putting him-
self in the others place. Maybe I should stick to such activities but I
confess that my hopes, albeit modest, are a mildly exhilarating and sat-
isfying substitute for the moment.
Korry
4
Telegram 3580 from Santiago, September 10. (National Archives, RG 84, Santiago,
Classified Allende Files, 19681973, Box 6, United States/Chile Relations, SeptOctober
1970)
5
Telegram 3564 from Santiago, September 9. (Ibid., RG 59, Central Files 197073,
POL 151 CHILE)
378-376/428-S/80023
208 Foreign Relations, 19691976, Volume XXI
74. Telegram From the Department of State to the Embassy in
Chile
1
Washington, September 10, 1970, 0048Z.
147740. Ref: Santiago 3548.
2
Eyes Only for Ambassador from
Crimmins.
1. In spite of categorical nature your statements, I must assume Sta-
tion Chief is privy to reftel and its implications. Is that assumption
correct?
2. If it is not, you should understand that reftel must be discussed
by us with CAS Headquarters here as part of our continuing examina-
tion of courses of action possibly open to us. They, as well as we, have
taken Santiago 3537
3
at face value, and misconceptions created by it
must be corrected.
3. Please comment by 8:00 AM Thursday, September 10.
Rogers
1
Source: National Archives, RG 59, Central Files 197073, POL 14 CHILE. Secret;
Immediate. Drafted and approved by Crimmins; cleared by Rueckert in S/S.
2
Document 73.
3
Document 68.
75. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 10, 1970, 0335Z.
3568. Eyes Only for Crimmins From Korry. Ref State 147740.
2
1. I briefed extremely skeptical CAS on my opinions before
sending Santiago 3548.
3
I did not show him or anyone else reftel for fol-
lowing reasons:
A. Ever since Alessandri defeat CAS has been rather demoralized.
The departure from Chile of his most intimate friends and the general
1
Source: National Archives, RG 59, Central Files 197073, POL 14 CHILE. Secret;
Immediate; Eyes Only. A stamped notation on the first page reads, Action Copy.
2
Document 74.
3
Document 73.
378-376/428-S/80023
September 5November 4, 1970 209
helplessness of the situation added to the very profound distrust and
lack of confidence he has always had in Frei.
B. I want him to continue to wind down. At this point it is essential
that CAS not repeat not be involved beyond minimal informational
gathering.
C. I sent Santiago 3564
4
(PDC opposition to Allende taking shape)
and Santiago 3565
5
(Alessandri stays in runoff) that clearly confirm the
opinions I had expressed to CAS and all the other doubting Thomases
before the confirming evidence began coming in. They have read those.
I believe these cables and ensuing events are having the desired effect
of re-awakening the battle flame but I do not wish it to spurt into un-
wanted, unnecessary and even harmful fervor.
2. Santiago 3537
6
was approved totally by CAS and by other senior
officials in Mission. It represents the unanimous view that army is not
geared to do anything effective. It represents the unanimous view that
the military, aside from the unpredictable Viaux type muckup that is
always possible, will only play a supporting role to Frei. The same cable
represented the equally unanimous view that the economic and polit-
ical right also had only one remaining optionthe same as the military
in support of Freis play.
3. Alessandris statement on which I have worked since before the
elections and which was made a few hours ago has set off a political
storm.
7
It will, I hope, galvanize the panicked Alessandri camp into a
last ditch fight behind Frei who met in extraordinary session with his
Cabinet tonight. The Alessandri statement was cleared with Frei be-
forehand. It carries the support of Senators Bulnes (National Party) and
Senator Duran (Democratic Radical) who speak for the Alessandri
camp. I met tonight with Deputy Silvia Alessandri at her request. Her
only interest was to beg me for visas for her family; I sought to convert
this tearful scene into political action. I think I did.
4. The point of all the foregoing is that you have enough in the
cables cited in Para 1C above to discuss my true views with CAS
Headquarters there. And you can draw on my Nodis message as you
best see fit. Events have moved so fast that the contents of my Nodis are
really public knowledge here in that Alessandri and Frei have showed
4
Telegram 3564 from Santiago, September 9. (National Archives, RG 59, Central
Files 197073, POL 151 CHILE)
5
Telegram 3565 from Santiago, September 9, reported that Alessandri had an-
nounced that he would not withdraw his candidacy prior to the Congressional run-off.
(Ibid, POL 152 CHILE)
6
Document 68.
7
Alessandri announced on September 9 that he would resign the Presidency if
Congress elected him. (Chilean Rightist Wont Take Office: His Apparent Aim Is to Bar
Marxist From Presidency, New York Times, September 10, 1970, p. 2)
378-376/428-S/80023
210 Foreign Relations, 19691976, Volume XXI
their hands. What my colleagues have persistently correctly labelled a
Rube Goldberg contraption and which I alone have persisted in making
the repository of my hopes to overturn Allende is sputtering into ac-
tion. It is still a long shot that it will work but the odds are improving by
the hour. And the US need not do anything for the moment although
inevitably I expect some requests for some kind of material support.
5. In connection with the Rube Goldberg contraption, could you
tell Ambassador Doug Henderson to permit Professor Rosenstein-
Rodan to telephone me at Dept expense tomorrow. FYI I briefed the
good prof who is a confidante of Frei on the contraption a week before
the election and arranged for him to provide some necessary moral
support for Frei from non-Americans with the potential to touch the
President. Now is the time for him to come to the aid of this party and
the prof apparently understood that need by having Henderson mes-
sage he would be available for calls in Washington starting Sept 10th.
He should be informed that overseas calls are probably being tapped
now.
6. Dare I conclude by saying put yourself in my place?
Korry
76. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 10, 1970.
SUBJECT
Chile
It is important that you focus on the attached three cables. They are
as extraordinary as any I have ever seen, and they reflect a very delicate
situation.
In a separate memo of September 9 I enclosed a long assessment
cable from Korry (Santiago 3537)
2
written in the first person, which ex-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Sensitive; Nodis. Sent for information.
Kissinger initialed at the top of the page.
2
Document 68.
378-376/428-S/80023
September 5November 4, 1970 211
pressed his conclusions that Allende could not be prevented from
taking power. In the Nodis cable at Tab A (Santiago 3548)
3
Korry says
that the previous cable reflected his staffs view but not his! He implies
in that cable that a convoluted political formula resting on Frei is the
only hope, but his reasoning and meaning are unclear.
In the cable at Tab B (State 147740)
4
Crimmins (ARA) asks Korry if
his CAS knows what he is thinking, pointing out that we have to talk to
CIA to come up with the plans you asked for and that we are confused
because of his previous cable.
In the Nodis cable at Tab C (Santiago 3568)
5
Korry says he has not
taken CAS into his confidence. There is the clear hint that he is oper-
ating in some form and may be making commitments. But it is not clear
what he is really doing, or what it is he really thinks. Para 5 of this cable
is especially worrisome if he is operating in an undisguised way
through third parties such as this Professor Rosenstein-Rodan or in
face-to-face contact with walk-ins such as Alessandris daughter. The
last sentence of this cable is revealing. He is worried that he will be ac-
cused of losing Chile and thinks he has to do something.
I have the most uneasy instinctive feeling. His cables make Korry
sound as if he is under too much stress, almost hysterical (see para 14,
Tab A). I am most of all concerned that he is operating in such a way as
to present us with problems, faits accomplis and perhaps most serious
situations. His quarterbacking must be perceived as at least quasi-
official.
6
3
Document 73.
4
Document 74.
5
Document 75.
6
Vaky wrote by the Chileans at the end of the sentence. Below it he wrote, I am
working on a reining in instruction.
378-376/428-S/80023
212 Foreign Relations, 19691976, Volume XXI
77. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 11, 1970, 2244Z.
3640. Subj: Some Hope for Chile? Ref: Santiago 3537, 3538.
2
1. Last Saturday night,
3
President Frei, mulling the election results,
was like a quarterback of the last place Falcons after being battered by
the Vikings rush for 59 minutes. With only 50 seconds to go, it was
fourth and 12 with the ball on his one inch line. Even the wives knew
the call. As the hobbled quarterback took the snap, he bobbled the ball
and stumbled like a holy roller in communion with a higher power.
Somehow he faded to the white line of the end zone before flopping an
end over end (shades of Joe Kapp!)
4
pass to his aged, unhinged right
end, Alessandri. The receiver brought the crowd to its feet with his
famed St. Vitus step, a kind of palsied shuffle that caught napping the
left safety, Allende, a ball-stealer of no mean repute. Squeaks of hope
and roars of anguish welled from the stands as Alessandri clutched for
the ball and fell across the sideline with Allende atop. First down and
ten, the ref ruled, as the Vikings stormed from their bench. When, to
coin a phrase, the rhubarb ended, the ball was on the 13 and shifty Frei
quickly ran off a series of short flips that bought it to the 24. Now there
were 43 seconds left and the Vikings with their eleven best fielded were
spoiling for blood.
5
2. We have 43 days to go in what might well be the last of the com-
plex Chilean political dramas. Without doubt, it is of transcendental
importance and certainly no game. The sequence that has produced a
ray of hope for the beleaguered defenders of democracy are:
A. A midweek statement by defeated Alessandri stating he would
not accept election by Congress Oct 24th to be President and would re-
sign. What he actually meant was that if Congress should elect him
over Allende, he would step aside for Frei or possibly another PDCer in
new elections. Considering the compatibility of Alessandri and Frei,
1
Source: National Archives, RG 59, Central Files 197073, POL 15 CHILE. Secret;
Priority; Limdis. Repeated to Asuncion, Bogota, Brasilia, Buenos Aires, Caracas, Guate-
mala, La Paz, Lima, Mexico City, Montevideo, Panama, Quito, Rio de Janeiro, San Sal-
vador, Santo Domingo, and USCINCSO.
2
Documents 68 and 69.
3
September 5.
4
Joe Kapp was a quarterback for the Minnesota Vikings from 1967 until 1969.
5
In telegram 3668 from Santiago, September 14, Korry wrote, We noted with in-
terest the coincidental fact that the Vikings (Minnesota) won their weekend game with a
touchdown pass in the last five seconds. (National Archives, RG 59, Central Files
197073, POL 151 CHILE)
378-376/428-S/80023
September 5November 4, 1970 213
this maneuver might be compared to, say, President Hoover stepping
aside for President Roosevelt.
B. The Armed Forces after goose-stepping through pro-forma
bluster discovered to no ones surprise that they are paper tigers. They
cannot count on their troops, they believe and they cannot count on
each other, they know. In any event, it has been so long since they acted
like an army and so long since they learned to behave with civility in a
democratic structure that they are more like Ferdinand the Bull than
their Spanish progenitors. Frei steered them with dexterity into self-
satisfying support of his constitutional play. (Whether they can stay
there or will succumb to the lures of Allende cum Tomic is not an en-
tirely closed question.)
C. The Christian Democratic Party, a disparate collection of politi-
cians covered by an umbrella with stripes of trompe loeil morality and
genuine populism, initially behaved like Gadarene swine. Tomic led
them to the Marxist slaughter-house by embracing Allende before TV
last Saturday; his troupe of fools and knaves rushed behind in his foot-
steps. But by mid-week because of the indecent haste with which the
Popular Unity forces sought to seal their relative majority of 36 percent
of the vote as a popular mandate and because of the heavy-handed
efforts of the Marxists to silence the voices of dissent and because so
many of Chiles professionals began to leave the country, second
thoughts in this land of the eternal second thought began to assail some
of the more pragmatic members of the delusion-prone party. (With
some, second-thoughts probably came when it became apparent that
situation permitted party construct strong position from which to bar-
gain with and extract concessions from Allende.)
D. The Alessandri supporters, at least those who could keep their
heads, recognized that Frei was their only chance and that even if his
long-shot gamble paid off, they would no longer enjoy their former
privileges. As several have told me, they did not realize how deep and
broad was the Chilean desire for reform. Hence they are rallying be-
hind Frei in their way to save the country and their honor. They are
fighting for the right to live in Chile.
E. A number of truly independent figures, men whom I know who
have broken with Frei for not pushing reforms fast enough or for accel-
erating them, have rallied to his cause too. They include some of the
best minds in this country and their adherence is a meaningful plus in
organizational and brain power.
F. The Church in the form of Cardinal Silva has remained as silent
and as prudent as can a church with no great influence over the mass
and with too few clergy to do much more than steer for safety. How-
ever the Cardinal will take those symbolic actions necessary to help
Frei when and if the moment presents.
378-376/428-S/80023
214 Foreign Relations, 19691976, Volume XXI
3. We have described in a series of cables howthe Communists and
Allende have reacted to this new opening to the future. The strongest
weapons they have are their encroachments on the freedom of expres-
sion combined, as it is, with the trumpeted menace of civil war. The
Communists are as united, energetic, cool, determined and effective as
they were during the campaign they won for Allende. They are em-
ploying sedatives and scares, indeed every weapon in the manual, as
we have reported in other messages. Even the Alessandrista traders in
the central markets are impressed by promises from Allendistas that
their profit margins will be increased from 20 pct to 30 pct.
4. It was the threat of civil war that frightened enough of the
middle class women into voting for Tomic instead of Alessandri last
Friday and thus providing Allende with his first placement. It was and
is the threat of violence that has stopped the saber-rattlers in the Army.
Fear for country and for personal future combined with artful bland-
ishments are dividing the Armed Forces and creating a mood of ration-
alizing Allendes right to the Presidency. Similarly the Christian Demo-
cratic Deputies and Senators are torn and many who might fight to the
end want guarantees of some way out of Chile if they lose the struggle.
5. I would not be surprised if the two campsFreis and Al-
lendesturn the countrys most patriotic holiday of September 18th
into a turbulent outpouring of partisans. At the least Frei, who is the
focus for the military parade, will be acclaimed by a mob his supporters
are organizing.
6. At this juncture his team believes it has 38 of the 74 PDC Con-
gressmen firmly aligned (the seventy-fifth PDCer had been in a coma
for five months). With the 45 Alessandristas in Congress and perhaps
five radical defectors, the paper total at this point would thus be 88 for
the phantom Alessandri. On the other side, there are 75 Allendistas
plus 17 PDCers who currently favor the Marxist solution for a total of
91. And in the middle are 19 PDCers still sitting on the fence. The PDC
in its declaration last night by Party President Prado has kept all op-
tions open, thanks to Freis stage-managing of defensive forces against
Tomics death wish.
7. Frei has kept himself and his name out of all compromising posi-
tions. He acts officially as the President of all Chileans. He refuses to
recognize Allende as President-elect (although no less than the Presi-
dent of the Inter-American Bank in Washington, Felipe Herrera, has
made such an indecorous commitment). He refuses to establish polit-
ical liaison with Allende although he has acceded to requests of first the
Allende and then the Alessandri forces to have liaison with the Min-
ister of Finance in the latters efforts to stabilize the worsening eco-
nomic situation. He refuses to allow anyone to mention his name as the
future candidate for a runoff against Allende; instead he posits others.
378-376/428-S/80023
September 5November 4, 1970 215
8. In short, for a hobbled player, he is surprising alert and alive in a
long-odds game that will get very rough indeed as those seconds tick
off before Oct 24th.
Korry
78. Memorandum From the Ambassador to Chile (Korry) to the
40 Committee
1
Santiago, September 11, 1970.
SUBJECT
Ambassadors Response to Request for Analysis of Military Option in Present
Chilean Situation
2
1. We believe it now clear that Chilean military will not repeat not
move to prevent Allendes accession, barring unlikely situation of na-
tional chaos and widespread violence. All info available to us indicates
that Armed Forces chiefs are unprepared go beyond seeking minimal
guarantees from Allende which in their view would protect existing
rank structure and prevent politicizing of military. (We regard such
guarantees as virtually worthless over the long haul.)
2. Our own military people have had fairly extensive contacts with
their Chilean colleagues during last few days. They are unanimous in
rejecting possibility of meaningful military intervention in political sit-
uation prior to October 24 Congressional election of President. There is
apparently some talk among some officers of doing something after
that date if Allende is elected. In our judgement such mutterings are
not to be taken seriously.
3. You will have seen from our recent reporting that the Ales-
sandrito new electionsto Frei formula has acquired new life. We
cannot yet be optimistic; we believe that the scheme might just possibly
work if intense pressures on PDC build up (disintegrating economic
situation, spreading fear aroused by premature Communist moves,
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. Although the memorandum is dated September 12, Korry noted
in Document 83 that it was sent on September 11.
2
As chairman of the 40 Committee, Kissinger had requested Korrys cold-blooded
assessment of the situation in Chile. See Document 70.
378-376/428-S/80023
216 Foreign Relations, 19691976, Volume XXI
etc.) and if Frei succeeds in what is beginning to look like an all-out
effort.
4. Military in their current and customary state of flabby irresolu-
tion have no part to play in this scenario until the final act. Whatever
the outcome of any discussions with Allende which may take place, we
foresee no significant, sustained pressure from that quarter on Frei and
PDC. We have to accept fact that this military establishment simply
lacks cohesion and political purpose; its only real unifying instinct is to
survive so as to enjoy minor privileges (cars, houses, pensions and the
like) and dazzle parade-ground audiences. Fears in the Armed Forces
of what a Marxist regime will mean for the institutionand they do
existcan all too easily be tranquilized by Allende appeals to these
petty self-interests, accompanied by the hollow guarantees to which
we have referred. In all fairness, we must add that military are also
afflicted by nightmare of confrontation in the streets with popular
forces and are unwilling or unable to consider how they might pre-
empt or contain such forces. Unless backed by unambiguous constitu-
tional and legal authority, they would shrink from prospect of having
to shoot civilians and others provoking what they see as possible civil
war. Armed forces are so disorganized and inexperienced in these
matters as to make impossible the kind of quick bloodless military in-
tervention (including prior roundup of leftist leaders) we are familiar
with in other Latin American countries.
5. As stated, however, military would have a vital part to play on
October 2425 if scenario were to unfold favorably. Troops in the back-
ground prepared to maintain order in Santiago, and to ensure that the
constitutional will of the Congress prevailed, would be necessary. It is
our judgement that Frei again is the key to this problem. The com-
manders can be expected to obey his orders, and we think it likely that
the troops, despite some Marxist penetration, will obey theirs. It seems
to us, then, that the success of such an enterprise in all its aspects must
depend on the Presidents will and skillspersonal qualities on which
experience counsels we cannot pin more than modest hopes.
6. What we are saying in this cold-blooded assessment is that op-
portunities for further significant USG action with the Chilean military
are nonexistent. They already know they have our blessing for any se-
rious move against Allende, and we can manage to repeat the message
if circumstances should so dictate. But this is as far as we can prudently
or reasonably go. There is no group or individual within the Armed
Forces around whom a coup effort with any real chance of success
could be organized. Even Viaux is reportedly seeking to meet Allende.
We repeat that our best intelligence makes it clear that nothing will
move the Armed Forces on their own except near apocalyptic develop-
ments. For the time being it is therefore our intention to restrict our ef-
378-376/428-S/80023
September 5November 4, 1970 217
forts in this field to normal contacts. More could be risky to us and
harmful to the Frei effort.
7. Although the foregoing does not respond specifically to hypo-
thetical questions you put to us,
3
we believe that our analysis does ade-
quately cover the realities in terms of 40 Committee deliberations. We
also realize, however, that the shift to what can be called the political
alternative will raise new questions about possible USG political action
to support new-election scenario. These may be satisfied by making the
following points: (a) There is considerable loose talk among rightists
and certain Christian Democrats concerning the buying of key votes in
Congress. At present this is nothing more than wild speculation. In any
case, vote buying will be a waste of time and money unless PDC junta
takes party decision favorable to scenario: i.e., to instruct parliamenta-
rians vote for Alessandri (most unlikely) or to allow them free choice.
Otherwise, Allende will have more than enough votes. Junta, which
has more than 400 members, can neither be bought nor directly influ-
enced by U.S. action. If we reach the point, we will of course be pre-
pared recommend immediate exploitation any realistic opportunity for
manipulative action in Congress. (b) In meantime, Ambassador is in
close but discreet touch with key people around Frei who are transmit-
ting to and from that central figure information, ideas, influence and
implicit evidence of USG support. Ambassador is also using range of
contacts and methods in quiet very contained effort to create propitious
atmosphere for scenario. He will be reporting separately on these
moves. Embassy and CAS are maintaining lowest possible profile and
non-involvement beyond necessary intelligence collection activities.
8. Situation is still too fluid and uncertain to permit intelligent as-
sessment of prospects for effective covert action under Allende. We
will, however, be working on identifying possibilities and will report
as soon as realistic recommendations can be made.
3
See Document 71.
378-376/428-S/80023
218 Foreign Relations, 19691976, Volume XXI
79. Backchannel Message From the Ambassador to Chile (Korry)
to the 40 Committee
1
Santiago, September 12, 1970.
Following was drafted at Ambassadors instruction as additional
input for 40 Committee deliberations. Ambassador is in Vina del Mar
today in connection meeting there of OAS Education-Scientific
Council. Any amendments or additions he may have to this message
will be forwarded promptly.
1. Ambassador had three separate, unannounced visitors at resi-
dence evening of September 11, each coming alone and leaving before
the next arrived: Min Def Sergio Ossa, Senate Pres Tomas Pablo and
former Min Finance Raul Saez. First two had same message: Saez has
been designated as channel between Amb and group in GOC/PDC (in-
cluding Frei) who are working to bring about anti-Allende vote in
Congress and new Presidential election. Saez prepared to transmit
ideas and information to and from. He is old and close friend of Ambs
with whom frequent contacts are only natural. He is also man of un-
questioned rectitude who, interestingly enough, has not spoken to Frei
for two years as a result of the dispute that arose at the time he left
GOC. It was agreed that further meetings with Ossa, Pablo or other
prominent figures in the group would be restricted to essential occa-
sions and would only take place under most careful security condi-
tions, [less than 1 line not declassified]. (Amb will be meeting with Frei
today in Vina. Min Education Pacheco, a notorious unguided missile,
insisted on arranging call by Asst. Sec. John Richardson on President
with Amb accompanying. Initiative was entirely Pachecos.)
2. Current line up. Ossa told Amb that Frei is committed to for-
mula, all-out to make it work, and prepared offer himself as candidate
for Presidency if it does. All of Cabinet is with President except Justice
Min Gustavo Lagos and Pacheco. (Former indicated his leanings by
leaking to leftist media data on passport applications of El Mercurio re-
peat El Mercurio publisher Agustin Edwards and family; latter de-
scribed by Ossa as floating off in space.) Ossa and Pablo confirmed
that 38 PDC parliamentarians are now lined up to vote for Alessandri,
with 17 prepared back Allende and 19 undecided (see Embtel 3640.
2
We
will send separately actual breakdown by names.) Organization of anti-
Allende PDC forces is apparently rather complex. There is committee
of Lower House Deputies, including such stalwarts as Carlos Sivari
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive.
2
Document 77.
378-376/428-S/80023
September 5November 4, 1970 219
and Presidents nephew Arturo Frei. There is also a working committee
of individuals not directly connected with Congress or GOC. Key man
in congressional effort is Deputy Jorge Santibanez (whose contacts with
Embassy have now been terminated). Others, including Deputy Emilio
Lorenzini who has strong ties to Campesino organizations, will play
important roles in creating support for anti-Allende position among
party bases. (This latter is an essential element if the formula is to work.
As explained in our previous message, the party junta repeat junta
must take a favorable decision. That body will be heavily influenced by
rank and file attitudes.) We will provide more later on organizational
and tactical details.
3. U.S. input. On his own initiative Ossa spelled out what he
needed from us: (A) Above all, those participating in this effort who are
the most firmly committed and/or the most vulnerable to retaliation
from the left, want assurance that there will be a way out of the country
for them and their families if they fail. Amb pledged that he personally
would do everything possible to arrange that sufficient commercial air
transportation is available out of Santiago during Oct 25Nov 4 period.
Red tape problems currently hindering quick exits would, of course, be
up to GOC. (B) Ossa has little confidence in the intelligence he is re-
ceiving on attitudes and maneuvers among his own military. He is
fearfulwith some reasonthat armed forces will strike a bargain
with Allende which would close the door on his group and its formula.
Ossa said he wanted info from us, the only source he considered reli-
able. Amb explained our limitations in this field, but indicated we
would do what we could on very discreet basis to help keep Min Def
abreast of developments in military. (C) Ossa believes it important that
the lawyer son of Anacondas Guillermo Carey be taken out of Chile
ASAP. Latter, an indiscreet bumbler, is egging General Viaux on,
feeding his pathetic Peronist ambitions. This feeble maneuver muddies
the military waters and poses the gravest risks for the Anaconda (and
US) position in this country. Amb said he felt Careys early departure
could be arranged.
(D) Ossa asked for help in listing and locating those key indi-
viduals in the Marxist camp whose absence from Chile might be desir-
able if it comes to point of possible violent leftist reaction to congres-
sional decision against Allende. Amb made no commitment.
(E) Of prime psychological importance, particularly in terms of
PDC junta repeat junta action, is getting the word to the Chilean people
as to what is really happening here: e.g., aggressive FRAP
3
moves to
grab levers of local and institutional power in advance of Oct. 24; intim-
3
In this sentence, FRAP is crossed out and replaced with UP.
378-376/428-S/80023
220 Foreign Relations, 19691976, Volume XXI
idation of non-Marxists in the media, universities, campo, local organi-
zations, etc.; financial panic, rising fear of the Marxists and their inten-
tions, etc. This picture can best be fed into the country from abroad;
reports from abroad unfavorable to Popular Unity are easier for the do-
mestic media to handle under present circumstances and have a con-
siderably greater impact than stories originated locally. In Ossas
opinion we could be of great help in this exercise. Amb said he would
look into how we might discreetly assist, while pointing out that the in-
formation itself must come from Chilean sources.
(F) Finally, Ossa passed on rumor from university that two
Cuban ships are bound for Chile with arms. Amb skeptical, but said we
would check.
4. Question of future U.S. posture. For his part, Pablo told Amb
that question of USG aid relationship with an Allende govt is critical
factor affecting the choice PDCers must make. Tomic is saying that
U.S. assistance will not be cut off; that world now changed and old
Cold War standards no longer apply; that heTomichas the connec-
tions in U.S. Congress (Fulbright, Kennedy, et al.) To assure a reason-
able attitude and continued aid. Those not convinced by this siren song
are deeply preoccupied. They fear U.S. will allow Chile sink into
oblivion as economic troubles pile up. Prospect of substitute Soviet aid
is another element being weighed in the balance. Amb made it clear
that he personally would oppose any initiative for a U.S. bail-out of
Chile under Allende, and reminded Pablo of continuing Soviet efforts
lighten their Cuban burden, preferably by transferring some of it to the
U.S. He also recalled that Soviets responded to Peruvian approach on
aid with advice to make it up with the U.S. Hopes for substantial sup-
port from that quarter should be regarded as very thin indeed.
One final point on Pablo conversation: he reported from personal
observation that Tomic was summoned to the telephone election night
to take a call from the State Department. We can add that rumor is all
over town that Tomic has received some kind of direct message from
the Dept. Any light you can shed will be appreciated.
5. The U.S. role. Amb sees possibilities for meaningful political ac-
tion on the ground here in support of the formula as presently limited
to the exchange of the kind of ideas, impressions, information and the
like which the Saez channel will make possible. Pablo, Ossa, Saezall
are in agreement that the USG must stay completely in the background;
any showing of our hand would be disastrous in terms of reactions
from such key PDC nationalists as Renan Fuentealba and as confirma-
tion of Marxist line that effort bar Allende is an imperialist plot. Saez
and those he will be communicating with on the other end can be
trusted. It is the most discreet possible kind of relationship, but also one
which will enable us to monitor this effort closely while exerting influ-
378-376/428-S/80023
September 5November 4, 1970 221
ence and providing counsel. By keeping in close touch we can also de-
termine when and if the contribution of U.S. resources and/or political
action mechanisms might prove decisive. In meantime, remainder of
this Mission will hold to line of absolute non-involvement in the
Chilean political process, restricting our activities to normal informa-
tion collection.
80. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 12, 1970, 0125Z.
3642. Eyes only for the Secretary from Ambassador Korry. Ref
State 149384.
2
1. To answer your questions in chronological order:
2. The entire Embassy has formally been instructed to seek no con-
tacts and only respond to requests for appointments. In certain cases
we have urged that the Congressmen and other politicians seeking re-
peated appointments desist from coming to this Embassy. Furthermore
I requested CAS 48 hours ago to prepare a message to his Director with
my approval informing the latter of our joint recommendation to cease
all CAS political action mechanism. In fact such CAS political action
stopped several days ago. The DAOs office has been similarly in-
structed to hold contacts to the barest minimum. The US business com-
munity was similarly advised by me as reported.
3. As for the contacts we have, the message we give to them is con-
tained in the Presidents message to the Congress outlining known U.S.
attitudes.
3
We have made no commitments; we have turned aside re-
quests for money; we have held to our line of no intervention in
Chilean internal affairs.
4. As for worked on as an operative verb, it was a poor one and I
can only apologize that the press of much business does not make for
careful drafting of every message, especially on three hours sleep a
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Secret;
Immediate; Nodis; Eyes Only. A stamped notation on the first page reads, Action
Copy.
2
Dated September 11. (Ibid., POL 14 CHILE)
3
Reference is presumably to Nixons first annual report to Congress on U.S. foreign
policy, February 18, 1970. (Public Papers: Nixon, 1970, pp. 116190)
378-376/428-S/80023
222 Foreign Relations, 19691976, Volume XXI
night. I had reported prior to the elections via CAS channels that it was
essential that Alessandri not cede to Allende if flexibility were to be re-
tained. That statement of fact was conveyed to Alessandri by Chileans
to whom the fact had been stated by CAS reps and who then acted
upon it.
5. As for methodology, prior to receipt of reftel tonight I had in
quick and unexpected succession three different high level reps of Frei
visit my home, each barely missing the otherMin Defense Ossa, Pres-
ident of Senate Pablo and ex-Finance Minister (and one of original wise
men of Alliance for Progress) Raul Saez. Each was seeking information
of what we knew of situation and indirectly asking for advice. Equally
indirectly they received the advice but nothing committed the USG at
any time. However if you wish I shall inform them that the USG is con-
sidering the question of our attitude to Allende govt and that we
cannot give any indirect or direct encouragement to their actions. Such
a message, I should add, will guarantee the election of Allende.
6. The questions put to me in the CAS Sept 9 cable were answered
this evening and I believe are available in CAS Headquarters/Wash-
ington.
4
I cannot check at this hour to verify that they have actually
been sent from here by their communications. In any event it clearly
rules out any military role.
7. I wish to make it most clear that if the Frei forces are left totally
to their own devices and resources intellectual first and material
second, or if they meet with the posture laid out in para 6, it is my very
considered opinion that (a) Allende will be elected (b) that the USG will
be blamed by many and publicly by the most influential after his elec-
tion for having taken that decision. I want to be equally straight-
forward in saying that if such are the desires of the USG I shall carry
them out but with those clear assumptions in my own mind.
8. I appreciate your sympathy. I would only note that the same
hesitations and same concerns were expressed in the pre-electoral pe-
riod. Nothing warranted them and our actions were carried out
without a hitch of any kind that exposed the US except for one known
to the Dept done without my knowledge. We are in a very fluid situa-
tion in which events overtake planning as the message to CAS Head-
quarters clearly states. An act of commission [omission?] is no less an
act. What one does not do is as much an action as one does do. The
question of whether Chile will be a Communist state or not is being de-
cided now. I would hope and I would expect that a decision as to which
the US would prefer and what it permits to be done about it will not
await committee meetings whose decisions will once again be over-
4
Documents 71 and 79.
378-376/428-S/80023
September 5November 4, 1970 223
taken by events. In the interim I shall bear uppermost in mind your
views.
Korry
81. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 12, 1970, 2340Z.
3644. Subj: Frei Pessimistic But Not Discouraged!
1. Asst Secy John Richardson and I had 45 minute conversation
alone with Frei today at Presidential Palace in Vina del Mar where OAS
sponsored educational conference being held. From conversation it
was obvious, contrary to my original interpretation, that Frei had set up
meeting in order to have direct private access to highest levels USG.
Despite breakneck 100 mile per hour efforts I arrived 15 minutes late
and what follows is reconstruction of conversation as coordinated with
Richardson.
2. Frei gave a melancholy recital to Richardson of campaign. He
said he had tried in the final weeks of the campaign to convince his as-
sociates in the GOC, his friends in the Christian Democratic Party and
some outside that there was a very real danger of an Allende first ma-
jority. He had told this to the editor of El Mercurio in the final days but
the latter had scoffed, citing polls and other data. (It is possible Frei was
referring to Augustin Edwards as Editor.) No one had heeded his
warnings.
3. Frei outlined the present perspectives stating he was pessi-
mistic but not discouraged. When Richardson asked if there were no
hope, he replied that there was hope of preventing Allende from as-
suming power but the Oct 24th vote in Congress depended largely on
whether the climate in Chile remained calm and whether Allende and
his forces encountered growing concern. He gave details on the current
economic situation, (repeating what we have been reporting), stating
that the long-term harm to Chile could be very grave.
4. I arrived at this point and President went on to say he was cer-
tain that his views would be in 100 percent accordance with mine. First,
1
Source: National Archives, RG 59, Central Files 197073, POL 12 CHILE. Secret;
Immediate; Nodis.
378-376/428-S/80023
224 Foreign Relations, 19691976, Volume XXI
he considered it 98 percent certain and he said he thought he was un-
derstating the case, that Chile under Allende would be a Communist
country. Secondly, he thought the Armed Forces would do no more
than preserve the constitutional order, that the Generals felt the politi-
cians had to find a solution. The Armed Forces were innocents who
were being beguiled by the promises emanating from the Allende
camp but the President felt they would most likely maintain law and
order and sustain a legal political process. Thirdly, the modest bank
run, the drawdown on the savings and loan associations, the tre-
mendous brain drain of professionals quitting Chile, the layoffs of
workers, the dry up of credit, the cutbacks in production and the eight
week standstill on the exchange rate meant inevitably at least ten to 15
more points of inflation (to a rate of 40 to 45 percent at year end). Such
deterioration could have an effect on the political situation. Fourthly,
there was a widespread feeling in Chile because of the lack of any vio-
lence on or after election day and because of the faith in the fair play of
democratic processes that Allende should have his chance in the Presi-
dency. A great many still did not understand the consequences.
5. Frei then said the US should say nothing, that it should be as cor-
rect as it possibly could. I interjected that all the USG had said until
now was that a constitutional process was continuing in Chile and that
whoever became President at the end of that process we hoped that
good relations could be maintained. Excellent, said Frei, adding to
Richardson that the performance of the US Embassy during a trying
year had been and was impeccable.
6. Frei said he wanted for us to know what had transpired in his
last conversation with Allende a few days ago and he wished us also to
know very confidentially that he had covertly tape-recorded the con-
versation, an action that he described as of great importance. Allende,
who had arrived with his advisors asked after some general discussion
if he could see the President alone. When alone he asked if they could
speak as old friends and not as future President to outgoing President.
Frei agreed (explaining to us that he had always had good relations
with Allende over the years). Allende said he was very concerned by
the rightist machination to wreck the economy and to create panic.
Frei replied that it was no plot but the reaction of a lot of modest people
to Allendes own statements and to the Popular Unity platform. (Frei
told us similarly it was the first time that Allende & co had not blamed
the imperialists.) Frei gave Allende an example of what his program
and statements provoked. The Federal German Republic, he told Al-
lende, had stopped 50 million marks credits to Chile after learning of
Allendes electoral victory because of his pledge to recognize East Ger-
many. (FYI German Amb told me in midweek that an Allende friend
had raised this story with a FRG Emb officer and that the Ambassador
378-376/428-S/80023
September 5November 4, 1970 225
genuinely knew nothing of it and had so replied. However my excel-
lent colleague is prepared not to deny such stories now if it were of
utility.) Frei said that Allende simply had not stopped to consider such
matters.
7. Allende requested that Frei make a public statement to calm the
Chileans and get them back to work. Frei replied that the panic was not
of the GOC doing, that indeed his administration had taken a number
of counter-steps to ease the situation and that it was Allendes responsi-
bility to tranquilize the country.
8. Allende said that if the PDC were quickly to adopt a position of
recognition of Allende as President, the country would be tranquil and
get to work. Frei agreed that might be so but that if the PDC National
Council took such a decision, he would be the first to refuse to accept it.
But why, Allende protested. I have been a democrat all my life, he said;
I believe in free elections and in free opinion. Yes, said the President, I
believe you, Salvador and if it were you alone, there would be no
problem. But your Popular Unity is composed of a Socialist Party of
which at least half detests you; the Radical Party is a collection of cor-
rupt hacks; and there are few other minor hangers-on. You depend
upon one force and only one force, the Communists, who are cold and
calculating and who will convert Chile into something quite different
than your conception. But, said Allende, I would resign if they did that.
Frei recalled that Urrutia had resigned as President in protest against
Castro. Who remembers him today, he asked and had Cuba become
any less a Communist state? No, said Frei, he was sorry but the record
showed that wherever the Communists had the power it was an irre-
versible road and in Chile they would have the true power under
Allende.
9. When I asked if Allende had said anything about US or Soviet
aid, Frei said that the subject had come up and that he had asked Al-
lende if he knew that US laws regarding a foreign governments recog-
nition of Cuba and North Vietnam meant an end to US aid. Frei said
that Allende had never reflected on the subject and that he, Frei, had
gone on to cite the example that all of Chiles electric energy is depend-
ent on US and West German machinery. Frei added that he could add a
great number of other industries and that Chile was very unlike Cuba.
In Cuba, he had told Allende, it was only sugar, tobacco and cattle; in
Chile there is considerable industrialization, a great need for foreign
credits and a dependence on foreign supplies. Allende said it might
take six years to find other sources for the state power companies. Say
only three years, Frei answered but do you realize what would happen
in Chile in those three years and the political consequences of such
changes as the Communists hardened their control?
378-376/428-S/80023
226 Foreign Relations, 19691976, Volume XXI
10. I told Frei at this point about my conversation with Senate Pres-
ident Pablo last night in which the PDC Senator had been most insistent
on how the US and the USSR might react to an Allende govt. (I believed
that the President had a full report on that conversation and that we
were doing an Ev-Charley routine but I preferred it that way for the
record). I had told Pablo about the same laws Frei had cited to Allende
and said the ball was in Allendes court, not ours. As for the Soviets, I
had recalled that they had been trying for almost two years to unload
on US part of the cost of keeping Cuba going and that in Peru they had
replied to the juntas request for large aid by suggesting the GOP work
things out with the US.
11. Frei said that Allende had asked him for advice. The President
had suggested that the only way Allende might maintain some inde-
pendence was to keep inviolate the Armed Forces; they might be his
only salvation if he chose at some point to challenge the Communists.
12. Frei said that the day after the conversation with Allende, he
had been told by a close friend of the latters that Allende had been very
satisfied. Allende had said that it was Frei who had provided his best
advice and that his description of the President had been that of a wor-
shipper before God. (It is significant that Allende has been applying the
sedation very strongly to Chile, that he did approach us through Sen-
ator Miranda and that he has been doing his best to seduce the Armed
Forces with guarantees.)
13. I asked Frei the following questions as the hour struck for the
lunch in the next room with all the OAS Education Ministers:
A. Would it help his position and his country if the world press,
particularly European, were to focus on the manner in which the Com-
munists are encroaching on all the media? Stupendous, said the Pres-
ident, adding, do not forget that they are doing it in the low income
neighborhoods too (where according to a PDC Deputys charges pub-
lished in Mercurio today, they are intimidating Tomic supporters,
physically if necessary).
B. Would it help his position and that of Chile if the world press
were to publish stories about the economic situation, what was likely to
happen to aid, what the consequence for Chile would be etc. Stu-
pendous, said Frei.
C. Would it help him and help Chile to have the world press and
particularly highly reputed professional journals publish stories about
the Armed Forces, speculating only on how a country with three less
than friendly neighbors could manage the job of totally replacing most
of its equipment, particularly when hard currency reserves would be
eaten up by increasing food imports, etc. Such stories would be in very
serious form and would not deprecate the Armed Forces in any way.
Stupendous, said Frei.
378-376/428-S/80023
September 5November 4, 1970 227
14. Frei told me after the big lunch that he had been most im-
pressed with Richardson and cited his intelligence and serious manner.
I took advantage of this last brush to tell the President that I felt that his
Ambassadors description to the State Department of the current play
as a gimmick had had an effect that I believed was not in tune
with the Presidents. Frei said he was particularly grateful for that
confidence.
15. OAS SecGen gave his xerox of the Chilean situation to me after
lunch: Chile is not Cuba and Allende is not Fidel; he is a democrat and
there is nothing to worry about here. Since I regard Gallo as a fatuous
imcompetent, one of a triumvirate that run the key Latin American or-
ganizations as ineffectively, inefficiently and unimaginatively as is pos-
sible (the other two being Herrera of the Inter-American Bank and Sanz
Santa Maria of CIAP), I made no comment and waited for Gallo to air
these views elsewhere, as he promptly did to anyone innocent enough
to listen.
16. Education Minister Pacheco told Richardson at lunch how the
Popular Unity forces were moving into the University of Chile Law
School and how they were setting up new structures that would force
out dissenters in the faculty. We are getting many similar reports from
the education sector.
17. Frei was at his best. He is calm and cool. He believes he has a
one in twenty chance (I suggested to him one in five) and that he cannot
afford, as he said, to be anything but the President of all Chileans at this
time. The implication was clear that if the right messages could quickly
be brought to the Chilean public that is daily hearing from fewer and
fewer sources of straight news, the climate might shift to permit Frei a
more open role of challenge to Allende. Without such a climate, he
thinks Allende will be it. To my Frei-trained ear, he is also thinking of
how to worsen the economic situation in Chile quickly without hurting
the country over the longer-term. While it was true that his analysis tal-
lied exactly with my own, as Richardson told him, it is nonetheless im-
portant that Frei wanted to say it himself and to get it through to Presi-
dent Nixon.
Korry
378-376/428-S/80023
228 Foreign Relations, 19691976, Volume XXI
82. Transcript of a Telephone Conversation Between President
Nixon and the Presidents Assistant for National Security
Affairs (Kissinger)
1
Washington, September 12, 1970, 12:32 p.m.
[Omitted here is discussion unrelated to Chile.]
[K:] The big problem today is Chile.
P: Their stock market went to hell.
K: I had a call last night from McCone and Kendall this morning.
McCone thinks it would be a catastrophe if we let it go. Latin American
Bureau at State is against doing anything. Korry has stopped all ap-
pointments unless they come to him.
P: Did I see those instructions? I want to see them.
K: They came over here and one of my staff members agreed to it.
P: I am following it and I want a personal note to State that I want
to see all cables to Chile.
K: Maybe I should send a backchannel to Korry saying you are in-
terested in keeping it open.
P: By all means. I want an appraisal of what the options are. The
options are having another run-off election.
K: Helms has sent someone down for a first hand look to give their
appraisal.
P: Does State want to give them aid?
K: Let Alicande [Alessandri] come in and see what we can work out
and work out opposition to him.
P: Like against Castro? Like in Czech.? The same people said the
same thing. Dont let them do that. Meyer knows better. Tell Kendall to
call Meyer.
K: I did and he is beside himself. Augustin Edwards has escaped
and is coming here Monday. I am going to meet with him on Monday
for his feel of the situation.
2
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 364,
Telephone Conversations, Chronological File. No classification marking.
2
Kissinger met with Kendall and Edwards for an 8 a.m. breakfast meeting on
Monday, September 14. (Library of Congress, Manuscript Division, Kissinger Papers,
Box 438, Miscellany, 19681976, Record of Schedule) No other record of this meeting has
been found.
378-376/428-S/80023
September 5November 4, 1970 229
P: We dont want a big story leaking out that we are trying to over-
throw the Govt. We want his judgement on the possibility of a run-off
election.
K: I will do that. Thats essential.
P: Its going to hell so fast. Their stock market is down 50%.
K: Korry sent in a cable today that said while you meet in com-
mittees [omission is in the original]
P: Korry may have wanted to put us on the spot. He is a Kennedy
Democrat. Get a backchannel to him right away.
3
K: Exactly. We will have a meeting on Mon. The British Ambas-
sador called this morning and said he feels he must greet you at
Chequers. I know your preference but I said I would check with you
and get back to him.
P: Lunch there? We will do it.
K: I will call Freeman.
3
See footnote 2, Document 83.
83. Backchannel Message From the Ambassador to Chile (Korry)
to the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 14, 1970, 0403Z.
415. To: Henry Kissinger (for delivery prior to 0800 hours of 14
September). From: Ambassador Korry.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, 1970. Top Secret; Sensitive; Exclusively Eyes Only. A
note attached to the message reads, General Haig: Copies have been given to HAK and
you. Vaky copy is being held pending your approval. Haig wrote, No copy to Vaky.
However, Vaky most likely saw the message. A September 14 memorandumfrom Kissin-
ger to President Nixon summarizing Korrys backchannel message was sent under cover
of a September 17 memorandum from Vaky to Kissinger recommending that the memo-
randum from Kissinger to President Nixon be forwarded to the President. The Vaky
memorandum to Kissinger bears the notation, DRY [David R. Young, Jr.] hand carried
to AB [Alexander Butterfield] 9/18. There is no indication that the President saw
the memorandum from Kissinger. (Ibid., Box 774, Country Files, Latin America, Chile,
Vol. II)
378-376/428-S/80023
230 Foreign Relations, 19691976, Volume XXI
1. This responds to your message re Santiago 3462.
2
2. In the two messages sent through CAS channels Sept. 11 (San-
tiago 2844) and Sept 12 (Santiago 2850),
3
I provided the basic analysis
on which this message rests. Santiago 3462 said we were in a very fluid
situation and through State and CAS channels today, we reported fol-
lowing late developments of significance:
A. Freis message to the President via John Richardson and me
(Santiago 3644).
4
B. Freis message to Santiago Garrison commander Gen. Valen-
zuela and to CG of Carabineros that he intended to resign soon after
most patriotic of Chilean holidays (Sept 1819) to permit, by constitu-
tional methods, interim govt and new elections in which he would
stand.
5
C. Parallel move to have retired Gen. Viaux, leader of last Oc-
tobers army sitdown strike, issue anti-Communist declaration in few
days time.
D. Allendes speech to rally Sunday in which he threatened mass
take over of factories and farms by the people if his victory was
stolen.
E. Plans to make of the big military parade Sept 19th a tremendous
anti-Communist rally for Frei.
F. Formation of a joint Alessandri-Frei cum PDC covert propa-
ganda mechanism to inflate Frei and to stiffen backbones of media per-
sonnel opposed to Communist takeover.
3. I confess that prior to Secretarys message to me
6
I have encour-
aged in all prudent ways possible, without risking Presidents prestige,
these above measures. I have also sought to arrange the following:
A. To have the GOC accept Allendes request to seek to calm the
panic that is profoundly affecting the economy by having much re-
spected MinFinance go to nation by radio and TV ostensibly to calm
2
Document 80. Message WH 1783, September 12, reads as follows: The President
has read your Santiago 3642 and would like to have for his eyes only your views as to the
feasible courses of action available to the US in the present circumstances. You are, of
course, free to contact any persons you feel are necessary in order to collect required in-
formation. Please reply via this channel by 0800 Washington time Monday, September
14. (National Archives, Nixon Presidential Materials, NSC Files, Box 423, Backchannel,
EuropeMideastLatin America, 1970) Kissinger also noted in message WH 1777, Sep-
tember 12, to Korry, The President has asked that I inform you that he has been im-
pressed by your perceptive reporting during recent difficult days. He is very appreciative
of your efforts. Best regards. (Ibid.)
3
See Documents 78 and 79.
4
Document 81.
5
See Document 85.
6
Not found.
378-376/428-S/80023
September 5November 4, 1970 231
people and then recite the horrendous details that are affecting the
country, the point being to create the most serious doubts among the
masses that supported Allende and to force the Christian Democrats
into serious reflection.
B. To have the Church in some form provide support to Frei. I be-
lieve that the solemn Te Deum in the cathedral Sept 18th will include an
address by a respected prelate that will bolster the Frei position.
C. To have the Armed Forces gently rpt gently reminded that US
laws would under certain conditions be automatically invoked by Al-
lende govt actions and would lead to total ban on US arms and spare
parts sales, thus leaving Chileans defenseless.
D. To have the Christian Democrats and rpt and the Allende camp
reminded that almost all of Chilean industry, which is incomparably
larger and more complex than Cubas, is dependent on U.S. tech-
nology, U.S. credits, U.S. machinery.
4. The point of my efforts is to seek a position that at best helps Frei
in the constitutional play to stop Allende and at the same time im-
proves our (and PDC) bargaining position with an Allende govt if that
is what we shall have to confront. The focus of the pressure is both on
the masses and the Christian Democrats, a good many of whom are ei-
ther ready to rationalize an Allende govt or are so terrorized that they
fear for their lives if they oppose his accession. Hence at the minimum I
want to increase their bargaining demands; at the maximum I want
them to support Frei.
5. I have had to speak with many voices including a semi-public
one that is calm, cool and above-it-all. I wanted the US press to report
the USG was out of it; they have unanimously done so. I wanted the US
business reps to report that my advice was total non-intervention, some
disappointment with the election results and business-as-usual; they
have done so. I wanted the leaky bureaucracy in Washington to spread
the same word and thus keep our true options open. Unfortunately this
last effort has been so successful that the Dept failed to forestall the
statements of Inter-American Bank President Herrera in Washington
and of OAS SecGen Galo Plaza in Vina del Mar and of Latin govts
which have served to rule out the constitutional process by accepting
Allende as President. The statement of the man responsible for Galo
Plazas accession to the OAS post, Sol Linowitz, as extensively cited by
Allende today, is proof of what I mean: Linowitz is responsive if han-
dled correctly. He can correct the impression he has given here.
6. Frei is absolutely correct in wanting the US to say nothing and to
do nothing overtly that would make his task harder by converting a
constitutional process to defense of US interests. That does not mean
that he or I want US to act as if we believe we are impotent. Like my
German colleague, I believe it essential that we upend this Soviet tri-
378-376/428-S/80023
232 Foreign Relations, 19691976, Volume XXI
umph, that we not advertise to Latin America and to the world that our
own backyard is an open hunting ground. If we can defeat Allende,
and if a man such as Frei is the instrumentality, it can only serve our
purposes in the region and in the world.
7. Terror is the key weapon now being employed by the Allende
forces. But there is a counter-terror weaponthe economy, the condi-
tion of the Armed Forces and, as I have suggested to the key Frei men,
direct action against the mechanism that trumpets civil war. Frei
must be prepared, as I have told him indirectly, to use blackmail to
counter blackmail, to take out every skeleton in the crowded Christian
Democrat closet to produce converts among his Congressmen, to be
prepared at the opportune moment to have the Carabineros detain the
leaderships of the Communist and Socialist Parties, to frighten the hell
out of his Armed Forces and to panic the country into more dire eco-
nomic circumstances.
8. Frei is half-Swiss and he is extremely cautious. He likes his
ducks in a complete row. Hence the separate visits to me Friday night
of MinDefense Ossa, Senate President Pablo, and the most brilliant or-
ganizer in Chile, Raul Saez, were designed by Frei for them to hear my
views so as to remove any doubts. He then arranged for the next day
the private talk with Richardson and myself. Now he has gone to the
Army and the Carabineros, choosing the Army General to whom last
Sunday I delivered a very prudent message of encouragement.
7
9. I am not certain that Frei really means to resign as he told the
two generals. I think he may be engaging in counter-terror of a sort. He
knows that Allende is seeking to seduce the Armed Forces with every
kind of promise; he knows that that fool Tomic and his colleagues be-
lieve in Communist guarantees to the Armed Forces; he knows that Al-
lende has supporters in the Armed Forces. He may well be stirring the
pot to stop any recognition by the Armed Forces of Allende (who is ac-
tively seeking it and from Viaux too) and to keep them in the constitu-
tional line that he knows is their overwhelming preference.
10. In these circumstances, these are my action recommendations:
A. An immediate effort that involves both clandestine and back-
ground efforts to have published, particularly in the European re-
spected press, stories about the precipitous Communist take over al-
ready of the media, of the universities and of many key elements in the
society.
B. A similar effort re the economic situation and the consequences.
C. A similar effort but restricted to select publications re the de-
pendence of the Chilean Armed Forces on US supplies.
7
September 6. See Document 65.
378-376/428-S/80023
September 5November 4, 1970 233
D. A specialist to write this material for dissemination to be sent
here immediately since no one aside from myself could do the actual
writing. He would work under my direction.
E. A deep background by a high, much respected official such as
you, for a very select and small group of US editors or publishers on the
facts here, based on the material that we are preparing most carefully
such briefing to be done by no later than Wednesday of this week.
F. An effort by the White House to persuade the US carrier, Braniff,
and as many scheduled Latin and European airlines to make prepara-
tion now to have extra flights from Santiago to Buenos Aires for the pe-
riod Oct 24th to Nov 3rd so that those many Chileans who are willing
to make a fight for their country can be soon assured they will have a
way out if Allende is to be President.
G. Dispositions as may be possible to permit me to assure those
key Chileans who need such assurance that they will be able to enter
the US if this effort fails.
H. An immediate effort with Gen. Lanusse of Argentina, currently
in the US, to have the Argentine Govt remain quiet and uninvolved but
to have that govt allocate publicly extra funds to handle the flood of
Chileans who might leave the country next monththe point being to
keep influential groups here to fight the battle but with the knowledge
that if they have to leave everything behind at the last moment, they
will receive lodging, food, etc.
I. Funds to handle covert support of the new pro-Frei propaganda
mechanism and to fund some essential players in the game. A standby-
fund for suborning of Congressmen should also be set aside now.
J. The Department support my position that in the circumstances
there can be no rpt no disbursement of A.I.D. funds in the pipeline
unless specifically recommended by me and that with a threat of civil
war, it would be imprudent to permit any A.I.D. new personnel or con-
tractors to come to Chile unless as specifically recommended by me.
11. Finally, I must express my concern that there seems to be a lack
of complete understanding between the Department and myself as to
the basic US policy line in this situation. I hope that the deliberations
now underway will result in a clear policy line and unambiguous sup-
port for this Embassy in its efforts to forestall or at least mitigate what
could be a serious defeat for the United States. I may add that this Mis-
sion in all its elements is in complete agreement and working harmoni-
ously to support the policy that I have recommended.
12. I wish you to know of my most profound gratitude for the Pres-
idents message and for the support he has always provided. It has
been indispensable and essential; it is deeply appreciated. With warm
regards.
378-376/428-S/80023
234 Foreign Relations, 19691976, Volume XXI
84. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 14, 1970.
SUBJECT
U.S. Aid to Chile
You requested information regarding the amount of assistance we
have provided to Chile as compared to other major Latin American
countries.
Since July 1961, the beginning of the first fiscal year under the For-
eign Assistance Act, the U.S. has provided a total of $1.2 billion in for-
eign assistance to Chile. Of this total, $564 million was in AID loans and
grants. The remainder consisted of PL 480, Exim Bank loans and mili-
tary and other economic assistance. During this period Chile was the
second largest Latin American recipient of U.S. foreign assistance
(Brazil received $2.3 billion).
In FY 1970, Chile received $41.1 million and the level of aid tenta-
tively projected by the agencies for FY 1971 is $71.6 million. Foreign aid
legislation for FY 1971 has not yet been passed, and the FY 1971 pro-
jected level is, of course, subject to change.
Attached for your information at Tab A is a table which provides a
summary and breakdown of our assistance to Chile compared with
that given to other major Latin American countries during the same
time period. The table at Tab B summarizes U.S. assistance provided to
Chile in FY 1970 and estimated in FY 1971.
2
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Confidential. Sent for information. This
memorandum was written in response to a September 8 memorandum from John Brown
of the Office of the Staff Secretary. (Ibid.)
2
Both are attached but not printed.
378-376/428-S/80023
September 5November 4, 1970 235
85. Backchannel Message From the Ambassador to Chile (Korry)
to the 40 Committee
1
Santiago, September 14, 1970.
1. The following information was given to the [less than 1 line not
declassified] Ambassador [less than 1 line not declassified]. The Ambas-
sador wishes that it be included in the 40 Committee deliberations.
2. [3 lines not declassified] the previous day to speak with President
Frei. The message from Frei was that he could not afford to wait until
October 24th to move against Salvador Allende. Frei admitted he has
been amazed by the speed and extent of the moves being made by the
Popular Unity forces to consolidate their position. Frei told the two
generals he has decided that he will resign after the National Day cele-
brations (September 1819) leaving the next in line, Senate President
Tomas Pablo, as the interim president until new elections can be called.
3. [1 line not declassified] Pablo is to name a military cabinet except
for two positions which Frei has specifically asked be filled by their
present incumbentsMinister of Economy Carlos Figueroa and one
other [less than 1 line not declassified]. It is Freis hope that under Pablo
and a military cabinet steps can be taken to neutralize the Communist
Party. After the country is cleaned up, Frei said he would accept to run
as candidate for the presidency in new elections.
4. Valenzuela gave the impression that among the generals who
will support Frei in the above plan, the strongest person is [name not de-
classified]. As Frei put it, Schneider has constitutionalism sickness
and is therefore a problem.
5. President Frei is undoubtedly aware of the Embassys contact
[name not declassified] which had been alluded to earlier by me in my re-
cent talk with Sergio Ossa, Minister of Defense.
2
6. As to the accuracy of the above information, no one can judge. It
was quite clear and in keeping with his close personal friendship [less
than 1 line not declassified] appeared [less than 1 line not declassified] as
sincere in what he reported and willing to help in the above plan as pre-
sented to him by Frei.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only.
2
See Document 79.
378-376/428-S/80023
236 Foreign Relations, 19691976, Volume XXI
86. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 14, 1970.
SUBJECT
Chile40 Committee Meeting, MondaySeptember 14
Attached is the CIA paper prepared as the basic document to be
considered. You should read it carefully, especially Section I, pp 28,
outlining the significant new developments that have occurred.
2
This
memo summarizes the CIA paper, provides analytical comment and
my conclusions.
I. Summary of the Paper
A. The setting the paper describes includes these major elements:
1. Military action is impossible; the military is incapable and un-
willing to seize power. We have no capability to motivate or instigate a
coup.
2. Because of significant changes in circumstances, a political plan which
Frei has contrived has some chance of success. It is still a very long shot, but
it is the only possibility.
3. The plan involves an effort to corral enough PDC, Radical votes to elect
Alessandri; he would then resign; a new election would be required;
Frei would be eligible this time and would run; presumably he would
be elected. The process is constitutional and legal, if unusual and
untraditional.
4. The unqualified support and effort of Frei is central to this plan be-
cause moving the majority of the PDC congressional bloc to Alessandri
is the essence of the maneuver. The attraction to the PDC is another six
years of political power. Frei has taken the necessary preliminary steps
to position the PDC and himself for such an effort.
5. The U.S. cannot operate this plan; it must be Chilean and Freis. Our
support and stimulus may be critical, and resources may become im-
portant. But in essence we would be backstopping a Chilean effort.
6. Korry has in fact already encouraged and pushed this plan, if he did
not participate in its creation. He has already committed us to at least
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. Sent for action.
2
The memorandum, Review of Political and Military Options in Chilean Electoral
Situation, is attached but not printed.
378-376/428-S/80023
September 5November 4, 1970 237
moral support and encouragement. Therefore, the issue is not whether
we go or do not go; but whether we continue this encouragement and
do any more, or draw back.
B. The possible courses of action to support and stimulate the Frei
re-election gambit are described as:
1. Authorize the Ambassador to encourage the gambit through
whatever resources are available to him locally, but on the most dis-
creet basis to minimize exposure of USGs role.
2. Authorize the Ambassador to assure Frei directly that the USG
strongly supports and encourages his efforts. This might include an
oral message from President Nixon to be used if appropriate.
3. Parallel Ambassadors efforts with outside support to influence
Freistimulate foreign political figures whom Frei respects to en-
courage him.
4. Work through European Christian Democratic parties to bolster
Freis leadership and encourage the PDC leaders to contest Allende.
5. Encourage the Radical Party, through established assets, to
abandon Allende in favor of Alessandri.
6. Generally keep information lines into the military and close
communication to be prepared for any future eventuality.
The risks of exposure are appreciable, and rise the broader our in-
volvement and contacts.
C. The paper asks the Committee to address the following questions:
1. Should the Ambassador be authorized to continue to encourage
and support the Frei plan but with as little risk of exposure as possible?
If so, should he be provided with a confidential message of support
from President Nixon to Frei to use at the appropriate time?
2. Should his efforts be complemented through outside diplomatic
and covert activities designed to encourage Frei? Should a propaganda
campaign be conducted outside Chile in support of the Frei gambit?
3. Should an effort be made to swing Radical votes to Alessandri?
Should the German Democratic Socialist Party which has close ties be
encouraged to weigh in with the Radical Party in this sense?
4. Should we expand and intensify military contacts to be assured
of requisite intelligence and stand-by channels of influence?
II. Analysis
The description of events and the proposals must be examined
through the following questions:
What are the chances of success?
378-376/428-S/80023
238 Foreign Relations, 19691976, Volume XXI
What element would USG involvement provide that would not
otherwise be there and what difference would it make?
What are the consequences of success, and the consequences of
failure?
What are the dangers to the US in getting involved?
Why should we run these risks and incur these costs at all? Is it
really necessary?
Without long narrative, I think a fair analysis would have to say:
1. Chances of Success. Frei says one in twenty; Korry says one in five.
No one really knows with much precision, but it is clear that the
chances of success are considerably less than even.
2. What does USG involvement add? Probably a great deal in terms of
moral support and encouragement. Now that we have already begun
this, to quit would almost surely kill the effort. It may not be able to
continue without our support. There is less evidence that any material
resources would be needed, but some money may be.
3. The consequences of success. It is vital to understand that it is not
just a question of defeating Allende and thats it. This sets in motion a
number of serious problems:
If Allende is defeated in the run-off, he and his supporters are most
likely to go to the streets. Widespread violence and even insurrection is
a possibility. He is unlikely to simply meekly run in a new election.
If there is a new election, we would want to make sure Frei wins;
hence we would be drawn into further action to support his election.
If Frei is elected, his would be an unstable government facing se-
rious dissension. Such a situation would probably require massive US
economic and military assistance support.
4. The consequences of failure. If the gambit fails it will discredit the
parties and the democratic institutions. It will give the Communists the
excuse to push Allende quickly into a radical course. The restraints that
would have been available to slow down or modify his actions would
be gone. Failure would in short guarantee a fate that may not have been
inevitable.
5. Dangers to the US. The biggest danger is exposure of US involve-
ment. This would wreck our credibility, solidify anti-U.S. sentiment in
Chile in a permanent way, create an adverse reaction in the rest of Latin
America and the world and perhaps domestically. Exposure of US in-
volvement with an effort that failed would be disastrous; it would be
this Administrations Bay of Pigs.
A second major danger is that while we might begin with a limited
plan of encouragement, this is a slippery slope; we may very well find
ourselves irresistibly sucked into rising degrees of involvement at
rising risks to protect the investment and find ourselves having
slipped into a disastrous situation.
378-376/428-S/80023
September 5November 4, 1970 239
6. Why the need for USG involvement. This is the crux of the issue. Do
the dangers and risks of an Allende government coming to power out-
weigh the dangers and risks of the probable chain of events we would
set in motion by our involvement?
What we propose is patently a violation of our own principles and
policy tenets. Moralism aside, this has practical operational conse-
quences. Are they rhetoric or do they have meaning? If these principles
have any meaning, we normally depart from them only to meet the
gravest threat to us, e.g., to our survival.
Is Allende a mortal threat to the US? It is hard to argue this. Is he a
serious problem that would cost us a great deal? Certainly. Is it inevi-
table that he will consolidate his power? He has a very good chance;
but it is far from inevitable or that if he does that he will be a success.
Does an Allende government start a South American dominoes? Un-
likely; the impact of a Marxist state in the rest of Latin America is
containable.
III. Conclusions
I conclude that:
1. Any covert effort to stimulate a military take-over is a non-starter.
There is no practical possibility at this point.
2. We should keep our lines open and broadened into the military.
An opportunity may open up later; but for the moment we should
gather information and establish standby channels.
3. Korry has already started us on a political track. We cannot
backtrack without killing the Frei plan.
4. The Frei plan has some chance, and it is the only chance.
5. Our support can be important to its success.
6. It is possible to backstop it at this point with a minimum involve-
ment and with acceptable risks.
7. But there are limits to what we can do acceptably. It is not a ques-
tion of just adding more effort and money. Our capacity to succeed is
simply not a function of how much effort we put in, and the greater our
involvement the sharper the danger of exposure.
8. We should therefore enter into this in the knowledge that the
calculus can change to make it wiser to cut out rather than just progres-
sively be sucked into massive and disastrous involvement to protect
the investment.
9. We should also understand that this is not a limited operation. If
it succeeds it opens up still more serious problems as outlined above.
We are almost sure to be called upon for continued support of one kind
or another for years, (See II 3 above) and success of the plan will almost
surely trigger violence in Chile.
378-376/428-S/80023
240 Foreign Relations, 19691976, Volume XXI
10. I would recommend the following:
a. Authorize the Ambassador to continue to encourage Frei to use
resources at his command, but with the utmost discretion and tact and
with absolute minimum USG involvement. (I would not authorize a
personal message from President Nixon; we should protect the
President.)
b. Organize efforts from the outside, i.e.
encourage European Christian Democrats to funnel support, en-
couragement and ideas; perhaps even funds.
encourage other leaders to do so.
develop an outside propaganda campaign as Frei suggested.
c. Develop an internal propaganda campaign to stir fear of a Com-
munist take-over, and expose Communist machinations.
d. Use our separate assets to work on the Radical Party; try to get
the German Social Democrat Party to do the same.
e. Ask for weekly reports and establish some mechanism to mon-
itor this carefully.
87. Memorandum From Winston Lord of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 14, 1970.
SUBJECT
Chile, Vietnam, and Elections
There are many powerful arguments against U.S. meddling in the
Chilean internal scene to thwart an Allende victory in the congressional
run-off. With most of these you are undoubtedly thoroughly familiar
the risk of exposure and the damage to our policy throughout Latin
America, doubts whether effective actions are possible, the general re-
pugnance of our trying to arrange the political structure of another
country, etc.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, 1970. Secret; Sensitive; Eyes Only. Sent for informa-
tion. A copy was sent to Haig.
378-376/428-S/80023
September 5November 4, 1970 241
There is however another compelling reason against our interfer-
ence, which you may not have fully focused on: It could completely un-
dercut our policy on Vietnam.
Revelation of our directly moving to reverse the unpalatable elec-
toral outcome in Chile would make a mockery of our stance on South
Vietnam, would make hollow the following tenets of our policy:
We are for self-determination of the South Vietnamese people
without foreign interference;
We think this can best be accomplished through free elections;
We will abide by the outcome of elections, even if this means Com-
munist influence or control.
It would be most difficult to sit across the table from the North
Vietnamese and assure them that we are not trying to trick them
through elections while the newspapers are describing U.S. attempts to
thwart the outcome of the electoral process in Chile, a country where
we have not lost some 50,000 American lives.
It would mercilessly expose our Vietnam policy of self-
determination, elections, and acceptance of the political outcome to at-
tacks not only by American doves, but also by middle-of-the-roaders.
And it would signal to the present South Vietnamese government that
they need not take us seriously when we press them for political
compromises.
As for the argument that Allende only won about 38 percent of
the electoral vote, this proportion is almost precisely what ThieuKy
received.
88. Transcript of a Telephone Conversation Between Secretary of
State Rogers and the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 14, 1970, 12:15 p.m.
[Omitted here is discussion unrelated to Chile.]
R: Okay. On Chile, CIA has prepared a paper
2
with general conclu-
sions which I think are pretty goodour people agree. But whatever
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 364,
Telephone Conversations, Chronological File. All blank underscores are omissions in the
original
2
Rogers is apparently referring to Situation Following the Chilean Presidential
Election, dated September 7. The memorandum is Document 18 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
242 Foreign Relations, 19691976, Volume XXI
we do, I think there are two things we should take into consideration:
one, we want to be sure the paper record doesnt look bad. No matter
what we do it will probably end up dismal. So our paper work should
be done carefully. I hope there arent any CIA backchannels we dont
know about. I talked with the President at length about it.
3
My
feelingand I think it coincides with the Presidentsis that we ought
to encourage a different result from the but should do so dis-
creetly so that it doesnt backfire.
K: The only question is how one defines backfire.
R: Getting caught doing something. After all weve said about elec-
tions, if the first time a Communist wins the U.S. tries to prevent the
constitutional process from coming into play we will look very bad.
K: The Presidents view is to do the maximum possible to prevent
an Allende takeover, but through Chilean sources and with a low
posture.
R: I have been disturbed by Korrys telegrams. They sound frenetic
and somewhat irrational. I know that hes under pressure but we ought
to be careful of him. Hes got tender nerve ends. I dont know if you
saw his telegrams.
K: Yes, I did.
R: And I think weve got to be sure he acts with discretion. Hes a
high-strung fellow.
K: I think what we have to do is make a cold-blooded assessment,
get a course of action this week some time and then get it done.
R: I talked to John E . I think its important that he un-
derstand that what hes doing is not his doing but encouraging the
Chileans to do what they should. If its our project as distinguished
from Chilean its going to be bad from [for?] us. Im not sure hes the
best man to do it. Im not sure hes the most discreet fellow. But we
want to be sure CIA is not dealing with him through backchannels.
K: Is it?
R: Not that I know of right now. We ought, as you say, to
cold-bloodedly decide what to do and then do it.
3
According to the Presidents Daily Diary, Rogers called Nixon at 1:48 p.m. on Sep-
tember 13. The two men talked until 2:16. No substantive record of the conversation has
been found. (National Archives, Nixon Presidential Materials, White House Central
Files, Presidents Daily Diary)
378-376/428-S/80023
September 5November 4, 1970 243
89. Memorandum for the Record
1
Washington, September 14, 1970.
SUBJECT
Discussion of Chilean Political Situation
PARTICIPANTS
Richard Helms, Director of CIA
Donald Kendall, President of Pepsi Cola
Agustin Edwards, Owner (Publisher) of El Mercurio and a chain of other
independent Chilean daily newspapers, as well as banks and important
agricultural and business enterprises
[name not declassified]
[Background
The Chilean presidential election was held on 4 September 1970.
Socialist Senator Salvador Allende, the candidate of the Popular Unity
(UP)a coalition of the pro-Cuban Socialist Party (PS), the Communist
Party (PCCh), the leftist-led Radical Party (PR) and other small leftist
groupswon a plurality (36.3%) of the votes cast in a three-way race.
Jorge Alessandri, independent candidate of the center right, including
the National Party (PN), was generally expected to come in first, but
was a close second with 35%. Radomiro Tomic, candidate of the Chris-
tian Democratic Party (PDC), came in third with 27.8%.
The Chilean constitution requires that because no candidate re-
ceived a majority of the votes cast, the Congress will meet on 24 Oc-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 1970. Secret; Sensitive; Eyes Only. Drafted by Millian.
Although the meeting took place on September 14, the memorandum was drafted and
sent to Kissinger on September 18 with a note from Helms that reads: Here is a write-up
of the talk we had with Mr. Edwards from Santiago. Further conversations and a more
exhaustive debriefing are going on with Mr. Edwards right now. The only other record
of the meeting with Edwards, reporting a series of conversations held on September 15
and dated the following day, provides no substantive information regarding the discus-
sion other than the meeting went well. (Central Intelligence Agency, Job 80B01086A,
DCI Eyes Only File, 1970)
The background for these meetings is discussed briefly by Kissinger in The White
House Years, p. 673, and by Thomas Powers in his biography of Richard Helms, The Man
Who Kept the Secrets, p. 228. In his congressional testimony, Helms recalled that prior to
this meeting [with the President (described in Document 93)] the editor of El Mercurio
had come to Washington and I had been asked to go and talk to him at one of the hotels
here, this having been arranged through Don Kendall, the head of the Pepsi Cola Com-
pany . . . I have this impression that the President called this meeting where I have my
handwritten notes because of Edwards presence in Washington and what he heard from
Kendall about what Edwards was saying about conditions in Chile and what was hap-
pening there. (Alleged Assassination Plots, p. 228, footnote 1) [Ellipses are in the original
footnote.]
378-376/428-S/80023
244 Foreign Relations, 19691976, Volume XXI
tober to elect a president from the two top vote-getters. The Congress
has selected the top vote-getter on the three occasions in this century
when no candidate received the required majority. Alessandri has said
publicly that if Congress elects him president he will resign, thereby
forcing a new presidential election in which he would not be a candi-
date. Tomic, the Christian Democratic candidate, has publicly recog-
nized Allendes victory. Outgoing President Eduardo Frei, a Christian
Democrat who was not eligible to run on 4 September, would qualify in
a new election if Alessandri were elected by the Congress and then re-
signed. Frei has said that constitutionally he cannot recognize anyone
as president until after the Congress has voted. At present the PDC
holds the 75 swing votes in Congress.]
2
On 14 September Mr. Kendall and Mr. Helms met with Agustin
Edwards, owner of the independent newspaper El Mercurio, [less than 1
line not declassified]. Mr. Helms attended the meeting at the request of
Dr. Henry Kissinger who, with Mr. John Mitchell, the Attorney Gen-
eral, had met earlier with Mr. Kendall and Mr. Edwards. Mr. Edwards,
who had left Chile on 10 September and arrived in the United States on
13 September stopping in Argentina, expressed the following views on
the Chilean political situation:
a. Reason for Alessandris Loss
The abstention figure was 16%, indicating that the Alessandri
forces had failed to get out the precinct vote. Women voters probably
comprised the bulk of the 5% increase over the 1964 abstention figure.
Edwards said that it was too bad that we could not have been allowed
to take votes away from Tomic. This was a reference to the U.S. Gov-
ernment caveat which limited Edwards efforts on our behalf to an
anti-Allende campaign with no direct support to Alessandri.
b. Possibility of Constitutional Solution
On election night, Frei, after allowing Allende to have a victory pa-
rade, heard of Alessandris plan to try to win the presidency on 24 Oc-
tober and then step down in favor of a new election which would prob-
ably find Frei opposing Allende. Frei sent Bernardo Leighton, an
influential Christian Democrat national deputy as his emissary to Ales-
sandri. Their discussions resulted in Alessandris statement issued sev-
eral days later (9 September) that he was not conceding to Allende and
that he would resign if elected by the Congress. The chances of Ales-
sandris being named president are slim. Allende needs at most only 18
additional Congressional votes to secure his victory in the full
Congress of 200. Alessandri, on the other hand, needs to attract 58
votes, most of them from the PDC. Frei is scared blue of Allendes
2
Brackets are in the original.
378-376/428-S/80023
September 5November 4, 1970 245
coming to power, but he can only count on 20 PDC Congressmen to
vote for Alessandri. Edwards has heard that some people may be get-
ting scared. The Communists are circulating blacklists with the names
of PDC bureaucrats. These blacklists may boomerang against the Com-
munists to the extent that PDC Congressmen who were neutral or in-
clined to vote for Allende may decide to vote for Alessandri.
The Congressional route to prevent Allende from coming to
power, while remote, should not be ignored, but it entails the following
risks:
1) It might not work, and then what? (The new president takes of-
fice on 4 November.)
2) Some Congressmen might move too soon or announce their in-
tention prematurely, thereby triggering the Communists to move into
the streets.
3) Retired General Roberto Viaux, leader of the military dissension
of October 1969, [1 lines not declassified] or some other nut might try
to stage a coup, thereby precluding any serious effort. (Comment: Viaux,
in October 1969, led a 24-hour rebellion of the Tacna Artillery Regiment
in Santiago to express military dissatisfaction with its poor pay and
equipment. The rebellion ended without bloodshed when the gov-
ernment promised to meet some of Viauxs demands. Viaux had wide-
spread moral support because of overall dissatisfaction in the military.
He was convicted of military rebellion and eventually placed on pa-
role. At present he does not appear to have substantial support among
active duty military personnel.)
c. Timing for Possible Military Action
By mid-October after the PDC Congress, it should be clear what
will happen on 24 October in the Congress. Edwards asked: Can we
run the risk that the Alessandri/Frei plan will work?
d. Carabineros (National Police)
[name not declassified] believes that the Carabineros, particularly
their commandant, General Vicente Huerta, want to do something to
prevent an Allende presidency, but they cannot do it alone. [3 lines not
declassified] The Carabineros, a well formed and disciplined force of
24,000, [2 lines not declassified].
e. Navy
14,000 (145 in the Naval Air Force and 2,200 in the Marines) largely
based at the port of Valparaiso, an elite service. Edwards described
Rear Admiral Fernando Porta, Commander-in-Chief of the Navy, who
opposes Allende, as indecisive and overly cautious. [1 line not declassi-
fied] Porta, who took a stance similar to that of General Rene Schneider,
Army Commander-in Chief, to the effect that the military would sup-
port the constitution. At that time it was expected that Alessandri
378-376/428-S/80023
246 Foreign Relations, 19691976, Volume XXI
would win a plurality but not a majority and the Congress would elect
Allende. Of 11 Navy admirals, eight are anti-Allende and three are
pro-Tomic, including Rear Admiral Luis Urzua Merino, Commander
of the Marine Corps. [3 lines not declassified] the Navy enlisted men
would be much more reliable than those in the other services. Allendes
political forces, however, had been able to shift the votes of some of the
wives of the Navy enlisted men by promising them that if Allende be-
came president, enlisted men could move up to become officers.
Captain Carlos Le May Delano, Deputy Chief of the Navy General
Staff and the most intelligent man in the Navy, [less than 1 line not declas-
sified], has considerable influence on Porta but is a staff man, not a troop
commander. Le May felt that manipulation of the Navy fuel supply for
its small fleet might have some effect in pressuring the Navy to act, but
alone it would be ineffective. (Le May studied electronics at Monterrey
and was once an alcoholic.)
f. Air Force
9,720,490 of them pilots, with 227 aircraft, 60 of them jet-powered.
General Carlos Guerraty, Commander of the Air Force, wants to
act against Allende, but Guerraty is not very intelligent and his imme-
diate deputy, General Cesar Ruiz, Chief of Staff, is doubtful. [name
not declassified] did not see any significant role for the Air Force and
noted that it was incompetent and poorly equipped.
g. Army
23,000 in six understrength, inadequately equipped divisions.
The Army is quite divided, partly because of the Viaux episode.
Before the election [name not declassified] went to see Alessandri to alert
him that there was too much talk of a coup in the event Allende won
the election. He said the organization should be tightened up and either
Viaux or the military chiefs should decide which group should lead the
coup.
[name not declassified] said that the key to a coup would be to get
General Carlos Prats, Chief of the National Defense Staff, to move,
which would involve neutralizing Schneider, the Commander-in-Chief
of the Army. [name not declassified] has considerable respect for Prats
[less than 1 line not declassified] Prats was Army Attache to Buenos Aires
three years ago.
[name not declassified] has been able to contact General Camilo Val-
enzuela, Commander of the Santiago Garrison who, during elections or
under a state of siege, takes command of all troops in the Santiago area,
including the Carabineros, but usually, as now, has no troops under his
direct command. Valenzuela has agreed to cooperate with the military
chiefs. [name not declassified] described Valenzuela as tough, well-
mannered, and honest. Valenzuela said that, if necessary, he would go
378-376/428-S/80023
September 5November 4, 1970 247
it alone and would support General Prats for Commander-in-Chief if
Schneider could be given an honorable way out.
After the election, the only significant military contact [name not de-
classified] had was with Valenzuela. [name not declassified] lost some of
his respect for Valenzuelas capabilityhowever, when he asked [name
not declassified] to check on the reliability of General Orlando Urbina,
Commander of the Second Army and Valenzuelas direct subordinate.
It seems that Urbina has a relative who is an advisor to Allende.
[name not declassified] said the Army is concerned about the reli-
ability of non-commissioned officers (NCO), particularly those in the
NCO School. He added, however, that he believed Viaux could neu-
tralize them. A danger, [name not declassified] believes, is that some ju-
nior officer will crop up (probably in the Navy) and prematurely start
something on his own against Allende.
([less than 1 line not declassified] Chile produces limited quantities of
small arms and ammunition. It is dependent on the U.S. and Western
Europe for all categories of equipment including additional quantities
of types produced locally.)
[name not declassified] added that in discussing the post-election sit-
uation with Valenzuela and some of the key Naval officers they were
concerned with two basic points:
1) If the Chilean Government were overturned in a military action,
would the new government then installed receive diplomatic recogni-
tion from the U.S.?
2) Would the Chilean Armed Forces receive logistical support for
an action against the government? ([name not declassified] quoted Cap-
tain Le May as having said that saber rattling activities by Peru or Ar-
gentina against Allende could trigger a military move as would a deci-
sion by the U.S. Government to withhold aid.)
[less than 1 line not declassified]
[5 lines not declassified] The main worry of all those who might be
involved in a military action is the protection of their families and of
their followers should they decide to act against Allende.
Frei
[name not declassified] said that he was fond of the President as a
person but asked how many presidents would enjoy spending the
evening reading about Catholic influence on modern literature? He
described Frei as one who traditionally collapses under pressure. He
said [1 line not declassified] to his knowledge, Frei has never in his po-
litical history crossed a major rubicon. He cited as an example the elec-
tion of 1958 in which Frei ran third only because he failed to write a
letter asking for the proffered support of the Conservative Party. Ed-
378-376/428-S/80023
248 Foreign Relations, 19691976, Volume XXI
wards said Frei is indecisive, always balancing, always waiting for the
other guy to move.
United States/Chile
A key question in the average Chileans mind, according to [name
not declassified], is: Does the U.S. care? The eight-hour TV interview
given by Fidel Castro, which was played extensively in Chile prior to
the election, told the Chilean people not to worry about U.S. interven-
tion if Allende won since the present non-interventionist attitude in
the U.S. combined with pressure in the Near and Far Eastplus do-
mestic unrest in the U.S.would keep the U.S. neutralized.
In answer to the question on how an encouraging word could be
passed to the military, [name not declassified] said it would be disastrous
if it were delivered openly. If word of the U.S. attitude were delivered
discreetly, it might help.
In reviewing the present arrangement of forces on our side,
[name not declassified] noted that, as far as he knew, our State Depart-
ment was pressing the constitutional line while Ambassador Korry
was running around like a lunatic and would probably ignore the
State Department if he saw a way out. In any event, Frei would prob-
ably chicken out at the last minuteprobably deciding not to act on
little more than a phone call from a worrier.
Replying to a question as to whom [name not declassified] knew who
still had good contacts with the military, [name not declassified] said that
both Sergio Onofre Jarpa, President of the National Party (PN), and PN
Senator Francis Bulnes of the National Party could be helpful, but he
added that others in the Alessandri campaign were not really tuned in
properly. The best man, [9 lines not declassified].
[name not declassified] was somewhat emotional at times and fre-
quently rambled. He appeared to be seeking possible solutions but his
conversation did not indicate that he had yet found one that he consid-
ered feasible or effective.
[name not declassified]
378-376/428-S/80023
September 5November 4, 1970 249
90. Letter From John McCone to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Los Angeles, California, September 14, 1970.
Dear Henry:
As I told you on the telephone on Friday, I am deeply concerned
over developments in Chile. My concern stems from my experiences as
Director of the Central Intelligence Agency in 1964 as well as my recent
contact as a Director and member of the Executive Committee of Inter-
national Telephone and Telegraph Corporation. As you know, this
company owns and operates the Chilean telephone system and other
enterprises in that country. The book value of their investments is
about $150,000,000 against which they hold United States guarantees
(I believe through AID) totalling $95,000,000 to $100,000,000.
There is no question in my mind that Allende is a Marxist and his
announced policies of nationalizing most industry, communications,
etc. are dictated from outside of the country.
In June of 1964, three months before the election, Allende fielded
some 300 sound trucks and employed from 3,000 to 3,500 political
workers. This substantial effort was financed by $1,000,000 of United
States currency which reportedly came from Communist sources out-
side of the countrypresumably, Moscow.
American business interests became alarmed over the prospect of
Allende winning the election and offered to support Freis campaign,
volunteering a fund of $2,000,000. This, naturally, was refused but the
Agency, with the approval of the President, the Secretary of State and
the Secretary of Defense, gave assistance to the Frei campaign both by
guidance and financial support, the latter figure totally about [dollar
amount not declassified] if my memory serves me correctly.
The campaign was successful. Frei was the first man in recent
years to carry a clear majority, his vote exceeding 54% and his success
carried over to the subsequent congressional election when his party
won some 55% or 56% of the seats of their parliament.
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box CL108,
Geopolitical File, Chile, 330 Oct 1970. Personal and Confidential. McCone was Director
of the Central Intelligence Agency from 1961 to 1965 and was a member of the ITT board
of directors at the time this letter was written. Kissinger signed an October 7 reply pre-
pared by Vaky that reads, Thank you for your letter of September 14 on Chile. You may
be sure that we are all concerned about the situation. It is a difficult one, and I assure you
that the President is similarly concerned. I appreciate you sending me your thoughts and
I shall certainly keep them in mind. Perhaps when I return from Europe we can have a
chat. (Ibid.)
378-376/428-S/80023
250 Foreign Relations, 19691976, Volume XXI
I give you this background because I feel that we acted very wisely
in 1964 and while Frei as President took many actions inamicable to our
interests, nevertheless, his administration was always free of outside
influences.
The ITT officers and directors are deeply concerned over the future
of Chile if Allende is seated as President and they are also fearful that
his policies will extend to neighboring countries in Latin America, most
particularly, the Argentine, Brazil and Peru. Therefore, they feel that
anything that can be done between now and October 24th to prevent
Allende taking office as President should be done and ITT alone are
prepared to put up a minimum of $1,000,000 for this purpose.
Understandably, however, and consistent with their policy, they
will not engage in political action in Chile or in any other country
unless they are acting in concert with United States Government pol-
icies. Incidentally, representatives of the three neighboring states men-
tioned above have all contacted ITT urging some immediate action on
their part.
It is a disappointment to me that we did not take more aggressive
action prior to the election. However, it may not be too late and it is for
that reason I am writing expressing my concern and indicating the ex-
tent to which at least one company in the private sector is willing to go.
I know this is a sensitive subject and should you wish to discuss it
further, I am willing to come to Washington to meet with you and
others at your convenience and request. Please hold this letter in your
complete confidence.
Sincerely,
John
378-376/428-S/80023
September 5November 4, 1970 251
91. Memorandum From the Chief of Naval Operations
(Zumwalt) to the Chairman of the Joint Chiefs of Staff
(Moorer)
1
Washington, September 15, 1970.
SUBJ
Chile (U)
1. The final results of the recent election in Chile pose serious
problems for the United States. If the forthcoming meeting of the
Chilean Congress decides in favor of Salvador Allende, U.S. strategy
and policy could be threatened throughout the Western Hemisphere.
Accordingly, I desire to provide you with my views on this issue:
a. Quite apart from general concern over the penetration of a
Marxist-Leninist regime into the South American continent, I explicitly
disagree with any judgment that the U.S. has no vital strategic interest
which would be threatened by the establishment of an enlarged Soviet
presence in Chile.
b. I do agree that the caution which would characterize both sides
of the Chilean-Soviet relation would make unlikely the establishment
of Soviet military bases in the short run.
c. I believe that the odds are about even that this short run period
will take two years. By the middle of 1972 we could face a situation in
which:
(1) The Marxist-Leninist government of Chile had sufficiently
overcome opposition elements, including the military, that a deal with
the Soviet Union for an overt military presence became possible.
(2) The Soviet presence could by that time have proceeded to the
extensive use of Chilean territory for the geographically ideal support
of Soviet space and, more seriously, Fractional Orbit Bombardment
programs (with all that the latter portends for increased first strike
capability).
(3) The Soviets in Chile could by then risk the revelation of naval
and air bases in Chile and in the offshore islands.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 1970. Secret; Sensitive. An attached covering memo-
randumfrom Robinson to Kissinger indicates that Moorer provided Packard with a copy.
Zumwalt sent Moorer a draft of this memorandum on September 14, which noted that
policymakers favored a restrained, deliberate posture on Chile. Moreover, it took issue
with the CIA for the assessment that an enlarged Soviet presence would not threaten any
U.S. vital strategic interest. (The History of the Joint Chiefs of Staff, Volume X: The Joint Chiefs
of Staff and National Policy, 19691972, Historical Division Joint Chiefs of Staff, 1991,
p. 159)
378-376/428-S/80023
252 Foreign Relations, 19691976, Volume XXI
d. The acquisition of the Soviet Navy of bases along the 3,000 miles
of coastline from which to project Soviet power into the South Pacific
and Atlantic Oceans and into the South American continent, would re-
sult in a significant additional dimunition of U.S. power and a corre-
sponding increase in Soviet power. Because it would come about
slowly, this change would be less dramatic to the public than the Soviet
attempt to emplace missiles in Cuba, but would probably be even more
profound because it would represent conventional power, more us-
able, in a conventional struggle and for military-political purposes.
e. Although I evaluate the chances of the foregoing happening in
1972 as about even, I judge that the chances would increase closer to
unity by 1974.
f. The consequences of the foregoing are of such significance in
world politics and in the hemisphere, and the extent to which U.S.
forces would be required to reverse them later, so marked, that I be-
lieve they raise the threshold of risk that should be taken before the
Chilean Congress votes for Allende.
2. I, therefore, recommend that the position of the U.S. Govern-
ment be:
a. To view with great concern and urgency the need to find ways to
prevent the election of Allende because of the strategic implications of a
Soviet presence in Chile in the long term.
b. To initiate actions to get this done which have moderately high
political risk.
E. R. Zumwalt, Jr.
92. Backchannel Message From the Under Secretary of State for
Political Affairs (Johnson) to the Ambassador to Chile
(Korry)
1
Washington, September 15, 1970.
1. Meeting of 40 Committee Sept 14 covered at length and in some
detail the changing panorama in Santiago and focused on the Frei
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Sensitive. On September 15, Johnson
transmitted telegram 151170, Strictly Eyes Only to Korry. In it, Johnson informed Korry
that he would receive instructions regarding the Allende election problem in a back-
channel message and noted that, In carrying out and interpreting this instruction, I want
378-376/428-S/80023
September 5November 4, 1970 253
re-election gambit via the scenario by which Congress elects Ales-
sandri who resigns leaving Frei constitutionally free to run for the
presidency.
2
2. You should ascertain from Frei whether and to what degree he is
committed to this line of action. You may indicate to him that if he is,
we are willing to support his efforts in suitable and discreet ways. You
should report his precise words to us as promptly as possible. If he has
suggestions as to how we might support these efforts, please report
those fully as well.
3. You have at your discretion the contingency fund of [dollar
amount not declassified] previously requested for covert support of
projects which Frei or his trusted team deem important.
3
More can be
made available. If in your judgment Frei is willing to commit himself to
this course of action, you may in your discretion inform him of this
availability. (This fund may be disbursed as agreed between you and
the Station Chief.)
4. The Agency has begun and will continue a propaganda cam-
paign outside Chile on the danger of an Allende take-over. This will be
expanded to include support of the Frei re-election gambit.
5. Military contacts by all appropriate members of the Mission
should be intensified for the purpose of assuring ourselves that we
have the requisite intelligence to enable independent assessment of the
military determination to back the Frei re-election gambit.
6. Your role is thus very delicate one and you will be required to
walk fine line. We do not want to get out in front and we do not want to
take over. Yet we do not want their will to flag for lack of support.
7. In this regard we ask that you keep us currently and continu-
ously informed of the attitude and plans of the Chileans involved to-
gether with your recommendations so that we can jointly make judg-
ments on how far we want to go.
you to know that its language has been very carefully considered and approved at the
highest levels, including the President. Few Ambassadors have been given a more diffi-
cult or delicate assignment; the keynote of which is contained in para 6 of the instruction.
Good luck. (Ibid., RG 59, Central Files 197073, POL 14 CHILE)
2
No memorandum for the record of the September 14 meeting of the 40 Committee
was found. In an October 22, 1971, memorandumfor the record by Peter Jessup of the Na-
tional Security Council Staff, the September 14 meeting was listed as one for which there
were no detailed minutes due to the illness of the Executive Secretary. As a result, there
were only records of decisions. It noted that Kissinger, Mitchell, Packard, Johnson, Ad-
miral Moorer, Helms, Meyer, McAfee, Vaky, Karamessines, and Broe attended the Sep-
tember 14 meeting. (National Security Council, Nixon Intelligence Files, Subject Files,
Chile, 40 Committee Minutes)
3
According to Jessups memorandum for the record of decisions, on September 14
the 40 Committee approved [dollar amount not declassified] for use at Ambassador
Korrys discretion in supporting President Frei and the PDC and other sympathetic ele-
ments. (Ibid.)
378-376/428-S/80023
254 Foreign Relations, 19691976, Volume XXI
93. Editorial Note
At 3:24 p.m. September 15, 1970, President Richard M. Nixon met
with the Presidents Assistant for National Security Affairs Henry A.
Kissinger, Director of Central Intelligence Richard Helms, and At-
torney General John N. Mitchell at the White House to discuss Chile.
The meeting lasted until 3:44 p.m. (National Archives, Nixon Presiden-
tial Materials, White House Central Files, Presidents Daily Diary)
During the meeting, Helms took the following notes:
MEETING WITH PRESIDENT
ON CHILE AT 1525 SEPT 15, 70
PRESENT: JOHN MITCHELL + HENRY KISSINGER
1 in 10 chance perhaps, but save Chile!
worth spending
not concerned risks involved
no involvement of embassy
$10,000,000 available, more if necessary
full-time jobbest men we have
game plan
make the economy scream
48 hours for plan of action (Central Intelligence Agency, Job
80B01285A, DCI Helms Files, DCI Misc Papers on Chile, 1 January
7031 December 72.
A facsimile of the notes is in Hearings Before the Select Committee to
Study Governmental Operations with Respect to Intelligence Activities of the
United States Senate, p. 96. Further information regarding this meeting
was provided by Helms in his 1975 testimony to the Church Com-
mittee; see Alleged Assassination Plots Involving Foreign Leaders, pp.
227228. In Kissingers August 12, 1975, testimony before the Church
Committee, he gave the following account of this meeting: Now, at
that meeting with President Nixon, to my recollection President Nixon
did almost all of the talking. He indicated that he wanted the CIA to
take an active role in carrying out this general consensus, to see what it
could do to get the military to move. I dont think he expressed it that
clearly, but that was the gist of what he was saying, and he used the
figure of $10 million. Now, I want to be perfectly candid about this.
Anyone who worked with President Nixon day after day as I did
wouldnt have paid the slightest attention to that figure of $10 million.
That simply indicated that he wanted the project to be given high pri-
ority and, in any event, no such sum was ever spent, budgeted, used.
(National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121,
Chile ITT (Testimony)). Kissinger offers a similar account in The White
House Years, pp. 673674.
378-376/428-S/80023
September 5November 4, 1970 255
94. Memorandum for the Record
1
Washington, September 16, 1970.
SUBJECT
Genesis of Project FUBELT
1. On this date the Director called a meeting in connection with the
Chilean situation. Present in addition to the Director were General
Cushman, DDCI; Col. White, ExDir-Compt; Thomas Karamessines,
DDP; Cord Meyer, ADDP; William V. Broe, Chief WH Division; [name
not declassified], Deputy Chief, WH Division, [2 names not declassified]
Chief, Covert Action, WH Division; [name not declassified] Chief, WH/4.
2. The Director told the group that President Nixon had decided
that an Allende regime in Chile was not acceptable to the United States.
The President asked the Agency to prevent Allende from coming to
power or to unseat him. The President authorized ten million dollars
for this purpose, if needed. Further, The Agency is to carry out this mis-
sion without coordination with the Departments of State or Defense.
3. During the meeting it was decided that Mr. Thomas Karames-
sines, DDP, would have overall responsibility for this project. He
would be assisted by a special task force set up for this purpose in the
Western Hemisphere Division.
2
The Chief of the task force would be
Mr. David Phillips, [2 lines not declassified].
4. Col. White was asked by the Director to make all necessary sup-
port arrangements in connection with the project.
5. The Director said he had been asked by Dr. Henry Kissinger, As-
sistant to the President for National Security Affairs, to meet with him
on Friday, 18 September to give him the Agencys views on how this
mission could be accomplished.
William V. Broe
3
Chief
Western Hemisphere Division
1
Central Intelligence Agency, Job 79M01476A, File 010175300475. Secret; Sensi-
tive; Eyes Only. Drafted by Broe.
2
The records of the task force that oversaw the operation in Chile, commonly re-
ferred to as Track II, are in Central Intelligence Agency, Job 8000012A. Records from
this collection were made available to Department of State historians for review, but
copies were not provided for inclusion in this volume.
3
Printed from a copy that indicates Broe signed the original.
378-376/428-S/80023
256 Foreign Relations, 19691976, Volume XXI
95. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 16, 1970.
SUBJECT
ChileOur Modus Operandi
This is to confirm and elaborate on my oral recommendations to
you on mechanisms to carry out the 40 Committees decisions on Chile.
Unless some tight control and guidance is established, the action
program that was approved will not work. It is going to be a long-shot
as it is; we cannot afford the additional handicaps of unprofessional ac-
tivism, of lack of coordination and of bureaucratic resistance. Unless
we are to be professional and efficient about this and run it all very
tightly, we should stop mucking around.
The troubles are these:
State is timid and unsympathetic; it will provide neither the
imaginative leadership nor the tight coordinated overview we need.
Korry is imaginative, but he is an unguided missile. It is profes-
sionally bad from an intelligence-operation point of view for the Am-
bassador to be the project chief. He is too exposed; it is too dangerous.
But Korry does not trust his staff to do this, and feels he must
take the responsibilityand creditfor the operation. The Station
Chief cannot operate in these circumstances.
CIA is unhappy, but does not feel it can impose discipline on
Korry; it certainly cannot do it through its present Station Chief.
There is neither enthusiasm nor consensus among agencies up
here for doing any overall planning and thinking. Hence we tend to
react to what happens in Santiago, and ideas about new things to mesh
into the operation are neither forthcoming orif they areare imple-
mented adequately.
The 40 Committee does not have the time for this kind of close
supervision, and the long-lag would make it impossible anyway.
The result is that although no one particularly wants him to have
it, Korry has the ball and is running. Yet there is a curious lethargy and
muddled confusion with regard to doing anything about it. Everyone
just seems to have his fingers crossed hoping that no leaks or exposure
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive; Eyes Only. Printed from an uninitialed copy.
378-376/428-S/80023
September 5November 4, 1970 257
occur and that it all works out. We are not really sure if what we are
doing is professionally sound as possible or what more we might do
technically to improve the plans effectiveness.
I think this is a dangerous situation because (a) our risks of being
found out are maximized this way, and (b) our efficiency is cut.
There are only two alternatives it seems to me:
1. Establish an action task force here to run things; this would meet
on a daily basis, make decisions, send out directives, keep tabs on
things. It would coordinate activities on several fronts and be able to
think up and plan various operations to implement the program. There
are precedents for this. For it to succeed, the task force would have to
have the necessary authority to instruct the Ambassador; it would have
to work fast and in utmost secrecynot through normal bureaucratic
procedures. It would need to be run essentially by CIA, because it is the
professionality of a covert operation that we seek. It would need a
chairman of the authority of someone like Karamessines.
While this idea is infinitely better than our present situation, it still
suffers from the time lag that would necessarily be involved. In a fast
moving situation operational decisions may have to be made on the
spot.
For that reason, I prefer the following course:
2. Send to Santiago an expert to take over the program and to implement
it under the Ambassadors (and Washingtons) broad guidance. The Ambas-
sador would oversee and approve, but would draw back from personal
operations and involvement to protect himself. The activities would be
planned and run by the professional under the parameters established.
The expert would report to the Ambassador, but would generally be
the field general for our activity. (This is about what we did in 1964.)
The argument against this is that Korry will never let it happen. He
will still insist on doing it himself. That is probably true if CIA or State
take the initiative; he will just think it is the bureaucracy kibitzing. But
if the White House gives him the directive, he would do sohe would
have no choice. Even if his feelings are somewhat hurt, I see no alterna-
tive. The risks are too great otherwise.
378-376/428-S/80023
258 Foreign Relations, 19691976, Volume XXI
96. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Santiago, September 16, 1970.
1. I am extremely grateful for the confidence and support of Presi-
dent Nixon and the 40 Committee.
2. I am painfully aware of the delicacy of my situation and I trust
that you and your colleagues are equally aware of the long odds
involved.
3. President Freis attitude is very clear to me: He is 100 per cent
opposed to Allende but he will not repeat not move unless (a) he is con-
vinced he has a certainty of winning the fight and (b) he has a moral
base to justify his struggle.
4. To provide that moral base is largely our task in rapidly bringing
to the attention of the world that the process here is almost exactly the
same as that which led to the establishment of a Communist dictator-
ship in Czechoslovakia in 1948. Frei is Benes and people such as Min-
ister of Defense Ossa may be the future Masaryk, although not of the
same intellectual quality.
2
5. It is highly unlikely I shall be able to see Frei. I cannot go to the
Presidential palace without creating a storm; I cannot go to his home
any more since it is subject to the same observation that my residence
is. There are no U.S. visitors such as John Richardson in sight to provide
an innocuous cover for another talk. Hence I delivered my message to
Frei one hour after receipt of your message
3
through Minister of De-
fense Ossa [less than 1 line not declassified].
6. I told Ossa that there was no point in further analysis of the situ-
ation. Of course, I added, I wanted to be kept informed, but I was not
going to do anything aside from getting the truth to the world unless
and until the President made up his mind. We were prepared to give
appropriate support if Frei could decide his own course, but if he pre-
ferred to live interminably the Hamlet role, if he preferred to cite all the
reasons he could not act, there was no justification for anyone else to be
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive.
2
Edvard Benes, President of Czechoslovakia from1935 to 1938 and again from 1945
until 1948, and Jan Masaryk, Czech Foreign Minister from 1940 until 1948. Despite their
commitment to democracy, neither Benes nor Masaryk was able to prevent the Commu-
nist takeover of Czechoslovakia in February 1948. Masaryk died on March 10, allegedly
pushed from his bathroom window. Benes died of natural causes on September 3.
3
Document 92.
378-376/428-S/80023
September 5November 4, 1970 259
concerned about his fate or that of Chile. If he chose immobility, I
would regard him personally, and I was not speaking for my gov-
ernment, I stressed, as a pathetic castrate unworthy of either sympathy
or sustenance. I wanted to know precisely what he was willing to do.
Frei could reflect but if he had not made up his mind sometime in the
week after the big weekend holiday, I would take that indecision to
mean that he had opted for a Communist Chile. In the interim I would
be able to make tentative judgments by such public actions as the GOC
might continue to take in support of Allende in the economic and other
key sectors. Frei could not have it both ways, bemoaning his future and
hastening it.
7. Your instructions re military in Paragraph 5 of your message
will be applied by me in a manner best designed to obtain optimum po-
litical mileage and the necessary intelligence on military plans and atti-
tudes on which policy decisions can be based. I see little hope that they
can still be galvanized into action by anything we may or may not do.
They are a union of toy soldiers who need an order to move and that
order can only come from Frei. Otherwise they will rationalize and re-
inforce their impotence. Ossa has been seeking for days to elicit a state-
ment from them stating they support the constitutional process and
will maintain lawand order in defense of the constitution. They have so
far refused on the grounds it could be misinterpreted as political inter-
ference. Also, they have insisted that the September 19 planned demon-
stration for Frei not include any banners or signs in favor of the presi-
dent since the day was strictly a military one and could not be
despoiled by political acts. My recommendationand indeed my in-
structions unless specifically countermandedto our military except
in the case of our ubiquitous Army Attache is to limit all social contacts
and all communications with Chilean armed services aside from the
most minimal technical activities of the MilGroup. Such disdain will
probably have no effect of any great significance but we should show
indirectly that we do not consider them of any import. Perhaps some of
them will begin to reflect upon their moral cowardice and their lack of
qualification as either officers or gentlemen. You must also bear very
much in mind the message that I have persistently transmitted from
here for three yearsthat the elimination of grant military aid, the low
limits of MAP sales and the slashing of training funds (the most recent
example contrary to approved CASP) could only lead to the elimina-
tion of meaningful U.S. influences on the military. The MilGroup has
no repeat no influence. I am reviewing all possible means of utilizing
our military for some effect and I will perhaps submit some concrete
recommendations in the near future but we must keep in mind the
need to protect President Nixon from any unnecessary vulnerability,
particularly if our actions would most likely be ineffectual.
378-376/428-S/80023
260 Foreign Relations, 19691976, Volume XXI
8. I will send a joint message with [less than 1 line not declassified] on
what I shall be expecting from them.
9. Finally, we must keep the pressure on Frei and Frei principally.
If he is not going to make the moral commitment in the form of action,
no one should seek to make it for him. He told me and John Richardson
what he wanted from the U.S.propaganda abroadand he has in-
formed me through his lieutenants that he wants my advice. They in
turn are transmitting my suggestions and views; they also have indi-
cated they need assurances of being able to get out of Chile in extremis
and of funds at a certain point in time. I would hope that key members
of the U.S. business community would handle much of the funding
problem when and if we get to that point. But we are not there yet.
10. Other reporting follows in State channels; where unsourced it
is based on Ossa conversation.
4
4
Apparently a reference to Document 99.
97. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Santiago, September 16, 1970.
1. In a separate State message I am reporting (a) the mounting
pressures on the Cardinal of Santiago to recognize Allende, (b) on the
pressures abuilding against holdout El Mercurio and (c) the French ne-
gotiations with Allende.
2
I would welcome very prompt assistance
from Washington on all three:
A. [2 lines not declassified]
B. Is there some way to get First National City Bank to take heat off
El Mercurio? Bank, which is preparing to fold its local tent, is dunning
the paper for its loans. This kind of pressure is no less pernicious than
that of the Communists.
C. Can Department take any diplomatic action in Europe to pre-
vent rug-pulling.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive.
2
Document 99.
378-376/428-S/80023
September 5November 4, 1970 261
98. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 16, 1970.
SUBJECT
Korrys Reply to 40 Committee Cable
Attached are two cables from Korry in reply to the one we sent yes-
terday. Tab A is the general reply and at Tab B is a specific request.
2
I find Korrys answer very unsatisfactory and I believe we are now in a
most delicate and difficult position. We were led to believe that there was
at least a Rube Goldberg plan in operation. It seems evident from
Korrys cable that that is not the case. He is apparently trying to con-
struct something out of whole cloth and I submit that as an Ambas-
sador he cannot do that without irretrievably exposing himself and the
USG.
He states he has passed our message on to Frei through the De-
fense Minister. This is curious because his previous cables had indi-
cated another channel had been designated by Frei to represent him.
You can see from paragraph six (Tab A) that Korry is still trying to per-
suade people to take some political action.
Paragraph seven (Tab A) says he will implement our instructions
re military contacts in a way designed to obtain optimum political
mileage and the necessary intelligence. I do not know what political
mileage means but this is clearly outside of what he was instructed to
do. All of paragraph seven is a remarkable paragraph.
The requests in the message at Tab B are obviously not difficult to
fulfill but my question is to what end? Whom are we servicing, a Frei
plan as we thought, or Korrys efforts to play kingmaker?
I believe you have to focus on this. If Korry is not reined in, we are
going to be in a mess. I remind you of my memorandum of this date on
mechanisms to carry out the 40 Committees recommendations.
3
I think
it now urgent to get somebody down there to assess (a) Korry (and his
stability) and (b) the situation.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive; Eyes Only. Printed from an uninitialed copy.
2
Tabs A and B are Documents 96 and 97. They are in reply to Document 92.
3
Document 95.
378-376/428-S/80023
262 Foreign Relations, 19691976, Volume XXI
99. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 16, 1970, 2255Z.
3741. Subj: The Communists Take Over Chile.
1. There is a graveyard smell to Chile, the fumes of a democracy in
decomposition. They stank in my nostrils in Czechoslovakia in 1948
and they are no less sickening here today.
2. President Frei is more clear-minded than Benes. He has no
doubts that Allende means Communism, but he is frozen by indeci-
sion, by self-pity, by an unwillingness to risk all for democracy. He
wants an excuse for action and the certainty of success.
3. Frei has his potential Masaryks although here there will be no
demonstrations; rather, if Allende comes to power, they will either slip
out of the country or fade away.
4. For the moment, Frei and his supporters from both the PDC and
Alessandri camps are engaged in an under cover organizational opera-
tion that is unknown to a public that is being hammered only by Al-
lende propaganda. They want to keep open the option of what I have
accurately called a Rube Golderg contraptiona vote in the congres-
sional runoff Oct 24th for Alessandri who would renounce the Presi-
dency and thus provoke new elections in which Frei would run.
5. But there is an essential difference between the Christian
Democrats-with-Frei and the Alessandri people. The former are also
thinking that if this ploy does not work, then as a fallback, the PDC will
negotiate such guarantees from the triumphant Popular Front as to
assure a chance of maintaining democracy in Chile.
6. The current Christian Democratic leadership is concentrating on
these illusory guaranties. Negotiations are underway on different
levels between PDCers and Allendistas. The defeated candidate, Rado-
miro Tomic spoke at length in the Party National Council Monday
night in favor of immediate recognition of Allende as the President-
elect. He was answered effectively by Freis men who are seeking the
conflicting yet convergent goals of electing Frei and of extracting max-
imum safeguards.
1
Source: National Archives, RG 59, Central Files 197073, POL 15 CHILE. Secret;
Immediate; Limdis. Repeated to U.S. Southern Command and Asuncion, Bogota, Bonn,
Brasilia, Buenos Aires, Caracas, Guatemala, Kingston, La Paz, Lima, Managua, Mexico
City, Montevideo, Moscow, Panama, Paris, Port au Prince, Port of Spain, Quito, Rio de
Janeiro, Rome, San Jose, San Salvador, Santo Domingo, Tegucigalpa, London, The
Hague, Madrid, Brussels, and the U.S. Mission to NATO.
378-376/428-S/80023
September 5November 4, 1970 263
7. The economic situation in the country is not good in the short-
term. The refusal of many entrepreneurs to risk capital, the stoppage of
most private construction, the universal insistence on cash only trans-
actions, the widespread conversion of currency to dollars, the slow but
steady layoffs of workers, the downturn in production and consider-
able emissions by the state of currency will doubtless add considerably
to the high inflationary rate (30 pct as of Sept 1) and other economic
problems. It could have a snowball effect. Rather than seek to use this
deterioration to his political advantage, Frei is employing govt re-
sources to stabilize the economy, as Allende wishes.
8. Similarly the Armed Forces, more a trade union than anything
else (as I stated during last Octobers army sitdown strike) is only
willing to support constitutional processes. Frei will give them no order
to act and will take no action to provoke their action. The Armed Forces
CINCs have refused a suggestion from a high Frei lieutenant to issue a
public statement that they support the constitution and that they will
guarantee the law and order necessary for such processes. By choosing
silence, they are in effect endorsing the spurious Communist-Socialist
threat of civil war if Allende is blocked from the Presidency.
9. The Armed Forces have also requested the supporters of Frei to
tone down the major demonstration planned in favor of the President
on the most patriotic of Chilean holidays, Sept. 19th, when the three
services put on their major parade of the year. They wish no banners or
signs in favor of Frei because they consider political action to be a dis-
ruption of the one day of the year that is truly the militarys. The Armed
Forces are by and large convinced that if they retain their profession-
alismthe word is used in the conditions set forth by the PDC in its
talks with Allende & Codemocracy will be maintained in Chile.
Equally innocently, they assume there will be no disruptions between
Chile and the US that could affect them and they are reinforced in this
view by the almost complete disappearance of US military support for
Chile in the past three years. (The end in 1967 of grant milaid, the con-
gressional restrictions on sales, the modest ceilings on MAP sales and
the almost complete disappearance of CONUS training have had the
depressing effect we have long been forecasting.)
10. The Christian Democrats are the lever Frei (and everyone else)
wants to pull. But it is a divided partysome would say split between
knaves and fools. A few have no illusions about Allendes dependence
on the Communists and, therefore, the nigh-inevitability of the future
structure and direction of Chile. These few, who are leading the organi-
zational effort on behalf of Frei, have been directly threatened by
friends with the loss of everything if they do not desist; everything
has been spelled out to include murder. They, in turn, have recruited
perhaps a total of 38 PDC Deputies and Senators of the partys repre-
378-376/428-S/80023
264 Foreign Relations, 19691976, Volume XXI
sentation of 74 who are more or less pledged to vote for Alessandri in
the runoff. Opposed to them are, by their count, perhaps 18 who favor
Allendes accession. Thus in mathematical terms, Alessandri could
count on his 45 supporters, 38 PDCers and at least five and perhaps ten
radical defectors or a total of between 88 and 93 of the 199 congres-
sional votes.
11. But a paper tally can be as misleading as polls. Not only do the
Communists believe they have 30 certain PDC votes in support of Al-
lende plus the minimum of 75 they count as being firmly in the Allende
camp (an absolute majority of 105) but more importantly the PCCh is
cock-a-hoop with confidence that they have all the trends in their favor.
Their skillful blend of mass terror via the civil war threat, private terror
against holdouts, negotiations with the PSC and almost complete con-
trol of the media and universities is, in their view, an unexcelled elixir.
As Baudelaire said of the devil: and the rich metal of our own volition
is vaporized by that sage alchemist.
12. Will, that most precious of all faculties, is not one of Freis
trademarks. Will is what appears most clearly in a masterwork, said
Valery. No vagueness as to ways and means. No uncertainty as to ob-
jective. Frei has at least three objectives: to act as President of Chile
without exposing himself to anyones darts; to be a shadowy alterna-
tive to Allende; and to rationalize the deal that his PDC might strike
with Allende. If he cannot choose soon, that most clear-minded and co-
hesive force in Chile, the Communist Party, will do it for him. Allende
is their masterwork in Latin America and they do not lack for purpose
or will.
13. I can hardly blame Frei when I read the world press. There is
hardly a flicker of interest in the disappearance of South Americas ex-
emplar of democracy; there is hardly any awareness abroad of how the
press is being silenced, how the radio and TV is almost totally in
Communist-Socialist control, of how the Army has been cowed and the
politicians terrorized. If our and the European press can rationalize
what is doubtless the most important event in this hemisphere since
Castro, why should not Chilean politicians indulge in the almost un-
limited human capacity for adaptability?
14. A few postscripts of some import:
A. Tomic in his plea for Allende told the PDC that the rightists
and the State Department are the only opponents. Tomic is doubtless
referring to the Depts statement and my echo of it to Allendes emis-
sary last week that the constitutional process is still underway, a state-
ment that a man of Tomics persuasion could only interpret as support
of the Rube contraption.
B. The leftist press is applauding Foreign Minister Valdes for
having circularized his Missions to counter, as Clarin put it, conspira-
378-376/428-S/80023
September 5November 4, 1970 265
torial maneuvers of ultra right Chileans and actions such as those of
New York Times and is intended to support true situation and future of
Chile.
C. The secret negotiations between the PDC and Popular Unity on
the army include discussions of a secret annex proposed by the PDC to
maintain the present high command for one year and then any change
with their approval.
D. The Frei camp is concentrating on gaining delegates to the PDC
party junta that will take the final decision sometime in October.
E. Frei had a talk in Vina del Mar with OAS SecGen Galo Plaza that
may have shaken that gentlemans view that Communism could not
happen in Chile. Other Latin Americans attending OAS conference
there have also begun to have second thoughts.
F. The only strong voice of press dissentEl Mercurio of Chileis
still thundering in its editorial columns but nowhere else. Its manage-
ment is under such threat of physical harm that it is questionable if the
paper can resist the terror campaign.
G. The Cardinal of Chile has just been dissuaded for the third time
from making his call on Allende. Unless there is divine intervention, he
may soon go the way of all flesh. And the faithful will flock behind him
in an over-powering wave.
H. The French Ambassador is busily seeking a deal with Allende.
In return for recognition there would be major advantages for French
firms. Can the British be far behind? Or the Italians?
Korry
378-376/428-S/80023
266 Foreign Relations, 19691976, Volume XXI
100. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 17, 1970.
SUBJECT
Chile
Unless we establish tight control and professional guidance, the
covert action program approved by the 40 Committee for Chile will not
work. It is going to be a long-shot as it is; if we have to face the addi-
tional handicaps of well-meaning but unprofessional activism, of lack
of coordination and of bureaucratic resistance, we will be dangerously
exposed.
The situation is as follows:
State is timid and unsympathetic to a covert action program; it
will not be able to provide either the imaginative leadership or the tight
coordinated overview we need.
Ambassador Korry is imaginative, but he is an unguided mis-
sile. He is acting now as his own project chief and is trying to con-
struct an operation all by himself. This is dangerous from a professional
intelligence-operations point of view, and inefficient because there are so
many inhibitions on his capacity to operate. He is too exposed and visible
to do this kind of thing, and it may even affect his objectivity and analysis.
But Korry does not trust his staff and will not use it; most of his
key officers, including the CIA Station Chief, have been cut out of the
operation.
Only Korry is doing any real reporting, and while it is volu-
minous, it is inconsistent and contradictory. We cannot be sure of
what the situation really is and how much Korry is justifying or
camouflaging.
CIA is unhappy at the modus operandi, but does not feel it can
impose discipline on Korry; it certainly cannot do it through its present
Station Chief.
There is no consensus among agencies here concerning the full
scope of operations and some lack of enthusiasm for overall planning.
Hence, the bureaucracy is simply reacting to what happens in Santiago.
1
Source: National Archives, RG 59, ChileITTCIA Files, Lot 81D121, Interview
with Secretary Kissinger, Monday, January 10, 1976. Secret; Sensitive. Sent for action. Al-
though no drafting information appears on the memorandum, the text is largely based on
Vakys September 16 memorandum to Kissinger, printed as Document 95. An attached
note, September 21, reads: Back from President Chile Program Approved (Haig has
seen).
378-376/428-S/80023
September 5November 4, 1970 267
The 40 Committee does not have the time for this kind of
close, detailed supervision, and the time-lag would make it impossible
anyway.
Thus, in effect, although no one particularly wants him to, Korry
has the operational ball and is running, with everyone just hoping there
are no leaks or exposures. We are not really sure if what is happening is
professionally sound as possible or what more we might do technically
to improve the effectiveness of our actions. Thus our risks of being
found out are maximized, and our efficiency is cut.
To rectify this situation, I recommend the following:
1. Establish an action task force here in Washington to run the pro-
gram. This would meet daily, make decisions, send out directives, keep
tabs on things. It would coordinate activities, and plan implementing
actions. It would work fast and in secrecynot through normal bu-
reaucratic procedures. It will need your authority to do this, and to be
able to instruct the Ambassador.
2. Send to Santiago an expert professional to take over the operational
program under the Ambassadors and the task forces broad guidance.
This would enable the Ambassador to draw back from personal opera-
tions and involvement. In addition, it will help with the time-lag
problem. In fast-moving situations some operational decisions may
have to be made on the spot.
Recommendation
That you authorize the establishment of this kind of mechanism.
2
2
President Nixon initialed the Approve option.
378-376/428-S/80023
268 Foreign Relations, 19691976, Volume XXI
101. Backchannel Message From the Ambassador to Chile
(Korry)
1
Santiago, September 17, 1970.
Situation Report.
1. Trust that consumers understand that Embassy 3741 Commu-
nist take over is designed to provide base for propaganda action that I
hope will unfold in Europe and LatAm.
2
2. Copei anti-Allende declaration given good play Mercurio today
under Caracas dateline and helpful.
3. Anticipated Viaux statement came out last night and in Mer-
curio, Channel 7 (govt) and several radio stations. It just might provide
the spur to the Armed Forces CINCs to issue their own statement
which was my intention in forcing Ossa to stop working against Viaux
statement. Emb will send septel.
3
4. MinFinance Zaldivar had himself interviewed by national TV.
He took as pretext alleged breaking of rules by Popular Unity liaison
Vuskovichs declarations to press, Zaldivar stating agreement had been
that only Minister could make statements on economy. Zaldivar clev-
erly emphasized deteriorating economic situation in country while re-
citing how GOC taking all appropriate measures. Emb will send
septel.
4
5. You can regard both Viaux and Zaldivar statements as earnests
of intentions from at least Ossa since these two items were high on my
list of insistences in my Monday talk with Ossa.
5
6. Can someone convince USIA (suggest talk to Shakespeare) to
have his organization replay Mercurio editorials that we have been
sending past few days but which they refuse to use? How can they dis-
tribute Allende propaganda material such as Time Magazine interview
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 1970. Secret; Sensitive. Broe transmitted a copy of this
message to Vaky. It was received at the White House at 12:15 p.m.
2
Document 99.
3
Telegram 3763 from Santiago, September 17, reported that Although Viaux in-
sisted that he has no political commitments, he also underlined that he is not Marxist nor
has he ever been one, and that Fatherland is not negotiable nor liberty compromisable.
Viaux concluded terse pronouncement with assertion he would never be party to ma-
neuver to divide army and announced readiness to take place alongside comrades-
in-arms should higher interests of Fatherland require. (National Archives, RG 59, Cen-
tral Files 197073, DEF 9 CHILE)
4
Not found.
5
September 14; reference, however, is presumably to the meeting between Korry
and Ossa on September 15, as reported in Document 96.
378-376/428-S/80023
September 5November 4, 1970 269
with Allende (on VOA) and refuse to touch Mercurios excellent
editorials?
102. Backchannel Message From the Ambassador to Chile (Korry)
to the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 17, 1970.
Set forth below is a message for Dr. Kissinger from Amb. Korry
which was received at 2030 hours 17 September, 1970.
1. I reckon that if something is to happen to stop the Allende Presi-
dency, it will occur this weekend or never.
2. What I believe could happen, starting in a few hours, is the fol-
lowing scenario:
A. A public declaration over all media from the Minister of Finance
and/or the Minister of Economy informing the country that the eco-
nomic situation is desperate.
B. The resignation of the two Ministers tonight or tomorrow, fol-
lowed by the resignation of other Ministers.
C. The appointment of military to fill the portfolios of Interior, De-
fense, Health and Labor. (The two economic slots are question marks
because the military considers these sectors beyond their competence
but I trust they can be persuaded to use advisors.)
D. The resignation of President Frei and his appointment, as the
constitution permits, of an interim President who would be one of the
Armed Forces CINCs.
E. A declaration by the junta that it wishes to assure the country a
democratic choice of its system and of its next President.
3. There are several weak points in this script, all named Frei. He
had maneuvered skillfully to produce the crisis, but, as is his habit,
always permitting others to push the process step by step for him. If he
were not to permit the resignations of the two Ministers, if he were not
to resign as a consequence, if he were not to persuade the Army CINC
General Schneider, the most constitutionalist of all the military, to go
along with this scheme, it could become unstuck. And if the military
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 1970. Secret.
378-376/428-S/80023
270 Foreign Relations, 19691976, Volume XXI
does not act with speed and skill, qualities with which they are not or-
dinarily endowed, the coup could become a very sloppy and bloody
mess.
4. The military situation has been at least temporarily transformed
by the statement last night of retired General Viaux.
2
While the public
considers the declaration to be trivial and egocentric, the Army, the
Armed Forces and Frei believe it to be of transcendental significance.
Viaux is considered by the military, with good reason, to have consid-
erable influence with the younger officers and the non-coms. The men
who really control the troops. As President Frei said to a trusted source
today, the Viaux statement served to bring the army in line, unifying it
while at the same time demonstrating that Chilean generals are not for
sale. (The latter is a reference to Viaux rebuff of Allende.)
5. Because my interpretation of Viaux influence tallied with Freis,
I persuaded MinDefense Ossa Monday night to cease trying to block
the Viaux statement on which I had given the green light to Raul Saez
last weekend. Incidentally, for the record, [less than 1 line not declassified]
has performed a very valuable service for me in helping to elicit this
message from Viaux.
6. Equally strongly with Ossaand that means FreiI pushed for
the MinFinance statement that I hope is coming shortly. Since Frei in-
sisted on a moral justification for any action, I could think of only the
economic situation as providing it. The MinFinance and the MinEcon-
omy are determined to resign; they are so persuaded because they
want to provoke the crisis and push the military and Frei to action.
They are both good friends; indeed they are the only two Ministers in
whom I have absolute confidence and with whom I have maintained
the most special friendships. But I have stayed totally clear of them,
preferring to deal with the minimal contacts, in this case, Ossa and
Saez. The latter exercises considerable influence with both.
7. Most of Chile began at noon today the national independence
holidays. The Armed Forces have been goose-stepping through their
parade drills for days in preparation for the big parade I will attend Sat-
urday. Tomorrow morning there is the Te Deum in the Cathedral with
all of us diplomats in our monkey suits. The mass of the country is pre-
pared to drink itself into a stupor, to spend its extra wages and to have
a respite from the intensive political talk in this country that should be
rechristened Blahblandia. But the forces that Santiago Garrison Com-
mander Gen. Valenzuela informed me two weeks ago Sunday
3
would
be concentrated in Santiago are here in less but sufficient numbers and
2
See footnote 3, Document 101.
3
September 6; see Document 65.
378-376/428-S/80023
September 5November 4, 1970 271
for the moment the army is more or less united for the first time in a
long time.
8. Frei believes that the combination of the Viaux and the economic
statements will be sufficient to provoke the army takeover. Frei this
morning compared the Armed Forces to a stretched rubber band that
was ready to snap. He said they were now fighting as a caste.
9. However, Frei did not say he would specifically give the ap-
proval to the army takeover. He did not say he would convince
Schneider. He did not say he would resign. And these lacunae worry
me. He may be assuming that he has structured the situation to move
itself, his favorite method of political action. His may be a very large as-
sumption. He was much more final in his judgement about the future if
the Armed Forces did not move. He said he would have not hope in the
Rube Goldberg political contraption; he said that he could not win
more than 25 per cent of his own party for the political formula route
and that he had discarded it. It was the army or nothing.
10. My moment of decision is at hand. I must decide what if any-
thing I must do to make Freis decisions again for him; I did it in the
case of the Anaconda negotiations last year but that was kinder-garten
exercise in comparison to this olympic gymnastic. I seek no advice be-
cause we have done everything possible to touch all bases: Gen. Valen-
zuela knows very clearly my views; the Ministers of Economy and Fi-
nance are fully aware of my sentiments; Frei has been told; and they all
are informed as to how they must proceed against those who threaten
to plunge the country into civil war. I have excellent support for [from?]
those here who need to know.
11. Tally ho.
378-376/428-S/80023
272 Foreign Relations, 19691976, Volume XXI
103. Backchannel Message From the Ambassador to Chile (Korry)
to the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 18, 1970.
PROGRESS REPORT 1
1. Minister of Finance and Minister of Economy neither spoke nor
resigned so far (i.e., 18 September, 1300 hours). Possible explanation is
that timing would be much more effective after holiday, perhaps
Sunday night when public has begun sobering after wet weekend.
2. First rule of all successful coups has been broke, too many ci-
vilians are aware of the scenario. I must assume Allende and Tomic
forces are in the know.
3. Te Deum attended by entire government, all top military, dip-
lomats and hardly anyone else. Almost empty Cathedral guarded by
largest concentration of police Ive ever seen with one every five feet in-
side. Believe crowd kept outside because of fear of extreme rightist
plotting against life of Frei.
4. Soviet Ambassador was in evidence for first time after two
months vacation in USSR.
5. We transmitting today to Helms text of my message to General
Valenzuela of September 6 that he read four times before reluctantly
handing it back.
2
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, 1970. Secret; Sensitive; Eyes Only.
2
Reference is presumably to the message transmitted to Valenzuela by the Army
Attache; see Document 65.
378-376/428-S/80023
September 5November 4, 1970 273
104. Memorandum for the Record of a Meeting of the 40
Committee
1
Washington, September 19, 1970, 10:4511:15 a.m.
SUBJECT
Chile
PARTICIPANTS
ChairmanHenry A. Kissinger
StateU. Alexis Johnson
DefenseDavid Packard
CIARichard Helms
JCSAdmiral Thomas Moorer
NSC StaffViron P. Vaky
SUMMARY OF DECISIONS
1. To hold another session at the end of the Middle East WASAG
meeting Monday morning, September 218:30 a.m.
2
2. a. Admiral Moorer to prepare material on possible military
assistance.
b. Mr. Vaky to prepare material on possible outcomes of proposed
action and possible U.S. postures.
A cable from the CIA Station in Santiago was distributed to the
principals to read. (Dr. Kissinger has copy.) It was made clear that no
one else other than the principals has seen this report.
3
Dr. Kissinger pointed out that the operation apparently is un-
derway spontaneously, and that he does not see anything that we can
or should do. The question was what happens when and if it starts. We
will have to examine whether there is anything for us to do in those
circumstances.
Mr. Johnson pointed out that it might create widespread violence,
perhaps leading to civil war.
Mr. Packard said that he wasnt sure of that because Allende just
might wait for the next round. It is difficult to know how to assess the
situation.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile, 40
Committee Minutes. Top Secret; Sensitive. The meeting took place in the White House
Situation Room. A handwritten notation on the first page indicates that Vaky drafted the
minutes.
2
No mention of Chile was found in the September 21 WSAG (Washington Special
Actions Group) minutes. A meeting of the 40 Committee was held Tuesday, September
22, at 8:10 a.m. See Document 111.
3
Document 105.
378-376/428-S/80023
274 Foreign Relations, 19691976, Volume XXI
Mr. Vaky commented that first it should be understood that the
Popular Unity (UP) was a heterogeneous group. Not all of the elements
would resort to violence; some, such as the Radicals, might even wel-
come this turn of events. Secondly, it was not clear that Allende himself
would stay to fight; he might well leave the country. Thirdly, the Com-
munist hard-core and the Socialist extremists probably would resort to
violence. They had a labor union core and a local peasant core and
might well cause widespread and serious internal a security situations.
Another element to consider was the previous intelligence reports that
the non-commissioned officers were infiltrated by Leftists and were in
sufficient number Allende sympathizers. The question as to whether
the troops would respond to orders needed further assessment.
It was agreed that the movement reported in the cable was
self-generated.
Mr. Helms confirmed that we were not in specific contact with the
military on this point.
Mr. Johnson said that then we really had only two choices: either
tell them to turn it off, or encourage them.
Dr. Kissinger said the President would certainly not approve the
course of action telling them to turn it off. We do have the choice of
merely standing back or egging them on. He saw little point in the
latter.
Admiral Moorer and Mr. Helms commented that other Latin
American military would stand clear.
Mr. Helms reported a conversation he had with [name not declassi-
fied]. It was quite clear that Argentina and Brazil are up-tight. The Bo-
livian military are apprehensive. Only Peru seemed to welcome the
course of events, and there was no idea there that they would intervene
in any way.
Mr. Packard said we had to decide how we would like all this to
come out. In his view what we wanted was a successful military action
but without us involved.
Dr. Kissinger said that if it happens, however, we need to be ready
for contingencies. For example, what do we do if there are civil dis-
orders; what do we do if there is civil war; what do we do if asked for
equipment.
Mr. Helms pointed out that the Chilean Army might very well
need munitions or crowd-control weapons.
Mr. Vaky added that if we were asked to supply them we might
consider clandestine channels rather than through MAP.
Dr. Kissinger said that the WASAG meeting on Monday should
tack this item on at the end.
378-376/428-S/80023
September 5November 4, 1970 275
It was agreed that the WASAG meeting would be held at 8:30 AM
Monday, September 21.
Dr. Kissinger asked Admiral Moorer to prepare a paper on how
military assistance might be provided. Mr. Vaky was asked to prepare
material on various possible outcomes and recommended U.S. posture.
105. Memorandum From the Station in Chile to the 40
Committee
1
Santiago, September 19, 1970.
DOI
17 September 1970
PADA
Chile, Santiago (17 September 1970)
SUBJECT
Possible Move by Chilean Armed Forces to take over Government with the
Knowledge of President Eduardo Frei
SOURCE
[9 lines not declassified]
SUMMARY
The Chilean armed forces may stage a coup shortly. Whether they move
depends on President Frei who believes there is no longer hope for a
constitutional solution and recognizes the necessity of military intercession but
has not committed himself in any way. General Valenzuela, Commander of the
Santiago garrison is playing a key role in the planned takeover and has reached
an understanding with retired General Viaux. The armed forces do not rule out a
violent reaction, possibly bordering on civil war, on the part of the left if the
military take over the government. End summary.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive. This memo-
randum is addressed to Kissinger, Mitchell, Packard, Johnson, Moorer, and Helms. The
memorandum was distributed under cover of a September 19 memorandum from Kar-
amessines, which noted that Kissinger had requested that it be disseminated to the prin-
cipals of the 40 Committee and discussed at the next meeting. Most of the information in
the memorandum had already been reported by Korry in his backchannel message sent
the evening of September 17 (Document 102). However, in subsequent discussion at the
40 Committee meeting (see Document 104) and in an NSC memorandum (Document
106), reference is only made to the CIA report and the September 19 report.
378-376/428-S/80023
276 Foreign Relations, 19691976, Volume XXI
1. The Chilean armed forces may move soon to take over the gov-
ernment. Whether they act depends on their receiving a go-ahead from
President Eduardo Frei involving authorization to take the following
steps.
A. Resignation of the Cabinet: (Headquarters Comment: Two inde-
pendent sources, who are fairly reliable, on 17 September reported
rumors that Andres Zaldivar, Minister of Finance, and Carlos Figueroa,
Minister of Economics, planned to resign.
B. Formation of a new cabinet composed entirely of military
leaders.
C. Appointment by Frei of an Acting President.
D. Freis departure from Chile.
(Field Comment: Source gave the impression that an important seg-
ment of the armed forces appears to be prepared to accept the above
formula and to act accordingly.)
2. After taking over the government, the armed forces plan to
publish a manifesto, stating that two-thirds of the Chilean people
should be given another opportunity to opt between the Popular Unity
(U.P.A coalition of Marxist, Socialists and other Leftist Parties), and a
democratic regime and that the armed forces are prepared to tender the
necessary guarantees of another free election. (Headquarters Comment:
Marxist Salvador Allende, the U.P. candidate won a plurality (36%) in
the 4 September 1970 presidential election in a three-way race against
an independent and a Christian Democratic candidate).
3. General Camilo Valenzuela, Commander of the Santiago gar-
rison, is playing a key role in the planned military takeover of the gov-
ernment. Valenzuelas plan involves the arrest of about two hundred
key U.P. functionaries.
4. Valenzuela has had several meetings with Retired General Ro-
berto Viaux, leader of the October 1969 military dissension, and a full
understanding has been reached between them. A statement published
in the 17 September 1970 edition of the independent newspaper El Mer-
curio over the signature of Viaux to still speculation that he might sup-
port Allende was cast in its final form by Valenzuela.
2
(Source Comment:
In his statement Viaux denies harboring Communist sympathies and
stated that he was willing to serve his country in whatever capacity re-
quired. The significance of Viauxs statement is that the armed forces
now have the necessary assurances that Viaux will not move unilater-
ally. Frei said that the greatest importance should be attached to
Viauxs statement which was well received by the armed forces and
2
See footnote 3, Document 101.
378-376/428-S/80023
September 5November 4, 1970 277
which had served to bring the army in line, unifying it while at the
same time demonstrating that Chilean generals are not for sale.)
5. The armed forces cannot rule out violent reactions on the part of
Allendes followers which could develop into a situation bordering on
civil war. According to Valenzuela, the army has within its ranks no
more than five percent of Allende sympathizers. Twenty percent of the
air force, on the other hand, is believed sympathetic toward Allende.
(Source Comment: Since the air force is not going to play a decisive role,
other than giving its approval, this factor will not appear to matter a
great deal.)
6. In a conversation between President Frei and Rene Silva, the di-
rector of El Mercurio, Frei said that Minister of Finance Zaldivar is going
to make a statement which, in Freis opinion, is going to cause major
commotion. When asked whether Viauxs statement and the one
planned by Zaldivar would provoke a cabinet crisis causing wholesale
resignations, Frei replied he thought it would go that way. If that hap-
pened, Frei said he did not rule out the formation of a new cabinet com-
posed of military officers, but expressed his opinion that a military cab-
inet would not be necessary since it was his belief that the military
would take over the government. (Field Comment: Source received the
impression that Frei may be pushing the military to act using Sergio
Ossa, Minister of Defense, to assert pressure on the armed forces.)
7. Frei compared the situation in the armed forces to a Rubber
band on the point of snapping. According to Frei, something will hap-
pen soon because the armed forces now realize that they are struggling
for institutional survival and that, as far as the armed forces are con-
cerned, the struggle has now taken on a new dimension.
8. Frei unambiguously stated that all thought of pushing through
Congress a political formula, i.e., the election and then resignation of
independent candidate Jorge Alessandrishould be discarded. At best
Frei said he would be able to round up 25 per cent of the Christian
Democratic Party (PDC)s congressional contingent in support of that
formula and would thereby split the party. Having ruled out the effec-
tiveness of a political solution, Frei had come to the conclusion that a
military solution was the only one. Frei added that Chile was a country
which could not be turned over to Allende.
9. (Source Comment: Frei, during the whole course of the conversa-
tion, never gave any indication of committing himself in any way. He
addressed himself only to the necessity of military intercession and
narrated what he thought others would be doing.)
378-376/428-S/80023
278 Foreign Relations, 19691976, Volume XXI
106. Memorandum for the 40 Committee Prepared by the
National Security Council Staff
1
Washington, September 20, 1970.
SUBJECT
Chile
If the Chilean military move to prevent Allende from taking
power:
a. What kinds of problems and reaction can be expected?
b. What diplomatic posture can or should the US take?
I. Possible Courses of Developments
Should a military/civilian coup occur, along the lines described in
September 19 report,
2
the new interim government would have the fol-
lowing major problems to face:
To cope with the reaction from Allende forces;
To maintain law and order and a viable economic life for the
country;
To secure reasonable acquiescence or support for a framework
and formula for government, e.g., new elections.
Reaction to a military move may take one of the following courses
listed below in order of likelihood, i.e., from most to least likely:
A. Civic pressure by Allende forces to force military back-down.
This would involve attempts to stage general strikes, transporta-
tion stoppages and disruption of public services, street demonstrations,
mobilization of public opinionall with the intent of paralyzing the
nations life so as to create irresistible pressure on the military to back
down.
The Allende forces are almost sure to try this course of actionit is
the least they can do. They have a very good chance of disrupting
things initially, given Communist Party influence in the labor move-
ment. It is less certain they can sustain any significant paralysis for
more than several days if met with firmness. In any case, the situation is
not likely to stop at this level for long; if strikes and similar activity do
not succeed, the Allende forces are likely to escalate their counter-
revolution to one of the following levels.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 1970. Secret; Sensitive. Although the memorandum
bears no drafting information, it was most likely written by Vaky.
2
Document 105.
378-376/428-S/80023
September 5November 4, 1970 279
B. Civic violence to force military breakdown or dissolution of militarys
cohesion.
This would involve street violence, rural violence, squatter inva-
sions, possibly terrorism and sabotageall designed to achieve either
or both of the following: (1) to create such chaos the government col-
lapses, or (2) to provoke the military into enough violent repression to
provoke overwhelming popular opposition to the coup.
There is about a 60% chance that the Allende reaction will merge
into this level or move to it immediately. Capacity to provoke riots or
sabotage does exist; however, capacity to sustain this sufficiently long
to be successful is less clear. Still more doubtful is whether sustained vi-
olence of this kind will receive popular support in a country that does
not like violence.
The military/police will be strained if violence is spread in several
places or sustained for a long period. If the military is not unified, it is
doubtful the government could contain the situation. If the military is
required to use violence against citizens, e.g., shoot workers or stu-
dents, it may not be able to hold the situation. Much depends upon
governments backing and leadership and the will of the security
forces.
C. Counter-coupdivide the military
This would involve an effort to persuade units and troops to op-
pose a takeover, disobey orders or to launch a counter-coup.
The Allende forces will undoubtedly try this, and are already
seeking to persuade military personnel not to support any plan to
launch a coup. This is unlikely to be successful, but the position of
non-coms is admittedly a question mark. If the military, following a
coup, must use repression to sustain their success, the chances of a de-
fection or counter-coup rise proportionately.
D. Long-term insurgency
This would involve a long-term effort to subvert the coup-installed
regime, sabotage subsequent elections, and bring about a leftist gov-
ernment. It would in effect be the result of a failure to prevent the initial
military coup or secure its reversal through the preceding courses. It
would involve insurgency, sabotage, terrorism, and efforts to spread
popular disaffection and to hamper government economically and po-
litically so as to make government impossible.
There is a less than even chance this will occur. If initial efforts fail,
the left extremists are not likely to have the leadership or assets left to
mount a significant effort of this kind in the immediate future. On the
other hand, nuclei can be supported from outside, and this may be the
response favored by the Communist and Castroist elements.
378-376/428-S/80023
280 Foreign Relations, 19691976, Volume XXI
E. Civil War
This would be the result of steady escalation of civic violence and
consequent polarization in the society, with military and para-military
units dividing against each other. This situation is not likely to be vis-
ible or easily identifiable as suchit is likely to emerge, if it does, only
as the extension of other violence and the result of the degeneration of
the situation into chaos.
A chaotic, civil war situation will clearly invite external interven-
tion from the outside on both sides. A clearly chaotic situation is one in
which legitimized intervention is easiest, i.e., OAS, mediation, Rio
Treaty action, Inter-American Peace Committee.
III. [II] Key Factors
The following are key factors in determining whether a military
move of a kind contemplated succeeds:
A. What Allende does personally.
If Allende stays and personally commits himself to violent resist-
ence, the chances for widespread serious instability and violence are
sharply increased. If he decides not to do so or leaves the country, or is
made to leave the country, the chances for successful violent resistance
are proportionately decreased. Allendes personal leadership and cha-
risma are important.
B. Unity of the military
No military action, or support of a successor regime, can be
achieved without reasonable unity among the armed forces. If there are
any defections of major units, no effort is likely to succeed. A particu-
larly key factor is the loyalty of non-coms and troops to their officers.
There have been reports of Allende sympathy in enlisted ranks and of
doubts on the part of commanding officers that troops would follow
them. If this were the case, no coup and no effort to maintain law and
order against heavy civic violence are likely to succeed.
C. What Frei does
Just as Allendes leadership is important to his forces, Freis leader-
ship is essential to the coup/electoral formula in the same but converse
terms.
D. The Governmental Formula
A coup which promises new elections is more likely to succeed
than a mere seizure and retention of power by the military. It is more
likely to secure the support of civilian and elite elements. A mere
power-seizure will elicit opposition among non-Allende forces and be
divisive within the military itself.
IV. [III] Most Likely Situational Problems That May Arise
From an external point of view, the situational problems most
likely to arise are:
378-376/428-S/80023
September 5November 4, 1970 281
A. Chilean military request for arms and aid.
The military are very likely to use up their crowd-control supplies
(tear gas, etc), small arms, and ammunition fairly rapidly. They may
even need additional communications, transportation to cope with a
widespread security situation. They will in all probability turn to the
U.S. for this aid, but they may also turn to other Latin American or to
European countries.
B. Chaotic civil war type of situation
If a complete breakdown in order and national life and widespread
bloodshed and violence of a civil war kind occur, or is threatened, the
question will arise as to whether outside intervention is not desirable to
stabilize the situation, prevent chaos and bloodshed. OAS, Inter-
American Peace Committee, Rio Treaty are all possible in these situa-
tions. Effective intervention need not be military intervention; me-
diation, good offices, OAS-supported formula for elections are all
possibilities.
C. Economic support to shore-up interim Government
An interimor subsequently elected governmentwill probably
require additional budgetary resources to keep the situation stable and
insure popular support. The need may be sustained and large. Again
Chile is likely to turn to the U.S., the Inter-American and World Banks,
possibly to Europe.
D. Consequences of success or failure
In sum, if a military/civilian coup succeeds, the resulting government
will have very difficult problems in maintaining law and order; keep-
ing the society together; insuring sufficient popular support to be vi-
able; maintaining a climate in which a new election can be held and the
results sustained; keeping the economy healthy.
If a coup is attempted and fails, the military will be destroyed. The
Communists will have the opportunity to move quickly and with cer-
tainty to destroy most of the societal and institutional barriers to a
Marxist regimemilitary, opposition parties, press.
V. [IV] U.S. Posture
A. Basic Posture. The policy questions posed for us by a Chilean
coup attempt are:
1. Do we support the military effort if our help is needed, i.e.,
equipment, etc., money? Do we do so openly or clandestinely?
2. Do we adopt a public posture of neutralism, or of support, or
something in-between?
It is unlikely that a military/civilian coup can sustain itself without
some kind of external assistance. Hence, if we do not extend some kind
of help it will collapse. On the other hand, open and visible U.S. sup-
378-376/428-S/80023
282 Foreign Relations, 19691976, Volume XXI
port runs the risk of damaging the Chilean military/civilian base of
supportand conversely strengthening Allendeby making the coup
appear to be foreign intervention. We would also suffer in the hemi-
sphere and domestically by reawakening the Dominican Republic and
Czechoslovakia images.
One possibility of acceptable public action, however, would be
OAS concern in the event of a chaotic situationsee below.
B. Operational problems
1. Military assistance. We can be virtually certain that we will re-
ceive requests for equipment and arms. We can supply these through
MAP or covertly through third-country sources. We may well wish to
do both, but we should be ready to do so.
2. Economic aid. We will almost surely have to shore-up any re-
sulting government. We should therefore be prepared to move in mas-
sively with supporting assistance.
3. International. If the situation deteriorates or threatens to, a rela-
tively easily legitimized way of helping stabilize it is to seek OAS or
Inter-American Peace Committee action to mediate, arrange new elec-
tions, halt fighting. We should have contingency legal arguments and
proposals ready for this.
4. Recognition. The question of recognition may arise if the coup
occurs in such a way as to indicate clearly a new government has come
into existence. On the other hand, if military officers merely substitute
for cabinet ministers and convoke new elections, the legal fiction of no
extra constitutional change of government may be defensible. In any
event, recognition can probably be extended and coordinated with
other Latin American countries in a relatively prompt and acceptable
fashion.
378-376/428-S/80023
September 5November 4, 1970 283
107. Telegram From the Central Intelligence Agency to the
Station in Chile
1
Washington, September 21, 1970, 1648Z.
1. Task force has been established in Headquarters to provide max-
imum support to Station. If it becomes as effective as we intend it to be,
you will never again receive such a lengthy message of this nature.
2. As first act wish engage you in exercise to refine and coordinate
our thinking in regard [Track Two] so that we may begin with clear and
agreed objectives and courses of action. On perhaps untoward assump-
tion that Frei makes first move, which he must if [this operation] is to
succeed, we would like to have as crystalline understanding as pos-
sible, under circumstances, of events we are placing in train and what
steps we are to follow. This is essential if we are to move forward from
one event to another without a pause and Headquarters is to provide
you with intelligent and effective support immediately and within
days to come.
3. Purpose of exercise is to prevent Allende assumption of power.
Parliamentary legerdemain has been discarded. Military solution is
objective.
4. First and fundamental task is to induce Frei to take action which
will produce desired result. After this we get fuzzy since we have no
clear understanding of what we wish Frei to do other than lead military
coup himself, something we can hardly expect of this too-gentle soul.
We can wistfully aspire to have him act in manner which will not only
exacerbate climate for coup but which will actually precipitate it.
5. From your previous communications it our understanding that
Frei should:
A. Seek resignation of cabinet;
B. Form new cabinet comprised entirely of military;
C. Frei appoints Acting President;
D. Frei departs from Chile;
E. Chile has military junta which supervises new elections;
F. Frei runs in new election. With our help he wins. For reasons
noted in para six below this seems to be an imperfect understanding on
our part of what you have in mind. Please send us cable outlining ob-
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D21, Chile
Papers, Church Committee, August 12, 1975. Secret; Immediate. Released by Broe; au-
thenticated by Phillips. The text printed here contains bracketed excisions and insertions
to protect sources and code names. The unredacted text of this telegram is in Central In-
telligence Agency, Job 8000012A. See footnote 2, Document 94.
378-376/428-S/80023
284 Foreign Relations, 19691976, Volume XXI
jectives and course of events as you believe they should unfold if we
can influence them, always conditioned by the fact that we have to
keep our feet in the mud of practicality and our eyes on the stars.
2
Provide explanation of why you believe these are objectives we should
be following and, in separate paragraph, outline what actions you be-
lieve should be taken to achieve objectives.
6. Questions on para five above. A) Can Frei successfully inspire
resignation of his cabinet without a suitable pretext? Does pretext now
exist? If not can we create one? What should it be and what can we do
to bring it about? B) Does Frei have constitutional authority to appoint
Acting President? Would not Acting President be either Minister of In-
terior or President of the Senate? In event Minister of the Interior Frei
clearly should appoint projected coup leader as Minister of Interior so
that he can take over, constitutionally, when Frei resigns. (Please clarify
what would happen in the normal and constitutional course of events if
Frei resigns after appointing a military cabinet.) C) On Freis departure
from Chile, can an ex-President leave the country immediately without
permission of Congress and still be acting within constitutional limits?
Might it be preferable to have him remain in secluded retreat within
Chile?
7. Our preoccupation with having Frei act constitutionally is not
based on delicate sense of legality but on two realities: A) it might be
easier to induce Frei to take necessary action if his acts can all be
clothed entirely in constitutional termsfrom his selecting military
cabinet, to resignation, etc. and permitting only unconstitutional act to
be militarys refusal to allow Allende assume power; B) if [this opera-
tion] successful it may be that Freis chances of re-election and subse-
quent acceptance for six years as legal President of Chile would be
better if it can be shown that he, personally, never violated constitution.
8. Purpose this cable is not to test your tired nerves with yet an-
other bureaucratic exercise when immediate, drastic, and effective ac-
tion is required. Purpose is to give some focus to our efforts so that
every move made henceforth will fit snugly into an agreed framework.
Deprived of the presence of COS we forced use this method to come to
meeting of minds.
9. Therefore, at your discretion, please send us list of your objec-
tives, course of action you are and will be following and support you
expect from us, tasks that must be performed by us and you. You may
wish group these tasks into various categories such as: direct pressure
on Frei (courses of action); direct and indirect pressure on Chilean mili-
2
No reply has been found.
378-376/428-S/80023
September 5November 4, 1970 285
tary (courses of action); propaganda including encouragement to [San-
tiago newspaper] [2 lines not declassified].
10. We have 33 days in which to reach a crescendo of activity. If
you agree there is a need to do so, we solicit your support in making
this effort orderly so that we miss no bets and focus on issues at hand as
priorities warrant.
108. Backchannel Message From the Ambassador to Chile (Korry)
to the Assistant Secretary of State for Inter-American Affairs
(Meyer) and the Presidents Assistant for National Security
Affairs (Kissinger)
1
Santiago, September 21, 1970.
SITUATION REPORT
1. During the evening hours of 20 September, Ambassador Korry
conversed with Defense Minister Sergio Ossa about the situation in
Chile, analyzing steps that President Frei could take in order to precipi-
tate a constitutional crisis. In the intermission of an opera performance
on 19 September, Frei had suggested to the Ambassador that he and
Ossa get together soonest. The Ambassadors talk with Minister of
Economy, Carlos Figueroa, in the morning of 20 September, (previ-
ously reported),
2
had touched on the same pivotal issue and scanned
the spectrum of options still available. Both reports should therefore be
read in conjunction, bearing in mind that Ossa, by virtue of his cabinet
post, is obviously more conversant with conditions in the armed forces
of Chile.
2. The Ambassador and Ossa immediately agreed that time was
running out and that any planned moves would have to be speeded up.
Ossa expected Communist pressures to be building up, especially since
the Communists by now may be aware that some military move may
be afoot.
3. Ossa confirmed that President Frei had not talked to any
members of the high commands recently. He agreed fully with the Am-
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive; Eyes Only.
2
See Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 23.
378-376/428-S/80023
286 Foreign Relations, 19691976, Volume XXI
bassadors observation that the least the president could do was to ap-
prise General Schneider of the fact that a favorable parliamentary solu-
tion is no longer in the cards.
4. Whereas Figueroa had disclaimed knowledge of any discussion,
with Frei participating, about the resignation of certain cabinet
members to force a crisis, Ossa stated that this matter had been talked
about and that there was agreement among members of the inner
circle that resignations, if tendered, should be accepted. Frei, in ap-
proving the idea, had never indicated that he would follow suit.
5. Ossa told the Ambassador that he had personally broached the
issue of a cabinet crisis to General Schneider. The General had replied
that he would assume responsibility for filling certain ministerial va-
cancies, stressing that in so doing he would merely be acting in protec-
tion of the constitution by insuring tranquility while the remaining
electoral processes are unrolling. (Ambassadors Comment: It was clear to
Ossa and me that what Schneiders reply was meant to convey was
that, under any conditions, he would do nothing to prevent Allendes
election by congress.)
6. In discussing the assignment of officers to cabinet posts,
Schneider made it clear that he would assign the best and most talented
men available, thereby unavoidably destroying their military careers.
Schneider expressed a personal preference for the retention of Zaldivar,
Figueroa and Ossa in their capacity as experienced technicians.
7. In discussing likely candidates to fill vacated cabinet posts, Ossa
mentioned General Carlos Pratts as well suited for the Minister of Inte-
rior. His cooperation in any effort to stop Allende could be depended
upon. As regards General Schneider, Ossa considers him the strongest
single influence among the officer corps which, by and large, espouses
the constitutionalist line he propounds. The prevalent feeling among
the officers is that the politicians got Chile into the mess in which
she finds herself and that it behooves the politicians to extricate her.
Schneider therefore, would continue to be a problem, in his present po-
sition as well as in capacity of Minister of Interior.
8. Winding up their talk, Ossa and the Ambassador agreed on the
following courses of action:
Message from Ambassador to Frei:
I have encouraged many Chileans to stay on in Chile until at least
24 October, but I cannot be party to endangering any lives. Why should
I, as United States Ambassador, hold out hope to Chileans if the presi-
dent tells my Italian and German colleagues that he himself no longer
has any hope of an October 24 congressional formula.
If Frei chooses to continue playing self-pitying and inactive role,
history is bound to judge him harshly, (and not Allende or Tomic) as
378-376/428-S/80023
September 5November 4, 1970 287
mainly responsible for Chiles loss to Communism. It will be difficult to
conceal the record of his stewardship from world opinion which would
consider him the Kerensky of Chile. Freis only concern appeared to be
not to have to suffer the physical indignity of handing over the sash of
the presidency to Allende.
Frei should know that not a nut or bolt will be allowed to reach a
Chile under Allende (and that his recommendations to that effect, the
Ambassador is sure, will receive the support of the President of the
United States). Once Allende comes to power, we shall do all within
our power to condemn Chile and the Chileans to utmost deprivation
and poverty, a policy designed for a long time to come to accelerate the
harsh features of a Communist society in Chile. Hence, for Frei to be-
lieve that there will be much of an alternative to utter misery, such as
seeing Chile muddle through, would be strictly illusory.
Ossa voiced total agreement with the points made above and
promised that they would be conveyed in toto to President Frei.
9. Pressure on Military.
Ossa agreed with the necessity to bring home to the military now
already that inactivity in the face of threatening Allende victory would
spell a highly damaging reorientation in relations between the United
States and Chile. As an earnest of such intent, the Ambassador told
Ossa, oral messages would be sent to General Schneider and Guerraty
and to Admiral Porta, advising them that all MAP supported trips to
the United States will have to be suspended. Ossa declared himself in
complete accord with this proposed step.
10. Cabinet Re-Shuffle:
Ossa agreed to pursue actively the Ambassadors suggestion that
Frei be persuaded either to quit the country or to invite military partici-
pation in the cabinet in such a way as to offer Chile an option other than
Allende. If necessary, General Schneider would have to be neutralized,
by displacement if necessary.
378-376/428-S/80023
288 Foreign Relations, 19691976, Volume XXI
109. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 22, 1970.
SUBJECT
Chile
Attached are two cables from Korry through CAS channels.
2
I as-
sume you have seen them. In them Korry
Describes a confused picture, with some doubt that any plan of
action is agreed upon by anyone.
Describes himself in an activist role encouraging the military
formula.
Charlie Meyer wanted to send out a message to Korry last night
reining him in. Meyer is still under the opinion that we have agreed
only to encourage the Rube Goldberg political formula. He thinks
Korry is exceeding his instructions. I told him not to send any message
last night, and to check with Alex Johnson before he sent anything out. I
did not say anything to him about the meeting on the military alterna-
tive, nor do I think he is aware of either the meeting or the report that
Helms circulated.
There is a very awkward and possibly dangerous gap between
what you see as our policy and what Meyer and ARA understand to be
the policy. I believe this gap is sincerethey simply are unaware of
guidance existing that is any different from last weeks 40 Committee.
I recommend that you tell Johnson to tell Meyer what the mood is
in the White House so that ARA understands they may be on a dif-
ferent frequency. Otherwise they are going to cross wires. I have also
taken the precaution of saying we wanted to clear any instructions to
Korry in the 40 Committee line.
3
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive; Eyes Only. Printed from an uninitialed copy.
2
Document 108 and footnote 2 thereto.
3
Kissinger wrote, Good, in the left margin of this paragraph.
378-376/428-S/80023
September 5November 4, 1970 289
110. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Assistant Secretary of State for Inter-American
Affairs (Meyer)
1
Santiago, September 22, 1970.
1. I have received following message from General Mather on my
proposal to inform Chilean military that we are suspending MAP
training pending review after October.
a. I very much appreciate your message and the opportunity to
comment on the proposal contained therein. Similar actions taken in
comparable situations have proved ineffective and counterproductive.
In this particular instance, I would anticipate that the threat of our re-
viewing MAP training would not weigh too heavily on the Chilean
military as they contemplate intensely grave issues with respect to an
Allende government. From our suspensions of MAP in other countries,
they can probably forecast suspension and even termination of the pro-
gram eventually from one cause or another after an Allende accession.
Our suspension now as you suggest, however, could be taken either as
a sign of our abandonment of Chiles military or as pressure upon them
to do what they have apparently decided not to do; viz: rise against Al-
lendes taking office. I do not believe that our MAP program offers
enough leverage to compensate for either of those conclusions. More-
over, we have to contemplate possibility that word of such action
would become public knowledge and thereby bring U.S. Government
into more active role in present crisis than I had understood to be envis-
aged in current guidance.
b. I recommend in any case that the action you describe not be
taken without consideration and approval of State/Department of
Defense.
2. CINCSOs arguments are obviously well considered and carry
considerable weight. However, following points also bear on issue:
(a) proposal originated with my military advisors who are of unan-
imous view that Chilean Armed Forces have yet to understand with
any degree of clarity what an Allende government would mean to
them and their interests. Attaches and Military Group gave detailed
study to question and concluded that notice of suspension MAP train-
ing would have most favorable impact of anything we could do in
terms of awakening Chilean military to the prospects before them.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
290 Foreign Relations, 19691976, Volume XXI
(b) Minister of Defense Ossa and all those in Freis most intimate group
concur that Armed Forces must be prodded out of current somnolent
state if there is to be any chance to block Allende by any means. Ossa
believes, after checking with Frei, that proposed notification on
training would be highly effective and I respect their judgment, partic-
ularly if we did it with finesse. (c) As General Mather suggests, such a
move could have some damaging impact on our future relations with
Armed Forces, but I believe it need not if we communicate our decision
in an appropriately elegant way. Question here comes down to judg-
ment as to whether these relations would be really damaged, whether
such relations would have significance under Allende, and if so
whether any damage that might result could be repaired. I doubt that
Allende and PCCh would allow relationship to continue in meaningful
form and am also most dubious regarding militarys capacity or will to
brake the slide to totalitarianism. As for repairing the damage, there
should be no difficulty in dividing the action of an individual ambas-
sador, that most dependable of objects. In sum, as far as the Armed
Forces are concerned, I think it is probably now or never. (d) As Gen-
eral Mather also points out, leverage in our scanty MAP training pro-
gram is indeed limited. However, a larger message is involved. Armed
Forces all dependent to a critical degree on FMS and U.S. commercial
sources for spare parts, supplies and new equipment. If shut off from
us, Navy and Air Force would literally grind to a halt. Army is
somehow less dependent but has been interested in such items still in
FMS pipeline as 106 recoilless rifles. By signaling through MAP
training that relationship with U.S. is truly imperiled, we can draw at-
tention to these important factors. We know from reliable sources, in-
cluding Ossa, that military in surprising numbers believe that it will be
business as usual with U.S. Government under Allende. They should
be disabused of this notion.
3. There appears to me to be persuasive arguments in favor of
going ahead with notification. I do not contend, however, that such
would produce miraculous conversion to anti-Allende cause. In fact,
there might be little if any impact and perhaps some irritation; I simply
say that is worth the small risk involved, there is very little to lose and
perhaps something to gain.
4. One very important point made in my first messages after the
election that I wish to stress in this context: we must always seek to in-
crease our bargaining position with a President Allende even while
hoping he will not accede to the highest office. The military indirectly
can add to the pressures abuilding from many other quarters designed
to remind Allende that he cannot be totally disdainful of U.S. power
nor can he carry out his electoral program in any effective way if he
378-376/428-S/80023
September 5November 4, 1970 291
seeks to impose his will on us. (I am indirectly addressing this question
in an overall evaluation that will be transmitted via State today.)
2
5. One final point on operational detail: message would be care-
fully delivered by Military Group Section Chiefs in sorrow rather than
anger. Their line would simply be that coming of Allende to power . . .
(garble) . . .
3
Armed Forces, including assignments of personnel, and
that it seems best to us to wait until situation can be carefully examined
before proceeding with training that may be inappropriate or un-
wanted by the individuals involved. I do not expect in any way that
this message would become public knowledge since keeping it quiet
would be in interests of both Allende and Armed Forces.
6. Will appreciate your reactions and instructions as soon as
possible.
2
Telegram 3824 from Santiago, September 22, is Document 24 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973.
3
As in the original.
378-376/428-S/80023
292 Foreign Relations, 19691976, Volume XXI
111. Memorandum for the Record of a Meeting of the 40
Committee
1
Washington, September 22, 1970, 8:108:40 a.m.
SUBJECT
Chile
PARTICIPANTS
ChairmanHenry A. Kissinger
State
John Irwin, II
U. Alexis Johnson
Defense
David Packard
CIA
Richard Helms
Thomas Karamessines
JCS
Admiral Thomas Moorer
NSC Staff
Viron P. Vaky
SUMMARY OF DECISIONS
1. Mr. Johnson and Mr. Karamessines are to prepare a message to
Korry.
2. Mr. Johnson is to compile facts about assistance to Chile and will
discuss this again with the Committee.
Dr. Kissinger referred to two telegrams received from Ambassador
Korry which described (a) confused situation, and (b) his own role as
very activist.
2
He asked whether since Korry is an Ambassador he was
not doing too much and placing himself in an exposed position.
Mr. Johnson said he had not seen the telegrams. (Copies were
made and passed out to the principals.) After reading the messages,
Johnson said that Korry apparently has the feeling that the parliamen-
tary formula is dead.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 1970. Top Secret; Sensitive; Eyes Only. The meeting
took place in Kissingers office at the White House. Although the meeting was held on the
morning of September 22, it was originally scheduled for September 21. An October 22,
1971, summary of unrecorded meetings of the 40 Committee (see footnote 2, Document
92) states that the Executive Secretary did not attend this meeting due to illness.
2
Documents 108 and 110.
378-376/428-S/80023
September 5November 4, 1970 293
Mr. Karamessines, at the Chairmans request, gave a short briefing
on the situation. He described the activity of the Allende forces, the re-
luctance of General Schneider to make any move, and the crucial role
Frei plays. He also described propaganda activities we have under-
taken. He mentioned as problems: (a) the delicate question of whether
[1 lines not declassified] and (b) an Inter-American Bank loan of $4 mil-
lion to the Catholic University.
3
Mr. Johnson asked what it was we wanted Korry to do or not to do.
Does he need to be cautioned?
Dr. Kissinger said that he thought there were two poles to be taken
care of: first, Korry should be told that he should keep a low profile and
that he is not the man to be performing all of these activities; secondly,
Charlie Meyer needs to understand the Presidents view is not Tad
Szulcs views; that the President is eager to get this done. Both are
leaning too far in opposite directions.
Mr. Helms said that much of what Korry is reporting is, of course,
private conversation. His personal presence is not as evident as one
might infer.
Mr. Johnson asked if Korry had to be the spokesman.
Mr. Helms replied that the Station had been forbidden by the last
two Ambassadors to be in touch with Frei; consequently, they had no
assets and no channel to Frei. Korry had to do it.
Mr. Karamessines, in reply to the Chairmans questions, said that
he believed there was increasing concern in Chile and that Frei re-
mained the last chance if he could be encouraged. Asked what Frei
wants, Karamessines said he probably would like to be assured of sup-
port in another election. He might also like to be assured that the mili-
tary would be helped and not ostracized should they make any move.
Dr. Kissinger asked whether we could not get word to Korry to
pass as quickly as possible to Frei two points: first, that in any new elec-
tion he would have our support; and secondly, that the military should
know that they would not be ostracized if they were to act.
Mr. Johnson said that he and Mr. Karamessines would prepare a
comprehensive message back to Korry. He said he would also have a
talk with Charlie Meyer.
Dr. Kissinger said that the President wanted all aid to Chile cut off.
He had not taken action to implement this because he wanted a chance
to talk to the Committee principals. He asked whether we could not
turn the screws a little bit on MAP and AID.
3
Karamessiness briefing is described in greater detail in Document 112.
378-376/428-S/80023
294 Foreign Relations, 19691976, Volume XXI
Mr. Johnson said he would look into what the facts were, the pipe-
line, etc. and would be back.
112. Memorandum for the Record by the Deputy Director for
Plans of the Central Intelligence Agency (Karamessines)
1
Washington, September 22, 1970.
SUBJECT
Chile22 September 1970
1. At a meeting in Dr. Kissingers office at 8:00 a.m. this morning,
attended by Dr. Kissinger, Under Secretary of State Irwin, Alexis
Johnson, Dave Packard, Tom Moorer, Pete Vaky and Mr. Helms, I de-
scribed the general situation and our own actions as follows:
2
a. The Allende forces have been continuing their propaganda and
coercion efforts and threats. The Generals, while talking among them-
selves about the possibility of a coup, are clearly not about to do any-
thing unless Frei gives them the word. Contact with Frei has been al-
most entirely through emissaries between Frei and Amb. Korry. Amb.
Korry has clearly indicated to Frei through Ossa that the military
should move. There is general agreement that the parliamentary con-
traption is a dead duck. Newspapers and other media around the
world are picking up the problem of Allende and papers such as the
New York Times and the Post have carried editorials. We have been ac-
tive in much of the overseas press work, and American publications of
influence are important in overseas replay, particularly in Chile and
Latin America generally. [3 lines not declassified]. We note that USIA
and VOA have been putting out material which could be considered
pro-Allende and this should be watched. We also have noted through
State traffic that the Inter-American Development Bank has or will ap-
prove a $4 million loan any day now for the technical university which
is a hot bed of Marxism and whose radio is constantly on the air rabidly
for Allende.
2. There was discussion as to channels to Frei, and I pointed out we
do not have them because both Ambassador Duggan and Korry have
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile/
CIA 1970. Secret; Sensitive; Eyes Only.
2
See Document 111.
378-376/428-S/80023
September 5November 4, 1970 295
not wanted us to have them. I also pointed out that the military are
thinking twice about a coup since they believe that U.S. attitude might
be the same as it has been for the Greek Junta and they would have dif-
ficulty getting military aid and support. After some discussion, it was
agreed that Mr. Johnson and the State Department would draft a mes-
sage to Korry telling Korry to get the word to Frei that he will have our
support if he goes into an election as a result of a coup scenario, and
also passing the word to the military that they will continue to receive
military help from the U.S. if a military coup takes over.
Thomas H. Karamessines
3
p.s. Secretary Johnson also undertook to look into the Inter-
American Development Bank item and the USIAVOA matter.
Addendum
4
Washington, September 22, 1970.
Track II
When the meeting adjourned Mr. Kissinger asked me to stay be-
hind for a moment at which time I told him of our sending George
Donohue down today to see Frei and Ossa and to convey the very mes-
sages that will be conveyed by Amb. Korry but to assure Frei that if
necessary he will have twice the amount he had for the 1964 election
and also that military aid will continue. He is also to assure Frei that, if
Frei makes the effort and it fails, we will help Frei to get himself reset-
tled overseas if that is what he chooses to do. Mr. Kissinger said that
our handling of the problem during the earlier meeting had been per-
fect and he added we were doing fine and keep it up.
T.H.K.
3
Karamessines signed TH Karamessines above his typed signature.
4
Secret; Sensitive; Eyes Only.
378-376/428-S/80023
296 Foreign Relations, 19691976, Volume XXI
113. Backchannel Message From the Under Secretary of State for
Political Affairs (Johnson) to the Ambassador to Chile
(Korry)
1
Washington, September 22, 1970.
1. Today (22 Sept.) we considered what we understand is concept
that the military take over the government, control the militant leader-
ship of the UP, and offer the Chilean people a general election with Frei
as the candidate.
2. You are authorized to indicate clearly to Frei, through such
channels as you deem most appropriate and trusthworthy, that while
the decision to undertake such a course must be entirely Chilean, if the
above concept of action is undertaken Frei can count on our financial
support in his campaign, and that if the effort to block Allende from
taking office is successful the Chilean military can continue to count on
us for MAP support and a maintenance of our close relationship.
3. I continue to be concerned that you keep your profile on this
matter as lowas possible and that you keep strictly within your instruc-
tions unless and until they are modified. We are prepared promptly to
act on any recommendations you may have. Slug all messages on this
subject for my eyes only for me and Kissinger. I will assure that Charlie
Meyer and others who need to be are kept informed.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Chile 1970. Top Secret; Eyes Only. A notation at the
top of the page reads: By secure phone from Amb Johnsons office, 22 Sept. 1970,
d[ispatched] 1755.
378-376/428-S/80023
September 5November 4, 1970 297
114. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Assistant Secretary of State for Inter-American
Affairs (Meyer)
1
Washington, September 22, 1970.
1. My two parterSantiago 3824 and 3828 is based on a series of
conversations (too time consuming to report individually) that leads
me to believe I now have the situation well-taped.
2
Without disclosing
sensitive sources, it covers the closest advisors to Frei and it explains I
believe why I cannot answer the 40 Committees original instruction to
determine Freis exact reply.
2. I want you all to know of my profound awareness of the double-
track on which I have been operating and which I stressed from the be-
ginning: To do what I can to prevent Allende from assuming office
without incurring any risks for the USG and the President and at the
same time improve our bargaining position with Allende if he does be-
come president. This latter element is extremely important and it
happens to coincide with the priority goal.
3. I would suggest you consider repeating the two-parter to Euro-
pean posts.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
2
See Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 24 and footnote 1 thereto.
115. Backchannel Message From the Assistant Secretary of State
for Inter-American Affairs (Meyer) to the Ambassador to
Chile (Korry)
1
Washington, September 23, 1970.
1. We greatly appreciate your two-part message (Santiago 3824
and 3828)
2
describing the fast-moving situation in Santiago and how
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, 1970. Secret; Sensitive. Drafted by Hurwitch and
Little (ARA).
2
See Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 24 and footnote 1 thereto.
378-376/428-S/80023
298 Foreign Relations, 19691976, Volume XXI
you see the various possibilities which Frei is turning over in his mind.
Your complementary message of September 22 in this channel put the
other two messages in helpful perspective.
3
2. We have noted the several possible ways you describe that the
political forces might move so as constitutionally to block Allende from
taking power. We conclude, however, that both you and Frei have vir-
tually abandoned the hope that Alessandri could get enough votes to
be elected on October 24.
3. Your reporting, including both the two-part message and others
from your DAO,
4
indicate that the military seek, above all, a constitu-
tional way out and hope somebody else will provide the means. They
appear at the same time to be edging toward some moral justification
for thwarting Allende. We are unclear, however, as to the relationship
of this new military awareness of the danger of Allende taking office to
the scenario which would result in entry of military officers into the
cabinet. How do you visualize a military-dominated cabinet, oriented
toward constitutionality, frustrating an Allende assumption of power
on October 24? Would not Frei and his lieutenants then be up against
the same wall mentioned in the paragraph abovethat is, lack of votes
in the Congressor is there some other formula which could be
worked out whereby constitutionality could be maintained while
3
Document 110.
4
The DAO reporting refers to Defense Attache cables DATT 250, 251, and 252 from
Santiago, September 22, all in the National Archives, Nixon Presidential Materials, NSC
Files, Box 777, Country Files, Latin America, Chile, 1970. DATT 250 cites the Commander
of the Chilean Air Force Guerraty as stating that, Chilean armed forces plus carabineros
are prepared to step in and take over govt if they can find legal excuse to do so. Guerraty
explained that over the long term the armed forces have imbued their personnel with
the ideal of constitutional legal behavior, and that troops of all services would not re-
spond unless legal pretext exists. Guerraty admitted that the Allende govt would de-
stroy armed forces as they presently exist within six months. The DAO concluded:
This information is a complete reversal of all the info we have received concerning mili-
tary reaction to elections. It is first indication that Chilean military apparently not living
in the dream that all would be business as usual under a Marxist govt.
DATT 251 reported a discussion between the Army Attache and the head of
Chilean Army Intelligence, outlining the Chilean Army concern that the Unidad Popular
was attempting to encroach on the military before Allende was legally elected President.
The General also expressed hope that President Frei would persuade the PDC to deny Al-
lende the presidency. The Army Attache noted that his contact, like many other Gen-
erals, is looking for an easy way out of a difficult situation. He continues to believe politi-
cians will resolve present situation and, although aware of the consequences of a
Communist govt, he is reluctant to take any action. As a result these Generals may well
placidly allow the Communists to assume control of their country and eventually the
armed forces without lifting a finger.
DATT 252 reported on a conversation with a member of the Chilean Navy General
Staff. The Staff member said that Allende was moving very fast to gain control of the
country and it appeared as if the military was the only obstacle in his path to success, but
the military needed a moral and constitutional excuse to stop the Marxists from assuming
control of the government. Concern was expressed that if Allende were elected, material
support and training from the United States would end.
378-376/428-S/80023
September 5November 4, 1970 299
preventing Allende from taking over? We would appreciate any
thoughts you have as to the scenario which might be involved in such a
formula.
116. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 24, 1970.
Ref: Santiago Nodis 3872.
2
1. Appreciate UnderSecs message.
3
However, no necessity for me
to give any assurances of any kind to Frei since I have emphasized from
start that whatever he does will be Chilean and only Chilean. Only re-
quests GOC has made have been reported. They have been limited to
propaganda and now (see below) diplomatic.
2. Embassy profile is at zero level and no repeat no risks of any
kind have been taken. Frei has been receiving my suggestions that are
clearly personal and within the framework of my instructions. I still
have my doubts about a coup and still have greater hopes it will be a
typical Chilean-type kaffee klatch solution. Embassy operates under
strictest orders to seek no contacts of any kind and only to receive those
who seek us. In some cases we are very dissuasive and the situation is
under as tight a control as is humanly possible.
3. GOC and everyone here, including me, hoping for a reversal of
Allende victory would also welcome a reversal of Departments posi-
tion of diplomatic non-action with our friends, particularly British
whose influence here is not inconsiderable and whose weight is being
thrown to Allende with very damaging effect.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive; Eyes Only.
2
Dated September 23. (National Archives, Nixon Presidential Materials, NSC Files,
Box 774, Country Files, Latin America, Chile, Vol. II)
3
Document 113.
378-376/428-S/80023
300 Foreign Relations, 19691976, Volume XXI
117. Draft Backchannel Message From the Under Secretary of
State for Political Affairs (Johnson) to the Ambassador to
Chile (Korry)
1
Washington, September 24, 1970.
Ref: .
2
1. We are puzzled by reference message, especially second sen-
tence of paragraph 1. We had assumed that offer of financial support to
Frei if things worked out so that he could again run for presidency
would encourage him to take whatever action is going to be required to
block Allende from taking office. We had also assumed that assurance
to Chilean military that they would not be ostracized by us but could
rather count on us for continued support if they participated in this ef-
fort would also be encouragement to them, and we are puzzled that
you make no reference to this in your reply.
2. While we reiterate our position that the decision to undertake
any such course of action must be entirely Chilean, and that you should
keep your profile on this matter as low as possible, you should be clear
that we hope the Chileans will find a way to block Allende from taking
office. We had hoped and expected that the assurances you were au-
thorized to give by our previous message would serve this end. If you
do not believe they will do so, please let us know soonest, together with
any recommendations you may have. We are urgently considering
what we can do with respect to the recommendation contained in para-
graph 3 reftel.
3. Do you feel that the bait of becoming UNSYG is acting as a re-
straint on Frei and, if so, what thoughts do you have on how we might
deal with this.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, 1970. Top Secret; Eyes Only. A notation at the top of
the page reads, Copy to Vakyhard copy envelope copy Haig (?) file. The message is
in draft format, and there is no indication that it was sent. No other version was found.
However, the comments made by Korry cited in Document 120 respond to it, suggesting
that it was sent. Also at a meeting of the 40 Committee on September 24, Karamessines
recorded, there was discussion of Ambassador Korrys response to the message sent
yesterday and it was agreed around the table the response was inadequate and incom-
prehensible. Ambassador Johnson undertook to send a new message on his own. There
was discussion of the British position and it was agreed that Mr. Kissinger would see
whether the President might mention this to the Prime Minister during his forthcoming
trip. (Memorandum for the Record, September 24; Central Intelligence Agency, Job
780717BA, DDP Chron File, JanuaryDecember 1970)
2
Although no reference number is included on the draft, the reference is appar-
ently to Document 116.
378-376/428-S/80023
September 5November 4, 1970 301
118. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Washington, September 24, 1970.
1. DAO cable Chilean Military Looking for Way Out
2
resulted
from unsolicited information provided to Chief of Military Group, Air
Force Section, by Chilean Air Force CINC. Latter called former to his of-
fice on a pretext and poured out his talk. Our man properly reported to
me and to Air Attache who quite naturally felt compelled to inform
DIA. Neither Attache nor Air Force Section Chief are aware of what is
going on under the surface. Attempting to stop this kind of reporting
would obviously create problems and suspicions. DAO messages will
continue to be reviewed in advance by DCM and myself, but we are re-
luctant to cut off normal reportingwhich will naturally reflect to
some degree state of play in Chilean Armed Forcesunless matters of
extreme sensitivity creep up. In that regard, fact that some in Chilean
military would like somehow to find a legal way out is widely known
here.
2. I have given our military (except Army Attache) strict instruc-
tions not to seek out their contacts and to make no other efforts to
gather sensitive intelligence during this period. These instructions are
being followed. However, whenas in this caseour people are
sought out, they have no choice but to listen. You can be sure we will
continue to keep the profile just as low as possible.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
2
The reference is to message DATT 250. See footnote 4, Document 115.
378-376/428-S/80023
302 Foreign Relations, 19691976, Volume XXI
119. Memorandum From the Presidents Deputy Assistant for
National Security Affairs (Haig) to the Presidents Assistant
for National Security Affairs (Kissinger)
1
Washington, September 24, 1970.
SUBJECT
Chile
Attached is the latest message from Korry on the situation in
Chile.
2
I think he has a good point in paragraph 3. However, I would
feel much more secure if this were done at the highest levels with the
governments concerned and on a priority basis. This is precisely the
suggestion made by the Chilean Congressman to me.
3
He was most
concerned about the following countries:
1. The German Government, whose ties and influence in Santiago
are strong and pervasive.
2. The Italian Government which, as you know, has major emo-
tional, psychological and empathetic influence in Chile.
To the foregoing I would add Great Britain based on Korrys own
recommendations.
My fear is that if Korry were permitted to romp around, the Am-
bassadors concerned would merely have to consult their governments.
It would therefore be far more appropriate to first discuss it with the
governments concerned at the highest level and then, assuming they
are sympathetic, give Korry authority for local liaison.
The Congressman made the following additional points which I
am sure you have covered in your previous discussion, but which I am
listing here as an assist for todays meeting:
4
Frei is a good but weak man who needs constant pushing and
reassurance. It is especially important that he knows that the United
States stands behind him.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, 1970. Secret; Sensitive; Eyes Only.
2
Document 116.
3
No substantive record was found of the meeting between Haig and the Chilean
Congressman, beyond that which is described here. On September 18, pro-Alessandri
Senator Pedro Iban ez met with Nachmanoff. Iban ez made nearly identical points as those
recorded here by Haig. Furthermore, a note attached to Nachmanoffs September 18
memorandum, reporting his meeting with Iban ez to Kissinger, stated that Haig had also
seen Iban ez as Kissinger requested. (National Archives, Nixon Presidential Materials,
NSC Files, Box 777, Country Files, Latin America, Chile, 1970)
4
The 40 Committee met on September 24. See footnote 1, Document 117.
378-376/428-S/80023
September 5November 4, 1970 303
For your eyes only, Korry is not an especially effective Ambas-
sador. His views have been troublesome and, though he is an intelli-
gent man, he is fundamentally an idealist and a journalist and hardly a
realistic Chief of Mission.
Those who are involved in our work should be assured of both
money and safe-havens and provision should be made now to provide
these. I would suggest that CIA be charged with confirming that this
has been done with a specific plan which can be used by Korry to reas-
sure his contacts.
We should give immediate consideration to unleashing the
business community in New York on this subject [less than 1 line not de-
classified]. According to the Chilean, there are ample resources which
can be made available immediately and which can be used to accom-
plish a great deal in the way of influencing fence-sitters and those
members of the Chilean Government who may be purchaseable.
A real effort should be made now through our military attaches
in Santiago to work on the Chilean military rather than to sit on their
hands and add to the doubts of the Chilean military. We must assume
that our military representatives in Chile can best judge their style and
approaches. They should, however, be armed with authority to convey
at least promises of stepped-up, post-coup military support, materiel,
hardware and funds and, as a minimum, strong moral support for the
kind of action which must be taken.
Consideration should be givenas Pete [Vaky] mentioned ear-
lier
5
to sending a hard-nosed, low-profile, yet nonetheless authorita-
tive representative to Chile to orchestrate what must be done and who
will be able to convey special authority and influence in this regard.
When I asked the Chilean whether or not economic difficulties
contributed to, or complicated, Allendes chances, he replied that, on
balance, subtlely applied economic problems posed Allende with real
problems and tended to raise concerns about the drift toward Marxism.
The Chilean emphasized that since the election, Allende has
consistently lost support. He said that an effective program, managed
and controlled by a realistic and enlightened U.S. coordinator, offered
the best hope for success.
The Chilean concluded that the foregoing suggestions came
from him only with the greatest reluctance and agony, but that he was
convinced that risks had to be taken and that if Allende were to be in-
stalled, Chiles demise was certain and that while initially talk of com-
promise and modus vivendi would be employed, ultimately as soon as
necessary strength was assembled, democracy would be promptly
5
See Document 95.
378-376/428-S/80023
304 Foreign Relations, 19691976, Volume XXI
eliminated and a large base for subversion elsewhere would be
established.
Finally, the Congressman emphasized that rumors of massive
Soviet aid, military equipment and reasonable treatment invariably are
used to placate doubters.
120. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 25, 1970.
1. Before offering comments and recommendations, one more fact:
PDC technicians weighing their futures have gone this week to Com-
munist Deputy Jorge Insunza, to MAPU Deputy Silva Solar and to
MAPU leader Chonchol, the latter two ex-PDC, to inquire about their
chances of leaving Chile after November 4. The Communists said they
had learned from Cuba they could not permit loss of nations brains
and the other two had said there would be no closing of frontiers but
the red tape blocks would be very formidable.
2. I have sought to provide as much mobility [and] as many op-
tions as I could for Frei and for Chile in protection of U.S. interests here,
in the area and beyond. Frei has fulfilled most of my suggestions; he
has created an environment in which something could still happen,
particularly if sparked by a declining economic situation. But he has
not moved beyond stage-managing to playing the decisive role and he
will not.
3. He would welcome the U.S. doing his dirty work for him by
seeking to provoke a military coup. Aside from the merits of a coup and
its implications for the U.S., I amconvinced we cannot provoke one and
that we should not run any risk simply to have another Bay of Pigs.
Hence I have instructed very strongly our military and CAS to engage
in no encouragement of any kind.
4. One of the in people on that abortive operation, may I ungra-
ciously insert here, was my predecessor in this post, Ralph Dungan,
1
Source: National Security Council, Intelligence Files, Subject Files, Chile, 1970. Se-
cret; Sensitive; Eyes Only.
378-376/428-S/80023
September 5November 4, 1970 305
whose article in the Washington Post yesterday
2
has had profound effect
today, particularly on the PDC. It is interpreted quite accurately as a
vote for Allende and as an earnest of U.S. support for what some call a
fascinating experiment. I shall comment via State channels on Dungan
eventually but I would only note for the moment that his plea for
non-intervention and USG maturity is from the same voice that is re-
garded universally in this country as the single greatest intervener in
the history of our relations and the organizer of the massive interven-
tion to stop Allende in 1964.
3
5. But rather than wring my hands A La Frei about Dungan or
other problems, let us move to the next challenge: How to create a sit-
uation in which the task of imposing a Marxist-Leninist structure is
made more difficult for Allende and how to attain this goal while but-
tressing our leverage in the difficult negotiations with him. As stressed
from the outset of this crisis, these objectives have always been upper-
most in my mind and convergent with the not-yet-moribund effort to
block Allende.
6. Lest anyone imagine that we have time for more serious reflec-
tion and decision, I stress that what we do now, and I mean tomorrow
and every day until October 24th, will affect the longer-term objectives
as well as the immediate one. Indeed, if done effectively and if, by
Providences hand, it were to mesh with other local events, our actions
could help to block Allende before October 24th.
7. Popular Unity will come to power as an inherently unstable co-
alition, afflicted from the outset by ideological differences, political
opportunism and corruption, incompetence and inevitable administra-
tion confusion. Its partners range from fanatic and violent revolution-
aries of the Castroite stripe (left wing of the Socialist Party and the MIR)
to a notorious group of political thugs and thieves (Senator Tarud and
the Radicals). Its decision-making machinery including a projected
high-level policy council with representation from all U.P. groups, is
likely to function in the creakiest of fashions; its economic and manage-
rial expertise in key positions is likely to be mediocre or worse. These
problems can be overcome as Allende and his Communist partners
gradually gain control. But meantime Allendes GOC will face the crit-
ical problems of making a fairly complex economy and government
work, while delivering on promises of revolution and a better life for
all.
2
See Ralph A. Dungan, Chile: Test of American Maturity, New York Times, Sep-
tember 23, 1970, p. A22.
3
For the proposal to influence the 1964 election see Document 250 in Foreign Rela-
tions, 19641968, vol. XXXI, South and Central America; Mexico.
378-376/428-S/80023
306 Foreign Relations, 19691976, Volume XXI
8. It will be during this periodperhaps six to nine monthsthat
Allendes Popular Unity will be most vulnerable. If the economic and
administrative problems are sufficiently severe, Popular Unity could
crumble. If they are unable to cope, the Unity could dissolve, the
revolution turn into chaos and the peoples support for their gov-
ernment melt away. This is the scenario that would unite the army and
set the scene for effective, popularly-backed military intervention.
9. The PDC is preparing for that dayat least some of the healthier
elements by worsening the economic situation [less than 1 line not declas-
sified] and by buying up a mass of media outlets from frightened or
hard-pressed Alessandrista elements. [name not declassified] advice is as
much directed to that slightly longer-term aspiration as it is to the im-
mediate one of stopping Allende.
4
10. If one large enterprise here were to shut its doors next week, if
one bank were to fail, if one savings and loan association were to col-
lapse, we would still have life before October 24th and we would be
contributing to the chaos that has its natural yeast in any case.
11. I see no risks in pursuing with U.S. companies in the U.S., par-
ticularly if one totally discreet leader were selected (may I suggest the
name of [name not declassified], the suggestions put forward by [name not
declassified]. For U.S. companies it would be naturally prudent to take
precautionary measures and even more in one or two cases, particu-
larly since all the hard intelligence on Allendeand that includes his
talks with the PDChas him saying unequivocally that all foreign en-
terprises are to be nationalized. The question for the companies is
whether it will be the first or second year of Popular Unity and whether
they get any effective compensation. For the vast majority of U.S. com-
panies that will be affected, Chile is not the costly problem; rather it is
the effect on Argentina and the rest of Latin America and beyond.
12. May I cite one funny detail in support. [name not declassified]
called in the representatives of Shell, ESSO, and the Chilean COPEC
company yesterday. He used a pretext but his message according to the
ESSO man was very clear: The economic situation is bad and it would
be good if it got worse. It was handled with the usual cleverness of my
good [less than 1 line not declassified] friend (whom I have not seen and
who until this week was listed as less than 100 per cent anti-Allende)
[name not declassified] took aside the Shell man (a Chilean) to ask why in
Hell he could not control the British ambassador.
13. The economy will tend to turn up if a conscientious effort is not
made to have it go down. People will start to buy in normal terms once
4
Korrys conversation with [name not declassified] is related in Document 25 in For-
eign Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
September 5November 4, 1970 307
they believe Allende is definitely the president. That is why the Allende
forces are pushing so hard and fast for PDC blessing now. However
[name not declassified] will cooperate in blocking an upturn if there is
any possibility to do so legitimately and in some cases, illegitimately.
14. Some objectives we could support without repeat without
showing the USG hand are the following:
a. Let the business community know about the unlikelihood of any
exit for technicians and managers and professionals after November
4th. It is a matter of semi-public record. The fewer the brains, the more
difficult the management problem for Allende.
b. Stop bank credit and as much other credit as possible.
c. Give the widest distribution to the bleak Zaldivar analysis.
Business executives would influence banking and other respected
journals to diffuse this message widely and quickly.
d. Consider having one large U.S. company fold up. Ford has a
perfect justification for doing so and it is doomed. General Motors
should not try to hang on to get a taste of the new poison by bringing in
spare parts by air as it did this week. The Bank of America is almost
bankrupt here; why should it hang on?
e. Mention specifics in any propaganda that the business commu-
nity (again I caution not the USG) can spread. The two savings and loan
associations I mentioned in Part I (Calicanto and Casa Chilena) and the
Banco Hypotecario (an Alessandrista group that is the No. 1 target of
both PDC and U.P.) are on the ropes and only need a very slight shove.
f. Persuade Anaconda in the current negotiations with its unions to
accede to their demands. Anaconda could suggest that a U.P. econo-
mist be present at the negotiations, perhaps Vuskovich the Allende li-
aison to Zaldivar and the future MinEconomy. After all, Allende said
publicly after the election that copper workers were vastly underpaid
and the Chuquicamata mining area (Anaconda) voted against Allende.
It is natural for the GOCs 51 per cent management (all PDC) to cede to
their wishes and give a whopping big raise that would have all other
workers in the country clamoring for one.
14. In the most discreet fashion possible, the Treasury should as-
certain and provide (us too) the amount of Chilean Governments
dollar holdings in the U.S. I have in mind for longer-term useon No-
vember 3 or 4 to be precisethe blocking of Chiles assets in the U.S. I
recognize that such a proposal is very hairy indeed and that it would
represent a form of economic warfare against Allende. But the justifica-
tion would be the almost immediate nationalization of copperAl-
lende has said he would do it November 5and the unlikelihood of
any effective compensation. Chilean reserves might be 200 to 300 mil-
lions in the U.S., in fact, most of its hard currency cushion. A U.S. freeze
378-376/428-S/80023
308 Foreign Relations, 19691976, Volume XXI
would put Allende to the wall from the start. It should be, needless to
say, very carefully considered by the minimum number of people at the
highest levels of the government.
15. Finally it would of course be very helpful to have some early
Washington agreement among credit-giving agencies. Our proposal is
to hold in abeyance any fresh U.S. credits. My reasoning is that our ex-
posure is very large indeed already: $800,000,000 in aid guaranties;
$800,000,000 in A.I.D. and EXIM loans and more than a billion if not
two billions in replacement value of U.S. enterprises. I see no reason to
grant any further credits until we know Allendes intentions.
16. In this connection it would be very helpful if we could get some
wider Washington agreement on how to deal with the Allende contin-
gency. The Embassys paper sent to ARA/AP July 24th (The Allende
Contingency) spelled it out clearly.
5
But today for example AFTAC,
the Peace Corps, AID and almost every agency here has come up with
essential reasons for doing business as usual. These parochial attitudes
complicate our problems enormously. Today for example, Dr. Seaborg
from Vienna informed us that he had told the Chilean delegate to the
IAEC general assembly that the U.S. would of course honor its commit-
ment to deliver enriched uranium fuel (of bomb-making capacity) to
Chile within the next few months. Did anyone clear this? If so, what
was the logic? (Vienna 5484)
6
17. We shall seek to provide very shortly the elements in the PDC
requests to Allende that he does not wish to make public and we shall
be equally alert to any other possibilities that can produce the imme-
diate and longer-term impacts we want:
a. To make the army more suspicious of Allendes intentions.
b. To make the media (and public) more alert to encroachments
and to inspire more resistance.
c. To make the consumer more doubtful about the economy and
less willing to spend.
d. To make the PDC and other moderate elements more conscious
of their role as guardians of Chiles democratic traditions and structure.
5
Not found.
6
Telegram 5484 from Vienna, September 24, is not printed. (National Archives, RG
59, Central Files 197073, POL 14 CHILE)
378-376/428-S/80023
September 5November 4, 1970 309
121. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Santiago, September 25, 1970.
Ref: Korry Message of 24 September 1970.
2
1. I know that Frei assumes the U.S. will support him; that has been
made perfectly clear. Therefore, there is no need to say the obvious,
particularly if it were said, it would eventually leak and we would be
the scapegoat more clearly defined than the rumor campaign is seeking
to paint us in any case. Let me cite one illustrative example as a further
clarification of Part I, Paragraph 5, of my second message dated 24 Sep-
tember 1970.
3
I am now certain that Frei and Perez-Zujovich have had
a falling out of some kind and that Perez informed his co-political
workers that the U.S. had offered money. As soon as I had word of this
rumor I called Raul Troncoso, MinState at the Moneda. Although cab-
inet meeting was taking place then (Wednesday afternoon) he immedi-
ately called Perez who called me to emphasize that he had said it the
other way roundthat his co-workers had been seeking money from
the Embassy. In fact I have some good reason to believe he is lying and
that he is so terrorized that he is seeking to save his skin with some kind
of deal with Allende. In any event, and much more significant, Frei left
the cabinet meeting ten minutes after my call, got in touch with those
same co-workers who had met with Perez to request that they continue
their efforts to win the junta.
2. As for the military, they are getting the message from Ossa and
others that U.S. Milaid will be cut if Allende has his program. That is a
much more effective message than an attempt to buy them with the
meaningless promise of continued MAP programs when the latter
have been reduced almost to the vanishing point. (I understand that
total MAP for LA has been reduced from $77 million in 1967 to about $7
million this year and that we can plan here on level of less than $500
thousand in future.) The military will react much more to the negatives
than to any positives. Moreover I do not wish to get into the game of
trying to buy them off since the exposure factor in this loose-tongued
society is very great. They would resent what they consider bribery and
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Top Secret; Sensitive; Eyes
Only.
2
Document 116.
3
Korrys September 24 backchannel message is Document 25 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
310 Foreign Relations, 19691976, Volume XXI
they would react negatively to it. They assume that there will be U.S.
Milaid even in the event of an Allende government with guaranties.
For the foregoing reasons I had wanted more negatives such as the can-
cellation of visits to underscore the bleak future.
3. I do not believe Frei has any realistic expectations re the UNSYG
and I believe this gimmick to be a ValdesTeitelboim bait that was
swallowed long ago by the Chilean ambassador to the UN, Pinera, a
screwball by any definition.
4. One new item. I have slept on my proposal of last night re Ana-
conda (Paragraph 14 d of message dated 25 September 1970)
4
and have
decided to reverse field. In dealing with the shorter-term problem of
stopping Allende, it would be advantageous for the company to hold
firm to its current offer of a 38.5 per cent increase in wages; I believe the
GOC would support the tougher line since they would like nothing
more than a strike at this point. Unidad Popular orders are to avoid
strikes at any cost. I would welcome the Allende camp telling the
workers that their demands of more than 60 per cent are excessive and
that they should be reasonable. I would expect that the tough-
minded miners would be split wide open and that long or short term,
such a development would leave deep scars. I have talked to my very
cooperative friend who now heads Anaconda in Chile, Krest Cyr, and
stated the hypothetical advantages of playing hard or soft. I think he
will recommend the hard approach to his company. However, Ana-
conda New York has a traditional record of doing the wrong thing and
I guess would prefer the soft approach. Therefore, if a business inter-
mediary such as the one I suggested could be promptly located he
could deliver the suggestion to Anaconda in New York.
5. In that connection the equally cooperative ESSO is demanding
prompt payment from General Tire for a very large outstanding bill.
They will cease delivery of the raw material Monday if the bill is not
paid, either in kind (tires for their dealers) or in cash. ESSO believes the
plant might be forced to shut by Tuesday.
6. I have spoken again to the First NCB manager here and asked
why he has failed to fulfill the commitment of his NY vice president
Weaver who was recently here re El Mercurio and why they are putting
Mercurio to the wall. I told him I would not like to apprise the White
House of this strange action that could only have the effect of muzzling
the lone free voice in Chile but I would do so today. He said he would
promptly change his tune with Mercurio. I also told him I could not un-
derstand how he could continue to be giving credits such as to the Ales-
sandri paper company when the U.S. exposure was so great and that I
4
Document 120. The paragraph indicator is in error; the correct reference is para-
graph 4f.
378-376/428-S/80023
September 5November 4, 1970 311
intended to communicate this equally strange symptom to the atten-
tion of the White House. He said he would promptly reconsider the
matter.
Post-Script: Date for strike decision for Anaconda is mid-night
September 30 although few days of extra bargaining possible if both re-
peat both parties agree.
122. Transcript of a Telephone Conversation Between the Under
Secretary of State for Political Affairs (Johnson) and the
Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, September 25, 1970, 8 p.m.
K: I am leavingyou will be delighted to know.
2
J: When, now?
K: In another hour or so. I wanted to touch some bases with you.
On the situation we were discussing yesterday afternoonnot the one
in which our guidance was so scrupulously followedthe other one. I
think he [Korry] has flipped his lid!
J: I am thoroughly baffled. Charlie [Meyer] is coming back in the
morning. Tom Karamessines man is coming in tomorrow afternoon. I
want to get together with him.
K: The only immediate action that I remember is to try to get them
to turn off water in some places.
J: That doesnt change anything. I looked into the question of aid.
We are doing nothing new. We have projects in course down there. Al-
most all of the disbursements are obligatedwe are not obligating any-
thing new. Most are to American companies.
K: How about the MAP program?
J: There is not anything$500,000. I get ittrying to read all that
stuffwhat he is saying is that he just doesnt see any mileage in trying
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 364,
Telephone Conversations, Chronological File. No classification marking.
2
Kissinger traveled to Paris to talk with South Vietnamese President Thieu and
Vice President Ky and to have a secret meeting with North Vietnamese negotiator Xuan
Thuy.
378-376/428-S/80023
312 Foreign Relations, 19691976, Volume XXI
to frustrate . . . now he is talking about how we make trouble for him
[Allende] once he gets in.
K: I know nothing about it. Why dont we at least see what we can
do about cutting off those water funds? I mean these international
institutions.
J: I am told they are making no loans. He goes up and down. One
day he wants to make a big settlement and the next day he wants them
to go on strike.
K: Can you sort of take over the 40 Committee while I am gone?
J: Lets say I will do my best on it.
K: I will have Haig sit in for me. If you can have one or two
meetings to say that something is reasonably being done.
[Omitted here is discussion unrelated to Chile.]
123. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Santiago, September 26, 1970.
REF
Korry Four Page Message dated 24 September 1970
2
1. Source cited Paragraph 8 (yesterdays) reftel saw Frei at noon
today to inquire about FreiAllende meeting Wednesday night in
Valdes home. Frei vehemently denied it adding Allende had gone to
Valdes home. Frei would give no details on AllendeValdes meeting.
(U.S. business community reps report Valdes spreading word that Al-
lende should not be regarded as Marxist but more as a radical with
whom business can be transacted.)
2. Frei admitted to source that it did not look as if he could win
party junta or enough votes on October 24 (as source had insisted) but
that he had not totally given up.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
2
See Document 25 in Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973.
378-376/428-S/80023
September 5November 4, 1970 313
3. Source suggested that bringing military into cabinet was only
way to block Allende. Frei agreed but said that once military was in
government how could he be sure at this time they would do anything
more than assure Allendes victory.
4. Same source called on Perez Zujovic last night who insisted he
still working on winning control of party junta for Frei and that at min-
imum he wanted to roll up big opposition vote against acceptance of
Allende. Added that his strategy was to convince junta that PDC
should be given key ministerial posts in Allende government as only
sure guaranty. Perez said Senator Carmona had taken his place as main
Frei massager with PDC senators and deputies.
5. Another excellent source quoted Esteban Tomic, son of candi-
date who has recently returned to Foreign Ministry from campaign
train, as stating yesterday that it would not be bad if PDC split, that the
party would be purified. I believe that Tomic senior favors this solution
and also one of loudest exponents of the Italian model theory whereby
Chile proves you can have Christians of the left, Communists and So-
cialists in one happy bridge-building brigade. He seems to ignore to-
tally that PDC would disappear as political force. In fact Tomic is now a
total MAPU manthat is, proselytizing for Chonchol, Gumucio and
Silva Solar. (MAPU pulled a maximum of one per cent in the presiden-
tial elections for Allende but they have lots of attraction for youth.)
6. I continue to believe Frei is keeping all options open, that he is
injecting yeast into different mixes and seeing which ones risemili-
tary, economic or party. For the moment that is the best he can do since
I think the essential conditions do not yet exist to have the army move
and that a popular justification is necessary. A close vote in the PDC
junta in favor of Allende would not be as helpful as a vote against Al-
lende but Frei is working for at least the minimum since a worsening
economic situation after the junta (scheduled October 34) could still
affect the October 24 ballot. A minimal vote for Allende October 24 in a
secret ballot even if more than his 80 sure votes could still spark a mili-
tary reaction after October 24th if the economic conditions were right
and a worsening economy could in turn provoke at any time the kind
of leftist violence that would prompt greater army intervention and
concerns.
378-376/428-S/80023
314 Foreign Relations, 19691976, Volume XXI
124. Backchannel Message From the Ambassador to Chile (Korry)
to the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 27, 1970.
1. Following two items spell the end of the ball game here in Chile.
We now move into a denied area condition:
a. [name not declassified] told me morning 27 September that Ana-
conda New York has refused to go along with his suggestions, be-
lieving that Chile is lost and no further maneuvering warranted. He got
call at 0200 hours saying ball game over. No use trying to quarterback
now.
b. British Ambassador Hilyard told me same morning that he had
recently requested, and had just received authorization to offer, a total
of four million pounds sterling from a group of British private banks.
Hilyard has told both present government and Allende of this credit.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 778,
Country Files, Latin America, Chile, Vol. I, Korry File. Secret; Sensitive; Eyes Only.
125. Backchannel Message From the Ambassador to Chile (Korry)
to the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 28, 1970.
Reference: #12870.
2
1. Ref message unfortunately was sent in not quite accurate form
due to relay under difficult circumstances. Following is what I had in
mind:
2. Because of Anaconda decision and British offer of 4,000,000
pound credit, I see little hope unless economic situation worsens. That
could still happen. But in order for it to occur, I need support from
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 778,
Country Files, Latin America, Chile, Vol. I, Korry File. Secret; Sensitive; Eyes Only.
2
Document 124.
378-376/428-S/80023
September 5November 4, 1970 315
Washington that until now has not repeat not been forthcoming in any
effective manner.
3. It is puzzling to me to understand how anyone could think that
an offer to maintain our MAP Program of a few hundreds of thousands
of dollars could be a significant factor while we make no effort to dis-
suade either the largest U.S. enterprise in the country (Anaconda) or
our supposed ally (UK) from taking critical actions to ease Allende into
office. It took three weeks for USIA to send a circular asking for mate-
rial about the encroachments on the freedom of press, by which time
the Communists had called off the strong-arm tactics because they rec-
ognized that the international furor could hurt Allende. Instead the Al-
lendistas are concentrating on much more subtle methods in every en-
terprise of any importance in the country, primarily through their
Popular Unity electoral apparatus that is very swiftly supplanting the
normal union and professional structure.
4. Because I have no optimism about any Army move or any ex-
pectation of the biological miracle of transplanting a backbone to the
PDCunless there is economic deteriorationI believe it prudent to
have CAS begin moving into a denied area stance. This is not to say
that I believe the ball game is over; it is designed to clarify your
thinking and that of a bureaucracy in Washington that appears to be as
clear-minded, purposeful and united as the PDC here.
5. It is an absurdity for me to continue to seek by every means to
block Allende without U.S. Government support; because man is an ab-
surdity I shall of course continue my efforts since I believe it is not nec-
essary to hope in order to act or to succeed in order to persevere, but I
would appreciate the company of at least a few who shared this absurd
view.
378-376/428-S/80023
316 Foreign Relations, 19691976, Volume XXI
126. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, September 28, 1970.
1. Guillermo Carey, Jr., of Anaconda, told Krest Cyr September 27
(presumably to relay to me) that a group of military persons, exclud-
ing the top military leaders, are prepared to launch a coup if they
can be given the following three assurances (presumably by the U.S.
Government):
a. A sum of U.S. dollars 50,000 (as received) is set aside to take care
of each of the families of the ten leaders should anything go wrong.
b. The sum of 200,000 to 300,000 Escudos (less than (US$10,000) is
made available for special items to be obtained in Argentina.
c. Sufficient food such as wheat and other staples will be made
available to feed the populace of Chile in the aftermath of the takeover.
2. Cyr was uncomfortable to be the carrier of this sort of message
but gamely asked if I had any response to this proposal. I said there was
no answer. I reminded Cyr that I had told U.S. business community
Friday that rightists were trying to foment coups and that Allendistas
might be pushing them into abortive actions that could only seal Al-
lendes victory. Cyr said he had asked Carey about this and Carey re-
plied he was aware of the danger.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
September 5November 4, 1970 317
127. Memorandum for the Record
1
Washington, September 29, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 29 September 1970
PRESENT
Mr. Mitchell, Mr. Packard, Mr. Johnson, and Mr. Helms.
Mr. Kissinger was out of the country.
Mr. Charles A. Meyer, Mr. Viron P. Vaky, and Mr. Thomas Karamessines were
also present.
Chile
a. Alexis Johnson chaired the meeting in the absence of Mr. Kissin-
ger and opened by saying that he had called the group together to re-
view the bidding. He noted that several of those present had been able
to talk with Chief of Station/Santiago, [name not declassified], over the
weekend.
b. Mr. Johnson asked if all agreed with the following summary:
The initial hope of the election gambit with Alessandri stepping down
and Frei replacing him and calling for new elections was now dead.
The second best hope of the cabinet resigning and being replaced with
militarya sort of in-house coupalso seemed dead, since Frei and
the military were passing the responsibility buck back and forth be-
tween them.
c. This brought up the Country Team suggestion that by raising
the noise level with specific economic pressures there was at least some
chance that such signals might be viewed with sufficient alarm to
prompt action by the military.
d. Mr. Johnson said that it wasnt entirely clear how the reins
would be turned over to the military in a constitutional manner as had
been suggested. Mr. Vaky said what we were really talking about was a
coupalthough that word might have various shadings.
e. Mr. Packard said he felt that the situation was serious enough so
that the need to act now was imperative.
f. The coup was pictured by those thinking aloud as Chilean action
with the U.S. as catalyst. We would assure Frei of future financial sup-
port; we would convey to the military that they would not be ostra-
cizedthey could count on our continued support and cooperation (as
opposed to a complete cutoff if Allende came to power).
1
Source: National Security Council, Nixon Intelligence Files, 40 Committee
Minutes. Secret; Eyes Only. Drafted on September 30. Copies were sent to Johnson, Vaky,
and Helms.
378-376/428-S/80023
318 Foreign Relations, 19691976, Volume XXI
g. It was emphasized that there would be no military action as of
this moment unless these economic pressures were put into effect.
Failure to make signals at this time strengthens Allende day by day
he can point to the USA not opposing him at all.
h. Mr. Mitchell asked for an inventory of possible economic ac-
tions. Mr. Karamessines ticked off a series of possibilities. [8 lines not
declassified]
i. Urging some [less than 1 line not declassified] to act now would
provide definite leverageabout the only leverage we could exact
and the signals would be unmistakable, most agreed. There was also
the MAP program, which could be abruptly cut.
2
j. Mr. Johnson observed that this approach, swerving from 40
Committee-type action to economic warfare, was tantamount to a
change in foreign policy. Mr. Mitchell suggested it was economic
protection.
k. [1 paragraph (5 lines) not declassified]
l. Mr. Karamessines stated that this parcel of economic pressure ac-
tions constituted the only cards left in our hand. Mr. Mitchell asked
what was there left to lose.
m. Mr. Meyer regretted that the U.S. posture if Allende wins (the
subject matter of NSSM 97) had not been issued. It contained three op-
tions: to isolate Allende; to make him the victim of all ensuing actions
rather than the USG; to openly cohabit with him.
3
He went on to say
that with Allende in, we could place the burden on Allende for all he
didnot ourselves, and after all, Allende would not be around forever.
n. This prompted Mr. Helms to observe that in his experience he
had seen other take-overs where pronounced Marxists had accom-
plished in far less than six years (Allendes constitutional term) what
they had threatened to do and then there were no more elections. He
said we should face up to Allendes statements and take them at face
value.
2
Assistant Secretary of Defense for International Security Affairs Warren Nutter in-
formed Packard on September 22 that the MAP grant materiel program had been termi-
nated at the end of FY 68, with a $2.5 million undelivered balance from the prior years
programs. Major undelivered items included a patrol craft, radios, ammunition, and
spare parts. Nutter reviewed the current program of $583,000 for training in the United
States and the Canal Zone, and for insignificant cash sales under the Foreign Military
Sales program. Credits for military sales for the period of FY 19661969 had an out-
standing balance of $13.6 million. Major undelivered FMS items under the credit pro-
gramincluded sonars, helicopters, 20 M41 tanks, and 25 106mmrifles. The Department of
Defense was also withholding action on a major overhaul of a naval crane until the situa-
tion in Chile was resolved. (National Archives, Nixon Presidential Materials, NSC Files,
Box 774, Country Files, Latin America, Chile, Vol. II)
3
See Documents 46 and 52.
378-376/428-S/80023
September 5November 4, 1970 319
o. Mr. Johnson said he would play the devils advocate and inter-
jected that using U.S. economic interests to frustrate Chilean constitu-
tional processes could have far-reaching effects in jeopardizing other
U.S. interests in the hemisphere. Mr. Karamessines pointed out con-
trariwise that a hands-off policy could be read as the USA throwing in
the sponge.
p. Mr. Packard repeated his earlier thesis: This is serious enough so
we should act now. He offered to stop the MAP program.
q. Mr. Meyer referred to what he considered earlier ground rules
of not giving signals until after the 24th.
r. After this give-and-take, back-and-forth exchange, the principals
agreed to these actions:
(1) Mr. Packard would (a) act to stop the MAP program, and
(b) check on the status of AFTAC pulling out.
4
(2) Mr. Johnson would talk with [name not declassified] formerly
with [less than 1 line not declassified] intimating that if indeed they in-
tended to withdraw, it would be helpful to the USG if they did that now
rather than later.
(3) Mr. Meyer would: (a) talk to [1 line not declassified] (b) [2 lines
not declassified] (c) talk with [1 lines not declassified] (d) talk with [1
lines not declassified] and (e) [1 lines not declassified].
This was the extent of the specifics but, of course, did not preclude
others in the administration from talking to other U.S. business in-
terests in Chile.
s. Mr. Meyer reminded those present that the private sector did not
always think or act in concert with particular U.S. policies at a given
time and one had to consider the local impact of actions taken by U.S.
companies overseas.
t. Mr. Karamessines reiterated that Ambassador Korry urged eco-
nomic actions of this type at this time and Frei was in full accord.
u. Lastly, the matter of Dr. Seaborg announcing the passing of en-
riched uranium to Chile in support of an experimental reactor (U.S. or-
igin) was raised. Mr. Johnson stated that he had long-term involvement
in the problemof retaliation on political grounds in the field of peaceful
uses of atomic energy and the South African experience had convinced
him that this was not a wise course.
Peter Jessup
4
The proposal that the AFTAC facilities be removed was in telegram 3848 from
Santiago, September 22. It noted that the AFTAC facilities would be a prime target for Al-
lende propaganda. (National Archives, RG 59, Central Files 197073, DEF 15 CHILE) See
also Document 120.
378-376/428-S/80023
320 Foreign Relations, 19691976, Volume XXI
128. Backchannel Message From the Under Secretary of State for
Political Affairs (Johnson) to the Ambassador to Chile
(Korry)
1
Washington, September 30, 1970.
1. In response to your recommendations, we have taken the fol-
lowing steps in the economic and financial field, which where neces-
sary we have justified on the grounds of the economic uncertainties an-
nounced by the Chilean Finance Minister:
a. The implementation of the SLC loan on cattle is being deferred
for later review.
b. Only major EXIMBANK loan is to steel company which we un-
derstand from you is being deferred.
c. We are instructing EXIMBANK to reclassify Chile from C to
D so as to restrict and centralize normal credit insurance transactions.
d. Any new IDB loan will be deferred.
e. I discussed Bank of America situation with senior official in San
Francisco office, who said that while they were restricting additional
credit lines, they had no intention whatever of seeking to close out
Chilean operations. I made it clear that we did not think their future
would be bright under Allende. I hope I gave him something to think
about, but we certainly can expect no action before October 24.
f. Charlie Meyer has talked to Ford Motor who are perfectly aware
that they cannot continue to operate, having lost more than $25 million
to date but it will take them time to extricate themselves.
g. Charlie Meyer will talk with Harold Geneen about uncertainties
in private sector.
2. DOD is taking action to suspend MAP-sponsored trips and
training and instructions on this will follow.
3. We are doing our best on external press coverage program but
by its nature this takes time.
4. We have emphasized to VOA importance of completely bal-
anced coverage.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 778,
Country Files, Latin America, Chile, Vol. I, Korry File. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
September 5November 4, 1970 321
129. Telegram From the Central Intelligence Agency to the
Station in Chile
1
Washington, September 30, 1970, 2019Z.
1. Reviewing COS discussions at Headquarters, following three of-
ficers are key figures in military planning, and priority effort will be
made to contact and influence:
A. [name not declassified] understand Station now in touch through
[name not declassified].
B. General Valenzuela.
C. [name not declassified].
2. We should make it clear to these officers individually now that
political solution ruled out, USG shares President Freis view that mili-
tary solution is only answer.
3. Next step is to attempt reunion of [less than 1 line not declassified]
together. They are to be assured that USG will provide the support and
pledges they demand, and welcomes indications as to the dimensions
of such support.
4. Other military figures, who might play decisive roles will be ap-
proached when possible. COS will use [less than 1 line not declassified]
and false flag staffers at his discretion.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile
Papers, Church Committee, August 12, 1975. Secret; Priority. Drafted by Broe; authenti-
cated by Phillips. The unredacted text of this telegram is in Central Intelligence Agency,
Job 8000012A. See footnote 2, Document 94.
378-376/428-S/80023
322 Foreign Relations, 19691976, Volume XXI
130. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, October 1, 1970.
SUBJECT
Chile
There are fundamental differences among operating agencies as to
how Allende is to be perceived and what the US interest in this situa-
tion is. Most of these are honest differences, but they are differences.
The truth of the matter is that no policy decision on how to treat or
perceive of Allende has been made or articulated in a way which the bu-
reaucracy can perceive or understand. I have not been privy to all that has
gone on. If opinions or orders have been expressed, they have not
trickled down. I affirm to you that at lower levels of the bureaucracy
there is honest confusion and honest belief that no final decisions have
been made. In an ambiguous situation, operators who have to make
daily operational decisions will do so on the basis of what they think
they ought to do. And since there is a variety of opinion regarding what
ought to be done, there are a variety of decisions without coherent pat-
tern. This is even more true when you consider agencies normally pe-
ripheral to foreign policy formulation such as AEC, NASA, Ex-Im
Bank, all of which have operations in Chile.
How we are to perceive and treat Allende is particularly crucial
now, because:
it is increasingly the central point whether we are talking about
what to do prior to October 24 or what we do if Allende comes to
power;
everyone agrees that the chances of Allende being denied access
to power is considerably less than even; put in reverse this means that
there is a considerably better than even chance that we will have an Al-
lende government in Chile in a month. Yet we have no thought-out
strategy and no game plan for that contingency;
there are an indefinite number of complex little decisions that
will have to be made in the next several weeks. A sample list is at-
tached.
2
We commissioned NSSM 97 precisely to determine a conceptual
premise and general posture for dealing with Allende which would in
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Country
Files, Latin America, Chile, Korry File, Chile 1971. Secret; Eyes Only. Sent for action.
2
Attached but not printed is a September 18 memorandum from Fisher to Meyer
listing 18 items in U.S.-Chilean relations that would require action in the near term.
378-376/428-S/80023
September 5November 4, 1970 323
turn be expressed in the little operational decisions we had to make.
The bureaucracy looks to that paper as the vehicle by which decisions
will be made.
3
We stand vulnerable to the charge that we did not reach policy de-
cisions through the reasoned NSC system of examination of the situa-
tion and alternatives on which we have prided ourselves.
Recommendation
That you have the SRG meet on NSSM 97 as soon as possible and
that a Presidential decision be explicitly made on the issues, either
through a memo or a full NSC meeting.
3
See Documents 46 and 52.
131. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, October 1, 1970.
SITREPOctober 1
1. Allende rejection of PDC is major development. Although leftist
press seeking to present Allendes response as positive as trumpeted
by all his considerable assets in media, they cannot bury PDC leader
Prados statement that reply was unsatisfactory.
2
Allendes tactic
does provide a political lever we have been seeking from the outset. But
I have my doubts that Frei or the PDC Junta can be persuaded to take
the step that Benes turned away from in 1948.
2. To provide additional pressure for that step and to strip away
any illusions, I informed Minister of Defense Ossa this morning [1 line
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive; Eyes Only.
2
On September 30, Allende issued a statement rejecting PDC demands that he re-
frain from naming military commanders, as well as PDC demands for constitutional
amendments guaranteeing free elections and freedomof the press if he were elected Pres-
ident. The PDC National Council called his response not a complete and satisfactory an-
swer. (Joseph Novitski, Allende Rebuffs Some Demands of Chiles Ruling Party as Un-
necessary, New York Times, October 1, 1970, p. 4)
378-376/428-S/80023
324 Foreign Relations, 19691976, Volume XXI
not declassified] that if Allende wins, the U.S. will not repeat not be in a
position to provide any financial support to the PDC for any activity.
In other words, a negative reply to Freis and Ossas query about U.S.
support for the purchase by their group of newspapers and radio sta-
tions, etc., for the post-Allende period. Frei and the PDC have too long
counted on the U.S. turning the other cheek and although I have done a
great deal to end the mutually debilitating link that my predecessor
forged with fatal damage to both, I wanted them to know before the
Junta that it is now or never.
3. I also provided Ossa with a dispatch that I concocted under a
Reuters June 3, 1948 repeat 1948 London dateline for translation by him
and distribution to the PDC Junta of the events that led to the Commu-
nist takeover of Czechoslovakia. Ossa was told the dispatch came from
Reuters archives. (It would take Reuters months to search its files and
even then it would never be certain of what it sent in the pre-microfilm
era. Moreover it will give my active British colleague a useful addi-
tional responsibility.) The dispatch begins: The Communist Party has
imposed a dictatorship on Czechoslovakia less than three years after its
leader Klement Gottwald pledged to maintain a parliamentary democ-
racy. Here is the sequence of events:
4. Today is October 1 when a great many bills come due
throughout the economy. How enterprises and the GOC react to the
conflicting pressures will have additional significant impact. But the
uncertainty created by the negative Allende response will not in my
opinion provide incentive to the public to reduce its enormous li-
quidity and begin buying.
5. The Chuquicamata (Anaconda) miners went out on strike at
midnight today. The fact that the GOC did not soften is very indicative
and heartening. It followed a message that I sent Ossa the morning of
September 29th to the effect that Anaconda was willing to cede because
of GOC pressures on it to cede but that the company would follow the
GOC line. It is interesting to note that Minister of Mines Hales, previ-
ously considered doubtful, is now playing his role loyally with Frei.
6. We shall have shortly the eight points that the PDC presented to
Allende but has hid from the public at Allendes request. These must be
leaked, I think I could handle a local leak with the overly cautious NY
Times man (Novitski) who is writing pap generally but my preference is
a very strong effort by you to get them to the U.S. pressan exclusive
to the Washington Post would be my suggestion (I am sending a sepa-
rate message re the Post to Helms.)
3
They will also be made available to
Mercurio here.
3
Not found.
378-376/428-S/80023
September 5November 4, 1970 325
7. In this connection I am sending as much unclassified material
via State so as to ease the leakage problem. See Santiago 4022
4
today on
the PDCs statement re Allende and also the daily press sitreps I have
begun yesterday with Santiago 4014.
5
Todays will include the fact con-
tained in Santiago 3956 that Freis intervention at Vina del Mar is still
totally unreported in the media, the most telling indictment of the muz-
zling of the press.
6
8. I have just read in the press clips Tad Szulc Times story of Sep-
tember 21
7
which clearly indicates that one of his prime sources is
Linowitz and I would make the further guess that Dungan is also a
source. I believe it useful to have them spread the word of U.S. non-
involvement since that was also my purpose in the pre-voting and
post-voting sessions I had with the U.S. press here. As a consequence
we do not have any effective U.S. reporters in town and that is a great
blessingNovitski being the only one who remained once the news-
men were convinced we were not going to intervene. However it is of
the utmost importance that the two ex-ambassadors not have the
slightest whiff of what is going on except through the unclassified
cables mentioned above and that the USG continue to give the appear-
ance of confronting quietly the inevitabilities.
9. While hoping for the best, we continue to prepare for the worst.
We have sought to establish a position compatible with Option Two in
the Allende contingency paper prepared by the Department for the
NSC
8
cool correct and pragmatic. Our contacts with Chileans are the
minimal possible but the Chileans are educating Allende about the re-
alities of Chiles dependence on the U.S. I believe the time has come to
consider when I should come to Washington for meetings to set our
policy and tactics. I would suggest that barring unexpected develop-
ments, I travel early next week and that all appropriate meetings be ar-
ranged with policy-makers. At the same time I think it would be useful
that I be made available for off the record questioning by key congres-
sional and senatorial groups and editors for the purpose of providing
reassurance about U.S. non-intervention while furnishing some of the
true non-polemical facts about what is actually occurring in Chile.
4
Telegram 4022 from Santiago, October 1, reported that the PDC National Council
had declared the Allende response to their request for democratic guarantees to be unsat-
isfactory. (National Archives, RG 59, Central Files 197073, POL 12 CHILE)
5
Dated September 30. (Ibid., FN 9 CHILE)
6
Telegram 3956 from Santiago, September 28. (Ibid., E 14 LAPC)
7
See Tad Szulc, U.S. Government and Business Resigned to a Marxist Chile, New
York Times, September 21, 1970, p. 2.
8
Summarized in Document 52.
378-376/428-S/80023
326 Foreign Relations, 19691976, Volume XXI
10. The actions taken by Washington as detailed in your message
of September 30 are helpful.
9
I think that the unclassified cables men-
tioned above provide a basis for conversations with Geneen and others
whose views and actions could buttress our efforts here.
9
See Document 128.
132. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Santiago, October 5, 1970.
1. Ambassador has received messages re MAP
2
but because press
of other business will be commenting later Sunday. Meanwhile he
wishes you to know following:
2. He met for 90 minutes with Lleras Restrepo Saturday night in
presence of Colombian Ambassador. Unfortunately Lleras had spent
Friday night and all Saturday with Frei and impact of Ambassador
Korrys conversation means Lleras will have to seek out Frei. He will
do so. Lleras single greatest foreign influence on Frei.
3. He met with Paul Rosenstein Rodan who confirmed delivery of
personal letter to Frei from both Betancourt and Jacques Maritain (ab-
solutely no repeat no usage yet possible of this information). Latter
who is Freis ideological Guru told Frei that PDC must oppose
Marxism; Betancourt even stronger. Rosenstein Rodan supposedly
meeting with Frei Sunday and will press same message together with
specific action suggestions that Ambassador Korry put to Lleras.
Rosenstein also meeting with his very close friend Lleras to press same
line.
4. He met with Raul Saez just prior to Lleras dinner with Saez Sat-
urday night. Saez pressed same lines. Saez contacting Ossa late Sat-
urday or early Sunday with specific action suggestions for Frei and
Ossa.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
This backchannel message is an advance summary of Ambassador Korrys activities on
Saturday, October 3.
2
Not further identified.
378-376/428-S/80023
September 5November 4, 1970 327
5. Most important suggestion of course is to insist on removal of
current PDC leadership and replacement (by Junta) with loyal Freistas
who will make negotiation tough for Allende. Also effort to convince
Frei to take finally a decision that shows his own hand: to talk to
Junta tomorrow if this Junta going to be last before October 24th or to
commit himself to address it at final session whenever it will be. Also to
change Freis line re unwillingness to run as presidential candidate in
event Alessandri chosen (only to resign).
6. He will report later Sunday on what actually occurred PDC
Junta Saturday. Meanwhile these facts should be known:
7. Allende is furious over Chuquicamata strike. He wishes it ended
ASAP.
8. Allende nephew who private businessman quietly telling a few
influential non-marxists that Castro advised Allende to keep relations
with US whatever the cost and to negotiate acceptable deals with US.
9. Felipe Herrera is not repeat not seeking foreign ministry but
asking for post as super-economic czar with control over all economic
and financial activities of cabinet and GOC of Allende. Herrera with
connivance of Vuskovich has been arranging for very distinguished
group of hemispheric economists gathered here to consider Prebisch
report (conference starts Monday) to call on Allende but Ambassador
believes he has arranged for delegates to insist that if anything along
that line occurs, it would be reverse of Allende calling on conference.
10. Prebisch has criticized Herrera privately (in Washington in
presence of Rosenstein Rodan and again here) for his message to Al-
lende and other unseemly actions.
133. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Santiago, October 5, 1970.
1. My travel suggestion predicated only on situation here be-
coming clearly definite re Allendes election. As originally put to you, if
Junta took different tack, I would remain.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
328 Foreign Relations, 19691976, Volume XXI
2. Re MAP, my suggestion would be to hold in abeyance all
MAP deliveries.
2
I would avoid even within USG term suspension.
The action, I recognize, is exactly the same, but I believe it would be
very imprudent and would create greater support for Allende if we
were to adopt a visible public repeat public posture of hostility at this
point by semantical inadvertence. While even Allende would accept
that it is logical for the US not to throw good money after bad without
our knowing the future, and while I have been putting into circulation
in the Allende camp the explanation that US credits in the private
sector are tight because of simple commercial prudence, it would be il-
logical and resented by a wide swath of non-Marxist Chileans for us to
anticipate Allende by making the first public hostile moves. In sum
public repeat public prudence is understandable; public hostility is not.
3. In this connection, I had originally recommended the holding in
abeyance of all MAP-sponsored Chilean military going to the US or
Panama for training. The one officer who was planning to leave at that
time for a year in Panama, the Deputy G2 of the Air Force, left a week
ago. There are none other immediately scheduled but I would like to
inform the Armed Forces and the Carabineros that the next-scheduled
courses are being held in abeyance pending firmer knowledge of the
future course of relations between our two countries. Such a decision
would be transmitted to the Armed Service chiefs individually and in a
manner calculated not to breed their resentment against us.
4. In general my counsel would be to follow the tactics of Allende
and the PCCh with the Christian Democrats insofar as our dealings
with them and Chile are concerned. We should for the time being
present an unperturbed exterior while minding the interior by propa-
gating facts to the world and while improving our position vis-a`-vis Al-
lende. We should even consider sending a normal delegation to his in-
auguration while being damned tough in our private negotiations and
while keeping maximum pressure on him and his economy. We
cannot, as I told Lleras Restrepo, help a country to establish a Marxist-
Leninist structure in the most comfortable way possible via our sup-
port, direct or indirect, public or private. But we cannot be pushed into
the public position of seeming to oppose changes per se in economic
and social structure; it is freedom and the USSR that are our justifiable
concerns. So far we have been successful in pursuing this dual policy
here and, I assume, in Washington. It should not be changed for the
present.
2
See footnote 2, Document 127.
378-376/428-S/80023
September 5November 4, 1970 329
134. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, October 5, 1970.
SUBJECT
40 Committee MeetingChileOctober 6, 1970
Your meeting will review the Chilean situation.
The meeting should concentrate on two general issues:
Action prior to the October 24 runoff, and
What policy we should follow for the long range; and on one spe-
cific question:
Korrys suggestion that he come to Washington.
I. The General Situation
Allende has continued to consolidate his position. On the political
front, after an initial rebuff by his coalition (UP) of the PDCs request
for specific guarantees, Allende quickly reversed the UP and offered to
name a committee to negotiate with the PDC on the drafting of specific
constitutional guarantee they desire. This offer was made on the eve of
the PDC governing board meeting, and thereby cut the ground out
fromunder the anti-Allende forces. The PDC meeting is still underway.
All observers agree that at best there will be a split in the PDC, that
there is no chance the PDC will unify against Allende, and that Allende
is almost sure to get the 19 additional votes he needs from the PDC to
assure his election. There is no evidence that the military are even
thinking about a coup. The latest report via the Argentine Foreign Min-
ister (see cable attached)
2
is that the military, in fact, declined to stage a
coup.
Other scenarios which had been reported whereby some ministers
would resign, the President name a military cabinet, and new elections
convoked have not materialized.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Top Secret; Sensitive; Eyes Only.
2
Attached but not printed is telegram 2237 from USUN, October 3, relaying the fol-
lowing message from the visiting Argentine Foreign Minister: President Frei had, as
forecast in earlier report, called in leaders of Chilean armed forces and in effect invited
them to take over before expiration his term. They had, however, categorically refused,
stating that they are not equipped to govern the country and that an attempt to do so
would lead to widespread strikes and disturbances by miners and other labor elements
with which they would not wish to cope.
378-376/428-S/80023
330 Foreign Relations, 19691976, Volume XXI
Economic problems continue and there is some discontent. The
Communist Party is reportedly moving to consolidate its position in
public media, education and labor.
There is, in short, confusion, much apprehension, but no cohesive
anti-Allende movement. On the contrary, resignation or acceptance of
Allende seems to be growing.
II. Preventing Allendes Accession to Power
Immediately after the September 5 election, Korry stated that our
only chance was the Rube Goldberg Frei reelection gambit. By 19
September this gambit was dead. Korry argued in effect that now our
only chance lay in Frei inviting the military to move, either directly or
by a gambit of entering the cabinet. By the end of September the cabinet
gambit was clearly out, and if the Argentine report is to be believed any
military move is out.
Korry now argues that our only chance is to create economic dete-
rioration and this might stir up Frei, the military or the populace.
Korry has argued that only Frei can pull off anything and he is
moving behind the scenes to do so. In alternate cables, however, he de-
cries Freis lack of backbone. The fact of the matter is that Frei refuses to
move or lead any action. Korry is grabbing at straws, but each one
breaks when he grabs it.
In my own view there is now no chance that anything will happen
which we can either stimulate or support to prevent Allendes election
October 24. Maybe if things had been done differently over the past
several months this would not be the case, but as of October 6 I think we
are kidding ourselves to believe there are any more gambits that we can
work. Not even economic deterioration is likely to achieve such a dra-
matic turn-around in less than three weeks. Economic pressure might
make sense from other points of view (see below) but not solely as a
means of preventing Allendes election.
Unless we are prepared to intervene overtly and physically in Chile we
had better start planning for an Allende election and how we deal with that
situation.
III. Coping with an Allende Government
In my view there is some chance that within the first year of his ad-
ministration an Allende government could be brought to collapse or
that a Chilean inspired movement could overthrow him. Apart from
that, I think that there is at least a very good chance that an Allende
government could be effectively hampered, and that we could effec-
tively limit the impact of his government on the rest of the hemisphere.
But to do anything means we should have agreement as to con-
cept, objectives, strategy and a carefully orchestrated game plan. We
378-376/428-S/80023
September 5November 4, 1970 331
have none of these things now. We are improvising. There is no agree-
ment as to our fundamental perception of Allendedo we accommo-
date, oppose, or ignore? Do we let him set the pace or do we?
Allendes game plan will be to claim legitimacy and respectability,
to avoid prematurely coalescing opposition to him, to reassure those
concerned so that he can fragment his opposition and then slice the sa-
lami bit by bit as he is able to. Our game plan should be to frustrate that.
We should strengthen opposition, seek to coalesce it and inhibit Al-
lendes internal capacity to effect his program, and place pressures on
him so that he either fails or out of frustration steps up his drive to a
Marxist state prematurely. Opposition and opportunities may then
well arise which could be exploited to overthrow him; or else he will
fail.
Meanwhile, we should begin to provide some leadership to the
rest of the hemisphere to organize them against his tactics in the OAS
and to limit his influence elsewherea diplomatic cordon sanitaire.
A game plan might be devised along the following lines:
1. Covertly.
Bank-roll PDC/Radical opposition in the congress so that they can
oppose his programs; bank-roll opposition media so Allende cannot
control the press; build up assets in labor and the military both to get
information and to use if the opportunity arises; black operation to split
Socialists from Communists.
2. Economic.
Cut aid; use economic pressure to discourage further investment
and assistance by international agencies. Miscellaneous measures to
put pressure on himcopper marketing.
3. Diplomatic.
Cold but correct on the surface toward Allende so we do not give
him an excuse to escape our pressures.
Make clear quietly we do not accept Allende or his policyhe has
to prove acceptability not prove his unacceptability.
Wind down our bilateral programs.
Initiate immediate consultations with key statesArgentina,
Brazil, Colombia, Mexico, Venezuelato build a de facto entente and
to make known our concerns; seek concerted action to oppose any
Chilean move to wreck OAS, recognize Cuba, or establish a third force
in Latin America opposed to us.
But we must recognize that we cannot energize the hemisphere to
support us without some evidence that it is in their interest to do so. We
may thus have to consider increased military and economic aid and
378-376/428-S/80023
332 Foreign Relations, 19691976, Volume XXI
special trade treatment. We cannot with one hand ask for their support
and with the other hit them where it hurtsas we are threatening to do
now in prohibiting Argentine meat imports and taxing Brazilian sol-
uble coffee.
In my view we need a policy decision on NSSM-97 and a controlled im-
plementation of that decision.
IV. Korrys Return.
In his October 1 Sitrep, Korry suggests that time has come to travel
to Washington to participate in meetings to set our policy and tactics.
He proposes to meet with policy makers, to speak off the record to key
congressional and senatorial groups and editors.
3
My own view is that he ought to stay in Chile for a while longer until we
have our own ducks in a row at least. I doubt that his lobbying all around
in his unguided-missile way is likely to be helpful right now.
3
Document 131.
135. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, October 6, 1970.
SITREPOctober 5
1. Santiago 4079 sent unclassified on PDC Junta results.
2
2. Santiago 4087 which I just completed gives interpretation. Last
paragraph offers only remaining constitutional hope and that is
slimmest.
3
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive; Eyes Only.
2
Dated October 5. (National Archives, RG 59, Central Files 197073, E 5 LA) The
pro-Allende faction of the PDC Junta prevailed over the anti-Allende group. The Junta
decided the party would not impede Allendes inauguration.
3
In telegram 4087 from Santiago, October 5, Korry reflected on the PDCs decision
to negotiate constitutional guarantees with Allende. Korrys final paragraph surmised:
Thus, we are faced with the likelihood of several suspense-packed days as PDC spe-
cial commission negotiates text of guarantee statute with the Allende camp; this will
378-376/428-S/80023
September 5November 4, 1970 333
3. Sending septel to you [with] something on Army that might be
straw in wind although no supporting evidence elsewhere.
4
4. First paragraph Santiago 4087 based on my telcon with Frei last
evening in effort to convince him to appear at Junta. Only other fact un-
included (sic) for reason of discretion is that he said he had very much
in mind William the Silents line. He was totally beaten and depressed
man and I could not snap him out.
5. Paul Rosenstein-Rodan (British citizen at MIT) whom I had go to
Frei earlier October 3rd to try instill some fight thought he had success
in persuading Frei to attend a 2nd Junta if there is one (see last para-
graph 4087). Also provided Frei with a rationale for declaring himself
National Unity candidate in second round with National Government
for only three years and if unsuccessful in fulfilling goals, he would
then resign.
6. I am convinced that I turned Lleras around and that he will
weigh in again with Frei. Difficulty is that he must backtrack and that
in interim he may be seeing Allende and have second thoughts.
7. Economic situation about same as last week. Too early to judge
reaction to PDC Junta but my guess would be that it will have de-
pressing effect on commercial community. Chile does great deal of its
business on short term notes many of which are being protested at
banks. Process of protesting usually takes ten days before creditor de-
cides whether to roll over debt or foreclose. Because of large number in-
volved, protesting process may be longer now than normal. Other
factors:
a. Business generally living off inventories, selling off unpopular
items rather than engage fresh capital. Sale about same level generally
as Zaldivar reported 11 days ago in textiles, shoes, etc. Durable goods
and hardware still below 50 per cent of normal. Private construction al-
most at standstill.
b. Head of CAP (national steel industry) tells me that in past two
weeks orders have decreased by 40 per cent or a worsening of 10 per
cent since ten days ago. His cash bind fierce and GOC not yet grant him
extra cash to pay off but he (and I) believe he will get it shortly.
c. Valparaiso port is chuckablock with goods unclaimed by im-
porters. Storage rates at port cheap while import duties very high. Im-
probably be followed by Council approval of the negotiated package and instructions to
PDC Congressmen to vote for Allende. At the short end of 1001 odds is the possibility
that the negotiations will falter and the Council will again convene the PDC for a junta
prior to October 24. Frei still thinks there is the slimmest of possibilities that the combina-
tion of a bad economic situation, that is not noticeably improving, and a possible rejection
by the U.P. of the PDC position, might just produce some effervescence in Chile before
Oct 24. It will take a lot of special praying. (Ibid., POL 14 CHILE)
4
Document 136.
378-376/428-S/80023
334 Foreign Relations, 19691976, Volume XXI
porters obviously do not want goods in these market conditions and
can afford storage while they wait to see. However congestion is
having effect on ship lines who do not like costly unloading time and
foreign lines might decide to skip Chile until port area clears. In any
case we have some indications, which I having checked out currently,
that imports are falling off rapidly which is expectable consequence of
situation. That in turn will set back economy in later months.
d. Some US companies such as Kennecott are arranging large
short-term credits by mortgaging more future copper contracts in Eu-
rope (they deal with Franco-Italian Bank here). Everyone in Chile
happy to go along with this deal without realizing that it enables Ken-
necott to remit immediately more dividendsif fact 49 per cent of the
$15 million loan they currently arranging on which they would have to
pay GOC 30 percent tax leaving rough net $5 millionnot bad for com-
pany about to be nationalized. Kennecott keeping me fully informed
but this knowledge should not be imparted in any way to company in
US.
e. ESSO is tightening credit across the board while paying its own
bills in cash so as to justify its pinching of debtors. It also was struck Oc-
tober 3 at lubrication blending plant at San Antonio port and is pre-
pared to hold out for a month. Plant is one of the main (but not only)
suppliers for plastics industry here.
f. ESSO could not squeeze General Tire as much as it had hoped
because Shell (British influenced here) and national company COPEC
(private) are giving credits and oil. However both those concerns are
now running into cash problems.
8. In sum, economic situation is continuing to bite but nothing
spectacular has yet happened. Usually it takes four to six months for
full effects to be felt from this kind of debacle but it not inconceivable
that combination of PDC Junta and market conditions could set off
bankruptcies that could have snowball effect in short run.
9. Action requests:
a. Particular effort to place stories on how Communists and So-
cialists planning to denigrate Frei immediately after Allende assumes
office.
b. Particular effort to place stories on how U.P. intends to lock in
technicians and professionals after November 3.
c. Effort to place story contained Santiagos unclassified 4079 re
president of Senates use of Foreign Ministry report on Hungarians and
grass-roots vs intellectuals at PDC Junta per Santiago 4087.
d. Consider measures that would enable us immediately to reduce
our MilGroup to the maximum level of 13 officers and men as agreed to
by MinDefense, Armed Forces and USG several months ago. Originally
378-376/428-S/80023
September 5November 4, 1970 335
we had planned slow phase out by non-rotation. I would like to do it
now and so inform the Armed Forces here. We are collecting data on
our men, their scheduled ETDs, etc., for dispatch one (sic) I have green
light.
e. Consider what if anything you wish me to tell Felipe Herrera
when I dine with him, at his request, October 7.
136. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs
(Johnson)
1
Santiago, October 6, 1970.
1. [less than 1 line not declassified] came to my office October 5 to re-
late a story that pointed to the possibility of Chilean military interven-
tion. He recounted that at the request of the oil companies, the Army
had named a liaison officer several weeks ago so that in the event of
any contingencies the oil companies installations would be protected.
The officer selected was a Major Palma. (From ArmA records it would
appear to be Major Ricardo Salvador Palma Wormald, passed over for
promotion with about two more years of service remaining; not very
intelligent or impressive.) Palma was designated by General Valen-
zuela as the liaison man.
2. Some three weeks ago when Palma appeared at [less than 1 line
not declassified] office he developed a good relationship with [less than 1
line not declassified] source of the following [name not declassified]. At that
time Palma denounced the political parties in crudest terms and said
that the last time the Army was called, it faced only 200 men and killed
20 (presumably a reference to the confrontation at El Salvador during
the early years of the Frei administration). This time we shall come out
shooting, he added.
3. On October 5 he visited [less than 1 line not declassified] and swore
him to secrecy, then said he was preparing for military intervention
within 10 days. Palma said he would be military interventor in the oil
industry, the term employed when military takes over an industry
under national siege or similar legislation. He pulled out list of all em-
ployees of ESSO at its four main locations (Santiagos two airports,
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
336 Foreign Relations, 19691976, Volume XXI
Maipu and Las Salinas which is near Vina del Mar where there is a
plant for receiving fuel from ships). The names were typed on Army
stationery and bore the official seal. Palma asked [less than 1 line not de-
classified] to identify the dependable and the undependable. He asked
him for a complete list of all trucks and owners dealing with ESSO
throughout the country and for a list of all service stations in Santiago
of all brands. [less than 1 line not declassified] provided answers to the
first and third requests and promised to seek information on the
second. Palma said that when the Army moved it intended to close all
but nine gas stations; those would be used by the Army while the
enemy would be sealed off.
4. Less precise but equally lurid information has been reaching us
from many quarters and it usually proves to be nothing more than
wishful thinking. This report must be considered in the same vein.
5. However I would prefer that we ceased to check out all such re-
ports and to be totally surprised by whatever might develop in the
Armed Forces. In the present circumstances it is waste activity for all
concerned. Hence I am instructing CAS and DAO to desist from the
normal efforts to learn of possible military moves.
137. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, October 6, 1970.
1. The PDC has named a stacked negotiating committee (Leighton,
Fuentealba, Maira) to negotiate with the U.P. the so-called constitu-
tional guarantees. Since this threesome is determined to have Allende
elected whatever the circumstances, the possibilities of an October 24th
surprise in the congress here are very slim indeed.
2. Hence I would like you to reconsider my request to return to
Washington as soon as possible. Frankly, I am not in the least con-
cerned by what anyone here may say about my travel or what may
happen in the interim in Chile. I believe I can handle that in the same
effective manner I did two months ago when I suddenly had to fly
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
September 5November 4, 1970 337
home for personal reasons. I would write Frei and arrange for him to
inform Allende in an appropriate way. It is in Allendes interest to
know what U.S. policy may be.
2
3. My concerns about U.S. policy have less to do with Chile than
the effects elsewhere, particularly on broad presidential goals. For ex-
ample, if the U.S. taxpayer were faced with a very large payoff in A.I.D.
investment guarantees for Chilean nationalizations, is it reasonable to
expect the U.S. Congress not to react? Is it prudent to expect the U.S.
Congress to support more investment guarantees in countries such as
Indonesia or elsewhere in Latin America? What would happen to the
newly created OPIC? And to our hopes for a dynamic role for private
enterprise in LDCs? I have other concerns along the same lines that
should be discussed now because if we do not set our policies by Oc-
tober 24th we shall be confronted with situations November 5th that
give us little option but to react, the worst of all postures.
4. By separate message I am sending some additional facts on the
economic situation.
3
You should also be aware that a great many pri-
vate Chilean companies are paying considerably larger than normal
dividends in a conscious effort to decapitalize. If dividends are not nor-
mally due, they are requesting and receiving permission usually to pay
special dividends. At the same time the Central Bank is sitting on al-
most all U.S. and foreign company dividends for remittance. I suspect
that this tactic is designed to tighten credit here since the dollars for
remittances would have to be purchased with Escudos and thus ease
the internal liquidity bind.
5. Since writing foregoing, MinDefense Ossa has requested
meeting with me tonight.
4
In my talk with Frei Sunday, he asked that I
continue these contacts and said Ossa would be in touch.
2
There is a handwritten note in the margin that reads, and Alessandri?
3
Document 135.
4
In another October 6 backchannel message, Korry reported he expected that this
meeting would focus on U.S. material support for the anti-Allende faction in the PDC. At
the bottom of the message is the following handwritten note: UAJ [U. Alexis Johnson]
asked Karamessines to send back a message sayingdont turn them down flatly; find
out what they want. 10/6/70. (National Archives, RG 59, ChileITTCIA 19631977, Lot
81D121, Documents Requested by the Department of Justice, 19701977) Korry reported
on the meeting in Document 142.
378-376/428-S/80023
338 Foreign Relations, 19691976, Volume XXI
138. Memorandum for the Record
1
Washington, October 6, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 6 October 1970
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. Johnson, Lt. Gen. Richard T.
Knowles, and Mr. Helms
Mr. Charles A. Meyer, Mr. Viron P. Vaky, and Mr. William Broe were present for
Item 1.
Mr. John Holdridge and Mr. William Nelson were present for [less than 1 line not
declassified].
Colonel Richard T. Kennedy and Mr. Thomas Karamessines were present for all
items.
1. Chile
a. The meeting opened with another review of the bidding. For the
benefit of the Chairman, who had been abroad, Mr. Meyer made the
following summary: There is no evidence at the present time that any
Chileans will individually or collectively get the lead out (to put it
colloquially) and Frei remains remorsefully in the wings. The CDU
2
met over the weekend and voted 270 to 191 to negotiate with Allende
over constitutional guarantees. In reviewing the contacts with Amer-
ican business (see minutes of the meeting of 29 September 1970, para-
graph r. for approved actions),
3
Mr. Meyer stated that the Ford Vice
President for Latin America and Asia admitted a loss of $26 million and
fully intended to pull out, but it was a matter of timingthere was
some inventory to salvage. Mr. Johnson had talked to the Bank of
America, and although they did have problems they were not pulling
out at present. The loans had been slowed down, including the cattle
loan, and Export-Import Banks Henry Kearns was moving Chile from
Category C to D loans whereby they would no longer be automatic.
b. A question was asked about the British. Mr. Kissinger retorted
that higher authority had spoken to both Heath and Home and they
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile, 40
Committee Minutes. Secret; Eyes Only. Drafted on October 7. A copy was sent to
Mitchell, Packard, Johnson, Moorer, and Helms. McAfee prepared an account of the
meeting based on his conversation with an unnamed participant that summarized the
discussion and suggested that, The Committee is faced with a problem since Higher Au-
thority does not accept the fact that Allende is likely to be President. (National Archives,
RG 59, ChileITTCIA 19631977, Lot 81D121, Documents Requested by the Department
of Justice, 19701977)
2
Meyer was referring to the PDC, the Christian Democratic Party of Chile.
3
Document 127.
378-376/428-S/80023
September 5November 4, 1970 339
later indicated they would re-examine the matter of a 4 million pound
loan. MAP was to be held in abeyance (there was an exchange be-
tween Ambassador Korry and Department of State on semantics of sus-
pension); all munition licenses were also suspended.
c. Other developments were that Anaconda, faced with a strike,
had taken a hard position and would hold out for a while. The incum-
bent government supports this and Allende was reported furious.
Other companies, such as Esso and Singer, were being prudent by re-
stricting credit. As might be expected, they were not risking much; in
point of fact, they were hedging. The principals were back to their
starting point: i.e., how much economic turmoil or indications thereof
would it take to nudge the military into a take-over?
d. Mr. Kissinger emphasized there were only 18 days left and that
some drastic action was called for to shock the Chileans into action. Mr.
Mitchell said the actions taken so far were well and good but had they
been publicized? Mr. Karamessines indicated that Allende was aware
of the trend and in an interview in Prensa Latina had castigated an in-
ternational conspiracy to bring the country to its knees economically.
Mr. Mitchell still wanted to know if the average Chilean was aware.
e. Mr. Meyer referred to a report that the army had told Frei they
were not competent to govern nor did they think they were competent
to handle major disorder and chaos should such occur. Mr. Broe noted
that there was no other collateral reporting to support this statement.
f. It was apparent that both Frei and Korry flashed hot and cold
and this resulted in considerable inconsistency in point of view.
g. Mr. Meyer pointed to the need to determine a post-Allende posi-
tion such as proposed in NSSM 97. It was agreed that an early NSC
meeting was desirable on that subject. Mr. Kissinger said this pre-
sumed total acceptance of a fait accompli and higher authority had no
intention of conceding before the 24th; on the contrary, he wanted no
stone left unturned.
h. There was a discussion about conveying to the Chileans the in-
tentions of American business. By tipping our hand blatantly we could
incur such hostility for the future that Allende might go right ahead
with full expropriation.
i. Mr. Kissinger was quite blunt: if higher authority had the choice
of risking expropriation or Allende accession, he would risk the
dangers of expropriation. If by a miracle the Chileans achieved their
own upset of Allende, the finger would still be pointed at the USA. He
urged that the U.S. companies be pressed further.
j. Mr. Johnson pointed out that the 40 Committee had done about
all it could given its charter; it had acted on recommendations of the
Ambassador as well as those of the principals. Mr. Karamessines raised
378-376/428-S/80023
340 Foreign Relations, 19691976, Volume XXI
the question whether the USG wants to take an open posture of hos-
tility to Allende by overt economic warfare. Mr. Kissinger said the
word should be spread in unmistakable terms short of being com-
pletely obvious. He went on to note the inevitable contrast of higher au-
thority advising heads of state in Europe of the absolute undesirability
of an Allende regime in Chile while back home the bureaucracy per-
formed a slow gavotte over what our posture should be.
k. At this point the principals made the following decisions:
(1) Mr. Meyer was to get in touch with Harold S. Geneen of IT&T
(he has been abroad) and convey to him in strong terms the feeling of
this administration about an Allende accession to power and seek to
corral his influence.
(2) CIA was directed through its own assets to help get the mes-
sage over to the military in no uncertain terms that MAP faucets were
to be turned off and Chilean military training in Panama was to be held
in abeyance. MAP equipment in the pipeline was to be held up. (State
would draft a message to Korry to this effect.) Mr. Helms had stated
that he was not sure the current signal that MAP was closing down was
sufficient. Exactly who had said what to whom?
(3) Ambassador Korry had suggested the military advisory group
be reduced immediately. It was decided this signal might be inter-
preted as folding tents in advance of an Allende victory. Ambassador
Korry was to be turned down on this recommendation.
(4) On his request for guidance on his meeting with Felipe Herrera
it was determined that Korry should be instructed to make no commit-
ments to Herrera nor serve as any channel to Allende and attempt only
to elicit the future Herrera role with an Allende regime.
(5) Mr. Kissinger objected to a certain paragraph 5 of a Korry mes-
sage dated 6 October 1970 and asked that it be rescinded forthwith.
4
[Omitted here is discussion unrelated to Chile.]
Peter Jessup
4
Document 136.
378-376/428-S/80023
September 5November 4, 1970 341
139. Memorandum From the Deputy Director for Plans of the
Central Intelligence Agency (Karamessines) to Attorney
General Mitchell
1
Washington, October 6, 1970.
SUBJECT
Communication from our Chief of Station in Chile
We have just received a cable from our Chief of Station in Santiago
reporting a conversation he has had with the Ambassador in the course
of which the Ambassador set forth his reasons for wishing to come up
to Washington at this time.
2
In view of the discussion at the 40 Com-
mittee meeting today,
3
I thought you would be interested in reading
the reasons given by the Ambassador in his discussion with our Station
Chief. When you have finished with this memorandum [name not de-
classified] will return it to me by safe hand.
The Ambassador said that he would persist in asking the Depart-
ment of State to summon him for consultation. Since the ballgame is
lost, the reason given by the Department of State for not wanting him in
Washington at this time is no longer valid. He needs authorization to
open talks with Allendes economic advisors on expropriation of
American property. He brushed aside the Chief of Stations concern
that any leakage concerning those talks might extinguish the last re-
maining flicker of a will to resist. The Ambassador averred that the
talks would remain secret since any leakage was obviously contrary to
Allendes interests. He claimed to be working against a 5 November
deadline when a nationalization bill would be introduced and any
chances for modification through bilateral talks would go by the board.
The Ambassador did not divulge the basis of his contention that the bill
will be introduced on 5 November. The Ambassador also voiced con-
cern over the size of the AID investment guarantees, variously esti-
mated at between 500 million and one billion dollars. He believes that
1
Source: Central Intelligence Agency, Job 780717BA, DDP Chron File, January
December 1970. Secret; Sensitive; Eyes Only. A copy was sent to C/WH and DDP. A
handwritten note at the end of the memorandum reads: Given to Watch Office nite of 6
Oct for [name not declassified] to deliver to the A.G.
2
Korry made these points directly in an October 3 backchannel message to Johnson:
In view of latest developments (Marxist offer to negotiate with Christian Democrats) be-
lieve it best to hold in abeyance any implementation action here until I have time to think
through best way to proceed. Believe my travel to Washington suggestion now rein-
forced. (National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Documents
Requested by the Department of Justice, 19701977)
3
See Document 138.
378-376/428-S/80023
342 Foreign Relations, 19691976, Volume XXI
the President is unaware that this contingent liability is hanging over
the head of the Administration and that Congress may suddenly be
faced with a request to cough up that much money. The Ambassador
rhetorically asked, How would this affect prospects of the Presidents
proposals to reform the AID system? Lastly, the Ambassador is anx-
ious to brief his contacts in the media world and to testify before the ap-
propriate Congressional Committees.
Thomas H. Karamessines
4
4
Printed from a copy that indicates Karamessines signed the original.
140. Backchannel Message From the Under Secretary of State for
Political Affairs (Johnson) and the Presidents Assistant for
National Security Affairs (Kissinger) to the Ambassador to
Chile (Korry)
1
Washington, October 7, 1970.
1. Highest levels here continue to be very concerned that, with Oc-
tober 24 rapidly approaching, anti-Allende forces in Chile do not seem
to be coalescing around any effective action to block his election. We
understand from your previous messages that military are entirely
aware that if Allende is elected they can expect no further MAP or other
support from us. If there is any doubt whatever in their mind in this re-
gard, you should use the channels available to you to make this clear.
You have also, in accordance with your recommendation, been author-
ized to inform them that we are already holding in abeyance all
MAP, including military training and visits not already underway. You
have also been informed that we are suspending action on all requests
for processing munitions-control-export licenses for Chilean military.
You have also previously been authorized to inform the military that if
the effort to block Allende from taking office is successful, the Chilean
military will not be ostracized, but rather can continue to count on us
for MAP support and maintenance of our close relationship. As you
know, we have also done our best to encourage American firms and fi-
nancial institutions now to make it clear within Chile the economic and
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Nodis; Eyes Only.
378-376/428-S/80023
September 5November 4, 1970 343
financial consequences that will inevitably flow from an election of
Allende.
2. In addition to the foregoing, you are now authorized to inform
discreetly the Chilean military through the channels available to you
that if a successful effort is made to block Allende from taking office,
we would reconsider the cuts we have thus far been forced to make in
Chilean MAP and otherwise increase our presently programmed MAP
for the Chilean armed forces. In addition to materiel chargeable to
MAP, we also have in mind increased ship loans. If any steps the mili-
tary should take should result in civil disorder, we would also be pre-
pared promptly to deliver support and materiel that might be immedi-
ately required. Obviously we cannot, and we assume Chilean forces
would not want, support of American personnel in such a contingency.
3. Although we realize from your report that the odds are very
long against the Chilean military taking any effective action, we do not
want them to be deterred by what they may feel is any ambiguity with
respect to our attitude toward the election of Allende. We therefore,
leave it to you and your discretion on how in light of above guidance
this can best and most promptly be communicated to the military.
141. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, October 8, 1970, 2325Z.
4177. Subj: Looks Like Allende Is Presidente.
1. It is increasingly likely that Allende will be voted in as President
by near unanimity when Congress meets for runoff on Oct. 24.
2. Almost impossible to foresee any action by Frei, his supporters
or Armed Forces that would prevent Allendes taking office.
3. In addition to the Christian Democrats successful negotia-
tions with Allende, the conservative National Party appears on the
verge of reaching an agreement assuring PN support in the congres-
sional runoff. A majority of the PNs Political Commission favors sup-
porting Allende, and is working out the details of an accommodation.
1
Source: National Archives, RG 59, Central Files 197073, POL 151 CHILE. Confi-
dential; Priority. Copies were sent to Bogota, Brasilia, Buenos Aires, Caracas, Lima, Rio
de Janiero, and USCINCSO for POLAD.
378-376/428-S/80023
344 Foreign Relations, 19691976, Volume XXI
4. There are increased rumors of an attempt to set in motion a coup
by ex-Gen Viaux and some other unguided missiles, but it is our judg-
ment that the army, despite a strong anti-Communist, anti-Allende fac-
tion, would not move in Viauxs support.
5. The Bolivian denouement with its splintering of the Bolivian
Army has reinforced the Chilean Armys desire to protect its own
unity, particularly since it recognizes its own vulnerability to fission.
6. Although the economic situation has not improved, neither has
it deteriorated in any major way. Most Chileans accept the inevitability
of Allendes election as President.
Korry
142. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, October 8, 1970.
SITREPOctober 7
1. Separate message reports on Mil Aid and responds to your
questions.
2
2. Your suggested reply to Ossa arrived after I had followed sym-
pathetic line in opening of our talk but subject of money never came
up.
3
It has now been broached in post-November 4 time frame to Em-
bassy officer working under my close control from Ossas number one
PDC operative Deputy Jorge Santibanez. When I asked Ossa in course
of conversation if there was anything he wished from U.S., he replied
negatively explaining that either Chileans stopped Allende themselves
for themselves or it not worth anything.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
2
The questions were posed in Document 140 and the separate response is Docu-
ment 144.
3
See footnote 4, Document 137.
378-376/428-S/80023
September 5November 4, 1970 345
3. Santiago 4139 (EmbTel #23518),
4
Para 7 of 7 October contains six
of Ossas points. But most important was that he felt that combination
of circumstances might yet persuade Frei to act. He said he had agreed
with Frei not attending Junta since narrow victory at best for Frei forces
would have demonstrated weakness of Frei within party and left Frei
impotent to play any other cards. Ossa said he thought President might
do the following:
a. Make speech to the nation.
b. Talk privately to General Schneider to work out agreed plan for
joint action to block Allende.
c. Go forward with plan to have civilian ministers resign, bring in
military and shift Schneider to civilian portfolio. I suggested that in ex-
tremis that Freista ministers provoke the crisis by resigning themselves
and forcing the Presidents hand.
4. Ossa said in reply to my repeated questions he could not say
what Frei would do, but that he knew Frei very affected by tremendous
unprecedented standing prolonged ovation from 80,000 at national sta-
diumlast Sunday (which I confirmed with leftist U.S. newsman present
for the BrazilChile match and which has not been printed in single
paper Santiago nor mentioned by other media). Also sudden change in
character of Mrs. Frei moving Frei, according to Ossa. Ossa counselled
against any action my part with Frei at this point, stating Frei counted
on me and U.S. Government as friends and did not need anything from
us at this time. Moreover Frei knew our position fully.
5. Ossa did not know at that time, and I only learned today, that
following my talk with Lleras last Saturday night,
5
the ex-Colombian
President called Frei and went to visit him late that night to urge that
Frei intervene in Junta next day (Sunday). Lleras argued strongly that
Frei do whatever possible to block Allende which is a 180-degree
switch.
6. I concluded Ossa only wished to see me last night to alert me to
the outside possibility that Frei might yet act and that the critical deci-
sion is whether he will take to the air nationwide as his first step. Frei
wants the country to know beforehand how the PDCU.P. negotiations
go. He believes that Prado and company are now so confident that they
will leave themselves vulnerable by accepting only what the U.P. is
willing to give. Ossa (read Frei) also wanted to test scenario and hear
advice. Since Frei had told me Sunday he wanted me to see Ossa again,
I suspect that Frei and Ossa have been at least talking over the scenario,
4
Telegram 4139 from Santiago, October 7. (National Archives, RG 59, Central Files
197073, POL 15 CHILE)
5
See Document 132.
378-376/428-S/80023
346 Foreign Relations, 19691976, Volume XXI
although Ossa is extremely loyal and discreet operative who never
commits Frei and matches my own style with him on most matters.
7. Ossa said main purpose of his meeting with generals and ad-
mirals (Santiago 4139, Para 7B) was to make known to military fact
that the three service chiefs had drafted the language of the PDC secret
(until last Friday) condition re the Armed Forces. He said meeting had
been very difficult for him since in the room were four generals
(Montero, Poblete, Buzeta and Sepulveda) and some admirals who had
met with Allende and/or Teitelboim. He had to be extremely careful to
say nothing that would provide the U.P. with the basis for suspicion of
incitement.
8. He said Senate President Pablo had caused him great embarrass-
ment at the Junta when he read document from Chilean Embassy in Bu-
dapest. It was not a Foreign Ministry report as we had stated Monday
but a Chilean DefAtt secret report. Pablo had been given it by Ossa for
use without sourcing, but Pablo had laid it on the desk of Prado at the
Junta. Now Ossa was having a terrible time explaining to the military,
at U.P. prodding, how Pablo had access to secret Defense documents. I
told him to blame it on Viaux.
9. I told Ossa I would be replying to a routine note from him re
Chilean air training with a personal letter stating all MAP courses in
Panama and CONUS were in abeyance. He welcomed the action.
10. Since talking to him, todays Mercurio publishes the text of the
New York Times interview with Allende in which he says that Commu-
nist governments are democratic.
6
I have promptly gotten word to Ossa
that this faux pas by Allende should be seized upon as the moral justifi-
cation for Freis intervention and for a renewed effort within the PDC
to block any acceptance of Allendes promises. Taken together with the
ideas I had Rosenstein-Rodan provide Frei and those Raul Saez has
given to Lleras since my talk with the latter, Frei has plenty to chew on.
The question is only if he has teeth.
11. As you know Time magazine is planning an Allende cover this
week
7
and I have made a maximum effort by providing mass of facts to
their correspondents who are incredibly ignorant (e.g., one told me
today that Frei had swung the Junta to Allende via last minute inter-
vention with Valdes and company). Time stringer here is 100 per cent
Allendista and correspondent speaks no Spanish. I would hope we use
every conceivable asset to affect story since Frei feels U.S. press by and
6
Allendes interview with the New York Times was published on October 4. (Joseph
Novitski, Allende Sees Chile Finding Her Own Way to Socialism, New York Times, Oc-
tober 4, 1970, p. 1)
7
The Time cover and article were published on October 19, 1970. (Time, October 19,
1970, vol. 96, No. 16)
378-376/428-S/80023
September 5November 4, 1970 347
large welcoming an Allende who has very honestly and sincerely told
world via New York Times he intends to create a structure that is as
democratic as Czechoslovakias, Chinas or the USSRs.
143. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, October 8, 1970.
1. I today sent MinDefense Ossa following letter:
Dear Mr. Minister:
I refer to your note NR 4195/6
2
of September 30 in which you
write of future training for Chilean military personnel.
Unfortunately, I am unable to make commitments of any kind on
this or any other United States military training not already underway.
I feel that it is necessary in the present situation to hold in abeyance all
such activity for the time being. As I am sure you can appreciate, it
would be inadvisable, before a new Government of Chile has estab-
lished its policies, for personnel of the Chilean Armed Forces presently
scheduled for training in Panama or the United States to make firm
travel plans under the United States Military Assistance Program.
2. Last night I informed Ossa privately of this decision and also
told him that FMS and MAP materiel deliveries would be held in abey-
ance until policies of the new government are established. I told him
not to cite me as source but could say to key officers that he believed
this U.S. decision had been made.
3. Military Group members and attaches here will simply repeat
line set down in letter (Para 1) when approached by their Chilean coun-
terparts on question of MAP training. They are uninformed on FMS de-
cision and we plan say nothing here for time being about materiel
deliveries.
4. I assume you will inform USCINCSO of these decisions and
manner of their implementation.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
2
Not found.
378-376/428-S/80023
348 Foreign Relations, 19691976, Volume XXI
5. Contingency press guidance in your message of 1 October
(#31070)
3
has our concurrence. If matter does leak, I do believe it
might be advisable to explain on background not for attribution that
U.S. Government is simply holding military programs in abeyance
until new Chilean Governments policies are clarified.
3
This message, most likely instructions to Korry based upon the decisions reached
at the September 29 meeting of the 40 Committee (see Document 127), was not found.
144. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, October 9, 1970.
1. I have taken every appropriate measure to make known to
Chilean military the points contained Paragraph 1 of your message of 7
October.
2
My dual purpose was, as you will recall, to provide Frei with
additional leverage as long as there was any hope of his taking any ac-
tion and at the same time to improve our bargaining position with Al-
lende if he were to come to power. It would appear from the latest CAS
reports that the Frei hope is almost dead. As for the possibility of a coup
from any quarter (see Paragraph 7, etc., of this message) I am unalter-
ably persuaded that we can and should do nothing to encourage such
an action in the circumstances that prevail today.
2. Carabinero head General Huerta called me today to inquire if
my letter to Ossa yesterday
3
applied to all courses and if it represented
my own decision. I replied affirmatively to first and said that second
decision was Washingtons. I added that until we knew what were new
governments policies we could neither afford to continue our mili-
tary programs of any kind nor put Chilean military in position of
being punished for associating with U.S. military. It would be impru-
dent for both. Huerta said he understood perfectly.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
2
Document 140.
3
Document 143.
378-376/428-S/80023
September 5November 4, 1970 349
3. However you should also know that DAO has informed me that
U.S. military deliveries are continuing to arrive by air and sea and
therefore very difficult for military to believe fully our actions although
I think my letter will assist in conveying the idea that we are serious.
4. You should also know that it is likely that now that my letter is
being transmitted to the services by Ossa that the Chilean media may
soon be on our backs accusing us of tendentious effort to provoke coup.
There are a number of ambitious Chilean officers who would want to
gratify Allende.
5. You will note too from DATT Chile message 0279
4
that Chilean
Air Force General Carlos Toro Mazote is in the process of preparing a
letter to USAF officers concerning future relations between the two Air
Forces. Toro apparently discussed subject with these officers (unidenti-
fied here) during very recent visit to U.S. and now, following secret
meeting with Allende, considers himself authorized to confirm that re-
lations will continue as before. It is equally likely that similar actions
will be taken by Naval and Army officers.
6. Turning to your Paragraph 2. I have again consulted our
DEFATTs and MilGroup to ascertain mood of the military. They, like I
and Ossa, are unanimous that any effort to block Allende by offering
more MAP would be totally ineffective and might even produce a con-
trary reaction. Our view is that the Chileans opposed to Allende wish
to act on their own for their own motives or not at all; they would either
be unimpressed by or would resent an effort to provoke their action by
bribery. We are also agreed that:
a. The majority of Chilean military feel that unless Frei and/or
General Schneider make the critical moves the Armed Forces will not
act in any purposeful and united way.
b. The Chilean Army is far from united and that a significant per-
centage of officers are ready to adapt to Allende, however watchful of
his actions they may be in the future.
c. There is only the slightest possibility that a coup effort launched
by ex-General Viaux through his supporters in the Army could spark
enough of the military to produce a chain reaction.
7. My own view and that of my senior State associates is that the
odds are overwhelmingly against a successful coup without the com-
plicity and commitment of Frei and/or Schneider. The military will not
carry out a coup to put Viaux in power. Nor is there a public mood that
would provide a moral justification for a coup. The action of the PDC
majority at the Junta Sunday followed by yesterdays announcement of
a quick agreement between the PDC and the U.P. negotiators on the
4
Not found.
378-376/428-S/80023
350 Foreign Relations, 19691976, Volume XXI
so-called guarantees sharply diminish whatever potential climate of
public support there may have been. And I have just been informed by
the station that the rightist National Party is making its deal with
Allende.
8. In sum, I think any attempt on our part actively to encourage a
coup could lead us to a Bay of Pigs failure. I am appalled to discover
that there is liaison for terrorist and coup plotting among Pablo Rodri-
guez, leader of the post-electoral Patria y Libertad organization, Viaux,
Major Marshall and several well-known discredited rightists (e.g. Ri-
cardo Claro). I have never been consulted or informed of what if any
role the U.S. may have in the financing of Rodriguez. But you should
take most seriously the fact that PDC Party President Prado this week
accused rightists and foreign agents (by which he clearly meant CIA)
of being behind the infantile efforts to stir a reaction through bombings.
You should also recall that PDC Senator Fuentealba accused the U.S. of
being responsible for Viauxs uprising last October.
5
9. An abortive coup, and I and my chief State colleagues are unal-
terably convinced that this is what is here under discussion (if not
more, unbeknownst to me), would be an unrelieved disaster for the
U.S. and for the President. Its consequences would be strongly to rein-
force Allende now and in the future and do the gravest harm to U.S. in-
terests throughout Latin America if not beyond.
10. Even before receipt of reftel I have for days been giving much
thought to how to communicate to you my growing concerns over
what I sensed was becoming a disastrously risky undertaking for the
prestige of the President. Hence you should [consider] this message as
not simply being a response to yours but a carefully considered view
that I have tested in different ways with the most competent of
Chileans and Americans.
11. Finally, you should bear in mind that:
a. I have repeatedly told the Chilean Government that I and I alone
(as the Presidents representative) assume the responsibility in Chile
for all actions of all U.S. agencies including the CIA if it were here.
b. I have repeatedly assured Ossa and Frei that I have told them
fully of all our activities with respect to anti-Allende actions. It was
clear to me that one of Ossas primary purposes in seeking me out night
of October 6th was to learn what if anything we had to do with Army or
Viaux plotting and was awaiting some disclosure from me.
12. I am confident that you are sufficiently aware of my views to
know that I would give the fullest backing to any action program if
5
See also Documents 22 and 23.
378-376/428-S/80023
September 5November 4, 1970 351
there were any reasonable chance of its success. There is no longer any
basis for such hope.
13. Action recommendations:
a. Disassociate ourselves promptly from any association we might
have with Pablo Rodriguez and his organization.
b. End all indirect contacts that may exist with Viaux, Marshall,
Claro, et al, even if it signifies an informational sacrifice.
c. Request the DOD to identify officers to which General Toro may
have spoken during visit, to whom he may be writing and to monitor
any correspondence on this subject. Toro must be made clearly aware
in any responses from his USAF colleagues that the Chilean Air Force
cannot look forward to normal relations if Allende comes to power and
carries out his announced programs. I would appreciate opportunity to
review both Toros letter and proposed responses.
145. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, October 9, 1970.
1. Our reporting of last few days attempts make clear convictions
shared unanimously by all elements this mission that Allende is pract-
ically assured of presidency. It is my conviction that we must now
move rapidly to construct a policy which will effectively deal with that
fact. I therefore repeat with sense of urgency my request for authoriza-
tion of consultation in Washington beginning early next week.
2. At meeting with U.S. businessmen this morning I was pressed
hard for indications of U.S. policy line. Making clear that my remarks
were personal, I said that Allende is undoubtedly a sincere and honest
man who believes his formula for Chiles future will bring greatest
good to greatest number. I added that of course we do not share his
values and perceptions, but we, as they, are prepared to conduct rela-
tions on a pragmatic basis with due regard for mutual interests. All 30
businessmen present agreed with this approach. Dow Chemical and
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
352 Foreign Relations, 19691976, Volume XXI
GM reps asked specifically if we had taken any actions which might be
considered provocative by Allende forces. I said no and took occasion
to explain decision hold in abeyance certain programs as matter of pru-
dence until it could be determined what Allende administrations pol-
icies may be in that respect.
3. Generalities along these lines will very soon have to be replaced
by specific decisions on entire range of U.S. activities and responses. I
have also previously explained pressing need to make contact with Al-
lende and begin what we hope will be negotiating process before No-
vember 4. This requires in my judgment previous consultations and
meeting of the minds in Washington.
4. In this regard, we are distressed to note what appears to be
failure in Washington consider individual agency problems in overall
policy context. Thus, joint State/Defense message on AFTAC (State
163730)
2
is reasonable enough on the specific subject but does not di-
rectly address the AFTAC problem in terms of a coordinated approach
weighing total of U.S. priorities, assets and liabilities. I believe that once
we have clear understanding on overall policy these problems can be
handled in more efficient and intelligent manner.
5. We will shortly be coming in with USAID planning recommen-
dations regarding future of our AID program and presence here. Not
surprisingly, there are differences within the mission on question of
what initial USAID posture should be. Again, I believe now is time to
thrash out matter in Washington.
6. It is not accidental in my view that today for the first time there is
no mention in the U.P. press of CIA or other USG reps (even though
this mention has neither been excessive since September 4 nor per-
turbing to me). I think Allende is alert to my general posture. I believe
further that were I with your permission to transmit back to him
through his official envoy to me, Senator Hugo Miranda, that I wish
to consult with my Government and that I count on the same degree of
understanding that Allende displayed when I wrote in late July to him
and the other two candidates that I would promptly have assurances
we could accept from Allende. I am confident too that Frei, whom I
would also have to inform, would buttress my tactic. In sum, I am per-
suaded that we need not fear any reaction against the U.S. if I were to
leave and I am convinced that to protect U.S. interests in Chile and the
Presidents policies elsewhere that Washington consultation is now
indispensable.
2
Not found.
378-376/428-S/80023
September 5November 4, 1970 353
146. Memorandum for the Record
1
Washington, October 10, 1970.
SUBJECT
FUBELT
1. On the morning of 10 October 1970, the DDP discussed the
Chilean situation on telephone with General Haig. DDP made the fol-
lowing points:
a. The situation looked dimmer now than at any time before.
b. We had made direct contact with a number of the senior military
officers, especially those who had been reportedly very activist-minded
and had received pessimistic reactions from all.
2
c. The type of forward planning Ambassador Korry discussed in
his messages should be followed at this time as we should be preparing
ourselves to deal with an Allende administration. It would be foolish to
throw out the baby with the bathwater. However, Korry in some of
his reactions may be premature.
d. The above notwithstanding, we were continuing to do every-
thing we could to reach the desired objective and were not slowing our
momentum.
2. General Haig advised DDP that Ambassador Korry would be al-
lowed to come to Washington. Under Secretary U. Alexis Johnson had
argued that Ambassador Korry should not be allowed to state at a later
date that he had been refused the opportunity to come to Washington
for consultation.
William V. Broe
Chief
Western Hemisphere Division
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Docu-
ments Requested by the Department of Justice, 19701977. Secret; Sensitive; Eyes Only.
2
CIAs Directorate of Intelligence also reported on numerous coup rumors in TDCS
314/1073970, TDCS DB315/0548470, and TDCS DB315/0558370, October 9, 14, and
17. (National Archives, Nixon Presidential Materials, NSC Files, Box 774, Country Files,
Latin America, Chile, Vol. II) In telegram 4260 from Santiago, October 14, the Embassy
provided a lengthy summary of all of the rumors of which it was aware, but suggested
that a successful and serious coup was unlikely. (National Archives, RG 59, Central Files
197073, POL 239 CHILE) These reports were synthesized in an October 16 INR Intelli-
gence Note, which concluded: A well-coordinated institutional effort to block Allende
and take over the government is unlikely. A precipitous move by several military units,
however, is more possible than was the case several weeks ago. Such a move would
present the leaders of the armed forces with a dilemma. (Ibid.)
378-376/428-S/80023
354 Foreign Relations, 19691976, Volume XXI
147. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, October 13, 1970.
SUBJECT
ChileSRG Meeting October 14: NSSM97
There are fundamental differences among agencies as to how an
Allende government is to be perceived and what its effect on U.S. in-
terests really would be. There are therefore different views about what
kind of a policy we ought to have and what we ought to do about
various operational decisions that now face us.
We commissioned NSSM97
2
precisely to enable us to make a con-
ceptual decision about how to perceive and deal with an Allende gov-
ernment which could in turn be expressed in the operational decisions
we would have to make. Because many of these operating decisions are
now pressing and because considerable emotion is felt over what
agencies consider to be the principles involved, the agencies are
anxious to have NSSM 97 considered. They look to it as the vehicle by
which this basic decision will be made.
What we want to get out of this exercise, therefore, is a Presidential deci-
sion on this basic policy question. There are a whole variety of operational
decisions we will have to make, and which the SRG may wish to review
(see below), but the nature of those decisions will depend upon the
basic premise and concept we adopt concerning the situation.
The attached paper prepared in response to NSSM 97 was written
in August, and suffers a little bit from the time-lag.
3
But it contains a
still current assessment of Allendes probable goals and prospects, and
their impact on our interests. The paper poses four options which are
largely stereotypes to highlight distinctions in posture; it does not de-
scribe the refinements or combinations that might also be possible.
As pointed out in the Analytical Summary
4
(see especially Section
IV, pp 7), however, the basic question about what policy to adopt can be an-
1
Source: National Archives, Nixon Presidential Materials, NSC Institutional Files
(H-Files), Box H48, Senior Review Group, Chile (NSSM 97), 10/14/70. Secret; Sensitive.
Sent for information.
2
Document 46.
3
Attached but not printed. See Foreign Relations, 19691976, vol. E16, Documents
on Chile, 19691973, Document 14. The paper is summarized in Document 52.
4
Attached but not printed is a 9-page analytical summary of the response to NSSM
97 prepared by Vaky.
378-376/428-S/80023
September 5November 4, 1970 355
swered only after one decides what he believes concerning what an Allende
government will be and do, and what kind of threat it poses for us. Thus,
these prior perceptual judgments must be made before one can fruit-
fully consider the costs and benefits of various options.
5
As also noted, the real trouble we haveand the reason there is so much
vexation about this matteris that there are basic differences in the assump-
tions various people hold about an Allende government and what it means. I
therefore suggest that you spend some time in the discussion trying to
spotlight and surface the analytical and interpretive differences in this
regard. If we glide over these or fuzz them up, we will only have
trouble later in deciding policy courses because we may mistakenly as-
sume that everyone views the problem the same way.
The agencies consider the basic policy question of sufficient impor-
tance that they will wish a Presidential decision. State may request an
NSC meeting. You will therefore have to consider how to handle the matter
after the SRG meets. My own view is that a formal NSC meeting would
be desirable but is not essential. If scheduling or other reasons makes it
impossible to hold it in the next week, then we should move the paper
up to the President for decision. If we do that, however, you should in-
vite the agencies to submit their views and recommendations on the
paper in writing for transmittal to the Presidentthis would reas-
sure them that they will get their position in and control the way it is
presented.
Another point you should consideralthough you need not bring this up
at the meetingis how to implement whatever policy decision is made. How
do we ensure an adequate game plan or strategy? My own view is to
have the President call for the formulation of a game plan and have the
SRG supervise or review its implementation.
A number of small operational matters are now pending and deci-
sions cannot long be delayed. You will not want to get into these in this
meeting, but it may be helpful to the principals to understand the kinds
of consequences basic policy posture can have if you list some of these
questions:
5
In the analytical summary, Vaky enumerated several questions regarding the di-
rection of an Allende government: 1. Do Allende and the forces that come to power with
him have the capacity to overcome the initial weaknesses of their position and the do-
mestic opposition and realize their goals, or not?; 2. Can we count on the Soviets and
the Cubans moving circumspectly and slowly, or might they find it in their interest to
press their support and influence at a very rapid pace?; 3. Does Allendes accession to
power mean a Soviet-type regime? Vaky noted that the response to NSSM 97 answered
questions one and three affirmatively, while the Departments position was much more
skeptical of Allendes ability to quickly consolidate power.
378-376/428-S/80023
356 Foreign Relations, 19691976, Volume XXI
Do we send a special or high-powered delegation to the No-
vember 4 inauguration? (You may wish to discuss this point
somewhat.)
Do we make any public statement regarding our attitude toward
an Allende government, such as the usual expression of hope we can
get along?
What do we do about the complex US operations we have
therePeace Corps, AFTAC, NASA, etc.?
Do we start to wind down our activities and limit our presence,
or wait until we get invited out?
What do we do about pending loans and MAP?
Your Talking Points outline the sequence of questions and issues
that we have to decide to get at the basic policy question, as well as the
procedure you want to follow.
6
My own recommendation is indicated
briefly at the end of the Analytical Summary, and elaborated on in a
memo I am submitting separately.
7
I also am including in your book for your information an INR piece
analyzing what an Allende government is likely to mean.
8
You may
wish to skim it because it presents the other viewmaybe it wont be
so bad.
6
The talking points are attached but not printed.
7
Vaky concluded his analytical summary stating: The NSSM97 paper does not
satisfactorily discuss the cost/benefit ratio of possible courses of action. But clearly the
more we try to do internally in Chile the more dangerous the consequences; the more we
have to instigate, as opposed to reinforce, the less our chances of success. One final ques-
tion which one should ask is whether we have to decide now the question of whether to
seek his overthrow. Given the costs and poor prospects now, could one choose a policy
with minimum and maximum objectives and play for the breaks? That is, seek to
hamper himand contain him in the expectation that at a minimumthis would force a lim-
itation or modification of his goals and at a maximum might create a situation more
easily exploitable later to achieve his collapse or overthrow? (State is likely to choose the
NSSM papers Option B as the least unsatisfactory; DOD will probably favor Option C;
the import of the preceding paragraph is the suggestion that there is an in-between
course that would avoid the extreme postures and costs of B and C and have the
minimum-maximum objectives cited above). No memorandum elaborating on these
points and submitted separately was found.
8
For the text of the INR paper, see Foreign Relations, 19691976, vol. E16, Docu-
ments on Chile, 19691973, Document 27.
378-376/428-S/80023
September 5November 4, 1970 357
148. Memorandum From the Assistant Secretary of State for
Inter-American Affairs (Meyer) to Secretary of State Rogers
1
Washington, October 14, 1970.
SUBJECT
An Allende GovernmentU.S. Options
It now appears that Allende will be elected President by the
Chilean Congress on October 24.
There is attached a brief analysis of the probable internal political
situation he would face and of the attitude of his government toward
the U.S.
2
The attached paper also describes the two principal options
for action open to us: to seek to isolate and harass Allendes Chile from
the outset; or to adopt initially a restrained, deliberate posture that
would provide us flexibility. The main advantages and disadvantages
of each are also described.
ARAbelieves that the first option is impracticable, especially when
viewed against the backdrop of nationalism that is widespread in the
Hemisphere. The second of the two policies is therefore preferable. In
essence, this policy would enable us (a) to mitigate some of the unfa-
vorable actions affecting U.S. interests that Allende is contemplating
and (b) to retain our influence on the Chilean scene for as long as pos-
sible. The specific targets of our influence, in addition to Allende him-
self, would be the Chilean people, the military, and certain political
groups determined to prevent a Communist takeover of their country.
This policy would entail the following scenario and specific courses of
action:
(a) Ambassador Korry would use the period October 24
November 4 (Allendes inauguration) to negotiate as much protection
of our interests in Chile as possible. The main objectives are described
in the attached.
(b) The U.S. would adopt a correct public posture toward the Al-
lende government, i.e. normal diplomatic relations.
(c) The U.S. would send a normal delegation to the Allende in-
auguration, i.e. Assistant Secretary Meyer.
1
Source: National Archives, RG 59, Central Files 197073, POL 151 CHILE. Secret.
Drafted by Hurwitch; sent through Under Secretary Johnson. Two handwritten instruc-
tions are at the top of the page: Return to Mr. Meyer and Direct by hand.
2
Attached but not printed is the October 14 paper The Allende Government and
U.S. Options.
378-376/428-S/80023
358 Foreign Relations, 19691976, Volume XXI
(d) The U.S. would honor its obligations already contracted under
FMS credit and cash agreements. On credit, there remains to be deliv-
ered 20 M41A3 light tanks ($852,000) and 25 106 MM recoilless rifles
($516,000). For cash, there remains to be delivered naval ammunition
($1,079,000), naval ordnance spares ($563,000), communications equip-
ment ($794,000), ships spare parts ($223,000) and torpedo components
($313,000). Combined these total somewhat over $4 million.
(e) The U.S. would continue to hold in abeyance undelivered MAP
materiel (a total of $2,526,000) and training programs until Allendes
policies are clarified.
(f) The U.S. would continue exchange programs and small local
impact projects out of the Ambassadors fund as a means of retaining
our contact with the people and Title II program.
The foregoing would comprise the main characteristics of our
public posture. We would bolster certain democratic forces opposed to
a communist take-over.
149. Memorandum for the Record
1
Washington, October 14, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 14 October 1970
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. Johnson, Admiral Moorer, and
General Cushman
Colonel Richard T. Kennedy and Mr. Thomas Karamessines were present for
Items 1 and 2.
Mr. John Holdridge and Mr. William Wells were present for Item 1.
Ambassador Edward M. Korry, Mr. Charles A. Meyer, Mr. Viron P. Vaky, and
Mr. William Broe were present for Item 2.
[Omitted here is discussion unrelated to Chile.]
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
1970, 40 Committee Minutes. Secret; Eyes Only. Drafted on October 16. A copy was sent
to Mitchell, Packard, Johnson, Moorer, and Helms. A notation at the end of the memo-
randum states: re: Committee meeting 10/14/70: Mr. Ray Leddy and Mr. Warren
Nutter from DOD/ISA were also present for Item 2 (Chile). They entered the Situation
Room during discussion of this item, thinking they were attending the Special Review
Group meeting scheduled to follow the 40 Committee meeting. The SRG was to discuss
NSSM 97 (Chile).
378-376/428-S/80023
September 5November 4, 1970 359
2. Chile
a. The Chairman asked Mr. Karamessines to give a rundown on
the latest developments and present situation in Chile. Mr. Karames-
sines pointed out that because of President Freis equivocal attitude
and signals to his military leaders and Cabinet members there is no
pulling together to block Allendes accession to the presidency and a
coup climate does not presently exist. He noted that the unpredictable
General Viaux is the only individual seemingly ready to attempt a coup
and expressed the view that his chances of mounting a successful one
were slight.
b. Ambassador Korry agreed that it was unlikely General Viaux
could trigger a coup and stated that as of now it seemed almost certain
that Allende would be voted into office on October 24th.
c. The Chairman observed that there presently appeared to be little
the U.S. can do to influence the Chilean situation one way or another.
Those present concurred.
d. Ambassador Korry then offered a proposal for consideration
which he had not yet had an opportunity to reduce to writing, but on
which timing was most urgent if it were to be implemented. He stated
that he had been approached on behalf of a group of Freistas who
wished to purchase [less than 1 line not declassified] to use as a political
opposition instrument to the Allende administration, assuming Al-
lendes inauguration as scheduled on November 4th. Ambassador
Korry described [less than 1 line not declassified] as having not only the
[1 lines not declassified]. He stated that it is now owned by Alessan-
dristas who are willing to sell it to the group of Frei backers.
e. [less than 1 line not declassified] has a current operating deficit of
$10,000 per month, and the Freista purchasers would like a commit-
ment for six months covert U.S. subsidy of this deficit. Ambassador
Korry was of the opinion that [less than 1 line not declassified] had a good
chance of functioning as an opposition instrument for a six-month pe-
riod but noted that if it were taken over by Allende prior to that time
the monthly deficit subsidy would cease. He stated that there could be
some U.S. influence on the [less than 1 line not declassified] output, but no
effort should be made to become involved in its actual operation.
f. The Committee agreed this proposal was worth a try and author-
ized [less than 1 line not declassified] funding in the amount of [dollar
amount not declassified] for the six-month period recommended.
Frank M. Chapin
378-376/428-S/80023
360 Foreign Relations, 19691976, Volume XXI
150. Minutes of a Meeting of the Senior Review Group
1
Washington, October 14, 1970, 4:205:20 p.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger CIA
Lt. Gen. Robert E. Cushman
State
Mr. Thomas Karamessines
Under Secretary John Irwin
Mr. William Broe
Ambassador U. Alexis Johnson
Mr. Charles A. Meyer JCS
Ambassador Edward M. Korry Adm. Thomas H. Moorer
Rear Adm. Mason B. Freeman
Defense
Mr. David Packard NSC Staff
Mr. G. Warren Nutter Mr. Viron P. Vaky
Mr. Raymond Leddy Col. Richard T. Kennedy
Mr. Arnold Nachmanoff
Justice
Mr. D. Keith Guthrie
Atty. Gen. John Mitchell
SUMMARY OF CONCLUSIONS
Alternative action programs to deal with the Allende government
will be prepared and submitted to the President in a memorandum,
along with agency views. The programs should list specific actions
which the US might take to hamper an Allende regime, isolate it in the
Hemisphere, and, if circumstances permit, facilitate its downfall. De-
fense and State will each submit program proposals, which will be re-
viewed by the Senior Review Group on October 17.
Dr. Kissinger: The NSSM 97 study was initially commissioned in
August to deal with the contingency of having an Allende government
come into power.
2
It was put aside at that time pending clarification of
the political situation in Chile.
The basic question is what the US position should be in order to
limit or prevent the negative effects of an Allende government on our
interests in Chile and elsewhere. The paper discusses the nature of an
Allende government, the threat it would pose to us, and the actions
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), H48, Senior Review Group, Chile (NSSM 97), 10/14/70. Secret;
Sensitive. The meeting took place in the White House Situation Room. A copy was sent to
Vaky, Kennedy, and Nachmanoff. All brackets are in the original.
2
Summarized in Document 52. For the full text of the response to NSSM 97 and its
annex, see Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ments 13 and 14.
378-376/428-S/80023
September 5November 4, 1970 361
available to us to protect our interests. The analysis offered by the
NSSM study is grim and is supported by Eds [Ambassador Korrys]
judgment. The conclusion is that Allende would seek to create a
Marxist state in Chile, to diminish US influence, and to establish close
relations with Cuba, the USSR and other socialist countries. The study
estimates that Allende can achieve these goals over a period of time if
he acts with sufficient care and skill. I dont recall that the paper makes
any judgments about the impact that an Allende regime will have on
other countries.
Have I correctly summarized the judgment of the paper? Does
anyone disagree? Charlie [Meyer]?
Mr. Meyer: The question of the impact on other countries is treated
on Page 18.
Dr. Kissinger: What I mean is that the paper doesnt analyze the ef-
fect in specific countries, such as Peru or Brazil.
Mr. Meyer: I see. Thats right.
Dr. Kissinger: The judgment of the NSSM study, as stated on Page
18, is that the US has no vital interests in Chile, that the world military
balance of power would not be significantly affected by Allendes ac-
cession, but that there would be some political and psychological cost
to the US and some negative effect on hemispheric cohesion. The study
considers that an Allende government would represent a definite
psychological setback to the United States. Does everyone share this
judgment?
Mr. Meyer: Hemispheric cohesion might be more real ex Chile
than it is now. If Chile attacks the OAS system, the Hemisphere might
be unified against Chile. How much influence Allende has in the short
term depends entirely on the direction in which the Chilean Govern-
ment moves.
Dr. Kissinger: To play the devils advocateif Propositions 1 and 2
[on Page 18 of the NSSM 97 study; namely, that the US has no vital in-
terests in Chile and that Allendes accession will not alter the military
balance of power] are true, and if hemispheric solidarity would be
strengthened with Allende in power, then why should we bother about
an Allende government?
Adm. Moorer: Proposition 2 overlooks the impact on hemispheric
defense.
Mr. Packard: An Allende government might serve as a catalyst for
further unfavorable developments.
Ambassador Johnson: From a military point of view, Chile could
be important in a negative way. An Allende government might give the
Soviets a chance to extend their naval power into the South Pacific, but
maybe that is not vital.
378-376/428-S/80023
362 Foreign Relations, 19691976, Volume XXI
Adm. Moorer: It would cause us extreme gas pains.
Dr. Kissinger: It all depends on how you define our vital interests.
There are two things Allende could do. First, he might quickly adopt
a very hostile attitude toward the United States in order to demon-
strate that the US could be defied and in order to rally the Marxists
throughout Latin America. Alternatively, he could move with consid-
erable circumspection and restraint. This could have an impact on Italy.
It would give a respectable look to the status quo. It would create the
same confusion in other Latin American countries that we have already
seen in Chile in connection with Allendes rise to power.
The second course might be the more dangerous for us.
Ambassador Korry: Allende has already chosen the second course.
Ambassador Johnson: I think it would be interesting for the group
to hear what Ed [Korry] can tell us about the Chilean Communist Party.
Ambassador Korry: The Chilean organization has several distin-
guishing factors which make it unique among Communist parties.
There is no competition of any kind for leadership. The leader is un-
charismatic but is a political and managerial genius as shown by his
success in keeping the worker and intellectual elements of the Party to-
gether. There have been no doctrinal disputes within the Party at any
time (and we are well informed on Party activities). The Party has
achieved every goal it has set for itself in the last six years. It has con-
tained the challenge from the extreme left; one of the real political com-
petitions to be seen in Chile is that between the Chinese and the Soviets.
Allende is really more a challenge to the Chinese Communists than to
the United States. He may cause the Chinese to provoke more violence
in Argentina.
Dr. Kissinger: How is that? You have lost me there.
Ambassador Korry: The Chinese will want to try to upset the
tempo of Allendes progress in Chile. They could stimulate violence in
Argentina in order to demonstrate that the peaceful road to power, as
practiced by Allende, is not the best path.
Ambassador Johnson: The Chilean Communist Party is com-
pletely Moscow-oriented.
Ambassador Korry: It was the first party in the world to approve
the Soviet invasion of Czechoslovakia. This involved a 180-degree
change in policy in a few days, and it was accomplished without any
defections.
Ambassador Johnson: In Chile the Maoist element is found in the
extreme left wing of the Socialist Party.
Ambassador Korry: Years ago Allende chose to follow the Com-
munist tactics of peaceful pursuit of power. The Communists master-
minded his election strategy. They provided the power, the organiza-
378-376/428-S/80023
September 5November 4, 1970 363
tion, and the numbers. (They gave him 16% of the total vote; his overall
share was 36%).
Dr. Kissinger: Lets return to the question of what happens in Ar-
gentina. If Allende chooses to follow a moderate course, then radical el-
ements in Argentina will try to seize power through violent means.
Ambassador Korry: Yes, the radicals would work through the MIR
organization. Or the same thing could happen in Uruguay, with the
Tupamaros.
Dr. Kissinger: Allende is already in power. He has made the case
for his route to power and doesnt need to prove anything. The best the
radicals can do is show that their course is a viable alternative. Al-
lendes problem is to show that he can retain power.
Ambassador Korry: The radicals will try to demonstrate a compet-
itive system for gaining power. Anything the radicals do to stir up
trouble in Argentina and Peru will be blamed on Chile, and this will
create problems for Allende because the Argentine and Peruvian Gov-
ernments will protest to him.
Dr. Kissinger: Whichever course Allende adopts there will be tur-
moil in other countries. Either he will create it, or his opponents will. Is
that a fair conclusion?
Ambassador Korry: Yes.
Dr. Kissinger: Where does that leave us?
Ambassador Johnson: With Chile everyone can state the problem,
but no one has any solutions to offer.
Mr. Meyer: There will be turmoil in Latin America with or without
Allende. The drift to the left is inevitable. My own feeling is that our po-
sition on Chile should be based on the most operative policy we can
adopt. If we eliminate Option 1 (of the NSSM 97 study), which is to put
both arms around Allende, we come down to two possible alternatives:
Options 2 (cool and correct posture) and 3 (efforts to isolate and ham-
per him).
Ambassador Johnson: Option 3 means that we take the initiative in
seeking to contain Allendes harmful impact on our interests.
Mr. Meyer: Thats right. We would seek to exert our influence.
Our policy ought to be to maintain such communications as are pos-
sible with Allende without making him into the hero of the Western
Hemisphere.
Dr. Kissinger: On the basis of the analysis I have heard around the
table, it seems that either a moderate or a hostile Allende would be dan-
gerous to us, but for different reasons. No one feels that we have no
particular interest in Allendes existence. None of us wants to see Al-
lende in power. The question is really what tactics we should use in
dealing with him.
378-376/428-S/80023
364 Foreign Relations, 19691976, Volume XXI
Mr. Packard: Perhaps we are taking this a little too calmly. It is not
just a question of the world military balance. Quite apart from this, we
would have some real worries with Allende established in Chile.
Ambassador Johnson: We all agree that Allende is bad news. But
since it appears we will have Allende, what we ought to talk about now
is what we will do when that happens.
Mr. Packard: We can wring our hands and deplore the situation.
We could do something loud, although that would probably not be the
right thing to do. Nevertheless I think we ought to take some positive
action. This may stir up the Communists in other countries, but they
will be stirred up anyway.
Ambassador Johnson: (to Packard) Your objective would be to
bring down Allende?
Dr. Kissinger: If I read the signs correctly, my client would like to
bring him down.
Mr. Packard: We can bring him down. In assessing the position we
ought to take on Allende, we should consider the reaction in other
countries. If we give the appearance of doing nothing in the face of a
Communist takeover, we will create a bad impression. Look at Peru. If
at first we had taken a stronger stance there, the outcome might have
been better for us.
Ambassador Korry: I would like to point out that there are several
actions we can take. But first, I want to say that militarily we lose
nothing by an Allende government unless the Soviets choose to do
something, such as setting up a base. What I hope would be our policy
would be that while there is nothing we can do to bring Allende down,
we can make it more difficult for him to succeed.
As for what we can do, we should first of all maintain a correct
public posture in our relations with Allende. However, our private ne-
gotiating posture would be tough and would seek to satisfy the two
fundamental criteria we have established to govern our relations with
Cuba, namely, that there is to be no Soviet military presence and there
will be no export of revolution. We should insist on adequate and
prompt compensation for nationalized American properties. (A bill ex-
propriating the copper companies will probably be introduced on No-
vember 5). We should also seek to mitigate the speed with which the
Allende government recognizes the avowed enemies of the United
States. While we may not be able to do anything about Communist
China and Cuba, we might at least get them to hold off on North Viet-
nam, North Korea, and East Germany.
Dr. Kissinger: What means do we use to accomplish this?
Ambassador Korry: I think we can negotiate these points with Al-
lende in the period from October 24 to November 5.
378-376/428-S/80023
September 5November 4, 1970 365
Dr. Kissinger: What will we use for leverage?
Ambassador Korry: The threat of our hostility. This would be im-
portant to Allende. He will be facing many problems in the first months
of his administration.
Another thing we can do is to build up those political elements in
Chile opposed to Allende so that they will have a maximum impact on
the March 1971 elections. We can maximize the difficulty for Allende of
managing a difficult country with mediocre people at a difficult time.
Economic problems for Chile may be at a peak next March. While Al-
lende has a plan for dealing with these, we can still make it difficult for
him. This three-levelpublic, private, and covertapproach would
show results to the other Latin American countries. It would enhance
US influence by showing we can extract concessions from the Allende
regime.
Dr. Kissinger: That all depends on who the Latin Americans think
is taking whom.
Options 2 and 3 are not necessarily alternatives. It is possible to
isolate and hamper while following a restrained and cool policy. One is
an objective; the other is a method.
The basic issue raised by Ed [Korry] and by our discussion is that
while we all agree that an Allende government is substantially against
our interest, how can we best protect our interest. Should we show
open hostility or should we let him make the first move? Should we
give him an opportunity to say that we have driven him to a position of
hostility? My own judgment is that Allende will move to a position of
hostility toward the United States as fast as he can. For us, the question
is how do we maneuver so as to hamper him.
(Attorney General Mitchell left the meeting at this point).
Adm. Moorer: (to Ambassador Korry) Do you think he is going to
get stronger?
Ambassador Korry: Unfortunately, I am on record as stating that
this will be an almost inevitable process. I give much credit to the Com-
munist Partys capacities. The opposition is bumbling. I start with the
assumption that Allende will make it.
One possible scenario would be to make it as tough as possible for
him while at the same time being correct in our relations with him. We
just might be able to bring it off. Also, we could bring off a large vote
against him in the coming elections. That would be the covert part. That
would have a large impact throughout Latin America.
If we can negotiate an arrangement with Allende that does not
commit us to help him but shows we can defend our interests, our posi-
tion will be helped throughout the world. Most Latin American and
Western European countries want us to adopt a cool and correct atti-
378-376/428-S/80023
366 Foreign Relations, 19691976, Volume XXI
tude toward Allende. They do not want us to fall into the trap of al-
lowing him to make us the scapegoat for his problems.
Dr. Kissinger: If Allende fears our hostility enough to desist from
things he wants to do, such as recognizing North Vietnam and North
Korea, why should we yield our hostility? What do we care whether he
recognizes North Korea?
Hostility has its advantages. It would maximize internal pressures
on Allende and give him an increasing incentive to make other conces-
sions. The disadvantage is that it would allow him to appear to be per-
secuted. US domestic opinion might then feel that he was a great re-
former who was driven to a position of hostility by our policies.
Ambassador Korry: Hostility would not have the effect of in-
creasing internal pressures against him. It could drive the army to sup-
port him.
Dr. Kissinger: If we dont show hostility, we could maximize in-
ternal divisions. However, we would confuse other Latin American
countries. Consider also the impact in Italy of an example of a gov-
ernment cooperating with the communists while easing the US out.
Lt. Gen. Cushman: A policy of overt hostility will inhibit our
ability to carry out covert operations.
Dr. Kissinger: What we need is some sort of action program. No
one fully knows what we or the President want. I can imagine that if we
send out a circular instruction describing our objective as maintaining
correct relations with Allende, we will find that our people will be
urging other countries also to follow a correct policy toward Chile.
However, what we really want is to stimulate opposition to him.
Rather than ask the President to decide between Options 2 and 3,
we should give the President an action program to show how we
would achieve our objective of getting rid of Allende (if we are very
lucky) or of slowing him up in Chile while isolating him as much as
possible in the Hemisphere.
Since it probably wont be possible to schedule an NSC meeting,
we should get this to the President in the form of a memorandum.
Mr. Packard: I continue to think we should take an active
approach.
Ambassador Korry: The harder the line we take, the faster we will
get the Soviets in.
Dr. Kissinger: The quicker the Soviets go in, the faster we can con-
front Allende.
Ambassador Korry: What I would like to do is to have us conduct a
private negotiation (as we did with President Frei prior to his inau-
gural) in the period between October 25 and November 4. [Ambas-
sador Korry in this and subsequent statements was referring to a paper
378-376/428-S/80023
September 5November 4, 1970 367
which he had brought to the meeting.]
3
We would be trying to avoid
having legislation submitted to the Chilean Congress that would lock
in concrete Allendes policies and programs. We would make clear that
the nature of his relationship with the US would depend on how he be-
haves with regard to the two Cuban criteria of no Soviet military pres-
ence and no export of revolution. We would seek prompt and effective
compensation for nationalized US properties and flexibility in the pace
of Chilean recognition of avowed US enemies. We would offer a policy
on non-hostility toward Allende.
Dr. Kissinger: What do you mean by non-hostility?
Ambassador Korry: We would seek to avoid reprisals against
Chile under US laws restricting foreign aid, and we would not hamper
action on Chilean requests pending before international financial insti-
tutions. We would negotiate a settlement of the Chilean debt to the US
Government. This could be useful to Allende and at the same time
serve to protect our interest in insuring payment. The same would be
true of Chilean debt to private US interests.
Ambassador Johnson: The debt amounts to about $800 million.
Ambassador Korry: We would also seek to maintain our informa-
tion and exchange programs.
Dr. Kissinger: What happens to aid?
Ambassador Korry: It would be phased out except for a very few
programs. We would seek to preserve our contacts with the Chilean
military by honoring our outstanding contracts. There is some $4 mil-
lion worth of items in the pipeline. Outstanding credits under the For-
eign Military Sales Program total $1.3 million covering some M46
tanks and 106 mm. recoilless rifles. We have some uncompleted deliv-
eries under cash sales, covering naval ammunition, ordnance, and
other items.
Dr. Kissinger: What should we tell Brazil and Argentina and other
Latin American countries?
Mr. Meyer: We should consult them and tell them exactly what we
are doing in Chile and why.
Mr. Packard: (to Korry) You are proposing that we go ahead with
military deliveries?
Ambassador Korry: However, there would be no new contracts.
Dr. Kissinger: I said earlier that the quicker the Soviets move in to
Chile, the quicker we can confront Allende. The elements opposed to
Allende will be at their greatest strength early in his administration. He
will try to erode the opposition gradually. After six to nine months it
3
Not further identified.
378-376/428-S/80023
368 Foreign Relations, 19691976, Volume XXI
probably wont make any difference what we do because he will be
firmly entrenched. Therefore, if the Chilean military very quickly gets
evidence that Allendes policies are pointed toward a pro-Soviet orien-
tation, they may be galvanized into action. It is very hard to react to
these specific proposals. What we need is a complete course of action.
We should elaborate on the tough line which Dave [Packard] advo-
cates. We should set down exactly what actions we would take, what
we would say to other countries, etc. Dave [Packard] and Warren
[Nutter] can put together a proposal for a tough approach. Alex
[Johnson] and Ed [Korry] can prepare a similar paper along the lines of
what Ed has been presenting. That way we will know exactly what we
are talking about. We can give the President specific proposals and in-
clude statements of your views.
How about having a meeting Saturday morning [October 17] to
look at the plans? We need to get some decisions quickly. There are a
number of practical issues, such as the composition of an inaugural del-
egation, which will have to be resolved soon.
Mr. Nutter: (to Kissinger) You mentioned that there might be an
adverse public reaction in the US if we were too hostile to Allende at
the beginning. It seems to me that if we dont take a strong stance, a
very large segment of US opinion will feel we stood by while the Com-
munists took over. The reaction would be worse than with Cuba.
Dr. Kissinger: Lets meet at 9:30 on Saturday.
Mr. Packard: Could we make it earlier?
Dr. Kissinger: All right. Lets try for 9:00.
151. Editorial Note
On October 14, 1970, Army Attache Lieutenant Colonel Paul Wi-
mert received the following message marked Top Secret; Sensitive; De-
stroy Immediately from Director of the Defense Intelligence Agency
Lieutenant General Donald Bennett: 1. You will select two Chilean
General Officers who can best be trusted to be discreet and who are
most likely to respond and convey to them the following: High au-
thority in Washington has authorized you to offer material support
short of armed intervention to Chilean Armed Forces in any endeavors
they may undertake to prevent the election of Allende on October 24,
his inauguration on 4 November, or his subsequent overthrow. 2. In-
form me immediately through CAS channels when offer has been
made and reaction thereto. Also relay immediately any requests or sug-
378-376/428-S/80023
September 5November 4, 1970 369
gestions concerning assistance which Chileans may broach. 3. Discuss
this matter with no one repeat no one except contacted general officers
and CAS Chief of Station. Should any other person mention this matter
to you, deny any knowledge and report circumstances to me immedi-
ately via this channel. I rely on your utmost discretion. Your contacts
must realize that this matter must remain strictly in military channels.
Except for you and your above noted contacts, U.S. policy is as indi-
cated in recent State and DoD messages. (Central Intelligence Agency,
Job 80R01284A, Box 24, Chile) Apparently the signature is that of De-
fense Intelligence Agency Deputy Director Lieutenant General Jamie
Philpott. Philpott stated in congressional testimony, however, that al-
though the signature appeared to be his, he could not recall seeing the
message and doubted having signed it. (Alleged Assassination Plots, p.
237)
Wimert had been directed by Philpott, acting for the absent Ben-
nett, to assist the Station in Chile. In a September 28 message, Philpott
instructed Wimert to work closely with the CIA chief, or in his ab-
sence, his deputy, in contacting and advising the principal military
figures who might play a decisive role in any move which might, even-
tually, deny the Presidency to Allende. Do not, repeat not, advise the
Ambassador or the Defense Attache of this message, or give them any
indication of its portent. In the course of your routine activities, act in
accordance with the Ambassadors instructions. Simultaneously, I
wishand now authorize youto act in a concerted fashion with the
CIA chief. This message is for your eyes only, and should not be dis-
cussed with any person other than those CIA officers who will be
knowledgeable. CIA will identify them. (Alleged Assassination Plots, p.
236. A copy of this telegram is also in the National Archives, RG 59,
ChileITTCIA 19631977, Lot 81D121, Chile Papers, Church Com-
mittee, August 12, 1975) Further elaboration on the role played by
Colonel Wimert based upon congressional testimony of the principals
is in Alleged Assassination Plots, pp. 235238.
The following explanation was given in telegram 763 to the Station
in Santiago immediately following the October 14 message from Ben-
nett to Wimert: There seems little doubt this will confuse Col Wimert.
Background for his information: both Generals Bennett and Philpott
have been briefed by C/WHD [Western Hemisphere Division Chief
William V. Broe] and are aware of his valuable efforts in spreading the
word to the military, but without detail on degree to which Wimert has
been encouraging the military. This new message originates outside
the office of Bennett and Philpott, and is known to several persons. As
we understand it, Bennett and Philpott felt they could not tell these
new interested parties of 28 Sept message; thus this new instruction is
pro-forma. Col Wimert should understand, however, that his response,
378-376/428-S/80023
370 Foreign Relations, 19691976, Volume XXI
even though in our channel, may be read by relatively wide audience.
Thus suggest Wimert reply equivocate on actual dates and in short,
while Track II principals aware of Wimerts fine performance, it would
be best if COS and Wimert can work out response to ref that does not
signal seriousness of his past activities to those who await his reply.
Once Wimert has selected two Chilean General Officers (see ref) his
subsequent reports can be candid and comprehensive, as long as com-
prehensive does not obviously include discussions prior to receipt of
ref, especially in describing material support. Note that we must ad-
vise General Bennett time when Wimert shown ref. (Central Intelli-
gence Agency, Job 80R01284A, Box 24, Chile)
Wimert, in an October 15 backchannel message sent Eyes Only to
Bennett, replied: My selections from among the General Staff Officers
who stand out because of their discretion and political orientation are
General Camilo Valenzuela, commander of the Santiago Garrison, and
[redacted to read another Chilean General]. Based on guidance passed
on to me via the Chief, CAS on 8 October I have already been in contact
with both of these officers. Acting upon the instruction conveyed to me
by CAS I informed them, in a discreet manner, that if a successful effort
is made to thwart Allende from taking office, we would reconsider cuts
we have taken in our MAP program and would increase such support
in the future. I also informed the Chileans that should there be civil dis-
order as a result of a military move to block Allende, the USG would be
prepared to deliver material support that might be needed. At the same
time I pointed out that we could not provide American personnel in
such a situation. I shall now recontact the aforementioned officers and
convey the message I have just read. (Ibid.)
The other general was General Alfredo Canelas Marquez, Director
of Military Intelligence. A late October undated memorandum from
Colonel Robert C. Roth to Philpott listed key personnel in the
Chilean military and briefly discussed whether they were approach-
able for a potential coup. (Telegram 539 from the Station in Santiago to
Headquarters, October 15; Ford Library, Philip Buchen Collection, Box
11, Job 800012A, Intelligence Subject File, Box 112, CIA-Chile (2)) A
covering memorandum by Roth stated that, these folders contain data
on all individuals who were discussed in a favorable light at the 21 Oc-
tober meeting. The others have been eliminated. The folders were not
found.
378-376/428-S/80023
September 5November 4, 1970 371
152. Memorandum of Conversation
1
Washington, October 15, 1970.
1. [1 paragraph (13 lines) not declassified]
2. Then Mr. Karamessines provided a run-down on Viaux, the Ca-
nales meeting with Tirado, the latters new position (after Porta was re-
lieved of command for health reasons) and, in some detail, the gen-
eral situation in Chile from the coup possibility viewpoint.
3. A certain amount of information was available to us concerning
Viauxs alleged support throughout the Chilean military. We had as-
sessed Viauxs claims carefully, basing our analysis on good intelli-
gence from a number of sources. Our conclusion was clear: Viaux did
not have more than one chance in twentyperhaps lessto launch a
successful coup.
4. The unfortunate repercussions, in Chile and internationally, of
an unsuccessful coup were discussed. Dr. Kissinger ticked off his list of
these negative possibilities. His items were remarkably similar to the
ones Mr. Karamessines had prepared.
5. It was decided by those present that the Agency must get a mes-
sage to Viaux warning him against any precipitate action. In essence
our message was to state: We have reviewed your plans, and based on
your information and ours, we come to the conclusion that your plans
for a coup at this time cannot succeed. Failing, they may reduce your
capabilities for the future. Preserve your assets. We will stay in touch.
The time will come when you with all your other friends can do some-
thing. You will continue to have our support.
2
6. After the decision to de-fuse the Viaux coup plot, at least tempo-
rarily, Dr. Kissinger instructed Mr. Karamessines to preserve Agency
assets in Chile, working clandestinely and securely to maintain the ca-
pability for Agency operations against Allende in the future.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile
Papers, Church Committee, August 12, 1975. Secret; Sensitive; Eyes Only. Kissinger, Kar-
amessines, and Haig were present. The meeting took place at the White House. There is
no drafting information, but the memorandum is consistent in format with others pro-
duced by Karamessines. The original is in the Central Intelligence Agency, Job
80000012A, Chile Task Force Files.
2
According to an October 19 report on Track II: Station false flag officer met with a
leader of the Viaux group and attempted to discourage him from undertaking any pre-
mature coup move. Although the Viaux group had met on 16 October and decided to at-
tempt a coup on 21 or 22 October, they are probably not irrevocably committed to going
ahead with this plan. (Track II, October 19; ibid., Job 80000012A, Box 12, D/DP Task
Force Files)
378-376/428-S/80023
372 Foreign Relations, 19691976, Volume XXI
7. Dr. Kissinger discussed his desire that the word of our encour-
agement to the Chilean military in recent weeks be kept as secret as
possible. Mr. Karamessines stated emphatically that we had been doing
everything possible in this connection, including the use of false flag of-
ficers, car meetings and every conceivable precaution. But we and
others had done a great deal of talking recently with a number of
persons. For example, Ambassador Korrys wide ranging discussions
with numerous people urging a coup cannot be put back into the
bottle. [2 lines not declassified] (Dr. Kissinger requested that copy of
the message be sent to him on 16 October.)
3
8. The meeting concluded on Dr. Kissingers note that the Agency
should continue keeping the pressure on every Allende weak spot in
sightnow, after the 24th of October, after 5 November, and into the
future until such time as new marching orders are given. Mr. Karames-
sines stated that the Agency would comply.
3
Reference is presumably to Document 144.
153. Transcript of a Telephone Conversation Between President
Nixon and the Presidents Assistant for National Security
Affairs (Kissinger)
1
Washington, October 15, 1970.
[Omitted here is discussion unrelated to Chile.]
[P:] How about Ambassador Korry. Is there anything new?
K: I saw Karamessines today. That looks hopeless. I turned it off.
Nothing would be worse than an abortive coup.
P: Just tell him to do nothing. What I am afraid with the . . . that
Charlie Meir (phonetic) [Meyer] will get him in his clutches and con-
tinue a lot of AID and I am not going to do a thing for them. I wont
[continue that much aid there.]
2
K: They have not said that they are nationalizing any companies,
them or anything.
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 365,
Telephone Conversations, Chronological File. No classification marking.
2
These and all the remaining brackets except the final ones are in the original.
378-376/428-S/80023
September 5November 4, 1970 373
P: I think the line with him is to be coolly detached. After all he has
not been selected yet.
K: If he is . . .
P: Then we cut him off. Hickenlooper applies. This country has
gotten 2 million dollars. Worst [diplomatic mess we have gotten our-
selves into.]
K: You have said it all along and I was not at all sure until [until
just lately.] I had the Chilean Ambassador in today. He said is that what
we accomplished. Is that what we have worked for. [He is a very nice
man.]
3
[Omitted here is discussion unrelated to Chile.]
3
According to his Record of Schedule, Kissinger met with Santa-Maria from 5:12
until 5:50 p.m. (Library of Congress, Manuscript Division, Kissinger Papers, Box 438,
Miscellany, 19681976) No substantive record of the meeting has been found.
154. Telegram From the Central Intelligence Agency to the
Station in Chile
1
Washington, October 16, 1970, 1408Z.
1. Track Two policy, objectives, and actions were reviewed at high
USG level afternoon 15 October. Conclusions, which are to be your op-
erational guide, follow:
2. It is firm and continuing policy that Allende be overthrown by a
coup. It would be much preferable to have this transpire prior to 24 Oc-
tober but efforts in this regard will continue vigorously beyond this
date. We are to continue to generate maximum pressure toward this
end utilizing every appropriate resource. It is imperative that these ac-
tions be implemented clandestinely and securely so that the USG and
American hand be well hidden. While this imposes upon us a high de-
gree of selectivity in making military contacts and dictates that these
contacts be made in the most secure manner it definitely does not pre-
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile
CIA 1970. Secret; Immediate; Eyes Only. Drafted by Broe; authenticated by Phillips. The
telegram is printed from a previously redacted copy; the original was not found.
378-376/428-S/80023
374 Foreign Relations, 19691976, Volume XXI
clude contacts such as reported in Santiago 544
2
which was a masterful
piece of work.
3. After the most careful consideration it was determined that a
Viaux coup attempt carried out by him alone with the forces now at his
disposal would fail. Thus, it would be counterproductive to our Track
Two objectives. It was decided that CIA get a message to Viaux
warning him against precipitate action. In essence our message is to
state, We have reviewed your plans, and based on your information
and ours, we come to the conclusion that your plans for a coup at this
time cannot succeed. Failing, they may reduce your capabilities for the
future. Preserve your assets. We will stay in touch. The time will come
when you together with all your other friends can do something. You
will continue to have our support.
3
You are requested to deliver the
message to Viaux essentially as noted above. Our objectives are as
follows: (A) To advise him of our opinion and discourage him from
acting alone; (B) Continue to encourage him to amplify his planning;
(C) Encourage him to join forces with other coup planners so that they
may act in concert either before or after 24 October. (N.B. Six gas masks
and six CS cannisters are being carried to Santiago by special [less than 1
line not declassified] courier ETD Washington 1100 hours 16 October.)
4
4. There is great and continuing interest in the activities of Tirado,
Canales, Valenzuela et al. and we wish them optimum good fortune.
5. The above is your operating guidance. No other policy guidance
you may receive from State or its maximum exponent in Santiago, on
his return, are to sway you from your course.
6. Please review all your present and possibly new activities to in-
clude propaganda, black operations, surfacing of intelligence or disin-
formation, personal contacts, or anything else your imagination can
conjure which will permit you to continue to press forward toward our
[less than 1 line not declassified] objective in a secure manner.
2
Not found.
3
See Document 152 and footnote 2 thereto.
4
In an October 18 telegram, the Station requested 8 to 10 more grenades, three
sterile 45 caliber machine guns, and 500 rounds of ammunition for the Valenzuela group.
(Telegram 562 from the Station in Santiago to Headquarters; Central Intelligence Agency,
DO/LA Files, Job 80000012A, Box 6, Military, Vol. III, 16 October 1970) The CIA author-
ized the weapons that same day. (Telegram 856 from Headquarters to the Station in San-
tiago; ibid. and Track II, October 19; ibid., Box 12, D/DP Task Force Files) The guns
were delivered to the coup plotters on October 21. (Telegram 896 from Headquarters to
the Station in Santiago, October 22; ibid., Box 6, Military, Vol. III [16 Oct 1970])
378-376/428-S/80023
September 5November 4, 1970 375
155. Paper Prepared in the Department of State
1
Washington, October 16, 1970.
Action in Support of U.S. Posture Towards Chile
I. The courses of action recommended are posited on the following
assumptions:
A. Allende will be elected October 24th by the Chilean Congress in
a free and secret ballot by an overwhelming majority with the implicit
approval of the armed forces.
B. Allendes election will provoke no overt hostility from any Latin
American or Western European government and these governments
will accept in regional and multilateral organizations an Allende gov-
ernment as representative of a sovereign, independent Chile.
C. An Allende government will, despite reassuring articulations,
have a profound anti-American bias and will work against US influ-
ences in the country, the area, and the world.
D. An Allende government may for tactical reasons, wish to main-
tain its international credibility as a responsible debtor, as a trusted
borrower, and as a sovereign nation that fulfills its international obliga-
tions independent of any great power.
E. An Allende government will, at least in its first two years, en-
counter political opposition from anti-Communist forces and suffer
from internal tensions (between Socialists of Maoist beliefs and or-
thodox Communists loyal to Moscow seeking dominance, and between
non-doctrinaire opportunists and ideologues) in the management of a
much-bureaucratized government.
F. An Allende government will encounter serious economic
problems and perhaps particularly coincidental with the March 1971
nationwide municipal elections and two simultaneous Congressional
by-elections; such problems could exacerbate tensions within the gov-
erning coalition and increase the potential of anti-government forces.
II. The objectives of US policies should be:
A. To bolster by covert action those forces opposed to the establish-
ment in Chile of a Marxist-Leninist system.
1
Source: National Archives, RG 59, Central Files 197073, POL 15 CHILE. Secret;
Sensitive; Nodis. The paper was prepared for the upcoming October 17 Senior Review
Group meeting. See Document 158. A notation on the paper reads: prepared for SRG
10/17 + sent to SRG members 10/16. Another notation indicates it was seen by U, J,
ARA (Meyer), and S/PC (Eaton).
378-376/428-S/80023
376 Foreign Relations, 19691976, Volume XXI
B. To protect by quiet negotiation specific US interests in Chile so as
to demonstrate the effective capacity of the US to influence events and
so as to exploit to the maximum in defense of our legitimate interests
the desires of an Allende regime for legitimacy.
C. To deal publicly with the new Chilean Government in a manner
consonant with declared US policies for Latin America and to avoid
converting in the publics mind the triumph of Allende into a defeat for
this Administration.
III. Actions would be implemented at these three levelscovert,
diplomatic, and publicin the following ways:
A. Covert:
1. Financial support to anti-Allende forces to acquire and operate
radio stations and newspapers.
2. Financial support to selected anti-Allende leaders in the opposi-
tion parties.
3. Financial support to selected anti-Allende personalities in the
Armed Forces.
4. Acquisition of political assets within the Allende coalition.
5. Political action to exacerbate tensions between the disparate
components of the Popular Unity coalition.
6. Political action to encourage the flight of key Chilean technicians
and managers so as to hamper the operation of the economy and to
augment the political tensions.
7. Selected political action designed to maximize the opposition to
the Allende government in the March 1971 nationwide municipal elec-
tions and the simultaneous two Congressional by-elections.
8. Propaganda action to publicize in the world media any contra-
vention of Chilean constitutional guarantees of a pluralistic democracy,
any shortcomings of the Allende government, any tensions inside his
ruling coalition and to combat his planned denigration of his political
opponents.
B. Diplomatic:
1. Authorize the Ambassador to seek between October 24th and
November 4th by unpublicized negotiation with Allende firm and
quickly-provable commitments:
a. to meet Chiles financial obligations to US institutions, public
and private,
b. to write the nationalization laws for copper and banks (expected
to be submitted November 5 to the Chilean Congress) so as to assure
compensation of a kind and of a term that would obviate Hickenlooper
Amendment implementation or significant USG payments to private
US companies holding AID investment guarantees,
378-376/428-S/80023
September 5November 4, 1970 377
c. to delay full diplomatic recognition to North Vietnam, North
Korea and possibly East Germany (eschewing any effort on our part to
affect the full recognition of Communist China or Cuba),
d. that Chile will not provide military bases to any foreign power
or be used for the export of revolution via guerrilla training camps or
dispatch of such trainees to other countries.
The Ambassador should inform Allende that the US and probably
the hemisphere will look very seriously on any violation of the commit-
ments outlined in the foregoing paragraph d.
The Ambassador should inform Allende of pertinent US legisla-
tion that might come into play and its implications for our bilateral re-
lations, including our positions in multilateral organizations, if he were
to ignore our views concerning the matters raised in paras a through c
of this section.
2. Instruct the Department and the Ambassador to plan for the fol-
lowing unilateral actions:
a. Maintain a very compact A.I.D. presence that concentrates on
people-to-people relations (Title II humanitarian programs, exchanges
of students, small impact projects) and a very few technical assistants in
fields of interest to the US (e.g., health). All other technical assistance
will be phased out by quiet withdrawal and non-replacement over a
period of several months; all other A.I.D. activities will be reduced
commensurate with our obligations to the U.S. Congress to supervise
and to audit projects.
b. Continue to deobligate A.I.D. funds in the pipeline to the max-
imum practicable extent and, predicated on an acceptable negotiation
with Allende prior to November 4th, permit the disbursement of A.I.D.
pipeline funds (less than $30,000,000, of which a large amount is in irre-
vocable special letters of credit) in accordance with the conditions of
the original loans. (There has been only one A.I.D. loan of $2,500,000 for
student exchanges in the past two full years.)
c. Cancel all replacement plans for the Peace Corps (which has
been quietly reduced recently to some 90 volunteers) and assume the
phase-out of this program unless the Allende government requests in
writing its continuance.
d. Maintain the Military Group (maximum 13 officers and men)
until such time as the Allende government requests its elimination;
maintain the courses of training for Chileans in Panama and the US.
Permit the fulfillment of contracted military aid commitments (value
approximately $4,000,000 of which a significant part was paid by the
Chileans in cash).
e. Phase out quietly the entire AFTAC presence from its three loca-
tions in Chile (Easter Island, Punta Arenas and Quintero).
378-376/428-S/80023
378 Foreign Relations, 19691976, Volume XXI
f. Permit the continuance of the NASA station if the Chilean Gov-
ernment so requests in writing.
g. Reduce to the minimum possible the numbers of official Amer-
icans and local employees of all agencies of the US.
3. Instruct the Department of State to:
a. Arrange with the Export-Import Bank to service exporters under
a centralized review system.
b. Review loan applications to the Inter-American Development
Bank with a critical eye directed to the end use of funds authorized for
Chile and to inform the IDB through the US Director of this US posture,
particularly as it affects the use of the Fund for Special Operations.
c. Consult with the governments of Brazil, Argentina, Peru,
Mexico, Colombia, Venezuela, Uruguay, Guatemala and the Domin-
ican Republic on the nature of our public posture to the Chilean
Government.
C. Public Policy
1. President Nixon would implement our public policy of re-
strained relations with an Allende government by acknowledging his
election October 24th with a prompt and succinct cable of congratula-
tions that would emphasize the Chilean traditions of democracy and of
freedom.
2. The US would send a delegation to the inauguration of Allende
headed by Assistant Secretary Meyer.
3. The US Mission to the OAS would distribute to all members the
Presidents official statement on Allendes election and explain our
level of representation at the inauguration. (We would seek in Western
Europe, Japan and in Latin American capitals by diplomatic action to
avoid any extravagant delegations to the inauguration.)
4. The US Government would eschew all other public statements.
378-376/428-S/80023
September 5November 4, 1970 379
156. Paper Prepared in the Department of Defense
1
Washington, undated.
OPTION
Adopt a Restrained, Deliberate Posture to Demonstrate Disapproval and
Limit Allendes Freedom of Action.
1. StanceThis option would be posted on the belief that a satisfac-
tory modus vivendi is impossible, that confrontations are inevitable,
that it is in the U.S. interest to act in a deliberate way which avoids
over-reaction and maintains flexibility, but that it is also in the U.S. in-
terest to make U.S. opposition to a Communist government in South
America clear to Chile, the rest of Latin America, the USSR, and the
world.
2
2. An action program to support this stance could be as follows:
a. Alert Neighboring Governments
Act immediately through diplomatic channels to inform govern-
ments of Argentina, Brazil and Paraguay that we expect an Allende re-
gime to fall under Communist control, which would be dangerous to
our mutual security and as such should be prevented if possible.
b. Public Posture
(1) After October 24 election of Allende but before his inauguration
on November 4, declare at very high level that Chile has exercised right
of election but if the resulting regime falls under Communist control,
we would view it with grave concern as incompatible with the Inter-
American system.
(2) Maintain relations with Allende government, but make it pub-
licly clear that U.S. will use its power to impede Chilean military coop-
eration with the USSR or export of subversion. Convey this position
privately in unambiguous terms to the Soviets so that it is clear that vio-
lation will result in confrontation.
(3) Express this view in statements by appropriate Administration
officials and Members of Congress, possibly in a Congressional Resolu-
tion, and in diplomatic contacts.
1
Source: Central Intelligence Agency, Job 80000012A, Chile Task Force, LA/CPB
LA. Secret. Selden sent the paper to Vaky under cover of a memorandum stating, At-
tached is a new option under NSSM97 for consideration at the 17 October 1970 Senior Re-
view Group Meeting. (Ibid.) See Document 158. A copy was sent to Irwin.
2
In an October 8 memorandum to Packard, Nutter concluded that an Allende re-
gime would result in a diminution of U.S. prestige and influence in the rest of the
world. (Memorandum for the Secretary of Defense, October 8; National Archives, RG
330, 76067, Box 68, Chile, 1970)
378-376/428-S/80023
380 Foreign Relations, 19691976, Volume XXI
(4) Mount a massive USIS effort to explain this U.S. position.
c. Economic
(1) Insist on full compensation for any U.S.-owned property na-
tionalized by Chile.
(2) Apply appropriate provisions of the Foreign Assistance Act,
e.g. (paraphrase):
620(3)(b): No assistance to country dominated by international
Communist movement.
620(3)(c)(A): Suspend assistance to country that nationalizes, ex-
propriates or seizes property owned by U.S. citizens, and fails within
six months to agree to adequate compensation.
620(3)(f): No assistance to any Communist country without Pres-
idential waiver.
107(b): No economic assistance to countries trading with Cuba
or North Vietnam.
(3) Do not support rescheduling of Chilean debt.
(4) Veto Chilean requests for loans in IBRD, IDB, Ex-Im Bank be-
cause of Chilean expropriations and economic policies.
(5) Discourage U.S., third country, and multilateral private invest-
ment in Chile.
(6) Encourage U.S. labor organizations to take active role in op-
posing Communist Chilean government.
(7) Discourage tourism and travel to Chile, indicating that because
of anti-U.S. hostility we could not lend assistance in case of trouble.
Provide no assistance to Chilean airlines in obtaining equipment or
routes.
d. Military
(1) Maintain effective relations with the Chilean military, letting
them know that we want to cooperate but that our ability to do so de-
pends on Chilean government actions.
(2) Inform Allende that we plan no change in military cooperation,
but that U.S. public and Congressional reactions will be dictated by his
governments actions.
(3) Based on Allendes response to this position, and on his subse-
quent actions, take the following steps:
Military Assistance Program: Continue suspension of training,
MAP pipeline deliveries, and Foreign Military Sales pending Allende
reaffirmation of:
The Mutual Defense Assistance Agreement of 1952.
The Military Mission Agreement of 1964.
If he reaffirms, continue the programs on a minimum basis; if he
does not reaffirm, terminate.
378-376/428-S/80023
September 5November 4, 1970 381
Military Group: Continue military mission operations if the Mili-
tary Mission Agreement is reaffirmed within a reasonable time; be pre-
pared to withdraw the missions unilaterally if this is not forthcoming.
[4 lines not declassified]
Inter-American Security Organizations:
Utilize OAS to oppose Chilean violations of OAS charter and
resolutions.
Determine exclusion Chile from classified proceedings of IADB
and in hemispheric military conferences and exercises.
Maintain Surveillance of Chilean Ships Transiting the Panama Canal
(boarding guards, etc).
Impress on NATO allies their need to support our Western Hemi-
sphere Security Interests.
Ship Leases/Loans:
Inform Chilean military that we will have to recall the nine U.S.
vessels on lease/loan if U.S. security interests are affected by Soviet
presence (two destroyers, two submarines, five support ships).
Dramatically Increase Security Cooperation with other South Amer-
ican countries:
Offer to sell F4s to Argentina on favorable terms.
Provide selective MAP materiel for Argentina and Brazil.
Support the Argentine position in Beagle Channel controversy if
not settled.
Resume internal security assistance to Uruguay, Paraguay, and
possibly Bolivia, based on the threat of Chilean-exported subversion.
e. Psychological
(1) Give articulate support, publicly and privately, to democratic
elements in Chile opposed to Communist regime by all appropriate
means.
(2) Encourage major South American nations to effective opposi-
tion to Communist Chilean threat.
f. Take immediate steps to initiate fourth option (Annex)
3
by in-
forming Chilean military of our support, while at the same time ap-
proaching friendly governments of Argentina, Brazil and Paraguay to
suggest that they also act to convey their support to Chilean military.
3. Advantages. This option would demonstrate clearly U.S. opposi-
tion to a Communist government in South America. It might deter Al-
lende from his course or cause him to modify some of his more virulent
anti-U.S. attitudes and policies. At the minimum, it would slow his
3
Not attached. Regarding the fourth option, see Document 50.
378-376/428-S/80023
382 Foreign Relations, 19691976, Volume XXI
progress. It would permit us to retain a greater degree of initiative than
would the more passive options. It would convey firmness to Allende,
the USSR, and Latin America. It should serve to inhibit accidental con-
frontation with the USSR over Chile, and should inspire a strong, coop-
erative stance by the major South American countries. It would be psy-
chological stimulation to dissident elements in Chile, and could deter
the establishment of similar regimes elsewhere. By demonstrating
firmness, the policy would accrue wide U.S. public and Congressional
support.
4. Disadvantages: It is highly unlikely that this option would cause
Allende to abandon his fundamentally anti-U.S. course, and could pro-
vide him some basis to gain more support by claiming imperialist
pressure. Consequently, it could move many fence-sitters in Chile sol-
idly into the Allende camp. It could also prove disruptive to hemi-
spheric cooperation in dealing with the Chilean problem. We are not
likely to obtain complete third country agreement to refrain from in-
vestment in Chile. The option would not retain the same degree of flex-
ibility as the more passive options.
157. Paper Prepared in the Central Intelligence Agency
1
Washington, October 17, 1970.
SUBJECT
Talking Paper on TRACK I
A. Summary of Situation:
1. Unless there is a sudden economic crisis or a serious civil dis-
turbance, the Chilean military probably will not intervene and Sal-
vador Allende will be elected President on 24 October. Since the PDC
junta (34 October) Allende has been actively trying to: (1) counter the
negative image created by our propaganda campaign; (2) allay the fears
of the Brazilian and Argentine military; (3) make inroads into the
Chilean military; and (4) develop a modus vivendi with the PDC.
2. Despite Allendes efforts to improve the cohesiveness of his co-
alition and his relationship with the PDC, the National Plenum of the
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile
CIA 1970. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
September 5November 4, 1970 383
Socialist Party (PS) (910 October) expressed its opposition to any pact
with the PDC, and approved a resolution opposing efforts by the PCCh
to suppress the Leftist Revolutionary Movement (MIR). The PS
Plenums actions and Allendes belligerent pledge to strictly carry out
the UP program will complicate his efforts to unify his coalition and
maintain PDC support.
3. Meanwhile, President Frei has not entirely given up on the pos-
sibility of finding a political solution, but both he and the military seem
unable or unwilling to pull themselves together to deny Allende the
Presidency.
B. Actions:
1. All WH Stations and some European [less than 1 line not declassi-
fied] continue to produce propaganda items for placement and replay
throughout Latin America and Europe. Special newspaper and maga-
zine articles, editorials, and TV and radio broadcasts have intensified
the propaganda treatment of the Chilean situation. Much of this in-
crease can be attributed to Agency assets who were sent to Santiago for
the express purpose of developing prop articles for their newspapers.
2. The 12 [19] October Time Magazine cover story on Chile for
which the Agency provided background material provoked a special
attack from the Communists which appeared in the 16 October issue of
El Siglo.
3. Last minute briefings by [less than 1 line not declassified] Ambas-
sador Korry may have been responsible for Ex-President Lleras of Co-
lombia urging Frei to intervene in the PDC junta and do whatever pos-
sible to stop Allende.
4. Funds were approved [less than 1 line not declassified] to organize
non-Communist factions within the UP in opposition to the PCCh.
5. [less than 1 line not declassified] a six-page daily newspaper (10,000
copies) sponsored by the PDC Women Against Allende organization.
This paper, Pueblo Libre, attacks Tomic and Prado for their support of
Allende and attempts to promote PDC abstention on 24 October.
6. Santiago Station has reactivated the sewage press and is dis-
tributing anti-Allende materials to government officials, Armed Forces,
municipal officials and Congressmen.
378-376/428-S/80023
384 Foreign Relations, 19691976, Volume XXI
158. Minutes of a Meeting of the Senior Review Group
1
Washington, October 17, 1970, 9:0210:42 a.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger
State CIA
Under Secretary John Irwin Lt. Gen. R.E. Cushman
Ambassador U. Alexis Johnson Mr. Thomas Karamessines
Mr. Charles A. Meyer Mr. William Broe
Ambassador Edward M. Korry
NSC Staff
Defense B/Gen. Alexander M. Haig
Mr. G. Warren Nutter Mr. Viron P. Vaky
Mr. Armistead I. Selden, Jr. Col. Richard T. Kennedy
Mr. Raymond G. Leddy Mr. D. Keith Guthrie
JCS
Adm. Thomas H. Moorer
B/Gen. Joseph H. Belser
SUMMARY OF CONCLUSIONS
1. An NSC meeting is to be scheduled as soon as possible after the
US elections (probably on November 5) to discuss United States policy
toward the Allende government. A preparatory Senior Review Group
meeting will be scheduled prior to November 5.
2. The State Department will submit by October 20 a memo-
randum setting forth the immediate operational issues that must be de-
cided in connection with Allendes election and inauguration. These in-
clude a possible US statement at the time of Allendes election on
October 24, negotiations with Allende prior to his inaugural, the com-
position of the US delegation to the inaugural, and the resumption of
US military equipment deliveries to the Chilean armed forces.
3. Under Secretary Irwin will provide a statement of his views on
the basic issues and alternatives involved in deciding what course of
action the United States should adopt in dealing with the Allende
government.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H48, Senior Review Group, Chile (NSSM 97), 10/17/70. Se-
cret; Sensitive; Nodis. A copy was sent to Kennedy, Vaky, and Nachmanoff. An attached
distribution sheet indicates that Kissinger saw these minutes. The meeting took place in
the White House Situation Room. All brackets are in the original.
378-376/428-S/80023
September 5November 4, 1970 385
Dr. Kissinger: Our meeting today is to discuss the two different
courses of action prepared by State and Defense.
2
We [the NSC staff]
have tried to work out yet another possible proposal.
Let me sum up where we stand in our discussions. As I under-
stand, there is a measure of consensus that an Allende government is
likely to affect US interests adversely in a number of ways. It will op-
pose the US in the Hemisphere. It will promote a third-world neutralist
stance among the nations of Latin America. It will establish linkages to
the USSR, Cuba, and the socialist world. It will encourage elements op-
posed to the US in other parts of Latin America. It will expropriate US
investments valued at $700 million.
Ambassador Korry: The value is actually about $1 billion.
Dr. Kissinger: Also an Allende government will default on debts
owed to the US Government and to American banks.
Ambassador Korry: That would amount to another $1 billion.
Ambassador Johnson: Of the $1 billion in US direct investment,
$380 million is subject to US Government investment guarantees.
Ambassador Korry: $800 million of the $1 billion debt is owed to
the US Government.
Dr. Kissinger: On the military side, an Allende government would
not itself affect the world balance; but if it made facilities available to
the Soviet Union, it would add to Soviet capabilities. This would call
for development of a counter-capability on our part. In addition, an
Allende government might accept Soviet military equipment for its
armed forces.
There are other factors we should consider. An Allende govern-
ment starts in a weak position. Allendes coalition is fractious. There is
rivalry between the Socialists and Communists, and in some ways the
Socialists are more radical than the Communists. Allende may face
mounting economic problems between now and March. The Chilean
military is suspicious of him. Allendes own game plan will almost cer-
tainly be to seek legitimacy and respectability, to keep the opposition
fragmented, and to demolish it bit by bit. If we are publicly or prema-
turely hostile, our attitude may rally Chilean nationalists behind Al-
lende. If, on the other hand, we are accommodating, we risk giving the
appearance of weakness or of indifference to the establishment of a
Marxist government in the Hemisphere.
What I got out of the meeting the other day is that no one believes a
long-term accommodation is possible.
3
We are faced only with a choice
in tactics. The question is whether it would be better if a confrontation
2
See Documents 155 and 156.
3
See Document 150.
378-376/428-S/80023
386 Foreign Relations, 19691976, Volume XXI
were seen to result from Allendes actions or whether the US should
move immediately to a position of militant hostility.
States option is to let Allende make the decision on when and how
there will be a confrontation with the United States. Defense wants to
move right away toward overt hostility. We [the NSC staff] have put to-
gether a third option.
First, lets review the existing options. Ed [Korry], do you want to
add anything about your proposal? Perhaps you could summarize it
for us.
Ambassador Korry: I should point out one slight permutation.
That concerns what is meant by non-hostility. Under our approach,
there would be hostility, but it would not be overt. Ours is a three-level
approach. The US public policy would be one of restraint; however, our
covert policy would be one of active opposition. The third level would
involve diplomatic negotiations based on a position of firmness and
seeking to extract for the protection of our interests whatever agree-
ments we can from Allende while he is in a weak position.
We have spelled out in our paper what is involved on the covert
side. As regards diplomatic negotiation, I remain convinced that Al-
lende very much wants respectability and that this will enable us to ob-
tain many of the things listed on Pages 4 and 5 of our paper.
From the standpoint of our public posture, there would be a reduc-
tion in the US presence in Chile with the exception of the military mis-
sion. A small AID mission would be retained. The cutback would pro-
vide a public indication of our hostility to the regime.
Dr. Kissinger: What about the Defense paper?
Mr. Leddy: Its general thrust is to take a somewhat stronger posi-
tion than proposed by State. We would alert neighboring governments
to the danger that an Allende government would fall under Commu-
nist control. After October 24 we would publicly reiterate our position
that establishment of a Communist government in the Hemisphere is
incompatible with the Inter-American system. Once Allende has taken
office, we would seek to maintain relations with Chile but would at the
same time make clear to Allende that if Chilean territory is made avail-
able for a Soviet military presence or for the export of revolution, we
will use our power against him.
Dr. Kissinger: How?
Mr. Leddy: That is a delicate question. What would be involved
would be our power with Chiles neighbors and with Allende himself.
Dr. Kissinger: What power do we have with Allende?
Mr. Leddy: His desire for respectability and his desire not to jump
into the Communist camp.
378-376/428-S/80023
September 5November 4, 1970 387
Dr. Kissinger: As far as I can see, the major difference between De-
fense and State is that Defense doesnt want to open a negotiation with
Allende between October 24 and November 5.
Mr. Leddy: No, the major difference is that Defense advocates a
public position of opposition to Allende.
Ambassador Korry: Other governments have already been in-
formed through their Ambassadors about our views on Allende.
Dr. Kissinger: On our European trip, I got the impression that the
Europeans were confused about our attitude.
Ambassador Korry: They should have known. The Italian Ambas-
sador had been told and should have reported to his government.
Dr. Kissinger: As far as negotiations are concerned, we need to
consider who takes whom. What does Allende gain from negotiations
in terms of legitimacy and respectability? For us, the first question in
dealing with Allende is whether our hostility should be in response to
actions taken by him or should result from our own initiative. If we de-
cide that hostility is to emerge as a response to Allendes actions, then
we face a second questionwhether we want to negotiate with him or
merely maintain a cool, correct posture. If he makes a hostile move, we
can consider taking some of the steps Defense is advocating. If he takes
a moderate approach, we can try States course of action. But we dont
want to rush in on October 24 to begin negotiations with him.
Ambassador Korry: We are not offering him anythingexcept
overt non-hostility.
Dr. Kissinger: Why would he want that?
Ambassador Korry: Our non-hostility, at least publicly, could be
useful to him at the time he takes office.
Dr. Kissinger: Then we do have some leverage with him. What do
we gain?
Ambassador Korry: We can keep himfrom getting locked in on the
expropriation of the copper industry.
Mr. Karamessines: Negotiation is perhaps the wrong term to use
for what State is proposing. What we would be doing is warning him
about the consequences of taking action against US interests.
Ambassador Korry: Certain steps have already been taken. Private
sources of credit have dried up. We have suspended military assistance
deliveries and processing of Export-Import Bank credits.
Dr. Kissinger: Threatening him about non-compensation seems a
weak position. After 25 years of effort he didnt get to power in order to
be snookered. We have to offer him something he wants if we are to get
anything from him.
Ambassador Korry: We have to remember that he really doesnt
know much about the United States. He does worry about what we
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388 Foreign Relations, 19691976, Volume XXI
might do to him. He is thinking about CIA activities, economic pres-
sures, and threats to Chilean export markets.
Dr. Kissinger: Since you are going to go ahead with covert opera-
tions aimed against him anyway, he will think you are bluffing or de-
ceiving him if you talk to him about non-hostility.
Ambassador Korry: He hasnt attacked the Administration yet.
Dr. Kissinger: Of course not. He doesnt want to rock the boat be-
fore his inauguration.
Ambassador Korry: He doesnt know about our intelligence activ-
ities. He hasnt been in power.
Dr. Kissinger: He will find out. I cant imagine that it will take him
very long. (to Cushman) What do you think?
Lt. Gen. Cushman: He may not be able to come up with definite
proof that we are working against him. But he will know that we have
some sort of an operation under way.
Mr. Leddy: There have already been public charges of a CIA cam-
paign against him.
Ambassador Korry: That has been going on for years.
Dr. Kissinger: How do we approach him?
Ambassador Korry: One possibility is to remember that West Ger-
many is Chiles biggest customer and its second largest creditor.
Dr. Kissinger: The FRG has already for all practical purposes rec-
ognized East Germany. The non-recognition policy will not last much
longer. That wont help us with Allende.
Ambassador Korry: He is likely to be under serious economic pres-
sure in about six months.
Under Secretary Irwin: If an Allende government runs into trouble
in its own country, it is preferable that its failure be recognized as a
product of its own system and mistakes. It will be to our advantage if
we can avoid being put in a position where he can blame us for his
troubles and gain acceptance for this charge in Chile and elsewhere in
Latin America.
Dr. Kissinger: That point is relevant to our first issuewhether we
should take the initiative in adopting a position of overt hostility.
Under Secretary Irwin: It seems to me the question of negotiating
with him is not too critical. If negotiation were successful, it would be
important not so much because of the recognition it accorded him but
because it might make the expropriation problem less difficult. It might
avoid setting an undesirable precedent that would encourage others to
expropriate and could also help us avoid getting into complications
with Allende on the application of the Hickenlooper Amendment.
What Ed [Korry] is trying to doand I admit I am a bit skeptical that it
378-376/428-S/80023
September 5November 4, 1970 389
can be doneis to pass information to Allende so that he would know
what he is getting into.
Dr. Kissinger: Doesnt Allende have an interest of his own in not
provoking a crisis during his first week in office?
Under Secretary Irwin: Ed is trying to play on that.
Dr. Kissinger: Why do we need to play on it?
Ambassador Korry: All you do is warn him about the conse-
quences of the actions he might take after November 4.
Dr. Kissinger: There is a difference between saying that and prom-
ising him legitimacy and non-hostility. In the latter case, you put him in
a more favorable position to retaliate against us if we go ahead with co-
vert operations.
Under Secretary Irwin: If we entered into negotiations with him
and told him that we would be hostile unless he provided satisfactory
compensation for nationalized investments, we would be putting him
in a position of control. We might have to back down. It would have to
be handled very carefully.
Dr. Kissinger: Thats right. Can we restate the proposition. As I
understand it, we promise non-overt hostility in return for non-
recognition of North Korea, North Vietnam, and East Germany, not al-
lowing the Soviets to have bases in Chile, refraining from export of rev-
olution, and payment of compensation for expropriated properties.
Ambassador Korry: We are only going to inform him about the ap-
plicable US laws.
Dr. Kissinger: The question of Soviet bases has nothing to do with
law.
Ambassador Korry: Thats correct.
Adm. Moorer: The question is whether or not you talk to him.
Dr. Kissinger: Or how you talk.
Ambassador Korry: Since he would know our position, he would
not be operating under any false assumptions.
Dr. Kissinger: Everyone agrees that Allende should not act under
any misapprehension of the consequences.
Ambassador Korry: Negotiation is an implicit as well as an explicit
word. Whatever you say to Allende will generate some reaction. That is
why it amounts to negotiation.
Dr. Kissinger: All you would tell him is what you know about US
laws and policies. Is anyone opposed to this if it stops at that and we do
not promise him anything?
Under Secretary Irwin: Ed is trying to trade on Allendes hope of
avoiding an initial confrontation with the US.
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390 Foreign Relations, 19691976, Volume XXI
Mr. Selden: What Allende needs is time. The more time we give
him, the better off he will be. He will certainly agree to putting off a
confrontation. But what would we be accomplishing except to give him
more time?
Under Secretary Irwin: We will have to make a judgment on the
risks and counter-risks.
Dr. Kissinger: But what do we get out of a modus vivendi with
him? In six months he will have consolidated his position and will
move against us.
Under Secretary Irwin: Possibly by then he will have gotten into
internal economic and political troubles.
Ambassador Johnson: Perhaps we will gain something in pro-
tecting our economic interests.
Dr. Kissinger: The President doesnt care about compensation. He
will pay his $300 million if Allende can be brought down.
Our discussion seems to indicate that overt hostility would
strengthen Allende, whereas overt non-hostility would maximize the
possibility that internal problems would undermine him. By negotiat-
ing with him, you would tell him how to get hostility, and he could
generate it whenever it suited him best.
Ambassador Korry: He already knows how to produce hostility
from the US, but he doesnt know whether the US is serious about pro-
tecting its interests. He reads the statements put out by Sol Linowitz
and Ralph Dungan. It would be useful to restate what ought otherwise
to be obvious to him.
Dr. Kissinger: But the obvious [i.e., hostility] is what he wants.
Ambassador Korry: It is his choice whether there is to be hostility
or not. That is why talking to him would be a negotiation. Within his
own camp, there are differences on how we should proceed.
Mr. Vaky: If you talk to him about not exporting revolution and
not permitting Soviet bases, dont you box yourself in? Suppose you get
evidence of the transit of terrorists through Chile, or suppose a Soviet
flotilla arrives in a Chilean port. You then find yourself forced to react.
Ambassador Korry: There are many things you could do.
Mr. Vaky: We would be putting ourselves on the hook.
Ambassador Korry: You dont tell him anything about what we
might do.
Dr. Kissinger: The question is how you do that.
Lt. Gen. Cushman: Castro has advised Allende to play it cool in
dealing with the US.
Dr. Kissinger: Castro played it cool when he started out. Are we
going to do the same with Allende as with Castro?
378-376/428-S/80023
September 5November 4, 1970 391
Lt. Gen. Cushman: If he moves to a police state rapidly, it will limit
our capability to carry out covert operations.
Dr. Kissinger: Our judgment is that he cannot move rapidly to a
police state. Just playing the devils advocate, I wonder whether if we
could get him to move faster toward a police state, we might get the
army to take action sooner.
Ambassador Korry: There is no need for him to move rapidly
toward a socialist state. He has a well organized cellular political orga-
nization already in existence to carry out his objectives whenever he
wishes. To the extent that the US manifests hostility, the internal polit-
ical structure supporting him may be strengthened.
Mr. Nutter: Allende has to have a power base. He will need to have
control of the army and the police.
Ambassador Korry: After observing how Chile got into its present
situation, I wouldnt rely too much on the military.
Dr. Kissinger: I dont follow your theory. Is it foreordained that Al-
lende will triumph? Are we just playing tactics? The discussion seems
to be polarizing between a policy of overt hostility and a vague concept
of negotiation, which involves telling him things he should not do.
Ambassador Korry: He will nationalize the copper industry right
away. His objective is to clean out the whole US presence. Whatever we
do in the Inter-American Development Bank on Chilean loan applica-
tions will show our attitude.
Dr. Kissinger: I dont quarrel with informing him of the conse-
quences of his action.
Under Secretary Irwin: That is merely a tactic, which we can either
use or not. The important issue is the choice of a general approach. The
State proposal is to maintain correct relations and non-overt hostility
while employing CIA covert operations to undermine him. The De-
fense proposal is similar although the emphasis is different. It calls for
more open hostility but would not call for much more action than the
State proposal. A third course, which I thought would be the Defense
position, is to take a wide range of actions to combat him.
A potential danger is that if we base our hostility upon words, we
will wind up with the worst of both worlds. We would not enjoy the
advantages of maintaining a cool, correct posture, and we would not be
taking any action to back up our position of hostility. We would also be
lending legitimacy to the claims he might make about CIA activities di-
rected against him.
Dr. Kissinger: That is a good summary of the problem.
Mr. Nutter: Are there some other actions we havent mentioned
that we might take? In preparing our paper, we tried to identify all pos-
378-376/428-S/80023
392 Foreign Relations, 19691976, Volume XXI
sible measures other than a break in diplomatic relations or military
hostilities.
Dr. Kissinger: One can agree that overt hostility might hamper co-
vert action. On the other hand, if we merely adopt a cool and correct
stance, we could create confusion about our position in other parts of
Latin America. When we visited Italy, the Vatican, and Britain on the
Presidents trip, we found that there was an impression that we had
washed our hands of Chile. We ought to be in consultation with the
Latin Americans about this.
Under Secretary Irwin: I agree.
Mr. Selden: The American people have to be clear about our posi-
tion too.
Ambassador Johnson: Our concern is not with labels but with ac-
tions. It is not so important to say that there is a Communist or Marxist
regime in Chile as to be able to demonstrate that what we do is a result
of actions the Allende government took against us. For example, it
would make a difference whether we freeze Chilean assets on No-
vember 4 or after US properties have been expropriated without
compensation.
Ambassador Korry: I would agree with that. However, if we rely
on Anaconda to provide a justification for our actions, we would be on
the weakest possible ground, given the companys poor record.
Dr. Kissinger: How are we going to avoid this if we go to him and
say that if you nationalize Anaconda, we will react.
Ambassador Korry: I believe we can get a deal that will protect our
interests.
Dr. Kissinger: What do we offer him?
Ambassador Korry: We would make clear in a convincing way
that we are seriously considering some of the measures set forth in the
Defense paper.
Dr. Kissinger: Suppose he says: You cannot buy a dedicated
Marxist with pressure. We are then back to defending Anaconda, and
that would be fighting on weak ground.
Ambassador Korry: What do we have to lose? We can at least try to
raise maximum doubts in his mind.
Dr. Kissinger: The advantage of talking to him would be to raise
doubts about how he ought to respond. The disadvantage is that he
may react strongly if we march in threatening him about Anaconda just
after he has been elected.
Ambassador Korry: We would not talk about nationalization.
We would merely try to establish the parameters of adequate
compensation.
378-376/428-S/80023
September 5November 4, 1970 393
Mr. Vaky: Then we would be negotiating with him.
Dr. Kissinger: He might say: Yes, but in return you do twenty
other things.
Ambassador Korry: We dont have to give him anything.
Dr. Kissinger: I wish I had a dollar for every meeting in which
someone has announced that a given proposal will not cost us
anything.
Ambassador Korry: If a historical example is needed, you can take
our postwar rapprochement with Tito.
Dr. Kissinger: But Tito needed us.
Ambassador Korry: Allende also needs us.
Dr. Kissinger: If he needs us, he will come to us.
I can understand not carrying the fight to him. However, the key
question is whether we help him prove his acceptability or wait for him
to demonstrate it to us.
Mr. Meyer: But if he demonstrates his acceptability, we will not be
in any position to work for his overthrow.
Mr. Nutter: Is it our judgment that he is going to establish a com-
munist state?
Ambassador Johnson: He may prefer coexistence, perhaps a Yugo-
slav type of relationship. If this indeed is what he wants, do we tolerate
him? If he reacts to Eds [Korrys] proposals, what do we do then? I
gather that we want to continue supplying military equipment to the
Chilean armed forces and that we would not block IDB loans for Chile.
Dr. Kissinger: Would we continue our covert operations?
Ambassador Korry: Yes.
Mr. Nutter: I dont think he will go the Yugoslav route.
Dr. Kissinger: We ought to understand what the Yugoslav route
means. In the Balkans Tito is helpful to us. In Latin America he would
be a threat. Castro is more of a problem to us as an independent force
than as a complete economic satellite of the Soviet Union.
Ambassador Korry: An Allende government will provide the
same type of problem as Castro, that is, the existence in the Hemisphere
of a statist regime with a strong anti-US bias. The question is how we
limit its influence. Of course, we should remember that nothing follows
a logical pattern. Unexpected developments always occur. In dealing
with Allende we need maximum flexibility.
Dr. Kissinger: That reminds me of the statement Chip Bohlen
made at a White House dinner: If you dont know where you are
going, any road will get you there. Where are we going in Chile?
Ambassador Korry: We are seeking to maximize internal tensions
in Chile and to signal our position on the international scene. All we
378-376/428-S/80023
394 Foreign Relations, 19691976, Volume XXI
would do in conversations with him prior to his inaugural would be to
try to keep him from getting locked into positions hostile to US
interests.
Dr. Kissinger: Jack [Irwin] has stated the issues. The first question
facing us is whether our position should be one of overt hostility or
cool, correct relations. If the decision is to follow a cool, correct course,
then we must answer a second question: to what extent do we want to
let him buy time? This involves deciding how far we want to go in
taking the initiative by undertaking negotiations with him.
Regarding Alexs [Johnsons] question about relations with the
Chilean military, is it in our interest to give Allende the time he needs?
We may want to keep up the pressure.
Ambassador Johnson: We may want to try to maintain a relation-
ship with the military, and that will give him more time. But if we cut
the military off completely, they will have no choice but to turn to the
Soviets.
Dr. Kissinger: Or move against Allende.
Ambassador Korry: They would not do that unless a coup could be
justified by Allendes own actions.
Mr. Leddy: Our [the Defense Department] proposal is not for com-
plete hostility. We merely feel that we should have a position toward
Chile on the public record. For example, we could issue a statement on
November 5 warning of our concern if a Communist government
emerges.
Ambassador Johnson: What do you mean by a Communist
government?
Mr. Leddy: One that is under Communist control.
Under Secretary Irwin: What do you want to achieve? Allendes
overthrow?
Mr. Leddy: That is a hard question. The consensus seems to be that
either we dont have the leverage to bring him down or that we should
just seek to slow him up.
Under Secretary Irwin: I am not sure whether slowing down estab-
lishment of a Communist government is the basic point. The key ques-
tion is whether the US Government has the capability to overthrow Al-
lendeimmediately, within six months, or a year from now. If the US
does not have sufficient leverage, then can we so plan our actions so as
to facilitate his overthrow? The trend of US actions in Latin America
raises a question whether we do in fact have the ability to bring about
his overthrow. We pulled back from the Bay of Pigs. We went only half
way in the 1962 Cuba missile crisis. We pulled back from a confronta-
tion with the Peruvians over IPC.
378-376/428-S/80023
September 5November 4, 1970 395
Latin America wants social, economic, and political reform as well
as greater independence from the United States. Both factors are at play
in the Chilean case. In this context, what ability do we have to do any-
thing? Can we consider the sort of action we took in the Dominican Re-
public? I question whether we can. Military action of this sort is polit-
ically improbable.
Under these circumstances, what is the best position for us to take
vis-a`-vis the Allende government? We can do whatever we can to
achieve his overthrow, but our assets are limited. We should certainly
not help him economically, although we may in some cases want to
make an exception in the IDB, where we may not want to be in the posi-
tion of blocking Chilean loan requests.
The premise of my thesis is that we should look not only at what
we are in a position to do to undermine an Allende government but
also at what that government is likely to do in Chile to contribute to its
own downfall. If we dont have the capability to bring about Allendes
overthrow, we should so conduct ourselves so that he cant blame us
for his failures. We should let his own mistakes accumulate. If he does
not fall, he will be a bad example for the rest of Latin America.
Dr. Kissinger: That is a good statement. We can always buy time.
However, the impact of a Communist government communizing a
Latin American country with the tacit cooperation of the United States
will be disastrous in other Latin American countries. Allende might be
better off if he moved slowly rather than sought a confrontation. It is
not self-evident that a moderate but uncompromising Allende would
not be more dangerous to us than an implacably Maoist Allende. We
might prefer to trigger a confrontation.
Ambassador Korry: Cant we in effect do both? We can negotiate
with Allende prior to November 4, we can cut down on aid, we can
carry out our contractual obligations on military assistance, and at the
same time we can extract compensation.
Dr. Kissinger: What kind of compensation? Compensation is not
the important issue.
Ambassador Korry: I think we should do something to keep the
US taxpayer from having to foot the bill for a Communist governments
expropriations.
Dr. Kissinger: I really think that Chile is perhaps the most impor-
tant issue we have had to deal withmore important, say, than Jordan.
Mr. Nutter: We have discussed whether we can get along with an
Allende government over the long run. The Chilean military is asking
the same questions, and they may conclude that the answer is yes. Al-
lende must solidify his power base in Chile, and that means gaining
control of the military. When he tries thatand the military see their
own survival at stake, we can get a coup.
378-376/428-S/80023
396 Foreign Relations, 19691976, Volume XXI
Under Secretary Irwin: I dont disagree.
Dr. Kissinger: We need to give the principals a chance to talk over
the issues just as we have been doing. We cannot decide this. We will
need an NSC meeting, but because of the Presidents schedule, we cant
have one until after the election. (to Irwin) Would you write up a state-
ment of the choices as you posed them before?
We will try to make decisions on the immediate operational ques-
tions. Should we communicate with Allende prior to his inauguration?
Adm. Moorer: The first question is what the US Government says
on October 24.
Dr. Kissinger: We need to get a list of the operational decisions re-
quired. We will try to schedule an NSC meeting for the first possible
day after November 3.
Gen. Haig: That would be November 5th.
Dr. Kissinger: All right. We will need to be well prepared for the
meeting. Can we have a memorandum by Tuesday [October 20] on the
immediate operational decisions.
Ambassador Johnson: These would include what the US says on
October 24, whether Ed [Korry] sees Allende between October 24 and
November 5 and what he should say, and who goes to the inaugural.
Ambassador Korry: Do we hold military deliveries in abeyance
until after we see what Allende does about nationalizing the copper
industry?
Under Secretary Irwin: That is a question of tactics.
Dr. Kissinger: The purpose of holding up deliveries is to put pres-
sure on the military. I can see some advantage to resuming military de-
liveries when Allende is inaugurated.
Ambassador Korry: This needs to be included on the checklist of
immediate operational decisions. We could do it on the 24th.
Mr. Vaky: Why should we relate resumption to October 24?
Ambassador Johnson: That is a good point.
Under Secretary Irwin: I dont disagree with Warrens [Nutters]
statement about the role of the Chilean military. I also dont disagree
with Henrys [Kissingers] point about the possible advantages of trig-
gering a confrontation.
Dr. Kissinger: The important thing is that we not do anything be-
fore November 5 that would preclude that possibility. We probably
ought to have another Senior Review Group meeting before the NSC
on November 5. This is the most important issue we have had, even
though it is undramatic.
Ambassador Johnson: We will do a memorandum on the opera-
tional decisions.
378-376/428-S/80023
September 5November 4, 1970 397
Dr. Kissinger: We need a paper covering Jacks [Irwins] three
questions.
Mr. Meyer: Felipe Herrera had agreed earlier that no controversial
Chilean loans would be brought up for decision in the IDB before No-
vember 4. Now he has changed his position and is going ahead. We
have told our representative not to vote.
Dr. Kissinger: But that wont stop the loans.
Mr. Meyer: Yes it will. They cannot act if we dont vote. Our dele-
gate will say he is without instructions.
159. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, undated.
SUBJECT
ChileImmediate Operational Issues
It now appears certain that Allende will be elected President of
Chile in the October 24 Congressional run-off elections. He will be
inaugurated November 3. The Senior Review Group is now working
on the formulation of a specific strategy to deal with an Allende
government.
We can assume that Allende has a profound anti-American bias
which will lead him to work against our influence in the hemisphere
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Sensitive. Sent for action. The memorandum is attached to an October 18
memorandum to Kissinger in which Vaky noted, Since it had to cover a number of com-
plex tactical issues it is unavoidably long. If you think it too long it could be divided at the
end of the fifth paragraph on page 3. The first part could then be a memo on the general
nature of the problem leading to a recommendation the President agree to an NSC
meeting November 5, and the latter part a memo asking his decision on the tactical ques-
tions we have. Korry wants State to seek a presidential decision on phasing out other pro-
grams and personnel, and States memo may contain that. It seems to me, however, that
this is part of the longer strategy to be considered later. There is no reason why the Presi-
dent has to make a decision on this in the next few days. We could not make it evident in
Chile until after the November 3 inauguration anyway. An exception to this is the Air
Force atmosphere-testing unit (AFTAC), which because of the classified nature of its mis-
sion and the tenuous legal basis for its presence in Chile, is a special case. Hence, I have
added that issue to the memo. The fifth paragraph on page 3 is the one that begins
There are a variety of game plans which could be constructed . . . The memorandum
from the Department is presumably the Options Paper attached to Document 30 in For-
eign Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
398 Foreign Relations, 19691976, Volume XXI
and elsewhere. The consolidation of power by an Allende government,
therefore, is likely to affect a number of US interests adversely:
a. An Allende government is likely to lead opposition to US influ-
ence in the hemisphere, to promote policies counter to ours and to seek
the adoption of a neutralist Third World stance by Latin America.
b. It is likely to seek linkages to the Soviet Union, Cuba and other
socialist countries; Chile could thus constitute another entry point for
these countries influence and activities in the area.
c. Allende will almost surely expropriate US investments sooner or
later; whether he will also compensate adequately is not clear.
d. The successful existence of a Marxist government in Chile is
likely to encourage elements opposed to us in other Latin American
countries, and to provide a psychological boost to those who argue for
closer ties with the Soviets or who seek a Marxist pattern for their
societies.
The formulation of a strategy to contain or eliminate these threats
must also take into account: a) the nature of the present situation in
Chile and of Allendes internal position, and b) Allendes own specific
game plan:
a. Allende starts his term with an initially weak position:
the coalition that supports him is heterogeneous and fractious,
with significant friction between the Communists and Socialists;
the economic situation is deteriorating, placing strong economic
restraints upon his capacity to succeed;
he is a minority president, and there will be strong opposition to
any move toward a totalitarian state;
the political process is cumbersome and it is, therefore, difficult
for Allende to consummate a take over quickly; there is opportunity
for effective political opposition within the systemif the opposition acts
decisively;
the military is suspicious of him.
b. To meet these weaknesses, Allendes game plan will almost
certainly seek legitimacy and respectability; to reassure the apprehen-
sive or concerned and to move carefully to avoid coalescing opposition
to him prematurely; to keep his opposition fragmented and then slice
their power bit by bit as he is able. Left to his own game plan and pace
he probably has the capacity and skill to consolidate his power and
neutralize his opposition in a year or two.
It is clear that Allende is not voluntarily going to modify his goals,
nor is he likely to have any interest in negotiating such a modification
just to get along with us. A US policy of seeking accommodation with
him, therefore, is unlikely to deter him from an anti-US course if he
wants and is able to take it.
378-376/428-S/80023
September 5November 4, 1970 399
We have been led to conclude, therefore, that only some kind of
adversary strategy promises to contain or deter effectively the adverse
impact on our interests of an Allende regime. The question is what kind
of posture this requires and what degree of hostility.
Our capacity to engineer Allendes overthrow quickly has been
demonstrated to be sharply limited. The question, therefore, is whether we
can take actioncreate pressures, exploit weaknesses, magnify obstacles
which at a minimum will either insure his failure or force him to modify his
policies, and at a maximum might lead to situations where his collapse or over-
throw later may be more feasible.
There are theoretically, two approaches such a strategy might take:
One would be a frankly overtly hostile policy, utilizing all pos-
sible pressures and demonstrating that hostility openly;
The other would be a publicly correct but cold posture, with
pressure and hostility supplied non-overtly and behind the scenes,
and hostile measures demonstrated publicly only in reaction to
provocation.
Both courses would use essentially the same measurese.g., CIA
activity, economic and diplomatic pressures. The differenceand the
issuelies in the question of how overt our hostility should be.
The overt course has the merit of demonstrating our position openly
and unambiguously, both domestically and abroad. Its defect is that its
very overtness may make it self-defeating. A US position of public con-
frontation and a visibly punitive policy is almost sure to galvanize the
forces of nationalism into Allendes greatest asset both within Chile
and in the rest of Latin America. It moreover gives him the opportunity
to blame us for his failures or weaknesses and thus escape some of the
consequences of his own mistakes.
The merit of the non-overt course is that while it also utilizes the same
kinds of pressure and hostility it promises to increase their effec-
tiveness by avoiding the risks inherent in public hostility. It is in a sense
the converse of Allendes game planjust as he would avoid public
postures that would alarm and coalesce his opposition, so this strategy
would seek to avoid public postures that would give him a way to
blunt the effect of our pressure. Its defect is that it requires some fine
tuning and may seem less vigorous to our friends.
There are a variety of game plans which could be constructed to
illustrate and implement each of these two broad approaches. A deci-
sion as to basic strategy and an action program for Chile will be of
major importance and will have long-range and far-reaching implica-
tions in Latin America and elsewhere. For that reason, the Senior Review
Group strongly recommendsand I concurthat this question be considered
by the NSC and that a meeting be held as soon as your schedule permits.
378-376/428-S/80023
400 Foreign Relations, 19691976, Volume XXI
While you do not have to make a basic decision as to strategy and
program now, there are a few tactical issues on which a decision is re-
quired in the next few days. These are outlined below, and recommen-
dations regarding them summarized at the end of the memo:
1. Do we make any approach to Allende prior to his inauguration No-
vember 3 either a) to obtain commitments from him not to take certain anti-US
actions; or b) to be sure he understands what the consequences may be of such
actions?
a) Ambassador Korry has requested authority to make an immediate
private approach to Allende to negotiate a series of commitments from
him ranging from promises not to nationalize US property without
compensation, to not recognizing Vietnam or exporting revolution. No
one can quarrel with the desirability of having such commitments, but
Korry has not demonstrated that it is possible to obtain them nor has he
defined what it is he would offer in return.
The commitments relate to things Allende may not do anyway
during his consolidating period under his game plan; moreover to be
meaningful they require some precise negotiating which is a long
process if achievable at all (e.g. what constitutes adequate compensa-
tion, or exporting of revolution). If, to secure these commitments, we
offer to aid Allende, we insure his consolidation; if we offer non-
hostility we give up our main pressure against him; if we threaten him
we give him the opportunity to appeal to nationalism to excuse his ac-
tivities by charging we tried to intimidate him. If he chooses to violate
any commitments later when he is stronger we cannot prevent it, and if
he wants to neutralize us he could string us out in talks.
If Korry made the pitch and Allende said no, we would then lose
our flexibility and be forced immediately to a confrontation position or
appear to be a paper tiger. In short, I cannot see that we gain by this
gambit while tactically we risk a great deal.
I recommend that we take no initiative to negotiate a deal with Allende
prior to the inauguration.
b) State has suggested that, as distinct from a negotiation, an ap-
proach to Allende may be useful to make sure he understands our
likely reaction if he takes anti-US actions. While I think we need be
under no illusion that he fails to understand what we could do, he may
conceivably believe that we would ignore his actions. A warning that
we would not could be accomplished either privately, through Korry
or the Chilean Ambassador here, or through a general public statement
of our concerns.
A private approach has the merit of getting the message directly to
Allende, but it has the same defect as the negotiation gambitit gives
378-376/428-S/80023
September 5November 4, 1970 401
him the initiative to claim either that we threatened or that we negoti-
ated, and it may lead him to miscalculate ever more seriously.
A public statement of comment could accomplish the objective of
sending a message, and have the additional merit of making a public
record of our concerns for domestic and foreign consumption. It has the
defect of giving him the opportunity to charge public intimidation, al-
though this could be countered if the comment is skillfully phrased.
Public statement could be made by you or by a USG spokesman at
some suitable level. Your comment would clearly carry the most
weight, but I do not see that your personal involvement at this early
stage is necessary to achieve our objective; it may be better to preserve
your prestige for some later use when it may be more necessary. Suffi-
ciently official and desirably natural character could be given a state-
ment by Ziegler in response to a planted question on the occasion of the
October 24 election.
I recommend that we use the press spokesman gambit to observe that we
have noted Chiles electoral process is completed, that it is now up to
Chile and that we would of course be gravely concerned with any
policy measure which damaged US interests or sought to disrupt the
cohesion and harmony of the hemisphere, such as etc., etc.
2. Should you send the customary congratulatory message to Allende
upon his election October 24?
While customary, it is not required that you send a personal mes-
sage. Not to do so will be taken as coldness, but it is not the kind of ac-
tion Allende can very well react against or use specifically. To send a
message, even if perfunctory, would be perceived as your personal rec-
ognition of Allendes accession to power and as our accepting Al-
lende. That risk seems to outweigh the risk of being charged with ap-
pearing cold or hostile. Therefore, in balance I recommend that you send no
message.
3. Should we say anything to other Latin American countries now?
Just as Allende should be under no doubt as to our concerns, nei-
ther should our friends. To say nothing may lead them to think we are
unconcerned. Moreover, since we will need their cooperation in con-
taining any anti-US moves that Allende may make in the hemisphere
context, we should be coordinating our position to be ready. Therefore,
I recommend that prompt private consultations be undertaken with key coun-
tries to outline our views and concerns in some detail, including those
things for which we will be watching and against which we would
reacte.g. confiscation of property, Soviet military presence, export of
revolution.
4. What kind of delegation should we send to the November 3 inauguration?
We have been invited to send a special, high-powered delegation,
but this we would not want to do. Our practical choices are to send As-
378-376/428-S/80023
402 Foreign Relations, 19691976, Volume XXI
sistant Secretary Meyerwhich has been our customary pattern,or
to designate Ambassador Korry to represent us at the inauguration.
The custom in this case is more rigorous than in the case of con-
gratulatory messages. To designate Korry would be seen as a calcu-
lated rebuff, and Allende could credibly claim he was the aggrieved
party without justification. Meyers level is still less than they have
asked and is, therefore, suitably cool, but has the virtue of being our
pattern and custom. Hence Allende has no propaganda opening, but
can see the message.
I recommend that Meyer be designated to head a small, low-key delega-
tion, and that he be instructed to be cool and formal in his protocolary
contacts with the new government.
5. We suspended pipeline shipments of military equipment previously
contracted in an effort to provoke the military to action. Since they did not act,
should we resume such aid and if so when?
If we continue to suspend military aid it will appear we are pun-
ishing the military, which is the last group in Chile we ought to punish.
Moreover, if we maintain the suspension, we will have no screws to
tighten in this sector later if we wish to increase pressure on Allende.
The best posture would be to show to the Chilean military that it is Al-
lendes hostility which produced the cut-off. If we renew we should do
so before October 24; to wait until after the runoff election may be seen
as a step taken in recognition of that election.
I recommend we resume the pipeline shipments in small amounts imme-
diately, keeping in mind that they will be cut off as soon as Allende
takes hostile action.
6. [1 paragraph (14 lines) not declassified]
[1 paragraph (2 lines) not declassified]
Summary of Recommendations
2
1. That you disapprove any private contact or negotiating with Al-
lende prior to inauguration.
2. That you not send a personal congratulatory message to Allende
on his election.
3. That you approve an expression of concern by press spokesmen
in response to queries about the October 24 election, as the means of
conveying our message to Allende for the moment.
2
President Nixon initialed the Approve option under Recommendation 1. He also
initialed at the bottom of the page and drew a line up around to the top of the page for
Recommendations 2 through 6. An explanation of which options Nixon approved or dis-
approved is in Document 160.
378-376/428-S/80023
September 5November 4, 1970 403
4. That you authorize prompt private consultations and coordina-
tion with other key Latin American countries.
5. That you approve the resumption of deliveries on previously
contracted and purchased military equipment.
6. That you authorize the phase out of the US Air Force atmos-
phere testing unit currently stationed in Chile.
160. Memorandum From Presidents Assistant for National
Security Affairs (Kissinger) to Secretary of State Rogers and
Secretary of Defense Laird
1
Washington, October 21, 1970.
SUBJECT
Chile
The President has reviewed the Department of States memo-
randum of October 18 regarding interim decisions to be made on
US-Chilean relations,
2
and has made the following decisions:
1. He does not wish to send a personal congratulatory message to
Allende on his election.
2. He approves the preparation of a public statement for use by
State to comment on the October 24 elections. This statement should
note the completion of the Chilean electoral process and the importance
the US attaches to those principles upon which cooperation and peace
in the Hemisphere depend. It should also guide other USG spokesmen.
3. He does not approve the initiation by us of substantive discus-
sions with Allende prior to the inauguration. The Ambassador may
make a courtesy call on the President-elect if, but only if, protocol re-
quires, and provided a majority of chiefs of mission have done so. In
such a courtesy call, the Ambassador should not initiate substantive
discussions. If Allende raises substantive matters, the Ambassador
should limit himself to answering direct questions, within the frame-
work of the public statement mentioned in point 2 above. He should
note Allendes statements or affirmations and merely observe that
1
Source: National Archives, RG 59, Central Files 197073, POL 15 CHILE. Secret;
Nodis. A copy was sent to the Chairman of the Joint Chiefs of Staff and the Director of
Central Intelligence.
2
See footnote 1, Document 159.
378-376/428-S/80023
404 Foreign Relations, 19691976, Volume XXI
with reference to them we shall duly watch for the actions of his
government.
4. He has directed that prompt, private consultations be under-
taken with key Latin American countries to outline our views and con-
cerns in detail, including those things for which we will be watching
and which would constitute cause for concern, as well as to lay the
basis for future coordination of our policies toward Chile. He has asked
that instructions be sent to appropriate Embassies as soon as possible.
5. He has approved the designation of Assistant Secretary of State
Meyer to head a small low-key delegation to the inauguration.
6. He has authorized the immediate resumption of military equip-
ment deliveries and military training on a selected basis.
7. He approves in principle the gradual and deliberative reduction
and phase-down of the US presence. Specific plans for reduction of per-
sonnel and phase-down of activities are to be worked out by the De-
partment of State with appropriate agencies.
8. He has specifically reviewed Ambassador Korrys recommen-
dation on the phase-out of AFTAC and has approved it. He has di-
rected that State and DOD work out plans to begin this phase-out
immediately.
Henry A. Kissinger
161. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, October 22, 1970, 2145Z.
4468. Subj: Sitrep October 22nd.
1. Todays machine-gunning of Army CINC General Schneider
will surely strengthen Allendes position with armed forces, political
parties and public. Well-known Chilean revulsion to such violence will
also provide Allende with future justifications.
2
1
Source: National Archives, RG 59, Central Files 197073, POL 2 CHILE. Secret; Pri-
ority; Limdis. Repeated to Bogota, Buenos Aires, Brasilia, Caracas, Lima, Rio de Janeiro,
Rome, and USCINCSO for POLAD.
2
General Schneider died on October 25. For information on the role of the United
States in his death, see Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973, Document 39. Foreign Minister Valdes, in a conversation with Secretary of
State Rogers at the UN, noted that, without minimizing the seriousness of situation pre-
378-376/428-S/80023
September 5November 4, 1970 405
2. Taking into account well-orchestrated campaign of past few
days in Marxist media against CIA and right, noting that Communist
Puro Chile predicted that terrorist acts would occur Oct 22nd, observing
that all Marxist media ignored my preemptive public statement of last
night (Santiago 4452)
3
and recalling that Marxists have infiltrated
rightist lunatic fringe. I am not rpt not entirely persuaded that the
PCCh was unaware or completely innocent in Schneider affair. It has
too much of a pat smell to it and it evokes other examples starting with
Reichstag fire and including assassinations by rightist or lunatics
played upon by others. I recognize, of course, that Marxist campaign
against CIA and right could be both pro-forma and preemptive. But the
advantages to Allende and to the Marxists of the episode are so pat-
ently obvious that I have my doubts.
3. Prior to todays events, I was impressed by CAS reports to
Washington substantiated to me yesterday by diplomatic sources that
Allende may not proceed immediately with recognition of all or even
most Communist regimes. Chileans have been informing him of pos-
sible economic consequences of such actions and apparently have
forced some reconsideration.
4. It is the economic situation that is most preoccupying Allende as
he contemplates governing responsibilities. Marxists are clearly upset
by difficulties that will make almost impossible implementation of
some of most popular measures they promised in their electoral pro-
gram. Failure to fulfill such pledges at outset combined with increasing
awareness on part of unions and non-Marxist parties that there will be
no real worker participation in management or ownership will add to
Allendes problems in his first year in office. Worker councils are
anathema to orthodox Communists and if anyone has any doubts
about the parochialism of Chilean Communists and of Allendes
Marxist-Leninism they should ponder the decision to avoid genuine
worker participation (septel on this subject follows).
4
5. The Marxists are actively pursuing US companies. Dow reports
to me that last week it was convoked to a meeting with top Unidad
Popular economists-planners Nolff and Bertini who displayed very
sented by pending Presidency of Allende, Valdes saw Allende himself as best hope sal-
vaging it in face near term danger from socialists and long term from Communists. (Tel-
egram2704 fromUSUN, October 24; National Archives, RG 330, 76067, Box 68, Chile 092
1970)
3
Dated October 22. (Ibid., RG 84, Santiago, Classified Allende Files, 19681973, Box
6, United States-Chile Relations, SeptOctober 1970) Korrys statement, issued the night
of October 22, denied any involvement by the CIA or by anti-Communist Cuban exiles in
the attack on General Schneider.
4
Telegram 4495 from Santiago, October 23. (Ibid., Classified Subject Files of Am-
bassador Korry, 19671972, Box 2, EMKChron TelsOct 70)
378-376/428-S/80023
406 Foreign Relations, 19691976, Volume XXI
precise knowledge about Chilean petro-chemical setup and very ear-
nest desire to maintain Dows presence in some fashion. GM called on
Allende Monday and Ford today issued statement on Allendes auto
industry plans that indicated willingness to stay in Chile. These and
similar straws indicate that Allende will do utmost to maintain interna-
tional credibility, even to the point of trying to meet minimal interna-
tional conditions on copper nationalization. Anaconda poses special
problem, I believe, because Allende is convinced it played significant
political role in Chile and he will wish to be punitive in one way or
another.
6. While Schneider incident will ease anti-Allende pressures
within military, the tensions within his own coalition are increasing,
between the hard lining socialists including MIR and the gradualists of
the PCCh, and between gravy-seeking opportunists such as Tarud or
Radical Party hacks and the ideologues.
7. The public had become ever more acclimated to the advent of
Allende, being sweetly massaged every night on the three TV channels
and protected by a compliant or fearful press from any unpleasant
news. The bell-wether of the media, columnist and commentator Luis
Hernandez Parker, evoked a tranquilizing dream on his TV program
last night (govt channel) in which all those Chileans who had left the
country in an ill-considered panic would return now that they could
verify the democratic normality of the future. Schneiders wounds may
bloody that fantasy but it is true that the Nacionales, who have always
presented themselves to us as the true friends of the US, have not only
made their peace with Allende, but have ruled out any cooperation
with any PDCers in opposing the new President, thus prolonging both
respectability of Allende and the divisions that resulted in his victory.
The Nacionales also chose to try to save their own skins by seeking to
blame the Schneider episode on foreign agents, which in Chilean
parlance, thanks to the PDCMarxist vocabulary, means the US.
Korry
378-376/428-S/80023
September 5November 4, 1970 407
162. Briefing Notes Prepared in the Central Intelligence Agency
1
Washington, October 23, 1970.
TRACK II
I. Situation:
Yesterday morning at 0815 hours unidentified gunmen shot
and seriously wounded Chilean Army Commander General Rene
Schneider.
2
He was rushed to a military hospital for emergency sur-
gery. An Army high command communique said he was in serious
condition and the latest medical bulletin last evening stated his condi-
tion had worsened and that he would have to undergo further surgery.
The shooting came just 48 hours before Congress was to vote on con-
firming Salvador Allende as President. As a result of this assassination
attempt the following developments have taken place in the past 24
hours.
II. Developments:
A. General Carlos Prats assumed the position of Army CINC.
B. General Camilo Valenzuela assumed the position of Jefe de
Plaza for law and order in Santiago Province.
C. State of emergency declared throughout Chile.
D. Armed Forces and Carabineros confined to barracks.
E. Military given responsibility for investigating the assassination
attempt.
F. Rigid curfew imposed.
G. All exits from Santiago under close control.
H. Information media instructed not to publish or broadcast infor-
mation which could alarm or incite the public.
I. Retired General Emilio Cheyre designated Chief of Investiga-
tions and Socialist Rene Paredes (pro-Allende) named Sub-Director.
J. The UP issued a statement blaming the attack on rightists sup-
ported by foreign elements.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile
Papers, Church Committee, August 12, 1975. Secret; Sensitive; Eyes Only. There is no in-
dication as to the intended audience for this information. However, since it uses the term
Track II rather than the cryptonym of the Track II operation, it was most likely pre-
pared for briefing Kissinger or Haig rather than for an internal briefing.
2
According to an intelligence report, the weapons used were not provided by the
United States. (Telegram 615 from the Station in Santiago to Headquarters, October 29;
Central Intelligence Agency, DO/LA Files, Job 80000012A, Box 6, Military, Vol. IV, 27
October 70)
378-376/428-S/80023
408 Foreign Relations, 19691976, Volume XXI
K. Chilean Confederation of Workers called an emergency
meeting to discuss the assault on Schneider.
L. Technical Students planned a demonstration for yesterday
afternoon.
M. Government investigating recent arrival of foreigners in Chile.
N. General Viaux, retired Lt. Col. Jose Cabrera and six unidentified
persons, including members of Patria y Libertad, reportedly have been
arrested.
O. The three Armed Forces Commanders in Chief, General Prats,
Admiral Tirado, and General Guerraty, issued a communique con-
demning the attack on Schneider and announcing their support for the
constitution.
P. Allende met with President Frei yesterday afternoon and asked
Frei to adopt drastic measures to crush a seditious plan.
Q. General Valenzuela addressed the nation over radio last eve-
ning concerning measures to be taken under the state of emergency.
R. President Frei spoke over nationwide radio expressing his pro-
found indignation over the attempted assassination and explained the
steps taken under the state of emergency.
III. Analysis:
With only 24 hours remaining before the Congressional run-off, a
coup climate exists in Chile. The assassination attempt against General
Rene Schneider has set off a train of events that has started Chileans
talking about a coup and has raised the expectation that something sig-
nificant will occur today.
The attack on General Schneider has produced developments
which closely follow Valenzuelas plan: Schneider has been removed, a
state of emergency has been declared, General Prats has replaced Gen-
eral Schneider, radicals have been arrested, and General Valenzuela
has assumed control of Santiago Province. [2 lines not declassified] Al-
though the plotters may have second thoughts about a coup, they
nonetheless are irrevocably committed to executing the ploteven if
Frei refuses to resignsince it can be assumed that their plotting would
eventually surface under an Allende government. Hence they have no
alternative but to move ahead.
The state of emergency and the establishment of martial law has
significantly improved the plotters position: a coup climate now pre-
vails in Chile, and military officers have replaced civilians at the pro-
vincial level. This condition greatly inhibits any future effort by Al-
lende to counteract the coup. The next step in Valenzuelas plan, which
is the most important one, calls for the resignation of Frei and his cab-
inet. Thus far, President Frei shows no indication that he intends to re-
378-376/428-S/80023
September 5November 4, 1970 409
sign. If Valenzuela has advised Frei of his plan and Frei has concurred,
then Frei certainly would be compelled to resign. Should Frei not be ad-
visedas appears to be the casea confrontation between the plotters
and Frei can be expected before the Congress meets tomorrow.
163. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, October 23, 1970, 1720Z
4483. Subj: Ambassadors Warning to Frei and Allende. Ref: San-
tiago 4481.
2
1. In absence of Acting Foreign Minister Silva, I called MinState
Troncoso in Presidential Palace (one of Freis closest intimates and one
of my most helpful contacts) to say that I wanted his advice on what to
do now that Allende press was venting most provocative anti-US
charges (reftel). I noted that Frei last night in nationwide TV had re-
quested media to avoid inflammatory declarations. The entire Allende
media had disregarded this plea and was creating a climate that made
me dubious about the personal security of the community for which I
was responsible. Additionally, I could hardly avoid the conclusion that
the Allende govt wished to demonstrate its hostility to the US in the ug-
liest manner possible and that I could hardly avoid recommending
to Washington actions commensurate with such an attitude, starting
immediately.
2. Troncoso replied that it was important to distinguish word from
action and that the US should proceed with the greatest caution in how
it chose to deal with Allende so as to avoid being a scapegoat. He added
that the UP had many components difficult for Allende to control. I
agreed but noted that orchestrated propaganda was producing a cli-
mate of insecurity for Americans. That to my mind was action. And I
wished to know what if anything either Frei or Allende would do about
it. I observed we too had Congressmen who had so far kept an admi-
rable silence. I noted that Allende was having a press conference with
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Confi-
dential; Immediate; Exdis.
2
Telegram 4481 from Santiago, October 23, reported that the press was blaming the
attack on Schneider on foreign elements, including specific charges that the Central Intel-
ligence Agency was involved. (Ibid., POL 2 CHILE)
378-376/428-S/80023
410 Foreign Relations, 19691976, Volume XXI
foreign newsmen in mid-afternoon today and that if he were not clearly
informed of the gravity with which the GOC (Frei) viewed the media
situation, then the GOC would have to assume the responsibility for
my recommendations to Washington. Troncoso replied that he under-
stood and that he thought he could do something via Frei.
Korry
164. Memorandum From Viron P. Vaky of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, October 27, 1970.
SUBJECT
Korrys Recommendation on ChileSend Congratulatory Message
Attached is Korrys nodis telegram (Santiago 4512)
2
recommend-
ing that:
1. The President send a message of good wishes to Allende on his
inauguration.
2. State press spokesman state at an early opportunity that the US
looks forward to normal relations and continuation of the traditional
ties with Chile.
Korrys recommendation is based on the argument that we should
not trigger reactions that are unnecessary or provoke outside forces;
that the economic situation will have considerable influence on events
in the immediate future and that we can keep our options open there;
but that in order to have such options our public posture must be
above hostility.
Korry cites an excerpt from your New England background to bol-
ster his reasoning (see paragraph six of the attached cable).
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Nodis. Sent for information. Kissinger
wrote, PetePlease be sure to do outstanding book for NSC Meeting. Cold and Correct.
HK at the top of the page.
2
Attached but not printed is telegram4512 from Santiago, October 26. The telegram
is Document 29 in Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973. Allende was elected President by a joint session of the Chilean Congress on
October 24.
378-376/428-S/80023
September 5November 4, 1970 411
Korry poses the following summary assessments:
A. Immediate Future
The Latin American reaction is that Chile continues to be demo-
cratic and friendly and should be so considered until events prove to
the contrary; they are sending Cabinet-level inauguration delegations.
Western Europeans will send minimal delegations; most will
not send congratulatory messages until the inauguration; some ambas-
sadors will call on Allende; several countries will announce loans
(British, French and German).
Soviets apparently keeping to low-key posture.
Allende is carefully avoiding belligerent statements.
B. Longer Term
Western Europeans are unanimous that Communists will move
slowly and cautiously but that Allende should not be written off. West
should avoid overt hostility.
Soviets also playing down possibility of meaningful trade and
aid; they are urging Allende to maintain best possible relations with the
West.
US companies are beginning pre-negotiation talks with Al-
lendes representatives. They have no illusions about long-term pros-
pects but are out to get the best deal they can for the present.
Allende likely to move very slowly with regard to recognition of
socialist states unless he becomes convinced that West is implacably
hostile.
Korry says he remains convinced that Allende has not changed
skins, that he is as unreconstructed a socialist as before with a con-
vinced anti-US and anti-capitalist bias; that his long term goal is a
state-controlled economy like Eastern Europe. However, the realities of
the Chilean economy and the hard facts of Chilean dependence on
Western capital markets and technology are seen differently from the
Presidents chair than the candidates platform. Korry believes that in-
ternal tensions within the governing coalition and economic problems
are going to present Allende with some very difficult obstacles. This,
then, leads him into the conclusions summarized above in the first
paragraph.
Comment: I do not know if this recommendation from Korry was
elicited or not. It is the current State position. It strikes me that what is
happening is that people are being convinced by Allendes game plan.
As you recall my previous memos spelled out a game plan whereby Al-
lende would seek to convince everyone he is legitimate and acceptable
and reassure everybody who is apprehensive. This is precisely what he
is doing. The question is do we get convinced by this game plan, or
play along with it, or remain cold and correct.
378-376/428-S/80023
412 Foreign Relations, 19691976, Volume XXI
165. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, October 27, 1970, 1730Z.
4538. Subj: Talk with Allende Emissary.
1. I agreed to see late Oct 26 after Schneider funeral radical Senator
Hugo Miranda who had called on me Sept 10th as Allendes designated
emissary (Santiago 3612)
2
and who had been phoning for the past week
to learn about the US Delegation to the inauguration. DCM who had
contacted Miranda re my recent Washington consultation participated
in talk in my office.
2. I told Miranda that Delegations composition had not been de-
cided yet. When he remarked that incoming govt wished to have dele-
gation as high as possible, I noted that in four previous Latin inaugura-
tions under Nixon administration that in cases of two (Guatemala and
Santo Domingo) there had been no special representation invited from
Washington because of host govts internal security and that in case of
Ecuador and Colombia, Asst Secy Meyer had been head of delegation.
Miranda said Allende hoped for higher representation but I gave him
no basis for believing that such would be the case or Meyer the man. He
then mused that Meyer was really a Vice-Minister.
3. Miranda then raised Allendes preoccupations over USAF
pullout from Easter Island and linked AFTAC incorrectly with asser-
tion that NASA also would be evacuating its station outside Santiago.
(This subject was the main motivation for my response at this time to
Miranda and I wanted to set record straight but in answer to his initia-
tive.) I said that USAF for economy reasons had decided sometime ago
to leave Easter Island. Hence it had appeared preferable to me to begin
the phaseout under the Frei govt so there would be no misunder-
standings later with the new govt. Moreover the absence of such mili-
tary presences, reflecting what I had understood to be the desires of Al-
lende, would eliminate the whole subject of military bases and there
would be no reason therefore in the future to have any problems about
or basis for any foreign military installations. DCM explained NASA
separate civilian rels with Univ of Chile and its unaffected status.
4. Miranda referred to Secretary of Defense Lairds recent TV inter-
view in which he had expressed concerns about Chile in the same
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Secret;
Priority; Exdis. This telegram was brought to Kissingers attention by a memorandum
from Vaky, October 28. (Ibid., Nixon Presidential Materials, NSC Files, Box 774, Country
Files, Latin America, Chile, Vol. II)
2
Telegram 3612 from Santiago, September 11. (Ibid., RG 59, Central Files 197073,
POL 15 CHILE)
378-376/428-S/80023
September 5November 4, 1970 413
breath as Cuba. Miranda linked this to what he described as an inter-
view given by Dr. Kissinger in Chicago in which the same preoccupa-
tions were voiced. I replied that Kissinger had given no interviews and
that Secretary Lairds reference was a vague and conditional one. How-
ever I could say in all frankness that it was logical that Americans had
certain doubts about the future on the basis of past history. The Amer-
ican public had been told that Mao Tse-tung was an agrarian reformer
somewhat of the order of Rafael Moreno (Freis land reform chief) and
had been informed by the NY Times that Castro was also a benign re-
former. I had no doubts about Allendes honesty and sincerity but the
US public had been conditioned by experience to judge by action not by
word. The US had recently displayed its most serious concern about the
possibility of a Soviet sub base in Cuba; happily the Soviets understood
the seriousness of our concern and had responded promptly and con-
structively. Secretary Laird had this concern in mind when he had ap-
peared on TV several weeks ago and we also had been no less con-
cerned by the Soviet exploitation of a Mideast cease-fire to advance
their missiles. The US was on record about this hemisphere and there
should be no misunderstandings about the gravity of our concerns if
there were to be any other attempts anywhere by the Soviets to position
themselves militarily in this half of the globe. I added that Miranda and
Allende should read the Presidents speech to the United Nations
3
which I promised to send together with a clipping of the Oct 23rd NY
Times front page picture showing Miranda and Allende. The US felt
strongly that the traditional super-power desire to seek every minute
advantage at the expense of the other was not only puerile but contrary
to the interests of all humanity including the great powers. We hoped
the Soviets would also come to understand the greater strategic advan-
tages of peace when measured against ephemeral and dangerous tac-
tical gains.
5. I went on to say that my views on the need for the US presence in
Chile to be reduced were well-known to the Frei govt. Whoever was
President of Chile, I would continue to press for such reduction. The US
was anxious not to take an overly prominent role in Chiles internal af-
fairs. Increasingly we counted on multilateral institutions. We would
continue to confine ourselves to bilateral matters of concern to the two
govts. I had no desire, and never had, to be known unofficially as an
extra-official member of any foreign govt. I hoped that he and the new
govt would understand these views.
6. Miranda said he welcomed the frank exposition and the clear
language. However he returned to the Kissinger-Laird statements and
3
President Nixon concluded his October 23 address to the UN General Assembly
by calling for the mutual respect that fosters peace. The address is printed in full in For-
eign Relations, 19691976, vol. I, Foundations of Foreign Policy, 19691972, Document 78.
378-376/428-S/80023
414 Foreign Relations, 19691976, Volume XXI
threw in the US press as well to say that US doubts were not justified,
that Allende wished good relations etc. He referred to concerns that
Chile might serve as a model or stimulant for similarly political ar-
rangements in LatAm, denying that this could be the case since each
country has its own conditions. Miranda then remarked that we are
not exporters of revolution, we export copper; and we want to sell our
copper for dollars and to maintain and expand our traditional
markets. I made no comment on that point.
7. I told Miranda that I accepted his statements without reservation
but that I had had to report to my govt and had had to raise with the
Frei govt the orchestrated campaign of all Popular Unity media and of
its leading spokesmen against the US. I repeated the statements I had
made to MinState Troncoso and later to Acting Foreign Min Silva last
week (Santiago 4483)
4
and said that if this campaign continued I could
only conclude that the U.P. wanted to launch the Allende govt in a cli-
mate of hostility to the US and that I would recommend to my govt that
all Americans except those necessary to maintain formal diplomatic re-
lations be promptly withdrawn. Miranda replied that I should under-
stand that an Allende govt had not yet been formed, that there had
been the Schneider episode and that once Allende took office these
matters would be better handled. I observed that I could not ask for a
controlled press when we had so much admiration for the democratic
institutions of Chile but that my reporting to Washington would be
based on the actions of the Allende govt and such assessment would in-
clude orchestrated press campaigns.
8. Conversation was friendly throughout and in final moments I
noted to Miranda that we were having important elections next week in
the US where policy towards Chile had not yet been considered. I had
gone to Washington to report on events here and to do nothing more
than settle some housekeeping details such as AFTAC.
9. Miranda lamented on several occasions what he described as in-
adequate channels of communication between Popular Unity and USG
during this period, but observed that situation would be corrected
when new government constituted. I agreed and said that I would look
forward after Dr. Allende had taken office to discussing with him and
his government bilateral problems as they may arise. Point was thus
made that I do not plan call on Allende before Nov 4.
Korry
4
Document 163.
378-376/428-S/80023
September 5November 4, 1970 415
166. Annex to an Options Paper
1
Washington, October 27, 1970.
COVERT ANNEX
(to Options Paper for NSC on Chile)
I. Covert Objectives
To prevent the Allende government from establishing an authori-
tarian Marxist regime, and to prevent the movement of Chile into the
Communist sphere, by undertaking covert courses of action which will
allow the U.S. to aid and abet forces disillusioned with Allende to re-
capture power politically, or, under certain circumstances, overthrow
his government. At the same time to prevent Chile from influencing the
rest of Latin America to follow it as a model.
II. Covert Courses of Action
A. The Allende Government:
1. Undertake political action to divide and weaken the Allende co-
alition, especially within the U.P., which as a grouping of divergent po-
litical forces has built-in tension areas which can be exploited. Provide
financial support to one or more pivotal figures with a view to insuring
the development of divisive factions within the Allende coalition. Par-
ticularly through the judicious exploitation of intelligence, create fric-
tion between the Communists and the Socialists. Emphasis will also be
placed on deception operations which will cause certain coalition
members (such as the dissident Democratic Christians and the Rad-
icals) to question the true intentions of the Communists and the
Socialists.
2. Play upon the known tendency of Allende and certain of his
advisors to react to certain forms of direct criticism. [3 lines not
declassified]
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
1970. Secret; Sensitive. Sent for information. This Annex, attached to Options Paper for
NSC on Chile, was sent to Kissinger on October 28 by Chapin. In his covering memo-
randum, Chapin noted that CIA had just distributed it to the 40 Committee principals for
their consideration at a meeting after the SRG meeting, to be held at 10:15 a.m. on October
29. The covering memorandum also contains the following handwritten note: Not for-
warded. Vaky stated to FMC [Chapin] that the Annex was not expected to come up at the
SRG mtg. The Annex will probably be considered by the 40 Comm at a later date. (Ibid.)
An analytical summary of the Options Paper is Document 167.
378-376/428-S/80023
416 Foreign Relations, 19691976, Volume XXI
3. Undertake selected economic operations when clandestine
sponsorship is appropriate. A prime aspect of such a program would
be to stimulate the exodus of key technicians and professionals from
Chile.
4. Support sitting ducks in the media field (possibly a news-
paper and a radio outlet) which would snipe at the government at a
sufficient level to provoke repressive action thus opening a wedge for
freedom of the press exploitation.
B. The Chilean security forces:
1. Sponsor a program which will enable the military institution to
retain its integrity and independent political power. Provide direct fi-
nancial support to key military figures who can be expected to develop
a meaningful following in their respective services.
2. Play up the efforts of the Cuban and Soviet intelligence services,
to assume control of the Chilean investigative and security organiza-
tions for both internal and external subversion. This theme, if properly
documented, should have an impact on the military.
C. Non-Marxist political forces:
1. Provide financial support to selected anti-Allende political
groups and their media. Support existing and emerging leaders, using
them in a program to unite divergent sectors into a popular opposition
movement capable of demonstrating political strength during future
municipal and federal elections.
2. Maintain updated contingency plans for clandestine support of
an exile leader or group should internal developments provoke flight
of any important leader or a significant sector of the population.
D. Chilean public:
Use clandestine assets and techniques to promote a climate of un-
certainty in Chile, especially as diplomatic and commercial relations
with the Communist world solidify. Emphasize the sterile and somber
future for the private citizen in a Socialist state. Focus special attention
on the political center which now seems to have accepted Allende but
which will remain the key to any broad based future political action.
E. OAS and other Latin American countries:
1. Develop an international propaganda campaign to publicize en-
croachments on the democratic system. Replay this information into
Chile [1 line not declassified] to inhibit radicalization and nationalization
of American interests.
2. Use the regional press to zero in on selected targets which might
cause Allende to slow down efforts at radicalization or conversely pro-
voke him into excessive acts.
378-376/428-S/80023
September 5November 4, 1970 417
3. Provide early warning to neighboring countries of any indica-
tion that third country activists plan to use Chile as a haven or as a
staging ground for subversives.
167. Analytical Summary of an Options Paper
1
Washington, October 28, 1970.
Analytical Summary
Options Paper for NSC Discussion
NSSM 97Chile
The State/DOD paper posits assumptions about an Allende gov-
ernment and its future course, states U.S. objectives in the light thereof,
and then describes options for achieving them.
I. Assumptions
These do not vary greatly from previous papers. The judgment is
that Allende will seek a socialist state; will have an anti-U.S. bias and
will work against us to eliminate our influence; will establish linkages
with the USSR, Cuba and other socialist states.
The paper assumes that he will have domestic opposition, internal
tensions within his coalition, and economic difficulties. It further as-
sumes Allende will work diligently and purposefully to overcome all
of these obstacles.
It assumes that Allende will be pragmatic in his tactics and will
move carefully. He may not radicalize very fast. He will, at the outset at
least, wish to maintain his international credibility as a responsible
debtor and borrower, and as a responsible sovereign power.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H48, Senior Review Group, Chile (NSSM 97), 10/29/70. Se-
cret; Sensitive. Vaky drafted this analytical summary of the StateDefense Options Paper.
In an October 28 covering memorandum to Kissinger, Vaky noted, You do not need to
make any substantive decisions at this meeting, and I would recommend that we not
spend too much time trying to perfect the paper. It has too many problems. The main
purpose of the meeting is to see whether there are any major disagreements in the as-
sumptions and objectives and that the major proponents of the two options presented
feel they have had a fair hearing. It would also be useful to point out some of the hard
questions that can be asked and have not been. (Ibid.) The full text of the Options Paper
is published in Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973,
Document 30.
378-376/428-S/80023
418 Foreign Relations, 19691976, Volume XXI
It assumes that U.S. domestic sectors will watch the Chilean situa-
tion carefully; so far our handling of the situation has been supported.
If Chile becomes overtly hostile, there will be no adverse reaction in
some areas of the public, the press and Congress.
The judgment is that other Latin American and European nations
will not be overtly hostile; they will accept the Allende government in
regional and multilateral organizations; and will generally adopt a
wait-and-see attitude, although there will be private mistrust and
suspicion.
II. U.S. Objectives
The following objectives are listed by the paper:
1. The prevention of establishment by the Allende government of
an authoritarian Marxist regime, prevention of the regimes falling
under Communist control, and prevention of its influencing the rest of
Latin America to follow it either as a model or through its external
policies;
2. To act as a counterpoise to Soviet influence;
3. To protect U.S. economic interests; and
4. To protect U.S. security interests.
2
The foregoing is the exact excerpt. There is no elaboration of what
2, 3 and 4 mean precisely.
III. Options
The paper poses as general propositions that:
we should have a restrained, deliberate attitude toward Chile,
in order to keep our influence in Chile and maintain flexibility and
initiative to exploit opportunities;
3
events in Chile will be determined principally by internal
Chilean forces; therefore, we can have only marginal effect;
the skillful exercise of our influence, nevertheless, can be impor-
tant in complicating Allendes task;
the negative use of our influenceby which the paper appar-
ently means unprovoked hostilitywould enable Allende to rally
support;
on the other hand, a passive attitude would discourage and con-
fuse Allendes opponents, leave the initiatives in his hands, and risk ad-
verse U.S. domestic reaction.
The paper then lists two options:
Option A: (State) Outwardly correct, no hostile initiative which Al-
lende could turn to his advantage; act quietly to limit the Allende gov-
ernments freedom of action.
2
Next to points 2 through 4, Kissinger wrote, how?
3
Next to this point, Kissinger wrote, Means what?
378-376/428-S/80023
September 5November 4, 1970 419
This option is premised on the hypothesis that (a) domestic ob-
stacles and difficulties will be great, and (b) that overtly hostile acts ini-
tiated by us will work to Allendes advantage. The paper argues that by
depriving Allende to the extent of the benefit of blaming us for his
problems we will limit his prospects of consolidating power.
This option is illustrated by an extensive list of courses of action.
These would:
involve hostile covert activities (see below);
reducing presence but maintaining activities such as Peace
Corps and NASA, if Allende requests it;
4
apparently no bilateral economic aid, except food for peace and
the Ambassadors discretionary development fund, but handle Chilean
requests through international institutions on their merits;
5
apply the same criteria to debt renegotiation we would apply to
others;
discourage private investment;
react firmly to expropriation and seek compensation;
maintain military assistance;
publicize weaknesses of communist system; and
quietly maintain consultations with other countries, but avoid
actions to unite them with Allende.
Option B (DOD) Act deliberately and not over-react; maintain flexi-
bility; but let everyone know we are opposed to communism and to
Allende.
This option is also illustrated by a list of courses of action. These
are not very different from Option A. It would utilize covert action,
apply specified legal sanctions and pressure if Allende takes acts such
as trade with Communist countries or expropriates U.S. property with-
out compensation; and continue military aid.
It proposes some other actions, whose relevance is hard to see,
such as maintain surveillance on Chilean ships going through the
Panama Canal, sell F4s to Argentina, seek NATOs support for our
Western Hemisphere security interests.
One major difference is that we would publicly state our hostility
in a general statement, and assume publicly from the outset that the Al-
lende government is a Communist government.
The above two options are essentially the same ones that we con-
sidered at the last SRG meeting.
4
Below this point, Kissinger wrote, Why NASA?
5
Above this point, Kissinger wrote, Getting along option. Kissinger drew a line
to Ambassadors discretionary development fund and wrote, size?
378-376/428-S/80023
420 Foreign Relations, 19691976, Volume XXI
In addition, there is a CIA annex,
6
outlining a covert action pro-
gram to hamstring Allende and play for the breaks. These are essen-
tially tactics aimed at splitting Allendes coalition, strengthening do-
mestic opposition, keeping influence with the military. This game
plan could be used with either Option A or B.
Option A is clearly concerned primarily with avoiding overt hos-
tility and triggering stronger anti-U.S. reactions. It is designed to pro-
vide a framework within which Allende can make his own mistakes
and not find an excuse to escape their consequences. It is premised on
the belief that if left to operate, domestic obstacles will probably be too
great for Allende to overcome. A good question is whether this premise
is correct; it was judged in the assumption section of both this paper
and NSSM 97
7
that Allende had the capacity to overcome his problems
if left to his own game plan.
While Option A poses pressure on Allende to exacerbate his
problems, this is largely on the covert side. The question can be asked
whether the overt action programswhich largely accept and accom-
modate to his actionsdo not contradict the purpose of the covert ac-
tions. Essentially, Option A seems to be an accommodation posture
which would play things by ear. It also assumes that Allende should
prove his unacceptability rather than prove his acceptability, and give
him the benefit of the doubt.
Finally, it is not clear that we could avoid confrontation anyway.
Any move by Allende toward recognition of North Viet Nam or confis-
cation requires us to react in some way. We may therefore be required
to confront, the only question being whether he sets the pace or we do.
Option B seems likely to be even more ineffective. Its courses of ac-
tion are not really much tougherthey only sound that way. Almost
everything suggested is a reaction to something Allende does. It does
not pretend to be tough when it touches on DOD interestsmilitary
assistance[1 line not declassified]. The trouble with Option B is that it
would have us talk tough. Hence we risk the worst of both worlds
none of the advantages of a cool, correct posture and all of the disad-
vantages of a hostility based on words.
8
IV. Issues For Decision
It seems to me that the questions that should be asked are the
following:
A. Do we have to be hostile?
6
Document 166.
7
See Document 147.
8
Below this paragraph, Kissinger wrote, Have we other choices?
378-376/428-S/80023
September 5November 4, 1970 421
No one pretends that Allende is going to change his goals volun-
tarily or that he would negotiate their modification to get something
from us. A U.S. policy of trying to reach a modus vivendi with him will
not deter Allende from his anti-U.S. policies if he wants to pursue them.
We are therefore led to conclude that only some kind of adversary strategy
promises to contain or deter the adverse impact of Allende policies.
B. What kind of an adversary strategy do we have to have and what degree
of hostility?
It is generally agreed that we do not have the leverage or capacity
to engineer his overthrowat least under present circumstances. The
question therefore is whether we can take actioncreate pressures, ex-
ploit weaknesses, magnify obstacleswhich at a minimum will lead to
his failure or force him to modify his policies, and at a maximum might
lead to circumstances where his collapse or overthrow may be more
feasible. This appears to be the most indicated tactical objective to serve
the larger conceptual objective described in II above.
C. How overt should our hostility be? Should we take the initiative or
should we react to his actions?
This is the real issue between the two options. The disadvantages
of overt hostility are persuasive. A hostility made visible and initiated
by us would clearly benefit Allende and blunt the effect of other pres-
sure. It is therefore fair to conclude that we are in a much better posture if we
maintain a correct public posture and avoid public hostility.
D. What constitutes overt hostility?
This is the issue as regards the various action programs. States
propensity is to regard any measure which is cold as hostile,
9
and these
are not necessarily the same. For example, State argues that not to send
a Presidential congratulation is overtly hostile. The trouble with this
position is that this plays to Allendes game plan and legitimizes him.
This is surely a useful distinction between coldness and actively hostile
measures, such as freezing Chilean assets. Moreover, we should note
that we are not going to kid Allende if we act nicely on the surface and
try to overthrow him covertly.
My own personal conclusion is to come down once again in be-
tween A and B for a policy that maintains an overtly correct policy,
avoids initiating actively hostile acts, and maximizes pressures. The
purpose is not to try and fool him into thinking we like himhe knows
better; it is to give him no excuse to retaliate and no political benefit
from a publicly hostile U.S. posture.
9
Kissinger underlined which is cold as hostile.
378-376/428-S/80023
422 Foreign Relations, 19691976, Volume XXI
168. Briefing Notes Prepared in the Central Intelligence Agency
1
Washington, October 28, 1970.
RECENT DEVELOPMENTSTRACK II
1. Following the attack against General Schneider, there have been
few developments on Track II. It now appears that the military prin-
cipals with whom we were in contact depended on the abduction of
Schneider, probably by General Viaux, as the pretext needed to launch
a coup. This was a serious plan, but the unexpected resistance of
Schneider and his subsequent death inhibited further action. Presum-
ably the military figures were not willing to be a part of violence be-
yond the kidnapping scheme.
2. When martial law was declared and General Valenzuela was
given the military command of the Santiago Garrison, the necessary
control for a coup existed. At this point, for obvious security reasons,
we were not in contact with the principals. After forty-eight hours it
was clear that the military had decided not to move.
3. On 24 October a representative of General Viaux made an emer-
gency meeting with an Agency representative [less than 1 line not declas-
sified]. He carried a request from General Viaux that we have the Am-
bassador in Santiago contact President Frei and others to assure them
the attempt against Schneider was a Communist ploy. He also asked
for immediate world-wide publicity to the same effect. This was not, of
course, possible.
4. Numerous arrests have been made in Santiago. To date none of
the persons detained are numbered among those with whom we have
been in contact. [1 lines not declassified]
5. The Communist and leftist press has made a number of accusa-
tions against the Agency and the Argentines. Generally, however, the
Schneider attack is still considered as a kidnapping attempt which
went wrong, carried out by the Chilean oligarchy.
6. General Viaux made a public statement, disclaiming responsi-
bility, on 27 October and pledged to turn himself in to the authorities;
on 28 October General Viaux (R) was detained by the police for ques-
tioning and is now in police custody.
1
Source: National Archives, RG 59, ChileITTCIA 19631977, Lot 81D121, Chile
Papers, Church Committee, August 12, 1975. Secret; Sensitive; Eyes Only. There is no in-
dication as to the intended audience for this information. However, since it uses the term
Track II rather than the cryptonym of the Track II operation, it was most likely prepared
for briefing outside the CIA.
378-376/428-S/80023
September 5November 4, 1970 423
169. Minutes of a Meeting of the Senior Review Group
1
Washington, October 29, 1970, 10:3411:22 a.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger
State CIA
Ambassador U. Alexis Johnson Mr. Richard Helms
Under Secretary John Irwin Mr. Thomas H. Karamessines
Mr. Charles A. Meyer Mr. William Broe
Mr. Robert Hurwitch
NSC Staff
Defense Mr. Viron P. Vaky
Mr. David Packard Col. Richard T. Kennedy
Mr. Armistead I. Selden, Jr. Mr. Ashley Hewitt
Mr. Raymond G. Leddy Mr. D. Keith Guthrie
JCS
Lt. Gen. Richard T. Knowles
Colonel Francis Riggs
SUMMARY OF CONCLUSIONS
1. The Defense Department option will be reformulated in two ver-
sions: (1) a position of overt hostility at the outset and at the initiative of
the United States, and (2) a position of hostility, but with overt anti-
Allende actions keyed to provocations from Allende. The list of actions
contained in the Defense Department option will be reviewed for ap-
propriateness and comprehensiveness.
2. The State Department option will be reformulated in two ver-
sions: (1) a position which assumes that the initial and long-term US re-
lationship with Allende will be hostile but seeks to maintain maximum
flexibility for the United States to deal with developments as they arise,
and (2) a position which seeks to keep open the option of establishing
friendly relations with Allende in the event, now considered unlikely,
that he moderates his Marxist and authoritarian objectives and pursues
a course of action more compatible with US interests.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H48, Senior Review Group Minutes, Originals, 1970. Secret;
Sensitive; Nodis. A copy was sent to Vaky and Kennedy. The minutes were sent to Kiss-
inger through Haig under cover of a memorandum from Davis. (Ibid.) The meeting took
place in the White House Situation Room. All brackets are in the original.
378-376/428-S/80023
424 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger: I have read the options paper and suggest we
discuss that first. We can discuss the CIA annex in a restricted session
later; as I understand, it really applies to both options.
2
As I understand, the assumptions we are making in the present op-
tions paper are the same as in previous papers. Allende will seek a so-
cialist state, will have an anti-US bias and will work against us to elimi-
nate our influences, and will establish linkages with the USSR, Cuba,
and other socialist states. He will have domestic opposition, internal
tensions within his coalition, and economic difficulties. He will move
carefully and may not radicalize very fast, and he will try to maintain
his international credibility for a while. Other Latin American and Eu-
ropean nations will not be overtly hostile.
Are these assumptions agreed to by everybody as a basis for our
analysis?
Mr. Meyer: Yes.
Dr. Kissinger: The paper then states the US objectivesprevent es-
tablishment by the Allende government of an authoritarian Marxist re-
gime, act as a counterpoise to Soviet influence, protect US economic in-
terests, and protect US security interests. I dont have any trouble with
the first of these, but howare we going to act as a counterpoise to Soviet
interest given the assumptions we have just reviewed?
Mr. Packard: By keeping him from going socialist.
Dr. Kissinger: That is, by achieving the first objective. If that is the
case, are not the second, third, and fourth objectives dependent on at-
taining the first?
Mr. Meyer: Yes, I think so.
Dr. Kissinger: If you achieve the first objective, you also achieve
the rest. If you dont achieve the first, you might still achieve the third,
and perhaps the fourth (if you could induce Allende not to give bases to
the Soviets). Of course, Chiles potential as a base for subversion in sur-
rounding countries might be more worrisome to us than would be the
establishment of facilities for the Soviets there.
Mr. Meyer: There is no indication that in the medium term Allende
plans to export subversion.
Mr. Johnson: He will certainly give refuge to subversives from
other countries.
Dr. Kissinger: It would not be in his interest to let us know that he
is planning to export revolution.
Mr. Selden: He is certainly not going to tell us.
2
Documents 167 and 166, respectively.
378-376/428-S/80023
September 5November 4, 1970 425
Dr. Kissinger: Lets go to the options. The State option calls for us
to be outwardly correct, to take no hostile initiative which Allende
could turn to his advantage, and to act quietly to limit the Allende Gov-
ernments freedom of action. The Defense option is to act deliberately
and not over-react and to adopt a more direct posture of hostility.
Is the difference between the two options a question of how overt
our hostility is? The actions we would take are essentially the same in
both cases. What do we do under Option B [the Defense option]be-
sides talking differentlythat we would not do under Option A [the
State option]?
Mr. Packard: We have listed a number of things. One would be to
start moving on implementing the restrictive provisions of the Foreign
Assistance Act.
Dr. Kissinger: You mean that we would assume on November 4
that the Chilean Government is a Communist government as defined in
the Foreign Assistance Act.
Mr. Packard: Yes. There is no doubt we are going to end up with a
socialist government. We should act accordingly.
Dr. Kissinger: You would implement these provisions on No-
vember 5 without waiting for Allende to act. The idea would be that his
mere assumption of power justifies action under the Foreign Assistance
Act.
Mr. Selden: The real difference between the State and Defense ap-
proaches is that State wants to wait and see and let Allende take the ini-
tiative. Defense wants to put Allende on notice; this means that we take
the initiative.
Dr. Kissinger: States position seems to be that Allende has to
prove his unacceptability.
Mr. Johnson: What State is proposing is to react to what Allende
does. He would take the initiative.
Dr. Kissinger: All agree that the overwhelming probability is that
we will eventually have to move to a position of hostility. However,
tactically it may be better to be provoked than to be in a position of
being the aggressor. There is another assumption that seems to be in-
volved in States proposal. That is, that there is just enough possibility
of getting along with him that we ought to keep open this option.
Mr. Meyer: To put it another way, we ought to evaluate Allende
progressively.
Dr. Kissinger: When you put it that way, the nuances begin to ac-
cumulate, and pretty soon your position has changed.
Mr. Packard: The outcome is inevitable. If we are to do anything,
we have got to do it aggressively. That is our only chance to turn things
around.
378-376/428-S/80023
426 Foreign Relations, 19691976, Volume XXI
Mr. Irwin: The question is whether the United States has the capa-
bility to do anything to turn things around. All we might accomplish
might be to have the United States looking as though it wants to turn
things around but not being able to do so.
I think that probably the Chilean Government will get into diffi-
culty. Probably the first thing they will want to do is blame the US for
their troubles. To the degree that Allende gets into difficulty and we
have not done anything that will allow him to put the blame on us, we
will be in a better position. There is, of course, the risk that if we do not
do anything Allende will grow stronger. However, we have to consider
how action against Allende on our part may affect our relations with
other Latin American countries.
We also have to take into account that we are dealing with other
communist countries. Ceausescu was received at the White House, and
the President travelled to Yugoslavia. There is a difference in that Chile
is in our back yard. However, there is another difference and that is that
Allende was chosen in free elections, and neither Ceausescu nor Tito
gained power that way. There is the Nixon Doctrine to consider also; it
focuses on negotiation as the approach for working out differences
with the communist world.
Mr. Johnson: If we seem to be picking on Chile, rather than ex-
posing Allendes own mismanagement, we will enable him to raise and
capitalize on nationalist sentiment in Chile.
Dr. Kissinger: Allendes judgment seems to be that the best course
is to present an impression of relative normalcy in his relations with us.
He has leaned over backward to be conciliatory. It appears that our
judgment that overt hostility would help him get elected was not his.
Besides, if he needs hostility, he can get it whenever he wants by expro-
priating the copper industry.
Mr. Irwin: Most of Chilean copper exports do not go to the United
States. Contrast this with the situation in Cuba, which was more de-
pendent on us economically. Our capability to pressure Cuba was a
little greater than what we presently have with regard to Chile, and yet
we did not go ahead and take action.
Mr. Packard: I dont agree. Allende received less than a majority of
the votes. Castro came in with strength. Allende needs time to consoli-
date his position. I think we should move and not give him the time.
Mr. Irwin: The difference in our judgments of the situation is that
we think that what you propose to do will help him consolidate his po-
sition faster.
Mr. Packard: We have to make a fundamental decisionwhether
we are going to move.
Dr. Kissinger: Dont Allendes actions support Daves [Packards]
view that he needs time and wants to get along with us.
378-376/428-S/80023
September 5November 4, 1970 427
Mr. Selden: I read a report of the Secretary of States conversation
with Chilean Foreign Minister Valdes at the UN.
3
Valdes has ties to Al-
lende. Valdes told the Secretary that we were doing the right thing [in
the way we have been handling the situation in Chile]. This indicates to
me that the Soviets and Communist view is that we are doing the right
thing.
Mr. Irwin: We tend to think that he can consolidate his position
faster if we act against him.
Dr. Kissinger: That doesnt seem to be what he is thinking.
Mr. Irwin: We dont know what he thinks. There are various possi-
bilities. (to Kissinger) My own feeling is along the lines of what you and
Armistead [Selden] are saying.
Dr. Kissinger: The argument that Dave [Packard] is making is that
Allende is now in a relatively weak position. All he has going for him is
the Chilean tradition that if you win a plurality, you get the Presidency.
He has the traditional elements in Chile worried, and the military is at
least playing with the idea of a coup. He will have to take over the po-
lice and he will seek to eliminate the opposition bit by bit using salami
tactics. As the devils advocate, one could argue that opposition to Al-
lende will be at the maximum prior to the inauguration and that if we
are going to do something, that is the time.
Mr. Irwin: You can argue that. I believe he will try to consolidate
his position and will perhaps be successful. In the process, he will make
many enemies, for instance, in the military. Thus, as he consolidates, he
will also in a sense be undermining his position. If anyone could say
there are actions we could take to prevent this happening . . .
Dr. Kissinger: There are two questions. Will anything we do pre-
vent his consolidating his position? I dont think that Dave [Packard]
says it will.
Mr. Packard: Thats right. I dont.
Dr. Kissinger: The second question is will we be worse off if we
take action and our action fails?
Mr. Irwin: If it fails, we will not [now?] have created a problem for
ourselves in other Latin American countries, in countries in other parts
of the world or domestically here in the United States.
4
Dr. Kissinger: You could argue that both ways.
Mr. Packard: Thats right.
3
See footnote 2, Document 161. Briefing notes for Rogerss meeting with Valdes are
in the National Archives, RG 59, Conference Files 19661972, Lot 71D227, Box 521, 1970
UNGA, Daily Briefings, Vol. VI.
4
This bracketed correction was added by the editor.
378-376/428-S/80023
428 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger: If the idea gets around in Brazil and Argentina that
we are playing along with Allende, we will be in trouble.
Mr. Meyer: We sent out a circular cable asking all our embassies to
consult with their host governments. The embassies were to say that we
frankly view the situation as not good and to ask what the host gov-
ernments thought we should do about it. The response from the Latin
Americans was: We agree with your evaluation, but please wait and
see how things develop.
Dr. Kissinger: If we implement the State option, will we not even-
tually wind up in an adversary position? I think we have three choices.
One is the Defense option. A second is the Defense option with the
State method, that is, be tough, but limit ourselves to counterpunching.
A third option is to conduct business as close to usual as you can. This
gets Allende into a position where he can use salami tactics.
I dont know the meaning of these phrases (in the State option): if
circumstances permit, if the situation merits. The situation will
always be balled up at any given moment.
One reason we could go along with the non-application of the
Hickenlooper Amendment in the IPC case was that we judged that Ve-
lasco was a nationalist but not unreasonable and that we could keep
some lines open to him.
Mr. Meyer: That is the attitude of the US business community on
Chile today.
Dr. Kissinger: The American business community has long been
proving that Marx was wrong in thinking that businessmen under-
stand their political interests.
Mr. Packard: I think there is an in-between approach. We could de-
cide that the outcome is inevitable, but we ought to try to prevent it if
we can. The first thing to do is to get some of Dicks [Helms] friends
and see what we can do with them. We ought to work out more care-
fully exactly what actions we plan to take. I am not entirely satisfied
with the list of actions that we [Defense] have assembled as of today.
The question is whether we should work hard at doing something
about this problem or let it drift.
Dr. Kissinger: You can work hard from both postures. On the ques-
tion of expropriation, Allendes case will be as good as Velascos.
Mr. Irwin: It might even be better. Allende may pay some
compensation.
Dr. Kissinger: If his strategy is to gain time, he can get even with us
by taking hostile actions that are ambiguous.
I have a question. Is it possible to marry the covert option with the
State option?
Mr. Meyer: There is no problem doing that.
378-376/428-S/80023
September 5November 4, 1970 429
Dr. Kissinger: Wont Allende catch on to what we are doing?
Mr. Meyer: We were blamed for killing General Schneider. Al-
lende will know something is going on. For example, what if a news-
paper continues to publish when he knows it doesnt have any
resources?
Mr. Irwin: It seems to me that covert action just to be doing some-
thing is not a good idea. It is not productive if it doesnt make a signifi-
cant difference in the situation; and there is always the danger it will
become known.
Mr. Helms: At some point we have to make the decision whether
we want Allende around for six more years. We can get along with ei-
ther the State or Defense option. There are a number of ways to whittle
around on our plan of action.
Dr. Kissinger: Jacks [Irwins] point is that even if we decide we
dont want to live with Allende, we cant do much about him.
Mr. Helms: One thing we could do is to decide to put Chile on the
Russian account. Let them pick up the tab for providing aid, military
equipment, and other things to Chile.
Mr. Irwin: There is really no difference on what we want. Neither
State nor Defense wants Allende to stay around for six years.
Dr. Kissinger: The State optionas it is likely to be interpretedis
that if Allende goes, it has to be the result of overwhelmingly Chilean
factors. The Defense option on the other hand involves a vigorous
American effort against him.
Mr. Irwin: State would be happy to see any effective action, covert
or otherwise, that would hasten his departure. However, we dont
want to see the United States blamed. Unless we can take some effec-
tive action, all we can do is play the risks.
Dr. Kissinger: Let me ask a cynical question. Do we care whether
we are blamed if our action succeeds in getting rid of him? Certainly, if
he goes, people will say, Those damned Americans!
Mr. Irwin: Why did we pull back at the Bay of Pigs?
Mr. Selden: It was our action that got rid of Arbenz in Guatemala.
The result is that there is no Communist government there. If the
Chileans know where we stand on Allende it could strengthen his op-
position at home.
Mr. Irwin: All these arguments can be made. It all comes down to a
matter of judgment.
Dr. Kissinger: This will be decided by the NSC.
I have a procedural question. Arent we talking about more than
two options?
There are really two versions of the Defense proposal. One is to
adopt a posture of overt hostility. The other is to let the other fellow
378-376/428-S/80023
430 Foreign Relations, 19691976, Volume XXI
pick a fight. As for the State option, it assumes a hostile relationship but
wants to retain the maximum flexibility. There is also a possible second
version of the State option. That is that we follow a course of action
such that we keep open the option of getting along with Allende on the
off chance that the guy is going to mellow along the way.
Mr. Meyer: One could ask whether taking action against Allende is
consistent with our public posture.
Mr. Johnson: State assumes that there is nothing we can do to bring
down Allende. Therefore, we have got to look down the longer road.
We assume that there will be internal pressures in Chile. Allende will
have to react at some point or change his tack. We have to look toward
having this kind of government in Chile for some time. Any changes
will have to come from within.
Our experience in China and Eastern Europe has demonstrated
that change has come from within. In dealing with these countries, we
have proceeded on the assumption that maintaining a US presence and
boring from within constitutes the more profitable course of action.
That has been our thrust since the 1950s.
Rather than take the initiative to take action aimed at isolating
Chilewhich might convert Chile into another Cubawe would do
better to maintain a presence even if Allende establishes himself.
Things are not immutable. Over time, the situation in Chile may
change.
Dr. Kissinger: There are two versions of the State option. One is as
stated in the options paper. The other is that however things develop
with Allende, it would be better for us to have some position in Chile
than to end up in a Castro-type situation.
Why not try to sharpen up the options with this in mind? We
should state the two versions of the Defense option and, in addition,
look over and improve the list of actions. We should also set forth the
two versions of the State proposal. What Alex [Johnson] just said is a
good basis for this. In addition, we should clarify the meaning of those
phrases like if the situation merits. This is perhaps the most impor-
tant question we have dealt with, and this restatement of the options
will help get us ready for an NSC meeting.
Is there anything else?
Mr. Meyer: There was some press comment about the Presidents
not sending a congratulatory message to Allende. The question now is
whether I take a message when I go down to the inaugural.
Mr. Johnson: I think that all in all saying nothing has turned out to
be the best course of action. Jack [Irwin] may not agree.
Mr. Irwin: I would lean to some sort of message, since we are
sending a delegation. But it is not a critical matter.
378-376/428-S/80023
September 5November 4, 1970 431
Dr. Kissinger: If you want, draft the coolest message you can think
of and send it over.
5
Frankly I dont think the President will put his
name to a message of congratulations for Allende. He thinks Allende
will end up like Castro, and he doesnt want to be on record as con-
gratulating him.
6
Mr. Johnson: Well talk this over some more at State and decide if
we want to propose anything.
5
The Department of State submitted two potential congratulatory messages on Oc-
tober 30 in a telegram to Kissinger and Rogers in San Clemente, California, with the rec-
ommendation that Nixon send a note to President-elect Allende because such messages
have been sent in the past by U.S. Presidents to Latin American Presidents-elect either
upon the occasion of their election or inauguration or both. (Telegram 178771, October
30; National Archives, RG 59, Central Files 197073, POL 151 CHILE)
6
On October 30, a message was sent from the San Clemente White House to the De-
partment of State stating, The President after consultation with Secretary Rogers has in-
structed that the following procedure be followed with regard to the congratulatory note
for the Chilean inaugural. Assistant Secretary Meyer should state orally to Allende, or his
representative if there is no normal ceremonial occasion to meet Allende, that he is au-
thorized to convey to him President Nixons recognition of the great honor and responsi-
bility accorded by the Chilean people in selecting him President of Chile. This oral mes-
sage should not be embellished further. Meyer may say in response to press queries that
he is bringing oral message from President Nixon and later give sense of message,
without, however, quoting anything as precise text. (Ibid., Nixon Presidential Materials,
NSCFiles, Box 774, Country Files, Latin America, Chile, Vol. II) The decision to send only
an oral message was based upon a recommendation made by Vaky. (Memorandum from
Haig to Kissinger, undated; ibid.)
378-376/428-S/80023
432 Foreign Relations, 19691976, Volume XXI
170. Memorandum From Vernon A. Walters to the Presidents
Assistant for National Security Affairs (Kissinger)
1
Washington, November 3, 1970.
SUBJECT
Courses in Latin America
We are engaged in a mortal struggle to determine the shape of the
future of the world. There is no acceptable alternative to holding Latin
America. We simply cannot afford to lose it.
Latin America is a key area in the struggle. Its resources, the social
and economic problems of its population, its proximity to the U.S. and
its future potential make it a priority target for the enemies of the U.S.
We must ensure that it is neither turned against us nor taken over by
those who threaten our vital national interests. In my view there are a
number of courses which we must adopt if we are to ensure that this
continent be denied to those who threaten us and available to us when
we need it.
Courses of Action
1. We can support those who believe that reforms alone will vacci-
nate the area against subversion and hostility towards the United
States. We can support unfriendly governments who maintain a demo-
cratic facade.
OR
We can support those who believe themselves to be threatened by
the same forces which are hostile to us. We can help them to prove that
the conquest of underdevelopment does not require large doses of
Marxism. We cannot measure other American governments by some
sort of U.S. template.
2. We can continue to refuse to sell relatively modern equipment to
the countries of Latin America thus driving them into the arms of
waiting extra continental suppliers. By measured sales we can easily
prevent an arms race, which is in any case more unlikely than in any
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H29, NSC Meeting, Chile, 11/6/70. Secret. Sent for informa-
tion. The memorandum is typed on White House stationery. At the top of the page, Kiss-
inger wrote, Attach to P[resident]s reading for NSC meeting. The President received
the memorandum on November 5 along with other preparatory materials for the Na-
tional Security Council meeting on Chile. He returned the memorandum to Kissinger
with a note that reads, K[issinger]Read the Walters memo again + see that it is imple-
mented in every respect. (Ibid.)
378-376/428-S/80023
September 5November 4, 1970 433
time in the past. Argentina and Brazil, for example, are closer than at
any time since their independence.
OR
We can provide a modicum of modern equipment to friendly gov-
ernments in order to ensure that they remain tied to us. The procure-
ment of foreign equipment inevitably entails the entry of foreign tech-
nicians with their own national interests and ideology. In many cases it
is the lack of modern equipment which drives the Latin American mili-
tary to seek their professional satisfactions outside their chosen profes-
sion, that is, in politics. Operating or attempting to operate the same
equipment as ones father is neither challenging, inspiring nor satis-
fying. The idea that modern equipment will be used to overthrow ci-
vilian governments is ingenuous and incorrect. This can be done with
crossbows.
3. We can tell the South American Armed Forces that their place
within their society must be exactly that which the U.S. Armed Forces
occupy in our country.
OR
We can recognize that conditions there are different. In many cases
both by tradition and constitutionally the Armed Forces have a dif-
ferent role. Often the Constitution gives them the role of guardians of
the national institutions. Military coups by leftist military leaders
arouse no agitation (Boumediene, NGouabi, etc). To many it seems
normal and helpful to invite Tito or Ceaucescu, but to invite Medici or
Levingston would be anathema.
4. We can take Latin America for granted, pay little attention to our
friends there, tell them that the only mission of their armed forces is in-
ternal security and feel confident that they have nowhere else to go
anyway. We can drive them from a position of warm friendship to the
waiting arms of the leftists, whose main priorities are the infiltration of
the Church and the military. We can let ideology, not our national in-
terests, determine our policies towards the South American continent.
OR
We can recognize that the South American military do have some-
where else to go. We can give them a sense of participation and consul-
tation as we give our European allies (some of whom are not as reliable
as for instance Brazil). We can collaborate with friendly regimes and
help them to solve their grave economic and social problems in a non-
Marxist framework. If we help, we can influence them. By the end of
this century there will be half a billion people in this area, sitting on
perhaps the largest untapped sources of raw materials and energy
sources. By the end of the century Brazil will have two hundred million
378-376/428-S/80023
434 Foreign Relations, 19691976, Volume XXI
people. Today it has a population almost equal to that of France and
Britain put together.
2
5. We can seek to do everything by ourselves, or we can use the
more developed countries to help the less developed ones. Argentina
and Brazil would in many cases have more acceptability, affinity and a
lower profile than we do.
The situation in South America has been deteriorating steadily
from our point of view. The coddling of leftists as in Chile has been
proven a failure. This situation will continue unless we take positive
steps to change it. To do this, I believe we must adopt the following
courses of action.
A. Make clear that we have a commitment to help them achieve
their aspirations. We will increasingly need their help in the years
ahead to face the growing strength of the USSR and Red China. A
strong developed Brazil and Argentina could do much to redress the
balance.
B. We must give them a sense of recognition and participation. We
must give careful treatment to their representatives in the U.S. (Both
the Presidents of Argentina and Brazil have been military attaches in
the U.S. in recent years.) We must increase, not reduce, our program for
visits by key groups to the U.S., both in and out of the Armed Forces.
C. We must provide on a sales basis a modicum of modern military
equipment for these countries. We must not tell them that their only
mission is internal security. History has proved this false (World War
II, Korea, the Congo, Suez, the Dominican Republic, etc.). Some day we
may want them to do something that we ourselves do not want to do.
We must encourage them to cooperate with one another (Police Forces,
emergency forces, anti-submarine warfare, etc.). Above all, we must
keep alive the idea of a common destiny.
D. We must assist our friends to solve their economic, financial
and social problems. If they do not then the alternative is Allende or
worse. The idea that all military leaders are necessarily unpopular is
childish and false. President Medici received a roaring ovation from
over a hundred thousand people in Maracan Stadium in Rio when he
attended a football game there.
E. We must help the one-crop, one-product nations to diversify
their economies and markets. Management assistance must be made
available (Frank Paces organization which provides retired U.S. execu-
tives for periods not to exceed three months is an excellent beginning).
3
2
President Nixon wrote, This is my preference, in the margin to the left of this
paragraph.
3
Former Secretary of the Army Frank Pace, along with David Rockefeller, estab-
lished the International Executive Service Corps.
378-376/428-S/80023
September 5November 4, 1970 435
We must help those countries which are technically incapable of doing
so to catalogue their resources and establish their priorities. Above all,
we must project an image of friendly understanding and willingness to
help. (This is more important perhaps than the aid itself.) We must be
able to take decisive action rapidly without endless study groups and
feasibility studies (for which they often pay).
F. The alternative to doing the above may be a beleaguered fortress
in North America. If we move actively (not necessarily openly) against
our opponents, they will respect us for it.
4
They want to believe in us. If
we disappoint them as to our will and resolution to defend freedom, it
will be at our own peril. Whatever may be the differences between the
USSR and China, they both have as a major objective the removal of the
United States as a power factor from all areas outside of North
America.
5
They can and are cooperating to this end in Latin America.
We must meet that challenge.
Vernon A. Walters
Major General, U.S. Army
Attachment
6
Specific Actions in the Military Field in Latin America
First and foremost, we must improve the quality of our diplomatic
and military representation in Latin America. This area should not be-
come the refuge of incompetence and mediocrity.
1. We must provide a modicum of modern military equipment to
the Latin nations, particularly to the larger and more responsible ones.
(Everyone is equal, but in Europe Germany is more equal than Den-
mark. We recognize this.)
2. Instead of telling the nations of Latin America that their only
mission is internal security, we must give them a sense of participation
in the defense of freedom. By large-scale visits at different levels we
must keep alive the sense of common destiny that makes God bless
America their song too.
3. Much greater attention must be paid to the military repre-
sentatives of the Latin American nations in Washington. These are the
future leaders of their Armed Forces or they would not be here. (The
Presidents of both Brazil and Argentina have been Military Attaches in
4
President Nixon underlined this sentence and noted in the left margin, This
should be our line.
5
President Nixon underlined this sentence.
6
Secret.
378-376/428-S/80023
436 Foreign Relations, 19691976, Volume XXI
the recent past in Washington. Both carried away a sense of having
been slighted while here.
4. More frequent visits to Latin America by top Defense Depart-
ment officials and senior U.S. officers. Compared with visits to Europe
by such officials, the ratio to South America is negligible.
5. A much enlarged program of visits by key Latin American
figures and general staff schools to the U.S. must be prepared. Visits to
U.S. Forces in Europe and Vietnam would be helpful also. Panama with
its Latin American schools also plays a key role. The Four Star job at
SouthCom should NOT be reduced to 3 stars. This would be consid-
ered a clear indication of loss of interest by the U.S.
6. We must provide Vietnamization type training BEFORE, not
AFTER, insurgency starts in the Latin American area.
7. We must be prepared to let Brazil or Argentina sometimes carry
the ball instead of doing it ourselves. We must not always try to do ev-
erything our way, by ourselves. The Soviet Union has given us many
excellent examples of how to do things by proxy.
8. We must make the nations of Latin America understand that
their interests go beyond their own borders and that our greater in-
terest and help must be matched by their greater sense of responsibility
and sharing in the defense of freedom wherever it may be threatened.
VAW
171. Briefing Memorandum From the Acting Assistant Secretary
of State for Inter-American Affairs (Hurwitch) and the
Director of the Policy Planning Staff (Hartman) to Secretary
of State Rogers
1
Washington, November 3, 1970.
SUBJECT
NSC Meeting on Chile, Thursday, November 5, 1970, 3:00 p.m.
The assumption of power in Chile by the Allende government is
clearly a setback for the U.S. and a gain for our opponents. Neverthe-
less, the manner in which the U.S. treats Chile under a democratically-
1
Source: Department of State, S/SNSDM Files, Lot 83D305. Secret; Sensitive. Sent
through Irwin, Johnson, and S/S. A copy was sent to Irwin, Johnson, and Pedersen.
378-376/428-S/80023
September 5November 4, 1970 437
elected Marxist President, in a hemisphere where a key current issue is
U.S. domination, can incur even more serious losses for us in the hemi-
sphere and elsewhere in the world. With respect to Latin America, our
future role in the hemisphere may well be at stake. The policy we adopt
toward Chile is, therefore, a watershed decision.
U.S. policy toward Chile will be assessed by many governments
and their peoples as a test of the U.S. announced policy of respect for
the outcome of democratic elections. Failure on our part to act from the
outset in a manner consistent with that policy would reduce our credi-
bility throughout the world. Such failure would probably also: increase
nationalism directed against us and divert attention from the real issue
of the potential establishment of an authoritarian Marxist state; be used
by the Allende government to consolidate its position with the Chilean
people and to gain influence in the rest of the hemisphere, where other
governments are also facing threats from leftist nationalist forces; and
move the Allende government to seek even closer relations with the
USSR than it might have initially contemplated.
Respect for the outcome of the elections and awareness of the in-
tensity of Latin American nationalism carry with them the obligation
that the U.S. manifest, at the least, a deliberate, restrained attitude and
that we refrain from overt actions which could be interpreted by Latin
American governments and others as hostile and without evident and
warranted basis. This posture would mean that, in the main, we re-
spond to situations rather than take initiatives. Although the Allende
governments ultimate goals appear clearthe establishment of an au-
thoritarian Marxist statethe route he may be forced to take because of
the problems he will face, is marked by many, perhaps important, un-
knowns which may provide us with unforeseen opportunities to exer-
cise our influence.
Another fundamental consideration in dealing with Chile is a real-
istic assessment of U.S. capability to influence the situation there. We
believe that developments in Chile will be primarily controlled by the
Allende government and by its reactions to internal pressures. U.S.
overt and covert capabilities to force the course of events positively in
our favor, short of the use of armed force, are marginal at best, and for
the reasons described above as well as the considerable risks of expo-
sure, could be seriously counter-productive.
Our consultations with the other American republics reveal that
they share our concern over developments in Chile, but in the main
have adopted a wait and see attitude and counsel us to do the same.
To date, Chile has not become a major political issue in the U.S.;
predominant editorial reaction has been to compliment the administra-
tion for its restrained reaction to events in Chile. We expect that as time
passes Chile may become more of a political issue accompanied by crit-
378-376/428-S/80023
438 Foreign Relations, 19691976, Volume XXI
icism as to why we havent done something about Chile. If by our ac-
tions and attitudes, however, we have contributed to a worse situation
in Chile and elsewhere in the hemisphere, the criticism will be even
greater.
The paper describes four policy options.
2
Although for tactical
reasons Options A and B appear as distinct options, Option A is in re-
ality an exposition of the philosophy underlying Option B, and we re-
gard them as one option. Taken together, they provide that the U.S.
should maintain publicly a restrained, deliberate attitude toward Chile,
and should seek to respond to developments as they occur, in a manner
under which we would not take the initiative in actions that would iso-
late us from Chile. The courses of action listed under Option B are
equally applicable to Option A. Should circumstances so require, there
are several courses of action listed under Options C and D that could
also be followed under Option A/B. In sum, Option A/B, together with
the stated assumptions and introductory comments for the options,
offers a good rationale for our actions and at the same time provides us
a wide latitude to meet probable developments in Chile.
Option C proposes that early on we publicly and repetitively ex-
press our concern over developments in Chile by making publicly clear
our opposition to the emergence of a Communist government in Latin
America. This option provides otherwise that the United States would
react to developments in Chile rather than take initiatives in advance of
them.
Option D proposes that from the outset we adopt the public pos-
ture of an adversary toward Chile and place into effect immediately
certain economic, political and diplomatic measures. These measures
would seek to prevent Allende from consolidating his position, but we
believe they would be entirely inadequate for that end and would risk
being counter-productive.
ARAS/PC recommends that at least for the next several months
the United States should continue its restrained, deliberate posture, re-
fraining to the extent possible from commenting publicly upon Chilean
developments, while retaining our flexibility to meet situations in Chile
as they arise. Option A/B is suitable for these purposes; Options C and
Dare not, in that they would place us in too prominent a public posture
and in the case of Option D would have us take actions without evi-
dence convincing to others that such actions were warranted.
There is also attached a talking points paper
3
which, based upon
inter-agency meetings regarding Chile, lists questions you may be
asked and their suggested answers.
2
See Document 33 in Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973.
3
Attached but not printed.
378-376/428-S/80023
Cool and Correct: The U.S. Response to the
Allende Administration, November 5, 1970
December 31, 1972
172. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, November 5, 1970.
SUBJECT
NSC Meeting, November 6Chile
This meeting will consider the question of what strategy we
should adopt to deal with an Allende government in Chile.
2
A. Dimensions of the Problem
The election of Allende as President of Chile poses for us one of the most
serious challenges ever faced in this hemisphere. Your decision as to what to
do about it may be the most historic and difficult foreign affairs deci-
sion you will have to make this year, for what happens in Chile over the
next six to twelve months will have ramifications that will go far be-
yond just US-Chilean relations. They will have an effect on what
happens in the rest of Latin America and the developing world; on
what our future position will be in the hemisphere; and on the larger
world picture, including our relations with the USSR. They will even
affect our own conception of what our role in the world is.
Allende is a tough, dedicated Marxist. He comes to power with a
profound anti-US bias. The Communist and Socialist parties form the
core of the political coalition that is his power base. Everyone agrees that
Allende will purposefully seek:
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H29, NSC Meeting, Chile, 11/6/70. Secret; Sensitive. Printed
from an uninitialed copy.
2
The meeting of the National Security Council scheduled for November 5 was post-
poned until November 6 on a recommendation from Kissinger. Dwight Chapin ex-
plained in a November 4 memorandum to Haldeman, Henry Kissinger came in this
morning to try to see if we could move the NSC Meeting to Friday. He feels this is very
important because the subject matter is Chile and Henry says it is imperative that the
President study the issue prior to holding the meeting. According to Henry, Chile could
end up being the worst failure in our administrationour Cuba by 1972. Henry feels
that he needs to spend an hour with the President on the subject prior to holding a
meeting of the NSC. (Ibid.) Copies of talking points prepared for President Nixon and
for Kissinger prior to the meeting are ibid.
439
378-376/428-S/80023
440 Foreign Relations, 19691976, Volume XXI
to establish a socialist, Marxist state in Chile;
to eliminate US influence from Chile and the hemisphere;
to establish close relations and linkages with the USSR, Cuba
and other Socialist countries.
The consolidation of Allende in power in Chile, therefore, would pose
some very serious threats to our interests and position in the hemisphere, and
would affect developments and our relations to them elsewhere in the
world:
US investments (totaling some one billion dollars) may be lost,
at least in part; Chile may default on debts (about $1.5 billion) owed the
US Government and private US banks.
Chile would probably become a leader of opposition to us in the
inter-American system, a source of disruption in the hemisphere, and a
focal point of support for subversion in the rest of Latin America.
It would become part of the Soviet/Socialist world, not only
philosophically but in terms of power dynamics; and it might consti-
tute a support base and entry point for expansion of Soviet and Cuban
presence and activity in the region.
The example of a successful elected Marxist government in Chile
would surely have an impact onand even precedent value forother
parts of the world, especially in Italy; the imitative spread of similar
phenomena elsewhere would in turn significantly affect the world bal-
ance and our own position in it.
While events in Chile pose these potentially very adverse conse-
quences for us, they are taking a form which makes them extremely difficult
for us to deal with or offset, and which in fact poses some very painful di-
lemmas for us:
a. Allende was elected legally, the first Marxist government ever to
come to power by free elections. He has legitimacy in the eyes of
Chileans and most of the world; there is nothing we can do to deny him
that legitimacy or claim he does not have it.
b. We are strongly on record in support of self-determination and
respect for free election; you are firmly on record for non-intervention
in the internal affairs of this hemisphere and of accepting nations as
they are. It would therefore be very costly for us to act in ways that ap-
pear to violate those principles, and Latin Americans and others in the
world will view our policy as a test of the credibility of our rhetoric.
On the other hand, our failure to react to this situation risks being
perceived in Latin America and in Europe as indifference or impotence
in the face of clearly adverse developments in a region long considered
our sphere of influence.
c. Allendes government is likely to move along lines that will
make it very difficult to marshal international or hemisphere censure of
378-376/428-S/80023
November 5, 1970December 31, 1972 441
himhe is most likely to appear as an independent socialist country
rather than a Soviet satellite or Communist government.
Yet a Titoist government in Latin America would be far more dan-
gerous to us than it is in Europe, precisely because it can move against
our policies and interests more easily and ambiguously and because its
model effect can be insidious.
Allende starts with some significant weaknesses in his position:
There are tensions in his supporting coalition.
There is strong if diffuse resistance in Chilean society to moving
to a Marxist or totalitarian state.
There is suspicion of Allende in the military.
There are serious economic problems and constraints.
To meet this situation, Allendes immediate game plan is clearly to
avoid pressure and coalescing of opposition prematurely, and to keep
his opponents within Chile fragmented so that he can neutralize them
one by one as he is able. To this end, he will seek to:
be internationally respectable;
move cautiously and pragmatically;
avoid immediate confrontations with us; and
move slowly in formalizing relations with Cuba and other So-
cialist countries.
There is disagreement among the agencies as to precisely how suc-
cessful Allende will be in overcoming his problems and weaknesses, or
how inevitable it really is that he will follow the course described or
that the threats noted will materialize.
But the weight of the assessments is that Allende and the forces that have
come to power with him do have the skill, the means and the capacity to main-
tain and consolidate themselves in power, provided they can play things
their way. Logic would certainly argue that he will have the motivation
to pursue purposefully aims he has after all held for some 25 years.
Since he has an admittedly profound anti-US and anti-capitalist bias,
his policies are bound to constitute serious problems for us if he has
any degree of ability to implement them.
B. The Basic Issue
What all of this boils down to is a fundamental dilemma and issue:
a. Do we wait and try to protect our interests in the context of
dealing with Allende because:
we believe we cannot do anything about him anyway;
he may not develop into the threat we fear or may mellow in
time;
we do not want to risk turning nationalism against us and dam-
aging our image, credibility and position in the world;
378-376/428-S/80023
442 Foreign Relations, 19691976, Volume XXI
AND thereby risk letting Allende consolidate himself and his ties with
Cuba and the USSR, so that a year or two from now when he has estab-
lished his base he can move more strongly against us, and then we
really will be unable to do anything about it or reverse the process. Al-
lende would in effect use us to gain legitimacy and then turn on us on
some economic issue and thereby caste us in the role of Yankee imper-
ialist on an issue of his choice.
OR
b. Do we decide to do something to prevent him from consoli-
dating himself now when we know he is weaker than he will ever be
and when he obviously fears our pressure and hostility, because:
we can be reasonably sure he is dedicated to opposing us;
he will be able to consolidate himself and then be able to counter
us in increasingly intense ways; and
to the extent he consolidates himself and links to the USSR and
Cuba the trend of events and dynamics will be irreversible.
AND thereby risk:
giving him the nationalistic issue as a weapon to entrench
himself;
damaging our credibility in the eyes of the rest of the world as
interventionist;
turning nationalism and latent fear of US domination in the rest
of Latin America into violent and intense opposition to us; and
perhaps failing to prevent his consolidation anyway.
C. Our Choices
There are deep and fundamental differences among the agencies on this
basic issue. They manifest themselves in essentially three possible
approaches:
1. The Modus Vivendi Strategy:
This school of thought, which is essentially States position, argues
that we really do not have the capability of preventing Allende from consoli-
dating himself or forcing his failure; that the main course of events in
Chile will be determined primarily by the Allende government and its
reactions to the internal situation; and that the best thing we can do in
these circumstances is maintain our relationship and our presence in
Chile so that over the long haul we may be able to foster and influ-
encing domestic trends favorable to our interests. In this view actions
to exert pressure on Allende or to isolate Chile will not only be ineffec-
tive, but will only accelerate adverse developments in Chile and limit
our capacity to have any influence on the long-range trend.
In this view the risks that Allende will consolidate himself and the
long-range consequences therefrom are less dangerous to us than the
378-376/428-S/80023
November 5, 1970December 31, 1972 443
immediate probable reaction to attempts to oppose Allende. Its percep-
tion of Allendes long-term development is essentially optimistic and
benign. Implicit is the argument that it is not certain he can overcome
his internal weaknesses, that he may pragmatically limit his opposition
to us, and that if he turns into another Tito that would not be bad since
we deal with other governments of this kind anyway.
2. The Hostile Approach:
DOD, CIA and some State people, on the other hand, argue that it
is patent that Allende is our enemy, that he will move counter to us just
as soon and as strongly as he feels he can; and that when his hostility is
manifest to us it will be because he has consolidated his power and then
it really will be too late to do very muchthe process is irreversible. In
this view, therefore, we should try to prevent him from consolidating
now when he is at his weakest.
Implicit in this school of thought is the assumption that we can af-
fect events, and that the risks of stirring up criticism to our position
elsewhere are less dangerous to us than the long-term consolidation of
a Marxist government in Chile.
Within this approach there are in turn two schools of thought:
a. Overt Hostility.
This view argues that we should not delay putting pressure on Al-
lende and therefore should not wait to react to his moves with counter-
punches. It considers the dangers of making our hostility public or of
initiating the fight less important than making unambiguously clear
what our position is and where we stand. It assumes that Allende does
not really need our hostility to help consolidate himself, because if he
did he would confront us now. Instead he appears to fear our hostility.
This approach therefore would call for (1) initiating punitive meas-
ures, such as terminating aid or economic embargo; (2) making every
effort to rally international support of this position; and (3) declaring
and publicizing our concern and hostility.
b. Non-overt Pressure, Cold, Correct Approach.
This approach concurs in the view that pressure should be placed
on Allende now and that we should oppose him. But it argues that how
we package that pressure and opposition is crucial and may make the
difference between effectiveness and ineffectiveness. It argues that an
image of the US initiating punitive measures will permit Allende to
marshal domestic support and international sympathy on the one
hand, and make it difficult for us to obtain international cooperation on
the other. It further argues that it is the effect of pressure not the posture
of hostility that hurts Allende; the latter gives him tactical opportu-
nities to blunt the impact of our opposition.
378-376/428-S/80023
444 Foreign Relations, 19691976, Volume XXI
Implicit in this approach is the judgment that how unambiguous
our public position is and making a public record are all less important
in the long run than maximizing our pressure and minimizing risks to
our position in the rest of the world.
This approach therefore calls for essentially the same range of
pressures as the previous one, but would use them quietly and co-
vertly; on the surface our posture would be correct, but cold. Any
public manifestation or statement of hostility would be geared to his
actions to avoid giving him the advantage of arguing he is the ag-
grieved party.
D. Assessments
As noted, the basic issue is whether we are to wait and try to adjust or act
now to oppose.
The great weakness in the modus vivendi approach is that:
it gives Allende the strategic initiative;
it plays into his game plan and almost insures that he will con-
solidate himself;
if he does consolidate himself, he will have even more freedom
to act against us after a period of our acceptance of him than if we had
opposed him all along;
there are no apparent reasons or available intelligence to justify
a benign or optimistic view of an Allende regime over the long term. In
fact, as noted, an independent rational socialist state linked to Cuba
and the USSR can be even more dangerous for our long-term interests
than a very radical regime.
There is nothing in this strategy that promises to deter or prevent
adverse anti-U.S. actions when and if Chile wants to pursue themand
there are far more compelling reasons to believe that he will when he
feels he is established than that he will not.
The main question with the hostile approach is whether we can ef-
fectively prevent Allende from consolidating his power. There is at
least some prospect that we can. But the argument can be made that
even if we did not succeedprovided we did not damage ourselves
too severely in the processwe could hardly be worse off than letting
him entrench himself; that there is in fact some virtue in posturing our-
selves in a position of opposition as a means of at least containing him
and improving our chance of inducing others to help us contain him
later if we have to.
In my judgment the dangers of doing nothing are greater than the risks
we run in trying to do something, especially since we have flexibility in
tailoring our efforts to minimize those risks.
I recommend, therefore that you make a decision that we will op-
pose Allende as strongly as we can and do all we can to keep him from
378-376/428-S/80023
November 5, 1970December 31, 1972 445
consolidating power, taking care to package those efforts in a style that
gives us the appearance of reacting to his moves.
E. The NSC Meeting
Contrary to your usual practice of not making a decision at NSC
meetings, it is essential that you make it crystal clear where you stand
on this issue at todays meeting. If all concerned do not understand that
you want Allende opposed as strongly as we can, the result will be a
steady drift toward the modus vivendi approach. This is primarily a
question of priorities and nuance. The emphasis resulting from todays
meeting must be on opposing Allende and preventing his consoli-
dating power and not on minimizing risks.
I recommend that after your opening remarks you call on Dick
Helms to give you a briefing on the situation and what we might ex-
pect. I would then outline the main issues and options along the above
lines, after which you could call on Secretaries Rogers and Laird for
their views and observations. Your Talking Points, which are ap-
pended, are written along these lines.
3
Also included in your book are:
A State/DOD options paper.
An analytical summary of that options paper.
4
3
Attached but not printed.
4
See Document 167 and footnote 1 thereto.
378-376/428-S/80023
446 Foreign Relations, 19691976, Volume XXI
173. Memorandum of Conversation of a Meeting of the National
Security Council
1
Washington, November 6, 1970, 9:40 a.m.
PARTICIPANTS
The President
The Vice President
Secretary of State William P. Rogers
Secretary of Defense Melvin Laird
Director of Emergency Preparedness George A. Lincoln
Attorney General John N. Mitchell
General William Westmoreland, Acting Chairman, Joint Chiefs of Staff
Director of Central Intelligence Richard Helms
Under Secretary of State John N. Irwin II
Deputy Assistant Secretary of State Robert A. Hurwitch
Assistant to the President for National Security Affairs Henry A. Kissinger
General Alexander M. Haig, NSC Staff
Mr. Arnold Nachmanoff, NSC Staff
Col. Richard T. Kennedy, NSC Staff
The President opened the meeting by asking Director Helms to
brief.
Director Helms read from the briefing paper which is attached at
Tab A.
2
The President interrupted to review what Director Helms said
about the makeup of the Allende Cabinet. [See page 9] He wished to
emphasize the degree to which the Cabinet ministries were controlled
by Marxists.
The President then asked Dr. Kissinger to brief.
Dr. Kissinger: All of the agencies are agreed that Allende will try to
create a socialist State. As for our response to this, the SRG came up
with four options.
3
But really basically it amounts to two choices:
(1) seek a modus vivendi with the Allende government, or (2) adopt a
posture of overt and frank hostility. In between is a third possibility:
adopt what is in fact a hostile posture but not from an overt stance, that
is, to move in hostility from a low-key posture.
A modus vivendi has the risk that he will consolidate his position
and then move ahead against us. A posture of overt hostility gives
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files, (H-Files) Box H29, NSC Meeting, Chile, 11/6/70. Secret; Sensitive. Ac-
cording to the Presidents Daily Diary, the meeting went until 10:53 a.m. (Ibid., White
House Central Files, Presidents Daily Diary) The meeting took place in the White House
Cabinet Room. All brackets are in the original.
2
Helmss briefing is Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973, Document 35.
3
See Document 169.
378-376/428-S/80023
November 5, 1970December 31, 1972 447
strength to his appeal of nationalism and may not work anyway. As for
in betweenthe problem is that he will know we are working against
him and he can expose us anyway even though we maintain a correct
and cool posture.
All of these options have advantages and disadvantages. There is
no clear choice.
Secretary Rogers: Dr. Kissinger has spelled it out well. There is
general agreement that he will move quickly to bring his program into
effect and consolidate his position. We are also in agreement that it is
not necessary to make a final decision now.
Private business and the Latin American countries believe that we
have done the right things up to now. If we have to be hostile, we want
to do it right and bring him down. A stance of public hostility would
give us trouble in Latin America. We can put an economic squeeze on
him. He has requested a debt rescheduling soonwe can be tough. We
can bring his downfall perhaps without being counterproductive.
The Christian Democratic Foreign Minister thinks we are doing
the right thing. He sees two possibilities: that his economic troubles will
generate significant public dissatisfaction, or second, that his diffi-
culties will become so great that there will be military moves against
him. I think the U.S. military should keep in contact with their Chilean
colleagues and try to strengthen our position in Chile.
We have severe limitations on what we can do. A strong public
posture will only strengthen his hand. We must make each decision in
the future carefully in a way that harms him most but without too
much of a public posture which would only be counterproductive.
Secretary Laird: I agree with Bill Rogers. We have to do everything
we can to hurt him and bring him down, but we must retain an out-
ward posture that is correct. We must take hard actions but not publi-
cize them. We must increase our military contacts. We must put pres-
sure on him economically. He is in the weakest position now that he
will be in; we want to prevent his consolidation.
Moorer [to Rogers]: What is the reaction of the Congress?
Secretary Rogers: There is very little, but if he consolidates his po-
sition the criticism will build up. Attitudes are therefore favorable to
our policy.
Moorer: What would be the reaction if he resorts to expropriation
later, after we have given more aid?
Secretary Rogers: We shouldnt give any more credit guarantees.
We should do everything we can to show hostility without publicizing
it.
Vice President: China and USSR are watching our approach to Ar-
gentina. If we show undue interest before anything happens; for ex-
378-376/428-S/80023
448 Foreign Relations, 19691976, Volume XXI
ample if we sell F4s to Argentina, it could trigger massive support to
Chile fromthe USSR and China. We should act principally inside Chile.
Director Lincoln: Copper accounts for 80% of Chiles exports. They
are expanding production rapidly. Other producers (Zambia, Aus-
tralia, etc.) are also going up in production. So there could be a price de-
cline in the future, with an adverse economic impact in Chile. They
blame us. We have a stockpile. If we are adopting a hostile posture,
maybe we have to increase the stockpile or alternatively to sell if the
market eases in the future.
The President: I want something in a week on how we can sell
from the stockpile. Now we can do it. Cutting the stockpile would hurt
Chile and also save on the budget.
Director Lincoln: Well do this. Weve been studying this on a pri-
ority basis.
The President: This is very importantwill it hurt anyone else? I
want State and Defense and everyone to study it. It could be the most
important thing we can do.
Director Lincoln: The law says we cant sell from the stockpile
unless we do it to stabilize the price. The copper price is down in the
world market. Weve already sold 50 million tons before the prices
dropped.
Secretary Rogers: Can we help others build up their production, to
help our friends?
The President: We should do this if we can.
Director Lincoln: If we sell anything too fast it will destabilize the
price. Most things dont sell fast.
Mr. Irwin: The problem is how to bring about his downfall. I
would question our capability to do it. Internal forces in Chile are the
only way. The question is how best to influence the internal forces to
create the conditions for change. He will need to consolidate his posi-
tion and probably he will move slowly for the sake of respectability as
he moves. It will be soon that dissatisfaction begins. As he tries to con-
solidate he will inevitably have strains. If we move too quickly in oppo-
sition to him we will help him consolidate quickly. As we move to con-
sider specific issues either overt or covert, we should be hostile only if
we can be sure it will have a significant effect on the internal forces
there in a way that will hurt Allende and prevent his consolidation.
This may mean we may have to do things we would not want to doit
depends on the effects on the internal situation in Chile. Graham
Martin would like to see us move along as we have.
The President: It is all a matter of degree. If Chile moves as we ex-
pect and is able to get away with itour public posture is important
hereit gives courage to others who are sitting on the fence in Latin
378-376/428-S/80023
November 5, 1970December 31, 1972 449
America. Lets not think about what the really democratic countries in
Latin America saythe game is in Brazil and Argentina. We could
have moves under the surface which bring over time the same thing.
I will never agree with the policy of downgrading the military in
Latin America. They are power centers subject to our influence. The
others (the intellectuals) are not subject to our influence. We want to
give them some help. Brazil and Argentina particularly. Build them up
with consultation. I want Defense to move on this. Well go for more in
the budget if necessary.
Our main concern in Chile is the prospect that he can consolidate
himself and the picture projected to the world will be his success. A
publicly correct approach is right. Privately we must get the message to
Allende and others that we oppose him. I want to see more of them;
Brazil has more people than France or England combined. If we let the
potential leaders in South America think they can move like Chile and
have it both ways, we will be in trouble. I want to work on this and on
the military relationsput in more money. On the economic side we
want to give him cold turkey. Make sure that EXIM and the interna-
tional organizations toughen up. If Allende can make it with Russian
and Chinese help, so be itbut we do not want it to be with our help,
either real or apparent.
Well be very cool and very correct, but doing those things which
will be a real message to Allende and others.
This is not the same as Europewith Tito and Ceaucescuwhere
we have to get along and no change is possible. Latin America is not
gone, and we want to keep it. Our Cuban policy must not be changed. It
costs the Russians a lot; we want it to continue to cost. Chile is gone
toohe isnt going to mellow. Dont have any illusionshe wont
change. If there is any way we can hurt him whether by government or
private businessI want them to know our policy is negative. There
should be no guarantees. Cut back existing guarantees if its possible.
No impression should be permitted in Latin America that they can
get away with this, that its safe to go this way. All over the world its
too much the fashion to kick us around. We are not sensitive but our re-
actions must be coldly proper. We cannot fail to show our displeasure.
We cant put up with Give Americans hell but pray they dont go
away. There must be times when we should and must react, not be-
cause we want to hurt them but to show we cant be kicked around.
The new Latin politicians are a new breed. They use anti-
Americanism to get power and then they try to cozy up. Maybe it
would be different if they thought we wouldnt be there.
We must be proper on the surface with Allende, but otherwise we
will be tough. He is not going to change; only self-interest will affect
him.
378-376/428-S/80023
450 Foreign Relations, 19691976, Volume XXI
174. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, November 6, 1970.
SUBJECT
Allende Aid to Latin American Revolutionaries
A reliable CIA source reports that during the week of 1824 Oc-
tober 1970, Salvador Allende held a clandestine meeting with leaders of
the Chilean National Liberation Army (a radical group created to sup-
port the Bolivian revolutionary movement) and with representatives of
the Brazilian National Liberating Action. Allende told them that Chile
will become a center of assistance and training for Latin American rev-
olutionary organizations seeking to liberate their countries through
armed struggle once his administration is firmly in power.
Allende told the group of revolutionaries that the future gov-
ernment of Chile will provide their organizations with guerrilla
training installations, political and insurgency training, financial sup-
port and refuge for their personnel. He noted that the Chilean Govern-
ment will have to provide that support in a clandestine manner to
avoid becoming isolated and blockaded like Cuba.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret. Sent for information. President Nixon
wrote at the end of the memorandum: I want this leaked to a columnist. Give me a re-
port. Haig wrote in the margin, Done. AH. For the likely outlet for the leak, see Row-
land Evans and Robert Novak, Menacing Takeover in Chile, Washington Post, No-
vember 13, 1970, p. A27.
378-376/428-S/80023
November 5, 1970December 31, 1972 451
175. National Security Decision Memorandum 93
1
Washington, November 9, 1970.
TO
Secretary of State
Secretary of Defense
Director, Office of Emergency Preparedness
Director of Central Intelligence
SUBJECT
Policy Towards Chile
Following the discussion at the meeting of the National Security
Council on November 6, 1970,
2
the President has decided that the basis
for our policy toward Chile will be the concept underlying Option C of
the Interagency paper submitted November 3, 1970 by the Department
of State
3
for the consideration of the National Security Council as out-
lined in the guidelines set forth below.
The President has decided that (1) the public posture of the United
States will be correct but cool, to avoid giving the Allende government
a basis on which to rally domestic and international support for consol-
idation of the regime; but that (2) the United States will seek to maxi-
mize pressures on the Allende government to prevent its consolidation
and limit its ability to implement policies contrary to U.S. and hemi-
sphere interests.
Specifically, the President has directed that within the context of a
publicly cool and correct posture toward Chile:
vigorous efforts be undertaken to assure that other governments
in Latin America understand fully that the U.S. opposes consolidation
of a communist state in Chile hostile to the interests of the United States
and other hemisphere nations, and to the extent possible encourage
them to adopt a similar posture.
close consultation be established with key governments in Latin
America, particularly Brazil and Argentina, to coordinate efforts to op-
pose Chilean moves which may be contrary to our mutual interests;
in pursuit of this objective, efforts should be increased to establish
1
Source: National Security Council, National Security Decision Memorandum 93.
Top Secret; Sensitive; Eyes Only. A copy was sent to the Secretary of the Treasury, the
Administrator of AID, the Director of the Office of Management and Budget, and the
Chairman of the Joint Chiefs of Staff.
2
See Document 173.
3
The paper is Document 33 in Foreign Relations, 19691976, vol. E16, Documents
on Chile, 19691973.
378-376/428-S/80023
452 Foreign Relations, 19691976, Volume XXI
and maintain close relations with friendly military leaders in the
hemisphere.
necessary actions be taken to:
a. exclude, to the extent possible, further financing assistance or
guarantees for U.S. private investment in Chile, including those related
to the Investment Guarantee Program or the operations of the Export-
Import Bank;
b. determine the extent to which existing guarantees and financing
arrangements can be terminated or reduced;
c. bring maximum feasible influence to bear in international finan-
cial institutions to limit credit or other financing assistance to Chile (in
this connection, efforts should be made to coordinate with and gain
maximum support for this policy from other friendly nations, particu-
larly those in Latin America, with the objective of lessening unilateral
U.S. exposure); and
d. assure that U.S. private business interests having investments or
operations in Chile are made aware of the concern with which the U.S.
Government views the Government of Chile and the restrictive nature
of the policies which the U.S. Government intends to follow.
no new bilateral economic aid commitments be undertaken with
the Government of Chile (programs of a humanitarian or private social
agency character will be considered on a case by case basis); existing
commitments will be fulfilled but ways in which, if the U.S. desires
to do so, they could be reduced, delayed or terminated should be
examined.
The President has directed that the Director of the Office of Emer-
gency Preparedness prepare a study which sets forth the implications
of possible developments in world copper markets, stockpile disposal
actions and other factors as they may affect the marketing of Chilean
copper and our relationships with Chile.
The President also has directed that the Senior Review Group meet
monthly or more frequently as necessary to consider specific policy
issues within the framework of this general posture, to report actions
which have been taken, and to present to him further specific policy
questions which may require his decision. To facilitate this process the
President has directed the establishment of an Ad Hoc Interagency
Working Group, comprising representatives of the Secretaries of State
and Defense, the Director of Central Intelligence, and the Presidents
Assistant for National Security Affairs, and chaired by the repre-
sentative of the Secretary of State, to prepare options for specific
courses of action and related action plans for the consideration of the
Senior Review Group and to coordinate implementation of approved
courses of action.
Henry A. Kissinger
378-376/428-S/80023
November 5, 1970December 31, 1972 453
176. Transcript of a Telephone Conversation Between President
Nixon and the Presidents Assistant for National Security
Affairs (Kissinger)
1
Washington, November 9, 1970, 3:40 p.m.
[Omitted here is discussion unrelated to Chile.]
[P:] Anything new on Chile?
K: We have put out directives on Friday.
2
Their propaganda is
stepping up against us but nothing overt.
P: After making the statement he did
3
[omission is in the original]
its as cold as that. Helms has to get to these people. Get out of it now.
K: We have made that clear.
P: Re-scheduling of debts comes up when?
K: Early next year. We have put in the instructions at the NSC
meeting into the directive. I am holding a meeting on Chile in the Sr.
Review Group every 3 weeks.
P: I feel strongly this line is important regarding its effect on the
people of the world. If he can prove he can set up a Marxist anti-
American policy, others will do the same thing.
K: It will have effect even in Europe. Not only Latin
America.
[Omitted here is discussion unrelated to Chile.]
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 365,
Telephone Conversations, Chronological File. No classification marking. All blank
underscores are omissions in the original.
2
Document 175.
3
President Nixon may be referring to Allendes inaugural address, which was fea-
tured in a November 8 New York Times article. (Juan De Onis, Chile: Allende Begins the
March Toward Socialism, New York Times, November 8, 1970, p. E5)
378-376/428-S/80023
454 Foreign Relations, 19691976, Volume XXI
177. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, November 12, 1970.
SUBJECT
Possible Chilean Government Involvement in the International Narcotics and
Counterfeit Currency Traffic
Attached at Tab A
2
is a memorandum sent to you by the Attorney
General containing intelligence information indicating possible in-
volvement in the international narcotics and counterfeit currency
traffic on the part of individuals in the Chilean Government, and
perhaps of the Government itself. The reports are circumstantial and
incomplete. On the basis of information received thus far the following
seems certain:
The participation of Chilean citizens in the narcotics and coun-
terfeit currency traffic has increased markedly in the past 18 months to
2 years.
Chilean participation in this traffic has received some assistance
from individuals in the Chilean Governmentthe previous Govern-
ment as well as the present one.
Some of the individuals involved in the narcotics and counterfeit
currency traffic have had contact with President Allende.
What is unclear is the degree to which involvement in the narcotics
and counterfeit currency traffic has occurred as a matter of Chilean
Government policy and to what degree it is a matter of simple corrup-
tion not uncommon in Latin Governments. With respect to Allende, it
is unclear the degree to which he may personally know of this traffic
and be personally involved in it.
Aside from the importance of this subject from the law enforce-
ment and narcotics control viewpoint, hard information on the involve-
ment of the Chilean Government under the present regime and/or of
Allende personally in the narcotics and counterfeit currency traffic is a
potentially powerful political weapon. Hence, steps should be taken to
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; Sensitive; Outside System; No Copies.
Sent for action. A notation at the top of the page indicates the memorandum was sent via
Haig. Haig initialed the memorandum.
2
Attached but not printed is a November 4 memorandum from Director John In-
gersoll of the Bureau of Narcotics and Dangerous Drugs to Mitchell.
378-376/428-S/80023
November 5, 1970December 31, 1972 455
acquire a more thorough knowledge of Chilean involvement in this
traffic.
I recommend that a small Task Force of the principal intelligence
agencies, reporting to you, be formed under the chairmanship of CIA,
and charged with exploring the question of Chilean Government in-
volvement in narcotics and counterfeit currency traffic and/or that of
Allende personally, and with the preparation of a report to be sub-
mitted to you within 30 days.
3
The Task Force might consist of repre-
sentatives from CIA, DIA, FBI and the Bureau of Narcotics and Dan-
gerous Drugs. If the Task Force does come up with some hard
evidence, you will then be in a position to decide how to crank this into
our overall strategy toward the Allende government.
Recommendation
That you discuss this subject with the Attorney General and sug-
gest that a Task Force, as proposed above, be established to give pri-
ority attention to developing more information on this.
4
3
Kissinger crossed out 60 and wrote 30 in the left margin.
4
On November 14, Kissinger initialed the Approve option. At the bottom of the
page he wrote, Of course as I understand it, it was previous govt which was involved.
Get study without written directive. Written directive is too dangerous. Nachmanoff re-
plied in an undated memorandum to Kissinger that he had requested a report from the
CIA and the Bureau of Narcotics and Dangerous Drugs, but had not issued a written di-
rective. (National Archives, Nixon Presidential Materials, NSC Files, Box 774, Country
Files, Latin America, Chile, Vol. II)
378-376/428-S/80023
456 Foreign Relations, 19691976, Volume XXI
178. Record of a Briefing by the Assistant Secretary of State for
Inter-American Affairs (Meyer)
1
Washington, November 13, 1970.
ATTENDEES
State
Mr. U. Alexis Johnson
Mr. Charles A. Meyer
Defense
Mr. G. Warren Nutter
Mr. Armistead I. Selden
Lt. Gen. Donald Bennett
CIA
Mr. Richard Helms
Mr. David H. Blee
Mr. Thomas H. Karamessines
Mr. William Broe
JCS
Lt. Gen. Richard T. Knowles
NSC Staff
Col. Richard Kennedy
Mr. Frank Chapin
Mr. Arnold Nachmanoff
Mrs. Jeanne W. Davis
Mr. Johnson: I heard Charley Meyer describe his experiences in
Chile and I thought they were highly interesting and he should brief
this group while they were still fresh in his mind.
Mr. Meyer: I had two hours with Frei, five hours with the former
Ministers of Finance, Interior and Defense, an hour with Alessandri,
and forty-five minutes with Allende. The Chileans simply do not accu-
rately evaluate the threat to Chile. They believe they will be saved by
the miraculous character of their mystique or by immobilization of the
bureaucracy, or their tradition of democracy. They are convinced that
there is something in the Chilean character which will soften the blow
of Marxism. They have no concept whatsoever of what will happen in a
police state. I told them over and over that they would have to be real-
istic enough to keep their eyes open. Conservatives are convinced that
the Christian Democrats robbed them of 35,000 votes. They insist that
they did not lose the election but that it was stolen from them. The
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box CL108,
Geopolitical File, Chile, 230 Nov. 1970. Secret; Sensitive. This briefing was held at the 40
Committee meeting. See Document 179.
378-376/428-S/80023
November 5, 1970December 31, 1972 457
Christian Democrats do not have the kind of blind hatred, but they
have no respect for the Nationalistas.
Mr. Kissinger: Does anyone believe the Conservatives? Did the CD
steal votes?
Mr. Meyer: No, I dont believe it.
Mr. Broe: No, we dont think so.
Mr. Meyer: The Christian Democrats are completely split. Frei
thinks he was sacrificed by that madman Tomic. Valdez is a pure
self-seeker.
Mr. Kissinger: But wasnt Tomic Freis candidate?
Mr. Meyer: No, he was the partys candidate. Frei had lost control
of the party.
Mr. Kissinger: Does Frei think another Christian Democrat could
have won?
Mr. Meyer: Yes. The Christian Democrats convention opens No-
vember 28 and no one knows who, if anyone, will emerge as the effec-
tive party leader.
Mr. Kissinger: It cant be Frei?
Mr. Meyer: It could be, but Frei recognizes that he will be the fa-
vorite target for everyone. He is prepared to stay and to make some sac-
rifices but he has never said that he would pick up the baton of leader-
ship. Assuming any political opposition is possible, any concept is so
fractured as to be hopeless. After the Christian Democrats get through
their period of self-excoriation and decide who will run the party, it
might be possible. At the moment its a mess. I asked if the two
partiesthe Christian Democrats and the Nationalistascouldnt get
together. The CD felt they could accommodate the rational side of the
Nationalistas, but the far right of the Nationalistas wont do business
with anyone. In other words, I had no feeling of any rock on which we
could build a church.
Mr. Kissinger: Then what happens to our plan that we should
allow time to Allende so as to crystalize an opposition?
Mr. Meyer: We might do that later. But every Chilean or Latin
American that I talked to said that if the US did anything to draw
strong or adverse attention to Allende, the 36% of the popular vote
which he got would be 70% within 24 hours. They all felt this was true
at least within the first 100 days. They all begged us not to put an anti-
US stamp on Allende.
Mr. Kissinger: Why doesnt he force us to, then? Why is he making
it easy for us not to take a strong stand against him?
Mr. Meyer: One problem is that the group around him is not his
choice. Frei analyzes him as a vain man, an astute politician, but not a
378-376/428-S/80023
458 Foreign Relations, 19691976, Volume XXI
profound student of Marxism. Indeed, Frei thinks he has never read
Marx. Allende has been persuaded that he is in constant danger of his
lifehe is almost paranoid. Frei does not believe that Allende can run
the country, but thinks he will try.
Mr. Kissinger: How did he survive 24 years of political life if he is
that vapid?
Mr. Meyer: Remember he was in the Socialist party and there is a
great difference between being a Senator and being Chief Executive.
Frei warned Allende that sooner or later everyone would turn against
him and that his only strength would lie in the Army. Frei told me after
Schneider had died that he was surprised there had not been a putsch. I
think it is the basic abhorrence of Chileans toward fighting other
Chileans. So far as the Cabinet is concerned, no one in Chile knows
much about them. They are all radicals of course, but the sub-Cabinet is
even worse.
Mr. Kissinger: From what you say, we find that Allende is vain,
given to spasmodic actions, more a candidate than an executive. It will
take a back-breaking effort to control the bureaucracy and his min-
isters. Our only hope then seems to lie in their incompetence.
Mr. Johnson: And the possibility that they will begin fighting
among themselves.
Mr. Meyer: It is a problem of gigantic proportions, and no one can
evaluate the outcome. We can only keep our fingers crossed. But ev-
eryone begged that we not push on Allende now.
Mr. Kissinger: A good definition of a miracle is a situation where
there is no rational expectation of something happening and it
happens. I have no feeling of any group or policy likely to challenge Al-
lende. However, we cant prevent a miracle. Why set limits to the grace
of God?
Mr. Selden: Do we have any indications of outside Communist in-
terference in Chile?
Mr. Meyer: They are playing the straight Moscow line.
Mr. Kissinger: In August we were told to lie low so as not to screw
up the Congressional vote. In October we were told to lie low so as not
to screw up the opposition in November. Now we find ourselves with
no opposition.
(The meeting then moved to a meeting of the 40 Committee)
378-376/428-S/80023
November 5, 1970December 31, 1972 459
179. Memorandum for the Record
1
Washington, November 13, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 13 November 1970
PRESENT
Mr. Kissinger, Mr. Nutter, Mr. Johnson, Lt. Gen. Richard T. Knowles and Mr.
Helms
Colonel Richard T. Kennedy, Mr. Thomas Karamessines and Mr. William Broe
were present for all items.
Mr. Charles Meyer and Mr. Arnold Nachmanoff were present for Item 1.
Mr. John Holdridge was present for Item 2.
1. Chile
a. Mr. Meyer briefed the Committee members on his visit to Chile
for President Allendes inauguration and his conversations with Al-
lende, Frei, Osso and numerous other Chileans and Latin Americans.
2
b. Mr. Meyer expressed his conviction that very few Chileans accu-
rately evaluate the Allende threat to Chilethey believe that the
Chilean character will somehow miraculously preclude a Marxist
take-over of the country. Because of Chilean abhorrence of Chileans
fighting Chileans there is little likelihood of an attempt to remove Al-
lende by force. Any concept of a unified political opposition to Allende
at the moment is virtually hopeless. The CDU is so badly split its fac-
tions cannot get together and there is no rock on which to build a solid
political opposition.
c. Mr. Meyer stated that a unanimous view expressed to him by
every Chilean and other Latin American with whom he spoke was that
the U.S. should refrain from taking any hostile action against Allende
for at least the traditional 100-day honeymoon period or Allende
would immediately receive at least double the support he now has
among Chileans. To this, the Chairman observed that it would then ap-
pear advantageous to Allende to take steps designed to provoke a U.S.
reaction against him and thus far he has carefully avoided doing so.
d. Mr. Meyer noted that after a period of about 70 days any sub-
stantial exchanges of foreign funds for escudos will not be possible as
controls will by then be too stringent. The Chairman suggested that
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only. Drafted on November 17. A copy was sent to Mitchell, Packard,
Johnson, Moorer, and Helms.
2
See Document 178.
378-376/428-S/80023
460 Foreign Relations, 19691976, Volume XXI
prompt steps be taken to procure escudos for possible future expendi-
tures in Chile and Mr. Broe responded that such acquisition has
commenced.
e. [5 lines not declassified]
f. The Chairman observed that the scope for covert operations in
Chile does not seem very broad at present but asked that the CIA pro-
duce for consideration at the next meeting a paper offering certain spe-
cific proposals along the lines of the general Covert Annex dated 27 Oc-
tober 1970 to the NSC Options Paper on Chile.
3
[Omitted here is discussion unrelated to Chile.]
Frank M. Chapin
3
Document 166.
180. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, November 16, 1970.
SUBJECT
Post-Inauguration Analysis
Attached at Tab A
2
is a lengthy analysis of the Chilean situation by
Ambassador Korry. He says there is universal agreement in Chile that
the main threat is the degree and pace of Communist control, the Com-
munist Party having made a deliberate policy decision to seek undis-
puted control over the economy despite the risks of such a course. If
this policy should be successful, i.e. if the Communists can manage the
economy without chaotic results, they will be in the drivers seat.
Korry says Communist control of the economy will, even in the
early stages, provide them with tremendous leverage and powerful
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret. Sent for information. Nachmanoff
drafted the memorandum. On a draft of the memorandum that did not contain the last
paragraph, Kissinger wrote, What do I think? Add a comment. Of course, avoid coun-
terproductive hostility but be sure it doesnt turn into mindless accommodation. (Ibid.)
2
Telegram 4735 from Santiago, is Document 36 in Foreign Relations, 19691976, vol.
E16, Documents on Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 461
weapons to prevent the development of organized opposition to them
and the Government.
In response to this situation, Ambassador Korry makes the fol-
lowing policy recommendations:
that we not take actions that will provide a pretext for the quick
radicalization of the Government of Chile;
that we maintain a public posture of restrained coolness and of
encouraging the democratic opposition;
that we seek to hold our military connections and maintain a
deliberately confusing flexibility of case-by-case treatment of other re-
lationships; and
that we reject across-the-board hostility on grounds that it
would not have a determining impact on the economy, while it would
serve to mobilize national sentiment and strengthen the position of the
Allende government.
I agree that we should, of course, avoid unproductive hostility to
the Allende government, but we should be sure our policy does not
slide off into mindless accommodation.
3
3
President Nixon wrote in the right margin of this paragraph, right.
181. Paper Prepared for the Senior Review Group
1
Washington, November 17, 1970.
ChileStatus Report on Implementation of NSDM 93
A. Multilateral
1. OAS and Cuba. The Department of State is urging Latin Amer-
ican governments to make unilateral public statements along the lines
of the U.S. statement of November 13, reaffirming adherence to the
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H49, Senior Review Group, Chile, 11/19/70. Secret; Sensitive.
Meyer sent the paper to the National Security Council, and it was distributed to the
members of the Senior Review Group for consideration at the meeting originally sched-
uled for November 18, but which took place on November 19. Tabs AF described in the
text are attached but not printed.
378-376/428-S/80023
462 Foreign Relations, 19691976, Volume XXI
OAS resolution on Cuba sanctions,
2
and is taking careful soundings on
prospects for constructive statements within the OAS forum. Circular
telegram sent November 15 is at Tab A.
2. Concern over Chile. The Department of State is preparing to pro-
vide to selected Latin American governments overt, and to the extent
feasible, covert information on Chiles links with subversion in other
countries, to document the reasons for our concern over Chile and to
encourage other governments to understand the U.S. posture and to
adopt a similar one.
3. Consultation with key governments, particularly Brazil and Argen-
tina, to coordinate efforts on Chile. The Department of State is preparing
an instruction to selected posts for such consultation and the Ad Hoc
Interagency Working Group on Chile will meet promptly to consider
how to increase efforts to establish and maintain close relations with
friendly military leaders in the hemisphere.
4. IDB Lending to Chile. The Department of State is exploring with
the U.S. Director of IDB and the Department of the Treasury the proce-
dural possibilities for delay or veto of FSO loans to Chile, and will pre-
pare a recommendation for action. See Tab B for discussion.
B. Bilateral
1. Public Position. Recommendation: that approval be given to the
statement at Tab C, to be drawn upon on a contingency basis by senior
USG officials in responding to questions on Chile. The Department of
State has meanwhile given (on November 12) an off-the-record briefing
on Chile to Mr. George Meany and other leaders of the AFLCIO, and
will give on November 17 in New York similar off-the-record briefings
to the staff of the Council for the Americas and to senior officers of Ana-
conda and other companies interested in Chile.
2. Consultations with the Congress. Recommendation: that consider-
ation be given to having high level briefings of key Congressional
leaders on our Chile policy, to insure understanding of our posture,
and with a view to easing present legislative restrictions in economic
and military matters of special interest to Latin American governments,
with which we will be consulting closely on Chile; e.g., soluble coffee
for Brazil; meat for Argentina, and reductions in MAP and FMS availa-
bilities in general. The Department of State will prepare proposals for
carrying out the consultations with the Congress.
2
The Department of State issued a statement on November 13, after Allende an-
nounced Chiles recognition of Cuba, affirming U.S. support of the OAS resolutions iso-
lating Cuba. (U.S. Decries Chiles Recognition of Cuba, Washington Post, November 14,
1970, p. A12)
378-376/428-S/80023
November 5, 1970December 31, 1972 463
3. Military Assistance to Chile. Recommendation: that approval be
given to the proposed telegram to Embassy Santiago at Tab D, in-
structing the Ambassador to begin moves which will have the effect of
forcing a decision from the GOC on continued U.S. military presence.
Discussion of existing and potential requests by the Chilean military
services for the purchase of arms and equipment in the United States is
at Tab E. Note that the Chilean desire to buy three C130s and eleven
F5s would not involve USG decisions on financing. Decision would
be required on export licensing and on accommodating any FMS part
of the sale (i.e. government furnished equipment such as weapons)
within the $75 million area limitation on FMS and grant materiel ar-
ticles for Latin America.
4. Economic Assistance to Chile. The Department of State has issued
classified instructions to withhold until further notice any new commit-
ments of U.S. bilateral assistance to Chile, including AID loans, AID In-
vestment Guarantees, and Eximbank loans and export guarantees. The
Department of State has in preparation recommendations on courses of
action on handling Investment Guarantee problems which may arise
when the GOC begins to nationalize U.S. property.
5. Peace Corps. Recommendation: that the 17 PCVs scheduled to go
to Chile following completion of training on December 12 be held back
until the Allende government has given some authoritative confirma-
tion of the request for them made by the previous government. We
would make clear at the working level that we would not be prepared
to go ahead without such reaffirmation. See Tab F for discussion.
C. Organizational
1. The Ad Hoc Interagency Working Group on Chile has been or-
ganized and has begun its work under the chairmanship of Assistant
Secretary of State for Inter-American Affairs, Charles A. Meyer.
2. The Department of State Country Director for Andean and Pa-
cific Affairs has been permanently assigned full time to Chilean affairs,
and has been provided an additional Associate Director exclusively for
Chile, and has been designated as the central working-level point of
coordination for Chilean matters.
378-376/428-S/80023
464 Foreign Relations, 19691976, Volume XXI
182. Memorandum From Richard T. Kennedy and Arnold
Nachmanoff of the National Security Council Staff to the
Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, November 17, 1970.
SUBJECT
SRG Meeting on Chile, November 18
This will be the first meeting to get our new policy moving. The
NSDM which is the basis for the policy is at Tab.
2
A 40-Committee on
this subject is scheduled to follow the Senior Review Group meeting.
State has prepared a paper (TabState Paper)
3
which outlines
where we stand and some proposed actions. It also raises for decision
(a) public statement, (b) congressional briefings, (c) a proposed mes-
sage dealing with continued US military presence and assistance, and
(d) a proposed position on continuation of Peace Corps.
We recommend that you ask Mr. Meyer (Chairman of the Ad Hoc
Group) to briefly summarize where we are, what has been done and what he
proposes.
We recommend that you then proceed through the agenda of the
meeting covering the following major topics:
1. Diplomatic Steps
2. Economic Measures
3. Military Steps
4. Peace Corps
5. Public and Congressional Posture
Your talking points which follow proceed in this order. You will
want to drive home the following points.
a. We need a fully fleshed-out action program with all of the policy
ramifications considered, and
b. All steps must be cleared through the interagency mechanism
(cables should be cleared by the White House).
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H49, Senior Review Group, Chile, 11/19/70. Top Secret;
Sensitive.
2
Document 175.
3
Document 181. All subsequent references in this memorandum are to Tabs AF of
that paper.
378-376/428-S/80023
November 5, 1970December 31, 1972 465
1. Diplomatic Steps
a. Approaches to the OASThe US in a November 13 statement reaf-
firmed adherence to the OAS Resolution on Cuba sanctions. Chile has
reestablished relations with Cuba and is exchanging representation.
State proposes to take careful soundings on prospects for constructive
statements within the OAS forum and is urging Latin American gov-
ernments to make unilateral public statements along the lines of our
own.
4
Have any specific steps been taken or are they planned? With
which governments? What has been the reaction of the Latin American
governments?
Who are we approaching with what kind of statements (State
has sent a cable to all Latin American PostsTab A)? What do we ex-
pect them to say or do in the OAS? What are the prospects for any kind
of resolution? Do we want one?
Specifically what do we propose to say in the OAS? Should we
take the lead?
(We need to get specific on these points. We need also to have a
clear definition of precisely what we are trying to achieve. Generalized
approaches are not likely to produce the kinds of specific results we
want.)
b. Spreading the word about ChileState is proposing to provide se-
lected Latin American Governments information on Chiles links with
subversion in other countries and to encourage them to adopt a posture
similar to ours.
5
To whom is the information being provided, and what do we ex-
pect them to do with it?
c. Consultations with Key Governments, particularly Argentina and
Brazil to coordinate efforts on ChileState is preparing an instruction for
such consultations and the Ad Hoc Working Group plans to meet
promptly to consider how to increase efforts to maintain relations with
friendly military leaders.
What specifically do we plan to tell the Brazilians and Argen-
tines, and what do we expect them to do? When will the instruction be
ready?
What specific steps will the Ad Hoc Group consider to increase
ties with the military? Could we have a detailed report in two weeks?
(Ask Adm. Moorer for his views.)
4
In the right margin of this paragraph, Kissinger wrote, Chile + the OAS. Strat-
egy. In the left margin he wrote, Ambassadors?
5
Kissinger wrote, Which?, in the left margin of this paragraph.
378-376/428-S/80023
466 Foreign Relations, 19691976, Volume XXI
Is the military in Brazil and Argentina, for example, likely to
want toor be able toinfluence the Chilean military in any signifi-
cant way? (You may wish to ask for a detailed report on these diplo-
matic efforts within two weeks.)
2. Economic Steps
a. IDB lending to Chile2 Loans for Chile are awaiting action by the
IDB Board of Directorsa total of $11.6 million for two universities, an-
other $8.6 million loan for agriculture research and extension may be
ready during December. State is exploring procedural possibilities for
delay or veto of the loans, and will prepare a recommendation for ac-
tion. In the interim, the Executive Director will take the position that he
is uninstructed and, therefore, effectively block action on the loans.
(State Paper Tab B)
What steps are we taking to coordinate our tactics with other
friendly Latin countries in order to reduce our unilateral visibility?
You want to emphasize that no new loans are to be approved; if
there is any question about a specific case, it should be brought back to
the SRG.
What steps are being taken to limit Chiles access to credits from
other international financial institutions?
b. Economic Assistance to ChileState has issued instructions to
withhold new commitments of AID loans, investment guarantees, and
Ex-Im Bank loans and guarantees. State is preparing recommendations
on how to handle investment guarantee problems when the GOC
begins to nationalize US property.
What is being done to determine how we can defer or cut off ex-
isting commitments if that becomes necessary?
What provisions of law are applicable if Chile resumes trade
with Cuba, or establishes trade with North Korea (as they recently an-
nounced they would)? At what point do these provisions become
applicable?
When can we have States recommendations on how the U.S.
Government should react to the first incidents of Chilean nationaliza-
tion of U.S. property?
6
State has briefed the AFLCIO and the staff of the Council of the
Americas and several companies interested in Chile on an off-the-
record basis.
6
Kissinger wrote, Nationalization strategy, in the upper margin of this
paragraph.
378-376/428-S/80023
November 5, 1970December 31, 1972 467
What specifically has been said in the briefings to labor and
business leaders? What have we suggested that they do about Chile, if
anything?
What are States plans for systematically briefing American
business on the situation in Chile and our approach? Is the Commerce
Department involved?
7
3. Military Steps
a. Military Presence
Our small military mission (approximately 17 men) is still in
Chile. It offers a means of continued close contact with the Chilean mili-
tary and we will want to keep it there for this purpose as long as we
can. But it is there under the Mutual Defense Assistance Agreement of
1952 and a Military Mission Agreement of 1964. The Chilean Defense
Minister has stated that the Government of Chile will study all military
agreements and the decision as to whether the US mission remains is a
decision for the two governments. The question is whether we should force
the issue of a reaffirmation of those agreements by the Allende government.
We may have much to gain by the continued contact with the Chilean
military. If we force their hand now, we might cause a break. On the
other hand if we push the Chilean military to press for continuance, the
chance of success might increase and, if Allende refuses, the discontent
of the military might increase. State has a proposed cable at Tab D
State Paper. It would have the military go in and raise the question now.
(We recommend you not clear the cable at the meeting.)
Do we gain more by pushing this issue ourselves or by waiting
for the Allende government to raise it with us?
The Service Chiefs seemto want us to stay. Will we make it more
difficult for them to maneuver if we give them what seems to be a de-
mand for an early final decision?
Should this be handled by our military with the Chilean military
or by Korry with the Minister of Defense or Allende (whatever is done
we believe should be done initially at least by the military).
8
b. Military Assistance (Tab EState Paper)
There are twenty M41 light tanks funded under a Credit Sale in
FY69 which have been overhauled and are ready for shipment to Chile.
The Chileans also have expressed interest in purchasing three C47 air-
craft, three C130s and eleven F5s on a commercial basis. The C130s
and F5s would not involve any USG financing but would require deci-
7
Kissinger made checkmarks in the right margin of these two paragraphs. In the
lower margin, he wrote, What are we doing re pvt business meetings?
8
Kissinger wrote, Can we make (a) depend upon (b), in the left margin of this
section.
378-376/428-S/80023
468 Foreign Relations, 19691976, Volume XXI
sions on export licenses. If we are responsive we would strengthen our
hand with the Chilean military, increase Chiles dependence on US
spares and replacements, and preempt Communist suppliers with this
type of equipment; but we would also strengthen Allendes forces and
perhaps confuse some of our Latin American friends and generate
pressures for more military assistance from others. If we are unresponsive
we would disassociate ourselves from strengthening Allendes forces
and avoid the disadvantages of confusing our friends or generating de-
mands for assistance from them, but we would alienate Chile military,
reduce our influence with them, and perhaps turn them to Communist
sources of supply.
What should we do about the tanks? How long can we hold up
this delivery?
Will the aircraft sales be possible without credit assistance (al-
legedly the Chileans will not require new USG financing but they may
require some sort of financing assistance from the supplierswould
we be willing to encourage or permit this?)
Can we sell the aircraft and not deliver the tanks?
What will the real effect be on our Latin American friends? Can
we explain this to them?
Can we deal with the question of continued deliveries of these
proposed sales without having first resolved where we stand with re-
spect to the military assistance agreements?
4. Peace Corps (Tab FState Paper)
We have 17 Peace Corps volunteers who will complete training
in the U.S. on December 12 and then are scheduled to go to Chile. There
are 92 volunteers now in Chile who will complete their tours between
now and the end of 1971. The question is whether we should send the new
volunteers either when they are ready in December or at some later time or not
send them at all. If we hold off until we get Allendes confirmation of the
request for them, which his predecessor gave us, we leave the initiative
to Chile. This would put the onus for whatever decision is finally
reached on Allende but could result in a growing press campaign with
a highly emotional content. If we decide now not to send them we would
probably face early termination of the entire program and lose the op-
portunity for continuing contact in Chile; we would be open to the
charge that we were taking punitive action and seeking to worsen
relations.
Is there any real hope that the program will continue?
Do we want to keep the Peace Corps in Chile?
Will our actions on the 17 new volunteers have any important
bearing on the 92 now in Chile?
Can we afford to hold off and if so for how long?
378-376/428-S/80023
November 5, 1970December 31, 1972 469
5. Public Position
State asked for approval of a statement (which is at Tab C of the
State paper) which could be drawn upon to answer questions on Chile.
DOD has proposed some alternative language.
What is it we want to get acrossor avoidin a public statement?
While something undoubtedly will have to be said before long,
it is probably desirable to say the least amount necessary.
I suggest that we say something along the following lines:
The new President has taken office in accordance with Chilean
constitutional procedures. We have no wish to prejudge the future of
our relations with Chile but naturally they will depend on the actions
which the Chilean Government may take toward the United States and
the inter-American system. We will be watching the situation carefully
and be in close consultation with other members of the OAS.
9
6. Consultations with CongressState recommends high level brief-
ings of key Congressional leaders on our Chile policy.
What do we want to accomplish by Congressional consulta-
tions? Who should we talk to? How much can we tell them? Who
should do the briefings?
10
We need a well-thought out assessment of the pros and cons of
Congressional consultations, and a detailed strategy proposal.
9
Kissinger made a checkmark in the left margin of this paragraph.
10
Kissinger made a checkmark in the left margin of this paragraph.
378-376/428-S/80023
470 Foreign Relations, 19691976, Volume XXI
183. Minutes of a Meeting of the Senior Review Group
1
Washington, November 19, 1970, 4:045:53 p.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger CIA
Lt. Gen. Robert E. Cushman
State
Mr. William Broe
Mr. John Irwin
Mr. Thomas Karamessines
Mr. U. Alexis Johnson
Mr. Charles A. Meyer JCS
Adm. Thomas H. Moorer
Defense
B/Gen. Joseph Belser
Mr. David Packard
Mr. G. Warren Nutter NSC Staff
Mr. Armistead I. Selden Mr. Arnold Nachmanoff
B/Gen. Robert C. McAlister Col. Richard T. Kennedy
Mr. D. Keith Guthrie
Justice
Atty. Gen. John Mitchell
SUMMARY OF CONCLUSIONS
1. Bilateral Consultations. The United States will advise other OAS
Governments that it considers Chilean recognition of Cuba unwar-
ranted and will seek to discourage them from following the Chilean
lead. The Ad Hoc Group will prepare a factual rationale to support this
US position, which should be conveyed to the OAS Governments
through both Embassy and military channels. The rationale should also
lay the basis for future opposition to Chile in the OAS. It was agreed
that the US approach should be varied as appropriate with each of the
Latin American governments. It was also agreed that all messages
would be cleared with the White House.
2. OAS Strategy. The Ad Hoc Working Group will prepare a study
of US strategy on Chilean participation in the OAS. The study should
be submitted for the next SRG meeting on Chile.
3. Inter-American Defense Board (IADB). The Defense Department
will review the security implications of Chilean participation in the
IADB and will bring any potential problems to the attention of the SRG.
1
Source: National Archives, Nixon Presidential Materials, NSC Institutional Files
(H-Files), Box H111, SRG Minutes Originals, 1970. Top Secret; Sensitive. The meeting
was held in the White House Situation Room. All brackets are in the original. The deci-
sions made at the meeting were circulated to the members of the Senior Review Group in
a November 27 memorandum from Kissinger. (Ibid., Box H49, Senior Review Group,
Chile, 11/19/70)
378-376/428-S/80023
November 5, 1970December 31, 1972 471
4. Military Mission. The United States will not take the initiative in
raising the status of the US Military Mission with the Chilean Govern-
ment but will continue to maintain the Mission on the current basis
pending a specific request from the Chilean government for reduction
or discontinuance.
5. Military Sales. The United States will delay a decision on whether
to go forward with delivery of M41 tanks already contracted for by the
Chilean Government and will also defer action on export licenses for
commercial purchase of C130 and F5 aircraft for the Chilean Air
Force. The subject is to be reviewed at the next SRG meeting on Chile.
6. IDB Loans. The United States will continue seeking to delay ac-
tion on Chilean loan applications pending before the Inter-American
Development Bank (IDB). White House approval must be obtained be-
fore the US representative on the IDB Board agrees to approval of any
loan to Chile.
7. IBRD Loans. The State Department will undertake working-level
consultations with the IBRD with a view to enlisting IBRD cooperation
in restricting loans to Chile.
8. Export-Import Bank. The State Department will consult with the
Export-Import Bank about discontinuing all new credits and guar-
antees for Chile. If possible, such action is to be justified on the basis of
banking risk alone.
9. Public Statement. The SRG approved the text of a public state-
ment on Chile to be used by US officials on an if-asked basis.
10. Congressional Consultations. The SRG agreed that efforts to gen-
erate Congressional support for Administration policy on Chile should
be focused on the new Congress which is to convene in January 1971.
The subject is to be reviewed at the next SRG meeting on Chile.
11. Peace Corps Volunteers. The United States will seek confirmation
of the Chilean Governments approval prior to proceeding with assign-
ment to Chile of the seventeen Peace Corps volunteers currently in
training.
12. Ad Hoc Working Group. A JCS representative will be added to
the Ad Hoc Working Group on Chile established under NSDM 93.
13. Chilean Trade with Communist Countries. The SRG at its next
meeting on Chile will review policy options for application of provi-
sions of US law that may relate to Chiles establishment of trade with
Cuba, North Korea, and North Vietnam.
14. Expropriation. The SRG at its next meeting on Chile will con-
sider policy options for the US Government in the event that the
Chilean Government nationalizes US-owned firms.
Dr. Kissinger: We have two related subjects to discuss. First, we
will try to outline the basic elements involved in implementation of
378-376/428-S/80023
472 Foreign Relations, 19691976, Volume XXI
NSDM 93. Then, in a more restricted session, we can discuss the 40
Committee aspects.
2
We have a State Department paper that outlines various diplo-
matic steps we might take. Why dont I run through these?
The first one has to do with approaches to the OAS. This was spe-
cifically triggered by Chilean restoration of relations with Cuba in vio-
lation of an OAS Resolution and by the lukewarm response of the Latin
American states to our overtures on the matter.
There are two issues: how we handle the Cuba question and, more
fundamentally, how we deal with Chile in the OAS. The other day I
had lunch with three Latin American ambassadors at their request.
3
Precision of thought was not an outstanding attribute of those gen-
tlemen. They seemed totally baffled about how to deal with Chile in the
OAS. At the same time, they didnt see how the OAS could function if
the Chilean involvement in the OAS develops in the way they fear. I
want to discuss both issues.
Mr. Meyer: With regard to the first, we should be prepared for an
approach at the foreign minister level within the OAS to reconsider
Cubas exclusion under the resolution of the Ninth Meeting of Foreign
Ministers.
4
Carrillo Flores of Mexico spoke approvingly in public re-
cently about Chilean recognition. The Colombian Foreign Minister has
said he wants to bring the Cuba question to a Meeting of Foreign Min-
isters. He has said the OAS position should be changed if there is a
change in Cubas own position on exportation of revolution. We need
to get together with CIA to see if there is any information we could
share with the Latin Americans that would serve to counter the
Oh-Cuba-is-all-right attitude.
Dr. Kissinger: This raises two problems. Is there nothing we can do
to get a tougher Latin American response to Chile? And is there some-
thing we can do to prevent the Chilean action from having worse
consequences?
Mr. Packard: If we dont take some action, we will find ourselves
in a worse position. We could provide some leadership to get the other
Latin American countries not to accept Cuba and perhaps to move
against Chile. In addition to the help CIAcan provide, we might be able
to do something through our military contacts all over Latin America.
2
See Document 184.
3
On November 17, Kissinger lunched with the Ambassadors of Argentina, Brazil,
and Uruguay at the Argentine Ambassadors residence. See Foreign Relations, 19691976,
vol. E10, Documents on the American Republics, 19691972, Document 31.
4
In January 1962, the Meeting of Consultation of OAS Foreign Ministers in Punta
del Este, Uruguay, agreed to exclude Cuba from the OAS. The Ninth Meeting of Consul-
tation of Foreign Ministers, held in July 1964 in Washington, imposed sanctions on Cuba.
378-376/428-S/80023
November 5, 1970December 31, 1972 473
We should move as quickly as possible. If we let things drift, we will
wind up with everyone recognizing Cuba, and we will be left alone. I
think we can bring the other Latin American countries along.
Dr. Kissinger: Should we make clear that we oppose Chilean rec-
ognition of Cuba on its own merits? Or because it is a violation of an
OAS resolution?
Mr. Packard: We ought to do both. The two aspects are linked to-
gether. The merits of the issue are required to support the OAS position
[on Cuban exclusion and non-recognition].
Mr. Irwin: I agree with both Charlie [Meyer] and Dave [Packard].
It is no use bringing up the issue in the OAS or with other Latin Amer-
ican countries unless we can provide some information [about the
dangers of Cuba] on background. As Charlie said, the other countries
may raise the question of Cuban recognition in the OAS.
Dr. Kissinger: Nobody thinks we should go on the offensive
against Chile? (to Meyer) What you are talking about is a tactic to pre-
vent the Chilean recognition fromhaving a multiplier effect in the OAS.
Mr. Irwin: We sent a cable on Chilean recognition of Cuba but got
very lukewarm replies from the Latin Americans.
Mr. Packard: What we need is personal contact, not just a cable.
Mr. Meyer: There was contact. The Ambassadors saw the Foreign
Ministers.
Mr. Packard: We need to give them some ammunition to use in
presenting our position.
Mr. Meyer: I dont believe it is very profitable to attack the Chilean
position on recognition. The OAS has been a little bit pregnant ever
since 1964. Mexico never broke relations with Cuba; Jamaica was ad-
mitted to the OAS even though it had consular relations with Cuba;
and Chile voted against the resolution, although it did comply by
breaking relations.
Mr. Selden: That is right. Something worth remembering is that it
took a two-thirds vote to adopt the resolution and that a two-thirds
vote is required to repeal it. That puts us in a strong position.
Dr. Kissinger: (to Meyer) Do you think we are not on strong
ground if we seek to attack Chile in the OAS?
Mr. Meyer: Thats right, because there is no penalty for failing to
carry out an OAS resolution.
Dr. Kissinger: The other day these three Latin American ambas-
sadors talked on all sides of the question. I could quote you remarks to
support any position. But, looking at just one aspect of their remarks,
howdo you interpret their expressions of concern about Chilean partic-
ipation in the OAS?
378-376/428-S/80023
474 Foreign Relations, 19691976, Volume XXI
Mr. Meyer: I am sure the three Ambassadors are sincere in being
willing to fight the issue to the last North American.
Dr. Kissinger: They would not support us if we raised the issue of
Chile?
Mr. Meyer: Thats right. In the case of either Chile or Cuba, any-
thing we do in the way of consulting within the Hemisphere has to be
backed up by factual information. It cannot be just hortatory.
Dr. Kissinger: But the information we make available would be in
the context of persuading them not to follow Chiles lead rather than of
convincing them that the Chilean action in recognizing Cuba was
unjustified.
Mr. Meyer: Yes.
Dr. Kissinger: (to Cushman) What do you think?
Lt. Gen. Cushman: I think we can work on both objectives to-
gether. We can give information about support for guerrilla activities,
and this will lead other countries to take a strong stand against both
Cuba and Chile.
Mr. Packard: If the Latin Americans know what we think about the
situation, their own views may be strengthened.
Mr. Meyer: The Cuba question in the OAS requires us to go to
work right away. The issue of Chile has a longer fuse.
Dr. Kissinger: Then the consensus is that we go back to the Latin
American governments with the argument that Chilean recognition of
Cuba is not warranted because of various facts which we will cite. We
also say that the Chilean example should not be followed by other gov-
ernments. All of this can be used as a platform for eventual condemna-
tion of Chile. Do we all agree? Then lets get a cable prepared.
Mr. Irwin: We would plan to operate not only through Embassy
but also military channels?
Dr. Kissinger: Yes.
Mr. Meyer: It is interesting to note that General Martinez of Argen-
tina was originally very strong about having Chile thrown out of the
Inter-American Defense Board. Then after Allende took office he
changed his position, apparently after consulting with General
Lanusse.
Dr. Kissinger: Will we employ a differential approach in passing
information to the Latin Americans? I assume, for example, we would
not want to give as much information to Figueres as to some others.
Mr. Meyer: We will have to do it that way.
Mr. Nutter: We have to develop the line that the Cuban danger is
magnified by the CubaChile axis. (to Irwin and Meyer) Perhaps you
would not want to play this strongly right now.
378-376/428-S/80023
November 5, 1970December 31, 1972 475
Dr. Kissinger: Yes, we want to emphasize that now.
Mr. Meyer: Thats right.
Mr. Karamessines: We have been laying the foundation by passing
information through intelligence contacts.
Dr. Kissinger: We are clear about the general strategy. The details
can be worked out in the Ad Hoc Group.
What about the general issue of Chile and the OAS?
Mr. Meyer: This is part of the slower process. We have to convince
the Latins. We have to make them see what Chile isand not what they
hope it is. For years the OAS has been saying that a Marxist-Leninist re-
gime is incompatible with the Inter-American system. The Latins dont
want to face this. They say, We have known Allende for years.
Dr. Kissinger: If they know him, they ought to be concerned.
Mr. Meyer: Yes, but logic doesnt play much of a role here. We
have to play Chile with a longer fuse. We should let Chile build the case
against itself and keep reminding the OAS what is happening. We
should inform them if Chile is harboring revolutionaries and link one
fact with another. We should not let their wishful thinking color their
outlook. I dont think nowis the time to make an issue of Chiles contin-
uance in the OAS.
Mr. Packard: I agree. You have to build your case.
Dr. Kissinger: What about the question of the IADB [Inter-
American Defense Board]? Does this involve classified information?
Adm. Moorer: Not particularly. I think most of what they deal
with is at the confidential level. They do not do too much. To my
knowledge, they have only been active during the Dominican Republic
incident. They dont get into very deep subjects. The IADB is princi-
pally a way of increasing our contact with the Latin American military.
Mr. Meyer: The IADB is related to the problem of what sort of links
we maintain with the Chilean military.
Dr. Kissinger: It would be useful if Dave [Packard] and Tom
[Moorer] could review what the Chilean military representative will
learn from being on the IADB and could check into the classified infor-
mation problem if there is one. If special measures should be adopted,
these should be brought to our attention.
Mr. Packard: I believe the problem can be handled. The subject
matter in each case will determine what we should do.
B/Gen. Belser: The IADB found it necessary to exclude Cuba.
Dr. Kissinger: (to Meyer) It would be helpful if your group could
prepare for our next meeting (in two or three weeks) a paper on the
strategy we should follow in the OAS.
378-376/428-S/80023
476 Foreign Relations, 19691976, Volume XXI
Mr. Meyer: This also relates to the IADB and to the Inter-American
Defense College, both of which are OAS organs.
Adm. Moorer: One of the objectives of the Ad Hoc Group is to
maintain close relations with friendly military leaders in Latin
America; yet, there is no JCS representative on the Group. I think the
JCS should have a representative and would like to propose General
Richard Shaefer as the JCS member.
Dr. Kissinger: I agree. Does anyone have any objection?
Mr. Meyer: I dont. Armie Selden brought this up at the last
meeting of the Group.
Dr. Kissinger: Then I see no problem.
Mr. Irwin: What about giving Charlie [Meyer] the authority to call
in USIA where appropriate in connection with the Ad Hoc Groups
work? I think this is important. USIA can have a big impact.
Dr. Kissinger: I agree.
We have taken care of the questions of spreading the word about
Chile and consulting with key Latin American governments. Now lets
discuss military steps. There are two related issues: our military mis-
sion and whether or not to raise its status with the Chilean government,
and military assistance. The Chileans are awaiting delivery of some
M41 tanks we are providing under a credit sale, and they also want to
purchase on a commercial basis C47, C130, and F5 aircraft.
With regard to the military mission, the argument in favor of
raising its status with the Chilean Government is that the Chilean mili-
tary want to retain the Mission and if Allende refuses, it will create
strain between him and the armed forces. Or if Allende is reluctant to
create such strain, he will agree to continuing the Mission and will thus
get locked in. The argument against is that access to the Chilean mili-
tary, which is the only significant institution with an independent com-
mand system, is one of our greatest assets and that by raising the issue
of the Missions status, we run the risk of triggering a negative response
from Allende. As I understand, State leans toward raising the matter.
Mr. Irwin: I think that if Allende is disposed to get rid of the Mis-
sion, it will be only a question of time until he does so. There is, how-
ever, a risk of precipitating a break.
Adm. Moorer: The Chilean military are constitutionalists; they are
very conservative. We have close relations with them; I know several of
them myself. They have participated in the UNITAS exercises.
5
5
The annual U.S. Navy Unitas exercise involved a tour of South America and joint
exercises with national navies.
378-376/428-S/80023
November 5, 1970December 31, 1972 477
Dr. Kissinger: Are you in favor of asking whether our Mission
should continue? Or should we simply assume that it is to be
maintained?
Mr. Packard: I think we should do the latter. That way it is more
likely we will be able to stay longer.
Dr. Kissinger: Suppose that in our judgment Allende wants to get
rid of the Mission but doesnt feel strong enough to do so now. If we get
him to say that he wants the Mission continued, will we thereby pro-
long the Missions likely tenure beyond the point when he becomes
strong enough to ask for its removal?
Mr. Irwin: I dont think what he says now will have any effect on
what he does later.
Mr. Nachmanoff: There is one other consideration. We may be
more vulnerable to charges of engaging in improper activities, if we are
operating the Mission without affirmation from Allende that he desires
it to continue.
Adm. Moorer: Raising the matter will force Allende to take action.
Mr. Meyer: If we go to the military and tell them to prod the boss
and he says no, we will thereby have crystallized the separation be-
tween Allende and the military.
Mr. Selden: There is a double issue. Is it possible for us to continue
MAP without continuing the MAAG?
Mr. Packard: But taking the initiative in going to Allende will raise
this issue.
Dr. Kissinger: My smell says that he will get rid of the Mission as
soon as he feels strong enough. Whenever he does it, it will be an-
noying to the military.
Adm. Moorer: He could waffle his answer to the military.
Mr. Nutter: Perhaps there may be some political problems in this
country if we continue military assistance after he has ousted the Mili-
tary Mission.
Dr. Kissinger: The thing that impresses me is that the Mission gives
us a channel of communication and some normal means of contact with
the one element in Chile that has the best chance to move against
Allende.
Mr. Packard: And it also gives us an opportunity to get across to
the military the impression that we might support them if they moved
against Allende.
Dr. Kissinger: I understand Charlies [Meyers] point that taking
the initiative to raise the issue might force a break between Allende and
the military. I also think Tom [Moorer] has a point in suggesting that
Allende might give them a waffly answer.
378-376/428-S/80023
478 Foreign Relations, 19691976, Volume XXI
B/Gen. Belser: This would be a two-part approach. We would first
go to the military and then to the civilian government leadership.
Dr. Kissinger: Is it possible to approach the military on this?
Mr. Packard: The question is whose answer do you accept?
Dr. Kissinger: Lets go around the table on this.
Mr. Irwin: I lean toward trying to clarify the matter by going
through the military. But I dont feel strongly about it.
Adm. Moorer: I agree with Dave [Packard]. It will be difficult to
get a definite answer from the military.
Lt. Gen. Cushman: If we approach the military, the word will get
to the civilian leadership. This will give them options that would not
otherwise be available to them.
Mr. Meyer: I should point out that this question would not have
come up if the Minister of Defense had not stated that all military
agreements will be reviewed and that continuation of the US Military
Mission depends on the agreement of both governments. At the mo-
ment our Embassy has instructions not to talk to Allende about
anything.
Dr. Kissinger: Couldnt we just say that we are operating on the as-
sumption that the Mission will continue?
Mr. Meyer: That is what we were planning to say.
Dr. Kissinger: Cant we follow past practice?
Mr. Packard: That has been to assume that the Mission is to
continue.
Dr. Kissinger: Cant we handle this by planting a question in a
press conference?
Mr. Irwin: In that case I am inclined to do nothing.
Mr. Packard: I agree.
Mr. Irwin: (to Meyer) Has the issue [of the Missions status] come
up [between us and the Chilean Government]?
Mr. Meyer: Only that the Defense Minister said on November 10
that the Government would be reviewing all military agreements. We
can just wait until they start their review.
Dr. Kissinger: That would be my inclination.
Mr. Packard: I agree.
Dr. Kissinger: If we raise the matter, they will kick us out or will
waffle. Should I raise this with the President?
Mr. Packard: No, it is not worth bothering him.
Dr. Kissinger: Then we will continue to operate the Mission. Now
for the question of military assistance.
378-376/428-S/80023
November 5, 1970December 31, 1972 479
Mr. Packard: I think we should act as though we plan to continue.
We should not stop MAP.
Dr. Kissinger: What about the new stuff?
Mr. Selden: The tanks have already been contracted for. They are
stored down in Anniston, Alabama.
B/Gen. Belser: The Chileans have been told that the tanks will be
ready for shipment on December 31. They are not aware that they are
ready now.
Mr. Packard: Lets hold off on this as long as we can.
Mr. Irwin: I hate to go ahead or, at this point in time, to break off
the deal. It would be better to delay.
Mr. Packard: We can continue with other things such as spare
parts.
Adm. Moorer: Anything we want to sell, they will buy.
Mr. Selden: They want to buy F5s.
Adm. Moorer: The sales help to maintain contact with the military.
If we dont sell to them, they will get what they want elsewhere.
Dr. Kissinger: What we do depends on their policy. If Cuba
wanted to buy military equipment, what would we do? Have the
Chileans made a formal request for F5s and C130s?
B/Gen. Belser: Only to the company representatives in Santiago.
Mr. Packard: This sort of thing takes time. We will need to review
these requests.
B/Gen. Belser: These are new requests. The Chileans have $86 mil-
lion available which they want to spend.
Dr. Kissinger: Then we think that after December 31 we might give
them the M41 tanks they have already paid for unless they do some-
thing outrageous in the interim. We should wait on the other requests
until they become more real. That is, if we wont have to start talking
with the companies.
Mr. Irwin: (to Meyer) Do you have to go back to the companies?
Mr. Meyer: Lockheed has been in touch about export licenses.
Mr. Nachmanoff: The new Air Force Chief of Staff talked to our
Military Mission.
B/Gen. Belser: The C130s are an old request; the interest in F5s is
post-Allende.
Mr. Packard: If they get these aircraft, they will be dependent on us
for spare parts.
Adm. Moorer: Thats just the point.
Mr. Meyer: Selling to the Chileans will raise the question of what
we are going to do for our friends.
378-376/428-S/80023
480 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger: Will they do without the planes if we refuse to sell to
them?
Adm. Moorer: They have tried everywhere else.
Dr. Kissinger: The question is whether we gain additional leverage
by selling the planes. We cant avoid the question of the reaction of our
friends.
Mr. Irwin: Selling does give extra leverage. They will need to get
spare parts from us. The key issue is the effect on surrounding coun-
tries. We tell them how bad Allende is; and as a New Years present, we
sell him planes we have refused to sell to the others.
Dr. Kissinger and Mr. Packard: That is a strong point.
Mr. Irwin: We also need to consider the internal reaction here both
with the public and on the Hill.
Mr. Packard: That indicates that we should drag our feet.
Dr. Kissinger: I agree with that.
Mr. Packard: We should just follow our normal pace.
Dr. Kissinger: (to Kennedy) Put this on the agenda for succeeding
meetings so that we can review where we stand.
Mr. Meyer: Then the instructions to the Embassy are that it is to be
business as usual as far as military relations are concerned.
Dr. Kissinger: Lets turn to economic steps. There are two loans for
Chilean universities before the IDB Board. We have been delaying ac-
tion on them. I dont know exactly where we go from here. My impres-
sion of the Presidents views is that we are under instructions to see
that no new loans are approved to the extent possible.
Mr. Irwin: If that is taken literally, it means no loans. If we dont
take it literally, it could mean no loans to the extent desirable.
(Attorney General Mitchell and Under Secretary Johnson joined
the meeting at this point.)
Dr. Kissinger: I am sure that to the extent desirable was not the
meaning intended. The directive means to make no new loans unless
there are overwhelming reasons to do so. The burden of proof is on
those who are proposing the loan. Even that interpretation may be
stretching the meaning beyond what the President intends. Where does
this leave us on the two loans?
Mr. Meyer: Felipe Herrera has said they will not come up until the
end of the year.
Mr. Irwin: I would like to leave this for as long as possible. There is
no overwhelming reason to approve the loans. On the other hand, this
would be our first overt move hostile to Allende. The loans were previ-
ously set. If we back off now, the presumed reason for such a decision
must be the Allende government. Such a step could, of course, serve to
378-376/428-S/80023
November 5, 1970December 31, 1972 481
carry out the Presidents decision that we should clearly signal our atti-
tude toward Allende to other countries. It is doubtful to what degree he
could make a case of these loans; they do not amount to much money.
Dr. Kissinger: If it gives him the rub, he must never be able to make
a case against us.
Mr. Irwin: The question is do we move against him in relatively
small increments or do we do something substantial?
Dr. Kissinger: If we dont do something significant somewhere
along the line, we will be lending support to his line that there is no
penalty for going against the United States.
Mr. Irwin: I think he will eventually show his true stripes.
Dr. Kissinger: Let us leave it that no loans are to be approved
without coming back to this group.
Mr. Irwin: (to Meyer) Then you should press for further delay [on
the loans].
Mr. Meyer: There are two other institutions involved. The World
Bank has in the hopper several hundred million dollars worth of
projects. None of them are coming up immediately except one for $25
million for Santa Gertrudis cattle. This one was deferred during the
election period. It has already been favorably recommended to the
Board and should be coming up within the next few weeks. There is
also a $50 million loan for electric power that will be coming up early
next year.
Dr. Kissinger: Do we have any means to block them?
Mr. Meyer: No.
Dr. Kissinger: Then how would we stop them?
Mr. Selden: With some help from others.
Mr. Meyer: Perhaps Bob McNamara might be able to exert some
influence.
Dr. Kissinger: My sense is that the President really means for us to
try to cut off economic assistance to Chile.
Mr. Mitchell: How does the Bank vote? By stock interest?
Mr. Meyer: Yes, by stock interest.
Dr. Kissinger: I wonder whether McNamara would be disposed to
cooperate. Probably he would not.
Mr. Irwin: Someone ought to talk to him.
Dr. Kissinger: Let me explore it with McNamara.
Mr. Meyer: Let us explore it first at the working level.
Dr. Kissinger: I would prefer thaton the assumption that nothing
happens in the meantime.
Mr. Irwin: I would rather go ahead on the University loans but not
on the economic loans.
378-376/428-S/80023
482 Foreign Relations, 19691976, Volume XXI
Mr. Selden: Is either of these universities the one that Felipe
Herrera is going to be rector of?
Mr. Meyer: I agree with Jack [Irwin] that the two university loans
are less important.
Dr. Kissinger: (to Meyer) You explore it at the lower level. I am not
sure what McNamaras reaction would be on this.
Mr. Irwin: I had lunch with him the other day, and we had a gen-
eral discussion about loans to countries that expropriate without
compensation.
Dr. Kissinger: I see him from time to time. I will not raise this with
him till I hear from Charlie [Meyer].
Mr. Meyer: The Export-Import Bank can place Chile in Category D.
Normally there would be $2 million per month in credits going to
Chile. If there were no Export-Import Bank loans or guarantees at all,
we would give the biggest signal to Chile. Export-Import Bank action
would cover the entire commercial banking network in the United
States. It is easy to tell Henry Kearns to get the word out.
Mr. Packard: That is a good signal. It is clear as a bell.
Mr. Johnson: It is pretty dramatic. Will this cut off most commer-
cial exports to Chile?
Mr. Meyer: Yes.
Mr. Irwin: It is a very clear signal. I am uncertain about the impact.
It will cut off a lot of commercial retailers here. There could be a polit-
ical problem here.
Dr. Kissinger: As I understood Ambassador Korry when he was
here, one of his principal arguments was that between now and next
March we ought to maximize economic pressures on Allende. What
does Category D cut off that isnt covered under Category C?
Mr. Meyer: Going from C to D means that the Board has to review
each of the applications for Chile.
Mr. Irwin: On this we have got to make a decision quickly.
Mr. Johnson: Putting aside all political considerations, isnt this
really primarily a banking question?
Mr. Meyer: Yes.
Mr. Irwin: If we do it that way, there would be no problem.
Dr. Kissinger: Do you want to do that?
Mr. Meyer: I think so.
Dr. Kissinger: Then we can assume you are going ahead unless we
hear from you.
Mr. Irwin: We will come back only if they wont do it on a banking
basis.
378-376/428-S/80023
November 5, 1970December 31, 1972 483
Mr. Nutter: The university loans require an affirmative vote.
Mr. Selden: What if we dont vote?
Mr. Irwin: This tactic will last only as long as the IDB President
wants.
Mr. Nutter: Surely we can get other people to support us.
Mr. Meyer: This is all part of the longer-range question of building
a case against Chile.
Dr. Kissinger: I favor foot-dragging. We need a few months to see
how things come out. There are other questions which perhaps we
could consider at the next meeting; for example, Chilean trade with
North Korea and when to implement legislative restrictions. There is
also the question of what policy we follow on nationalization of Amer-
ican properties. (to Meyer) I understand you have briefed American
businessmen on Chile.
Mr. Meyer: We talked to David Rockefellers Council of the
Americas, and I will be talking to the Blue Ribbon Committee in Pitts-
burgh next week.
Dr. Kissinger: No investment in Chile is taking place?
Mr. Meyer: I know of no plans for any.
Mr. Mitchell: Is there any resistance in the business community to
the policy of clamping down?
Mr. Meyer: There doesnt seem to be much interest. They under-
stand our careful approach. Some are decapitalizing. I have put to-
gether an inventory of all ties of any sort which the United States has to
Chile. The private debt owed to the United States is $800 million exclu-
sive of the copper companies. Everybody is hoping to get out before the
situation collapses.
Mr. Irwin: What worries me about all of this is that it looks like we
are engaging in economic warfare.
Dr. Kissinger: Are you content with the present position of admin-
istrative delay?
Mr. Irwin: Yes.
Dr. Kissinger: State has provided a recommended public statement
on Chile, and we have an amendment submitted by Defense. These say
roughly what we had intended to say originally. Is there any need to
say anything now?
Mr. Meyer: This came up in the Ad Hoc Group. It is clearly prefer-
able to say nothing until Allendes colors become evident.
Dr. Kissinger: Is there any objection to this? The last time we con-
sidered a statement, we found it was difficult to strike a balance be-
tween appearing too provocative or too conciliatory.
378-376/428-S/80023
484 Foreign Relations, 19691976, Volume XXI
Mr. Irwin: We dont need to say anything. The problem is that
various people may very well get asked.
Dr. Kissinger: We had thought there might be a Presidential press
conference this week and had drafted a response which could be used.
Let me read it: The new President has taken office in accordance with
Chilean constitutional procedures. We have no wish to prejudge the fu-
ture of our relations with Chile but naturally they will depend on the
actions which the Chilean Government may take toward the United
States and the Inter-American system. We will be watching the situa-
tion carefully and in close consultation with other members of the
OAS.
6
Mr. Irwin and Mr. Johnson: Thats good.
Dr. Kissinger: We will distribute it to all of you.
Mr. Irwin: Should we let the President use it first?
Dr. Kissinger: This should be the substance of our position.
Whoever comes to bat first should say it. The Presidential press confer-
ence may not be for two weeks.
On Congressional consultations, I think it would be better to defer
anything we can to the new Congress. The Chairman of the Foreign Re-
lations Committee is fully occupied trying to tear the Cambodian sec-
tion out of the foreign aid supplemental.
Mr. Meyer: Consultations with Congress would involve making
the point that if we are to counter Chile, we need to build ties with our
friends and right now we are not in a position to offer our friends
anything.
Mr. Packard: I think it would do good to begin talking with our
friends on the Hill. We can build a case for enabling us to do something.
Dr. Kissinger: Cant we tell them what we have been telling the
Latin Americans?
Mr. Packard: We should be careful whom we talk to.
Mr. Mitchell: Yes, one of them will find himself before a micro-
phone and start talking. You wont need an Administration position
because they will provide one for you.
Mr. Packard: There is nothing that has to be done tomorrow.
Dr. Kissinger: Lets leave this till our next meeting. We can focus
our efforts on the new Congress.
Mr. Irwin: Has anyone had an opportunity to talk to anyone in
Congress on this?
6
This statement was circulated on November 20 for use by senior U.S. Government
officials. (Memorandum from Davis, November 20; National Security Council, Nixon In-
telligence Files, Subject Files, Chile, National Security Study Memorandum 97)
378-376/428-S/80023
November 5, 1970December 31, 1972 485
Dr. Kissinger: I havent.
Mr. Irwin: I have taken the line that we face a dilemma, that there
are two difficult sides to this question, and that we hope that Allende,
now that he has responsibility, will turn out differently than what we
are inclined to expect from his record.
Dr. Kissinger: I understand that 17 Peace Corps Volunteers are
ready to go to Chile in December. Our policy has been that we should
maintain people-to-people contact. The issue is whether we should
stop the Volunteers from going or ask the Allende government what it
wants to do.
Mr. Johnson: Cant we treat each Volunteer on an individual basis,
depending on where he is going, what he is doing, and what sort of an
individual he is?
Mr. Meyer: There are ten who will be working in forestry and
seven in fisheries. These are not kids; they are the middle-level man-
power types.
Dr. Kissinger: What is your view?
Mr. Meyer: I sort of like the idea of going ahead and sending them.
Mr. Packard: If they are not kids, they might be useful in helping to
maintain contacts.
Mr. Mitchell: When were they recruited?
Mr. Meyer: Early in the spring.
Dr. Kissinger: (to Irwin) What do you think?
Mr. Irwin: I would like to have them there. I am not sure the argu-
ment we used in the case of the military applies here. It may be dif-
ferent just to send them off if they are not wanted. I lean to asking.
Dr. Kissinger: Why not ask? It is not a question of a vital contact. If
the Chileans turn them down, it will show that they are hostile.
Mr. Selden: There is also the question of the Volunteers safety. If
the Chilean Government has asked to have them there, we will have a
better case if something happens to them after they get there.
378-376/428-S/80023
486 Foreign Relations, 19691976, Volume XXI
184. Memorandum for the Record
1
Washington, November 19, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 19 November 1970
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. Johnson, Admiral Moorer, and
General Cushman.
Messrs. John Irwin, Charles A. Meyer, William Broe, Arnold Nachmanoff, and
Wymberley Coerr were present for Item 1.
Colonel Richard T. Kennedy and Mr. Thomas Karamessines were present for the
entire meeting.
1. ChileCovert Action Program
a. Mr. Kissinger commented that the first item on the agenda was
Chile and asked the CIAto provide a briefing on the proposals outlined
in the paper dated 17 November 1970.
2
b. Mr. Broe stated that, essentially, the program consisted of a
number of political actions designed to divide and weaken the Allende
government:
(1) [less than 1 line not declassified] one of the smaller Popular Unity
(UP) coalition parties has been asked by Allende to unite the smaller
parties into a single party as a counterweight to the Communist and/or
Socialist parties, neither of which is under Allendes specific control.
[less than 1 line not declassified] has requested CIA financial support for
[less than 1 line not declassified] effort to form a political bloc capable of
stopping the Communist Party from eventually gaining complete con-
trol of the UP.
(2) Increased efforts are being made to develop intelligence
showing specific vulnerabilities or tensions within the UP which can be
used on a continuing basis in black operations to create splits within
and between UP coalition parties. [3 lines not declassified]
(3) Various subtle efforts are being made to take advantage of Al-
lendes weaknesses and sensitivity to direct criticism by placing tai-
lored articles in selected major newspapers outside of Chile.
(4) Also being explored is the desirability of stimulating and as-
sisting the exodus of key technicians and professionals from Chile in an
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1970. Secret; Eyes Only. Drafted on December 10. A copy was sent to Mitchell, Packard,
Johnson, Moorer, and Helms.
2
Document 181.
378-376/428-S/80023
November 5, 1970December 31, 1972 487
effort to weaken the effectiveness of the government. But it is recog-
nized that such action could have negative results in the loss of compe-
tent opposition leadership within Chile during a crucial period.
(5) Contacts are being maintained and, where possible, enlarged
within the Chilean military forces.
(6) Special briefings are being provided to top Argentine and Bra-
zilian leaders. For example, [name not declassified] has recently been in-
formed of an extremely sensitive report that during a clandestine mid-
night meeting with [less than 1 line not declassified] guerrilla leaders,
Allende had agreed that Chile would become a center of assistance and
training for Latin American revolutionary organizations.
(7) CIA is providing financing [1 lines not declassified] to generate
criticism of the Allende government under the guise of [less than 1 line
not declassified] studies.
(8) Since the Democratic Radical Party (PDR) seems to be finished
politically, Freis PDC and the National Party (PN) and their media are
the only sources of serious political opposition. Studies are continuing
to identify individuals or factions that could provide leadership for an
opposition force. The forthcoming PDC Junta and the upcoming sena-
torial by-elections and the municipal elections should be of help in
identifying potential opposition leadership.
(9) While some support is now being provided to certain opposi-
tion periodicals, it is recognized this could be short-lived in event of a
government crackdown. Therefore, serious consideration is being
given to the purchase of a printing press for contingency use. The possi-
bilities of either purchasing or leasing a local radio station and/or
propagation of third country radio programming into Chile are also
under study.
(10) On the international scene, selected media outlets in Latin
America and Europe are continuing [less than 1 line not declassified] to
publicize the Cuban and Soviet intelligence services subversive efforts,
encroachments on the Chilean constitution and violations of Allendes
guarantees of democratic liberties. A worldwide effort has begun to
provide selected military and civilian policy-makers in Latin America,
Europe and Asia with periodic [less than 1 line not declassified] briefings
detailing specific Chilean Government actions to subvert democracy
and institute a Marxist state.
(11) For contingency purposes, a [dollar amount not declassified]
stockpile of escudos in Chile is planned although it is recognized losses
could be incurred through devaluations or change in currency. [2 lines
not declassified]
(12) The estimate for funding the above proposed CIA covert ac-
tion program for Chile is [dollar amount not declassified].
378-376/428-S/80023
488 Foreign Relations, 19691976, Volume XXI
c. Mr. Broe requested Committee approval in principle for the fore-
going program including specifically funds for the sensitive penetra-
tion agent referred to in paragraph (1) above, continued funding of the
[less than 1 line not declassified] research activity mentioned in paragraph
(7) and the general support provided in the periodical and media field.
He stated that future specific proposals will be submitted for Com-
mittee approval on such expensive items as purchases of printing
presses, radios, and funding to individuals and political parties should
further study and developments make such actions seem feasible and
desirable.
d. Mr. Kissinger referred to the proposed stockpile of [dollar
amount not declassified] in escudos and commented that this did not
seem to be a very large fund to have on hand if stringent currency con-
trols should be imposed.
e. Mr. Broe responded that CIA was confident that it could work
out covert arrangements [less than 1 line not declassified] in Chile to pro-
vide escudos for operations within Chile [1 lines not declassified].
f. Mr. Kissinger stated that he raised this question because he did
not wish the problem of a lack of operational funds in Chile to be used
later as a justification for not being able to follow through on desirable
actions.
g. Mr. Mitchell questioned whether the sensitive penetration agent
referred to in paragraph (1) was under CIA control or whether, if he
was provided the requested funds, he could operate in any direction he
might wish.
h. Mr. Irwin, on the same point, asked if the agent would have
proof (other than his own statement) if he elected to go to Allende and
say he was working for the CIA.
i. Mr. Broe responded to both questions by noting that while it
could not be said the agent was under full CIA control, he has been
working with the CIA for a long period of time, [1 lines not declassi-
fied], and would destroy himself should he inform Allende of his CIA
relationship.
j. Mr. Irwin asked if the capability really exists to carry out the pro-
posed CIA program or if it is just good general planning. He also ques-
tioned just howhelpful it would really be to encourage the exodus from
Chile of key technical and professional personnel in order to weaken
the effectiveness of the government (paragraph (4) above).
k. Mr. Broe pointed out that some of the activities involving local
and international media assets and exacerbation among coalition indi-
viduals and groups are already under way with a degree of effec-
tiveness indicated. With regard to stimulating the exodus of key per-
sonnel, he agreed that this is a most difficult question to decide and
clearly one which needs further study.
378-376/428-S/80023
November 5, 1970December 31, 1972 489
l. Mr. Kissinger, in the role of the devils advocate, pointed out that
the proposed CIA program was aimed at supporting moderates. Since
Allende is holding himself out as a moderate, he asked why not sup-
port extremists.
m. Mr. Broe answered that the overall objective is to sow dissen-
sion within the coalition of parties and individuals supporting Allende,
so anything might be done on a selective basis where it appears advan-
tageous to this end.
n. Mr. Kissinger polled the members, all of whom agreed in prin-
ciple with the CIA program as submitted with the understanding that
additional specific proposals involving large expenditures would be
presented to the Committee as developed.
o. Mr. Mitchell suggested that the Committee be kept regularly in-
formed on progress and developments under the program.
p. Mr. Kissinger agreed and called for a monthly progress report,
or in the alternative, a report on covert action developments for the 40
Committee principals only following each Senior Review Group (SRG)
meeting convened for the purpose of discussing Chile.
[Omitted here is discussion unrelated to Chile.]
Frank M. Chapin
378-376/428-S/80023
490 Foreign Relations, 19691976, Volume XXI
185. Central Intelligence Agency Intelligence Information Cable
1
TDCS DB315/0628770 Washington, November 25, 1970.
COUNTRY
Chile/Cuba
DOI
Early November 1970
SUBJECT
Advice by Fidel Castro to Salvador Allende Concerning His Relations With the
United States and Latin America
SOURCE
[2 lines not declassified]
1. A Chilean diplomat, who is close to Chilean President Salvador
Allende Gossens, said that soon after Allende was elected President, he
held a two-hour telephone conversation with Fidel Castro. The dip-
lomat said one of the major topics discussed during the long conversa-
tion was what policy Allende would follow in his relations with the
United States and Latin America. He said that Castro took advantage of
the opportunity to urge Allende not to repeat the same mistakes that
he, Castro, admitted he had made vis-a`-vis the United States. Castro re-
portedly told Allende that he regretted that he had gone too far too fast
in alienating the United States and said that, if he had it to do over
again, he would proceed differently. Allende apparently agreed with
Castro and told him that he had no intention of antagonizing the
United States beyond the point of no return.
2. In addition to accepting Castros advice on relations with the
United States, the Chilean diplomat said that Allende has given indica-
tions that he wants to try to neutralize, to the extent possible, the fears
and apprehensions of the major military governments in Latin
America, especially Brazil and Argentina. The diplomat speculated
that Allende was leaking information about his conversation with
Castro to selected high foreign officials as a tactic in his efforts to neu-
tralize potential opposition. While Allende realizes he cannot expect
the support and approval of military governments in Latin America, he
is at least hopeful of avoiding their open hostility.
3. Field dissem: None. (Also sent Santiago.)
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. II. Secret; No Foreign Dissem; No Dissem
Abroad; Controlled Dissem; Background Use Only.
378-376/428-S/80023
November 5, 1970December 31, 1972 491
186. Memorandum From Richard T. Kennedy and Arnold
Nachmanoff of the National Security Council Staff to the
Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, December 5, 1970.
SUBJECT
SRG MeetingChile, December 7, 1970
This meeting will serve to (1) update the situation, (2) review spe-
cific actions taken in response to the SRG action memo following the
last meeting, and (3) address specific issues raised by the Working
Groups studies.
You should begin the meeting by asking Mr. Meyer to report on ac-
tions taken since the last SRG meeting. These in summary are:
Military MissionEmbassy instructed not to raise question of its
status. Embassy has advised that GOC is not pressing and seems
willing to continue.
Military Equipment DeliveriesEmbassy was informed that M41
delivery will be delayed as long as possible and decisions on sale of air-
craft will be subject to continuing review.
Peace CorpsChile wants them and visas have been requested.
IDB LendingU.S. representative will remain uninstructed
until further noticethus lending is stopped (Status report Tab 6 State
Paper).
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H50, SRG Meeting, 12/7/70. Top Secret. Sent for information.
Kissinger wrote, I want Chilean media analysis, at the top of the first page. To the right
of that note, he wrote, Options 1 + 2 in Paper 2 not commensurate. 1 talks of advocacy if
req[uired], 2 talks exclusion now. References throughout this memorandum to the
State Paper and its Tabs are to a collection of papers prepared by the Ad Hoc Working
Group on Chile pursuant to the November 19 SRG meeting (see Document 183). The tabs
are papers on the Security Implications of Chiles Participation in the Inter-American De-
fense Board (IADB); a Study of Options for U.S. Strategy Concerning Chiles Future Par-
ticipation in the Organization of American States; Legal Implications of Chilean Trade
with Communist Countries; Plans for Congressional Consultations on U.S. Policy
towards ChileJanuary 1971; Status Report on U.S. Actions to Discourage Further Re-
sumptions of Relations with Cuba; Status Report on U.S. Stance on IDB Lending to Chile;
Status Report on Restrictions on IBRD Lending to Chile; Status Report on Discussions
with Export-Import Bank on Discontinuation of New Credits and Guarantees; and the
U.S. Scientific Projects in Chile. (Ibid., National Security Study Memorandum 97)
378-376/428-S/80023
492 Foreign Relations, 19691976, Volume XXI
IBRD LendingState is providing questions designed to show
Chilean vulnerability in performance to be passed by U.S. Executive
Director to bank personnel (Status report Tab 7 State Paper).
2
Ex-Im Credits and GuaranteesKearns is prepared to cooperate
fully. State is working with Bank officials to sort out specific actions
will report further to SRG. (Status report Tab 8 State Paper).
Mr. Meyer also should be asked to report on his consultations in
Mexico City with Latin leaders concerning Latin interest in reconsid-
ering the OAS sanctions on Cuba. (This is related to the study of op-
tions for U.S. strategy on further Chilean participation in OASTab 2
State Paper.)
The most important issues for discussion at the meeting are:
Options for U.S. Strategy Concerning Chiles Future Participa-
tion in the OAS. (Tab 2 State Paper)
Plans for Congressional Consultations. (Tab 4 State Paper)
Actions to Discourage Further Resumption of Relations with
Cuba. (Tab 5 State Paper)
Your talking points, which follow,
3
request updating briefing by
Mr. Meyer and then address the issues raised in the Working Group
Paper.
4
2
Kissinger wrote, Where does that leave us, to the left of this paragraph.
3
Not printed.
4
At the bottom of the page, Kissinger wrote, Pres. wants Brazilian Pres. invited to
U.S. before July.
378-376/428-S/80023
November 5, 1970December 31, 1972 493
187. Minutes of a Meeting of the Senior Review Group
1
Washington, December 7, 1970, 11:13 a.m.11:57 a.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger CIA
Mr. Richard Helms
State
Mr. William Broe
Mr. U. Alexis Johnson
Mr. Charles A. Meyer JCS
Mr. Samuel Eaton Adm. Thomas H. Moorer
B/Gen. Joseph Belser
Defense
Mr. David Packard* NSC Staff
Mr. Armistead I. Selden Mr. Arnold Nachmanoff
Mr. Raymond G. Leddy Col. Richard T. Kennedy
B/Gen. Robert C. McAlister Mr. D. Keith Guthrie
* Mr. Packard was not present at the start of the meeting.
SUMMARY OF CONCLUSIONS
1. IDB Loans to Chilean Universities. The SRG agreed that a decision
whether or not to support approval of these loans should be deferred
until the question is raised in the IDB Board of Directors. The SRG
noted that these loans might not constitute an appropriate vehicle for
initiating a policy of blocking Chilean access to IDB funds.
2. Inter-American Defense Board (IADB). The SRG endorsed the con-
clusions of the Ad Hoc Group report on the security implications of
Chilean participation in the IADB and agreed that no further action
was required at the present time. The JCS will keep under continuous
review the security aspect of Chilean participation and will report po-
tential problems to the SRG.
3. Chilean Participation in the OAS. With regard to possible OAS ex-
clusion of or sanctions against Chile, the SRG noted that the only fea-
sible course of action at the present time was to concentrate on building
a case against Chile on the basis of Chilean policies and tactics. The SRG
agreed that Chilean disruptive tactics in the OAS should be dealt with
on a case-by-case basis, with US reaction increasing in proportion to
Chilean actions.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H48, Senior Review Group Minutes, Originals, 1970. Top Se-
cret; Nodis. The meeting was held in the White House Situation Room. All brackets are in
the original. All references to options papers are to the collection of papers prepared by
the Ad Hoc Working Group on Chile. See footnote 1, Document 186.
378-376/428-S/80023
494 Foreign Relations, 19691976, Volume XXI
4. Cuba and the OAS. With regard to a possible initiative by Chile,
or any other OAS member, to terminate OAS exclusion of or sanctions
against Cuba, the SRG agreed that the US should actively initiate con-
sultations with other OAS members with a view to seeking reaffirma-
tion in the OAS of the sanctions against Cuba.
5. Revitalizing the OAS. In connection with the forthcoming NSSM
study on the implications of Chile for overall US policy in Latin
America,
2
particular attention will be given to identifying means to re-
vitalize the OAS in order to make it a more effective instrument for pos-
itive action within the Hemisphere, consistent with overall US interests
and objectives.
6. Security Implications of the Allende Regime. JCS will distribute to
SRG members the study being prepared on the security implications of
Soviet establishment of bases or use of facilities in Chile. CIA will pre-
pare a study of the security implications in the Hemisphere from
Chilean propaganda activities and Chilean support for guerrilla activ-
ities. Both of these studies will be completed by December 20.
7. Chilean Trade with Communist Countries. The SRG agreed that the
US should continue to defer making any approach to the Chilean Gov-
ernment to notify it of possible penalties imposed by US law if Chile
trades with communist countries.
8. Scientific Projects. The SRG agreed that the NSF radio astronomy
and Antarctic research projects in Chile should be continued.
Dr. Kissinger: I wonder whether we could just run through the
status of the actions we discussed at the last meeting.
3
Mr. Meyer: They are all discussed in the briefing book. The table of
contents indicates what has been covered.
Dr. Kissinger: If we are all on board on this, then there is no reason
to go through it here. Does anyone have any comments?
Mr. Meyer: I have only one. I would like to call attention to the fact
that there are three World Bank loans to Chile that are beyond recall.
Mr. Helms: One minor point relates to Page 3 of the paper [on the
options for US strategy on Chilean participation in the OAS] where it
notes that Chile has already resumed full relations with Cuba and es-
tablished commercial relations with North Korea. We should add that
the Chileans have begun conversations with the Chinese Communists
in Paris looking toward opening relations with Peking.
2
Presumably NSSM 108, December 10, which directed a review of U.S. policy
toward Latin America. See Foreign Relations, 19691976, vol. E10, Documents on the
American Republics, 19691972, Document 32.
3
See Document 183.
378-376/428-S/80023
November 5, 1970December 31, 1972 495
Dr. Kissinger: With regard to those IDB loans to the universities, I
wanted to raise one question. Someone (I think it was Alex [Johnson] or
Charlie [Meyer]) raised the question whether it was best to veto these
particular loans.
Mr. Meyer: It was Jack Irwin. His point was that if we are going to
have a confrontation with Chile in the IDB, these loans, which are old
ones negotiated with the Frei government, might not provide the best
basis for action by us. If these do come up for decision in the IDB, we
might have to suggest that we make an exception and approve these
loans.
Dr. Kissinger: We can wait to decide until that [a proposal to vote
on the loans in the IDB] happens. What you say would not be an unrea-
sonable proposition. However, there is nothing we can do about it now.
Mr. Johnson: No.
Adm. Moorer: When we discussed this before, wasnt there some
question about whether Felipe Herrera was going to become rector of
one of these universities?
Mr. Meyer: He isnt. But one of his proteges is to be the new
Chilean Ambassador to the United States. His name is Letelier.
Dr. Kissinger: Is he any good?
Mr. Meyer: The reports we have are that he is a bright, able,
charming socialist and also a hell of a liar.
Dr. Kissinger: In that case he is no different from Santamaria.
Mr. Selden: If he is one of Herreras boys, he is no friend of ours.
Also he will know the IDBs operations and that will make it difficult to
outmaneuver him.
Speaking of Herrera, I dont know that we will be doing any better
with Ortiz Mena.
Dr. Kissinger: Why was he chosen? I thought he was our man.
Mr. Selden: Treasury wanted him. They didnt ask our approval.
Mr. Meyer: We werent consulted.
Dr. Kissinger: I have read the JCS paper on Chilean participation in
the Inter-American Defense Board. My only question is what are the in-
formal means for the Chileans to get information there. Can they get a
sense of our direction on strategic policy through informal contacts
with our people on the IADB?
Adm. Moorer: I wouldnt think so. The people we have there dont
participate in the day-to-day discussions of overall policy. They only
come to the Pentagon to receive instructions.
Dr. Kissinger: What do they do?
Adm. Moorer: Not very much.
Mr. Meyer: It is purely cosmetic.
378-376/428-S/80023
496 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger: What type of people do you assign to those jobs?
Adm. Moorer: A flag or general officer. We try to get one with at-
tache experience in Latin America who knows some of those people.
Dr. Kissinger: At any rate you will watch the situation. There is
nothing more to do right now.
Adm. Moorer: Thats right.
Dr. Kissinger: Next we need to take up Chilean participation in the
OAS. The conclusion of the paper is that exclusion or sanctions are not
in the cards in the present situation.
Mr. Johnson: Immediate exclusion.
Dr. Kissinger: The paper also says that harassing the Chileans to
force their withdrawal from the OAS is not a promising approach. The
recommendation is to build a position to use against Chile if an oppor-
tunity presents itself later to move for expulsion.
Mr. Johnson: The paper doesnt make any recommendation, but
the third option seems the only feasible one.
Dr. Kissinger: I have one methodological problem with the paper.
This relates to the two options. The first one, on Page 12, speaks of at-
tempting to organize support for sanctions as soon as there is reitera-
tion by Allende of his advocacy of revolution in the Hemisphere. The
second, on Page 14, reads: Make no move in the OAS now but con-
tinue to document further developments in Allendes attitude toward
armed struggle in other countries, especially any clear evidence of ac-
tual interventionist activities. These are not really commensurate
problems. One assumes that he has reiterated his revolutionary inten-
tion. The other deals with the case where he has not done so. Am I right
that he hasnt made any reiteration yet?
Mr. Meyer: No, he has not.
Dr. Kissinger: The major choices we now have in the OAS are
(1) early concerted action to render Chiles participation in the OAS in-
effectual and (2) countering Chilean tactics on a case-by-case basis and
increasing our reaction as Chiles tactics become more disruptive. That
is a good defensive position. But there is another matter, which I have
discussed with some of you on the phone, which causes me to raise a
question. That is the Presidents order to put out a NSSM on how our
general Latin American policy is affected by Chile. I wonder if in
making this review, we cant think of things we could do to vitalize or
revitalize the OAS. This would be something positive to go along with
our defense posture.
Mr. Meyer: I think the President has done everything possible
along this line. However, the other day I met with some of the people in
my Bureau, and we discussed this.
378-376/428-S/80023
November 5, 1970December 31, 1972 497
Dr. Kissinger: I have no particular suggestions to offer. I would
just like for us to have a look at it. The President has a particular con-
cern about strengthening our relations with Argentina and Brazil. In
that connection, I saw the report of your [Meyers] recent conversation
with [Brazilian Foreign Minister] Gibson.
Mr. Johnson: The toughest problems we have with the Latin Amer-
icans involve trade.
Mr. Selden: I was at the 1962 meeting in Punta del Este when Cuba
was thrown out of the OAS and also the 1964 meeting which decided
on sanctions against Cuba.
4
At those meetings I found that unless we
take the leadership, these people will not act. We didnt have the votes
[to exclude Cuba] when we went down there [Punta del Este], but Mr.
Rusk decided to take the bull by the horns, and the resolution was
passed. We have to take the leadership.
Dr. Kissinger: The point of the proposed NSSM is to come up with
some recommendations on what we should do to exert leadership.
Mr. Meyer: Thats right.
Dr. Kissinger: My experience with Latin Americans is that preci-
sion of thought is not their distinguishing attribute.
Mr. Selden: We have got all the marbles; we have to push this. I
think that it is more likely that the Chileans will get someone else to
raise the issue of Cuba in the OAS. We ought to tell the Latin American
ambassadors that we definitely do not favor bringing up this question.
Dr. Kissinger: That is my next point. What should be our imme-
diate response to Chilean action to raise the Cuba question or to some
proposal along the lines of what the Colombians have been talking
about? I am usually told to bring options to the oval office. However, I
am not authorized to bring in options on improving relations with
Cuba. He doesnt want to hear of it. Of course, if it is the unanimous
view that we should do something along this line, I could bring it up,
but his predisposition is to be against it.
Mr. Meyer: Let me brief on my talks with the concerned Foreign
Ministers, that is, those of Colombia, Uruguay, and Ecuador. I also
talked to Galo Plaza, who is a master example of imprecise thinking. I
took the position that nobody wants to bring the Cuban question before
the OAS. We want to talk about this among ourselves, and that in-
cludes us [the US]. We are part of the team. I said that we all recognize
that there is no possibility of a two-thirds vote to erase the 1964 Resolu-
tion against Cuba. None of them want Cuba back in the OAS or want to
have diplomatic relations with Cuba. However, nobody wants to be left
4
See footnote 4, Document 183.
378-376/428-S/80023
498 Foreign Relations, 19691976, Volume XXI
behind if there is an erosion of the OAS position that will give Cuba a
political victory.
The concept I soldor believe I sold (I will know when I talk to
Galo Plaza again)is that if anyone is concerned about Chileand the
Latin Americans are, and if anyone is concerned about the Rio Treaty
and the future of the Inter-American philosophy of non-intervention
and they are, then the basic thing for us to do is to get together a clear
analysis of the problem. Everybody has a different idea of what the
problem is and what we should do.
Dr. Kissinger: And how will this probably wind up?
Mr. Meyer: That everyone will decide to do nothing.
Dr. Kissinger: I take it your suggestion is that we undertake a
series of bilateral contacts.
Mr. Meyer: Or regional or sub-regional consultationsin which
we take part.
Colombia is the most dovish. The Colombian Foreign Minister told
me, There are risks to the Inter-American system in doing anything
and in doing nothing. I said that in that case we ought to put our cards
on the table and discuss the matter fully. None of them want Cuba back
in the OAS. They are concerned about the economic sanctions but not
about diplomatic sanctions. The Colombian Foreign Minister said at
one point: I dont want to have any of those bastards floating around
in my country.
Dr. Kissinger: I take it that the principal consequence of these con-
sultations would be a reaffirmation of the 1964 Resolution.
Mr. Selden: It will take a two-thirds vote to make any change in the
trade sanctions.
Mr. Meyer: The Latin Americans are caught up in an emotional
position.
Dr. Kissinger: What is involved?
Mr. Meyer: It has to do with the trend toward advocacy of univer-
sality in the UN. The Latins also point out that the Western world is
moving toward recognition of Communist China and wonder what
they should do.
Dr. Kissinger: How will they ease their problem by palavering
with each other?
Mr. Meyer: They wont ease the problem. But we dont want them
to palaver without us. They will talk anyway. They know our position;
the Brazilian position is even harder.
Mr. Selden: Such countries as Nicaragua and Haiti are concerned
about Chile and Cuba. So are other Caribbean countries.
Mr. Meyer: Jamaica, Trinidad, and Barbados dont vote on this,
since they were not members of the OAS at the time the resolution was
adopted.
378-376/428-S/80023
November 5, 1970December 31, 1972 499
Dr. Kissinger: That is an interesting constitutional principle. Are
they bound by the resolution?
Mr. Selden: Trinidad is not abiding by it. Havent they been
trading with Cuba?
Mr. Meyer: It has all been talk on their part. They havent done
anything yet.
Dr. Kissinger: You are not in favor of trying to get a two-thirds vote
for reaffirming the 1964 Resolution?
Mr. Meyer: Yes, I would be in favor. However, the Latin family is
worried about reopening the question of Mexican illegitimacy. Co-
lombia is looking for a way to maintain the Resolution but legitimize
Mexico. The problem is that if you legitimize Mexico, you also legiti-
mize Chile. They dont know what they want. They want to have their
cake and eat it.
Dr. Kissinger: When you say in Option 3 [on page 19 of the paper
on Options for US Strategy concerning Chiles Future Participation in
the OAS] that we should deal with the problem of OAS consideration
or reassessment of the Cuba question on its own merits, what do you
mean? Would you or would you not raise the question in the OAS?
Mr. Meyer: That is just an option.
Mr. Selden: The Defense position is Option 1.
5
Dr. Kissinger: (to Meyer) Which one do you want?
Mr. Meyer: Option 2 is the recommended alternative.
Dr. Kissinger: I am talking about the options discussed on Pages 18
and 19.
Mr. Johnson: (to Meyer) What you have been saying is in line with
Option 1. Your discussions in Mexico City are also consistent with that
option.
Mr. Nachmanoff: What we are discussing now is a broader matter
than the question of dealing with a Chilean initiative on Cuba.
Mr. Selden and Mr. Johnson: Thats true.
Dr. Kissinger: Are we or are we not going to seek OAS reaffirma-
tion of the 1964 Resolution?
Mr. Meyer: I wouldnt want to say until we know what the Latin
concept of reaffirmation is.
(Mr. Packard joined the meeting at this point.)
5
Option 1 is Prepare the groundwork now for concerted action to block any
Chilean initiative in the OAS with regard to Cuba. Option 2 is Avoid adversary atti-
tudes that might give Chile the incentive to introduce question now. Option 3 is Deal
with the problem of OAS consideration of the Cuba question on its own merits and not
primarily as a question of a Chilean initiative. See footnote 1, Document 186.
378-376/428-S/80023
500 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger: But if I understand what Mr. Selden is saying, the
Latin American understanding of anything depends on the leadership
we give them. Where we come out depends on our own preferences
and the energy with which we press them. (to Meyer) Charlie, your
thought is that we first explore the matter in bilateral and multilateral
consultations in order to get the lay of the land and that we then move
for reaffirmation. Would we be taking an active or passive role?
Mr. Meyer: Thats what I had in mind. We would be active.
Dr. Kissinger: Does everyone agree?
Mr. Selden: Yes.
Dr. Kissinger: (to Johnson and Moorer) Alex and Tom?
Mr. Johnson and Adm. Moorer: Yes.
Dr. Kissinger: (to Helms) Dick?
Mr. Helms: Yes.
Dr. Kissinger: Regarding Soviet military facilities in Chile, I think
we need do no more now than to note that it is a problem we may have
to face in the future.
Adm. Moorer: We are working on a Joint Staff paper on the secu-
rity implications of Soviet bases in Chile for the entire Western Hemi-
sphere. I believe it would be useful to make it available to the members
of this Group.
Dr. Kissinger: I think it would be useful to distribute the paper.
Mr. Johnson: I think we have to proceed on the assumption that
there will be no Soviet bases in Chile. What will happen is that Chile
will permit the Soviets to use Chilean facilities, along the pattern of
Alexandria.
Adm. Moorer: But we certainly need to look at this. There is a
chicken and egg question here: which comes first, the policy or the mili-
tary implications? I believe the policy must be derived from the mili-
tary implications.
Dr. Kissinger: I believe the security problems posed by Chile can
be categorized as follows. The first is propaganda. The second is guer-
rilla activity. And the third would be overt military activity, either
through the construction of bases (I agree with Alex [Johnson] that this
is not very likely) or the use of existing facilities. I believe that this third
problem is farther down the road than the other two.
Mr. Helms: I agree. The principal threat is from propaganda and
guerrilla activity. The Chileans would not want to raise our hackles by
getting involved in overt military activity.
Mr. Meyer: I dont feel very comfortable about the report that the
USSR might build a merchant marine base in Antofagasta.
378-376/428-S/80023
November 5, 1970December 31, 1972 501
Dr. Kissinger: If you are uncomfortable, what do you propose to
do about it? Could you get a vote in the OAS against a merchant marine
base?
Mr. Meyer: I doubt it.
Mr. Selden: It is worth exploring.
Mr. Packard: We are all right in the short term, but we should
spend some time looking at the long-term implications so as to be pre-
pared for all eventualities.
Dr. Kissinger: We could look at both the guerrilla question and the
other matter. (to Helms) Dick, could you take a look at the guerrilla
problem? (to Moorer) If you can explore the military side, Dick [Helms]
can look at propaganda and subversion.
Adm. Moorer: My paper will be ready by the 20th.
Dr. Kissinger: Perhaps the 20th will be a bit early for Dick [Helms].
Mr. Helms: (to Broe) What do you think?
Mr. Broe: We can try to have our paper ready by the 20th.
Dr. Kissinger: Now lets take up the legal implications of Chilean
trade with Communist countries.
Mr. Meyer: The legal implications are that such trade will call into
force a certain amount of US reaction in proportion to the size of the
trade.
Mr. Johnson: It seems you would just carry out the legal
requirements.
Dr. Kissinger: We dont trigger a national security exception?
Mr. Johnson: I dont think we would want to do that.
Mr. Selden: What about formally notifying the Chilean Govern-
ment about this [the penalties under US legislation]?
Dr. Kissinger: That is what Ambassador Korry wanted to do.
Mr. Johnson: Is it safe to assume that the Chileans know?
Mr. Meyer: It is always better to remind them.
Dr. Kissinger: Would we do so at a high level or just send the Am-
bassador to see the Foreign Minister?
Mr. Selden: If we do it, we should do it that way.
Mr. Meyer: We called this to Freis attention in the case of Chilean
trade with Cuba.
Dr. Kissinger: Then there is no reason not to do the same with
Allende.
Mr. Johnson: What would be our objective in doing so?
Mr. Meyer: Just to make sure they know the rules.
Dr. Kissinger: Dont you achieve that just by sending them some
notification? How would you do it at a low level?
378-376/428-S/80023
502 Foreign Relations, 19691976, Volume XXI
Mr. Johnson: You could have the desk officer give a memorandum
to the Chilean Embassy here.
Dr. Kissinger: What is the argument against telling them? All we
want is to make sure that they know, without giving them an opportu-
nity to turn it into a test of strength.
Mr. Nachmanoff: One point worth noting is that sanctions under
our present policy are non-sanctions. They apply to PL480 and eco-
nomic aid. Notifying them could raise the implication that if they do
not trade with the communists, then we would go forward with aid.
Mr. Packard: The sanctions can be waived. We ought to advise
them that we are not likely to grant a waiver.
Mr. Johnson: What is the point in raising the matter if no loans or
PL480 are planned for Chile?
Dr. Kissinger: Alexs [Johnsons] point is that if we make an ap-
proach on sanctions and then dont go ahead with our aid, the Chileans
would then have an opening to ask why we are not proceeding with
aid. We have one other possibility. That is the Trading with the Enemy
Act.
Mr. Nachmanoff: There is not much we can do under that.
Mr. Johnson: That would be farther down the road.
Mr. Meyer: On the basis of Arnies [Nachmanoffs] point, then we
should do nothing.
Mr. Packard: Nothing we can do would have much effect.
Dr. Kissinger: Except to give us a pretext for formalizing what we
are already doing. We have never said we are applying sanctions.
Where will we be on this six months from now?
Mr. Johnson: Hopefully the Chileans will have done something
that we can use as an excuse [for denying them aid].
Dr. Kissinger: That is an interesting theory of hopefulness.
Mr. Meyer: I told Allende not to expect anything from AID. He
said he wanted to continue access to the international financial institu-
tions. If he is smart enough to seek funds from the regular capital of the
IBDrather than the Special Fundand if the other Latin American
governments approve, there is nothing we can do to stop him from get-
ting money there.
Dr. Kissinger: If we are in fact not applying sanctions, then a case
can be made for not publicizing it. We might want to save the sanctions
for later.
Mr. Leddy: They are talking to a North Korean trade delegation
about a trade agreement. It may be only a matter of days until we will
have to face the issue.
378-376/428-S/80023
November 5, 1970December 31, 1972 503
Dr. Kissinger: I think we ought to defer a decision and see how
things develop. How about the scientific programs? Is it our view that
they should continue?
Mr. Johnson: Yes.
188. Memorandum for the Record
1
Washington, December 7, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 7 December 1970
PRESENT
Mr. Kissinger, Mr. Packard, Mr. Johnson, Admiral Moorer, and Mr. Helms. Mr.
Mitchell was not present because of a conflicting meeting.
Mr. Charles A. Meyer, Mr. William Broe, and Mr. Arnold Nachmanoff were
present for Item 1.
Mr. John Hart was present for Item 2.
Rear Admiral James C. Donaldson, Jr. was present for Item 3.
Colonel Richard T. Kennedy and Mr. Wymberley Coerr were present for all
items.
1. Chile
a. Mr. Kissinger asked for a progress report on the CIA covert ac-
tion program in Chile.
b. Mr. Broe stated that there are no new proposals, but actions are
continuing designed to exacerbate relations between groups and indi-
viduals in the UP coalition and between UP elements and Allende, as
well as to build a non-communist political opposition. Efforts are also
continuing to develop new contacts and obtain additional intelligence
sources in the Chilean Armed Forces.
c. Mr. Kissinger asked about the current attitude of the Chilean
Armed Forces. He commented that it appeared that the Allende gov-
ernment was handling them much as the Nazis did the German Army
prior to World War II and that the Chilean military were being just as
stupid, if not more so, than the German Army had been.
d. Mr. Johnson thought this a very interesting parallel.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile, 40
Committee Minutes. Secret; Eyes Only. Drafted on December 29. A copy was sent to
Mitchell, Packard, Johnson, Admiral Moorer, and Helms.
378-376/428-S/80023
504 Foreign Relations, 19691976, Volume XXI
e. Mr. Broe responded that the present attitude of the Chilean
Armed Forces could perhaps be best described as one of considerable
caution.
f. Mr. Broe stated that it seems the political situation is changing
some. He observed that the PDC is pulling together more, has pur-
chased a number of newspapers and is still considering the purchase of
Radio Cooperativa. However, the PDC also has a debt of 25,000,000 Es-
cudos resulting from the Tomic electoral campaign, and it is likely they
will be seeking U.S. financial support for their media activities and po-
litical opposition efforts. Mr. Broe pointed out that the National Party
(PN), too, is seeking funds for purchases of news media and is sending
a delegation to Washington for this purpose. He expressed the view
that sponsorship of radio and news outlets by political parties, as op-
posed to individuals, will offer a greater chance of success as Allende
may not move so strongly against a political party as he would against
an individual. Mr. Broe concluded that the main objective must be to
keep the PDC and PN, and factions thereof, from fighting one another
and not provide support to any group unwilling to pull together to
form a Center-Left coalition.
2
g. Mr. Kissinger asked why it is necessary to have a united Center-
Left coalition as long as they are all opposing Allende. He commented
that if a presidential election were going on then we would certainly
want a united opposition, but it seems in the present situation the more
centers of opposition the better it might be.
h. Mr. Broe expressed the view that if the opposition elements
cannot be stopped from fighting one another and persuaded to start
pulling together, the opposition will be ineffective.
i. Mr. Meyer stated that it would seem well to form some kind of
National Unity, instead of Popular Unity, and agreed that the main
problem is to persuade the opposition elements not to fight one
another.
j. Mr. Kissinger asked if Allende would not become aware of U.S.
funding if extensive financial support is provided for the purchase of
news media, presses and radio outlets for opposition elements.
k. Mr. Broe agreed that this would be a problem and it would have
to be handled very carefully. However, he felt that secure arrange-
ments could be worked out through certain European sources and
assets.
2
According to a December 7 memorandum by Nachmanoff, Korry stated in a back-
channel message that he did not find it necessary to use the $25,000 contingency fund
authorized for possible influencing of the PDC Party convention in favor of the Frei
group leadership. Korry noted that the PDC would need substantial funds to purchase
media outlets and for operating expenses in 1971. (Ibid., Chile 1970)
378-376/428-S/80023
November 5, 1970December 31, 1972 505
l. Mr. Kissinger asked what has happened thus far to the media in
Chile and requested a report on the subject. He also requested a memo-
randum on the splits and frictions within the UP between the Commu-
nists and the Socialists.
m. Mr. Helms said he would undertake to provide memoranda in
response to both of these queries. This was done under date of 18 De-
cember 1970.
3
[Omitted here is discussion unrelated to Chile.]
Frank M. Chapin
3
See Document 191.
189. Memorandum of Conversation
1
Washington, December 7, 1970.
PARTICIPANTS
Senator Jarpa, Nacionalista Senator from Chile
Dr. Henry A. Kissinger
Ashley C. Hewitt, NSC Staff
Arnold Nachmanoff, NSC Staff
SUBJECT
Chilean Developments
With respect to the present political situation in Chile and its prob-
able development, Senator Jarpa made the following points:
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret; Nodis. Drafted on December 8. The
conversation was held in Kissingers office. In a December 9 meeting with Hewitt, Jarpa
made the following additional points: A confrontation between the Communists and
Socialists is inevitable. When it occurs, Allende will seek the support of the armed forces
in ridding himself of Communist domination. The armed forces will provide that sup-
port in order to get rid of Soviet and Cuban foreign influence. The result could be a So-
cialist government backed and participated in by the armed forces and based as much on
nationalist as on Marxist ideals. Both this memorandum and the December 9 memo-
randum of Hewitts conversation are attached to a December 10 memorandum from
Nachmanoff to Kissinger. In it, Nachmanoff noted that the memoranda contained intelli-
gence information of potential value to the Department of State and the CIA, and recom-
mended that they be distributed on a Nodis basis. Kissinger disapproved sharing the
memoranda with either agency. Also attached is a December 13 note from Kennedy to
Kissinger, recommending against release of the memoranda, noting that Jarpas views
coincided with the soft line advocated by the State Department. (Ibid.)
378-376/428-S/80023
506 Foreign Relations, 19691976, Volume XXI
A majority of Chileans are socialist in their sympathies. If they
are offered a choice between capitalism and socialism they will choose
the latter.
However the majority are also patriotic nationalists and if given
a choice between the Communist variety of socialism linked to the So-
viet Union and an exclusively national variety they will choose the
latter.
The situation of Allende is inherently unstable and he must
move either to the right or the left. Movement to the left means falling
prey to the Communists and he will make every effort to avoid that.
The future of Chile will probably be decided by the outcome of a
struggle between the Communists on the one hand and the Armed
Forces on the other. He believes the Armed Forces have the better
chance of winning this struggle.
However a government such as that in Brazil or Argentina
cannot be hoped for in Chile because of the fundamentally socialist per-
suasion of the majority, including the majority of the Armed Forces.
The best that can be hoped for is a nationalist government, socialist in
its philosophy, and dependent on the military. Peru is an example of
this kind of government.
The Senator said that before leaving for the United States he had
visited both President Allende and the Foreign Minister and told them
that he would be calling on Assistant Secretary Meyer and other high
officials. At that time Allende and the Foreign Minister made the fol-
lowing points:
His government would make no compromising commitments
with the USSR.
His government would not permit the establishment of Soviet
military bases of any kind in Chile.
His government would not permit the conduct of subversive op-
erations against other countries based in Chile.
His government would not interfere in any way with the
friendly relations maintained between the United States and other gov-
ernments in the hemisphere.
His government hoped for friendly relations with the United
States.
When asked what, in his view, the policy of the United States
should be towards Chile, Jarpa said that we should:
Apply indirect pressures.
Leave open avenues for Allende to move toward the center from
his present position on the left, as the Senator believes he will be
obliged to do by circumstances.
378-376/428-S/80023
November 5, 1970December 31, 1972 507
Resist anti-US actions and initiatives of the Allende Government
in the political field.
When asked about the plans of his party for opposing Allende the
Senator said that the PN plans stiff resistance on an issue-by-issue basis
and has already begun by seizing control, together with the Christian
Democrats (PDC) of the Budget Committee in the Senatea most sig-
nificant political event. However, the PN did not plan a blanket or high
profile opposition to Allende on broadly ideological grounds since this
would be counterproductive. Ideology has little public appeal in Chile,
and attacks based on these grounds might tempt the government to
loose the extreme left wing organizations for purposes of actions of
retaliation.
Concerning developments in the hemisphere generally, Senator
Jarpa said there was definitely a current of socialism or radicalism that
could be distinguished throughout the region, but on balance he felt
this current was more apt to lead to National Socialist or Nasserist type
governments on the Peruvian model than to Communist governments.
Concerning Chiles foreign relations, Jarpa said that relations with
both Peru and Bolivia are at a peak at the moment but are sure to go
down hill as ancient rivalries reassert themselves, which they inevi-
tably will.
(Remarks made earlierwhile waiting in the White House Lobby)
Senator Jarpa commented that the PN was prepared to forget its
long-standing differences with the PDCin fact had forgotten them
but this was not true of the PDC which was still influenced by its own
left wing and the MAPU, a breakoff splinter that now forms part of Al-
lendes UP coalition.
378-376/428-S/80023
508 Foreign Relations, 19691976, Volume XXI
190. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, December 18, 1970.
SUBJECT
Chile Status ReportNovember 27December 11
A. Developments in Chile
Government and Politics
Allende continues to project an image of responsibility and moder-
ation while appointing Cuban-oriented leftists to influential positions.
He continues to adhere to the announced program of the Popular Unity
(UP) Government but has not taken any dramatic steps since the flurry
of activity following the inauguration.
Differences between the Socialists and the Communists in the UP
coalition are becoming more apparent. The Communists are com-
plaining among themselves of having been cut out and have even es-
tablished a special commission to maintain contact with the Presi-
dency. One bone of contention is the 14,000 local committees
established by the UP during the campaign. The Socialists wish to dis-
solve the committees while the Communists wish to retain them as a
mass power base for the Revolution.
Old differences between the Communists and the extreme Leftist
Revolutionary Movement (MIR) erupted into violence as a clash led to
the killing of one MIR youth and the wounding of another. Allende
backed the MIR in this incident. The MIR role in the government seems
to be growing as Allende has appointed many of them to his personal
bodyguard and the new intelligence service he is organizing.
Despite these problems, however, the tone of communist speakers
was vigorous and self-confident at their convention last week and
Party Secretary General Corvalan emphasized the dominant role of the
Party in the UP.
On the opposition side, the Christian Democrats (PDC) have
pulled themselves together to a surprising degree partly due to the
leadership of ex-President Frei and partly due to increasing concern
over the purge of PDC office-holders from the government. A national
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret; Sensitive. Sent for information A
stamped notation on the memorandum indicates that the President saw it. Nachmanoff
sent this memorandum to Kissinger on December 15 with the recommendation that he
sign it and send it to the President. (Ibid.)
378-376/428-S/80023
November 5, 1970December 31, 1972 509
convention of the PDC began December 12 to resolve the pressing
questions of the Partys leadership and its policy toward the Allende
government. A decision to oppose the government strongly and selec-
tion of an anti-Allende leadership might split the Party, but the most
likely result is a moderate policy on opposition and middle of the road
leadership.
The Economy
Allende has reiterated the governments resolve to proceed with
nationalization of major industries, especially American-owned copper
mines. However, he has indicated his intention of going to Congress for
enabling legislation, and there has been talk of a possible amendment
to the Constitution. Hence, widespread nationalization may be de-
layed. Thus far only one firm has been nationalized, a large textile fac-
tory owned by Chileans of Middle Eastern origin.
2
Two small Amer-
ican firms intervened earlier remain under government management
but technically ownership continues to be private. In a move to protect
itself from excessive wage demands as well as gain labor support the
government signed an agreement with the CUT, the countrys largest
labor confederation, which in effect makes the CUT the labor arm of the
government.
Foreign Relations
In a recent press conference Allende once again reiterated his hope
for friendly relations with the United States. On the same occasion he
said his government was exploring ways for normalizing relations
with Bolivia, with which diplomatic relations have been suspended
since 1962. Chile signed an agreement to export copper to Red China
and also received an East German trade mission, but is still in no hurry
to accord diplomatic recognition to more Communist countries. How-
ever, conversations in Chile do point toward an eventual establishment
of relations with Red China.
Chile made its first purchase of Russian machinery under an old
credit agreement. The machinery will be used on public works projects.
The Soviets reportedly have indicated interest in establishing a mer-
chant marine facility in Chile. The facility would service both fishing
and merchant vessels.
B. US Actions
With respect to US policy we have:
Initiated a re-examination of our entire hemispheric policy in
light of developments in Chile.
2
President Nixon underlined the phrase owned by Chileans of Middle Eastern or-
igin and wrote in the left margin, Lebanese?
378-376/428-S/80023
510 Foreign Relations, 19691976, Volume XXI
Launched a review of our military programs in the hemisphere
in view of your decision to increase efforts to expand contact with Latin
American military leaders.
On the diplomatic front we have:
Provided information on Chile to other hemisphere govern-
ments and to certain of our allies in Europe and elsewhere.
Undertaken consultations with members of the OAS to dissuade
them from following Chiles recognition of Cuba; we are providing de-
tailed information to them on the continuing threat which Cuba poses
to the peace and stability of the hemisphere.
Adopted a strategy to counter Chilean tactics in the OAS and
build a case for stronger sanctions as warranted.
On the economic side we have:
Cut off new Ex-Im Bank loans and guarantees to Chile.
Continued to stall consideration of loans for Chile in the IDB and
IBRD.
3
With respect to the military we are continuing normal contacts,
while delaying action on new commitments.
The NSC Senior Review Group also:
Approved measures to continuously review Chiles participa-
tion in the Inter-American Defense Board to assure that no security
problems arise.
Initiated studies of the security implications of:
a. possible Soviet military use of Chilean facilities;
b. Chilean propaganda activities and Chilean support for guerrilla
activities in the hemisphere.
3
In the left margin, President Nixon wrote, Continue, and highlighted this and
the previous point.
191. Editorial Note
On December 18, 1970, the Central Intelligence Agency submitted
three memoranda to the Presidents Assistant for National Security Af-
fairs Henry A. Kissinger and the members of the 40 Committee in re-
sponse to instructions given at the December 7 meeting (see Document
188). The memorandum on Friction within the Unidad Popular
presents a detailed chronology of inter-party strife among members of
378-376/428-S/80023
November 5, 1970December 31, 1972 511
Chilean President Salvador Allendes coalition. It goes on to recount
CIAs efforts to exacerbate tensions and embarrass Allende by placing
propaganda in the European and Latin American press, underscoring
friction within the Unidad Popular (UP), and focusing on Allendes
poor health, heavy drinking, promiscuity, and expensive tastes. More-
over, the CIA had supported efforts to wreak havoc on the Chilean
Communist and Socialist Parties by creating a counterbalance to the co-
alitions and disseminating intelligence designed to foster mistrust. In
addition to these and other activities, the CIA intended to plant evi-
dence that Cuba was providing support to sectors of the Allende gov-
ernment, which might arouse a military reaction vis-a`-vis certain
sectors of the Allende coalition. (National Security Council, Nixon In-
telligence Files, Subject Files, Chile, 303/40 Committee Files)
The memorandum on Chilean Facilitation of Subversive Activ-
ities in Latin America begins by noting that there was little intelligence
that Chile supported guerrilla activities. Thereafter, it catalogues the
presence of Latin American leftist leaders in Chile, describes potential
institutional vehicles for supporting external subversion (the Chilean
Foreign Office, the trade union movement, and international forums)
and assesses a possible approach that the Soviet Union might take in
employing Chile as a model of successful Marxist government. The text
of this memorandum is Document 42 in Foreign Relations, 19691976,
vol. E16, Documents on Chile, 19691973.
The memorandum on Chilean Media Under a Marxist Regime
concludes that political and economic pressures applied by the UP,
coupled with a related decrease in advertising revenue, resulted in a
significant portion of the Chilean mass communications media focused
on receivership and ultimate UP control. It also notes, however, that
some newspapers and radio stations directly associated with opposi-
tion political parties continued to wage an aggressive anti-Communist
campaign. This effort merited encouragement and support. The text of
this memorandum is ibid., Document 41.
378-376/428-S/80023
512 Foreign Relations, 19691976, Volume XXI
192. Transcript of a Telephone Conversation Between the
Ambassador to Chile (Korry) and the Presidents Assistant
for National Security Affairs (Kissinger)
1
Washington, December 19, 1970, 3 p.m.
K: I have talked to Irwin and there is no problem about staying
until April as far as I know. He has to talk to the Secretary.
2
Ko: You spoke today? I had an unsettling talk this morning. Irwin
said it could happen next week.
K: I dont believe it. I talked to him around noon. If it doesnt
happen the way I said, I would be prepared to intervene.
Ko: Its terribly unsettling.
K: Of course, and you dont deserve it.
Ko: They are using me as a football indirectly with you. It goes
back to the people around the Secretary with the development
business. The President accepted the Peterson report and they think I
ganged up with you. The recommendation that the Peterson Commis-
sion adopted would denigrate the powers of the Department. They
havent ever gotten over it and have been waiting ever since.
3
K: I didnt have any views.
Ko: I have explained that a dozen times. I dont know where I go
from here.
K: Hold on a bit. Things are always in a state of flux.
Ko: With four kids . . .
K: You dont deserve to have to panic, and dont. We will do what
we can.
Ko: Irwins talk this morning goes back to our talk the other day.
4
K: I had hoped it would straighten out without White House inter-
ference, but I am prepared to intervene.
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 365,
Telephone Conversations, Chronological File. No classification marking.
2
Irwin called Kissinger at 11:37 a.m. to discuss several issues, including when
Korry would resign. A transcript of the conversation is ibid.
3
In 1969, Korry prepared a report on U.S. foreign assistance as directed by NSSM
45, April 21, 1969. His report was released in early March 1970, at the same time as the
report of the Task Force on International Development, chaired by Rudolf Peterson. Pres-
ident Nixon based his proposals for changes to the U.S. foreign assistance program on the
Peterson report. See Foreign Relations, 19691976, vol. IV, Foreign Assistance; Interna-
tional Development; Trade Policies, 19691972, Documents 123 and 124.
4
According to his Record of Schedule, Kissinger last met Korry on December 8
from 2:32 to 2:50 p.m. (Library of Congress, Manuscript Division, Kissinger Papers, Box
438, Miscellany, 19681976, Record of Schedule) No substantive record of the conversa-
tion has been found.
378-376/428-S/80023
November 5, 1970December 31, 1972 513
Ko: When I go back, we are entering a rough period on the copper
thing. I will be sending cables. I will also write a letter with regard to
your latest NSSM.
5
K: I would love that. Would you do that? I wont show it to
anyone.
Ko: Thank you, Henry.
5
No letter was found. Korry is probably referring to NSDM 108, December 10; see
footnote 2, Document 187.
193. Paper Submitted by Acting Director of Central Intelligence
Cushman to the Presidents Assistant for National Security
Affairs (Kissinger)
1
Washington, December 21, 1970.
SUMMARY. After examination of all source material available in
Washington and the field, we do not find confirmed information that
directly implicates Chilean President Salvador Allende or his top gov-
ernment associates with narcotics trafficking to the United States. What
we do find is Chilean Government tolerance of this traffic at too many
levels for Allende (or his predecessor, Eduardo Frei, for that matter) to
be ignorant of it for long. Whether Allende will take action against this
rather widespread drug trafficking by Chilean Nationals is not known
but Frei, whose rectitude was well-established, saw no reason to do so,
possibly because drug abuse is not a serious domestic problem in Chile.
An ominous new fact, however, is Allendes appointment of a
known narcotics trafficker to a lower down but still important position
in a new Chilean internal security service being organized under
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret. Printed from a copy that bears
Cushmans stamped signature, as well as notations indicating that the original was
signed by John Ingersoll, Director of the Bureau of Narcotics and Dangerous Drugs, and
had been signed on behalf of Miles J. Ambrose, Commissioner of Customs. The paper
was submitted to Kissinger attached to a December 29 memorandum from Nachmanoff
recommending that nothing further be done in view of the agencies findings. Nachma-
noff added he would remain in contact with the agencies and would inform Kissinger if
any additional significant information developed. On this memorandum, Kissinger
wrote, OK but I want follow-up given high prioritywe may be able to develop some-
thing we can use later. (Ibid.)
378-376/428-S/80023
514 Foreign Relations, 19691976, Volume XXI
Cuban Government direction. Also of concern is Allendes close per-
sonal relationship with a known narcotics trafficker who maintains ex-
tensive connection with the international drug traffic.
Not only is Allende still new in office, but also U.S. Government
coverage of drug traffic from Latin America is being intensified. It is
therefore possible that firmer links between Allende and this traffic
may yet appear as a result of additional information or that Allendes
conscious condoning of the traffic may become demonstrated.
[Omitted here is the Discussion Section.]
Conclusions.
We conclude that Chilean Nationals have a large role in smuggling
narcotics into the United States, and in nearly every instance of
large-scale narcotics traffic from Latin America there has been Chilean
involvement in one way or another. Nevertheless, we are unable to as-
sociate the present narcotics traffic with any one political leader or po-
litical party.
The mere fact that this traffic flourished during the regime of
Christian Democratic President Eduardo Frei as well as under the
present government demonstrates that Chilean involvement in illegal
narcotics traffic is not a newphenomenon. Contributing to this involve-
ment, we believe, are numerous factors which in some sense are unique
to Chile. These include the geography of the country with long and rel-
atively unpatrolled borders; an abundance of processing chemists;
large numbers of educated people with few profitable employment op-
portunities, who then turn to other practices, and a local political cli-
mate in which many officials and politicians are available for a price.
We found no evidence which linked President Allende or his gov-
ernment per se with drug trafficking to the United States. Whether he is
aware that a sizeable number of people, including those he knows per-
sonally and those who helped in his election, are engaged in the nar-
cotics business is open to conjecture. He can, of course, deny any
knowledge of such traffic and we would not be able effectively to dis-
pute such a denial on the basis of information now available.
We believe, however, that Budnevich, as an official in the Allende
governments security apparatus, will be in a position to contribute to
further expansion of Chilean participation in the narcotics traffic and as
such constitutes a clear and present danger.
We lack a definitive reading on Allendes own views on narcotics.
Although our files on him are extensive and by our standards he has
vices and is not judged by us to be morally strong, at no time has he
himself been associated with narcotics traffic. The question thus re-
mains whether Allende as a doctor would find drug trafficking repug-
nant, once he came to focus on it, or whether he would sanction the
378-376/428-S/80023
November 5, 1970December 31, 1972 515
same for financial or political ends, or support the interest certain of his
supporters certainly have in it for their sake. He is still feeling his way
in office and more information will be needed definitely to establish his
position vis-a`-vis this traffic.
194. Minutes of a Meeting of the Senior Review Group
1
Washington, December 23, 1970, 5:076:17 p.m.
SUBJECT
Chile
PARTICIPANTS
ChairmanHenry A. Kissinger JCS
Adm. Thomas H. Moorer
State
B/Gen. Joseph Belser
John N. Irwin, II
John Crimmins USIA
Samuel Eaton Frank Shakespeare
Defense NSC Staff
Armistead I. Selden Arnold Nachmanoff
Raymond G. Leddy Col. Richard T. Kennedy
Jeanne W. Davis
CIA
LTG Robert E. Cushman
William Broe
SUMMARY OF DECISIONS
It was agreed that:
(a) activities at the NASA station in Chile should continue;
(b) a $10 million agricultural sector loan should be de-authorized;
(c) monthly reports on continuance or extension of AID loans and
grants and on loan utilization will be made to the SRG Ad Hoc Group,
rather than AID/Washington;
(d) the SRG Ad Hoc Group will receive prior notice of terminations
of grants;
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H50, SRG Meeting, Chile, 12/23/70. Secret; Sensitive. A copy
was sent to Nachmanoff and Kennedy. The meeting took place in the White House Situa-
tion Room. Kissinger OKed these minutes on the attached December 28 transmittal
memorandum from Davis. For the text of the options papers discussed, see Foreign Rela-
tions, 19691976, vol. E16, Documents on Chile, 19691973, Documents 41 and 42.
378-376/428-S/80023
516 Foreign Relations, 19691976, Volume XXI
(e) Option 4 on extension of the ship loan agreement will be re-
worded to provide a recall clause and to refer the question, if and when
the Chileans raise it, to the SRG;
(f) The Presidents reaction will be sought to the recommendation
for approval of the IDB loans to Catholic and Austral Universities;
(g) the Eximbank will be advised to reduce guaranties and insur-
ance for exports to Chile but not to stop them;
(h) State will draft a formulation for an approach to the Chileans
on the expropriation action, before the proposed Constitutional
amendment is approved, indicating our readiness to help in negotia-
tions with the companies but warning them that, if no satisfactory solu-
tion is reached, there are certain steps that we will be required by law to
take;
2
(i) regarding our public position, we should respond to questions
with the line that, for the next sixty days, the issue is in the constitu-
tional process and we do not wish to prejudge the outcome; however,
while we do not contest the right of a sovereign nation to expropriate
property, we have the right under international law to ask for fair
compensation.
Mr. Kissinger: Before we disband, I thought we might have a brief
discussion of where we stand on various issues. We have six issues,
and I suggest we consider first the four of these which appear relatively
easy to dispose of.
First, the continuation of the NASA station in Chile. The Working
Group has recommended that its routine activities continue. Does
anyone disagree? Our basic policy calls for keeping our contacts with
the military and the people. The NASA station doesnt fit this perfectly,
but do you all agree that it should be continued?
All agreed.
Mr. Kissinger: The second item concerns AID commitments to Chile.
NSDM 93
3
called for exploration of ways to terminate or delay ex-
isting commitments. I understand we have about $25 million in undis-
bursed loans, $2 million in grants and up to $10 million in PL 480 hu-
manitarian food programs. The Working Group has recommended that
2
On December 21, Allende announced that he would submit legislation for a con-
stitutional amendment to nationalize the U.S. interests in the Chilean copper industry.
The legislation would modify Chilean property rights and authorize the government to
expropriate mines. Allende emphasized that foreign companies would receive compen-
sation. (Allende Asks Law To Seize Copper, New York Times, December 22, 1970, p. 7)
3
Document 175.
378-376/428-S/80023
November 5, 1970December 31, 1972 517
a $10 million agricultural sector loan, which has not yet been discussed
with the Allende government, be de-authorized. Do you all agree?
All agreed.
Mr. Kissinger: They also recommend that the AID mission be in-
structed to delay draw-downs of existing loans and grants where fea-
sible, although we would not invoke the legally available options for
cancelling remaining balances since this would constitute a clear, overt
political act. Does anyone disagree?
Mr. Irwin: To save time, I might say that we agree with all the
recommendations.
Mr. Kissinger: You made them!
Mr. Crimmins: The Working Group made them with the full par-
ticipation of all.
Mr. Selden: We would like to see Recommendations 3, 4, 6 and 7
recast to bring these matters back to the SRG Ad Hoc Group for deci-
sion rather than have the Ambassador or AID Mission Director making
the decisions.
Mr. Crimmins: This would create a very complicated administra-
tive situation, requiring the Ad Hoc Group to involve itself in great de-
tail. The purpose of these recommendations was to break the adminis-
trative logjam created by the standstill following the last meeting.
4
Mr. Kissinger: Recommendation 4 calls for an instruction to the
AID Mission to terminate grants. Why would this need to be referred
back to Washington? When the Ambassador wants to terminate an
agreement, we should give him the authority. That is the direction in
which we are going. If he does not do it fast enough, then it should be
brought to the attention of the SRG, but why should we not give him
the authority to terminate these grants?
Mr. Selden: It also gives him authority to continue grants.
Mr. Kissinger: Within the existing budget?
Mr. Irwin: Within the $2 million.
Mr. Crimmins: This would be true only within the outstanding
balance of grants. It would not involve any new programsit refers
only to existing programs. It provides guidance to the Country Team to
terminate grants selectivelyto phase down but to continue some
projects, mostly involving training in the US for some technicians.
Mr. Kissinger: (to Selden) What is wrong with that?
Mr. Selden: Nothing. But we believe the Ad Hoc Group should
keep control of whats going on.
4
See Document 187.
378-376/428-S/80023
518 Foreign Relations, 19691976, Volume XXI
Mr. Kissinger: Could we do this by a monthly report on those pro-
grams which are continuing?
Mr. Crimmins: We have indicated in Recommendation 3 that
AID/Washington will be given prior notice of major extensions and pe-
riodic reports on loan utilization.
Mr. Selden: But thats not the SRG.
Mr. Kissinger: If we changed AID/Washington to the SRG Ad Hoc
Group as recipient of these reports, would that take care of your
concerns?
Mr. Selden: Yes, it would.
Mr. Kissinger: Does anyone have any problem with the PL 480 hu-
manitarian food program? It is the Presidents intention to phase down
our AID activitiesto undertake nothing new and to use no adminis-
trative devices to keep things going, but to do this in such a way that
Allende cant claim we are exerting pressure on him. This will be tough
to do.
Mr. Crimmins: These recommendations were cast with that in
mind.
Mr. Kissinger: Can we agree that terminations do not need to come
back to the Ad Hoc Group for approval?
Mr. Crimmins: The Ad Hoc Group will have prior notice, which
will give them a chance to blow the whistle if they wish to.
Mr. Kissinger: (to Selden) Is that okay?
Mr. Selden: Okay.
Mr. Kissinger: A third issue is the extension of the ship loan agreement.
Mr. Selden: We have a fifth option on this which we would like to
have considered. (Passed out new option at the table) It is a combina-
tion of Options 3 and 4.
Adm. Moorer: We would support this option.
Mr. Shakespeare: Isnt the key to this question the attitude of the
Navy. I understand they dont want the submarine back.
Mr. Kissinger: Im told it probably couldnt make it back.
Mr. Shakespeare: Does their Navy want it? Would this be an addi-
tional contact with their Navy? If we should decide recall of the ship is
not desirable, does this mean that when the agreement expires in 1971,
we would just wink and let them keep it?
Adm. Moorer: The unilateral consideration of whether or not to re-
call the ship would be made on the basis of their attitude.
Mr. Kissinger: I have no strong personal views on this. (to Selden) I
think your first point is spelled out in Option 4: do nothing unless they
raise it; if they raise it, say we will study it. Why do we have to decide
now whether to extend the agreement for three years or X years? We
378-376/428-S/80023
November 5, 1970December 31, 1972 519
can look at it when it comes up, in the light of the circumstances. If the
Chilean military remains a weight on the scale on the anti-Allende side,
we would want to stay in contact with them.
Mr. Selden: Thats all right as long as it comes back to the Ad Hoc
Group. We wouldnt want to extend the agreement for three to five
years without the recall clause.
Mr. Kissinger: (to Crimmins) Can you reword Option 4 to make
these additional points?
Mr. Crimmins: We can specify extension only for a year with a re-
call clause.
Mr. Irwin: We might not want to extend it at all.
Mr. Kissinger: Or we might want to extend it for a longer period.
We want to keep maximum contact with the Chilean Navy as long as it
is a potential anti-Allende force. We should favor whatever favors it.
There would be no problem in coming back to an automatic turn-
down, if that were desirable. We could agree to delay a response for
further study.
Mr. Irwin: Or refer it to the SRG.
Mr. Kissinger: Yes. Do you all agree?
All agreed.
Mr. Irwin: There would be a quasi-legal point in providing the
ship without a continuance of the agreement, but I wouldnt worry
about it.
Mr. Kissinger: What is our legal position? Is it a serious problem?
Mr. Irwin: I dont think so.
Mr. Crimmins: Some Congressmen might get a little restive about
it, but I think we could sell it on the grounds that we are trying to main-
tain ties with the Chilean Navy.
Mr. Kissinger: On the matter of IDB loans, the Chileans have now
agreed to put up their share for the university loans pending in the IDB.
Mr. Shakespeare: On both loans?
Mr. Crimmins: Yes.
Mr. Shakespeare: So we now have a formal request from them.
Mr. Crimmins: Yes, it will come before the Board of the Bank to-
morrow. Our Executive Director believes he can hold off a decision
until the 14th, but the pressure will increase at the January 7 Board
meeting.
Mr. Kissinger: (to Irwin) What do you recommend?
Mr. Irwin: That we go ahead on the 7th to make the loan to the two
universities.
Mr. Kissinger: (to Moorer) What about you?
378-376/428-S/80023
520 Foreign Relations, 19691976, Volume XXI
Adm. Moorer: I defer to Mr. Irwin.
Mr. Shakespeare: I agree we should do it. Loans to the universities
are the wrong issue to make a case on. I have reservations on Catholic
Universityit operates the most pro-left, pro-Castro television station
in Latin America. We operate on the wrong assumption that all Cath-
olics are anti-Communist, which is just not true in Latin America. How-
ever, our Ambassador says that the Frei forces have made a major effort
to move into Catholic University and that there was a shift to the right
in a recent student election. Also, it is usually true that opposition to
Communist governments is formulated more in the universities than
elsewhere. The other university is even safer. I think the amount is
small and that this is the wrong issue for us to make a case on.
Mr. Kissinger: (to Cushman) Do you agree with the Ambassadors
assessment of the influence of Freis forces?
Gen. Cushman: We agree with the Ambassadors assessment, but
the Frei forces arent forces. He has no control of even his own junta.
Mr. Kissinger: Has he lost out to left-wing control?
Mr. Crimmins: Not clearly. There is considerable waffling.
Mr. Kissinger: Will this action by the IDB be taken as a go-ahead by
other lending institutions?
Gen. Cushman: The University of Chile may come in for a loan,
and they are really bad news.
Mr. Shakespeare: They didnt link these loans to anything for the
University of Chile.
Mr. Irwin: These were pending loans. Anything else would be a
new request.
Mr. Nachmanoff: Other international agencies will see a positive
vote as an indication that we are willing to go ahead in some degree.
Mr. Shakespeare: Could we make it known informally, possibly by
a leak, that these are special university loans and are not to be consid-
ered precedental?
Mr. Crimmins: There will be no problem in the Export-Import
Bank.
Mr. Selden: If we go ahead with this, it should be with the full
knowledge that Catholic University is heavily Communist and that the
Rector has supported Castro publicly. If we can separate the loans, I
would prefer one and not the other.
Mr. Crimmins: We couldnt make the case for separation.
Mr. Selden: Why not?
Mr. Crimmins: There would be no reason other than an overtly po-
litical one for making such a distinction. We are trying to avoid any
overtly political act which would play into Allendes hands.
378-376/428-S/80023
November 5, 1970December 31, 1972 521
Mr. Selden: How would we distinguish between these universities
and the University of Chile?
Mr. Crimmins: That would be a new loan request, and we have all
sorts of stalling devices available.
Mr. Selden: But we would eventually have to make a decision.
Arent we creating a precedent for a favorable decision?
Mr. Kissinger: At some point we will undoubtedly have to turn
down some loan, but that will be a political decision.
Mr. Shakespeare: We should choose our own ground for making
that kind of decision. Also, by the time such a loan request might be
made, we will know more about the situation.
Mr. Irwin: These two loans have been pending for a long time.
Mr. Kissinger: How much is involved?
Mr. Shakespeare: $12 million.
Gen. Cushman: I might add that the Rector is completely
ineffective.
Mr. Selden: I still have some reservations about this.
Mr. Kissinger: (to Irwin) You need a decision by January 7 al-
though it could wait until January 14 if necessary. I wonder whether we
shouldnt run this by the President.
Mr. Shakespeare: Is there another Board meeting in February?
Mr. Crimmins: Yes, but this would create a difficult situation for
Ortiz Mena.
Mr. Shakespeare: What does Korry think about it?
Mr. Kissinger: He seems to have a blank spot on the PDC. He exag-
gerates their prospects.
Mr. Shakespeare: There is the danger that this would create a fa-
vorable attitude toward other loans. But this $7 million to Catholic Uni-
versity and $5 million to Austral University do nothing to help the
Chilean economy or governmental structure.
Gen. Cushman: Also, there is some doubt that the Allende gov-
ernment can put up the escudos.
Mr. Crimmins: He has pledged them.
Mr. Kissinger: Might this affect IDB replenishment?
Mr. Irwin: We would have to tell both House and Senate
subcommittees.
Mr. Kissinger: I will run this by the President to get a sense of his
feeling, and then I will talk to you (Messrs Irwin and Crimmins).
Mr. Shakespeare: Our Ambassador says the Rector of Catholic
University has tried to establish closer relations with Notre Dame.
378-376/428-S/80023
522 Foreign Relations, 19691976, Volume XXI
Would it be a good idea to get a private reaction from Father
Hesburgh?
Mr. Irwin: We could be criticized in the Congress for these loans.
Mr. Kissinger: It has the advantage of giving us some protection if
we have to crack down later. I will run this by the President. If he reacts
negatively, we may still want to recommend it. We wont make any de-
cisions without further discussion here.
One major issue is the question of guidance to the Eximbank on its po-
sition on guaranties and insurance for exports to Chile. We have three op-
tions, to which the Kissinger Law seems to applythe middle option
seems to be the most reasonable. I understand the Working Group
agreed that we should advise the Bank to reduce guaranties but not to
stop them. What does this mean? How would they go about reducing
them?
Mr. Crimmins: They would act only on selected ones.
Mr. Kissinger: Would they tend toward the hard or soft side?
Mr. Irwin: They would do nothing new and let the others fade.
They would take no specific action to stop them.
Mr. Kissinger: Are all agreed on this course?
All agreed.
Mr. Irwin: The Eximbank has $400 million in exposure now.
Mr. Kissinger: Can we turn to the expropriation issue. As you
know, Allende has now sent to the Congress a Constitutional amend-
ment for nationalization of US copper enterprises. We have four
choices: (1a) suspend assistance immediately, but without formally in-
voking the Hickenlooper amendment, with (1b) which would formally
invoke Hickenlooper; (2) and (3) would refrain from applying Hicken-
looper until the six-month period runs out, with the difference being
that under (3) the US would take an active role in the negotiations with
the Chilean Government and the companies; and (4) which would in-
volve an active USG involvement but would avoid application of Hick-
enlooper as long as there were plausible grounds for delay.
Mr. Crimmins: Option 2 is essentially passivewe would just wait
out the six months.
Mr. Kissinger: But we would let the companies negotiate if they
want to.
Mr. Crimmins: Yes, but we wouldnt encourage them one way or
another. Option 3 would involve us directly in the negotiations during
the six months period while maintaining the present level of economic
restrictions against Chile.
Mr. Kissinger: Would the Constitutional amendment amount to
expropriation?
378-376/428-S/80023
November 5, 1970December 31, 1972 523
Mr. Crimmins: It is a very hard position. There is an outside chance
that the companies might be able to negotiate something. Kennecott
has asked us not to preempt any position they might wish to take by
references to Hickenlooper. The Kennecott Board is meeting today to
analyze the situation and get an idea of the options open to them. Some
things are not clear, e.g., it talks about compensation in money but
doesnt say whether in dollars or escudos. The terms are very hard,
though.
Mr. Kissinger: Amounting to expropriation?
Mr. Irwin: If they are carried out. It is not expropriation yet.
Mr. Kissinger: In October we thought about the desirability of
telling them the consequences of certain actions, but we decided
against it.
5
This might be a good opportunity to warn them in a low-key
way.
Mr. Irwin: It would be possible to do so in a low-key way that
didnt tie us down, or in a way that would require us to act at the end of
the six-month period. If we decided to invoke Hickenlooper and were
called before the OAS, we would be worse off politically if we had
given them no warning than if we had.
Mr. Kissinger: Are there arguments against this?
Mr. Crimmins: In the situation with Peru, we did present them
with a note when the expropriation process began. This led to an ex-
change of notes which we regretted later. We can get ourselves in-
volved in a very convoluted process.
Mr. Kissinger: Why did we regret it?
Mr. Crimmins: It gave the Peruvian Government an opportunity to
come back to us with a propaganda position. They raised the question
of our right to become involved with the IPC which was in fact a Cana-
dian company. It might be a risk worth taking, however.
Mr. Kissinger: We have two choices: to do nothing or to do some-
thing, either threatening them with Hickenlooper or indicating that we
expect compensation. We should make it clear that we would do some-
thing but maintain some flexibility as to what it might be.
Mr. Crimmins: The nature of any communication to the Chileans
along this line would depend on what option the SRG chooses. If we
chose Option 3, one technique would be a low-key oral discussion with
a view to encouraging the Chilean Government to listen to any com-
pany proposals. If we chose an earlier option, we might want to change
5
See Document 169.
378-376/428-S/80023
524 Foreign Relations, 19691976, Volume XXI
the content and tenor of the communication to verge on the
threatening.
Mr. Irwin: The economy of Chile will be basically affected by the
climate for private investment, and that is gone now. That takes away a
lot of points of possible support for Allende. Another factor is the state
of the copper enterprises. If Allende succeeds in copper, what we do
wont hurt him. If he fails, then the economic situation will be so ad-
verse that we wont affect it greatly by taking the actions we are
thinking about.
Mr. Shakespeare: Why might he not be able to make the mines go
successfully?
Mr. Irwin: Capital, technical assistance, bureaucratic problems.
Mr. Shakespeare: Is marketing a factor?
Mr. Irwin: Marketing would be less difficult.
Mr. Crimmins: I personally think they can make it go. We buy very
little copper fromChile. However, 50 percent of Europes copper comes
from Chile and they couldnt cooperate in any boycott.
Gen. Cushman: Chile has 30 percent of world copper exports.
Mr. Kissinger: Instead of arguing on the nature of his regime, Al-
lende is getting us into a fight on economic questions, where he is
strong and we are weak.
Mr. Shakespeare: Any extractive industry makes a very poor issue
on which to fight.
Mr. Irwin: This is more a political issueeconomically it wont
make much difference. One copper company has already asked us not
to step in at this time.
Mr. Kissinger: Businessmen dont understand politics.
Mr. Crimmins: ITT has been adjusting to political factors since
1966 and has come out all right.
Mr. Kissinger: I dont say we should get involved in the negotia-
tions. I think there is a good case for not doing so and for applying
Hickenlooper when it is due.
Mr. Irwin: We may find ourselves in a situation where we dont
have a choice.
Mr. Kissinger: In Peru, we had an interest in keeping the regime
from moving further to the left.
Mr. Shakespeare: If we go with Hickenlooper, we will need to
build up in all of Latin America the idea that the issue is not the right
of a country to expropriate propertythe issue is that of fair
compensation.
Mr. Irwin: I agree, but that will be very difficult. Hickenlooper is
an emotional name. It would be better to take action on a policy basis
378-376/428-S/80023
November 5, 1970December 31, 1972 525
rather than on the basis of the Hickenlooper Amendment. You have a
difficult psychological situation in Latin America.
Mr. Selden: Possibly we should look at Option 2, where we would
not invoke Hickenlooper until the six-month period ran out.
Mr. Irwin: I dont feel strongly about this. If we had to decide
today, I would go to Option 3. But it may develop that the best thing to
do would be to do nothing. Why do we have to make a flat decision
now?
Mr. Kissinger: When else will we make it?
Mr. Selden: We could begin to do some things in a non-overt way.
Mr. Kissinger: The first decision we have to make is whether or not
we warn Chile.
Mr. Shakespeare: Is it possible to be tough without saying any-
thing about Hickenlooper? Could we stall on some things and take
some other actions? Could we threaten in more subtle ways than with
Hickenlooper?
Mr. Kissinger: We have two choices: to threaten them with Hicken-
looper or say that we will apply the sanctions available to us.
Mr. Crimmins: If we take this decision now, we should recognize
that the fat is in the fire and we will have a confrontation now.
Mr. Kissinger: Why?
Mr. Crimmins: The Chileans will react very strongly to the warning/
threatening approach.
Mr. Kissinger: If we dont do it now, we would expect a confronta-
tion in six months.
Mr. Crimmins: Yes, but under Option 3 and parts of Option 2 we
would have prepared the ground for confrontation by demonstrating
that we had been reasonable and had tried to work out something. We
would be on the best possible grounds.
Mr. Kissinger: Why not tell them now that we will be reasonable
for six months. In October we were told there might be some misappre-
hension on their part, but it was the White House that wouldnt go
along. We should remove any misapprehension.
Mr. Irwin: We cant assume that they know our laws. We should
give them some warning, but I would play it on the soft side; make it
clear to them, but be careful about the words we use.
Mr. Kissinger: I dont object to a formulation that would say we are
prepared to negotiate but point out that, if no solution is found within
six months, we will be required under our laws to do certain things.
Mr. Irwin: Should we wait until they take over a particular
company?
Mr. Kissinger: Do they have to pass implementing legislation?
378-376/428-S/80023
526 Foreign Relations, 19691976, Volume XXI
Mr. Crimmins: This is in the form of a Constitutional amendment
which has to be approved by the Congress. It can be done in 60 days but
it can be strung out. The prospect for significant changes in the lan-
guage, however, are slim, and on some points non-existent.
Mr. Kissinger: Then what is there to negotiate?
Mr. Crimmins: Even if the Constitutional amendment is passed as
written, there are some uncertainties in the language. For example, it
mentions payments in kind. Kennecott might be interested if repay-
ment were in some form of copper.
Mr. Kissinger: Why not let the companies do the negotiating? We
could point out what the consequences would be.
Mr. Crimmins: I personally find this congenial. We might include
in any communication to the government the suggestion that the gov-
ernment listen to the companies.
Mr. Kissinger: I hate to have the US Government a party to the ne-
gotiations if we can avoid it.
Mr. Irwin: I agree. Of course, there might be some things the US
could do during the six months that would be helpful. Possibly some-
thing along the lines of Options 2 or 3.
Mr. Kissinger: I am charged once a week to prevent the SRG from
sliding off the basic line, which is a pretty tough stance toward the
Chilean Government without provoking a confrontation. We do not
want to go in the direction of Peru.
Mr. Selden: Have we any precedent for suspending aid while ne-
gotiating with a country on compensation for expropriation? What
about Peru and Prado; did we suspend aid?
Mr. Crimmins: We have done it for very short periods in various
situations, but never for more than a month.
Mr. Kissinger: In Peru we delayed three months because we didnt
want to take on all of Latin America on the question of expropriation on
a weak case. We would not be willing to do this in Chile unless we re-
ceived some indication that the regime is moving in the other direction.
However, they have taken no single act that is inconsistent with move-
ment, with all deliberate speed, toward a Marxist/Leninist state.
Mr. Shakespeare: But Hickenlooper is the worst ground we can
use.
Mr. Kissinger: Our policy is not to make a fight because they will
take us on only on their terms and on their issues. They wont fight us
until they have destroyed all possible opposition. Our one card is their
reluctance to have a confrontation. Im not crazy about invoking Hick-
enlooper, and we cant decide now on whether or not to do so. This will
have to go to the NSC. (to Mr. Irwin) Will you draft something for an
approach to the Chileans? It should be a moderate stance, indicating
378-376/428-S/80023
November 5, 1970December 31, 1972 527
our readiness to help in the negotiations with the companies, but
warning them that if no satisfactory solution is reached, there are cer-
tain legal requirements which we expect to apply. They should be left
under no misapprehension. Depending on their response, we could
then decide whether or not we want to apply sanctions. Do you all
agree?
All agreed.
Mr. Shakespeare: I would appreciate some advice. If we go down
this route, we shouldnt wait to start building the case that the issue is
fair compensation, not expropriation. We should make it clear that it is
not the right of a nation to control an extractive industry which is in
question, but the right to take over without fair compensation.
Mr. Crimmins: Timing is important, particularly in determining
when the six-month period starts to run. The amendment has not yet
been addressed by the Congress; it may be another two months. It
would be unwise to prejudge the situation until it is actually in process.
Mr. Shakespeare: I agree.
Mr. Kissinger: When should we warn them? Before the amend-
ment is passed or after?
Adm. Moorer: Do we assume it will be passed?
Mr. Crimmins: We should not assume it will be passed as written;
there may be a little flexibility. For example, it calls for the establish-
ment of a special tribunal, actually a kangaroo court, composed of the
Chief Justice and four political appointees. There might be some adjust-
ment in things like this, but it would not be central to the main problem.
We should not be optimistic about making any significant inroads in
the process, but we shouldnt prejudge the outcome. When the time
starts to run, we should undertake the campaign that you (Shake-
speare) describe. We did it in the Peru case. But we shouldnt exag-
gerate its importance, since the issue of compensation is not a big seller
in Latin America.
Mr. Selden: If we limit ourselves to Option 3, I suggest we revise
the next to last sentence to read We would be prepared to relax or in-
tensify these restrictions, etc.
Mr. Kissinger: Should we warn them now or after the law passes?
Mr. Crimmins: Now.
Mr. Irwin: I agree.
Mr. Selden: So do I.
Mr. Kissinger: (to Irwin) Let us have your formula and we will cir-
culate it for consideration by this group.
378-376/428-S/80023
528 Foreign Relations, 19691976, Volume XXI
We have the CIA paper on the implications of Chilean propaganda
and support for guerrilla activities.
6
You do not need any action on
this?
Gen. Cushman: It is purely for information.
Adm. Moorer: We also have an information paper but the Secre-
tary of Defense hasnt yet responded to it, so we will distribute it for in-
formation only. (Original of paper given to Mr. Nachmanoff. Distrib-
uted to SRG members for information on December 24.)
Mr. Shakespeare: How should we play the announcement of the
expropriation? Many of these Latin American countries have weak in-
ternal communications systems and use our material. What should we
do with the announcement? Do you want some commentary?
Mr. Crimmins: I think we respond to questions with the line that
the legislative process is just beginning, that we do not wish to pre-
judge the outcome, and that we will not comment until the situation be-
comes clearer.
Mr. Kissinger: We can say that we dont contest the right of a sov-
ereign state to expropriate but we have the right of a sovereign state to
ask for compensation.
Mr. Crimmins: We might say under international law. That puts
it in more neutral terms rather than in terms of the U.S. Government.
Mr. Shakespeare: Here is a place where we can operate on a two-
track system. We havent done it before, but we can be a shade tougher
over VOA without doing anything formal. We can get across some
signals on fair compensation, citing the attitude of the American people
or the position of the American press. We can use some pretty tough
stuff without associating it with the US Government.
Mr. Kissinger: Not yet. But it might help to say that we dont con-
test the right to expropriate property but we have the right under inter-
national law to ask for fair compensation. We can say that, for the next
60 days, this issue is in the constitutional process.
Mr. Irwin: Our best sources would be Latin American sources. Can
we get some articles in Latin American papers discussing the issue ob-
jectively? USIA could then pick these up in their commentary.
Mr. Shakespeare: Thats a good ideawe could quote Latin Amer-
ican press sources.
6
See Document 191.
378-376/428-S/80023
November 5, 1970December 31, 1972 529
195. Paper Prepared by the Joint Chiefs of Staff
1
Washington, undated.
Preliminary Analysis of Security Implications Regarding the
Establishment of Communist Bases in the Western Hemisphere
NOTE: The term bases is used here in a broad sense; that is, a lo-
cality from which military or quasi-military operations are projected or
supported.
1. Increases in Soviet strategic power and the ability to project that
power have important implications for the security of the Western
Hemisphere. The Soviets have shown an increasing interest in the
hemisphere, as indicated by their expanded efforts to establish diplo-
matic and trade missions and an increase in their naval and air activ-
ities. At this time, the most probable major Soviet requirement would
be for facilities for support of missile-launching submarines. Cuba
could provide such facilities for future Soviet operations in the At-
lantic and the Caribbean area. If Soviet military operations were ex-
tended to the southeastern Pacific, or South Atlantic, support facilities
on the South American Continent would significantly enhance these
operations.
2. For the next few years, Soviet military activity in Latin America,
apart from Cuba, will likely be confined to foot-in-the-door operations;
quasi-military bases for ships and aircraft; port and airfield visits and
military exercises designed to show the flag and to demonstrate sup-
port for sympathetic regimes; military aid and arms sales to supplant
US efforts; scientific facilities to assist in space tracking, navigation, and
communications; and cooperation with friendly Latin American coun-
tries for support of Antarctic operations.
3. A naval support facility capable of supporting Soviet surface
combatants, as well as nuclear submarines, is being constructed at Ci-
enfuegos, Cuba. Since September 1970, Soviet surface combatants and
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H50, SRG Meeting, Chile, 12/23/70. Top Secret; Sensitive.
This paper was prepared for the Senior Review Group. The December 23 covering memo-
randum from Moorer to Kissinger states, There is no current, well-defined U.S. policy
concerning the establishment of communist military bases within the Western Hemi-
sphere. Such a policy could facilitate quick and decisive action by the United States in the
event an attempt is made to establish such bases. (Ibid.) Five days later Moorer wrote to
Laird, U.S. preventive moves [against an increased Soviet presence] should include for-
mulation and announcement of a more definitive national policy designed to deter the es-
tablishment of Soviet military bases in the Western Hemisphere. (Memorandum for the
Secretary of Defense, December 28; ibid., RG 218, 920029, Box 105, Admiral Moorer
Papers, Admin (AC) CMS [Chairmans Memos])
378-376/428-S/80023
530 Foreign Relations, 19691976, Volume XXI
support ships have periodically visited the facility, and work on the fa-
cility continues although at a slower pace. Should the Soviets choose to
use the facility, such use would approximately double the patrol time
of their submarines off the Atlantic coast. If the United States continues
to exert pressure against Soviet submarine support facilities, it is un-
likely that the Soviets will seek to utilize Cuba as a base except to sup-
port their fleet visits and exercises in the Caribbean and to support their
long-range reconnaissance aircraft.
4. A number of recent developments in Latin America give rise to
concern that significant changes in hemispheric political orientation
and power relationships are developing. Recent examples include the
emergence of a strongly nationalistic and leftist-leaning (though not
Communist) government in Peru, Bolivias inclination to the left, and
most importantly the inauguration of an avowed Marxist, Salvador Al-
lende, as President of Chile. In the latter case, Allende is moving rap-
idly against little opposition to transform Chile into a Marxist-socialist
state. He has recognized Cuba and is expected to recognize other Com-
munist states. There are also unconfirmed reports of plans for the estab-
lishment of a Soviet commercial shipping arrangement which would
include providing Chile with merchant vessels and a Soviet-manned
merchant marine facility in Valparaiso, and such a facility could easily
support combatants and [formalize?] the support base for Soviet opera-
tions in the southeastern Pacific. Commercial air routes involving
Chile, Peru, the Soviet Union, and Eastern Europe are also under con-
sideration. Better relations with Communist nations will likely lead to
development of Chile as a base of support for intelligence, subversive
and insurgent activities which would constitute a danger to the
hemisphere.
5. Soviet establishment or use of military bases in the Western
Hemisphere would have serious security implications for the United
States to include:
a. Significant improvement of the Soviet submarine launched mis-
sile capability through simplified submarine support and increased on
station time.
b. Increased Soviet capability to [interdict?] lines of communica-
tion, particularly the strategic Panama Canal and Cape Horn routes,
e.g., CVAs and supertankers are too large to transit the Canal.
c. Increased Soviet capability to interdict the flowof strategic mate-
rials from Latin America to the United States.
d. Increased capabilities for Soviet support of subversion and in-
surgent activities.
e. Increased Soviet intelligence collecting capability to include re-
connaissance, COMINT, HUMINT and monitoring space events, satel-
lite activities and missile testing.
378-376/428-S/80023
November 5, 1970December 31, 1972 531
f. Increased Soviet military influence in the subject country at the
expense of US military influence.
g. Extension of Soviet military assistance to the subject country in-
cluding the establishment of a training and advisory group.
h. Expanded communications facilities for Soviet command and
control.
i. Increased hemispheric instability generated by an arms race or
conflict.
j. Impairment leading to possible disintegration of hemispheric se-
curity arrangements.
k. Increased Soviet capability to support the establishment and
maintenance of Communist governments in Latin America.
l. Increased Soviet bargaining power vis-a`-vis United States secu-
rity interests.
6. The formulation and implementation of a US policy to prevent
the establishment of a foreign Communist base in the Western Hemi-
sphere should evaluate the following considerations.
a. There is no general principle or rule of international law which
prohibits a sovereign state frompermitting the establishment of foreign
military or quasi-military bases on its soil. However, treaties or agree-
ments may prohibit or limit the unilateral exercise of sovereignty by a
state in this respect.
b. US policy in this area has been based traditionally on the prin-
ciple of the Monroe Doctrine. The legitimacy of the unilateral applica-
tion of the doctrine has been eroded both by events and a significant
number of inter-American agreements to which the United States is a
signatory. Nevertheless, it stands as a reminder to other states that for-
eign intervention in the hemisphere, in matters affecting US national
security, is unacceptable.
c. The unilateral enunciation of a US policy against establishment
of Communist bases in the Western Hemisphere could be construed as
intervention in the internal affairs of the UN and the Organization of
American States (OAS). Nevertheless, the 1968 Treaty of Tlatelolco, to
which many Latin American countries are parties, prohibits the posses-
sion of nuclear weapons in the territories of the parties and the estab-
lishment of a foreign military base with nuclear capability. Cuba is not
a party to the treaty. Chile signed the treaty but has not yet ratified it.
The establishment of bases, particularly with a nuclear capability,
would endanger the peace of America within the meaning of the Ca-
racas Resolution (No. 93) of 1954
2
and the Punta del Este Resolution of
2
At the OAS Conference in Caracas, Venezuela, in March 1954, Secretary of State
John Foster Dulles persuaded delegates to pass an anti-Communist resolution giving the
United States carte blanche to invade Guatemala to remove the Communist government
of Arbenz. See Foreign Relations, 19521954, Guatemala.
378-376/428-S/80023
532 Foreign Relations, 19691976, Volume XXI
January 1962.
3
The Inter-American Treaty of Reciprocal Assistance (Rio
Treaty 1947) establishes a consultative mechanism to decide on meas-
ures to be taken in cases of extracontinental aggression which might en-
danger the peace of the hemisphere and recognizes the inherent right of
every state to take reasonable and proportionate measures to deal with
a threat to its existence. The OAS provides one vehicle to take such ac-
tion as is necessary, including the use of armed forces, to deal with any
situations which might endanger the peace of America.
7. In light of the potential threat and the lack of a current,
well-defined policy to cope with it, the United States should formulate
such a policy. The policy with implementing courses of action should
be designed to prevent the establishment of foreign Communist bases
in the Western Hemisphere. Implementing courses of action should in-
clude political, economic, psychological, and military measures. While
such actions should complement and support each other, the political
actions should receive primary emphasis in the early stages. They
should precede other actions as a U.S. warning to both the foreign
Communist government and the subject country government that the
establishment of a Communist base in the Western Hemisphere is un-
acceptable. Since a detailed treatment of political and economic actions
is beyond the scope of this paper, it focuses on military courses of ac-
tion. Such actions, selected on the basis of appropriateness to a partic-
ular situation, could be directed against the subject country or the for-
eign Communist country or both to prevent the establishment of a
Communist base or effect its removal. The desired means for applying
military force in the Western Hemisphere would be under the auspices
of the OAS. Failing this, force should be applied by some other multi-
lateral arrangement; and unilaterally only as a last resort.
3
See footnote 4, Document 183.
378-376/428-S/80023
November 5, 1970December 31, 1972 533
196. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, December 28, 1970.
SUBJECT
IDB Loans to Chilean Universities
In accordance with the policy direction you set forth in the NSC
meeting on Chile on November 6,
2
U.S. representatives in the interna-
tional financial institutions have used their influence in a non-overt
way to delay consideration of new credits for Chile. In the Inter-
American Development Bank (IDB), consideration of two pending
loans (totaling $11 million) for two private Catholic universities in
Chile has been delayed.
On December 21, however, the Chilean Finance Minister formally
gave the IDB assurance that his government would provide its local
cost contribution to the loans, and requested approval of the loans by
the end of this year. The Chilean Governments commitment to put up
its contribution removed the last possible technical objection to consid-
eration of the loans, and the U.S. Executive Director will be forced to
vote on it soon. Since these loans would be from the Fund for Special
Operations, where we have veto power, a positive U.S. vote is required
for approval. Our Executive Director blocked the loans in the IDB
Board meeting on December 24 by indicating he is uninstructed, but
he believes that if he takes an uninstructed position in the Board
meeting next month it will be clearly seen as an overt U.S. political posi-
tion against the two loans to Chile.
The NSC Senior Review Group considered this question at its
meeting on December 23, and agreed that our overall interests would
be best served by approval of the two university loans at the next IDB
Board meeting on January 7.
3
The Review Group based its decision on
the following factors:
Loans for two private Catholic universities, which had been ne-
gotiated with the previous Chilean government, would not be the best
grounds on which to take a public posture of hostility toward the Al-
lende Government; U.S. opposition to the loans would give Allende an
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H50, SRG Meeting, Chile, 12/23/70. Secret. Sent for informa-
tion. A stamped notation on the memorandum indicates the President saw it. A hand-
written notation reads, Notify Nachmanoff.
2
See Document 173.
3
See Document 194.
378-376/428-S/80023
534 Foreign Relations, 19691976, Volume XXI
opportunity to charge us with economic aggression and gain support
in Chile and Latin America.
These loans will not provide any significant help to the Chilean
economy.
The IDB loans will help the two universities to remain inde-
pendent of GOC control; our Embassy and CIA note that although
there is some leftist influence in the Catholic University of Santiago, it
increasingly is becoming an intellectual center for the anti-Allende
wing of the Christian Democratic Party. (Catholic leaders in this
country have urged U.S. support for the loans.)
We can make clear to the financial community that the univer-
sity loans are a special case and do not signify a go-ahead for other
economic credits; in fact, approval of these loans may make it easier for
us to take a harder stand later on loans which are more significant
economically.
The NSCReview Group recognized that careful consultations with
the Congress are necessary to explain the reasons for our position on
these loans, particularly in view of the expected copper expropriations
and the fact that the IDB Replenishment Bill is still pending. However,
the consensus of the agencies, including Treasury, is that our position
could be justified to the Congress. Therefore, unless you object, the Re-
view Group will authorize our Executive Director of the IDB to vote in
favor of the two university loans at the next IDB Board meeting, and
State and Treasury will undertake appropriate consultations on the
Hill.
4
4
At the end of the memorandum, Nixon wrote, OK. Kissinger informed the SRG
in a January 6, 1971, memorandum of the Presidents decision and sent a copy of the
memorandumto the Director of USIA. Kissinger stated that the Departments of State and
Treasury would make it clear to the international financial agencies, other countries, and
the business community, that the United States regarded these university loans as a spe-
cial case and that they did not signify any change in the generally restrictive position that
the United States maintained toward economic credits for Chile. The State and Treasury
Departments also would conduct careful consultations with appropriate congressional
leaders to explain the reasons for the decision. (Ibid.) In a January 12 memorandum to
Kissinger, Nachmanoff noted that the Treasury Department consulted with key Con-
gressmen and there seemed to be considerable understanding. Moreover, the adverse re-
action on the Hill would be tolerable. (National Archives, Nixon Presidential Materials,
NSC Files, NSC Institutional Files (H-Files), Box H171, NSSM 93)
378-376/428-S/80023
November 5, 1970December 31, 1972 535
197. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, January 2, 1971.
SUBJECT
Chilean Copper
In the discussion on U.S. policy toward Chile in a recent NSC
meeting,
2
you directed that General Lincoln prepare a study on pos-
sible developments in world copper markets and U.S. stockpile dis-
posal actions as they may affect the marketing of Chilean copper. Gen-
eral Lincolns response (Tab A)
3
and the NSC staff review indicate:
The world market price of copper has fallen sharply in recent
months and may remain at lower levels for a considerable period.
Copper was selling for 80 cents a pound in April 1970 but is now down
to less than 50 cents a pound. Excess capacity in the free worlds copper
mines will probably tend to hold copper prices down for the next sev-
eral years. Excess supply on the world market has already led to the ac-
cumulation in private hands of stockpiles in Britain and Belgium total-
ling 380,000 tons, a total amount more than 50% greater than the U.S.
stockpile.
Since Chilean copper exports generate about 80% of Chiles total
foreign exchange earnings, the decline in the world copper price has
had and will continue to have a substantial adverse impact on the
Chilean economy.
The U.S. stockpile of copper is 250,000 tons. Initial findings of
the stockpile analysis suggest that copper need not be retained in the
stockpile for national security purposes. However, Congressional au-
thorization is necessary before this copper can be disposed of.
Disposal of the U.S. copper stockpile would bring about a tem-
porary further softening of copper prices. It is difficult to estimate the
effect of this disposal on the world market price of copper; but the fact
that the American stockpile is only about 3% of annual world produc-
tion indicates that the effect on the market price would not be substan-
tial or long-lasting.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Top Secret. Sent for information. A stamped
notation on the memorandum indicates the President saw it.
2
See Document 173.
3
Dated November 13, attached but not printed.
378-376/428-S/80023
536 Foreign Relations, 19691976, Volume XXI
Any softening of the world copper price caused by disposal of
the U.S. copper stockpile would affect those countries that rely on ex-
ports of copper for foreign exchange earningsprimarily Chile,
Zambia, Congo (Kinshasa), and Peru and secondarily Canada, South
Africa, and the Philippines.
Several considerations seem to argue that disposal of the U.S.
copper stockpile would not be an effective or desirable instrument with
which to affect the Chilean economy:
1. Immediate or near-term disposal of the U.S. copper stockpile
would not be possible because of the need to obtain prior Congres-
sional authorization.
2. Disposal of the stockpile would not have a significant lasting ef-
fect on Chiles export earnings.
3. Other exporters of copper would be hurt along with Chile by
any fall in the world copper price caused by U.S. disposal of the copper
stockpile.
4. Disposal of the U.S. stockpile might well cause exporting coun-
tries to blame the United States for the low level of copper prices, which
has in fact been brought about by market forces unrelated to U.S. stock-
pile policy.
We are looking into other possible approaches involving Chilean
copper exports. The U.S. now buys about 15% of Chiles annual exports
of copper, and vessels under contract to U.S. copper-producing com-
panies carry a substantial quantity of Chiles exports. The complexities
of the world copper market and the arrangements involved in produc-
tion and shipping are such that the feasibility of possible U.S. actions to
affect production, shipping and purchase of Chilean copper can be de-
termined only after detailed study. These possibilities are now being
examined in depth to determine whether they might offer opportu-
nities for effective action by the U.S. should we wish to take some ac-
tion to affect the Chilean economy.
378-376/428-S/80023
November 5, 1970December 31, 1972 537
198. Backchannel Message From the Ambassador to Chile (Korry)
to the Under Secretary of State for Political Affairs (Johnson)
and the Presidents Assistant for National Security Affairs
(Kissinger)
1
Santiago, January 21, 1971.
1. Santiago EmbTel 343
2
of this date provides all the pertinent
background material on the April senatorial race. This message fur-
nishes additional material inappropriate for the other channel.
2. I have been approached during the past fortnight directly or in-
directly by most of the key decision makers in the PDC and PN in-
volved in the senate contest. In sum, the Nacional Party wished me to
intervene with Frei to force the PDC to support an independent or
Radical Party dissident (PDR) who would be the anti-Marxist common
standard-bearer. Aside from protesting that I could not convince Frei, I
pointed out to them the pitfalls of such a strategy (the possible defec-
tion of PDC senators to the UP thus providing Allende with a crucial
majority in the upper house and the practical problems of eliciting 5000
petitioners in little more than a fortnight at huge expense). Also the pre-
mature public declarations made earlier in the month by National Party
leader Jarpa and by the PDR calling for a common front with the PDC
against the UP had produced the inevitable reaction against the right
within the PDC. This maladroitness combined with the last minute loss
of euphoria by Jarpa following his return form the US obviated any
chance, in my judgment, of the kind of deal they desired.
3. Meanwhile Zaldivar and other Frei cohorts have been reporting
on their outlook. After hearing all the pros and cons I responded forth-
rightly and personally to Zaldivars appeal for an honest opinion last
Wednesday.
3
Since he obviously wished to run, I encouraged him for
all the reasons given in the RefTel and because I was and am persuaded
that if a single outside candidate could not be agreed upon, as was
the case, then the greatest combined number of opposition votes was
the next best alternative. My feeling after studying the charts was that
Zaldivar would make the best run of any PDC candidate in the area. I
felt too that there was a reasonable chance that Silvia Alessandri might
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret; Sensitive; Eyes Only. Forwarded to
Kissinger with a note from Haig stating that Nachmanoff would include the issue on the
agenda of the next 40 Committee meeting. (Ibid.)
2
Telegram 343 from Santiago, January 20. (Ibid., RG 59, Central Files 197073, POL
14 CHILE)
3
January 13.
378-376/428-S/80023
538 Foreign Relations, 19691976, Volume XXI
withdraw in favor of Zaldivar while a weak PDC candidate would
have disastrous impact on the mood and direction of the PDC, shoving
it towards and reinforcing the UP. I inquired of Zaldivar if he had
spoken to Jorge Alessandri since I felt that the latters views might be
critical for Zaldivars own difficult decision. I was surprised to discover
that he had never met the old man but he said he would seek a meeting
Monday (of this week) prior to his decision.
4. Today Silvia Alessandri came unannounced to my office
(walking up the four flights that separate me from her uncles office in
the same building). She wished to know if she should cede to Zaldivar
or not. My questions elicited the essential knowledge that Zaldivar had
met with her Monday of this week to appeal for her withdrawal just
prior to February 24th. (With instructions to her followers to vote their
consciences.) That she personally did not wish to run, that she would
prefer to concentrate her partisan efforts in the municipal elections in
her own Santiago where she has a strong following, that Jorge Ales-
sandri was very opposed to her senatorial candidacy and that she was
persuaded she would finish third to Sepulveda (first) and Zaldivar if
she were to run. Without taking any stand that could once again per-
suade the Nacionales that we are really all card-carrying PDCers at
heart (as they became convinced in 196367) or that could hurt the ami-
able relations I have been developing with Jarpa, I asked a series of
questions the purposes of which were to reinforce her own hesitations
and to plant the notion that if the PDC and PN were to divide their
labors, with Zaldivar concentrating on the senate race and the PN on
the municipalities, both human and material resources would be at
their maximum efficiency. The material resource euphemism was not
pursued but I am certain that she had her own clear interpretation. She
may well pursue it next week when I see her at her request but I will
stay clear of that subject and its ramifications, leaving it to others to
handle.
5. [7 lines not declassified]
6. An essential factor in the eventual decision that the PN must
make in the next three weeks about Silvia Alessandri is the attitude of
the PDR, whose best known current member, Senator Raul Morales (of
recent supreme court decision notoriety), has quite an impressive fol-
lowing in his district which Zaldivar is presenting himself. If the PDR
[less than 1 line not declassified] were to throw its weight to Zaldivar, the
PN, I reckon, would not insist on its own candidate since it recognizes
that the PDR would be a very significant defection. Incidentally, Ana-
conda has had special relations with Senator Morales for many years
and the factors involved in the Chilean calculus, including the copper
bill before the Congress, could be affected together with the election if
the company were to play its hand skillfully.
378-376/428-S/80023
November 5, 1970December 31, 1972 539
7. To the extent that we can, I would prefer, and am seeking, to
force the difficult decisions back on the Chileans themselves, be it
copper or elections. Only if they reach their own decisions in their own
interests will they feel responsible for the consequences of their own ac-
tions. [1 lines not declassified]
8. [1 lines not declassified]
199. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, January 26, 1971.
SUBJECT
Export-Import Bank Operations in Chile
Attached at Tab A is an information memorandum to the Senior
Review Group from the Acting Chairman of the Ad Hoc Inter-Agency
Working Group on Chile,
2
concerning our policy with respect to
Export-Import Bank operations in Chile. A specific case will come up at
the end of January when the Pacific Steel Company (CAP) is expected
to approach the Ex-Im Bank for new loans totalling $90 million for fur-
ther development of iron ore resources and productive facilities in
Chile. At the same time, CAP is expected to seek the drawdown of the
$18.5 million balance of an existing $25 million bank loan to the CAP.
The Bank will discourage CAP from applying for new loans and,
should it do so, will hold in abeyance and take no action on any appli-
cations the CAP might make. The Bank does not perceive any legal way
to avoid letting CAP drawdown the $18.5 million balance of the present
loan and will concur in this request.
I believe this decision is consistent with our overall policy of not
making any new EXIM loans, but meeting our commitments under
existing agreements if non-overt delays are not possible.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret; Nodis. Sent for information.
2
Dated January 19, attached but not printed.
378-376/428-S/80023
540 Foreign Relations, 19691976, Volume XXI
200. Memorandum for the 40 Committee
1
Washington, January 28, 1971.
SUBJECT
Financial Support of Chilean Opposition Parties for the April 1971 Elections and
the Purchase of Media Outlets
I. Summary
This memorandum proposes that the political opposition to the
Allende governmentNational Party (PN), Christian Democratic
Party (PDC), and Democratic Radical Party (PDR)be funded in the
amount of $1,240,000. Of this amount, [dollar amount not declassified] will
be used by these parties to purchase radio stations and newspapers,
and [dollar amount not declassified] will be used to support their candi-
dates in the 4 April municipal elections and in a key senatorial election
for the seat vacated by President Allende. It is expected that this sup-
port will help bolster the political opposition to the Allende gov-
ernment and slow down Allendes progress in establishing a totalita-
rian Marxist state in Chile. These goals are consistent with the
objectives set forth in the Central Intelligence Agencys Covert Action
Annex to Options Paper on Chile (NSSM 97).
2
II. Background
The victory of Marxist Salvador Allende and the Popular Front
(UP) in the 1970 presidential election has brought to power in Chile a
government whose platform calls for the creation of a centralized
Marxist state, the sharp diminution of U.S. influence in the country, the
initiation of close political and commercial ties with Communist coun-
tries, and the elimination of what is regarded as U.S. hegemony in the
hemisphere. An unstated but key goal of the Allende regime is the
perpetuation of Marxist political power in Chile. The pace at which Al-
lende moves toward construction of a Marxist state is contingent upon
several factors, including the degree to which he can establish personal
control over the diverse and occasionally opposing factions within the
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172, 40 Committee Files. Secret; Sensitive; Eyes Only. A notation at the bottom of the
first page reads, Approved at the 40 Committee meeting held Thursday, 28 January
1971. The memorandum is attached to a January 28 memorandum from Nachmanoff to
Kissinger that summarizes the Central Intelligence Agencys proposals. Nachmanoff ad-
vised, If you are not satisfied that the discussion in the 40 Committee has adequately
covered all of the issues, you may wish to focus only on the two items that require imme-
diate decisionthe [dollar amount not declassified] to support Zaldivar, and the [less than 1
line not declassified].
2
Document 166.
378-376/428-S/80023
November 5, 1970December 31, 1972 541
UP and the success of his efforts to neutralize or gain the support of the
Chilean Armed Forces. In addition, and most importantly, his pace will
be determined by the strength and cohesiveness of the opposition
parties.
Political opposition to Allende and the UP is taking shape, but as
yet it is neither united nor effective. The development of real opposi-
tion in terms of potential for restraining or overthrowing the GOC
will probably depend on significant economic deterioration and/or a
breakdown of public order.
The principal parties opposed to Allende and the UP are the PDC
and the PN. They are not likely to form a united opposition to Allende,
but may be induced to cooperate in some degree. The PN has regarded
the PDC with extreme hostility since the 1964 presidential election,
when the forces which now comprise the PN supported PDC candidate
Eduardo Frei. The Frei government later undertook programs and ac-
tions which the PN considered detrimental to its interests. The PDC in
turn believes that an open alliance with PN rightist forces would be po-
litical suicide.
The PDC is the largest political party in Chile and is potentially the
most significant opposition force. The party is now divided between a
left-wing faction, which favors accommodation and cooperation with
the UP, and a center faction under former President Frei. The latter now
appears to be gaining internal strength and is reportedly adopting a
stronger stance in opposition to the UP. The PN also has potential as an
opposition force. It is the second largest political party in Congress and
represents the interests of landowners, small businessmen, and parts of
the middle class which are not attracted to the PDC. While its possi-
bility for additional growth is limited by its image as a conservative
or even reactionary party, its interests and ideology are directly op-
posed to those of the UP and it can be strident and vocal in defending
them. A third political party, the PDR, represents the conservative
wing of the Radical Party which split from its parent party and sup-
ported Alessandri rather than Allende in the recent presidential elec-
tion. The PDR thus represents a protest against current Radical Party
participation in the UP and can be used to undercut Radical Party
voting strength and to add to opposition effectiveness in Congress.
The Chilean Armed Forces, which have an apolitical tradition,
have largely accepted Allende and are cooperating with his gov-
ernment. The Schneider assassination was a demoralizing develop-
ment for the military and effectively braked whatever sentiment was
developing for military action against Allende. The Armed Forces po-
tential as an opposition or even as a restraining force is related to the
continued existence of viable and vocal political opposition to Allende
and the UP. The Chilean military probably would not oppose Allende
378-376/428-S/80023
542 Foreign Relations, 19691976, Volume XXI
or, if developments should so dictate, plot his overthrow unless it were
ignited by a political opposition force with strong civilian support.
The municipal elections to be held on 4 April 1971 have a funda-
mental importance for the future of the country. In a speech to the first
UP National Assembly on 8 January, Allende insisted that the munic-
ipal elections will not be a plebiscite on his government but simulta-
neously urged UP parties to work out compensation pacts (under
which parties join forces behind a single partys list) to avoid disper-
sion of votes. The real UP goal was stated by Communist Party
spokesman Volodia Teitelboim, who hoped the vote would make it
clear that an absolute majority of citizens are for change. Although
Allende is playing it safe in insisting that the election is not a plebiscite,
there is no doubt that a massive UP electoral victory will have signifi-
cant repercussions not only in Chile but throughout Latin America.
Allende obtained 36.3% of the vote in the presidential election.
This is a relatively small percentage considering that the three major
parties which supported himCommunists, Socialists and Radicals
each has a constituency of about 15% of the national vote. What hap-
pened was that he received all of the Communist and Socialist Party
votes but that a majority of the Radical voters opted for Allessandri. In
the upcoming municipal elections, most Radicals will probably vote for
regular Radical Party candidates, and thus Allende could come out of
the municipal elections claiming 45% of the vote without picking up a
single new supporter. When one considers Allendes superb political
performance during the first two months of his administration, and the
speed and effectiveness with which the UP has moved to implement
the most popular aspects of its program, it becomes obvious that the
UP goal of a popular electoral majority may be achieved in the April
elections. Such a victory could encourage nascent popular unity move-
ments elsewhere in the hemisphere as well as disheartening opposition
and institutional forces inside Chile. This prospect makes it extremely
important for opposition parties to make a vigorous effort in these elec-
tions to help maintain the morale of their supporters, evidence party vi-
tality, and strengthen those factions within their respective parties
which are willing to make a united effort to maintain democratic
freedom.
PDCcandidate Andres Zaldivar, Freis former Minister of Finance,
has a chance of winning a separate election to fill Allendes Senate seat,
provided rival PN candidate Sylvia Alessandri can be persuaded to
withdraw. A PDC victory in this senatorial election would provide a
psychological uplift for Allendes opposition and would help offset a
UP victory in the municipal elections. Proposed financial support to the
PN and the PDC may provide us with the leverage to persuade the two
parties to reach a mutually acceptable electoral compromise. If no com-
378-376/428-S/80023
November 5, 1970December 31, 1972 543
promise is reached, PDC and PN election funds will be used to support
opposing candidatesan unfortunate possibility which we may be un-
able to forestall.
III. Proposals
A. Purchase of Media
Since the presidential election, the UP has gained significant con-
trol over the nations media, both through the acquisition of new
outlets and through intimidation and economic coercion of commercial
radios and newspapers. The opposition is now disadvantaged and
needs to improve its media capability.
The PN has no party newspaper or radio station, and now realizes
that its inability to project party views forcefully and steadily is dimin-
ishing its effectiveness. It can no longer rely on financial contributions
from wealthy businessmen, who fear government reprisals, and thus
needs outside support to enable it to purchase a radio station (Radio
Agricultura) and a newspaper [3 lines not declassified]. The station has
an audience estimated at half a million, with short wave broadcasts
covering the entire country. Terms of the sale are [dollar amount not de-
classified] and the remaining [1 lines not declassified]. The PN is also ob-
taining a printing press [1 lines not declassified]. The price is [dollar
amount not declassified] payable at the time of sale, actually represents
only the value of the building and land, with machinery and equip-
ment being provided without cost [1 lines not declassified].
3
The PN has
also agreed to serve as a funding channel [less than 1 line not declassified]
a small opposition weekly, whose editor will also direct the new daily
[less than 1 line not declassified].
The Frei faction of the PDC has a daily newspaper (La Prensa) and a
radio network in the south of Chile. In order to carry out an effective
political action program, it needs a nationwide radio network to reach
the great mass of the Chilean people. It is negotiating for the purchase
of Radio Cooperativa, which supported Alessandris presidential cam-
paign but is now virtually apolitical and in very shaky financial condi-
tion. The Cooperativa radio chain extends from Antofagasta in the
north to Punta Arenas, the southern tip of Chile. [3 lines not declassified]
The PDC is in debt and cannot rely on contributions from party
members to carry out its program. Sergio Ossa, the personal repre-
sentative of former President Frei, is now traveling in the United States,
Canada, and Europe to raise funds for the Party, but contributions are
3
An additional [dollar amount not declassified] will be needed to help launch the
paper and to keep it afloat until it acquires a substantial readership and advertising.
[Footnote in the original.]
378-376/428-S/80023
544 Foreign Relations, 19691976, Volume XXI
unlikely to be substantial or timely enough to permit prompt acquisi-
tion of Radio Cooperativa.
The PDR is a relatively small splinter group, but it provides the
best available means for attracting Radical Party voters who are dissat-
isfied with Party leadership which delivered the PR to the Marxists. In
order to enhance its ability to reach Radical Party voters, the PDR re-
quires financial assistance to enable it to purchase [less than 1 line not de-
classified] a small station in Santiago. [1 lines not declassified] Since [less
than 1 line not declassified] now has no news section, it is free of the leftist
infiltration which characterizes the news sections of other Santiago
radio stations, and its new owners will be able to hire news commen-
tators of their choice. [3 lines not declassified]
In summary, it is requested that the Committee authorize the pur-
chase of the following media outlets as well as the financial support of
two small existing opposition papers which would be funded through
the PN and the PDR.
[table not declassified]
B. Electoral Support
The CIA Station recommended and Ambassador Korry originally
concurred in an election support proposal in the amount of [dollar
amount not declassified]. However, this presentation requests approval
for only [dollar amount not declassified] since that is the limit we believe
can be provided securely and can be utilized effectively by the parties
at this time.
It is proposed that electoral funds be allocated to the opposition
parties as follows:
1. PDC
Zaldivar senatorial campaign [dollar amount not declassified]
Municipal election campaign [dollar amount not declassified]
2. PN [dollar amount not declassified]
3. PDR [dollar amount not declassified]
TOTAL [dollar amount not declassified]
IV. Funding
[4 paragraphs (39 lines) not declassified]
VI. Costs
The estimated cost of this proposal is $1,240,000. Of this sum,
[dollar amount not declassified] for the purchase of media outlets is avail-
able as part of the [dollar amount not declassified] endorsed by The 40
378-376/428-S/80023
November 5, 1970December 31, 1972 545
Committee on 18 November 1970
4
for ongoing and proposed Chile co-
vert action programs.
Additional funds in the amount of [dollar amount not declassified]
have been requested by the PDC to cover ongoing administrative sup-
port to bolster party infrastructure and to fund the purchase of a new
printing press. [2 lines not declassified] Additional funds for the PDC,
and possibly also for other opposition parties, may be the subject of a
future proposal. Ambassador Korry and the Santiago Station are al-
ready on record as favoring such additional support.
VII. Recommendation
It is recommended that The 40 Committee approve this proposal
for $1,240,000 with the understanding that additional funds for the on-
going administrative support of opposition parties may be requested at
a later date.
4
The 40 Committee met on November 19. See Document 184.
201. Memorandum for the Record
1
Washington, January 28, 1970.
SUBJECT
Minutes of the Meeting of the 40 Committee, 28 January 1971
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. John Irwin, Admiral Moorer, and
Mr. Helms
Messrs. Thomas Karamessines, William Broe, Wymberley Coerr, and Arnold
Nachmanoff were also present.
[Omitted here is discussion unrelated to Chile.]
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile, 40
Committee Minutes, 1970. Secret; Eyes Only. Drafted by Chapin on April 14. A copy was
sent to Mitchell, Packard, Johnson, Moorer, and Helms.
378-376/428-S/80023
546 Foreign Relations, 19691976, Volume XXI
ChileFinancial Support of Chilean Opposition Parties for the April 1971
Elections and the Purchase of Media Outlets
Mr. Broe explained the proposals totalling $1,240,000 contained in
the CIA paper dated 28 January 1971.
2
These would provide support to
the political opposition to the Allende governmentNational Party
(PN), Christian Democratic Party (PDC), and Democratic Radical Party
(PDR). The sum of [dollar amount not declassified] would be split among
the three parties to purchase radios, a printing press (for the PN), and
to support Party publications. An additional [dollar amount not declassi-
fied] would be split among the three parties for the electoral campaigns,
with the major portion going to the PDC.
Mr. Mitchell asked for an assessment of the prospects in the mu-
nicipal elections.
Mr. Broe responded that in these elections there are approximately
250 communes and a total of 1,650 candidates. He stated that it is cus-
tomary to vote first for the party, then for the candidate in the party. He
pointed out that the various parties comprising Allendes UP coalition
basically have 45% of the vote to begin with. Because of these factors it
is difficult to be optimistic, but the main objective should be to get out
the greatest possible vote in opposition to the UP.
Mr. Kissinger expressed his disappointment with the election
prospects and recalled that last fall in Committee discussions con-
cerning the Presidential elections and Allendes inauguration, cau-
tionary notes had been sounded against taking certain actions because
there would be additional opportunities in the forthcoming municipal
elections.
Mr. Packard observed that it is important that we do all we can
now.
Mr. Mitchell commented that the elections really seem to come
down to a pro-Allende or anti-Allende vote and that if the three anti-
Allende parties get the most votes then Allende will feel under certain
constraints as to how rapidly and how far he can proceed with his
Marxist program.
Mr. Broe agreed and reiterated that it is most important to get out
the largest possible opposition vote.
Mr. Kissinger asked how probable it is that the Cuban-organized
security service will not learn what we are doing in support of the Al-
lende opposition.
Mr. Broe stated that funding arrangements have been worked out
very carefully [2 lines not declassified].
2
Document 200.
378-376/428-S/80023
November 5, 1970December 31, 1972 547
Mr. Irwin asked [less than 1 line not declassified].
Mr. Karamessines pointed out that the opposition parties have
fund-raising campaigns and that if the proposal is approved for the
purchase and support of the various media outlets, [1 lines not
declassified].
Mr. Broe referred to the senatorial campaign for the Senate seat
vacated by Allende upon his election to the presidency. [4 lines not
declassified]
Mr. Mitchell stated that he thought [6 lines not declassified].
Mr. Kissinger observed that without the [4 lines not declassified].
Mr. Broe stated that it was uncertain [2 lines not declassified].
On this note, the proposals totalling $1,240,000 as outlined in the
CIA paper dated 28 January 1971 were unanimously approved.
Frank M. Chapin
202. Telegram From the Department of State to the Embassy in
Chile
1
Washington, January 30, 1971, 1926Z.
16544. 1. Unless you see serious problems in light of most recently
reported developments in which event you should inform us by return
cable, you should promptly seek appointment with FonMin and tell
him that you are instructed to give him following message. You should
convey message to him orally.
2. Begin quote. As you know, President Nixon has indicated that
U.S. relations with Chile will depend on the actions which the Chilean
Government takes towards the United States and U.S. interests. We
hope these will be normal relations, but we are concerned that the pro-
posed constitutional amendments submitted to the legislature on De-
cember 22, 1970 could raise a number of serious questions. Chilean offi-
cials have told us that we should be careful to communicate with one
another to avoid misunderstandings of one anothers position. There-
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Se-
cret; Immediate; Exdis. Drafted by Fisher and Feldman; approved by Crimmins; and
cleared in draft by Irwin, Selden, Knowles, Nachmanoff, Broe, and Brims. The draft was
first sent for approval from Meyer to Irwin on January 21. (Ibid., INCO COPPER CHILE)
378-376/428-S/80023
548 Foreign Relations, 19691976, Volume XXI
fore, at this time it seems appropriate for the United States Government
to reiterate its position on the question of expropriation.
The United States, of course, recognizes the right of every sover-
eign state to expropriate private property within its territory for a
public purpose, assuming, of course, that the taking of alien property is
not discriminatory or otherwise violative of international law, and pro-
vided that reasonable provision is made for the payment of just com-
pensation. Under established principles of international law, just com-
pensation means compensation that is paid promptly, in an amount
that is adequate, and in a form that is effectively available to the in-
vestor. We are naturally concerned at the proposed amendments,
which do not hold the promise of just compensation and which, more-
over, would abrogate solemn agreements of the GOC with U.S. in-
vestors, some of which were concluded barely a year ago. We had
hoped that the GOC would negotiate equitable settlements with the
companies, and we still hope it will do so.
It is the policy of the United States Government in these situations
to proceed in a constructive spirit with full respect for the sovereign au-
thority of the host government. The United States Government does,
however, have certain responsibilities under its domestic law, of which
I am sure you are aware, as well as under international law, to safe-
guard the interests of U.S. investors. (FYI for Amb. Korry: If FonMin
shows interest in hearing details of domestic law, referred to here, you
should supply them to him. End FYI) Further, in the case of a number
of investments in Chile, the United States Government has a substantial
financial interest of its own under the investment guaranty contracts it
has concluded with the investors with the full knowledge and approval
of the GOC. The Government of Chile should understand that we take
these concerns seriously. We see no need for these problems to become
questions of an inter-governmental character, and we would hope that
they would not develop in a way that would give rise to serious prob-
lems under U.S. as well as international law, adversely affecting the
availability of resources for development. It is the policy of the United
States to encourage its investors to settle disputes with foreign gov-
ernments by direct negotiation. It is my understanding that the com-
panies are prepared to negotiate. If the GOC wishes to do so, it will be
able, I believe, to negotiate equitable, voluntary settlements with the
companies and avoid controversy between our two governments. End
quote.
2
2
Printed from an unsigned copy. On February 1, Korry reported that he had deliv-
ered the demarche as instructed in a meeting with Foreign Minister Almeyda. Almeyda
responded cordially that Korry could report that he had taken note of the U.S. declara-
tion and that he also noted his complete awareness of pertinent provisions in U.S. legis-
lation relevant to nationalization. (Telegram 596 from Santiago, February 1; ibid., INCO
152 CHILE)
378-376/428-S/80023
November 5, 1970December 31, 1972 549
203. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, February 2, 1971.
SUBJECT
Chile Status Report
A. Developments in Chile
Government and Politics
The Popular Unity (UP) Government has moved swiftly to consoli-
date its power, and is neutralizing potential opposition from the
Armed Forces, the press, the Church, the oligarchy, or the opposition
parties. UP strategy has functioned on two levels simultaneously. On
one level Allende has been careful to appear faithful to Chiles demo-
cratic traditions. On another level the UP has engaged in a ruthless
campaign against the political opposition and the wealthy and upper
middle classes whom Allende regards as their allies. Tactics have in-
cluded intimidation, threats of exposure of past indiscretions, and eco-
nomic pressures. The UP has also taken steps to pull itself together in
preparation for the municipal elections in April, and Allende has
shown skill in playing off one faction against another in order to main-
tain his personal control.
The opposition, chiefly the Christian Democrats (PDC), have been
growing firmer in resisting the Allende government after an initial
tendency to lie lowin hopes of an accommodation with Allende, a hope
blasted by Allendes ruthless tactics. A colorless leadership was se-
lected at the Partys convention in December to avoid splitting the
Party prior to the municipal elections, but the anti-Allende forces of
ex-President Frei remain in control of many of the Partys assets in-
cluding its media outlets. While playing the role of loyal opposition in
Congress the PDC is becoming more effective in resisting government
initiatives. Opposition morale has been boosted by the action of the Su-
preme Court in refusing to lift the immunity of a Senator accused of
complicity in the Schneider assassination, and by the decision of the
prestigious paper El Mercurio to go down swinging if need be rather
than surrender to government pressure.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret; Sensitive. Sent for information. A
stamped notation on the memorandum indicates the President saw it. Attached to a
6-page January 19 draft of the memorandum is a memorandum from Houdek to Hewitt
asking Hewitt to try to cut this memo down to 2 or 3 pages. Neither Henry will sign nor
will the President read an info memo of this length. (Ibid.)
378-376/428-S/80023
550 Foreign Relations, 19691976, Volume XXI
The Economy
The Allende government has moved to fulfill its campaign
promises to nationalize major industries and financial institutions.
Major steps taken during the past month include:
A draft constitutional amendment sent to the Congress permit-
ting the nationalization of foreign-owned copper mines.
Pressure on Bethlehem Steel to make arrangements to sell its
iron mining operations to the government.
A decree prohibiting foreign companies from paying salaries or
other compensation in dollars.
A move to nationalize Chilean-owned banks by means of pur-
chasing their shares. Allende has said foreign banks will be national-
ized through direct negotiations.
In other areas the economic policies of the Allende government
have been directed towards squeezing profits and the middleman by
raising prices paid to producers for foodstuffs and other basic com-
modities while holding down prices to consumers through tough price
controls.
Foreign Affairs
The Allende government continues to project a responsible image
and to avoid direct confrontation in its foreign relations, though Al-
lende implied in a recent speech that confrontation with foreign in-
terests was inevitable as government policies are implemented. When
referring expressly to the United States the government has been cir-
cumspect. Foreign Minister Almeyda said that your remarks on Chile
in your press conference and later in your television appearance do
not alter the status of our relations.
2
Chile and Cuba have now exchanged Ambassadors. Chile has rec-
ognized Communist China and announced that consular relations will
soon be established with East Germany. Allende has gone out of his
way to improve relations with other Latin American countries, and es-
pecially Chiles neighbors.
Intelligence and Covert Activities
Allende has given the pro-Cuban MIR a major role in the secu-
rity and intelligence apparatus. He also uses them as his personal
bodyguard.
2
On January 4, President Nixon was interviewed on nationwide TV and radio. For
his remarks on Chile, see Public Papers: Nixon, 1971, p. 12. In his press conference on De-
cember 10, 1970, he did not mention Chile.
378-376/428-S/80023
November 5, 1970December 31, 1972 551
Cuban intelligence advisors are assisting in the reorganization of
Chilean security and intelligence services.
B. US Actions
With respect to US policy we have:
Initiated a re-examination of our entire hemispheric policy in
light of developments in Chile.
3
Completed and are now reviewing a study of ways to expand
contact with Latin American military leaders.
On the diplomatic front we have:
Continued to pass information to other hemisphere countries
and to certain of our allies in Europe and elsewhere.
Followed up consultations with other OAS members to dis-
suade them from following Chiles lead in recognizing Cuba by pro-
viding information on the continuing threat which Cuba poses to the
hemisphere.
On the economic side we have:
Adopted a strategy for reducing, delaying, or terminating AID
commitments to Chile.
Directed that the Ex-Im Bank should selectively reduce its ex-
port guaranties and insurance for Chile, and continued the cut-off of
new Ex-Im Bank loans to Chile.
Continued to stall consideration of loans for Chile in the IDB and
IBRD. You approved the extension of two IBDloans to private, Catholic
universities in Chile as being consistent with your policy of not inter-
rupting people-to-people type programs, and not taking overtly hostile
actions which give Allende an excuse to rally support.
4
We have indi-
cated to the banks, however, that we continue to maintain our restric-
tive outlook on economic credit for Chile.
3
The reference is to NSSM 108, Review of U.S. Policy Toward Latin America, De-
cember 10, 1971. See Foreign Relations, 19691976, vol. E10, Documents on American
Republics, 19691972, Document 32.
4
See Document 196.
378-376/428-S/80023
552 Foreign Relations, 19691976, Volume XXI
204. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, February 2, 1971.
SUBJECT
Message from Ambassador Korry (Santiago 719CAS Channel)
Ambassador Korry has sent you a backchannel Eyes Only message
(Tab B)
2
(1) lamenting the Washington Post story (Tab C)
3
about his
being replaced, and (2) calling your attention to complaints against the
Administration by Anaconda officials in Chile.
Korry notes that he anticipated the leak about his tenure when he
discussed this subject with you several weeks ago.
4
He also comments
that the leak, and the State Departments prepared press guidance (Tab
D)
5
in response to the story damage our negotiating position. He adds
that many in Washington do not understand the significance of what is
happening in Chile.
I assume that you will want to express dismay over the Washington
Post story and give Korry some reassurance. I have included a para-
graph along those general lines in your suggested reply to Korry at Tab
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret; Eyes Only; Outside System. Sent for
action.
2
For the text of Tab B, dated January 29, see Foreign Relations, 19691976, vol. E16,
Documents on Chile, 19691973, Document 48.
3
The attached January 29 article described Allendes opening to the North and
suggested that it appeared to have tempered the misgivings within the Nixon adminis-
tration about the election of a Marxist. The article also noted, In what appears to be a
conciliatory response, the United States is planning to replace its Ambassador in San-
tiago, Edward M. Korry. He has so alienated Allende that there have been no official
dealings between the two men. At one point, it has now been disclosed, the Chilean Presi-
dent was prepared to declare Korry persona non grata. But he was prevailed upon to let
Korry stay and has now received assurances that a replacement will be named soon, pos-
sibly in March. (Marilyn Berger, Overture from Chile Tempers U.S. Fears, Washington
Post, January 29, p. A12)
4
See Document 192.
5
Attached at Tab D is a January 29 press briefing paper stating, The Allende gov-
ernment has never told us of any complaints about Ambassador Korry. I have seen the
press report you refer to but I have no idea where the (persona non grata) rumor started;
to my knowledge, it is entirely without foundation. On the contrary, Ambassador Korry
has had good normal relations with the new Chilean Administration. Now, as you know,
the White House must be the source of information on Ambassadorial appointments; but
I can say that we have not given the Chileans any indication of a new U.S. ambassador.
378-376/428-S/80023
November 5, 1970December 31, 1972 553
A.
6
However, since I do not have the whole picture, you may wish to
modify this paragraph to include some comment on Korrys future
status.
The cable reporting on Anacondas unhappiness is at Tab E.
7
Ana-
conda apparently wants a public statement by the President or Secre-
tary Rogers that the U.S. will react forcefully and Chile will suffer if the
Chilean Government expropriates Anaconda properties without fair
compensation. They believe the GOC has concluded that there is no
real risk of a damaging confrontation with the U.S. over copper and
hence they believe a high level statement is needed to convince the
Chileans that we will react.
In accordance with the decision of the SRG, Korry has made a
demarche to the Chilean Foreign Minister informing him of the U.S. po-
sition with regard to expropriation and of the applicable provisions of
U.S. law should Chile expropriate U.S. properties without fair compen-
sation.
8
There can be no doubt that the Chilean Government is aware of
our position and of the pertinent provisions of our laws. You will also
recall that the SRG agreed that U.S. officials should not comment pub-
licly on the proposed constitutional amendment while it is in the
Chilean legislative process, but in response to questions, should state
our general positioni.e., that we expect that prompt, fair and ade-
quate compensation will be paid for nationalized properties.
I do not believe that any public threats by the President or the Sec-
retary of State, as suggested by the Anaconda officials, would be useful
because:
Application of the Hickenlooper sanctions would not be per-
ceived by the GOC as a serious problem since our aid programs are so
small and their economic position is relatively strong at this time.
Threats would just give the GOC a nationalistic justification for
what they are likely to do anyway; this is one issue where Allende can
only gain support in Chile and Latin Americawitness, the support
the Ecuadoreans received when we publicly applied sanctions in the
tuna boat dispute.
6
Tab A, a draft reply, states, I was dismayed by Washington Post article which can
only serve to damage our position vis-a`-vis the GOC. I share your outrage over the mis-
leading and erroneous personal inferences in that article. I want to assure you that you
continue to have the Presidents and my deep admiration and gratitude for your dedi-
cated service. It went on to note, We are prepared to indicate publicly at the highest
level our general position on expropriation and compensation, but continue to believe
that public threats specifically concerning the pending Chilean constitutional amend-
ment on copper nationalization would be counterproductive at this time. It concludes,
Your perceptive reporting on the situation in Chile has been very helpful.
7
Attached but not printed at Tab E is telegram 550 from Santiago, January 29.
8
See Document 202.
378-376/428-S/80023
554 Foreign Relations, 19691976, Volume XXI
We are likely to lose what little flexibility there may be in the sit-
uation by a public attackwe can and should continue to make the
GOC aware of the consequences of their actions privately.
Thus far, Anaconda has not put a great deal of pressure on the
State Department. I met with Anacondas Washington representative
last week and he seemed to recognize that public threats at this time
would probably do more harm than good to the companys position.
Recommendation: That you approve the message to Korry at Tab A.
9
9
Kissinger did not check either the Approve or Disapprove option and wrote at the
top of the first page of the memorandum, Noncommittal answer. HK. On February 10,
Kissinger approved the following backchannel message to Korry sent the next day: I ap-
preciated receiving the information and comments provided in reftel. I am continuing to
follow the Chile situation closely, and your perceptive reporting has been very helpful. I
will look forward to talking with you about some of the problems you mentioned when
you are next in Washington. In the meantime, you can be sure that I am very conscious of
the concerns you raised. (National Archives, Nixon Presidential Materials, NSC Files,
Box 774, Country Files, Latin America, Chile, Vol. III)
205. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, February 16, 1971.
SUBJECT
Senior Review Group MeetingChile 3:00 p.m. February 17
The purpose of the Senior Review Group meeting Wednesday
should be to (a) get a status report on developments in Chile and ac-
tions taken to implement our policy since the last SRG (b) decide two
issues:
(1) what role the US Government should play in trying to influence
the terms of the copper nationalization
(2) how much of the planned allocation of $7 million credit for FY
1971 should be offered to Chile.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H52, SRG Meetings, 2/17/71. Secret. Sent for information.
Printed from an uninitialed copy.
378-376/428-S/80023
November 5, 1970December 31, 1972 555
DOD may raise a third issuewhether to proceed with delivery of
previously committed M41 tanks, on which we have been stalling.
Copper Nationalization (Options Paper Tabbed)
2
The most significant issue to be discussed is the US Government
role in the copper nationalization situation. You will recall that the SRG
decided on December 23 that the effort to negotiate settlements would
be left primarily to the copper companies, though the US Government
might provide assistance if an appropriate opportunity arises. It was
also decided that the Chilean Government would be advised of our po-
sition on expropriation and compensation, and of relevant require-
ments of US law. (The SRG agreement memorandum and options
paper for the December 23 meeting are at Tab A).
3
The options paper for Wednesdays meeting (Tabbed) reviews de-
velopments since the December 23 SRG meeting. These are principally:
Korrys demarche on February 1 concerning our position on ex-
propriation and compensation, other efforts by Korry to convey our po-
sition to both the Government and opposition leaders, and a strong
speech by Senator Javits which criticized the proposed constitutional
amendment on copper nationalization.
4
approval by the Chilean Senate on February 10 of a modified
version of the proposed constitutional amendment which offers greater
possibilities for flexibility by the GOC.
an impasse in discussions between the GOC and Bethlehem
Steel Company over the terms of a takeover by the GOC of Bethlehem
iron properties in Chile. OPIC (which is liable for insurance on the
Bethlehem investment) and the Embassy are trying to hold off a deci-
sion on Bethlehem which could adversely prejudice the copper
nationalization.
Korry was approached by the Foreign Minister and the Interior
Minister (alledgedly on Allendes behalf) to indicate that the GOC
wants to avoid a dispute over copper and to sound out Korry on how
this might be done. Korry recommends that he be authorized to talk to
Allende and then to explore with both the Government and the copper
companies the possibilities for a settlement. (Cable at Tab B).
5
2
For the text of the February 12 Options Paper prepared by the Ad Hoc Inter-
Agency Working Group on Chile, see Foreign Relations, 19691976, vol. E16, Documents
on Chile, 19691973, Document 51.
3
Attached at Tab A are the options papers prepared for the December 23 SRG
meeting (see Document 194). See Foreign Relations, 19691976, vol. E16, Documents on
Chile, 19691973, Documents 41 and 42.
4
In his speech on February 1 in New York, Javits criticized Chiles plan for expro-
priation of U.S.-owned companies. (Brendan Jones, Chiles Take-Over Plans Hit by
Javits, New York Times, February 2, 1971, p. 49)
5
Attached at Tab B is telegram 768 from Santiago, February 9. The telegram is Doc-
ument 49, Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
556 Foreign Relations, 19691976, Volume XXI
The issues raised by the GOC approach to Korry are (a) should the
USGget more deeply involved nowin trying to achieve fair settlements
between the GOC and the copper companies (b) if so to what extent
and how (c) should Korry approach Allende.
The paper presents three options:
Option Acontinue the relatively passive stance we have been fol-
lowingfurther demarches to the GOC only on our general position on
expropriation and compensation and the likely consequences of expro-
priation actions.
Under this option we would encourage the GOC and the com-
panies to negotiate directly, but not get involved in details. We would
continue efforts to influence the opposition to moderate the copper leg-
islation, and to make investors and the US and Latin American public
more aware of our position on copper expropriation.
Option Bprovide informal but active good offices in support of di-
rect negotiations between the GOC and the copper companies.
Ambassador Korry would be authorized to play the same kind of
broker role he played in the July 1969 copper agreements.
Option Cif GOC/copper company negotiations do not develop,
try to influence the terms of expropriation through direct EmbassyGOC
talks.
This would go beyond demarches on our general position into spe-
cific exploratory discussions of possible measures by the GOC and
their possible consequences.
Three major considerations should be taken into account in assessing
the options:
Their effect on the chances of achieving fair settlements which
avoid a confrontation on the copper issue and prevent the need for
OPIC to pay insurance.
Do they strengthen or weaken our position vis-a`-vis the GOC
and the copper companies if negotiations fail and the GOC proceeds
with an unsatisfactory expropriation?
What implications do they have for other aspects of our policy
e.g., maintaining economic sanctions, building a case against the Al-
lende Government.
Option A gives us least leverage for affecting chances of a settle-
ment, and leaves us most vulnerable to subsequent charges by the GOC
that we did not take every opportunity to try to work out a fair settle-
ment (also to charges by the copper companies that we did not try to
protect them.) On the other hand, it would make us less vulnerable to
charges of interfering, and allows us to retain flexibility in determining
our position later.
378-376/428-S/80023
November 5, 1970December 31, 1972 557
Option C would apply most leverage, but by getting us into the dis-
pute so directly, would force us to take positions now and thus reduce
our flexibility. It would put the GOC in the best position to bargain
with us for concessions in other arease.g. economic sanctions. It
would also make us most vulnerable to GOC charges of interference
and pressure. On the other hand, if settlements are not achieved, we
would be less vulnerable to charges by the companies that we did not
try to protect their interests.
As might be expected, this leaves the middle option. Option B could give
us some ability to influence settlements at what may be an optimum
time, but would not expose us to charges of interference as clearly as
option C would. If the negotiations fail, we could at least indicate that
we made an effort to achieve fair settlements. This option would have
to be carried out with considerable expertise and skill to act as a broker
without allowing the GOC or the companies to pin the responsibility
for failure on the USG.
My own feeling is that we should try option B, though with very
careful monitoring by the SRG of Korrys efforts. The issues involved in
the copper settlements are very complex and technical. This is one area
where Korry has demonstrated his knowledge and ability. If he stays in
the broker role, without exposing the USG too deeply, he may be able
to bring off some reasonable settlements if Allende really wants to
avoid a confrontation on copper. If Allende doesnt want a fair settle-
ment, Option B would at least help us for the record by demonstrating
that we made an effort to be reasonable (Allende could also get some
benefit by claiming that we did not seriously take advantage of the op-
portunity he offered us to suggest fair solutions, but that is probably a
risk worth taking). All of the options refer to the possibility of an approach
to Allende, presumably because it will be difficult to determine how se-
riously the GOC wishes to avoid a confrontation on copper without a
direct discussion with Allende. This assumption may be correct in the
final analysis, but we may be less exposed by pursuing initial contacts
at the Ministerial level until Allende asks to see Korry or until the SRG
agrees that we are at the crunch point.
One implication of approving Option B is that it would require keep-
ing Korry in Santiago long enough to see this throughpossibly 34
months. It is highly unlikely that a successor could soon acquire the
technical knowledge and contacts that Korry has in this area.
FMS Credit for FY 1970 (Options Paper Tabbed)
6
The Chilean Armed Forces submitted a request last March for $7
million in FMS credits, including a C130 transport. The SRGs policy
6
Attached is an undated options paper prepared by the Department of Defense.
The paper is Document 54, ibid.
378-376/428-S/80023
558 Foreign Relations, 19691976, Volume XXI
thus far has been to avoid a negative reply on Chilean requests to pur-
chase aircraft but to defer actions as long as possible. DOD expects the
Chileans to press soon for a decision on FMS credits. The paper presents
three options:
Option 1Offer no FMS credit
Option 2Establish a limited FMS credit on the order of $3 mil-
lion with no acquisition of major items.
Option 3Offer the Chileans the full $7 million FMS credit (or a
part sufficient to provide for major items).
Option 1 would be consistent with our economic approach (i.e., no
new loans) and be less subject to criticism by Congress, the press and
other friendly Latin American countries. It would, however, jeopardize
our relations with the Chilean military and could give the Allende gov-
ernment some justification for turning to Soviet bloc suppliers. Option
3 would have the obverse advantages and disadvantages. Option 2 is a
compromise which attempts to balance our interests in maintaining a
relationship with the Chilean military against the probable criticism by
Congress and other Latin countries. I recommend approval of Option 2.
7
M41 Tanks (Paper to be supplied by DOD at the meeting)
8
The SRG decided in November that we should delay any decision
as to delivery of M41 tanks which have been reconditioned in the
United States under contract with the GOC. DOD may propose that we
go ahead with delivery on the grounds that reconditioning has been
completed and we may be vulnerable to criticism by the GOC for not
meeting our commitment to deliver the tanks.
You may wish to determine whether the GOC has been pressing
for the delivery of the tanks, or whether DOD is just concerned they
will be pressing soon. If they are pressing us, we have no real choice but
to meet our commitment. However, I suspect DOD is more concerned
about getting the tanks off its hands now, rather than be forced to meet
our commitment later, when we may be in a more direct confrontation
situation with Chile and hence subject to more criticism for making the
delivery.
7
In a memorandum to Kissinger written after the February 17 Senior Review
Group meeting, Nachmanoff argued that, to offset the potential criticism of approving
FMS credits for Chile, it might be worth shaving off the planning figure a little to about
$5 million. The cut could be used to demonstrate that we are not just doing business as
usual. Moreover, as long as we keep the program going at a fairly good level, I doubt that
the additional $2 million would buy much more influence with the military. Kissinger
approved the recommendation on February 22. (National Archives, Nixon Presidential
Materials, NSCFiles, Box 774, Country Files, Latin America, Chile, Vol. III) See footnote 2,
Document 206.
8
Attached but not printed is the undated paper, M41 Tanks for Chile, prepared
by the Department of Defense. It is Document 55, Foreign Relations, 19691976, vol. E16,
Documents on Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 559
206. Minutes of a Meeting of the Senior Review Group
1
Washington, February 17, 1971, 3:303:58 p.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger JCS
Lt. Gen. Richard T. Knowles
State
B/Gen. Joseph H. Belser
Under Secretary John N. Irwin*
Mr. U. Alexis Johnson* Justice
Mr. John Crimmins Attorney Gen. John Mitchell*
Mr. John Fisher
OPIC
Defense Mr. Bradford Mills
Mr. David Packard
NSC Staff
Mr. G. Warren Nutter
Mr. Arnold Nachmanoff
Mr. Raymond G. Leddy
Mr. C. Fred Bergsten
CIA Mr. D. Keith Guthrie
Mr. Richard Helms
Mr. William Broe
*Not present at the beginning of the meeting.
SUMMARY OF CONCLUSIONS
1. Copper Nationalization. The State Department will prepare a draft
scenario for an early approach by Ambassador Korry to the Chilean
Government to offer his good offices in support of direct negotiations
between the Chilean Government and the copper companies. The sce-
nario should include the text of a draft instruction to Ambassador
Korry and should outline anticipated developments after the initial ap-
proach is made. The scenario should be designed to insure that the
United States can confine its role to that of intermediary, without be-
coming a party to negotiations.
2. M41 Tanks. The SRG agreed to go forward with delivery of the
remaining M41 tanks already committed to Chile.
3. FMS Credits. Following a discussion of this issue, it was agreed
that a decision on the amount of credit to be allotted to Chile in FY71
would be made by the SRG Chairman.
2
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H52, SRG Meeting, Chile, 2/17/71. Secret; Nodis. The meeting
took place in the White House Situation Room. A copy was sent to Nachmanoff, Ken-
nedy, and Bergsten. All brackets are in the original.
2
In a February 25 memorandum to the members of the Senior Review Group, Kiss-
inger stated, It was agreed, in discussion subsequent to the SRG meeting, that the
United States should establish a FMS credit level for Chile in FY 1971 on the order of $5
million. (Ibid.) See footnote 7, Document 205.
378-376/428-S/80023
560 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger: We have a number of items to discuss today. The
principal one is the copper nationalization, but we also need to talk
about FMS and M41 tanks. I understand that Ambassador Korry has
been approached on Allendes behalf about how to avoid a dispute
over copper nationalization. I dont know how seriously we can take
these approaches.
Mr. Crimmins: These approaches were made to Korry by several
Chilean officials and by the new Chilean Ambassador to the U.S. In ef-
fect, these people have said that the Chilean Government would like to
avoid a confrontation on nationalization and is looking to Korrys par-
ticipation to help make this possible. Up to the present time, the U.S.
Government role, as carried out by the State Department, OPIC, and
Ambassador Korry, has been to coach the companies from the side-
lines. We have emphasized to the Chilean Government that the most
desirable technique for avoiding a confrontation would be for negotia-
tions to take place between the companies and the Chilean Govern-
ment. Korry has indicated that he is ready to assist insofar as this might
be useful.
Dr. Kissinger: Do his judgment and ours coincide on what might
be useful?
Mr. Crimmins: That is a question that has yet to be defined. The na-
ture of a possible role for Korry is what we are addressing today. It
should be noted that he was useful and effective as a mediator in the
1969 dispute between the copper companies and the Chilean Govern-
ment. Of course, the circumstances today are different. In 1969 the
Chilean Government was predisposed to a sensible arrangement. The
current government is not by any means so disposed, and Korrys
standing is not as sure.
Dr. Kissinger: That is a carefully balanced statement.
Mr. Crimmins: As we see it now, the choice is between Options A
& B [of the Ad Hoc Group paper on copper negotiations].
3
C is really a
sequential option; that is, if B is chosen but does not produce results,
then we can consider going to C. It is important to understand the
present position of the Chilean Government, as expounded to Korry by
the cabinet ministers and by Ambassador Letelier. They indicate that
any negotiations with the companies would not begin until after the na-
tionalization legislation is through the Congress. We now estimate this
to be not earlier than mid-April.
In Option B we are therefore talking about a pre-negotiation effort
to determine whether there is any basis for encouraging negotiations
between the companies and the Chilean Government.
3
For a summary of the options presented in the paper, see Document 205. The Op-
tions Paper is Document 51 in Foreign Relations, 19691976, vol. E16, Documents on
Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 561
Dr. Kissinger: What would we do in C that we are not already
doing under B?
Mr. Crimmins: C provides for direct government-to-government
negotiations without the companies.
Dr. Kissinger: If the Chilean Government does not want to talk be-
tween now and the time the law passes, then there is nothing for us to
say to them.
Mr. Crimmins: What we have in mind is a more active exploration
of the flexibility of the Chilean position.
Dr. Kissinger: Wouldnt that make us a party to the negotiations?
Mr. Crimmins: No, we would only be sounding the Chilean
position.
Dr. Kissinger: I understand what Option B says, but if the Chilean
Government is unwilling to talk, what can Korry do?
(Mr. Irwin joined the meeting at this point.)
Between now and April Korry would be the only one doing any
talking.
Mr. Mills: The Bethlehem Steel negotiation is going on now.
Dr. Kissinger: I cant see what Korry can do now.
Mr. Crimmins: He can offer his good offices to arrange
negotiations.
Dr. Kissinger: Wouldnt that be hard to do?
Mr. Crimmins: The Chilean Government would much prefer to
deal with us and leave the companies aside. We, of course, dont want
that.
Dr. Kissinger: Exactly. So we send our Ambassador in to talk to
them.
Mr. Crimmins: In 1969 his role was that of intermediary. He would
again provide his good offices.
Dr. Kissinger: It seems to me that Option B really involves two
choices. Ambassador Korry can go ahead and do what he has pro-
posed. Or he can wait until the law passes and tell the Chilean Govern-
ment then that he is prepared to provide his good offices. Then if they
accept, he can go ahead.
I am afraid that we may find ourselves at the point of carrying out
Option C before we get started on Option B. B could merge insensibly
into C.
We ought to consider having Korry wait to mediate until there are
some negotiations under way.
Mr. Crimmins: The situation has changed since Option B was
drafted. There are now other purposes which more active involvement
by Korry might serve. The principal one is that Korry could attempt to
378-376/428-S/80023
562 Foreign Relations, 19691976, Volume XXI
introduce some measure of moderation and flexibility into the Chilean
Governments position as the nationalization bill continues through
Congress.
Dr. Kissinger: How would he do that?
Mr. Crimmins: He could emphasize the negotiating track and set
forth the requirements for a decent settlement.
Dr. Kissinger: Hasnt he done that already?
Mr. Crimmins: In a general, aloof way. Now he would pursue this
more vigorously.
Dr. Kissinger: What could he say? What is a non-aloof, vigorous
way to be involved?
Mr. Crimmins: The Minister of Interior, who alleges to be speaking
for Allende, has asked Korry how to avoid a confrontation. It is pos-
sible that any discussions might escalate to the level of President Al-
lende. But even leaving aside that possibility, he could pursue the
nibbles he has had from various cabinet members. His purpose would
be to move the thinking of the Chilean Government along a more flex-
ible, moderate path in order to prepare the ground for negotiations be-
tween the Government and the companies. It is conceivable that
Korrys efforts could produce negotiations between the companies and
the Government before the passage of the nationalization legislation by
the Congress. Our purpose would be to induce the Chilean Govern-
ment to introduce modifications in the legislation in order to make sub-
sequent negotiations easier. Korry would continue to work, as he has in
the past, with opposition elements to get them to introduce useful mod-
ifications in the law.
Mr. Irwin: (to Crimmins) Have you discussed the attitude of the
companies?
Mr. Crimmins: They are prepared to negotiate although they are
not sanguine about the results.
Mr. Mills: Cerro was asked to come down but was totally rebuffed.
Dr. Kissinger: We want the companies to negotiate, but we dont
want to get stuck with the outcome and be blamed by both sides. If it is
true that the Chileans want us to do the negotiating, then I dont know
how we can pursue this without ending up being sucked into negotia-
tions. I have trouble visualizing this pre-negotiation effort. What would
Korry do other than say what he is already saying and continue to work
with the opposition?
Mr. Crimmins: I would not foreclose this pre-negotiation effort in-
ducing some movement in the Chilean Government toward modifying
the legislation.
Mr. Irwin: Thats what I would say. However, I agree with Henry
[Kissinger] that we dont want to get stuck with responsibility for the
378-376/428-S/80023
November 5, 1970December 31, 1972 563
negotiations. I think we ought to do what we can to introduce flexibility
into the law.
Dr. Kissinger: If Allende wants to negotiate, why is it not in his in-
terest to have flexibility? What can Korry add to the equation?
Mr. Irwin: It is difficult for me to judge, since I dont know the atti-
tudes of these people. However, Korry could make clear the effect of
our laws and the necessity that the Chileans not adopt laws that limit
their own flexibility. He could also push on negotiations with the
companies.
Mr. Crimmins: He would have to be careful to shy away from as-
suming responsibility for the negotiations. That would be the sine qua
non of any approach. He would have to emphasize this at the time he
made the approach.
Dr. Kissinger: Lets say that Korry goes in and says, We want you
to negotiate with the companies. Having studied the matter, we have
concluded that if you want to negotiate with the companies, you ought
to take care that your legislation gives you the necessary flexibility.
Then Allende says, Thank you. We will take into account what you
say. What happens then?
Mr. Crimmins: Then you could well get a change in the legislation.
Mr. Packard: At this point, the objective is to see whether the legis-
lation can be influenced in some way. It is too soon to determine
whether to negotiate or what we can negotiate.
Dr. Kissinger: Especially when Allende can always change the
rules on negotiations.
Mr. Packard: It would be worthwhile to see if we can influence the
legislation. In the course of doing so, we would seek to keep our op-
tions open.
Mr. Irwin: Exactly.
Dr. Kissinger: Is more involved than one visit by Korry to Allende?
Mr. Crimmins: I wouldnt want to preclude some approximation
of the companies to the Chilean Government. A visit to Allende could
well be preliminary to discussions between the companies and the
Government. Thus, I would not want to say that we make a pitch to Al-
lende and stop there. I would not want to preclude a scenario that
would move the prospects somewhat further.
Mr. Mills: There are two points that are important here. One is that
the legislation wont be ready for a month. The other is that right now
negotiations between Bethlehem Steel and the Chilean Government are
going on. The Chilean Government says these talks will be a prelude to
the copper settlement. Thus, right now is the moment for us to take
action.
378-376/428-S/80023
564 Foreign Relations, 19691976, Volume XXI
Mr. Crimmins: The Bethlehemnegotiations will not necessarily de-
termine what sort of copper settlement can be arranged.
Mr. Mills: As Ambassador Korry just reported today, the Chileans
have announced that the Bethlehem negotiation will be a trailblazer.
Mr. Crimmins: We dont have to view it this way.
Dr. Kissinger: (to Helms) What do you think?
Mr. Helms: I am no expert on howto handle these situations. How-
ever, it seems to me that anything we can do now to keep the Chilean
Governments attitude from hardening would be desirable. I am sym-
pathetic to your [Kissingers] point that we ought to consider carefully
how the dialogue might proceed. Still, it is worth making a try; the situ-
ation can hardly get worse. If the Chileans get what they want in the
Bethlehem negotiations, they will advertise it in neon lights. It might
provide an undesirable precedent.
Mr. Irwin: I cant really say how working out a settlement of the
Bethlehem affair will help in getting desirable changes in the legisla-
tion. A Korry conversation with Allende might be a one-shot affair as
you [Kissinger] say, but it might permit further talks with cabinet min-
isters. Also Korry can continue his efforts with the opposition.
Dr. Kissinger: These certainly do not endear him to Allende.
Mr. Packard: What is the situation with regard to Bethlehem? How
are we involved?
Mr. Mills: We have been working closely with Bethlehem; in fact,
OPIC has been telling them what to do. The original Chilean proposal
was for payment over 20 years at four per cent. Bethlehem countered
with eight years at 6 per cent. Now Bethlehem wants to put forward a
proposal that would call for payment over a period from 8 to 1520
years based on the ability of the Chilean Steel Company (CAP) to con-
sume iron ore. If the Chilean Steel Company will expand its production
as much as its plans call for, then Bethlehem will take a long-term
payout.
Mr. Packard: What about price?
Mr. Mills: They are not down to that yet.
Mr. Crimmins: Depreciated book value is being used. Bethlehem
had a contract with the Chilean Steel Company going back to 1951 pro-
viding for CAP to buy out Bethlehem over a twenty-year period at 4
per cent.
Mr. Packard: In that case, the twenty-years-at-four-per-cent figure
is almost fixed.
Mr. Crimmins: The circumstances are now different. Bethlehem
says the contract is not binding.
Mr. Mills: The contract is subject to interpretation.
378-376/428-S/80023
November 5, 1970December 31, 1972 565
Mr. Packard: If that is the approach Bethlehem is taking, I imagine
it wont come off. They are probably stuck with depreciated book
value, twenty years, and four per cent. But if something could be
worked out within those guidelines . . .
Mr. Crimmins: Bethlehems latest formula could result in a
ten-year payout.
Mr. Mills: This is much better than anything we have seen so far in
the way of a possible settlement.
Mr. Packard: The pending legislation is not likely to affect this.
What is there that we can influence?
Mr. Crimmins: If the Bethlehem negotiations break down, the
chances are that nationalization of the Bethlehem properties will be in-
corporated in the copper bill. The present terms of the legislation pro-
vide for payment over thirty years or less at a rate of at least 3%. This is
a change from the original Allende proposal which set a flat 30 years at
3%. The present legislation has some vague technical points, such as
whether expropriation applies to the assets or to the company (i.e. the
shares).
(Attorney General Mitchell joined the meeting at this point.)
Mr. Packard: What you are really saying is that it is very important
to keep the legislation flexible.
Mr. Mills: We also want to keep pressure on the Bethlehem negoti-
ations to avoid having them set a very adverse precedent.
Mr. Packard: It seems that this is the time that something ought to
be done.
Mr. Irwin: There is not much to lose, except for the risk that you get
in so far that you end up negotiating for the companies. We have to
make clear to Korry that he is not to do this.
Mr. Packard: We need someone down there to handle the game
planning. Is someone else [besides Korry] called for?
Dr. Kissinger: I remember back in October all the things we were
told would happen if we didnt turn Korry loose then. Not one of these
things has happened.
Mr. Crimmins: I wasnt here at that time.
Dr. Kissinger: Korry wanted to go to see Allende one week before
the inauguration. The quid pro quo was going to be our good will.
None of the things that were predicted happened. If someone can write
out exactly what we would have Korry say, it would be helpful.
Mr. Crimmins: Why dont we prepare a draft instruction and cir-
culate it to the principals?
Mr. Packard: It is clear that this is the time for something to be
done.
378-376/428-S/80023
566 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger: This is not just a commercial issue for us.
Mr. Mills: Following the Javits speech
4
and Korrys recent discus-
sions with Chilean officials, we have seen a marked change in the
Chilean attitude.
Dr. Kissinger: The basic issue ever since October has been in whose
interest it is to avoid a confrontation. Is it more in our interest or in his?
If it is not in his interest to avoid a confrontation, then he can have one
anytime he chooses. The basic point is that it may be in his interest to
pretend that he has gone the extra mile in trying to get along with us as
long as there are some opposition elements still in existence. Allende
wants to maneuver us into an adversary position.
The best way to proceed would be for you to tell us exactly what
you want Korry to say to Allende.
Mr. Crimmins: With regard to Allendes motivation, he does have
an interest in preserving his international respectability and access to
international financial institutions, though he would not seek to do so
at any cost. He is not in such a vulnerable position that a cutoff of funds
would be very damaging to him. But if he can on the cheap maintain his
respectability and his access to the international institutions, then he
will try to do so.
Dr. Kissinger: Four months ago I didnt know anything about
Chile. But as an outside student of revolutions, it seems to me that Al-
lendes problem continues to be what it has always been: to delay a con-
frontation with outside groups as long as possible until he can neu-
tralize pro-Western and opposition elements in Chile.
(Mr. Johnson joined the meeting at this point.)
Perhaps he will try to maneuver us into the position of being the
defenders of economic interests. This is the lousiest possible position in
which to be in present-day Latin America. If we were dealing with Frei,
who we could be sure was only interested in driving a hard bargain,
then this issue would not have to come to the White House.
Mr. Crimmins: We have countervailing concerns. We dont want
to take the onus for a confrontation, yet we want to keep pressure on
Allende. We have to thread a path between these two.
Mr. Packard: What alternatives do we have? Is it really in our in-
terest to be tough and force the issue?
Dr. Kissinger: No, we dont want to force it. Our approach could be
to stay aloof, let them pass the nationalization law, offer our good of-
fices when it is passed, and if we meet with no success, apply our own
laws.
4
See footnote 4, Document 205.
378-376/428-S/80023
November 5, 1970December 31, 1972 567
Mr. Packard: There may be some people and forces in Chile we
want to encourage. By doing this, we may cause them to lose hope.
Dr. Kissinger: The problem is that precisely the forces we want to
encourage may be told by Allende: I am dealing with the Americans,
and things are going along nicely. Who are you to scream?
Mr. Packard: On that basis, we would conclude that we should not
deal with Allende but with the opposition in the legislature.
Mr. Crimmins: We have had considerable success with them so far.
Dr. Kissinger: No one objects to dealing with the opposition. The
problem is the danger of getting involved in negotiations with the
Chilean Government.
Mr. Packard: We should not get very involved.
Mr. Crimmins: It is important to remember that there is no Chilean
sentiment opposed to the nationalization of the copper industry.
Dr. Kissinger: That is why we should stay the hell out. We are right
at the point where we were last year when it was proposed to take a
stand on political principle instead of finessing the issue. We run the
risk of winding up in the position of defending an economic interest.
Mr. Packard: We are just being euchred along. We might as well
admit it. But what alternative course do we have?
Dr. Kissinger: The point is that we dont want to let Allende use us
to castrate his opposition in parliament by getting us in the position of
being his chief adversary. He knows exactly what he is doing. He has
run a superlative operation since his inauguration. We can assume he
knows everything that Korry could tell him. If he doesnt do some of
the things [we might warn him against], it is because they dont fit in
with his strategy. (to Crimmins) Do you believe that he is really un-
aware of our concerns?
Mr. Crimmins: Not at all.
Dr. Kissinger: Lets take a look at what you want to have Korry say
to him. Also we ought to have a scenario to show where we might wind
up after making an approach. We want to be sure that we make clear
that we dont want to negotiate.
Mr. Packard: I agree that we do not want to negotiate.
Mr. Irwin: So do I.
Mr. Crimmins: I agree, but if he nationalizes, we will become the
negotiator as a result of the OPIC guarantees.
Mr. Mills: Thats right.
Mr. Nachmanoff: That wont happen for a year.
Mr. Crimmins: We become the subrogees immediately.
Dr. Kissinger: Okay, do a game plan. I think you know what you
are doing and that Allende knows what he is doing. The question is to
find out how it all fits together. Now we can take up the military issues.
378-376/428-S/80023
568 Foreign Relations, 19691976, Volume XXI
(Mr. Mills left the meeting at this point.)
Mr. Packard: We recommend going ahead with the credit and the
tanks in order to keep our channels open to the military.
Dr. Kissinger: Our strategy is to try to be as close to the military as
we can.
Mr. Packard: The trouble is that the military is unwilling to take a
stand. However, by continuing our assistance, we may at least keep the
Russians from coming in.
Dr. Kissinger: (to Packard) You are recommending the full $7
million?
Mr. Packard: Yes.
Mr. Irwin: We concur on the tanks. We dont really object to the $7
million FMS credit, but we feel that if we provide the full amount, it
will look as though we are doing business as usual. Thus, we think it
would be better to set a lower figure, say, $45 million in order to show
that it is not business as usual. Our proposal is to provide the tanks and
$4 million.
Mr. Crimmins: Allende has been handling the military with con-
siderable success; they are essentially inert. There is a risk that he can
use these credits to his own advantage. We can signal that business is
not quite as usual; otherwise, Allende can say to the military: There
are no problems with the U.S. You are getting just what was
programmed.
Mr. Packard: I am assuming that we can get a message to the mili-
tary to counter this. I think we have good enough communications to
deal with this.
Mr. Crimmins: The signals we are receiving all point in the oppo-
site direction. The military say that they are constitutionally minded
and that they are responsive to the will of the electorate.
Mr. Nutter: Back in October we concluded that the military would
respond only if Allende steps down hard on them. I dont know whom
we signal.
Lt. Gen. Knowles: It is hard to split the [proposed FMS] package. If
we took out the C130, we would have the air force fighting with the
army. We would take something of a loss in our relations with the
military.
Mr. Crimmins: Do you really think that the result would be alto-
gether bad? Would there not be some virtue in getting across to the mil-
itary that their approach is not costless?
Mr. Packard: I could see some advantage to that if I thought it
could really be achieved. However, the problem now is to keep the mil-
itary from going elsewhere to get equipment. I would much rather let
them have the C130 than allow that to happen.
378-376/428-S/80023
November 5, 1970December 31, 1972 569
Mr. Crimmins: Would you feel the same way if they came back
and requested F5s?
Dr. Kissinger: I guess I will have to take this to the President.
Mr. Packard: I hate to bother the President with this.
Dr. Kissinger: Would all of you like to think it over some more, and
then we can take a poll tomorrow?
Mr. Irwin: We dont have any strong feelings about this. Let the
Chairman decide it.
Dr. Kissinger: Let me think about it further. (to Irwin and Packard)
Then I will call you tomorrow.
Mr. Leddy: There is a long delivery time on the weapons.
Dr. Kissinger: We will settle this tomorrow.
207. Notes of a Meeting
1
Valparaiso, February 19, 1971, 12:051:15 p.m.
1. PERSONNEL PRESENT FROM U.S.
Admiral E.R. Zumwalt, Jr., USN
Mr. A.I. Selden, DASD (ISA)
Rear Admiral E.H. Tidd, USN
2. PERSONNEL PRESENT FROM CHILE
President Allende
Admiral Montero, Chilean CNO
Rear Admiral Webber
Captain Lopez, plus 4 other members of the Presidents immediate staff (all
military).
3. The meeting came as a surprise and with very little notice during
our scheduled inspection of a Chilean Navy facility in Valparaiso.
2
It
was so short-fused that apparently Admiral Montero did not have con-
firmation of the meeting until the morning tour started. This did not
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Secret.
The meeting took place in the Presidents Office Rotunda. A handwritten notation on the
first page reads: Reconstructed from rough notesnot verbatim.
2
On February 18, Minister of Defense Rios Valdivia met with Zumwalt, Selden, and
an official U.S. party. According to a memorandum recording the meeting, little of sub-
stance was discussed. (Comments Made by Chilean Minister of Defense During Admiral
Zumwalts Call, February 18; ibid.)
378-376/428-S/80023
570 Foreign Relations, 19691976, Volume XXI
provide Admiral Zumwalt an opportunity to alert Ambassador Korry
of the impending meeting.
4. The meeting opened with the usual brief amenities of welcome
and was marked by the most cordial tone by President Allende which
prevailed throughout the meeting. He is a man of great personal
charm, dynamic, charismatic, dramatic in his change of moods from
soft sell to hard and naked statements of intentions.
5. President Allende commented on the condition of his Navy and
alluded to needing the continued services of our Navy Mission. Ad-
miral Zumwalt commented on President Allendes past ties with the
Navy. Allende then stated that the Chilean Navy had suggested it
might be possible for the Enterprise to be available on her way up the
West Coast to stop in Valparaiso. President Allende then stated, It is
not possible, it is necessary. Admiral Montero then explained that this
was an old Chilean joke, to which the President added he would be
most highly pleased with such a visit. It would be a great pleasure to
have Enterprise visit Valparaiso and I would like to go aboard. I know
it is an advanced design and feel that it is important to have the pres-
ence of such U.S. Navy units for the Chileans to see. Admiral Zumwalt
then stated he would send a message to Admiral Moorer before leaving
Chile. (The Chilean CNO later commented that this visit would
strengthen the Chilean military prestige and non-political tradition.)
6. President Allende stated the importance of visits by maximum
numbers of U.S. citizens so that they can get a true feeling of conditions
today in Chile and of the people.
7. Admiral Zumwalt stated the importance for Admiral Zumwalt
and Mr. Selden to come on this trip and see Chile for themselves, so
that they could separate fact from fiction. Admiral Zumwalt stated that
we have a political problem regarding the continuation of economic
and military assistance because of conditions that have been reported
in our press.
8. President Allende said he hoped that all of this type assistance
will continue in the same way as before. He stated that, This country
will never become non-democratic or Sovietized.
9. Admiral Zumwalt stated that this was most valuable news, that
he was sure Allende was aware of previous methods and moves by the
Soviets on gaining control in other countries.
10. President Allende: I am not just telling you this for diplomatic
talk. We have a sense of dignity; we are proud to be small but we are a
nation with dignity. We want our country to be for Chileans. We will
return the wealth to the people. Every day the gap is wider between the
industrialized nations and the undeveloped ones. In Chile there are
people that cannot work the land due to hunger. We must ensure that
every child has milk to drink and enough to eat. I do not want the mili-
378-376/428-S/80023
November 5, 1970December 31, 1972 571
tary to make politics. I want them to understand politics but to stay
professionals. This is why we are happy with your visit.
11. Admiral Zumwalt: I understand what you say you want to ac-
complish for your people. If I may speak frankly about our own polit-
ical situation regarding past aid and Mr. Selden understands this well
with his 16 years in Congress (President Allende interrupted and said,
I have spent 25 years as a senator and understand these things too.).
12. Admiral Zumwalt then continued that he believes the
problems have been caused because there are reports in our news-
papers which carry the statement that the reforms, which every
country has a right to carry out, might be carried out by Chile without
adequate compensation for nationalization of private enterprise.
13. President Allende: (Speaking very seriously) What is their
basis? I do not know how they reach these conclusions because we are
still studying these things ourselves. A country that has had a
Congress for 123 consecutive years (or, since 1923?) how could it fail to
provide fair and just compensation.
14. Admiral Zumwalt: I understand that by the law a British firm
will be used to estimate a fair price for nationalized forms? (Here the
interpreter explained to Admiral Zumwalt that he had misunderstood
a previous conversation with the Minister of Defense and that it had
not been implied that an outside firm would make such an estimate in
the law but perhaps as an initiative by Chile.)
15. President Allende then explained in some detail their congres-
sional procedure and legal appeal procedures for arriving at the prices
in compensation for nationalized firms and stated that if a company
does not agree, they can go to the courts of the land and appeal. We do
not want to create for the U.S. artificial profits nor do we want these
firms free of any arbitrated price.
16. President Allende: We have stated that we are prepared to
provide for U.S. needs for a certain number of tons, 100,000 to 200,000
tons (of copper) and a contract for 20 to 30 years and we guarantee to
provide the supplies needed. We export raw material and import man-
ufactured goods. We cannot continue to be exploited as an underdevel-
oped nation. We intend to develop industry. We import goods from the
U.S. at relatively high prices while the U.S. is paying low prices for our
raw material. We are not making an aggression against your people.
We are defending our responsibility to our country. Do not forget these
numbers: From this country over the past years you have taken 9,400 million
dollars, the equivalent of the entire social capital of Chile. We have allowed
in the past this unfair exploitation. In this, we have permitted $9.4B, the
whole of Chile in terms of its current social capital, to go away. There
are 600,000 children mentally weak because they do not eat enough. In
the past, when I was Minister of Welfare, we were lacking 340,000
378-376/428-S/80023
572 Foreign Relations, 19691976, Volume XXI
teachers, we now lack 440,000 teachers. A country cannot prosper that
does not work hard. Our people need housing, vocations, industry and
agriculture.
17. Admiral Zumwalt stated that it was 100% feasible to support a
nations right to improve these things. The problem the U.S. faces is the
future support of our traditional allies. There will be much importance
attached to working out the nationalization problem in a way that will
motivate other U.S. companies to help Chile further in other fields and
it must be clear that there is no communization or Sovietization of
Chilean institutions if military aid is to continue.
18. President Allende: We are working on all aspects of this and
feel that it can be done. He discussed the interest of the Japanese to
take over the iron ore interests in Northern Chile to process it into
nodules in Chile and then ship it to their islands to manufacture fin-
ished steel. The trouble is that capital is looking for insured and very
high profits. To the North the Americans have earned very high profits
on our copper and have paid very high salaries to Americans here
while not improving the education or pay of their Chilean workers
very much. We are the only country in the world with natural fertilizer.
During World War II the U.S. had a vital interest in these supplies. But
then and since, the benefits to Chile have been inadequate. After 30
years, Chile has taken over this operation. The mines have been nation-
alized. They are in very poor and deplorable condition.
19. Then President Allende led Admiral Zumwalt and Mr. Selden
to a table top scale model for the development of Valparaiso harbor that
contained a number of modern deep water piers, cargo handling equip-
ment, new breakwaters and various harbor developments such as a
modern commercial and naval shipyard, modern highways, a railroad
to Argentina. He stated this is a project for American help. This is a ter-
minal port. It could be used for export. We need quick ways of han-
dling cargo. We need to do it in the shortest time so that ships will stay
in port a minimum of time and reduce the prices. To the North of the
city only poor roads carry 48,000 cars each day. These must be im-
proved. We need to build several railroads from Argentina to Chile.
These railroads can bring out fruit for Argentina. It is 3,0005,000 miles
less than to New York by the Atlantic Ocean. We wish to build these
roads. We will never utilize them for military problems with Argen-
tina. These roads are for the best for all nations. If it is necessary to give
concessions (e.g., free ports) we will do this because it will mean jobs
for people of Chile. (Pointing to the table top model againI want
these facilities for our warships and also for a fishing port for people
fishing by hand. I want to make the port bigger and to protect the ships
from the high winds. I want to open the roads into and out of Valpa-
raiso for visitors. I want to make a jetty for passing over (loading) fruit
378-376/428-S/80023
November 5, 1970December 31, 1972 573
products. What will happen in 1020 years when visits with nuclear
powered merchant ships are made? What will happen when all ports
and shipping facilities are controlled by your customers? We must get
up to date. We have a need for roads for people to travel and see this
land. This place is no desert. There are places like Easter Island for
tourists. Other places have vast development potential. Valparaiso and
other ports are available for Navy usesChile and U.S. I would like to
tell the U.S. Lets put these economic and military projects together
and not isolate them.
20. Admiral Zumwalt: This magnificent vision that you have de-
scribed could possibly become a reality by working together, and I do
not mean by exploitation of the people of Chile, but to attract the neces-
sary capital. The companies must have confidence that they can make a
profit.
21. President Allende replied there are two sides to this. The pri-
vate corporation and lending organization and/or the World Bank,
Intra-American Bank, etc. It is more important to push the whole effort
to a regional basis. In the Northern part, I would say to the North
American technicians, What would you do with it. To the wealth of
the sea, I would ask, What would you do with it? To the deserts
where a drop of water will grow fruit to the size of watermelonit
could be a paradise. The problem is, until we have mutually satisfac-
tory arrangements, nothing can start. Copper has been taken from
Chile and we have not been paid a fair remuneration. Yet we have still
to develop our deposits of iron, gold and tin. These things, neither you
nor I can accept.
22. Admiral Zumwalt: As a pragmatic man, I have to look at where
we are and how to get where it is mutually profitable for both of our
countries. What I talk to now, I will also ask Mr. Selden to comment on,
following me. It is my feeling that it ought to be possible for the appre-
hensions of the U.S. public and the Congress to be put aside (calmed),
first by the demonstration of the fair approach of nationalization, if car-
ried out as you described. Secondly, there could be provided motiva-
tion for these or other companies to put their capital into Chile them-
selves or by your setting an example of fairness, perhaps cooperation or
partnership of other interests could provide and recognize the opportu-
nity for Chile to make progress on plans for the future.
23. President Allende: We need technical help without any
limitations.
24. Admiral Zumwalt: In my judgment you have to provide a fair
profit and a fair agreement for the way in which these efforts can be-
come total Chilean after investments have been repaid.
25. President Allende: In the past these agreements of the U.S.
companies were on terms which exploited us. Copper is the classic ex-
378-376/428-S/80023
574 Foreign Relations, 19691976, Volume XXI
ample. They owned thousands and thousands of acres of great mineral
fields but did not develop them. No! No! These men cannot expect
compensation for their undeveloped acres. We have accepted that they
should receive a fair return on their actual dollars invested. In these
technical aspects, the Chilean engineers training in the usage of the
copper mines reached certain levels but now they have no further
knowledge on which to operate. Like Admiral Montero, he could not
conduct ships without adequate professional training, our Chilean
mining employees cannot run the mines without other training. This
makes us ask whether we can continue to work with our own capital on
these terms. The Japanese may be willing to offer certain capital. They
must not allow only a certain level of knowledge. We have need not
only for the raw materials but for industrial know how. If they are not
paid, they will go away from Chile. There will be millions out of work.
It is that kind of leverage we can understand each other. We have dig-
nity as a nation. We must be able to find respectable ways to cooperate
as nations, big or small. I can understand this.
26. Admiral Zumwalt stated that he understood, but the problems
that face those who also dedicate themselves to the service of their
country, the U.S., what they are searching for is some formula for
solving the problems to continue the type of cooperation and assistance
that we have known in the past on terms that would be mutually favor-
able to both our countriespolitically, economically and militarily. It is
worthwhile to the U.S. to have a non-communist Chile with non-
political military forces. It is also worthwhile to Chile to retain her
democratic way while improving the life of her people, without
Sovietization.
27. President Allende: This is what I wish also. We have been so
cautious so far in an effort to avoid trouble with the U.S. I have kept my
mouth shut, especially when the U.S. took away navigational and me-
teorological equipment with no advance notice to the Chilean Air
Force, even when we had an agreement that this would not be done.
(Note: This refers to the 3 AFTAC (Air Force Tactical Applications Com-
mand), a unit that among other things provided meteorological infor-
mation and, incidentally, provided certain utility services, electrical
power to Easter Islanders. These units were withdrawn immediately
after Allende was elected. It is understood from General McAlister that
this withdrawal was mainly as a result of Ambassador Korrys strong
urging.) Why was it done? and without knowledge of the Chilean Air
Force and the government of Chile. Admiral, when they took out those
stations it prevented us from knowing climatic conditions in Northern
Chile. We could not warn our farmers of dry spells. We did not know
how long a dry spell to expect. We request mutual respect and that was
not done.
378-376/428-S/80023
November 5, 1970December 31, 1972 575
28. Admiral Zumwalt: You realize the political realities so I can
speak frankly. Our newspapers report what is said that is sensational
and forecasts things which may or may not happen. They report that
you campaigned on an anti-U.S. position.
29. President Allende: No! Never!; I am not anti-North American.
30. Admiral Zumwalt: But the reports were made in our news-
papers and this is what the people feel in the case.
31. President Allende: I am a Socialist president. Other nations
have requested that the U.S. take out the Peace Corps; but not here. You
have your military missions here and we have not bothered them at all
and welcome continued aid. Those newspapers with government influ-
ence (here) have not printed one word about (against) the U.S. but, read
what the U.S. papers say about President Allende: They say that I have
hit my father so hard that he was crippled for the rest of his life. The
President said it is a little embarrassing to refer to this but there has
been information in the U.S. press that Allende as a doctor had raped
an anaesthetised female patient, and other heinous accusations. I was
8 years as Secretary of Public Health (?) Would it make sense that I
would do these things? (spoke with emotion) Your papers (on these re-
ports?) have requested no interviews. I know what we wanta decent
life for all our citizens. I do not want to penalize anyone. I say what I
think and will be guided by what Chile needs.
32. Mr. Selden: Admiral Zumwalt has covered our position very
well. Having been a member of Congress I can understand the
problems you face with the press. However, perhaps our visit can cor-
rect some of the misconceptions we may have read.
33. President Allende: We want U.S. personnel to visit Chile to cor-
rect wrong ideas. We want the Enterprise to visit Chile so that they will
get a correct idea of the people and of our landand, I want to go
aboard Enterprise.
34. Admiral Zumwalt: If she is able to come, you will be invited.
35. Mr. Selden: I want to be sure that we understand correctly your
position and can report this position. As I understand your remarks,
the Soviet port loan is to be a loan only and there will be no Soviet tech-
nicians connected with the construction.
36. President Allende: We have elected to take this $42M loan and
to use it for making a fishing port. They offered us a loan of $42 million.
We selected where and what it is to be used for, because we have thou-
sands of miles of fishing coastline and no fishing port. So, it is obvious
that we need one. If the U.S. lends us such funds we would use it for
that and if you do not, you cannot deny us the opportunity to accept it
from others.
37. Mr. Selden: We would like assurances that it will not be for the
use of others, other than Chile. We would like to knowthat it would not
be used for placing Soviet technicians in Chile.
378-376/428-S/80023
576 Foreign Relations, 19691976, Volume XXI
38. President Allende: If we build a port with U.S. funds, it is nat-
ural that we would have some U.S. technicians, is it not? If the Japa-
nese, among others, loan us funds, there would be Japanese techni-
cians. If Japanese want to help us does that indicate that we will
become a satellite of the Japanese? If the Soviets offer to help us it does
not indicate that they will become permanent. You will always have
priority, but if you say no, we must look elsewhere. It will take 3 years
to build this port. We cannot wait longer to get started.
39. Mr. Selden: We can take this expression of your views back and
it will provide an opportunity for your representative and ours to talk
further on this matter.
40. President Allende: We need a shipyard. We need technicians to
help us build it.
41. Mr. Selden: You have needed a special crane for your shipyard.
Just before starting this trip I learned that it has been authorized for
construction.
42. President Allende (speaking with a large smile): If you want to
help us, exchange our submarine for us.
43. Admiral Zumwalt: These are things that I want to discuss in
Washington within the ambiente (sicspirit) in which this visit has
been conducted. There are matters of economics, military, political, all
to be resolved. None can be done in isolation.
44. President Allende: Your technical military help is magnificent.
45. Admiral Zumwalt: I will urge higher level discussions on this
matter so that I can explore provision of military assistance and Mr.
Selden can explore provision of military and economic assistance in
which we both want our country to be able to play a role so political un-
certainties can be resolved.
46. President Allende: I have nominated an ambassador to the U.S.
He is a socialist. It is Mr. Orlando Letelier. He has many years of finan-
cial experience and he speaks perfect English as well as he speaks
Spanishand, he loves the United States dearly. He is ready to nego-
tiate at any time.
47. Admiral Zumwalt: Mr. President you have been more than
kind to give us so much of your time. (Admiral Zumwalt getting ready
to rise).
48. President Allende: Admiral, it has been quite pleasant to speak
to you in this fashion. If I did not have a desire to speak to you, I would
not do it in this way. I would urge you to take off your uniform and
travel silently in this country and you will see what a democracy this is.
Your Ambassador has never called on me yet. He is very welcome any
time.
378-376/428-S/80023
November 5, 1970December 31, 1972 577
49. Admiral Zumwalt: I hope that I can report your invitation to us
to return some day.
50. President Allende: Not only are you both invited, but you will
be my guests (with emphasis).
51. The meeting ended at 1315 with an expression of appreciation
and other amenities.
208. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, February 23, 1971.
SUBJECT
Allendes Interests and Objectives
Attached for your information is a lengthy situation report on the
current status of iron and copper nationalization efforts in which Am-
bassador Korry provides an interesting analysis of the Allende gov-
ernments interests and objectives in both the short and the longer
term.
2
In the longer term Korry says that Allende:
Wants access to the capital markets and technology of the U.S.
and other developed countries.
Wishes to proceed towards the integration of Chile into the so-
cialist world gradually and without complicating its internal political
and economic problems.
In the short run Korry ascribes the following motives to Allende
and his advisors:
Desire to reach a reasonable and acceptable solution in the case
of the nationalization of Bethlehem, and also of two smaller American
firms (NIBSA and Purina), in order to have proof prior to the April mu-
nicipal elections that even US companies can come to terms with the
UP Government. According to Korry, Allende expects this will have a
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret. Sent for information. The memo-
randum was initialed by Kissinger.
2
Attached but not printed is telegram1000 from Santiago, February 22. The Depart-
ment of State copy is ibid., RG 59, Central Files 197073, INCO 152 CHILE.
378-376/428-S/80023
578 Foreign Relations, 19691976, Volume XXI
public impact on those who continue to resist the Government and its
programs.
Desire to use a favorable outcome to the Bethlehem negotiation
to bolster the Chilean mission to the US this week under the leadership
of Minister of Economy Vuscovic. The purpose of the mission is to
make Allendes case in the Inter-American Committee of the Alliance
for Progress (CIAP), but in addition Vuscovic and the other members of
the mission will be having contacts with US and international figures of
importance for the Allende plan of a painless transition to socialism.
Korry adds that certain traditional modes of conduct affect the
pursuit of these aspirations by the GOC. These are the desire to avoid a
confrontation and a sense of inferiority. The weakness arising from
these Chilean modes of conduct are balanced, Korry infers, by an
agility of mind and manuever and a strong sense of nationhood.
In his message Ambassador Korry continues to counsel a more ac-
tive role for himself and the US Government in seeking a negotiated so-
lution for the US copper companies. As you know, a strategy for pos-
sible US Government actions is being developed as a result of the
decision taken in the most recent SRG meeting on Chile, and should be
ready for clearance by the SRG principals shortly.
378-376/428-S/80023
November 5, 1970December 31, 1972 579
209. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, February 24, 1971.
SUBJECT
Proposed Visit of USS Enterprise to Chile
During Admiral Zumwalts visit to Chile he apparently offered to
send the USS Enterprise for a port call to Valparaiso next week.
2
The En-
terprise is enroute from the Atlantic to the Pacific and can be in Chilean
waters on February 28.
Zumwalt apparently made the arrangements for the visit without
checking with the Embassy. Ambassador Korry agreed to the visit after
the fact, but has sent in a series of cables (Tab A)
3
indicating several
complications and disadvantages of going ahead with the visit. My un-
derstanding is that Korry would prefer not to have the visit, but feels
that Zumwalt is committed and therefore he (Korry) does not want the
responsibility for turning it off. Similarly, State is unhappy about the
proposed visit, but is prepared to live with it if Admiral Zumwalts
prestige is on the line. The following is a list of some of the pros and
cons of going ahead with the visit:
Pros:
Would reinforce ties with the Chilean Navy.
Would be visible reminder to the GOC and Chilean public of
U.S. military power.
Would add one more port where U.S. nuclear-powered vessels
have been received (useful precedent).
Would meet commitment made by Zumwalt.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. III. Secret; Eyes Only. Sent for action. Attached
to a February 26 note from Nachmanoff to Kissinger that reads, Press reports indicate
that President Allende announced last nighton nationwide T.V.that he had invited
the USS Enterprise to visit Chile so that its crew could see that Chile is engaged in au-
thentic democracy. He also issued a stern warning against any demonstrations against
the ships visit. It appears that we have been had. After Allendes statement, a turndown
of the visit now would be taken as a pretty deliberate snub. It would also be played up in
the press as U.S. (read White House) unwillingness to allow our sailors to see the truth
about Chile. (Ibid.)
2
See Document 207.
3
Attached but not printed are telegrams 988, 1003, and 1010 from Santiago, Feb-
ruary 19 and 22. Also attached is Defense Attache message DATT 0075 from Santiago,
February 22.
378-376/428-S/80023
580 Foreign Relations, 19691976, Volume XXI
Cons:
Would play into Allendes hands by demonstrating to the
Chilean military and public just prior to the municipal elections in
April that the Allende government is capable of maintaining close rela-
tions with the U.S.would strengthen Allendes image with the mili-
tary and reassure public opinion prior to the elections.
Visit could give extremists (MIR) an occasion to protest and
demonstrate against U.S. imperialism, nuclear ship; some risk of inci-
dents with sailors on liberty.
Could give Allende a better case for allowing a Soviet naval
visitvisit of nuclear-powered Enterprise might help justify future visit
of nuclear-powered Soviet submarine.
Port call by major U.S. vessel to Chile might be resented by
friendly Latin American military in Argentina and Brazil. (Ambassador
Lodge feels visit to Chile without visit to Argentina would be most un-
fortunate. Tab B)
4
This is a difficult issue, and I do not have the full story of how
Zumwalt agreed to a visit by the Enterprise to Chile. Admiral Robinson
is attempting to get a debrief from Zumwalt, who has not yet sent in a
report on his hour and a half with Allende. (I understand Zumwalt is
going to brief Laird, Moorer and Irwin in separate meetings this after-
noon.) Defense and Navy are pressing for a decision because of the
need to make arrangements for the port call. However, this could be so
politically sensitive that you may wish to consider this in the SRG or to
consult with Packard and Irwin by telephone.
If Zumwalts prestige were not involved, I would come down
clearly against the visit. If we decide not to send the Enterprise in, we
could always maintain that operational requirements made it impos-
sible for the Enterprise to spend two to three days in Chile.
A possible compromise solutionto partially meet Zumwalts com-
mitmentwould be a so-called fly-on visit, under which the Enter-
prise would steam up the Chilean coast approximately 100 miles off
shore enroute to the Far East. High-ranking officials of the Chilean
Navy would be invited to fly on board for lunch and a tour through the
ship. No political figures would be included in the invitation. The
Chilean Navy officers would be picked up by passenger-carrying air-
craft from the Enterprise in either Santiago or Valparaiso and returned
in the same fashion following the visit. Fly-on visits to aircraft carriers
are standard techniques when it is not possible or desirable for the ship
to enter port. In this case, we could inform the Chileans that pressing
4
Telegram 2702 from Buenos Aires, February 24, is attached but not printed.
378-376/428-S/80023
November 5, 1970December 31, 1972 581
operational requirements prevented taking several days for an official
port call.
Pros:
Fulfills Admiral Zumwalts commitment.
Maintains ties with the Chilean Navy and keeps the contact
strictly within Navy channels.
Avoids the physical presence of the Enterprise in a Chilean port,
with all that implies.
Minimizes the opportunities for Allende to exploit the visit for
political purposes prior to the municipal elections in April.
Avoids setting a precedent which might be used to justify a sub-
sequent visit by a Soviet nuclear-powered vessel to a Chilean port.
Cons:
It is a half-measure and might appear so to the Chilean Navy;
hence, it can be argued that it does not in fact meet Admiral Zumwalts
commitment.
No pay-off in terms of impressing the Chilean people with the
armed might of the United States.
No pay-off in terms of adding one more port in which U.S.
nuclear-powered vessels have been received.
Whether this solution would be a workable compromise or not
depends, of course, on the precise nature of Admiral Zumwalts
commitment.
Recommendation
That you take this situation up with Packard and Irwin today to
decide whether to go ahead with a visit by the Enterprise to Chile.
5
5
Kissinger did not initial either the Approve or Disapprove option, and OBE is
written on the first page of this memorandum. See Document 210.
378-376/428-S/80023
582 Foreign Relations, 19691976, Volume XXI
210. Minutes of a Meeting of the Senior Review Group
1
Washington, February 25, 1971, 2:363:50 p.m..
SUBJECT
Middle East, Chile
PARTICIPATION
ChairmanHenry A. Kissinger JCS
Adm. Thomas H. Moorer
State
Adm. Elmo R. Zumwalt, Jr.*
Under Secretary John N. Irwin
R/Adm. Wm. R. St. George
Mr. Joseph J. Sisco
Mr. Alfred L. Atherton NSC Staff
Mr. Thomas Thornton Col. Richard T. Kennedy
Mr. Harold H. Saunders
Defense
Mr. Arnold Nachmanoff*
Mr. David Packard
Mr. D. Keith Guthrie
Mr. Armistead I. Selden
Mr. James S. Noyes
CIA
Mr. Richard Helms
Mr. David H. Blee
*Present for Chile discussion only.
SUMMARY OF CONCLUSIONS
[Omitted here is conclusion 1. on Strategy to Israel.]
2. Chile. Following a poll of SRG members and consultation with
the Secretary of State, the question of a visit by the carrier Enterprise to
Valparaiso will be referred to the President for decision.
2
Dr. Kissinger: We have two subjects to take up todaythe Middle
East and Chile. I asked Admiral Zumwalt to drop by about 3:15 to give
his views about having the carrier Enterprise make a visit to Chile. The
President himself wants to consider this question. We will certainly
have an answer by tomorrow morning. If an answer were requested
right now, it would be no.
[Omitted here is discussion unrelated to Chile.]
(Messrs. Sisco, Atherton, Thornton, and Saunders left the meeting
at this point. Adm. Zumwalt and Mr. Nachmanoff entered.)
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H52, SRG Meeting, Chile. Secret; Nodis. The meeting took
place in the White House Situation Room.
2
See Documents 207 and 209.
378-376/428-S/80023
November 5, 1970December 31, 1972 583
Chile
Adm. Zumwalt: Our Chile visit was extremely cordial. The mili-
tary obviously wish to maintain contact. The Embassy considers that
Allendes present problem is to consolidate his position. The Military
Group believes that the Chilean military are still a substantial force for
moderation. It is clear to me that the military are highly pro-US.
We went to Valparaiso to see the fleet. In the course of our conver-
sations the Navy people told us that the Chilean military is dedicated to
constitutional processes. They want close ties with the US and want to
keep the Soviets out. The Navy officers said: We are willing to support
you and provide tanker facilities. I mentioned that the Enterprise was
in the area and said that it was possible I could get a government deci-
sion approving a call in Chile.
We then had a one-hour meeting with Allende. It was arranged on
such short notice that we did not have an opportunity to inform the
Embassy in advance. Even though you know what sort of a person Al-
lende is, he comes through as a fascinating, charming, charismatic indi-
vidual. In the presence of the Chilean CNO he talked about the needs of
the Chilean Navy. He said he desired to continue and increase the Mil-
group. He brought up the Enterprise visit and said that he would be
glad to have the carrier visit Valparaiso, that it would provide an op-
portunity for those aboard to see what Chile was really like, and that he
himself would be pleased to go aboard. He stressed the value of visits
of all kinds in correcting misunderstandings about Chile. He was con-
cerned about the Chilean image in the United States and asserted that
he had never been a non-democrat or a Sovietizer.
On the nationalization issue, Allende said that adequate compen-
sation would be provided and the companies would have legal redress.
He commented: Even your people agree that the courts are not subject
to my bias. He said that Anaconda had taken out $9.4 billion in profits
while leaving Chile poor and not training any Chileans.
Allende showed us his plans for the development of Valparaiso
harbor. He said he hoped for continued help from the US along with
others in financing this venture. The key was a mutually satisfactory ar-
rangement on nationalization.
We mentioned the US concern about a fair settlement, and he re-
plied by talking about past exploitation by the companies. He empha-
sized that he wanted a fair deal and that he was making an effort to
have good relations with the US. He pointed out that he had said
nothing about the removal of AFTAC even though this deprived
Chilean peasants of weather reports. He also noted that he had allowed
the Peace Corps to remain. He commented on the libelous stories about
him which he said had appeared in the US press.
378-376/428-S/80023
584 Foreign Relations, 19691976, Volume XXI
Mr. Selden asked about the presence of Soviet technicians. Allende
said that if the US provided aid, it would want to have its technicians
present; the same was true of the Soviets. He said he would not permit
a permanent Soviet presence and added that the US has first call for
providing assistance if it wishes to do so. He commented that the US
Ambassador had never been to call on him.
The Chilean Navy have an arrangement with Allende they believe
will protect their interests. As an indication of this they point to the fact
that Admiral Montero refused to fire a navy officer by the name of
Lopez who was implicated in anti-Allende plotting.
The military do talk among themselves about the problem of com-
munist penetration. They want to continue FMS and are resentful about
the cutback. The Army and the Air Force asked if this signified some fa-
voritism toward the Navy.
We think that Allende will continue to consolidate his strength but
that the military are still a moderating influence. Our view is that the
military offers us the only prospect for influencing events in Chile
while increasing our options. Our recommendation is that a recog-
nized, prestigious individual be appointed to negotiate with Allende
and that he be provided with a top-notch team of experts to provide
support.
In the meantime, we need a decision on the Enterprise, which is
moving rapidly up the west coast.
Mr. Kissinger: Could it move more slowly?
Adm. Zumwalt: Yes. If the Enterprise fails to go to Chile, Allende
can tell the military: I took your advice and got slapped in the face. I
also think we ought to loosen up a bit on providing spare parts to the
Chilean military.
Mr. Kissinger: Does anyone have any views? Jack [Irwin]?
3
Mr. Irwin: The question is how much Allende can make of the
visit. Would the benefit be greater to him than to the military? I gather
that Admiral Zumwalt thinks the military would derive the greater ad-
vantage. I am not specifically opposed to the visit, but I think there is a
real danger that Allende can play this politically to a greater degree
than we might think. I would like to contemplate the matter a while.
Mr. Kissinger: We dont have to make a decision right now. We can
talk; then I can poll the members later and go to the President.
Mr. Helms: Where is the ship at the moment?
Adm. Moorer: Coming up the west coast of Chile.
3
These and the remaining brackets are in the original.
378-376/428-S/80023
November 5, 1970December 31, 1972 585
Mr. Selden: I have no illusions about Allende; I think he is a com-
munist. But I do think the military is trying to keep contact with us. Al-
lende is catering to them. Maintaining contact with the military is the
only thing we have in Chile.
Mr. Kissinger: If I can draw a distinction here, we have always sup-
ported contact with the military. Last week we approved FMS and
M41 tanks for them. The issue is whether a carrier should visit Chile
three weeks before provincial elections which might register an
anti-Allende vote. We have already had a four-star admiral and a
four-star general visit Chile. We are not cutting ourselves off from the
military.
Mr. Selden: Ambassador Korry said there was no way Allende
could get less than 50% of the vote in the elections.
Mr. Kissinger: Could it make a difference whether he got 51% or
57%?
Mr. Selden: Not much.
Mr. Helms: If the Enterprise were to visit Santiago as well as Rio,
we would be giving even-handed treatment [to both right and
left-wing regimes].
Adm. Zumwalt: On our trip we talked to Campos while in Brazil.
He says that it will be one to three years before the economic impact of
Allendes policies hurts the Chilean people. In the meantime, the pros-
pects are that he will enjoy a wave of popular support.
Mr. Kissinger: (to Adm. Moorer) What is your view?
Adm. Moorer: The visit is entirely feasible. The question is
whether it will help the military or Allende more.
Mr. Kissinger: What is it that we cant do for Allende?
Mr. Selden: We are trying to enhance the position of the military.
Mr. Packard: I see two dangers. First, a visit might encourage pop-
ular support for Allende. People who would otherwise be against Al-
lende might interpret a visit as evidence that he has the tacit blessing of
the U.S. The second danger is that anti-US actions might be under-
taken. This sort of visit is not likely to have a significant impact on the
militarys position in Chile although it might strengthen US-Chilean
military ties. Right now I think the negative aspects outweigh the posi-
tive. I dont see any strong reason to favor the visit, and I see some
strong reasons against it.
Adm. Zumwalt: We need to keep in mind the long as well as the
near term. I think what Allende has in mind is the near-term advan-
tage, that is, the elections. In the long term we will need to get a settle-
ment for American capital. The visit would be a downpayment of good
faith on our side. It also gives the military a chance to keep the pressure
on Allende.
378-376/428-S/80023
586 Foreign Relations, 19691976, Volume XXI
Mr. Kissinger: Ever since September 1 it has been argued that if we
turn the screws on Allende, he will only be strengthened. Yet he has
only gotten stronger.
Adm. Zumwalt: We may be getting some bad judgments out of
our embassy in Chile.
Mr. Packard: This visit is different from providing aid. It is a pub-
licity measure.
Mr. Kissinger: This would be a gesture of national good will
toward Allende. He wants to go aboard; he wants to have people see
Chile.
Adm. Zumwalt: I think our policy of putting the screws on Al-
lende is proving counterproductive. He may turn the other way, and
the military will support him.
Mr. Kissinger: Because a nuclear carrier failed to visit Valparaiso?
Adm. Zumwalt: Because it was suggested that the carrier could
visit Valparaiso and then it failed to do so. I realize I have been Pecks
bad boy in all of this.
Mr. Kissinger: I think we ought to think about this. Ill talk with the
Secretary of State and will check with all of you. I cant see a Presiden-
tial decision before tomorrow morning. I can tell you he is not wild
about the idea.
4
4
The USS Enterprise did not visit Chile.
211. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, March 5, 1971.
SUBJECT
ChileGood Offices by Ambassador Korry
Assistant Secretary Meyer has sent over for your clearance a draft
scenario for an approach by Korry to the Chileans to offer good of-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Secret; Nodis. Sent for action.
378-376/428-S/80023
November 5, 1970December 31, 1972 587
fices in support of direct negotiations between the Chilean Govern-
ment and the copper companies.
2
You will recall that the Senior Review
Group asked State to prepare a draft along these lines which would
include an instruction to Korry and which would be designed to in-
sure that his role was confined to that of an intermediary so that we
could avoid being drawn into direct negotiations with the Chilean
Government.
3
The draft scenario identifies our objectives during the next few
weeks to be:
to determine by probing whether GOC policy on copper pro-
vides any likelihood of reasonable negotiated settlements with the
companies.
if a likelihood exists, to prepare the ground for a reasonable set-
tlement by impressing upon the GOC the standards of compensation
we expect, reminding them of the consequences of confrontation over
the compensation issue, inducing further flexibility in the constitu-
tional amendments and the way they are applied, and in the interim
promoting satisfactory negotiations between other US investors (e.g.
Bethlehem) and the GOC.
to carefully avoid being drawn into government-to-government
negotiations on copper.
persuade the GOC to negotiate an agreed-upon takeover in ad-
vance of expropriation under the proposed amendments.
Accordingly it authorizes Korry to respond positively to the invi-
tations to dialogue extended by GOC officials. The authorization ex-
tends to direct contact with Allende and provides detailed talking
points which:
indicate the USG is disposed to avoid a dispute;
indicate we are seriously concerned at the terms of the proposed
amendments, citing some of the reasons why we do not consider them
consistent with international law;
suggest to the GOC the utility of exploring settlement terms
with the copper companies prior to completion of the legislative
process;
stress the need for flexibility in various aspects of the copper
legislation;
indicate Korry will be authorized to provide unofficial good of-
fices with respect to the GOC-company negotiations.
2
Attached but not printed.
3
See Document 206.
378-376/428-S/80023
588 Foreign Relations, 19691976, Volume XXI
Korry is instructed to refrain from further top-level talks after ini-
tial soundings until receiving further instructions. The instruction
warns him to take pains to insure that the contacts are not taken by the
Chileans as negotiations with the USG.
I do not have any problem with the scenario or instructions per se.
There are two issues which should be considered, however:
1. Do you want to give Korry authorization to call upon Allende
now, or should he be instructed to make his pitch at the ministerial
level first and then come back for specific authorization to call upon
Allende?
4
A recent cable from Korry indicates that he received word that Al-
lende wanted very much to talk to him (Tab B).
5
Korry replied that he
preferred to see the Bethlehem deal satisfactorily consummated before
any conversations with Allende. Thus, it appears that Korry is not plan-
ning to rush in to call upon Allende and that he would make his pitch at
the ministerial level first. Moreover, if we are willing to allow Korry to
call upon Allende at all, the complex copper situation is evolving so
quickly that it is doubtful that the SRG will be in a better position than
Korry to make the tactical judgment of when a meeting with Allende
would be most effective.
2. Will Korry remain in Santiago long enough to followup with his
offer to provide unofficial good offices when GOC-company negotia-
tions begin?
If he is authorized to offer good offices, the implication is that he
will remain in Santiago for at least three or four more months. It is very
unlikely that any successor could acquire the expertise or the contacts
to pick up this role if Korry were to leave.
I realize there are risks in letting Korry begin to go down this slope.
However, there have been several indications that Allende does want
some kind of mutually satisfactory settlements with the copper com-
panies; if we do not allow Korry to probe and push a little further, we
may miss an opportunity and be vulnerable to later charges by the
GOC and the copper companies that we did not make an effort to help
achieve fair settlements. Moreover, as long as Korry is there, he is going
to operate anywaythe instructions at least give him some parameters
and make very clear that he is to avoid being drawn into direct negotia-
tions. On balance, therefore, I recommend that you clear the proposed
instruction to Korry.
4
Kissinger highlighted this paragraph and wrote yes in the margin.
5
Attached but not printed at Tab B is telegram 1226 from Santiago, March 3.
378-376/428-S/80023
November 5, 1970December 31, 1972 589
Recommendation
That you approve the scenario at Tab A.
6
6
Kissinger initialed the Approve option and wrote, with covering memo by us
pointing out reservations. A March 17 memorandum from Kissinger to the Ad Hoc
Working Group indicates that he approved the draft telegramwith the following reserva-
tions: Ambassador Korry should make his approach first at the Ministerial level and not
call upon President Allende to discuss this matter or take advantage of any casual contact
to do so. If the results of his contacts at the Ministerial level are promising, he should then
request specific authorization to call upon President Allende. The manner of Ambas-
sador Korrys approach should in no way indicate willingness on our part to become in-
volved in negotiations with the Chilean Government. (National Archives, Nixon Presi-
dential Materials, NSC Files, Box 774, Country Files, Latin America, Chile, Vol. IV) The
draft telegram was sent as telegram 48273 to Santiago, March 20. (Ibid., RG 59, Central
Files 197073, INCO COPPER CHILE)
212. Memorandum From the Presidents Deputy Assistant for
National Security Affairs (Haig) to the Presidents Assistant
for National Security Affairs (Kissinger)
1
Washington, March 10, 1971.
SUBJECT
Ambassador Korry
As I mentioned to you earlier, I am very concerned about the fu-
ture status of Ambassador Korry. I understand that Rogers is deter-
mined to fire him as soon as possible and to not offer him any further
assignments. As you know, I hold no great brief for the Ambassador,
however, in his own mind he has worked diligently for the President
and for you and I understand feels that the treatment he has received
has resulted from his responsiveness to the White House.
He holds a great many secrets, including the fact that the President
both directly and through you communicated to him some extremely
sensitive guidance. I can think of nothing more embarrassing to the Ad-
ministration than thrusting a former columnist who is totally alienated
from the President and yourself, as well as the Secretary of State, out
into the world without a means of livelihood. This can only lead to rev-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 778,
Country Files, Latin America, Chile, Vol. I, Korry File. Secret. A handwritten notation at
the top of the memorandum states, HAK took this up with Rogers 11 March.
378-376/428-S/80023
590 Foreign Relations, 19691976, Volume XXI
elations which could be exploited by a hungry Democratic opposition
to a degree that we might not have heretofore imagined.
In view of this, I strongly recommend that you talk to Secretary
Rogers again about the need to offer this individual a suitable alternate
assignment. If Secretary Rogers permits his temper to prevail, then I
urge you to talk to Bob Haldeman and insure that Korrys loyalty to the
President and yourself is at least insured by offering him some other
post within the Administration.
In any event, it is a little shabby to treat an individual in the
manner in which Rogers is apparently doing. This is a serious matter,
raised by Korry with Arnie Nachmanoff in Panama this past weekend.
It was evident to Arnie that Korry is rapidly building a whopping re-
sentment against you and the President.
213. Memorandum From Frank Chapin of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, March 17, 1971.
SUBJECT
Progress Report on Preparations for the Chilean April 1971 Elections, Including a
PDC Request for Additional Campaign Funds
The attached memorandum forwarded by Dick Helms reports on
actions taken by CIA since 28 January when the 40 Committee author-
ized financial support in the total amount of $1,240,000 to various
Chilean opposition parties for the April 1971 municipal elections and
for the purchase of media outlets.
2
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172. Secret; Sensitive; Eyes Only. Sent for action. Chapin noted in an attached March
17 memorandum to Kennedy, I will appreciate anything you can do to get HAKs ap-
proval on this expeditiously and let me know so that CIA can send appropriate notifica-
tion to the field. I am well aware that Henry does not normally like to handle these
matters without formally convening a 40 Committee meeting. However, timing is urgent,
the approval sought is limited to an increase in funds for a program already discussed
and approved, and all other members of the 40 Committee have now voted in the affirm-
ative. (Ibid.)
2
See Document 201. Attached but not printed is the March 15 memorandum for the
40 Committee. The memorandum is Document 56 in Foreign Relations, 19691976, vol.
E16, Documents on Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 591
The memorandum also requests approval for another [dollar
amount not declassified] which the Christian Democratic Party (PDC) is
urgently seeking for additional electoral support of its candidates. This
would bring the total authorization of funds for PDC electoral support
to [dollar amount not declassified].
Because of the time factor, Dick Helms has asked that the members
of the 40 Committee give their telephonic approval to upping the ante
of the financial support originally approved by the extra [dollar amount
not declassified] requested by the PDC. Messrs. Mitchell, Irwin, Johnson,
Packard, and Admiral Moorer have all concurred in authorizing this
extra sum for PDC electoral support.
The CIA paper points out that the Allende government is sup-
porting a massive drive for electoral support to the UP parties and that
the Communist Party in particular has been spending unprecedented
sums of money in an especially impressive election effort. Allende is re-
ported as having expressed the fear that the UP will receive less than
50% of the total vote which would make it more difficult for the UP to
justify acceleration of its program than if it received more than 50%.
The National Party (PN) campaign has thus far been conducted
with seeming effectiveness, and the PN hopes to garner about 25% of
the vote. [less than 1 line not declassified] there has been some muting of
PN attacks on the PDC but this has not ceased completely.
There is still factionalization within the PDC between the Tomic
left wing and Freis moderate faction. In addition, UP proselytizing and
physical threats among lower income group PDC supporters has badly
hurt the PDC. Despite organizational weaknesses the PDC election
campaign has gotten off to a vigorous start, [less than 1 line not declassi-
fied], and they are attempting to eliminate feuding with other opposi-
tion parties, particularly the PN.
The Democratic Radical Party (PDR) campaign is a quiet one
stressing personal contacts. It is properly targeted at those Radical
Party members who defected to Alessandri during the last presidential
campaign, reminding them that a vote for the Radical Party signifies an
endorsement of the Allende regime. PDR leaders have been helpful in
reducing frictions between PN and PDC campaign leaders. The PDR
hopes to get about 6% of the total vote in the municipal elections.
The Zaldivar (PDC) campaign for Allendes vacated Senate seat
has been enhanced by the withdrawal of Sylvia Alessandris candidacy,
[3 lines not declassified]. Zaldivar is energetic and running an impressive
personal campaign, but the Agency is presently skeptical that Ovalle
will withdraw.
The reason for the PDC request for an additional [dollar amount not
declassified] in electoral support funds is simply that it is not receiving
the large industrial and commercial campaign contributions on which
378-376/428-S/80023
592 Foreign Relations, 19691976, Volume XXI
it had relied. From a campaign planning standpoint the PDC must now
know whether additional funds will be available or whether it must
scale down its activities during the final and crucial days of the cam-
paign. The additional funds should be sufficient to enable the party to
maintain its campaign at optimum level [3 lines not declassified].
Recommendation
That you approve the additional [dollar amount not declassified]
requested by the PDC for electoral support in the current election
campaign.
3
3
Kissinger initialed the Approve option on March 22.
214. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, March 20, 1971.
SUBJECT
CIA Report on Chiles Economic Vulnerabilities
Attached for your information at Tab A is a report prepared by
CIA
2
on the outlook for the Chilean economy, its vulnerabilities, and
the likely impact of U.S. economic sanctions which might be consid-
ered. The report reaches the following conclusions:
The Chilean economy has performed poorly in recent years, and
little or no growth is in prospect for 1971. While a severe economic
downturn this year is not likely, there will be some interruptions in
output as a result of expropriations, business failures, and stepped-up
land reform.
The U.S. has little economic leverage in Chile and economic
sanctions would probably have only a limited impact on Chiles
economy over the next year or two. (The U.S. accounted for only 17% of
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Secret; Sensitive. Sent for information. A
stamped notation on the memorandum indicates the President saw it.
2
Tab A, a report dated February 12, is attached but not printed. See Foreign Rela-
tions, 19691976, vol. E16, Documents on Chile, 19691973, Document 51.
378-376/428-S/80023
November 5, 1970December 31, 1972 593
Chiles exports in 1969 and probably for less in 1970. Most of these ex-
ports, including copper, could be sold to other markets.)
Chile would not be particularly vulnerable to a termination of
U.S. aid since it has a backlog of over $400 million in long-term credits
(of which only about $70 million consist of U.S. official loans) which are
usable over the next three years.
In addition to having no real leverage over copper sales, the U.S.
also has none over the process. The Chileans could continue to operate
the copper mines without us, although output might be less efficient
than under U.S. management. Chile could get necessary supplies and
technical help to run the industry from a number of countries other
than the U.S. since the technology used is common to the copper
industry.
Although the U.S. has been a major supplier of capital goods to
Chile, blocking future sales to Chile also would have only a small,
short-term impact since similar goods could be purchased from other
sources, such as Western Europe and Japan.
In the short run, sanctions would probably improve Chiles fi-
nancial position by giving Allende an excuse to default on U.S. public
and private loans which total $900 million.
In sum, the report suggests that traditional economic sanctions
such as those used against Cuba probably would have little immediate
adverse impact on Chile. It also suggests they could prove counterpro-
ductive by giving Allende an excuse to tighten his political control,
boosting his local popularity, increasing international sympathy for his
regime, and causing Chile to move more rapidly to strengthen its ties
with the Soviet bloc.
3
Last October, Ambassador Korry indicated that the economic situ-
ation in Chile was likely to deteriorate this year and might reach a se-
rious point about the time of the April 4 municipal elections. He im-
plied thereby that we might have some measure of leverage in Chile at
that time. The report indicates, however, that the economic situation is
not likely to reach a really serious point this year and that we have no
real leverage over the immediate situation in Chile.
3
When Nachmanoff sent Kissinger a draft of this memorandum on February 26,
Kissinger wrote next to this paragraph: Exactly contrary of what we were told in Oct.
Redopoint out that this is precisely the opposite of what Korry urged on us last year.
Hewitt responded to this instruction in a March 6 memorandum to Kissinger: The
records on this are unclear. While Korry indicated last October that it was possible that
the economic situation in Chile might deteriorate (and perhaps reach a serious point
around the time of the April municipal election), and implied thereby that we might have
some leverage at that time, I do not find any evidence of an oversell by Korry of the
amount of leverage which the U.S. could exert in Chile. (National Archives, Nixon Presi-
dential Materials, NSC Files, Box 774, Country Files, Latin America, Chile, Vol. VI)
Hewitt, therefore, added the last paragraph to this memorandum.
378-376/428-S/80023
594 Foreign Relations, 19691976, Volume XXI
215. Memorandum of Meeting
1
Washington, March 23, 1971, noon.
PARTICIPANTS
Dr. Henry A. Kissinger, Assistant to the President for National Security Affairs
Orlando Letelier del Solar, Ambassador of the Republic of Chile
Arnold Nachmanoff, Staff Member, National Security Council
SUBJECT
USChilean Relations
Ambassador Letelier referred to his meeting with Secretary Rogers
and the President,
2
noting that he had indicated to them that his gov-
ernment is interested in having a high US official visit Chile. He noted
that a US Air Force Delegation was visiting Chile at the present time.
3
Ambassador Letelier indicated that he has been trying to explain
what the Chilean Government is and what it is trying to do. He noted
that there were many misconceptions about Chile and a tendency to
oversimplify by making analogies to other places. One aspect to which
he referred was the Chileanization of copper. The Ambassador noted
the status of the constitutional amendment and indicated that the
matter of the law would be finished in about three to four months. He
felt the amendment was not too rigid and would provide general rules
for the nationalization. He noted that one of the misunderstandings
about the copper situation involved the currency in which compensa-
tion would be paid. In response to Dr. Kissingers question, he stated
that payment would be made in convertible currency. There had been
speculation that payment would be made in escudos and the com-
panies would be forced to reinvest in Chile, but that was not correct.
The Ambassador anticipated there would be normal discussions be-
tween the Government and the companies about prices, but he thought
these discussions could be developed in a positive way.
Dr. Kissinger stated that we would like to see a constructive solu-
tion worked out between the Chilean Government and the copper com-
panies. The US Government does not want to be involved as a principal
negotiator though we are prepared to be helpful on occasion to facili-
tate the negotiations if that would be useful. With regard to our general
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Confi-
dential; Limdis. The meeting took place in Kissingers office.
2
Letelier is most likely referring to his February 22 meeting with Rogers and his
February 26 meeting with the President. (Ibid., POL 17 CHILEUS)
3
The USAF delegation was attending the anniversary celebration of the founding
of the Chilean Air Force.
378-376/428-S/80023
November 5, 1970December 31, 1972 595
policy, Dr. Kissinger stated that press reports about the White House
seeking a confrontation with Chile are nonsense. He noted that what
was said in the Presidents Annual Foreign Policy Report is precisely
our policy with regard to Chile.
4
We will determine our relations with
Chile on the basis of its foreign policy, not what it does domestically. Of
course, internal actionssuch as those involving compensation for US
companiesmay have legal implications under our laws. Dr. Kissinger
expressed the hope these can be worked out, however. He reiterated
that our general policy was that we will not be the first to break tradi-
tional good relations.
Ambassador Letelier referred to problems with the press, particu-
larly recent stories about a secret White House document which circu-
lated other Latin countries. Dr. Kissinger stated this was nonsense. Am-
bassador Letelier expressed his appreciation for the denial and noted
that the State Department also had given him a clear statement of de-
nial.
5
He knew that the stories were not true but that it was useful to
have the statement from the State Department. Ambassador Letelier
expressed his view that there were many positive aspects to US
Chilean relations. He commented the Chilean press had become more
moderate and realistic during the last few weeks. He stated that his
government was trying to demonstrate that what they are doing inter-
nally is within Chilean traditions, seeking Chilean solutions.
Ambassador Letelier stated his belief that the government will in-
crease its support in the up-coming municipal elections. He anticipated
that the Unidad Popular (UP) would gain at least 45% of the vote
though the PDC would continue to have the most votes as an indi-
vidual party. He stated his belief that all of the coalition parties will in-
crease their share of the vote though he anticipated that the Socialist
Party would have a greater increase than the others. He noted that the
governments initial problems have been reduced and the country is
working more normally. He declared that the government is trying to
have a real private sector which would work efficiently. In the past the
4
See Public Papers: Nixon, 1971, pp. 246247.
5
The press reported that the White House canvassed friendly governments in Latin
America about the possibility of instigating an economic blockade against Chile. In a
March 17 meeting with Letelier, Crimmins reviewed background of blockade fabrica-
tion, stressing that on its first appearance in Hernanadez Parker article in Ercilla Feb 10,
Amb and DCM in Santiago had raised it with Letelier and Valenzuela, respectively and
said that he was officially and categorically informing Letelier that the allegation of the
existence of a USG document concerning a blockade of Chile was false. Crimmins went
on to say that the Chilean Government had put the United States in an awkward position,
since it would have been improper for the U.S. Government to correct a journalistic ac-
count. Letelier told Crimmins that he accepted Crimminss statement of denial and con-
curred with his statement that a prompt denial by the Chilean Government would have
made the situation much easier for the United States. (Telegram 45390 to Santiago, March
18; National Archives, RG 59, Central Files 197073, POL CHILEUS)
378-376/428-S/80023
596 Foreign Relations, 19691976, Volume XXI
rules of the game were not clear; the present government is trying to
make the rules clear. The social area would be 100% in the hands of the
government but the private sector would be 100% private.
Ambassador Letelier noted that Chile has long had government
control over many industries and that the only important changes will
be in the Gran Mineria, some parts of the iron industry, and the nation-
alization of the banking system. He did not think that in other cases pri-
vate industry would be jeopardized though some groups are moving to
mixed public-private forms. He stated that this movement is not ideo-
logical, and that the government is trying to work pragmatically. Am-
bassador Letelier also stated his belief that there will not be any
anti-Americanism in Chile since none exists there now.
Dr. Kissinger reiterated that the basic orientation of the United
States is to maintain traditional good relations with Chile. Ambassador
Letelier expressed similar sentiments and added that his government
hoped to maintain normal working relations with the US banking
systemand with multi-national agencies. Dr. Kissinger recalled that the
IDB had recently approved two loans for Chilean universities and that
the United States had voted for them. The Ambassador indicated that
his government hoped these institutions will work with Chile to avoid
the impression that the United States is trying to block credit to Chile.
He commented that sometimes people go beyond the real position of
the US Government and noted that Chile was not pressing for any
loans at this time to avoid the impression of difficulties with the United
States. Dr. Kissinger expressed his belief that some of these problems
will straighten themselves out as relations between the two countries
develop.
Dr. Kissinger stated that he would like to have the same cordial re-
lationship with Ambassador Letelier as he enjoyed with his prede-
cessor. He also indicated that he hoped it would be possible to take a
trip to the west coast of South America some day since he had never
been there, but noted that he could not realistically do so in the near
future.
378-376/428-S/80023
November 5, 1970December 31, 1972 597
216. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, March 29, 1971.
SUBJECT
Chile Status Report
A. Developments in Chile
Government and Politics
The municipal elections in April have held the center of the polit-
ical stage in recent weeks with the major parties campaigning hard. The
Popular Unity (UP) coalition hopes for a sweeping victory that will
make the course of the revolution begun with Allendes election irre-
versible. The Christian Democrats (PDC) are unlikely to achieve any-
thing that can be described as victory under the circumstances, but if
they can prevent Allende from getting the majority he seeks it will be a
considerable success in restoring the morale of the anti-UP forces in the
country. However, the chances of blocking a UP majority are slight de-
spite an unusual degree of cooperation among parties in opposition to
the Government.
While vigorously campaigning against one another in the munic-
ipal elections the UP Government and the PDC made a complicated
deal to achieve a kind of uneasy coexistence at the national level. The
PDC agreed to sell the assets of its publishing house, the largest in
Chile, to the Government, and not to oppose in the Congress Govern-
ment legislation for the nationalization of the mining industry. In ex-
change the Government publicly absolved the PDC and its leaders
from any involvement in the Schneider assassination.
The Economy
The Government has moved more slowly than expected in nation-
alizing the foreign-owned mining industry and the legislation it sought
from the Congress has not yet been passed. The draft legislation has
been modified somewhat by PDC forces in the Congress and by the
Government itself. The result, while still far from satisfactory from the
viewpoint of the companies, does give the Government and the Presi-
dent somewhat greater flexibility in dealing with the companies than
did the original draft.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Secret; Sensitive. Sent for information. A
stamped notation on the memorandum indicates the President saw it.
378-376/428-S/80023
598 Foreign Relations, 19691976, Volume XXI
Negotiations between the Chilean Government Steel Corporation
(CAP) and Bethlehem Steel over the nationalization of Bethlehems in-
terests in iron mining in Chile reached fruition on March 23 with the
signing of an agreement. While Bethlehem is unhappy about being
forced out of Chile it finds the compensation formula acceptable, as
does OPIC which had underwritten a large part of Bethlehems invest-
ment in Chile.
Foreign Affairs
Though the more extreme elements in the UP Government see
some advantage in a confrontation with the US, Allende has continued
to be extremely cautious in his relations with us. Commenting on your
Annual Review of Foreign Policy, he said he saw positive elements in
the report which could be a basis for a reciprocal policy of under-
standing and collaboration with the US, and reiterated his desire for
friendly relations with the most powerful country in the hemisphere.
However, he criticized the reports approach to the Organization of
American States (OAS) as unrealistic, and said that the US and Latin in-
terests diverge. Allende adroitly used his invitation to the USS Enter-
prise to visit Chile to illustrate his desire for good relations with the US.
When the visit did not materialize he expressed his regret in mild terms
and left the mudslinging to the leftist press. Partly because of this inci-
dent, and even more because of increasing resistance to Chilean credit
requests among New York banks, Allendes attitude toward the US is
showing a tendency to harden somewhat. A comprehensive report on
trends in Chile prepared by the intelligence community is attached at
Tab A.
2
B. U.S. Actions
With respect to US policy we have:
Clearly re-stated our policy with respect to Chile in the Annual
Foreign Policy Review.
Undertaken within the NSC system a reexamination of our en-
tire hemispheric policy in light of developments in Chile.
Declined to accept an invitation for the USS Enterprise to visit
Chile in order to prevent its exploitation by Allende for internal polit-
ical purposes.
On the diplomatic front we have:
Continued to pass information to other hemisphere countries
and to certain of our allies in Europe and elsewhere.
2
Attached but not printed at Tab A is the March 18 Joint Intelligence Memo-
randum. For the text of the memorandum, see Document 57, Foreign Relations, 19691976,
vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 599
Begun arrangements for State Visits to the US for the Presidents
of Brazil and Peru in order to strengthen ties with possible counter-
weights to Chile.
On the economic side we have:
Used a recent meeting of CIAP to question the soundness of
Chilean economic policies and the effect for Chiles credit-worthiness.
Continued to stall consideration of loans for Chile in the IDB and
IBRD, and to cut off new Ex-Im Bank loans. The Ex-Im also continued
selectively to reduce its export guarantees and insurance for Chile.
Through our Ambassador, reinforced our stated policy on ex-
propriation and compensation and sought to use our influence to
soften the legislation now being considered by the Chilean Congress.
In the military area we have:
Decided to go forward with the delivery of M41 tanks already
committed to Chile.
Set an FMS level of approximately $5 million, some $2 million
under last years level.
Permitted a delegation from the US Air Force to attend anniver-
sary celebrations of the Chilean Air Force.
217. Memorandum From C. Fred Bergsten of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, March 30, 1971.
SUBJECT
ChileBethlehem Steel Negotiations
State (Tab A) and Brad Mills, President of OPIC (Tab B) report the
successful conclusion of negotiations between Bethlehem Steel and the
Chilean-owned steel company CAP.
2
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Confidential. Sent for information. Nachma-
noff initialed his concurrence. Kissinger initialed the memorandum.
2
Attached but not printed at Tab A is a memorandum from Eliot to Kissinger,
March 24, and at Tab B is a memorandum from Mills to Rogers, March 26.
378-376/428-S/80023
600 Foreign Relations, 19691976, Volume XXI
CAP has agreed to purchase Bethlehems iron mining properties in
Chile based on its depreciated book value. The price, between $20 and
$23 million (to be determined by an auditor), will be paid in fifteen an-
nual installments beginning in June 1973 at 5 percent interest. OPIC
has guaranteed Bethlehem that it will pay at least $18 million of that
sum if CAP fails to live up to the agreement. The settlement should
help the forthcoming copper negotiations because its terms were far
better than those proposed in the constitutional amendment for copper
nationalization.
Brad Mills and State agree that Ambassador Korry played a skill-
ful and effective behind-the-scenes role in these negotiations, and that
his judgment and effort contributed substantially to the attainment of
agreement. Mills also feels that by assuring Bethlehem that its assets
would be paid for, in one way or another, OPIC permitted Bethlehem
to take a more diplomatic position vis-a`-vis CAP which facilitated the
negotiating process and avoided a potential confrontation with Chile.
218. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, April 5, 1971.
SUBJECT
Chilean Elections
The first electoral test of the Popular Unity (UP) Government of
President Salvador Allende indicates significant gains for both his So-
cialist Party (PS) and the Leftist Coalition of which it forms a part. Re-
turns are incomplete but it looks as if the UP will win about 4849 per-
cent of the total vote, considerably above the 36 percent Allende gained
in the presidential elections last September, and above the 4445 per-
cent level which would have reflected the traditional constituencies of
the UP parties. An approximate percentage breakdown on the basis of
returns thus far is as follows:
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Secret. Sent for information. A stamped no-
tation on the memorandum indicates the President saw it.
378-376/428-S/80023
November 5, 1970December 31, 1972 601
UP Coalition: Socialist (PS) 21%
Communist Party (PCCH) 16%
Radical Party (PR) 9%
Splinter Groups 1%
48%
Opposition: Christian Democrats (PDC) 25%
Nationalists (PN) 20%
Nulls and voids 34
President Allende has called the results a mandate for the UP pro-
gram. He explained the strong showing of the Socialists by pointing out
that it is his own party, and especially mentioned the Communist vote
as a positive sign. Allende also commented that the Christian Demo-
crats would have to change their ways and that elements in the PDC
would press for more support for the UP government.
Initial assessments are that Allende is probably correct in re-
garding the outcome as a personal victory for him and, to some extent,
a mandate for continuation of his governments policies. He is probably
also right that the good showing by the Socialists is a sign of his rather
than their popularity. His mention of the Communists was meant to
minimize their failure to improve their relative standing. Other signifi-
cant facts about the election are that:
The UP showing exceeded the 44 percent which Allende had
previously set as the mark beyond which he would consider the results
a victory.
The UP fell short of the 50 percent it hoped for.
The Communists did not increase their share of the total vote
from that won by them last September despite the marked increase in
the vote won by the UP coalition.
PDC remains the largest single party in the country with 25 per-
cent of the vote, and the two opposition parties together continue to
hold about 47 percent of the vote.
In the three-way race for the senatorial seat vacated by Allende
when he became president, Socialist Party candidate Adonis Sepulveda
leads with about 47 percent of the vote on the basis of an incomplete
count. The PDC was unable to persuade the third-party candidate to
withdraw from the race, which is a significant one because it is the only
test of strength above the municipal level.
This represents a preliminary analysis. I will shortly send you
fuller comments after we have had a chance to study the results
further.
2
2
See Document 220.
378-376/428-S/80023
602 Foreign Relations, 19691976, Volume XXI
219. Backchannel Message From the Ambassador to Chile (Korry)
to the Presidents Assistant for National Security Affairs
(Kissinger) and the Under Secretary of State for Political
Affairs (Johnson)
1
Santiago, April 7, 1971.
Ambassadors Report on Election Program
1. The election results have, I am convinced, proved that a strong
anti-Communist democratic opposition can be mobilized and that this
half of all Chilean political forces can exercise a significant if not deter-
minant impact on the kind of socialism that Chile will have. By any
measure, the results of our electoral program have been a success. The
Nacionales hit the maxim of their potential in the circumstances, as did
the rump Radicales. Most important of all, the PDC defined itself on
anti-Marxist grounds, took the lead in a vigorous anti-Marxist political
campaign and consolidated the Frei influence in the party as opposed
to the Tomic wing that wishes to work closely with the Communists.
PDC leadership was nervous and frankly pessimistic the week before
elections; their showing has exceeded their expectations. Frei, Ossa,
and Irureta invited themselves to dinner with me tonight as their way
of displaying their gratitude for support and for constant counsel.
2. Despite our apparent inability to assist the PDC by furnishing
critical items missing from the files on those involved in the so-called
copper plot, particularly several telexes between Santiago and Zurich,
the PDC hammering on this theme contributed to the decline of the
Orthodox Radical Party vote and thus deprived Allende of his clear
majority. If those messages could be located they would still have con-
siderable political value here in sustaining the vitality of the anti-
Communists.
3. The results in the deep south senate race confirmed our fears.
The U.P. candidate won going away and had Zaldivar been in a two-
way race the extreme Socialist would have won by a very ample abso-
lute majority. Having now gone through the presidential election expe-
rience of excellent polls and this latest example of Chilean logic, I am
persuaded that people on the spot understand their situation best and
that we should restrain our meddling to the minimum and to the
basics. The campaign of terror that had such effect on the Communist
vote this time, while missing the mark in the presidential elections, was
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172. Secret; Sensitive; Eyes Only. The message is summarized in an attached April 7
memorandum from Nachmanoff to Kissinger.
378-376/428-S/80023
November 5, 1970December 31, 1972 603
much more Chilean in inspiration and execution and did not have the
heavy imprint of outside fabrication of the presidential election effort.
2
4. Given the gloomy circumstances that prevail in Chile, I believe
optimal results have been obtained. (It should be borne in mind that in
the last municipal elections, the U.P. parties had 44.5 percent of the
vote.) The strength of the opposition in these elections will thus have a
braking effect on the PCCh and the U.P. plans. The economic circum-
stances will put enormous strains on the government in the next few
months and the working class in particular will be compelled to pay a
large share of the bill that Allende will have to present to the people in
one way or another during the remainder of this year. He may well
seek to make us the scapegoats for the rise in prices and production dif-
ficulties that are certain to come or for the measures that will reduce the
purchasing power of the masses. He may feel compelled to accelerate
his pressures on the remaining uncontrolled media and on the opposi-
tion political parties. But as long as it is the Chileans who remain out
in front as the opposition and as long as we maintain a posture of
businesslike readiness to deal pragmatically with the Chileans, it is not
impossible that surprises will develop here to support wider U.S. objec-
tives in the world. The credentials of the new Soviet ambassador would
indicate that Moscow is well aware of the stakes here, is conscious of
the economic realities and is prepared to do more if more will be
needed, as it surely will.
5. I will recommend in a separate message some modest actions
that can sustain both an indigenous opposition and our tactical flexi-
bility.
3
Given the unpromising Chilean structure, we are today, I main-
tain, in an optimal position: our relations with the Chilean Government
are correct and effective; our ability to defend U.S. business interests
has been proved in more than a dozen ways; the structure for the diffi-
cult if pragmatic negotiations over copper and ITT has been estab-
lished; Chilean obligations to U.S. creditors are being met on schedule;
USGprestige insofar as Chilean matters are concerned is very high (Ga-
briel Valdes told U.S. newsmen last week that the execution of U.S.
policy by me had been thus far extraordinarily good and that judge-
ment has been echoed by the right, the PDC, and the government); the
opposition to Communism is overwhelming and the democratic forces
in the country are still far from impotent.
6. I am withdrawing as your Action Officer. In relinquishing that
role, I recognize but do not apologize for my apostasies nor submit ex-
2
Korry reported the election results to the Department of State in telegram 1843
from Santiago, April 15. (National Archives, RG 59, Central Files 197073, POL 181
CHILE)
3
Not found.
378-376/428-S/80023
604 Foreign Relations, 19691976, Volume XXI
cuses for what some deemed excesses of zeal. The pursuit of excellence
is a manner, not a measure.
220. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, April 9, 1971.
SUBJECT
Chilean Municipal Election Results
With about 90% of the vote counted the results of Sundays munic-
ipal elections confirm the trend set by the earlier returns and give an
important victory to President Allende and his Popular Unity (UP)
Government.
A breakdown of the percentage gained by each party follows.
These are official figures with the nulls and voids counted:
Popular Unity Coalition Per Cent
Socialists (PS) 22.4
Communists (PCCh) 17.0
Radicals (PR) 8.0
Social Democrats (PDS) 1.3
Popular Socialist Union (USP)* 1.0
49.7
Opposition Parties
Christian Democrats (PDC) 25.7
Nationalists (PN) 18.1
Democratic Radicals (PDR) 3.8
Paedena and Independents 1.3
Null and Void 1.4
Total (Does not add to 100.0 due to rounding) 99.0
(*A splinter party not strictly part of the UP but which
asked that its vote be counted as part of the UP total.)
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Confidential. Sent for information. A
stamped notation on the memorandum indicates the President saw it.
378-376/428-S/80023
November 5, 1970December 31, 1972 605
The Government, however is playing a numbers game, omitting
(contrary to traditional practice) null and void ballots from the total,
and thereby giving the UP 50.9% of the vote which permits it to claim
an absolute majority. Statistical juggling aside, the major results of the
election are as follows:
The UP coalition received about 50% of the vote, give or take a frac-
tion of a percentage point either way. This is a significant gain over the
36% it won in last Septembers presidential election and over the 44%
which was generally regarded as the traditional base of the UP parties.
While the Chilean electorate traditionally is kind to a new President in
the first election following his inauguration, the results do give Allende an
increased mandate for pursuing his programs.
The election results will have a major impact on the relative
standing of the parties within the UP coalition. The Socialists, who in-
creased their share of the vote to 22.4% from 13% in the 1969 Congres-
sional elections (there was no party breakdown for the UP vote in the
Presidential elections), have supplanted the Communist Party as the
principal force in the coalition. The Communists increased their vote
only slightly to 17% compared to 16% they won in 1969. Thus, the Com-
munist position in the UP has suffered relative to the strong showing of the So-
cialists. The third major party in the UP coalition, the more moderate
Radical Party, suffered a slight absolute loss and thus a relative decline
within the UP.
The opposition made a respectable showing under the circumstances.
Taken together the opposition parties got 48% of the vote. The Chris-
tian Democrats (PDC) remain the largest single party in the country
with some 25.6% of the vote. The Nationalist Party more or less held its
own with 18.1%. Their mutual suspicion resulted in limited coopera-
tion between the major opposition parties and probably reduced their
effectiveness.
The election results are pretty clearly a personal victory for Allende
who has played his cards very deftly since his inauguration. The strong
showing of the Socialists can be attributed primarily to the fact that this
is Allendes own party. The election results will probably strengthen
Allendes authority within the UP coalition, as well as his ability to ma-
nipulate the opposition. He thus should be in a more advantageous po-
sition for accelerating the implementation of his programs. The So-
cialists, interpreting the results of the election as a victory for them, will
almost certainly press for a more rapid pace, and the opposition is
likely to be more on the defensive than in the past.
Allende has already made efforts to split off the left wing of the
PDCand bring it into the UP. If successful, the UP might gain control of
the Senate. It is unclear yet whether the results of the election were suf-
ficiently damaging to enhance the chances of a split in the PDC. The
378-376/428-S/80023
606 Foreign Relations, 19691976, Volume XXI
chances are that some individuals from the left wing of the PDC may
defect, but the party will probably hold together at least until its con-
vention next summer.
Allende had previously indicated that if he obtained a majority at
the polls, he would seek a plebiscite on a constitutional amendment to
replace the present bicameral legislature with a unicameral one. Since
the opposition controls the present legislature, and congressional elec-
tions are not scheduled until 1973, approval of such a constitutional
amendment would force early elections of a new legislature in a climate
more favorable to the UP. However, Allende has made no statement on
this subject since the election. In any event, legislation would have to be
submitted to the Congress first, and could be put to a plebiscite only if
the Congress rejects it.
In the race for the Senatorial seat vacated by Allende when he became
Presidentthe only election above the local levelthe UP candidate
Adonis Sepulveda won with just under 50% of the vote. The PDC candi-
date, former Finance Minister Andres Zaldivar, received 33%, and a
third party candidate supported by the PN received 15%. Despite
strong pressures, the PN refused to withdraw the third candidate ap-
parently preferring to preserve its position for the future, rather than
allowing the UP or the PDC to achieve a clear majority.
The elections occurred in a climate which was most favorable for
the UP, when the benefits of their actionsprice reductions, wage in-
creases, increased social welfare benefitshave been felt by the elec-
torate. Allende may find it difficult to sustain the honeymoon climate
later, however, when the impact of the Governments programs on in-
flation and production become increasingly apparent.
378-376/428-S/80023
November 5, 1970December 31, 1972 607
221. Letter From the Ambassador to Chile (Korry) to
President Nixon
1
Santiago, April 13, 1971.
Dear Mr. President:
At the White House last October you said I was one of those who
told it like it is.
2
Your predecessor, in a final chat in the same office in
late 1968, remarked that I was one of the too few Ambassadors who did
not have to be told what to do and who knew how to take initiative
and to assume responsibility. With those two gratuitous judgments in
mind, I write my only substantive letter to you who, until now, had
conferred your trust.
During these past two years and three months, as with the two
preceding administrations, I have been guided by what I consider to be
the moral contract between civil servant and his president that is essen-
tial to good and effective government. In return for undiluted loyalty, I
had the right, indeed the obligation, to set forth my views on pertinent
themes.
To me, loyalty goes beyond what every president must assume to
be the obligation of his representatives; for me, an ambassadors loyalty
demands a second effort, a positive readiness to act without instruc-
tions as a lightning rod that deflects or absorbs the bolts directed at the
presidency. It does not imply accord with every presidential percep-
tion, with every policy, with every decision; if the sum of those actions
is intolerable, he can and should resign. Yet, if he is to retain the privi-
lege of representing the presidency, then his loyalty must be dynamic.
If he believes in our institutions, if he believes that disciplined dissent
can strengthen our democratic processes, if he has faith in reason as an
effective instrument of persuasion and of progress, then he can and
should utilize those internal channels of communication that provide
for a dialogue with his Chief Executive. Such communication can at
once be provocative and proper, can be challenging and correct, dis-
comforting and disciplined.
For eight and a half years, I have abided unwaveringly by the
terms of this implied contract. I do not admit to any deviation from its
self-imposed criteria. At times, particularly the past year, the strains
provoked by an undisciplined bureaucracy have been so wounding, so
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 778,
Country Files, Latin America, Chile, Vol. I, Korry File. No classification marking.
2
Korry met with President Nixon and Kissinger on October 15, 1970, from 12:54 to
1:15 p.m. (Ibid., Nixon Presidential Materials, White House Central Files, Presidents
Daily Diary)
378-376/428-S/80023
608 Foreign Relations, 19691976, Volume XXI
slyly vicious, so nihilistic, that decency has almost succumbed to
despair.
You know better than I, Mr. President, that the wages of loyalty
can be very unrewarding. Politicians demand partisanship; bureau-
crats insist upon conformity; media feed on mendacity and muddle.
To be independent of mind and of expression yet loyal to the guard-
ian of our institutions is considered by most to be a romantic aberra-
tion, an intolerable challenge to their own aberrated norms. Dialogue
is converted into delirium, communication to chaos, loyalty to li-
cense. Every cable, even of the most sensitive variety, that I have sent
from Santiago has been aired, as I can verify after hearing the questions
of correspondents; every recommendation is placed against the meas-
ure of bureaucratic truth and then artfully leaked to destroy the non-
conforming; every action is distorted into self-serving political or ca-
reerist advancement.
For one, such as myself, who has refused to enlist in the establish-
ment of politics or of bureaucracy, the test of loyalty to the presidency
becomes a daily struggle for survival. If I am co-opted to write for Elliot
Richardson a report that becomes the basis for the findings of the Pe-
terson Task Force and for your recommendations to the Congress, my
absolute isolation from the media does not inhibit a partial, distorted
version from appearing; I am expected to prove that I did not hand it
out, that I did not form a cabal with Henry Kissinger to reduce the
powers of the State Department, that I was not being disloyal to Presi-
dent Kennedy and the activism of the Alliance for Progress and so on.
My silence is taken to be confirmation of these absurdities. If my pas-
sionate devotion to the rights of the individual, if my conviction that
the destruction of democracy anywhere affects in some measure our
own democracy, then the New York Times and Washington Post conclude
that I am a White House hard-hat who wishes hostility with Chile and
whose influence prevails; and if I had denied the charge and stated that
I had authored the State Departments recommendations that were
submitted to you in October,
3
then I would be challenged to prove that
I am not a dissident. If I seek to persuade the Johnson Administration of
the need for a low-profile manner of U.S. behavior in a continent
heaving with nationalism, then it is translated into disloyalty to the
man who plucked me from well-merited obscurity and into crass ca-
tering to the prejudices of President Nixon. If I heed the insistent exper-
tise of both the CIA and the senior State representatives in my Mission
who say it is impossible for Allende to win, then my equally insistent
caveats and doubts are disregarded by those in your government who
require scapegoats. If I take issue with a State Department convinced
3
See Document 155.
378-376/428-S/80023
November 5, 1970December 31, 1972 609
that Allendes election would have no significant consequences for U.S.
interests or for your management of our policies, then I am portrayed
as an exaggerating emotionalist. If I oppose interventionist adventures,
I am held responsible for the election of Allende; if I discreetly embark
last November on establishing an effective relationship with Allende,
discretion is prismed into hostility, effectiveness into lack of contact. If I
urge the withdrawal of U.S. forces from Easter Island because it is a
costly operation of marginal, if any, value and because its planned de-
parture would coincide inopportunely with later complex negotiations
in Chile, then those who inveigh every day against a distended U.S.
military presence and an inflated U.S. defense budget shout that it is
provocation, a display of ill-considered boorishness.
It is self-indulgence to state these sentiments to you who endure in
an hour what I may feel in a year. I yield to the impulse because I, un-
like you, Sir, have neither bureaucratic nor political loyalties nor sup-
port, because I am uniquely dependent on the presidency and because I
continue to believe that presidents require independent minds and
forthright voices within their official circle. I vent this conviction, not in
behest of a personal hearing. I have always maintained that ambas-
sadors are expendable, but I do not accept that the kind of government
executive I strived to symbolize be totally spent in the name of partisan
or bureaucratic expediency. Too many of our citizens already feel alien-
ated from our government, too many have a we and they percep-
tion to promote a further division.
I confess to profound disappointment that you have decided to
end the contract that began in Ethiopia in 1967 when I, in response to
your query, said that I would feel privileged to serve the Presidency,
whatever the prevailing political coloration, so long as my work had
significance and my views had a hearing. Yet, however pained I feel
today, however unjust I consider the lack of any rebuttal by anyone,
even now, to the calumnies that have irreparably impaired me and
mine, however persuaded I am that such conduct by the Washington
mafia will foment further deceit and decomposition in our processes of
government, pride of accomplishment in these years of opportunity of
national service remains.
I recognize my apprehensions are not universally appreciated, but
I make no apologies; I confess to excesses of zeal, but I offer no excuses.
As with loyalty, the pursuit of excellence is a manner not a measure. I
shall leave Chile convinced that, given the circumstances, we have at-
tained an optimal position. Relations with the Allende government are
correct and effective; U.S. business interests have in every instance
tested so far been compensated in accordance with our norms; a prag-
matic if difficult negotiation of the remaining copper and ITT interests
is already well advanced; the anti-Communist, indigenous forces are
378-376/428-S/80023
610 Foreign Relations, 19691976, Volume XXI
satisfied they can wage a meaningful struggle for Chiles independ-
ence; the democratic parties state they are now, in contrast to three
months ago, flexed to fight for pluralism in Chile. To attain these ends
without sacrifice of principle, without disclosure of your instructions,
without compromising the dignity of our government, without disloy-
alty within my Mission here and without flagging in my dedication to
our Presidency, has required the personal assumption of a multiplicity
of roles and of responsibilities not usually associated with ambassado-
rial performance.
Firmness, forthrightness and fairness have characterized my ef-
forts to define an acceptable relationship with the new government
here. I acted no differently, if with less success, to arrive at an equilib-
rium with our own bureaucracy. Recently, my colleagues in the State
Department issued their judgment on Chile: they had always assumed
that the Nixon policy for Latin America would inevitably lead to our
losing some countries. My reply to this curious formulation, offered at
the recent Chiefs of Mission Conference in Panama City, was that while
this conclusion had a reasonable ring, they had failed to gain the prior
policy indorsement of the President to whom I was responsible.
If I depart Chile distressed to discover that slander, or at best si-
lence, are the final judgments on my performance, I believe nonetheless
that certain contributions to the Presidency have sufficient significance
to be recorded in an attachment that I submit with this respectful fare-
well. My wife, who has been an extraordinarily loyal and effective
partner and who, as I, gave you unstintingly the best effort, joins me in
expressing our most heartfelt wishes for your attainment of peace and
prosperity for our nation.
Sincerely,
Edward M. Korry
Attachment
Undated.
1. The unmarred protection of all U.S. life and property in my juris-
diction for eight and a half years resulted in no U.S. citizen ever being
done physical harm as a result of hostile action of any kind. At no time
in some four years in Ethiopia was any U.S. installation under my re-
sponsibility menaced by crowd or other action. And for the past almost
three full years in Chile, a cockpit of nationalism, no demonstration of
any significance was mounted against any U.S. office. These results
were not happenstances but the consequences of self-starting action.
378-376/428-S/80023
November 5, 1970December 31, 1972 611
2. The African report that President Johnson commissioned in 1966
is still U.S. policy for the area.
4
It was the first official policy adopted by
our government that recognized that the costs of the Viet-Nam war and
the over-extension of U.S. responsibilities dictated a more rigorous def-
inition of our interests and a more judicious application of resources to
interest. It was also the first to apply the multilateral mechanism of
World and regional banks to support U.S. global goals and it was the
first to prompt the IBRD to a dynamic developmental role in an area.
3. The 19691970 report commissioned by Elliot Richardson was
incorporated almost in toto by the Peterson Task Force.
5
Its major rec-
ommendations were adopted by the President as national policy. It ar-
ticulated basic foreign policy themes that have since been incorporated
in the Presidents two annual foreign policy messages and in the Secre-
tarys recent yearly report.
4. A gratuitous letter to President Johnson in 1965 proposed U.S.
Government support for a world-wide satellite communication net-
work.
6
It provoked an immediate reversal of policy and the adoption of
a dynamic program that led to an Intelsat based on U.S. systems.
5. The negotiation of an accord in 1969 resulted in an unique na-
tionalization of the largest U.S. enterprise ever to be sold to a threat-
ening foreign government. Then Under Secretary Richardson wrote
that the negotiated nationalization of Anaconda was a diplomatic expe-
rience that would be a text-book classic for all aspiring diplomats for
the next 50 years.
6. The negotiation of accords for the compensation in adequate, ef-
fective and prompt form for a dozen U.S. enterprises in contemporary
Marxist-led Chile, the most notable of which was the recent sizable
Bethlehem agreement. Very significant progress has been achieved to
permit an acceptable resolution of the copper problem in Chile.
7. The blunting of all efforts designed to implicate the U.S. in im-
proper interference in Chilean political processes during the past 14
months has enabled respect for the U.S. to be maintained and U.S. in-
fluence to be retained in a tense and complex period.
8. A three year campaign from 1964 to 1967 sought to convince the
JCS, NIE and the State Department that the Soviets were seeking to
thrust down the Eastern Mediterranean, into the Red Sea and the In-
dian Ocean, a personal campaign that finally provoked the formation
4
Presumably a reference to Korrys July 1966 report on development in Africa. See
Foreign Relations, 19641968, vol. XXIV, Africa, Document 215.
5
See footnote 3, Document 192.
6
See Foreign Relations, 19641968, vol. XXIV, Africa, Document 198.
378-376/428-S/80023
612 Foreign Relations, 19691976, Volume XXI
of the Holmes Task Force that was at work at the time of the Arab-
Israeli war.
7
9. A 19671968 initiative to persuade Washington that nationalism
was about to engulf U.S. traditional interests in South America, that our
high-profile activism was incompatible with the times, and that we had
to adopt policies of the kind proposed by the Peterson Task Force.
10. The management of an Embassy that received the most enthu-
siastic inspection report of 1969, that was and is both self-reliant and
democratic, and that maintained its unity despite the tremendous
strains imposed by Washington in the past seven months.
7
See ibid., vol. XXI, Near East Region; Arabian Peninsula, Document 22.
222. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, April 14, 1971.
SUBJECT
Korrys Report to 40 Committee
You asked what Korry was talking about in para. 2 of the [less than 1 line
not declassified] message at Tab C.
2
CIA has sent a memo which explains
the matter (Tab A).
3
Korry apparently asked the Agency to help obtain
some [less than 1 line not declassified] which might have been helpful to
the PDC in its campaign attempt to link up government figures to the
so-called copper plot. (You will recall that the government charged a
number of Chileans and foreigners with a plot to lower copper prices
and damage Chiles interests; the charges backfired somewhat when
the PDC counterattacked and noted the involvement of some gov-
ernment officials in an attempt to manipulate prices for their own ben-
efit.) The CIA memo indicates that [less than 1 line not declassified] was
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 778,
Country Files, Latin America, Chile, Vol. I, Korry File. Secret; Sensitive; Eyes Only; Out-
side System. Sent for information. The memorandum was initialed by Kissinger.
2
Document 219.
3
Tab A, an April 13 memorandum from Helms to Kissinger, is attached but not
printed.
378-376/428-S/80023
November 5, 1970December 31, 1972 613
unable to recover the messages requested by Korry and that it was un-
able to develop further information which might have assisted the
PDC.
You also asked about Korrys comments in para. 3 relating to the senato-
rial race. I referred to this in my cover memo of April 7 (Tab B),
4
which
you apparently did not have when you read the message. To summa-
rize, Korry opposed CIAs efforts (which were based on the 40 Com-
mittee guidance) to persuade the third party candidate to leave the
race. The implication is that Korry did not believe the PDC candidate,
Zaldivar, would win, and hence he wanted to deny the UP candidate
an absolute majority. This is what resulted (the UP candidate received
just under 50%), and Korry feels vindicated. The assumption we oper-
ated under, however, based on Embassy reports and CIAs assessment,
was that Zaldivar stood at least an even chance of winning a two-way
race; and, therefore, we should make every effort to pull the third can-
didate out.
4
Attached but not printed. See footnote 1, Document 219.
378-376/428-S/80023
614 Foreign Relations, 19691976, Volume XXI
223. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, April 26, 1971.
SUBJECT
Letter from Ambassador Korry
Ambassador Edward Korry has sent you a personal letter which
expresses his profound disappointment that his services are being
terminated. (Tab A)
2
Korry is being replaced as Ambassador to Chile
very shortly by a career officer, Ambassador Nat Davis. He has not
been offered a comparable position elsewhere by the State Department.
Korrys letter is an emotional defense of his dedication and loyalty
to you and to the Presidency, and a recounting of the personal attacks
he has received at the hands of the State Department and the press be-
cause of his attempts to call things as he saw them and to act with initia-
tive. Korry obviously feels, with some justification, that he has been
badly mistreated. He mentions his pain that no one has rebutted the
calumnies that have irreparably impaired him and his family. He
refers to his contract with you that began in Ethiopia in 1967 when he
told you in response to your question that he would feel privileged to
serve the Presidency whatever party prevailed.
The letter also summarizes what Korry believes are his principal
accomplishments both in Chile and elsewhere.
Korry is a former journalist who writes very articulately. He has
acquired a great deal of interesting and sensitive information in his ca-
reer as an Ambassador, and he is presently carrying a bitter grudge
against the State Department and, I suspect, considerable resentment at
the White House for not defending and protecting him after his loyal
service. Although there are aspects of Korrys performances and judg-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 778,
Country Files, Latin America, Chile, Vol. I, Korry File. Secret; Sensitive; Outside System.
Sent for action. This memorandum was prepared by Nachmanoff and sent to Kissinger
for approval under cover of an April 22 memorandum that reads, Attached for your sig-
nature at Tab I is a memo to the President forwarding a personal letter from Ambassador
Korry. Your memo contains my suggestions for handling this situation. I believe this is
one case where human compassion, and perhaps justice, coincides with self-interest.
Taking these actions will not guarantee that Korry will not at some future time do
damage to the Presidents and others interests, or to our foreign relations; but human na-
ture being what it is, failure to do something for him will inevitably lead him to seek ven-
geance and self-justification. (Ibid.) At the bottom, Kissinger wrote, Also do a very
warm backchannel from me to Korry saying letter has been placed before President. No
record of this backchannel message has been found.
2
Document 221.
378-376/428-S/80023
November 5, 1970December 31, 1972 615
ment which were unfortunate, on the whole I believe he has tried to
serve your objectives as he saw them. I think it would be desirable to
try to ease some of Korrys pain at this time, both because it would be
compassionate and in the Administrations interest to avoid sending
back to private life an excessively embittered, articulate, and knowl-
edgeable potential critic.
3
I therefore suggest that you authorize me to send a copy of Korrys
letter to Secretary Rogers, and that you authorize me to tell him that:
You want to send a warm letter of praise and appreciation to
Korry (which could be quoted publicly);
You want Korry to be offered another post which is sufficiently
prestigious to salvage Korrys ego, though it need not be substantively
important;
The official announcement that Korry is being replaced should
emphasize that his service has been valued and that we hope to utilize
his considerable talents elsewhere.
If Korry returns to Washington, I believe you should receive him
for a brief office visit which could be given appropriate publicity.
Recommendation
That you approve the courses of action suggested above.
4
3
In an April 23 taped conversation between the President and Kissinger, the Presi-
dent stated, What the hell are we going to do with him if he gets out there and starts
writing his books? and Move him outta there! (National Archives, Nixon Presidential
Materials, White House Tapes, Conversation No. 4877)
4
President Nixon initialed the Approve option.
378-376/428-S/80023
616 Foreign Relations, 19691976, Volume XXI
224. Memorandum From Frank Chapin of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, May 6, 1971.
SUBJECT
ChilePDC Request for Financial Support [less than 1 line not declassified]
The attached Memorandum for the 40 Committee was circulated
by the CIA just as you were departing the city.
2
It informs the members
that CIA is prepared to respond immediately to an urgent PDC request
for [less than 1 line not declassified] certain deficits for the Partys [1 lines
not declassified].
[1 paragraph (2 lines) not declassified]
This particular assistance had been previously mentioned as pos-
sibly up-coming in CIAs memorandumto the Committee dated 28 Jan-
uary 1971 dealing with overall financial support of Chilean opposition
parties and the purchase of media outlets.
3
The [dollar amount not declas-
sified] was available within CIA approved funds.
The other members of the 40 Committee concurred in this action,
and Arnie Nachmanoff strongly endorses it as [less than 1 line not declas-
sified] performance has been most effective of late.
Recommendation
That you note your approval of CIA support in the amount [less
than 1 line not declassified].
4
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172. Secret; Sensitive; Eyes Only; Out of System. Sent for action. Concurred in by
Nachmanoff.
2
Attached but not printed is the April 27 memorandum for the 40 Committee,
Chile: PDC Request for Financial Support [text not declassified]; see Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973, Document 64.
3
Document 200.
4
Haig initialed approval on behalf of Kissinger.
378-376/428-S/80023
November 5, 1970December 31, 1972 617
225. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, May 10, 1971.
SUBJECT
Allende and Korry Meet
President Allende and Ambassador Korry met for over an hour on
May 3, their first official meeting since Allendes inauguration last No-
vember.
2
Korry describes Allende as cordial, mild, and drinking fairly
heavily throughout the interview. Ambassador Korry, who avoided
being drawn into generalities and concentrated his fire on areas of di-
rect interest to the US, made the following points in the course of the
conversation:
Allendes main economic problem would be management and
bureaucratic parochialism that could result in mis-management.
If he hoped to be successful he had to take into account the
laws of the marketplace including access to capital, technology, and
markets.
Management of the economy involved the future of US com-
panies, especially the copper companies.
While not wholly satisfied with the language of the draft legisla-
tion on copper nationalization now before the Congress, it was an im-
provement over the original language and we had also been encour-
aged by the progress of talks between the GOC and Cerro Corp. over
the nationalization of Cerros copper holdings. Korry then asked if we
could look forward to a second round of talks between the GOC and
Cerro.
In the course of the conversation Allende said that:
Of course there would be a second round of talks with Cerro.
Talks with Kennecott and Anaconda would get under way as
soon as there is an accord with Cerro and an agreed text for the nation-
alization legislation.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Secret; Exdis. Sent for information. A
stamped notation on the memorandum indicates that Kissinger saw it.
2
Telegram 2394 from Santiago, May 5, contains a full report of the AllendeKorry
meeting. See Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973,
Document 66.
378-376/428-S/80023
618 Foreign Relations, 19691976, Volume XXI
His government has no desire to be punitive nor provoke
problems with any US company, and that the interests of both parties
will be taken into account.
On more general topics President Allende:
Lashed Brazil for its anti-Chilean posture and for repression of
what he called irreconcilable forces within Brazil.
Asserted Castro was a good friend, but the Chilean and Cuban
situations are distinct.
Said that he had not received a letter from Castro advising him
to maintain the best possible relations with the US, but that such a mes-
sage had been brought to him by an intimate friend (presumably his
daughter).
Korry sought to disabuse any notion that the US was attempting to
put Chile under pressure by political or economic means, and specifi-
cally denied allegations which have appeared in the media of our in-
volvement in the Schneider assassination; of our action to choke off
credit to Chile; and of sabotage at the mines. He was somewhat taken
aback when President Allende said he had a copy of the US Embassy
Emergency and Evacuation Plan dated November 25, 1970, and asked
if Korry wanted to see it. Korry explained that E & E planning is a rou-
tine administrative task all Embassies are required to do, and has since
confirmed that there is no E & E plan bearing that date (though Allende
could conceivably have a copy of an earlier plan with an altered date).
The conversation also touched on the situation of the Ford opera-
tion in Chile (Ford plans to close down operations), International Tele-
phone and Telegraph, and the Enterprise case. In closing Allende asked
why Korry was leaving his post, expressed his appreciation for the Am-
bassadors role in arranging the Cerro talks, and asked if he could stay
in Chile long enough to deal with the major copper problem. Korry ex-
plained that his transfer at this time is routine.
378-376/428-S/80023
November 5, 1970December 31, 1972 619
226. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, May 10, 1971.
SUBJECT
Authorization for Admiral Nace, COMUSNAVSO, to Visit Chile
Assistant Secretary Meyer has recommended that the SRG autho-
rize Admiral Nace, COMUSNAVSO, to visit Chile between May 22 and
May 27 (memo at Tab A).
2
Admiral Nace has been invited by the
Chilean CNO, and Meyer suggests that withholding authorization for
the visit would run a pointless risk of offending the Chilean Navy. He
states that if the visit is approved he will see to it that Admiral Nace re-
ceives precise instructions regarding policy matters.
Ambassador Korry has sent in a cable (Tab B)
3
stating that he has
no objection to Admiral Naces visit, but he points out that the series of
high-level military visits (CINCSOUTH, CNO, COMUSAFSO, the
Chairman of the IADB and now Admiral Nace) unaccompanied by
similar attention from high-level USG civilians, raises questions about
a dual US foreign policy approach to Chile. Korry recognizes the im-
portance of maintaining close relations with the Chilean military, but
cautions against placing too much faith in the military as a block to Al-
lende. He foresees no conceivable circumstances in which the military
would attempt to thwart consolidation of Allendes Marxist and
anti-imperialist revolution. He expresses the hope that VIP military
visits can be limited in number and coordinated in Washington in
terms of our larger policy interests.
I recommend that we go ahead with Admiral Naces visit, but I
think Korrys point is well taken. An indiscriminate and unplanned
series of high-level military visits is not necessarily the most effective
way to maintain contact and influence with the Chilean military, and
may create unnecessary problems. I suggest that the Ad Hoc Working
Group on Chile be directed to plan and coordinate the programming of
high-level military visits to Chile; if there are agency disagreements at
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 774,
Country Files, Latin America, Chile, Vol. IV. Secret. Sent for action. A copy was sent to
Kennedy. In the right margin, Kissinger wrote, It is getting too much. Pentagon should
be informed to cut out future visits.
2
Attached but not printed at Tab A is a May 7 memorandum from Meyer to the Se-
nior Review Group.
3
Attached but not printed at Tab B is telegram 2361 from Santiago, May 4.
378-376/428-S/80023
620 Foreign Relations, 19691976, Volume XXI
that level, the issue should be brought to the SRG principals for deci-
sion. If you agree, I propose that you handle this informally with Under
Secretary Irwin and Deputy Secretary Packard; this approach can be
formalized subsequently at the next SRG meeting on Chile.
Recommendations
4
1. That you approve authorization of Admiral Naces visit to Chile.
2. That you suggest to Under Secretary Irwin and Deputy Secre-
tary Packard that the programming of high-level military visits to Chile
be planned and coordinated by the Ad Hoc Working Group on Chile.
4
Kissinger initialed his approval of both recommendations.
227. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, May 11, 1971.
SUBJECT
40 Committee MeetingStatus Report on Chilean Elections
You have indicated to Frank Chapin that you wish to have a dis-
cussion on the status report on the Chilean elections prepared by CIA
(Tab A).
2
The report reviews the results of the elections and concludes
that U.S. Government assistance helped:
to deny Allende the clear popular majority he sought;
the political opposition to successfully challenge the UP;
the opposition parties to regain their confidence and have the
will and ability to resist the UP;
the opposition parties to obtain media capabilities which will be
of great and continuing value in opposing the UP.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172. Secret; Sensitive; Eyes Only; Outside System.
2
Attached but not printed at Tab A is an April 21 CIA status report for the 40 Com-
mittee. See Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 62.
378-376/428-S/80023
November 5, 1970December 31, 1972 621
The report notes that all covert support was passed securely and
without arousing the suspicion of the Allende government.
In reviewing the report in the 40 Committee, you may wish to:
1. Ask if this generally optimistic assessment is shared.
2. Ask CIA how much of the previously authorized funds remain
unspent, and what its plans are for utilizing those funds.
3. Ask whether the agencies believe that continuation of a political
action programi.e., support to the opposition parties for purchase
and maintenance of media outlets, efforts to exacerbate the tensions
and splits within the UP, organizational support for the opposition
parties, anti-UP propaganda, etc.would be desirable and have a sig-
nificant impact. What, if anything, can we do to keep alive a viable and
strengthened opposition for the 1973 Congressional elections? What
can be done to strengthen cooperation between the opposition parties?
What can be done to weaken the unity of the UP coalition and its ability
to govern effectively?
4. What is the risk of exposure from continued political action pro-
grams? Is the likely impact of such programs sufficient to warrant
taking those risks?
If it appears that continued political action programs would be
worth the risks, you may want to consider whether the Agencys cur-
rent plans are sufficiently well thought-out and clear for the Committee
to approve. If not, you may wish to ask the CIA to submit a more de-
tailed paper outlining the objectives of continued political action and
specific plans prior to the 1973 Congressional elections.
378-376/428-S/80023
622 Foreign Relations, 19691976, Volume XXI
228. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, May 17, 1971.
SUBJECT
Chilean Pressure for Ex-Im Bank Loan for Boeing Aircraft Sale
The Minister of the Chilean Embassy, Pablo Valdes, called on me
Thursday, May 13 for what was supposed to be a courtesy call. How-
ever, he recalled your meeting with Chilean Ambassador Letelier on
March 23 and your offer to be of assistance to him should the need arise
in the future.
2
He said the Ambassador, presently in Chile, had instructed
him to bring to your attention a current issue related to obtaining Ex-Im Bank
financing for the purchase of Boeing aircraft (two 707s and one 727) for the
Chilean airline, LAN-Chile. Boeing and the Chilean Government ap-
parently have reached agreement in principle for the sale of the aircraft,
provided Ex-Im Bank finances 40% of the $26 million sale, and guar-
antees another 40% to be provided by private US banks.
The Minister made the following points in his conversation with
me:
Ambassador Letelier, after talking with President Allende, who
has a strong personal interest in this project, had instructed him to in-
form you of the problem and to seek your assistance in obtaining a pos-
itive Ex-Im response;
Boeing, in its preliminary consultations with Ex-Im and State
was given to understand that the Bank might not be able to proceed
with the loan for reasons not pertaining to the soundness of the project
itself, presumedly for political reasons;
While this project is not important in itself, the Ex-Im response
will be regarded as a political sign of US relations with Chile;
There is a time problem involved as the order must be placed
with Boeing in the next few weeks in order to obtain delivery of the
planes within the next year;
His government does not want to make a formal request to the
Bank until assured that it would be approved, for a turndown or exces-
sive delay in considering the proposal would create obvious problems
in US-Chilean relations which his government wishes to avoid.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H56, SRG Meetings, Chile, 6/3/71. Secret. Sent for action.
2
See Document 215.
378-376/428-S/80023
November 5, 1970December 31, 1972 623
Valdes left a copy of an Aide-Memoire which Ambassador Letelier
had presented to Assistant Secretary Meyer last week (Tab A).
3
I assured the Minister that I would inform you of his governments con-
cern over the problem and of his request for your assistance and that we
would look into the problem. I pointed out that Ex-Im makes its deci-
sions based not only on the soundness of a particular project but also in
light of the overall economic prospects for the country in question. The
Bank has to take broader factors into consideration; these are essen-
tially economic, not political. I assured him of our desire to maintain
good relations with Chile and expressed the hope that this particular
issue, whatever its outcome, would not significantly affect relations be-
tween our two countries.
Valdes indicated he would call me next week to see if anything
could be done. I again answered him that we will give careful attention
to this, but it might take some time to look into the details of this some-
what technical matter.
Ambassador Korry reports that he was pressed by Ambassador Letelier on
the Boeing sale. Letelier claimed that Ex-Ims action would be critical to
the evolution of US-Chilean relations, and that Allende would view a
refusal as hostility. Korry comments that prior to Leteliers raising
the issue, the Embassy had concluded that if an acceptable deal was
worked out between the Chilean Government and Cerro Corp. (a set-
tlement should be announced shortly), and if we wished to contain the
Kennecott and Anaconda problems, then the Ex-Im Bank should go for-
ward with the Boeing sale. He believes going forward will have a positive
impact on the remaining copper negotiations, while a negative position
would belie the Presidents declaration that we are willing to have the
kind of relations with Chile that it wishes to have with us. He also be-
lieves such a negative impact would serve to make anti-Communist
Chileans more receptive to the populist-nationalism which fuels Al-
lendes strategy. (Cable at Tab B)
4
The issue is a very difficult one. The Ex-Im Bank is strongly opposed
to financing the Boeing sale to Chile on banking groundsi.e., unfavorable
economic outlook for Chile, the Banks already heavy exposure in Chile
($400 million) and the precedent with regard to other exports to Chile.
The Bank is also concerned over possible Congressional reaction. More-
over, there is another serious political problem: the Chileans have
clearly indicated they plan to use the planes on a route which would in-
clude a stopover in Havana. If not limited to humanitarian cargo and
3
Attached but not printed at Tab A is a May 6 Aide-Memoire prepared by the
Chilean Embassy in Washington entitled, Purchase of Boeing Aircrafts for the Chilean
Air Line Lan-Chile; Financing.
4
Attached but not printed at Tab B is telegram 2595 from Santiago, May 17.
378-376/428-S/80023
624 Foreign Relations, 19691976, Volume XXI
passengers, use of a national airline on a Havana route would trigger a
suspension of aid under the Foreign Assistance Act.
I believe that State would like to go ahead with the Ex-Im loan for
the Boeing sale, but until Korrys cable had been reluctant to press
Ex-Im Bank to reverse its normal banking criteria and do something
special in favor of Chile. However, the issue has now escalated to a
level where the policy implications warrant an inter-agency review.
Therefore, State is preparing a paper for the Senior Review Group. I believe
the issue is serious enough to warrant SRG consideration, and recom-
mend that you agree to place this on the schedule at an early date.
In the meantime, pending the SRG review, I will inform the
Chilean Ambassador that we are giving careful consideration to this
problem, emphasizing again, however, that the Ex-Im Bank operates
primarily on the basis of banking criteria.
Recommendation
5
1. That you agree to consider the Ex-Im Bank/Boeing issue for
Chile at an early meeting of the SRG.
2. That you authorize me to tell the Chilean Ambassador that we
are giving careful consideration to this issue, emphasizing, however,
that Ex-Im Banks operations are based primarily on banking criteria.
5
Kissinger initialed his approval of both recommendations on May 20.
229. Memorandum From Frank Chapin of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
Washington, May 24, 1971.
[Source: National Security Council, Nixon Intelligence Files, Sub-
ject Files, Chile, 197172. Top Secret; Byeman. 1 page not declassified.]
378-376/428-S/80023
November 5, 1970December 31, 1972 625
230. Talking Points Prepared by Arnold Nachmanoff of the
National Security Council Staff for the Presidents Assistant
for National Security Affairs (Kissinger)
1
Washington, undated.
TALKING POINTS FOR 40 COMMITTEE MEETING
Wednesday, May 26, 1971
3:00 p.m.
1. Ambassador Korry requested about [dollar amount not declassi-
fied] to cover bad debts incurred by the PDC and some of its members
as the result of the recent municipal election campaign. The 40 Com-
mittee agreed by telephone poll last week to approve Korrys request
for an immediate [dollar amount not declassified] to cover those debts
which were already overdue.
2. The issue before us today is what to do about Korrys request for
the remaining [dollar amount not declassified]. As I understand it, we
have no obligation to meet the PDCs overrun. However, Korry be-
lieves the Party and its leaders are vulnerable to legal action and polit-
ical blackmail if they are unable to meet these debts.
2
3. We obviously have a strong interest in maintaining a strong op-
position in Chile, and we do not want to jeopardize the continued via-
bility of the PDC. The realistic options then appear to be (1) to provide
the full remaining [dollar amount not declassified] to minimize any risk to
the PDC (assuming this can be done securely) or (2) to cover less than
100% of the PDC debt, in order to give the Party some incentive to find
other sources of financing to avoid setting an unfortunate precedent in
which the USG is billed for every PDC cost, whether or not we agreed
in advance.
4. What are the Agencys views on this issue? (Call on CIA for its
assessment of the PDCs vulnerability and of its prospects for alternate
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172. Secret; Sensitive; Eyes Only. All brackets except those that indicate text not de-
classified are in the original. No memorandum for the record of the May 26 meeting of
the 40 Committee was found. An October 22 memorandum for the record by Peter Jessup
of the National Security Council Staff described the May 26 meeting as one for which
there were no detailed minutes prepared, due to the illness of the Executive Secretary,
only records of decision. Present for the Chile discussion at the meeting were Kissinger,
Mitchell, Packard, Johnson, Knowles, and Helms, as well as Karamessines, Nachmanoff,
Coerr, and Broe. At the meeting, the Committee approved [dollar amount not declassified].
Aid to the PDC in the amount of [dollar amount not declassified] was approved by tele-
phone by the Committee on May 20. See Foreign Relations, 19691976, vol. E16, Docu-
ments on Chile, 19691973, Document 67.
2
In the left margin of this paragraph, Kissinger wrote, Doesnt Allende know?
378-376/428-S/80023
626 Foreign Relations, 19691976, Volume XXI
sources of funding. You will also want CIAs assessment of the security
risk.)
[State will probably propose that we provide only another [dollar
amount not declassified] (for a total of [dollar amount not declassified]) to
cover the bad checks and letters of credit, but not to provide the [dollar
amount not declassified] for doctored invoices. The basic purpose would
be to try to force the PDC to find resources elsewhere; the division be-
tween checks and invoices is an arbitrary one, which would be rational-
ized on the grounds that business debts are easier to cover or to extend
than personal debts. State will probably indicate its willingness to fall
back to 100% funding if the PDC and Korry come back with a strong
case that failure to provide the other [dollar amount not declassified] will
endanger the Party.
[CIA may support the two-step approach, but indicate that it fully
anticipates that the PDC and Korry will come back quickly with a
strong case for the remaining [dollar amount not declassified].
[My recommendation is that you go along with the partial funding
approach, but with the understanding that we would be prepared to
provide the remainder on a contingency basis if Korry makes a strong
case.]
5. The Committee received a status report from CIA on the munic-
ipal elections program. It concludes that our assistance was helpful in
denying Allende a clear popular majority, and in helping the opposi-
tion parties to challenge the UP and regain their confidence and will to
resist the UP. Is this generally optimistic assessment shared?
6. I understand that a comprehensive, longer-term covert action
proposal, which will encompass and support two opposition elements,
will be submitted to the Committee shortly. We will want to take a
careful look at this as soon as possible.
378-376/428-S/80023
November 5, 1970December 31, 1972 627
231. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, May 27, 1971, 2200Z.
2819. Pass OPIC. Subject: Mills Conversation With Allende May
26. Ref: Santiago 2780 (Para 1).
2
1. OPIC President Mills summarized briefly to Allende OPICs
mandate, its specific concerns for major Chilean clients in Chile (ITT,
Kennecott and Anaconda), his hope that friendly accords could be
reached without triggering U.S. congressional and taxpayer funding of
claims, his recollection that all the referenced investments had been
made with OPIC coverage as result of GOC official invitation and com-
mitments, and his trust shared by USG that forthcoming negotiations
between GOC and companies would permit good relations to prosper
between our two countries.
2. In reply, Allende spoke for some 45 minutes in which he echoed
in more informal language his recent State of the Union rationale for his
unique road to socialism. Although he commenced by stating he would
reply first in general terms and then in specifics, he never mentioned
ITT while he dwelled on the copper situation. This omission led us to
conclude that he felt that ITT was under control but that coppers big
two would be the special case he has been seeking to make through a
series of other negotiated settlements affecting US companies. As for
Cerro, he laughingly volunteered he had been having a little trouble in
his own chicken coop but it was 99 percent settled and only a few ob-
servations might be required. As in the conversation itself, he wanted
us to understand he was in command in Chile, that he intended to ful-
fill his revolution under Chilean law and his interpretation of justice
(social as well as legal), and that the US would simply have to come to
terms with these Chilean realities. Only at one point did he offer any
hint of dealing with less than doctrical firmness with Kennecott and
Anaconda. After lashing the supposed refusal of these two to hand
over $100,000,000 in copper receipts (of which he said half were divi-
dends for the companies themselves), he asked why the US could not
grant credits to Chile so that it could pay for its nationalizations of iron,
nitrate and copper. Unlike the copper receipts story which I tend to
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Con-
fidential; Priority; Exdis.
2
Telegram 2780 fromSantiago, May 26, provides a brief summary in paragraph 1 of
the meeting between Mills and Allende and a general overview of the state of expropria-
tions in Chile. See Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973,
Document 69.
378-376/428-S/80023
628 Foreign Relations, 19691976, Volume XXI
doubt has any validity, his complaint on shrinking US credits is more
solidly grounded and doubtless was linked to the pending GOC re-
quest for EXIM financing of three Boeings.
3. In his general observations, Allende repeated the familiar cate-
chismthat he wanted excellent relations with all countries including
the US, that Nelson Rockefeller in an official letter in 1940 had credited
him for initiatives as Minister of Health that Allende interpreted as in-
spiring the US later to adopt Point Four,
3
that Chile enjoyed full lib-
erties, that there was not a single political prisoner nor any interference
with a press that was more oppositional than even the US (sic), that he
would never act to threaten US security interests and that the US
people and Congress had to understand the Chilean viewpoint.
4. Of course, the American taxpayer and the Congress would not
wish to pay claims for compensation. He as an ex-Congressman under-
stood and sympathized completely. But the Chilean people and
Congress that had elected him would not understand why foreigners
should collect exorbitant sums when Chileans were being expropri-
ated without compensation. He stressed that under Freis Agrarian Re-
form Law, the govt expropriated without compensation farms that
were poorly worked or that had not complied with social laws. He
wanted to be just and to deal with each case on its own merits. GOC
had done so in the case of Bethlehem, of Cerro, of Purina (sic) and
others; I had been of assistance in some of these cases and at an oppor-
tune moment he would so state to the Chilean people. But in judging
each case, the elements that had to be considered included the profits,
over what term, as against what fresh capital invested, the comport-
ment of the firms, etc. Cerro was a distinct case. It had not earned a
penny, it had brought high technology, it had comported itself well.
5. Chile was ready to sell the US as much copper as it wished; al-
though he doubted that we needed much. It was not acting in a dis-
criminatory manner against the US or US companies. If the copper had
been owned by Chinese, Soviet, European firms, it would be the same.
The constitutional project in Congress had been approved by 90 per-
cent of the membership. The companies also would have recourse to a
special court of law under that measure if it felt it had received unjust
treatment. Copper was the wage of Chile; it was like the air, sea and
land. A natural and national resource. He advised Mills to take 10
minutes to see the poor communities of Santiago, (poblaciones), to
view the misery with which the people had to confront the recent
flooding produced by rain, to understand why Chile would not pay ex-
3
The Point Four program of technical assistance was proposed by President
Truman in 1949 and initiated in 1950.
378-376/428-S/80023
November 5, 1970December 31, 1972 629
orbitant sums in compensation and why it needed to complete its
unique road to socialism.
6. He said that some might seek to block this road, but whatever
the sacrifice, however strong the pressures, the Chilean people would
follow it. He referred indirectly to Anaconda in addressing himself to
the problems of copper technicians. He earned 16,000 escudos a month
while some technicians gained 40,000 at the mines. Chileans now had
to be paid in escudos but foreigners could continue to work here for
dollars. However, he could not tolerate the Chilean gardener, a chauf-
feur or a doctor being paid at the mines in dollars as so-called
technicians.
7. He said he disagreed with USG on some policies, but in his State
of the Union message he had devoted only one sentence to President
Nixons policy in Viet Nam although he disagreed with it profoundly.
He disagreed, too, with our armaments policy in LatAm. Why could
not the US spend for education, for health, for land reforms, etc.?
LatAm was a powder keg and unless the US understood, it would
make a grievous error. It was the force of reason not arms that would
triumph, as in Chile.
8. Only twice could we interrupt this flow. Mills referred to his
recent meeting with the Japanese and German insurers in the context
of the high international interests in OPICs experience in Chile.
And when Allende looked to me for confirmation re the alleged
$100,000,000 in withheld dividends, I disagreed, adding that it was not
the opportune moment to discuss the point since he had forewarned us
he had only one hour for the meeting since he would attend the funeral
of a carabinero (shot the previous day by leftist extremists).
9. He concluded by stating that whatever else might be said of him,
he played the game cleanly; turning his hands up on the table, he said
smilingly, I put my cards on the table.
10. Recalling his admiration for US Amb Bowers in the 1940s, Al-
lende said he had written him a letter of friendship and of appreciation
upon his departure. I, too, would get such a letter.
Korry
378-376/428-S/80023
630 Foreign Relations, 19691976, Volume XXI
232. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, June 1, 1971.
SUBJECT
Senior Review Group MeetingCHILE, Thursday, June 33:00 pm
Last week I sent you a memo covering drafts of the two papers to
be considered at Thursdays SRG meeting, one on LAN Chiles desire
for EXIM financing to buy three jet aircraft from Boeing, and the other
on the package requested by the Chilean Armed Forces under FMS.
(Tabbed)
2
I pointed out that the Ad Hoc Groups drafts forwarded to you were
not final and would be revised prior to the meeting. We now have received
final drafts on the Boeing problem (Tabbed) and the FMS issue
(Tabbed).
3
As anticipated, revisions are not major, but there are some
changes from the earlier drafts.
The Boeing Problem
You will recall that the Chileans have asked for what amounts to
high-level political clearance on EXIM financing for the Boeings be-
fore they submit formal application for credit, and that they have indi-
cated that the planes could be used on the Cuban run. They have also im-
plied a link between our decision on this matter and their treatment of
U.S. copper investments. While they genuinely want the planes, they
are also using this issue as a lever in an attempt to pry us loose from our
restrictive credit policies.
There are two principal issues involved in the Boeing decision:
The major issue is whether to make an exception to our restrictive
credit policy in order to avoid (a) damaging the prospects for the
copper negotiations, and (b) possibly straining the correct relations we
have maintained with Chile thus far.
A subsidiary issue is the inconsistency with our Cuba policy of
providing EXIM financing for aircraft which may well be used to es-
tablish a new air service to Cuba.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Insti-
tutional Files (H-Files), Box H56, SRG Meetings, Chile, 6/3/71. Secret. Sent for
information.
2
Attached but not printed is a May 29 memorandum from Nachmanoff to
Kissinger.
3
Attached but not printed are the May 29 Options Paper prepared by the Ad Hoc
Working Group on Chile and an undated Options Paper prepared in the Department of
Defense. For the text of these papers, see Foreign Relations, 19691976, vol. E16, Docu-
ments on Chile, 19691973, Documents 70 and 72.
378-376/428-S/80023
November 5, 1970December 31, 1972 631
The revised draft alters the options structure somewhat. There are
now seven options falling within three categories:
4
A prompt and unequivocal no (Option A).
Three options providing for a conditional response, related to
Chilean actions with respect to both copper and Cuba (Options B, C,
and D).
Three options providing for a more positive response, but condi-
tional only on Chilean actions related to Cuba (Options E, F, and G).
The paper specifies that, with respect to the copper condition, we
would ideally await copper settlements before giving final agreement
to the Boeing loan, but favorable developments in the copper talks
could lead to earlier approval of the loan. (You should explore what
would constitute favorable developments.)
The three graded conditions on Cuba offered for choice in both the
conditional and more positive sets of options are:
Assurance that Chile will not fly these aircraft to Cuba.
Assurance that Chile not carry cargo to or from Cuba on these
aircraft.
That we simply inform Chile of the legal consequences of using
these aircraft to carry cargo in a Cuban service (i.e., a suspension of fur-
ther U.S. aid).
The Options are discussed on pages 1326 of the revised Boeing
paper (tabbed).
DOD takes a hard line on the Cuban issue and will probably come
down for either Option B or E, which retain the hardest Cuban line.
State will probably favor either Option D or G, depending on how firm it
wants to be on copper. Both options simply have us inform the
Chileans of the legal consequences of carrying cargo in a Cuban service.
I continue to favor Option D (Option II in the previous draft)
because:
It makes Cuba a subsidiary issue; whatever our decision, it
should be presented on banking, not political grounds.
It puts us in a reasonable posture, while permitting us to wait
out the Chileans on copper (rather than caving now to their pressure
and subjecting ourselves to more blackmail prior to a copper
settlement).
Although it carries the implication of a positive response and
hence a break in our restrictive economic policy, if the copper negotia-
tions turn out satisfactorily, such a shift would be defensible, and
perhaps inevitable if Allende treats the copper companies fairly.
4
The lettered options listed below are derived from the Options Paper prepared by
the Ad Hoc Working Group.
378-376/428-S/80023
632 Foreign Relations, 19691976, Volume XXI
The risk involved is that the Chileans may regard Option D as a
negative posture, and react as they would to a flat no. However, if we
do not have a Cuba condition, we can stress that this is being handled
as a normal banking matter (the EXIM Bank frequently takes months
to process loans of this type).
Ambassador Korry has just sent in a blast affirming his view that we
should go ahead promptly and unconditionally with EXIM financing
for the Boeings (cable tabbed).
5
He believes the Chileans would flatly
turn down any request for assurances on Cuba, and charge us with po-
litical blackmail. He also urges that failure to go ahead now with the
EXIM loan would push the GOC into harsher treatment of the copper
companies and other U.S. investments, garner sympathy elsewhere in
Latin America and the U.S. for Chiles position, damage OPIC, and
jeopardize our interests in Chile.
A point not dealt with in my previous memo is the relationship be-
tween the Chilean request and a similar desire on the part of the Peru-
vian Government to buy transport aircraft, in this case for an internal
air service. We have followed a restrictive policy with respect to Peru-
vian requests for EXIM credits. Our position on EXIM financing for
Chile has an obvious bearing on any subsequent decision on Peru.
You should also note there is a question of possible inconsistency
between our position on the Boeing issue and our position on the FMS
issue.
The FMS Issue
The options in the final draft on the FMS issue differ very little
from the version I sent you last week. The issue is whether to restrict
the Chileans to $5 million previously approved by the SRG, or to allow
them to use the $5 million to guarantee up to $10 million in commercial
credits. (The options are discussed on pages 710 of the FMS paper.)
Option 1a would provide the paratroop equipment and both C130
aircraft in the Chilean second priority category. Option 1b would in-
clude the paratroop equipment the Chileans put at the head of their list
and one C130; this option includes commitment in principle to provide
the other C130 in FY 1972.
The considerations involved in this issue are maintaining our influence
with the Chilean Armed Forces, the effect on our relations with the GOC, and
the reaction of other countries and the Congress. With respect to the latter,
we have now taken a sounding with other governments in the area, the
results of which were not available earlier. They show some ner-
vousness at the prospect of increased Chilean military capability, and
5
Attached but not printed is telegram 2868 from Santiago, June 1. The telegram is
Document 71 in Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 633
this is particularly true of Argentina and Peru. However, the main reac-
tion was, as I previously indicated, that they would be deeply dis-
turbed if it appeared that we were treating Chile equally or better than
themselves or other countries friendly to us.
State and DOD apparently favor Option 1a (the full $10 million cov-
ering the paratroop equipment and both C130s). I amnot convinced that
this is required to maintain our lines of communication with the
Chilean military and avoid a clear signal of hostility to the GOC. More-
over, the recent sounding with other governments shows that some
would feel somewhat more threatened by greater Chilean military ca-
pability than they had previously indicated. Their main reaction is still
one of possible resentment over too favorable treatment of Chile under
FMS. I see no reason for contributing to their discomfort more than we
have to in order to keep open our lines to the Chilean military. The
basic $5 million already approved by the SRG may be sufficient for this
purpose.
The main drawback of the lower level is that the Chileans may turn
to third countries as a source of supply for some of the items in priority
categories not covered by either option unless we whet their appetite
by at least giving the full $10 million; but (a) they may do this anyway,
and (b) they are likely to go to Western European sources, rather than
the Soviet bloc.
Your Talking Points for the meeting are tabbed.
6
6
Attached but not printed.
378-376/428-S/80023
634 Foreign Relations, 19691976, Volume XXI
233. Minutes of a Meeting of the Senior Review Group
1
Washington, June 3, 1971, 3:094:06 p.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger CIA
Mr. Richard Helms
State
Mr. William Broe
Mr. John N. Irwin
Mr. Charles A. Meyer Treasury
Mr. Samuel D. Eaton Mr. John R. Petty
Mr. John J. McGinnis
Defense
Mr. G. Warren Nutter NSC Staff
Mr. Armistead Selden Mr. Arnold Nachmanoff
Col. John C. Smith Lt. Col. Bernard Loeffke
Mr. Keith Guthrie
JCS
Mr. Mark Wandler
Admiral Thomas H. Moorer
Brig. Gen. Joseph Belser
SUMMARY OF CONCLUSIONS
1. Export-Import Bank Credits for Boeing Aircraft. This issue will be
referred to the President for decision by June 10. Any principal who
may disagree with the Presidents decision will retain the option of
seeking an appointment to present his views personally to the
President.
The Senior Review Group agreed that in presenting this issue to
the President for decision, the objective should be to establish a general
policy on extending credit to the Allende regime. This policy should
take into account pending expropriation of U.S. firms, the Allende gov-
ernments steady progress toward establishment of a Marxist regime,
and the impact of U.S. policy on public opinion in the United States and
Latin America.
2. Future Restrictions on Export-Import Bank Credits. The NSC staff
will consult Export-Import Bank to determine what alternative might
be available for future restriction of credit to Chile in the event the Pres-
ident decides to approve the Boeing aircraft credits.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H56, SRG Meeting, Chile, 6/3/71. Secret; Nodis. This meeting
took place in the White House Situation Room. Only the Summary of Conclusions is
printed here; for the full text, see Foreign Relations, 19691976, vol. E16, Documents on
Chile, 19691973, Document 73.
378-376/428-S/80023
November 5, 1970December 31, 1972 635
3. Foreign Military Sales (FMS). This issue will also be referred to the
President for decision.
[Omitted here are the minutes of the meeting.]
234. Memorandum From Secretary of the Treasury Connally to
President Nixon
1
Washington, June 9, 1971.
SUBJECT
Chilean Requests for Eximbank Financing for Three Boeing Jet Airliners and for
FMS Credit Assistance in the Purchase of Two C130 Aircraft and Other Military
Equipment
I wish to delineate and confirm the Treasury Departments posi-
tions on the two Chilean requests described above, as those positions
which were outlined in the Senior Review Group Meeting June 3.
2
As you know, I am quite concerned that the United States at times
tends to take actions in providing assistance, or help in other ways, to
countries which are taking action against United States economic in-
terests. To me, this makes little sense. If we continue with this ap-
proach, there is little prospect that we can even begin to bring about
any change in attitude or behavior on the part of countries taking such
actions against us. The situation in Chile is sufficiently well-known to
require that in considering their requests for assistance, we take fully
into account those actions in the economic area which either have al-
ready been taken against us or are likely to be taken in the future. This, I
believe, is clearly consonant with your view that we wish to have the
kind of relations with Chile that Chile wishes to have with us.
For these general reasons, then, the Treasury position on the
Chilean requests is as follows:
1. We believe that the Senior Review Group decision of February
17, 1971, setting a direct credit level of $5 million in FMS for Chile,
should be maintained, with no additional guarantees of private credit.
3
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H56, SRG Meetings, Chile, 6/3/71. Secret; Nodis. A stamped
notation on the memorandum indicates the President saw it.
2
See Document 233.
3
See Document 206.
378-376/428-S/80023
636 Foreign Relations, 19691976, Volume XXI
2. We believe that the Eximbank should not participate in the fi-
nancing of the sale of Boeing aircraft to the Chilean Government airline.
The possible relationship between Exim support on the financing and
the consequent progress of the copper talks is at best tenuous. The ef-
fects of an unequivocal turn down of the requested Eximbank credit are
not likely to impede the progress of these copper talks; and might even
be beneficial. Thus we support acceptance of the option for an unquali-
fied decision now against Eximbank participation; those options which
make even a qualified commitment really leave us little option at all.
3. We recommend that no changes be made to existing U.S. policy
which states that the Export-Import Bank should issue no new credits
to Chile and should reduce its export guaranties and insurance for
Chile gradually and selectively.
I am sure you will appreciate that these positions have not been
taken lightly. We are aware of the favorable balance-of-payments ef-
fects which could result from these sales, of the assistance which they
could provide for the hard-pressed aircraft industry, and of possible
public relations repercussions in Chile. At the same time, I believe that
the considerations suggested in the second paragraph are overriding. I
also believe that the effect which approval of this request could have as
a precedent for the settlement of other loan requests pending in Exim
could be most significant, since it could result in a severe limitation of
our flexibility to control our own foreign economic policies.
I hope that a Government position will be taken which supports
these views.
John B. Connally
378-376/428-S/80023
November 5, 1970December 31, 1972 637
235. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, June 9, 1971.
SUBJECT
Chile
The Senior Review Group decided on Thursday, June 3, to present
two issues concerning Chile to you for decision.
2
These are:
How to respond to Chiles request for Ex-Im Bank financing for
three Boeing aircraft for the Chilean airline, LAN-Chile.
How we should respond to Chiles request for FMS credits.
I. The Boeing Issue
Chile wants to buy two Boeing 707s and one 727 with Ex-Im fi-
nancing of 40% of the $26 million purchase price and an Ex-Im guar-
antee for another 40% to be financed by private US banks. The Chileans
have made clear that they regard our response to their request for
Ex-Im financing of the Boeing aircraft as a political decision which will
have significant impact on the prospects for the copper negotiations
and our overall relations. They have indicated they would view a nega-
tive decision as belying your public statements that we are prepared to
have the kind of relationship with Chile that it is prepared to have with
us.
The policy you approved following Allendes election involved a
two-level approach: (1) to maintain economic pressures on Chile in
order to contribute to Allendes economic problems and to help pre-
vent the consolidation of his regime; but (2) to maintain a correct public
posture to avoid giving Allende an overt political issue which would
help him to gain support in Chile and elsewhere in Latin America.
Under that approach, the Ex-Im Bank was directed to issue no new
credits to Chile and to gradually and selectively reduce its guarantees
and insurance.
This policy has been carried out successfully so far, in that eco-
nomic credits to Chile have been severely restricted while we have
avoided giving Allende a clear issue on which to attack us. The
Chileans are concerned about their international credit standing, and
have been paying their debts, negotiating settlements with expropri-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H56, SRG Meetings, Chile, 6/3/71. Secret; Nodis. Sent for ac-
tion. A stamped notation on the memorandum indicates the President saw it.
2
See Document 233.
378-376/428-S/80023
638 Foreign Relations, 19691976, Volume XXI
ated companies (including Bethlehem Steel and Cerro Corp.), and
avoiding confrontation with us.
The Boeing loan cannot be treated solely as a special case because Ex-Im
will be under heavy pressure to finance other exporter credits if it
agrees to finance Boeing. Although a total opening of credits for Chile
would not be necessary, it is clear that going ahead with Boeing would
entail some easing of credit restrictions toward Chile generally. The
basic policy issue, therefore, is whether we maintain our very restrictive credit
policy towards Chile in order to maintain pressures on a regime which
is moving toward the establishment of a Marxist state, or ease credit re-
strictions somewhat in order to (a) improve the prospects for fair settle-
ments for the US copper companies and other US investors, and
(b) maintain the credibility, both in Latin America and the US, of your
publicly correct posture towards Chile.
The advantages of allowing Ex-Im Bank to go forward with the Boeing
deal and hence accepting some easing of our credit restrictions on Chile,
are that it would:
avoid damaging the prospects for fair compensation for Ana-
conda, Kennecott and other US investments; this in turn would limit
the risk that OPIC would have to pay on its investment guarantees, to-
talling up to $400 million;
benefit the US economy, rather than letting the sale go to the
British;
maintain the credibility of your publicly correct posture and
avoid criticism that we are pushing Allende into a more radical
direction;
deny Allende a political issue with which he could gain support
in Chile, Latin America and the US;
require Chile to acknowledge and assume the debts of US com-
panies it expropriates. (Ex-Im would make this a precondition.)
The disadvantages of easing credit restrictions in this case are that it
would:
help ease somewhat the economic pressures on the GOC re-
sulting from the scarcity of foreign capital;
increase the pressures for making available other credits in the
future;
increase the Ex-Im Banks exposure in Chile, at a time when the
economic outlook is very uncertain;
could be interpreted as a softening of our stance towards the Al-
lende regime while it continues to move toward its Marxist objectives.
A subsidiary but complicating question involved in the Boeing issue is
presented by the GOCs intention to use the planes for a stopover in
Cuba enroute to Europe. While there is no legal bar to Ex-Ims fi-
nancing of aircraft under these conditions (in fact, Ex-Im has financed
aircraft for Iberia, which flies to Cuba), use of the planes for service to
Cuba would not be consistent with our overall Cuban policy.
378-376/428-S/80023
November 5, 1970December 31, 1972 639
State and JCS believe Ex-Im should be authorized to process the
loan, including providing a preliminary commitment, under normal
banking procedures, and that we should thus accept some easing of our
credit restrictions. DOD favors processing the loan, too, but only if we
obtain assurance from the GOC that the planes would not be used for
service to Cuba. Treasury does not favor processing the loan. (See Tab A)
3
State, JCS and CIA believe the GOC probably would not accept a
condition on the use of the planes to Cuba, and in fact would use such a
condition to charge us with turning down the loan on political grounds.
They propose instead that we simply inform the GOC of the statutory
provisions which may apply (i.e., suspension of AID if they ship cargo
to Cuba on their national airline). I concur.
My own feeling is that the time has not yet arrived for us to confront
Allende directly by openly drawing the line on economic credits. Some
easing of credit will not be decisive in determining whether Allende
consolidates power. On the other hand, an openly restrictive policy
would be inconsistent with our public statements on Chile (and with
our more forthcoming trade policies vis-a`-vis the Soviet Bloc and
China), and would help Allende gain sympathy in Chile and abroad,
thus making it easier for himto treat the US companies unfairly. I, there-
fore, believe that we should process the Boeing loan, but in a way which would
give us some flexibility to cancel it and cut off the flow of credit if the Chileans
do not subsequently agree to fair settlements with the copper companies.
Henry Kearns has indicated that he would do this in an indirect way by
establishing defensible banking conditions before providing a pre-
liminary commitment. Since the outcome of the copper negotiations
should be known by next fall, while delivery of the first 707 would not
occur until March 1972, we would retain flexibility to deny final ap-
proval of the loan (although Kearns points out that this could involve
some difficult questions of interpretation for the Bank if expropriatory
action is not clear-cut.)
Recommendation
That you authorize Ex-Im Bank to process the Boeing loan for
Chile under normal banking procedures, with the understanding that
could mean some general easing of credit for Chile, though subject to a
cut-off if satisfactory copper settlements are not achieved. Pete Peter-
son concurs.
4
3
Document 234.
4
President Nixon initialed the Approve option and wrote, Kbe sure Connally
knows I will cut off if given a good handle.
378-376/428-S/80023
640 Foreign Relations, 19691976, Volume XXI
II. The FMS Issue
The Chileans have requested military equipment under the FMS
program in 1971 totaling $19 million. In line with your policy directive
to maintain contact and influence with the Chilean military, the Senior
Review Group previously approved a $5 million FMS loan for Chile.
The issue we now face is whether to:
(a) allow the GOC to use $5 million in direct FMS credit to guar-
antee $10 million of commercial credits (DOD has concluded that $10
million would be the upper limit that could be accommodated within
the overall FMS ceiling.) Ten million would permit the Chileans to buy
paratroop equipment and two C130s which were the first two prior-
ities on their list, or
(b) limit the Chileans to a $5 million FMS program ceiling, permit-
ting them to buy the paratroop equipment and only one C130 (we
would agree in principle to provide the other C130 in FY 1972 under
this option).
A $10 million level would bring Chile close to the FMS levels cur-
rently projected for other major Latin American countries (e.g., Brazil,
$15 million, Argentina, $13 million). Some of Chiles neighbors would
undoubtedly be concerned about the US providing military equipment
for Chile, and most would be resentful if they did not receive substan-
tially better treatment on FMS from us than Chile receives.
State, Defense and JCS favor the $10 million level on the grounds
that:
it is the best way to maintain influence with the Chilean military;
it would help prevent Chile from turning to other suppliers
(most likely Western Europe, but possibly Soviet Bloc).
I question whether the additional influence we buy with the
Chilean military (who have shown no disposition to oppose Allende
thus far) for $10 million vs $5 million is worth the additional resent-
ment and criticism we are likely to get from other friendly Latin Amer-
icans and Congress. (A substantial FMS program for Chile might be
particularly puzzling to them in view of Allendes recent criticism of
our military assistance program as contributing to an arms race.) I also
doubt that $10 million vs $5 million is likely to be decisive in deter-
mining whether the GOC turns to other suppliers.
Recommendation
That you approve a $5 million FMS program ceiling for Chile.
5
5
President Nixon initialed the Approve option.
378-376/428-S/80023
November 5, 1970December 31, 1972 641
236. Memorandum for the 40 Committee
1
Washington, July 2, 1971.
SUBJECT
Request for Funds for the Valparaiso By-Election in Chile
1. A program covering longer term financial support for all polit-
ical parties opposed to the Allende regime is being prepared for
presentation to the Committee. The inability of the National Party (PN)
to define its program requirements has delayed submission. In the
meantime, the death of a congresswoman who represented the Chris-
tian Democratic Party (PDC) in Valparaiso has precipitated a major
electoral confrontation in Chiles second most populous city. The by-
election which will be held on 18 July is considered to be crucial since it
has become a critical bellwether factor in Allendes judgment on
whether or not to call a national plebiscite to establish a unicameral leg-
islature. The victory of a Popular Unity (UP) candidate in this by-
election would encourage him to take this major step to establish a
UP-controlled legislature. If such a plebiscite were called and won by
the UP, opposition parties would lose their political base and could no
longer hope to return to power through electoral means.
2. The UP candidate in the 18 July election is Hernan del Canto, a
member of the Political Committee of the Socialist Party and Secretary-
General of the Communist-controlled Labor Confederation (CUT). Del
Canto, who accompanied the Secretary-General of the Communist
Party (PCCh) on his April 1971 visit to Moscow, has already identified
his candidacy with the revolutionary and popular forces seeking to
carry out the revolution to which the Allende government is dedicated.
His campaign is being supported by all the top personalities of the UP,
and President Allende has already made one visit to Valparaiso. Al-
though UP National Committee Chairman Adonis Sepulveda has ob-
served that this election is not a plebiscite but we understand its great
importance it has become increasingly clear that Allende and his gov-
ernment do regard the election as a critical test of strength.
3. The opposition candidate, Oscar Marin, is a former member of
the Radical Party who worked in favor of PDC Presidential candidate
Radomiro Tomic in the 1970 elections. Although formally nominated
by the PDC, Marin is being fully supported by the entire democratic
opposition, including the National Party (PN) and the Democratic Rad-
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
19711972. Secret; Sensitive; Eyes Only.
378-376/428-S/80023
642 Foreign Relations, 19691976, Volume XXI
ical Party (PDR), and also hopes to obtain some Radical Party votes.
Each of the opposition parties will need to carry out a separate cam-
paign in order to appeal to its own electorate, and each party has solic-
ited and received commitments of financial support from textile in-
dustry owners, mining companies, and other business interests in the
Valparaiso area. The willingness of Chilean businessmen to support
Marins campaign is encouraging, but the election is so important that
it would be imprudent to rely exclusively on the promise of this local
support. The following sums are, therefore, requested to assist each
party in its electoral campaign on Marins behalf:
PDC: [dollar amount not declassified]
PN: [dollar amount not declassified]
PDR: [dollar amount not declassified]
4. The funds requested will be passed to each party [less than 1 line
not declassified], and the degree of risk is considered to be low. The
funds will be used by each party to pay for propaganda (radio, press,
posters, leaflets, wall paintings); for voter transportation to the polls;
and for all other possible efforts to insure a maximum turn-out of
pro-Marin votes. Because of the short time remaining before the
election, these funds should be passed to the opposition parties
immediately.
5. During a 30 June meeting with CIA officers in Washington, Am-
bassador Korry stressed the importance of insuring an opposition vic-
tory in the Valparaiso election in order to forestall a plebiscite on the
issue of a unicameral legislature.
2
The Ambassador had previously ap-
proved a proposal that [dollar amount not declassified] be made available
to the PDC for this by-election.
6. It is recommended that, if possible, the 40 Committee approve
by telephonic vote the immediate passage of $150,000 to the opposition
parties as described above.
2
No other record of this meeting has been found.
378-376/428-S/80023
November 5, 1970December 31, 1972 643
237. Memorandum for the Record
1
Washington, July 6, 1971.
SUBJECT
Minutes of the Meeting of the 40 Committee, 6 July 1971
PRESENT
Mr. Mitchell (Acting Chairman), Mr. Johnson, Admiral Moorer, and General
Cushman. Mr. Kissinger and Mr. Packard were unable to attend. Colonel
Richard Kennedy represented Mr. Kissinger.
Messrs. Charles A. Meyer, Wymberley Coerr, Arnold Nachmanoff, Thomas
Karamessines, and William Broe were also present.
1. Chile
The request for funds for the Valparaiso by-election in Chile made
by the Santiago Station and endorsed by Ambassador Korry for
$150,000 was approved by the Committee on 6 July 1971 following a
discussion among the principals.
Mr. Broe summarized the importance of the election, noting that it
was the first time the opposition to Allende had united and an Allende
candidate victory might encourage a national plebiscite to abolish
Congress and install a unicameral legislature.
Mr. Mitchell inquired whether the PDC raised any money on their
own and also whether the money could be effectively utilized between
now and 18 July.
Mr. Johnson thought $150,000 was considerable money for two
weeks input.
Mr. Broe indicated the PDC was not particularly effective in
raising their own funds and that much of the money would go to pay
media, buy radio time, etc. He pointed out that the Chilean record was
good and they notified us of their expenditures. [1 lines not declassi-
fied]. He indicated that expenditures could be controlled by feeding the
money in gradually.
Mr. Broe provided the following figures for the Valparaiso District
to show the closeness of this election:
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
Minutes of 40 Committee. Secret; Eyes Only. Drafted on July 8. A copy was sent to
Mitchell, Packard, Johnson, Moorer, and Helms.
378-376/428-S/80023
644 Foreign Relations, 19691976, Volume XXI
1970 (Presidential) 1971 (Municipal)
PDC 33.7 Tomic Opposition 49.7
UP 33.3 Allende and
PN 33.0 Alessandri UP 48.3
The principals were convinced of the importance of the by-election
and unanimously supported the funding.
2
[Omitted here is discussion unrelated to Chile.]
Peter Jessep
2
The Christian Democratic Party candidate won a close-fought election against the
UP candidate on July 18. (Ibid., Chile, 19711972)
238. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, July 22, 1971.
SUBJECT
Boeing Loan for Chile
You asked for an explanation of the decisions on the Chilean re-
quest for Export-Import Bank financing for three Boeing aircraft for its
national airline, LAN-Chile (Tab A).
2
First, you should understand that Chiles submission of a formal
application to the Export-Import Bank on July 7, despite the fact that
we had not given any indication the loan would be favorably received,
was something over which we had no control. The Chilean Govern-
ment made a unilateral decision to submit the loan application in an at-
tempt to press the issue and force our hand. For Kearns to have refused
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Secret. Sent for information. Kissinger ini-
tialed the memorandum.
2
Attached at Tab A is a July 7 memorandum from Nachmanoff to Haig, on which
Haig wrote, hold for HAK. Kissinger wrote the following on the memorandum,
Arnie, I would have warn the President ruled against it [Ex-Im Bank loan to Chile to
purchase Boeing aircraft]. This now is the explanation we rejected. I want an immediate
explanation.
378-376/428-S/80023
November 5, 1970December 31, 1972 645
to even accept the application would have, in effect, constituted a flat
rejection of the Chilean loan request, which was not the option the Pres-
ident chose.
The following is a review of the decisions on this matter:
The President approved (memo of June 9, Tab B)
3
authorizing
the Ex-Im Bank to process the Boeing loan under normal banking pro-
cedures subject to a cut-off if satisfactory copper settlements are not
achieved. He wrote the comment on the memo be sure Connally
knows I will cut off if given a good handle. At the same time, he also
approved a $5 million FY 1971 FMS program ceiling for Chile.
On June 11, per General Haigs telephone instructions, we held
up implementing the Presidents decisions as a result of charges in
Chile of CIA complicity in the murder of former Minister of Interior
Perez Zujovic, pending a statement by the GOC refuting those
charges.
4
In my memo of June 14 (Tab C)
5
I came back to you requesting
authority to proceed with implementing the Presidents decisions
when the GOC made a satisfactory public denial of CIA involvement.
You wrote on the memo NoPresident approves FMS. Does not
want to proceed on Boeing pending urgent review of expropriation
problems.
June 18, you signed a memo to the bureaucracy (Tab D)
6
in-
forming them of the Presidents decision to approve a $5 million FMS
ceiling for Chile for FY 1971 and to defer a decision on authorizing the
Ex-Im to process the Boeing loan for Chile.
As the matter now stands, we are deferring decision on the
Boeing loan pending review of NSSM 131, the Expropriation Study.
7
When Kearns accepted the formal application from the Chileans,
he was careful to give the Chileans no commitment nor any indication
the request would be given positive consideration by the Bank. He
cited a number of banking criteria Chile must meet before the Bank can
consider the application. Basically, we are keeping our options open
and presumedly we can face this issue again after the NSSM 131 re-
3
Tab B is printed as Document 235.
4
The Communist and Socialist Parties accused the United States of involvement in
the June 8 murder of Perez Zujovic. The alleged assassins were killed in a gunfight with
police on June 13. (Juan de Onis, 2 Assassination Suspects Slain in Chile, New York
Times, June 14, 1971, p. 3)
5
Tab C is attached but not printed.
6
Tab D is attached but not printed.
7
NSSM 131, June 23, is Document 155 in Foreign Relations, 19691972, vol. IV, For-
eign Assistance; International Development; Trade Policies, 19691972. The response to
NSSM 137 is Document 157, ibid.
378-376/428-S/80023
646 Foreign Relations, 19691976, Volume XXI
view. Our basic approach on this, I continue to believe, should be to
string the Chileans along until we see how the copper settlement turns
out.
239. Briefing Memorandum From the Acting Assistant Secretary
of State for Inter-American Affairs (Crimmins) to the Deputy
Under Secretary of State for Economic Affairs (Samuels)
1
Washington, July 28, 1971.
Possible Meeting with Kennecott
The Kennecott Copper Corporation is calling on various U.S. Gov-
ernment officials in connection with its filing of an OPIC claim and its
stated desire to enlist official U.S. Government support to obtain just
compensation for its properties in Chile.
2
Kennecott President Frank
Milliken and two other Kennecott officials (Michaelson and McCreary)
called on Assistant Secretary Meyer on July 23 and left with him a letter
addressed to the Secretary. A copy of the letter and of the telegram re-
porting the meeting are attached at Tabs A and B respectively.
3
Mil-
liken also left with us a copy of a 64-page legal brief prepared by Cov-
ington and Burling which concludes that Any award by Chile . . . of
less than $176 million would fall below the accepted international legal
standard of compensation for expropriation.
1
Source: National Archives, RG 59, Central Files 197073, INCOCOPPER CHILE.
Secret; Exdis. Drafted on July 26 by Girdler and concurred in on July 27 by Fisher and
Feldman.
2
On July 11, the Chilean Congress adopted the constitutional reform that author-
ized Allende to immediately nationalize the holdings of Kennecott, Anaconda, and the
Cerro Corporation. (Juan de Onis, Allende Accuses U.S. Copper Intrests, New York
Times, July 12, 1971, p. 1) Allende signed the constitutional reform the next day, and Law
17,450 was promulgated on July 15.
3
Attached at Tab A is a July 23 letter from the President of Kennecott Copper Cor-
poration Frank Milliken to Rogers. In it, Milliken states that the compensation proposed
to be paid under the Constitutional Reform would not meet the standards of generally
accepted principles of international law. Milliken requested that the Department of
State officially intervene on our behalf with the Chilean Government to obtain payment
of just compensation for properties taken in accordance with international law. In Tab B,
telegram 134457 to Santiago, July 24, the Department of State notes that, In response to
Kennecott representation, I [Meyer] reconfirmed Depts continuing keen interest in equi-
table treatment of U.S. investors by Chilean Government, noting that problem of growing
economic nationalism throughout Latin America was one of increasing concern to U.S.
Government. Both tabs are attached but not printed.
378-376/428-S/80023
November 5, 1970December 31, 1972 647
Kennecotts Situation
In 1915 Kennecott bought 96% and subsequently all of the Braden
Copper Company, owners of the El Teniente mine. On December 3,
1964, the Chilean Government reached agreement with Kennecott to
purchase 51% of the Braden Copper Company for $80 million. As part
of the agreement the Chilean Government permitted the physical
assets of El Teniente to be revalued to their market value as determined
by an appraisal carried out by an American appraisal company. The re-
valuation raised the net worth from approximately $75 million to ap-
proximately $288 million. The agreement provided that the successor
company would increase capacity from 180,000 tons to 250,000 tons per
year. Kennecott agreed to re-lend to El Teniente the payments on the
notes representing the purchase price and to assist in obtaining bank
loans of approximately $100 million. The management of the firm was
delegated to Kennecott for 15 years and various tax and convertibility
advantages were given by the Chilean Government.
The Allende governments copper-nationalization constitutional
amendment became law on July 16, 1971, and shortly thereafter the
Chilean Government took over complete management of the affected
mines. Teniente manager Robert Haldeman, under vituperative attack
from the government-leaning press, had left the country shortly before.
U.S. Government Position
The U.S. Government has from the outset made clear to the new
Chilean Government the importance it attaches to equitable treatment
of U.S. investment. We share many, at least, of Kennecotts reservations
about the terms of the constitutional amendment, and we are deeply
concerned that equitable treatment, especially for Anaconda and Ken-
necott, may not be provided. The Chilean Government is fully aware of
the intensity of our concern in this regard, which we are continuing to
convey in every appropriate way. Our desire from the beginning has
been to help bring about an atmosphere conducive to positive and se-
rious negotiations as free as possible of rancor and emotional charges of
exploitation and economic aggression. We remain (and I recommend
that you convey this to Kennecott) dedicated to this goal and desirous
of maintaining our continuing contact with company officials both here
and in Santiago. I also recommend that you attempt to draw Kennecott
out on what specifically it hopes to obtain from us in the way of
support.
378-376/428-S/80023
648 Foreign Relations, 19691976, Volume XXI
240. Telegram From the Department of State to the Embassy in
Chile
1
Washington, July 31, 1971, 0057Z.
139331. Subject: Copper Negotiations.
1. We are considering best means of bringing US influence to bear
on GOC negotiations with companies now that copper bill is law. It is
clear that Allende has authority to set period of payment, form of pay-
ment and interest rates as well as alleged excess profits to be deducted
from compensation. Contraloria General
2
is charged with determining
the book value of the companies as of December 30, 1970 less revalua-
tions after December 31, 1964. It is also his responsibility to determine
the other offsets provided by the constitutional amendment. His deci-
sions are subject to appeal by the state or the companies to the Special
Tribunal established by the amendment.
2. It is not clear whether companies can negotiate with GOC Min-
isters to any meaningful extent on issues within jurisdiction of Contra-
loriae.g., valuation, deductions, and related accounting matters. An-
other question is to what extent companies may be able to make direct
presentation to Contraloria on such matters as theories relating to book
value or interpretations of other provisions of the law. (For example,
Kennecott might possibly wish to argue that the provisions of the
copper bill disallowing revaluations does not apply to its case, or even
if it applies to the specific revaluation accepted by the Frei Govern-
ment, that it does not preclude some revision of historic book value
more consistent with real value.) We hope that GOC replies to ques-
tions recently put by Anaconda will shed some light on procedures
Contraloria will follow.
3. There is a further question, however, as to the strategy the
United States should adopt concerning the relationship between the
Allende government and the Contraloria. If it should appear, for ex-
ample, that the GOC can and will control the Contraloria, it would
probably be in our interest to encourage the GOC to influence the Con-
traloria to implement agreements negotiated between the GOC and the
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Se-
cret; Exdis. Drafted on July 30 by Feldman; cleared by Fisher, Morgan, and Emmons; and
approved by Crimmins.
2
The Contralor a was the office in the Chilean Government that ensured various
government agencies in Chile spent their funds according to the law. In addition, it re-
viewed for legality all supreme decrees issued by the government, as well as the resolu-
tions of the ministries and their dependencies. The Contralor a General headed the office,
and had the same (lifetime) tenure and security of a judge. (Airgram A239 from San-
tiago, August 3; ibid., POL 15 CHILE)
378-376/428-S/80023
November 5, 1970December 31, 1972 649
companies. On the other hand, if, as seems to be the case, the Contra-
loria is an independent office, it may be in our interest to avoid any ac-
tion that would subvert his independence. The problem may be that
even if the Contraloria remains independent and proceeds objectively
and impartially, the copper bill may not allow enough discretion to
permit him to set compensation at an amount that would be acceptable
to the companiesparticularly Kennecott. This remains to be seen.
4. We would appreciate your comments on the foregoing and your
continuing reporting on the character and operations of the Contra-
loria, the constitutional court and the special tribunal once it is
constituted.
Rogers
241. Special National Intelligence Estimate
1
SNIE 9471 Washington, August 4, 1971.
The Outlook for Chile Under Allende
Note
In the first nine months of his government of Popular Unity, Presi-
dent Salvador Allende has moved skillfully and confidently toward his
declared goal of building a revolutionary, nationalistic, and socialist
society on Marxist principles. His problems are mounting; but he is
still firmly in control, most of his policies enjoy wide popular support,
and his ability to manipulate the levers of power is growing. His
strategy and timetable are impossible to predict in detail. The purpose
of this estimate is to make a general assessment of Allendes course and
its likely effect on Chiles internal institutions and external relations
over the next few years. In it we examine the strengths and weaknesses
of Allendes governing coalition and the opposition parties, the role of
the military, the state of the economy, and the new look in Chiles for-
eign relations. In a final section we advance some general propositions
about Allendes future problems, factors affecting the survival of a
1
Source: Central Intelligence Agency, NIC Files, Job 80B01046A, Deputy Director
of Intelligence, Registry of NIEs and SNIEs. Secret; Controlled Dissem. The full text of the
SNIE is Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 78.
378-376/428-S/80023
650 Foreign Relations, 19691976, Volume XXI
competitive, multiparty political system, and the outlook for Chiles re-
lations with the US and other nations.
Summary and Conclusions
A. Since it assumed power last November, Salvador Allendes
government has quickened the pace of ex-President Freis revolution
in liberty, and set in motion a major transformation of the Chilean
economy and society, posing new challenges to the traditional political
order. The ruling Popular Unity (UP) coalition is dominated by Al-
lendes loosely organized, militantly radical Socialist Party, and the
better disciplined, more cautious, pro-Moscow Communist Party. De-
spite disagreements over tactics and timing, the Socialists and Commu-
nists have worked together for years, and there is little short-term pros-
pect of a split serious enough to drive one or the other out of the
coalition.
B. The most important opposition party is the Christian Democrats
(PDC). It is still the largest single party, with a strong position in
Congress, but is factionalized and in financial trouble. Its relations with
the other significant opposition party, the conservative National Party,
normally are bad. Their recent joint efforts in a congressional by-
election produced a victory, and further ad hoc collaboration is likely,
but mutual hostility is so great that sustained collaboration against the
UP is unlikely.
C. Thus far the regime has directed its economic policies toward
popular political ends, concentrating on the takeover of major indus-
tries and private banks, acceleration of agrarian reform, and the redis-
tribution of income in favor of the underprivileged. Now inflationary
pressures are rising as accumulated stocks are exhausted and produc-
tion has not kept pace with demand. Imports are rising rapidly and
Chiles foreign exchange reserves are dwindling. Potentially, copper
export earnings could produce the required foreign exchange, but
likely production increases at expected prices would not permit Al-
lende to continue to meet increased demands and appetites of the pop-
ulace. If accelerated inflation, black markets, and serious shortages are
to be avoided, by early 1972 Allende will have to take some politically
unpopular actions and seek more outside aid.
D. Allendes dilemma is that, having done all the easy things, he
has still not gained sufficient political strength to carry him surely
through the difficult times ahead. His popularity seems almost certain
to decline as economic problems set in. Many in the coalition would
like to avoid the 1973 congressional election, and pave the way to their
own extension of power, by holding a plebiscite to replace Congress
with a unicameral Peoples Assembly, which they would expect to
control. But we do not think Allende can count on the electorate to ap-
378-376/428-S/80023
November 5, 1970December 31, 1972 651
prove such a change at this point and is more likely for the time being
to try to exert maximum pressure within the present system to damage
the political opposition, or to woo away some of its factions.
E. He might at some critical point turn to more drastic measures,
including some unconstitutional moves, but would do so only if he
were sure that he had neutralized or had the support of the armed
forces. The Chilean military are not now disposed to political interven-
tion. Allende has been assiduously cultivating them to gain their sup-
port, and he seems unlikely to provoke them with blatant acts. But do-
mestic events beyond his control, e.g., a deterioration of the economy
leading to severe social unrest, could trigger a military attempt to inter-
vene with, or even to oust Allende.
F. Thus the consolidation of the Marxist political leadership in
Chile is not inevitable, and Allende has a long, hard way to go to
achieve this. Though he would almost certainly prefer to adhere to con-
stitutional means, he is likely to be impelled to use, and to rationalize,
political techniques of increasingly dubious legality; eventually he is
likely to feel it necessary to employ his considerable Presidential
powers to change the political system so that the UP coalition can
perpetuate itself in control. The factors operating for and against this
outcome are nearly evenly balanced; the actual outcome could be dic-
tated by quite fortuitous circumstances at some key moment.
G. In foreign relations Allende is charting an independent nation-
alist course for Chile. He is trying to keep open the possibility of credits
from European, Japanese and other non-Communist countries. Rela-
tions with Communist countries have been expanded and will continue
to grow closer. The Soviet Union and other East European states are ex-
tending credits and they would probably help Allende in an economic
crisis with selective aid measures. Moscow will continue to cultivate
channels of influence into Allendes government through the Chilean
Communist Party, but will be unsure of its ability to make a decisive
impact on key issues, given the strong position of the Socialists and Al-
lendes independent posture.
H. At the moment US-Chilean relations are dominated by the
problems of nationalization. There is likely to be considerable conten-
tion before the issues are settled and neither the US companies nor the
radical Chileans will be satisfied by the terms. Allende himself seems to
wish to avoid a confrontation, but as economic difficulties set in there
will be a continued tendency to use the US as a scapegoat. The US reac-
tion will be important, but at least some worsening in the present cool
but correct relationship seems likely.
[Omitted here is the Discussion section.]
378-376/428-S/80023
652 Foreign Relations, 19691976, Volume XXI
242. Memorandum of Meeting
1
Washington, August 5, 1971, noon.
PARTICIPANTS
Orlando Letelier, Ambassador of Chile
Pablo Valdes, Minister Counselor of Chilean Embassy
Henry A. Kissinger, Assistant to the President for National Security Affairs
Arnold Nachmanoff, National Security Council Staff
Ambassador Letelier opened the meeting by briefly reviewing the
history of Chiles efforts to obtain financing from the Export-Import
Bank for three Boeing aircraft for LAN-Chile.
Dr. Kissinger indicated that he did not get involved in individual
loan matters, though he was familiar with this case.
Ambassador Letelier stated that he had presented documents to
the Export-Import Bank that morning with reference to three points
which had been raised by Henry Kearns, President of the Export-
Import Bank, when Kearns accepted the Chilean application for a loan.
The Ambassador said that he had indicated to the Export-Import Bank
that it was impossible for the Chilean Government to define the
amount of compensation it would pay to the copper companies at this
time, since this would be set by an autonomous agency, the Contra-
loria,
2
which was not under the control of the Government. He empha-
sized, however, that Chile would follow all the principles of interna-
tional law and its own internal laws in establishing compensation for
the companies.
The Ambassador indicated that if the Boeing planes were not
available, the only real alternative Chile would have would be to buy
Soviet planes. Chile needs long-range aircraft, and the only equivalent
to the 707s were Ilyushin turboprops. He stated that a decision already
had been made in principle to buy the Soviet planes, but that this
would be a tragedy for Chilethe Soviet planes were much more ex-
pensive (around $100 million); LAN-Chile would have 50% U.S. planes
and 50% Soviet planes, which would present problems and might even
require shifting the fleet completely to Soviet planes. The Ambassador
indicated that he had spoken to President Allende just a few days ago
and told him that he would discuss this issue with the U.S. Government
one more time to see if a solution could be found. He stated that he was
about at the end of his deadline. He realized that if Chile were forced to
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Confi-
dential; Exdis. The meeting took place in Kissingers office.
2
See footnote 2, Document 240.
378-376/428-S/80023
November 5, 1970December 31, 1972 653
buy Soviet planes it would create political problems. It would be unfor-
tunate if the Boeing issue could not be resolved satisfactorily, particu-
larly since this is happening in the middle of the copper negotiations,
which may be affected.
Dr. Kissinger commented that the reverse was also true.
Ambassador Letelier agreed, but stated that there was a timing
problem. Chile cannot accelerate the procedures for establishing com-
pensation for the copper companies. This will take three to six months.
He emphasized that Chile would have serious internal problems
during this period because of the need for the planes. He also noted
that Boeing had put up money, and was calling him every day.
Dr. Kissinger noted that his function was not to solve the problems
of American business. He again reiterated that he did not handle indi-
vidual loans. Dr. Kissinger recognized that the question of compensa-
tion must be worked out directly by the Chilean Government and the
companies concerned. However, he suggested that the Ambassador
must recognize that we have serious problems; there are enormous
pressures in this country for taking a stronger stand on expropriation
issues. He noted that there are some elements within the U.S. Govern-
ment who want to cut off all loans until expropriation cases are re-
solved. Dr. Kissinger went on to say that the Boeing case is being han-
dled essentially on a commercial basis; he indicated that he was
familiar with it only because he was told that the Chilean Government
attaches political importance to it, but again asserted that it is a banking
problem.
Ambassador Letelier stated that all of the expropriation cases in
Chile had been resolved satisfactorily thus far.
Mr. Nachmanoff noted that agreements had not yet been signed
with Cerro and Ralston-Purina.
Ambassador Letelier stated that he did not see any financial
problems with the Boeing loan, and he did not believe the Ex-Im Bank
saw any financial problems. Bank officials had indicated to him that
they were concerned about the reaction in the Senate and other sectors,
and it thus appeared to be primarily a political problem. He wondered
if Dr. Kissinger could clarify these political aspects so that the loan
could go forward. He also noted that this was not an AID loan.
Dr. Kissinger indicated that because of the U.S. Governments in-
terest in maintaining good relations with Chile, he would take a look at
this matter, but emphasized that he had not taken an active role in this
loan, and that he was not sure he wanted to get into these commercial
matters.
Ambassador Letelier commented that little things like the three
planes, can have an important effect on overall relations.
378-376/428-S/80023
654 Foreign Relations, 19691976, Volume XXI
Dr. Kissinger stated that he was very reluctant to intervene in indi-
vidual loan cases. He also pointed out to the Ambassador that what he
said about little things affecting overall relations should be taken into
account by the Chilean Government too. He recognized that timing
was a problem, but noted that in his experience gratitude does not usu-
ally play a role in foreign relations; he did not find that countries gener-
ally felt particularly indebted after actions favorable to them had al-
ready been taken.
Upon departure, Ambassador Letelier expressed the hope that Dr.
Kissinger might be able to come to Santiago.
Dr. Kissinger stated that he would like to visit Latin America and
include a visit to Chile if he could find time in his schedule sometime in
the future.
243. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, August 9, 1971.
SUBJECT
Rumor Concerning Chilean Intervention
At a social occasion this weekend, a friend who is close to a study
group working on Latin American positions for Democratic candi-
dates, told me he thought I should be aware of a rumor which is
floating around town concerning Chile. According to him, the story
being circulated is that:
Last October you met with a representative or representatives of
the copper companies and encouraged them to go ahead with a plan to
try to overthrow Allende. You reportedly told them that their objec-
tives were consistent with yours, though you would have to disavow
them, of course, if their efforts became known publicly.
The CIA was allegedly authorized to cooperate with the copper
companies in this effort to overthrow Allende.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Secret; Outside System. Sent for information.
Sent through Haig who initialed the memorandum. Kissinger wrote at the top of the
page, Total nonsense. I have never met any copper company people.
378-376/428-S/80023
November 5, 1970December 31, 1972 655
Senator Fulbright reportedly became aware of the plans and
called Helms in for a private meeting, at which time he warned Helms
that if the overthrow efforts were not called off, he had enough evi-
dence to blow the whistle publicly and would do so.
The overthrow plan was reportedly called off as a result of Ful-
brights warning, but Fulbright and others will be watching very care-
fully to see what the administration does when Allende runs into an
economic crunch.
I, of course, indicated that I knew nothing of such a plan, and said
the whole story sounded ridiculous and far-fetched to me. I am passing
it on to you, however, for whatever it is worth.
244. Memorandum From Secretary of the Treasury Connally to
President Nixon
1
Washington, August 10, 1971.
SUBJECT
Designation of a Special Presidential Envoy Regarding Expropriations in Chile
I am very concerned with the deterioration of the situation in
Chile. The Leftist Activists are making further inroads, and the negoti-
ations on the compensation of copper and perhaps other properties
look as if they will result in nothing but a disguised confiscation.
The situation is all the more difficult because the United States
Government lacks adequate representation in Santiago at this critical
time. Incumbent Ambassador Korry is a lame duck (moreover, he is
presently in New York with his gravely ill father). The Ambassador
Designate Davis is still in Guatemala and several weeks away from
Senate confirmation. The No. 2 man is on vacation, and the Embassy is
managed by the No. 3 man who has only been there for 100 days.
It may be too late to divert the Chilean Government from its in-
tended course of virtual confiscation of this important foreign prop-
erty. However, I believe the U.S. must make every effort to clearly com-
municate to the Chilean officials that if they are reasonable, we will work
to restore their international credit standing, and if they are unreasonable,
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Confidential. This memorandum is attached
to Document 245.
378-376/428-S/80023
656 Foreign Relations, 19691976, Volume XXI
we will take active efforts to deny them additional credits not only from
the United States and multilateral authorities but from other donor
countries too. They must be able to see the benefits they would be de-
nying their people through their own unreasonable actions.
Much is at stake: the United States cannot permit high-handed,
disguised, confiscatory procedures by Chile to become a blueprint for
action by others. Second, huge direct investments (and potential tax
losses) are involved. Third, it is in our interest to facilitate the develop-
ment of the mineral resources of Chile. That country is practically
unique in the resources it has under soil. The minerals could be devel-
oped in a way helpful to the aspirations of Chile and helpful to our own
increased dependence upon minerals from foreign sources. My at-
tached tables
2
show we are 100 percent dependent on chromium, plat-
inum, and tin for example. Nickel, manganese, bauxite, and zinc also
rank over 50 percent today. By 1980 the list will be far longer and our
dependence even more certain.
Time is running out: the copper expropriation was effective July 16
and the 60-day negotiating period is already running. We will not be
able to get our new Ambassador in place soon enough to help. Conse-
quently, I recommend that you appoint immediately a Special Presi-
dential Envoy to communicate to President Allende that it is your ob-
jective to be helpful to Chile if they are reasonable, but to deny them
credit facilities if they are unreasonable. I would suggest the Special
Envoy not be chosen from State. I have in mind men such as George
Woods, John McCloy, Bob Anderson, or Bob Murphy. Each has the
ability and stature and would be fully capable of communicating in a
meaningful way the U.S. Government policy. If this approach is suc-
cessful, we will display a posture of constructive leadership. If it is un-
successful, we can honestly say we tried, that Allende did not act out of
ignorance of U.S. policy, and we will be in a better position to work on
this problem in other areas at an earlier stage.
John B. Connally
2
Attached but not printed.
378-376/428-S/80023
November 5, 1970December 31, 1972 657
245. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, August 12, 1971.
SUBJECT
Appointment for Ambassador Korry (Chile) Today or Tomorrow
Ambassador Korry is in town until tomorrow evening and would
very much like to talk with you. (He came up suddenly because of his
fathers death.) I think it would be useful for you to talk to Korry because of
an important new development which has arisen concerning Chile.
Very briefly, Anaconda met separately with Secretary Connally
and John Irwin
2
during the past couple of days and proposed that the
U.S. send a special envoy to Chile to indicate that if the Chileans agree
to a fair settlement on compensation with the copper companies, the
U.S. will help to open up financial credits from the multilateral institu-
tions and New York banks as well as bilaterally. In essence, Anaconda
is proposing that we offer a deal to Allende which in effect would make
it possible for him to compensate the companies and obtain compensa-
tory financing from the international agencies. We have just received a
memo to the President from Secretary Connally indicating that he sup-
ports this idea (copy attached for your information).
3
We will staff the Connally memoand probably should take it up
in the SRG since it has significant implications for our overall political
strategybut I think it would be useful for you to talk with Korry and
get a perspective before he leaves. (I dont think Korry will bother you
about his personal future since that problem seems to have been taken
care of for the time being.) [I have just learned that you will be seeing
Anaconda representatives Tuesday;
4
since Korry probably stimulated
this idea, you should see him first.]
Recommendation
That you see Ambassador Korry today or tomorrow to discuss this
new problem.
5
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol V. Confidential. Sent for action. Sent through
Haig who initialed the memorandum.
2
A memorandum of conversation of the meeting between Irwin and John Place,
President of Anaconda, August 11, is ibid. It is Document 79 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973. No record of the ConnallyPlace
conversation has been found.
3
Document 244.
4
Tuesday, August 17. Brackets in the original.
5
A handwritten notation at the bottom of the page reads, Dr. Kissinger met with
Amb. Korry 5:30 p.m. 13 Aug 1971. No record of this conversation has been found.
378-376/428-S/80023
658 Foreign Relations, 19691976, Volume XXI
246. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, August 12, 1971.
SUBJECT
CIA Report on Chiles Emerging Economic Problems
Attached for your information at Tab A is a CIA Intelligence Mem-
orandum on Chiles Emerging Economic Problems.
2
The study dis-
cusses developing problems in the economic sphere and assesses their
implications on Allendes future. In brief the report notes that:
Thus far Allendes economic policies have been largely aimed at
building political support through reactivation of the economy and
massive redistribution of income.
Nationalization of industrial and commercial firms is destroying
investment incentives and disrupting production in many firms.
Export earnings have declined considerably from 1970 (due to
lower copper prices and production problems in the large copper
mines).
Traditional sources of foreign credit and investment are drying
up rapidly.
These factors plus heavy debt service payments and higher im-
ports have caused Chiles net international reserves to drop from $345
million to $200225 million during the first half of 1971.
In the short term prospects are good that:
Allende will be able to continue his politically expedient eco-
nomic policies.
The real economic growth rate in 1971 will probably exceed the
4% average of the past four years since the adverse effect of the agra-
rian reform measures on farm output will not be felt until the harvest in
early 1972 and short-term gains are expected in mining and manufac-
turing output as the result of recent additions to copper production ca-
pacity and the strong demand for consumer goods.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Secret. Sent for information.
2
Tab A, ERIM71138, July 1971, is attached but not printed. It concludes that in Al-
lendes efforts to build political support, Chile had suffered economically, especially re-
garding foreign reserves. The report concludes that Allende would be forced to take the
unpopular measure of restricting consumer demand, and the political implications could
be serious. The full text is Document 77 in Foreign Relations, 19691976, vol. E16, Docu-
ments on Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 659
Foreign reserves, however, will continue to drop (probably to
about $100 million by the end of 1971).
By early next year
Declining foreign reserves will probably force Allende to take
strong corrective actions in the economic sphere which will be politic-
ally unpopulare.g., restricting wage increases, raising taxes, curbing
credit expansion and reallocating resources from consumption to
investment.
Chile will probably be forced to curtail imports unless copper
prices rise dramatically or copper production problems are solved
quickly.
Food imports, however, will have to be increased to compensate
for the expected poor 1972 harvest due to disruption from agrarian re-
form and peasant takeovers.
The paper notes that Allende originally planned for a period of
reactivation of the economy which was to last until the Revolution be-
came irreversible, or until effective political opposition had been elim-
inated. This phase was projected to end in April of 1972. The rapid de-
pletion of Chiles reserves, however, may force earlier adoption of
corrective economic measures despite the political risks involved. In
fact, Allende has already decreed a substantial devaluation in the
brokers rate in an effort to stemthe drain on exchange reserves. The ac-
tion has stirred the opposition of the business sectors, which are seri-
ously affected by the measure and which are presently seeking to con-
vince Allende to modify the decree.
Should the economic situation deteriorate seriously, the CIA as-
sessment predicts Allende would probably seek aid from the Commu-
nist countries. However, the assistance which the USSR would prob-
ably be willing to provide is unlikely to be sufficient to meet Chiles
needs.
378-376/428-S/80023
660 Foreign Relations, 19691976, Volume XXI
247. Memorandum of Telephone Conversation
1
Washington, August 13, 1971, 5:15 p.m.
PARTICIPANTS
Orlando Letelier, Ambassador of the Republic of Chile
Arnold Nachmanoff, National Security Council Staff
SUBJECT
Boeing Loan
Mr. Nachmanoff said that Dr. Kissinger had asked him to call the
Ambassador about the matter which was discussed during the meeting
with him last week.
2
He said:
We regret that the Boeing matter has been brought to the atten-
tion of the press during this interval. Dr. Kissinger does want you to
know that he has taken another look at the Boeing loan case, as you re-
quested, and wishes to assure you again that there is no political con-
straint on the Export-Import Bank, and that the loan is being handled
essentially as a banking matter.
It is our understanding from the Bank that this issue is still open
and that no final decision has been taken. We understand that Kearns is
prepared to continue discussions with you and has indicated to you
those points which the Bank wishes to see further clarified by the
Chilean Government.
In view of the Banks position that the doors are still open, we
were surprised about the statements attributed by the press to you that
the Banks attitude constitutes an unfriendly actwe assume this was
not accurate, of course.
Dr. Kissinger wants to assure you of our desire to maintain good
relations with Chile, but he does not intend to intervene any further in
this individual loan case, because after looking at it, it is being handled
equitably by the Bank as essentially a banking or commercial matter.
[Note: The foregoing comments by Mr. Nachmanoff were inter-
rupted by unintelligible grunts.]
3
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Confidential. In an August 26 covering mem-
orandum to Kissinger, Nachmanoff wrote, the line I took was coordinated with State
and Ex-Im. (Ibid.) A stamped notation at the bottom of Nachmanoffs memorandum in-
dicates Kissinger saw it.
2
See Document 242.
3
Brackets in the original.
378-376/428-S/80023
November 5, 1970December 31, 1972 661
Ambassador Letelier: As you know, the door that Ex-Im Bank
that Mr. Kearnssays is still open is really a closed door because there
is a problem of timing, for it is absolutely impossible for the Chilean
Government to work against its constitution and be able to say today
how much money is involved for American companies. I think it is up
to us to present to the Ex-Im Bank an explanation of the procedure and
assure them of our willingness to cooperate to the extent that we can to
international law in accordance with the Chilean constitution. As a
matter of fact, only last week the companies presented to the office of
the Comptroller in Chile their figures and their claims, and this is a pro-
cedure that will take almost four months.
Then, the alternative that Mr. Kearns put in front of me that be-
fore considering the operation it was necessary to have a kind of clear
picture of this situation is impossible; no matter what our position is,
and how muchwe really dont know now. There is a fact that implies
postponement of one operation that makes it impossible to go ahead.
From that point of view, it puts us in a very difficult situation. There is
no way to give that nowI told Kearns what the situation is and what
could happen and said that it was impossible for the President to say
todaynobody can tell him now. What we did was to present a letter
about the situation on all the other elements. We explained our will-
ingness to act in a positive way for international law. The reaction of
Kearns was negative to go ahead in any other way. That is a very
candid way of saying no.
The Ambassador continued, saying I see Dr. Kissingers point
that this is not a political matter. In some ways it is not a banking
problem, but a financial problem and from that point of view I under-
stand quite clearly the message being passed to me.
Mr. Nachmanoff replied that he could not speak to the details of
what Mr. Kearns has asked, but of course I think you understand that
a factor in his consideration from a banking point of view undoubtedly
is to seek some clarification of some of the uncertainties and ambigu-
ities in the procedures for compensation, and he might like to see some
positive signs of progress in thingsfor example, Cerro. But this is
something that you and Kearns will have to discuss in further detail.
Our understanding is that he is prepared to talk further and to seek
some further clarification. From the Banks point of view, the matter
certainly isnt closed.
Ambassador Letelier said that he appreciated that information.
There is a problem that worries me. I gave all the information about
the Cerro situation. The President of Cerro is flying next week to Chile
to have a discussion with our President, and as far as I understand they
are making a press release today saying they have received from Chile
very satisfactory treatment. They are making that kind of statement. On
378-376/428-S/80023
662 Foreign Relations, 19691976, Volume XXI
Kennecott and Anaconda, they presented their papers to the Comp-
troller only last weekThursday or Friday. Things are working. It
doesnt matter which party is in in Chilewhat is really happening I
think is clear. The situation is this then: we are in the middle of the pro-
cedure and a kind of flux. I am pleased to know that the door is open.
Mr. Nachmanoff said that As Dr. Kissinger mentioned in the
meeting, we recognize the timing problem, but it works two ways. I am
sure the Bank also has a problem too in the sense of needing some fur-
ther sound information.
Ambassador Letelier interrupted to say that it was impossible to
give Mr. Kearns what he said he needed in time in order to have his
own opinion of the picture. It wasnt very clear what he wanted. He
told me this thing of the copper companies was a financial matter. If in
some way it would be possible to get some kind of indication in a more
clear way of what Ex-Im needs to know, what would be a factor ele-
ment for the Ex-Im Bank, I would be glad to work on them and try to
produce them. But really when I asked Kearns to tell me what exactly
he wants, he didnt tell me anything clear.
Mr. Nachmanoff said that maybe this can be discussed further
and worked out between you and the Bank. Lets hope so.
Ambassador Letelier said that in order to clarify what should be a
factor element for the Bank, we would be very interested to try to go
back. I think, too, that it will be necessary to have some thinking of the
problem.
Mr. Nachmanoff replied that this is something that the Bank itself
must decide, and that these are the details which Dr. Kissinger said we
cannot go into.
Ambassador Letelier stressed that the reason for talking with Dr.
Kissinger was not the loan itself, but to look into the discussion which
could have some sort of political implication.
Mr. Nachmanoff ended the call by saying that he would tell Dr.
Kissinger of this conversation.
378-376/428-S/80023
November 5, 1970December 31, 1972 663
248. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, August 14, 1971.
SUBJECT
Your meeting with Anaconda officials Tuesday, August 1712 noon
You are scheduled to meet on Tuesday at noon with John Place, the
new President of Anaconda, and William Quigley, Vice Chairman of
the Board.
2
They met last week separately with Secretary Connally and
Under Secretary Irwin, and also visited Mr. McNamara of the IBRD
and Mr. Ortiz Mena, President of the IDB.
The basic thrust of the Anaconda presentation will probably be to
suggest that the U.S. send a special envoy to Chile to propose a deal. In effect,
the envoy would warn the Chileans that if they do not settle on fair
compensation arrangements with the copper companies, we will as-
sure that the GOC is cut off from international credits, but if they agree
to fair settlements, the U.S. Government will actively support the
opening up of international credits for Chile. They will argue that we
need to move quickly on this because Korry is a lame duck, time is run-
ning out on the Chilean procedures for establishing compensation, and
extreme leftist influence in the GOC is increasing. They will probably
allude to the fact that Chile will need about $300 million in working
capital for expansion of the copper industry, and suggest that the IBRD,
IDB, and Ex-Im might provide such capital directly or indirectly if fair
settlements are achieved.
I am attaching for your background information a draft memcon of
Irwins meeting with Place and Quigley (it is a bootleg; protect my
source). I am also attaching at Tab B a copy of a memo from Secretary
Connally which in effect endorses the Anaconda proposal.
3
State will
probably endorse something like this too, though it is more reluctant
about designating a special envoy and probably would prefer to use a
third party, like McNamara.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Confidential. Sent for action.
2
According to Kissingers Record of Schedule, he and Nachmanoff met with Place
and Quigley on August 17 at 12:25 p.m. until approximately 1 p.m. (Library of Congress,
Manuscript Division, Kissinger Papers, Box 438, Miscellaneous, Record of Schedule)
Kissinger reported to the President on his meeting in Document 253.
3
Tab A is printed in Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973, Document 79. Tab B is Document 244.
378-376/428-S/80023
664 Foreign Relations, 19691976, Volume XXI
I suggest that you listen to the Anaconda representatives, and:
Express your interest in the proposal.
Ask for their assessment of Allendes intentions and his ability
to carry out a deal of this kind.
Indicate that we will give serious consideration to the proposal,
but avoid any commitment.
Note that Ambassador Korry has just returned to Chile and will
be taking some soundings. [FYI: Korry has a letter from Secretary
Rogers affirming that he has the full confidence of the President and the
USG during the remainder of his tenure.]
4
Although the Anaconda proposal might make sense from the
point of view of trying to attain fair compensation and avoid confronta-
tion on this issue, the key question we must face is the impact of such a
deal on Allendes economic and political situation, and its effect on our
overall political strategy. There are also a number of questions that must be
decided before we try to implement such a schemee.g., Is it appro-
priate for the U.S. taxpayer to directly or indirectly subsidize compen-
sation for the companies? What would constitute a satisfactory settle-
ment? What kinds and how much international credit would we be
prepared to see released as part of such a deal? Who would make the
approach?
This is an issue which probably should be taken up in the SRG at
an early date.
4
Undated memorandum from Rogers to Korry. (National Archives, Nixon Presi-
dential Materials, NSC Files, Box 775, Country Files, Latin America, Chile, Vol. V) See
also Document 249. Brackets are in the original.
378-376/428-S/80023
November 5, 1970December 31, 1972 665
249. Letter From Secretary of State Rogers to Chilean Minister of
Foreign Affairs Almeyda
1
Washington, August 16, 1971.
Dear Mr. Minister:
Knowing that Ambassador Korry would be calling on you to
present a communication pertaining to the treatment of U.S. com-
panies, I have asked him to carry this personal message from me.
As I said to you in our first and, for me, valuable conversation in
San Jose, good relations between our two countries can and should be
maintained.
2
This common aim depends, of course, on a mutual effort
to be, as you have often told Ambassador Korry, pragmatic rather than
doctrinaire in the resolution of differences that might arise between our
governments. Its attainment requires frank, genuine and close commu-
nication between us.
In the next weeks and months, decisions will be taken that can
have significant effect on our relations. It seems to me essential that in
this period our two governments should sustain a dialogue that will
serve to avoid misunderstandings and to clarify areas of useful explo-
ration. For this reason I have asked Ambassador Korry, pending the ar-
rival of Ambassador Davis, to maintain close communication with the
Government of Chile.
It is in that spirit that I want you to know that when Ambassador
Korry speaks in the name of the United States Government, he does so
with the complete authority and confidence of President Nixon and
me.
In the case of the legislation nationalizing U.S. copper investments
in Chile, we have noted the significant areas of discretion clearly re-
served to President Allende and the Government of Chile and other
areas of potential flexibility in establishing a valuation. The manner of
implementation of the pertinent Chilean legislation will in large meas-
ure be determined by its sponsors, your government. I would hope that
it would use its legal power and moral authority to promote an applica-
tion of the law that would help to maintain the good relations between
our countries.
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. No clas-
sification marking.
2
Reported in an April 16 memorandum of conversation; see Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973, Document 61.
378-376/428-S/80023
666 Foreign Relations, 19691976, Volume XXI
I am confident that talks between your government and the af-
fected U.S. companies could advance that important objective.
Sincerely yours,
William P. Rogers
250. Telegram From the Department of State to the Embassy in
Chile
1
Washington, August 18, 1971, 1448Z.
152097. Subject: Chile Copper Negotiations.
1. Now that Chile copper bill has become law, we believe USG
should reiterate its position in writing.
2
Accordingly, you are requested
to seek appointment with Foreign Minister to present the first person
note set forth below. Main purposes of this representation are to dem-
onstrate seriousness we attach to points heretofore made orally to GOC
officials on many occasions and at all levels; to avoid any miscalcula-
tion on part of GOC of possible consequences of their actions toward
US investors; and to lay basis for future US position in event problem
cannot be resolved. In preparing this text, however, we have been
mindful that any US note may require a Chilean reply and that we do
not wish to precipitate a response that would jeopardize or make much
more difficult achievement of our objective of encouraging fair settle-
ments negotiated directly by GOC and companies. Thus, we have set
forth our legal case against the amendment in general terms only,
without dwelling at length on specific arguments.
2. When you present this note, you should expand upon points
made in text, drawing upon previous guidance as appropriate, and em-
phasizing following:
(1) US position continues to be that we are prepared to have the re-
lations with Chile that it is prepared to have with us. Our natural pref-
erence is that these relations would be mutually positive and construc-
tive. At same time these relations, as with any nation in Hemisphere,
will depend not on internal structures or social systems but on actions
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Con-
fidential; Immediate. Drafted by Feldman, Morgan, and Fisher; cleared by Samuels,
Miller, Salans (L), Weintraub (E), and Hunt (OPIC); and approved by Meyer.
2
See footnote 2, Document 239.
378-376/428-S/80023
November 5, 1970December 31, 1972 667
which affect our interests and the inter-American system. In this re-
spect we consider it essential that every effort be made on both sides to
eliminate to extent we can any possibility of misunderstanding or
miscalculation.
(2) Among the interests to which US attaches importance is fair
treatment of US investors abroad. We do not question Chiles right to
structure its economy in any way it sees fit, but we do expect that US
investors will be treated fairly and without discrimination as required
by international law. (At this point you could once again mention spe-
cial inclusion of Andina
3
in the bill and ask when deal with Cerro will
be signed, recalling unfulfilled high-level assurances on this matter.)
(3) US has number of serious problems with copper bill as enacted.
In particular, we are concerned that book value is not a fair measure of
compensation to which companies are entitled under international law.
In these cases fair market value of assets alonewholly apart from
going-concern value of enterprisesis probably much greater than his-
toric book value. We hope GOC can find sufficient flexibility in the law
to do full justice. Needless to say, the companies and USG would look
upon any significant deductions from book value (whether by way of
deductions in asset values, assertion of unfounded liabilities, or a deter-
mination of excess profits) as punitive and confiscatory. Moreover,
failure of GOC to honor debts of former operating companies, or notes
already issued by GOC with respect to purchase of equity interests in
those companies, would be viewed in the same light.
(4) To mention these facts is not to imply that US desires anything
but normal relations with Chile. If fair settlements are not made, USG
would of course maintain its position in accordance with international
law and its own legislative requirements. We are encouraged by settle-
ments that have been negotiated to date (apart from delay in finalizing
Cerro agreement), and we have also taken careful note of assurances of
fair treatment that have been given by President Allende. If major
copper cases can be settled on a mutually satisfactory basis by negotia-
tion between GOC and companies, there would be no reason for those
cases to become a question between our two governments.
(5) We are aware that GOC has agreed to enter into discussions
with both Kennecott and Anaconda. The companies have indicated
they are prepared to begin at once. We hope GOC will take steps to get
talks underway as soon as possible. The companies will be cooperating
with Contraloria in its work, but it would seem prudent, if a satisfac-
tory solution is to be achieved, that there be full and continuing ex-
change of views between companies and GOC before work of Contra-
3
Cerros mine Andina had just been opened in 19701971, and provided about 9
percent of the total output of Chilean copper. (Davis, Last Two Years, p. 101)
378-376/428-S/80023
668 Foreign Relations, 19691976, Volume XXI
loria advances much further. If Foreign Minister should allude to
independence of Contraloria, you should acknowledge that tradition.
However, you should note role of CODELCO
4
in presenting objections
to assets of companies and you should express concern that atmo-
sphere in which these processes unfold not be influenced by propa-
ganda attacks upon companies which put in question GOCs intent to
provide just compensation. Further, there are issues of considerable im-
portance not within the jurisdiction of Contraloria that should be dis-
cussed by companies and GOC at an early date (i.e. special deductions,
terms of compensation, etc.)
3. Text of note is as follows: Quote.
Excellency:
I have the honor to refer to Law 17,450 of July 16, 1971, amending
the Constitution of the Republic of Chile so as to nationalize those com-
panies which constitute the Major Copper Mining Industry as desig-
nated by law and, in addition, the Compania Minera Andina, and to
Decrees 69, 70, 71, 72, and 73 of July 17, 1971, pursuant to which the
Government of Chile has taken possession and control of the assets and
management of these companies. The effect of these provisions is to ex-
propriate the interests of certain United States investors in the Chilean
copper industry. Interests of investors from other foreign countries are
not affected.
The Government of the United States of America recognizes the
right of every sovereign state to expropriate foreign-owned private
property within its territory for a public purpose, provided such taking
is not discriminatory and that reasonable provision is made for the pay-
ment of just compensation as required by established principles of
international law. Such compensation, of course, should be paid
promptly, in an amount that is adequate, and in a form effectively real-
izable by the investor.
Law 17,450 contemplates that some compensation may be paid for
the interests affected, but the amount of that compensation, and the
terms on which it would be payable, are uncertain. The nationalization
law also appears to suspend the judicial review normally available in
Chile and establishes a special tribunal composed of government offi-
cials as well as of judges.
My Government is constrained to note that several aspects of the
nationalization law give rise to serious concern. Among these are the
following: The law establishes a restrictive basis of valuation that may
4
CODELCO (Corporacion del Cobre) gained full ownership of the expropriated
properties of some of the foreign mining companies in Chile. It prodded the Government
of Chile to expropriate more mines.
378-376/428-S/80023
November 5, 1970December 31, 1972 669
not represent the fair value of the interests nationalized. It permits a de-
duction to be fixed by the President of Chile based on alleged excess
profits since 1955. My Government notes in this regard that the profits
of the copper companies were earned in accordance with Chilean law
and specific agreements of the Government of Chile. The Government
of Chile approved the making and the manner of these investments,
and as to significant portions thereof, that approval was certified to my
Government by official communication. The law, moreover, abrogates
without assurance of compensation agreements solemnly concluded in
recent years between the U.S. investors and the Government of Chile.
On the other hand, my Government understands that to the extent
that the Contraloria lacks flexibility in the execution of the law, the final
result can be significantly ameliorated by actions within the discretion
of the President of Chile. The exercise of such discretion could avoid
the application of deductions which would further reduce the compen-
sation permitted under the restrictive evaluation provisions of the law.
My Government has noted the public statements of President Allende
that the Government of Chile will honor the debts of the companies
that have been nationalized and will deal with the investors on the
basis of justice and equity. My Government also welcomes the agree-
ments that have been reached with certain other U.S. investors. It is
concerned, however, that the agreement negotiated some months ago
by authorized representatives of the Government of Chile with the
Cerro Corporation has not been signed on behalf of the Government of
Chile despite repeated assurances that have been given on this point. It
is disquieted by lack of implementation of repeated assurances that dis-
cussions would be held with representatives of the Anaconda Com-
pany and Kennecott Copper Corporation.
My Government is convinced that this problem, and similar
problems arising out of the expropriation of other United States in-
terests, can still be resolved amicably if the nationalization law is inter-
preted and implemented in a spirit of justice.
My Government earnestly hopes that the Government of Chile
will pursue this course.
I can assure Your Excellency that the good offices of this Embassy
continue to be available for whatever assistance they may serve in
furthering settlements of these cases that will help maintain the good
relations that exist between the United States of America and the Re-
public of Chile. Unquote.
Rogers
378-376/428-S/80023
670 Foreign Relations, 19691976, Volume XXI
251. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, August 20, 1971, 2110Z.
4359. Pass OPIC. Subject: Presentation of Secretarys Letter and
Note to FonMin. Ref: State 152097.
2
1. Summary: Presented Secretarys letter to Almeyda Aug 19.
3
Ex-
plained note outlining US position on nationalization would follow
later that day.
4
Set forth US position. When Almeyda said Exim inter-
vention was very serious incident that had done grave damage to
our relations,
5
I asked why then GOC had deliberately provoked it. In
ensuing discussion, I stressed USG will not be hot-aired into aban-
doning its interests but that it was fully prepared to reciprocate prag-
matism. FonMin suggested I continue dialogue with MinInterior Toha
who will be Acting President (VP) in Allendes absence next week. End
summary.
2. Almeyda, in company of head of North American office, Sra.
Wiegold, asked if I had had a pleasant and interesting stay in Wash-
ington, thus revealing a total ignorance of motive for my recent travel
to New York. He appeared genuinely surprised and embarrassed by
his informational gap to which I referred later in conversation that
lasted almost one hour.
3. I explained I had asked for appointment immediately upon re-
turning because he and Allende would be absent for most of next fort-
night beginning Aug 23 and because he currently much occupied as
host to foreign visitors (Cuban FonMin). My main purpose was to hand
over a personal letter from the Secretary which I suggested should be
read in conjunction with an official note concerning copper nationaliza-
tion that would be delivered to him within a few hours (not having ar-
rived in Santiago in time for the appointment). In response to his ques-
tion, I encouraged him to read the Secretarys message straight away
(we had prepared a translation). Almeyda read it carefully, requested I
transmit his appreciation but abstained from any substantive comment.
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Con-
fidential; Priority.
2
Document 250.
3
Document 249.
4
The note transmitted in Document 250.
5
On August 11, the Export-Import Bank rejected the Chilean request for loans to
purchase three planes for LAN-Chile. (Benjamin Welles, U.S. Export Bank Refuses Chile
Loan To Buy 3 Airliners, New York Times, August 12, 1971, p. 1) See Document 238.
378-376/428-S/80023
November 5, 1970December 31, 1972 671
4. Stating that it might be opportune to review briefly our relations,
I recalled our first conversation in that same office last November, a
few days after Allendes inauguration. The main point I had sought to
make then was that the US was prepared to be realistic in dealing with
new realities but that we could not rpt not go so far as to provide the
new Allende administration with an accommodating revolution in the
US. Subsequently, the Minister had responded by stating his gov-
ernments readiness to be pragmatic rather than doctrinaire. By mutual
effort we had achieved a good deal in the circumstances and I remained
convinced that we could resolve all the major nationalization-
compensation problems in an acceptable manner. He interrupted to say
with great difficulty. I rejoined that it would require an effort to
avoid visceral thinking that produced a desire to impose solutions for
the sake of imposition even if it were rationalized in the name of doc-
trine. I reminded Almeyda that he had described himself to me as a
Maoist. I suggested he read the text of Cho En Lais interview with
Reston
6
to understand that ideology had to be reconciled with interest
and that, as Almeyda had said to me months ago, tactics and strategies
had to be considered separately.
5. I began to review the talking points accompanying the note
(reftel) and had covered the first two when Almeyda interrupted to as-
sert that the first blow to the good relations we had established had
come last month with the Haldeman incident. When I sought to
brush it aside as having no importance and that indeed it had quickly
faded into oblivion, he took excited exception. If the earthquake had
not occurred the same day, he said, it would be very much alike. He
had explained it all to the DCM in my absence from the city that day
(July 8). I chose to remain silent because of my total incapacity to this
date to understand Almeydas and the GOCs reaction to Haldemans
bland teletype message (Santiago 3644),
7
even when Almeyda insinu-
ated that there had been some kind of official provocation involved in
the Kennecott executives actions. However, when he went on to assert
that ExIm intervention in Chilean affairs had been a very serious inci-
dent and again implied that we had deliberately sought to provoke an
unfriendly atmosphere. I interrupted to ask if he really considered the
6
New York Times journalist James Reston interviewed Zhou Enlai in Beijing on Au-
gust 9.
7
Robert Haldeman was Kennecotts representative at the El Teniente mine. Tele-
gram 3644 from Santiago, July 7, reported on a conversation with Almeyda who referred
to Haldemans now notorious telex allegedly slandering the Chilean Government. In
the message, Haldeman stated that Chilean officials threatened to upset the modus vi-
vendi that had so far maintained a favorable atmosphere for pragmatically solving
United States-Chilean problems. According to Almeyda, Haldeman was the last North
American manager left at any mine in Chile, making the situation more serious. (Na-
tional Archives, RG 59, Central Files 197073, INCOCOPPER CHILE)
378-376/428-S/80023
672 Foreign Relations, 19691976, Volume XXI
publicity given the ExIm in the past week truly a serious episode. He
replied affirmatively with great vigor. Why then did the GOC deliber-
ately provoke it? I asked.
6. Almeyda was so taken aback, he remained speechless a full
minute. Finally, he asked what I meant. I reviewed my conversations
with Letelier here and in Washington and those with Toha, Matus,
Cantuarias and even the President. In all these talks since May, I had
left no doubt in anyones mind that the refusal to sign an agreement
negotiated in good faith by Allendes personal reps with Cerro with
friendly support to both parties by my Embassy would have impact on
all US agencies including the ExIm. I recalled that in July in Wash-
ington Letelier had proposed to me a simultaneous signing of both
Cerro and the LAN Chile ExIm loan, thus revealing his full under-
standing of the aforementioned impact. I had told Letelier I had been
willing to support a recommendation for an ExIm loan but that the in-
capacity of the GOC on three occasions to fulfill its own pledges was
not the kind of performance to inspire confidence in a banker.
7. Almeyda cut in to ask if I had seen Cerros statement (see San-
tiago 4354).
8
I said I had not but that I could not be impressed by the ut-
terances of a hostage. We had our own record with Cerro. I hoped we
would not be forced to make it public. Almeyda said everyone recog-
nized Cerro would be fairly treated.
9
I replied that I had so heard from
many months and still hoped an acceptable agreement would be
signed one day. But we had an obligation to seek fair and non-
discriminatory treatment for all our citizens.
8. Almeyda then asserted that all Chile was persuaded that the
ExImBank was seeking to interfere inadmissably in Chilean internal af-
fairs. I asked permission to resume my summary and recalled that de-
spite the understanding of key figures at the top of the GOC Govt as to
the impact of the failure to sign the Cerro loan and despite Leteliers
specific comprehension in July that therefore it was not the appropriate
or propitious time to pursue the signing of the LAN Chile loan, he had
pressed the matter. Moreover, having done so, he had leaked the sub-
stance of his conversation with Kearns as recounted to the State Dept.
by three separate reporters. How could anyone conclude other than
that the GOC was seeking to create an artificial atmosphere, that it was
trying to do harm to the Nixon administration, that it was calculating
that it could gain public sympathy by this kind of tactic. Similar tactics
8
Dated August 20. (Ibid.)
9
In telegram4368 from Santiago, August 20, Korry stated that he told Almeyda that
one of the welsh[es] on Cerro deal happened at the same time as the Allende gov-
ernment inaccurately blamed the Central Intelligence Agency for the murder of Perez
Zujovic. Korry stated that Chile had never officially disclaimed the anti-CIA campaign as
promised; in fact, it intensified [it] thereafter. (Ibid., INCO 152 CHILE)
378-376/428-S/80023
November 5, 1970December 31, 1972 673
had fomented a poor atmosphere between my Embassy and his prede-
cessor; if serious exchanges were to be immediately divulged in a ten-
dentious manner, there was no chance of a geniune dialogue. I was not
disputing the right to take a case to the public or to seek to influence
public opinion, but it was quite another matter for a govt to maneuver
deliberately to embarrass a friendly govt in its own capital. I had never
spoken to a member of the Chilean media since the election of Allende
because I had based my actions on the hopes of a mature dialogue with
him and his colleagues.
9. Almeyda asserted again that there was universal support in
Chile for the official view of the ExIm action. Had I seen the statements
of the opposition parties, he asked. I told him I had once worked on
Madison Avenue and that Marxists had contributed a considerable
body of literature (he smiled) on what it takes to motivate people.
Therefore I confessed to being unimpressed by such orchestration of
peoples emotions.
10. As a respectful friend in the process of terminating my mission,
I wanted him to know my conviction that the Nixon administration
would not be swayed in the least by such tactics. I was 100 percent cer-
tain of that. If the Allende administration sought for internal or external
reasons to whip up emotion against the US over the ExIm matter, it was
consonant with an increasingly discriminatory line by the parties of the
govt. The inclusion of Cerro in the copper bill had been very discrimi-
natory; the manner in which CODELCO, an agency of the govt, was
seeking to diminish the values of the assets of Anaconda and Kennecott
to absolute zero by the strangest of calculations was discriminatory; so
too, was the pressure being applied against Chilean University stu-
dents not to travel to the US to study in the social sciences; so too were
the subtle pressures used to bar most US cultural performers such as
the Utah Symphony or our opera singers; so, too, was the absolution
given European companies in competitive fields with US firms. Even
his lack of knowledge about the purpose of my recent journey was the
result of discrimination; to place a US Ambassador or Embassy in any-
thing approaching a sympathetic light was becoming more intolerable
or dangerous.
11. Almeyda countered that my statement that the USG would not
be moved by the Chilean publics reaction signified that we would be
acting viscerally. I said we had acted and would act coolly to defend
our interests. My advice to his govt was to seek to do its sums equally
coolly. It was no secret to anyone that Chiles reserves were declining,
that its food supply was diminishing, that its import of machinery was
being held to the barest minimum. None of this was the result of US
meddling in any way. We had in fact assisted those firms that wished
remain in or come to Chile as he well knew. We had not interfered in
378-376/428-S/80023
674 Foreign Relations, 19691976, Volume XXI
the GOCs negotiations of fresh credits with US banks nor had we
sought to dissuade anyone from doing business with Chile. Chileans
alone were determining Chiles future.
12. I considered it entirely feasible for Chile to have its economic
nationalism, to go on its way to socialism and yet avoid becoming an
outcast of the international banking community. There were ways to
arrive at settlements with ITT, Anaconda and Kennecott that would not
injure socialist principles and that would provide for solutions accept-
able to each company. I had thought about the specifics a great deal.
There were, to quote the Secretary, areas of useful exploration. Did the
GOC wish to search jointly to identify them or did it prefer to impose
solutions unilaterally or to bet on undermining Washingtons position?
I strongly recommended the mathematical view. The other options sig-
nified a rocky road for Chile and Chileans in which a bleak material life
would be one certain outcome.
12. Almeyda who had chain-smoked five cigarettes in 25 minutes
would not dare a response beyond saying he would inform the Presi-
dent fully and immediately. I asked if he thought it would be useful to
talk to someone during his and the Presidents 10-day trip abroad. He
said Toha would be Vice President. When I said Toha would be very
busy, Almeyda replied not too busy for a matter of such importance.
13. A few hours later EmbOff delivered to Sra Wiegold accompa-
nied by Carlos Mardones, Sub-Director of Political Dept, the note. They
took copious notes, without comment, on oral points contained in
instructions.
Korry
252. Telegram From the Department of State to the Embassy in
Chile
1
Washington, August 21, 1971, 1924Z.
153950. For Ambassador from Asst Secretary Meyer. Subj: Presen-
tation of Secretarys Letter and Note to Foreign Minister. Ref: Santiago
4359.
2
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Con-
fidential; Priority; Exdis. Drafted by Meyer and Fisher; cleared by Girdler and Miller; and
approved by Meyer.
2
Document 251.
378-376/428-S/80023
November 5, 1970December 31, 1972 675
1. Letelier in call on me August 20 showed what I took to be gen-
uine nervousness over signs of decay in his own standing at home con-
current with recent downturn in US-Chilean relations. He mentioned
his concern over recent criticisms of him printed in Ultima Hora.
2. He professed to agree completely with me that it is unhelpful
to both our governments to have our relations conducted via the
newspapers.
3. Letelier claimed to have made a positive effort to deflate press
polemics in his handling of his own press backgrounder lunch on Au-
gust 18. (Accounts of it which we have received from newsmen present
confirm that it was relatively low-key and non-provocative.)
4. Letelier repeatedly emphasized the importance which GOC at-
taches to Boeing loan decision as a factor in our relations and as an in-
fluence on GOCs approach to other specific problems between us.
5. Following your clear and effective presentation to Almeyda on
August 20 of USG points of view, I believe that the moment has arrived
for a tactical change of pace on our part.
6. My thought is that, having made our points so effectively, we
can now move toward a thoughtful and deliberate atmosphere for con-
sideration of copper questions in particular which are involved in
US-Chile relations in general. First and most important immediate goal
is to slow the Chileans headlong rush toward hard conclusions on
copper. A stretch-out in the time schedule and concomitant reduction
in the level of Chilean emotion could also provide a more conducive at-
mosphere for mutual exploration of prospects for pragmatic solutions.
7. While Toha is in charge do you anticipate a standstill?
8. I look forward to the current sitrep and your comments.
3
Johnson
3
In telegram 4499 from Santiago, August 30, the Embassy provided a situation re-
port on the Chilean negotiations with U.S. copper companies and ITT. (National Ar-
chives, RG 59, Central Files 197073, INCO 152 CHILE)
378-376/428-S/80023
676 Foreign Relations, 19691976, Volume XXI
253. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, August 24, 1971.
SUBJECT
Designation of a Special Presidential Envoy Regarding Expropriations in Chile
In the memo at Tab A
2
Secretary Connally suggests that you send a
special envoy to President Allende of Chile to communicate that it is
our objective to be helpful to Chile if they are reasonable in providing
compensation to the US copper companies, but to deny them access
to international credit facilities if they are unreasonable on copper
compensation.
This suggestion, which was stimulated by Anaconda (who also
made a presentation to me),
3
in effect proposes a deal to the Chilean
Government under which we would indirectly compensate Chile if it
compensates the copper companies. The idea is to give Allende an in-
centive and rationale for resisting pressure from extreme leftist ele-
ments who do not want to pay any compensation.
One reason for the recommendation for urgent action was Ambas-
sador Korrys absence from Chile last week (due to the death of his fa-
ther). However, Korry has returned to Santiago, and we have author-
ized him to take some soundings on the Anaconda proposal, but
without making any commitments.
4
We expect to receive specific rec-
ommendations from Korry shortly which we will then consider within
the context of our overall political strategy toward Chile.
As I told the Anaconda representatives, we have a strong interest
and determination to help them obtain compensation, and we will take
a tough line on this; however, we have broader political interests as
well, and we will want to assess the proposal in terms of its impact on
Allendes economic and political situation. Opening up international
credits for Chile to obtain compensation for the copper companies may
also help Allende to escape from an economic crunch which he is likely
to face early next year. One of the objectives of our policy toward Chile
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Secret. Sent for action. A stamped notation
on the memorandum indicates the President saw it.
2
Tab A, an August 10 memorandum from Connally to Nixon, is printed as Docu-
ment 244.
3
See Document 248.
4
Reference is presumably to telegram 158502, dated August 27. (National Archives,
RG 59, Central Files 197073, INCO 152 CHILE) See also Document 254.
378-376/428-S/80023
November 5, 1970December 31, 1972 677
has been to maximize Allendes economic difficulties as soon as pos-
sible, before he can consolidate his strength and destroy whatever po-
tential still exists for the political opposition to rally against him. There-
fore, we need to consider whether the Anaconda proposal might be
more advantageous to Allendes interests rather than our own.
I intend to review this problem very shortly in the NSC Senior Re-
view Group
5
(to which you assigned responsibility for overseeing our
Chile policy) to consider the impact of this proposal on both the
chances for compensation and our broader political strategy. Until
then, I suggest you take no action on this suggestion.
Recommendation
That you authorize me to inform Secretary Connally that before
reaching a decision on his suggestion, you wish to have it considered
by the NSC Senior Review Group in the context of our overall strategy
toward Chile.
6
5
See Document 257.
6
The President initialed the Approve option.
254. Telegram From the Department of State to the Embassy in
Chile
1
Washington, August 31, 1971, [illegible].
160005. For Ambassador from Meyer. Subject: Copper. Ref: (A)
State 158502;
2
(B) Santiago 4499.
3
1. I confirm that our purpose remains same as before: To work
pragmatically and non-polemically toward solutions. Idea behind
presentation suggested ref (A) was to provide time to work out such so-
lution, giving companies time to be heard. As you know, Anacondas
proposal was to gain time for possibility of carrot to begin to become
visible to GOC as well as stick. USG position on this aspect will be de-
termined by its independent calculation of needs of US interest, but it
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Se-
cret; Immediate; Exdis. Drafted by Feldman and Fisher; cleared by Mays (OPIC) and
Miller; and approved by Meyer.
2
Dated August 27. (Ibid.)
3
Dated August 30. (Ibid.)
378-376/428-S/80023
678 Foreign Relations, 19691976, Volume XXI
seems to us important to insure that GOC has clear understanding of
implications of imposing excess profit deductions, which we could
only regard as punitive. We will be following up on this in Washington
and you should do likewise.
2. Naturally we would welcome settlement of ITT case. That
would be tour de force in view rigid GOC position and companys
seeming disinterest in settlement unless it adds substantially to OPIC
insurance. Would appreciate further elucidation of your point para 4
ref (B) that model of an accord with ITT could be applied to Anaconda
and Kennecott.
3. Any further ideas you have on present US options (both carrot
and stick) would be most pertinent to Washington review to take place
early next week. Assuming, as you seem to suggest, that Contralor re-
quest for excess profits determination does not make question of
stretch-out academic, we would also appreciate your further analysis
of risks and advantages of seeking more time on alternative hypothesis
of US response to indications that GOC could be motivated to provide
adequate compensation. Considering paras 2(c) and 9 of ref (B),
4
we
would appreciate your views as to how the leverage of credit squeeze,
and GOC interest in debt rescheduling, can be utilized to promote US
interest.
Johnson
4
Paragraph 2c of telegram 4499 from Santiago reads, I have never been impressed
by Anacondas arguments for more time. They presuppose Allendes willingness to
listen to Anacondas experts or lawyers. Alternatively, they rest on a calculation that the
more time, the more bite in the credit squeeze and, therefore, the more conciliatory an at-
titude. Neither is remotely correct. Paragraph 9 reads, US businessmen are as one in
applauding both the credit squeeze on Chile and the pressure against the discriminatory
aspects of the GOC politics toward the U.S.
378-376/428-S/80023
November 5, 1970December 31, 1972 679
255. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, September 8, 1971.
SUBJECT
40 Committee Meeting, September 9, 1971CHILE [less than 1 line not declassified]
The 40 Committee meeting is scheduled to consider a request [less
than 1 line not declassified] of El Mercurio (the largest independent news-
paper in Chile) for covert support totalling $1 million.
2
[1 line not declas-
sified] and will be prepared to brief on this subject if you wish to take it
up after the Chile discussion. If not, this can be covered at the next 40
Committee meeting, scheduled for September 15.
Chile
The CIA paper on the El Mercurio proposal (tabbed) reports on the
increasing pressure which the Allende government is bringing to bear
against El Mercurio. The economic squeeze on the newspaper is made
possible by the increasing governmental control over finance and
business in Chile. [less than 1 line not declassified] the paper needs at least
$1 million to survive for the next year or two. The pressure for an im-
mediate decision comes from the fact that an opportunity has pre-
sented [8 lines not declassified].
The basic options posed in the CIA paper are:
A. To provide extensive financing for the newspaper with the under-
standing that this may not be sufficient to stop the Allende government
from closing the paper anyway (e.g., through control of newsprint, or
labor stoppages). This would involve an initial commitment of at least
$700,000.
B. Allow El Mercurio to go out of business and arrange a maximum
propaganda effort on the issue of freedom of the press. Allende might
be able to counter that by demonstrating that it was El Mercurios finan-
cial ineptitude which resulted in its closing.
Ambassador Korry and the Station Chief recommend the first option.
Their position is that we have a great interest in maintaining an opposi-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Secret; Sensitive; Eyes Only; Outside System.
Sent for action.
2
The memorandum for the 40 Committee, September 8, is Document 82 in Foreign
Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
680 Foreign Relations, 19691976, Volume XXI
tion voice in Chile and that without it, the political opposition would be
seriously weakened. Allendes intense efforts to destroy El Mercurio in-
dicate that he probably regards it as a significant barrier to his internal
political strategy. On the negative side, however, $1 million would be a
very expensive price to pay for a little extra time if we conclude that Al-
lende intends and has the capability to close down the newspaper
anyway.
Option B would obviously be less costly and might force Allende to
a confrontation on the press freedom issue before he really is prepared.
If the issue can be exploited in and out of Chile to a sufficient degree,
there may be considerable advantage in creating a diversionery issue be-
fore Allende can solidify his support for a confrontation on the copper
compensation question.
My judgment is that we should probably take both options and link them.
I believe we should go ahead with the $700,000 deal, understanding full
well that: (a) this may buy only a very limited amount of time for El
Mercurio, and (b) that we are not making a commitment to continue to
bail out El Mercurio in the future. Moreover, we should condition our sup-
port on an understanding that El Mercurio will launch an intensive public at-
tack on the Allende governments efforts to force them out of businesse.g.,
public editorials, letters to the Inter-American Press Association and
leading newspapers, requests for moral and financial support from the
free press, spelling out of some of the blackmail tactics which the Al-
lende government has been using. The U.S. Government, of course,
should not get into a public shouting match on this issue, but we can re-
play and support El Mercurios crusade for press freedom behind the
scenes. (It should be possible to induce some of the larger newspapers
in this country and elsewhere to take a strong editorial stand against
Allende dictatorial tactics in seeking to force the closure of a major in-
dependent newspaper.) It seems to me that this course would keep the op-
position voice alive for awhile and force Allende either to back down or risk in-
tensive criticism on the press freedom issue. If he chooses the latter course,
it should be helpful to us in diverting and perhaps even undercutting
some of his support on the copper compensation which will probably
reach a climax in the next couple of months.
Your Talking Points pursue this line of reasoning.
3
[Omitted here is material unrelated to Chile.]
3
Attached but not printed.
378-376/428-S/80023
November 5, 1970December 31, 1972 681
256. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, September 8, 1971.
SUBJECT
SRG Meeting September 9, 1971Chile
The issue to be considered at the SRG September 9 is whether to
take a positive initiative with the Chilean Government to induce it to
provide acceptable compensation to the copper companies. In essence
this would be some version of the Anaconda proposalendorsed by
Connallyfor a special emissary who would hold out the carrot of fu-
ture international credits if the GOC compensates the companies. The
paper prepared by the Ad Hoc Working Group (Tabbed)
2
provides a
very good summary of the situation and the relevant considerations for
US policy at this time. I am summarizing the main points below, but I
recommend that you read the entire paper.
Situation
Allendes public posture in recent weeks indicates that he has em-
barked on a course to justify limited or no compensation to the copper
companies, and to pin the blame on the US for Chiles economic
problems and for any deterioration in US-Chilean relations. The GOC
has chosen to make a public issue of the Ex-Im Banks position on the
Boeing loan, and has achieved wide support on this issue. Ambassador
Letelier has indicated that he will be delivering letters to Secretary
Rogers and the President shortly.
The GOC apparently intends to complete the process of estab-
lishing compensation for the copper companies by October 14. The pro-
visions of the law do not permit a settlement which would be ade-
quate under normal standards, but Allende does have the flexibility to
provide compensation approaching book value, which probably would
be acceptable to the companies.
Ambassador Korry has been active in suggesting that a pragmatic
settlement would have some benefits for the GOC, but so far the GOC
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H112, SRG Meetings, Chile, 9/9/71. Secret; Nodis. Sent for
information.
2
The September 8 paper, prepared by the Ad Hoc Interagency Working Group on
Chile, is Document 81 in Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973.
378-376/428-S/80023
682 Foreign Relations, 19691976, Volume XXI
has not pursued any possibilities. Meanwhile, Chiles foreign exchange
reserves continue to decline and it appears that Allende will face a se-
rious foreign exchange crisis in early 1972. If he does not obtain unfore-
seen large inputs, he will be forced to drastically curtail imports, or to
seek rescheduling of debt payments or to default. However, even a
debt renegotiation would have to be accompanied by further stabiliza-
tion assistance.
Allendes Choice
Allendes choice is whether to seek a confrontation with us on
copper compensation or seek a pragmatic solution which would re-
open his access to international credits. Radical elements of the Socialist
Party are pressing for the first course on the grounds that it will lead to
a more rapid socialization of the country and would have the imme-
diate economic benefit of repudiating $1 billion in debt to the US. It
would also allow Chile to rally Latin American support for the popular
cause of opposing US economic aggression in Latin America. The
factors favoring a pragmatic settlement, however, would be Allendes
desire to attain a debt rollover and access to credits.
The Issue
Anaconda has proposed that we send an emissary to Chile to indi-
cate that if Chile provides satisfactory compensation, the US would
take a positive attitude to opening up international credit for Chile.
This could be done by a presidential emissary or by a third party such
as McNamara. The advantages and disadvantages of this course are
listed on pages 1011 of the State Paper (Tabbed). The basic consider-
ations are: (a) will offering the carrot have any serious impact on the
chances for compensation; (b) even if it would not, would it improve
our public posture for a confrontation; and (c) if the GOC agrees to a
deal, would we have to give so much (in terms of rollover and new
credits) that we would bail Allende out of the expected economic
crunch.
My own feeling is that if we pursue this course, it should be done
through a third party rather than by a direct USG representative. This
would have the advantage of avoiding a direct negotiation and would
keep the carrot somewhat fuzzy. It would also give us a third party to
attest to the reasonableness of our position if Allende choses to go the
confrontation route later.
Your talking points follow these general lines.
3
3
Attached but not printed.
378-376/428-S/80023
November 5, 1970December 31, 1972 683
257. Minutes of a Meeting of the Senior Review Group
1
Washington, September 9, 1971, 3:013:45 p.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger Treasury
Dr. Charls Walker
State
Mr. John Hennessy
Mr. John N. Irwin
Amb. Nathaniel Davis Justice
Mr. Samuel Eaton Attorney General John N.
Mr. Charles Meyer Mitchell*
Defense OMB
Mr. G. Warren Nutter Mr. Kenneth Dam
Mr. Armistead Selden
NSC Staff
Mr. Raymond G. Leddy
Col. Richard T. Kennedy
JCS Mr. Arnold Nachmanoff
Adm. Thomas H. Moorer Rear Adm. Robert O. Welander
Brig. Gen. Richard Hartman Mr. Mark Wandler
CIA
Mr. Richard Helms*
Mr. William Broe
*arrived at the meeting late
SUMMARY OF CONCLUSIONS
It was agreed:
We should find out if Secretary Connally still thinks we should
send a special emissary to Chile, as he proposed in his August 10 mem-
orandum to the President.
2
We will get a Presidential determination on whether he is pre-
pared to lift some of the credit restrictions on Chile if the Chileans are
reasonable in their dealings with the American copper companies.
Dr. Kissinger: The subject today is the expropriation situation in
Chile. The only issue is whether we should send a special emissary
down there to tell them we will take off some of our credit restrictions if
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H112, SRG Minutes, 1971. Secret; Nodis. The meeting took
place in the White House Situation Room. Kissinger initialed and wrote OK on a Sep-
tember 13 covering memorandum from Davis transmitting the minutes. (Ibid.) A copy
was sent to Kennedy and Nachmanoff. All brackets are in the original.
2
Document 244.
378-376/428-S/80023
684 Foreign Relations, 19691976, Volume XXI
they are reasonable in their dealings with the copper companies. Is that
right?
All agreed.
Dr. Kissinger: It seems to me that we are faced with our perennial
problem: (a) what are those guys up to; and (b) if we take the initiative,
will it deter them from their ultimate objective? Or, if we avoid con-
frontation, will we be better able to influence the situation later on?
What is States recommendation?
Mr. Meyer: You are aware of the added facets in the Chilean situa-
tion. We have three objectives which are not necessarily reconcilable.
The first is to keep the onus on Chile for causing a deteriorating situa-
tion. The second is to assure adequate compensation for the American
companies. And the third is to espouse the claims OPIC will inherit if
there is not adequate compensationand Im willing to bet there wont
be.
The Government of Chile might give a more liberal reading of her
expropriation law if she knew she would still be a member in good
standing of the world community. In other words, this is a positive ap-
proach. Even if Chile gets additional funds and credit, however, Im not
sure it will enable Allende to insure the success of his economic
program.
Dr. Kissinger: Let me, as usual, be the devils advocate. Suppose
we relax our credit restrictions, and, as a result, his economic program
succeeds. We may only get a psychological satisfaction from this
shifting of the onus to him, and our actions may not have made any dif-
ference at all.
If one makes the judgment that he is heading toward a one-party
systemand this is not contrary to any of the available evidence
which will be anti-U.S., then the easier his economic situation is, the
better he will be able to bring about a one-party system. In any case, he
can always find pretexts for doing whatever he wants to do. We should
consider relaxing our credit restrictions if we know that: (1) no matter
what he does, he will provide adequate compensation to the copper
companies; or (2) we think we might get him to follow a moderate
course.
Mr. Meyer: Opening up our credit to Chile would, in my opinion,
put the responsibility for ending up with a one-party system squarely
on his [Allendes] party. It could also defuse some of Chiles revolu-
tionary attractiveness.
Dr. Kissinger: What do you mean by opening up of credit?
Mr. Meyer: Im talking about a non-restrictive credit policy.
Dr. Kissinger: And you base your argument on the fact that he
wouldnt be able to claim were responsible for his economic failures.
378-376/428-S/80023
November 5, 1970December 31, 1972 685
Mr. Meyer: Thats right.
Mr. Helms entered the meeting at this point.
Mr. Nutter: Does Chile believe that she has a natural right to
credit?
Mr. Meyer: Sure she does, especially in the Inter-American Bank.
All the Latin American countries think they have a God-given right to
everything.
Mr. Selden: (to Mr. Meyer) Are you saying that if they fail econom-
ically, they will blame us?
Mr. Nutter: What would they blame us for?
Mr. Meyer: For imposing economic sanctions.
Mr. Nutter: The Marxists in Latin America blame us before they
take over a country, accusing us of economic imperialism. They also
blame us after they take over for refusing to lend them money. Were
faced with an argument we cant win.
Mr. Meyer: Its not only the Marxists who espouse that argument.
Dr. Kissinger: What is States recommendation? Do you think we
should send a special emissary, or should we make a proposition
through the Ambassador?
Mr. Meyer: I think we should be prepared to make a proposition.
However, I dont think we should do it right away.
Dr. Kissinger: Korry says that he has put some bait out, but that it
has not been taken.
Mr. Meyer: Thats because the President has been out of the
country.
Dr. Kissinger: Is the new Ambassador [Mr. Davis] here?
Amb. Davis: Yes. Here I am.
Dr. Kissinger: (to Dr. Walker) Whats your opinion?
Dr. Walker: First, let me say that I am happy to be here. Its better
than working on all the details of price control, the way we have been
doing during the last three weeks.
Dr. Kissinger: Thats the beauty of our meetingsthey go on for-
ever. You can come back in six months and pick up exactly where you
left off. Once we get the screen installed, well be able to push a button
and flash on argument X.
Dr. Walker: Seriously, we just received the paper this morning,
3
and I havent had time to study it very carefully. I did, however,
manage to spend a few minutes on it with the Secretary.
3
The September 8 Working Group paper. See Foreign Relations, 19691976, vol.
E16, Documents on Chile, 19691973, Document 81.
378-376/428-S/80023
686 Foreign Relations, 19691976, Volume XXI
The solution to the particular problem were discussing today
bears on our overall expropriation policy, except for the time factor. I
would like to point out that page 1 of the State paper says our policy
toward Chile has two basic purposes. The second of these is to maxi-
mize pressures on that government to prevent its consolidation and
limit its ability to implement policies contrary to U.S. and hemispheric
interests. That could be changed, but it is the policy. Therefore, Treas-
ury concludes that the proposition were discussing now would work
180 degrees in the opposite direction.
Dr. Kissinger: Why?
Dr. Walker: That man [Allende] has some very serious economic
problems. Anything we do that will bring about better economic terms
will help relieve those pressures I just mentioned.
Dr. Kissinger: I see.
Dr. Walker: What it all boils down to is that the U.S. Government,
albeit indirectly, in the short term at least, will be bailing out major
American corporations. If we are going to draw a check, it makes more
sense to give the money to Anaconda directly. We are strongly opposed
to this initiative.
Dr. Kissinger: Is that the Secretarys view, too?
Dr. Walker: Yes.
Dr. Kissinger: Either Korry or a visitor to my office said recently
that you were in favor of this proposition, and I was startled to hear
that.
Dr. Walker: In the Secretarys memorandum to the President of
August 10, he proposed that we send a special emissary to Chile.
Dr. Kissinger: But you are not in favor of the proposition made in
the State paper.
Dr. Walker: Thats right.
Dr. Kissinger: (to Mr. Helms) Dick, what do you think?
Mr. Helms: We should decide how much help we want to give An-
aconda. Im not really competent to discuss this problem. I would
think, though, that we would want to help Anaconda, if we could.
Dr. Kissinger: Our concern is with Chile, not Anaconda.
Mr. Helms: Would we let Anaconda sweat it out?
Mr. Meyer: We are focused on Anaconda for a number of reasons,
but we are really talking about all the OPIC-insured companies.
Dr. Walker: If the purpose of this initiative is just to help Ana-
conda, we would be against it. Instead we should be taking actions to
help all the companies, not because they are U.S. corporations, but be-
cause we should be trying to get the developing countries to provide a
378-376/428-S/80023
November 5, 1970December 31, 1972 687
climate which attracts private capital. There just isnt enough official
capital to go around.
Mr. Helms: Exactly what does OPIC do? Will it give X amount of
dollars to Anaconda as insurance if the company is not compensated? If
so, Anaconda doesnt lose in the end.
Mr. Meyer: Anaconda would still lose some money.
Mr. Helms: How much money is involved?
Mr. Meyer: Lets forget Anaconda for a moment. With Kennecott,
the compensation should be $180 million, and the insurance would
cover about 50 percent of that.
Attorney General John Mitchell entered the meeting at this point.
Dr. Kissinger: I dont think we need a White House decision on the
desirability of helping Anaconda. The proposition should be put in the
general context of our expropriation policy and our policy toward
Chile. Then it might be worthwhile to use it as a pretext for maintaining
a dialogue with Chile, and any help it would provide Anaconda would
be considered a bonus. I have not discussed this issue with the Presi-
dent. I sense, though, that his instinct would be to keep the pressure on
Chile.
(to Dr. Walker) My personal view is similar to yours. This is just a
way to give funds to Anaconda. How do we get a decision on the issue?
What about if we just send a special emissary?
Dr. Walker: Thats what the Secretary proposed in his memo-
randumto the President. He wrote: I recommend that you appoint im-
mediately a Special Presidential Envoy to communicate to President
Allende that it is your objective to be helpful to Chile if they are reason-
able, but to deny them credit facilities if they are unreasonable.
Dr. Kissinger: Isnt that what State is suggesting?
Dr. Walker: No. The Secretary said deny them credit facilities if
they are unreasonable. He is proposing a general posture.
Dr. Kissinger: I understand. We all agree. Suppose Chile says she
will pay adequate compensation. Thats reasonable. What makes you
think they will go through with their arrangements?
Dr. Walker: There would be a better chance of them doing so if
they make some public statements.
Mr. Selden: They would probably say they would pay a certain
amount, but then they would start making deductions for various
reasons.
Mr. Meyer: Allende can do that. However, he also has the au-
thority not to do it. Right now, Chile would probably pay nothing to
Kennecott. Anaconda would get something, and ITT is still up for
grabs.
378-376/428-S/80023
688 Foreign Relations, 19691976, Volume XXI
Mr. Nutter: How would all of that change if we gave them a loan?
Mr. Meyer: I dont know.
Mr. Irwin: The main issue before us is whether we should take an
initiative with Chile right now. State feels that we should not do so.
This is largely a result of the discussions Korry has been having with
the Chilean officials.
Dr. Kissinger: Suppose we took an initiative right now. Wouldnt
they scream about the American economic aggression?
Mr. Irwin: Thats the reason we shouldnt do anything now.
Dr. Walker: The Secretary was talking about a general case of ex-
propriation in his memorandum. I think I could state his view most
clearly if I read from the memo. He wrote: It may be too late to divert
the Chilean Government from its intended course of virtual confisca-
tion of this important foreign property. However, I believe the U.S.
must take every effort to clearly communicate to the Chilean officials
that if they are reasonable, we will work to restore their international
credit standing, and if they are unreasonable, we will take active efforts to
deny them additional credits not only from the United States and mul-
tilateral authorities but from other donor countries too. They must be
able to see the benefits they would be denying their people through
their own unreasonable actions.
Mr. Irwin: Its my understanding that we have told the negative
part of those remarks to the Chileans. We have not given them the posi-
tive part, though, and I think we should present the two parts at the
same time.
State does not want to take the initiative now. If, however, Chile
lives up to her international obligations, perhaps we can do it. Only
then would it be worth doing.
As Charlie [Meyer] said before, you can argue that even if they had
credit, they would still probably not be able to do well economically
and giving them the credit wouldnt necessarily mean anything. In ad-
dition to the economic question, we also have to consider the political
reaction in Latin America. As soon as Chile charges us with economic
aggression, the other countries will pick up the charges.
Frankly, Im not at all sure where we should go. I can understand
the point about not doing anything to help Chile and letting her go
ahead with unfair compensation. Even if Allende does all he can for the
companies under the law, I doubt that the compensation would be
adequate.
Dr. Kissinger: Are you saying, then, that we should do nothing?
Mr. Irwin: Yes.
Dr. Kissinger: The issue we want the President to decide is
whether we do nothing or whether we send a special emissary to Chile.
378-376/428-S/80023
November 5, 1970December 31, 1972 689
Dr. Walker: We should get an answer to the Secretarys August 10
memorandum. One basic point we have to keep in mind is that it is
doubtful Allende will do what we want, even if we send a special
emissary.
Dr. Kissinger: If there is such a doubt, why do we have to send an
emissary at all? The new Ambassador will be meeting with Allende
and other officials when he goes down there. Cant he get this note into
the conversations he will be having?
Mr. Selden: (to Mr. Irwin) You said Korry has already stated the
negative part.
Mr. Irwin: Thats right. He never expressed the positive part be-
cause there has never been an expression of U.S. Government or Presi-
dential policy.
Dr. Kissinger: The President established the Chile policy inde-
pendent of the expropriation issue. (to Dr. Walker) Charls, first you
should find out if the Secretary thinks the special emissary is still
needed. We also need to get a Presidential determination on whether
he is prepared to lift some of the credit restrictions if the Chileans are
reasonable. If the President is so disposed, perhaps we can send a spe-
cial emissary or make an initiative in a more low-key way, such as
through the new Ambassador. Is that a fair statement?
All agreed.
378-376/428-S/80023
690 Foreign Relations, 19691976, Volume XXI
258. Memorandum for the Record
1
Washington, September 9, 1971.
SUBJECT
Minutes of the Meeting of the 40 Committee, 9 September 1971
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. John Irwin, Admiral Moorer, and
Mr. Helms
Messrs. Charles A. Meyer, William Broe, [name not declassified] were present for
Items 1 and 2.
Messrs. Thomas Karamessines and Wymberley Coerr were present for Items 1, 2
and 3.
1. ChileBasic Options on El Mercurio
a. The meeting began with a lengthy summary of the political and
economic pressures being exerted on the Santiago daily El Mercurio,
which is a symbol and surviving bulwark against the totalitarian thrust
of the Allende regime. The country team had recommended the expen-
diture of $1,000,000 to keep the paper in operation as the last independ-
ent, major non-Marxist daily in the country.
b. The Allende approach of harassment and pressure through tax
investigations, denial of loans, termination of credits and other squeeze
tactics was described. The prognosis was not good.
c. The discussion centered around how far the projected monies
might go and whether the paper would go down fighting. The
Chairman thought they should open up now with added support from
the International Press Institute and all others dedicated to freedom of
the press. The pull in the discussion was between the idea of money
going down the drain in a lost cause and helping the paper to fight with
some aplomb to the bitter end.
d. Mr. Helms was pessimistic, noting that the difference between a
Nazi-type seizure of the plant by storm troopers and the slow strangu-
lation by nonspectacular methods was one of sophistication.
e. It was realized that Allende could cut off the water at any time of
his own choosing. The Chairman polled the principals around the
table. Mr. Irwin for State said he was aware of the realities of the situa-
tion but felt State would hate to see the organ disappear without a vo-
ciferous campaign. Admiral Moorer said he felt we were gambling
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
Minutes of 40 Committee. Secret; Eyes Only. Drafted by Jessup on September 16. A copy
was sent to Mitchell, Packard, Johnson, Admiral Moorer, and Helms.
378-376/428-S/80023
November 5, 1970December 31, 1972 691
with a loser and the expenditure of funds was extravagant. The At-
torney General summarized: We should keep a strong voice alive but a
weak one would not be worth it. Mr. Packard concurred. Mr. Meyer ac-
knowledged the rat-hole aspects of the subsidy but thought we should
still make a fight. Mr. Helms felt that the prospects were not good, ei-
ther on a short term or long term basis.
f. The Chairman commented that a fighting newspaper might
force Allende into egregious action. The Attorney General urged that if
the proposal were voted down the USG should not be a drop-out but
try to come up with some new ideas.
g. The Chairman then stated that he would take the matter to
higher authority. The options were described as (1) to put up the
money to keep the paper going for an indefinite period, recognizing the
risks and uncertainty, but keeping an opposition voice in being as long
as possible while mounting an intensive campaign against Allendes
infringement of freedom of the press; and (2) to allow the paper to go
under while still making an issue of freedom of the press.
h. On 15 September higher authority determined that covert
funding in the amount of $700,000 should be made on condition that El
Mercurio launch an intensive propaganda campaign on the freedom of
the press issue.
[Omitted here is discussion unrelated to Chile.]
Peter Jessup
259. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 13, 1971.
SUBJECT
Request for Covert Funding of Chilean Newspaper
At its meeting on September 9 the 40 Committee considered a re-
quest from the owners of El Mercurio, the largest anti-government
newspaper in Chile, for $1 million to prevent the newspaper from
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 775,
Country Files, Latin America, Chile, Vol. V. Secret; Sensitive; Eyes Only; Outside System.
Sent for action. A stamped notation on the memorandum indicates the President saw it.
378-376/428-S/80023
692 Foreign Relations, 19691976, Volume XXI
going under.
2
President Allende appears to be increasing the financial
pressure against El Mercurio in an effort to close down the last major
opposition voice in Chile. An immediate decision is required in order
to take advantage of an opportunity to utilize an unique funding
channel through which we can provide $700,000.
The issue is a particularly difficult one because Allende has a va-
riety of ways in which he can close down the paper if he really wants to
(e. g., through control of newsprint, or labor stoppages). Thus, even if
we provide $1 million, there is no assurance that Allende wont force El
Mercurio out of business anyway before long.
The 40 Committee considered two options:
Option 1: To put up the money to keep the paper going for some indefi-
nite period, recognizing that its future status would still be uncertain
and risky. The purpose would be to keep an opposition voice going for
as long as possible and to give El Mercurio time to mount an intensive
propaganda campaign against the Allende governments efforts to cur-
tail freedom of the press.
Option 2: Allow the paper to go under and attempt to make as much of
an issue as we can on freedom of the press, recognizing however that
Allende could claim that the paper folded because of financial
mismanagement.
All of the members of the 40 Committee agree that Option I is a
very expensive proposition with uncertain gains. State favors going
forward despite the risks. The Attorney General and Dick Helms be-
lieve it is probably not worth the cost. Defense and JCS are not enthusi-
astic about Option I, but indicated that they would go along with it.
I recognize that this is a high-cost, high-risk operation, but I believe
it is worth trying. I think we should provide the initial $700,000 to buy
more time for El Mercurio, but only on the understanding that the news-
paper will launch a massive propaganda campaign against Allendes
efforts to use economic and political propaganda to close down the
paper. El Mercurio would be expected to use the additional time to try
to embarrass Allende by describing his dictatorial tactics and appealing
for moral and financial support from the free press throughout the
world.
Allende obviously feels it is to his advantage to try to silence this
last remaining opposition voice as he heads towards a confrontation
with us over copper compensation and as he proceeds with his own in-
ternal political strategy. Allende apparently plans to call for a plebiscite
to reform the constitution and create an unicameral legislature which
would be more subject to his control than the present legislature. As he
2
See Document 258.
378-376/428-S/80023
November 5, 1970December 31, 1972 693
proceeds towards this objective, it would obviously be to his advantage
not to have criticism from an independent, widely-read newspaper.
Moreover, I believe it would be useful to us to try to have El Mercurio
create a good diversionary issue on freedom of the press before Allende
can rally full support for his confrontation with us over compensation
to the copper companies. Even if El Mercurio can only survive for
three-four more months, this may well be the most critical time in
which an opposition voice in Chile can be useful.
Recommendation
That you authorize covert funding of $700,000 to El Mercurio, on
the condition that El Mercurio will launch an intensive propaganda
campaign against Allende on the freedom of the press issue.
3
3
The President initialed the Approve option on September 13.
260. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 27, 1971, 2215Z.
4987. Pass OPIC. Subj: Talking Copper with Allende. Ref: Santiago
4975.
2
1. Following is summary of talk with Allende and Almeyda today
on copper and which will be reported more fully tomorrow among se-
quels to reftel (copper crunch).
3
Allende said he would have Arrate
give me preview tomorrow on Presidents findings on excess profits to
be made public Sept 29. Allende sought in cordial fashion to persuade
me that because of unanimously passed copper bill his hands were
quite tied, that therefore he could not respond fully to a very good
initiative on my part, that compensation for Kennecott may well in-
volve a partial repudiation of (OPIC-insured) indebtedness to the com-
pany, and that he has still not decided whether to invoke later his Presi-
dential privilege to repudiate debts contracted with third parties (not
ExIm) because the funds were not usefully employed. He left me with
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Con-
fidential; Immediate; Exdis.
2
Dated September 27. (Ibid.)
3
Telegram 5020 from Santiago, September 29. (Ibid.)
378-376/428-S/80023
694 Foreign Relations, 19691976, Volume XXI
the impression that no material carrots of any kind nor possible sticks
of retaliation had swayed a calculation that was largely based on do-
mestic political considerations and his reading of world conditions.
While he did not specifically close any door and while he probed for
ways to avoid some conflicts, it was fairly clear that the key decisions
had already been taken and were founded on the specious (and chal-
lenged) arguments relating to the restraints of the constitutional meas-
ure. Allende insisted that the ITT matter be kept separate and repeated
the arguments in favor of an independent physical appraisal with CTC
under Chilean management.
Korry
261. Memorandum From Ashley Hewitt of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 29, 1971.
SUBJECT
The Copper Crunch in Chile
President Allende last night signed a decree determining that
mines operated by Kennecott and Anaconda in Chile have earned some
$774 million in excess profits since 1955. He was required to make this
determination under the amendment to the Constitution which nation-
alized the copper industry last July. Two other American-run mines,
Andina and Exotica, were not mentioned in the decree since they have
just begun production and have earned no profits.
The copper nationalization amendment required the President to
determine excess profits and the Controller General to determine the
net assets of the companies after deductions for various reasons. The
decision of the Controller on assets is not due until October 15. Taken
together, the figures on net assets and excess profits would determine
the level of compensation to be paid to the companies. Even without
deductions, however, the assets of the companies were not expected to
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Confidential. Sent for information. A
stamped notation on the memorandum indicates Kissinger saw it. Haig initialed the
memorandum.
378-376/428-S/80023
November 5, 1970December 31, 1972 695
be more than $500 million. Hence, Allendes decision setting an extraordi-
narily high figure for excess profits indicates not only that no compensation
will be paid, but that the companies may well wind up owing the government.
The government may use this device to justify default on some $185
million owed to the American copper companies as a result of its pur-
chase of a 51% interest in the equity in 1967 and 1969. About $85 million
of this debt is covered by OPIC insurance payable to Kennecott.
Allendes punitive approach to the copper companies is probably
based on domestic political considerations since it can only inhibit his
efforts to open up the flow of credit to Chile from international sources
and get the economy moving. His own Socialist Party is strongly op-
posed to payment of any compensation to the copper companies, and
the Communists looked for a minimal payment at most. Moreover, it is
difficult for the Christian Democrats to oppose the government line on
nationalization and compensation since the Frei government began the
process with the earlier takeover of a controlling interest in the com-
panies. However, the process is not yet complete, and it is possible that
Allendes action in setting such a high figure for excess profits is a tactic
of some kindnot likely, but possible.
262. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, October 3, 1971, 21550Z.
5077. Subj: Secretarys Interview with Almeyda. Ref: State 181568.
2
1. Almeyda on two recent occasions prior to my final meeting with
himand Allende Sept 27 said that he wished above all to meet with Sec-
retary to respond to latters letter of mid-August
3
that I had hand-
carried from Washington and that referred principally to copper. Al-
lende has in effect publicly responded to Secretarys letter by both
manner and content of his excess profits determination and what
GOC now proclaims to be the Allende Doctrine for the entire Third
World.
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Con-
fidential; Immediate; Exdis. Repeated immediate to USUN.
2
Dated October 1. (Ibid., POL CHILEUS)
3
Document 249.
378-376/428-S/80023
696 Foreign Relations, 19691976, Volume XXI
2. Almeyda, as Allende, will doubtless argue, as he did this week
in his speech to the UNGA, that the USG should not confuse its in-
terests with those of private companies and that problems between
those companies and GOC should not affect historically friendly
US-Chilean rels. (Incidentally the Soviet Ambassador here made pre-
cisely the same argument to me about one week before Allendes
copper determinations.) Almeyda will surely echo all the legalistic and
procedural justifications for Allendes and the GOCs actions. He might
even mention recourse to the special tribunal but as Dept aware Al-
lende and the GOC have said repeatedly that the excess profits aspects
of the Chilean judgements against the companies cannot be appealed.
4
The Secretarys letter and the accompanying Departmental note
5
antici-
pated these arguments by focusing on Allendes and the GOCs lati-
tude and by urging pragmatic efforts to arrive at just and mutually ac-
ceptable solutions.
3. I shall not presume to suggest how the Secretary will remove
any doubts from Almeydas mind of our realization that the responsi-
bility for the uncompensated confiscation of Anaconda and of Kenne-
cotts properties remains with Allende. Nor whether and how the Sec-
retary may remind Almeyda that the USG made every effort to forestall
damage to our official rels by the unremitting effort made here to bring
about settlements that would permit the GOC to recover copper and
still satisfy its political needs. These efforts were spurned in favor of
unilateral and punitive action and in the expectation that any US reac-
tion could be presented as the cause of damage to our bilaterals.
4. Almeyda believes that his foreign policy has isolated the US on
the copper issue. Starting with the visit to President Lanusse of Argen-
tina (about to be reciprocated here) and followed by state visits to Co-
lombia, Ecuador and Peru, Allende has prepared a Latin nationalism
base so that any test of wills at this time with us would be on his terrain
and at his timing. Unlike the Peruvians in the IPC case, he probably in-
tends to keep provoking us to reactions that he reckons will solidify his
position within Latin America and the Third World.
5. Thus Almeyda will raise the candidacy of Felipe Herrera to be
SYG. In current circumstances, Almeyda might have an interest in
drawing a negative reaction from us. Any indication at this time that
we are prepared to oppose Herrera could be used internally and exter-
nally as evidence that differences between our two countries are the re-
4
The determination of excess profits, which the comptroller general would an-
nounce by October 14, could be appealed to a special tribunal of government officials and
judges. (Allende Sets Penalties for U.S. Firms, Washington Post, September 29, 1971,
p. A14)
5
See Document 250.
378-376/428-S/80023
November 5, 1970December 31, 1972 697
sult of our hostility and do not flow from unilateral Chilean actions.
Such a signal at this point would reinforce Latin solidarity based on
economic nationalism.
6. The copper action and the Herrera candidacy were deliberately
coincidental with the Chilean successful campaign to have UNCTAD
Three meet in Santiago next spring,
6
with the naming of Herrera as the
head of the preparatory committee for that session and with Almeydas
recent placement of Chile in the so-called non-aligned club. Yet reading
here of press accounts of Almeydas speech to the UNGA leaves the un-
mistakable impression that on all issues of importance he took posi-
tions that were indistinguishable from those adopted by the Socialist
camp. We believe that the GOC is fully committed to this line and that
any attempt by the Secretary to enter into substantive discussion of
such matters as ChiRep or Mideast would prove fruitless. Indeed the
most recent declarations of Socialist and Communist leaders here make
clear that both intend to accelerate and deepen the anti-imperialist
policies of Chile.
7. In sum, we favor Secretary making clear our disappointment
over the Chilean response to President Nixons invitation to set the
level and tone of rels. We would not recommend going beyond
that message to discussion of any possible future actions by either
government.
7
Korry
6
The third meeting of the UN Conference on Trade and Development was held in
Santiago in April 1972.
7
In telegram 3166 from USUN, October 5, the Mission reported that Rogers and
Davis directly asked Almeyda in their October 4 meeting about compensation for the ex-
propriation of U.S. copper companies. The Chilean Foreign Minister stated he did not
know if compensation would be granted. Rogers concluded by stating that the present
situation did not inspire confidence that Chilean Government was serious in trying to ar-
rive at just compensation. The meeting ended in an impasse. (National Archives, Nixon
Presidential Materials, NSC Files, Box 776, Country Files, Latin America, Chile, Vol. VI)
378-376/428-S/80023
698 Foreign Relations, 19691976, Volume XXI
263. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, October 5, 1971.
SUBJECT
Dinner at Chilean Embassy on Wednesday, October 6, 8:30 p.m.
You are scheduled to attend a dinner at the Chilean Embassy
Wednesday evening in honor of the Chilean Foreign Minister Clodo-
miro Almeyda. The dinner begins at 8:30, and I have informed the
Chilean Ambassador that you will have to leave early. As we discussed
this afternoon, Ambassador Davis and I will ride over with you so that
you will have an opportunity to get acquainted with Davis.
Detailed biographic data on Almeyda is at Tab A.
2
I have marked
the most interesting points.
As I mentioned to you, I think it would be useful for Ambassador
Davis to be present at any discussion you may have with Almeyda, be-
cause he can interpret or monitor Ambassador Leteliers interpretation.
It would obviously also enhance Davis status with the Chileans. Davis
has worked on the White House Staff (under Rostow) and understands
clearly that he would be at your service only if you want him to be
present for your conversation with Almeyda.
It is not at all certain that Almeyda will seek to have a private con-
versation with you, or that he would have anything substantive to say.
However, it is conceivable that if the Chileans are interested in a negoti-
ation or understanding (which appears very unlikely at this point), Al-
meyda might make an approach to you. (You will recall Ambassador
Leteliers suggestion to you that Allende would welcome a funda-
mental discussion with you.)
3
Ambassador Davis who was present at Secretary Rogers meeting
with Almeyda Monday,
4
indicated that Almeyda did not make any ap-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Secret; Eyes Only. Haig initialed the memo-
randum. A covering memorandum by Nachmanoff states that the Soviet Ambassador
and possibly two Ambassadors from the Eastern Bloc would be present at the October 6
dinner at the Chilean Embassy. Members of the press corps, specifically representatives
from the New York Times and the Washington Post, would probably also be in attend-
ance. (Ibid.)
2
Tabs A, B, and C are attached but not printed.
3
Reference is presumably to the meeting between Kissinger and Letelier on August
5. See Document 242.
4
October 4. See footnote 7, Document 262.
378-376/428-S/80023
November 5, 1970December 31, 1972 699
proach or significant response with Secretary Rogers. Rogers was very
frosty with Almeyda and made clear his strong disapproval of Al-
lendes recent determination setting excess profits of the copper com-
panies at $774 million, a figure higher than any conceivable figure
which might be set for compensation. (This determination was solely
within Allendes discretion, was based on arbitrary criteria applied
ex post facto, and apparently is not subject to appeal.) Almeydas reac-
tion reportedly was simply to repeat the standard Chilean arguments
about following constitutional requirements. No other subjects were
discussed.
If you have an opportunity to talk privately with Almeyda, your
purpose should be: (1) to emphasize that we regard Allendes recent ac-
tion as a political decision to move toward confrontation and (2) to give
Almeyda an opening, in the unlikely event he wants one, to seek a
pragmatic way to avoid confrontation. Following are some suggested
talking points:
Note that, as the Foreign Minister knows from his talks with
Ambassador Korry, we have always been ready to seek pragmatic, mu-
tually acceptable solutions to any differences which may arise.
We are, therefore, disappointed that President Allende has
chosen a course with regard to compensation (by his discretionary de-
cision on excess profits) which appears to eliminate any hope for a
pragmatic settlement in accordance with international norms.
Ask whether it is correct to assume that President Allendes de-
cision represents a desire to move toward confrontation with the
U.S., whose consequences the Chilean Government undoubtedly has
considered.
If Almeyda maintains that Allende had no choice under Chilean
law, you should quickly:
Indicate that it is our understanding that President Allende had
discretion and did not have to make the sweeping judgment he did
with respect to excess profits. We can only assume, therefore, that this
was a political decision on his part.
Almeyda may indicate that his government does not want a con-
frontation and that he does not believe that the U.S. Governments rela-
tions with the GOC should be determined by a matter affecting private
interests. If so, you should:
Note that our Government has very clear legal and moral obliga-
tions with respect to the rights of U.S. citizens. These obligations are
well known to the Chilean Government, and we therefore must assume
that the GOC understands the consequences of its actions.
You should avoid reference to any specific sanctions which might be ap-
plied, so as not to give Almeyda any pretext for claiming that you
378-376/428-S/80023
700 Foreign Relations, 19691976, Volume XXI
threatened economic coercion. If Almeyda expresses any interest in finding
a pragmatic solution to the copper compensation problem, you should:
Note that Ambassador Korry has offered some proposals, and
that we would be prepared to consider any counter-proposals which
the GOC might wish to offer. Note that Ambassador Davis will soon be
in Chile and would be prepared for further discussions.
I am attaching for your background information the talking points
prepared for Secretary Rogers meeting with Almeyda (Tab B) and
Korrys suggestions for the Secretarys meeting (Tab C). I have sent
Korry a back-channel message
5
soliciting his thoughts and suggestions
for your meeting with Almeyda, and I will provide his response to you
before the dinner Wednesday evening.
5
No record of this message has been found.
264. Memorandum of Conversation
1
Washington, October 6, 1971, 9 p.m.
PARTICIPANTS
Minister Clodomiro Almeyda, Foreign Minister of Chile
Ambassador Orlando Letelier, Chilean Ambassador to U.S.
Dr. Henry A. Kissinger, Assistant to the President for National Security Affairs
Ambassador Nathaniel Davis, U.S. Ambassador to Chile
Arnold Nachmanoff, National Security Council Staff
Foreign Minister Almeyda opened the conversation by saying he
welcomed the opportunity to talk with Dr. Kissinger. He was con-
cerned that misrepresentations in some sectors of the U.S. press con-
cerning the question of compensation for U.S. copper companies might
have an adverse impact on relations between the United States Govern-
ment and the Chilean Government. He wished to explain that the $774
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Confidential; Nodis. Drafted on October 7.
The meeting took place at the Chilean Embassy. In a covering memorandum to Kissinger,
Nachmanoff informed him that I have drafted the memorandum in a form which I be-
lieve would be suitable for distribution to State. Moreover, he suggested it would be de-
sirable to disseminate the memorandum of conversation, both for bureaucratic pur-
poses and to take Ambassador Davis off the hook. Kissinger initialed his approval for
distribution. (Ibid.)
378-376/428-S/80023
November 5, 1970December 31, 1972 701
million excess profits figure recently established by President Allende
would be deducted from the Chilean Governments 51% of the copper
properties as well as from the United States companies 49% share. He
also noted that the determination of excess profits was only one stage in
the process of establishing compensation for the companies and that
the process would not be completed until the Comptroller Generals
decision in mid-October. The Minister commented that Chile was un-
dertaking an important experiment in social and economic change. It
wished to maintain good relations with the United States. He expressed
his hope that the compensation issue would not spill over and affect
overall Chilean-U.S. relations.
In reply, Dr. Kissinger noted that the U.S. Government does not
control the press. He indicated that the United States also wished to
maintain its traditional good relations with Chile. He stated that while
the internal structures which the new Chilean Government has
adopted might not be our preference, we consider Chiles internal
changes to be a matter for the Chileans to decide. Our policy toward
Chile, therefore, will not be determined by Chiles internal processes,
but primarily by Chiles foreign policy towards the United States and
its policies in the Hemisphere.
Dr. Kissinger pointed out, however, that the United States Govern-
ment also has certain legal obligations with respect to protecting the
rights of U.S. citizens which have a bearing on our relations. Therefore,
the question of compensation for the copper companies can have im-
portant consequences for U.S.-Chilean relations. With regard to the
Foreign Ministers comment that the Chilean process for establishing
compensation was not yet completed, Dr. Kissinger commented that
the U.S. Government would not make definitive judgments or take
hasty actions before the process is completed. We will wait to see the
outcome of the process. Dr. Kissinger stated that, as the Foreign Min-
ister knows from his conversations with Ambassador Korry, we believe
that with good will on both sides, there may be pragmatic ways to
achieve a mutually acceptable solution to this problem. The important
thing is to get a solution to the copper question which is acceptable to
both sides. Dr. Kissinger said that, with a satisfactory compensation
formula, he saw no reason why the traditional good relations between
the U.S. and Chile should not continue.
The Foreign Minister indicated that he understood Dr. Kissingers
point. He briefly reviewed the process by which the Constitutional
Amendment was approved by the Chilean Congress, and some of its
provisions. He stated that the steps taken thus far by the Chilean Gov-
ernment were required by the Constitutional Amendment, which he
noted had been approved unanimously. President Allendes determi-
378-376/428-S/80023
702 Foreign Relations, 19691976, Volume XXI
nation regarding excess profits was part of the process required by the
Constitutional Amendment.
Dr. Kissinger said he did not want to discuss details, but it was his
understanding that President Allende had discretion with regard to es-
tablishing excess profits and that, for example, he could have estab-
lished a different formula for determining excess profits. Had the Presi-
dent exercised his discretion differently, there might have been no
problem with respect to excess profits.
Foreign Minister Almeyda asserted that it would have been im-
possible politically for a Socialist government to consider acceptable a
higher level of profitsfor example, 20%. Moreover, it was necessary
for President Allende to set the acceptable rate of return within the
range established by the Andean code,
2
i.e., within 814%. The Foreign
Minister commented that political realities made this a very difficult
problem for the Chilean Government. He hoped the U.S. would under-
stand this and that it would be possible to de-limit the effects of the
copper compensation issue on our overall relations. He emphasized
that Chile is not seeking a confrontation with the United States, nor
some sort of apocalyptic outcome.
Dr. Kissinger replied that the United States had no interest in
seeking a confrontation either. He said that we understand the political
realities in Chile, but the Chileans should understand that there are po-
litical realities in the U.S. too. He noted that the art of statesmanship
was to take into account and steer between these political realities to
find solutions which are mutually acceptable. With goodwill on both
sides, this should be possible.
The Foreign Minister agreed and reiterated his hope that with
goodwill the areas of difference could be de-limited.
Ambassador Davis pointed out there was a significant distinction
between the Foreign Ministers reference to de-limiting the effects of
the compensation issue on our overall relations and Dr. Kissingers
point about the importance of a satisfactory outcome of the compensa-
tion question for our relations.
Dr. Kissinger said that he wanted to make clear that from our point
of view, the process by which the Chilean Government achieves the
outcome of the compensation issue is not as important as the outcome
itself. From the U.S. point of view, it is important that the outcome re-
sult in a satisfactory level of compensation to the copper companies.
Whether the Chilean Government arrives at this outcome unilaterally
2
The Andean Foreign Investment Code, adopted by Chile, Peru, Bolivia, Ecuador,
Colombia, and Venezuela on December 31, 1970, aimed to regulate foreign investments
in the region.
378-376/428-S/80023
November 5, 1970December 31, 1972 703
by some formula, or by negotiation with the copper companies is essen-
tially the Chilean Governments choice. However, we stand ready to
cooperate in trying to find a mutually acceptable solution.
The conversation closed with affirmations on both sides of a desire
to maintain the traditional good relations existing between the two
countries.
3
3
Davis summarized the conversation in an October 7 memorandum to Rogers.
(National Archives, RG 59, Central Files 197073, POL CHILEUS)
265. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, October 8, 1971, 2320Z.
5184. Pass OPIC.
1. Departure call on Allende at noon today became one-hour
business session that he concluded by saying it was surely the most
unusual farewell protocol visit ever on a Chilean President and in
which he made the following substantive declarations:
A. He was fulfilling his promise to me on compensation to Cerro.
The company would receive the amount agreed upon although the
Comptroller would, of course, fix the interest and term. He had spoken
to the Comptroller again and was confident that this matter would be
settled more or less as originally negotiated. Had Cerro accepted his
suggested change in May, it would have been settled then (sic).
B. The GOC was confident that its interpretation of the Constitu-
tion prohibiting appeals against the Presidents excess profits deduc-
tions would be upheld by the special tribunal but he expected the com-
panies to challenge to the maximum.
C. If he were Anaconda, he would seek payment in courts outside
rpt outside Chile for the Chilean obligations issued in 1969 as compen-
sation for the 51 per cent sold of Chuqui and Salvador. He was no
lawyer but he thought the company would probably win and that
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Con-
fidential; Exdis.
378-376/428-S/80023
704 Foreign Relations, 19691976, Volume XXI
Chile would be compelled to pay. (Outstanding principle is 160 mil-
lion over some ten remaining years at six percent.)
D. Exotica would also receive some compensation but the technical
problems were so difficult and were having such a ruinous impact on
Chuquis quality and sales that the processing of Exotica ore might
have to be stopped for some time and he might well have to invoke his
Presidential rights under the Constitutional reform to nullify some
loans for alleged misuse.
E. He agreed that it would be useful for ITT to resume the tele-
phone negotiations promptly with the GOC and he trusted I would so
inform ITT.
2. Allende said he wished this final conversation to be as
straight-forward as all our previous ones. Therefore, he was volun-
teering the facts about Cerro. He said he had just left a meeting about
Exotica and if I wished to hear the same briefing that he had just been
given, he would bring in Wilhelm and Arrate, GOC copper executives.
I accepted and Wilhelm provided details confirming what we already
knew about the technical problems that were sharply curbing produc-
tion and affecting the quality of the more valuable neighboring output
of Chuqui which tolls Exotica ore. I said that it had been our hope that
an amicable settlement with the US companies could have maintained
technological and commercial contacts that would have permitted
eventual resolution of such thorny problems. Wilhelm disclosed he
was about to sign a contract with an Arizona firm for solution of Exo-
ticas problem. He agreed that only North America had the experience
with oxide ores of the kind posed by Exotica.
3. When I reviewed my understanding of the dynamics of the rela-
tions between Chile and the US, including my feeling that the UP gov-
ernment had rushed into a copper reform law of historical moment
without full knowledge and my disappointment that political will had
not overcome either the legal or technical arguments as put forward by
Wilhelm, Allende, expressing agreement, reviewed the history of the
formation of the copper corporation (CODELCO) for which he took
much credit and added that during his three decades in Congress no
one had supplied or understood the relevant facts. Indeed, he had not
understood the intricacies until very recently, particularly as they af-
fected the USG. By then, a bill had been passed unanimously with
clauses that the Christian Democrats had in particular wished. He as-
serted the PDC had pushed the anti-Kennecott revaluation of assets
amendment that had proved particularly rigid for those who wished to
be more political and less legal in their outlook. He argued again that
this limitation had affected maneuverability with Anaconda.
378-376/428-S/80023
November 5, 1970December 31, 1972 705
4. Arrate interrupted to say that the President had given the fullest
consideration to the alternatives that I had suggested in August
2
but as
much as they appreciated the intent and ingenuity, they simply could
not be fitted into the law as passed unanimously by the Congress. Al-
lende took up this point, adding that Latinos were extremely legalistic
and that when he had cast about for a method to avoid worsening the
problems, he had welcomed my suggestion as a possible starting point
but the legalists had shut off any detour in that direction. Allende said I
was totally correct in my analysis of past dynamics but he hoped the US
could be equally realistic in its analysis of the future.
5. I countered with the political realities of the US. He had to pro-
vide some basis that would enable the USG to assume Allende was
genuinely seeking a practical accommodation and not taking refuge in
legalisms. I repeated my conversation with Tomic earlier this week
(Santiago 5158)
3
as an illustration of our difficulties in understanding
Chilean self-righteousness in changing its own rules three times in five
years. Social justice versus international norms of constructive dialogue
might be a case of right versus right but we would be soft-headed to be-
lieve it could be a matter of right versus wrong. The US taxpayer had
responded via OPIC and private investment to specific Chilean Govt
requests made by Tomic.
6. Allende at his most disarming political best listened not only
with attentive respect but articulated an assent that surprised Wilhelm.
He asked where might we go.
7. I said one critical question was the outstanding Chilean paper
for the 51 per cent purchased. Arrate made the point that there was a
distinction between the Kennecott and the Anaconda paper. I asked if
there were some way these international obligations could be honored.
Also, I wished to know if there were any legal way Allende could back
away from the repeated judgment that no appeal on his excess profits
determination could be allowed under the constitutional reform. Ar-
rate and Allende first argued that the amounts of the excess profits had
been misinterpreted since they were not judgments against the US
companies alone but against the joint ventures with CODELCOs in-
terests being as much affected as the US companies. Thus, said Arrate,
the question of any compensation depended on the Comptrollers final
assessment of the book value and the proportional share that might be
left for the US company. The excess profits deductions would be ap-
plied against this figure. Both acknowledged that for the three main
mines (Chuqui, Teniente, Salvador) no one could reasonably expect
2
See Document 251.
3
Dated October 7. (National Archives, RG 59, Central Files 197073, INCO 152
CHILE)
378-376/428-S/80023
706 Foreign Relations, 19691976, Volume XXI
compensation for the 49 percent holdings of the companies. As for Ten-
iente, Arrate admitted that the 51 per cent would also be wiped out by
their calculations and Allende again argued that he had no alternative
under the Constitutional reform. He said Kennecott would not have re-
ceived compensation even if 25 per cent per annum profit were per-
mitted. (Comment: These assertions are simply not true since the reform
bill as OPIC and our Chilean lawyers read it, did permit Allende to
apply an analysis that could have permitted some compensation. I
doubt if he fully understood all the alternatives and I doubt if any of his
political or copper experts would have allowed him much latitude if he
had.)
8. I referred to Allendes insinuations that Anaconda was in a
better position. After noting again the Controllers role, Allende said he
was not a lawyer but that it seemed to him that if Anaconda tested the
validity of outstanding notes for the 51 per cent, it would probably win.
I asked if he were thinking of a Chilean court or a foreign one. He re-
plied that it would probably be outside Chile and that Chile would
probably be compelled to pay. Such litigations could add to tensions
unless good faith were assured, I noted.
9. I said that I was certain that FonMin Almeyda would explain
upon his return tonight why it was difficult for the US to accept the
Chilean actions, particularly since copper coincided with telephones.
Did Allende see any way that ITTs claims could be satisfied? Was he
disposed to negotiate realistically with the company and to do so now?
Allende replied that as with copper, the GOC only recently had fully
understood the problem; it had not had the OPIC contracts. Only when
I had written to Garreton had ITTs assertions been officially con-
firmed. He was prepared to resume negotiations immediately. I asked
if he were prepared to deal in a manner that could satisfy the company
since unlike copper there was neither a special law nor special legalistic
inhibitions. It was a matter of will applied to fair bargaining. Allende
said he could understand the advantages in a prompt effort to come to
terms on CTC.
10. I concluded that in effect he was arguing for more time to
permit the GOC to demonstrate its bona fides and to make its case in-
ternationally. I noted that there were already a considerable number of
influential Americans who believed they had been misled and who
would find it difficult to play the game of Latin legalisms. My own
view was that the true power of the US resided in its position as the
most vibrant market place for ideas, for products and for technology,
each of which was the result of our open-minded pragmatism. I had
been proud to represent those attributes in Chile the past four years
and my wife, as he had said at the opening of our conversation, had
demonstrated in evident and effective ways these same characteristics
378-376/428-S/80023
November 5, 1970December 31, 1972 707
by her warm and sincere affection for Chile. We wanted such contacts
to continue and we hoped the actions of his government would not di-
minish in any way the opportunities to do so. He bade me a farewell
that was, given the two witnesses, astonishingly friendly and warm.
Korry
266. Memorandum From the Deputy Under Secretary of State for
Economic Affairs (Samuels) to President Nixon
1
Washington, October 12, 1971.
SUBJECT
Statement on Chile
The Inter-Agency Expropriations Group in a meeting today on the
Chile expropriation situation unanimously recommended that the
United States Government make a statement tomorrow expressing its
deep disappointment at the determinations which have been made on
compensation for expropriated U.S. investments in Chile.
2
The Group
agreed that the statement should underline the violations of interna-
tional law which the Allende government has committed in taking its
position. The Group also agreed that we should stop short of an-
nouncing or giving warning of retaliatory measures by the United
States.
We take this view for tactical reasons. Fundamentally, we want to
concentrate public attention on Allendes wrongs rather than our reac-
tion. We will be free to take further steps at the time most suitable to
1
Source: Nixon Presidential Materials, NSC Files, Box 776, Country Files, Latin
America, Chile, Vol. VI. Confidential. Drafted by Fisher and cleared by Crimmins. Typed
at the top of the page is Approved by President with changes per Memorandum from
Gen. Haig to Mr. Eliot dated 10/13/71. The changes to the attached draft statement
were the addition of a penultimate paragraph which reads as follows:
Should Chile fail to meet its international obligations, it could jeopardize flows of
private funds and erode the base of support for foreign assistance, with possible adverse
effects on other developing countries. The course of action the Chilean Government ap-
pears to have chosen, therefore, could have an adverse effect on the international devel-
opment process.
2
The Chilean Controller General rules on October 11 that Anaconda and Kennecott
would receive no compensation after deductions for excess profits and Cerro would re-
ceive about $14 million. (Chilean Aide Rules Against Payments to 2 U.S. Concerns, New
York Times, October 12, 1971, p. 7)
378-376/428-S/80023
708 Foreign Relations, 19691976, Volume XXI
our own interest. These may include suspension of U.S. assistance pro-
grams for economic development (about $20 million), military assist-
ance ($5 million in FMS), Eximbank disbursements on outstanding
credits (about $30 million), and pressure on multilateral and third
country lending agencies. Another important consideration arguing
against retaliatory measures at this time is that there remains an ap-
peals process to a special tribunal, the utility of which we must yet eval-
uate in consultation with the companies. To react with specific actions
before the appeals procedure is completed or demonstrated to be inad-
equate would give Allende the opportunity to accuse the United States
of prejudging the legal process and of attempting to coerce Chile, thus
providing him an effective rallying point for consolidating his position
in Chile and elsewhere.
An additional short-range tactical consideration is our desire not
to prejudice the position of ITT, which has yet to complete negotiations
with the GOC on a possible buy-out of its properties which it values at
$153 million.
The proposed statement continues to serve the purpose set forth
early in our dealings with the Allende regime of insuring that he and
not the United States bear the onus for his own decisions and for his
failures. It also expresses unmistakably our dissatisfaction with Chilean
actions thus far on compensation, and provides a basis for taking what-
ever actions we find advantageous in the coming weeks.
It was the consensus of the Inter-Agency Expropriations Group
that you should not make a statement at this time. If you agree, the Sec-
retary would propose to issue a statement tomorrow along the lines of
the attached draft.
If you approve this approach, you may wish, in view of impending
Congressional action on the replenishment of the international lending
institutions, to consult now with key members of the Congress to ex-
plain the tactical nature of the proposed statement.
The attached draft statement reflects the views of the Inter-Agency
Expropriations Group, with the Treasury representative reserving his
position pending the return of Secretary Connally tomorrow.
Nathaniel Samuels
378-376/428-S/80023
November 5, 1970December 31, 1972 709
Attachment
3
Washington, undated.
Proposed Statement by the Secretary of State
The Controller General of Chile announced his findings on Oc-
tober 11 that no compensation would be paid for the U.S. copper
mining investments expropriated on July 16 except for modest
amounts in the cases of two smaller properties.
The United States Government is deeply disappointed and dis-
turbed at this departure from accepted standards of international law.
Under established principles of international law, the expropriation
must be accompanied by reasonable provision for payment of just com-
pensation. The United States had made clear to the GOC its hope that a
solution could be found on a reasonable and pragmatic basis consistent
with international law.
It appears that the major factor in the Controller Generals decision
with respect to the larger producers was the determination on Sep-
tember 28 of alleged excess profits. The unprecedented retroactive
application of the excess profits concept, which was not obligatory
under the expropriation legislation adopted by the Chilean Congress, is
particularly disquieting. The U.S. companies which are affected by this
determination of the Chilean Government earned their profits in Chile
in accordance with Chilean law and under specific contractual agree-
ments made directly with the Government of Chile. The excess profits
deductions punish the companies today for acts that were legal and ap-
proved by the Government of Chile at the time. No claim is being made
that these excess profits deductions are based on violations of Chilean
law. This retroactive determination has serious implications for the rule
of law.
The United States hopes that the GOC, in accordance with its obli-
gations under international law, will give further careful consideration
to this matter.
4
3
Confidential.
4
For Rogerss statement read to reporters by the Department Spokesman on Oc-
tober 13, and which included the paragraph in footnote 1 above see Department of State
Bulletin, November 1, 1971, p. 478. For the reaction abroad to the Secretarys statement,
see Foreign Relations, 19691976, vol. IV, Foreign Assistance; International Development;
Trade Policies, 19691972, Document 174.
378-376/428-S/80023
710 Foreign Relations, 19691976, Volume XXI
267. Transcript of a Telephone Conversation Between President
Nixon and the Presidents Assistant for National Security
Affairs (Kissinger)
1
Washington, October 12, 1971, 8:30 a.m.
[Omitted here is discussion unrelated to Chile.]
P: The only thing I see in the news is Chile, and I want to be tough
with them. Have you seen this?
2
K: Yes, Ive just seen it.
P: Are you preparing something to say? I will say something but I
want you to have your staffget Haig to, the toughest son of a bitch
youve got, to work something up. Its time to kick Chile in the ass.
K: The only thing it was being held up for is the Comptroller
General.
P: They have acted. Can you get a paper over to me?
K: I will have a paper.
3
P: I just want a strong statement knocking their brains out. What
will we do?
K: We can cut off their credit.
P: I want a strong statement kicking Chile in the ass. Have Con-
nally make it. Really blast their butts. And dont bring State into it.
What are they doing?
K: They are probably wringing their hands, but they should say
something too. I will call Connally this minute.
P: I want to over-act on this one and I expect State to tow the mark.
They have confiscated American property and we wont allow it.
K: That you should say. Well have a program by the end of the
day.
1
Source: National Archives, Nixon Presidential Materials, Henry Kissinger Tele-
phone Transcripts, Box 11, Chronological File. No classification marking. A tape re-
cording of Nixons side of the conversation is in the National Archives, Nixon Presiden-
tial Materials, White House Tapes, Conversation No. 2886.
2
On October 12, the New York Times reported: Hector Humeres, the Controller
General, who determines under the nationalization law what the Government should
pay, said [the previous day] that Anaconda and Kennecott, owners of a share of the two
largest mines, have no claim after deductions of excess profits and other penalties.
(Chilean Aide Rules Against Payments to 2 U.S. Concerns, New York Times, October 12,
1971, p. 7)
3
A separate paper from Kissinger has not been found. See, however, Docu-
ment 266.
378-376/428-S/80023
November 5, 1970December 31, 1972 711
P: I will know what to say, appropriate action, but I want the
strongest action on it and I want it highly publicized and highly visible,
and I want it on TV today.
K: Tomorrow would be better.
P: Okay, tomorrow.
4
[Omitted here is a brief exchange unrelated to Chile.]
4
During a telephone conversation at 3:05 on October 12, Rogers and Kissinger dis-
cussed how to respond publicly to the Chilean Governments announcement on expro-
priation. Rogers thought it wouldnt be wise for either Nixon or Connally to issue the
proposed statement. If you are willing to do it, Kissinger suggested, it would be more
effective. Rogers: We took the lead in the case of Peru [in order] not to invoke the Hick-
enlooper [Amendment]. I think we will have to invoke it this time. I will do it in my
name. Kissinger: The President wants a strong statement. Better from you. I dont
knowif you want it as a State matterlets do it. Or if you want it as a commercial matter,
thats fine. Rogers: IPC is a similar matter. Kissinger: The President wants to be
tough. Rogers: As tough as you want. (Library of Congress, Manuscript Division,
Kissinger Papers, Box 369, Telephone Records, 19691976, Telephone Conversations,
Chronological File)
268. Memorandum From Ashley Hewitt of the National Security
Council Staff to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, October 15, 1971.
SUBJECT
Status of Chilean Economy
Attached at Tab A is a CIA summary on the economy in Chile.
2
The report notes Allendes no-compensation decision on copper and
indicates that he was fully aware of the international consequences of
his decision and delayed it for some time on this account. However, he
finally decided the domestic political benefits of a hard line out-
weighed the danger to Chiles international credit standing. In other
areas of the economy, the report makes the following observations:
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Secret. Sent for information. Kissinger ini-
tialed at the top of the page.
2
Attached at Tab A is CIA Intelligence Memorandum ER IM 71201, The Chilean
Economy: Status Report, which is Document 86 in Foreign Relations, 19691976, vol.
E16, Documents on Chile, 19691973.
378-376/428-S/80023
712 Foreign Relations, 19691976, Volume XXI
Socialization of Economy
Allendes UP coalition regards the virtual acquiescence of the
opposition in the general outlines of the governments economic plan
based on the concept of an economy divided into public, private, and
mixed sectors as a major victory. While the achievement of this struc-
ture may take some time, the government has already gained or will
soon have indirect control over all key economic areas. The Communist
Party believes that success in socializing the economy will make the
revolution irreversible.
Industry
Increased purchasing power among lower income groups as a
result of government monetary policies has continued to nurture the
mini-boom in manufacturing, but growth is leveling off as plants reach
capacity production. Consumer goods have been the most active area,
but a massive government housing program has spurred the demand
for construction materials.
Agriculture
President Allende and other officials appear increasingly con-
cerned about the expected decline in agricultural production over the
next several years and the sharp increase in import requirements for
foodstuffs. Thus far, however, the government has proved unwilling to
modify its radical agrarian reform program in order to reduce the costs
in terms of lost production.
Distribution
Food and other consumer goods shortages have not yet reached
crisis proportions but are a source of increasing embarrassment to the
government. The government is countering increasing supply and dis-
tribution problems by increasing imports, at least as far as foreign ex-
change reserves permit.
Inflation
Officially the government has held inflation to 13% during the
past year compared to 30% for the same period in 1970. However, there
is some reason to believe that the actual rate of inflation may be double
the officially recognized rate. Nevertheless, the Allende government
has refused to face the political costs of austerity and has continued its
expansionary policies. Deficit spending now is running an estimated
30% of government expenditures. These policies cannot be continued
indefinitely.
Balance of Payments
Chiles net foreign reserves have declined more than $200 mil-
lion in the past nine months to an estimated $140 million. By the end of
378-376/428-S/80023
November 5, 1970December 31, 1972 713
1971, reserves could be as low as $100 million, or the equivalent of one
months imports.
Chiles foreign debt is estimated at $2.4 billion with a service of
more than $300 million annually. The U.S. is Chiles biggest creditor.
There have been indications that the Allende government may impose
a debt rescheduling on its creditors, and if its balance of payment con-
dition continues to deteriorate, may decide it has little to lose by simply
defaulting on its debts to the U.S.
Thus far the Allende government has been unsuccessful in ob-
taining significant loans or investment commitments in Western Eu-
rope, where most countries are following a wait-and-see policy.
Communist countries have shown some interest in providing
selective support and total Communist commitments to Chile have
reached $164 million, all designed to cover purchase of material and
technical expertise of the donor country. To date, no untied financial
assistance has been offered and the Communists have indicated no
commitment to underwrite the Chilean experiment.
269. Memorandum of Conversation
1
New York, October 23, 1971.
SUBJECT
Chile
PARTICIPANTS
Dr. Eduardo Frei
Assistant Secretary Charles A. Meyer
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Confidential; Limdis. Drafted by Meyer on
October 26. The meeting took place in the Waldorf Towers. Nachmanoff sent this memo-
randum of conversation to Kissinger under cover of a November 4 memorandum in
which he stated that Frei believes that Chile faces an economic disaster, that there is
growing disenchantment with the Popular Unity government, that the opposition is
more cohesive than before, and that the military is very largely antagonistic to the Pop-
ular Unity government. Frei, who told Korry after Allendes election that he saw no hope
for democracy in Chile, is still pessimistic, but apparently now feels there is some hope.
He urges that the United States maintain close relations with the armed forces no matter
what, and expresses his opinion that the best hope for the preservation of democracy in
Chile lies in the U.S.s ability to avoid giving Allende the chance to blame his inevitable
failure on the U.S. Kissinger initialed the covering memorandum. (Ibid.)
378-376/428-S/80023
714 Foreign Relations, 19691976, Volume XXI
Ex-President Frei covered the three aspects of Chiles current situa-
tion as he saw them. He emphasized that he was not placing himself in
the role of an advisor, but was reporting his convictions.
The first aspect was the economy of Chile. Dr. Frei stated that Chile
faced not an economic problem, but economic disaster. In his opinion
there are five time bombs, any of which could damage any economy.
These five are:
Wage increases up to 65%
Frozen prices
Federal spending 50% above budget
Artificially pegged value of the Escudo
Retrogression in the agricultural sector
Local investment has come to a total halt and all production is op-
erating at a loss. His estimate is that at least 35,000 of the managerially
and technically trained Chileans have emigrated, mostly (he thinks) to
the U.S.A.
The second aspect was the political picture in Chile. Dr. Frei stated
that Allende was more and more influenced by the coalition of the
Communists and the Socialist Left whose differences are only those
of timing of the conversion of Chile to an authoritarian state. The So-
cialists and Communists will, he said, continue to work together to
achieve this goal after which they may pull apart and, if so, the Com-
munists will prevail. He deprecated the Radical party as useless. He
considers the PDC more cohesive than at any time in recent years and
he said that both Tomic and Gabriel Valdes were now awake to the po-
litical reality of the U.P. The Nacionales and the PDC are more coopera-
tive than ever before although neither could publicly embrace the
other.
He believes disenchantment with the political situation (which is
also the economic situation) is beginning to permeate all classes of
Chilean society and he said that the campesinos are uniformly in a spirit
of open revolt.
He urged that we continue to maintain the closest possible rela-
tionship with the armed forces. He is convinced that the Air Force is
100% antagonistic to the U.P., the Navy a close second and the Army
80%. The Carabineros on the other hand are unexpectedly passive, pos-
sibly because the students in turn are relatively quiet.
He sees hope in the school and labor elections which have gone
against the U.P. and he believes that if a general election were held to-
morrow, Allende and the U.P. would be swept out of office.
Given all of these counter-weights (his word) he still is on balance
very pessimistic. He said there is a hope, but there is not much hope.
The third aspect was bilateral relations. Once again he urged we
maintain our relations with the military, saying the Chilean people and
378-376/428-S/80023
November 5, 1970December 31, 1972 715
their neighbors would understand this even if all other relationships
were to be cut off.
He asked me to tell the Secretary, and the President if possible, that
in his opinion the best hope for the preservation of the democratic
process in Chile lay in our ability to avoid giving Allende and the U.P.
the chance to blame their inevitable failure on the USA. In Dr. Freis
opinion this meant that we should not publicly threaten or condemn,
but should apply whatever necessary measures quietly (the Peruvian
treatment, 1969 to date). The Chilean people would clearly understand
this approach, he said, but would still rally behind Allende and their
flag if our measures were loud and public and condemnatory.
270. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, November 3, 1971.
SUBJECT
40 Committee MeetingCHILEFinancial Support for Opposition Parties
Friday, November 5, 19714:00 pm
The attached paper from CIA
2
proposes that continuing support
totalling [dollar amount not declassified] for the next year be provided to
the opposition parties in Chilethe Christian Democrats (PDC), the
National Party (PN), and the Democratic Radical Party (PDR)so that
they can:
oppose the UP plans to replace Congress with a unicameral leg-
islature via a plebiscite;
prepare for the 1973 congressional elections;
maintain and increase their mass media capabilities.
The Agency also proposes that [dollar amount not declassified] be au-
thorized for possible passage to the Independent Radical Movement of
the Left (MRII), a non-Marxist splinter of the Radical Party which has
remained within the UP coalition. The purpose of our support for MRII
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
Minutes of 40 Committee. Secret; Sensitive; Eyes Only; Outside System. Sent for action.
2
The October 29 memorandumto the 40 Committee is Document 88 in Foreign Rela-
tions, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
716 Foreign Relations, 19691976, Volume XXI
would be to try to keep the Radical Movement split and to foster dis-
sension within the UP. (Only [dollar amount not declassified] would be
passed initially, [less than 1 line not declassified] the MRII would not
know the real source of the funds at this stage.)
Opposition leaders believe that popular support for the Popular
Unity coalition has peaked and is now declining. Growing economic
problemsas evidenced by Allendes decision Tuesday to sharply re-
strict imports
3
are likely to result in a further reduction of support for
the Popular Unity parties. Thus, Allende may try to move soon to im-
prove his political control through a plebiscite, before economic condi-
tions deteriorate further. He might try to parley the nationalistic sup-
port he would obtain in a copper confrontation with the U.S. into a
plebiscite victory on the unicameral legislature. The Agency argues
that the opposition parties must be able to keep the Chilean public in-
formed about UP plans and pressures while maintaining party organi-
zation and discipline in preparation for the plebiscite and the 1973 elec-
tions. However, the opposition parties, in particular the PDC, are very
weak organizationally and structurally. Most of the funds which the
Agency proposes to provide would be used to strengthen the Partys
administration, staff support, and propaganda capabilities.
The Agency proposes to divide the funds as follows:
PDC. . . . . . . . . [dollar amount not declassified]
PN. . . . . . . . . . . [dollar amount not declassified]
PDR. . . . . . . . . [dollar amount not declassified]
The PDC has been promised [dollar amount not declassified] from
European sources if it can obtain a matching amount from other
sources. Thus, the Agency believes that its support would prime the
pump for the European funds.
CIA believes that the funds can be passed securely, though it notes
that the Chilean security services are increasing their capabilities and
will probably give increasing attention to the opposition parties
sources of funds.
The objectives of the proposed program are generally consistent
with previous policy decisionsi.e., to help maintain a viable opposi-
tion and to promote dissension within the UP. You may wish to use the
40 Committee meeting to obtain a status report on the capabilities and
prospects of the opposition parties, and the tensions within the UP.
With regard to the specific proposal, you may wish to focus the discussion
on the following points:
3
The Allende administration announced on November 2 that Chiles imports
would be restricted to avert a foreign currency reserve crisis. (Chile Cuts Imports to Es-
sentials, Washington Post, November 3, 1971, p. A4)
378-376/428-S/80023
November 5, 1970December 31, 1972 717
To what extent will our input of funds be a dis-incentive to the
parties to develop other sources of funding? Arent we in effect pro-
viding a permanent subsidy for the major part of their expenses?
If we are in fact the major source of funds, isnt there a high risk
that that will become obvious to Allende before long? How serious is
the risk of exposure?
What is the rationale for the distribution of funds among the
parties?
You may also wish to note that the proposal focuses solely on the
opposition parties and the one splinter group in the UP, but that a key
element for any serious internal change in Chile is the military. There
seems to be indications that Allende is increasingly concerned about
opposition within the military. Is there anything that might be done,
beyond regular military contacts and the military assistance program,
to strengthen opposition elements in the military?
Assistant Secretary Meyer and the Deputy Chief of Mission in
Santiago (because of Korrys departure) have concurred in the CIA
proposal.
4
4
In a memorandum to Johnson, Meyer recommended that he not oppose in Com-
mittee the proposal to provide [dollar amount not declassified] additional funds to the
Chilean opposition parties. A notation in an unknown hand at the bottom of the memo-
randum states, This is essentially ordered by the White House, which says no delay for
lack of money. (Memorandum from Meyer to Johnson, November 3; Department of
State, Bureau of Intelligence and Research, INR/IL Historical Files, Chile 40 Committee
Action after 1970)
378-376/428-S/80023
718 Foreign Relations, 19691976, Volume XXI
271. Memorandum for the Record
1
Washington, November 5, 1971.
SUBJECT
Minutes of the Meeting of the 40 Committee, 5 November 1971
PRESENT
Mr. Kissinger, Mr. Mitchell, Mr. Packard, Mr. Johnson, General Knowles, and
General Cushman
Messrs. Egil Krogh, John Holdridge, and William Nelson were present for
Item 1.
Messrs. Arnold Nachmanoff and William Broe were present for Item 2.
[name not declassified], Mr. Wymberley Coerr, and Mr. Thomas Karamessines
were present for Items 1 and 2.
[Omitted here is discussion unrelated to Chile.]
2. ChileFinancial Support of Opposition Parties and of the Independ-
ent Radical Movement of the Left
The discussion opened with Mr. Kissinger asking about the cur-
rent role of the military in Chile.
Mr. Broe replied that the military could be considered an opposi-
tion, but they dont have the will coupled with their built-in noninter-
vention syndrome. The Navy was considered solidly in opposition to
Allende but not so the Air Force.
Mr. Kissinger asked how is it that Allende has not yet learned of
outside support.
Mr. Broe replied that [less than 1 line not declassified] support served
as a smoke screen.
2
He went on to note that demands on us will be quite
substantial. [less than 1 line not declassified] for example, needed imme-
diate help and PDCs [name not declassified] had only recently asked for
monies for media shoring. At the same time, when Chiles economy is
deteriorating, the opposition finds it almost impossible to raise money
inside the country. He said Ambassador Davis and the Chief of Station
had been asked for an estimate of how much will be needed altogether.
Between now and election it could run as high as $3.5 million. Of
course, he added, we cant provide total support.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, 40 Committee
Minutes. Secret; Eyes Only. Drafted on November 15. A copy was sent to Mitchell,
Packard, Johnson, Moorer, and Helms. In a November 22 memorandum, Broe detailed
suggested revisions to the minutes. (Ibid.) Broes comments are noted in footnotes below.
2
In his November 22 memorandum, Broe stated that the Chileans had gone to Eu-
rope to raise funds and that fund-raising programs had been initiated by both the Nation-
alist and Christian Democratic Parties. (Ibid.)
378-376/428-S/80023
November 5, 1970December 31, 1972 719
Mr. Kissinger commented that for that kind of money we could
have had a landslide last election.
Mr. Broe said the figure could reach even $4.5 million and he re-
quested long-range guidance as to how far our support should go.
Mr. Johnson asked if Mr. Broe meant that if we arent going all the
way there is little point in going for the [dollar amount not declassified]
now.
Mr. Broe said, yes, in effect. They just dont have the money
themselves.
3
Mr. Kissinger asked why they dont have any money.
Mr. Broe said that Allende was rapidly drying up the sources.
Mr. Kissinger asked: Doesnt Allende wonder where the money
continues to come from when he knows its drying up? Hes not stupid.
How do they account for their funds?
Mr. Broe: In Chile, they are not required to account for it; they in-
dulge in double bookkeeping and anonymous gifts, and there has been
no seizure of opposition party books as yet.
Mr. Kissinger asked what the [dollar amount not declassified] will do,
and Mr. Mitchell asked how long it will last.
Mr. Broe said for about a year and supplied a rundown of pro-
posed allocations. He then added, We just have to face up to the fact
that if we want an opposition were just going to have to provide most
of the support.
Mr. Kissinger said Mr. Johnsons point had not been answered,
that theres not much point to giving the initial [dollar amount not declas-
sified] now if were not going to follow up with more.
Mr. Karamessines said a watershed point had been reached. Al-
lendes fortunes are not on the uprise. By mid-1972 hell either make it
or his fortunes will fall rapidly. He urged that the opposition be kept
going until then by the proposed infusion.
Mr. Johnson asked what was the optimum estimate.
Mr. Broe replied that if Allende should win a plebiscite and the op-
position loses out, then theres nothing left to support. On the other
hand, if Allende holds back from a plebiscite or loses in the vote, then
there will be an opposition to face in the 1973 congressional elections.
We believe he will go for a plebiscite.
3
In his November 22 memorandum, Broe stated: my point was that I was not
saying that unless we were going all the way in our support we should not support the
immediate proposal for [dollar amount not declassified]. What I attempted to state was that
the opposition needed the immediate proposed funds to get their organizations going.
Broe added also that the United States needed to support them over the long run.
(Ibid.)
378-376/428-S/80023
720 Foreign Relations, 19691976, Volume XXI
Mr. Kissinger asked whether Allende can hold a plebiscite legally.
Mr. Broe said he thought so but would have to check. Mr. Nach-
manoff also thought the plebiscite was legal. (Later checking has
proved Messrs. Broe and Nachmanoff to be correct.)
Mr. Mitchell asked for the rationale for the distribution of funds
among the parties.
Mr. Broe stated that this was based on the size of the constituencies.
4
Mr. Mitchell asked if Mr. Frei was actually able to raise funds in
Europe.
Mr. Broe: Yes, there is a regular flow from Europe to the PDC orga-
nizations. Former President Frei has been promised [dollar amount not
declassified] if he could raise an equal amount at home.
5
Mr. Johnson: Where is the CDU money from, primarily [less than 1
line not declassified]?
Mr. Broe: Not all.
Mr. Mitchell asked about the urgency.
Mr. Broe: Theyre hurting right now.
Mr. Packard: Wont this increase our visibility?
Mr. Broe: No, it will be fed in slowly.
Mr. Mitchell: What ever happened to El Mercurio?
Mr. Broe: Its still going.
Mr. Karamessines: Not any thanks to Agustin Edwards; he did
very little in Chicago.
Mr. Kissinger: Isnt he Kendalls man? Why dont you tell me if
you need something from Kendall.
Mr. Mitchell: I would still like to know what happened to the last
[dollar amount not declassified] and what the prospects are in regard to
the plebiscite.
Mr. Broe provided a detailed rundown of the allocated funds and
what the expenses were for.
Mr. Johnson: I am extremely skeptical of programs of this magni-
tude. If you have to provide such huge subsidies I cannot be sanguine
about the viability of any opposition which has to be primed to that
extent.
4
In his November 22 memorandum, Broe gave reasons and actual sizes of the
constituencies: the PDC had 26 percent of the vote and support of women, students,
peasants, and workers (the targets of the UP); the PNhad 13 percent of the vote and was a
middle class party supported by the wealthy business class. (Ibid.)
5
Broe reiterated in his November 22 memorandum that little or no money had been
raised by Frei in Europe. (Ibid.)
378-376/428-S/80023
November 5, 1970December 31, 1972 721
Mr. Kissinger: But the Allende purpose is to destroy the viability of
the opposition. This is not a normal situation here.
Mr. Johnson: Well, I will not oppose if the others agree.
Mr. Packard: We cant tell how much good it will do, but we have
no other alternative. You cant beat something with nothing.
General Knowles: It is worth the gamble.
Mr. Kissinger: This will keep the opposition viable. We can have
another crack at specifics later.
Mr. Mitchell: I still want to know what happened to the last [dollar
amount not declassified]. Even the Republicans dont spend money like
that.
Mr. Broe continued with a rundown of earlier expenditures.
The principals agreed to proceed on the basis of the proposal and
approved the requested sum of [dollar amount not declassified]. They
asked for progress reports every 60 days or earlier if advisable.
[Omitted here is discussion unrelated to Chile.]
Peter Jessup
272. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, November 15, 1971.
SUBJECT
My Conversation with Former Chilean Defense Minister Sergio Ossa11/15/71
I met this afternoon with Sergio Ossa, former Minister of Defense
in the Frei Government, [1 lines not declassified].
The gist of Ossas presentation was to express appreciation for the
support received, and to emphasize that the PDC was determined to
keep up the fight, that it was more united than ever before, and that co-
operation with the other opposition elements was much improved. He
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Secret; Sensitive; Eyes Only; Completely
Outside System. Sent for information. Kissinger and Haig initialed the memorandum at
the top of the first page.
378-376/428-S/80023
722 Foreign Relations, 19691976, Volume XXI
stressed the importance of developing the organizational capabilities of
the opposition parties, and maintaining opposition media outlets. He
also noted that, from the outside it might appear that the opposition
parties inability to raise their own funds or develop their capabilities
was a function of inefficiency rather than political pressure, but that in
fact there were very real and heavy political pressures. The implication,
of course, was that continued external support was critical and should
not be conditioned upon unrealistic expectations of what the parties
themselves might be able to do internally.
With regard to the general outlook for Chile, Ossa made the fol-
lowing comments:
The Constitutional Reform Amendment which Allende has just
submitted to the Congress is a masterful stroke, since it is a more mod-
erate position than previously advocated by Allende on the establish-
ment of a unicameral legislature, and it is combined with other popular
features.
2
In essence, Allende is taking a popular position by advo-
cating that he only wishes to speed up the legislative process, and that
he is not really trying to change the powers and prerogatives of the leg-
islature. Ossa noted, however, that the PDCs strategy would be to
avoid outright rejection of the amendment in the Congress, because
that would allow Allende to call a plebiscite as soon as possible. They
believe that by tying it up in the Congress, they can wait until the eco-
nomic situation deteriorates further before allowing Allende to hold a
plebiscite.
The economic situation is deteriorating rapidly, but in Ossas
view, this is not critical for Allende and the Marxists, whose primary
objective is to establish political control. He is not sure, however, that
Allende really understands very well what is happening to the eco-
nomic situation in Chile.
Ossa believes Allende will try to use a confrontation with the US
over copper compensation to rally popular support prior to the plebi-
scite. He will try to use the external confrontation to win his internal
struggle for political control. Ossa urged, as Frei has done, that the US
try to avoid giving Allende this issue by openly confronting him. He
recognized that Allende could choose the time and circumstances of
the confrontation, and that the US has legal and political requirements
which limit its flexibility, but he felt that it was essential for the US to
try to quietly ride out the copper situation. Otherwise, he said, every-
thing we are doing will be useless.
2
The constitutional amendment that Allende submitted to Congress on November
11 proposed a unicameral Peoples Assembly, the extension of social security to all
Chileans, several other popular welfare measures, and term limits for Supreme Court jus-
tices. (Juan de Onis, Allende Pushes Peoples Assembly Plan and Talks with Castro,
New York Times, November 12, 1971, p. 12)
378-376/428-S/80023
November 5, 1970December 31, 1972 723
If Allende loses the plebiscite, he will probably not resign as
would be the normal custom. Moreover, Ossa thought if some of the
UP parties believed they would not be able to retain political control
(e.g., losing the plebiscite with no prospect of winning the 1973 Con-
gressional elections), they would be prepared for civil war.
The basically apolitical position of the armed forces has not
changed significantly since Allendes election. He thought the military
would act only if a major breach of the Constitution occurred. How-
ever, he noted that among middle and junior grade officers, there was
some dissatisfaction with the generals for not playing a stronger role.
Ossa asked me to convey to you his appreciation for our support,
and to convey to you also the determination of the PDC leadership to
continue to fight for the maintenance of democracy in Chile.
273. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, November 16, 1971.
SUBJECT
Chile
Attached at Tab A
2
for your information is a speculative paper pre-
pared by the Office of National Estimates on the implications of a con-
frontation with Chile over the copper issue. In an informal discussion I
asked some of the ONE analysts to question the conventional wisdom
that a tough US reaction to the copper expropriation would inevitably
strengthen Allendes domestic position and gain support for him in the
Hemisphere. I asked, for example, whether a decisive reaction from the
US might not, in fact, provoke opposition elements to move against Al-
lende, and whether it might lead other Latin American governments to
disassociate themselves from the extreme Chilean position to avoid
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Secret. Sent for information. Written on the
in an unknown hand at the top of the page is HAK has seen.
2
Tab A is Document 90 in Foreign Relations, 19691976, vol. E16, Documents on
Chile, 19691973.
378-376/428-S/80023
724 Foreign Relations, 19691976, Volume XXI
being tarred with the same brush and thereby risk reduced foreign in-
vestment and aid.
The conclusion of the ONE paperwhich has not been distributed
to anyone elseis that given the climate of opinion prevailing in Chile
and in Latin America as a whole, US actions of retaliation for Chiles re-
fusal to provide prompt, adequate and effective compensation to the
mining companies would probably fortify Allendes political position
at home and engender considerable sympathy abroad. I think it is
worth your while to read the attached paper as background for SRG
consideration of a Next Steps paper which the Ad Hoc Working
Group on Chile is now preparing.
3
3
See ibid., Document 92.
274. Memorandum From the Assistant Secretary of the Treasury
for International Affairs (Petty) to Secretary of the Treasury
Connally
1
Washington, November 23, 1971.
SUBJECT
Chile
(1) The Chilean Government has now declared publicly its inten-
tion to renegotiate its foreign debt.
2
We have not yet been asked di-
rectly by them to participate, although informal feelers have been re-
ceived through our Embassy, which indicate they wish to negotiate
bilaterally with us and multilaterally with others. However, we have
been asked by the French Government, if we would be willing to attend
a general creditors meeting in Paris at the end of November, chaired
by them. (France has played a similar role in many debt negotiations
1
Source: Washington National Records Center, RG 56, Secretarys Memos, 1971:
FRC 74 A 17, Memos to Secy 1112/71. Confidential. Hennessy signed the memorandum
for Petty on November 24.
2
On November 9, Allende announced that Chile would seek renegotiation of for-
eign debts totaling more than $3 billion. (Juan de Onis, Chile, Reserves Low, Will Seek
Renegotiation of Payments on Her $3-Billion Foreign Debt, New York Times, November
10, 1971, p. 12)
378-376/428-S/80023
November 5, 1970December 31, 1972 725
before.) We have told them that any such meeting seems premature at
this time for our participation.
(2) There has been no basic change in the situation of the U.S. firms
in Chile. All three copper companies have filed appeals before the spe-
cial tribunal and are expected to complete their briefs within another
ten days. The operations of ITT Chile have been taken over and no ne-
gotiations are now in progress. The remaining, untouched U.S. firms
(book value $175 million) have not had any change in status.
(3) The economic situation in Chile, particularly the foreign reserve
level, has become worse in recent months, and this is why they want to
stretch out their debt (see attached debt profile).
3
It is believed that the
weakening economic situation and its adverse political impact has
caused Allende to present to Congress a plan for a unicameral legisla-
ture, increased Presidential powers and a weakened Supreme Court.
This may cause a political showdown for Allende since there is opposi-
tion to these moves by both political parties and large segments of the
population. He may welcome a U.S. showdown at this time to bolster
his hand for a plebiscite to gain approval of the internal measures.
(4) The Next Step
There has been no U.S. response except for two public statements
of concern on October 13 and 15 by Secretary Rogers and Assistant Sec-
retary Meyer.
4
Disbursement of the remaining undisbursed obligations
of approximately $25 million continues, which includes project loans,
food grants to voluntary agencies, technical assistance, and military
credits. If the Cannon Amendment to the aid bill presently pending in
conference is approved, it would stop all existing and new bilateral
aid and probably any new multilateral assistance (our lawyers
interpretation).
Recommendations on the next steps to be taken by the U.S. Govern-
ment will be going forward to the NSC shortly and ultimately to the President.
ATreasury position is needed now. Given the present situation, we rec-
ommend that as a general strategy we continue to apply economic
pressure and make it clear that the U.S. will not provide economic ben-
efits to Chile if it does not compensate. We would withhold strong re-
taliatory actions until the appeals process has proceeded further and it
is clear that compensation will not be paid.
There are three major options on the debt rescheduling:
(a) Refuse outright to negotiate until they agree to pay all foreign
debt (copper company notes) and compensate for expropriated com-
3
Attached but not printed.
4
For Rogerss statement, see Document 266. Meyer testified before a subcommittee
of the House Foreign Affairs Committee. (Benjamin Welles, U.S. Tells Chile Seizures
Could Endanger Aid to Needy Countries, New York Times, October 16, 1971, p. 6)
378-376/428-S/80023
726 Foreign Relations, 19691976, Volume XXI
panies. We would not compromise any eventual agreement to rene-
gotiatebut rather make settlement of outstanding claims a pre-
condition for consideration of any renegotiation.
(b) Negotiate a debt renegotiation of short duration (stretch out of
the next year of debt service only) in return for agreement to compen-
sate. This would open door for Chiles being declared creditworthy
in international lending agencies and would allow Allende to consoli-
date economically (assuming he is willing to settle expropriation
which is very unlikely).
(c) Agree to renegotiate debt, but only multilaterally with other
creditors. Try to restrict stretch out to 2 years maximum with stringent
financial conditions (IMF agreements, etc) which Chile probably not
willing to accept.
We recommend (a) above, as it applies maximum pressure and
does not tie our hands to ultimately renegotiate. The first step would be
to refrain from sending any representative to the Paris meeting, if held
in November or early December. The following additional actions
should also be taken now by the United States.
(1) A U.S. expropriation statement made within the next two
weeks.
5
(2) Stopping existing pipeline of aid loans.
(3) Publicbut low keyinvocation of Hickenlooper (or Cannon)
on January 15, 1972if tangible progress towards compensation of the
copper companies and ITT not made by then. This would be six months
after the act of nationalization.
(4) Consider other retaliatory acts only after that, depending on
their response.
5
Nixons January 19, 1972, statement is printed in Public Papers: Nixon, 1972, pp.
3134.
378-376/428-S/80023
November 5, 1970December 31, 1972 727
275. Memorandum From the Assistant Secretary of the Treasury
for International Affairs (Petty) to Secretary of the Treasury
Connally
1
Washington, December 3, 1971.
SUBJECT
Tactics to Deal with Chilean Debt Negotiations Request
1. We should quietly increase our pressure on Chile. This is based
on a judgement that as external assistance dries up and copper prices
remain down, poor economic management at home will become in-
creasingly apparent. Time is on our side.
2. Allende may sense this. He has stopped paying his foreign debts
and he has asked for a rescheduling. There is probably something to the
view that an open confrontation with the U.S. could be used to his do-
mestic political advantage. A quiet international financial isolation
would expose him at his worst. Riots in Santiago on Wednesday
prompted partly by food shortagesgive signs of a deteriorating
situation.
3. The immediate objective is to make sure that the creditors (ex-
cluding Russia) do not step in and (a) agree to a rescheduling, (b) pro-
vide new credits, or both.
These steps should be followed:
a. Put a slow man on the Chilean aid desk. A few million of old
credits are still being disbursed and this can be brought to a virtual halt
without actually proclaiming it.
b. Commence bilateral contacts with other creditors. The purpose
would be to explain the U.S. position, slowly and carefully.
c. Early next year (February or March) the creditors could get to-
gether and talk things over.
4. Our position should appear reasonable, one deserving of
cooperation:
a. Chile has seized U.S. property and we need a prompt and rea-
sonable settlement.
b. In the meantime, new forms of assistance are out of the question.
c. Other creditors have too much at stake: a dangerous precedent
could be set if a borrower is permitted to declare a moratorium on its
own debt and thenwithout any economic programobtain a gen-
1
Source: Washington National Records Center, RG 56, Secretarys Memos, 1971:
FRC 74 A 17, Memos to Secy 1112/71. No classification marking. Drafted by E.J.
Gordon; cleared by Hennessy. A copy was sent to Walker. The December 3 memo-
randum was signed by Petty on December 4.
378-376/428-S/80023
728 Foreign Relations, 19691976, Volume XXI
erous rescheduling along with new funds. (Our action on Pakistan
weakens this argument somewhat.)
5. The Chileans have stopped payment on all foreign debts since
November 12 with the exception of those to the IFIs and short-term
commercial obligations. They have formally proposed, on November
29, a deferral of all the principal and interest falling due to the U.S.
during 19721974, to be repaid over thirteen years including a three
year grace period. These are extraordinary terms, far more generous
than the ones Chile received in 1965 when relations were very cordial.
6. A Chilean team is now visiting European creditors; France, Bel-
gium, Great Britain, Italy, and West Germany. France reports that Chile
has approached them about relief in a bilateral context but without
mentioning specific terms. France stated that they could only consider
relief if multilaterally negotiated and with an IMF approved stabiliza-
tion program. France remains interested in chairing multilateral cred-
itors conference early next year.
2
7. I believe that Treasury and not State should take charge of these
negotiations. That is a role we have not ordinarily played in the past.
There would be strong support from EXIM, OPIC, and possibly from
Agriculture for this position. It is a natural for the NAC which has
always had considerable jurisdiction in this area. In fact, Walter Sauer
of EXIM has written you a letter requesting an NAC meeting as soon as
possible. I will have some suggestions on procedure shortly.
8. We are collaborating with State on a report to the President now
which should be ready in the next few days but we may not agree.
2
Anotation in the right margin in an unknown hand reads, Traditionally they [the
French] take a tough position on rescheduling.
378-376/428-S/80023
November 5, 1970December 31, 1972 729
276. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, December 7, 1971, 2202Z.
6008. Subj: Chile: An Initial Assessment.
1. Summary: After seven weeks in Chile, I have been impressed
with changes occurring here in even so short a time. Politically Chile
seems to be experiencing increasing confrontation and polarization of
political forces. Sharpening economic crisis has stimulated a stronger
opposition, and may not have left even the military unaffected. Castro
has contributed to Chilean tensions and discontents. Apparently he
leaves Chile with the impression Allende is not rpt not gaining
ground.
2
As of this momentit is our impression too.
2. What then? Possibilities seem to be: A) the customary Chilean
miracle of transactionalism; B) emergence of an irreversible mo-
mentum in Chiles transformation to Socialist control under present
policies; C) a GOC shift toward the radical AltamiranoCastro line;
3
D) overt or discreet military intervention; and E) an opening by Al-
lende to the center. Politics seldom produce clear solutions, butif
anything has changed in the past weeks it may be a slight weakening of
the likelihood that the first two possibilities will characterize the year
ahead.
3. I hope in a subsequent cable to make a few policy recommenda-
tions.
4
End summary.
4. Sharpening economic crisis: We have reported shortages of
meat, other foodstuffs and consumer goodsand reasons for them.
This is more psychological fact than real inability of Chilean middle
class to go on living reasonably well. But these Chileans are not much
accustomed to privation. Future prospects add to the unease. Now
Chile has run out of foreign reserves. Moreover, unavailability of dollar
exchange for increasing range of imports is beginning to be reflected in
production dislocations, as component parts unavailable in some cases.
5. I am told food shortages became significant factor for first time
in October. To give a very subjective illustration of the recency and
speed of economic changes, I might report that Embassy econ staff pre-
pared excellent roundup of Allendes first year, which I read in outline.
1
Source: National Archives, RG 59, Central Files 197073, POL2 CHILE. Secret;
Priority; Exdis.
2
Fidel Castro visited Chile November 10December 4.
3
Carlos Altamirano was a leader of the Chilean Socialist Party in the early 1970s.
4
Document 279.
378-376/428-S/80023
730 Foreign Relations, 19691976, Volume XXI
By the time it was completed, typed and returned to my desk I think we
all agreed it needed revisionto reflect the oncoming pace of economic
difficulties. As for foreign exchange, various projections made here and
in Washington estimated a run-down of reserves to a level of about
$100 million at end of 1971. Chileans effectively ran out of reserves in
November, and debt renegotiation clearly came upon them faster than
they themselves were prepared for.
6. Widening opposition. Shortages of food and consumer goods
became the pretext for organizing the Womens March,
5
nightly sym-
phony for several days of banging empty pots in upper and middle
class neighborhoods, and constant opposition press barrage of criti-
cism. Private-sector meeting at Caupolican indoor stadium was im-
pressive. Private-sector leaders say that businessmen, opposition poli-
ticians, newsmen and even some labor people are beginning to talk,
and beginning to cooperate. Papelera fight has rallied and united
cash-rich Chileans in buying up stock of the newsprint company to
thwart a government takeover. Psychologically it has given belea-
guered upper-middle class an outlet for action. GOC may ultimately
do-in Papelera some other way, but opposition has exhilaration of its
momentary victory. Law school sit-in by anti-UP students has similar
emotional elements. Each car passing on that busy avenue toots its sup-
port if driver is with students, with Boeninger, and against destruction
of free university. Sit-in raised spirits, even if outcome of university
test-of-strength highly uncertain.
7. Christian Democrats have not only gone into more aggressive
opposition, but have also seized some tactical initiative. Albeit largely a
negotiating and maneuvering posture, decision to initiate impeach-
ment Toha is one example. Opposition bill on defining public, mixed
and private sectors is another. Strategies on budget, wage bill, union
elections, worker-owned enterprises, planned Dec 16 stadium rally, co-
operation with National Party on January by-elections are further ex-
amples. Growth of opposition sentiment in PDC parallels their de-
clining confidence in person and word of Allende. President has
expended much of his capital in this regardand it was an important
asset during year just past. (On other hand, we should not forget most
PDC leaders would still prefer to accommodate PDC interests with
those of GOC.)
8. Perhaps what is significant nowis growing conviction in opposi-
tion parties, private sector and others that opposition is possible. This
5
The December 2 so-called March of the Empty Pots was a demonstration orga-
nized by middle-class and wealthy conservative women to protest food shortages and
the visit of Fidel Castro. Left-wing protesters harassed the women by throwing stones at
them. (Juan de Onis, Womens Protest Quelled in Chile, New York Times, December 2,
1971, p. 1)
378-376/428-S/80023
November 5, 1970December 31, 1972 731
has replaced earlier mood of resignation with which business commu-
nity reacted to buy-outs, or politicians despaired of saving Chile.
9. Even more important, is increasing realization that opposition is
necessary. What govt is doing goes beyond transactionalism. UP objec-
tives are increasingly seen as incompatible, and as going beyond what
can be accepted. If opposition interests are to be protected, confronta-
tion may not be avoidable.
10. Military attitudes remain great ambiguous unknown of
Chilean politics. CAS and DATT reports of discontent and plotting in
the military services have been substantially greater during past two
months than before. I shall not attempt to summarize them here. Pic-
ture that emergesinsofar as we have any real knowledgeis still far
short of any imminent readiness for direct action. It has been galling to
military and civilians to have men in uniform tear-gassing women.
Some of the officers own women folk were in that parade protesting
shortages officers themselves have experienced. It is galling to have it
implied women are braver than theynot decisive to disciplined
menbut galling. On positive side from point of view military morale
was fact that assumption of command in state of emergency led to
calming of disorders. Pinochet apparently enjoys his role and success.
Each time Allende is obliged to call in military to cope with problem
there is subtle psychological enhancement of potential military pres-
tige. All these factors are operating at the margin, but it is significant
that military potential for playing a role in forthcoming months is
perhaps slightly increasing.
11. Violence. Over past weeks there has been some tendency
toward increasing resort to violence on part both UP and opposition.
Violence of past days is obviousand now subsiding. Persistent rural
violence centered in Cautin Province derives in part from resistance by
small farmers to land seizures. In the city, invasion of Moneda, dis-
turbance near Presidents residence and alleged attacks on automobiles
of senior government figures appear to have given Allende gov-
ernment a scare.
12. Castro. In its impact on Chilean domestic scene, Castro visit
does not seem to have helped Allende. He did not succeed in con-
vincing Chuquicamata miners to climb off wage demands, nor is there
much evidence that his appeals for unity of leftist forces in Chile had
great impact. Middle-class Chileans became more resentful as his inter-
minable visit progressed. His initial impeccable behavior deteriorated,
as he blatantly engaged in political campaigning in OHiggins and Col-
ihagua, deprecated Chilean press and parliamentary freedoms, at-
tacked Uruguay from Chile, and made other sallies into what Chileans
regard as their internal affairs. He was basely attacked by Chilean
rightist press, which seized on photograph of Castro dancing with
378-376/428-S/80023
732 Foreign Relations, 19691976, Volume XXI
Chilean aide-de-camp to insinuate homosexuality and general boor-
ishness. These attacks undoubtedly contributed to Castros disillusion-
ment with Chilean situation and his openly expressed skepticism that
Chilean revolution succeeding.
13. Castro made point of confirming Socialist-Communist belief
that without mass mobilization, revolution ultimately cannot be guar-
anteed. A successful effort at mobilization may need both foreign and
domestic devils. Effort to create latter could make impossibly difficult
attempt at transactional settlements with opposition, pushing Allende
and UP toward extremism. Extremist solution would also imply intimi-
dation of opposition. There are some indications UP is already, in lim-
ited way, trying to frighten some of its opponents into silence or acqui-
escence. However, we believe this is not yet general, overall policy line.
14. Both from CAS reports and Castros public comments, it is clear
The Commander left Chile with an impression of disarray. In gen-
eral, Chilean Government has not given appearance during past weeks
of great surefootedness and confidence. If it is Castros impression Al-
lende is not gaining ground, it is also oursas of this moment.
15. The months ahead. It is not our impression that Chile is yet on
brink of showdown. In fact, there is some reason to believe that new
opposition spirit could prove transitory. Moreover, Christmas is fast
approaching and Chileans are notorious for their attachment to
JanuaryFebruary holiday season. Living is easier in the summer time.
Nevertheless, there are ugly, unresolved issues ahead. Budget and an-
nual wage adjustments will be tug of war. It seems unlikely that Chu-
quicamata miners can be placated with modest gains. University plebi-
scite, if ultimately held, could produce serious government reverse
and, if not held, new crisis. By-elections present Allende with serious
test. Government reorganization bill, bill defining public mixed and
private sectors, threat of Toha impeachment and possible national pleb-
iscite loom in background. Local guessing remains that political and
economic crisis will come to a head sometime after JanuaryFebruary
holiday season and before local winter is over.
16. What then? Following seem to be main possibilities:
A. Transaction, compromise and a sort of patching up in tradi-
tional Chilean style. My colleagues continue to warn me that events
move slowly in Chile, or perhaps better said, Chileans have great
ability to rush to the brink, embrace each other and back off. With Rus-
sian and East European help, some debt relief imposed by the debtors
inability and unwillingness to pay, and with some breaks, Chile just
might be able to rock along for some time to come.
B. The taking-hold of the irreversible process of Socialization
under Communist tutelage. UP has operated on fundamental pre-
ceptthat one key to irreversible revolution is transformation of
378-376/428-S/80023
November 5, 1970December 31, 1972 733
Chilean economic structure to system of centralized state control. Re-
flecting on Allendes first year, Minister of Interior Toha observed that
while government had served one-sixth of its mandate, it had imple-
mented far more than one-sixth of its programs. Oppositions economic
base is fragile, and it is not difficult to conceive of successful under-
mining by financial starvation of remaining media outlets and the take-
over of remaining large opposition enterprises. They have already
come perilously close. Despite some heating of its rhetoric, Communist
Party still appears to favor this economic approach to its political
problem.
C. A shift in Allendes tactics to embrace the radical Altamirano
Castro line. This could be either gradual or sharp. As noted above,
while Castro came preaching unity and moderation, he left avowedly
more revolutionary than when he came. Castro must have had
heart-to-heart talk with Allende before he left. Apart from Castro, eco-
nomic and political trend of events is pushing Allende toward the hard
choice between his professed democratic constitutionalism and his
own continuing command of Chilean reality. It is becoming clearer
with the months that Altamirano and Lenin may be rightthat you
cant have revolution without a revolution. If Allende should make
choice for radicalism and repression, to use fear, Chilean military
will face crucial decision.
D. Military intervention. Conventional wisdom both here and in
Washington is that prospects of military intervention for foreseeable
future are extremely small. It is held that military will turn blind eye to
virtually any constitutional abuseand Allende is smart enough to
avoid abuse so flagrant as to force open that blind eye. Other possibility
is that public repudiation becomes so overwhelming, and discontent so
great, that military intervention is overwhelmingly invited. It is held
that military will wait for this public repudiation to become more clear
and more open than it is likely ever to be. I do not challenge foregoing
judgments, but I am not sure how far in the future they can be relied on
as rock-solid premises of U.S. policy. I note that there is considerable
variety in ways military might intervene, and behind-the-scenes pres-
sure on Allende or greater effective military participation in the gov-
erning process are also possibilities.
E. An opening to the center. As Chiles crisis deepens, it is not in-
conceivable that Allende might turn away from the radical solution of
the Altamirano Socialist, and move toward the center. This could take a
number of forms, including a simple backing-off by Allende from more
provocative and radical programs. In doing so, he might materially in-
crease his chances of splitting Christian Democrats in truly significant
waystill a major CommunistAllende goal. On Allendes other flank,
UP might suffer greatly intensified internal strainsalready evident in
378-376/428-S/80023
734 Foreign Relations, 19691976, Volume XXI
present situation. Widespread left-wing terrorism would become more
likely.
17. Politics seldom produce neat solutions. We may find that what
actually happens in Chile is a mixture of bits and pieces of all the alter-
natives discussed aboveand other alternatives not treated here. What
does seem to be happening is that Allendes present course is working
less well. If this trend continues, it will increase pressures on Allende to
move toward radical solutions or in other directions. Allendes deci-
sions may in turn sharpen the choices of his opposition and also of the
military. The tempo of Chiles experiment in the via pacifica seems to
be quickening. In light of this, U.S. policy makers may wish to consider
some thoughts I hope to present in a subsequent telegram.
Davis
277. Memorandum From the Assistant Secretary of the Treasury
for International Affairs (Petty) to Secretary of the Treasury
Connally
1
Washington, December 10, 1971.
SUBJECT
The U.S. Problem in Chile
If we are to avoid contagionother nations following the ex-
ample of Chilean seizuresindustrial nations should work to maintain
a consistent front on both expropriation and debt issues, with Chile
being a good case. (Algeria will be of similiar interest to the French.)
Much is at stake and a message from Heads of State to their finance
people to work as closely as possible on these issues with their other
trading partners would be helpful.
While each industrial nation will continue to follow what it be-
lieves to be its own economic self-interest, there is a common long run
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Confidential. A copy was sent to Volcker. In
a December 10 covering memorandumto Connally, Petty stated, You will recall that this
sprang from my dinner conversation with Dr. Kissinger. The idea is to make the point [re-
garding the threat of increased numbers of expropriations of foreign investments in de-
veloping world areas] at the summit meetingsbeginning in the Azoresthat we should
concert more on these matters, especially in the World Bank. (Ibid.)
378-376/428-S/80023
November 5, 1970December 31, 1972 735
stake among these countries in trying to contain economic nationalism
and in avoiding actions which undercut one another.
At present, in Chile U.S. companies, with values in excess of $1 bil-
lion, have been taken over with almost no prospects of adequate com-
pensation. Chile has now proposed that the U.S. and other G10 coun-
tries reschedule their foreign debt in a way in which we would receive
nothing in the next three years and a promise to pay over the following
ten years.
The G10 countries are scheduled to receive loan repayments from
Chile over the next few years, of roughly $100 million a year, compared
to $175 million for the U.S. There is over $60 billion in debt of devel-
oping nations owed to G10 countries and it could start a dangerous
trend if Chile, after just expropriating foreign investment is then per-
mitted to declare a moratorium on its own debt and, without any vis-
ible economic stabilization program, obtain a generous rescheduling.
The governments with whom you will be meeting have economic
relationships similar to ours with the developing countries of the
world. They are importers of raw materials and exporters of manufac-
tures, as well as direct investors and creditors. From time to time one or
another of the industrial nations has experienced a period of intense
friction with developing countries. Currently, everyones oil invest-
ments are under heavy pressure by producer countries. At different
times since the war, the British, French, Belgians, Dutch and U.S. have
suffered major expropriations of investments in less developed
countries.
378-376/428-S/80023
736 Foreign Relations, 19691976, Volume XXI
278. Memorandum From the Executive Secretary of the 40
Committee (Jessup) to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, December 13, 1971.
SUBJECT
Request for Funds for 16 January 1972 By-Elections in Chile
This is a 40 Committee proposal to provide [dollar amount not de-
classified] to support two good opposition candidates in a special elec-
tion in Chile for two vacant congressional seats. Both Nachmanoff and I
agree that this is in the current mold of doing what we can to keep Al-
lende off balance.
All the other principals are on board, so we recommend a tele-
phonic vote rather than a meeting.
2
In this connection, I am attaching a
note to you from Dave Packard dated 8 December (Tab B),
3
a sort of
swan song urging that the Committee keep after Chile. Packard has in-
dicated that he will not be in the approval process after 10 December
and has asked Laird what he would like to do in the interim. I think that
we can take the tone of his letter as an endorsement for what is
proposed.
There is a time factor in this proposalthe election taking place in
30 daysso I urge prompt attention to this matter.
4
The candidates we are backing, [name not declassified] the Christian
Democratic Party and [name not declassified] the National Party, are
solid citizens and their opposition are no pushovers [1 lines not declas-
sified]. The elections will be close.
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
19711972. Secret; Sensitive; Eyes Only; Out of System. Sent for action. Attached is a De-
cember 10 memorandum to the 40 Committee explaining the proposal in detail. It is Doc-
ument 93 in Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973. Also
attached is a December 14 memorandum from Jessup to Mitchell, in which Jessup as-
sumed his approval, but requested Mitchell to telephone with his decision.
2
On December 15, the 40 Committee approved the request by telephone. (Depart-
ment of State, Bureau of Intelligence and Research, INR/IL Historical Files, 40 Com-
mittee, JanJun 1972)
3
Attached at Tab B is a December 8 memorandum to Kissinger, in which Packard
urged that we seek to apply every available means to preserve the democratic system in
Chile and that the 40 Committee be alert to any opportunities or options that could fur-
ther assist our objectives in Chile.
4
Haig initialed approval for Kissinger on December 15.
378-376/428-S/80023
November 5, 1970December 31, 1972 737
279. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, December 14, 1971, 1600Z.
6082. Subject: Chile: USG Posture and Policy. Ref: Santiago 6008.
2
1. Summary: Developing Chilean economic and political crisis
argues for continued US policy of quiet restraintavoiding confronta-
tion, postponing issues and fuzzing actions. Opposition leaders are
unanimous in urging that we not give Allende pretext with which he
can rally his divided nation against foreign devil. In specific terms
such policy would recommend allowing Europeans take lead in debt
renegotiation while this slow and troublesome process works against
GOC. In copper and ITT our interests would best be served by permit-
ting appeals and negotiations to run their course as Allendes problems
mount.
2. On aid side, we can best pursue these ends by continuing
strategy of delay and unresponsiveness, while proceeding with rapid
phase-out of all but people-to-people programs. By next month pro-
grams will essentially be at level and wind-up which would exist if
Hickenlooper actually invoked on that date. Other than in symbolic
sense, Hickenlooper would only be important as it affects military
assistance. Here we believe it important to continue and possibly ex-
pand our modest programs as means of sustaining armed forces US
orientation and their potential as opposition power center. Strength-
ening of US informational and cultural activities might also be helpful
at this juncture. Finally, I hope that we will prepare ourselves for crit-
ical times ahead in intelligence capabilities and in personnel policies of
all agencies. End summary.
3. Policy recommendations made here are intended to lie in con-
text of analysis contained reftel (Chile: An Initial Assessment). What
seems clear to me and my colleagues is that: 1) Chiles fate is not yet a
foregone conclusion; and 2) the pace of decision and confrontation is
quickening. We may not have to wait too many months for Chilean po-
litical and economic crisis to come to some sort of head.
4. Newcomer is struck with compelling force of argument against
giving Allende flag and foreign devil against which to rally his di-
vided nation and consolidate his regime. Virtually without exception
opposition leadersbusinessmen, politicians and journalistshave
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Secret;
Priority; Exdis.
2
Document 276.
378-376/428-S/80023
738 Foreign Relations, 19691976, Volume XXI
taken occasion of their first contacts with me to plead for US policy of
close-mouthed restraint. Every month of US self-discipline could be
important.
5. It is difficult for great, open US democracy to maintain distinc-
tion between what we do and what we say. However, what Americans,
Europeans and others are doing is proving highly effective in hastening
Allendes economic crisis. Bankers and traders are doing what comes
naturally, and Chile is revealing itself as among worlds most unprom-
ising credit risks. Our policy of prudent and quiet patience has been
generally successful so far in depriving Chilean radicals of public, emo-
tional target they need.
6. This diagnosis argues for avoiding confrontation when we can,
side-stepping conspicuous retaliation, postponing issues, and fuzz-
ing our actions. On occasion we may be well advised to resist the
North American urge to tidy things up. In terms of specific issues, this
might mean something along following lines.
7. Debt renegotiation. Multilateral negotiation with Europeans in
the leadand US in the leewould seem to serve our purposes well.
Europeans are doing fine. IMF, IBRD, IDB and other international
agencies can carry much of the load. Hopefully we can avoid being
ones to turn down Dec. 20 Paris Club meeting.
3
Chileans are poorly or-
ganized, and there is little danger of their pushing pre-Christmas
meeting to any meaningful resulteven if Europeans should agree to
meet on that date. I assume we shall simply hear-out Inostroza, Letelier
and company when they come to Washington. Rather than pressing
either overtly or covertlyfor stringency of terms, we might do better
to take rather quiet role and let time and other actors work for us. Re-
ality is that Chileans havent the money to pay in any case, and no
amount of stamping on the turnip is going to change that fact. By
avoiding appearance of unreasonableness or disposition to public dis-
pute we can help make sure GOC bears burden of its foreign exchange
crisis and what will probably be, for GOC, a slow and unsatisfactory
renegotiation. Ideologically and for practical domestic political reasons
GOC will have great difficulty in accepting realistic reforms or
stand-by which IMF and Europeans will want.
8. Copper. While there are signs of a few second thoughts on Al-
lendes part over wisdom of his extreme finding, he doesnt have
money nor economic or political conditions which would permit ac-
ceptable solution at this moment. It is conceivable that there might be
time in future when some combination settlement involving payment
over number of years would be possible. Allendes political-economic
3
The Paris Club was a group of 14 creditor nations that negotiated rollovers, partial
postponements, and debt servicing for debtor nations.
378-376/428-S/80023
November 5, 1970December 31, 1972 739
crisis is not so far away, and it would seem both in interests USG and
copper companies not to force copper appeal to abortive conclusion in
next month or two.
9. ITT. Same goes for ITT. I am happy talks opening in US, but not
hopeful. Presumably ITT wants to be paid, and it is doubtful satisfac-
tory outcome is in the cards at this time. ITT has long resisted physical
appraisal, partly because of time required, but some passage of time in
properly safeguarded appraisal might serve ITTs interest.
10. Aid. We are rapidly phasing out aid programs. While we cur-
rently have theoretical aid loan pipe-line of approximately $17 million,
in fact we have already made decisions not to go forward with pro-
grams which represent over $13 million of that amount (San Vicente
port, bid no. 7 and local currency financing under education loan, cer-
tain feasibility studies, etc.). On grant side, excluding approximately
$8.5 million in Food for Peace commodities used mostly to feed school
children, our program during FY 71 ran at rate of about $1.5 million. By
end of FY 72 we will have reduced this by more than half and will be
left with grant activities limited to AIFLD scholarships to US, RTAC
books, special development activities, and technical support. Except for
school feeding, these programs neither ease GOCs foreign exchange
problem nor do they relieve GOCs economic crisis. They do, however,
enable USG to maintain constructive contact with varied elements of
Chilean population. Even school feeding can only marginally be re-
garded as substituting for imports which would otherwise be made,
and is being cut back in any case.
11. As for Hickenlooper, within a month aid programs will consist
essentially of same activities which would exist if Hickenlooper actu-
ally invoked on that date (wind-up under Section 617 of FAA, plus ac-
tivities mentioned above which might continue even if Hickenlooper
applied).
12. In our strategy, we have employed delay, inactivity, and unre-
sponsivenessand hope this strategy can be continued. For example,
de-obligation requires notice to GOC, and hopefully we can resist urge
to tidy-up, and simply leave obligated balances on books for a few
months for political reasons. Sums are not large, and no actual financial
cost would be involved. When GOC requests firm answers and clarifi-
cations from USG (or even multilateral institutions where we have in-
fluence), there is no reason we must comply. A thick skin may help us a
lot in months immediately ahead. (It is interesting that issues over
which President Allende flailed at us in his recent CUT speech were all
symbolic and highly public exchanges between two countriesand not
quietly terminated aid programs.)
13. Military. One of our broad policy objectives is to sustain poten-
tial opposition power centers here in Chile. Military establishment (in-
378-376/428-S/80023
740 Foreign Relations, 19691976, Volume XXI
cluding Carabineros) is among most important of these, if not the most
important. Therefore, it is worth considering seriously how we can but-
tress military independence and maintain our own ties with armed
forces. Military is trying to stave off reorientation of armed forces to So-
viet weapons, materiel and training despite heavy pressures. Without
some US help, military may not be able to sustain its position.
14. Other than its symbolic role, Hickenlooper is really important
to US policy only in its applicability to military assistance. In this re-
spect timing of copper appeals process may allow us to continue
modest military assistanceparticularly military assistance training
at least for a time. We should not underestimate effect of this program
on Chilean military attitudes. Their fear of abandonment continues
to be a critical psychological factor here. Funding should at least be
maintained at present level of $850,000 or preferably increased
perhaps to level last CAS Country Team submission ($1,250,000). We
should consider whether some small materiel gestures to Chilean mili-
tary are possible. Under present restrictions, only military service we
are in position to assist is Chilean Navy, through US Navys ship lease
program. We shall soon be submitting proposal for leasing one ag-
ing, noncombatant shipuseful principally for its symbolic value to
Chilean Navy as evidence of our continuing cooperation. It would also
be worth considering whether we could restore Chiles eligibility for
MIMEX, SIMEX, MAPEX and PAMEX items. Chiles removal from eli-
gibility in 1968 was based on economic conditions here which no longer
prevail. Some flexibility in providing materiel would strengthen our
hand in trying to ensure continued reliance on the US for military sup-
port. My understanding is that FY 72 Foreign Military Sales credit is
planned at $5 million level. This figure should be maintained and, if
possible, somewhat increased. We understand intensity of US domestic
pressures and difficulty of maintaining and defending military assist-
ance to Chile. Nevertheless, in terms of our own real interests in this
country, the stakes are high.
15. Information and exchanges. With phasing out of aid, departure
of most US business, and other reduction of ties, our information and
cultural presence takes on increasing relative importance. In these
terms Chile becomes more like Eastern European countries where we
have long recognized high priority in information and cultural field.
Recent Duke Ellington visit was of disproportionate cultural and polit-
ical significance here. Other high quality cultural presentations, intel-
lectual exchanges (e.g. Paul Nash), exhibits (we should consider
UNCTAD III), continued budgetary support for educational exchanges
and our bi-national centers, good 35 mm color shorts and TV series
dubbed in Spanish, and sophisticated placement of quality materials
with newspapers and radio, are among important elements of effective
public affairs program.
378-376/428-S/80023
November 5, 1970December 31, 1972 741
16. Internal administration. In some ways we are in a time of prep-
aration for tests ahead. In our intelligence collection effort, if we need
people or sophisticated equipment for programs deemed of high pri-
ority, we had better not too long delay in implementing our plans. Not
only may time come when we need to be well prepared, but introduc-
tion of men and materiel may become increasingly difficult. In period
ahead this Mission must more than ever have its contacts out. In our
personnel programs, I hope all agencies will give Chile sufficient pri-
ority to assign top-flight personnel, with substantive and language
preparation, to enable us to do best job possible with as few people as
are necessary.
Davis
280. Memorandum From Robert Hormats and Arnold
Nachmanoff of the National Security Council Staff to the
Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, December 21, 1971.
SUBJECT
ChileDebt Rescheduling
State (Tab A)
2
has written to inform you that, consistent with the
unanimous views of the interested USG agencies, it wishes to inform
Chile and the other creditor nations that we will participate in a negoti-
ation for the rescheduling of Chilean debts. The French, Germans, and
other Europeans are prepared to participate but have told the Chileans
they would do so only in a multilateral framework which includes the
U.S.
In the discussions, the U.S. will pursue several objectives:
To deny Allende a pretext for rallying an increasingly divided
Chile against the U.S. as a foreign scapegoat;
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VI. Secret. Sent for action. Haig initialed the
memorandum.
2
Attached but not printed at Tab A is a December 17 memorandum from Eliot to
Kissinger. (Ibid.)
378-376/428-S/80023
742 Foreign Relations, 19691976, Volume XXI
To insure that the Chilean Government receives the minimum
possible relief from its economic problems;
To protect the large exposure of the Export-Import Bank and the
Overseas Private Investment Corporation, and to use maximum fea-
sible leverage on behalf of the expropriated U.S. copper companies.
There are additional remaining issues to be resolved before the
U.S. position in these negotiations is determined, and an options paper
on these issues will be submitted to the SRG next week.
3
For the mo-
ment, however, we believe that informing Chile and the other creditors
that we will participate in a multilateral rescheduling exercise, while
committing us to nothing, avoids the possibility of Chile singling us out
as being the only country opposed to participation in such an exercise.
State, accordingly, wishes to inform Chile as soon as possible, but is
anxious to have your approval before doing so.
Recommendations
That you approve USG participation in a multilateral negotiation
for the rescheduling of Chilean debts.
4
3
The paper was submitted on January 12, 1972. See Document 286.
4
Kissinger initialed the Approve option. The first Paris Club meeting on Chilean
debt was on February 17.
281. Memorandum From the Under Secretary of State (Irwin) to
the Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, December 22, 1971.
SUBJECT
Considerations Affecting Next Steps Options for Chile
NSDM 93
2
established the following basic policy objectives in our
relations with Chile: to prevent the consolidation of the Allende regime
and to limit the ability of the Allende regime to carry out policies con-
trary to U.S. and hemisphere interests. To achieve these objectives,
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H220, NSDM 93. Secret; Sensitive; Nodis.
2
Document 175.
378-376/428-S/80023
November 5, 1970December 31, 1972 743
NSDM 93 calls for maximizing pressure on the Allende government
while maintaining a correct but cool public posture. Thus pressure is to
be balanced by a restrained public posture so that measures intended to
weaken the Allende regime do not contribute to its consolidation of
power or its ability to rally external support.
Although the process of appeal to a Special Tribunal remains to be
concluded, there appears to be little prospect that the Allende regime
will provide any significant compensation for the equity interests in the
major U.S. copper properties expropriated by Chile in July, 1971. Thus,
some form of a confrontation seems unavoidable. It remains to be de-
termined how a confrontation would come about and how far it would
go.
The Allende government is in considerable internal difficulty. Na-
tionalization and other economic policies have been costly. Production
and food shortages, labor indiscipline, an inflation rate of about 20 per-
cent despite rigid price controls, sharply depleted reserves and sagging
copper prices are creating increasing political as well as economic diffi-
culties. The violence and repressive measures set off by the December 1
womens march protesting food shortages are evidences of growing
popular discontent.
While President Allendes personal popularity is still considerable
there are signs it is declining. Government candidates lost in a series of
recent labor union and university elections, as well as in the July 1971
by-election for a deputy in Valparaiso, the nations second largest
urban center.
Allende could use a foreign scapegoat to take Chileans minds off
their internal problems and to rally them to his side. The question is not
whether in our actions toward Chile we take a hard line or a soft
line but rather whether we take the necessary measures quietly or con-
tribute to a strident confrontation.
Our basic position on the copper compensation issue in Chile al-
ready has been stated publicly by Secretary Rogers.
3
A broader state-
ment of our position on expropriation in general will publicly establish
what we need to say on this issue without singling out the Chilean
situation.
Our efforts to keep the onus for our worsening relations on Al-
lende have proven reasonably successful to date and have been so ac-
knowledged by our friends in Chile and elsewhere in the world. The
unvarying advice we continue to receive from Allendes opponents
and those who wish us well is to continue to avoid playing into Al-
lendes hands.
3
See Document 266.
378-376/428-S/80023
744 Foreign Relations, 19691976, Volume XXI
The advantages of not giving Allende gratuitous alibis to explain
away his own bad performance outweigh, in our judgment, any pos-
sible risk involved via the model effect of such a policy on other
countries. We would in any case undertake to explain our strategy to
other countries, where appropriate, making clear that our actions, far
from reflecting indifference to or acquiescence in Chilean policies ad-
verse to our interests, are designed to maintain pressures while mini-
mizing Allendes opportunities to exploit those pressures.
It has been our assessment during the past year that while our eco-
nomic pressures can exacerbate the difficulties of the Chilean economy,
the present downward course of the Chilean economy is so well de-
fined that the economic pressures available to us will add only mar-
ginally to its deterioration. The element in doubt here is not what will
happen but rather who will be blamed.
Any assessment of the effectiveness of economic sanctions against
Chile should also take into account the vulnerability of the $1.4 billion
which represents Chiles debt to the U.S., plus the OPIC exposure plus
the remaining uninsured U.S. private investment in that country,
which in a real sense are hostage against our actions. In this respect, it
may be noted that negotiations are continuing with IT&T, and that the
GOC continues to maintain the position that it will pay the debts of the
mixed copper companies to third parties.
As regards our policies before international lending institutions,
we should seek to obstruct and delay Chilean loan applications before
the IBRD and IDB using technical and procedural reasons to the max-
imum feasible extent. Our objective would be to avoid as long as we
could an unnecessary confrontation, the likely adverse repercussions
stemming from Chilean charges of U.S. economic retaliation, and the
negative effects on our other financial interests and on our relations
with the multilateral institutions. It is quite conceivable, however, that
after having exhausted available delaying tactics, we may have to face
up to this dilemma. Should the issue then be posed in stark terms of
voting for or against a loan to Chile, we would vote against loans.
The course of action which best corresponds to the guidelines es-
tablished by NSDM 93 is to allow the dynamics of Chiles economic
failures to achieve their full effect while contributing to their mo-
mentum in ways which do not permit the onus to fall upon us. Provoc-
ative actions or visible harassments on our part would only insure that
we receive the blame for a confrontation and offer Allende the opportu-
nity to shift to us the responsibility for his economic failures. In such
circumstances, we also would run the serious risk of pushing Allende
into closer Soviet relations and possibly large-scale economic and mili-
tary assistance. With regard to the latter contingency, we share the De-
378-376/428-S/80023
November 5, 1970December 31, 1972 745
fense Departments concern for retaining our traditionally close and
friendly relations with the Chilean military.
Though hard pressed, the basic elements of democratic choice in
Chile are still intact. The outcome of the political struggle in Chile is
still uncertain and Allendes revolution has not reached the point of ir-
reversibility. We should therefore avoid, as best we can, prejudicing the
survival of democratic alternatives in Chile.
We believe that selective suspension of assistance to Chile, without
a formal invocation of the Hickenlooper amendment (so long as plau-
sible grounds can be found to avoid the application of the amendment)
and with the exact timing of our actions to be left flexible, would best
serve the basic policy objectives indicated above while also defending
the principle of just compensation for expropriated property. We there-
fore recommend the adoption of timing option Y and the following mix
of key points from options C and D (see paper entitled CHILE: Next
Steps dated November 23, 1971):
4
Continue military assistance and people-to-people activities.
Continue to withhold new AID or ExIm Bank loans. Continue
suspension of ExIm loan disbursements, guarantees and insurance op-
erations as made effective by the Bank on December 6.
Slowdown AID loan pipeline disbursements. (We could eventu-
ally deobligate funds whenever plausible technical grounds can be
used, but since this would require formal notice we suggest holding off
on actual deobligation for the time being.)
Delay and discourage consideration of loans to Chile in the IDB
and IBRD; as necessary vote against them in both institutions.
Adetailed paper on the issue of debt renegotiation is in the process
of preparation on an interagency basis and will be forwarded to you
shortly.
5
John N. Irwin II
4
See Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 92.
5
Attachment to Document 286.
378-376/428-S/80023
746 Foreign Relations, 19691976, Volume XXI
282. Memorandum From Acting Secretary of the Treasury Volcker
to the Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, December 23, 1971.
SUBJECT
Chile
Secretary Connally believes it would be useful to sort out as soon
as possible the various financial issues involved with the proposed
renegotiation of the Chilean foreign debt to the United States.
On November 12, the Chileans stopped payment on their debt and
have approached us for a stretch-out of the next three years debt serv-
ice over thirteen years. Other creditor nations, which have also been ap-
proached, do not have an expropriation problem with Chile and have
tentatively agreed to renegotiate in the Paris Club under the chairman-
ship of France, now scheduled to meet at the end of January.
A U.S. Government position on renegotiation is needed in order
to advise the other creditors and to serve as the basis for the next Na-
tional Advisory Council (NAC) report on foreign debt arrearages to
Congress. In order to facilitate the sorting out of the various financial
issues, I have asked that an NAC Alternates level (Assistant Secre-
taries) meeting be convened to discuss the financial aspects of renegoti-
ation, focusing inter alia on those issues listed below. This will be
closely coordinated with the NSC.
Issues
(1) What economic and financial pre-conditions for renegotiation
should we discuss with other creditors?
(2) Should an IMF standby agreement be a part of any stretch-out?
(3) What should the U.S. Government position be on the make-up
of the debt to be rescheduled. Should it be all public, public without in-
ternational financial institutions, or public plus guaranteed private
debt (including copper notes)?
(4) Assuming a renegotiation takes place, what formula for di-
viding up the rescheduled debt among USG creditor agencies should
be used? What are the terms and conditions we would insist on?
Paul A. Volcker
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H220, NSDM 93. Confidential.
378-376/428-S/80023
November 5, 1970December 31, 1972 747
283. Memorandum From Arnold Nachmanoff of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, December 29, 1971.
SUBJECT
Chile
Secretary Laird has written a letter to you (Tab B)
2
referring to a
message from Ambassador Davis (Tab C)
3
on policy toward Chile. (We
briefed Davis message for you on December 16.) Secretary Laird refers
to a previous letter to you from Deputy Secretary Packard (Tab D)
4
and
particularly calls attention to paragraph 16 of Davis cable, which sug-
gests that if we need top flight people or sophisticated equipment for
programs deemed of high priority we had better not long delay in im-
plementing our plans. Not only may time come when we need to be
well prepared, but introduction of men and materiel may become in-
creasingly difficult.
In his letter, Packard noted that increasing dissent in Chile may
provide us with new opportunities for both overt and covert action,
and suggested that the 40 Committee be alert to any opportunities or
options that could further our objectives. Secretary Laird, however, rec-
ommends that the 40 Committee undertake as a matter of top priority
the preparation of an action plan with special attention to the Ambas-
sadors recommendations for both overt and covert courses of action.
Coincidently, Admiral Zumwalt called General Haig last week to
draw his attention to the same paragraph in Ambassador Davis cable.
As you know, the SRG and 40 Committee have maintained a con-
tinuous review of our policies and programs with regard to Chile. The
ad hoc Group has prepared a Next Steps Options Paper on the copper
situation for SRGconsideration,
5
and expects shortly to have an options
paper with regard to Chilean debt rescheduling.
6
These will be circu-
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172. Secret; Sensitive; Eyes Only. Sent for action.
2
Attached but not printed at Tab B is a December 23 letter from Laird to Kissinger,
reiterating Packards view that we be alert to any opportunities or options that could
further our objectives in Chile.
3
Tab C is Document 279.
4
For Tab D, see footnote 3, Document 278.
5
Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 92.
6
See Document 286.
378-376/428-S/80023
748 Foreign Relations, 19691976, Volume XXI
lated to the SRG members and agency views on the options will be so-
licited, as soon as the debt rescheduling paper is available. We can then
decide whether to staff these issues to the President or hold a SRG
meetingwhich may not be necessary if there is little agency disagree-
ment. You will recall, of course, that the 40 Committee has had Chile
under consideration quite recently.
Neither Laird nor Packards letter offers any specific recommenda-
tions. Paragraph 16 of the Davis cable is similarly a general plea that the
agencies assign top-flight people and sophisticated equipment so that
we can be prepared for the tests ahead. Obviously, if someone has
specific recommendations for action, the SRG or 40 Committee, as ap-
propriate, should consider them.
I suggest that you thank Laird for his letter, note that the SRG and
40 Committee are keeping continuing watch over Chile policy in ac-
cordance with NSDM 93, and suggest that any specific proposals
would be given prompt and full consideration by the appropriate com-
mittee. A suggested reply to Laird is at Tab A.
7
Recommendation
That you sign the reply to Laird at Tab A.
7
Attached but not printed at Tab A is a January 5, 1972, draft letter from Kissinger
to Laird that states that any specific proposals [on U.S.-Chile policy] which are made
will be given prompt and full consideration.
284. Telegram From the Department of State to the Embassy in
Chile
1
Washington, January 6, 1972.
4069. Subject: Chile Copper/Debt Rescheduling. Ref: State 1716.
2
1. After Jan. 5 meeting at which Ambassador Letelier was advised
of USG decision to participate in multilateral debt renegotiation (reftel),
Letelier was told informally by DeptOff that USG decision to partici-
pate was taken before announcement of GOC action suspending pay-
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Se-
cret; Priority; Exdis. Drafted by Feldman; cleared by Hunt, Weintraub, Fisher, and Holly;
and approved by Crimmins.
2
Telegram 1716 was not found.
378-376/428-S/80023
November 5, 1970December 31, 1972 749
ment on OPIC-insured Braden notes;
3
that this was fortunate since
GOC action had caused strong reaction in Washington.
2. You are requested to seek an appointment with Allende ASAP
to express USG concern over recent actions taken by GOC on the
copper front. You may cite USG decision to participate in Paris talks as
concrete evidence of continuing US interest in maintaining normal rela-
tions between our two governments and reiterate our desire to find a
pragmatic basis for living with the serious problems that divide us con-
sistent with the interests of each side. Allende is well aware of the
USGs disappointment over his excess profits determination, as re-
flected in the statement made by the Secretary of State. However, we
recognize that the GOC compensation process is not completed and
that a reasonable solution might yet be found. Further, we had taken
note of the repeated public statements by the President that Chile will
honor the obligations of the mixed mining companies assumed by the
state by virtue of the nationalization. We had also noted with interest
the Presidents private statement to Ambassador Korry indicating that
payment of the Codelco notes to Anaconda, might be accomplished
through litigation brought in foreign courts, (Santiago 5189)
4
and we
understand that the President had led the executives of Kennecott to
believe that the El Teniente notes to Braden would be paid. (State
196895)
5
3. The USG however is concerned that the recent actions taken by
the GOC suspending payment of both the Anaconda and Braden notes
represent a further movement away from a reasonable settlement.
There appears to us a great risk that these recent actions will further tie
the Presidents hands in working out an understanding with the US on
the copper question, if that is his objective. The US position, which has
been expressed to the GOC numerous times, has not changed. We
cannot accept the repudiation of solemn international financial com-
mitments. The Anaconda notes are a direct obligation of a GOC agency,
and the Braden notes are unconditionally guaranteed by the Republic
of Chile.
4. You should ask the President the following questions:
(a) Recognizing that the constitutional amendment does not re-
quire that any debt of the mixed mining companies be repudiated,
what is the Presidents intention with respect to the Braden notes? Has
he changed his mind concerning their payment? In this connection, you
should note that the views of Codelco on the expansion program at El
3
See Document 239.
4
Dated October 11, 1971. (National Archives, RG 59, Central Files 197073, INCO
152 CHILE)
5
Dated October 27, 1971. (Ibid.)
378-376/428-S/80023
750 Foreign Relations, 19691976, Volume XXI
Teniente are a matter of public record, as is the fact that the Contraloria
took a more objective view of these matters. You should also make it
clear to him that international law would not support, and the US
cannot accept, the repudiation of international obligations incurred by
a state on the basis of a subsequent unilateral judgment by the debtor
state that the funds received from foreign creditors were not usefully
invested. In the case of El Teniente, this contention is particularly
hollow inasmuch as the loans were made to a mixed mining company
51% owned by the GOC and the investments were approved by the
Board of Directors including its Chilean majority.
(b) How does the GOC justify suspending payments to Braden
while it continues to permit payment to other creditors who made
funds available for the expansion of El Teniente? Isnt this action
discriminatory?
(c) Para 7 of Decree 124 appears to question the payment of the
other creditors of the mixed mining companies.
6
It had been our under-
standing based on numerous statements by the GOC in Santiago and
Washington that these debts had been assumed by the GOC by virtue
of the nationalization amendment and would be paid. For example,
MinFin Zorillas in August 4 letter to Exim Pres. Kearns stated GOC in-
tended fulfill Exim copper expansion loan obligations and obligations
to all sources of international financing.
7
Does this decree mean that
the creditors will have to await a formal determination by the President
in order to be sure that these debts will be respected? If so, when would
the President expect to make these determinations?
(d) The GOC has asked the Tribunal to declare void the provision
of the Codelco notes to Anaconda providing for application of New
York law. Does this mean that the President has reconsidered his
thoughts previously expressed to Ambassador Korry in this regard?
5. In the course of this discussion you should reiterate to Allende
the desirability of retaining maximum flexibility for reaching a solution
to this problem and invite him to consider with us the possibilities for a
pragmatic solution. You should also point out, unless the course of con-
versation makes it clearly inappropriate, that the US looks forward to
constructive discussion of these debt questions with the GOC during
the process of debt renegotiation soon to begin in Paris.
Irwin
6
This decree deferred payments due on both the Anaconda and Braden promissory
notes.
7
Letelier also made this point in his August 5, 1971, meeting with Kissinger and
Nachmanoff. See Document 242.
378-376/428-S/80023
November 5, 1970December 31, 1972 751
285. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, January 11, 1972, 2235Z.
162. Subject: Chile Copper/Debt Rescheduling. Ref: State 004069.
2
1. Summary: As instructed, I called on Pres Allende and expressed
most serious concern of USG at recent Chilean actions suspending pay-
ment Anaconda and Braden notes. Allende said he respected Ana-
condas full right of appeal to US courts. If Anaconda should win its
case, he presumed some international tribunal would have to decide
between Chilean and US jurisdictions. Re Kennecott, Allende said he
was appointing committee of Chilean and Finnish experts to advise on
investment utilization. He alleged that it was not his desire that deter-
mination be punitive or excessive. Re other creditors, Allende said
GOC intended to respect obligations. I advised Allende that US looks
forward to constructive discussion copper debt questions in Paris. End
summary.
2. Pres Allende received me privately at his Tomas Moro residence
at noon today. Telling the President I was speaking under instructions,
I noted that recent GOC actions suspending payments of Anaconda
and Braden notes had caused strong reaction in Washington. I said I
had been directed to express most serious concern of USG. I added that
our decision to participate in Paris talks was evidence of our continuing
interest in maintaining normal relations. President interjected that he
welcomed USG decision, and interpreted it in same spirit. I went on to
cover other points contained para 2 reftel.
3. When I mentioned Presidents private statement to Ambassador
Korry about Anaconda notes, President said he had indeed told my
predecessor that he respected Anacondas full right to appeal its case in
US courts. If Anaconda should win its case in New York, while GOC
won in Chile, he presumed some international tribunal would have to
decide between jurisdictions. (Comment: From the way Allende de-
scribed his conversation with Ambassador Korry, I got impression he
regarded his remark as merely expressing recognition that Anaconda
could appropriately seek legal remedy in US. Allende gave no indica-
tion he regarded GOC as committed to facilitate favorable outcome. I
believe we should also avoid conclusion that his reference today to pos-
sible appeal to international tribunal is commitment to arbitration of
1
Source: National Archives, RG 59, Central Files 197073, INCO 152 CHILE. Se-
cret; Priority; Exdis.
2
Document 284.
378-376/428-S/80023
752 Foreign Relations, 19691976, Volume XXI
our differences. Pres made comment in somewhat off-hand way, and I
doubt that he was conveying considered GOC position.)
4. When I referred to Kennecotts belief that El Teniente notes
would be paid, Allende launched into discussion of Chiles mining
problems. He alleged Kennecott management had failed to install ade-
quate water system at El Teniente and had overridden Chilean tech-
nical advice on a number of questions. He alleged Kennecott had failed
to train Chilean personnel adequately in operation and maintenance of
converters.
5. I made points contained para 3 reftel. We had some back-
and-forth about need to preserve and widen flexibility on both sides.
Pres asserted this was what he desired. When I noted our view of the
nature of the Anaconda and Braden obligations Allende acknowledged
that Braden notes had originally been unconditionally guaranteed.
6. Allende took issue with me over his constitutional obligation
regarding mixed mining companies debts. He said constitutional com-
mitment was explicit in giving him responsibility in this matter, re-
marking that Ambassador Korry had once acknowledged in conversa-
tion that Allende had been handed hot potato. Having been given
this authority, President had to explain his use of it or failure to use it to
his people and nation.
7. With respect to Braden notes, President said his intention was to
handle matter as fairly as possible. Considering that French consultants
(he was not, he said, acting on basis Soviet advice) had posed question
of improper utilization of expansion-program funds, Allende felt he
had no alternative but to address this question. He intends to form ad-
visory committee of Chilean and Finnish experts. He does not he said
wish determination to be punitive or excessive. (Comment: While Presi-
dent Allende may at this moment mean what he says, we must recog-
nize that political pressures on him and Chiles present financial plight
make it doubtful that review will come out this way.)
8. I referred to views of Codelco on expansion program at El Ten-
iente and fact they were not altogether sustained by the Contraloria. (I
had not received States 005020
3
when conversation took place, but I do
not believe I left any implication that USG accepts Contralorias $20
million deduction.)
9. I made other points contained para 4 reftel. Allendes reaction to
my statement about Chilean majority ownership and majority repre-
sentation on board of El Teniente was that management remained in
Kennecotts hands and it was management that made investment
decisions.
3
Dated January 11. (National Archives, RG 59, Central Files 197073, INCO 152
CHILE)
378-376/428-S/80023
November 5, 1970December 31, 1972 753
10. Re question of discriminatory suspension Braden notes, Al-
lende alleged that investments covered by Braden loan were separate
frominvestments made with other loans, and could be segregated from
expansion program taken as a whole. Allende went on to say that his
committee might well find most of Braden loan properly used, and
would deduct only improper investments.
11. Re para 7 of Decree 124, Allende told me he had no intention of
reducing payment to other creditors. I asked when and how other cred-
itors might be reassured, in light of Decree 124, that obligations would
be respected in full. Allende said he would try to work this out quickly.
12. Re Anaconda, when I made points contained para 4 (d) of
reftel, Allende asserted Chilean constitutional amendment was clear,
and GOC was obliged to act in accordance with its intent.
13. I reiterated desirability of maintaining maximum flexibility for
reaching solution and invited President to consider possibilities. I
added that US looks forward to constructive discussion debt questions
during Paris talks. Allende asked me: Are you saying you want to talk
with us about copper debts before Paris discussions start? I said my
understanding was that US delegation would go to Paris prepared to
hold discussions with Chileans at such time as US and Chilean delega-
tions would mutually arrange.
14. In closing I reiterated concern over unilateral nature recent
Chilean actions and expressed hope we could work toward solution
both sides could accept. President Allende expressed hope USG would
assume flexible and understanding attitude in Paris talks, as our pos-
ture would greatly influence attitudes of other creditors.
Davis
378-376/428-S/80023
754 Foreign Relations, 19691976, Volume XXI
286. Memorandum From the Chairman of the Inter-Agency
Committee on Debt Renegotiation (Weintraub) to the Senior
Review Group
1
Washington, January 12, 1972.
SUBJECT
Proposed U.S. Approach to Debt Renegotiation With Chile
The attached memorandum setting forth the proposed U.S. gen-
eral approach to debt renegotiation with Chile is submitted for the con-
sideration of the Senior Review Group. It is the result of many weeks
consultation among the U.S. Government agencies concerned. As
noted in it, various specific financial issues relating to the pursuit of our
general objectives in the negotiations have been referred to the Na-
tional Advisory Council on International Monetary and Financial Pol-
icies for continued study and recommendations.
Sidney Weintraub
Attachment
Memorandum for the Senior Review Group
2
Washington, undated.
SUBJECT
Proposed U.S. Approach to Debt Renegotiation With Chile
The forthcoming debt renegotiation with Chile requires us to bal-
ance several complicated and important issues affecting our interests.
While the Chilean request for debt relief is a measure of the serious eco-
nomic deterioration which has occurred under Allende, it also gives the
Government of Chile opportunities to try to make some significant
political and economic gains at our expense. We can assume that
the Chilean Government would effectively exploit any confrontation
which it could lay at our door, rallying domestic and foreign support to
consolidate itself in power and shifting the burden of responsibility for
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret. Sent through Meyer as Chairman of
the Ad Hoc Working Group on Chile. Distributed to Kissinger, Irwin, Connally, Nutter,
Moorer, and Helms.
2
Secret.
378-376/428-S/80023
November 5, 1970December 31, 1972 755
Chilean economic failures from itself to us. We can further assume that
the Chileans will seize on the first justification which they deem is
available to them to separate us from their other creditors and continue
in default on their heavy debt to us. The Chilean debt relief issue is
also highly sensitive domestically because of uncompensated copper
expropriations.
The Chilean purpose thus will be to obtain the most generous pos-
sible debt relief from its creditors, among whom the United States is
predominant, owning 57% of the total Chilean external public debt; to
reestablish a greater degree of creditworthiness in the Western finan-
cial community; and at the same time to seek to turn to its advantage
any move by the United States which could lead to our isolation from
other creditors and our election to the role of Chiles foreign devil.
Our purpose will be to see that Chile receives the least possible
debt relief; that its creditworthiness be an accurate reflection of its own
seriously deteriorated economy; and that the Allende regime continue
to bear the full responsibility for its own failures without shifting it to
us.
Inter-agency consultations carried on since early December have
achieved substantial agreement on the recommended general ap-
proach to the negotiations. The first issueswhether to enter into nego-
tiations and whether to do so multilaterallyhave already been de-
cided in the affirmative, and with the authorization of the Chairman of
the Senior Review Group we notified the Chileans and the French on
January 5 of our willingness to participate in the Paris Club creditors
meeting expected to take place in early February. (We expect this first
meeting will be limited to collecting information and exchanging pre-
liminary viewpoints.)
The agencies agree that we should take a strong position in the ne-
gotiations that Chile must acknowledge official debt to U.S. private as
well as official creditors, some of which the Government of Chile has
put in question. This debt may be divided into four categories:
a) Debt unconnected with copper, which will probably offer little
difficulty;
b) Copper debt to third parties, which may be more problematical;
c) Debt to Kennecott (OPIC-insured and GOC-guaranteed), which
has been suspended pending a presidential determination of the use-
fulness of the investment; and
d) Copper debt consisting of notes given to Anaconda by the gov-
ernment copper corporation in 1969 in payment for the 51% ownership
transferred to the government at that time, which may be most prob-
lematical because of its virtual nullification under the constitutional
amendment on copper.
We would make known early in our discussions with other cred-
itors and with the Chileans our expectation that Chile would assume all
378-376/428-S/80023
756 Foreign Relations, 19691976, Volume XXI
its debt without distinction, and would vigorously press our position at
every suitable opportunity, stopping short of producing a confronta-
tion with Chile (or damaging isolation from the other creditors) which
would enhance the ability of Chile to reap benefits at our expense.
The agencies agree that while there is a reasonable chance that we
can use our leverage in the negotiations to obtain Chilean assurances
regarding much of the debt, there is no real possibility that the talks can
be successfully exploited to obtain compensation for expropriated U.S.
companies. They agree that the question of compensation should be
raised at the discretion of our negotiators when they see suitable oppor-
tunities for injecting the issue into the talks, but that it would be futile
and disrupting to attempt to make adequate compensation a condition
for agreement on debt rescheduling and would simply lead to a
breakdown.
An analysis of the Chilean request for debt rescheduling is attached.
3
The agencies have referred to the National Advisory Council on
International Monetary and Financial Policies a series of questions on
which our delegation will require additional advice as we get into the
negotiations. These include the following:
a) Whether the international financial institutions (IBRD and IDB
in this case) should participate in rescheduling of debt. The institutions
have customarily not participated in rescheduling, and Chile has not
requested them to do so.
b) The manner of handling the problems of assumption of debt,
Eximbank debt payment acceleration clauses, and the subordination of
various other copper debts to debts owed to Eximbank.
c) The manner in which we should press for strong substantive
participation of the IMF in the debt rescheduling operation, possibly
through a standby agreement or similar form of discipline.
d) The ranges of debt rescheduling terms, including interest rates,
for which our delegation should strive.
The negotiations would proceed in two phases, the first multilat-
eral and then, assuming a memorandum of understanding were
reached between the creditors and Chile, bilaterally with Chile to reach
agreement putting the new debt schedules into effect on loans due to
the United States Government. The question of assurances by Chile on
paying its debt to private parties, and that relating to compensation for
expropriated property, can be put on the table during the multilateral
phase, but will be most relevant before any bilateral agreement is
reached. The United States will thus have the option during each of
these two phases to make decisions on signing agreements, depending
on all circumstances then affecting our relations with Chile.
3
For the attachment, see Document 95 in Foreign Relations, 19691976, vol. E16,
Documents on Chile, 19691973.
378-376/428-S/80023
November 5, 1970December 31, 1972 757
In accordance with established practice and with the memo-
randum to the Secretary of State from Dr. Kissinger dated January 8,
1970,
4
the Secretary has designated the chairman of the U.S. delegation.
This is Sidney Weintraub, Deputy Assistant Secretary for Economic Af-
fairs. The Treasury Department, Eximbank, AID, OPIC and other
agencies as needed will provide representatives on the delegation. The
Treasury representative will be expected to play a major role in the fi-
nancial aspects of the negotiations.
Recommendation
That the Senior Review Group approve the approach to the
Chilean debt renegotiation as set forth above.
4
Not found.
287. Memorandum From Secretary of the Treasury Connally to
President Nixon
1
Washington, January 15, 1972.
It is my understanding that you have made it very clear that we
should keep maximum pressure on Chile.
They have recently stopped repaying their debts to the U.S. Gov-
ernment and reportedly most other creditors. A meeting of creditor na-
tions has been called for early February in Paris to discuss this.
In my view the U.S. objective at this meeting is to get the other
creditors to line up behind the U.S. position. If they were to go off
and negotiate with Chile separately our leverage could be reduced
substantially.
However, we have good reason to believe that far from keeping
the pressure on Chile, they have now been led to believe we have al-
ready agreed to a renegotiation of their debts.
2
(If there is any doubt on
this point, I have top secret information to show you.) As I understand
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret.
2
Nixon underlined the last phrase of this sentence and wrote in the margin, Totally
against my instructions.
378-376/428-S/80023
758 Foreign Relations, 19691976, Volume XXI
it, this is not our intention and our principal purpose is to get broad
creditor support to isolate Chile.
3
Since this matter falls within the Treasury purview, I strongly urge
that Treasury be named to head the U.S. delegation to Paris to insure
that we fully protect our economic interests and keep the pressure on
Chile.
4
There will be a Senior Review Group meeting of the NSC to
discuss this issue shortly.
John Connally
3
Nixon underlined the end of the sentence starting at our principal and wrote in
the margin, This is our policy.
4
Nixon underlined this sentence and wrote in the margin Approved and initialed
it. Connally and Nixon discussed appointing Treasury to head the U.S. delegation to
Paris on Chilean loans in a telephone conversation on January 17. Connally mentioned
his memorandum in a meeting with the President on January 17 from 4:05 to 6:23 p.m. in
the Oval Office. See Document 97. Nixon then summoned Butterfield at 9:50 a.m. on Jan-
uary 18 and demanded to see the memorandum within 10 minutes. Twenty minutes
later, Nixon had the document on his desk and by 10:30 had approved its recommenda-
tions and instructed that it be returned to Connally immediately and that a copy be deliv-
ered to Rogers by hand. (Memorandum from Butterfield to Kissinger, January 18; Na-
tional Archives, Nixon Presidential Materials, NSC Files, Box 776, Country Files, Latin
America, Chile, Vol. VII)
378-376/428-S/80023
November 5, 1970December 31, 1972 759
288. Memorandum from Ashley Hewitt and Robert Hormats of
the National Security Council Staff to the Presidents Deputy
Assistant for National Security Affairs (Haig)
1
Washington, January 19, 1972.
SUBJECT
Implications of Presidents Decision
You asked for an assessment of the political and economic implica-
tions of the Presidents decision regarding Chilean debt rescheduling.
2
The short answer is that this has no immediate effect on our strategy
since we have not agreed to a rescheduling. But following the Paris
creditors meeting in early February, we will have to go back to the
President to get a decision on whether, based on the terms agreed upon
by the creditor nations, we would agree to a rescheduling at that time.
If the creditors terms are tough enough, we have reasonable assurance
from Treasury that Connally will recommend a rescheduling.
Background
Our policy on Chile has been to put as much economic pressure on
the Allende government as possible, but in a way which prevents Al-
lende from throwing the blame for his and Chiles economic troubles
on us. This policy has been highly successful. Allende is in very serious
economic difficulties. The fact that Chile must seek debt renegotiations
at all is one indication of the success of our policy to date. Another indi-
cation is the stunning defeat the Allende government suffered at the
polls in two by-elections held last Sunday. The election results were
due very largely to the economic failures of the Government.
The Presidents decision, if it means that we would not reschedule
even if a satisfactorily tough agreement were to be reached, would
have the following effects:
put us out in front and allow Allende to throw the blame for his
economic problems on us in the eyes of both his own people and other
creditors;
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Top Secret; Sensitive; Exclusively Eyes
Only; Completely Outside the System. Sent for information. The memorandum is ad-
dressed to Haig, but Haig wrote HAK over his own name, and Kissinger initialed the
memorandum. Tab A, entitled Incoming Correspondence Returned, is attached but not
printed.
2
See footnote 4, Document 287.
378-376/428-S/80023
760 Foreign Relations, 19691976, Volume XXI
provide an issue allowing Allende to rally political support and
appeal to the opposition and the Armed Forces to show solidarity with
the Government out of patriotism;
allow Chile to repudiate our debt and thus be relieved of having
to repay debts to the US which constitute approximately 60% of its total
foreign debt;
deprive US entities and institutions, including agencies of the
US Government, of any opportunity of being repaid on substantial
debts to them.
Thus, far from protecting our economic interests, such an arrange-
ment would sacrifice them. The way to be tough on Chile and continue
our successful policy is to:
participate in the Paris club talks as the President has approved,
using them to get the tough multilateral consensus with respect to
Chilean debt renegotiation;
insist that Chile adhere to the renegotiation formula and use our
influence along with that of other creditors to ensure that this solution
is carried out.
FYI: Secretary Connallys memorandum to the President is mis-
leading.
3
We have not agreed to reschedule, although we gather Con-
nally feels that Chile believes otherwise. We have agreed only to discuss
with other creditors possible arrangements for a multilateral resched-
uling. If their terms for rescheduling are not tough enough, we have the
option of not participating. However, the Europeans traditionally take
a tough line on such matters. All agencies, including Treasury, have
agreed at the Assistant Secretary level to what has been done so far and
the general procedures outlined for the proposed Paris meeting. All be-
lieve that a multilateral front, taking a hard line, will serve our eco-
nomic interests best and will put Chile under more pressure than alter-
native strategies.
3
Document 287.
378-376/428-S/80023
November 5, 1970December 31, 1972 761
289. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, January 20, 1972.
SUBJECT
Allende Suffers Major Defeat in Chilean Elections
President Salvador Allendes Popular Unity (UP) coalition suf-
fered a stunning defeat in two by-elections held on Sunday. In the race
for a vacant Senate seat the opposition candidate, a Christian Democrat
(PDC), received 77,000 votes or about 53% of the total, as opposed to
68,000 or about 46% for his opponent, a member of the Socialist Party
(PS). In another area the Nationalist Party (PN) candidate garnered
30,000 votes or a whopping 58% while defeating the UP candidate,
nominally an independent, for a vacant seat in the Chamber of Dep-
uties. The UP candidate got 21,000 votes, or 41%.
Percentages like this are extremely rare in Chile with its multi-
party system and middle-of-the-road tendencies. President Allende
himself only got 36% of the vote in the 1970 Presidential elections
which carried him and the UP to power. The best his leftist coalition has
been able to do was slightly more than 50% in last Aprils municipal
elections, which Allende hailed as a major victory for his Government
and a popular endorsement of his policies. Right up until election time
on Sunday both the Government and the opposition were cautious
about making predictions, and neither was willing to describe the elec-
tions as a plebiscite. It was generally agreed that whoever won, the re-
sults would be close. Hence, the virtual landslide in favor of the opposi-
tion comes as a surprise. A major factor in the result was the unity
shown by the two opposition parties, which are ancient enemies, in
pooling their resources. However this alone cannot explain the propor-
tions of the victory, which must represent some turning away from the
Government and its policies.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret; Sensitive; Eyes Only; Outside
System. Sent for information. A stamped notation on the memorandum indicates the
President saw it. Under a January 17 covering memorandum to Kissinger, Hewitt recom-
mended that Kissinger send this memorandumto the President. Hewitt characterized the
triumph of the anti-Allende politicians in Chilean congressional elections of January 16:
Their victory arises in part from the unity the opposition parties were able to generate,
but must represent some degree of turning away from the Allende government and its
policies on the part of the electorate. Your memo notes our contribution to the victory in
providing some clandestine support to the opposition parties to assist them with cam-
paign expenses. Hewitt concluded, it is important that there be no official comment on
the Chilean election from the administration. Allende will be looking for a way to explain
his defeat and would be delighted to attribute it to our intervention. (Ibid.)
378-376/428-S/80023
762 Foreign Relations, 19691976, Volume XXI
While internal factors were the chief ones in determining the re-
sults, we provided [dollar amount not declassified] in funding through
clandestine channels to the opposition parties to assist with campaign
expenses in Sundays elections.
2
These funds made it possible for the
opposition to bring its message to the voters and offset to some extent
the very determined campaign being carried out by the Government.
It is too early to assess the impact of the elections on the public and
political parties. It will almost certainly increase the polarization of
Chilean society and political life which has been developing quite rap-
idly in recent months. The outcome will increase the confidence of the
opposition parties and should demonstrate to them the benefits of co-
operation. The results may also lead to a schism in Allendes UP coali-
tion. The Socialists are likely to insist that the Government turn away
from the democratic path it has followed up until now and take the
reigns of power into its own hands in order to impose a socialist revolu-
tion, by force if need be. However, the other two major parties in the
UP, the Communists and the Radicals, as well Allende himself, will
probably be reluctant to do this out of fear of the Armed Forces, which
have remained neutral and apolitical thus far but made clear that they
will react sharply to any violation of the Constitution. In any event, Al-
lendes often voiced assertion that it is possible to carry out a socialist
revolution by democratic means has been called seriously into question
by the outcome of this weekends elections.
2
On December 15, 1971, the 40 Committee approved the request for funds. See Doc-
ument 278.
378-376/428-S/80023
November 5, 1970December 31, 1972 763
290. Memorandum From the Assistant Deputy Director for
Coordination, Bureau of Intelligence and Research (McAfee)
to the Director of the Bureau of Intelligence and Research
(Cline)
1
Washington, February 23, 1972.
SUBJECT
ARACIA Meeting, 23 February
PARTICIPANTS
ARAMessrs. Meyer, Crimmins, Hurwitch, Fisher (Chile), Little (Venezuela);
CIAMessrs. [names not declassified]; INR/DDCJames R. Gardner
Chile
Mr. [name not declassified] began with a discussion of the debts of El
Mercurio, the principal PDC newspaper chain. The paper owes to the
First National City Bank, a French Bank, and the Bank of Wisconsin a
total of some $400,000. Of these debts, the most pressing seems to be the
$293,000 owed to the Bank of Wisconsin. There is also pending, ac-
cording to some indications, a government charge for back taxes
amounting to about $250,000. Additionally the paper is losing about
$120,000 a month on its normal operations and, on top of all that, is
compiling bills at the rate of $500,000 a year to the Sun Chemical Com-
pany in Philadelphia for ink and chemicals that seem to be relevant to
the publication of a newspaper.
Mr. [name not declassified] said that CIA had informed its station in
Santiago that it should keep in mind that (1) we believe that Allende
can put El Mercurio out of business anytime he wanted to; (2) US finan-
cial support to El Mercurio could provide only temporary relief; and
(3) our judgment of the importance of keeping El Mercurio alive is to be
balanced against the risk to the remaining of our covert enterprises in
Santiago that funding of El Mercurio on the necessary scale might in-
volve. The consensus of the meeting was that this message to the sta-
tion had been soundly conceived. Mr. Crimmins said that he had
always been one of those who felt that we should do what we could to
keep El Mercurio afloat, but that the one thing that could lead him to
change his mind was the possibility that the infusion of funds in the
amounts that seemed required would be so noticeable as to run serious
risk of discovery.
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile, JanJune 1972. Secret. Drafted by Gardner on February 24. Printed from
an uninitialed copy.
378-376/428-S/80023
764 Foreign Relations, 19691976, Volume XXI
Mr. Gardner wondered if El Mercurio, which is one of Edwards
enterprises, was not being used by Edwards as a means for sucking
funds from the US in order to preserve not only El Mercurio, but some
of the rest of Edwards ventures. The amounts being requested seemed
uncommonly large. Mr. [name not declassified] said that we could not
dismiss this possibility, but that he believed that Edwards had given up
hope of staying in business at all in Chile and that therefore he did not
believe that the Edwards people were playing a game of this sort.
Mr. Gardner recalled that when the question of financing El Mer-
curio had arisen originally last year there had been considerable discus-
sion whether we should keep the paper alive or so manage things that
it could go out with a big bang of the sort that would dramatize the Al-
lende regimes hostile attitude toward a free and critical press. Perhaps
the time had come to consider the possibility of a big bang. Mr. [name
not declassified], responding, expressed his concern that Allende had
brought things to a point that a dramatic death spasm of the sort once
envisaged was no longer possible.
In response to Mr. Hurwitchs query, Mr. [name not declassified]
said that the decision last year to keep El Mercurio going had been cor-
rect. The paper had been invaluable as the principal press voice op-
posed to Allende. Mr. Fisher concurred, citing in particular a conversa-
tion he had had with a Christian Democrat deputy who had stressed
the vital role of El Mercurio.
Mr. Hurwitch wondered why we could not get sufficient money to
El Mercurio to keep it going by operating through US banks.
Mr. [name not declassified] said that a number of questions about El
Mercurio and about the precise nature of its debts had been sent down
to CAS Santiago; it was agreed that we should further discuss what to
do about the paper when we had Santiagos reply in hand.
Before moving on from Chile, Mr. Gardner reminded Mr. [name
not declassified] that he had inquired last week about the possibility of
exploiting the internal fights in the Radical Party which had led a few
days ago to the resignation of Radical ministers from the UP Govern-
ment. He spoke about the upcoming Radical Party conference in April
and wondered if the Agency had had an opportunity to consider
whether we had a situation we could profitably exploit. Mr. [name not
declassified] said that he must confess that the Agency had not had a
chance to concentrate on this problem, that they had sent an inquiry to
its station in Santiago, but that they had made little advance in consid-
ering the matter. They would now do so.
[Omitted here is discussion unrelated to Chile.]
378-376/428-S/80023
November 5, 1970December 31, 1972 765
291. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, February 28, 1972, 2226Z.
953. Ref: State 032299;
2
Santiago 6008 and 6082.
3
Summary:
1. January by elections exposed declining popular support for UP.
Results focused opposition hopes on 1973 elections as means of
checking Allendes revolutionalthough possibility of more violent
solution still exists. Other developments in recent weeks point
toward lack of cohesion and control from the top in Allendes coalition.
Enhanced prospects for successful political opposition may have
slightly strengthened constitutional line in armed forces, while high
command continues resist Soviet blandishments.
2. Allende and UP are badly worried that debt renegotiation will
produce insufficient relief to avoid heavy political cost here. Judging
from course of negotiations so far, there is no foreseeable way to fi-
nance satisfactory level of imports. Only chance for GOC to obtain tem-
porary escape would be if U.S. and Europe were to separate on debt
question. We believe it most important to work together with Euro-
peans toward best and toughest renegotiation we can pull off. GOC
recognition of compensation principle in general terms might be fea-
sible, but we see no present likelihood that Allende will reverse consti-
tutional process on copper. Our pressure for concessions will be effec-
tive only as long as GOC believes there is chance for at least marginally
beneficial relations with USG.
3. We have no indication yet that Soviets committed to massive aid
necessary to reorient Chilean economy. They appear cautious about
taking high-profile role here. In event overwhelming economic crisis
and full-scale break with U.S., however, they might well reconsider.
Within GOC, opposition to over-dependence on USSR persists. Al-
though gradual strengthening of ties with bloc is to be expected. There
are no signs to date that Chinese aid or political influence will be of
more than secondary importance.
1
Source: National Archives, RG 59, Central Files 197073, POL 2 CHILEUS. Secret;
Niact Immediate; Exdis.
2
In telegram 32299, February 25, the Department of State requested the Ambas-
sador to update the November 23, 1971, Next Steps Options Paper on Chile, with par-
ticular regard to internal political and economic events over the coming year,
and Chiles relationship with the Communist bloc powers. (Ibid., POL CHILEUS) The
paper is Document 92 in Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973.
3
Documents 276 and 279.
378-376/428-S/80023
766 Foreign Relations, 19691976, Volume XXI
4. Range of acute economic problemsinflation, declining agricul-
tural production, squeeze on imports, difficulties with copper produc-
tionwill have critical effect on political developments during coming
year. Marxists argue that these can be offset through government con-
trol of the economy used as a base to change political balance of power.
They may be wrong if political system remains intact and if 1973 elec-
tions become popular repudiation. Odds favoring such an outcome
likely to go on improving as long as process unfolds normally and Al-
lende is unable unify Chile against credible and emotionally over-
whelming foreign threat. Other statements of my colleagues and my
views are contained in Santiagos 6008 and 6082. End summary.
January Election Results
2 [1]. January 16 elections confirmed ebbing of UP strength from
highwater 50 percent registered in April 71. It is noteworthy that UP
vote in each of three disparate provinces was about three percentage
points below April. Of course we should be carefulas 5347 is hardly
flood-tide toward the oppositionbut virtually all observers expect
further UP recession if present conditions and trends continue. Chris-
tian Democrats and National Party men who supported alliance
strategy feel strengthened and heartened. Plebiscite is increasingly re-
mote, and opposition is taunting Allendedaring him to call one. Pres-
ident virtually admitted UP expects to be minority force in his analysis
and proposal for single party in 73 elections.
3 [2]. While I shall not repeat observations made in Dec 7 assess-
ment (Santiago 6008), I continue to see Chilean reality in much those
colors. Increased confrontation and polarization remove the prospect,
only slightly obscured recently by summer haze. Castro is a bad
memory, and Allende still does not appear to be mastering his situa-
tion. January elections do seem to have changed political psychology,
however, in at least one respect. CD and National successes have en-
couraged those parties to point more purposefully toward 73 cam-
paign. Politicians never did have much enthusiasm for a golpewith
generals taking over rather than themselves. This is probably more true
now than before. Whether trend will continue is hard to sayas
summer is ending, tensions in the city are in prospect, and school is
starting. We hear reports of vigilante squads of anti-UP small land-
owners in Cautin Province reoccupying farms from the MIRand we
see a few other signs that both opposition forces and leftists continue to
drift toward direct-action armed groupsthough still on a relatively
small scale.
4 [3]. If request for comment on January elections might be
broadened to include observations on a few other events of past weeks,
I would offer following:
378-376/428-S/80023
November 5, 1970December 31, 1972 767
A) Allende tried and failed to avert Senate vote against Toha by
blackmailing CD Party over Tomic loan. This has produced stronger
CD opposition, more disposition to unite with Nationals and slightly
reduced danger of CD split. Mercurios publication of secret Commu-
nist working-paper helped. Even so, CD left wing remains vulnerable,
and Tomic loan episode is not closed.
B) In January Cabinet crisis Allende apparently did want opening
to the center in terms of new faces (Felipe Herrera, Ambassador Jerez,
perhaps a military man) and a somewhat broader appeal. The Commu-
nists stonewalled, and the Socialists strong-armed him. Result was that
Allende looked weak, with Cabinet as hard as before. Allende reacted
by indicating that summer Cabinet would not last longhardly con-
tributing thereby to effectiveness of Ministerial authority. In both polit-
ical and economic policy, Allende seems to be temporizing.
C) Only significant product of Cabinet crisis was inclusion in gov-
ernment of non-Marxist radicals (PIR). This in turn caused further dis-
integration pro-Marxist radicals (PR/CEN). At least there is now
semi-independent voice and some beginning of a non-Marxist force in
the UP. It also means that Allendes single party for 73 is harder to
achieve, and opposition chances of converting their apparent majority
into ongoing parliamentary control are enhanced. Possibility of defec-
tion reunified fragments of Radical Party from UP prior to March 1973
cannot be entirely discounted, especially if Radicals were offered very
favorable commitments by the opposition for the 1973 elections. If this
were to come about, the UP might be reduced to traditional per-
centages of extreme left in 1973 congressional elections.
D) All military arms, including Carabineros, survived year-end
command changes with their integrity as non-Marxist professional
services intact. I understand Allende hesitated for ten days before ap-
pointing service candidate, General Viveros, as Carabinero deputy
over pro-UP general who had been angling for the job. But in this case,
as in other service arms, he finally went along. Only real casualties have
been Col. Labbe (who engaged in flagrant political grandstanding) and
uncertain future of General Canales (who has been notoriously indis-
creet). Perhaps there has been a slight consolidation in the military of
the non-golpista, prudent center. This prudence may come under strain
as the tensions rise in Santiago. To the military centers credit, the gen-
erals so far appear to be resisting Soviet blandishmentsin spite of
great temptation. Now would be a particularly useful time for us to
demonstrate our continuing relationship in some substantive if modest
way.
Foreign Debt and Expropriation
5. Allende and the UP are badly worried about debt renegotiation.
GOC is now coming to realize that prospects are poor for sufficient re-
378-376/428-S/80023
768 Foreign Relations, 19691976, Volume XXI
lief to avoid heavy political cost. As we read reports of Paris talks, Eu-
ropeans are unlikely to go beyond Frei formulawhich would leave
GOC in precarious situation. There is no foreseeable way in which
GOC would be able to finance a level of imports sufficient to fill do-
mestic supply-demand gap. As long as U.S. and Europeans do not pull
apart on debt renegotiation, relief will be insufficient to serve Allendes
purposes. If such separation occurred, GOC might find temporary es-
cape by entering into agreements with Europeans while achieving mor-
atorium on U.S. debt through standstill with us.
6. Expropriation problem may be obstacle to maintaining united
front with Europeans. It might be possible to achieve GOC recognition
of compensation principle in general terms. However, success of
Braden suit does not mean that chances are now good for effectively
linking copper compensation to debt rescheduling. Braden situation
was unique in that Allende could dress his concession in guise of action
legally required to him under copper-nationalization constitutional
amendment. It is not likely that Allende will reverse results of the con-
stitutional process on copper, particularly since he can count on UP and
opposition unanimity on this question. In fact, building of national con-
sensus on two issuesChiles right to own copper companies without
substantial equity compensation and its right to relief from its massive
foreign debt burdenmight be the one way in which Allende could
succeed politically.
7. We should not assume that Allendes realization of his depend-
ence on the West means that there is no limit to our ability to push GOC
toward more reasonable and forthcoming positions. I believe Braden
decision was reached with extreme difficulty by divided and
ill-coordinated Chilean leadership. In broader sense Allende has not
yet faced up to his basic political and economic alternatives. We must
regard Chilean decision making process at present as being in highly
unstable condition. Our pressure for concessions will be effective only
as long as GOC believes there is channel for at least marginally benefi-
cial relations with USG. Fact we have not closed off that hope and have
kept relations in low key correctness probably contributed to decision
pay Braden installment.
4
8. To sum up, we believe it important to stay close to European
creditors and work together toward toughest debt renegotiation deal
we can achieve and get all parties to sign. A breakdown of agreement
4
Chile announced on February 25 that it would make a payment on the loan to
Kennecotts subsidiary, the Braden Copper Company, after a U.S. court in New York
blocked the bank accounts of Chilean agencies. (Juan de Onis, Chile Says She Will Pay
$84.6-Million to Kennecott, New York Times, February 26, 1972, p. 8)
378-376/428-S/80023
November 5, 1970December 31, 1972 769
or a breakdown of U.S. participationwould leave Chile paying us
nothing.
Soviet and Chinese Role
9. Kirilenko visit, Gosplan team, and $50 million hard currency
credit are recent manifestations of Soviet commitment. However, we
have no indication yet that GOC received assurances of that massive
Soviet assistance required to reorient its economy from U.S. and
Western Europe. Gosplan team departed without making large public
promises. Soviets have been cautious about moving too fast toward
high-profile role here.
5
10. Like Castro Soviets probably do not believe in UP strategy of
achieving Socialism in a consumption economy. Soviet and Eastern Eu-
ropean Ambassadors make no secret to me of their conviction that
Chileans dont like to work. Soviets would probably require much
greater austerity than currently prevails before making any massive
concessional commitmentwith resulting political problems for UP.
Nevertheless, Soviet reluctance and caution could change if full-scale
economic crisis develops, accompanied by full Chilean break with U.S.
In those circumstances, we doubt that Soviets would simply allow Al-
lende to slide under.
11. Within GOC/UP there is persisting opposition to over-
dependence on USSR. Allende will be strongly inhibited, even in des-
peration, from taking Cuban routeby his image of his role in history,
by his constituency, by internal balance of political power and by
public opinion. We believe Chile will not willingly become irrevocably
committed to Communist bloc in absence full-scale, nationalistic con-
frontation with U.S. Chances for limiting growth of Communist coun-
tries influence will depend to a degree on maintenance normal Chilean-
U.S. relations. At same time, argument of some Europeans that large
concessions must be made to GOC in order to prevent Cuban repetition
is probably false. As economic situation deteriorates, Allende will press
harder for large-scale bloc aid. He himself probably does not know how
far he would go in desperation and with total break with U.S. In any
case, we must expect progressive strengthening of relations with Com-
munist countries.
12. Many of foregoing considerations apply to Chinese as well as
Soviets. Principal difference lies in fact Chinese have been and are
playing secondary role here. Their recent $65 million loan apparently
includes only about $13 million of hard currency to be made available
5
Politburo member Andrei P. Kirilenko made a visit to Chile in late 1971 and the
Soviet Gosplan team visited in January 1972. The $50 million loan filled a balance-
of-payments gap for Chile. (Davis, Last Two Years, p. 131)
378-376/428-S/80023
770 Foreign Relations, 19691976, Volume XXI
over an undefined period. They are buying copper, but this assurance-
of-market is of only marginal importance. We see no signs that Chinese
are preparing to commit massive quantities of their own limited re-
sources and hard currencies to bailing out Chile.
Probable Course of Events Over Coming Year
13. Economics will largely determine politics in Chile during
months to come. Magnitude of economic problems Chile struggling
with will increase, and capability of GOC to cope with them will be-
come less. Increasing shortages and eventual rationing of selected
products are likely. We can expect massive inflation and eventual loss
of real income even for lower income groups.
14. Effective demand, already high in 1971, will increase further in
1972. GOC has failed in its attempt to hold 1972 real wage increase to
zero. Money wage raises of 4050 percent are widespread.
15. GOC shows no signs of exerting self-discipline in fiscal and
monetary policy. 1972 deficit will be greater than 1971. Central bank is
continuing to increase money supply, so that it remains approximately
double that of a year earlier. On January 31 it was 116 percent greater
than January 31, 1971.
16. Consumers are likely to be less willing to save. Propensity to
save in 1971 was reasonably high, in part because prices were relatively
stable and most goods in adequate supply. This insulated market-place
from significant portion of 1971 wage increase. As shortages spread
and inflation sharpens (it may exceed 5 percent in February) consumers
will increasingly bid for goods. A decline in liquidity preference would
also fuel inflation.
17. Agricultural production, which grew slightly in 1971, will de-
cline in 1972, perhaps as much as 10 percent. Industrial growth will
weaken. Past failures to invest will be felt in production problems in
the future. This year could be a period of net disinvestment in economy
as a whole. Production in many cases depends on availability of foreign
exchange to import components, raw materials and capital equipment.
Prospects of GOC managing this problem skillfully are not bright.
18. Exports will be disappointing. Serious management, labor and
technical problems in Gran Mineria production have produced 7 per-
cent drop from 1971 monthly average last December and 12 percent in
January. Japanese Ambassador tells me his importers have been ad-
vised to expect up to 50 percent shortfall in February from Chuquica-
mata (indicating that deliveries to shipsand foreign exchange in-
comeare beginning seriously to reflect Chuquicamata production
troubles). Actual results may not be that bad, and we should bear in
mind that Chileans probably have capacity to straighten out many of
current troubles in copper industry. Nevertheless, in several months
378-376/428-S/80023
November 5, 1970December 31, 1972 771
ahead, copper production will undoubtedly be disappointing to GOC.
As copper represents 80 percent of foreign exchange earnings, this will
set parameters for overall problem.
19. Relief provided by successful foreign debt rescheduling could
fill part of foreign exchange gap, but probably not all of it. Any agree-
ment in Paris remotely in prospect would give Allende some genuine
relief in exchange for obtaining assurance of payment, but would not
give him enough to save him from situation presently developing.
20. Marxists argue that grim economic scenario need not be deci-
sive if GOC can consolidate its control over the economy and work
from that base to change political balance of power. There is no ques-
tion that continuing nationalization of private firms and other eco-
nomic measures are eroding economic underpinning of opposition
forcesincluding media and political parties. In some ways we are
witnessing a race between the deteriorating Chilean economic situation
as a whole and the deteriorating economic situation of opposition
forces. Marxists may be wrong in their predictions, however, if political
system remains intact and 1973 elections become popular repudiation
of Allende govt. In the meantime, there is some slowdown in revolu-
tionary momentum. There will be tightening of pressure on Allende to
step outside constitutionas opposition attacks take greater toll, as
cohesion of UP coalition loosens, and as critical election test draws
nearer. These pressures are balanced, at least in part, by increasing inhi-
bitionsas popular acceptance declines and as risk of military inter-
vention increases, odds in favor of opposition congressional victory in
1973 are steadily improving, and will probably continue to do so as
long as process unfolds normally and Allende remains unable to unify
Chile against credible and emotionally overwhelming foreign threat.
Davis
378-376/428-S/80023
772 Foreign Relations, 19691976, Volume XXI
292. Memorandum From Secretary of Defense Laird to the
Presidents Assistant for National Security Affairs
(Kissinger)
1
Washington, undated.
SUBJECT
Events in Chile
I am sure that you have followed reports on the significant vic-
tories by the opposition in the Chilean Congressional by-elections this
past January indicating a declining popular support for the Allende
government and its programs. Of particular importance is the report
that these victories have focused opposition hopes on the 1973 Con-
gressional elections as a way to check Allende in his attempt to bring
about a fundamental and far-reaching restructuring of Chile.
While the prospects at present appear encouraging that the oppo-
sition in Chile may retain control of the Congress in 1973, such an event
is still far from certain. As Ambassador Davis pointed out in his recent
general review (Santiago 0953),
2
the Marxists contend that the growing
economic crisis need not be decisive for the Allende government if it
can consolidate its control over the economy and work from that base
to change the political balance in its favor. In fact, the continuing na-
tionalization of Chilean firms and other economic measures are erod-
ing the underpinnings of the opposition forces, including the news
media and the opposition parties. Ambassador Davis comment that:
In some ways we are witnessing a race between the deteriorating
Chilean economic situation as a whole and the deteriorating economic
situation of the opposition forces, is of special pertinence.
Because the retention of the democratic system in Chile depends
primarily on the survival of an effective Chilean political opposition,
we should take every available means to ensure the survivability and
mobility of Chilean democratic forces opposing the Marxist socialist
programs. This would parallel our overt actions underway to assist the
Chilean military as a contining force to restrain the Allende gov-
ernment. In this context, therefore, I recommend that the 40 Committee
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
197172. Secret; Sensitive; Eyes Only. Printed from an unsigned copy. A March 8 cov-
ering memorandum from the Central Intelligence Agency Representative in the Office of
the Secretary of Defense to the Deputy Director for Plans (through EA/DDP), indicates
this memorandum was in response to Kissingers invitation to make specific suggestions
about covert actions in Chile. (Ibid.) See footnote 5, Document 283.
2
Document 291.
378-376/428-S/80023
November 5, 1970December 31, 1972 773
give top priority to the development of an action plan that would pro-
vide for covert financial and material support as appropriate and
necessary:
To the key opposition political parties and their leaders.
To the opposition news media, including radio and television.
To certain independent publishing firms threatened by eco-
nomic strangulation.
To other current and potential foci of opposition, including the
Chilean military and Carabineros.
For accentuating the consequences of the economic crisis in
Chile.
For encouraging certain members of the Allende government to
change or disrupt the course of the UP.
For exposing in appropriate international channels the growing
Soviet influence in Chile.
For dissemination of information within Chile and Latin
America on the economic failure caused by the Marxist programs of the
Allende government.
293. Central Intelligence Agency Intelligence Information Cable
1
TDCS DB315/0205172 Washington, March 10, 1972.
COUNTRY
Chile
DOI
4 March 1972
SUBJECT
Continuing Preparations by General Alfredo Canales for a Military Coup and
Canales Opinion That the Current Controversy Over Constitutional
Interpretation Could Provide the Needed Pretext
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret; Sensitive; Priority; No Foreign
Dissem; Controlled Dissem; No Dissem Abroad; This Information Is Not To Be Included
in Any Other Document. Although the cable states that it should only be distributed to
Kissinger, Cline, and Bennett, a handwritten notation indicates that it was routed within
the White House to Latimer, Lynn, and Jorden.
378-376/428-S/80023
774 Foreign Relations, 19691976, Volume XXI
ACQ
Chile, Santiago. (6 March 1972)
SOURCE
[4 lines not declassified]
Summary: On 4 March 1972 General Alfredo Canales Marquez, Di-
rector of Military Instruction, informed another senior Chilean Army
officer of his contingency planning for a military coup to overthrow the
Government of President Salvador Allende. Canales spoke in general
terms of his plans and of the support he enjoys within the Army. He
surmised that President Allende might try to exceed his constitutional
authority by vetoing certain provisions of the Constitutional reform bill
delineating the three areas of the Chilean economy, thus providing the
military with the necessary pretext to oust him from power. Canales in-
dicated that he is now thinking in terms of April or May 1972 as a tenta-
tive target date for the coup attempt. End summary.
1. (Field comment: [less than 1 line not declassified] TDCSDB315/
0037472,
2
from a source of unknown reliability with good access to
certain senior military officers reported General Canales contention
that his coup movement within the military was ready to undertake ac-
tion at any time, provided a valid reason could be found to justify inter-
vention. This report confirms previous reporting on his plans and indi-
cations that he is continuing his efforts and widening his support.)
2. During a private conversation with a senior officer of the
Chilean Army on 4 March, General Canales spoke in general terms of
his preparations for an eventual military coup against the Popular
Unity (U.P.) government. Canales made reference to the current con-
troversy between President Allende and the political opposition over
the three areas Constitutional reform bill and surmised that this issue
could provide him and his associates with the pretext they needed to
implement their plans. (Headquarters comment: The constitutional
amendment passed by the opposition-controlled Congress seeks to
block further nationalization of private enterprise. The current heated
controversy stems from Allendes threat to veto objectionable provi-
sions and his contention that a two-thirds majority is necessary to over-
ride a Presidential veto, in contrast to the oppositions view that only a
simple majority is necessary. Allende intends to put the question to the
pro-government Constitutional Tribunal for solution, but the opposi-
tion insists this would be a violation of the Constitution since the
proper course would be a national plebiscite. However, while this issue
2
Dated January 15. It is published in Foreign Relations, 19691976, vol. E16, Docu-
ments on Chile, 19691973, Document 96.
378-376/428-S/80023
November 5, 1970December 31, 1972 775
could result in a major political confrontation, there are some indica-
tions that both sides are seeking a compromise.)
3. Canales admitted that the wording of the Constitution was
somewhat vague regarding Presidential veto powers and the per-
centage of the congressional vote needed to override a veto. However,
he said that the great majority of army officers were of the opinion that
Allende and the U.P. intended to violate the spirit of the Constitution in
their quest to achieve political and economic control of the country. He
added that he would not make a move until the Army High Command
had an opportunity to take a position on any action by Allende that was
deemed to exceed his authority. However, if the High Command de-
cides to remain silent while the opposition political parties and most of
the army officers agreed that Allende had acted unconstitutionally, Ca-
nales said he would have to give orders for a move to the many officers
who had pledged to support him in a coup attempt.
4. Canales explained that if the Army failed to move after a Consti-
tutional violation by the President, it could be the last opportunity to
eradicate the Marxist threat in Chile. He described the danger of inac-
tion as twofold: on the one-hand the Chilean people would lose all
hope in the willingness of the Army to protect them against illegal gov-
ernment machinations. On the other hand the young officers of the
Army would feel that Army prestige had been irreparably damaged
and their morale and discipline would be adversely affected. (Head-
quarters comment: [less than 1 line not declassified] whose reliability has
not been fully established reported recently in some detail on the dis-
trust between the High Command and the lower ranking Army of-
ficers. See CS311/0101472.)
3
5. (Source comment: While it is clear that Canales has not yet com-
menced precise planning for his coup attempt, at least in terms of what
officers will have which responsibility during a military takeover, it is
nevertheless apparent that he is serious about laying the groundwork
for such an eventuality and is thinking of late April or early May 1972
as a tentative target date. Further, Canales estimated that 80 per cent of
the Armed Forces would support him in a coup against the gov-
ernment if the President violated the Constitution, and this is probably
accurate. However, the Constitutional issue itself is so complex that it is
impossible to predict at what moment or over what aspect of the issue
the Army, or Canales, will decide that Allende has overstepped his
bounds. Also, the President is fully aware of the threat which the mili-
tary represents to him and will probably make every effort to avoid a
clear violation of the Constitution.) (Headquarters comment: Regarding
3
Not found.
378-376/428-S/80023
776 Foreign Relations, 19691976, Volume XXI
Canales claim of 80 per cent support by the Armed Forces, it is noted
that in the previous report on his plans mentioned in paragraph 1
above, Canales told the source of the report that he had the uncondi-
tional loyalty of about 80 middle-grade officers as the result of his two
years at the War Academy, and also the loyalty of the faculty members
who served with him.)
6. (Headquarters comment: [less than 1 line not declassified] whose reli-
ability is not proved reported in February on the transfers of officers
distrusted by the regime and in particular on the distrust of Canales.
See TDCS314/0103772. Later, the source of this report said the Army
Commander-in-Chief, General Carlos Prats, had tried to force Canales
retirement. See TDCS314/0131872.)
4
7. Field Dissem: Embassy (Ambassador only) at Santiago.
4
Neither TDCS was found.
294. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, April 10, 1972.
SUBJECT
SRG Meeting (April 11)Chile
PURPOSE OF MEETING
1) Review of recent developments in Chile and their implications for U.S. policy;
2) Specifically, what has release of the Jack AndersonITT papers done to our
position in Chile? In the rest of Latin America?
3) What stance do we take in the next round of the Paris Club (April 1718)
regarding rescheduling of Chiles debt and the compensation issue?
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H64, SRG Meeting, Chile, 4/11/72. Secret; Sensitive; Nodis.
Sent for information. Concurred in by Hormats and Kennedy. Kissinger wrote at the top
of the page, MexicoWhere do we stand? Attached are five documents: Kissingers
talking points for the SRG meeting on Chile; an analysis of the Chilean economy; a State
Options Paper with attachments (telegram 1466 from Santiago, March 28, on the Chilean
economy; background data on Chilean debt; telegram 1536 from Santiago, April 1, on
debt rescheduling and ITT/Anderson); the April 4 paper Next Steps Options on Chile
(see Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Document
106); and a November 23, 1971, State Options Paper (ibid., Document 92).
378-376/428-S/80023
November 5, 1970December 31, 1972 777
This meeting provides an opportunity for a thorough-going re-
view of our policy toward Chile. Has it worked? Are the assumptions
behind it still valid? Is time working for us or for Allende? Have we
reached a point where our goals are incompatible? If so, what are our
priorities? It is especially pertinent to raise these questions at this time
because:
The OAS General Assembly is meeting in Washington this
week;
UNCTAD III begins in Santiago this week and will continue for
the next few weeks (Jack Irwin will head the US delegation);
the next round of the Paris talks on Chiles debt will resume on
April 17.
the OAS sessions will offer an opportunity for numerous bilat-
eral talks between high US officials and Latin Americans.
In all of the above fora, the question of US-Chile relations will
figure to a greater or lesser extent. So it is a good time to get our ducks
in a row.
Our basic policy on Chile has been to put maximum pressure on the
Allende government to prevent it from consolidating itself. At the same
time, we have carefully avoided actions that would allow Allende to
rally support domestically or internationally, or to put the blame for his
troubles on the United States.
The consensus around this town and the hemisphere appears to be
that our policy has been highly successful. Allende certainly is in deep
economic trouble (see Analysis paper). There is a strong feeling that
Chile faces economic collapse, sooner or later, regardless of the out-
come of the Paris talks on debt re-scheduling. Allende has also been
under considerable political pressure. The opposition has grown and
become increasingly vocal. Both economic and political unrest have
caused the military to grow increasingly restive and uneasy (though
there is no sign that they are prepared to unseat Allende or involve
themselves directly in the political process at this point).
One still unassessed development has been the ITT/CIA affair, the
Jack Anderson columns and the release of the ITT memoranda.
2
This
has been played to the hilt by the leftist press in Chile and elsewhere in
the hemisphere. Marxist parties forming the Popular Unity (UP) coali-
tion have been exploiting the affair. Thus far, however, President Al-
lende has been fairly cautious about exploiting the matter. (In a major
speech the other day, he made only a few passing references to the ITT
affair.) The Government has translated the ITT memoranda into
2
See Document 296.
378-376/428-S/80023
778 Foreign Relations, 19691976, Volume XXI
Spanish and made them available to the public in a cheap paperback
edition.
There is no doubt that the Anderson revelations have hurt the op-
position, especially former President Frei (who is named in several of
the memoranda and is alleged to have been a central figure in ITTs
block-Allende maneuvering. There are also signs that the Anderson
revelations have stirred new concern among the military, but we have
seen no careful estimate of this aspect.
Although hurt, the opposition has not run for cover over the
Anderson/ITT scandal. They have managed to turn a government-
sponsored investigation of the Anderson allegations against ITT into a
broader investigation into all foreign influence (meaning especially
Cuban support of subversion).
Our policy toward Chile has been a compromise among goals that
are only partly compatible:
We have wished to maximize the chances for favorable internal
change in Chile while at the same time not giving Allende a chance to
make us the scapegoat for his failures. This has meant adopting a cool
but correct stance.
We have sought to isolate Chile as much as possible politically
and economically, while avoiding actions that would support the
charge we are acting out of simple anti-Allende spite.
We have been working hard to get prompt and fair compensa-
tion for and debt repayment to American companies, and to protect the
principle of the inviolability of repayment of just debts and compensa-
tion for nationalized properties.
So far, we have been able to pursue these goals simultaneously.
However, the Anderson affair has raised our posture and brought into
question our political motivation. More important, the Paris talks on
renegotiation of Chiles debts force us to decide what blend we wish to
make of maximum pressure and a correct outward posture.
Ever since Allendes election (in October 1970), a central problem
has been whether time was on his side or on ours. There was some
feeling during the first six months of his rule that time was working for
him. But over the past year, that estimate has changed and our spe-
cialists have assumed that, in the long run, time was working against
Allende. Developments inside Chile, especially the defeat of Allendes
coalition in Congressional by-elections earlier this year, support that
conclusion.
The question now is: will the Anderson affair, or the outcome of
the Paris talks, materially affect the assumption that time is on our side?
You will wish to get the assessment of State, CIA and others on the
Anderson matter. My own judgment is that this has been a temporary
378-376/428-S/80023
November 5, 1970December 31, 1972 779
setback. It does give Allende a breather. But it does not provide him
with a solution to his problems. These things do tend to blow over after
the first sensational impact. It is not, of course, going to make Chiles
settlement with ITT anything but tough and probably confiscatory.
Similarly, it seems unlikely that Allende will be able to avoid for
long the consequences of the economic situation he has created in
Chile. Regardless of the settlement arrived at by the Paris Club, Allende
faces likely economic disaster in another 12 to 18 monthsunless, of
course, the Russians and Chinese undertake a massive bail-out
operation.
They seem reluctant to move in that direction. Moscow certainly
does not want another Cuban rat-hole. A very tough settlement at
Parisalong the lines we originally soughtwould maximize the
pressure on Allende and hasten economic collapse. A soft settle-
mentwith generous terms for rescheduling and the offering of new
lines of creditwould delay the day of reckoning. In fact, something
between these extremes is the likely outcome at Paris.
My own conclusion is: we should continue our present policy of
keeping pressure on Allende but avoid giving him a chance to blame
the US for his troubles. That is going to mean compromising somewhat
our strictly financial objectives. At Paris, we should:
work for the toughest rescheduling formula we can get;
but in doing so, avoid at all costs getting isolated from the other
principal creditors (especially the British and Germans);
3
keep pressure on Allende by preventing debt relief through
simple repudiation, forcing him to resume payments to us and to the
other creditors as early as possible, and seeking to restrict the flow of
new credits to Chile from the US and other non-communist sources.
On strictly financial questions, there are three issues:
How strongly do we insist that Chile repay all the debts owed to
US companies?
How strongly do we demand that Chile pay all we feel she owes
in compensation for expropriated US companies?
If other creditors refuse to go along with our position, to what
extent do we modify our position to get a unified stand, at least among
major creditors? Or do we allow the others to enter into a rescheduling
agreement without us?
3
Kissinger wrote Why? at this point in the margin.
378-376/428-S/80023
780 Foreign Relations, 19691976, Volume XXI
US Objective
We want:
1) a rescheduling agreement that gives Chile the least possible debt
relief;
2) one that forces the Allende regime to bear full responsibility for
its own failures;
3) the largest repayment possible of debts owed to US companies;
4) a commitment that will give the best chance that our companies
will receive adequate repayment for seized properties;
5) an agreement that avoids lengthy default or possible repudia-
tion of debts to US official and private creditors.
However, while working for an agreement that would contain as
much of the above elements as possible, we should find a position that
is both acceptable to us and to enough of the other creditors that they
will stand firm if Chile rejects the offer. At all costs, we must avoid a sit-
uation in which creditors peel off one by one leaving us isolated. This
would allow Chile to continue its present default indefinitely and de-
prive the US Government and companies of repayment.
Chiles Objective
Chiles major motive is to get relief from external debt burdens and
thus avoid an imminent foreign exchange crisis.
Chiles internal and external economic positions are deteriorating
seriously. A year ago, its foreign reserves were $365 million. Now, they
are less than $100 million. Chiles debt for the 197274 period is $974
million (37% of her over-all debt of $2.6 billion). She wants to re-
schedule 85% of her debt for the next three years.
(Breakdown of the terms Chile wants and what the creditors have
thus far been willing to offer is on page 4 of the Analysis paper.)
The Issues
Debt: The issue is whether the US should countenance the unilat-
eral repudiation of debt undertaken by a sovereign government. There
are two particularly tough problems. Chile has passed a constitutional
amendment that:
allows its President to determine that loans made to Chile by the
copper companies will not be repaid if they were not usefully in-
vested. (Allende has ruled that $8.1 million of the $92 million owed to
Braden (Kennecott) should not be repaid on these grounds.)
provides that Chilean government promissory notes to Ana-
conda ($152 million)arising from the 1969 partial nationalization of
mineswill be paid only to the extent that a positive compensation
award is made by the courts. (Allende has determined that Anaconda is
not entitled to compensation because it allegedly took excess profits over
a number of years.)
378-376/428-S/80023
November 5, 1970December 31, 1972 781
States paper lists three options:
1) insist that Chile acknowledge the obligation to pay in full all
government and government-guaranteed obligations, specifically in-
cluding Braden and Anaconda;
2) require Chile to acknowledge the above obligation; however, in
the event of differences after Chiles courts have acted, both parties
would agree to binding arbitration under international law;
3) a statement in the overall agreement recognizing Chiles obliga-
tion to honor all debts and requiring Chile to meet this obligation
through bilateral negotiations or arbitration.
Treasury and State believe we can probably get agreement from
the other creditors somewhere between Options 2 and 3. The major dif-
ference between the agencies is: Treasury thinks Chile, and perhaps
some of the creditors, would be willing to submit the debt dispute to
binding arbitration in order to prolong discussions concerning the
forum and parameters of such arbitrationin other words, to stall.
Treasury also thinks the arbitration process could be prolonged indefi-
nitely, during which time Chile would claim thathaving entered into
arbitrationshe should be given new international credits. Treasury
also thinks we could exert more leverage on Chile in negotiation than
would be possible in arbitration. Specifically, we could put pressure on
Chile to make adjustments in the judicial process now underway which
will affect the Anaconda debts.
State, while it has not yet taken an official position, most likely will
favor going along with arbitration. By doing so, they feel we would not
be compromising our insistence that Chile pay its debts and that
agreeing to this compromise formula would probably assure creditor
unity and avoid a direct confrontation with Chile.
Our view is that we should not let Chile off the hook by agreeing to
arbitration which could be prolonged. If, however, we are forced to fall
back to arbitration we should insist that in the Paris Club Minutes of
Understanding, the arbitration forum and the time frame should be
agreed in advance, thereby preventing Chile from using arbitration as a
dilatory tactic.
Compensation
The gap between the US and Chile on compensation is great. The
Paris Club has indicated willingness to include a clause in any multi-
lateral rescheduling agreement covering the compensation issue. How-
ever, there is likely to be a difference between the US and Chile and the
US and other creditors, concerning the content of such a clause. The
State paper lists the options as:
1) Require Chile to agree to pay prompt, adequate and effective
compensation for expropriated properties. Differences would be sub-
378-376/428-S/80023
782 Foreign Relations, 19691976, Volume XXI
mitted to binding arbitration under international law after a reasonable pe-
riod of time for the Chilean judicial process to work.
2) Require a statement in which Chile would recognize its obliga-
tion to pay just compensation and a clause calling on Chile to meet its
obligations through bilateral negotiations or arbitration.
These options somewhat confuse the issue. The essential point is
whether we agree to arbitration or negotiation. Chile has recently indi-
cated that she might submit to arbitration, but also at times has taken
the position that determinations of compensation, including deduction
for excess profits, are entirely domestic matters subject to final jurisdic-
tion by the Chilean courts. Our agreeing to arbitrate would limit Al-
lendes capacity to exploit the matter domesticallysince a precedent
was set in the case of the 1964 rescheduling for Brazil. But it would not
necessarily improve our prospects for obtaining acceptable compensa-
tion and could delay resolution of the question indefinitely.
Here again there is a difference between State and Treasury. The latter
believe that negotiations would be preferable in that progress in negotia-
tions can be measured more easily than in arbitration, which can be
drawn out in debate over forum and scope. They attach substantial im-
portance to avoiding prolonged arbitration, although they may be
more inclined to agree to this on the issue of expropriation compensa-
tion than debt. States position is as yet unclear, although they will prob-
ably favor arbitration as a way to hold open the chances of getting com-
pensation while avoiding a direct confrontation with Chile.
In our view, because the hope of getting any repayment at all is
quite small, arbitrationeven if prolongedwould probably give us a
better opportunity to receive some payment and would, if conducted under
international auspices, have an international sanction. However, it ad-
mittedly would allow Chile to delay the process if it so desired. Neither
alternative sanctions Chiles failure to compensate for expropriation.
Domestically we could indicate that we had agreed to negotiate or arbi-
trate because the compensation issue was still pending in the Chilean
courts. Andbecause the rescheduling only applies to debts over a
1214 month periodif compensation is not forthcoming we would
have another crack at the Chileans at the end of this year. In this con-
nection, the terms (length of consolidation, interest rate and percentage
of debt rescheduled) are important. The less debt relief Chile gets now,
the sooner she will have to apply for another rescheduling. If at that
time she has not lived up to her obligations on debt and compensation,
we can take a tougher lineand be in a much stronger international
position to do so.
[NB: Secretary Connally feels quite strongly that he has a mandate
from the President to handle the Paris negotiations. Treasury has been
informed that the SRG meeting is designed to put these negotiations in
context of our overall relations with Chile. They accept this premise but
378-376/428-S/80023
November 5, 1970December 31, 1972 783
clearly wish not to be instructed on such matters as a fallback position
in an open meeting where the existence of a fallback, or our desire to be
flexible, could be leaked to the Chileans and thereby weaken our nego-
tiating position. We suggest, therefore, that after the meetingif you
feel it necessaryyou take Volcker and Hennessy aside for a few
minutes to indicate that while you agree that we should not compro-
mise our principles on debt and compensation, you are pleased that
there is some flexibility in their position and that they are interested in
assuring creditor unity and avoiding a confrontation with Chile if pos-
sible. You might indicate that from a foreign policy point of view this is
desirable.]
4
4
Brackets in the original.
295. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, April 10, 1972.
SUBJECT
40 Committee MeetingCHILE [April 11, 1972]
CIAhas come up with a new proposal for additional support for El
Mercurio, the largest newspaperand loudest opposition voicein
Santiago. The new tranche would be for $965,000.00. It breaks down as
follows:
[dollar amount not declassified]to pay off a bank loan that may be
called for payment any day;
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile, 40
Committee Minutes, 1972. Secret; Sensitive; Eyes Only; Outside System. Sent for action.
All brackets with the exception of those indicating omitted material are in the original.
This memorandum was sent to Kissinger by Jessup under an April 10 covering memo-
randum. (Ibid.) Also attached to Jessups memorandum are an April 10 memorandum
from Kennedy to Kissinger, with WJJ (William J. Jorden) initialed at the top indicating
Jorden saw it, and an April 11 memorandum from Kennedy to Kissinger, which Jorden
suggested Kissinger approve. Haig signed approval for Kissinger authorizing covert
support of the El Mercurio project. Another attached memorandum, a memorandum for
the record by Jessup, indicates that the 40 Committee principals (Rush, Irwin, Knowles,
Kissinger, and Helms) approved the $965,000 in funding for El Mercurio.
378-376/428-S/80023
784 Foreign Relations, 19691976, Volume XXI
[dollar amount not declassified]to cover El Mercurios monthly op-
erating deficit through the March 1973 election (Congressional);
[dollar amount not declassified]collateral to underwrite [1 lines
not declassified] processing materials;
[dollar amount not declassified]a contingency fund to help meet
bank debts, new taxes and other emergencies (these payments
would be made on the basis of documented need, endorsed by the
Ambassador).
Background
In September 1971, we decided to support El Mercurio in the
amount of $700,000. We provided an additional $300,000 between Oc-
tober and December.
Discussion
You are awareprobably painfullyof the background on this
one. We seem to get a large bill every few months to keep El Mercurio
afloat. I asked at the pre-40 Committee Meeting if there was any evi-
dence of any siphoning off of funds into other Edwards enterprises.
CIA claims to have looked very hard at this, and found no such
leakage.
The heart of the argument for continuing support is the following
from the CIA paper:
2
The Ambassador and the Chief of Station indicate that El Mercurio
is a significant element in promoting the opposition cause. In our view
El Mercurios continued existence as an independent voice, highly re-
spected both inside and outside Chile, is deemed essential in the forth-
coming period leading up to the Congressional elections which, if Al-
lende wins, will permit him to govern on his terms. . . .
CIAand State favor the proposal. The general feeling appears to be
that we have little choice. El Mercurio is important. It is a thorn in Al-
lendes side. It does help give heart to the opposition forces. Without it,
the Allende government would have much clearer sailing. And if it
goes down the drain because of government pressureas opposed to
financial failurewe have an excellent freedom of the press issue to
use there and in the Hemisphere.
Thus, I reluctantly conclude that we should go along with this. But
before casting a final vote, I would like to hear a thorough rundown on
what El Mercurio has done for us recently. In other words, are we get-
ting a reasonable return on the investment?
There is one discrepancy in the paper. On page 12, it says Ambas-
sador Davis thinks we could get by with $756,000. It is not clear where
2
For the text of the September 8 memorandum for the 40 Committee, see Foreign Re-
lations, 19691976, vol. E16, Documents on Chile, 19691973, Document 82.
378-376/428-S/80023
November 5, 1970December 31, 1972 785
the difference is. CIA believes Davis thinks we can hold off [less than 1
line not declassified]. But I understand that El Mercurio is about to run out
of credit. And without ink, a newspaper is not a newspaperit is just
paper.
Talking Points (attached) follow above general line.
3
3
Attached but not printed.
296. Editorial Note
On April 18, 1972, Chile expropriated International Telephone and
Telegraphs (ITT) assets, valued at approximately $170 million. This
took place following a string of revelations by Washington Post colum-
nist Jack Anderson, beginning on March 21, concerning ITTs attempts
to influence Chilean politics in the tumultuous period between Sep-
tember and November 1970. (Memos Bare ITT Try for Chile Coup,
New York Times, March 21, 1972, p. B13) Documentation on U.S. reac-
tion to the ITT expropriation is in National Archives, RG 59, Central
Files 197073, INCO 152; specifically telegram 1829 from Santiago,
April 18, and telegrams 2361 and 2362, both May 12. Regarding ITTs
contacts with CIA officials, see Foreign Relations, 19691976, vol. E16,
Documents on Chile, 19691973, Document 104.
Beginning in March 1972, the U.S. Senate, under the chairmanship
of Idaho Democrat Frank Church, investigated ITTs activities in the
Subcommittee on Multinational Corporations of the Senate Foreign Re-
lations Committee. Among the witnesses called to testify by the Sub-
committee was Ambassador Edward Korry whose term as Ambas-
sador to Chile had ended in October 1971. In a March 23, 1972, Oval
Office conversation about Korrys testimony, Ziegler stated that Korry
said that he had received instructions to do anything short of a Domin-
ican type [of operation]. He was. He was instructed to, Nixon ex-
plained. But he just failed, the son of a bitch. That is his main problem.
He should have kept Allende from getting in. (National Archives,
Nixon Presidential Materials, White House Tapes, Conversation 226)
378-376/428-S/80023
786 Foreign Relations, 19691976, Volume XXI
297. Editorial Note
The FebruaryApril 1972 Paris Club meetings to reschedule
Chiles debt demonstrated differences between different groups of U.S.
policymakers. President Richard M. Nixon and the Treasury Depart-
ment (Assistant Secretary of the Treasury John M. Hennessy led the
U.S. delega-tion) initially called for a hard-line approach, specifically
bilateral negotiations where presumably the United States would have
more leverage over Chile (for Nixons perspective, see Document 287
and the footnotes thereto). Accordingly, Treasury at first opposed the
signing of the Paris agreement. Department of State officials, however,
called for multilateral arbitration to reschedule Chiles debt. They
feared that if the United States rejected such arbitration at the Paris
Club meetings, Allende would portray North American inflexibility as
an example of a U.S. attempt to undermine his regime and would then
whip up anti-United States, nationalistic fervor (especially after the In-
ternational Telephone and Telegraph revelations). (Telegram 1536
fromSantiago, April 1; National Archives, RG 59, Executive Secretariat,
Briefing Books, 19581976, Lot 72D30, U.S.-Chile Background Papers,
April 1972; see also Document 298) Ambassador Nathaniel M. Davis
made the point that States view concurred with NSDM 93 (Document
175) and cautioned against giving Allende a foreign target he could use
to rally support. Treasury dropped its opposition to signing and the
United States signed the multilateral debt rescheduling agreement on
April 20. At first, Allende demurred from signing, citing Chilean in-
ternal politics. However, in the end, Allende signed the agreement and
received approximately $250 million in debt relief.
378-376/428-S/80023
November 5, 1970December 31, 1972 787
298. Minutes of a Meeting of the Senior Review Group
1
Washington, April 11, 1972, 4:085:15 p.m.
SUBJECT
Chile
PARTICIPATION
ChairmanHenry A. Kissinger CIA
Mr. Richard Helms
State
[name not declassified]
Mr. John N. Irwin, II
Mr. John Crimmins Treasury
Mr. Sidney E. Weintraub Mr. Paul Volcker
Mr. Samuel Eaton Mr. John Hennessy
Defense CIEP
Mr. Kenneth Rush Mr. Peter Flanigan
Mr. G. Warren Nutter
NSC Staff
Mr. Raymond G. Leddy
Mr. Richard T. Kennedy
JCS Mr. William J. Jorden
Lt. Gen. Richard T. Knowles Mr. Robert Hormats
Brig. Gen. Richard Hartman Mr. James T. Hackett
SUMMARY OF CONCLUSIONS
It was agreed that:
Our negotiator will encourage the Paris Club to issue a state-
ment acceptable to us on expropriations. If such a statement is issued,
he is authorized to sign the agreement the group produces, but must
check with Secretary Connally before doing so. If an acceptable state-
ment on expropriations is not issued, our negotiator must check with
Secretary Connally for guidance on whether to break with the rest of
the group.
We will not propose arbitration at the Paris Club meeting but
will accept it if it is raised by others and the Chileans agree to it.
An FMS credit of $10 million will be authorized for Chile after
the conclusion of the Paris Club meeting, if the situation then pre-
vailing justifies it.
Mr. Kissinger: Dick (Helms), would you give us a brief estimate of
the current situation in Chile?
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H64, SRG Meeting, Chile, 4/11/72. Secret. The meeting took
place in the White House Situation Room. Davis sent the minutes to Kissinger under an
April 13 covering memorandum. A copy of the memorandum was sent to Kennedy,
Jorden, and Hormats. (Ibid.)
378-376/428-S/80023
788 Foreign Relations, 19691976, Volume XXI
Mr. Helms: Well, I would like to refer you to our memo of April 4
entitled Chile: Conciliation, Confrontation or Coup, which I believe
most of you have received (Copy attached).
2
Its a complicated situa-
tion and there is no simple solution. There is an increasing polarization
of Chilean society, which is something new. Nevertheless, Chile has
had problems in the past and has always managed to muddle through;
there is a great deal of resiliency in the society. It is possible that the
system of accommodation now operating will persist for some time,
but I do want to stress that conditions in Chile are now different than
they have ever been before and this makes predictions more difficult
than usual. We do plan to do a complete National Estimate in May,
when we know the results of the Paris Club meetings.
Mr. Kissinger: What is your estimate of the effect of the ITT
disclosures?
3
Mr. Helms: The major effect is that they gave Allende a breather,
but the outcome has not been nearly as bad as we thought it would be.
When the story first broke I thought we were really in the soup, but ev-
eryone, including Castro, has acknowledged that we were not in-
volved. Allende himself said that ITT had its hand in the cookie jar but
that the U.S. did not. So it has been a plus for Allende, there is no ques-
tion about that, but his bacon has not been saved by it. The opposition
hasnt been too put down by the affair and are continuing their efforts
against Allende.
Mr. Irwin: Actually, we came out pretty well.
Mr. Hennessy: Cant Allende use it against us by invoking the for-
eign devil theory?
Mr. Helms: Yes, perhaps.
Mr. Crimmins: Its clearly a net plus for Allende, and I want to
stress that the episode is not played out yet. It will be exploited by Al-
lende in the General Assembly, the OAS, UNCTAD, in every forum
and at every opportunity.
Mr. Helms: I agree, but at the beginning we thought wed really
had it on this one and it hasnt turned out so bad after all. The discon-
tent of the Chilean military is unchanged, for example.
(Mr. Flanigan arrived).
Mr. Kissinger: Whats triggering the discontent in the military?
2
Not attached. A copy is in Central Intelligence Agency, Executive Registry, Job
80B01086A, Box 12, Subject Files, Chile, Office of National Estimates. The text of the
memorandum is Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973,
Document 105.
3
See Document 296.
378-376/428-S/80023
November 5, 1970December 31, 1972 789
Mr. Helms: The Russians want to give them a lot of money; they
are offering military equipment for re-equiping the Chilean Army and
Allende wants to take it. However, the Chilean military leaders are con-
servative. They dont like dealing with the Russians and dont want to
become dependent on them for their military supplies and equipment.
They are also reluctant about changing the equipment they have.
Mr. Irwin: And now they have a military man in the cabinet.
Mr. Crimmins: They had one in the previous cabinet; theyve had
military men in the cabinet before, but not very many. The new one is
the Minister of Mines and he is essentially a technician. The military
arent very happy about it because it cuts both ways. They may have
some increased influence, but they also share the responsibility of gov-
ernment actions.
Mr. Leddy: The Defense Attache reports that the military are un-
happy about accusations that they have been involved in coup plots. By
making frequent allegations against them, the Ministry of Justice is
keeping the military on the defensive.
Mr. Crimmins: We were in pretty good shape in Chile prior to the
ITT problem. The economy was going to pot and the problems were
clearly of Allendes own making. He wasnt able to blame any foreign
devils until the ITT affair.
Mr. Leddy: We have a very serious problem with foreign military
credits. The Russians have offered $300 million and we havent been
able to offer anything to counter it. We have requested an increase in
our FMS credit from $5 million to $10 million, but we havent been able
to get it approved. The Chilean military need that small amount badly.
If they can get it, they will be able to use it to argue against the Russian
offer. If they get nothing, it will be very difficult for them to turn down
the Russians.
Mr. Kissinger: Who is holding it up?
Mr. Leddy: Treasury wont approve it.
Mr. Crimmins: Let me explain this matter. The SRG reserved judg-
ment on the amount of FMS credits to Chile, then State and Defense got
together at the Assistant Secretary level and agreed to a figure of $10
million. However, we were concerned about going to the Hill and
asking for an increase of 100% in the FMS credits for Chile at a time
when they are nationalizing U.S. companies, so we agreed that it would
be presented to the Senior Review Group for decision before anything
is done.
Mr. Kissinger: Will you tell me what the purpose of an SRG
meeting is if you get together at State and Defense and make the deci-
sion before the meeting?
378-376/428-S/80023
790 Foreign Relations, 19691976, Volume XXI
Mr. Crimmins: We were acting in the proper role of assistant secre-
taries; consulting at that level and then presenting our conclusions to
the SRG for decision.
Mr. Kissinger: Then if we had to turn you down I would be the
SOB again.
Mr. Crimmins: I think it would be a serious mistake to refuse to
do it.
Mr. Kissinger: I think Ill write a book on bureaucratic methods.
Mr. Crimmins: It was all perfectly proper.
Mr. Hennessy: We (Treasury) have a problem with this, but it is
primarily one of timing. It would have been bad to increase FMS credits
to Chile before the Paris meeting. The Paris meeting is supposed to end
next Tuesday
4
and we would like to make a decision on the FMS credits
on Wednesday. We expect to approve it.
Mr. Leddy: We want to get something approved so we can assure
the Chilean military we plan to stay with them, and to keep them from
accepting the $300 million the Soviets are offering.
Mr. Irwin: Wed like to move on this after the Paris meeting.
Mr. Rush: The Chileans are paying their military equipment debts;
those are not involved at all in the debt extensions being requested at
Paris.
Mr. Kissinger: Lets discuss the debt rescheduling issues. The State
paper
5
suggests three options: 1) to insist that Chile acknowledge the
obligation to pay in full all government and government-guaranteed
obligations, including Braden and Anaconda; 2) to require Chile to ac-
knowledge the obligations, but in the event of differences after Chiles
courts have acted, both parties would agree to binding arbitration
under international law; or 3) to insist on a statement recognizing
Chiles obligation to honor all debts and requiring Chile to meet this
obligation through either bilateral negotiations or arbitration. Chile, I
am sure, would not accept number 1. So the question is which would
we prefer, negotiation or arbitration?
Mr. Irwin: I would like to ask Mr. Hennessy how far he thinks we
should fall back from our position if it looks as though we are going to
be isolated at Paris and at what point we should break completely with
the other members of the Paris Club.
4
April 17.
5
Presumably the State Options Paper attached to Document 294.
378-376/428-S/80023
November 5, 1970December 31, 1972 791
Mr. Hennessy: Thats the key issue. The question of arbitration has
not yet come up at Paris. Weve been reluctant to introduce the idea of
arbitration because we at Treasury feel that were likely to get less than
a satisfactory agreement with eleven other countries involved. We
prefer to negotiate an agreement bilaterally that is acceptable to us and
to the Congress. We have not mentioned arbitration in any of our dis-
cussions at Paris or with the Chileans; we dont want to introduce the
principle.
Mr. Irwin: On the other hand, we dont want to get ourselves too
closely tied to bilateral negotiations, because the Latins dont care
much for the concept of arbitration and they arent likely to start out on
a bilateral basis and then switch in midstream to arbitration.
Mr. Rush: Our position in Chile is a strong one. They have expro-
priated our property without adequate compensation. It is a position
we can justify before world opinion. We can put it to the World Court
and win.
Mr. Hennessy: I dont believe we can use that kind of forum to
achieve a settlement. We are interested in getting a settlement. The
Chileans have to come to a decision to settle before we can make any
progress with them. Once they have made that decision, the forum is
irrelevant. If we sign some agreement to go to arbitration, they will
then start delaying and at the same time will apply to the IFIs for a
series of new loans.
Mr. Kissinger: Then you (Treasury) are against arbitration?
Mr. Hennessy: No, we are against proposing arbitration at this
time.
Mr. Crimmins: Our (State) lawyers think it would be a very signifi-
cant advance in international law to get an agreement on arbitration in
such a significant case as Chilean copper. If arbitration were agreed to,
would the international financial institutions be all that agreeable to
new loans for Chile? Im doubtful about that.
Mr. Hennessy: We (Treasury and State) disagree basically on the
issue of arbitration.
Mr. Rush: In bilateral talks, it is difficult to break off discussion if
things are going badly without being accused of bad faith. In arbitra-
tion, it is difficult either to break off or to be blamed for it.
Mr. Hennessy: We see arbitration as a face-saving device for Al-
lende, which will permit him to go out and solicit new loans.
(Mr. Volcker arrived)
Mr. Kissinger: So you dont want anyone to suggest arbitration be-
cause it may be a face-saving device for the Chileans; but it would not
be a way out of their economic problems for them, would it?
378-376/428-S/80023
792 Foreign Relations, 19691976, Volume XXI
Mr. Hennessy: No, no one suggests that it would be a solution to
their economic problems.
Mr. Irwin: They say they have not yet completed the constitutional
process involved in the expropriations.
Mr. Volcker: They have severe psychological problems to contend
with.
Mr. Kissinger: I am trying to determine your (Treasurys) position.
If you dont want arbitration, then you want bilateral negotiations, is
that correct?
Mr. Hennessy: Thats right.
Mr. Kissinger: You dont want arbitration but will accept it, which
means that we cant suggest arbitration to move the negotiations along.
Mr. Crimmins: I think its quite likely that the Chileans will raise
the issue on their own. I suspect that they will cite their readiness to go
to arbitration on some narrow issue to demonstrate that they are trying
to be conciliatory. In our opinion, their readiness to go to arbitration is
not mere face-saving. It would be an important step for the Latins.
Historically, they have been opposed to arbitration in principle and
if we could get the Chileans to agree to it in a major case it would be
a very important precedent for future compensation cases in Latin
America.
Mr. Hennessy: But before any arbitration can begin you have to ex-
haust all local remedies and that may be forever when you get into local
courts. Its now been four years in the IPC case in Peru.
Mr. Crimmins: Well, were not pushing on IPC.
Mr. Irwin: And there is the Hickenlooper Amendment, too.
Mr. Hennessy: Hickenlooper doesnt apply here.
Mr. Kissinger: Just what is it that the President is supposed to
decide?
Mr. Hennessy: Arbitration or no arbitration.
Mr. Kissinger: If arbitration is being discussed as a possibility
around town Im sure its already been dropped to the Chileans.
Mr. Flanigan: If the Chileans say they want to go to arbiration, is
there any reason our delegation cant request instructions?
Mr. Hennessy: We dont want to pin down our negotiator that way
and tie his hands.
Mr. Kissinger: Who is our negotiator?
Mr. Hennessy: I am.
Mr. Kissinger: Now it is all perfectly clear.
Mr. Hennessy: We want to keep the pressure on Allende to settle,
thats the key point.
378-376/428-S/80023
November 5, 1970December 31, 1972 793
Mr. Flanigan: Does it really keep the pressure on him if he gets an
agreement with the other members of the Paris Club?
Mr. Irwin: Thats what we want to avoid at all costs.
Mr. Rush: That would be the worst of all worlds.
Mr. Irwin: We would like to see some form of statement come out
of the Paris meeting that recognizes the principle of compensation. If
we dont get that, wouldnt it be better simply to walk away? State
prefers that we stay with the Paris group, if we get a statement, even a
statement in principle.
Mr. Kissinger: (to Hennessy) As I understand your view, you will
accept arbitration but dont want to introduce it. You would like to stay
with the group, but would leave if necessary. That seems quite clear;
now why are we all here?
Mr. Flanigan: Is there a chance the Paris Group will have an ac-
ceptable statement on expropriations for consideration?
Mr. Hennessy: Yes, I think they will. There are several drafts
around. There is a Spanish proposal and the French have a draft posi-
tion that looks pretty good, so the question of our walking out may be a
non-starter.
Mr. Rush: We should have our own draft and go in with a firm po-
sition, not wait around to see what is proposed by someone else.
Mr. Hennessy: The Chileans have never been pinned down before
on the expropriation issue.
Mr. Kissinger: Will they be pinned down now?
Mr. Hennessy: Definitely.
Mr. Kissinger: If an unacceptable position is presented at Paris will
it be referred here?
Mr. Volcker: It will be presented ad referendum.
Mr. Kissinger: Can you get a recess while you seek instructions?
Mr. Irwin: We will followit carefully and seek a recess if necessary.
Mr. Kissinger: We here shouldnt get into the question of how arbi-
tration is to be raised, but before we get into a position that isolates us
from the other countries, can we be informed?
Mr. Hennessy: It would be very difficult. Things move very fast at
these meetings and they cant always be stopped for one delegate to
send a cable.
Mr. Kissinger: Why not place a telephone call?
Mr. Irwin: The time difference is advantageous.
Mr. Hennessy: I just dont know if it will be physically possible.
Mr. Helms: Mr. Hennessy is being broken to the saddle.
Mr. Volcker: Instead of tying him down like this, lets just say that
hes not authorized to sign anything without approval from here.
378-376/428-S/80023
794 Foreign Relations, 19691976, Volume XXI
Mr. Irwin: Is it agreed that if you get no acceptable language on ex-
propriation you will break off?
Mr. Hennessy: Yes, if there is no language.
Mr. Irwin: Or if it is clearly unacceptable?
Mr. Hennessy: Yes, but the French proposal looks pretty good.
Mr. Crimmins: Our lawyers dont like the French language.
Mr. Kissinger: We need a chance to go it alone if things are not
going well for us.
Mr. Irwin: I think we should decide these matters now. We will
have a tough time making decisions at the last minute if we are not
agreed in advance.
Mr. Hennessy: If it is necessary, we will separate from the other
countries. I can see a possible announcement that we have so many bi-
lateral problems with Chile that we plan to go to bilateral negotiations
with them. That would not be seen as breaking off, but switching from
multi-lateral to bilateral discussions.
Mr. Kissinger: I have to go to a meeting with the President. Pete
(Flanigan), would you take over?
Mr. Crimmins: The best possible outcome for the Chileans would
be for them to reach agreement with the other creditors, isolating us. So
we feel that our isolation, resulting from a breakoff, would be the least
desirable result for us and the best for them.
Mr. Hennessy: This matter has been brought up before in the Paris
Club. We dont expect to settle it there, but we want to get a principle
established on expropriation. The Paris Club has been much stronger
on the issue of non-repayment of debt than on expropriation.
Mr. Crimmins: The odds are pretty good that there will be a state-
ment on expropriation that is acceptable to us.
Mr. Hennessy: That is our judgment, too.
Mr. Flanigan: I see two basic alternatives here: 1) we dont know
what is going to develop at Paris, so we give Hennessy the option to
use his judgment and knowledge of the situation, and to act accord-
ingly, or 2) we could have him keep in touch with Secretary Connally
and seek guidance on what to do as the situation develops. I think the
second alternative is preferable.
Mr. Irwin: Certainly the second one is preferable, but Hennessy
has a time problem and I am not sure he can do it.
Mr. Volcker: We can tell him that he cant sign anything without
checking.
Mr. Flanigan: Or that he cant sign without specific authorization.
Youre saying its easier for him to check with Treasury and therefore
Treasury should make the decisions.
378-376/428-S/80023
November 5, 1970December 31, 1972 795
Mr. Hennessy: As I say, the prospects for an acceptable statement
look good, but there could be a combination of factors or wording that
wont look good here domestically or in the Congress.
6
Mr. Flanigan: (to Mr. Hennessy) Do you feel that you understand
the mind of this group?
Mr. Hennessy: Do I have the authorization to sign or to break off? I
need the authority to sign if we get what we want.
Mr. Flanigan: I have no problem with your signing if we get what
we want, but you should check before breaking off.
Mr. Volcker: Should he check with Connally?
Mr. Flanigan: I dont think that authority can be delegated to Con-
nally without a decision. In any event you (Hennessy) will be checking
with Secretary Connally either way?
Mr. Hennessy: Yes.
6
The memorandum of understanding issued after the final Paris Club meeting on
April 20 included the statement that Chilean negotiators confirmed their policies of rec-
ognition and of all foreign debt and their acceptance of the principles of payment of a just
compensation for all the nationalizations in conformity with Chilean and international
law, (Jonathan C. Randal, Chile and Creditors Agree on Rescheduling of Debts, Wash-
ington Post, April 20, 1972, p. A8)
299. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, April 28, 1972.
SUBJECT
Chile Financial Issues
Two significant events affecting our political and financial rela-
tions with Chile have occurred:
President Allende announced before a large political rally of his
supporters on April 18 that he would send legislation to the Chilean
Congress for expropriation of all ITT holdings in Chile.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Confidential. Sent for information. A
stamped notation on the memorandum indicates the President saw it.
378-376/428-S/80023
796 Foreign Relations, 19691976, Volume XXI
Chiles foreign creditors meeting in Paris have reached agree-
ment first with each other and then with Chile on a multilateral debt re-
scheduling agreement.
2
The agreement was ad referendum but it will
probably be acceptable to us.
3
There is apparently no causal connection between these two
events. In announcing the ITT expropriation, Allende was probably re-
acting to domestic political pressures, especially a massive march and
rally staged last week by the opposition parties in which as many as
half-a-million people may have participated. The Popular Unity forces
(UP) supporting the government staged a counter-rally on April 18 and
the government pulled out all the stops to at least equal the show put
on by the opposition. Allende presumably had to make a major gesture
to satisfy the appetites of his supporters which had been aroused for
the occasion. There is every indication he was prepared to accept cer-
tain costs, including increased difficulty in reaching agreement with
Chiles creditors at Paris. On April 18 he called in our Ambassador and
informed him that a major policy shift on ITT was in the offing. He also
made a clear distinction between ITT and the U.S. Government, saying
he understood the U.S. Government was not involved in ITTs plotting
against his Government. He has since told our Ambassador that he in-
tends to compensate ITT and will not resort to complex legal devices to
reduce compensation (as in the case of the copper companies).
The Paris club members, including ourselves, had already reached
substantial accord on a debt rescheduling agreement before Allendes
announcement of the ITT expropriation. The terms included:
a single year consolidation period, giving us an opportunity to
reopen the issue at the end of this year if we wish to do so;
agreement by Chile to pay all external public debt whether
owed to governments or private corporations;
agreement by Chile to provide just compensation for all nation-
alized property.
These terms were accepted by the Chilean delegation. After news
of the ITT expropriation reached Paris, however, the Paris club
members called in the Chilean delegate and asked him if ITT would be
included under the terms of the agreement. He declared that the ITT
nationalization announcement was a coincidence and that compensa-
tion would be paid in accordance with domestic and international law.
Holdings of ITT in Chile include: The Chilean Telephone Com-
pany, a telephone equipment manufacturing concern, two hotels and a
2
Nixon circled the last phrase of this sentence and wrote in the margin, note next
page.
3
Nixon wrote in the margin, referring to this paragraph, check with Connally. In
addition, he underlined the phrase acceptable to us, and wrote, not to me.
378-376/428-S/80023
November 5, 1970December 31, 1972 797
minor publishing firm. The total value of its holdings is approximately
$170 million, of which $150 million is invested in the Chilean Tele-
phone Company. Approximately $100 million is covered by OPIC
insurance. The Chilean Government intervened in the telephone com-
pany assuming direct control of its management last year. Under
Chilean law the act did not constitute expropriation, but OPIC con-
cluded that it was sufficient to justify payment of an insurance claim if
ITT chose to file one. ITT has not done so in the hopes of reaching some
kind of negotiated agreement with the Government of Chile.
We can expect proceedings to be protracted in the cases of both ITT
and the copper companies, and we can expect that the Allende gov-
ernment will continue to avoid payment of either debts or compensa-
tion to major American companies. Nevertheless, its acceptance of a
commitment to pay debts and make compensation in the international
context of the Paris club is a major step forward.
4
4
Nixon wrote at the end of the memorandum, K[issinger]Submit this to RN for
decision.
300. Editorial Note
On Tuesday, May 16, 1972, the Chilean Foreign Ministry an-
nounced that its Embassy in Washington, D.C. had been burglarized
over the previous weekend. A Foreign Ministry spokesman described
the incident as a serious matter; an Embassy press attache reported
that so far nothing important is missing, other than four or five tran-
sistor radios, as well as an unspecified number of books and docu-
ments. The Department of State, nonetheless, released a statement of
regret over the incident. (Chile Embassy Burglarized, Washington
Post, May 17, 1972, p. B3) Although the D.C. Metropolitan Police De-
partment and the Federal Bureau of Investigation subsequently aban-
doned the case as unresolved and unimportant, other investigators
including newspaper reporters, congressional staff, and federal prose-
cutorsbegan by January 1973 to explore a possible connection be-
tween the break-in at the Chilean Embassy and the break-in one month
later at Democratic National Committee headquarters in the Watergate
Office Building, in particular, allegations that the burglars in both cases
had been associated with the so-called Plumbers, the White House
Special Investigations Unit.
378-376/428-S/80023
798 Foreign Relations, 19691976, Volume XXI
The Senate Subcommittee on Multinational Corporations, chaired
by Frank Church (D-Idaho), also investigated the break-in at the
Chilean Embassy. The subcommittee staff examined, in particular,
whether International Telegraph and Telephone (ITT)which, due to
allegations of improper involvement in Chilean political affairs, was al-
ready a primary subject of its investigationhad been involved. In a
memorandum to Church and other members of the subcommittee on
February 28, Jerry Levinson, the chief counsel, outlined his initial
findings:
The present line of inquiry began several months ago when we
learned that the Chilean Embassy had been broken into in May 1972,
several weeks before the Watergate affair. The staff interviewed the
D.C. Police and the FBI who investigated. Both dismissed the break as a
routine break-in by a juvenile offender. Careful investigation of the cir-
cumstances leads us to the conclusion that it was not routine. Valuable
office equipment and cash were left untouched. The Ambassadors of-
fice and the office of the First Secretary were both searched and files
were inspected. The thieves walked past several more attractive offices
to get to the First Secretarys office, suggesting they knew where they
were going.
At the same time, a source with excellent contacts in the Cuban
community told the Subcommittee staff that Frank Sturgis had told
other people that he and [Eugenio] Martinez and [Virgilio] Gonzalez,
two other Watergate defendants, had broken into the Embassy to pho-
tograph documents.
Levinson emphasized, however, that the case was circumstantial and
without hard evidence of ITT involvement. (Memorandum from
Levinson to Church, February 28, 1973; Digital National Security
Archives)
Although preoccupied with Watergate, the White House also fol-
lowed developments in the Chilean Embassy case. During a meeting
with J. Fred Buzhardt, Jr., Counsel to the President, in the Oval Office
on May 16, 1973one year after the burglary at the Chilean Embassy
and one day before the Senate Watergate Committee began televised
hearingsPresident Richard Nixon suggested not only that there was a
connection between the two break-ins but also that Buzhardts prede-
cessor, John Dean, was responsible.
Nixon: Well, when you get down, for example, to the break-in at
the Chilean Embassy. That thing was part of the burglars plan
Buzhardt: Thats right.
Nixon: as a cover.
Buzhardt: Thats true.
Nixon: Those assholes are trying to have a coveror a CIA cover.
I dont know. I think Dean concocted that. (National Archives, Nixon
Presidential Materials, White House Tapes, Conversation 9209)
378-376/428-S/80023
November 5, 1970December 31, 1972 799
Nixons comments came two weeks after he had fired Dean and six
weeks before Dean began to testify against Nixon before the Senate
Watergate Committee. In 1999, Dean addressed Nixons accusation, re-
marking, This stuff is laughable; its unbelievable. (George Lardner
and Walter Pincus, Washington Burglars Broke Into Chilean Embassy
as Cover, Tapes Show, Washington Post, February 26, 1999)
Two days after the meeting between Nixon and Buzhardt, Acting
Attorney General Elliot Richardson announced the appointment of Ar-
chibald Cox as Watergate Special Prosecutor. On the basis of informa-
tion collected over the next two months, including grand jury testi-
mony, police reports, and newspaper accounts, the Watergate Special
Prosecution Force decided to investigate allegations that several of the
burglars who had broken into Democratic National Committee Head-
quarters may have also broken into the Chilean Embassy. In a memo-
randum to the files on June 17, 1975exactly three years after the
break-in at WatergateNick Akerman, the Assistant Special Prose-
cutor assigned to the case, summarized his investigation. Despite
lacking direct evidence that the Watergate burglars were involved in
the Chilean Embassy break-in, Akerman concluded that there were
four circumstantial factors which strongly indicate that they were.
First are Sturgis admissions of his involvement to reporters.
Second is the fact that on June 21, 1973, four days after the arrests at the
Watergate, the FBI received information that Barkers men had broken
into the Chilean Embassy in mid-May. Third is the information from
former CIA Director Schlesinger that someone in the CIA told him that
Hunt had been involved in this burglary. Fourth, there is nothing to
disprove that Barker or any members of his group were not in Wash-
ington, D.C. when the burglary occurred. (National Archives, RG 460,
Plumbers Task Force, Investigations of Alleged Illegal Activities, Box 5,
Chilean Embassy Burglary, 6, Recommendations)
378-376/428-S/80023
800 Foreign Relations, 19691976, Volume XXI
301. Memorandum of Conversation
1
Santiago, July 9, 1972.
PARTICIPANTS
[name not declassified]
[name not declassified]
[name not declassified]
[name not declassified]
Daniel N. Arzac, Jr., Political Counselor
SUBJECT
Political Situation
1. [name not declassified] did most of the talking, the others inserting
themselves from time to time to reinforce a point. [name not declassified]
said he had invited me to meet informally with the leaders of the 35
PDCparliamentarians (probably Deputies), who are not entirely happy
with the way the PDC is going under its present leadership. They were
dissatisfied with the assistance in effect given by the U.S. to Allende
such as in the debt renegotiation, and they hoped that, with the U.S.
elections out of the way, the next sessions in December would find the
U.S. taking a stronger line.
2. [name not declassified] main pitch, presented persuasively and el-
oquently, was that the present assistance being provided to the PDC
from U.S. sources should not be put in the hands of the present leader-
ship of the party. We were thereby playing into the hands of those who
want to cooperate with Allende. Fuentealbas group in the party is fun-
damentally the same in its philosophy as those who left the party, and
the links with those who went to the UP remain. Fuentealbas basic am-
bition is to be Chiles next president, and he will cooperate with Al-
lende in pursuit of this goal. The Fuentealba group uses the funds re-
ceived from the U.S. and elsewhere abroad as a weapon to keep the
more level-headed Frei-liners under control. Examples were given of
the heavy expenses a Deputy has to meet, which would be impossible
without the help of the party. Indeed, there were 20 members of the
group of 35 [name not declassified] had mentioned who literally were un-
able to go to Coquimbo to campaign.
1
Source: National Archives, RG 84, Santiago Embassy Files, Box 17, Allende Gov-
ernment, JulyAugust, 1972, NND 989625. Secret. Drafted on July 10 by Arzac. The
meeting was held at the apartment of [name not declassified]. Arzac wrote on the upper
right-hand corner of the page, SENSITIVE. If discussion necessary, go to tank for it. Do
not discuss with other Sections officers without clearance from me. He initialed his
comment.
378-376/428-S/80023
November 5, 1970December 31, 1972 801
3. [name not declassified] mused that given their philosophy, it was
understandable that the European Christian Democrats, [less than 1 line
not declassified] should be assisting the Fuentealba faction. American
firms operating in Chile had unaccountably taken a similar view,
perhaps feeling that the harder-line PDC majority was in any case sym-
pathetic and that they should look to Chilean sources for help. The
latter had in fact mostly helped the PN, and those still in a position to
contribute understandably continue to help the PN. [name not declassi-
fied] said Eduardo Frei had telephoned from Europe that he would
withdraw from the PDC should it reach an agreement with the UP on
the three areas.
4. Through [name not declassified] I would be introduced in the near
future to the career official in charge of narcotics work who was fired
by the present authorities. I would learn from him in detail how the Al-
lende officials are personally involved.
5. The Deputies were highly complimentary about the July 4 recep-
tion, remarking that the Soviet Embassy is the only other mission
which invites all members of Congress to its National Day celebration.
6. [name not declassified] expects to become President of the Cham-
ber of Deputies in the near future.
7. [name not declassified] remarked early in the conversation that
what is significant in the present political situation is that the UP has
managed to consolidate a solid 40 percent support from the Chilean
electorate and that this development had serious political implications
for the future. [name not declassified] in particular denied that the UP
had gained so high a figure, arguing that 35 percent was probably more
accurate, but he and the others agreed that even at this lower figure the
picture was not good. The four Deputies were gloomy about the pros-
pects in the Coquimbo by-election scheduled for July 16.
2
2
The UP won this election. See Foreign Relations, 19691976, vol. E16, Documents
on Chile, 19691973, Document 117.
378-376/428-S/80023
802 Foreign Relations, 19691976, Volume XXI
302. Information Memorandum From the Acting Assistant
Secretary of State for Inter-American Affairs (Crimmins) to
Secretary of State Rogers
1
Washington, July 25, 1972.
Chile: Recent Developments
Political Developments
The Allende government is nearing the end of its second year in
power beset by deepening political and economic problems. While it
has accomplished much of its revolutionary program, its popularity
has slipped steadily from its high point of 50 percent in municipal elec-
tions in January 1971, compounding its problem of dealing with an
opposition-controlled Congress. The governing Popular Unity coali-
tion (UP) itself is divided on tactics, with the Socialists generally
pressing for acceleration of the revolution and the Communists for its
consolidation. The opposition has capitalized on the governments
poor economic performance and a series of political mistakes, and is be-
ginning to concentrate energies on the March 1973 Congressional elec-
tions. The current outlook is that it stands a good chance to retain, if not
increase, its appreciable majority in the Congress. It takes comfort in
the demonstrated inability of the UP to win a popular vote majority in
the various municipal elections, Congressional by-elections and uni-
versity elections which have been held up to mid-July. The UP won the
July 16 Congressional by-election in Coquimbo, but the opposition em-
phasizes the six percent decline in the UP vote from the April 1971 mu-
nicipal elections in this traditional UP stronghold. In recent elections
within the CUT (National Labor Confederation), long dominated by
the Communists, the opposition Christian Democrats made impressive
gains.
Following a breakdown in talks between the Christian Democrats
(PDC) and the UP on a proposed constitutional amendment restruc-
turing the economy, PDC Senators on July 7 joined other opposition
forces in rejecting Allendes veto of the PDC-sponsored version of the
bill. The bill now goes to the Chamber of Deputies. The opposition
claims only a simple majority is needed to override the veto; the UP
contends that a two-thirds vote is required. In another manifestation of
the virtual political impasse now prevailing between the UP and the
opposition, the Chamber of Deputies on July 5 approved impeachment
1
Source: National Archives, RG 59, Central Files 197073, POL 15 CHILE. Secret.
Drafted by Fisher.
378-376/428-S/80023
November 5, 1970December 31, 1972 803
charges against Socialist Interior Minister Del Canto, resulting in his
automatic suspension from office.
Allende and the UP are approaching a political crisis, aggravated
by the intractability and seriousness of the countrys economic
problems (see below). In May a small ultra-leftist faction (MIR) demon-
strated in the streets of Concepcion against what it considered the ex-
cessively slow pace of the revolution. The resulting disorders led to ex-
posure of serious differences within the UP on how to deal with basic
political and economic problems. A top-level UP conclave lasting about
three weeks failed to reconcile the differences, and a major speech by
Allende which was to define a newly agreed policy was delayed until
July 24 and still failed to set forth any new departures. The speech nev-
ertheless is one of the governments frankest admissions thus far of the
seriousness of its economic problems. It reiterates vague accusations of
external pressures, including an allegedly deliberate reduction in lines
of credit from the United States. It exhorts Chilean workers to prepare
themselves for austerity.
There are indications that Allende will soon announce specific new
economic measures tightening the squeeze on the middle and upper
classes, and requiring the workers to produce more without expecta-
tion of continued increases in their standard of living. There are reports
that he may also announce new social measures, which could provide
clues on the direction the acceleration vs. consolidation conflict within
the UP might be taking.
For a thorough discussion of the outlook in Chile as of the end of
June, see NIE 9472 entitled Chile: The Alternatives Facing the Al-
lende Regime, at Tab A.
2
Economic Developments
As Allende stated in his July 24 speech, the Chilean workers in-
come increased 55 percent during 1971 while prices increased 22.9 per-
cent. This significant increase in working class consumption required
massive food and other consumer item imports which, together with
other changes in capital flows resulting from UP policies, virtually used
up the nearly $400 million foreign exchange cushion which Allende in-
herited from the Frei government.
Low productivity in the mining sector and continued low copper
prices have limited Chiles exchange earnings from its principal ex-
portcopper accounts for 75 to 80 percent of the total. Despite the par-
tial rescheduling of foreign debt repayments falling due during the 14
months ending December 30, 1972, and despite claims of new credits
2
Tab A, the June 29 NIE 9472, is not attached. See Foreign Relations, 19691976, vol.
E16, Documents on Chile, 19691973, Document 116.
378-376/428-S/80023
804 Foreign Relations, 19691976, Volume XXI
totaling $400 million from the socialist world, including $260 million
from the USSR announced in mid-July, Chile faces a grave balance of
payments deficit in 1972, possibly as much as $300 million.
Inflationary pressures built up by the GOCs decision to raise
worker consumption levels have begun to force the inflation rate into a
steep upward spiral from the relatively stable and moderate (for Chile)
figure of about 25 percent per year which has prevailed during the past
year or so. GOC policies produced in 1971 a negative investment rate in
the private sector of 16 percent. This, together with a low rate of new
investment in the public sector and slack labor discipline and produc-
tivity, will make it extremely difficult for the GOC to bring industrial
production to its minimum goals. Its agrarian reform program has
sowed uncertainty and confusion in the rural sector, with adverse ef-
fect on agricultural production. Resulting shortages of consumer goods
are day-by-day forcing the GOC closer to unaccustomed rationing. We
can expect to see the GOC resort to a variety of measures to reduce the
buying power of the middle and upper classes, the most recent sign
being an intelligence report on its intent to call in and replace all cur-
rency in circulation. Presumed purposes would be to reduce the money
supply and to frighten holders of accumulations of currency into for-
feiting them rather than risk exposure to charges of illegal or irregular
acts.
Status Report on U.S.Chile Issues
On April 19 we signed the Paris Club Memorandum of Under-
standing which opened the way to bilateral debt rescheduling negotia-
tions between the GOC and creditor governments. The Memorandum
of Understanding contained undertakings by Chile to recognize the va-
lidity of, and to repay, all debts contracted or guaranteed by the GOC;
and in cases of nationalization, to grant just compensation in accord-
ance with Chilean legislation and international law as reflected in the
principles of Resolution 1803 of the UN.
3
In entering into preliminary
bilateral negotiations with Chile last June, we made it clear that we ex-
pected the debt and compensation issues to be dealt with parallel to our
talks on debt rescheduling.
Our bilateral debt rescheduling talks have thus far not gone be-
yond the exchange of technical information.
There has been no progress registered on debt and compensation
matters. The Special Copper Tribunal created by the copper expropria-
3
UN General Assembly Resolution 1803, adopted December 14, 1962, states that
The right of peoples and nations to permanent sovereignty over their national wealth
and resources must be exercised in the interest of their national development and of the
well-being of the people of the State concerned. (UN Document A/5217; Resolution
1803 (XVII), adopted December 14, 1962)
378-376/428-S/80023
November 5, 1970December 31, 1972 805
tion amendment to the Constitution reportedly will hand down a deci-
sion in August on the appealability of Allendes excess profits rulings.
These rulings had the effect of putting Anaconda and Kennecott in a
negative compensation position with respect to their expropriated in-
vestment in Chile.
For a current status report on Chile debt rescheduling, see the
memorandum at Tab B.
4
4
Attached but not printed.
303. Central Intelligence Agency Intelligence Information Cable
1
TDCS DB 315/0731472 Washington, August 29, 1972.
COUNTRY
Chile
DOI
Late August 1972
SUBJECT
Efforts by Patria y Libertad (P&L) and Business Leaders To Provoke a Coup
Within 60 Days; Attempt by Business Leaders To Establish Contact with General
Canales
Summary: Patria y Libertad (P&L, an extreme right-wing, anti-
government organization) and a substantial portion of the business
community are undertaking actions to increase discontent and inci-
dents of violence, especially in the Santiago area, in order to create an
atmosphere in Chile which would be propitious for a military coup.
The business leaders involved are trying to foment strikes and labor
conflicts, while P&L will attempt to provoke incidents of violence.
Business leaders are also trying to persuade Congressmen to delay ac-
tion on the governments bill to increase salaries in order to further
public discontent. [less than 1 line not declassified] business leaders are
also attempting to establish contact with General Alfredo Canales, Di-
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile, JulyDecember 1972. Secret; No Foreign Dissem; Controlled Dissem; No
Dissem Abroad; This Information Is Not To Be Included in Any Other Document or
Publication.
378-376/428-S/80023
806 Foreign Relations, 19691976, Volume XXI
rector of Army Instruction and a known opponent of the current gov-
ernment, in order to coordinate subversive activities. End summary.
1. [1 paragraph (5 lines) not declassified]
2. Patria y Libertad, along with a large segment of the business
community, is attempting to provoke the armed forces into a coup
within the next 60 days. [name not declassified], one of the principal
business leaders in Chile, is working closely with P&L in these efforts.
The basic plan of P&L is to foment disorders and discontent wherever
possible, but especially in Santiago, in an attempt to build a political
atmosphere which would be propitious for a military coup. As part of
this plan, P&L is encouraging residents of Santiago to continue the
Banging of Pots every night at 10:00 p.m. The purpose of this is to at-
tempt to provoke the youth brigades of the Popular Unity (U.P.) gov-
ernment into acts of violence in attempts to silence this form of
anti-government expression. ([less than 1 line not declassified] comment:
Pot Banging at 10:00 p.m. became almost a nightly ritual in some
parts of Santiago in the days following the 21 August disturbances.
2
According to El Mercurio of 28 August, groups of U.P. supporters have
been using intimidation tactics, including the throwing of rocks at resi-
dences, in an effort to discourage widespread participation in this
action.)
3. Efforts are also being made by business leaders in Bio-Bio Prov-
ince to exploit the closure by the government of the Radio Agricultura
affiliate in Los Angeles. ([less than 1 line not declassified] comment: The
Radio Agricultura affiliate in Los Angeles was closed by the gov-
ernment on 25 August for what was termed its clear instigation in
connection with the violence which occurred in that city.) Benjamin
Matte, President of the National Society of Farmers, who is also cooper-
ating with P&L, will go to Los Angeles to talk with farmers and mer-
chants in the area and attempt to foment strikes of protest in relation to
the closing of the radio station. ([less than 1 line not declassified] comment:
El Mercurio of 29 August reported that the business leaders in Los An-
geles had agreed that a total strike of commercial establishments, in-
dustries, and farms in the province would begin at 8:00 a.m. on 29 Au-
gust. El Mercurio also published a lengthy list of organizations in
Bio-Bio Province which had agreed to adhere to the strike.) Matte has
also spoken to Deputies Patricio Phillips of the PN and Luis Pareto of
2
On August 21 in Santiago, demonstrators were arrested after they tried to stop
government officials from opening ships closed for a 24-hour protest strike, and house-
wives protested by banging pots. Allende declared a state of emergency. (State of Emer-
gency Declared by Allende, New York Times, August 23, 1972, p. 1) The so-called
Banging of Pots began that night at 10 p.m. as housewives banged empty aluminum
pots in protest against economic hardships. (Joseph Novitski, Allendes Economics Run
Afoul of Household Budget, ibid, August 29, 1972, p. 4)
378-376/428-S/80023
November 5, 1970December 31, 1972 807
the Christian Democratic Party (PDC), both of whom are members of
the Finance Commission in the lower house of Congress, to urge them
to delay action on the governments bill to provide salary increases in
order to increase public discontent. Phillips and Pareto agreed to do
this.
4. P&L claims that its military contacts feel as it does; i.e., that polit-
ical parties have failed; that a new nationalistic movement is needed in
Chile; and that when the military moves, it will do so against all polit-
ical parties, not merely the leftist ones. ([less than 1 line not declassified]
P&L had an internal crisis about a month ago. Some leaders were in
favor of legitimate political action to remove President Salvador Al-
lende, but these leaders were either removed from the organization or
reoriented, and the more extreme viewpoint, as espoused by P&L
President Pablo Rodriguez, now prevails.)
5. [1 paragraph (3 lines) not declassified]
6. [1 lines not declassified], in representation of the business com-
munity, spoke with Lt. Colonel Ramon Letelier, aide to Army General
Alfredo Canales, and a personal friend of [name not declassified] of long
standing. [name not declassified] requested that an interview be set up
with Canales, when the latter returns to Santiago. The [less than 1 line
not declassified] leader told Letelier that the business community feels
that it cannot rely on the political parties, that time is running out and
that coordination is necessary between the business community and
General Canales.
7. Letelier told [name not declassified] that he would attempt to ar-
range an appointment with Canales; [1 lines not declassified]. The
Army officer then asked [name not declassified] what the business com-
munity could do for the military. [name not declassified] replied that
business leaders were attempting to foment conflicts and strikes. He
added that the business community does not want a commitment from
Canales, it merely wants to coordinate its plans with him and to offer
him whatever support he might want, either in provoking incidents or
in providing technical assistance to a military government, once it is
established.
8. During the conversation, Letelier confided to [name not declassi-
fied] that a number of key unit commanders stand ready to move when-
ever they are called upon to do so by General Canales, that the military
also feels political parties are not the solution to Chiles problems, and
that a new nationalistic approach is needed.
9. ([less than 1 line not declassified] comment: [less than 1 line not declas-
sified], TDCSDB315/0679472, and [less than 1 line not declassified]
378-376/428-S/80023
808 Foreign Relations, 19691976, Volume XXI
TDCSDB315/0703272,
3
[1 lines not declassified] are earlier reports on
P&L plans to carry out violence in an effort to provoke a coup. Refer-
enced reports alleged that Rodriguez was in contact with Generals Ca-
nales, Forrestier, Alvarez and Arturo Vivero Avila, Director of Army
Administrative Support, in relation to his plans. While it cannot be as-
certained at this time what success P&L and the business leaders will
have in their efforts, there appears to be little doubt that political ten-
sions are increasing in Chile. The Movement of the Revolutionary Left
(MIR) issued a public statement on 28 August announcing that it and
other revolutionary elements would attempt to impede the planned
demonstration on 30 August by the opposition parties in Concepcion to
protest the price increases of consumer items. According to El Mercurio
of 29 August, the Socialist Party (PS) has declared itself in a state of
alert. El Mercurio of the same date also provided extensive coverage of
the 28 August confrontation between secondary students and national
police, which came about as a result of efforts by PDC and PN second-
ary students to dislodge MIR students from a Santiago high school.
Public demonstrations against the government during the next few
weeks are expected to continue, as are student protests and probably
additional strikes.)
3
None found.
304. Memorandum From the Chief of the Western Hemisphere
Division of the Directorate of Plans, Central Intelligence
Agency (Shackley) to Director of Central Intelligence Helms
1
Santiago, August 30, 1972.
SUBJECT
The Deteriorating Situation in Chile
1. This memorandum forwards information for the DCI.
2. During August there has been further deterioration in the eco-
nomic and political situation in Chile. More incidents involving ex-
1
Source: Central Intelligence Agency, Executive Registry, Job 80B01086A, Box 12,
Subject Files, Chile. Secret. Sent through the Acting Deputy Director for Plans. A copy
was sent to the DDCI.
378-376/428-S/80023
November 5, 1970December 31, 1972 809
treme groups of the left and right can be expected. Still there is no firm
indication that the military, the central factor in any realistic coup ef-
fort, is preparing to oust Allende.
3. The worsening economic situation is causing increasing polar-
ization between government and opposition forces in Chile. Sharply
mounting inflation, growing scarcity of consumer goods, currency de-
valuation, and acute shortages of foreign exchange are the principal
causes of the current unrest. Sudden sharp rises in the prices of food
staples decreed by the government in August have intensified opposi-
tion feelings and increased popular dissatisfaction. A national shop-
owners strike on 21 August 1972 was followed by a declaration of a
state of emergency in Santiago for several days. Attempts by the gov-
ernment to weaken the strike led to incidents that resulted in general
strikes in two southern provinces. High school students struck for
twenty-four hours on 29 August to protest economic as well as scho-
lastic grievances. The governments promise of substantial wage hikes
by 1 October to mitigate price rises may cool passions somewhat
during the coming weeks.
4. Antagonistic political groups, which have been attacking each
other verbally all year, have lately taken to the streets in demonstra-
tions and counterdemonstrations. Charges by the Popular Unity (U.P.)
coalition that the opposition is engaged in fascist sedition have been
matched by allegations that the government is bent on overthrowing
democratic institutions. At the same time, the campaign for the March
1973 congressional elections is gathering steam and cannot be expected
to lessen tensions by any reckoning. All 150 seats in the Chamber of
Deputies and half of the 50 Senate seats will be contested. The gov-
ernment has no hope of winning control of either house from the oppo-
sition, so the issue revolves around which side can score net gains.
5. In the midst of these events, the case of the Argentine hijackers
intervened to complicate matters for the government and upset Presi-
dent Allendes carefully contrived detente with Argentina.
2
So far, the
Argentine reaction has been limited to the recall of its ambassador, but
if President Lanusse decides on a stronger retaliation, such as the cur-
tailment of beef shipments to Chile, Allendes economic troubles will
be further exacerbated. On the other hand, if the Argentine reaction be-
comes too extreme, it will offer Allende an opportunity to turn the
problem around to a nationalistic and patriotic aspect and distract the
public from its economic woes.
2
On August 15, a group of Argentine leftists raided a jail in Argentina, freed several
political prisoners, and hijacked a jet that flew to Santiago. Ten days later, ten of the guer-
rillas were granted asylum by Allende and safe conduct to Havana. (Argentina Recalls
Envoy From Chile, New York Times, August 27, 1972, p. 9)
378-376/428-S/80023
810 Foreign Relations, 19691976, Volume XXI
6. Militant right-wing groups, supported by business interests, are
now beginning to try to exacerbate tensions in order to provoke the
military into action. Leftist forces, led by the Movement of the Revolu-
tionary Left (MIR), will undoubtedly meet the rightist challenge and
further incidents in the city streets and rural areas could ensue. Al-
though General Alfredo Canales has an organized coup following
amongst key military officers according to past reporting, he has given
no sign during the current unrest of feeling the time is ripe for him.
7. In short, numerous Station reports during the past month indi-
cate some rise in political temperature in Chile; however, there is no in-
dication the military is seriously considering a coup move despite in-
creasing speculation on this possibility. It is a fair assumption that the
political temperature will continue to be escalated by virtue of further
economic deterioration as well as mutually provocative activity on the
part of the extreme rightist and leftist political groups. Given the past
pattern of the Chileans in similar circumstances, we would expect some
action to be taken by the opposition and/or government before the sit-
uation becomes uncontrollable and critical.
Theodore G. Shackley
3
3
Printed from a copy that indicates Shackley signed the original.
305. Editorial Note
From July to September 1972, U.S. Government officials closely fol-
lowed the deteriorating political situation in Chile, including moni-
toring the political parties and private-sector organizations opposed to
the Popular Unity (UP) government. Although Department of State
policymakers stated that US interests would ideally be served by a
downward trend of UP government and concomitant strengthening of
opposition, they were concerned about the adventurist tendencies
of the private sector organizations. As a result, policymakers did not
believe the time was right for a coup because they feared that such a
coup would not be successful, in view of other reports of military
coolness. They feared funneling support to the private-sector organi-
zations would send the Chilean opposition a green light as our fi-
nancial support to elements interested in bringing about a coup now
might be, no matter how hedged about with conditions concerning ad-
venturism, the final determinant in a decision to go for a coup. (Mem-
378-376/428-S/80023
November 5, 1970December 31, 1972 811
orandum from Assistant Secretary of State for Inter-American Affairs
Meyer and Deputy Assistant Secretary of State Crimmins to Ambas-
sador Nathaniel M. Davis, August 30; Department of State, Bureau of
Intelligence and Research, INR/IL Historical Files, Chile, July
December 1972)
Department officials, however, kept the idea of funding the orga-
nizations on the back burner. Davis identified [text not declassified] as an
organization we may want to be able to work with at a later time.
While [text not declassified] appeared to be ready to collapse unless it re-
ceived an immediate infusion of funds, Davis concluded that: If you
can see your way clear to supporting consideration in principle of pri-
vate sector support in the Forty Committee, we could hold off imple-
mentationincluding support in funds to [less than 1 line not declassi-
fied]for as long as possible and recommend it for quick CIA and State
clearance only when local conditions make further delay critical to sur-
vival. (Memorandum from Davis to Meyer and Crimmins, August 31;
ibid.)
Another private sector group, Patria y Libertad, a right-wing polit-
ical-military organization, differed from other groups as it had a spe-
cific 60-day timetable for a coup. Although it was not fully trusted by
the other organizations, all groups shared information and the
common goal to bring about an extended nationwide strike during
September or October. An extended strike would produce a national
crisis and as a result, President Salvador Allende would declare a
state of siege. Subsequently, the military would be called in to help run
the government. (CIA Intelligence Information Cable, TDCS DB315/
0740072, September 1; ibid.)
Central Intelligence Agency officials monitored the strike-
organization efforts and the plans of General Alfredo Canales to fo-
ment a coup. (TDCS DB315/0745572, September 5; 315/0748072,
September 8; 315/0757272, September 8; 315/0772472, September 14;
ibid.) The NSC Staff concluded that the time was not right for an over-
throw as the essential condition for a successful coup against Allende
would be broad support within the military, tacit support from the po-
lice, and fairly strong backing from the people and the political parties
of the opposition. These conditions do not appear now to exist. (Mem-
orandum from Deputy Senior Staff Member of the National Security
Council William J. Jorden to Assistant to the President for National Se-
curity Affairs Henry A. Kissinger, September 6; National Archives,
Nixon Presidential Materials, NSC Files, Box 776, Country Files, Latin
America, Chile, Vol. VII)
378-376/428-S/80023
812 Foreign Relations, 19691976, Volume XXI
306. Memorandum From the Chief of the Western Hemisphere
Division, Directorate for Plans, Central Intelligence Agency
(Shackley) to Director of Central Intelligence Helms
1
Washington, September 13, 1972.
SUBJECT
Chile: Likelihood and Possible Consequences of a Military Coup
1. This memorandum forwards information for the DCI.
2. On 30 August 1972 in a memorandum entitled The Deterio-
rating Situation in Chile,
2
WH Division indicated that the political
temperature in Chile was rising but judged that no military coup was
imminent. Since making that appraisal a number of overt events and
covert intelligence reports have led us to revise our previous opinion.
We now believe that a military attempt to overthrow the Allende gov-
ernment in the immediate future is far more likely than it was on 30 Au-
gust. The following factors have heavily influenced this judgment.
a. Several intelligence reports have confirmed that Commander in
Chief of the Army General Carlos Prats has recently had several clashes
with President Allende over the extradition of Argentine terrorists and
the declaration of a state of emergency in Santiago on 21 August. On
[less than 1 line not declassified] reported that he has now become a
forceful opponent of the Popular Unity (UP) government; that Prats is
aware that General Alfredo Canales is planning to lead a military coup
in mid-September, and that Prats will probably decide to move against
the government before Canales can act.
b. Also on [1 lines not declassified] reported that the Allende gov-
ernment has been warned of a possible coup attempt over the inde-
pendence day holidays and that the DI and National Police (Cara-
bineros) are reinforcing their personnel in the Santiago area in
preparation for such an eventuality.
c. Street demonstrations by the right and the left continue. Al-
though the opposition political parties remain generally opposed to a
military coup attempt at this time, some opposition groups, including
private sector organizations, are seeking to escalate political tensions in
order to encourage military intervention.
1
Source: Central Intelligence Agency, Executive Registry, Job 80B01086A, Box 12,
Subject File, Chile. Secret. Sent through the Acting Deputy Director for Plans. A copy was
sent to the DDCI.
2
Document 304.
378-376/428-S/80023
November 5, 1970December 31, 1972 813
3. The most important of the apparent coup indicators as outlined
in paragraph 2 is the reported intention of General Prats to support mil-
itary action against the government. If Prats remains firm in this intent,
then the chances appear to favor early military intervention against
Allende.
4. There are, however, several factors which tend to indicate that a
coup is still not a certainty. These are:
a. We have no solid information that either General Prats or Gen-
eral Canales are in fact implementing their alleged coup plans. [6 lines
not declassified]
b. Public opinion inside Chile does not appear to favor a military
move at this time. Opposition political parties apparently are not in-
volved in any coup planning and are believed to feel that military ac-
tion, if taken, should follow the March 1973 Congressional elections,
which they feel will demonstrate that the present government does not
represent the mass of the Chilean electorate.
c. Notwithstanding the present crisis, the Chilean people, in-
cluding the military, are prone to avoid difficult and unconstitutional
solutions to their problems and have an outstanding propensity for
sticking to the constitutional path, however rocky.
d. Although we are monitoring all developments in Chile very
carefully, [2 lines not declassified], it may be difficult to identify troop
movements presaging a coup detat because of the natural cover pro-
vided by military preparations for the independence day celebrations.
5. The following are the principal options now open [less than 1 line
not declassified] the U.S. Government:
a. We can continue our present hands-off, monitoring stance.
b. We can pass the word to key military leaders, [less than 1 line not
declassified], that we do not consider the time propitious for a coup and
that we would be reluctant to provide support to a military gov-
ernment in the likely event that a coup attempt is followed by a bloody
civil war.
c. We can provide encouragement to the military, either directly or
indirectly [less than 1 line not declassified].
6. Of the three options, the first appears to be the most appropriate
at this particular moment. We must, however, be prepared for a coup
and should attempt to formulate our response if military intervention
should occur. In this connection the following factors need attention:
Will the U.S. recognize a military government immediately? Is the U.S.
prepared to provide the massive economic support which will be re-
quired to ease the countrys most immediate economic problems? Will
we support the military in case of a civil war?
378-376/428-S/80023
814 Foreign Relations, 19691976, Volume XXI
7. While the temptation to assume a positive role in support of the
military is great, the following considerations indicate a need for
caution:
a. We do not believe that public opinion, inside Chile or abroad, is
yet prepared to accept a military takeover. Popular sentiment is defi-
nitely swinging against Allende, both inside Chile and abroad. Thus
the Marxist experiment should probably be allowed to run its natural
course at least through the March 1973 elections, so that Chileans and
others will be convinced that the Allende government was given a fair
chance and that his brand of socialism is not the road to true social
progress.
b. Although the U.S. (and specifically the CIA) will undoubtedly
be accused of engineering the collapse of the Allende government,
if and when that occurs, these accusations will be exceptionally strident
if a military coup takes place without a dramatic and legitimate pre-
text (such as a flagrant violation of the constitution) and without mas-
sive popular support. Even if a military coup is successful, it will
provide fodder for leftist anti-U.S. and anti-administration propa-
ganda which could be exploited effectively in this country as well as
abroad.
c. An attempted military coup might fail, thus providing the gov-
ernment with an adequate pretext for cancelling the March 1973 elec-
tions and destroying the democratic opposition. An unsuccessful coup
would also probably eliminate the military as a barrier to radicalization
and consolidation of Allendes revolution. A partially successful coup
might plunge the country into a bloody civil war, with unpredictable
consequences.
8. The Station has been directed to exercise extreme care in all its
dealings with Chileans, particularly the military; to carefully monitor
all events, but under no circumstances to attempt to influence them.
Theodore Shackley
378-376/428-S/80023
November 5, 1970December 31, 1972 815
307. Central Intelligence Agency Intelligence Information Cable
1
TDCS DB315/0770172 Washington, September 14, 1972.
COUNTRY
Chile
DOI
13 September 1972
SUBJECT
Appraisal of Situation. Prospects for a Military Coup in Chile in the Near Future
ACQ
Chile, Santiago
SOURCE
This is a field appraisal. It presents the view of this agencys senior officer on the
scene. It is an interpretation based on previously reported information. Prepared
primarily for internal agency use, it is disseminated in the belief that it may be
useful to intelligence analysts in their own assessment of the situation.
Summary: Numerous reports have been received recently relating
to plans for a military coup in the near future. While coup rumors are
traditional in Chile around the 18 September holidays, the reports re-
ceived thus far appear to accurately reflect plotting by General Alfredo
Canales and elements of the private sector; the chances of military in-
tervention in the near future are perhaps greater now than at any time
since President Allende assumed office. If a military coup is attempted
by Canales, it is judged that the attempt would have a fair to good
chance to succeed, provided that the majority of key unit commanders
responded to the coup move and the other services and Carabineros re-
mained sympathetic even if uncommitted. President Allende and the
government parties are aware of the threat of a military coup and are
undertaking both political measures and defensive steps to handle the
situation. While it is judged that the chances of some type of military
coup attempt occurring in the near future may be good, Chileans have
a demonstrated propensity for negotiating settlements and surpassing
crisis situations. End summary.
1. The possibility of military intervention in Chile in the near fu-
ture is greater now than at any time since President Allende came into
power. Discontent among the general population, especially in San-
tiago, is high as a result of the deteriorating economic situation and
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile, JulyDecember 1972. Secret; No Foreign Dissem; Controlled Dissem.
378-376/428-S/80023
816 Foreign Relations, 19691976, Volume XXI
conflicts between the government and the political opposition. Discon-
tent within all three branches of the Armed Forces and the National Po-
lice, especially among the middle and lower grade officers, is high and
appears to be increasing. Their discontent is fed by the same basic
causes as that of the population as a whole. Elements of the private
sector in Chile, which feels itself directly threatened by the policies of
the Allende regime, and Patria y Libertad (P&L, a right wing extremist
group) are attempting to exploit tensions and to create conflict in order
to promote even more discontent. The goal of private sector elements
and P&L is to help create the conditions for military intervention.
2. During the past few weeks a number of reports have been re-
ceived from both military and civilian sources relating to a possible
military coup attempt against President Allende and his government.
The majority of the information thus far received has dealt with the
coup plans of General Alfredo Canales, who has consistently claimed
to have sufficient support among Army officers for the successful
enactment of his plans. Most information in this regard points to the
1819 September period (Chilean Independence holidays) as the pro-
jected timing, although one source, who is part of General Canales
plotting group, claims that the coup could come about at any time, ei-
ther before or after the Independence holidays depending upon the
circumstances.
3. Canales appears to have the support of a large number of Army
unit commanders throughout the country, including most of the prin-
cipal unit commanders in the Santiago area. Canales reportedly also
has fairly rapid coordination and communications with the planning
levels of the private sector which has provoked strikes and conflicts
throughout the country in recent weeks. As of 12 September the private
sector has no provocative actions planned over the independence day
holidays but intends to resume such activities as soon as the festivities
are over.
4. Recent information indicates that perhaps General Carlos Prats,
Army Commander-in-Chief, may now be reconciled to the necessity
for a military move against the government. If true, this would be a
most significant development and would greatly increase the possi-
bility of a coup, unless, of course, some dramatic change in the present
correlation of political forces were to occur, or unless some equally dra-
matic change in the direction or composition of the government were to
take place.
5. Three sources have now reported that Prats and Allende have
had two serious disagreements recently, and two sources claim that
Prats has adopted a more forceful attitude in defending the integrity of
the Army vis-a`-vis the government. This we believe is true. Prats is
very concerned about Army unity, and is undoubtedly aware of the
378-376/428-S/80023
November 5, 1970December 31, 1972 817
coup plans and preparations which are presently being made by Gen-
eral Canales. Thus, it is possible that Prats, who is aware that the ma-
jority of Army officers are opposed to the present government and,
therefore, might be willing to follow Canales in a coup attempt, may be
searching for a means to block Canales, preserve the unity of the Army,
and still find a solution to the current political impasse.
6. Rumors of an impending coup are prevalent in Santiago at this
time. President Allende and the government are aware of these rumors
and it is very likely that they are knowledgeable of the efforts being
made by Canales. Both Allende and leaders of the Communist Party of
Chile (PCCh) have denounced what they called a September plan of
sedition and the Party has alerted the workers and its self-defense
mechanism to be prepared to take over Chilean industries. While the
PCCh is concerned about the threat and is taking defensive actions, it
believes that a coup attempt can be blocked. On 11 September the De-
partment of Investigation (DI, Chilean Civil Police) was alerted by the
government to a possible military coup attempt over the 1819 Sep-
tember holidays. The DI contingent in Santiago has reportedly been
strengthened with DI personnel from the provinces as a defensive
measure.
7. In our view, Allende basically has two options open to him to
defuse the situation. One is to undertake actions to appease the Chris-
tian Democratic Party (PDC) and the Armed Forces, and the other is to
turn to the military as a government participant. A recent report claims
that Allende has contacted a PDC leader, pointed out to him that a mili-
tary coup would also be harmful to the PDC, and requested a six-
month truce between the government and the PDC. The President
told the PDC leader that while the opposition is growing in Chile, it is
the rightist National Party, not the PDC, which is reaping the benefits
of polarization. Allende also offered political concessions to the PDC in
return for the truce.
8. The PDC leadership is divided over the question of military in-
tervention. While left-wing leaders of the party, such as Radomiro
Tomic and Bernardo Leighton, would undoubtedly prefer to reach
some accord with the Allende government, there is evidence that sup-
porters of former President Eduardo Frei are inclining more to the con-
clusion that the Allende regime must be terminated and that military
intervention in some form is required. If a coup were to develop, the
PDC would be more likely to favor a military move headed by the
Army Commander-in-Chief, which would probably have the support
of most of the Army Generals as well as the other services, rather than
one led by Canales.
9. The second option open to Allende, which is much less likely,
would be to invite the military to rule with him. He would grant what-
378-376/428-S/80023
818 Foreign Relations, 19691976, Volume XXI
ever concessions might be necessary to accomplish this, such as the
expulsion of some UP parties from the government and bring about a
radical change in the political and economic direction of his adminis-
tration. We believe that such a move would be attractive to those within
the military who would like to change the present government, but
who would prefer to accomplish this within the framework of constitu-
tional legality.
10. As of this date, the chances are good for some kind of military
attempt in the near future. If Canales attempts to lead his forces
without the cooperation of the other officers of general rank, but with
the support of the majority of Army officers and at least the sympathy
of the other two services, the coup attempt would have a fair to good
chance to succeed, especially if the other two services moved quickly
to support Canales. If the coup movement were to be led by Prats
and the Army High Command, it would probably signify that the
Commanders-in-Chief of the other services and possibly the majority
of the Carabineros were in agreement, and that the effort would be a
coordinated one. Under this scenario, the coup attempt would have a
very good prospect of success.
11. Notwithstanding recent reporting indicating that a military
coup could occur in the near future, there are several factors that augur
against a coup at this time. There is the propensity of Chilean political
and military leaders for finding political means to defuse highly vola-
tile crisis situations. President Allende has shown himself especially
adroit in this type of political maneuvering, and he is apparently
working to find a political solution to the present crisis. Last weeks
high level of public disorder no longer exists. The government has
closed the secondary schools in an effort to keep students from demon-
strating, and the opposition has suspended its march scheduled for 14
September which could have acted as a spark to set off another round
of violence. Additionally, the fact that the government is well aware in-
fluential officers within the military are plotting to overthrow the gov-
ernment eliminates the important element of surprise, which could be
crucial to any successful coup attempt. Although a coup could occur, it
would not be surprising for Chile to get through this crisis, especially
considering the Chileans traditional aversion to violence and their pro-
clivity for negotiating settlements to crisis situations.
2
2
An unidentified person underlined the last sentence, circled the word could,
and wrote in the margin, Not for the first time, it is difficult to tell in which way the sta-
tion is pointing.
378-376/428-S/80023
November 5, 1970December 31, 1972 819
308. Memorandum From the Assistant Secretary of State for
Inter-American Affairs (Meyer) to the Under Secretary of
State for Political Affairs (Johnson)
1
Washington, September 18, 1972.
SUBJECT
Covert Aid to Chilean Private Sector
The attached CIA memorandum
2
together with its later annex,
3
proposes adding a new dimension to our efforts to support the Chilean
opposition against Allendes Popular Unity (UP) coalition by giving
assistance to elements of the Chilean private sector whose sympathies
and interests lie with the opposition parties.
The original memorandum proposed assistance to three organiza-
tions: [4 lines not declassified]. The proposed assistance is designed
fundamentally to strengthen the ability of private sector organizations
to contribute to the political strength of the opposition to the government.
ARA and INR favor a program directed to this objective, but we
have been concerned from the time the proposal was first made that it
not be used to encourage maladroit adventurist elements into rash and
indiscreet efforts at a coup. Our concern, which is reflected in two ex-
changes we have had with Ambassador Davis (attached at Tab A)
4
and
in conversations with him during his recent visit here, has been intensi-
fied by a flow of intelligence reportage from Santiago that strongly sug-
gests that elements of two of the organizations originally selected for
assistance [less than 1 line not declassified] have become actively engaged
in plotting an early attempt against the government, and that much of
this activity is known or suspected by the government. We are unable
to judge whether a coup attempt at this time would be successful; the
information we are getting about the attitude of the military, whose
support would be essential, is ambiguous and inconclusive. Under
these circumstances immediate assistance [less than 1 line not declassi-
fied] appears pointless and even dangerous. Our financial help would
in no substantial way enhance their capability to contribute to a suc-
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile, JulyDecember 1972. Secret. Drafted by Gardner; sent through McAfee
for the Director of INR.
2
Memorandum for the 40 Committee, August 24, is published in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973, Document 118.
3
Although the annex, dated September 14, was not declassified, see below, in-
cluding footnote 5.
4
The August 30 and 31 backchannel messages between Meyer and Crimmins and
Davis are attached but not printed.
378-376/428-S/80023
820 Foreign Relations, 19691976, Volume XXI
cessful coup attempt, and to the extent that it encouraged them to rash
action and consequent failure would put us under prohibitively high
risk of exposure.
Our growing reservations about getting involved now with [less
than 1 line not declassified] are shared fully by Ambassador Davis. We
have therefore won agreement from CIA that no financial support
would be considered for these two until mid-October, and that this will
be given then only if the Department and CIA concur with the recom-
mendation of the Ambassador and CAS. The annex to the CIA memo-
randum that incorporates this agreement requests 40 Committee ap-
proval of [less than 1 line not declassified] which would not be released
without these concurrences.
5
[1 paragraph (6 lines) not declassified]
We do not expect [less than 1 line not declassified] if aid is later given
to them, to act simply as conduits to the political parties. At the same
time, we would expect the money to be used for purposes directly ori-
ented toward energizing these parties, and not for the organizations
own institutional objectives, which might have only an indirect rela-
tionship with our political aims in Chile. To the extent our assistance
would enable these organizations to contribute to the political strength
of the opposition, we could expect the development of other by-
product effects, important in themselves but essentially incidental to
our main objective. These by-products would include principally an
improvement in the ability of these organizations to resist the gov-
ernment drive to weaken further the private sector, and the mainte-
nance of private business, industry, and agriculture as a broad source
of funds for the opposition political parties.
Security is a concern for both us and the Agency. We have not yet
been in covert financial relations with any of the individuals involved,
and the testing period will therefore be one of some delicacy. The
Agency assures us that it will be cautious, and estimates the risk as
being no higher than the norm for our other covert financing activities
in Chile. After considerable discussion with the Agency of the security
problem we accept this judgment, recognizing that it can carry no
iron-clad assurance. The Agency also states that during this period it
will not become so deeply embroiled with the prospective recipients as
to make withdrawal difficult or embarrassing. We do not entirely share
5
The annex does not state clearly enough that the decision to delay aid to [less than 1
line not declassified] arose from concern over reports of their current association with coup
plotting. Also we would not wish to associate ourselves unqualifiedly with the statement
(Para. 2 of the annex) that the three organizations are a significant opposition force de-
serving of financial assistance. It is precisely this point about which we have had the res-
ervations that led to our request to CIA to modify its original proposal. [Footnote is in the
original.]
378-376/428-S/80023
November 5, 1970December 31, 1972 821
the Agencys confidence that withdrawal would be easy, but our
doubts are not sufficiently strong to incline us to oppose the enterprise
on this ground.
After careful consideration of the various factors that are involved,
we believe the proposal should be approved. ARA and INR will be in
close touch with the Agency on the progress of the effort, and there of
course will be a report to the Committee at the end of the trial period. It
is envisaged that those parts of the project that proved successful
would be merged into the overall program which will be launched in
preparation for the March 1973 congressional elections, and which we
anticipate will be submitted to the Committee for this fall.
Recommendation
That you approve immediate steps to initiate an [dollar amount not
declassified] subsidy to [less than 1 line not declassified] for three months;
That you approve in principle support of up to a total of [less than 1
line not declassified] and [less than 1 line not declassified] this support not
to be initiated until after mid-October and then only on concurrence of
the Ambassador and the Department.
6
6
Johnson initialed the Approve option.
309. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, September 19, 1972.
SUBJECT
Chilean Coup Planner Approaches U.S.
General Alfredo Canales, who has been planning a coup for some
time against the Allende government, has made an indirect approach
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret; Sensitive. Sent for information. The
memorandumwas sent through Haig. At the top, Kissinger wrote, AlDiscuss soonest.
Davis is an idiot. HK. On a covering memorandum, Haig wrote, HAKIve asked
Walters to prepare planyou and Kennedy may wish to talk to him before I return.
(Ibid.)
378-376/428-S/80023
822 Foreign Relations, 19691976, Volume XXI
to the U.S. through a CIA contact in Santiago (see attached memo at
Tab A).
2
This information should be read in light of the information (in
this mornings brief) that Canales plotting is rather widely known and
he may soon be dismissed from the Chilean Army.
A Chilean officer, who is a friend and supporter of Canales, has
told us that if the coup plan succeeded, Canales would like the U.S.:
to recognize his regime as soon as possible;
send emergency food relief;
consider granting loans to help Chile weather its dire economic
crisis.
As outlined by this officer, the Canales plan calls for:
suspension of civil liberties for three or four months;
proscription of all political parties for an interim period;
outlawing the Communist Party;
termination of extremist groups of left and right.
After the initial suspension of civil liberties, Canales would bring
about a return to order and gradually reduce restrictions on the
public so that the democratic process could begin to function. Canales
would then try to change the Constitution to limit the number of
parties to two or three. Canales would remain in power until 1976 (date
of the next presidential election). Until then, he would establish a gov-
ernment composed of talented persons, civilian or military, who
would renounce party affiliations and agree to work diligently for the
government.
Under Canales, the three sectors of the economy (private, public
and mixed) would be preserved. But he would encourage private en-
terprise. He would also keep the agrarian reform program but would
try to eliminate its strictly political aspects.
Ambassador Davis is aware of the above message. He has in-
structed that we make no response. If pressed for an answer, our con-
tact will simply say that the information has been reported and that no
response has been received. That seems the right approach under the
circumstancessince Canales may soon be in jail and might, if pressed,
disclose that he was in touch with the U.S. We should remain at arms
length for the time being.
2
Attached but not printed at Tab A is a memorandum from Cord Meyer to Kissin-
ger, which describes the efforts of General Canales to mount a coup and what Canales
wanted from the United States if he was successful. Also attached but not printed at Tab
B is an undated briefing report that states that General Prats was firmly against a coup. In
the margin next to the paragraph that described Pratss opposition, HAK Only is
written. The memorandum also concluded that Canales might be cashiered because of
his plotting.
378-376/428-S/80023
November 5, 1970December 31, 1972 823
310. Memorandum From the Executive Secretary of the 40
Committee (Ratliff) to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, September 20, 1972.
SUBJECT
Financial Support to the Chilean Private Sector
CIA has developed access to leaders of several important groups
in Chiles private sector and requests authority to contact and provide
limited financial assistance to them in order to assess their capabilities
to support the over-all covert political action program (TAB A).
2
Allendes Popular Unity (UP) government has continued to in-
crease its control of the Chilean economy. The private sector only re-
cently has become alarmed and started to resist in an organized way.
CIA thinks that support and encouragement of the politically-oriented
activities of the private sector might be a significant adjunct to the cur-
rent main effort of direct support to opposition political parties.
To explore and develop this potential, CIA proposes working with
[number not declassified] private sector organizations of particular capa-
bility and potential: [5 lines not declassified].
Recent developments in Chile, including strikes, street demonstra-
tions and coup threats, caused State to request additional review of the
original proposal. A compromise position on timing (TAB B) asks ap-
proval for immediate support of up to [less than 1 line not declassified]
which is in danger of collapse due to lack of funds, and up to [dollar
amount not declassified] to the other two private sector organizations
after mid-October (with precise timing to be recommended by the Am-
bassador and Chief of Station and approved by State and CIA).
State, Defense and JCS concur.
Recommendation
That you approve immediate support to [less than 1 line not declassi-
fied] of up to [dollar amount not declassified] and post mid-October assist-
ance to [less than 1 line not declassified] and [less than 1 line not declassified]
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile, JulyDecember 1972. Secret; Eyes Only; Outside System. Sent for action.
Concurred in by Jorden and Kennedy. The memorandum was initialed by Haig.
2
Tab A is the August 24 memorandum to the 40 Committee and Tab B is its Sep-
tember 14 annex. See Document 308 and footnotes 2 and 3 thereto.
378-376/428-S/80023
824 Foreign Relations, 19691976, Volume XXI
of up to [dollar amount not declassified] subject to StateCIANSC ap-
proval of the precise timing.
3
3
Kissinger initialed the Approve option on September 21.
311. Memorandum From the Executive Secretary of the
Department of State (Eliot) to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, October 16, 1972.
SUBJECT
Situation in Chile
Situation
Truckers grievances with the Allende government (over such
issues as freight rates and the scarcity of spare parts) formed the osten-
sible basis of the trucking strike which began last week in southern
Chile and has spread to the more populous central zone.
2
Government
moves to counteract the strike by jailing key union leaders, im-
pounding trucks and declaring zones of emergency appeared to stiffen
resistance and gain sympathy from other groups. Shopkeepers and
small businesses joined the strike with at least 65 percent effectiveness,
and some other professional groups (including engineers and doctors)
have publicly indicated they might follow suit. The opposition political
parties have announced their support of the strike.
While Allende has called for moderation, he has also extended the
zones of emergency, which inter alia place the military in charge of law
enforcement, to seventeen of Chiles twenty-five provinces including
almost three-quarters of the national population. The strike has had a
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret.
2
A nationwide truckers strike began on October 10 and grew into a protest against
the UP government. According to the report of the Senate Select Committee to Study Go-
vern-ment Operations with Respect to Intelligence Activities (Church Committee), anti-
government strikers were actively supported by several of the private sector groups
which received CIA funds. When the CIA learned that one private sector group had
broken the Agencys ground rules and passed $2,800 directly to the strikers, the Agency
protested, but continued passing money to the group. (Covert Action in Chile, p. 31)
378-376/428-S/80023
November 5, 1970December 31, 1972 825
noticeable effect on the distribution of food, especially bread, and fuel.
Violence has been kept to a minimum, and as of Sunday, October 15,
activities in Santiago appeared to be generally normal. The next day or
two may tell whether the momentum generated by the strikes will
grow or dissipate, and whether the outlines of some accommodation
will begin to appear.
Assessment
We believe that the chances are about 6040 in favor of an accom-
modation between the opposition and the government that will avoid a
confrontation so acute as to bring about a military take over.
The current crisis has proceeded toward confrontation as far as it
has in spite of general expectations that the relaxation of the tensions
which had peaked in mid-September might prevail until the final mo-
ments of preparation for the March 1973 Congressional elections. The
accumulation of pressure on the government through the truck
owners strike and the businessmens sympathy strikes occurred with a
spontaneity which left the opposition parties being towed along in the
wake of events.
The military, which witnessed without any particular reaction the
September ouster of the plotting General Canales,
3
has no discernible
desire for a confrontation which could force it into taking control of the
government. Under the often-used provisions of the state of emergency
laws, now extended to the unprecedented number of 17 of Chiles 25
departments, the military has responsibility for maintaining law and
order and vital services. We believe that the paramount objective of the
military will be to discharge its emergency responsibilities with min-
imum trouble and turn the situation back to constituted civil authority.
In order to do this it will exercise its considerable power of persuasion
on both sides to moderate their positions, and to the extent possible will
limit its physical repression to the small minority of extremists at each
end of the spectrum.
The opposition is not, and probably cannot quickly become, orga-
nized in any systematic way to seize power from the government on its
own, but can only hope that its manifestations of massive protest will
oblige the military to take over and dictate a turn-around in the gov-
ernments political-economic program.
The government must take care that its handling of the protests
does not provoke such widespread and energetic reaction as to justify a
military take-over.
3
Canales resigned on September 21.
378-376/428-S/80023
826 Foreign Relations, 19691976, Volume XXI
Thus, the outcome rests on a three-way test of nerves, with the
government and the opposition respectively seeking to engage the mil-
itary institutions preference for accommodation in such a way as to
produce the appearance of a victory for itself.
The mere fact that opposition protest has come to this point counts
against the government, and the vigor of the opposition protest and the
reluctance of the military to see a showdown may oblige the gov-
ernment to make some significant concessions. It is possible, however,
that the government and its backers, carefully but significantly brand-
ishing their traditional threat of civil war, may exhaust the endurance
of the opposition and bring the country back to a semblance of nor-
mality, enabling it to claim victory over the strongest pressure the op-
position has yet mustered.
The matter of contingencies which could arise in conceivable
post-coup situations and which could call for U.S. policy decisions is
under examination and will be taken up in the Ad Hoc Inter-Agency
Working Group on Chile.
Theodore L. Eliot, Jr.
4
4
Miller signed for Eliot above Eliots typed signature.
312. Memorandum for the Record
1
Washington, October 17, 1972.
SUBJECT
Meeting on Current Chilean Situation at Department of State, 16301830, 17
October 1972
ATTENDEES
Assistant Secretary of State for Inter-American Affairs Charles A. Meyer
Deputy Assistant Secretary of State for Inter-American Affairs John H. Crimmins
Mr. William J. Jorden, Senior Staff Member of the National Security Council
Mr. John W. Fisher, Director of Bolivian/Chilean Affairs, Department of State
Mr. James R. Gardner, Chief, Operations Policy Staff, Department of State
Mr. Theodore G. Shackley, Chief, WH Division
Mr. [name not declassified]
1
Source: Central Intelligence Agency, Executive Registry, Job 80B01086A, Box 12,
Subject File, Chile. Secret; Sensitive. Drafted on October 18.
378-376/428-S/80023
November 5, 1970December 31, 1972 827
1. Mr. Meyers purpose in calling the meeting was to consider as a
contingency, what the U.S. Governments response should be if the op-
position to Allende were to approach the Embassy or Station in San-
tiago with a request for (a) support in toppling the Allende gov-
ernment, or (b) an assurance of post-coup support as a prior condition
for undertaking a coup, or, (c) U.S. Government commitment to post-
coup support for a coup already arranged and decided upon. Since
time would probably be a factor in responding to any such request, the
Department of State felt it was necessary to have at least some prelimi-
nary discussion of the problems and options involved in this type of
contingency.
2. Mr. Shackley noted that, earlier in the day, appropriate CIA ele-
ments had brainstormed the current Chilean situation from every con-
ceivable angle. This had resulted in the conclusion that the most likely
outcome in the current crisis was that a coup would not develop within
the next few days. This conclusion was based on the estimate that the
country would have to suffer a little more under Allende before the
kind of consensus which would provoke the military into deciding on a
coup would be reached among the main elements of the opposition
that is, the military, the political parties, and the private sector. It was
stressed that up to 17 October, there had been absolutely no indication
that General Carlos Prats, the Chilean Army Commander-in-Chief, was
ready to do anything except maintain law and order and, in the
process, support the constitutional Allende government. The point was
also made that it was fairly obvious that the opposition political parties
were reluctantly caught up in this wave of strikes and other actions
against the government; essentially they started out supporting the
strikes in order to preserve their credentials in the opposition. The pri-
vate sector, in instigating the strikes which led to the current situation,
had, and have, no clear goals but felt this was the only way to create a
situation in which the military and the political sectors would be forced
to consider a coup against the Allende regime. Mr. Shackley concluded
his assessment by stating that it is, of course, always possible that some
action which could not be reasonably anticipated might take place and
act as a catalyst for moving the military into a coup effort. As an ex-
ample of this type of unforeseen occurrence he mentioned a clash be-
tween the security forces and students in which a number of students
were killed. Short of that, however, the coup probabilities seemed quite
low at this juncture. Mr. Shackley noted that in the course of the CIA
brainstorming session, various courses of action had been examined to
see if it were in the net interests of the United States to accelerate cur-
rent Chilean events leading toward a coup. The conclusion was that no
course of action which could be taken would help in a decisive manner
to achieve the objective of removing Allende from power.
378-376/428-S/80023
828 Foreign Relations, 19691976, Volume XXI
3. It was conceded by all that, in the final analysis, the Chilean mili-
tary were the key to any coup that might develop now or in the future.
Mr. Meyer dwelled on the question of what should the U.S. Govern-
ments reaction be to a query from the Chilean military on support
under any of the possible coup-related circumstances in which this
issue might be raised. Mr. Shackley indicated that, basically, what he
felt the military would probably want in the aftermath of a coup would
be: first, military hardware in order to sustain the takeover and main-
tain law and order in the face of reaction on the part of the radical UP
supporters; secondly, financial assistance to achieve a level of liquidity
which would permit the new government to function effectively; and,
thirdly, the more traditional forms of aid in terms of food, loans, and so
on, but on an accelerated basis. There was considerable discussion with
Mr. Crimmins on the order of priority of the first two items listed by
Mr. Shackley. In this connection, Mr. Shackley indicated that one of the
prime military concerns would be what the MIR and radical wing of
the PS have in the way of arms and, on that basis, their capability to
generate a troublesome guerrilla situation in the rural areas, particu-
larly in southern Chile. In the face of this concern, the current and in-
creasingly critical shortage of spare parts, for such basics as tanks and
communications, as well as the need for transportation to shift units
around rapidly, could well be one of the early things to come up in any
discussions with the military on post-coup support. In this connection,
Mr. Shackley asked Mr. Crimmins if the Department would consider it
appropriate to give a new military government the names and ad-
dresses of MIR and radical wing PS members in order to assist them in
rolling up these elements as quickly and thoroughly as possible. Mr.
Crimmins indicated that he would definitely be against that kind of
U.S. Government support to a military junta.
5. The possibility of assistance being provided by countries other
than the United States was discussed at some length. Several partici-
pants, including Mr. Shackley, felt Brazil would be willing to help the
Chilean military in a post-coup situation, but Mr. Crimmins tended to
discount Brazils willingness to do so because of its political sensitivity
to possible charges of having sponsored the coup. The possibility of
various Western European countries or Japan assisting the Chilean mil-
itary in this type of situation was also discussed and discounted. In the
end it was the consensus that it would probably be most prudent to as-
sume that the U.S. Government would have to shoulder the immediate
support of a new Chilean government on its own and without collateral
assistance.
6. The group finally did agree on the following:
a. If and when the Chilean military decided to undertake a coup,
they would not need U.S. Government assistance or support to do so
378-376/428-S/80023
November 5, 1970December 31, 1972 829
successfully nor are they likely to seek such support. Further, given the
Chilean military capabilities for an unaided coup, any U.S. intervention
or assistance in the coup per se should be avoided.
b. The Chilean military are more likely to seek advance assurance
on the type of assistance the U.S. Government is prepared to provide
for a new government in the post-coup era. In considering this latter
possibility the Department of State representatives were ambivalent
and concerned about the degree of complicity the U.S. Government
might assume for the coup under such circumstances (particularly, if
assurance of post-coup support were an implied or specific condition
for the military to undertake the coup). The White House and CIA rep-
resentatives had a more positive outlook on this point than did the De-
partment of State since, among other things, a degree of complicity is
already inherent in the support presently being given the political op-
position in Chile. (Mr. Jorden felt that the White House reaction to a
Chilean request for assistance would be quite forward-leaning.) The
Department of State felt it could probably support a statement to the
military which would indicate that the U.S. Government bases its rec-
ognition policy on governments as they are and that, if the Chilean mil-
itary had power, the U.S. Government would be helpful. Mr. Shackley
said that CIAs reading of the Chilean psychology was that they want
to know in advance that they are operating with a sure thing and, on
that basis, the Chilean military very probably would want reasonably
specific and definite assurances of the type of support they could ex-
pect from the U.S. Government in the post-coup era. The discussion on
this point ended inconclusively, but it was agreed that the group would
take it up again at a later date.
6. Assuming a coup under any circumstances, there was a long dis-
cussion on what kind of support and assistance could be provided a
Chilean military government, given the legal and other constraints
facing the administration. Copper and other nationalization programs
of the Allende government (which it was generally agreed that a new
military government could not easily disavow) would be particularly
troublesome since they generate all sorts of technical and legal inhibi-
tions under the Hickenlooper and Gonzalez Amendments.
2
It was
agreed that even with the best of will and support on the part of the
White House, Department of State, Department of Defense, and other
2
The Gonzalez Amendment placed additional restrictions on the amount of foreign
aid dispersed to nations responsible for expropriation. This amendment, passed in March
1972, required the President to instruct representatives to vote against the dispersal of all
foreign loans to nations in violation of the Hickenlooper Amendment and substituted a
series of more specific requirements in place of the more vague appropriate steps out-
lined in that amendment. (See Foreign Relations, 19691976, vol. IV, Foreign Assistance;
International Development; Trade Policies, 19691972, Document 148.)
378-376/428-S/80023
830 Foreign Relations, 19691976, Volume XXI
interested agencies, real difficulties would be encountered in providing
the range and tempo of assistance needed by, and possibly promised
to, the new government. Mr. Meyer indicated that, in order to establish
precisely what technical difficulties would be encountered and how
they might be overcome, he had convoked on 17 October the working
level members of the Ad Hoc Committee on Chile. He indicated that
the Ad Hoc Committee on Chile would remain in session until it had
examined all possibilities for assisting a post-coup Chilean government
in the wider and less sensitive context of any type of government which
might succeed Allende under any type of circumstances.
Theodore G. Shackley
3
Chief
Western Hemisphere Division
3
Printed from a copy that bears this stamped signature.
313. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Deputy Assistant for
National Security Affairs (Haig)
1
Washington, October 17, 1972.
SUBJECT
Contingencies in Chile
We had an ad hoc meeting this afternoon (Charlie Meyer, ARA
types, INR, CIA) to discuss developments in Chile.
2
CIA has studied all
incoming reports and concludes that the chances are 6040 against mili-
tary intervention or a coup. (My experience is that 6040 means you are
certain something wont happen, but you dont want to be too wrong if
it does.)
The specialists believe that things will have to go considerably
more sour, or that there would have to be much loss of life and vio-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret; Sensitive; Outside System. Sent for
information. A copy was sent to Kennedy. Across the first page of the memorandum,
Haig wrote, Bill shouldnt we consider WSAG now to be sure were on top of thiswhat
does Kennedy think?
2
See Document 312.
378-376/428-S/80023
November 5, 1970December 31, 1972 831
lence, before the Chilean military felt compelled to intervene. It is also
widely believed that they will not move against the government itself
unless there is some flagrant violation of constitutional norms. The
time frame for the above estimate is the next week or so.
However, if things continue to go downhill, or if there were a
wild card event (massive violence, bombings, etc.), the military
might reach the conclusion that only by acting could they save their
country or prevent total disruption or massive loss of life. In that case
if they decide to intervene or to carry out a coupthe estimate is that
they would not seek or direct assistance in that action. It was also the
consensus that it would not be in their interest, or in ours, to have any
direct U.S. participation or complicity.
Other possible contingencies are:
if they decide that action is required, the military might well
simply assume that they could count on U.S. friendship and coopera-
tion after the fact;
they might decide to act, but come to us first to inquire what our
policy would be if they took power;
or they might come to us, say they were ready to act, but felt
they could not do so without having assurances of help from us. (We
think that any request for help would focus first of all on: food, loans,
arms, especially spare parts and transport.)
It was agreed to do more thinking on these and other possibilities.
It was agreed that an early SRG meeting might be useful for all
concerned.
Meantime, we should be aware that there are limitations on what
we could do to help Chile under the above circumstances. There are
heavy demands on our grain supplies. We have limits on funds for all
purposes. Moreover, there are restrictionsin the form of the Hicken-
looper and Gonzalez amendmentsbecause Chile has not made any
payments for nationalized properties (especially copper).
3
Also, there is
no provision for grant military aid to Chile.
A group of specialists from State, Defense and other agencies
began work today surveying just what we could and could not do to
help Chile if there were a sudden change of government and a policy
decision here to do all we could to help.
That is the current state of play. I am following it closely.
3
See footnote 2, Document 312.
378-376/428-S/80023
832 Foreign Relations, 19691976, Volume XXI
314. Memorandum From Secretary of State Rogers to
President Nixon
1
Washington, November 15, 1972.
SUBJECT
Allendes Visit to the United Nations
Through press leaks and indirect feelers in Santiago and from in-
formation obtained from a member of the Chilean delegation to the
United Nations, it seems clear that the Government of Chile is fishing
for an invitation for Chilean President Salvador Allende to meet with
you during his intended visit to the United Nations General Assembly,
probably in early December. The Chilean U.N. delegation source said
that the real purpose of Allendes trip was to meet with you to discuss
serious bilateral problems at the highest level, and that the tenor of Al-
lendes speech at the U.N. would reflect the way in which the U.S. Gov-
ernment responded to his request for a meeting.
2
The central bilateral problem between the United States and Chile
is Chiles uncompensated expropriation of large U.S.-owned invest-
ments. The Chilean Government has taken the position that interna-
tional law does not regulate the payment of compensation and that
controversies relating to compensation are subject exclusively to its in-
ternal jurisdiction. Despite a commitment by Chile in the Paris Club
Memorandum of Understanding of April 1972 to enter into direct ne-
gotiations to determine appropriate financial arrangements for the
payment of all debts of the Government of Chile and to find a prompt
solution to problems which may arise as regards payments of compen-
sation between the Government of Chile and the governments of inter-
ested countries or their nationals, the Chilean Government has been
equivocal in its response to our urgings to comply with the Paris Club
commitment. The Chilean Government, whose credit-worthiness in
Western financial sources is virtually nil because of its own economic
and financial policies, has accused United States imperialism of de-
liberately withholding resources to which Chile is entitled. It has
charged the Kennecott Copper Corporation with waging illegal eco-
nomic aggression against Chile, for having begun litigation in Euro-
pean courts on Chilean Government copper shipments in an effort to
recover compensation for its expropriated properties. (Decisions by the
1
Source: National Archives, RG 59, Central Files 197073, POL 7 CHILE. Secret. A
typed notation on the top of the page reads, Per call [illegible] Amb. Bush is to call on
Allende while in N.Y.; courtesy call only. 11/25/72.
2
As reported in telegram 4686 from USUN, November 15. (Ibid.)
378-376/428-S/80023
November 5, 1970December 31, 1972 833
Chilean special copper tribunal have denied Kennecott any effective ju-
dicial remedy in Chile against a presidential finding on excess profits
which eliminated any possibility of compensation.)
3
We believe that Allendes purpose in seeking a presidential
meeting in the United States is to elevate his own prestige at home and
abroad, thereby strengthening his government and weakening his do-
mestic opposition.
4
There is no evidence on which to base any expectation that Allende
is prepared to offer meaningful concessions with respect to his gov-
ernments position against compensating the major expropriated U.S.
investors in Chile, nor any strong reason to believe that he could de-
liver on such concessions as he might promise, over the resistance of
powerful hardline elements in his coalition. We expect that he would
plead for termination of the Kennecott litigation on the Chilean copper
shipments and for new flows of resources from international financial
institutions in which the U.S. Government has influence.
The benefit of a presidential meeting would go to Allende in
heightened prestige at home and elsewhere, with little or no concrete
progress likely on the central issue of compensation or on Allendes
policies.
Therefore, we believe that, if we receive a concrete inquiry from
the Chilean Government about a presidential meeting, our position
should be that it is impossible for scheduling reasons for you to receive
Allende. We might suggest as an alternative that Ambassador Bush or a
Departmental official meet with Allende in New York.
5
Ambassador
Davis concurs in this view.
William P. Rogers
3
On August 11, the Special Copper Tribunal released its decision denying Kenne-
cotts appeal of Allendes ruling on Kennecotts excess profits. The tribunal denied An-
acondas appeal on September 8.
4
In a November 23 meeting with Davis in Santiago, Letelier made a strong appeal
for an invitation to Allende to visit Washington or to meet Rogers or Kissinger in New
York. Letelier described the Allende trip as a crossroads, a critical opportunity that the
United States should take to preserve its relations with Chile from serious damage. Tele-
gram 5921 from Santiago, November 23, is Foreign Relations, 19691976, vol. E16, Docu-
ments on Chile, 19691973, Document 125.
5
On November 17, Kissinger approved a meeting between a U.S. official and Al-
lende. On a memorandum from Jorden that was forwarded to Haig, Kissinger wrote,
Make sure Pres. recommendation for approval is no one above Asst. Sect. In an at-
tached memorandum to the President, Kissinger recommended Ambassador to the
United Nations George H.W. Bush, or an official of the State Department. (Memo-
randum from Jorden to Kissinger, November 17; National Archives, Nixon Presidential
Materials, NSC Files, Box 776, Country Files, Latin America, Chile, Vol. VII; and memo-
randum from Kissinger to Nixon, undated; ibid.) A December 4 telegraphic report of
Bushs discussion with Allende is Document 315.
378-376/428-S/80023
834 Foreign Relations, 19691976, Volume XXI
315. Telegram From the Department of State to the Deputy
Secretary of State (Irwin) in Paris
1
Washington, December 4, 1972, 2250Z.
Todep 3/219389. Subject: Conversation with President Allende.
Following is a memorandum of conversation between President
Allende and Ambassador Bush, USUN:
Quote: I met with President Allende, Amb Santa Cruz and Amb
Diaz Casanueva and one interpreter for about 40 minutes on December
3. Amb Diaz Casanueva called me at 10:25 p.m. and said that the Presi-
dent would be willing to receive me now. I had no time to get an in-
terpreter or notetaker.
We met in the small sitting room at the end of the 26th floor of the
Waldorf at 10:30 p.m. President Allende, speaking through an inter-
preter, appeared relaxed. We exchanged pleasantries. He commented
that he could not stay longer in our country because of the law in Chile,
stating that a chief executive officer must have permission of the Senate
to be out of the country more than 15 days, and that he himself was
leader of the Senate when President Frei was turned down on a request
to be away more than 15 days. He mentioned that he would go to Al-
geria. I asked about his itinerary, saying I understood it was Algeria,
Moscow and home. He said, No, Algeria, Moscow, Cuba, probably
Venezuela, and then home.
He said he would like to have a frank discussion and he then men-
tioned several of the difficulties between us. One was the Easter Island
incident. He said that four days before he took over as President cer-
tain instruments important to Chile were removed from the weather
station. He felt this was an unfriendly act. He mentioned the Enterprise
incident stating that the Admiral had said that a visit would be in order
and that it would have been good for the Enterprise to stop in Chile; but
then the plans had been cancelled.
2
The 3rd incident he mentioned involved statements by certain
government officials. He said that those officials would not go to Chile
because the Government of Chile would fall within six months.
I asked him if it would be all right to talk frankly, recognizing that I
was an Ambassador and he was a Chief of State. The President ex-
plained that he would like to have a frank dialogue between equals. He
was direct and quite persuasive on this point. I said that since he had
1
Source: National Archives, RG 59, Central Files 197073, POL 151 CHILE. Confi-
dential; Immediate. Drafted by Fisher. Repeated immediate to Santiago.
2
See Documents 160 and 207.
378-376/428-S/80023
November 5, 1970December 31, 1972 835
mentioned the difficulties as he saw them between the United States
and Chile that I would like to mention one principal difference. I told
himthat I had lived in various parts of the United States, that I found an
affection for Chile on the part of our people all over the country and a
desire for more friendly relations. I told him that we did not consider
ourselves imperialists, that we did not recognize that people were
correctly identifying us when we were termed imperialists, and that we
still had a deep conviction that our free enterprise system was not
selfish but was the best systemcertainly for us, though we had no in-
tention to insist on it for others. And when it went abroad it did not
bleed other people. I said there may have been excesses from time to
time but basically the American people believe deeply in free enter-
prise and in capitalism and in investment, not in a selfish sense but be-
cause we felt that it was the best way to provide a better standard of
living for all. Thus we felt that, though any country was free to have
whatever kind of system it wanted, in my opinion the main stumbling
block between our countries was the question of just compensation for
expropriated properties.
The President did not seem irritated. He saidI would like to take
exception to what you have said, and he said I would like to refer you
to Senate hearings held by a Senate Subcommittee which indicated that
what you have said is not correct. I asked him who the chairman of this
Senate Subcommittee was and he said these hearings were held in 1952.
He also mentioned that he had a letter from Nelson Rockefeller
giving him credit for a health plan for all of South America. (I was not
quite sure what this had to do with anything.)
During our talk there was no mention of any specific company.
The President did say that the government was one thing, the people
were one thing and the corporations were something else. He never
used the word multinational but it was clear that he was differenti-
ating between the Government of the United States, the people of the
United States and the multinational companies. I told him that because
of our deep conviction in the free enterprise system, the people, the
government and the system were all interlocked, and that in my own
personal opinion it was impossible to separate them out because of our
conviction that our system was right for us.
Ambassador Casanueva interpreted and asked me to repeat to
President Allende the toast he, the Ambassador, had given to me at a
dinner given by Ambassador Vinci in which he had called me his
favorite imperialist. (The Spanish at the time was sympatico
imperialista.)
I repeated this to the President and at the same time said that as
long as he permitted me to be frank, I should tell him that one of the
most difficult parts of my job since coming to the UN had been recog-
378-376/428-S/80023
836 Foreign Relations, 19691976, Volume XXI
nizing that it was our country people were talking about when they
talked about imperialists. We did not want to impose our system on
others. I made clear that I was flattered by Ambassador Casanuevas
toast which he had delivered in a friendly vein, but at the same time I
told the President that many countries labeled us imperialists and we
Americans did not accept this definition of ourselves. Casanueva then
made some reference to Abraham Lincoln whom he was going to quote
tomorrow before the General Assembly.
The President again encouraged me to speak frankly and I told
him in my judgment one of the main irritants was the question of com-
pensation for properties expropriated. I told him that I thought the
question of expropriation was one thing, but that the main irritant was
the question of failure to compensate promptly and fairly. President
Allende did not reply to this nor did he want to go deeper into the ques-
tion of multilateral corporations. I told him I was honored to be re-
ceived by him and that I wished him a good stay in our country. He
thanked me for the arrangements and for the details on the visit.
During the walk down the hallway, there was some reference to
his speech tomorrow in a conversation between him and his Ambas-
sadors. One of the Ambassadors said to me: Are you going to have a
right of reply? This was then taken up by President Allende. I said
there had been precedence for rights of reply to Chiefs of State, but they
were exercised under most unusual circumstances. The President said
jokingly, I will send you a copy of my speech tonight. Then you can
prepare your right of reply. I indicated that I hoped his speech would
not require a right of reply on the floor. There seemed to be a nodding
of heads and an agreement of Ambassadors on this point.
3
At that minute the interpreter started to translate, but Santa Cruz
interrupted and translated instead. The interpreter told me that Santa
Cruz said that he is familiar with this and therefore he would translate.
The President rather notably did not make any comment about the
forthcoming bilateral talks at all. During part of the conversation when
the President referred to the difficulties and mentioned Easter Island,
the carrier Enterprise and statements by government officials, Amb.
Santa Cruz or Amb. Casanueva (I cant remember which) mentioned
the word Herrera, presumably referring to the unacceptability of
Herrera as a candidate for Secretary General. Even though it was men-
tioned to the President by the Ambassador, the President did not
choose to raise this matter with me.
3
In his December 4 speech before the General Assembly, Allende charged that
Chile was the victim of serious agression by U.S. corporations and by the U.S. Govern-
ment. Bush held a press conference immediately after the speech. (Robert Alden, Al-
lende, at U.N., Charges Assault by U.S. Interests, NewYork Times, December 5, 1972, p. 1)
378-376/428-S/80023
November 5, 1970December 31, 1972 837
Allende gave me several very firm handshakes, looked me directly
in the eye, seemed to go out of his way to be warm and friendly.
I particularly think back nowto his discussion of dialogue between
men, that he liked frank discussion and that he wanted me to be very
frank with him. I made the obvious disclaimers about being a mere
Ambassador while he was a Chief of State, at which point both Ambs.
Santa Cruz and Diaz Casanueva gave me quite a build-up. Allende
then replied that he knewa good deal about me, how old I was, etc., etc.
I am sure this reflects somewhat on their briefing process.
The President wore a quasi-Mao jacket. As soon as we sat down,
somebody passed out scotch. The President took a scotch on the rocks
with a little bit of water. He did not smoke during the interview. He
looked well, and mentioned with some satisfaction his hectic, but I
gather satisfying, trip to Mexico.
In the beginning of the conversation I made some opening com-
ments about friendship of the American people for Chile, wanting
better relations, and the hope that this would result in better times
ahead. I mentioned specifically the upcoming December bilateral talks,
saying I was not up to date on the details of all the issues involved be-
tween our countries, and that, like Amb. Diaz Casanueva, we concen-
trated on UN matters.
4
4
Printed from an unsigned copy.
316. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, December 15, 1972.
SUBJECT
US/Chilean Bilateral Talks
Bilateral talks between the U.S. and Chile are to be held at the De-
partment of State beginning December 20. The U.S. delegation will be
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 776,
Country Files, Latin America, Chile, Vol. VII. Secret. Sent for information.
378-376/428-S/80023
838 Foreign Relations, 19691976, Volume XXI
headed by Assistant Secretary of State for Inter-American Affairs
Charles A. Meyer.
Background: Following a unilateral moratorium on its external debt
payments by Chile in November 1971, Chiles 12 major creditor nations
met in Paris in April 1972 and agreed to reschedule approximately $160
million of debt owed them by Chile from November 1971 through De-
cember 1972.
After strenuous negotiations the U.S. succeeded at Paris in having
the multilateral agreement include clauses in which the Government of
Chile agreed to recognize and pay its debts, to carry out direct negoti-
ations for the purpose of finding a prompt solution to problems in-
volving compensation for expropriated properties, and to grant just
compensation in accordance with Chilean legislation and international
law.
The refusal of the special Chilean Copper Tribunal to review Presi-
dent Allendes findings against Kennecott and Anacondas alleged
excess profits effectively foreclosed any local Chilean resolution of the
problem of compensation for the major copper investments. Following
this, the USG in a note of September 15 asked the Government of Chile
to enter into direct negotiations with the companies on copper compen-
sation in accordance with its Paris Club commitment. The Chilean
reply of October 18 was polemical in tone and indicated that the GOC
considered that its domestic legal processes conformed with interna-
tional law. Nevertheless, the Government of Chile offered to enter into
wide ranging discussions in Washington, through its Ambassador, on
the questions affecting relations between the two countries. In our re-
sponse of November 22 we proposed that such talks begin during the
week of December 11. These are the talks which are now to begin on
December 20. Our note outlined, in a firm but unpolemical tone, the
U.S. position on obligations under international law on compensation
for expropriated investment and made it plain that we intend to
discuss the copper expropriation in the proposed talks. In reply,
Chilean Foreign Minister Almeyda told Ambassador Davis that the
GOCis prepared to make a strong effort to achieve an understanding
at these meetings.
The USG Purpose and Objectives in the Upcoming Talks: Our purpose
in these talks is to establish a forum for frank discussions on the imple-
mentation of Article 4 of the Paris Club Agreement calling for direct ne-
gotiation in regard to payment of compensation and to keep the door
open to dialogue, while the cumulative effect of various pressures on
the Government of Chile has a chance to influence Chilean actions. We
will deal with the larger questions of expropriation and compensation
while recognizing that these relate to the question of bilateral debt re-
scheduling which is being dealt with in other channels.
378-376/428-S/80023
November 5, 1970December 31, 1972 839
In pursuit of our objectives, we intend to indicate our willingness
to discuss any issue that the Chileans might raise in these talks without
compromising our basic principles or allowing the talks to bog down in
matters not related to the central issues of debt and compensation. We
plan to emphasize the need for progress on concrete issues which the
USG cannot ignore or abandon: (a) acknowledgement of all contractual
debt obligations, including the balance of $8.1 million owed Kennecott
and the $150 million in CODELCO notes owed Anaconda; (b) some for-
mula for arriving at a positive compensation figure for the expropri-
ated equity in the three larger mines.
378-376/428-S/80023
That Chilean Guy May Have Some Problems:
The Downfall of Salvador Allende,
JanuarySeptember 1973
317. Memorandum
1
Washington, January 11, 1973.
SUBJECT
Approval to Expend [dollar amount not declassified] Set Aside by the 40 Committee
for Support of [1 line not declassified] During January and February 1973
1. On 26 October 1972 the 40 Committee approved a memorandum
authorizing the expenditure of $1,427,666 to support four political
parties and three private sector organizations during the period pre-
ceding the 4 March 1973 congressional elections in Chile.
2
This ap-
proval was granted with the provision that the precise timing of assist-
ance [1 line not declassified] be subject to Department of State and
National Security Council concurrence.
2. It is proposed that the [dollar amount not declassified] approved by
the 40 Committee for [less than 1 line not declassified] be used during Jan-
uary and February 1973 to help the [1 line not declassified] mount a get-
out-the-vote campaign. These organizations have already voted to un-
dertake such a campaign, but need funds to pay for publicity, transpor-
tation and other costs incidental to this effort.
3. Funds to support this get-out-the-vote campaign would be chan-
neled through a trusted [less than 1 line not declassified] asset [5 lines not
declassified]. Use of this asset as a cut-out would effectively conceal any
U.S. Government sponsorship of this effort.
4. [9 lines not declassified]
5. [name not declassified] will be unwitting of the ultimate source of
the funds, and will be told by our asset that those contributing to this
1
Source: National Security Council, Nixon Intelligence Files, Subject File, Chile
1973. Secret; Sensitive; Eyes Only. This summarizes a more detailed January 11 memo-
randum from the Chief of Station to Davis. See Document 129 in Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973. A January 11 covering memo-
randum from Shackley to Meyer, requested Meyers and Daviss concurrence with
passing [text not declassified] for a get-out-the-vote campaign. A January 11 memorandum
from Shackley to Jorden requested Jordens support to spend the money. Jorden con-
curred in an attached January 19 memorandum to Shackley. (Both in the National Secu-
rity Council, Nixon Intelligence Files, Subject File, Chile 1973)
2
The memorandum for the record is Document 121 in Foreign Relations, 19691976,
vol. E16, Documents on Chile, 19691973.
840
378-376/428-S/80023
JanuarySeptember 1973 841
campaign desire to remain anonymous in order to avoid any possibility
of government reprisal. [name not declassified] will be asked for regular
accountings to insure that funds are being provided only to those [less
than 1 line not declassified] organizations which are actively and effec-
tively supporting the get-out-the-vote campaign.
6. The above proposal has the concurrence of Ambassador Davis
and his Deputy Chief of Mission, Harry Shlaudeman, who commented
that the proposal appears to have adequate security safeguards and
could be helpful in reaching voters who are normally inaccessible to
political parties.
3
3
On a January 15 memorandum from Meyer, Johnson initialed his approval on Jan-
uary 18 for the passing of the funds. (Department of State, Bureau of Intelligence and Re-
search, INR/IL Historical Files, Chile, 40 Committee Action after September 1970)
318. Memorandum From the Executive Secretary of the
Department of State (Eliot) to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, January 15, 1973.
SUBJECT
Bilateral Talks with Chile, December 2022, 1972
Throughout the talks, we insisted that the fundamental issue be-
tween the two governments was payment of the repudiated debt and of
just compensation for expropriated property, and we called on the
Chileans to present concrete proposals to resolve this issue.
The Chilean delegation raised other issues such as the continued
lack of a bilateral debt rescheduling agreement for 1972, the legal ac-
tions brought by Kennecott against Chilean copper shipments in
third-country courts, and the question of Chilean access to the re-
sources of the international financial institutions. They contended that
any solution on compensation must conform with the Chilean constitu-
tion and domestic legislation, and flatly rejected any notion of negoti-
ating a pre-conceived compensation agreement, citing domestic legal
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Confi-
dential. Drafted by Girdler; cleared by Fisher, Meyer, Crimmins, Feldman (draft), and
Weintraub (draft). Documentation on the bilateral talks is ibid., INCO 152 CHILE.
378-376/428-S/80023
842 Foreign Relations, 19691976, Volume XXI
and political obstacles. They repeatedly stated the GOCs desire to
normalize bilateral relations and suggested both sides seek a path
to a solution.
Toward the end of the talks, the Chileans raised the possibility of
recourse to a third-party mechanism. In this regard they mentioned the
1914 bilateral Treaty for the Pacific Settlement of Disputes, or some
other mechanism. To guard against Chiles using some inadequate de-
vice as a means of regularizing its situation with other creditors, partic-
ularly the international financial institutions, we emphasized the im-
portance of a solution which would provide adequate compensation,
and made clear we were not interested in agreeing on a mechanism
simply as a face-saving device.
The Chilean delegation pointed out that its reference to third-party
mechanisms represented a significant and difficult departure from
Chiles position that it has exclusive domestic jurisdiction over expro-
priation. This departure, and the stress placed by the Chilean delega-
tion on normalization of relations with us, tend to indicate that the
GOC may have reached an internal decision to seek some kind of ac-
commodation with us. Such a decision could have been encouraged by
Moscows reportedly cautious response to Allendes appeal for assist-
ance during his recent visit there. Whether the GOC is really prepared
to pay the political and financial costs required for a genuine solution
remains to be seen.
We and the Chileans agreed to meet again at a date to be deter-
mined. We are currently considering what timing would appear most
advantageous to our interests as well as the pace and direction we
would want the talks to take in the future.
Theodore L. Eliot, Jr.
2
2
Miller signed for Eliot above Eliots typed signature.
378-376/428-S/80023
JanuarySeptember 1973 843
319. Memorandum From the Acting Assistant Secretary of State
for Inter-American Affairs (Crimmins) to the Under Secretary
of State for Political Affairs (Porter)
1
Washington, February 9, 1973.
SUBJECT
Additional Funds for Chilean Opposition for March Elections
In the attached memorandum to the 40 Committee CIA requests
an additional [dollar amount not declassified] to support the political op-
position in Chile in the campaign leading to the 4 March Congressional
elections.
2
Ambassador Davis has endorsed the proposal.
The latest authorization by the 40 Committee for this purpose was
in October 1972, when $1,427,666 was approved.
3
The current request is
designed to compensate for subsequent adverse developments, princi-
pally a sharp rise in prices affecting the cost of such things as campaign
material, media advertising, and transportation, coupled with a short-
fall in funds that the Christian Democrats had been promised by [less
than 1 line not declassified].
4
Of the sum requested, [dollar amount not declassified] would go to
each of the two leading opposition parties, the Christian Democratic
Party (PDC) and the National Party (PN), and [dollar amount not declas-
sified] would go into a contingency fund for use with individual candi-
dates of all opposition parties in cases where it appeared that financial
help could make a critical difference.
ARA and INR believe the request should be granted. It is of course
not possible to state with precision the extent to which our aid to the
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
1973. Secret; Sensitive; Eyes Only. Drafted by Gardner and sent through McAfee for the
INR Director.
2
The attached February 8 memorandum to the 40 Committee is published in For-
eign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Document 130.
3
See footnote 3, Document 317.
4
Covert USG support for the opposition since Allende took over the Government
of Chile has run something over [dollar amount not declassified]. Of this sum, over [dollar
amount not declassified] has been used to support the principal opposition newspaper and
the remainder, including [dollar amount not declassified] for three congressional by-
elections, has been used to help opposition elements maintain their party organizations
through such means as support to their radio and press outlets, contributions to indi-
vidual candidates, advice on political organizing techniques, and provision of the usual
campaign paraphernalia such as poster materials, paint, printing facilities and transpor-
tation. Some money, about [dollar amount not declassified] has gone to private sector orga-
nizations to assist their activities in support of opposition political parties. [Footnote in
the original.]
378-376/428-S/80023
844 Foreign Relations, 19691976, Volume XXI
opposition has contributed to its viability and to its excellent prospects
in the present campaign, but we have no doubt that it has been an im-
portant element. As far as we can tell, the money has been used wisely,
with a minimum of waste and perceived corruption, and with no secu-
rity compromise.
The March elections will be the first general test in a vote for na-
tional offices that the competing political forces in Chile have under-
gone since Allendes assumption of office. If the opposition can come
within striking distance of the 60% of the vote total that more optimistic
predictions accord it, those influences now frustrating the Popular
Unity Governments effort to establish an irreversibly Marxist state will
be strengthened and toughened. Even a 55% total would provide a
healthy base from which to maintain an effective opposition.
We are under no illusions that a successful opposition effort in the
election would have as an inevitable consequence the preservation of
Chilean democracy; we do believe that an opposition failure could
gravely compromise Chiles future.
Recommendation
That you support the proposal for providing an additional [dollar
amount not declassified] to the Chilean opposition.
5
5
Porter initialed the Approved option. The 40 Committee approved the pro-
posal on February 12, according to a notation on the attached February 8 memorandum
to the Committee.
378-376/428-S/80023
JanuarySeptember 1973 845
320. Action Memorandum From the Assistant Secretary of State
for Economic and Business Affairs (Armstrong) and the
Assistant Secretary of State for Inter-American Affairs
(Meyer) to Secretary of State Rogers
1
Washington, February 28, 1973.
CHILENext Steps in Bilateral Talks
Background
The United States and Chile entered into bilateral discussions in
December 1972 on a wide range of issues between the two gov-
ernments, focusing primarily on the question of compensation for ex-
propriated property and debt repudiation under Article IV of the Paris
Club Agreed Minute on Chile debt rescheduling. The first round of
these discussions produced no substantive movement by the Chileans
toward a solution to the compensation issue. However, toward the con-
clusion of the discussions, the Chilean delegation suggested the invo-
cation of a third party mechanism to deal with the question of just
compensation.
This memorandum sets forth a proposed strategy on the next
round of talks, now set for March 2223 in Washington, concentrating
on further exploration of the possible use of a third party mechanism.
Chilean Tactics and Objectives
During the first round of bilateral talks, the Chilean delegation
stated that because of domestic Chilean legal, constitutional and polit-
ical constraints, bilateral negotiations could not lead to a solution of the
compensation question. The Chilean delegation suggested that the in-
troduction of a third party mechanism into the discussions, coupled
with the progress on ancillary issues such as access to the international
financial institutions, cessation of Kennecott litigations, and agreement
on rescheduling of Chiles 1972 debt service to the United States, might
provide a way out of the bilateral impasse. The specific third party
mechanism mentioned was the 1914 U.S.Chile Treaty for the Ad-
vancement of Peace, although the door was left open for other devices
we might wish to suggest.
The Chilean delegation stated that it was making a great conces-
sion in even suggesting it would submit a Chilean act of sovereignty to
review by a third party.
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Secret.
Drafted on February 26 by Fisher, Gantz, and Casse; cleared by Weintraub, Benedick,
Feldman, and Crimmins. Sent through Under Secretary of State for Economic Affairs
William J. Casey.
378-376/428-S/80023
846 Foreign Relations, 19691976, Volume XXI
We believe that Chiles objective in making this suggestion is to
improve its position with foreign creditors, including the international
financial institutions. The Paris Club and international opinion can be
expected to support third party settlement, and the IFIs are likely to
argue that if a third party settlement procedure is in process, they can
resume lending on the grounds that good faith negotiations are taking
place.
U.S. Objectives and Strategy
By the time we resume our bilateral talks the March 4 congres-
sional elections will have taken place and their results can give us a
better sense of the political climate in Chile. We will wish in any event
not to help Allende and the Popular Unity government to consolidate
their position, but at the same time to hold open the longer run possi-
bility of finding an acceptable solution to the compensation question
and recovering moneys owed by Chile.
Our primary purposes in the next session of bilateral talks are to
continue pressing the GOC for a negotiated solution to the outstanding
compensation and the repudiated debt problems; to move the Chilean
delegation as far as possible toward the definition of impartial and
binding third party procedures the GOC would accept as the means for
reaching a solution; and to continue to minimize any propaganda or
substantive advantage the GOC may seek to obtain from other cred-
itors or lending institutions as a consequence of the talks.
In seeking to achieve these purposes, we would not at this stage
propose binding arbitration under any specific mechanism (such as the
1899 Hague Convention, 1929 Inter-American Arbitration Convention,
or an ad hoc agreement), concentrating instead on questions which
would draw out the Chilean views:
(a) Can Chilean legal and political restrictions, which apparently
preclude achieving a negotiated solution, be overcome so as to permit
implementing a solution arrived at by a third party mechanism?
(b) What are the characteristics of a third party mechanism accept-
able to Chile?
(c) What specific issues would Chile be willing to submit to
arbitration?
(d) Would Chile accept a simplified, expeditious and binding
proceeding?
Chilean responses to these questions would indicate the extent of
Chilean receptivity to a meaningful third party proceeding, and the
likelihood of their accepting a binding as opposed to a non-binding
procedure (such as conciliation under the 1914 Treaty). We may wish in
later sessions to go beyond this, but we believe such judgments can be
deferred until we hear further from the Chileans.
378-376/428-S/80023
JanuarySeptember 1973 847
Other Considerations
Submission of the copper dispute to a third party mechanism
under mutually acceptable conditions has both advantages and risks
(whether the procedure is binding or non-binding). The principal ad-
vantages are:
(a) The dispute would be kept open (in contrast with IPC in Peru),
and pressure would be kept on the GOC for settlement;
(b) Submission of the dispute to third party settlement by Chile
would constitute an implicit repudiation of the Allende governments
insistent assertion that such matters are strictly within Chilean sover-
eignty (as well as a long tradition in Latin America of objection to inter-
national adjudication of these kinds of disputes), and would be a sig-
nificant step in our attempts to gain acceptance in Latin America for
viable third party procedures in lieu of unilateral action in investment
disputes;
(c) An impartial, objective third party determination could estab-
lish the obligation of a host government under international law to
compensate for expropriated properties.
Nevertheless, third party settlement offers the following risks for
the United States:
(a) During the time (1218 months) which would be required to
complete the process, some of the financial pressures on the GOC (es-
pecially through the IFIs) would be loosened;
(b) There exists a riskin our viewacceptableof an adverse deci-
sion on the excess profits or compensation issues which would have an
extremely damaging impact going well beyond the copper dispute.
An additional consideration is that if Chile should in the end insist
on utilizing the 1914 Treaty, it would be difficult to find legal grounds
for refusing. Our failure to accept could result in the breaking off of the
discussions, with the GOC in a relatively advantageous position to ex-
ploit the situation. Under these circumstances, our interests would be
better served by an attempt to so structure the 1914 Treaty procedure as
to make it expeditious and binding.
Recommendation
That you authorize further exploration with the Chileans of their
receptivity to a mutually acceptable third party mechanism for the set-
tlement of the copper dispute.
2
2
Rogers initialed the Approve option on March 9.
378-376/428-S/80023
848 Foreign Relations, 19691976, Volume XXI
321. Memorandum From the Executive Secretary of the
Department of State (Eliot) to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, March 7, 1973.
SUBJECT
Chilean Congressional Elections
The Chilean parliamentary election of March 4 resulted in practical
political terms in a continued stalemate, with both sides claiming vic-
tory. Nevertheless, the better-than-expected showing of the UP repre-
sents a psychological assist to Allende.
In the nation-wide vote to elect 150 Deputies, the opposition ob-
tained 54.7 percent of the popular vote to the Governments 43.3 per-
cent. President Allende had claimed that anything over the 36 percent
plurality he received in September 1970 would be a victory. This as-
sertion ignored for obvious reasons the fact that his Popular Unity (UP)
candidates had won 49 percent of the vote in the country-wide April
1971 municipal elections. Opposition spokesmen had portrayed the
election as a plebiscite asserting that anything over 50 percent for
their candidates would signify that a majority of Chileans reject Al-
lendes brand of socialism.
Opposition expectation of a 60 percent majority and its outside
hopes for an even larger margin that would have given them two-
thirds control of the Congress (needed to override Presidential vetoes),
did not materialize. The substantial opposition majority in Congress
was slightly reduced from 93 to 87 seats in the Chamber (150 total) and
from 32 to 30 in the Senate (50 total). The loss in seats was not en-
tirely unexpected nor is it so significant as the lower-than-expected
percentage of the total vote because of the oppositions over-
representation in the Congress dating back to the pre-Allende 1965
and 1969 parliamentary elections, and the fact that UP incumbents oc-
cupied only 9 of the 25 Senate seats which were being contested.
While the UP lost electoral support from its April 1971 highpoint,
it does appear to have consolidated its strength at the 40 percent level
essentially on urban poor and campesino support for the two Marxist
parties, Socialist and Communist. The oppositions failure to obtain a
wider margin of victory will be disappointing to those who hoped the
results would force Allende to modify decisively the pace and direction
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Confidential.
378-376/428-S/80023
JanuarySeptember 1973 849
of his revolution. The basically inconclusive outcome leaves most
participants in the Chilean political scene, including the military, in
much the same relative positions as they were in before. Chiles polit-
ical impasse will continue with the military still serving as the arbiter of
power and guarantor against violence by either side, at least for the im-
mediate future. The results will tend to reduce the prospects for vio-
lence from what might have been more frustrated UP extremists or
more exuberant opposition rightists. The election results will do
nothing to resolve or alter the countrys deepening economic crisis.
Theodore L. Eliot, Jr.
2
2
Miller signed for Eliot above Eliots typed signature.
322. Memorandum From the Executive Secretary of the
Department of State (Eliot) to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, March 16, 1973.
SUBJECT
The Church Subcommittee Hearings on Multinational Corporations: ChileITT
The SFRC Subcommittee on Multinational Corporations begins its
investigation of ITT and USG activities in Chile with an Executive Ses-
sion on Friday, March 16 at which Mr. McCone and Mr. Geneen of ITT
will testify. The focus of these hearings will be the allegation in the Jack
Anderson column in March 1972 that CIA representatives requested
ITT to take actions injurious to the Chilean economy as part of a U.S.
program to prevent the election of President Allende in 1970.
2
Six days of public hearings are scheduled, March 2022 and 2729.
Secretary Rogers and Charles Meyer have been asked to testify on
March 29 and Ambassador Korry will appear on March 27. A number
of ITT officials, other U.S. businessmen, Peter Peterson and Jack Hen-
nessey reportedly have also been requested to testify. The Committee
staff has further advised that we will receive a request to bring Ambas-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Exdis.
2
See Document 296.
378-376/428-S/80023
850 Foreign Relations, 19691976, Volume XXI
sador Vaky from Costa Rica to testify concerning his contacts with ITT
while he was on the NSC Staff and that we will be asked to produce the
file of cables between Embassy Santiago and Washington.
Charles Meyer has agreed to appear. It is expected that neither Sec-
retary Rogers nor Ambassador Vaky will testify, and we do not plan to
release the cable file to the Committee. Although we will make every
effort to avoid confrontation with the Committee, it may well be neces-
sary to request the President to invoke Executive privilege with respect
to communications with Embassy Santiago and internal proceedings of
the Government, particularly in the Forty Committee. These issues
could come to a head during Ambassador Korrys testimony on
March 27.
CIA is attempting to work out a procedure with Senator Church to
answer written questions in writing.
ITT has requested consultation with the Department with respect
to its testimony as to the CIAITT conversations. CIA counsel have
been in touch with ITT counsel and we have suggested to CIA that they
respond to ITTs request for consultation in that channel.
A central question is OPICs decision whether to pay ITTs $92.5
million claim for the OPIC insured assets of its Chile Telephone Com-
pany taken over by the Allende government. OPIC management pro-
poses to deny the claim on the grounds that ITT activities disclosed by
the so-called Anderson papers were in breach of its contract and prej-
udiced OPICs rights. The company presumably would resist such a
finding in arbitration on the theory that it did nothing improper in
Chile, that it rejected the suggestions allegedly made to it by USG offi-
cials or, alternatively, that anything it did was at the request of the
USG. OPIC has scheduled a meeting of its Board of Directors for March
19 to take a final decision on the case.
3
Theodore L. Eliot, Jr.
4
3
The OPIC Board of Directors deferred the decision. (Memorandum from Eliot to
Kissinger, March 19; National Archives, RG 59, Central Files 197073, INCO 152 CHILE)
In 1975, however, ITT received the largest indemnification from OPIC in OPICs history
up to that point: $34,706,917 in cash and $59,384,697 in OPIC-guaranteed Chilean Gov-
ernment obligations. (Davis, Last Two Years, p. 71)
4
Miller signed for Eliot above Eliots typed signature.
378-376/428-S/80023
JanuarySeptember 1973 851
323. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, March 20, 1973, 2124Z.
1154. Subject: U.S.Chile Negotiations. Ref: Santiago 1138, 1113
2
and 1110.
3
1. Summary: I have had a number of indications recently that GOC
is privately projecting optimism over possibility of early agreement
with USG on compensation and related issues. Press leaks also indicate
apparent build-up of expectations. GOC purpose in creating this at-
mosphere may be related to General Prats strong desire for an accom-
modation with USG and to Allendes belief that at least an appearance
of rapprochement is necessary ingredient in opening to PDC. Oppo-
sition leaders are concerned that USG might somehow be prepared bail
out Allende and urge careful middle course. End summary.
2. During past several days I have had occasion to talk informally
and privately with ten or a dozen Chilean figures active in politics. Sub-
ject of U.S.Chile bilateral talks has almost invariably been raised
always at their initiative. Chileans who have approached me have in-
cluded: [4 lines not declassified]. Several themes have emerged consist-
ently to merit reporting. These themes are also reflected in a number of
our CAS reports.
3. Point widely made is that Chilean Government is projecting
tone of optimism about possible U.S.Chilean agreement on issues
which divide us. Apparently, Senator Hugo Miranda (Allende inti-
mate) has been discreetly disseminating reports that the Chilean Gov-
ernment has been engaging in direct, private talks with both Anaconda
and Kennecott and has come to essential agreement to compensate
these companies by some sort of disguised or under-the-table arrange-
ments. Allegedly the State Department is presently the stumbling
block, insisting that arrangements be above the table for reasons of
world-wide policy. Other allegations are that Chilean Government is
disposed to make arrangement with us and is thinking of brief, en-
abling constitutional amendment to open the way.
1
Source: National Archives, RG 59, Central Files 197073, INCOCOPPER CHILE.
Secret; Immediate; Exdis.
2
Telegrams 1138 and 1113 from Santiago, March 19. (Ibid., Central Foreign Policy
File, [no film number])
3
Not found.
378-376/428-S/80023
852 Foreign Relations, 19691976, Volume XXI
4. Rumors of an impending U.S.Chilean accommodation have
leaked to the press. For example, La Segundas gossip column, Top Se-
cret, had this to say on March 13: Governmental circles are awaiting
with great optimism the result of the new conversations with North
American authorities regarding the renegotiation of the debt with that
country. According to leaks, conditions might perhaps have been
worked out already, with amounts, periods and interest rates set. The
article goes on to speculate that Maira has been championing a settle-
ment and that Socialist hot-heads continue to be the principal obstacle.
According to the article, hopes are high that Uncle Sam will open the
sluice gates of credit.
5. The foregoing allegations are reminiscent of the period before
Allendes foreign trip and the series of press leaks at that time about an
Allende meeting with President Nixon. As in the NovemberDecember
period, the Chileans have been circumspect in their official contacts
with me and other Embassy officers.
6. Two elements connected with Chilean internal politics provide
some explanation of the foregoing orchestrated leaks. First, there are re-
portswhich I am prepared to accept as accuratethat General Prats
is pushing hard for an accommodation with us as a way out of Chiles
present economic-political dilemma. Not only does General Prats ap-
pear deeply concerned with the danger of civil strife, economic deterio-
ration and institutional erosion within Chile, but he also fears that
Chiles conversion into a distant outpost of the Eastern Bloc would
make his country strategically and militarily vulnerable to irredentist
neighbors.
7. The second explanation for the insinuations which are circu-
lating may be Allendes interest in an opening to the Christian Demo-
cratic Party. Centrist Govt-UP figures seem to believe that at least the
appearance of rapprochement with the United Statescoupled with
the vision of U.S. credits and economic easementare crucial ingre-
dients in their effort at blandishment toward the PDC. (It remains to be
seen how much there is also an element of setting the stage for
blaming the U.S. if our talks produce disappointment.)
8. The GOCs leaked optimism about our talks is producing con-
siderable nervousness among opposition leaders. [name not declassified]
point of view is somewhat representative: We worry about the United
States stepping in to solve Allendes economic dilemma because
[garble] has received satisfaction on copper. This does not mean we
hope the talks will break down, or that America will not pursue a rea-
sonable and balanced course. We are nervous, however, that this
course might result in an outpouring of credits and economic help. We
need time, and the March 4 elections have shown that the time frame is
longer than some had hoped. In the interim we must hope that the U.S.
378-376/428-S/80023
JanuarySeptember 1973 853
will steer the careful and difficult course between unmasked hostility
and gratuitious economic rescue.
Davis
324. Memorandum From the Executive Secretary of the
Department of State (Eliot) to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, March 26, 1973.
SUBJECT
Executive PrivilegeSFRC Request for Internal Communications on Chile
The Church Subcommittee on Multinational Corporations of the
Senate Committee on Foreign Relations is investigating the activities of
ITT and its contacts with the USG in relation to the 1970 Presidential
election in Chile. One focus of these hearings is the allegation in the ITT
memoranda published in the Jack Anderson column in March 1972 that
CIA representatives requested ITT to take actions injurious to the
Chilean economy as part of a U.S. program to prevent the election of
President Allende in 1970. These ITT memoranda include other allega-
tions of U.S. intervention including an alleged instruction to former
Ambassador Korry in the name of President Nixon to do all possible
short of a Dominican Republic-type actionto keep Allende from
taking power.
2
Ambassador Korry is scheduled to appear before the Subcom-
mittee on March 27 and former Assistant Secretary Meyer will testify
on March 29. The Subcommittee has requested testimony from Secre-
tary Rogers, and also from Ambassador Vaky concerning his duties
while assigned to the NSC Staff. At this time, it does not appear that
Secretary Rogers will be available to testify, but we have offered to send
Acting Assistant Secretary Crimmins to speak for the Department. We
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Exdis.
2
See U.S. Congress, Senate Committee on Foreign Relations, Multinational Corpora-
tions and United States Foreign Policy, Hearings before the Subcommittee on Multinational Cor-
porations on the International Telephone and Telegraph Company and Chile, 19701971, 93rd
Congress, Part 2, Appendix I, March 2122; 2729, and April 2, 1973, p. 608. See also Doc-
ument 296.
378-376/428-S/80023
854 Foreign Relations, 19691976, Volume XXI
will try to persuade the Committee to accept information concerning
Ambassador Vakys contacts with ITT without requiring him to
appear.
CIA has worked out damage-limiting arrangements with the Sub-
committee that reduce its testimony to classified written responses to
specific written questions. Public inquiry into State Department con-
tacts with ITT are not expected to create many problems as those con-
tacts were innocuous.
The Subcommittee appears intent on several lines of inquiry which
raise serious problems, and the hearings will inevitably produce testi-
mony embarrassing to the administration in Latin America. The most
sensitive questions touch upon the privacy of communication between
the President (and the Department) and his Ambassador, and the in-
ternal deliberations of the USG, including meetings of the 40 Com-
mittee. Senator Church has formally requested access to the file of com-
munications between the Department and Embassy Santiago for the
period August 1, 1970January 31, 1971, and it appears highly likely the
Subcommittee will ask Ambassador Korry and the Department specific
questions based on the ITT memoranda in its possession, e.g.: Did Am-
bassador Korry receive instructions from the President or the Depart-
ment to take actions to keep Allende from taking power? Did Ambas-
sador Korry recommend a program of economic pressure on Chile in
an effort to block Allendes election? The Subcommittee may also
pursue questions as to the consistency of the alleged CIA activity re-
ported in the ITT memoranda with stated U.S. policy; whether the State
Department was informed of the Agencys discussions with ITT; and
by what authority, and at whose specific direction, Agency repre-
sentatives undertook those talks. In keeping with Presidential direc-
tives, the Department will attempt to comply to the fullest extent pos-
sible with Congressional requests for information. We will make every
effort to satisfy the needs of the Subcommittee without asking the Pres-
ident to invoke Executive privilege. However, consistent with the
policy established by the President, we will not disclose information
which would be incompatible with the public interest or would impair
the operation of the Executive Branch, but in those cases intend to re-
quest the invocation of Executive privilege.
In this regard, we believe that disclosure of the instructions sent to
Ambassador Korry and of his recommendations to the President and
the Department during the period in question would seriously preju-
dice the foreign relations interests of the United States. Moreover, the
disclosure of these communications would compromise the privacy of
deliberation within the Executive Branch which is essential to the effec-
tive conduct of Government. In addition, disclosure of the cable traffic
requested by the Subcommittee would embarrass Chilean friends of
378-376/428-S/80023
JanuarySeptember 1973 855
the United States, and U.S. citizens as well, who provided information
and advice to the Government in good faith reliance on the confiden-
tiality of their reports. For all these reasons we believe that Executive
privilege should be invoked if necessary to avoid such disclosures.
Many of the same considerations apply with even greater force to the
records of discussions within the National Security Council system
which contributed to the formulation of Presidential policy.
These issues are likely to come to a head first when Ambassador
Korry testifies on March 27. We have advised him that the President
must make the final decision on the question of Executive privilege but
that in our opinion the privilege applies with equal force to testimony
of former Ambassadors as to present officers of the Government. Am-
bassador Korry will endeavor to respond to the Committees questions
as fully as possible without provoking a question of Executive privilege
but within the limitations described above. In the event the Committee
insists on an answer to a direct question on his instructions or recom-
mendations he will ask to be excused from responding pending deter-
mination by the President whether he wishes to invoke Executive privi-
lege in that regard. In view of the special circumstances of this case we
believe it appropriate to request guidance from the President on these
matters at this time.
The Department of State has consulted with the Office of Legal
Counsel, Department of Justice; the Office of Legal Counsel has con-
cluded that as a general matter instructions to and recommendations
from an Ambassador and other internal Executive Branch communica-
tions fall within the scope of Executive privilege and that its exercise in
that respect would be consistent with the Presidents statement of
March 12, 1973, and his memorandum to Cabinet officers of March 24,
1969.
3
Therefore, we are requesting authority to invoke Executive privi-
lege, if necessary, to prevent disclosure of these matters.
Theodore L. Eliot, Jr.
3
For President Nixons statement on Executive privilege issued on March 12 and
the attached memorandum of March 24, 1969, which established a procedure for compli-
ance with congressional demands for information, see Public Papers: Nixon, 1973, pp.
184187.
378-376/428-S/80023
856 Foreign Relations, 19691976, Volume XXI
325. Memorandum From the Acting Assistant Secretary of State
for Inter-American Affairs (Crimmins) to the Under Secretary
of State for Political Affairs (Porter)
1
Washington, May 4, 1973.
SUBJECT
Chilean Congressional Elections
In an information memorandum of 6 April CIA reviewed the role
of US covert assistance to opposition parties in the 4 March Chilean
Congressional elections.
2
The Agency noted that of the $1,627,666 ap-
proved by the 40 Committee to help the opposition, all but $25,000 was
spent. The Agency believes that our help was effectively used. The op-
position nonetheless did not do as well as had been hoped, losing to the
government coalition two Senate seats and four in the Chamber. It did
retain a majority in both houses. CIA believes this result did not reflect
lack of energy or organization in the opposition, but rather a conviction
on the part of lower income groups and younger voters that their in-
terests lie with Allende and his Popular Unity forces. The Agencys
view that our aid was effective is based principally on the organiza-
tional improvements that it facilitated among the opposition elements,
chiefly the Christian Democrats and the Nationalists, which it believes
should have long-range value.
In its paper, the Agency states that it may prove desirable in the fu-
ture to provide additional funds to the Chilean opposition. ARA and
INR will submit their recommendations on such a proposal if and
when it is made. We have been giving assistance to the opposition since
Allende came into power, and we believe that on the whole our help
has put the opposition in a substantially better position than it other-
wise would be. ARA and INR will nonetheless look with considerable
care at any new proposals for aid in the light of conditions in Chile as
they have developed since our program of aid first began after Al-
lendes victory.
The Agency memorandum has been submitted for the information
of the 40 Committee Principals.
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile, 40 Committee Action after September 1970. Secret. Drafted by Gardner
and released by McAfee. Sent through George C. Denney, Deputy Director of the INR,
who initialed the memorandum. At the bottom of the page, Read by Amb PorterMay
8, 73, am, is written in an unknown hand.
2
The April 6 memorandum to the 40 Committee is Foreign Relations, 19691976, vol.
E16, Documents on Chile, 19691973, Document 133.
378-376/428-S/80023
JanuarySeptember 1973 857
326. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, May 24, 1973.
SUBJECT
Possible Coup in Chile
The attached special report from CIA (Tab A)
2
suggests that the
possibility of a coup in Chile has increased. Elements of the Chilean Air
Force have worked out a plan to overthrow Allende. It envisions sei-
zure of the Presidential palace by Air Force troops, supported by an ar-
mored battalion of the Army plus helicopters. Three commanders of
key Army units in or around Santiago are said to be backing this effort.
But officers of three other regimental-size units are said to be uncom-
mitted if not opposed to any such action. The Navy and some Air Force
units are reportedly in back of the effort.
There is no doubt that Chiles deepening problems have raised the
likelihood of a coup. But I believe this report should be read with con-
siderable skepticism. Several factors should be borne in mind:
The Commander-in-Chief of the Chilean Armed Forces, General
Prats, is out of the country and an extreme action in his absence would
do violence to the concept of military unity, so traditional in Chile.
The Chilean military has historically been reluctant to involve it-
self in political activity in the absence of a clear and serious threat to
order and public safety.
An unsuccessful coup attempt could produce civil war in Chile,
something that most if not all Chileans would do anything to avoid.
It appears that several key elements in a possibly unsuccessful
coup are missing from the plans as thus far reportedincluding the
participation of strong Army elements in the Santiago area.
This bears watching carefully, and we will be doing that. But in the
meantime, I do not think we should get too excited. Above all, there
should be no effort to involve the U.S. in these developments in any
way.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Sensitive. Sent for information.
Kissinger initialed the memorandum.
2
For the May 24 report, see Foreign Relations, 19691976, vol. E16, Documents on
Chile, 19691973, Document 134.
378-376/428-S/80023
858 Foreign Relations, 19691976, Volume XXI
327. Telegram From the Department of State to the Embassy in
Chile
1
Washington, May 29, 1973, 1641Z.
102367. Subject: SecVisit LAThe Secretarys Meeting with Presi-
dent Allende.
2
Date: May 25, 1973
Time: 7:30 p.m.
Place: Chilean Embassy, Buenos Aires
Subject: The Secretarys Meeting with President Allende
Participants:
Chile
President Allende
Foreign Minister Letelier
U.S.
The Secretary
Jack B. Kubisch, Assistant Secretary-Designate Inter-American
Affairs
Neil Seidenmann, Interpreter (OPR/LS)
1. After brief initial greetings, the Secretary told President Allende
that he was having a most useful and successful trip to Latin America,
his only regret being that he had not been able to visit more countries,
including Chile.
2. President Allende replied that he had earlier sent an oral invita-
tion to the Secretary to visit Chile on the occasion of the presentation of
credentials by Ambassador Letelier. The President added, however,
that he understood the Secretarys obligations and the demands on his
time.
3. The Secretary said that he wished to comment on over-all rela-
tions between the US and Chile, about which there was a certain
amount of speculation. There were some problems, he said, it was true.
The Secretary added, however, that the US wanted to have good rela-
tions with all countries in the world, and especially with those coun-
tries in Latin America that wished to have good relations with the US.
He said he had travelled all over the world and that it had been possible
1
Source: Department of State, Executive Secretariat, Briefing Books, 19581976, Lot
74 D 416, Box 172. Secret; Immediate; Nodis. Drafted by Kubisch; cleared by Pedersen
and Barnes; approved in S.
2
Rogers and Allende were in Buenos Aires for the inauguration of Argentine Presi-
dent Hector Campora. Rogers visited several countries in Latin America May 1228.
378-376/428-S/80023
JanuarySeptember 1973 859
to improve US relations with almost all countries, with only minor ex-
ceptions. The Secretary said that he was very glad to have the opportu-
nity to express these views personally to President Allende.
4. President Allende replied that he sincerely believed the Secre-
tary and that he himself was of the same mind. There had been no deed
or word on his part intended to create problems in relations with the
US. He had posed certain issues that affected Chile in a clear and re-
spectful manner, and in so doing had been consistently mindful that
one must distinguish between the people and Government of the US on
the one hand, and other elements. He had been firm in his reference to
certain companies that had followed policies in Chile that Chile ob-
jected to, specifically ITT. Hence, on the one hand, he saw the people of
the US, with their history, their traditions, their struggles, and their
government, and, on the other hand, these other troubling matters. As a
small country that had its own internal problems, it was certainly not in
Chiles interest to have additional problems with the US.
5. Allende pointed out that he had made gestures of his own
towards the US that had been friendly and even deferential. An ex-
ample was the invitation that he had extended to the USS Enterprise. He
had spoken personally with the Admiral. Also, he said, at no time had
he interposed any objections or obstacles to joint naval maneuvers.
Some of his compatriots did not particularly wish to go along with
these, but President Allende said that he was not interested in deferring
to their views. Unitas, a yearly event, was another case in point. It was
easy for a government to create a climate of opinion against another
country, or against an activity of a given country, if it so wished. But in
every instance, as in the case of Unitas, ships came into the harbor,
thousands of American officers and sailors came on shore, and there
had never been any problem or serious incident. And, of course, the
Chilean Government was interested in preventing incidents.
6. The Secretary stated that there were certain difficulties because
sometimes people tended to identify a specific company with the US
Government. In the case of ITT, he had learned of the possibility of
some kind of interference or involvement in Chiles electoral process,
and he had said no, absolutely not. However, there had been a certain
amount of publicity regarding conversations that had taken place at
lower levels of the US Government. The Secretary said he had stopped
this sort of thing from going forward because it simply did not make
sense. Further, in regard to the problem of the identification of a com-
pany with a country, the fact was that most American companies acted
in the right way; and most countries wanted American investment. The
US Government certainly would not follow a policy of encouraging in-
vestors to go to a country that did not want them. The Secretary
pointed out that he had visited some 62 countries, almost every one of
378-376/428-S/80023
860 Foreign Relations, 19691976, Volume XXI
the major countries in the world. In almost all of these countries, their
leaders seemed to want to encourage American businessmen to invest
in their countries, even in the case of Eastern Europe and the Soviet
Union. Of course, the US favored these relationships, because we were
in favor of trade, and we believed in interdependence. But such invest-
ments depended on the wishes of the other governments. We believed
that being pragmatic was the best way to approach these matters. An
example was the case of Canada which had more investment per capita
in the US than did the US in Canada, a fact which not many people
knew. Germany and Japan were also investing substantially in the US
now. So there will be growing competition for American capital
throughout the world.
7. President Allende said that he had stressed repeatedly that one
must distinguish between governments and peoples, particularly gov-
ernments which were transitory such as in the US which often changed
between Democratic and Republican administrations. The same was
true in the case of Chile, where in 1976 a different party might come to
power. In the recent past, Chile had had administrations under the
Independent Party, with Ibanez; the Conservative Party, with Alles-
sandri; and finally Frei.
8. Allende went on to say that as a Socialist and as a man who be-
lieved in democratic pluralism and freedom, he wanted to tell the Sec-
retary that he believed there was a definite, palpable feeling running in
Latin America, a feeling that there must be change and evolution
throughout the continent. What could be worse, he asked than for such
a sentiment to be blocked or frustrated by the US?
9. The Secretary replied that he shared Allendes view. He said he
felt that what was often lacking in Latin Americaand this was what
he had in mind when he talked about paternalismwas a thrust on
the part of the various countries to do things for themselves as indi-
vidual, sovereign nations. The US welcomed nationalism as long as it
was constructive. But if nationalism became negative and was based
simply on anti-US policies, what purpose would it serve? On the other
hand, if nationalism expressed itself as a desire to bring about a better
life for the peoples of Latin America, and if the US could help, then that
was our desire. Even so, if countries did not want US assistance, that
was all right with us, too.
10. President Allende said he was going to tell the Secretary some-
thing that he was sure he would believe, but not without some diffi-
culty. This, he said, was strictly between him and the Secretary. Al-
lende went on to say that he had been a personal friend of Fidel Castro
for a long time, some 12 years. And in his conversations, Fidel had said,
Dont get into fights with the US unnecessarily, and watch your
dollars! Allende said that he thought this was very sound advice.
378-376/428-S/80023
JanuarySeptember 1973 861
11. Secretary Rogers said that, as they were speaking frankly, he
also wanted to comment on criticism leveled at the US for being rich
and powerful. Most Americans, he said, started out in life with little or
nothing. It was just that the US had a system that worked. The Secre-
tary pointed out that in his travels to different parts of the world, par-
ticularly to countries such as Yugoslavia and Romania, the authorities
consistently said that they wanted closer ties with the US; they urged
the US to have closer relations and for the USA to encourage Americans
to go to their countries. They seemed to trust us. They didnt make
speeches against the USin fact, usually the opposite. But this was
where problems came up in our desire to be friends with Latin
America. We felt there had to be a change in climate. We were not inter-
ested in interfering in the affairs of other countries. In fact, there was a
trend at present in the US toward a kind of isolationism, where many
people in our country took the attitude that they have what they
wanted and the US should simply let other countries worry about their
own problems.
12. President Allende said that the basic policy was entirely right,
namely, the respect for autonomy and non-intervention in the affairs of
other countries, which should be the normal basis for relationships on
the part of all countries, big or small.
13. The Secretary commented that we were also troubled when we
were accused of imperialism. We returned Okinawa to Japan, and there
were many, many other examples showing we were not interested in
any acquisitions. Whenever countries called upon the US when disaster
struck, our country contributed more than any other, as had been the
case in Peru, Morocco, Tunisia, and many other countries. That was
one of the reasons why Americans objected to polemics vis-a`-vis the
U.S. This was both unproductive and created problems in getting
cooperation.
14. President Allende observed that perhaps there was simply a
different approach. He said that what he called economic imperialism
was something quite apart from the USG. In the case of Chile, the
copper companies had garnered fabulous, almost incredible profits in
proportion to their initial investments, and they had never developed
manufacturing or processing industries in Chile. As a result, Chile re-
mained simply a producer of raw materials. This could not continue.
Chile now had to import its manufactured goods and sell only raw ma-
terials. In other words, Chile had to pay American wages for the things
it wished to buy.
15. Allende then said that Chile did not want an understanding
with the USrather, it must have an understanding with the US. But
he felt that the US should also try to understand the Chilean situation
just as the US expected Chile to understand its situation. Allende went
378-376/428-S/80023
862 Foreign Relations, 19691976, Volume XXI
on to say that in Chile the domestic situation was such that there was a
unanimous vote in Congress, where his party did not even have a ma-
jority, on the issue of nationalization. Hence, for this reason and on con-
stitutional grounds at this point in time, Allende said he did not have
the power to pay any compensation. However, if the way were pre-
pared, and things ran smoothly, a different climate could be created. If
Chiles access to credit was blocked with the international financial in-
stitutions and American banks, and if Chile could not buy spare parts
and acquire needed materials, then this could hardly bring about a
good climate. He said he was not against dealing with the US. Very
frankly, he said, some of his people were against doing so, just as he un-
derstood that many people on the US side must not welcome this
course. But Allende had let it be known that he was making the deci-
sions, and he had said that he was going to deal with the US. And Chile
had done so. Talks have been held.
16. Inasmuch as these talks have not been fruitful, Allende went
on, Chile believed that we should now proceed on the basis of the 1914
Treaty, providing for a commission to study the matter.
3
From the
standpoint of the Chilean people and Chilean public authorities, this
was a valid legal instrumentality. And if this instrumentality did not
yield anything useful, it was still better to follow this route than not to
make use of available machinery. President Allende went on to confide
to the Secretary that some of his people had asked him what would
happen if the commission decided that the matter should be referred to
an international tribunal? Allende said he had told them that this was
what they would have to do, providing the decision were legitimate
and properly within the jurisdiction of a tribunal.
17. The Secretary said that he was a lawyer and explained that he
liked to stress the law because it was the only thing that worked. If,
with each change of government, it were decided that a company had
made too much profit in the past or that it had been unfair, this would
mean there would be no sense of continuity, and investors would not
know what would happen next. They could have their companies
expropriated and not compensated every time there was a change of
government.
3
The 1914 Treaty of Conciliation and Arbitration, also known as the Treaty for the
Advancement of Peace, established a five-person commission, two members appointed
by each country and a third-party member appointed by agreement. For the text of the
treaty, see Treaties and Other International Agreements of the United States of America,
17761949, pp. 550552. When the United States and Chile began bilateral discussions in
December 1972, the Chileans wanted to invoke the Treaty (which had never been in-
voked up to that time) because of the third-party mechanism. See Davis, Last Two Years,
pp. 103106, and Documents 318 and 320.
378-376/428-S/80023
JanuarySeptember 1973 863
18. He pointed out that investors were presently turning more and
more to opportunities available in Europe, Japan and the developed
countries. For this reason it was a mistake for developing countries to
act as if profits were evil.
President Allende said that not all profits were evil, only exces-
sive profits.
19. The Secretary asked who would decide that profits were
excessive?
20. Allende stated that something must have happened for this
welling up of feeling to have come about in Latin America. He said that
while Secretary Rogers was a lawyer, he was sure that he was also a
good political man and would understand this. He went on to say that
this feeling was often expressed awkwardly, but the matter of foreign
investments had to be taken most seriously. The Andean Pact
4
coun-
tries studied it, and as a result had established a framework within
which investments could be made and periods within which assets
stemming from such investments were to revert to the countries them-
selves. Ten years ago such an agreement would have hardly been
imaginable.
21. The Secretary observed that reaching the agreement was not
difficult. The difficulty would come when there was an attempt to im-
plement it. The question was, how would the countries arrange for the
financing to pay for the properties involved?
22. The Secretary went on to say that he understood the attitude
that profits might sometimes seem excessive. The US was not against
rules being set up by countries where investments were made. The
problem came about with retroactive changes in the rules. Changing
the rules prospectively was an act of sovereignty and, obviously, was
legitimate. But to say that previous governments were unwise and
therefore properties were going to be taken over without reasonable
compensation would be disastrous from the standpoint of new invest-
ments. People would simply not want to invest further in those
countries.
23. The Secretary stressed that he was not pleading the cause of
any given company and that he was not in a position to make a judg-
ment about whether profit levels of any given company were excessive
or not. A country might say that it did not wish to have investments or
say that investors must agree to limit their ownership to a given per-
centage. But, said the Secretary, he believed it would be difficult to get
money from abroad under these conditions.
4
The Andean Pact, a South American trade bloc, was formed in 1969 by Bolivia, Co-
lombia, Ecuador, Peru, and Venezuela.
378-376/428-S/80023
864 Foreign Relations, 19691976, Volume XXI
24. Allende said that US copper companies had 50,000 mining
properties in Chile of which only 5,000 were being worked. The others
simply were not operating and all the companies had to do was pay a
license fee. This was harmful to Chile. So one could not fail to criticize
previous governments, and call into question their policies in allowing
these kinds of things to go on. He pointed out, however, that an agree-
ment had been reached with Bethlehem. Also, Chile was on the verge
of reaching an agreement with Cerro. The difference had been nar-
rowed down to a gap of approximately $3 million. Allende, giving ap-
proximate figures, said that Cerro was claiming about $36 million and
the government was talking about $33 million. Allende said that he had
recommended splitting the difference at $34.5 million. Mr. Kubisch
said he understood the figures were considerably higher than this. Al-
lende said he was not sure of the exact figures, but at any rate Chile was
definitely going to reach a settlement with Cerro. There were also
four or five smaller mining companies operating in Chile where agree-
ment was being reached. An agreement was also being reached with
RCA.
25. The Secretary said that we were looking into such matters very
carefully, and at a high level. He indicated that he and Secretary Shultz
would be getting together upon his return, and that we would be in
touch with the Chilean authorities on this subject by the early part of
June. He said he hoped that meetings could be resumed, and at a high
level and quietly, so that there would be no undue publicity. He felt
that if it were possible to conduct the negotiating privately it would be
easier to reach solutions.
26. Allende said that he entirely agreed. Such a format would not
be difficult from his standpoint. After all, he pointed out, the Secretary
had come to visit him that very evening and there were no photogra-
phers and no TV.
27. In taking his leave, the Secretary said he appreciated the
meeting with the President. Allende replied he was pleased to have re-
ceived the Secretary.
Rogers
378-376/428-S/80023
JanuarySeptember 1973 865
328. Memorandum From the Executive Secretary of the
Department of State (Eliot) to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, May 30, 1973.
SUBJECT
ChileNext Steps
The March 2223 U.S.Chile bilateral talks concluded in a virtual
impasse. The GOC formally proposed application of the non-binding
1914 Treaty procedure (investigation and report) to the copper dispute
and requested a U.S. response. We pressed Chile on its commitment
under the Paris Club Agreement to have direct negotiations on copper
compensation and stressed the need for a substantive rather than cos-
metic solution. We suggested that both sides review their positions and
consider continuing the talks at a higher level.
Since the 1914 Treaty procedure, in the form proposed by Chile,
does not promise a resolution of the problem and would permit delay
during which we would be under pressure to restore normal financial
relations with Chile, we do not wish to accept it.
2
However, under its
terms, Chile may attempt to invoke the treaty unilaterally; if it does so,
unless we have offered a plausible counterproposal, we would be put
in the very embarrassing public position of attempting to avoid hon-
oring a treaty obligation which Chile had proposed as the means for re-
solving the copper dispute. A continuance of our existing policy of in-
sisting on a bilateral settlement could very well result in an erosion of
support for our position, strengthen Chiles position at the next Paris
Club meeting (July 1973), and encourage the IFIs to proceed with
lending to Chile in the light of Chiles reasonable steps offer of concilia-
tion under the 1914 Treaty.
In view of these circumstances, the Departments of State and
Treasury believe that the U.S. should counter the Chilean proposal
with a formal offer to submit the copper dispute to expeditious and
binding arbitration. We are developing a specific proposal that will en-
sure an impartial tribunal and proper terms of reference and proce-
dural rules.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Exdis. Drafted by Feldman and
Bradfield; cleared by Benedick, Crimmins, and Hennessy. In a June 4 memorandum to
Kissinger, Jorden summarized this memorandum and received Kissingers approval of
the StateTreasury proposal for submitting the dispute over copper to arbitration. (Ibid.)
2
See footnote 3, Document 327.
378-376/428-S/80023
866 Foreign Relations, 19691976, Volume XXI
Our case on the Chile compensation problem is sufficiently strong
to give a good chance of our obtaining an objective third party finding
that Chile has an obligation to pay substantial compensation to the ex-
propriated copper companies. Such a result would achieve important
long-standing objectives of U.S. foreign policy by establishing that in-
ternational law requires effective payment of just compensation for ex-
propriated property and that investment disputes should be settled by
impartial procedures rather than unilateral imposition. Moreover, an
objective third party determination would afford Allende the most
credible basis for obtaining domestic support for the payment of com-
pensation. We are not sanguine the GOC will accept arbitration, but
such a proposal would strengthen our international position on this
issue.
Any third party adjudication, whether binding or not, carries the
risk (in our view acceptable) of a ruling favorable to Chiles position on
compensation that would have serious implications for the security of
all U.S. foreign investment in similar situations. If we accept the risk of
recourse to a third party, it would be in our interest to have the out-
come binding: in fact, the investors whose cause we would be es-
pousing are unlikely to agree to a non-binding procedure. (We would
continue to consult closely with the companies.)
An arbitration proposal raises questions about the consistency of
this approach with our objectives as defined in NSDM 93
3
(maintaining
maximum economic pressure on the GOC) since we believe it would
cause some movement in the international financial institutions toward
a resumption of lending to Chile. Resumption of lending by the IFIs in
the circumstances of submission of outstanding investment disputes to
arbitration would be consistent with the Presidents expropriation
policy and with the requirements of the Gonzales and Hickenlooper
Amendments. But such movement would offer very little if any short
term relief to Chiles serious balance of payments difficulties. More-
over, a flat refusal by the USG to apply the 1914 Treaty, without a coun-
terproposal, would also affect adversely U.S. influence with Chiles
creditors and the international financial institutions. Thus, in either
case some movement in the IFIs may result. This factor, and the posi-
tive results we can expect from an arbitration proposal lead us to the
conclusion that the proposal is consistent with the directives contained
in NSDM 93.
Thus, Treasury and State believe that an arbitration proposal is es-
sential to maintain a credible posture before the public and other cred-
itor governments in response to the Chilean proposal to use the proce-
3
Document 175.
378-376/428-S/80023
JanuarySeptember 1973 867
dures of the 1914 Treaty. We expect the next meeting of the Paris Club
to be in early July. Therefore, unless there is objection to this approach,
we plan to make this proposal to the GOC in early June.
Theodore L. Eliot, Jr.
5
5
Miller signed for Eliot above Eliots typed signature.
329. Memorandum From the Director of Operations Policy,
Bureau of Intelligence and Research (Gardner) to the Deputy
Director for Coordination, Bureau of Intelligence and
Research (McAfee)
1
Washington, June 14, 1973.
SUBJECT
ARA/CIA Meeting, 11 June 1973
PARTICIPANTS
ARAMessrs. Kubisch, Hurwitch and Shlaudeman;
CIA[name not declassified]; INR/DDCJames R. Gardner
[Omitted here is discussion unrelated to Chile.]
Chile
After [name not declassified] reviewed the financial details of the
new proposal for extending the financial assistance to the Chilean op-
position, Mr. Kubisch recalled the reservations that he had expressed
on 30 May and remarked on the dimensions of the risks in todays at-
mosphere that we ran were our assistance to become known.
2
Mr. Shlaudeman said that the risk of our assistance becoming
known centered here rather than in Chile. Neither side in Chile really
1
Source: National Archives, RG 59, INR Files, Lot 94D565, James Gardner Chrono-
logical File. Secret. Printed from an unsigned copy.
2
According to a May 31 memorandum from Gardner to McAfee recounting the
ARA/CIA meeting, Kubisch questioned if U.S. interests in Chile were critical enough to
justify such an extensive and ongoing covert operation; if they justified the dangers in-
volved; if they were effective; if there was a way to accomplish U.S. objectives without
covert operations; and whether the program should be ended. The full text of the memo-
randum is Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973, Docu-
ment 135.
378-376/428-S/80023
868 Foreign Relations, 19691976, Volume XXI
wanted to raise the matter. The subject of covert foreign assistance had
been deprived of much of its credibility because of overplay by Marxist
elements in Chile. The secrecy of the operations in Chile have actually
been very good, as good as any he had ever seen. The real danger of
compromise lay here rather than in Chile; exposure here would receive
a far bigger play and far more credence in Chile than anything that
could be said there.
Mr. Kubisch remarked that we had been involved in the Chile elec-
toral process for so long that it would take a long clean period before
there would be general belief that we were not involved.
Mr. Shlaudeman said we had made considerable progress in the
past few years in convincing the Chileans that we were not trying to rig
their elections. He noted that it was widely believed that we did not
give financial support to Chilean parties during the last congressional
elections. To him, the important step was to keep clear of any role in
which we were attempting ourselves to engage in operational activ-
ities. We could not tell Chileans how to run a campaign. To do so
would get us into trouble comparable to that arising out of the 1964
elections.
Mr. Kubisch noted that the CIA paper had pointed up three pos-
sible positions.
3
One of these, a golpe, was not held to be a serious pos-
sibility. Why? [name not declassified], replying for the Agency, said in ef-
fect that the Chilean populace was not geared to thinking in terms of
overthrowing their Government. Compromise was to Chileans an es-
sential element of the political process. Furthermore the Chilean mili-
tary since 1932 had had constitutionality drilled into them; it would
take a great deal to get it to move. [name not declassified] went on that
there were a number of preconditions to be met before golpe could be
seriously considered in Chile. One was mass support, of which there
was clearly no evidence. The military would have to be united in their
opposition to the present regime; it was not. There would have to be
political support from the parties, especially from the PDC; there was
no such support. There would also have to be a good constitutional
reason for an attempted coup. At the moment there was none. There
would have to be a military consensus that a coup was required. There
was no prospect that such a consensus could soon emerge.
Mr. Kubisch said that it therefore was clear that a military coup
seemed to be a non-starter.
[name not declassified] said that the most likely way an overthrow
might occur would be through a constitutional coup, with the mili-
tary being brought into all key positions in the government, and in-
3
Presumably the May 24 report; see Document 326.
378-376/428-S/80023
JanuarySeptember 1973 869
sisting on a number of requirements or conditions which would give
everybody a measure of what he wanted.
Mr. Kubisch wondered if by granting limited assistance to the op-
position we were but giving them the means to keep barely alive, en-
couraging them in an ineffective opposition; it might be better to cut off
assistance and let the situation develop to a point that a reaction would
be triggered that would produce a constitutional coup or some other
response more effective than that we were now seeing.
Mr. Shlaudeman said that it was more likely that a cut off of our
assistance would work the other way. Opposition in Chile to Allende
was a result of party activity. Parties were central in Chile. If the parties
faded, opposition influence among the military would tail off. Despite
evidence in early 1971 that the heart had gone out of the opposition, it
had lately come to show considerable energy. Without our help it could
do much less, it would lose heart. The visibility of political activities
and media independence was what kept the opposition going.
Mr. Kubisch asked if, in the last analysis, a country didnt have to
save itself.
Mr. Shlaudeman observed that the Chileans were fighting Allende
on their own initiative, the decisions were theirs. The little edge that we
were giving them with our financial assistance was critical, but we
were not and must not get in the position of saving them.
Mr. Kubisch said that he was not persuaded that a vital US interest
of the sort that would justify our covert assistance really was involved.
Messrs. Shlaudeman and Hurwitch agreed that there was no vital in-
terest, but nonetheless an important one.
Mr. Kubisch agreed with Mr. Hurwitchs formulation that new
sensitivities in the US and in Chile to US covert activities should not
necessarily drive us to abandon all these, but that they would make it
necessary to analyze in a much more critical way than hitherto the im-
portance of the objectives that we were trying to achieve through them.
Mr. Kubisch said that in this particular instance he did not believe
that the benefits outweighed the potential cost.
Mr. Hurwitch said that it would be of inestimable importance to
our policy in Chile, in Latin America and in the rest of the world were a
free Chilean election to be held in 1976 that would result in a demo-
cratic repudiation of a Marxist regime. Such a development would be
far better for us than any military coup in Chile could be. He himself
believed that a free election in Chile would actually result in the rejec-
tion of Allendes regime. The current covert program kept the hope
alive that this result could be won. He therefore thought that the poten-
tial benefit outweighed the risk. He would hesitate to narrow the possi-
bility of reaching such an outcome.
378-376/428-S/80023
870 Foreign Relations, 19691976, Volume XXI
Mr. Kubisch said Mr. Hurwitchs position was persuasive. He then
sought to advise on how best to bring the considerations that had been
surfaced to the attention of the 40 Committee. Positions held two years
ago by the Committee members and by the White House were not nec-
essarily ones that would be held today were the Committee brought to
focus on the new elements in the situation. He reacted positively to the
suggestion that an effective way to insure the necessary reexamination
was by persuading Ambassador Porter, our 40 Committee repre-
sentative, that the situation should be examined de novo. It was de-
cided that the text of the CIA-proposed memorandum would state
merely that Mr. Kubisch had been consulted on the program, not that
he had concurred. He would see to it that the various pro and con argu-
ments were brought to Mr. Porters attention.
330. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, June 21, 1973, 2228Z.
2706. Subj: Chiles Political Crisis.
1. Summary: It is increasingly clear that the Chilean Communist
Party has passed to a harder linecloser to the Socialists and less com-
patible with the President. The recent Air Force sit-down probably
weakened that institution and its Commander in Chiefand gave the
senior officers of other services pause. The military position regarding
the present crisis has not yet emerged, however, and it is likely to be
some days before terms for a possible military reentry into the Cabinet
are clarified on all sides. End summary.
2. The present moment may not be ideal for forwarding reflections
on Chiles political crisisminutes after President Allende has finished
addressing a massive crowd at the Moneda. Nevertheless, I believe a
few observations are worth making. First, it is increasingly clear that
the Communists have shifted to a harder line. They have moved closer
to the Socialists, MIR, Left Christians and Ulta-MAPU, and have
moved away from the President. They demonstrated this publicly last
Friday when they joined with the Socialists in openly repudiating the
President for having received the El Teniente miners, and their faint,
1
Source: National Archives, RG 59, Central Files 197073, POL CHILEUS. Secret;
Immediate. Repeated to USCINCSO, Lima, and Buenos Aires.
378-376/428-S/80023
JanuarySeptember 1973 871
subsequent denials have not erased the reality. From clandestine
sources our Station is reporting that this Communist shift is deliberate,
sharp and real. According to one SRF report,
2
the Communists and So-
cialists rammed through the decision for todays shutdown and rally
over Pres Allendes opposition. It is significant that Investigaciones
would enter and smash the University of Chiles new television studio
on the morning of the Christian Democrats rally this Tuesday. If it is
confirmed that the armed infiltrators who shot it out with Air Force
guards at Los Cerrillos were young Communists, this too might be in-
dicative of the changed line. During Allendes trip to Rancagua yes-
terday, UP strike-breaking copper workers reportedly warned the
President in strongest terms against conceding, and undercutting
them. The President, through his Secretary General, excommuni-
cated the National Party last night saying no senior government offi-
cial should henceforth treat with them. Today he said the government
would move through administrative means against Patria y Li-
bertad. All these actions go in the same direction.
3. Then there is todays shutdown and rally. The object is intimida-
tionto show the opposition and, even more important, the Armed
Forces what the consequences of any golpe might be. It might also have
been a practice-exercise for G-Day plus one. The crowds were impres-
siveswelled in part by the fact that the marchers not only are under
pressure to attend, but also have to return to their factories and get their
time cards punched if they want their days pay. Regardless of how the
workers got there, nobody is contesting UP control of the streets of cen-
tral Santiago this 21st of June. Prudence tempered valor when the op-
position decided to shut down, just as tight as the leftists, and guard
their homes.
4. The recent bread-and-butter, sit-down mutiny of Air Force non-
coms frightened, shamed and enraged senior officers. It comes on the
heels of a similar troubles within the Carabinero corps. It has probably
weakened General Ruiz, who is widely considered the strongest bul-
wark against Marxist advance among the commanders in chief.
5. It seems early to know how Chilean officers will definitely react
to the signs that service discipline is eroding. They may add the
workers menacing show of strength to their calculations, and pull in
their horns. On the other hand, they may react with a deeper conviction
that something must be done before power, discipline and their troops
economic well-being erode and wash away. Somebody forced the CUT
to back off on its announced intention to cut off electricity, gas, tele-
phone, water and other essential services, as part of todays planned in-
2
Not further identified.
378-376/428-S/80023
872 Foreign Relations, 19691976, Volume XXI
timidation. I have no information, but I would not be surprised if it was
the military who put a foot down.
6. The past few days have witnessed further cracking of the veneer
of legality on the surface of Chilean political and economic life. The ap-
peals court pronounced the raid on the University of Chiles new televi-
sion station as illegal. Chilean respect for university autonomy was also
affronted, but the court decision has in no way undone the closing. In
the truck farming area around Maipu, the MIR has just completed a
bold and almost bloodless illegal seizure of a great belt of farms. This
event has gone almost unnoticed in the onrush of events. Fresh vege-
tables are rotting on the ground, and there will be less for eating in the
city but the MIR and Socialism have advanced another step.
7. The Cabinet crisis continues, with rumors, reports and formulas
of every descriptionall of them revolving around the terms the mili-
tary could extract for entering the government. The latest rumors
sound closer to the OctoberMarch formula, and farther from the real
power the military were said to be determined on getting. So far as we
know, however, the Council of Generals has yet to hold its crucial
meeting. Neither have the Navy or Air Force taken a final position, we
believe. My guess is that it will be some days before the question is
clarified.
Davis
331. Telegram From the Embassy in Peru to the Department of
State
1
Lima, June 25, 1973, 1438Z.
4355. Subj: Chile: Copper Disputes.
Summary: First secret meeting held with Almeyda, Cardemartori
and Urrutia at Chilean Embassy residence Sunday morning June 24
consisted principally of detailed exposition by Kubisch and Hennessy
of USG reponse to Chilean proposal of March and presentation of U.S.
counterproposal. Almeyda acknowledged USG effort to take into ac-
count major Chilean concerns in advancing new formula and said
Chilean side would ask questions and seek clarification in subsequent
1
Source: National Archives, RG 59, Central Foreign Policy File, [no film number].
Secret; Immediate; Exdis. Repeated immediate to Santiago.
378-376/428-S/80023
JanuarySeptember 1973 873
meeting after having had chance study U.S. proposal. Chilean accept-
ance or suggestions for additions to proposal would be made at
highest GOC level and no definitive response would be possible for the
moment. End summary.
1. Asst. Secretary Kubisch and Asst. Secretary Hennessy, accompa-
nied by Raymond Gonzalez (Embassy) met at Chilean residence, Lima,
morning June 24 with Clodomiro Almeyda, PC Deputy Cardemartori,
and CODELCO New York Rep Javier Urrutia. After brief welcoming
and introductory remarks, Almeyda asked Kubisch for USG response
to Chilean procedural proposal of using the 1914 Treaty made during
bilateral talks this subject last March.
2. Kubisch stressed that his presence in Lima and at meeting re-
flected strong USG desire reach settlement this problem. He referred to
Secretarys meeting in Buenos Aires with President Allende and joint
conclusion from that meeting that long tradition of friendship between
two countries should not be further damaged by copper problems.
2
Secretary had made clear USG prepared meet with GOC, on basis full
equality and mutual respect, in joint effort to attain common objectives.
USG prepared to accept whatever internal political, economic and so-
cial policies Chilean people want for themselves and there should be no
misunderstanding of USG attitude in this regard.
3. Hennessy then summarized history of previous negotiations
which he separated into two stages. First or multilateral phase
stemmed from Paris Club meeting in February shortly after Chilean ac-
tion against companies. Four intensive meetings in which Ambassador
Letelier took part led to April 19, 1972 agreement.
3
Hennessy stated
USG decision to sign agreement represented major demonstration our
good will and concrete proof our willingness accept multilateral frame-
work for solution financial and copper questions. He highlighted im-
portance of Art 4 which provided mechanism for carrying out direct bi-
lateral settlement with companies or USG, although he acknowledged
there were some differences in interpretation by Chileans on this ar-
ticle. Paris Club agreement was at the time seen by Chileans and urged
on US as important because (A) it would provide Chile with time it
needed to prepare way for bilateral solution (B) USG signature was
positive act which would improve domestic political climate. Hennessy
then recounted effects of copper tribunal ruling in September, which
after assurances at time of Paris Club signing was a great disappoint-
ment as it seemed to close door.
2
See Document 327.
3
See Documents 297 and 298.
378-376/428-S/80023
874 Foreign Relations, 19691976, Volume XXI
4. Hennessy then described second or bilateral phase of previous
negotiations recounting December 1972 meeting with GOC, alluded
briefly to 1914 Treaty as one of several procedures which perhaps
might be followed, while USG indicated we had perfectly suitable
mechanism in Paris Club agreement. At second formal meeting in
March while Chilean side showed disappointment USG not prepared
give definitive reply to 1914 Treaty, this was unfounded since GOC had
not made any formal presentation of this as a firm offer, but merely a
passing reference.
4
Subsequent conversations between Crimmins, Hen-
nessy, AlmeydaLetelier had suggested advantage of moving away
from large, formal bilateral meeting to smaller more practical meeting
such as todays in which we could test good will to reach solution.
5. Kubisch then outlined preferred U.S. solutions to copper
problems with American companies: (A) GOC settle directly with com-
panies; (B) if this not possible, GOC negotiate bilaterally matter of com-
pensation; (C) if latter not possible, GOC enter into arbitration proce-
dure with companies; e.g. such as provided for in IBRD. GOC has said
none of these acceptable and stated it cannot compensate companies
now. GOC has manifested more time necessary to work out solution
and suggested some third party proceeding might be helpful, pro-
posing 1914 Treaty.
6. Kubisch underscored great importance which USG attaches to
GOC undertakings in Paris Club and declared US most reluctant to
turn attention away from these commitments for uncertainties of third
party procedure. He expressed belief Paris Club members would be
surprised at GOC interpretation to effect its obligation to honor debts
and make just compensation not applicable to copper problem, which
was major issue at Paris. Nevertheless, because of importance we at-
tach to resolution of problem we prepared explore some procedure
other than Art 4 that meets our mutual concerns.
7. As we understand it, Kubisch continued, two principal Chilean
concerns include (A) need for time to prepare ground for settlement
and (B) objective finding by impartial third party. President Allende
has also said GOC neither simply trying to delay settlement nor gain
time but is prepared seek a true solution. USG willing attempt to use es-
sential elements of Chilean proposal as basis for moving forward.
However USG asking for one thing more: that procedure we agree
upon resolves problem one way or other and within reasonable time.
USG had carefully considered not only GOC proposal use 1914 Treaty
but also provisions of 1929 Inter-American Arbitration Treaty and 1899
Hague Convention. Kubisch said USG has prepared proposal which
4
See Documents 318 and 328.
378-376/428-S/80023
JanuarySeptember 1973 875
carries out objectives these instruments and also meets major concerns
of both sides.
8. Kubisch read proposed procedure for settlement of copper dis-
putes as follows: Begin text: It is proposed that the United States and
Chile submit the question of the compensation to which the U.S. copper
companies may be entitled under international law to the decision of an
impartial third party. Both governments would agree to accept and
carry out the result of that proceeding. The two parties would establish
the impartial tribunal by mutual agreement and stipulate appropriate
terms of reference and rules of procedure. These rules should include a
time limit for the completion of procedures and the rendering of the de-
cision. The panel should have the authority to consider all of the issues
necessary to determine whether the copper companies are entitled to
payment of compensation and, if so, to establish the amount. It is fur-
ther proposed that the two governments constitute a panel that would
be mutually acceptable and draft the necessary terms of reference and
rules of procedure. End text.
9. Kubisch then gave copy of text to Almeyda. He stated proposal
represents a major concession and sustantial risk for U.S. It is conces-
sion because it sets aside for present time commitment Chile undertook
at Paris and great risk because it makes settlement contingent on judg-
ment of third party, as Chile had suggested. That decision and settle-
ment could have great effect not only on copper companies but on the
American companies and on more than $80 billion of foreign private in-
vestment throughout world. He repeated this represents substantial
risk but USG makes proposal in good faith and after consideration of
all possible solutions. Kubisch offered clarify proposal or answer any
questions Chileans might have.
10. Almeyda expressed appreciation for efforts of U.S. reps in pro-
posing procedural formula for solution of problem worrying both sides
and one, as stated by Asst. Secretary Kubisch, which takes into account
major Chilean concerns. Said they would consider U.S. proposal with
greatest attention but naturally decision to accept, or possibly to sug-
gest additions, would have to be taken at highest GOC level. Chilean
side would not be in position to give definitive reply at this time. Nev-
ertheless, Chilean side wished to take advantage of presence in Lima of
U.S. reps to ask for clarification, explore sense of proposal and its com-
patibility with political and legal framework. He proposed recon-
vening meeting after Chilean side had few hours to study proposal. We
meeting again at 6:30 p.m. Sunday evening.
5
5
July 1.
378-376/428-S/80023
876 Foreign Relations, 19691976, Volume XXI
11. In slightly polemical terms Almeyda referred to Hennessys
points on Paris Club agreement and reiterated Chilean contention GOC
not obligated by Art 4 to negotiate directly a settlement of copper com-
pensation dispute because that would have been legally impossible for
negotiators to agree to since it would be contrary to Chilean constitu-
tion. Hennessy replied to these points and raised fact that irrespective
of GOC interpretations, the other creditors had a clear concept of the
meaning of Art 4 and the GOC compliance would be reviewed as first
order of business. Mutual benefit of having reached a satisfactory
agreement beforehand was clearly evident.
12. Comment: While opening session devoted mostly to presenting
our proposal and no immediate reaction forthcoming, Chilean attitude
appeared relatively open. Believe our detailed review of background
and exposition of our preferred positions and willingness accept essen-
tials of earlier Chilean proposal was useful setting of stage for subse-
quent sessions.
Belcher
332. Message From the Station in Chile to the Central Intelligence
Agency
1
Santiago, June 25, 1973.
1. We have not noticed any significant shift in [less than 1 line not
declassified] views concerning support to the [less than 1 line not declassi-
fied] private sector. He remains unenthusiastic about supporting this
sector because of his concern that our financial aid might enable the
[less than 1 line not declassified] movement to develop into a parallel po-
litical force (with corporate state overtones in economic area) which
could compete with existing opposition political parties and conceiv-
ably could become a divisive element within the opposition. He is also
apprehensive that our support to the [less than 1 line not declassified] pri-
vate sector at the present time could be construed as abetting the
coup-minded forces within the opposition and providing tacit [less than
1 line not declassified] approval for a coup. In this context it should be
1
Source: Central Intelligence Agency, DDO Registry, DDO Policy and Manage-
ment Files, 1974, June 25, Job 8000012A, Box 3, Folder 6. Secret; Priority. The message is
printed from a previously redacted copy; the original was examined by the editor but a
copy was not provided for inclusion in this volume.
378-376/428-S/80023
JanuarySeptember 1973 877
noted that while the majority of opposition leaders apparently favor
military intervention, the [less than 1 line not declassified] private sector
(which is most immediately threatened by U.P. economic program) is
in the vanguard of those elements pushing for a coup. Finally, as a
matter of principle [less than 1 line not declassified] is opposed to using
our funds to build up [1 lines not declassified] by using them as con-
duits to support several organizations. He prefers several independent
funding channels to the [less than 1 line not declassified] private sector
even though this approach is less efficient. [3 lines not declassified] in
general however, [less than 1 line not declassified] does not seem to be op-
posed at this time to actions which might intensify or prolong current
political crisis so long as carried out through political parties and the
media.
2. While we share [less than 1 line not declassified] concern about [less
than 1 line not declassified] private sector activities regarding military in-
tervention and are likewise somewhat uneasy about possible competi-
tiveness between political parties (especially PDC) [less than 1 line not
declassified] we feel strongly that financial support to the [less than 1 line
not declassified] private sector is essential. In the past year the [less than 1
line not declassified] private sector has shown itself to be a powerful force
capable of applying pressure on the Allende govt. Moreover it seems to
us that this sector has an even greater potential for impeding U.P. at-
tempt to obtain complete political/economic control of Chile. Hence
we feel (and have felt for sometime) that it is a grave mistake not to at-
tempt to strengthen this force as an effective instrument of the opposi-
tion. If we are to block the U.P. govt, we cannot afford at this time to ig-
nore any viable opposition group capable of applying significant
pressure against the Allende govt.
3. We are now in the process of preparing a memo for [less than 1
line not declassified] consideration which will outline how [less than 1 line
not declassified] requested for the [less than 1 line not declassified] private
sector could be best utilized. [6 lines not declassified]
4. While we expect to encounter difficulties with [less than 1 line not
declassified] on issue of support to [less than 1 line not declassified] private
sector it may be somewhat easier for us than for HQS to try to convince
his counterparts in [less than 1 line not declassified] since Ambassador is
closer to the scene and because of the high level of confidence he has in
the Station. Hence it is our view that it would be better in HQS presen-
tation to [less than 1 line not declassified] to include support to the [less
than 1 line not declassified] private sector in general terms, leaving deci-
sion on specific use of these funds to [less than 1 line not declassified] dis-
cretion especially since exact use of funds will depend somewhat on
local circumstances at any given point in time.
378-376/428-S/80023
878 Foreign Relations, 19691976, Volume XXI
5. [less than 1 line not declassified] was to return Chile 25 June. We ex-
pect to be ready by 29 June to reviewwith [less than 1 line not declassified]
effort and discuss [less than 1 line not declassified] private sector support.
Will advise results soonest.
6. [less than 1 line not declassified]
333. Message From the Station in Chile to the Central Intelligence
Agency
1
Santiago, June 26, 1973.
1. For your information, I used the information that we received
that the opposition leaders were becoming demoralized by the rumor
of a possible deal between Chile and the United States as a peg with
[less than 1 line not declassified] to urge approval of our pending proposal
to [less than 1 line not declassified] as soon as possible. I said I was con-
cerned that this feeling within the opposition could grow if there were
an inordinate delay by [less than 1 line not declassified] in approving the
proposal. [less than 1 line not declassified] said he couldnt agree more
and said he would raise subject with Assistant Secretary.
2. Upon his return [less than 1 line not declassified] said he had dis-
cussed [less than 1 line not declassified] proposal with Assistant Secretary
and while he did not want to make any promises to COS, he felt he had
been able to convince Assistant Secretary of need for program. [less than
1 line not declassified] volunteered information that Assistant Secretary
allowed [less than 1 line not declassified] proposal to be forwarded with
indication that he had seen proposal but without his specific endorse-
ment of it. While continuing to express caution against over optimism,
[less than 1 line not declassified] said he felt Assistant Secretary probably
would now support the proposal.
3. [6 lines not declassified]
4. [less than 1 line not declassified]
1
Source: Central Intelligence Agency, DDO Registry, DDO Policy and Manage-
ment Files, 1974, June 26, Job 8000012A, Box 3, Folder 6. Secret; Priority. The message is
printed from a previously redacted copy; the original was examined by the editor but a
copy was not provided for inclusion in this volume.
378-376/428-S/80023
JanuarySeptember 1973 879
334. Editorial Note
On June 29, 1973, a small number of Chilean Army troops under
the direction of Colonel Roberto Souper attempted a coup against Pres-
ident Salvador Allendes regime. The troops attacking La Moneda (the
Presidential palace) had only four tanks at their disposal. The battle be-
tween the Carabinero troops and the rebels lasted only about three
hours and the pro-government forces emerged victorious. Assistant to
the President for National Security Affairs Henry A. Kissinger in-
formed President Richard M. Nixon of the uprising in two separate
memoranda of June 29. The second memorandum concludes: All indi-
cations are that the coup was an isolated and poorly coordinated effort.
Most of the military leaders, including the commanders-in-chief of all
three branches of the Armed Forces, remained loyal to the govern-
ment. (National Archives, Nixon Presidential Materials, NSC Files,
Box 777, Country Files, Latin America, Chile, Vol. VIII)
In an August 1 memorandum to Kissinger, the CIA assessed the
ways in which a military coup would affect U.S.-Chilean relations and
concluded that a military government would provide additional polit-
ical and social stability for the following reasons: It would at least try
for a symbolic settlement of the copper dispute (the memorandum
noted it would only be an emblematic effort as Chile lacked the funds
to offer a substantial compensation settlement), and it would be more
open to private foreign investment than the Allende government had
been. The overarching concern expressed by the Agency was that, as
the result of ineffective leadership and resistance to the new regime, the
new government might have a hard time maintaining public order.
Consumed with dealing with resistance to the new regime, the gov-
ernment might not fully reverse Allendes more problematic policies.
The August 1 Intelligence Memorandum is Document 139 in Foreign
Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
880 Foreign Relations, 19691976, Volume XXI
335. Transcript of a Telephone Conversation Between the
Presidents Assistant for National Security Affairs
(Kissinger) and President Nixon
1
July 4, 1973, 11 a.m.
K: Hello.
P: Henry.
K: Mr. President.
P: I want you to take the Fourth off now so . . . I just looked over the
news thing, nothing new here. Its relatively quiet. The Latin Amer-
icans are having their usualyou know I think that Chilean guy may
have some problems.
K: Oh, he has massive problems. He has definitely massive
problems.
P: If only the Army could get a few people behind them.
K: And that coup last weekwe had nothing to do with it but still
it came off apparently prematurely.
P: Thats right and the fact that he just set up a Cabinet without any
military in it is, I think, very significant.
K: Its very significant.
P: Very significant because those military guys are very proud
down there and they just mayright?
K: Yes, I think hes definitely in difficulties.
P: Well, we wont have to send the ITT down to help, will we?
K: (Laughs) Thats another one of these absurdities. Because when-
ever the ITT came to us we turned them off. I mean we never did any-
thing for them.
P: I never even knew they came.
K: They came once because Flanigan had set it up. You didnt
know it. I didnt tell you because it required no action and I listened to
them and said Thank you very much and that was that.
P: Frankly you know we left it to Helms and he and the Ambas-
sador and so forth, they screwed it up.
K: Exactly. Its the Ambassador who screwed it up.
P: You remember.
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 378,
Telephone Conversations, Chronological File. No classification marking. The President
was at the Western White House in San Clemente, California and Kissinger was in
Washington.
378-376/428-S/80023
JanuarySeptember 1973 881
K: Oh yes, you remember, if we had in 64 they put $2 million be-
hind Frei.
2
In that election they had altogether $400 thousand which
they split evenly among the opposing parties.
P: Thats a disaster.
K: So it didnt do any good. We might as well have given nothing.
[Omitted here is discussion unrelated to Chile.]
2
Regarding the 1964 election, see Foreign Relations, 19641968, vol. XXXI, South and
Central America; Mexico, Documents 250, 258, 262, and 267.
336. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, July 10, 1973.
SUBJECT
NIE on Chile
Attached per your request is the NIE on Chile, completed last
month before the recent abortive coup.
2
That uprising may have
strengthened Allendes position. Any further unsuccessful move by the
military would certainly do so. In general, however, I believe the recent
events have not substantially altered the conclusions of the NIE.
The NIE focuses on the prospects for consolidation of President Al-
lendes Marxist regime in Chile. It makes the following major points:
While Allende has made important political gains and has the
assets for still further gains, he has not yet consolidated power and is
faced with very substantial problems.
Allende has been particularly effective in controlling his own co-
alition and in dealing with the military, using their apolitical tradition
to his own advantage. He has also been strengthened by divisions
among the opposition parties.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Sensitive. Sent for information. The
memorandum was initialed by Kissinger.
2
NIE 9473, Chile, June 14, is attached but not printed. The NIE is Document 136
in Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
882 Foreign Relations, 19691976, Volume XXI
As a minority President, Allende faces an opposition which con-
trols Congress and is influential in the judiciary, the news media, the
educational system, organized labor and some sectors of the economy.
He also faces a seriously deteriorating economic situation. His
own strategy for consolidating political power creates economic and
political tensions which could ultimately undercut his present gains.
Allende will continue to be unwilling to shore up his economic
position at the cost of an austerity program and taking the necessary ac-
tions to improve relations with the US in order to increase credits from
traditional Western sources. He would probably only agree to pay for
expropriated US companies as part of a package deal including debt re-
scheduling and the opening of new credit lines through international
lending agencies. (An early settlement with Cerro may disprove this
generalization.)
Chile is experiencing an erosion of respect for constituted au-
thority and a polarization of society. This will contribute to a contin-
uing series of political crises and confrontations prior to the next elec-
tions in 1975 (municipal) and 1976 (presidential).
While unrest within the military is growing, sufficiently broad
military support for a successful coup is unlikely unless there should
be: very widespread disorders; complete economic collapse; or a de-
cline in Allendes popular appeal; broad commitment to a coup by the
political opposition and intransigence by Allende in the face of de-
mands from the military.
The NIE posits three broad general directions for events in Chile. It
concludes that a political standoff between Allende and his opposition
is the most likely outcome, with the chances for his consolidating
power or for repudiation of his regime by the opposition being about
equal. The US lacks powerful or reliable levers for influencing the final
outcome. Continued encouragement of constraining forces within
Chile and continuing economic pressures could have some limited im-
pact. But a policy of open, all-out economic pressure would help Al-
lende more politically than it could hurt him economically.
378-376/428-S/80023
JanuarySeptember 1973 883
337. Memorandum From the Assistant Secretary of State for
Inter-American Affairs (Kubisch) to the Under Secretary of
State for Political Affairs (Porter)
1
Washington, July 25, 1973.
SUBJECT
Covert Assistance to Chilean Opposition
In the attached memorandum to the 40 Committee,
2
CIA proposes
that $1,000,000 be approved for the support through FY 74 of political
parties and private sector organizations opposed to the Popular Unity
government of President Allende. Of this sum, [dollar amount not declas-
sified] would be for the Christian Democratic Party; [dollar amount not
declassified] for the National Party; [dollar amount not declassified] for two
smaller parties; [dollar amount not declassified] for private sector organi-
zations for political activity against the UP; and [dollar amount not de-
classified] for contingency purposes.
My initial reactions to this proposal were strongly negative. How-
ever, I have since had repeated meetings and discussions with knowl-
edgeable members of CIA and the Department, including Ambassador
Davis and Deputy Assistant Secretary Shlaudemanuntil recently
DCM in Santiago. The firm views of those I have consulted are that this
financial help is absolutely critical to the survival of an opposition in
Chilewhich is highly important to the United Statesand that al-
though this opposition may not survive in any event, without our help
it will surely vanish from the scene.
Arguments against the proposal are nonetheless sufficiently im-
portant that you should be aware of them in making your decision.
They are:
1) In my view, and in the last analysis, Chile has to save itself.
What help can be given from abroad will only be marginal and, in all
probability, temporary. It is even conceivable to me that the Chilean
opposition may be encouraged by our assistance to depend too much
on us, instead of themselves.
2) The proposal and the amount suggestedwhich I understand is
the maximum that can be safely absorbed under current conditions in
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, 40 Committee Action After September 1970. Secret. Drafted by Gardner; re-
leased by McAfee. Sent through Cline.
2
Attached but not printed. It is published in Foreign Relations, 19691976, vol. E16,
Documents on Chile, 19691973, Document 138. See also Document 340.
378-376/428-S/80023
884 Foreign Relations, 19691976, Volume XXI
Chileseem so small to me that I can hardly see how they will have
much effect.
3) Recent disclosures and allegations about U.S. activities in Chile
in 1964 and 1970, together with current developments and attitudes in
the U.S. towards covert government activities, make the potential
damage to the USG from exposure of this program far greater than in
the past.
4) The damage could also be telling abroad and especially in Latin
America where we are endeavoring to improve our overall relations.
The above considerations have broader implications than just for
Chile alone and I would be glad to discuss them with you further.
338. Central Intelligence Agency Information Report
1
Washington, July 25, 1973.
SUBJECT
Counter Insurgency Planning by Military
[4 lines not declassified]
1. ([less than 1 line not declassified] comment: [less than 1 line not declas-
sified] provided information on a council of five flag-rank officers from
each of the three military services which was established in the after-
math of the abortive military uprising of 29 June to discuss military
concern over national security.)
2. [less than 1 line not declassified] council of flag-rank officers met to
discuss the preparation of a counter-insurgency plan for the Armed
Forces. This plan is near completion and lacks only the identification of
priority targets and a listing of measures requiring inter-service coordi-
nation. Under this plan each of the three branches of the Armed Forces
will have its own organization and responsibilities. Nevertheless, there
will be inter-service groups set up to coordinate those activities re-
quiring joint efforts. ([less than 1 line not declassified] comment: [less than
1 line not declassified] the councils decision to prepare a counter-
insurgency plan.)
1
Source: Department of State, Virtual Reading Room, Document Collections, CIA
Chile Declassification Project. Secret. The report is printed from a previously redacted
copy; the original was not found.
378-376/428-S/80023
JanuarySeptember 1973 885
3. The plotting officers within the Armed Forces are hoping that
the truck owners strike scheduled for 26 July will be postponed until
the council has an opportunity to complete its counter-insurgency plan
which could be used as the basis for a coup detat. For this reason Ad-
miral Patricio Carvajal, Chief of the National Defense staff, tried to
persuade Leon Vilarin, President of the Truck Owners Federation
(SIDUCAM), to postpone his strike until the plan has finished. [18 lines
not declassified]
4. Although the Air Force is not considering any action in conjunc-
tion with the truckers, they plan to remain on alert for a crisis that
might develop as a result of the strike. In the meantime, Navy and Air
Force plotters continue work closely together on their preparations for
a coup detat and neither is planning a unilateral action. [less than 1 line
not declassified] (comment: The plotting officers know of no lower-level
officers plans to undertake independent military action.)
5. [7 lines not declassified]
339. Editorial Note
During the month of July 1973, President Richard M. Nixons ad-
ministration debated whether to re-initiate funding for the Chilean pri-
vate sector organizations, [text not declassified], as they were an impor-
tant sector of the opposition to President Salvador Allendes
government. The Deputy Director for Operations of the Central Intelli-
gence Agency, William E. Colby, sent a June 29 memorandum to the
Chief of the Western Hemisphere Division, arguing that covert funding
of private-sector organizations would prove useful if it could support
the necessary network by which the separate organizations interrelate
and collaborate. (Central Intelligence Agency, DDO Registry, DDO
Policy and Management Files, 1974, Job 8000197A, Box 2, WH Divi-
sion, 1973) Ambassador Nathaniel Davis, however, argued that covert
funding would drive a wedge between the political parties and the pri-
vate sector organizations and that such funding would send a signal to
the military to stage a coup. (Message 25376 from the Station in San-
tiago, June 25; ibid., DO Records [job and volume numbers deleted])
The day after this message was sent to Washington, Ambassador
Davis reconsidered his position. He discussed a plan for passing funds
[text not declassified] with Assistant Secretary of State for Inter-American
Affairs John B. Kubisch during a meeting in Lima, Peru. Although he
believed he had convinced the Assistant Secretary of the need for
378-376/428-S/80023
886 Foreign Relations, 19691976, Volume XXI
passing funds, Davis asked the Chief of Station not to send any infor-
mation on the proposal to Central Intelligence Agency Headquarters
until the Ambassador had a firmer commitment from Kubisch. (Mes-
sage 2539 from the Station in Santiago, June 26; ibid., DDO Registry,
DDO Policy and Management Files, 1974, Job 8000012A, Box 3)
The July 26 inauguration of a strike by the Trucker Owners Feder-
ation forced the issue of U.S. funding [text not declassified] That day, the
Station in Chile reported that funds from an unspecified source were
passed through intermediaries to [text not declassified]. (Message 25763
from the Station in Santiago, July 30; ibid., DO Records, [job and
volume numbers deleted]) A July 31 memorandum for the DDO stated
that covert funding [text not declassified] could greatly hasten economic
disintegration and frustrate government plans to obtain more complete
control of the economy before implementing drastic and unpopular re-
forms. (Ibid., DDO Registry, DDOPolicy and Management Files, 1974,
Job 8000197A, Box 2, WH Division, 1973)
On August 20, the 40 Committee approved funding for the covert
operation, if Davis agreed to release the funds [text not declassified]. (See
Document 342) On August 24, Davis and the Chief of Station decided to
pass a portion of these funds [less than one line not declassified]. (Message
26108 from the Station in Santiago; Central Intelligence Agency, DO
Records [job and volume numbers deleted])
340. Memorandum From the Executive Secretary of the 40
Committee (Ratliff) to the Presidents Assistant for National
Security Affairs (Kissinger)
1
Washington, August 10, 1973.
SUBJECT
Covert Political Action in Chile
As a continuation of our covert political action efforts in Chile, CIA
proposes that $1 million be approved for FY 1974 to strengthen opposi-
tion political parties and private sector organizations to enable them
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
1973. Secret; Sensitive; Eyes Only; Outside System. Sent for action. Concurred in by
Jorden and Kennedy.
378-376/428-S/80023
JanuarySeptember 1973 887
to combat the Popular Unity (UP) Government of President Allende
(TAB A).
2
The UP gained confidence and accelerated its programs after dem-
onstrating considerable support among low income groups in the
March congressional elections. Allende has survived an abortive mili-
tary coup, manipulated the armed forces, controlled dissidents among
his own supporters, and dealt with civilian opposition. Many Chileans
believe the next six months to a year to be especially critical to the sur-
vival of Allende/Marxism.
In contrast, opposition groups have lost some of their confidence
and the private sector is under heavy pressure. But they have not given
up and want to improve their ability to combat Allende/Marxism.
Since January 1971 nearly $6.5 million has been spent in support of the
opposition forces, but it is unlikely they could survive without addi-
tional financial support. Funds would be used to help maintain organi-
zations and media, improve the oppositions electoral support (es-
pecially among low-income groups), and to counter UP efforts to
implement its revolutionary program.
The $1 million total would be divided as follows: [dollar amount not
declassified] for the Christian Democrats, the only opposition party
deemed able to make significant inroads into the UPs electoral
strength; [dollar amount not declassified] for the National Party, which
plans to maintain its inflexible anti-Allende position; [dollar amount not
declassified] for the two radical splinter parties; [dollar amount not declas-
sified] for business, unions and professional groups (under close scru-
tiny of the Ambassador); and [dollar amount not declassified] for contin-
gencies. Funds have not been budgeted and must come from the
Agencys reserve.
State, Defense, JCS and CIA 40 Committee principals concur.
3
Recommendation
That you approve $1 million for FY 1974 support of opposition po-
litical parties and private sector organizations in Chile.
4
2
Attached but not printed. The July 13 memorandum for the 40 Committee is Doc-
ument 138 in Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973.
3
Johnson approved on August 10; see Document 337.
4
Kissinger initialed the Approve option on August 20. The 40 Committee approved
the funding on August 21. (Department of State, Bureau of Intelligence and Research,
INR/IL Historical Files, 40 Committee Minutes)
378-376/428-S/80023
888 Foreign Relations, 19691976, Volume XXI
341. Memorandum From the Chief of the Western Hemisphere
Division of the Directorate of Operations, Central
Intelligence Agency (Phillips) to the Deputy Director for
Operations, Central Intelligence Agency (Karamessines)
1
Washington, August 13, 1973.
SUBJECT
Recent Visit of [less than 1 line not declassified] to Santiago
1. During the period of [1 line not declassified] visited the Santiago
Station. He came away with the following impressions and information
as a result of discussions with the Ambassador, Station personnel and
key sources, and other Embassy officers:
a. The Ambassador feels strongly that the U.S. should not take any
action to encourage the Chilean military to move against President Al-
lende. He thinks the situation is still most fluid, and given Allendes
talents as a politician, he will quite likely finish his term.
b. The Defense Attache estimates that between 80 and 90 percent of
the officer corps of the Army are opposed to Allende. He was also of
the opinion that some 75 percent of all Army personnel are very dissat-
isfied with the present government. He hastened to add, however, that
he believed it was highly unlikely that the Army would move against
Allende so long as the top leadership such as Generals Prats, Pinochet,
Sepulveda, Urbina, Pickering, and Brady remained firm in support of
the constitutional regime.
c. [less than 1 line not declassified] Station source [less than 1 line not
declassified] was of the opinion that Allende could not last another six
months in view of the rapidly deteriorating economic situation and
mounting pressure on him from all sides. He believed the present
truckers strike would continue for several more weeks at least; and
added that he and his colleagues in the Private Sector were supporting
the truckers in what he termed a last ditch, do-or-die effort against Al-
lende. This source, [1 line not declassified], pleaded for U.S. support of
the Private Sector stating that if this sector was not bolstered with out-
side assistance in the immediate future, it would no longer be an im-
portant element in the opposition camp. He estimated that some three
to four hundred additional private firms were taken over by the Al-
lende government following the 29 June abortive coup and said that
this process would continue unless Allende was removed soon. This in-
1
Source: Central Intelligence Agency, Executive Registry, Job 80M01066A, Box 1,
File C7, Chile 1973. Secret. A copy was sent to the ADDO.
378-376/428-S/80023
JanuarySeptember 1973 889
dividual castigated the Christian Democratic Party (PDC) for its indeci-
siveness and said that if the PDC would solidly line up behind the Pri-
vate Sector and the military, Allende could be easily removed.
d. Another [less than 1 line not declassified] of the Private Sector and
[less than 1 line not declassified] figure [less than 1 line not declassified]
stated that the next six months would be critical for Chile and that, if
Allende survived this period, he would probably complete his term
and stand a very good chance of achieving another election victory for
his coalition in 1976. He believed the Army could be pushed into action
against Allende if the present strike movement could be sustained and
extended and if the PDC would firmly throw its support behind the
strikers and the plotting elements in the military.
e. The above [less than 1 line not declassified] source also made a
strong plea for help for his [6 lines not declassified]. We hope to have fur-
ther information on this matter before considering any final decision.
f. Within the next two weeks the Station will be cabling its ideas on
what might be done now to begin laying the groundwork for a major
action program looking toward the 1976 presidential election.
g. It would seem the lower classes in Chile are still firmly sup-
porting Allende. While rampant inflation, shortages of all kinds, and
government inefficiency have seriously affected the middle and upper
classes, somehow the essentials seem to be getting to the lower masses
from which Allende draws his principal support. Certainly, the eco-
nomic situation is going to have to deteriorate far more than at present
before any significant number from the lower classes would consider
leaving Allende.
[3 paragraphs (16 lines) not declassified]
2. [name not declassified] did come away with one paramount im-
pressionnone of our people in Chile has a clear solution to the Al-
lende problem. All feel a sense of frustration. All continue to be im-
pressed by Allendes ability to manipulate and to survive. All agree the
Army is the key piece in the puzzle, but no one knows if and when the
Army might see fit to modify its present constitutional stance.
David A. Phillips
2
2
Printed from a copy that indicates Phillips signed the original.
378-376/428-S/80023
890 Foreign Relations, 19691976, Volume XXI
342. Memorandum From Director of Central Intelligence Colby to
the Presidents Assistant for National Security Affairs
(Kissinger) and the Assistant Secretary of State for
Inter-American Affairs (Kubisch)
1
Washington, August 25, 1973.
SUBJECT
Proposed Covert Financial Support of Chilean Private Sector
1. On 20 August 1973, the 40 Committee approved the expenditure
of [dollar amount not declassified] through June 1974 for support to the
Chilean opposition political parties and the private sector.
2
Of this
amount, [dollar amount not declassified] was allocated to the private
sector and [dollar amount not declassified] to a contingency fund. The 40
Committee specified in its approval that the contingency fund and the
[dollar amount not declassified] allocated to the private sector could only
be spent with Ambassador Davis approval.
2. Chile continues in a state of crisis and the pressures on President
Allende and his government are increasing. Allende and his forces ap-
pear to be on the defensive, fearing a military coup and unsure of their
ability to deal effectively with it if it comes. It is a crucial period in the
revolutionary process being pursued by the Allende government.
While the key to the situation undoubtedly lies with the military, the
left and Allende, the opposition pressure is an essential element of the
picture and encourages the military in its resistance to Allende and the
left.
3
3. Given this situation, the CIA Chief of Station in Santiago on 24
August recommended that covert financial support be given to the op-
position, beginning with a [dollar amount not declassified] payment to the
private sector, in order to keep the pressure on Allende [less than 1 line
not declassified].
4
The Chief of Station discussed his recommendation
with Ambassador Davis with the latter indicating that he could not en-
dorse his proposal, particularly support to the private sector, because
such a course of action could lead to a de facto U.S. Government com-
mitment to a coup which was a policy issue that only Washington
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile
1973. Secret; Sensitive. Sent through Jorden.
2
See Document 340.
3
See Document 338 and Document 138 in Foreign Relations, 19691976, vol. E16,
Documents on Chile, 19691973.
4
Not found.
378-376/428-S/80023
JanuarySeptember 1973 891
could decide.
5
The Ambassador did agree that soundings should be
made in Washington on this matter.
4. The Santiago Station would not be working directly with the
armed forces in an attempt to bring about a coup nor would its support
to the overall opposition forces have this as its objective. Realistically,
of course, a coup could result from increased opposition pressure on
the Allende government. However, the broad consensus of the opposi-
tion appears to have the massive entrance of the military into the Al-
lende government with real power as its present objective.
W.E. Colby
5
See Document 341. A later August 27 memorandum from Phillips to Jorden clari-
fied Colbys memorandum. Phillips noted that Ambassador Davis opposed the CIA pro-
posal to funnel money to the [text not declassified]. Phillips stated, The Ambassadors
concern over providing funds to the Private Sector is because the Private Sector has a
close relationship with elements of the military who are interested in overthrowing Al-
lende. The Ambassador thus believes that any U.S. support to the Private Sector, and par-
ticularly to the [less than 1 line not declassified], could be interpreted as a violation of
present U.S. policy towards Chile which he considers to be one of keeping the pressure
on Allende, but not one of taking action to overthrow him. (Central Intelligence Agency,
Executive Registry, Job 80M01066A, Box 1, File C7, Chile, 1973)
343. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, August 29, 1973.
SUBJECT
Covert Support for Chilean Private Sector
As you know, we have been providing support to opposition polit-
ical parties and [less than 1 line not declassified] elements of the media
who oppose Marxist President Allende and his programs. This sus-
taining action has been highly useful in keeping democratic elements
active and effective. In the attached memo, CIA suggests a new pro-
gram that would expand our support to certain elements of the private
1
Source: National Security Council, Nixon Intelligence Files, Subject Files, Chile,
1973. Secret; Sensitive; Eyes Only; Completely Outside the System. Sent for action. A
handwritten notation at the top of the memorandum reads, OBE?
378-376/428-S/80023
892 Foreign Relations, 19691976, Volume XXI
sector[3 lines not declassified].
2
This would move us into new territory,
dealing with untested and much less sophisticated groups than we
have been supporting. The purpose of the new program, which would
be modest at the outset ([dollar amount not declassified] is suggested),
would be to keep the pressure on Allende and sustain some of the
present strikes.
Ambassador Davis does not endorse the proposal.
3
He believes
this course of action could lead to a de facto U.S. commitment to a coup.
He thinks the chances of exposure are significant and that those
Chileans who learn of what is happening, or even suspect it, will take it
as a signal that we want a coup. They will expect more where that
came from. And, with some military elements with whom they have
contacts, be tempted into rash actions on the assumption that they
would have quick and effective U.S. support.
The Ambassador believes (correctly) that present U.S. policy is to
keep the pressure on, but not to take action in overthrowing Allende.
He believes the new proposal would move us toward the latter.
Our present actions are well concealed. I am not persuaded that
the newly suggested action would enjoy that same immunity. More-
over, I think there is high risk, not only of exposure, but of triggering
events that could be bloody as well as ineffective. That is a bad
combination.
It is not going to help us, or the opposition in Chile, if word gets
around at this time that the U.S. is backing a coup. It would play into
Allendes hands. One further consideration: a coup against Allende,
however immediately attractive to us, will probably make a martyr of
him in the eyes of many Chileans and leftists in the hemisphere. Mean-
time, he is presiding over the gradual but steady deterioration of
Chiles economy and political order. This lesson has not been lost on
other governments that, at one time, were inclined to look on the
Chilean experience as a likely model for their future development.
Now they are disillusioned. That attitude will deepen as Chiles down-
ward spiral continues.
Thus, I see the issue as: Do we take a rather high-risk move that
promises little real success but rather carries the danger of triggering
bloodshed through misinterpretationand may strengthen Allendes
hand?
My recommendation is no. But I would hold this proposal in re-
serve, a time may come when we can do it with less risk of exposure
and without signalling coup. We have an interest in keeping some of
2
Document 342.
3
See Document 341 and footnote 2, Document 342.
378-376/428-S/80023
JanuarySeptember 1973 893
the groups concerned alive and well. This might require extending a
helping hand between periods of crisis and high tension when their
survival is most endangered. We also need better assurances from CIA
that working with new and untested individuals and groups can be ac-
complished with relatively good security.
Thus, I would go back to Santiago with the message: Not now.
But lets keep the option open. We would be receptive to the Ambas-
sadors and Missions recommendation for implementation when they
consider it would be helpfulwithout giving a misleading signal as to
our support for a violent solution.
Dick Kennedy concurs. Jack Kubisch also supports this course.
Recommendation
That you approve a message to Santiago along the lines of the pre-
vious paragraph.
4
4
There is no indication that Kissinger approved or disapproved the
recommendation.
344. Memorandum From the Deputy Director for Coordination,
Bureau of Intelligence and Research (McAfee) to Director of
Operations, Bureau of Intelligence and Research (Gardner)
1
Washington, September 7, 1973.
SUBJECT
ARA/CIA Meeting, 7 September 1973, 11:00
PARTICIPANTS
ARAMessrs. Kubisch, Shlaudeman and Amb. Bowdler;
CIA[names not declassified]; INRWilliam McAfee
Chile
Mr. Kubisch said he had met recently with the Acting Secretary for
a discussion of Chile, that as the Department now see it our options are:
if Allende continues on a hard line, we will continue our current ap-
proach; if Allende moderates, we will consider moderating our stance;
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Chile 19731975. Secret. Drafted by McAfee on September 11.
378-376/428-S/80023
894 Foreign Relations, 19691976, Volume XXI
if there should be a coup attempt, which appears likely to be successful
and satisfactory from our standpoint, we will stand off; if there should
be a coup, which might be viewed as favorable but which appears in
danger of failure we may want a capability for influencing the situa-
tion. Mr. Kubisch asked [name not declassified] to give this problem at-
tention and raise it for consideration at a later meeting.
[name not declassified] doubted at this point that there would be a
military coup but indicated the possibility of a creeping coup. Mr.
Shlaudeman for his part did not think a creeping coup [i.e., a constitu-
tional thwarting of UP objectives by military cabinet members]
2
was
too likely and felt that if circumstances continued to deteriorate an
armed coup might be likely.
[Omitted here is discussion unrelated to Chile.]
2
Brackets in the original.
345. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 8, 1973, 1705Z.
4059. Subj: Waiting For the Boot To Drop. Ref: Santiago 4056.
2
Summary: Military intentions dominate interest all observers, as
Navy command crisis remains unresolved and intense arms searches
by military lead to serious shooting for first time. Pres Allende meeting
with UP leaders and CINCs. Anti-government strikes continue, as
worsening bread shortage leads to takeovers of bakeries by frustrated
customers. Closed PDC meetings of last few days produce no public re-
sults. Bomb explosions at Governors offices Aconcagua and telecom-
munications relay tower serving south Chile. End summary.
2. Detailed reports appeared in morning press 9/8 of meetings yes-
terday of Navy Admirals with CINC Admiral Montero, and Min Def
Letelier, and Admiral Merino with Pres Allende. Sept 8 am radio re-
ports Allende will meet am with UP leaders, pm with military CINCs.
According LA Prensa, (PDC), Admirals in line refused accept CINC
1
Source: National Archives, RG 59, Central Foreign Policy File, [no film number].
Limited Official Use; Immediate.
2
Dated September 7. (Ibid.)
378-376/428-S/80023
JanuarySeptember 1973 895
post, demanded appointment first-in-line Merino. Squadron com-
mitted to Unitas exercise remains in Valparaiso, with public reports of-
ficers and crews refuse sail until Montero resigns and Merino ap-
pointed. MinDef Letelier quoted as angrily stating squadron will sail
Monday 9/10. Meanwhile intense arms searches by military continued.
FACh raided Sumar textile plant Santiago 9/7 and met sniper fire.
Three civilians reported wounded, two more in passing car injured
when they failed heed FACh orders to stop, ten arrested. In other inci-
dents, Marines allegedly invaded kindergarten in Lenin neighbor-
hood in Talcahuano, causing death by heart failure of old woman,
while Army raided construction site in Rancagua and factory in San-
tiago. On 9/6 Navy searched GDR ship in Valparaiso to inspect relief
supplies sent by GDR, without result except threat of protest by GDR
Ambassador and outrage of UP press.
3. Transport and merchants strikes continue, while medical strike
apparently ended with agreement with government protested by some
medical elements (reftel). Government held to hard line with threats by
MinEcon Cademartori to cut all supplies to establishments not hon-
oring contracts and to funnel food supplies to neighborhood organiza-
tions, state organs, and cooperative merchants. MinInt Briones told
Senate Public Works Committee Congress has no authority to legislate
on transport strike. Municipal employees of Providencia, Las Condes,
and Nunoa, upper and middle class districts in Santiago, reportedly
joined strike in support guilds. Bread shortage appears to be wor-
sening, with wheat stocks at Port San Antonio cut off by bombing of
rail line to Santiago. There were several reports of Santiago bakeries in-
vaded by mobs seeking bread.
4. PDC leadership has been meeting in long, closed sessions with
no public statement, except SecGen Cerda comment 9/7 that PDC de-
cision might come soon. Other sources quoted to effect PDC may ini-
tiate impeachment proceedings Monday 9/10 against MinInt Briones,
MinEcon Cademartori, MinAgric Toha, MinJust Insunza for various
failures covered in 8/22 Resolution Chamber of Deputies.
3
The PS will
rally Sunday 9/9 in support of Navy personnel held for anti-golpista
(i.e. subversive) activity, and of PS SecGen Altamirano who object court
action by Navy.
5. Incidents of violence continued, including bombing of telecom-
munications relay tower in OHiggins Province cutting off south from
Santiago for estimated 24 hours, and bombing without injuries of pro-
vincial Governors office in Aconcagua.
3
The August 22 resolution accused Allende of overstepping the Constitution and
the law. (Chiles Labor Federation Bids Members Defend Constitution: Chamber Ac-
cuses Allende, New York Times, August 23, 1973, p. 3)
378-376/428-S/80023
896 Foreign Relations, 19691976, Volume XXI
6. Leftist press continues heavy play on intentions of arrested
Patria y Libertad Chief Roberto Thieme, including his alleged plans to
call in US Ranger instructors, and to establish clandestine airfields
for connections with supporters in Bolivia.
Thompson
346. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 11, 1973, 12:30 p.m.
SUBJECT
Coup in ChileSituation Report
At approximately 6:30 A.M. today the Chilean Armed Forces and
the National Police launched joint operations against the Government
of President Allende of Chile. In a proclamation broadcast over opposi-
tion radio stations, the Commanders-in-Chief of the Army, Air Force
and National Police and the Chief of Naval Operations called on Presi-
dent Allende to resign immediately. The proclamation said that the
armed forces and the police are united in their anti-Marxist fight
against an incompetent government which is leading the country to
chaos. It assures the workers that the social and economic gains they
have made will not be lost; and it orders all pro-government media to
stop broadcasting.
President Allende arrived at the Presidential Palace at 0730 with
extra heavy police guard and armored cars. In a broadcast message, he
said he would not resign and called on the workers to occupy their
places of work.
All telecommunications between Santiago and the outside world
have been interrupted and airports have been closed by the military.
Chilean Air Force planes have reportedly strafed at least one pro-
government radio station which refused to obey the armed forces order
to transmit only via the military network. The Navy secured control of
the port of Valparaiso by 0840 today without encountering any armed
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Sensitive. Sent for information.
Printed from an uninitialed copy.
378-376/428-S/80023
JanuarySeptember 1973 897
resistance. The entire country is reported to be under the control of the
Armed Forces. The only exception is the Presidential Palace in Santiago
where elements of the National Police loyal to Allende are apparently
still holding out. According to late reports from our Embassy in San-
tiago, Army troops were seen entering the Palace at approximately
twelve noon and smoke was rising from the Palace which had been
under Chilean Air Force attack.
347. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 11, 1973, 5 p.m.
SUBJECT
Coup in ChileSituation Report
The Chilean Armed Forces have apparently carried out a suc-
cessful coup against Marxist President Salvador Allende. An uncon-
firmed report from Santiago says that Allende has committed suicide in
his office in the Presidential Palace.
2
A defiant (and reportedly drunk) Allende finally accepted defeat
after Chilean Air Force planes bombed the Palace. The building was set
afire and reports from the scene indicate it was virtually destroyed.
There has been sporadic sniper fire in downtown Santiagoap-
parently from Allende supporters. But preliminary indications are that
the loss of life has been small.
The junta of military leaders that claims full power is taking a
strong stand against any resistance. It has also insisted that persons
with arms turn them in or suffer the consequences. A state of siege has
been declared and a tight curfew imposed.
Thus far, the new junta has given no indication of the general line
it intends to follow nor has it made any announcement of its intention
to carry out new national elections.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Sensitive. Sent for information. A
stamped notation on the memorandum indicates the President saw it.
2
The Embassy sent a translation of Allendes final statement in telegram 4092, Sep-
tember 11, 1415Z. (Ibid., RG 59, Central Foreign Policy File, [no film number]) For an ex-
amination of the evidence on the nature of Allendes death, see Davis, Last Two Years, pp.
277306.
378-376/428-S/80023
898 Foreign Relations, 19691976, Volume XXI
The military leaders have ordered all Allende government officials
and coalition party leaders to turn themselves in by 4:30 p.m. today or
face severe consequences.
348. Minutes of a Meeting of the Washington Special Actions
Group
1
Washington, September 12, 1973, 10:1010:45 a.m.
SUBJECT
Chile
PARTICIPANTS
ChairmanHenry A. Kissinger CIA
William Colby
State
David Phillips
Kenneth Rush
Jack Kubisch NSC
B/Gen. Brent Scowcroft
Defense
Lawrence Eagleburger
V/Adm. Ray Peet
Richard Kennedy
Robert F. Corrigan
William Jorden
JCS
Jeanne W. Davis
V/Adm. John Weinel
SUMMARY OF CONCLUSIONS
It was agreed that:
. . . a comprehensive paper should be prepared by AID and Treas-
ury, with CIA assistance, on what is needed by way of economic assist-
ance and the options on debt rescheduling;
2
. . . Ambassador Davis should inform the new regime that we are
well-disposed toward it, but that it would not be in our mutual interest
if we were the first country to recognize it;
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H94, WSAG Meeting, Chile 9/12/73. Secret; Nodis. Jeanne
Davis sent the minutes to Kissinger under cover of a September 13 memorandum. A copy
was sent to Eagleburger, Kennedy, and Jorden. (Ibid.) The meeting took place in the
White House Situation Room. The minutes were misdated September 13; an unknown
hand corrected the date to September 12. Kissingers Record of Schedule confirms that
the WSAG met on September 12 at 10:10 a.m. (and not on September 13.)
2
A reference to the paper, Economic Assistance Needs of the New Chilean Gov-
ernment and Possible Responses. For the September 13 paper, see Foreign Relations,
19691976, vol. E16, Documents on Chile, 19691973, Document 143.
378-376/428-S/80023
JanuarySeptember 1973 899
. . . we should take the public position that we recognize gov-
ernments, not heads of government, and that question of recognition
has not arisen; if asked, we should deny any CIA involvement; if asked,
we should say our defense equipment programs are continuing on a
routine basis and that anything going to Chile is in fulfillment of ex-
isting obligations undertaken with the Allende government;
. . . Ambassador Davis should raise with the Chileans the visit of
the Air Force Thunderbirds;
. . . the President will be asked for a decision on the US ships in-
volved in Exercise UNITAS;
. . . our Ambassador in Rio should discuss the situation with the
Brazilian Government;
. . . CIA will prepare a paper for Mr. Kissinger on activities in Chile
over the last three years.
3
Mr. Kissinger: The principal purpose of this meeting is just to be
sure we all say the same thing and that we all know where we are
going. (to Mr. Colby) Would you brief us?
Mr. Colby briefed from the attached text.
4
Mr. Kissinger: Do we have communications, or were they cut?
Mr. Colby: We have communications.
Mr. Kissinger: (in response to a briefing comment that Admiral
Leigh disliked the Christian Democrats) Whom does he like?
Mr. Colby: Hes to the right of the Christian Democratsfavors
the Nationalists.
Mr. Kissinger: (In response to a comment in the briefing) Why did
the Chileans attack a Cuban ship leaving Valparaiso?
Mr. Colby: They thought it might have some of Allendes people
on it.
Mr. Rush: Wasnt it violating the militarys order that no ships
should leave port?
Mr. Colby: Yes.
Mr. Rush: Havent the Cubans been supplying some arms to Al-
lende? They might have had some arms aboard.
Mr. Colby: Yes.
Mr. Kissinger: (to Mr. Rush) Does State have any observations?
Mr. Rush: We think this offers us an opportunity to avoid what
happened after Goulart was deposed in Brazil in 1964. At that time the
President sent cables of congratulations to the new government imme-
3
The CIA paper is Document 145, ibid.
4
Not found.
378-376/428-S/80023
900 Foreign Relations, 19691976, Volume XXI
diately and everything we did made it appear that we were behind the
coup.
5
Mr. Kissinger: The President is worried that we might want to
send someone to Allendes funeral. I said I didnt believe we were con-
sidering that.
6
Mr. Rush: No, not unless you want to go. We think we have a real
opportunity to keep our hands off and to develop really good relations
with the new government. It would be in our best interests not to be a
part of it or even appear to be a part of it. It was a true national effort.
The chances are that they will probably turn first to Brazil for aid, and
we think this would be good for us, too. I should mention Exercise
UNITAS which is a joint US-Chilean naval exercise with three U.S. de-
stroyers and one submarine involved.
Mr. Kissinger: But there were no American ships anywhere near
Chile, were there?
Mr. Rush: Their next stop was to be Santos on October 2. I think the
ships should go back up north.
Mr. Kissinger: I agree.
Mr. Kubisch: The biggest errors we have made in Latin America in
recent years have involved too hasty recognition of military regimes
in Brazil, for example. Also, this has created the biggest handicap for
the country concerned. I believe we have twin objectives. This promises
to be a very effective government. I think, privately, we should be
forthcoming and cooperative and do what we can to help stabilize their
economy and give them the assistance they need. Publicly, we should
avoid a too quick, affectionate embrace and any impression that we had
any involvement in the change. An allegation that American ships were
in Chilean waters can do considerable damage for years to come.
Mr. Kissinger: I agree. (to Adm. Weinel) What do you think?
Adm. Weinel: Chilean waters dont go all the way to Australia. I
dont think every time there is a coup that it should influence our right
to the high seas.
Mr. Kissinger: This isnt a question of our right to the high seas.
This is the question of risk of an act of choice; how it will look if there is
a pro-American coup, or at least one favorable to the US, to have Amer-
ican ships nearby.
Adm. Weinel: That might not be a bad conclusion to draw in cer-
tain areas.
5
See Foreign Relations, 19641968, vol. XXXI, South and Central America; Mexico,
Document 207.
6
See footnote 3, Document 349.
378-376/428-S/80023
JanuarySeptember 1973 901
Mr. Kissinger: But not in Chile.
Adm. Weinel: I was thinking of third countries.
Mr. Kissinger: Well get credit for this anyway.
Mr. Colby: More than we want.
Mr. Kissinger: But thats not the worst disaster that could befall.
Adm. Peet: Our ships would be out of sightover 200 miles off the
coast. Their presence would give us some options if we wanted them.
Mr. Kissinger: To do what?
Adm. Weinel: This is a political decision entirely.
Mr. Kissinger: I cant conceive of a circumstance in which three de-
stroyers would be used, no matter what happens. Where are they now?
Adm. Weinel: Theyre on their way to Cape Hornjust south of
the Peruvian border.
Mr. Rush: We want as little civil war on resistance in Chile as pos-
sible. We dont want to give the various sides any excuse for lining up
against each other. We want even the anti-American groups to back the
new regime.
Mr. Kubisch: There was an AP report this morning of an Angela
Davis rally in which she said US naval vessels were off the coast of
Chile. When Defense was queried about it, they said there was a joint
naval exercise with Chile but it had been cancelled. I dont think we
should say there was any US navy off the coast.
Mr. Rush: Allende is scheduled to become a martyr. Thats why he
committed suicide.
Mr. Kissinger: Losers dont become martyrs in Latin America.
Mr. Rush: Some do.
Mr. Kissinger: Who?
Mr. Corrigan: Che Guevara.
Mr. Kissinger: Did Allende really commit suicide or was he killed?
Mr. Colby: Our evidence points to suicide.
Mr. Kissinger: I have just spoken to the President on recognition.
He agrees we should not rush in as the first country to recognize. Hope-
fully a Latin American country would be the first, but we should en-
courage them to do so.
Mr. Rush: In the cases of Afghanistan and the coup in Greece that
deposed Constantine we just said the issue didnt arise.
Mr. Kissinger: Do we have to recognize?
Mr. Rush: No.
Mr. Kubisch: Its a constitutional question. If the new regime is
constitutional the President of the Senate, who is Frei, becomes Presi-
378-376/428-S/80023
902 Foreign Relations, 19691976, Volume XXI
dent and elections are held within 90 days. If it is unconstitutional there
are supposed to be consultations.
Mr. Kissinger: Do we have to interpret the Chilean constitution?
Mr. Kubisch: No.
Mr. Kissinger: We could wait for one or two Latin American coun-
tries to recognize then try to get one or two European countries, and
possibly, Japan, to join us in recognition.
Mr. Corrigan: I just went through a coup situation in Rwanda
which was completely unconstitutional but applauded by all. The
Germans, French, etc. all said they recognized countries, not gov-
ernments. You will have no problem with them.
Mr. Kissinger: We can say that too.
Mr. Kubisch: They need to ask for recognitionto say they want to
continue or renew diplomatic relations with us.
Mr. Kissinger: What instructions does (Ambassador) Davis have?
Mr. Kubisch: To report any contact from the new government.
Mr. Rush: When they contact us, we will recognize them.
Mr. Kubisch: But we shouldnt be among the first.
Mr. Kissinger: Were all shell-shocked here by Senator Church and
the press. Does Davis understand he can let the government know we
are well disposed toward it?
Mr. Kubisch: He can do it informally.
Mr. Kissinger: Just so he doesnt say, when they approach him,
that he will have to check with Washington. He could say he will have
to get instructions on the formalities. He could also say that for our
common interest we would like not to be the first to recognize.
Adm. Weinel: Isnt this a special type of coupthis isnt your reg-
ular garden-variety Latin American coup. Isnt there a connection be-
tween the type of coup and the nature of our recognition?
Mr. Rush: We could save a lot of trouble if we have a policy of rec-
ognizing governments, not heads of governments. In that case, nothing
is called for. In a low key, we could just resume relations.
Mr. Kissinger: The major problem would be if Davis takes a
hands-off attitude when they approach him. That might put them off.
Lets have him tell them now that we are well-disposed to them and
want to be helpful. Our preference is to treat the situation so as to make
no new action necessary. We will take a low-key public posture.
Mr. Rush: Exactly. Well get a cable off at once.
7
7
Telegram 183116 to Santiago, September 14. (National Archives, RG 59, Central
Foreign Policy File, P7500140797)
378-376/428-S/80023
JanuarySeptember 1973 903
Mr. Kissinger: Lets get a look at it. We have a press briefing today.
What do we say?
Mr. Kubisch: That this is an internal development in Chile. That
the US is watching it closely. That there has been no damage to Amer-
ican property or harm to American citizens.
Mr. Kissinger: And if they ask if we will recognize this gov-
ernment, we will say the issue is not raised. That our basic position is
that we recognize countries, not heads of governments, and that we
need more information before we can be more specific.
Mr. Colby: And we should say that CIA did not stimulate or sup-
port the coup.
Mr. Kissinger: Only in answer to a question. If asked about supply
of military equipment, we should say we are continuing shipments of
all regularly scheduled equipment which was based on agreements
made with the Allende government. We should say nothing new has
been added to our existing programs. If questioned on CIA, say they
had nothing to do with it. But dont stimulate a question.
8
Mr. Colby: God, no!
Mr. Rush: What about UNITAS?
Mr. Kissinger: Ill get an answer from the President on that within
a half-hour.
9
Adm. Weinel: We can say our ships are completely clear of Chilean
waters.
Mr. Kubisch: This could be a plus. Our ships had already set sail
fromport to meet with the Chilean Navy units, and when we learned of
the coup we cancelled their orders.
Mr. Kissinger: Why not say so? That this was a regular exercise;
that our ships were supposed to meet Chilean ships, but when we
heard about the coup we cancelled their orders.
Mr. Kubisch: On the question of recognition, we could base our po-
sition on the establishment of relations with a new government, not
recognition. We are waiting for the new government to establish itself
and to approach us.
Mr. Kissinger: For today, I think it best to set our philosophical po-
sition. We recognize the governing body of the country. We took that
position recently in Afghanistan and in Greece. The specific issue
8
The verbatim text of the portion of the September 12 briefing concerning Chile
was sent to the Embassy in telegram 181843 to Santiago, September 13. (Ibid., [no film
number]) See also U.S. Had Warning of Coup, Aides Say, New York Times, September
13, 1973, p. 18)
9
See footnote 3, Document 349.
378-376/428-S/80023
904 Foreign Relations, 19691976, Volume XXI
hasnt arisen in Chile since the Chilean authorities have not yet con-
tacted our Embassy.
Mr. Colby: This is consistent with our relations with China.
Mr. Rush: Thats the best thing to say. We dont have to take a de-
finitive step.
Mr. Kissinger: Our defense programs will continue on a routine
basis. We will fulfill all obligations undertaken with the Allende
government. Anything going to Chile is in fulfillment of existing
obligations.
Adm. Peet: We have some LSTs and trucks going. Also, on Sep-
tember 25, we were scheduled to send the Thunderbirds therean Air
Force demonstration flight team.
Adm. Weinel: Thats a very high-visibility item.
Adm. Peet: Should we cancel it?
Mr. Kissinger: If we cancel it now, wont it look like a slap in the
face? Has it been announced?
Adm. Peet: Yes.
Mr. Kissinger: What is the occasion?
Adm. Weinel: It is part of a tour of South American countries, not
just Chile.
Mr. Rush: We shouldnt not do for this government what we were
prepared to do for Allende.
Mr. Kissinger: Why dont you raise it again in a week. Ask Davis to
raise it with the Chileans. They will certainly ask for economic aid. Can
we get a paper from AID and from Treasury. They have a debt resched-
uling problem.
Mr. Colby: Yes, a bad problem.
Mr. Kissinger: (to Gen. Scowcroft) Lets get a paper from Treasury
on the options on the debt. State should get from AID what is needed in
the way of economic assistance. Then well decide how to do it.
Mr. Colby: They have enough flour for a month or so, then they
will have to import more.
Mr. Kissinger: Have we any flour to give them?
Mr. Kubisch: They have asked Argentina for wheat, and they have
some for them. It would be better if they can get as much multilateral
support as possible.
Mr. Kissinger: As long as the Chileans understand that we are the
driving force behind the multilateral assistance.
Mr. Rush: Multilateral assistance never appealed to me too much.
If they ask us, we should respond on our own and get the credit for it.
Mr. Kubisch: I meant we should cooperate with the Australians
and the Argentinians and others to see they get flour if they need it, but
378-376/428-S/80023
JanuarySeptember 1973 905
all bilaterally. One-third of the country is still pro-Allende. The new re-
gime wont want to get too closely associated with us.
Mr. Kissinger: Thats their decision. If they want bilateral aid from
us we shouldnt say they should seek multilateral aid.
Mr. Kubisch: Right.
Mr. Kissinger: Should we talk to the Brazilians about this? Do they
still have that Ambassador here?
Mr. Kubisch: Yes, Castro.
Mr. Kissinger: Maybe it would be better to talk in Brazil.
Mr. Kubisch: Yes, Crimmins could talk to Gibson Barboza.
Mr. Kissinger: Lets get a comprehensive paper from Treasury and
AID so that not every agency is sending stuff in separately. I agree we
shouldnt look like we are pouring aid in. We should also get some-
thing from CIA.
Mr. Kubisch: One problem is the question of uncompensated ex-
propriation. We should make it clear that we want to establish some
good faith negotiations.
Mr. Kissinger: It would not be in the US interest to get them to re-
verse too much. I doubt they will, anyhow. We should not come back in
as the American exploiters, but they should be made to understand
what we are after. Well have a brief meeting on Friday.
10
Adm. Peet: We have 300 Chileans in various military training pro-
grams, some in the Canal Zone and some in the US.
Mr. Kissinger: Just dont send any back right now. (to Mr. Colby)
Could you send me what we have done in the last three years there so I
have all the facts. State should make sure that Davis and we dont pro-
test too much. What Mr. Kubisch has described is just right.
Mr. Kubisch: Our policy on Allende worked very well.
Mr. Kissinger: Well get the credit for this anyway. Well meet
Friday at the same time.
Adm. Weinel: What about the ships? Should they turn around?
Mr. Kissinger: Ill check with the President, but my guess is that he
will want them to turn around.
10
September 14. See Document 353.
378-376/428-S/80023
906 Foreign Relations, 19691976, Volume XXI
349. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 12, 1973, 12:30 p.m.
SUBJECT
Chilean DevelopmentsSituation Report
Intensive shooting and explosions were heard late this morning in
downtown Santiago and in outlying industrial areas. A radio station
controlled by the junta said that extremist groups continue to resist
the action of the Armed Forces in downtown Santiago. There is no
hard information as yet concerning the scale of the fighting, although
ham operators monitored in Buenos Aires report many deaths re-
sulting from serious confrontations between army troops and factory
workers in the suburbs of the capital.
The military radio network is still Chiles sole source of informa-
tion. There has been no official mention of Allendes fate, despite unof-
ficial reports of his death, probably by suicide.
Press reports quote Mexican President Echeverria as expressing
deep regret at the coup. Echeverria stressed Mexicos loyalty to the
principle of non-intervention and expressed solidarity with the people
of Chile and confidence that Chile would soon find again the way for a
democratic and peaceful life. Echeverria offered asylum in Mexico to
Allendes supporters.
2
The WSAG met this morning and based upon those deliberations
we are adopting a public line that this is an internal situation in Chile
and that as to the question of recognition the issue has not arisenin
any event, we do not recognize individual governments, but rather
countries. We will keep a low-key posture to allow time for Latin
American governments and possibly some Europeans to announce the
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Secret; Sensitive. Sent for information. A
stamped notation on the memorandum indicates the President saw it.
2
Mrs. Allende took asylum in the Mexican Embassy. Davis cabled the Department
that unless he heard otherwise from Washington, he would send the following condo-
lence letter to her: Dear Ms. Allende, my wife Elizabeth and I wish to express to you our
sympathy over the death of your husband, President Allende. We were saddened to
learn of it. Over the almost two years I have been in Chile, I came to know President Al-
lende in a wide variety of formal and informal situations and came to appreciate his
many qualities and to be grateful for the understanding he expressed to me on many oc-
casions. Elizabeth and I have also been grateful for your generous gestures to us both. Re-
spectfully yours. (Telegram 4198 from Santiago, September 13; ibid.)
378-376/428-S/80023
JanuarySeptember 1973 907
continuation of their relations
3
before we make any direct statements in
order that we can defuse any charge of our implication which would
not only be damaging to us, but more importantly to the new Chilean
Government. We will, however, have Ambassador Davis discreetly let
the new leadership know informally that we are favorably disposed.
4
We are preparing a list of possible responses to likely aid requests
which we can anticipate at an early point from the new Chilean
Government.
3
Nixon highlighted and underlined this phrase and wrote at the bottom of the
page, K[issinger]goodas we discussed it. According to the Presidents Daily Diary
and Kissingers Record of Schedule, the two men met three times on September 12:
9:3110:05 a.m. in the Oval Office; 1:131:18 p.m. in Kissingers Office; and 6:166:30 in
the Oval Office. In addition to events in Chile and elsewhere, Kissinger was preoccupied
with the process of confirmation in the Senate of his appointment as Secretary of State.
No substantive records of the conversations between Nixon and Kissinger on September
12 have been found.
4
Nixon underlined this sentence.
350. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 12, 1973, 1840Z.
4154. Subj: Gen Pinochets Request for Meeting with MilGp Of-
ficer. Ref: State 181000.
2
Following is summary of subject meeting:
1. Gen Pinochet said he was using Col Urrutia as intermediary to
give me message in view of delicacy of matter of contact at this moment
in time. He showed understanding and was relaxed about matter of
recognition and volunteered that obviously we should not be first to
recognize. He showed same recognition of advisability of not too much
public identification with US at moment. (Comment: On these issues he
seems to be reacting about as well as he could.)
2. Gen Pinochet is President of Junta and will probably continue to
be so for at least a year.
1
Source: National Archives, RG 59, Central Foreign Policy File, P7500112152. Con-
fidential; Exdis; Flash.
2
Dated September 12. (Ibid., P7500140928)
378-376/428-S/80023
908 Foreign Relations, 19691976, Volume XXI
3. Junta government intends break relations with Cuba, USSR,
North Vietnamese and North Koreans. Government also intends to
clean out UP militants from Chilean diplomatic missions abroad.
4. Regarding relations with US, fundamental Junta desire is to
strengthen and add to traditional friendly ties with US. Junta would
hope that we could see our way clear to giving them relief for one year
on Chiles debt with US. (Comment: It was not clear whether he meant
in context Paris Club.) He noted Junta would need a year to straighten
things out.
5. Military government intends to honor Chiles obligations re-
garding the copper debt and will be looking forward to trying to work
out a mutually acceptable solution with US. (Comment: It was not clear
whether Pinochet was referring to both debt and equity and my guess
is that he was being general in his reference and has not yet addressed
the specifics of the problem.) Pinochet also said that Junta hoped that
we would be able to help them supply food for their peopleclearly al-
luding to wheat as a first need but also including other food products.
6. He expressed continuing keen interest in the M60 procurement.
In this connection, as a historical footnote, he mentioned that Allende
had been pressing Army very hard in recent days to buy Soviet equip-
ment and mentioned that Gen Prats had actually signed some agree-
ments in this regard when he was Army CINC. He said that in
strengthening military resolve against such procurement, the Altami-
rano speech (Santiago 4072)
3
had helped just as it had contributed to
catalyzing the events of Sep 11.
7. Gen Pinochet also referred to the fact that he and his colleagues
had not even hinted to us beforehand of their developing resolve to act
and said he thought it had been better that way. He commented that
what was done had to work.
8. Toward the end of the conversation Gen Pinochet invited sev-
eral other Generals into the room (Bonilla, Alvarez, Lutz and Urbina)
and Col Urrutias impression was that the Generals are pleased at the
way things are going. Today they are cleaning out the snipers and es-
sentially see their problem as one of isolated pockets of resistance and
snipers.
9. The military government intends to declare the two big UP
parties illegal and also the smaller groups such as the MIR, MAPU and
IC. General Pinochet remarked at one point that it seems that the North
Korean Embassy is filling up with asylees.
3
Dated September 10. (Ibid., [no film number])
378-376/428-S/80023
JanuarySeptember 1973 909
10. Regarding arrangements for the future, Urbina will continue as
Army Chief of Staff and Acting CINC and Bonilla will be SecGen of
government.
4
Davis
4
The Department of State sent a response to Pinochets overture welcoming his de-
sire for strengthening ties with the United States and agreeing that it was best initially to
avoid too much public identification between us. (Telegram 182051, September 13; ibid.,
P7500140839) It was delivered to Pinochet through the Embassy Military Group Army
Section Chief. (Telegram 4195 from Santiago, September 13; ibid., P7500112150)
351. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 13, 1973, 9 a.m.
SUBJECT
Chilean DevelopmentsSit Report
The Military Junta and the new Cabinet were formally sworn in at
9:50 p.m. September 12. The four service chiefs took the oath as the gov-
erning Junta, with Army Commander-in-Chief General Pinochet as
President. The Cabinet is composed largely of military officers. Only
the Ministers of Education and Justice are civilians. The new Minister
of Foreign Affairs is Rear Admiral Huerta. Our Embassy reports that,
as of midnight September 12/13, no firing had been heard in down-
town Santiago for several hours. There are no reports from industrial
areas where the possibility exists of continued conflict. The situation in
the rest of the country appears stable. The total curfew in Santiago has
been extended until noon, September 13 and is scheduled to take effect
again at 1830.
The Christian Democratic Party (PDC) and the Social Democrats
(PSD) have apparently decided to issue statements of support for the
Junta as soon as possible. Supreme Court President Urrutia has pub-
licly expressed his support in a radio broadcast.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Confidential. Sent for information. Printed
from an uninitialed copy.
378-376/428-S/80023
910 Foreign Relations, 19691976, Volume XXI
Spain and Guatemala have reportedly decided to apply the Es-
trada Doctrine and continue relations with Chile.
2
The Junta formally broke relations with Cuba and has ordered
Cuban diplomats to leave the country as soon as possible.
USUN has been informed by the UN Secretariat that a request by
Cuba for a Security Council meeting is no longer expected.
2
The Estrada Doctrine, articulated by Mexican Foreign Minister Genaro Estrada in
1930, held that recognition of a government should be based on its de facto existence
rather than on its legitimacy.
352. Transcript of a Telephone Conversation Between the
Presidents Assistant for National Security Affairs
(Kissinger) and Secretary of State Ad Interim Rush
1
Washington, September 13, 1973, 9:03 a.m.
K: Hello.
R: Good morning, Henry.
K: Ken, a number of things. Im told over here, I dont know how
true it is, that Kubisch went up to the Committee to brief them
yesterday.
2
R: He did, yes.
K: We didnt have any idea of what the hell he was going to say
and it has the tendency of pushing everything into the White House
again which is the favorite pastime of every department in town.
R: Yes, as a matter of fact I didnt even know he was going myself.
He told me what he said when he came back.
K: Well, but we have to know these things when he goes.
R: Right.
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 369,
Telephone Conversations, Chronological File. No classification marking.
2
Kubisch testified before the Subcommittee on Western Hemisphere Affairs,
Senate Foreign Relations Committee. Excerpts of his September 12 testimony are in an
undated paper, Document 141, Foreign Relations, 19691976, vol. E16, Documents on
Chile, 19691973.
378-376/428-S/80023
JanuarySeptember 1973 911
K: Now unless he said that we knew about it 12 to 14 hours ahead
of time, that we expected it Monday, it happened Tuesday
3
and he in-
formed the highest authorities. Now this may or may not be true. If he
did it certainly didnt penetrate to me.
R: He didnt tell me he said that.
K: Thats what Ziegler tells me all the newspapers have.
R: I havent seen the newspapers but what Kubisch told me was
that we knew nothing about it; that we had not been told about it and it
came as a complete surprise to us and that the turnaround of our de-
stroyers and submarines took place after the thing started and when we
found out about it. So theres something wrong here somewhere,
Henry.
K: Right. Well, now at the briefing today I think we can express re-
gret at the personal fate of Allende.
R: Yes, we worked out some language on that. I thought it was to
go out last night saying that we regretted the death of Allendewe re-
gretted the loss of lives including particularly the death of the Head of
State, Allende. And just let it go at that.
K: Yeah, we can say that.
R: Right.
K: And we can also say we do not support revolutions as a means
of settling disputes but thisthat is perfectly consistent with what we
did here.
R: Right.
K: We didnt support it. Now I am also told that people are raising
the issue of Davis coming back here.
R: Whos coming back?
K: That Nat Davis was back here to talk to meour Ambassador.
R: They raised that question and the answer is?
K: I think the answer is that I asked for him three weeks ago when I
was appointed
4
and we left it up to him to pick the time.
R: This is right.
K: When it was least likely to be disturbing to the conduct of his
mission and thats another good proof that we didnt know anything
about it.
R: As a matter of fact thats exactly what I told them to say that the
fact that he came back when all those large numbers of Ambassadors
3
September 11.
4
On August 22, President Nixon announced at a press conference that he would
nominate Kissinger to be Secretary of State to fill the vacancy created by Rogerss resigna-
tion. (Public Papers: Nixon, 1973, pp. 710711)
378-376/428-S/80023
912 Foreign Relations, 19691976, Volume XXI
that you requested three weeks ago and that he picked the time shows
that we knew nothing about it.
5
K: Exactly.
R: Were on the same beam there, Henry.
K: Good. Now.
R: This statement as to what Kubisch said must be wrong because
he came back from that and told me at once what he had said.
K: Right. Of course its an absurd situation where we have to apol-
ogize for the overthrow of a hostile governmentof a government hos-
tile to us.
R: I know it is, but I think so farI havent seen this thing about
what Kubisch said he knew about it ahead of time.
K: Ziegler just mentioned it to me; I havent seen it myself.
R: This would be a statement by some Senator who heard him
what happened was Gale McGee called together about eight Senators,
Javits, Church, all the doves and he brought them together to prevent
their going overboard on accusing us with regard to Chile or making
bad statements. When Kubisch went up, Gale McGee had this group to-
gether. Kubisch, he thinks, convinced them that we had nothing to do
with it at all. He had some very searching questions from the doves,
from Church; Javits was a help and Javits I think was agreeing with
helping Gale McGee. That overall it was a real plus and it just suddenly
came up, Henry, and he went up and told me about it when he came
back.
K: Ok. Well, no, he did the right thing.
R: He did the right thing and he said the right thing. He did no
wrong, he said the right thing.
K: Good. Make sure that they dont shift it into this building be-
cause I didnt know that a coup was coming at any particular date.
Wed been hearing coup rumors for a year.
R: Absolutely, and Kubisch said that we knewnothing about it. We
meaning the White House, the State Department, everything.
K: Right. OK. Many thanks.
R: OK, Henry.
5
Both White House and Department of State spokesmen issued statements on Sep-
tember 13 acknowledging that the United States knew of rumors of the coup but denying
that the United States knew in advance when it would occur. (Bernard Gwertzman, U.S.
Expected Chile Coup but Decided Not to Act, New York Times, September 14, 1973, p. 1)
378-376/428-S/80023
JanuarySeptember 1973 913
353. Minutes of a Meeting of the Washington Special Actions
Group
1
Washington, September 14, 1973, 9:5210:23 a.m.
SUBJECT
Chile
PARTICIPANTS
ChairmanHenry A. Kissinger CIA
William Colby
State
David Phillips
Kenneth Rush
Jack Kubisch Treasury
William Simon
Defense
John Hennessy
V/Adm. Raymond Peet
Robert F. Corrigan NSC
B/Gen. Brent Scowcroft
JCS
Richard Kennedy
Adm. Thomas H. Moorer
William Jorden
V/Adm. John P. Weinel
James Barnum
SUMMARY OF CONCLUSIONS
It was agreed that:
. . . a working group, under the leadership of Mr. Jorden and Mr.
Kubisch, would prepare a comprehensive paper on Chiles economic
and military needs over the short, middle, and long term;
. . . a brief paper would be prepared by Mr. Kubisch on what the
Allende government was like during its rule;
2
. . . Mr. Kubisch would take the lead in coordinating public disclo-
sures of US policies and actions toward the new regime.
Mr. Kissinger: (to Mr. Colby) Could we get a quick rundown on
the situation?
Mr. Colby briefed from the attached text.
3
Mr. Kissinger: (referring to Mr. Colbys briefing) What triggered
this now? What was the urgency for the coup at this time?
Mr. Colby: There was nothing in particular. It has been spreading
for months. There has been a general buildup of dissatisfaction, and I
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H94, WSAG Meeting, Chile, 9/14/73. Secret; Nodis. This
meeting took place in the White House Situation Room.
2
Neither paper was found.
3
Not attached and not found.
378-376/428-S/80023
914 Foreign Relations, 19691976, Volume XXI
think the military felt the country was descending into chaos and de-
cided to act.
Mr. Kissinger: You should have told them about my confirmation
hearing.
4
What has been the response to our overtures toward the new
government, Jack? (referring to Mr. Kubisch).
Mr. Kubisch: We told General Pinochet that we want to keep up
our informal contacts with the new government and also told him of
our general good-will toward his government. He was pleased, and
also wants to cool things for the time being. His government will want
some emergency medical supplies and other things. We have already
established private relations with the new government.
5
Mr. Kissinger: The question is, at what point we change from unof-
ficial to official contacts. Well keep looking at the situation over the
weekend and see how things develop. Unofficial contacts have been es-
tablished already. Bill, (to Mr. Colby) do you have any contacts?
Mr. Colby: No, not at this point. The problem is that the Chilean in-
telligence service was run by the Cubans. The service will need some
fleshing out first.
Mr. Simon: Our intention, as we see it, is that we can use the coup
as a bargaining point to settle the expropriation and debt resettlement
issues.
Mr. Kissinger: No. I dont want to go after that now. The first thing
for us not to do is to give the appearance that we are putting the pres-
sure on them.
Mr. Kubisch: I agree. If we send a team down there to help, this
would get the idea across that we want to help, but we should wait on
specific matters until the dust has settled.
Mr. Kissinger: What we need is some face-saving formula. The
Chileans have got to reschedule their debt, dont they?
Mr. Simon: Debt rescheduling is one thing, compensation for ex-
propriation is another.
Mr. Kissinger: I think that compensation for the expropriation of
ITT (International Telephone and Telegraph) is unlikely.
Mr. Simon: I wasnt referring to ITT specifically. Other companies
have indicated an interest in talking about their claims.
Mr. Rush: I think we have to look at the political implications of
this. We have to be very careful not to give the impression that our help
4
Kissingers confirmation hearings ran from September 7 to September 21. He was
confirmed on September 22 and took office on September 23.
5
See Document 350.
378-376/428-S/80023
JanuarySeptember 1973 915
was designed to overthrow Allende. We have to be careful to point out
that we had nothing to do with the coup, which is true.
Mr. Kissinger: I wish you hadnt said that.
Mr. Hennessy: I think we have to look at it from the standpoint of
our credibility. We have to determine how best we can help.
Mr. Kissinger: I agree.
Mr. Rush: I think the best way to protect our companies in Chile is
to adopt a hands-off policy, let them work it out themselves with the
new government.
Mr. Kissinger: We will need something to meet our legislative
commitments.
Mr. Rush: I think that our best chances for gaining compensation is
to postpone any actions until after the coup has quieted down and this
thing is off the front pages.
Mr. Kissinger: Let me make this proposal, that we agree to no eco-
nomic request until we are farther down the road. Lets get a working
group together to devise an overall strategyshort term, middle term,
and over the longer run. Then when a message is sent in asking for
something we know what we are talking about.
Mr. Kubisch: Good! I talked to Quigley of Anaconda Copper re-
cently. He is happy with the situation and figures they can work with
the new government.
Mr. Kissinger: Lets just let the situation develop and see how the
new government consolidates itself. Can we get that working group to-
gether, perhaps under Bill (Jorden)?
Adm. Moorer: There probably will be some military questions as
well, such as equipment and so forth.
Mr. Kissinger: Tom (to Adm. Moorer) what is your view on the
present situation?
Adm. Moorer: I think we ought to let the new government get its
feet on the ground first. We can deal with the gut issues later. I think
these people can be dealt with. They are a conservative group, and I
think we can talk turkey to them.
Mr. Kissinger: We want to avoid the impression of being over-
eager. Well get a paper on the short, middle, and long term require-
ments. How long will it take to put together?
Mr. Kubisch: We have a basis already, all we have to do is flesh it
out.
6
6
A September 13 memorandum from Shlaudeman to Kubisch notes that FMS pur-
chases already in the pipeline were being sent to Chile. (Ibid., RG 59, Central Files
197073, DEF 198 USCHILE)
378-376/428-S/80023
916 Foreign Relations, 19691976, Volume XXI
Mr. Kissinger: Lets aim for a Wednesday meeting.
7
I think we
have done quite well on our position to the public; have left a positive
impression. But, I am bothered by the statement of the Defense
spokesman to the press that we had rumors of the coup in advance and
that our ships in Peru had been warned ahead of time not to go into
Chilean waters. I think that we should have better coordination on our
answers to the press. It is the truth that we had nothing to do with the
coup, isnt it?
Mr. Rush: That is the truth, we had nothing to do with it.
Mr. Kissinger: Can we all please say the same thing next time. I
[learned to] read where the Chilean Navy used the presence of our
navy to start the coup.
8
Is this true?
Adm. Moorer: No. Our ships were nowhere near Valparaiso.
Mr. Kubisch: As I recall, the ships were going to leave Monday
night. They turned around, and the coup was launched. The Chilean
Navy may have used this as an excuse.
Adm. Moorer: It was coincidental. The ships were already on their
way.
Mr. Kissinger: Is it true that our fleet was going to be there on
Tuesday morning?
Mr. Kubisch: They were to, but they turned around. It was part of
the UNITAS exercise.
Adm. Moorer: Its ridiculous to connect the two, the UNITAS exer-
cise was scheduled with the Chileans for months, and it has been a year
in the making.
Mr. Kissinger: Could somebody explain that the next time some-
thing like this happens.
Adm. Moorer: Its ridiculous to cancel UNITAS in advance on the
theory there might be a coup.
Mr. Kissinger: I know, but the story could have been developed
that the Navy used the exercise as a cover to start the coup.
Adm. Peet: The ships were scheduled to leave the 10th (of Sep-
tember). The coup was on the 11th.
Mr. Kissinger: I suppose the opposite could be true too. Suppose
the coup was supposed to come off, but didnt. Its like the Davis thing
(referring to Amb. Davis). I asked him to come in on consultation and
for him to pick a quiet period. He judged that this was the time, and
that was ordered a couple of weeks ago.
7
September 19. The next WSAG meeting was held on September 20. See Document
361.
8
Brackets in the original.
378-376/428-S/80023
JanuarySeptember 1973 917
Adm. Peet: Even the key people in the Chilean Government did
not receive warnings.
Mr. Kissinger: Weve had them for months.
Mr. Colby: There was either an intelligence gap or a communica-
tions failure.
Mr. Kissinger: Why didnt we tell Chile that a coup was coming?
Mr. Kubisch: Some warning of a coup was given in confidence.
They (the Allende government) knew what we kneweven more.
Mr. Kissinger: When I get up on the Hill Monday,
9
and they ask me
about this, what am I going to say, that there werent any specific
warnings coming through?
Mr. Colby: We had a precise indication the night before the coup.
You can say that we had a series of warnings, but didnt know until
Monday that they were going ahead.
Mr. Kubisch: The leaders of the coup were very cagey, they re-
frained from tipping us off. The leadership did not tell us when it
would happen.
Adm. Moorer: You can say we had indications but no warning.
Mr. Kissinger: What is happening at the UN? On what basis are the
Cubans asking for a Security Council meeting?
Mr. Colby: The attack on the Cuban ship, attacks on the Cuban Em-
bassy in Santiago.
Mr. Kissinger: What is our position? Are the Cubans actively pur-
suing their case?
Mr. Kubisch: We would like to see the Security Council deferred
until Chile gets a good spokesman there to explain what happened. We
think Chile could present a better case with a good spokesman.
Adm. Moorer: This is off the subject, but two C130s carrying am-
munition for UNITAS were dispatched on a routine basis.
Mr. Kissinger: Yes, that was routine, we said that the other day.
What is the reaction to the coup of the other Latins, Jack? (to Mr.
Kubisch)
Mr. Kubisch: Mexico and Peron (of Argentina) have condemned
the coup.
Mr. Kissinger: I understand that Echeverria was quite taken with
Allende. He was perhaps closer to Allende than anyone else.
Mr. Kubisch: Peron says the US was not involved, but he privately
believes we had something to do with it. The general reaction
throughout Latin America is that, in time, this could be a very good
9
September 17. Kissinger is referring to his confirmation hearings.
378-376/428-S/80023
918 Foreign Relations, 19691976, Volume XXI
thing. From our standpoint, it is excellent. On the Venezuelan initiative,
for example, (on Cuban re-admittance to the OAS) Venezuela needed
one more vote. Now they need two.
Mr. Kissinger: I need somebody to give me a brief paper on what
the Allende government was like. Bill (Mr. Jorden) and Jack (Mr. Ku-
bisch) maybe you could get together on that. I have the impression that
it was rather anti-US wasnt it?
Mr. Kubisch: On a multilateral basis, yes. Bilaterally, less so.
Adm. Moorer: I might add thaton Peronthat we have a report
from a high-level contact in Perons cabinet that Peron said he was glad
the coup took place. He thinks he can now deal better with his own
opposition.
Mr. Kissinger: Do we know for sure that Allende committed sui-
cide, or was he killed?
Mr. Colby: Its still kinda either/or. I wished he would have asked
our permission.
Adm. Moorer: He was shot in the mouth, wasnt he?
Mr. Kubisch: Yes, and he was right-handed.
Mr. Colby: We know he had about ten drinks in the morning and
was loaded by noon. He has quite a history of being a boozer, under
stress.
Mr. Hennessy: In this paper, can we make the point about minimal
support to the other government with projected trends and not abso-
lute programs?
Mr. Kissinger: Yes. Lets get the paper by the end of the day. I have
the impression that Chile is in bad shape.
Mr. Simon: Its an economic disaster.
Mr. Kissinger: Jack (to Mr. Kubisch). I want you to take the leader-
ship on these public disclosures. I want a coordinated position on these
matters. On the paper, well get the short, middle, and long term pro-
jections on economic aid, humanitarian aid, military programs, debt
re-scheduling. Lets have another meeting Wednesday, the paper by
Tuesday. Bill, will you take the lead?
378-376/428-S/80023
JanuarySeptember 1973 919
354. Memorandum From the Deputy Director for Coordination,
Bureau of Intelligence and Research (McAfee) to the Director
of Operations Policy, Bureau of Intelligence and Research
(Gardner)
1
Washington, September 14, 1973.
SUBJECT
ARACIA Meeting, 14 September 1973, 11:00
PARTICIPANTS
ARAMessrs. Kubisch, Shlaudeman and Amb. Bowdler; CIAMessrs. [name
not declassified] and Phillips; INRWilliam McAfee
The weekly ARADDCDDO meeting was held this morning.
Though neither side had formal agenda items to table the meeting was
not without interest, since the subject was Chile.
Chile
Jack Kubisch was preparing guidelines for Dr. Kissinger on the
question of how much advance notice we had on the coup.
2
He and
Dave and Jim agreed that the press play to the effect that we had clear
advance notice was a misrepresentation. Jack indicated the guidelines
would say that many reports of an impending coup had recently been
received, that all here were aware of the possibility but that it was not
accurate to say that the Government had received a clear indication
that a coup was about to be triggered. Jack noted that shortly after the
coup a Chilean leader told the Embassy that they had specifically de-
cided to withhold information on the coup timing. Jack said he doubted
if Dr. Kissinger would use this information, for it would reveal our
close contact with coup leaders.
Dave noted reports that the new junta was considering breaking
relations with the Soviets and asked for guidance in case any of their
assets were questioned. Harry said we were not now in a position to
give guidance without checking up the line in the Government, and
suggested that if queried the Agency should simply hold off the ques-
tioner. Dave noted subsequently that their assets in various parts of the
world would soon be questioned as to the US attitude toward the coup
and asked that guidance be provided.
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical, Chile 19731975. Secret.
2
The September 14 memorandum from Pickering to Scowcroft is Document 148,
Foreign Relations, 19691976, vol. E16, Documents on Chile, 19691973.
378-376/428-S/80023
920 Foreign Relations, 19691976, Volume XXI
There was some discussion of the extent to which the Cubans had
handled intelligence for the regime and how many Cubans were
working with the government. Harry asked for information on what
the attitude of Communists was and Dave said their people had been
pretty well pinned down and were not in a good position to collect but
would collect when able to.
355. Memorandum From the Presidents Assistant for National
Security Affairs (Kissinger) to President Nixon
1
Washington, September 14, 1973.
SUBJECT
Talk with Chilean Junta Leader
General Pinochet, President of the Chilean Junta, has had a secret
meeting with the Chief of the U.S. Military Advisory Group, Colonel
Urrutia, whom he used as an intermediary to send a message to the
U.S. Ambassador.
2
He conveyed the following:
1) The new Chilean Government intends to break relations with
Cuba, the USSR, North Vietnam and North Korea. They also intend
to clean out pro-Marxist militants from Chilean diplomatic missions
abroad.
2) The Juntas fundamental desire is to strengthen traditional ties
of friendship with the U.S. They hope we can see our way clear to give
them relief for one year on Chiles debt to the U.S.
3
They think they will
need a year to straighten things out.
3) They intend to honor Chiles copper debt obligation and look
forward to working out some mutually acceptable solution.
4) They hope we will be able to help supply them with foodwith
wheat as a first need but including other food products.
5) They continue to be interested in buying U.S. military equip-
ment, including M60 tanks. (He noted in this connection that Allende
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII. Confidential. Sent for information. A
stamped notation on the memorandum indicates that the President saw it.
2
See Document 350.
3
Nixon underlined this sentence and next to this paragraph he wrote, K[iss-
inger]OK.
378-376/428-S/80023
JanuarySeptember 1973 921
had been pushing the Army very hard in recent days to buy Soviet
equipment but that the Army opposed such procurement.)
4
He noted that he and his colleagues had not even hinted to us be-
forehand of their planned action and said he thought it had been better
that way.
At the end of the conversation, General Pinochet called in several
of his military colleagues. Col. Urrutias impression was that they are
pleased at the way things are going. They see their immediate problem
as one of eliminating isolated pockets of resistance and snipers. As a
parting note, the General said the new government intends to declare
illegal the two major parties of the Marxist coalition (the Socialists and
the Communists) as well as sympathetic minor parties.
Pinochet understands and is relaxed about the matter of recogni-
tion. He volunteered that obviously the U.S. should not be the first to
announce its intention to continue relations with the new Chilean Gov-
ernment. He also recognized the advisability of avoiding too much
public identification with us for the moment.
5
Ways in which we can respond to the Chilean questions and their
needs will be the subject of Fridays WSAG meeting.
6
4
Next to this paragraph, the President wrote, K[issinger]OK.
5
Nixon underlined this sentence and wrote in the margin, good.
6
See footnote 7, Document 353.
378-376/428-S/80023
922 Foreign Relations, 19691976, Volume XXI
356. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, September 16, 1973.
SUBJECT
U.S. Covert Action Programs in Chile
The attached memo from Bill Colby
2
outlines the covert action pro-
grams carried out in Chile since 1970. Two items of major significance
stand out:
(1) We did not directly support either of the democratic candidates
who opposed Allende in the 1970 elections;
(2) We never supported any program aimed at his overthrow.
The entire thrust of our activities was to keep non-communist po-
litical forces [less than 1 line not declassified] alive and healthy enough to
pose some opposition to the United Party coalition (Communists and
Socialists). Funds also went to keeping media voices of opposition
(press and radio primarily) alive. [less than 1 line not declassified]
You will, of course, want to be very careful about handling any
questions designed to bring into the open any covert action programs
conducted or supported by us. To get into this, even in executive ses-
sion, will open a Pandoras box. Once a precedent of discussing CIA ac-
tivities before the Foreign Relations Committee is established, no pro-
grams in other countries will be immune. And with so many Senators
and staff present, the likelihood of leakage is almost certain.
We have good reason to believe, of course, that there was a delib-
erate campaign by Allendes followers to squeeze out the opposition,
especially the media. Supplies of newsprint were rationed and prices
were raised. Advertisers were pressured to give their business to pro-
Government newspapers and radio stations. Advertising income for
the opposition media fell significantly. But all of this is difficult to
prove convincingly. I have no doubt that publishers and radio owners
will be making a convincing case in public in the future on this matter.
But the available facts at this moment make the case tenuous in terms of
legal evidence.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 73. Secret; Sensitive; Eyes Only. Sent for
information.
2
Attached is a September 16 memorandum from Colby to Kissinger. The memo-
randum is Document 145, Foreign Relations, 19691976, vol. E16, Documents on Chile,
19691973.
378-376/428-S/80023
JanuarySeptember 1973 923
For these reasons, I believe any questions about undercover activ-
ities by the U.S. in Chile should be handled something like this:
Gentlemen, as you know, I have tried to be as forthcoming and
frank in these hearings as I can be. And that will be the pattern for the
future. However, the question that has just been asked raises delicate
matters involving intelligence operations that I think it is better not to
get into in this forum. I will be happy to discuss the matter with the
Committee established by the Senate to deal with these questions. And
I know some members of that group are included in this Committee.
I do want to give you this assurance: first, we did nothing to op-
pose the election of Mr. Allende in 1970 or to support his opponents in
that election; second, we neverin any shape or formsupported any
move at any time to overthrow the legal government of Chile. We did
not encourage or back any coups.
357. Transcript of a Telephone Conversation Between the
Presidents Assistant for National Security Affairs
(Kissinger) and President Nixon
1
September 16, 1973, 11:50 a.m.
K: Hello.
P: Hi, Henry.
K: Mr. President.
P: Where are you. In New York?
K: No, I am in Washington. I am working. I may go to the football
game this afternoon if I get through.
P: Good. Good. Well it is the opener. It is better than television.
Nothing new of any importance or is there?
K: Nothing of very great consequence. The Chilean thing is getting
consolidated and of course the newspapers are bleeding because a
pro-Communist government has been overthrown.
P: Isnt that something. Isnt that something.
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 380,
Telephone Conversations, Chronological File. No classification marking. All blank
underscores are omissions in the original. The President was in Aspen, Colorado, and
Kissinger was in Washington at his home.
378-376/428-S/80023
924 Foreign Relations, 19691976, Volume XXI
K: I mean instead of celebratingin the Eisenhower period we
would be heros.
P: Well we didntas you knowour hand doesnt show on this
one though.
K: We didnt do it. I mean we helped them. created the con-
ditions as great as possible(? ?)
P: That is right. And that is the way it is going to be played. But
listen, as far as people are concerned let me say they arent going to buy
this crap from the Liberals on this one.
K: Absolutely not.
P: They know it is a pro-Communist government and that is the
way it is.
K: Exactly. And pro-Castro.
P: Well the main thing was. Lets forget the pro-Communist. It was
an anti-American government all the way.
K: Oh, wildly.
P: And your expropriating. I notice the memorandum you sent up
of the confidential conversation
2
set up a policy for reimburse-
ment on expropriations and cooperation with the United States for
breaking relations with Castro. Well what the hell that is a great treat(?)
if they think that. No dont let the columns and the bleeding on that.
K: Oh, oh it doesnt bother me. I am just reporting it to you.
P: Yes, you are reporting it because it is just typical of the crap we
are up against.
K: And the unbelievable filthy hypocrisy.
P: We know that.
K: Of these people. When it is South Africa, if we dont overthrow
them there they are raising hell.
P: Yes, that is right.
[Omitted here is discussion unrelated to Chile]
2
Document 355.
378-376/428-S/80023
JanuarySeptember 1973 925
358. Memorandum From William J. Jorden of the National
Security Council Staff to the Presidents Assistant for
National Security Affairs (Kissinger)
1
Washington, September 17, 1973.
SUBJECT
Cable to Santiago
The attached draft cable to Santiago has been sent by State for NSC
clearance. It covers two subjects: recognition and a Chilean request for
military equipment (helmets and flares).
2
On recognition, it instructs our Ambassador to tell the Junta that we
will be responding affirmatively to their note re continuing relations
in the next few days.
3
It notes that domestic and international consid-
erations make this very brief delay highly advisable in the overall in-
terests of the new GOC as well as in our own.
On the military request (for 2,000 flares for nighttime Air Force op-
erations and for 1,000 steel helmets and liners), it states that we should
avoid any possible public identification with military operations in
Chile at this moment while some fighting is going on. It argues it would
be better for both Chile and us if the Chileans could get this equipment
from Brazil or Argentina. If it is not available from those sources, we
will reconsider the request on an urgent basis. Moreover, State
doubts that the supplies mentioned are essential to Chilean military
success.
Our Embassy in Santiago judges that the flares are important to the
Chilean Air Forces success in nighttime operations in the days ahead.
Ambassador Davis also notes that the new regime is operating under
great strain and is counting friends in this moment. He believes a
negative reaction from us could have serious repercussions and set a
pattern of attitudes that we should be willing to take some risks to
avoid.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile 73. Secret. Sent for urgent action. A handwritten no-
tation on the first page reads, OBE. Another handwritten note at the end of the memo-
randum reads, Kennedy concurs. Sent under a September 17 covering memorandum
to Scowcroft, in which Jorden stated, Because of the implications [this] might have on
the Hill and for Henrys confirmation, I believe you will want to draw this to his personal
attention and get his reaction. (Ibid.)
2
Attached but not printed. Sent as telegram 185004 to Santiago, September 18.
(Ibid., RG 59, Central Foreign Policy File, P7500140669)
3
Davis informed the Department that he had received the note in telegram 4356
from Santiago, September 17. (Ibid., P7500112107)
378-376/428-S/80023
926 Foreign Relations, 19691976, Volume XXI
Part of States thinking on the possible effects of sending military
supplies and having the fact exposed publicly is that it might influence
thinking on the Hill, produce outraged speeches and possibly influence
Senate action on your confirmation. I would think the effect would be
minimal, but you are the best judge. In part, the decision may rest on
what you were asked this morning and what you told the Committee.
Would our decision to go ahead and send modest supplies be some-
thing that should be discussed with Congressional sources first? If you
indicated our intention was to move very slowly in Chile, then we
probably should not act immediately. But if not, I see no real problems
with moving ahead.
It is important to set a pattern of cooperation and trust with the
new leaders in Chile. Unless other interests would be damaged (as
above), I suggest we go back to Santiago with an offer to meet modest
military requestassuming we will take the steps necessary to mini-
mize early publicity.
4
On the recognition question, the suggested ap-
proach seems about rightbut I would urge that we not wait more
than a few days.
Recommendation
5
Approve approach on recognition, but lets provide the requested
supplies
Approve Cable as drafted
4
Although the State Department approved the sale, it asked that the Chileans try to
obtain the flares from another country if possible. (Telegrams 187007 and 29210 to San-
tiago, September 17 and 20; ibid., Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile, Vol. VIII) Ultimately, the Chilean Government
bought them from the United States. (Telegram 4474 from Santiago, September 21 and
telegram 189358 to Santiago, September 22; both ibid.)
5
There is no indication of approval or disapproval of either recommendation.
378-376/428-S/80023
JanuarySeptember 1973 927
359. Transcript of a Telephone Conversation Between Mexican
Foreign Minister Rabasa and the Presidents Assistant for
National Security Affairs (Kissinger)
1
September 18, 1973, 1:47 p.m.
K: Emilio. How are you?
R: I just got the very good news that all things are OK, no?
K: The Senate still has to vote, but thats pretty much of a formality,
if the committee votes. The Senate never overturns a committee.
R: Well, Im over-joyed, Henry, and I know and hope that youll be
a great Secretary of State.
K: But I know you, Emilio. Youre going to pull rank on me now as
the senior Foreign Minister.
R: [laughs] No, Henry, Im leaving for United Nations the 28th,
more or less. When in New York Ill call you.
K: Good. I want to see you. You know, if you can put your charter
into neutral language.
2
R: My what?
K: That charterinto neutral language.
R: Yes, and we have thought about thisnot as a treaty, but as a
declaration.
K: Thats what I mean, as a declaration.
R: Exactly. Thats our thought.
K: But if you can do it without being critical of the developed
nations.
R: That I will do.
K: Then I think we will make a big effort to support it.
R: That I will do, Henry. And Ill sit down with you and Ill go over
it.
K: And also I want to discuss with you getting Latin American
policy more active.
R: Fine, because I will just see, well, I have a lot to speak to you. I
was just going over the countries one by one, and I will speak to you
1
Source: Library of Congress, Manuscript Division, Kissinger Papers, Box 369,
Telephone Conversations, Chronological File. No classification marking. Rabasa was in
Mexico City and Kissinger was in Washington. All brackets, except those that indicate the
omission of material, are in the original.
2
Reference is to the Charter of Economic Rights and Duties of States first proposed
by Mexican President Echeverr a at the third session of UNCTAD in AprilMay 1972.
378-376/428-S/80023
928 Foreign Relations, 19691976, Volume XXI
and you see that democracy is now a very curious item in Latin
America.
K: Yes, well, well have to talk about it, Emilio, and I need your
help in this respect.
R: Please, Henry, the place that took certain steps, now lay very
low, Henry, because they are saying that, well, you know, you helped
things that happened.
K: I personally?
R: Oh, no, no, no, the government.
K: No, that isnt true. Believe me, it isnt.
R: Henry, youre telling meI know it. But, play it very cool at this
moment.
K: Well, we are playing it very cool.
R: Because now theyre saying that money is going to overflow
over there.
K: Oh, no, were going to go slowly.
R: And that the biggest national is going to go back again.
K: Who?
R: ITT.
K: No, no, no.
R: Well, they are trying to but I want you to start with the right cer-
tainty a great Secretary of State, especially concerning Latin America.
K: Well, that is my intention, Emilio, and with your help, we can
do it.
R: But at this moment, please, if you can mostly [let no] support
these people because the image of these guerillas all over Latin
America is terrible, Henry. Any association of you, or the government,
or the President would be terrible at this moment.
K: No, no, we are moving very deliberately.
R: Please do so until I speak to you and I can explain many things
that Ive heard and know.
K: Good.
[Omitted here is discussion unrelated to Chile.]
378-376/428-S/80023
JanuarySeptember 1973 929
360. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 18, 1973, 2120Z.
4372. Subject: Relations With New Chilean Government. Ref: State
185004; Santiago 4356, 4304.
2
1. I met Foreign Minister Huerta privately and informally in a pri-
vate home this afternoon. Huerta told me he had received instructions
from Admiral Merino to ask me if it would be possible for USG to con-
firm establishment of ongoing diplomatic relations as soon as pos-
sibleand hopefully during course of the day today. Admiral Huerta
said he had received his instructions from Admiral Merino by tele-
phone from Valparaiso, and Admiral Merino had not been in a position
to give him reasons. Admiral Huerta asked me if I had received his
message to this effect last night, and I affirmed that I had, and had
passed it on to Washington. I went on to explain, however, that there
were domestic and international considerations which made a very
brief delay highly desirable in the interests of both our countries. I told
Huerta that we shall respond affirmatively to the Juntas note, and ex-
pect to do so within the next few days. I also advised him of our stron-
gest desire to cooperate closely and establish a firm basis for a cordial
and most constructive relationship. After some back and forth, Ad-
miral Huerta, who said he was going down to Valparaiso this evening
in any case, said he would explain the situation to Admiral Merino,
find out Admiral Merinos reasons for having made his urgent request,
and get back to me tomorrow.
2. Huerta advised me that the Papal Nuncio has just informed
GOC it is recognizing, and will send a note today. Huerta also men-
tioned with some pleasure that France had formally responded to the
Juntas note. He mentioned the following countries as recognizing
(above and beyond the ones mentioned in Santiago 4304): Nicaragua,
Austria, Uganda, and the Republic of Korea. Huerta also mentioned
that Peru had made some sort of declaration in Lima indicating a con-
tinuance of relations. He had no knowledge that Yugoslavia had re-
portedly announced anything in Belgrade.
Davis
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Chile Vol. VIII. Secret; Immediate; Exdis.
2
For telegrams 185004 and 4356, see footnotes 2 and 3, Document 358. Telegram
4304, September 16, listed the countries that had already recognized the new government
and requested guidance on U.S. recognition. (National Archives, RG 59, Central Foreign
Policy File, [no film number])
378-376/428-S/80023
930 Foreign Relations, 19691976, Volume XXI
361. Minutes of a Meeting of the Washington Special Actions
Group
1
Washington, September 20, 1973, 3:053:49 p.m.
SUBJECT
Chile
PARTICIPANTS
ChairmanHenry A. Kissinger Treasury
William Simon
State
Michael Bradfield
William Porter
Jack Kubisch OMB
Dolph Bridgewater
Defense
William Clements NSC
Robert Hill B/Gen. Brent Scowcroft
V/Adm. Ray Peet Richard Kennedy
William Jorden
JCS
Charles Cooper
Adm. John P. Weinel
James Barnum
CIA
William Nelson
David Phillips
SUMMARY OF CONCLUSIONS
It was agreed that:
. . . recognition of the new government would be announced on
Monday, 24 September 1973;
. . . Ambassador Davis is to talk to the junta on Friday, September
21, to inform them of our goodwill, our intention to recognize in the
next few days, and about the delivery of medical supplies;
. . . a cable will be sent to Ambassador Davis telling him: of our in-
tention to recognize and when; when the emergency food supplies will
be delivered; and authorizing the Ambassador to discuss, with the
junta, Chiles middle-and long-term economic needs;
. . . an economic team would not be sent to Chile until the junta re-
quests one;
. . . the Chile Working Group will continue in operation.
Mr. Kissinger: Lets talk about Chile first and then Cambodia.
Would you like to give us a briefing? (to Mr. Nelson)
1
Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institu-
tional Files (H-Files), Box H94, WSAG Meeting, Chile, 9/20/73. Secret; Nodis. A copy
was sent to Kennedy, Jorden, and Cooper. The meeting took place in the White House
Situation Room.
378-376/428-S/80023
JanuarySeptember 1973 931
Mr. Nelson briefed from the attached text.
2
Mr. Kissinger: Bill (Mr. Porter) or Jack (Mr. Kubisch), any comments?
Mr. Porter: I think the first thing we ought to talk about is the
matter of recognition. Twenty countries have already recognized, but
the crucial thing is the timing in connection with your confirmation.
The new government is an established fact, so its okay to go ahead
with recognition, but the timing . . .
Mr. Clements: I think you ought to wait until after confirmation.
Mr. Kissinger: Why?
Mr. Clements: The Chileans know of the vote coming up. They are
in no particular hurry.
Mr. Kissinger: Has the new government been told by (Ambas-
sador) Davis of our intentions to recognize and of our good-will toward
them?
Mr. Kubisch: Yes, they understand we want to wait. In my
opinion, we should wait until after the vote. The choice is either Friday,
Saturday, or Monday.
3
Mr. Kissinger: Saturday would be all right, if the committee votes
tomorrow.
Mr. Porter: Monday is no problem either.
Mr. Kissinger: Monday is the first day of the UN.
Mr. Clements: Would anything be gained by this being one of your
first acts?
Mr. Kissinger: Theres no way to avoid this being one of my first
acts. If the choice is Monday, there will be plenty of activity between
now and then.
Mr. Kubisch: When do you expect to take the oath?
Mr. Kissinger: Saturday.
Mr. Kubisch: I can see some advantage in Monday.
Mr. Kissinger: Im relaxed about the whole thing. I dont see what
would be gained by waiting until Tuesday.
Mr. Kubisch: Perhaps after the Senate votestomorrow afternoon.
Mr. Kissinger: What is the normal way these things are done. Is
there some set procedure?
Mr. Kubisch: Right now would be a good time. They have satisfied
the requirements.
Mr. Kissinger: I guess we should do it either Saturday or Monday.
Im under no pressure on this thing, I really dont give a damn . . .
2
Not attached and not found.
3
September 21, 22, or 24.
378-376/428-S/80023
932 Foreign Relations, 19691976, Volume XXI
Mr. Clements: Unless there is some issue that needs to be settled
first, I think we ought to bite the bullet on this thing. I see no argument
for not recognizing tomorrow.
Mr. Kubisch: We could couch it in low-key language, that weve
decided to recognize the new government, and let it go at that. That
way well keep the heat off.
Mr. Kissinger: Ill take the heat, if there is any.
Mr. Simon: Speaking of heat, what is the press doing to us down
there. They are complaining about inadequate responses from the new
government. Did you speak to them Jack?
Mr. Kubisch: I did, and think it went very well. There are about 75
to 90 journalists in Chile now, and well be starting to get their stuff in
droves.
Mr. Kissinger: Senator Church the other day dropped me a note
raising the question of asylum. Whats the problem?
Mr. Kubisch: That doesnt pertain to us. There are few Americans
caught up in it. Most are third-country nationals who have fled their
own countries and got caught up in this thing. The governments
holding about 5,000 in the stadium. They have been very candid about
this. They intend to treat them in accordance with military courts. If in-
nocent, they will be free to return to Cuba. If guilty, the junta intends to
deal with them harshly. The question that Senator Church is really ad-
dressing is human rights. The UN Human Rights Commission has al-
ready looked into this and given Chile a clean bill of health.
Mr. Porter: We ought to encourage them (the refugees) to go to
Mexico or France, it would offer a way out.
Mr. Kubisch: You may be questioned closely on this up there.
(New York)
Mr. Kissinger: Church also mentioned some OAS Committee. Is
there such a thing?
Mr. Kubisch: Probably the OAS Human Rights Commission.
Mr. Porter: The juntas doing the right thingtheyre letting the
press in and are taking the right stance on the refugee question.
Mr. Kissinger: That demonstrates the total naivete of the new gov-
ernment. If they think the press has any interest in the truth, theyre
mistaken. All they will want to do is horror studies.
Mr. Porter: Yes, but the press is not being kept out.
Mr. Kissinger: Do you (to Mr. Kubisch) think (Ambassador) Davis
fully understands our position?
Mr. Kubisch: I think he is almost with us. I think a good, strong
message of support for him would help. He is kinda nervous, particu-
378-376/428-S/80023
JanuarySeptember 1973 933
larly since it took us forty-eight hours to give him an answer to that
cable.
Mr. Kissinger: Lets give him a message expressing our good-will.
Tell him, informally, that were going to recognize.
Mr. Kubisch: Hell appreciate that.
Mr. Kissinger: Brazils reaction to the flares and helmets. How do
you explain that?
Mr. Kubisch: Brazil has this geopolitical concept of the world.
Anything north of the islands and Central America is ours, anything
south of that they dont want us to meddle in. My interpretation is that
they were trying to send us a signalreally didnt want to do it.
Mr. Kissinger: I suppose you talked to them about economic
assistance.
Mr. Kubisch: Yes.
Mr. Porter: They are in need of about a million dollars worth of
medical supplies. They have about 100,000 dollars worth on hand. Its a
simple delivery, the (Chilean) air force has taken over an airport for the
delivery. There will be no fanfare, no problem.
Mr. Clements: I see no problems.
Mr. Kissinger: Should we authorize the needed supplies now?
Mr. Kubisch: Now or Monday.
Adm. Peet: Theres no problem in the arrival schedule, its all set
up.
Mr. Kissinger: Any problem with medicines and food?
Adm. Peet: No.
Mr. Kubisch: The question is, do we use (US) air force planes or
commercial planes, and the timing?
(Dr. Kissinger was called out of the meeting at this point.)
Mr. Kissinger: Let me sum up. Well send a cable outDefense
and usthat sets forth clearly our generally favorable attitude toward
the new government, on recognition. Our views on medical supplies.
How about food? How are they on that?
Mr. Porter: We figure they will need about 18,000 tons. It looks to
us like the CCC credits are the only way.
Mr. Simon: Whether its financed through the Ex-Im Bank is the
question.
Mr. Cooper: Are you talking about the 200,000 to 250,000 tons that
will be needed over the longer term? The question is how to finance the
CCC credits. Agriculture sees no problem and has already agreed to go
ahead and unblock on the CCC credits.
Mr. Simon: No, Im talking about the longer term.
378-376/428-S/80023
934 Foreign Relations, 19691976, Volume XXI
Mr. Cooper: Well, were talking about the emergency food needs.
Mr. Kissinger: Are we sending in emergency food needs. Can we
justify this as an emergency?
Mr. Kubisch: Yes, but the delivery is a matter of timing.
Mr. Kissinger: You suggest after recognition?
Mr. Kubisch: Yes. Shipment can be by air, via Argentina.
Mr. Kissinger: If conditions permit. This asylum issue is like
pulling teeth. Youre going to hear a lot of screaming. Has Davis been
instructed to support us on this?
Mr. Kubisch: Yes, but Im not clear on the timing. Do you want to
do it after recognition.
Mr. Kissinger: Well wait until Monday.
Mr. Porter: We have to have a decision on this food business. I
think we should go the CCC route.
Mr. Kubisch: We have to. The Ex-Im route creates problems. How
much is the question, the first 18,000 tons, or all of it?
Mr. Kissinger: As I understand it, the first phase is geared toward
emergency needs, no?
Mr. Kubisch: Its our understanding that the 18,000 tons . . .
Mr. Kissinger: Whats the easiest to justify?
Mr. Simon: CCC credits are relatively high-cost. Theyre three-year
credits with high interest.
Mr. Cooper: But AID funds are hard to get, and there is no
mechanism.
Mr. Kissinger: What are the ExIm terms?
Mr. Simon: Six percent, and they are longer term.
Mr. Clements: But we can get around to that later, no?
Mr. Simon: Yes.
Mr. Kissinger: Do you agree (to Mr. Kubisch)?
Mr. Kubisch: I go along with the CCC credits, leaving the ExIm
credits until later. We can tell what the cost will be then.
Mr. Simon: Fifteen million dollars is a pretty small figure with all
their other problems.
Mr. Kubisch: Then well authorize (Ambassador) Davis to discuss
their needs with them and then cable their proposals to Washington.
Its the quickest way well find out what they really want.
Mr. Kissinger: Yes, he can do that tomorrow.
Mr. Simon: Are you aware that two Russian ships with wheat are
headed there?
Mr. Kubisch: I was aware that they are to leave Hawaii, but I am
not aware they are carrying wheat.
378-376/428-S/80023
JanuarySeptember 1973 935
Mr. Kissinger: What is this issue on the flares all about?
Mr. Kubisch: The Chileans wanted one thousand flares to use
mainly at night, mostly as a scare tactic. They figure they can use these
to break up demonstrations and the like. Theyre for intimidation.
Mr. Kissinger: I wasnt aware that helmets were more useful at
night than during the day.
Mr. Kubisch: The helmets were secondary. The flares were impor-
tant; they were going to use the helmets for draftees.
Mr. Kissinger: The next thing youll be telling me is that you want
to transfer nuclear weapons.
Mr. Kubisch: We got in a message last night. They wanted to buy
them commercially rather than on a government-to-government, and
wanted them by next week. We suggested they approach third
countries.
Mr. Kissinger: I know its sort of run-of-the-mill stuff, but I cant
believe a thousand helmets or whatever will make that much
difference.
Mr. Kubisch: We can await their preference on that.
Mr. Porter: We can encourage them to look elsewhere.
Mr. Kissinger: Should Davis suggest that they sign the letter of in-
tent after recognition?
Mr. Kubisch: I dont know about that. I remember we agreed to
send a team to Nairobi to discuss a similar case, and it worked out quite
well. I think it would be desirable for (Amb.) Davis to mention it in his
next talks with the new government and see what they think?
Mr. Kissinger: Put together a comprehensive message, and well
clear it tonight. Are they on the same time as we?
Mr. Kubisch: Yes, now that its Daylight Savings Time.
Mr. Kissinger: Well wait on the middle and longer term programs
until Davis has had a chance to talk with them and find out what they
want.
Mr. Simon: But, what is middle and long term? They are difficult to
separate.
Mr. Kubisch: To me, its a question of now or next week.
Mr. Simon: I think we have an interest in pursuing the debt re-
scheduling now.
Mr. Kissinger: Lets tell them that well discuss rescheduling later.
Mr. Simon: I would put it on this basis, that were not going to cut
them off, that were handling the debt issue. That way, funds can start
flowing again. We inform them without the pressure.
Mr. Kubisch: I would prefer to concentrate on the two-to-four
week emergency phase.
378-376/428-S/80023
936 Foreign Relations, 19691976, Volume XXI
Mr. Kissinger: The problem is the great insecurity of the new gov-
ernment. If we can do this now it might help.
Mr. Simon: Its important to start thinking of the longer term.
Mr. Kubisch: Do you want to send a team down to discuss the
problem?
Mr. Kissinger: I think its premature. Once they tell us they want to
talk, then okay. Well talk when they are. I should think that would be
sooner than four to six weeks.
Mr. Cooper: The team should be able to talk about lines of credit,
stabilization loans . . .
Mr. Nelson: They will be very receptive to this type of approach.
Mr. Simon: Weve got to make it clear that we are prepared to go
all the way and that we support their government.
Mr. Cooper: It should be a small team, not more than two people
who know what theyre talking about.
Mr. Kissinger: No ITT officials.
Mr. Kubisch: Did you hear the rumor that Dita Beard is being con-
sidered as the new ambassador?
4
Mr. Kissinger: Okay, well get a cable out telling them about the
timing of recognition, the emergency food supplies, CCC credit, emer-
gency food suppliesthe level and the delivery, what do they recom-
mend over the longer terms, and that a team will be sent when the
Chileans are ready.
Mr. Kubisch: Do you want to include the investment disputes in
the message?
Mr. Kissinger: Thats premature. These are the first things. We
dont want to make the mistake of appearing to press them.
Mr. Clements: Yes, that would be almost like a consideration.
Mr. Kubisch: How about military assistance?
Mr. Kissinger: Its much too early.
Mr. Porter: Is there need for some pressure?
Mr. Kissinger: Thats an on-going problem, tell them well discuss
it in due time.
Mr. Cooper: You could say something about us discussing it. That
should head-off any questions.
Mr. Kubisch: Do you want the working group to continue?
Mr. Kissinger: Absolutely!
Mr. Kubisch: You want it to operate out of the White House?
4
Dita Beard was an ITT lobbyist.
378-376/428-S/80023
JanuarySeptember 1973 937
Mr. Kissinger: Thats the usual way.
Mr. Kubisch: Ill take the responsibility for getting everybody
together.
Mr. Clements: Are we agreed on the previous items?
Mr. Kissinger: Weve agreed that the military program will con-
tinue on a regular schedule.
Mr. Porter: What happened to the F5 show?
Adm. Peet: It was cancelledat their request.
Mr. Kissinger: Good!
362. Memorandum from the Director of Operations Policy,
Bureau of Intelligence and Research (Gardner) to Deputy
Director for Coordination, Bureau of Intelligence and
Research (McAfee)
1
Washington, September 20, 1973.
SUBJECT
ARA/CIA Meeting, 20 September 1973
PARTICIPANTS
ARAMessrs. Kubisch, Bowdler and Shlaudeman;
CIAMessrs. Phillips and [name not declassified]; INRMr. Gardner
Chile
Mr. Kubisch said he was slated to testify before a subcommittee of
the House Foreign Affairs Committee and needed guidance.
2
Thus far
he had been extremely lucky in not having been pressed on whether
the USG had given assistance to the opposition parties in Chile. At one
point, on September 20 [12], he had been asked in a Congressional
hearing whether we had helped the political opposition during Al-
lendes regime, but had been able to fend off the question by concen-
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Box 1, Chile, 40 Committee Action After September 1970. Secret.
2
For Kubischs opening statement before the Subcommittee on Inter-American Af-
fairs of the House Foreign Affairs Committee on September 20, see the Department of
State Bulletin, October 8, 1973, pp. 464466.
378-376/428-S/80023
938 Foreign Relations, 19691976, Volume XXI
trating on the point that we had had nothing to do with the coup.
3
He
did not however expect to elude the question indefinitely.
Mr. Phillips advised Mr. Kubisch that if he were asked in Congress
about the activities of CIA, he should refer his interrogators to CIA. Mr.
Kubisch agreed after receiving Mr. Phillips concurrence that he was
however fully authorized to say that no element of the CIA had been
involved in the coup. To Mr. Gardners point that this ploy would not
be a suitable riposte to questions from the press, he said that he be-
lieved that he could fend off questions from this source. Mr. Kubisch
then noted that this left the question of what he should say were the
question not focused on CIA, and was phrased in terms of what the
USG had done. After some thought about this possibility, the best an-
swer the group could come up with was that Mr. Kubisch should
merely assert that he was not prepared to go into the history of our rela-
tions with Chile. If hard pressed, he would refer his interrogators to his
superiors in the Department.
Mr. Phillips, in response to Mr. Kubischs query about how much
of the roughly [dollar amount not declassified] dollars approved by the 40
Committee in August to aid the Chilean opposition had actually been
paid out,
4
said that [dollar amount not declassified] had been spent. Mr.
Phillips added that this brought up another question: the Ambassador
had suggested, shortly after the coup, that payments to the private
sector might be resumed. Agency headquarters had instructed the sta-
tion to hold off until the matter had been discussed with State. Mr.
Shlaudeman said that in his view no such disbursement should be
made without specific authority from the 40 Committee. I said that I
thought the whole August authorization of the 40 Committee should be
regarded as a dead letter; the situation to which that authorization had
been addressed had wholly altered. Mr. Shlaudeman concurred; Mr.
Kubisch, who had been out of the room during this part of the discus-
sion, strongly agreed when he returned. (Note: I have since suggested to
Messrs. Phillips and [name not declassified] that, in order to clean up the
record, a formal cancellation of its August action should be sought
from the Committee).
[Omitted here is discussion unrelated to Chile]
3
Kubisch testified before the Subcommittee on Western Hemisphere Affairs of the
Senate Foreign Relations Committee on September 12; see footnote 2, Document 352.
4
See Document 342.
378-376/428-S/80023
JanuarySeptember 1973 939
363. Telegram From the Department of State to the Embassy in
Chile
1
Washington, September 21, 1973, 1359Z.
188023. Subj: Relations With New Chilean Government. For Am-
bassador Davis.
1. You should arrange to meet again privately with Foreign Min-
ister Huerta ASAP. We strongly believe that meeting should take place
some time today (Friday, September 21). If for any reason Huerta is not
available, you should consider going to a higher level of the gov-
ernment, such as General Pinochet, rather than lower. We would ex-
pect you to clear any such alternate meeting with us in advance, giving
your rationale and recommendations. We are prepared to exchange
messages rapidly with you in such event.
2. The overall purpose of your meeting is to give additional sub-
stance and dimension to our evolving relationship with the new Gov-
ernment of Chile. You should convey the following message and infor-
mation, as appropriate:
3. We want our relationships with the new GOC to be as positive
and constructive as friends can make them. We believe they should be
based on mutual respect and understanding. We approach the new
government with the greatest goodwill toward Chile and the Chilean
people. We want to repair as quickly as possible damage done in the
last several years to U.S.Chile relations. We have some understanding
of the difficulties ahead for the new GOC as it faces the tasks of national
recovery and bringing Chile back to economic, political and social
health.
4. We want to assist the new GOCif such assistance is wanted
in all appropriate ways consistent with our own capabilities and the
support that will exist in the United States for such a policy. Much of
what we can and will be able to do, of course, depends upon the GOC
itself and the policies it decides to follow. We would hope to consult
closely on all appropriate matters that might affect our ability to be co-
operative and forthcoming. FYI. We have in mind such things as
human rights and investment disputes, for example, but we do not be-
lieve you should allude to these in any way in todays meeting. We in-
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Vol. VIII. Secret; Flash; Nodis. Drafted by Kubisch; cleared
by Porter (in substance), Gammon, Scowcroft (draft), Feldman (draft), and Hill (DOD)
(paragraphs 8 and 9); and approved by Kubisch.
378-376/428-S/80023
940 Foreign Relations, 19691976, Volume XXI
tend to send you further instructions on these and other subjects later.
End FYI.
5. Diplomatic relations. You should inform Huerta that a tentative
decision has been made to send a formal note to the GOC in Santiago
on Monday, September 24th, acknowledging their note of September
13th, and accepting the invitation to maintain diplomatic relations. We
intend, insofar as possible, that this be a low key event. We will have no
desire to keep this act a secret, but we believe it in both GOC and USG
interest that our private relationship be close and strong and that our
public ties be low-keyed. We will send you text of proposed note and
final authorization to deliver it separately.
2
6. We also intend to take other concrete steps immediately to dem-
onstrate both our goodwill and our desire to be helpful to the new
government.
7. Emergency medical supplies. As indicated in State 187006
3
we
are prepared to airlift 100,000 dols. in emergency medical supplies over
this coming weekend, with departure any time after noon Saturday,
Sept. 22nd. Airlift would be by USAF aircraft and could, if desired by
GOC, be in advance of official continuance of relations mentioned in
para. 5 above. We do not envisage any particular fanfare for this but
would not attempt to conceal it. Aircraft could make delivery at San-
tiago airport and depart immediately. Listing of items to be included
will be treated in septels.
8. Flares and helmets for Air Force. We stand by our offer to coop-
erate on these items as set forth in State 187007.
4
However, we hope
GOC will obtain these items from some other country, such as Brazil, if
possible. FYI. You should know that this request has put the USG in a
difficult position since we have not wanted to refuse it and yet could
not accede to it without risking considerable damage to our possibil-
ities of assisting GOC on a wide range of matters in the future. For this
reason we would like to deflect to the extent possible any requests for
firearms, ammunition, etc., at this particular time. End FYI.
9. Other military items. We understand that nothing which could
be considered controversial or objectionable is in the pipeline or pro-
grammed for the period just ahead in the way of other military items.
On this hypothesis, a decision has been made not repeat not to inter-
rupt previously planned and approved shipments of military supplies
2
See Document 365.
3
Dated September 20. (National Archives, RG 59, Central Foreign Policy File,
P7500140588)
4
Dated September 20. (Ibid., Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Vol. VIII)
378-376/428-S/80023
JanuarySeptember 1973 941
to Chile. FYI. We must continue to keep these under close and active re-
view for a time, however. End FYI.
10. Economic issues. We want to assure GOC we will be as cooper-
ative as possible in helping it restore economic viability. At same time,
GOC must move quickly to rely on its own resources, getting both ex-
port earnings and import substitution going. Thinking within the USG
is still preliminary and GOC views are welcome.
11. Short-term wheat. One most immediate concern is to get some
wheat moving from U.S. To facilitate this, we are prepared to establish
CCC credit for initial shipment if the GOC so desires (maximum of
three years, interest about 10 percent). We recognize terms are hard,
but CCC is only vehicle available to provide financing on short notice.
If GOC interested, financing arrangement can be completed in less than
a week. Request GOC and your estimate of reasonable initial increment
for early needs.
12. Stabilization. One immediate problem is to develop a financial
stabilization plan to ration foreign exchange for the remainder of 1973.
Actions to reduce fiscal deficit and move toward price stability will be
necessary to complement foreign exchange plan. IMF is knowledgeable
on Chilean situation and an early IMF mission would be desirable.
GOC should invite.
13. Among the possible sources of foreign exchange during the rest
of 1973 are the following:
IMF drawings. First credit tranche of over 40 million dols. could
be drawn quickly on basis of letter of intent. Second tranche could
follow development of stabilization plan and agreement on IMF
standby. Understand GOC has sent a delegation to Nairobi. Hennessy
of US delegation is prepared to discuss our view IMF possibility with
GOC delegation if requested.
Ex-Im line of credit for such things as spare parts.
Some form of financing of follow-on wheat requirements after
meeting emergency needs.
Emergency type assistance from other countries such as Brazil.
What is GOC estimate of nature and amount of funding required
during rest of 1973?
14. Resolution of debt issues. Resolving debt problem is integral
part of stabilization and development effort. We are reviewing possibil-
ities of finalizing US arrangement on 1972 debt along most favorable
possible route. Paris Club October meeting to resolve 1973 resched-
uling will be important. Indication of GOC commitment to stabilization
program would not only be key element in favorable Paris Club debt
rescheduling, but also have important impact on IFI lending.
378-376/428-S/80023
942 Foreign Relations, 19691976, Volume XXI
15. At your discretion, you may mention that we appreciate early
signs of constructive GOC attitude on expropriation issues,
5
and are
prepared to work closely with GOC in this area. Some form of commit-
ment to good-faith negotiations will have important bearing on further
IFI and other lending.
16. Special team. We are prepared to send a small team to Santiago
to help you and your staff meet with GOC officials at an appropriate
time to discuss full range of assistance questions and other matters of
mutual interest. FYI. We have in mind Deputy Assistant Secretary
Shlaudeman, and perhaps one or two others. Team visit would be low
key. Please send us your views on this and your thoughts as to timing.
End FYI.
Rush
5
See Document 349.
364. Telegram From the Embassy in Chile to the Department of
State
1
Santiago, September 21, 1973, 2328Z.
4511. Subj: Relations With New Chilean Government. Ref: State
188023.
2
1. Ambassador met with FonMin Huerta for approximately one
hour immediately prior to departing post. Following highlights based
upon his oral debrief at airport:
2. The meeting was a good one throughout and the FonMin
reacted positively.
3. Diplomatic relations: FonMin found quite satisfactory U.S. ten-
tative decision to act on Monday, Sept 24. He understood our desire
that this be a low-key event.
1
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 777,
Country Files, Latin America, Vol. VIII. Secret; Niact Immediate; Nodis.
2
Document 363.
378-376/428-S/80023
JanuarySeptember 1973 943
4. Emergency medical supplies: As reported Santiago 4503,
3
FonMin was deeply appreciative of our offer, agreed with low-key
handling and asked that airlift arrive soonest.
5. Short-term wheat: FonMin was appreciative of US willingness to
establish CCCcredit for initial shipment. He said he would have to con-
sult on quantities and contact us thereafter.
6. Stabilization and economic issues: Huerta indicated that new
govt gives economic stabilization very high priority. He indicated that
govt will have to develop plans in this area and for the moment is
guided by two basic precepts:
A. New govt thoroughly appreciates important contribution
which private investment can make to economic well-being and na-
tional development and intends to rely heavily upon it.
B. New govt recognizes that it cannot return to 19th century eco-
nomic liberalism and must be concerned with income distribution and
assure that less advantaged sectors of society share in economic
benefits.
7. Expropriation issues: Before Ambassador could raise this sub-
ject, FonMin inquired whether Ambassador had instructions on it.
Huerta gave every indication of having in mind the possibility of
opening discussions on this matter in US at time of his UNGA
attendance.
8. Special team: FonMin was receptive to this idea but said he
would like to consult a few people and get back to us. Accordingly, be-
lieve decision on timing should await further comment from Huerta.
Thompson
3
Dated September 21. (National Archives, RG 59, Central Foreign Policy File,
P7500112095)
365. Editorial Note
As the Nixon administration prepared to extend formal diplomatic
recognition to the military junta under General Augusto Pinochet on
September 24, 1973, the Department of State began to receive more re-
ports, and more questions, on human rights violations in Chile, in-
cluding on the welfare and whereabouts of U.S. citizens there. Assist-
ant Secretary of State John B. Kubisch addressed these concerns in his
testimony to the House Subcommittee for Inter-American Affairs on
378-376/428-S/80023
944 Foreign Relations, 19691976, Volume XXI
September 20: We have also been concerned with reports violations of
human rights in Chile. However, to my knowledge, many of these re-
ports are unsubstantiated and not necessarily indicative of the policies
to be followed by the new government of Chile once the situation there
has fully stabilized. (Telegram 187235 to Santiago, September 20; Na-
tional Archives, RG 59, Central Foreign Policy File, [no film number])
Senator Frank Church (D-Idaho), who chaired the Senate Subcom-
mittee on Western Hemisphere Affairs, was less sanguine. During a
telephone conversation that morning with Henry Kissinger, Secretary
of State Designate, Church remarked:
Theres one thing thats been weighing heavily on my mind and
thats the question of political asylum for these large numbers of people
that have been taken into custody in Chile and it occurs to metwo
things, first I understand there are or may be some American citizens
among them and I assume the State Dept is pursuing it at the moment,
the other thing is that the OAS as I recall has a council or commission
that deals with questions of political asylumand I am wondering if
we have done anything to urge the OAS to look into this question on
strictly humanitarian grounds.
Kissinger acknowledged that he had not had the chance to follow this
as closely as I should but promised to discuss it that afternoon at a
meeting of the Washington Special Actions Group (WSAG). (Nixon Li-
brary, Kissinger Telephone Conversation Transcripts, Box 22, Chrono-
logical File) When Kissinger raised the issue at the meeting, however,
Kubisch reassured him: That doesnt pertain to us. There are few
Americans caught up in it. The WSAG minutes are printed as Docu-
ment 361.
During the noon news briefing on September 20 at the Department
of State, reporters asked repeatedly about U.S. citizens detained in
Chile and what the Embassy was doing to secure their release. The
spokesman initially replied:
We have, from various sources, information about the Americans
and their condition [in] Chile. At the moment, it seems that perhaps as
many as six have been detained by the junta. I have some of their names
but, in other cases, next of kin have not been notified, so we would
withhold that for the time being. But, in any event, to answer the
second part of your question, weve instructed the Embassy to continue
its efforts to communicate with all American citizens who we would
have reason to believe have been detained or otherwise deflected from
their original purposes. We will do the usualthat is to say, ascertain
their welfareseek to insure their human needs, if anyand, obvi-
ously be in contact with Chilean authorities to insure that they receive
fair and equitable treatment.
The reporters asked a number of follow-up questions at the briefing but
the spokesman was unable to provide much additional information.
(Telegram 187854 to Santiago, September 21; National Archives, RG 59,
378-376/428-S/80023
JanuarySeptember 1973 945
Central Foreign Policy File, [no film number]). Later that afternoon, the
Department, therefore, instructed the Embassy as follows: Imperative
that consular officers gain access to detainees so spokesman can say so.
We note junta representative told Embassy officer they trying to im-
prove their image in foreign press. Continued refusal to allow access by
consular officers to detainees runs counter to this effort. (Telegram
187383 to Santiago, September 20; ibid., [no film number])
In response to growing public pressurefrom family members,
newspaper reporters, members of Congressthe Department and the
Embassy worked to account for numerous U.S. citizens in Chile, in par-
ticular, those either missing or detained by the military government. As
most were soon safely located, two rose to the top of the list: Charles
Horman, who disappeared on September 17; and Frank Teruggi, who
disappeared on September 20. Despite persistent prompting from
Washington, the Embassy struggled in its efforts to find either Horman
or Teruggi. (Telegram 4529 from Santiago, September 23; ibid., [no film
number]) On September 24, as the United States announced formal dip-
lomatic recognition of the new Chilean regime, the Department pressed
the Embassy again to resolve the Horman case: Department receiving
numerous inquiries. Given congressional, and other high level interest
in this case, would appreciate Embassy redoubling its efforts locate
Horman, including possibility he may be detained by Chilean author-
ities. Request status report ASAP. (Telegram 190077 to Santiago, Sep-
tember 24; ibid., [no film number]) The Embassy replied the next day:
Embassy informed that Horman missing since 17 Sept, but no
firm info on his detention. Military authorities continue deny he held at
National Stadium, which official detention center for all persons to be
held more than overnight. Consul saw list of detainees as of 19 Sept and
Hormans name did not appear as such or under any of several possible
variants. Embassy continues try locate him and all other missing
Amcits with full resources at its disposal. (Telegram 4565 from San-
tiago, September 25; ibid., [no film number])
For nearly a month after they had been reported missing, the Em-
bassy tried in vain to find Horman and Teruggionly to discover that
both had been killed before September 24. On October 2, the Embassy
reported that a close personal friend had identified Teruggis body at a
local morgue. (Telegram 4787 from Santiago, October 2; ibid., [no film
number]) The Embassy then reported on October 18 that Hormans
body had been delivered to the morgue on September 18 and then to a
local cemetery on October 3. (Telegram 5088 from Santiago, October 18;
ibid., [no film number]) Neither case has been solved. For further docu-
mentation on human rights in Chile in general and the Horman and
Teruggi cases in particularincluding the investigation and contro-
versy surrounding their deathssee (through September 24) Foreign
Relations, 19691976, vol. E16, Documents on Chile, 19691973; and
378-376/428-S/80023
946 Foreign Relations, 19691976, Volume XXI
(after September 24) ibid., vol. E11, Part 2, Documents on South
America, 19731976.
366. Memorandum From the Chief of the Western Hemisphere
Division, Directorate of Operations, Central Intelligence
Agency (Phillips) to the Executive Secretary of the 40
Committee (Ratliffe)
1
Washington, September 25, 1973.
SUBJECT
Cancellation of 20 August 1973 40 Committee Approval
1. On 20 August 1973 the 40 Committee approved $1,000 for sup-
port of Chilean political parties and private sector organizations op-
posed to the Allende regime. The military coup of 11 September 1973
changed the situation in Chile so completely that we no longer consider
the 20 August 1973 40 Committee approval to be valid.
2
2. In due course we intend to submit a new memorandum for the
40 Committee describing proposed new political and covert action op-
erations in Chile.
David A. Phillips
3
1
Source: Department of State, Bureau of Intelligence and Research, INR/IL Histor-
ical Files, Box 1, 40 Committee Action After September 1970. Secret.
2
Kissinger concurred on November 3. (National Security Council, Nixon Intelli-
gence Files, Subject Files, 40 Committee Minutes) (S)
3
Printed from a copy that indicates Phillips signed the original.
339-370/428-S/80023
Index
References are to document numbers
Acun a Rosas, Americo, 55 Agreements, U.S.-ChileContinued
Ad Hoc Interagency Working Group on Mutual Defense Assistance
Chile: Agreement (1952), 156, 182
Boeing aircraft loan request, 232 Agriculture, U.S. Department of, 275,
Consultation with Brazil and 361
Argentina, 182 Agriculture in Chile, 268, 291, 330
Continuance of, 353, 361 Air Force of Chile (FACH), 326, 330,
Decision-making by, 194 345
Export-Import Bank operations in Air Force Technical Applications Center
Chile, 199 (AFTAC):
JCS representative added to, 183 Coordinating the approach to, 145
Meyer as chair of, 181 Discussing the fate in Chile of, 147
Nationalization of companies, 256, Phasing out of:
273 Chilean position, 207, 210
Post-coup contingency planning in, U.S. position, 121, 127, 155, 159, 160
311 Withdrawal from Easter Island, 155,
USIA representative added to, 183 165, 315
Afghanistan, 350 Aircraft (see also United States military
Africa, 48 aid to Chile):
AFTAC. See Air Force Technical Boeing planes sale to Chile:
Applications Center Chilean position, 228, 231, 242, 284
Agency for International Development Discussion of, 232, 233
(AID): Letelier-Nachmanoff phone
Economic aid to Chile, 84, 121, 350 conversation on, 247
Guaranty program, 11, 17, 137 Referral to Nixon of decision on,
Loans for student exchanges, 155 234, 235
Pipeline funds, 155 Review of decisions on, 238
Planning recommendations for future C30, 18
of program, 145, 155 C47, 182, 183
Agenda for a Nation (Kissinger), 4 C130, 181, 182, 183, 232, 234, 235
Agnew, Spiro T., 173 F4, 156, 167, 173
Agrarian reform, 47, 231 F5, 18, 181, 182, 183
Agreements, international: Ilyushin turboprops, 242
Hague Convention (1899), 320, 331 Alessandri Montes, Silvia, 75, 198, 200,
Inter-American Arbitration 213
Convention (1929), 320, 331 Alessandri Rodriguez, Jorge:
Rio Treaty (1947), 106, 187, 195 Actions as President, possible, 40
Tlatelolco Treaty (1968), 195 Allende electoral win, 50, 66, 75, 89
Agreements, U.S.-Chile: As interim president, 65, 66, 68, 78, 86
Bryan-Wilson Treaty (Treaty for the CIA support for, 55
Pacific Settlement of Disputes) Impossibility of parliamentary
(1914), 318, 320, 328, 331 solution for avoiding Allende
Copper Accord (1967), 8 presidency, 115, 127
Extradition Treaty, 56 Inability to effect reforms, 26
Military Mission Agreement (1964), Leighton as Frei emissary to, 89
156, 182 Meyer meeting with, 178
947
339-370/428-S/80023
948 Index
Alessandri Rodriguez, JorgeContinued Allende Gossens, Salvador G. (see also
Military plot in response to loss of, Allende government; Inauguration
rumored, 61 of Allende)Continued
Nationalization of copper industry, As presidentContinued
Support for, 12
Military leaders opposition to, 50,
Post-election refusal to concede, 63,
89
65, 68
PDCs split in opposition to, 134
Potential cooperation with PCCh, 37
Timing for concentration of power
Presidential campaign of:
by, 159
Anacondas withdrawal from
U.S. perspectives on, 47
funding of, 35
As revolutionary, 43
Campaign trip to south, 26
Boeing planes sale to Chile, 242
Spending deficit of, 35
British support for, 116, 117
U.S. covert funding for:
Campaign allegations of links to
Anacondas requests for, 32, 33,
Soviet Union/Cuba of, 38, 90
35, 36
Castro as model for, 62
Iban ezs request for, 33
Castro conversations with, 185, 327
Types of, 55
Castro cooperation with, 43
Prospects as presidential candidate:
Catholic resistance to programs of, 47
Campaign disorganization and
CIA propaganda campaign outside
incompetence, 33, 38
Chile against, 92
Decline of, 38
Congressional conflicts with, 302
Election by Congress, possible, 50
Coup in Chile, 106, 346, 347
Freis perspectives on, 5, 27, 61
Covert U.S. funding for Chilean
Increased numbers in polling for,
elections, 37
45
Splitting of UP as goal for, 29
U.S. perspectives on, 3, 13, 23, 28
Support for Tomic, 30
Senatorial by-election (Apr. 1971), 198
Suspension of, 43
Study of constitutional overthrow of
Economic problems, CIA report on
election results, 65
emergence of, 246
U.S. perspectives on possible
Economists gathering on Prebisch
administration of, 47
report, 132
Valdes perception of U.S. as
Eight-point PDC list of assurances
supporter of, 43
requested of, 131, 134
Algeria, 277, 315
Election (Mar. 1973), 321
Allende, Hortensia Bussi Soto de, 348
Election of:
Allende Gossens, Salvador G. (see also
Alessandris statement on, 75
Allende government; Inauguration
Analysis of, 62
of Allende):
By Congress, possible, 33
AFTAC withdrawal from Easter
European views on, 69
Island, 165, 315
Frei refusal to recognize as
Allendes desire for, 207, 209, 210
president-elect, 73
Anaconda as seen by, 132, 161
Freys pessimism about, 81
Anti-American bias of, 159
Generals meeting in response to,
Anti-American charges in Chilean
65, 67
media, 163
Inevitability of, 134, 141, 146, 148
Armed forces increased concern over
U.S. policy review for the
actions of, 276
contingency of, 46 As president:
Womens support for, 37, 38, 62 Anacondas acquiescence to, 124,
Elections (Apr. 1971), 218, 219, 220 125
Elections (July 1971), 236 Argentine opposition to, 90
Enterprise visit to Chile, proposed: Brazilian opposition to, 90
Inevitability of, 134, 141, 146, 148 Allendes desire for, 207, 209, 210
References are to document numbers
339-370/428-S/80023
Index 949
Allende Gossens, Salvador G. (see also Allende Gossens, Salvador G. (see also
Allende government; Inauguration Allende government; Inauguration
of Allende)Continued of Allende)Continued
Enterprise visit to Chile, On Time cover, 142, 157
proposedContinued PDC truce proposed by, 307
Allendes regret at failure of, 216, Personal popularity of, 281
315, 327 Political objectives of, 172
Excess profits, 260, 261, 294, 302, 327 Prensa Latina interview of, 138
Freis response to possible victory of, Press conference of Oct. 23, 1970, 163
18, 50, 63, 66 Progress toward goals by, 241
Freis view of, 178 Prospects as presidential candidate,
French negotiations with, 97, 99 28, 35, 37, 38, 41
Funeral of, 250 Rescheduling of Chilean debt:
Impeachment of, possible, 345 Bilateral talks on, 327, 328
Interests and objectives of, 208 Multilateral talks in Paris on, 284,
ITT as seen by, 225, 327 297
Korrys replacement as ambassador, Political costs to Chile of, 291
225 U.S. strategy for, 275
Leftist repudiation of, 330 Schneider assassination, 162
Meetings: Seen as counter to leftists, 161
With Bush, 314 Speeches:
With Davis, 284, 285 Sept. 13, 1970, 83
With Frei, 81, 123 June 21, 1973, 330
With Kissinger, proposed, 263, 314 Strikes as opposed by, 132, 138
With Korry, 211, 225, 260, 262 Suicide of, 347, 348, 352, 353
With Meyer, 178, 179 Support by PDC leaders for, 98
With military leaders, 142 Suspension of debt repayment, 284,
With Mills, 231 285
With Nixon, proposed, 314, 323 Terrorism by forces of, 83
With Rogers, 314, 327, 331 Time interview, 101
With South American U.S. bargaining position with, 110,
revolutionaries (Nov. 1970), 114
174, 184 Use of force for imposition of
With Valdes, 123 socialism, 289
With Zumwalt, 207, 210 USIA reporting on, 112
Mercurio as barrier to strategies of, Viaux television interview, 25
255, 259 Viauxs request for meeting with, 78
Messages: Visits to the United Nations, Algeria,
From Castro, 225 Soviet Union, Cuba, Mexico,
From Nelson Rockefeller, 231, 315 Venezuela, 314, 315, 318
MIR as personal bodyguard of, 203 Allende government (see also Covert
Miranda a go-between with Korry, U.S. actions against Allende
145, 165 government):
Miranda as supporter of, 81 Apolitical stance of armed forces
Monetary liquidity, 68 under, 272, 289, 336
Narco-trafficking by Chilean As legitimately elected, 172
government, 177, 193 As lowering U.S. prestige
National Party as repudiated by, 330 internationally, 156
National Party support for, 141, 144, As military threat to United States,
161 150
Nationalization of property, 265, 279, At two-year mark, 302
285 Awareness of coup likelihood by, 353
Navy command crisis, 345 British loans to Chile, 124, 125, 138,
New York Times interview with, 142 164
References are to document numbers
339-370/428-S/80023
950 Index
Allende government (see also Covert Allende government (see also Covert
U.S. actions against Allende U.S. actions against Allende
government)Continued government)Continued
Rescheduling of Chilean Chinese Peoples Republic as
debtContinued
opponent of, 150
Declaration of intent for, 274
CIA paper on covert options for
Multilateral talks in Paris on:
dealing with, 166, 169, 179
Agreement at, 296, 297, 298, 299
Communist-Socialist differences in,
Disagreement at, possible, 298
189, 190, 269, 302
Leadership of U.S. delegation,
Congressional conflicts with, 302
286, 287, 294
Consolidation of power by, 203, 336
Memorandum of Understanding,
Covert U.S. Funding for political
294, 302, 314
opposition to, 200, 201, 213, 224,
Planning for strategy on, 280,
301
282, 286
Currency counterfeiting by, 177, 193
Second session for, 294, 297
Diplomatic initiatives in advance of,
Statement of, 298
155
U.S. decision to engage in, 284
Diplomatic relations established with
Nixons decision on, 288
communist countries by, 150
Options for, 274, 275, 298
Fear of coup by, 342
Political costs of, 291
Foreign exchange, 256, 276
U.S. strategy for, 275, 279, 286, 294
Herreras desire for post of economic
Resignation of Radical Party
czar under, 132
ministers from, 290
Latin American countries, U.S.
Restrictions on imports by, 270
discussion with, 134, 155, 160,
Retention of U.S. military mission in,
169, 175
183
Media purchases by opponents of,
Revolutions in Latin America,
188
Allendes meeting with
Narco-trafficking by, 177, 193
revolutionaries (Nov. 1970), 174,
Negotiation of commitments with,
184
159, 160
Strengthening of opposition to, 203
Outlook for Chile under (SNIE
Trade agreement with Korean
9471), 241
Peoples Democatic Republic,
PDC and PN as source of opposition
proposed, 187
to, 184
U.S. actions against:
PDCs increased effectiveness under,
Blocking of Chilean assets in the
203
United States, 121
Peruvian opposition to, 90, 104
Communist view of, 168, 169
Post-inauguration analysis of, 180
In OAS, 134
Prospects for survival of, 341
U.S. assumptions in advance of, 155
Rescheduling of Chilean debt:
U.S. credit policy toward, 257
Bilateral talks on:
U.S. game plan for coping with,
Allende-Rogers discussions, 327
possible, 134
Chilean position, 232
U.S. media reactions to, 171
Conclusion at impasse of, 328
U.S. military cooperation under, 156
Objectives and strategy for, 320
U.S. operational issues before start of,
Scheduling and background for,
158, 159, 160
316, 318
U.S. policy toward:
Secret Lima meetings, 331 Adoption of a strategy for, 172,
Binding arbitration vs. negotiations 173, 175
for, 294, 298, 328 Correct vs. hostile public posture
Chilean objectives for, 294 in, 148, 155, 158, 159, 172
References are to document numbers
339-370/428-S/80023
Index 951
Allende government (see also Covert Anaconda Copper Mining
U.S. actions against Allende CompanyContinued
government)Continued Controlar a procedures as questioned
U.S. policy towardContinued by, 240
Decisions lacking coherence for
Covert funding of Chilean candidates
dealing with, 130
by, 37
Defense Department course of
Excess profits of, 261, 294, 302
action in, 155, 167, 169
Expropriation guarantee coverage, 11,
Degree and type of hostility,
17
consideration of, 167
Freis views on, 15, 17
Expressions of generalities in, 145
Meetings of officials of:
NSC meeting on adopting a
With Connolly, 245, 248
strategy for, 172, 173
With Kissinger, 248
NSC staffs course of action in, 158
Nationalization of mines of:
Objectives of, 155
Anaconda proposal, 245
Quiet restraint in, 155, 279, 281
Anacondas litigation outside
State-Defense options paper, 167,
Chile, Allendes
171
recommendation for, 265, 285
State Department course of action
Executives views on, 12
in, 155, 167, 169
Litigation outside of Chile on, 265,
U.S. public statement on, 182, 183
284, 285
Weaknesses in, 158
Negotiations for, 221, 250
Almeyda Medina, Clodomiro:
Prospects for, 8
Compensation for nationalized
Request for Presidential statement
properties, 262
on, 204
Excess profits, 264
Special Copper Tribunals decision
Legislation on nationalization of
on, 316
property, 202, 204, 250
Special envoy on nationalization:
Meetings:
Anacondas proposal for, 244, 245,
With Kissinger, 262, 263, 264
248
With Korry, 205, 250, 251, 252, 260,
SRG consideration of, 253, 256
262
Strike against, 120, 131, 132, 138
With Rogers, 251, 262, 263
U.S. government briefings on Chile
Messages:
for, 181
From Korry, 250, 251
Wage proposals by, 120
From Rogers, 249, 250, 251, 252, 262
Andean Pact, 327
Rescheduling of Chilean debt, 316,
Anderson, Jack, 294, 296, 298, 322
331
Anderson, Robert, 244
Altamirano Orrego, Carlos, 5, 276, 349
Andes Copper Company, 17
Aluminum, 15
Andina Mine, 261
Ambrose, Miles J., 193
Antarctic research projects in Chile, 187
The American Challenge
Antarctica, 61
(Servan-Schreiber), 13
Arab-Israeli War (1967), 221
American Federation of Labor-Congress
Arbenz Guzman, Jacobo, 169, 195
of Industrial Organizations
Argentina:
(AFLCIO), 182
Allende as president, opposition to,
Anaconda Copper Mining Company:
90
Acquiescence to Allende win by, 124,
Arms purchases by, 6 125
Chile, relations with: Agreement with Chile (1969), 17
Beagle Channel dispute, 156 Alessandri campaign funding, 32, 33,
Coup in Chile, possible, 104 35, 36
Extradition of terrorists, 306 Allendes views on, 132, 161
Chileanization of mines of, 9, 13, 17 Hijackers to Chile, 304
References are to document numbers
339-370/428-S/80023
952 Index
ArgentinaContinued Armed forces of Chile (see also Coup in
Chile; Military Assistance Program; Chile, relations withContinued
United States military aid to Invasion of Chile, possible, 18, 50,
Chile)Continued 89
Coup in ChileContinued
Military aid to Chile, 358
Planning by lower-ranking officers
Wheat sales, 350
for, 126, 146, 149
Chilean Communist Party
Refusal for, 134
accusations of, 168
U.S. contacts with military officers
Communist accusations against, 168
over, 71, 72, 118, 129
Coup in Chile condemned by, 353
U.S. support for military in case of,
FMS credits for, 235
112, 113, 140, 144
Fourth option role of, 156
Venezuelan concerns over possible
Guerrilla activities in, 150, 173, 181,
attempt of, 24
182
Cut-off of military aid to:
MAP materiel for, 156
40 Committee discussion of, 138
Refugees in, 83
Korry-Ossa discussion of, 108, 120
U.S. aircraft sales to, 156, 167, 173
Suspension of MAP training
U.S. consultations with:
programs, 110, 111, 138, 140,
Against Allende government, 134,
143
169, 175
Termination in FY 1968 of grant
On Chilean links with subversives,
materiel program, 127
181, 182
Withholding rather than
On public posture to Allende
termination of deliveries
government, 155
under MAP, 133
U.S. expectations of communist rule
Determination to disallow
in Chile, 156
Communist government, 18
U.S. military aid to Chile, 232
Disarray within, 68, 77
U.S. prohibition on meat imports
Discussions with embassy defense
from, 134, 181
attaches, 118
Arguedas affair, 43
FMS credits requested by, 205, 206,
Arma, 65
232, 234
Armed forces of Chile (see also Coup in
Freis perspectives on, 6, 37
Chile; Military Assistance Program;
Increased concern about Allendes
United States military aid to Chile):
actions among, 276
Air Force sitdown, 330
Intelligence Note on, 19
Apolitical stance of:
Key officers as CIA contacts, 129
As traditional, 18, 19, 70, 86
Meeting of Generals in response to
Change in, 6, 29
Allende victory, 65
Schneider doctrine, 50, 55
Military pay scale as cause of
Under Allende government, 272,
discontent in, 24, 29
289, 336
Navy command crisis, 345
Branches size and strength, 89
Plot in response to Alessandri loss,
CIA view of, 86
rumored, 61
Communist-Socialist differences over,
Refusal to fire anti-Allende officer,
189
210
Continuation of U.S. military
Reliance on U.S. equipment of, 110
deliveries, 112, 113, 144, 181
Reorientation toward Soviet
Counter-insurgency planning by, 338 weaponry by, 279
Coup in Chile: Schneiders assassination as
Air Force plans for, 326 demoralizing to, 200
As navy reaction to Marxist Tacna Regiment, 20, 28, 55
victory, 17 U.S. military cooperation under
Capabilities for, 89 Allende government, 156
References are to document numbers
339-370/428-S/80023
Index 953
Arms transfers to Argentina, 6 BoliviaContinued
Armstrong, Willis C., 320 Chile, relations with, 6, 189, 190
Arrate Mac Niven, Jorge F., 260, 265 Communist government in, possible,
Arzac, Daniel N., Jr., 301 18
Atherton, Alfred L., 210 Government as leftist in, 195
Atomic Energy Commission (AEC), 1, Revolutionaries in, 174
47, 130 Seen as bad role model by Chilean
Augustin Edwards family, 5 conservatives, 65
Austral University, 194 Seen as unsophisticated country, 26
Australia, 25, 173, 350 Split in army of, 141
Austria, 360 U.S. military assistance to, 156
Aylwin Azocar, Patricio, 6 Bonilla Bradanovic, Gen. Oscar, 349
Bossay Leiva, Luis, 55
Bahamas, 37 Boumediene, Houari, 170
Balance of payments, 268 Bowdler, William G., 344, 354, 362
Baltimore Sun, 65 Bowers, Claude G., 231
Baltra Cortes, Alberto, 25, 29 Braden Copper Company:
Banco Hypotecario, 121 Chileanization of, 17
Bank of America, 121, 128, 138 Kennecott purchase of, 239
Bank of Wisconsin, 290 Lawsuit by, 291
Barbados, 187 Suspension of payment of debt, 284,
Barbosa, Mario Gibson, 350 285
Barnum, James, 353, 361 Bradfield, Michael, 328, 361
Barrientos Ortun o, Rene, 26 Braniff International Airlines, 83
Bay of Pigs invasion (1961), 158, 169 Brazil:
Beagle Channel, 156 Allende as president, opposition to,
Beard, Dita, 361 90
Belau nde Terry, Fernando, 19 Assistance to post-coup government,
Belgium, 275, 277 possible, 313, 350
Belser, Brig. Gen. Joseph H., 158, 183, CECLA role of, 4
187, 194, 206, 233 Chile, relations with, 104, 225, 358
Benedick, Richard E., 318, 328 Communist threat to, 173
Benes, Edvard, 96, 99 Debt rescheduling for (1964), 294
Bennett, Lieut. Gen. Donald V., 151, FMS credits for, 235
178, 293 Fourth option role of, 156
Berger, Marilyn, 204 MAP materiel for, 156
Bergsten, C. Fred, 206, 217 National Liberating Action, 174
Bethlehem Steel: Political situation in, 2
As pressured to sell, 203 U.S. consultations with:
CAP as purchaser of, 206, 216, 217 Against Allende government, 134,
Korry as negotiator, 217 169, 175
Negotiations with Chilean On Chilean links with subversives,
government, 205, 206, 208 181, 182
Signing of buy-out agreement, 216, On Pinochet junta, 350
217, 327 On public posture to Allende
Big vs. small-power relationships, 4 government, 155
Black propaganda operations, 55 U.S. duties on soluble coffee from,
Blee, David H., 178, 210 134, 181
Blue Ribbon Committee, 183 U.S. expectations of communist rule
Bohlen, Charles E., 158 in Chile, 156
Bolivia: U.S. foreign assistance to, 84
Apprehension over events in Chile, Bridgewater, Dolph, 361
104 Brims, John S., 202
As Andean Pact member, 327 Brinckerhoff, Charles M., 12, 33
References are to document numbers
339-370/428-S/80023
954 Index
Briones Olivos, Carlos O., 345 Bureau of Intelligence and Research:
Intelligence Note No. 707, 19 Broe, William V.:
Bureau of Narcotics and Dangerous Allende as President, inevitability of,
Drugs, 177 146
Bush, George H.W., 314, 315
Allendes meeting with Latin
Bussi Soto, Hortensia, 348
American revolutionaries (Nov.
Butterfield, Alexander, 83
1970), 184
CIA instructions for station in Chile,
Cabrera, Lt. Col. Jose, 162
107
Cademartori Invernizzi, Jose L., 331,
CIA press comments on Viaux coup
345
attempt, 21
Caldera Rodr guez, Rafael A., 24
Coup in Chile, possibility of, 71
Calvo Doctrine, 13
Covert U.S. actions against Allende
Cambodia, 183, 361
government, 184, 201, 230
Campora, Hector, 327
Covert U.S. funding for Chilean
Canada, 197, 327
elections, 7, 28, 37, 51
Canales Marquez, Gen. Alfredo:
40 Committee meetings:
Coordinating subversive activities
Mar. 25, 1970, 31
with business leaders, 303
June 27, 1970, 41
Coup against Allende:
Aug. 7, 1970, 49
Approach to U.S. via CIA contact
Sept. 8, 1970, 70
by, 309
Sept. 14, 1970, 92
As potential leader of, 154, 293,
Oct. 6, 1970, 138
305, 306
Oct. 14, 1970, 149
CIA assessment of, 307
Nov. 13, 1970, 179
Contingency planning for, 293, 305,
Nov. 19, 1970, 184
306
Dec. 7, 1970, 188
Participation of, possible, 154
Jan. 28, 1971, 201
Meeting with Tirado, 152
July 6, 1971, 237
Ousting of, 311
Sept. 9, 1971, 258
Retirement of sought by Prats, 293
Nov. 5, 1971, 271
Seen as indiscreet, 291
FUBELT, 94
Selection by Wimert for funding to
Legislation on nationalization of
block Allende, 151
property, 202
Canto Requelme, Hernan del, 236
Political situation in Chile, 178
Cantuarias Zepeda, Orlando O., 251
SRG meetings:
CAP. See Pacific Steel Company
Oct. 14, 1970, 150
Carabineros. See Armed forces of Chile
Oct. 17, 1970, 158
Carey, Guillermo, Jr., 79, 126
Oct. 29, 1970, 169
Carmichael, Stokely, 25
Nov. 19, 1970, 183
Carmona Peralta, Juan de Dios, 5, 123
Dec. 7, 1970, 187
Carrillo Flores, Antonio, 183
Dec. 23, 1970, 194
Carvajal Prado, Patricio, 338
Feb. 17, 1971, 206
CAS, 51, 58, 74, 75, 80
June 3, 1971, 233
Casa Chilena, 121
Sept. 9, 1971, 257
Casey, William J., 320
303 Committee meetings, 7
Casse, Marshall L., III, 318
Brown, John, 84
Castillo Velasco, Jaime, 5, 43
Bryan-Wilson Treaty (Treaty for the Castro, Fidel:
Pacific Settlement of Disputes) Allende conversations with, 185, 327
(1914), 318, 320, 328, 331 Allende cooperation with, 43
Budget, U.S. Bureau of, 11 As Allendes model, 62
Bulnes Sanfuentes, Francisco, 3, 65, 75, British views of, 69
89 Letter to Allende from, 225
References are to document numbers
339-370/428-S/80023
Index 955
Castro, FidelContinued Central Intelligence Agency
(CIA)Continued Seen as benign reformer, 165
Covert U.S. actions in Speech of July 26, 1970, 50
ChileContinued United States seen as
Funding for political parties, 224,
non-interventionist by, 89
230, 301
Uruguay as criticized by, 276
Funding for private-sector
U.S.-Chilean relations, 132, 158
organizations:
Visit to Chile (Nov.Dec. 1971), 276,
Approval of, 317, 342
291
CIA station in Santiago report
Castro, Joao A. de Arau jo, 350
on, 332
Catholic Church, 47, 83, 194
Mar. 1973 elections, 305, 308, 310,
Catholic University, 111, 194
317
Cattle, 128
Opposition to, 339, 343
Ceausescu, Nicolae, 169, 170, 173
Post-coup continuation of, 362
Cecil, Lord, 48
Funding of El Mercurio, 255, 295
CECLA (Special Latin American
Paper on options for, 166, 169, 179
Coordinating Committee), 4
Proposal for, 184
Central Intelligence Agency (CIA):
Reexamination of value of funding
Alessandri as supported by, 55
opposition forces, 329
Anti-Allende propaganda campaign
Covert U.S. funding for Chilean
outside Chile by, 92
elections, 34, 36
ARA meeting with, 290
Phase II, 54, 55, 58, 63
Boeing aircraft loan request, 235
Value of, 227
Canales approach to U.S. via contact
Cut-off of MAP aid, 138
from, 309
Economic aid to Pinochet junta, 350
Canales as assessed by, 307
Economic situation in Chile, 214, 246,
Chilean armed forces as seen by, 86
268
Christian Democrats (PDC) as seen
Frei channels from, 112
by, 55
FUBELT, 146
Church subcommittee hearings, 322,
Generals meeting in response to
324
Allendes win, 67
Communist accusations against, 168
Information Cables, 67, 185, 293, 303,
Communist Party of Chile (PCCh) as
307
seen by, 55
Information Report: Counter
Copper plot, 222, 243
Insurgency Planning by
Counterfeit currency/narcotics
Military, 338
trafficking by Allende
Intelligence Memorandum 1461/70,
government, 177, 193
66, 88
Coup in Chile:
Key Chilean military officers for
Advance notice for U.S., issue of,
contacts by, 129
354
Korrys request for visit to
Canales contingency planning for,
Washington, 139
293, 305, 306
Memoranda:
Impossibility of, 86
Chile: Conciliation, Confrontation
Prospects for, 307, 312
or Coup, 298
U.S. contacts with Chilean military
Chilean Facilitation of Subversive
on, 72
Activities in Latin America,
Covert U.S. actions in Chile:
191
Buying of Congressional votes, 55 Chilean Media Under a Marxist
Funding for FY 1974, 337, 340, 342 Regime, 191
Funding for Mar. 1973 elections, Friction within the Unidad
319, 325 Popular, 191
References are to document numbers
339-370/428-S/80023
956 Index
Central Intelligence Agency Chapin, Frank M.Continued
(CIA)Continued 40 Committee meetings, 31, 70, 149,
MemorandaContinued 179, 184, 201
Review of Political and Military Political situation in Chile, 178
Options in Chilean Electoral 303 Committee, 7
Situation, 86 Chapin, Frederic L., 11, 28
Messages: Cheyre Toutin, Gen. Emilio, 162
From Korry, 64 Chile:
Instructions to station in Chile, 107 Argentina, relations with:
To Korry, 63 Beagle Channel dispute, 156
Murder of Perez Zujovic, 238, 251 Coup in Chile, possible, 104
NIE preparation role of, 1, 47 Extradition of terrorists, 306
Preservation of assets of, 152 Hijackers to Chile, 304
Press comments on Viaux coup Invasion by Argentina, possible, 18,
attempt in Chile, 21, 22, 23 50, 89
Radical Party as seen by, 55 Military aid to Chile, 358
Schneider assassination, 162, 163, 168 Wheat sales, 350
Souper coup, 334 Australian wheat sales to, 350
State Department officials meetings Austria, relations with, 360
with, 36 Bolivia, relations with, 6, 189, 190
Status report on Chilean election Brazil, relations with, 104, 225, 358
(Apr. 1971) by, 227 Chinese Peoples Republic, relations
Talking paper on Chile, 157 with:
Track II briefing paper, 162, 168 Copper exports, 190, 291
Viaux warned against second coup, Economic aid, 291, 294
152, 154 Normalization of, 150, 155, 203
Weapons transfers to coup plotters Civility as national characteristic of,
by, 154 68
Weekly Review Special Report: The Cuba, relations with:
Chilean Military Establishment, Airline service, 232, 235
18 Application of U.S. laws relating
Cerda Garcia, Eduardo A., 345 to, 183
Cerro de Pascua Corporation: Attacks on Cuban ship and
Chileanization of mines developed embassy, 350, 353
by, 9, 17 Breaking by Chilean junta of, 349,
Expropriation guarantee coverage, 11 355
Merger with Standard Oil of Indiana, Normalization of:
8 Support by Allendes opposition
Nationalization of: for, 33, 48
Negotiations on: U.S. consultation with OAS
Lack of agreement in, 242 governments on, 183
Progress in, 225, 231, 327 U.S. position, 150, 155, 190
Resolution in, 247, 265, 336 Reorganization of Chilean
U.S.-Chilean differences over, intelligence services, 203
251 Trade, 47
CESEC poll, 62 U.S. opposition to, 134
Chapin, Dwight, 172 Cuba compared with, 165
Chapin, Frank M.: France, relations with, 65, 164, 360
Chilean election (Apr. 1971), 213, 227 German Democatic Republic,
CIA paper on covert options for relations with, 150, 190, 203
Chile, 166 German Federal Republic, relations
Covert U.S. Funding for political with:
opposition to Allende Chilean recognition of GDR, 81
government, 213, 224 Importance of, 119
References are to document numbers
339-370/428-S/80023
Index 957
ChileContinued ChileContinued
German Federal Republic, relations United States, relations
withContinued withContinued
Loan announcement, 164 Recognition of military
Rescheduling of Chilean debt, 275, juntaContinued
280, 294 Mexican position, 359
Trade, 158 Timing for, 348, 350, 353, 361,
Guatemala, relations with, 351 364
Holy See, relations with, 360 U.S. military intervention in,
Italy, relations with, 119, 150 possibility of, 48
Japan, trade relations with, 207, 214 Vietnam Democatic Republic,
Korean Peoples Democatic Republic, relations with:
relations with: Application of U.S. laws relating to
Applications of U.S. laws relating trade, 183
to trade, 183 Breaking by Chilean junta of, 349,
Breaking by Chilean junta of, 349, 355
355 U.S. need to react to normalization
Trade agreement with Allende of, 167
government, proposed, 187 U.S. promotion of delays in
U.S. promotion of delays in normalization of, 150, 155
normalization of, 150, 155 Western Europe trade relations with,
Korean Republic, relations with, 360 214
Nicaragua, relations with, 360 Yugoslavia, relations with, 360
Peru, relations with, 6, 189, 360 Chile Exploration Company, 17
Soviet military bases in, possible, 91, Chilean Copper Corporation, 10
187, 195 Chilean National Liberation Army, 174
Soviet Union, relations with: Chilean Telephone Company, 299, 322
Arms purchases, 279, 349 Chileanization. See under Copper
Breaking by Chilean junta of, 349, industry in Chile
354, 355 China, Peoples Republic of:
Chilean position, 189 Argentine guerrillas, aid to, 150
Economic aid, 241, 291, 294, 318 As opponent of Allende government,
Food aid, 361 150
Gosplan team visit, 291 Chile, relations with:
Loan for fishing port, 207 Copper imports, 190, 291
Machinery purchases, 190 Economic aid, 291, 294
Military cooperation, 156 Normalization of, 150, 155, 203
Spain, relations with, 351 Chonchol Chait, Jacques, 121, 123
Uganda, relations with, 360 Chou En-lai, 251
United Kingdom, relations with: Church, Frank F., 296, 322, 352, 361
Loans, 124, 125, 138, 164 Civil unrest in Chile:
Support for Allende, 65, 116, 117, Air Force sitdown, 330
119 Bakery invasions, 345
United States, relations with: Bombings, 345
Cuban position, 132, 158 Concepcion demonstrations, 302, 303
Nationalization as dominant issue High school student strike, 304
in, 241 Los Angeles strike, 303
Posture under Allende government March of the Empty Pots, 276, 281
of, 155, 156 National shop-owners strike, 304
Recognition of military junta: Opposition party rallies (Apr. 1972),
Announcement of, 365 299
Chilean position, 349, 360 Pot banging, 303, 304
Instructions for Ambassador on, Prats concern with, 323
358 Shootings, 345
References are to document numbers
339-370/428-S/80023
958 Index
Civil unrest in ChileContinued Confirmation of Chilean President (see
Truckers strike, 310, 311, 338, 339 also Congress, Chile)Continued
Vandalization of TV studio, 330 Cabinet appointments by Schneider,
Weapons searches, 345 108
Civil war, 70, 106
Congratulatory message from the
Claro Salas, Fernando (Pepe), 15
United States for, 159, 160, 164,
Claro, Ricardo, 144
169
Clements, William, 361
Covert U.S. actions:
Cline, Ray S., 58, 60, 290, 293, 337
Buying of Congressional votes, 50,
Cocaine smuggling, 177
60, 83
Coerr, Wymberley:
Chilean suspicions toward United
Covert U.S. funding for Chilean
States on, 59
elections, 28, 29, 42, 44, 60
CIA planning for implementation
Covert U.S. funding for political
of, 54, 55, 58
parties, 230
CIA position, 34
40 Committee meetings:
Dissociation from rightist forces,
Mar. 25, 1970, 31
Korry recommendation for,
Aug. 7, 1970, 49
144
Nov. 19, 1970, 184
Embassy as maintaining low
Dec. 7, 1970, 188
profile around, 116, 117
Jan. 28, 1971, 201
Feasibility of, 63
July 6, 1971, 237
Fourth option, 50, 52, 55, 156
Sept. 9, 1971, 258
Funding for, 51, 58, 59, 60
Nov. 5, 1971, 271
Kissinger-Nixon talks on, 82
Coffee, 134, 181
Nixons approval of, 93, 94
Colby, William E.:
Planning for, 53
Allendes suicide, 353
Policy decisions, lack of coherence
Coup in Chile, 353
in, 130
Covert U.S. actions in Chile, 339, 340,
Post-election analysis of, 63
356
Postponement of Phase II, 44, 51
WSAG meetings, 350, 353
Private vs. public funding, 37
Colombia:
State Department planning meeting
As Andean Pact member, 327
for, 28, 29
U.S. consultation against Allende
Status report on, 57
government with, 134
U.S. courses of action around:
U.S. consultations on public posture
Need for rethinking of, 64
to Allende government, 155
Pessimism about, 68
U.S. inaugural delegation to, 165
Secrecy as need around, 74, 80,
Venezuelan concern over possible
88
coup attempt in Chile, 24
Washingtons uncertainty around
Columbia Broadcasting System (CBS),
Korrys actions:
65
Communication failures between
Commerce, U.S. Department of, 182
Korry and State Department,
Commodity Credit Corporation (CCC),
117
361
Johnson-Kissinger conversation
Compan ia de Petro leos de Chile
about, 122
(COPEC), 121, 135
Kissingers call for more
Confederation of Workers (Chile), 162
supervision of Korry, 100 Confirmation of Chilean President (see
Lack of U.S. channels to Frei, 112 also Congress, Chile):
Meyers call for Korry to pull Alessandri as interim president, plan
back, 109, 111 for, 65, 66, 68, 78, 86
Vakys desire to rein in Korry, Alessandris selection as president,
possible, 50 76, 95, 98
References are to document numbers
339-370/428-S/80023
Index 959
Confirmation of Chilean President (see Congress, Chile, Acts of (see also
also Congress, Chile)Continued Nationalization of
Frei refusal to recognize Allende as property)Continued
president-elect before, 73 Payment for expropriated property,
Freis actions to influence, 81 250
Freis attitudes around, 81 State of Emergency laws, 311
Freis early resignation plan, 83, 85, Congress, U.S.:
102 Covert U.S. actions in Chile, 352, 356,
Generals meeting in response to 362
Allendes win, 65, 67 IDB loans to Chilean universities, 194
Generals meeting with Allende and Military aid to Chile, 6, 358
Teitelboim, 142 Rescheduling of Chilean debt, 282
Impossibility of parliamentary U.S. government briefings on Chile
solution for avoiding Allende to, 181, 182, 183
presidency, 108, 115, 127 Congress, U.S., Acts of (see also
National support for Allende in, 141, Hickenlooper Amendment):
144, 161 Gonzalez Amendment, 312, 313, 328
Need for as shown by polling results, IDB Replenishment Bill, 196
53 P.L. 480, 84, 187, 194
PDC rejuvenation of opposition to Trading with the Enemy Act (1917),
Allende before, 77 187
PDC vote against Allende, 123 Connally, John B.:
Situation in Chile prior to, 65, 66, 70, Boeing aircraft loan request, 234, 235,
101 238
UP consolidation of power in period Nationalization of property:
leading up to, 79, 81, 85 Appointment of special envoy, 244,
U.S. concern over Chilean inaction 253, 256, 257
around, 140 International support for
Congo, Democatic Republic of, 197 opposition to seeking of, 277
Congress, Chile (see also Confirmation Meeting with Anaconda executives,
of Chilean President): 245, 248
Allende as elected by, possible, 33 Statement on compensation for, 267
Buying of votes of members of, 55, Rescheduling of Chilean debt:
60, 83 Agreement on, 299
Conflicts with Allende, 302 Binding arbitration for, 294
Election of President by, Need for, as Leadership of U.S. delegation to
shown by polls, 53 Paris talks on, 287, 294
Support levels for Presidential Nixons decision on, 288
candidates, 41 Options for, 274, 275
Congress, Chile, Acts of (see also Planning for strategy on, 286
Nationalization of property): Constantine, King (Greece), 350
Agrarian Reform Law, 231 Continental Copper and Steel
Amendment for economic Industries, 11, 17
restructuring, 302 Controlar a General:
Amendment for nationalization of Claims of independence of, 250
copper industry: Role in determining worth of
Chilean desire for, 190, 194 nationalized companies, 240, 242
Deadline for, 139 Suspension of debt repayment, 284,
Modification of, 216 285
Timing for, 215 Cooper, Charles, 361
U.S. initiative to influence, 155, 205 Copper Accord (1967), 8
Amendment for unicameral Copper industry in Chile:
legislature, 272 Anaconda Copper agreement for
Constitutional Reform Bill, 26, 293 Chileanization of, 8, 9, 13, 17
References are to document numbers
339-370/428-S/80023
960 Index
Copper industry in ChileContinued Coup in ChileContinued
Assessment of effectiveness of covert Chile as second-largest producer, 62
U.S. actions toward, 356, 362 Chileanization of:
Canales coordination with business As nationalization, 215
leaders for, 303
Freis plans for, 8, 9, 10, 11
Consequences of, possible, 306
Kissinger meeting with Meyer and
Constitutional, 329
Korry on, 13
Contingency planning for, 293, 305,
Likelihood under any government
306
of, 1
Coordination of subversive activities,
Of Cerro de Pascua mines, 9, 17
303
Of Kennecott mines, 9, 13, 33
Creeping, 344
Through excess profits law, 15
Election of Mar. 1973 affected by,
U.S. perspectives on, 26
possibly, 306
Chinese Peoples Republic imports of,
For preventing Allende presidency:
190, 291
Agreement on, 115
Eximbank financing of expansion of,
Allendes response to, possible, 106
8
Analysis of options for, 78
Frei meetings with officials of, 12
As Navy reaction to Marxist
Freis position on nationalization of,
victory, 17
1, 15
As sole remaining option, 108
High copper prices, 8, 47
As U.S. policy, 154
Price drops, 197
Chilean senators advocacy of, 119
Tomics plan for purchasing share of,
CIA view as impossible, 86
11
Civil war as result of, possibility,
Western European copper purchases,
26, 70, 106
194
Counter coup, possible, 106
Copper plot, 219, 222, 243
Diplomatic recognition of
Copper prices, 8, 47, 197
government resulting from,
Copper stockpile, U.S., 173, 175, 197
106
Corporacion de Cobre (CODELCO):
Freis views on, 6, 65, 106
Assessment of value of property to
Generals meeting, 65
be expropriated, 250
Imminent likelihood of, 105, 106,
Formation of, 265
146
Litigation in foreign courts over
Kissingers views on, 66
payment of debt, 284
Lack of secrecy for, 103
Corrigan, Robert F., 350, 353
Leftist response to, possible, 106
Council for Latin America:
Military capabilities for, 89
Anacondas funding of Chilean
Militarys refusal for, 134
candidates, 37
NSC views on, 66
Anacondas request for U.S. funding
Palmas plans for, 136
for Alessandri campaign, 32, 33
Planning by lower-ranking officers
Seen as indiscreet, 35
for, 126, 146, 149
Council for the Americas, 181, 182, 183
Pressure on economy for
Counter insurgency, 338
provoking, 121
Country Assistance Strategy Papers
Prospects for, 6, 65, 70, 71
(CASP), 96
Replacement of cabinet ministers
Coup in Chile:
by military leaders, 102, 103,
Air Force plans for, 326 105
Allende governments awareness of Schneider as necessary for
likelihood of, 353 effectiveness of, 144
Allende governments fear of, 342 Schneiders assassination as
Argentine condemnation of, 353 obstacle to, 168
Arguments against probability of, 329 Timing for, 89
References are to document numbers
339-370/428-S/80023
Index 961
Coup in ChileContinued Covert U.S. actions against Allende
For preventing Allende governmentContinued
presidencyContinued Church subcommittee hearings on,
U.S. assistance for, 70, 106, 140, 144 322, 324
U.S. concern with Chilean inaction
CIA instructions for station in Chile,
around, 140
107
U.S. contacts with Chilean military
CIA paper on options for, 166, 169,
on, 71, 72, 118, 129
179
U.S. corporate role in, 120, 121
CIA program as proposed for, 184
U.S. military aid cut-off threat as
Congressional questioning on, 352,
motivation for, 120, 138
356, 362
U.S. military representatives as
Danger of exposure of, 337
used for advocacy for, 119
Davis call for immediacy in
U.S. representative for
implementation of, 279, 283
orchestration of, proposed, 119
Funding for, El Mercurio, 255, 258,
U.S. support for Frei in, 112, 113,
259, 290, 295
117, 140, 144
Funding for political parties, 201, 213
U.S. support of armed forces in
Action plan for, 292
case of, 112, 113, 140, 144
Christian Democatic (PDC):
U.S. weapons transfers to coup
Additional funds for, 201, 213
plotters, 154
For anti-Allende faction in, 137,
Foreign assistance to new
230
government after, possible, 313
Media purchases, 188, 200
Fourth option discussions, 50, 52,
Request for, 213, 224, 230
55, 156
Democatic Radical (PDR), 200, 201,
Guerrilla warfare as possible
270, 271
response to, 313
Election (July 1972), 301
Increased possibility of, 326
Election (Mar. 1973), 270, 271, 308,
Initiation of, 346
317, 319
Kissinger-Nixon conversations on,
For FY 1974, 337, 340
352, 357
For get-out-the-vote efforts, 317
Lack of support for, 341
For opposition to plebiscite, 270,
Likelihood of, 306, 344
271, 272
Mexican condemnation of, 348, 353
Independent Radical Movement of
P&L attempts to provoke, 303
the Left (MRII), 270, 271
Potential leaders of, 154, 293, 305,
National (PN):
306, 307
CIA report on, 325, 337, 340
Prats as potential leader of, 89, 306
40 Committee approval of, 200,
Prospects for, 307, 312, 313
201, 270, 271
Provoking through economic decline,
Organization improvements
121, 128
resulting from, 325, 339
Sixty-day plan for, 305
Funding of:
Souper coup (June 1973), 334, 335
Appropriation of, 200
Success of, 347, 349
For Apr. 1971 elections, 200, 227
Support by international financial
For Jan. 1972 by-elections, 278
institutions in event of, 106
For July 1972 by-elections, 301
Time seen as premature for, 305
For private-sector organizations:
U.S. advance notice of, issue of, 353,
Approval of, 317, 342 354
Cancellation of, 362 U.S. response to assistance requested
CIA station in Santiago report by coup plotters, 312, 313
on, 332 Viaux role in, possible, 50
Get-out-the-vote efforts, 317 Covert U.S. actions against Allende
Opposition to, 339, 342, 343 government:
Advance planning for, 155 Post-coup continuation of, 362
References are to document numbers
339-370/428-S/80023
962 Index
Covert U.S. actions against Allende Covert U.S. actions in ChileContinued
1970 Presidential electionContinued governmentContinued
Status report on, 57
Funding ofContinued
Tomic as supported in, 30, 40
For private-sector
As danger to U.S. Vietnam policy, 57,
organizationsContinued
87
Proposals for, 305, 308, 310
Confirmation of Chilean President:
Plebiscite opposition, 270, 271, 272
Buying of Congressional votes, 50,
Post-coup cancellation of, 366
60, 83
Recommendations for FY 1974, 337,
Chilean suspicions toward United
340, 342
States on, 59
Identification of possibilities for, 78
CIA planning for implementation
Mar. 1973 election:
of, 54, 55, 58
Funding for private-sector
CIA position, 34
organizations:
Disassociation from rightist forces,
CIA station in Santiago report
Korry recommendation for,
on, 332
144
Get-out-the-vote efforts, 317
Embassy as maintaining low
Proposals for, 305, 308, 310
profile around, 116, 117
New opportunities for, 283
Feasibility of, 63
Nixon approval of, 93, 94
Fourth option, 50, 52, 55, 156
Possible game plan for, 134
Funding for, 51, 58, 59, 60
Post-coup assessment of effectiveness
Nixon-Kissinger talks on, 82
of, 356, 362
Nixons approval of, 93, 94
Selection of two General Staff Planning for, 53
Officers for funding for, 151 Policy decisions, lack of coherence
in, 130 Stockpiling Chilean currency for, 184
Postponement of Phase II, 44, 51
Covert U.S. actions in Chile:
Private vs. public funding, 37
1964 presidential election:
Status report on, 57
Amounts of, 335
U.S. courses of action around:
Crimmins-Korry conversation on,
Need for rethinking on, 64
28
Pessimism around, 68
Dungan as organizer of, 121
Secrecy as need around, 74, 80,
Effects of, 3, 90
88
Efforts as widely known, 32, 33
Washingtons uncertainty around
Mar. 1965 Congressional election, 3
Korrys actions:
Mar. 1969 Congressional election, 3, 7
Communications failures
1970 Presidential election:
between Korry and State
Anaconda request for Alessandri
Department, 117
funding, 32, 33, 35, 36
Johnson-Kissinger conversation
CIA position, 34, 36
about, 122
Continuation with Phase I, 44
Kissingers call for more
Expansion of program for:
supervision of Korry, 100
Mechanisms for, 37
Lack of U.S. channels to Frei, 112
Post-election activities, 35, 39
Myers call for Korry to pull
Recommendations for, 38
back, 109, 111
Reservations and objections to,
Vakys desire to rein in Korry,
36, 39, 41
76, 95, 98
Suspension of, 43
Frei as supported for election, 3, 33,
Holdover of Phase I, 55
107, 335
Planning for, 53
Funding for Chilean elections,
Policy decisions, lack of coherence
Opposition to expansion of, 41,
in, 130 42
State Department planning meeting Funding for political parties:
for, 28, 29 Democatic Radical (PDR), 28, 29, 35
References are to document numbers
339-370/428-S/80023
Index 963
Covert U.S. actions in ChileContinued CTC, 260
Cuba: Funding for political
Allendes visit to, 315
partiesContinued
Argentine hijackers release to, 304
For fostering dissention within UP,
Bay of Pigs invasion (1961), 158, 169
29, 270
Campaign allegations of Allende
Schisms in Radical Party,
links to, 38, 90
promotion of, 29, 35, 37
Chile, relations with:
Post-coup operations, planning for,
Airline service, 232, 235
366
Application of U.S. laws relating
Covington & Burling LLP, 239
to, 183
Credit squeeze, 254
Attacks on Cuban ship and
Crimmins, John H.:
embassy, 350, 353
Allende government at the two-year
Breaking by junta of, 349, 355
mark, 302
Normalization of:
Brazilian aid to junta, 350
Support by Allendes opposition
Chileanization of copper companies,
for, 33, 48
11
U.S. consultation with OAS
Compensation for nationalized
governments on, 183
properties, 266
U.S. position, 150, 155, 190
Confirmation of Chilean President,
Reorganization of Chilean
Covert U.S. actions around, 63,
intelligence services, 203
74, 76
Trade, 47, 183
Congressional conflicts with Allende
U.S. opposition to, 134
government, 302
Chile compared with, 165
Copper negotiations, 240 Jamaica, relations with, 183
Coup in Chile, 71, 305, 313 Mexico, relations with, 183, 187
Missile crisis (1962), 158 Covert U.S. actions in Chile, 63, 74,
Naval support facility in, 195
76, 305, 308
OAS participation by, 187, 353
Covert U.S. funding for Chilean
OAS sanctions resolution on, 181,
elections:
182, 187, 195
Continuation with Phase I, 44
Soviet submarine base crisis, 165
Fourth option, 50, 55
Trade sanctions on, 187
Korry conversation on, 28
United States, relations with, 187, 358
Mar. 1973 elections, 319, 325
U.S.-Chilean relations as seen by, 132,
Mechanisms for expansion of, 37
158
Opposition to expansion of, 41, 42
Cultural exchange, 279
Postponement of Phase II, 44, 51
Cushman, Gen. Robert E., Jr.:
State Department planning
40 Committee meetings, 31, 41, 49,
meeting, 28, 29
149, 184, 237, 271
Economic sanctions against Chile, 215
FUBELT, 94
40 Committee meetings, Sept. 8, 1970,
IDB loans to Chilean universities, 194
70
Narco-trafficking by Chilean
IDB loans to Chilean universities, 194
government, 177
Jack Anderson column on ITT
SRG meetings, 150, 158, 183, 194
memoranda, 298
Cyr, Krest, 33, 120, 126
Kunakov Archives, 56
Czechoslovakia:
Nationalization of property, 194, 202,
Communist takeover (1947), 96, 99
206, 239
Concocted message about
Rescheduling of Chilean debt, 284,
Communist takeover in, 131
318, 328, 331 PCCh as first communist party to
SRG meetings, 194, 206, 298 support invasion of, 150
U.S. funding of El Mercurio, 290 Soviet invasion (1968), 106
References are to document numbers
339-370/428-S/80023
964 Index
Dam, Kenneth W., 257 Debt repayments, suspension of, 284,
285 Davis, Angela, 350
Defense, U.S. Department of:
Davis, Elizabeth, 348
Boeing aircraft loan request, 232, 235
Davis, Jeanne W.:
Courses of action toward Allende
NSSM 97, 53
government, 155, 167, 169
Political situation in Chile, 178
Covert U.S. actions against Allende
SRG meetings, 169, 194, 257, 298
government, 340
WSAG meetings, 350
NIE preparation role of, 1, 47
Davis, Nathaniel:
Options paper, 167, 171
Allendes death, 348
Tank delivery to Chile, 205
Civil unrest in Chile, 330
Defense Attache Office (DAO):
Compensation for nationalized
Chilean military officers discussions
properties, 262
with, 118
Confirmation as ambassador, 244
Continuation of military deliveries,
Coup in Chile, 305, 309, 348
144
Covert U.S. actions in Chile:
Cutbacks in information gathering
Funding for elections, 271, 317, 319
by, 23, 80
Funding for FY 1974, 337, 342
Reports from, 50, 115
Funding for private-sector
Defense Intelligence Agency (DIA), 118,
organizations, 305, 308, 339,
177
342, 343
Denny, George C., 325
Need for immediacy in
D az Casanueva, Humberto, 315
implementation of, 279, 283
Dominican Republic, 106, 155, 158, 165
U.S. funding of El Mercurio, 295
Donaldson, Rear Adm. James C., Jr.,
Election (Jan. 1972), 291 188
Initial assessment on Chile, 276 Douglas-Home, Alec, 138
Dow Chemical Co., 145, 161 Meetings:
Drought, 2, 8, 10, 14
Kissinger with Almeyda, 263, 264
Duhalde, Alfredo, 5
Of Kissinger with Allende,
Dulles, John Foster, 195
proposed, 314
Dungan, Ralph A., 112, 121, 131
Of Nixon with Allende, proposed,
Duran Neumann, Julio A. G., 55, 65, 67,
314
75
Of Rogers with Allende, proposed,
314
Eagleburger, Lawrence S., 353
With Allende, 284, 285
Easter Island, 155, 165, 207, 315
With Pinochet, 363
Eaton, Samuel D., 155, 187, 194, 233,
Pinochet junta:
257, 298
Instructions for dealing with, 350,
Echeverria Alvarez, Luis, 348, 353
361
Economic development in Chile, 26
Pinochets meeting with Col.
Economic sanctions against Chile, 214,
Urrutia, 349
215
U.S. communications with junta
Economic situation in Chile (see also
leaders, 348, 353, 361, 363
Inflation):
U.S. recognition of, 358, 361, 364
Agricultural decline, 268, 291, 330
Rescheduling of Chilean debt, 291,
Authorization of public statements
297, 316, 323
on, issue of, 101
SRG meetings, Sept. 9, 1971, 257
Balance of payments, 268
U.S. public posture toward Allende
CIA report on status of, 268
government, 279
CIA report on vulnerabilities in, 214
Visit to Washington, 352, 353 Copper price drops, effect on, 197
De Cubas, Jose, 32 Credit squeeze, 254
De Gaulle, Charles, 4 Davis initial assessment on, 276
References are to document numbers
339-370/428-S/80023
Index 965
Economic situation in Chile (see also Edwards Eastman,
August nContinued Inflation)Continued
As El Mercurio owner, 62, 271, 290, Dependency on the United States, 83
295 Deterioration of, 137, 138, 183, 291
Election of Allende, 81
Foreign exchange, 256, 276
Meetings:
Korrys assessment of, 1, 99, 137, 214
With Helms and Kendall, 89
Marxist perspectives on, 291
With Kissinger and Kendall, 82
Monetary liquidity, 68
With Mitchell, 89
Objectives and strategy for, 320
Passport application as leaked, 79
Price controls, 203
Possible actions after Allende
Provoking coup through pressure on,
electoral win, 66
121, 128
El Teniente mine, 8, 239, 284, 285
Rescheduling of debt:
Elections in Chile (see also Presidential
Bilateral talks on:
election in Chile (Sept. 1970)):
Allende-Rogers discussions, 327
1958, 3
Chilean position, 232
1964:
Conclusion at impasse of, 328
Constitutional reform promise in,
Objectives and strategy for, 320
28
Scheduling and background for,
Covert U.S. actions:
316, 318
Amounts of U.S. funding for, 335
Secret Lima meetings, 331
Crimmins-Korry conversation
Binding arbitration vs. negotiations
on, 28
for, 294, 298, 328
Dungan as organizer of, 121
By military junta, 355
Effects of, 3, 90
Chilean objectives for, 294
Efforts as widely known, 32, 33
Declaration of intent for, 274
Edwards support of Frei in, 62
Multilateral talks in Paris for:
Frei as receiving mandate in, 47
Agreement at, 296, 297, 298, 299
Freis campaign promise for
Disagreements at, possible, 298
Chileanization in, 8, 13, 17
Leadership of U.S. delegation,
Soviet financing of Allende
286, 287, 294
campaign in, 90
Memorandum of Understanding,
Mar. 1965, 3
294, 302, 314
Apr. 1967, 3
Planning for strategy on, 280,
Dec. 1967, 37
282, 286
Mar. 1969:
Second session for, 294, 297
Covert U.S. activities around, 3, 7
Statement of, 298
Final 303 Committee Report on, 3,
U.S. decision to engage in, 284
7
Nixons decision on, 288
Outlook for, 1
Options for, 274, 275, 298
PDC losses in, 17
Political costs to Chile of, 291
Apr. 1971:
U.S. strategy for, 275, 279, 286, 294
Municipal elections:
Restrictions on imports, 270
As UPs best showing, 289
Socialization of, 268
Covert U.S. support for, 200, 230
Time bombs in, 269
Outlook for, 215
U.S. perceptions of economic
Progress reports on campaign
development, 26
for, 213, 216
Wage increases vs. productivity, 302 Results of, 218, 219
Zaldivars analysis of, 121, 135 Value of covert U.S. assistance
Economic warfare, 183 in, 227
Ecuador, 165, 204, 327 Senate by-election:
Edwards Eastman, August n: Withdrawal of Silvia Alessandri
As Frei supporter, 62 as opponent in, 198, 200, 213
References are to document numbers
339-370/428-S/80023
966 Index
Elections in Chile (see also Presidential Enterprise (aircraft carrier), 207, 209, 210,
216, 315, 327 election in Chile (Sept.
Ercilla, 5, 215 1970))Continued
ESSO, 120, 121, 135, 138 Apr. 1971Continued
Estrada, Genaro, 351
Senate by-electionContinued
Estrada Doctrine, 351
Zaldivar loss in, 218, 219, 220
Evans, Rowland, 174
July 1971 (Valparaiso by-election),
Excess profits:
236, 237, 241, 281
As deduction from amount owed
Jan. 1972 by-election, 276, 278, 289,
copper companies, 264, 266
291, 292
Chileanization through law on, 15
July 1972 by-election, 301
Defining, 327
Mar. 1973:
Findings on, 260, 294
As being long after Presidential
Kissinger-Almeyda discussion of, 264
election, 47
Retroactive application of law on, 266
Covert U.S. funding for private
Signing of decree on, 261, 302
sector during, 305, 308, 310,
U.S. position, 263
317, 332
Executive privilege, 322, 324
Covert U.S. program for political
Exotica Mine, 17, 261, 265
parties for, 270, 271, 308, 317,
Export-Import Bank:
319
Boeing aircraft loan request:
Early U.S. planning for, 227
Chilean position, 228, 231, 242, 284
Effect of possible coup on, 306
Discussion of, 232, 233
Plebiscite for avoidance of, 241
Letelier-Nachmanoff phone
Results of, 321, 325
conversation on, 247
Start of campaigning for, 304
Referral to Nixon of decision on,
Value of covert U.S. assistance in,
234, 235
325
Review of decisions on, 238
1975, 336
Chilean debt levels to, 35
1976, 329, 336, 341
Chilean operations of, 130, 199
Chilean Congressional support for
Chilean talks with, 15
candidates in, 41
Copper industry expansion financed
Plebiscite for unicameral legislature,
by, 8
241, 259, 291
Loans to Chile:
Run-off proposal, 64
Downrating of, 128, 138, 183
Elections in the United States (Nov.
Exposure of bank to, 194
1970), 165
Reduction on guarantees and
Eliot, Theodore L., Jr.:
insurance for, 194
Bethlehem Steel buy-out agreement,
Steel company, 128
217
Suspension of disbursements of,
Church subcommittee hearings, 324
281
Compensation for nationalized
Total amounts since 1961 of, 84
properties, 266
U.S. denial of, 173, 216
Coup in Chile, 354
Peruvian loan requests, 232
Election (Mar. 1973), 321
Rapid-acceleration feature of loan
Executive privilege, 324
repayments, 11
OPIC indemnification of ITT, 322
Rescheduling of Chilean debt, 275,
Phase II, 42
280
Rescheduling of Chilean debt, 280, U.S. assumptions in advance of
318, 328 Allende government, 155
Truckers strike, 311 Exports from Chile, 291
Ellington, Duke, 279 Expropriation. See Nationalization of
Emigration from Chile, 121 property
Emmons, Robert, 240 Extradition Treaty (U.S.-Chile), 56
References are to document numbers
339-370/428-S/80023
Index 967
FACH (Chilean Air Force), 345 Forestier Haengsen, Gen. Carlos, 303
40 Committee: Federal Bureau of Investigation (FBI), 1,
Church subcommittee hearings, 322,
47, 177
324
Feldman, Mark B.:
Clearing of instructions to Korry by,
Chileanization of copper companies,
109
11
Copper plot, 222
Copper negotiations, 240
Coup in Chile, 70, 71, 78
Legislation on nationalization of
Covert U.S. actions in Chile:
property, 202, 250
Financial support for Jan. 1972
Nationalization of copper industry,
by-elections, 278, 289
254
Funding for FY 1974, 337, 342
Rescheduling of Chilean debt, 284,
Funding for Mar. 1973 elections,
318, 328
317, 319, 325
U.S. communication with junta
Funding for political parties, 200,
leaders, 363
213, 224
Fertilizer, 207
Funding for private-sector
Figueroa Serrano, Carlos, 85, 102, 103,
organizations, 305, 362
105, 108
Funding of El Mercurio, 295
The First Circle (Solzhenitsyn), 43
Mechanisms for carrying out
First National City Bank, 97, 120, 290
decisions of, 95, 98, 100
Fisher, John W.:
Need for immediacy in
Allende government after two years,
implementation of, 283
302
Phase II decisions by, 53, 54
Bush visit with Allende, 315
Post-coup cancellation of funding
Nationalization of copper industry, for, 366
202, 240, 250, 254, 266 Presidential election, 1970, 29, 35,
38, 41 Rescheduling of Chilean debt, 284,
Reexamination of value of funding
318
opposition forces, 329
SRG meeting of Feb. 17, 1971, 206
Election (Apr. 1971), 227
U.S. funding of El Mercurio, 290
Election (Jan. 1972), 278, 289
U.S. response to assistance requested
Elections (July 1971), 236, 237
by coup plotters, 313
Elections (Mar. 1973), 317, 319, 325
Flanigan, Peter M., 16, 298, 335
IDB loans to Chilean universities,
Fly, Claude, 51
111, 112
Ford, Henry, 33
Meetings:
Ford Motor Company:
Mar. 25, 1970, 30, 31
As doomed, 121
June 27, 1970, 38, 41
Financial losses of, 128
Aug. 7, 1970, 49
Intent to withdraw from Chile, 138,
Sept. 8, 1970, 63, 66, 70, 71
225
Sept. 14, 1970, 70, 86, 92
Truck manufacture in Yugoslavia, 33
Sept. 19, 1970, 104
Willingness to remain in Chile, 161
Sept. 22, 1970, 111, 112
Foreign Military Sales (FMS) credits:
Sept. 24, 1970, 117
For Argentina, 235
Sept. 29, 1970, 122, 127, 131
For Brazil, 235
Oct. 6, 1970, 134, 138, 139
For Chile:
Oct. 14, 1970, 149
Referral to Nixon of decision on,
Oct. 29, 1970, 166
233, 235
Nov. 13, 1970, 178, 179
SRG discussion of, 205, 206, 232,
Nov. 19, 1970, 182, 184
234 Dec. 7, 1970, 188
U.S. honoring of contracts for, 148, Jan. 28, 1971, 198, 201
150 May 26, 1971, 230
References are to document numbers
339-370/428-S/80023
968 Index
40 CommitteeContinued Frei Montalva, EduardoContinued
MeetingsContinued Cabinet appointments by Schneider,
July 6, 1971, 237 108
Sept. 9, 1971, 255, 258, 259 Catholic Church as supporter of, 83
Nov. 5, 1971, 270, 271 Chilean armed forces as seen by, 6,
Apr. 11, 1972, 295 37
Memorandum, Political Action Chileanization of copper companies,
Related to 1970 Chilean 8, 9, 10, 11, 13, 17
Presidential Election, 29, 38, 41 CIA channels to, 112
Messages from Korry, 85, 105 Communist Party of Chile (PCCh), 81
NSC memorandum for, 106 Confirmation of Chilean President, 81
Phase II decisions by, 53, 54 Coup in Chile:
Presidential election (1970), 29, 35, 38, Against government of, 24
41 For preventing Allende presidency,
U.S. military aid to Chile, 138 6, 65, 106
Fourth option. See Coup in Chile Need to take action by, 132, 142
Fractional Orbital Bombardment Prospects for, 6, 65
programs, 91 Covert U.S. support for election of, 3,
France: 33, 107, 335
Algerian nationalization of property Early resignation plan of, 83, 85
of, 277 French views of, 61
Allende negotiations with, 97, 99 Fundraising in Western Europe for
Chile, relations with, 65, 164, 360 PDC, 271
Frei as seen in, 61 Government as stable democracy
Rescheduling of Chilean debt, 275, under, 2
280 Hales as loyalist of, 131
Franco-Italian Bank, 135 Inflation, 1, 8, 14
Freeman, Rear Adm. Mason B., 150 Italian view of, 61, 62
Frei Bolivar, Arturo, 79 ITT memoranda, 294
Frei Montalva, Eduardo: Japanese view of, 61
Alessandris prospects as presidential Korrys constraints in discussions
candidate, 5, 27, 61 with, 48
Allende as president-elect, refusal to Land redistribution, 26
recognize by, 73 Leighton as emissary to Alessandri,
Allende as seen by, 178 89
Allende victory as responded to by, Lleras Restrapo compared with, 65
possible, 18, 50, 63, 66 MAP training program suspension,
Anaconda Copper agreement with 108
Chile, 17 Meetings:
Anti-American charges in Chilean With Allende, 81, 123
media, 163 With copper company officials, 12
Appointment of acting President by, With Korry:
105, 107 Continuation of Korry contacts
As indecisive, 89 with Ossa, 137
As potential candidate upon On Chilean militarys disallowal
resignation of interim president, of Communist government,
65, 66, 68, 78, 86, 127 18
As pragmatist, 73 On copper, 9, 15
As receiving mandate in 1964 On elections, 4, 5, 6, 37, 61
election, 47 On political situation in Chile,
As Senate President, 350 26, 269
As UN Secretary-General, possible, With Lleras Restrepo, 132, 135, 142,
117, 120 157
British views of, 61 With Meyer, 178, 269
References are to document numbers
339-370/428-S/80023
Index 969
Frei Montalva, EduardoContinued Fuentealba Moena, RenanContinued
MeetingsContinued Chileanization of copper companies,
With Miranda, 5
15
With Richardson, 79, 81, 96
Kunakov Archives, 56
With Rosenstein-Rodan, 135, 142
Nationalism of, 73, 79
With Tomic, 5
Tomic as PDC candidate, 5
With Weintraub, 12
Viaux television interview, 25
Messages:
Fulbright, J. William, 79, 183, 243
From Korry, 23, 96, 98, 111, 112
From Nixon, 14, 15, 63, 86
G10 countries, 277
To Nixon, 9, 10, 11, 13, 17, 83
Gallup Polls, 62
To Valenzuela, 83
Gammon, Samuel R., 363
Military plot in response to
Gantz, David A., 318
Alessandri loss, 61
Gardner, James R.:
Monetary liquidity, 68
Coup in Chile, 71, 313, 344, 354, 362
Narco-trafficking by Chilean
Covert U.S. actions in Chile:
government, 177, 193
Congressional questioning on, 362
National Party enmity toward, 200
Funding for Chilean elections, 28,
Nationalization of copper industry, 1,
51, 319, 325
15
Funding for FY 1974, 337
Nixon as seen by, 4
Funding for private-sector
Phase II role of, 55
organizations, 308
Political action committee formation
Reexamination of value of funding
by, 5
opposition forces, 329 Political situation in Chile, 25, 26, 27
Presidential campaign role of, 35 40 Committee meetings, 70
Resignation and re-election campaign U.S. funding of El Mercurio, 290
of, 105, 107
Geneen, Harold S., 128, 138, 322
Schneider, relationship with, 50
General Motors, 121, 145, 161
Schneider assassination, 162
General Tire, 120, 135
Strategy for 1970 elections, 5
Germany, Democatic Republic of
Tomic as presidential candidate, 27,
(GDR):
61
Allendes pledge of recognition for,
U.S. assessment of administration of,
81
1, 47
Chile, relations with, 150, 190, 203
U.S. economic aid to Chile, 4
German Federal Republic, relations
U.S. financial non-support of PDC
with, 158
during Allende presidency, 131
Search of ship of, 345
U.S. support in coup for, 112, 113,
Germany, Federal Republic of:
117, 140, 144
Chile, relations with:
Valdes relationship with, 26
Chilean recognition of GDR, 81
Viaux as seen by, 61
Importance of, 119
Viauxs coup as handled by, 29
Loans to Chile, 164
Visa issuance suspended by, 61, 65
Rescheduling of Chilean debt, 275,
Yugoslav view of, 61
280, 294
FUBELT (see also Covert U.S. actions in
Trade, 158
Chile):
Frei as seen in, 61
CIA instructions for station in Chile,
German Democatic Republic,
107
relations with, 158
CIA talks with Haig, 146
Investments in the United States by,
Genesis of, 94
327
Viaux second coup as
SPD as used in plan to prevent
counterproductive to, 154
Allende government, 86 Fuentealba Moena, Renan:
Get-out-the-vote efforts, 317 As PDC negotiation committee
member for UP talks, 137 Girdler, Lewis, 52, 318
References are to document numbers
339-370/428-S/80023
970 Index
Gonzalez, Raymond E., 331 Haig, Alexander M.Continued
Covert U.S. actions in Chile, 278, 283, Gonzalez Amendment, 312, 313, 328
295 Gordon, E.J., 275
Elections (Apr. 1971), 198 Goshko, Josh, 21
Excess profits, 261
Gottwald, Clement, 131
40 Committee meetings, 122, 127
Goulart, Joao, 350
FUBELT, 146
Greece, 350
Korry as seen by, 119
Griffin, Malcolm, 8
Korrys replacement as ambassador,
Guatemala:
212
Chile, relations with, 351
Korrys request for visit to
Overthrow of Arbenz, 169, 195
Washington, 146
U.S. consultations on public posture
Meeting of Nachmanoff with Ossa,
to Allende government, 155
272
U.S. inaugural delegation to, 165
Memos to Kissinger, 119
Guerratty Villalobos, Gen. Carlos:
Narco-trafficking by Chilean
Agreement on coup to prevent
government, 177
Allende presidency, 115
NSC meetings, 173
Generals meeting in response to
Preservation of CIA assets in Chile,
Allendes win, 65, 67
152
Opposition to Allende as president,
Rescheduling of Chilean debt, 280,
50
288
Schneider assassination, 162
SRG meetings, 158, 169
Suspension of MAP training
303 Committee meetings, 7
programs, 108
Viaux warned against second coup,
Guerrilla warfare, 313
152
Guevara, Ernesto (Che), 350
Haiti, 187
Gumucio Vives, Rafael A., 123
Haldeman, H.R., 172, 212
Guthrie, D. Keith:
Haldeman, Robert, 12, 239, 251
SRG meetings:
Hales Jamarne, Alejandro, 9, 12, 15, 131
Oct. 14, 1970, 150
Hamilton, Juan, 5
Oct. 17, 1970, 158
Hannah, John A., 175
Oct. 29, 1970, 169
Harriman, W. Averell, 8
Nov. 19, 1970, 183
Hart, John, 41, 188
Dec. 7, 1970, 187
Hartman, Arthur, 171
Feb. 17, 1971, 206
Hartman, Brig. Gen. Richard J., 257, 298
Feb. 25, 1971, 210
Heath, Edward, 117, 138
June 3, 1971, 233
Helms, Richard M.:
CIA press comments on Viaux coup
Hackett, James T., 298
attempt, 21
Hague Convention (1899), 320, 331
Copper plot, 222, 243
Haig, Alexander M.:
Coup in Chile, 70, 105, 306
Allendes meeting with Latin
Covert U.S. actions in Chile:
American revolutionaries (Nov.
Funding for elections, 7, 34, 213,
1970), 174
230, 335
Boeing aircraft loan request, 238
Funding for political opposition to
Chileanization of copper companies,
Allende, 213
9
Nixons approval of, 94
Compensation for nationalized
U.S. funding of El Mercurio, 258,
properties, 266 259, 295
Congratulatory message for Allendes 40 Committee meetings:
confirmation as President, 169 Mar. 25, 1970, 31
Copper plot, 243 June 27, 1970, 41
Coup in Chile, 119, 146, 309, 312 Sept. 8, 1970, 70
References are to document numbers
339-370/428-S/80023
Index 971
Helms, Richard M.Continued Hewitt, Ashley C.Continued
40 Committee meetingsContinued Excess profits, 261
Sept. 14, 1970, 92 Kissinger-Jarpa meeting, 189
Sept. 19, 1970, 104 Rescheduling of Chilean debt, 288
Sept. 22, 1970, 111, 112 SRG meetings, Oct. 29, 1970, 169
Sept. 29, 1970, 127 Hickenlooper Amendment:
Oct. 6, 1970, 138 As applied to military government,
Nov. 13, 1970, 179 312, 313
Dec. 7, 1970, 188 Binding arbitration as consistent with
Jan. 28, 1971, 201 requirements of, 328
July 6, 1971, 237 Companies covered by, 11
Sept. 9, 1971, 258 De facto equivalent of invocation of,
Nov. 5, 1971, 271 279
FUBELT, 94 Liabilities in the invoking of, 194
Jack Anderson column on ITT Military aid and, 279
memoranda, 298 Non-application in IPC
Meeting with Edwards and Kendall, nationalization of, 169, 267
89 Possibility of application of, 13, 153
NSC meetings, 173 Timetable for invocation of, 274
NSSM 97, 46, 53 U.S. actions to avoid implementation
Operational issues before start of of, 155
Allende government, 160 Hildyard, David, 69
Political situation in Chile, 178 Hill, Robert, 361, 363
Rescheduling of Chilean debt, 286 Hobbing, Enno, 32
SRG meetings, 169, 187, 206, 210, 233, Holdridge, John, 138, 149, 179, 271
257, 298 Holmes Task Force, 221
303 Committee meetings, 7 Holy See, 360
U.S. policy toward Allende Hormats, Robert, 280, 288, 294, 298
government, 173 House of Representatives, U.S., Foreign
Henderson, Douglas, 75 Affairs Committee, 362
Hennessy, John: HQS, 72
Church subcommittee hearings, 322 Huerta Celis, Gen. Vicente E., 50, 65, 67,
Rescheduling of Chilean debt, 275, 89, 144
294, 297, 328, 331 Huerta Diaz, Ismael, 351, 360, 363
SRG meetings, 257, 298 Hughes, Thomas L., 1
WSAG meetings, 353 Hungarians, 135
Hernandez Parker, Luis, 161, 215 Hunt, Cecil M., 250, 284
Herrera Lane, Felipe: Hurd, John G., 16
As candidate for UN Hurwitch, Robert A.:
Secretary-General, 262, 315 Covert U.S. actions in Chile, 329
As ineffective, 81 Impossibility of parliamentary
As relative moderate in Allende solution for avoiding Allende
government, 291 presidency, 115
As University rector, 183, 187 Inevitability of Allende as President,
Economic czar under Allende, desire 148
for post of, 132 NSC meetings, 171, 173
IDB loans, 158, 183 SRG meetings, 169
Meeting with Korry, 135, 138 U.S. funding of El Mercurio, 290
On Allende as President, 77, 83
Hesburgh, Theodore, 194 Iban ez Ojeda, Pedro, 33, 119, 327
Hewitt, Ashley C.: Iberia Airlines, 235
Chilean report, 203 Import liberalization, 27
Economic situation in Chile, 214, 268 Inauguration of Allende (see also
Elections, Jan. 1972, 289 Allende Gossens, Salvador):
References are to document numbers
339-370/428-S/80023
972 Index
Inauguration of Allende (see also Inter-American Development Bank
Allende Gossens, (IDB)Continued
Salvador)Continued U.S. Executive Director as
Kennecotts actions in anticipation of, uninstructed, 182, 186, 196
135 Inter-American Peace Committee, 106
Latin American delegations to, 155, Inter-American Press Association, 255
164 Interamerican Committee for the
Meyers briefing on, 178, 179 Alliance for Progress (CIAP), 8,
PDCs decision not to impede, 135, 208, 216
138 International Bank of Reconstruction
U.S. delegation to, 147, 148, 155, 159, and Development (IBRD):
160 Chilean talks with, 15
U.S. operational issues around, 158, Nationalization of property, 277
159, 160 Questioning of Chilean
Western European and Japanese credit-worthiness, 186
delegations to, 155, 164 Rescheduling of Chilean debt, 279,
Indonesia, 137 286
Inflation in Chile: Stalling of loans to Chile from, 183,
As issue in Presidential campaign 281
(1970), 26 Support in event of Chilean coup by,
Frei administration as impacted by, 1 106
Freis attempts at control of, 8, 14 U.S. consultations with, 183
Increases in rate of, 99, 304 International Monetary Fund (IMF), 15,
Reduction in rate of, possible, 268 279, 282
Tomics views on, 5 International Petroleum Company
Ingersoll, John, 177, 193 (IPC), Peruvian expropriation of:
Inostroza Cuevas, Alfonso, 279 CECLA meeting and, 4
Insunza Becker, Jorge, 121 Chilean copper nationalization links
Inter-Agency Expropriations Group, to, 8, 9, 13, 17
266 Hickenlooper Amendment not
Inter-American Arbitration Convention applied for, 169, 267
(1929), 320, 331 U.S. avoidance of confrontation over,
Inter-American Defense Board (IADB), 158
183, 187, 190 U.S.-Peruvian exchange of notes over,
Inter-American Defense College, 183 194
Inter-American Development Bank International Press Institute, 258
(IDB): International Telephone and Telegraph
Critical review of loans by, 155, 158 Corporation (ITT):
Deferral of new loans to Chile by, Allendes views of, 225, 327
128, 183 Chilean nationalization of:
Fund for Special Operations (FSO), Legislation to enable, 296, 299
155, 196 Resumption of talks on, 265, 279,
Post-coup loans from, 106 281
Rescheduling of Chilean debt, 279, Unlikelihood of compensation for,
286 353
Stalling of loans, 216, 281 U.S. position, 254, 279, 281
University loans from: Chilean takeover of operations of, 274
40 Committee discussions of, 111, Church subcommittee hearings on,
112 322, 324
Monthly reports on, 194 Investments in Chile by, 90
SRG discussions of, 183, 187, 194 Jack Anderson column on
U.S. approval of, 196, 203, 215 memoranda from, 294, 296, 298,
U.S. consultation with, 181 322
References are to document numbers
339-370/428-S/80023
Index 973
International Telephone and Telegraph JapanContinued
Corporation (ITT)Continued Assistance to post-coup government,
Kissinger meeting with delegation possible, 313
from, 335 Frei as seen in, 61
OPIC indemnification of, 299, 322 Investments in the United States of,
Investment Guarantee Program, 175 327
Irureta Aburto, Narciso, 12 Okinawas reversion to, 327
Irwin, John N., II: Recognition of Chilean junta, 350
Anaconda executives meeting with Trade with Chile, 207, 214
Kissinger and, 245, 248 Jarpa Reyes, Sergio O., 25, 89, 189, 198
Covert U.S. actions in Chile, 213, 295 Javits, Jacob, 205, 206, 352
Enterprise visit to Chile, proposed, Jessup, Peter:
209, 210 Covert U.S. actions in Chile, 230, 278,
40 Committee meetings, 111, 112, 184, 295
201, 258 40 Committee meetings, 41, 92, 138,
IDB loans to Chilean universities, 194 237, 258, 271
Korrys removal as ambassador, 192 Johnson, Lyndon B., 221, 350
Naces visit to Chile, 226 Johnson, U. Alexis:
Nationalization of property, 194, 202, Aid for anti-Allende PDC faction, 137
206, 245 Allende-Valdes meetings, 123
NSC meetings, 173 Anaconda miners strike, 120, 131,
NSDM 93, 281 132
NSSM 97, 156 Anaconda wage proposals, 120
Rescheduling of Chilean debt, 286 Congratulatory message for Allendes
SRG meetings: confirmation, 169
Oct. 14, 1970, 150 Convincing Frei to take action, 132
Oct. 17, 1970, 158 Coup to prevent Allendes
Oct. 29, 1970, 169 presidency, 105
Nov. 19, 1970, 183 Civil war as result of, possible, 70
Dec. 23, 1970, 194 Economic pressure for provoking
Feb. 17, 1971, 206 of, 128
Feb. 25, 1971, 210 Plans by lower-ranking officers for,
June 3, 1971, 233 126
Sept. 9, 1971, 257 U.S. support of Frei and armed
Apr. 11, 1972, 298 forces in case of, 112, 113
UNCTAD III conference, 294 Covert U.S. actions in Chile:
U.S. policy toward Allende Funding for Chilean elections, 32,
government, 173 42, 52, 54, 58
U.S. public statement on Allende Funding for political opposition to
government, 183 Allende, 213
USIA representation at Ad Hoc Funding for political parties, 230
Interagency Working Group on Funding for private-sector
Chile, 183 organizations, 308
Israel, 61 DAO contacts with Chilean military,
Italy: 118
Chile, relations with, 119, 150 Economic situation in Chile, 137
Frei as seen in, 61, 62 Election (Apr. 1971), 198, 219
Impact of successfully-elected Emigration from Chile, 121
Marxist government on, 172 Enriched uranium shipments to
Rescheduling of Chilean debt, 275 Chile, 127
40 Committee meetings:
Jamaica, 183, 187 Mar. 25, 1970, 31
Japan: June 27, 1970, 41
Allende inauguration, 155 Aug. 7, 1970, 49
References are to document numbers
339-370/428-S/80023
974 Index
Johnson, U. AlexisContinued Jorden, William J.Continued
40 Committee meetingsContinued Coup in ChileContinued
Sept. 8, 1970, 70
Canales contingency planning for,
Sept. 14, 1970, 92
293
Sept. 19, 1970, 104
Increased possibility of, 326
Sept. 22, 1970, 111, 112
Prospects for, 312
Sept. 24, 1970, 117
Time seen as premature for, 305
Sept. 29, 1970, 127
U.S. response to assistance
Oct. 6, 1970, 138
requested by coup plotters, 313
Oct. 14, 1970, 149
Covert U.S. actions in Chile:
Nov. 13, 1970, 179
Funding for FY 1974, 340, 342
Nov. 19, 1970, 184
Funding for political parties, 317
Dec. 7, 1970, 188
Funding for private-sector
July 6, 1971, 237
organizations, 343
Nov. 5, 1971, 271
Funding of El Mercurio, 295
Impossibility of parliamentary
Post-coup assessment of solution for avoiding Allende
presidency, 127 effectiveness of, 356
Inevitability of Allende as President, 40 Committee meeting of Apr. 11,
148
1972, 295
Korrys request for visit to
NIE 9473, 336
Washington, 139
Rescheduling of Chilean debt, 316,
Meeting with Letelier, 252
328
Messages:
SRG meetings, Apr. 11, 1972, 294, 298
From Korry, 96, 116
U.S. relations with military junta, 358,
To Korry, 92, 117
365
Political situation in Chile, 178
WSAG meetings, 350, 361
SRG meetings, 150, 158, 169, 183, 187,
Juliet Gomez, Rau l, 55
206
Suspension of MAP training
Kapp, Joe, 77
programs, 110, 140, 143
Karamessines, Thomas H.:
303 Committee meetings, 7
Coup in Chile, 105, 127, 146, 341
U.S. financial non-support of PDC
Covert U.S. actions in Chile, 137, 201,
during Allende presidency, 131
230 U.S. policy toward Allende
government, 145 40 Committee meetings:
Washingtons uncertainty about
Mar. 25, 1970, 31
Korrys actions, 112, 117
June 27, 1970, 41
Withholding rather than
Aug. 7, 1970, 49
termination of MAP deliveries,
Sept. 8, 1970, 70
133
Sept. 14, 1970, 92
Joint Chiefs of Staff (JCS):
Sept. 22, 1970, 111, 112
Ad Hoc Working Group on Chile
Sept. 24, 1970, 117
representative from, 183
Sept. 29, 1970, 127
Boeing aircraft loan request, 235
Oct. 6, 1970, 138
Communist bases in the Western
Oct. 14, 1970, 149
Hemisphere, 195
Nov. 13, 1970, 179
Covert U.S. actions in Chile, 340
Nov. 19, 1970, 184
Operational issues before start of
Jan. 28, 1971, 201
Allende government, 160
July 6, 1971, 237
Joint ventures, 11
Sept. 9, 1971, 258
Jordan, 158
Nov. 5, 1971, 271
Jorden, William J.:
FUBELT, 94
Coup in Chile:
Korrys request for visit to Canales approach to U.S. via CIA
contact, 309 Washington, 139, 146
References are to document numbers
339-370/428-S/80023
Index 975
Karamessines, Thomas H.Continued Kennedy, Col. Richard T.Continued
Meyers briefing on Chilean political 40 Committee meetings, 138, 149, 179,
situation, 178 184, 188, 237, 258
Preservation of CIA assets in Chile, Kissinger-Jarpa meeting, 189
152
Naces visit to Chile, 226
SRG meetings, 150, 158, 169, 183
NSC meetings, 173
Viaux warned against second coup,
NSSM 97, 53
152, 153
Political situation in Chile, 178
Washingtons concern about Korrys
SRG meetings:
actions, 117, 122
Oct. 14, 1970, 150
Katz, Julius L., 11
Oct. 17, 1970, 158
Kearns, Henry:
Oct. 29, 1970, 169
Boeing aircraft loan request, 235, 238,
Nov. 19, 1970, 182, 183
242, 247
Dec. 7, 1970, 186, 187
Downgrading of Chiles credit rating
Dec. 23, 1970, 194
by, 138, 183
Feb. 17, 1971, 206
Meeting with Letelier, 251
Feb. 25, 1971, 210
Suspension of Chilean debt
Sept. 9, 1971, 257
repayments, 284
Apr. 11, 1972, 294, 298
Kendall, Donald M., 82, 89
WSAG meetings, 361
Kennecott Copper Company:
Kirilenko, Andrei P., 291
Actions in anticipation of Allende
Kissinger, Henry A.:
inauguration, 135
Allende government:
Braden as purchased by, 239
Covert U.S. Funding for political
Chileanization of mines of, 9, 13, 33
opposition to, 200, 201, 213,
Chiles charges against, 314
224
Excess profits of, 261, 302
Currency counterfeiting by, 177
Expropriation guarantee coverage, 11
Media purchases by opponents of,
Meeting with U.S. government
188
officials, 239
Narco-trafficking by, 177, 193
Nationalization of mines of:
Post-inauguration analysis, 180
Appointment of committee of
U.S. credit policy toward, 257
Chilean and Finnish experts,
U.S. financial non-support of PDC
285
under, 131
Entry into talks on, 250
U.S. operational issues before start
History of, 239
of, 159, 160
Lack of payment for, 257
U.S. policy toward:
Legal actions against Chile by, 318
Adoption of a strategy for, 172,
Likelihood of, 135
173
Payment in copper for, 194
Expression of generalities on, 145
Prospects for, 8
State-Defense options paper, 167
Special Copper Tribunals decision
U.S. public statement on, 183
on, 316
Allendes interests and objectives, 208
OPIC claim by, 239, 261
Allendes meeting with Latin
Kennedy, David M, 175
American revolutionaries (Nov.
Kennedy, Edward M., 79
1970), 174
Kennedy, Col. Richard T.:
Allendes suicide, 353
Canales approach to U.S. via CIA
Anaconda Copper agreement with
contact, 309
Chile, 17 Coup prospects for Chile, 312
Anaconda miners strike, 131 Covert U.S. actions in Chile, 213, 295,
Anacondas acquiescence to Allende 340, 343
Elections (Apr. 1971), 213 presidency, 124, 125
References are to document numbers
339-370/428-S/80023
976 Index
Kissinger, Henry A.:Continued Kissinger, Henry A.:Continued
Coup to prevent Allendes Appointment and confirmation as
PresidencyContinued
Secretary of State, 352, 353, 358,
Views on, 66
359
Covert U.S. actions in Chile:
Bethlehem Steel buy-out agreement,
Against Allende government, CIA
216, 217
program proposal, 184
Big vs. small-power relationships, 4
As danger to U.S. Vietnam policy,
Boeing aircraft loan request, Chilean
87
position, 242, 284
Financial support for Jan. 1972
British loans to Chile, 124, 125, 138
by-elections, 278
British support for Allende, 117
Funding for FY 1974, 340, 342
Chileanization of copper companies,
Funding for political parties, 200,
9
201, 213, 224, 292
Church subcommittee hearings, 324
Funding for private-sector
CIA paper on covert options for
organizations, 310, 343
Chile, 166, 169, 179
Mechanisms for carrying out 40
CIA press comments on Viauxs coup
Committee decisions, 95
attempt, 21
Need for immediacy in
Communist clashes with MIR, 190
implementation of, 283
Communist-Socialist differences, 190
Phase II, 54, 57
Compensation for nationalized
Policy decisions, lack of coherence
properties, Statement on, 267
in, 130
Confirmation of Chilean President:
Post-coup assessment of
Congratulatory message for, 164,
effectiveness of, 356
169 Post-coup cancellation of funding
Talks with Nixon on, 82 for, 366
Reservations and objections to, 39 U.S. courses of action around, 68,
Secrecy as need around, 88
88
Support for Tomic, 30, 40
Washingtons uncertainty about
Uncertainty about Korrys actions
Korrys actions, 76, 122
in, 76, 98, 122
Copper plot, 219, 222, 243
U.S. funding of El Mercurio, 255,
Copper price drops effect on Chile,
258, 259, 295
197
Cuban participation in OAS, 187
Coup in Chile:
Economic situation in Chile, 137, 214,
Advance notice for U.S., issue of,
246
354
Election (1964), 335
Canales approach to U.S. via CIA
Election (Apr. 1971), 216, 218, 219,
contact, 309
220, 227
Canales contingency planning for,
Election (Jan. 1972), 278, 289
293
Election (Mar. 1973), 321
Death of Allende, 348
Election of Allende, 62, 69
Increased possibility of, 326
Emigration from Chile, 121
Initiation of, 346
Enterprise visit to Chile, proposed,
Nixon talks on, 352, 357
209, 210, 216
Post-election possibilities for, 66
Excess profits, 261, 264
Time seen as premature for, 305
Executive privilege, 324
Coup to prevent Allendes
Export-Import Bank:
Presidency:
Boeing aircraft loan request:
Chilean senators advocacy of, 119
Chilean position, 228, 242, 284
Imminent likelihood of, 105 Discussion of, 232, 233
Plans by lower-ranking officers for, Letelier-Nachmanoff phone
126 conversation on, 247
References are to document numbers
339-370/428-S/80023
Index 977
Kissinger, Henry A.:Continued Kissinger, Henry A.:Continued
Export-Import BankContinued MeetingsContinued
Boeing aircraft loan Of Bush with Allende, 314
requestContinued Of Korry with Allende, 225
Referral to Nixon of decision on, Of Nachmanoff with Ossa, 272
235 Of Pinochet with Urrutia, 355
Review of decisions on, 238 With Allende, proposed, 263, 314
Operations in Chile of, 130, 199 With Almeyda, 262, 263, 264
40 Committee, mechanisms for With ITT delegation, 335
carrying out decisions by, 95, 100 With Jarpa, 189
40 Committee meetings: With Kendall and Edwards, 82
Mar. 25, 1970, 31 With Korry, 13, 245
June 27, 1970, 41 With Letelier, 215, 242, 284
Aug. 7, 1970, 49 With Meyer, 13
Sept. 8, 1970, 66, 70 With Nixon, 82, 93
Sept. 14, 1970, 86, 92 With Nixon and Mitchell, 89
Sept. 19, 1970, 104 With Place and Quigley, 245, 248
Sept. 22, 1970, 111, 112 Memos from Haig, 119
Sept. 29, 1970, 122, 127 Messages:
Oct. 6, 1970, 134, 138 From Korry, 83, 102, 103, 108, 116
Oct. 14, 1970, 149 From McCone, 90
Nov. 13, 1970, 179 From Vaky, 109
Nov. 19, 1970, 184 To Korry, 82, 83
Dec. 7, 1970, 188 To Nixon, 84
Jan. 28, 1971, 201 Miranda as go-between to Allende,
July 6, 1971, 237 165
Sept. 9, 1971, 255, 258 Naces visit to Chile, 226
Nov. 5, 1971, 270, 271 Nationalization of property:
Apr. 11, 1972, 295 Expropriation of ITT assets, 299
FUBELT, 94 Implications of U.S. confrontation
Generals meeting in response to over, 273
Allendes win, 67 International support for
IDB loans to Chilean universities, opposition to seeking of, 277
194, 196, 203, 215 Korry as negotiator in, 206, 208,
Impossibility of parliamentary 211
solution for avoiding Allende Legislation for, 194, 216
presidency, 108 Special envoy on nationalization:
Inevitability of Allende as President, Anacondas proposal for, 245,
134 248
JCS representation at Ad Hoc SRG consideration of, 253, 256,
Interagency Working Group on 257
Chile, 183 Negotiation of commitments with
Korrys replacement as ambassador, Allende, 159
192, 204, 212, 223 NIE 9473, 336
Korrys retention as Ambassador to NSDM 93, 176, 183, 281
Chile, 16 NSSM 97, 46, 53, 130, 147, 150
Kubischs Senate testimony, 352 On Latin Americans, 187
Letter from Nixon to Frei, 14 OPIC indemnification of ITT, 322
Long-term perspectives on Chilean PDCs eight-point list of assurances
politics, 40 requested of Allende, 134
Meetings: Pinochet junta:
Edwards meeting with Kendall and Breaking of relations with
Helms, 89 Communist countries, 355
Frei with Meyer, 269 Swearing in of, 351
References are to document numbers
339-370/428-S/80023
978 Index
Kissinger, Henry A.:Continued Korea, Democatic Peoples Republic
Pinochet juntaContinued ofContinued
United States, relations with, 365
Breaking of relations by Chilean
U.S. recognition of, 358, 359, 361
junta, 349, 355
Political situation in Chile, 190
Trade agreement with Allende
Preservation of CIA assets in Chile,
government, proposed, 187
152
U.S. promotion of delays in
Rescheduling of Chilean debt:
normalization of Chilean
Agreement on, 299
relations with, 150, 155
Bilateral talks on, 316, 318, 328
Korea, Republic of, 360
Nixons decision on, 288
Korry, Edward M.:
Options for, 298
Aid for anti-Allende PDC faction,
Planning for strategy on, 280, 282,
137, 230
286
Alessandri as interim president, 65,
Second Paris session for, 294
68, 78, 86
Senate by-election (Apr. 1971), 198,
Allende government, 145, 180, 200
218
Allende inauguration, 159
Souper coup, 334, 335
Allende-Valdes meetings, 123
Soviet military bases in Chile,
Allendes interests and objectives, 208
possible, 91, 195
Anaconda Copper:
SRG meetings:
Acquiescence to Allende
Oct. 14, 1970, 130, 147, 150
presidency by, 124, 125
Oct. 17, 1970, 150, 158
Litigation outside Chile by, 265,
Oct. 29, 1970, 158, 169
285 Nov. 19, 1970, 182, 183
Miners strike, 120, 131, 132 Dec. 7, 1970, 186, 187
Dec. 23, 1970, 194 Proposal for special envoy on
Feb. 17, 1971, 205, 206 nationalization by, 244, 245
Feb. 25, 1971, 210
Request for U.S. funding for
June 3, 1971, 232, 233, 235
Alessandri campaign, 32, 33
Sept. 9, 1971, 256, 257
Wage proposals, 120
Apr. 11, 1972, 294, 298
Anti-American charges in Chilean
Suspension of MAP training
media, 163
programs, 111, 140, 143
As lame duck ambassador, 244, 248
303 Committee meetings, 7
As seen by Valdes, 219
Truckers strike, 310, 311
Boeing aircraft loan request, 228, 231,
U.S. courses of action in Latin
232
America, 170
British loans to Chile, 124, 125, 164
U.S.-Cuban relations, 187, 358
British support for Allende, 65, 116,
Viaux coup attempts, 20, 152, 153
117
Visit to Paris (Sept. 1970), 122
Chileanization of copper companies,
Washingtons concern about Korrys
9, 10, 11
actions, 122
Church subcommittee hearings, 322,
WSAG meetings, 350, 361
324
Knowles, Lt. Gen. Richard T.:
CIA press comments on Viaux coup
Covert U.S. actions in Chile, 230, 295
attempt, 21
40 Committee meetings, 138, 179, 271
Confirmation of Chilean President:
Legislation on nationalization of
Congratulatory message for, 164
property, 202
Constraint from discussing politics
Political situation in Chile, Meyers
with Chileans, 48, 50, 51
briefing on, 178
Situation in Chile prior to, 65, 66, SRG meetings, 169, 206, 298
70 Korea, Democatic Peoples Republic of:
U.S. courses of action around: Applications of U.S. laws relating to
Chilean trade with, 183 Pessimism around, 68
References are to document numbers
339-370/428-S/80023
Index 979
Korry, Edward M.Continued Korry, Edward M.Continued
Confirmation of Chilean Covert U.S. actions in
PresidentContinued
ChileContinued
U.S. courses of action
U.S. funding of El Mercurio, 255
aroundContinued
Credit squeeze on Chile, 254
Secrecy as need around, 74, 80
DAO contacts with Chilean military,
Washingtons uncertainty about
118
Korrys actions:
Dissenting views on NIE 9469, 1
Communication failures
Economic situation in Chile, 1, 99,
between Korry and State
137, 214
Department, 117
Election of Allende analyzed by, 62
Johnson-Kissinger
Elections (Apr. 1971), 198, 219, 230
conversation about, 122
Elections (July 1971), 236
Kissingers call for more
Emigration from Chile, 121
supervision of Korry, 100
Enterprise visit to Chile, proposed,
Lack of U.S. channels to Frei,
209
112
Expected resignation of cabinet
Meyers call for Korry to pull
ministers, 102, 103, 105
back, 109, 111
40 Committee clearing of instructions
Vakys desire to rein in
to, 109
Korry, 76, 95, 98
40 Committee meetings, 117, 149
Copper plot, 219, 222
Haigs perspectives on, 119
Coup to prevent Allendes
Impossibility of parliamentary
presidency:
solution for avoiding Allende
Analysis of options for, 78
presidency, 108, 115 Economic pressure for provoking
of, 128 Inevitability of Allende as President,
Plans by lower-ranking officers for, 134, 141
126
ITTs activities in Chile, investigation
Possibility of, 71
of, 296
U.S. contacts with Chilean military
Kunakov Archives, 56, 59
on, 72, 118
Media attacks on, 59
U.S. corporate role in, 121
Meetings:
U.S. support of Frei and armed
With Allende, 211, 225, 260, 262
forces in case of, 112, 113, 140,
Departure call, 265
144
With Almeyda, 205, 250, 251, 252,
Covert U.S. actions in Chile:
260, 262
Continuation with Phase I, 44
With Claro, 15
Crimmins conversation on
With European Ambassadors, 69
elections funding, 28
With Figueroa, 108
Disassociation from rightist forces,
With Frei:
recommendation of, 144
Continuation of contacts with
Embassy as maintaining low
Ossa, 137
profile around, 116, 117
On Chilean military disallowal of
Expansion of, 37, 38, 39
Communist government, 18
Fourth option, 50, 55
On copper, 9, 15
Opposition to, 42
On elections, 4, 5, 6, 37, 61
Phase II, 44, 51, 58, 59
On political situation in Chile,
Presidential election, 1970, 28, 29,
27, 269
335
With Herrera, 135, 138
Proposal for election program
With Kissinger, 13, 245 funding, 3
With Lleras, 132 Secrecy as need around, 74, 80
Suspension of, 43 With Massad, 15, 121
References are to document numbers
339-370/428-S/80023
980 Index
Korry, Edward M.Continued Korry, Edward M.Continued
MeetingsContinued Replacement as Chilean ambassador
With Miranda, 145, 165 ofContinued
With Ossa: Kissinger-Korry phone
Sept. 11, 1970, 79, 80, 83, 85 conversation on, 192
Sept. 20, 1970, 108, 120 Korrys resentment over, 212, 222,
Oct. 6, 1970, 137, 142, 144 223
With Pablo, 79, 80, 81, 83 Rogers letter to Korry, 248
With Saez, 79, 80, 83, 132 Washington Post story on, 204
With Silva, 22 Retention as ambassador of, 16
With Tomic, 265 Rosenstein-Rodans interactions with,
Messages: 56, 75, 76, 132
From CIA, 63 Schneiders assassination, 161
From Johnson, 92, 117 SRG meetings, 150, 158
From Kissinger, 82, 83 Training programs under MAP, 65
Responses to seen as inadequate, UP as unstable coalition, 121
98, 117 U.S. financial non-support of PDC
To Almeyda, 250, 251 during Allende presidency, 131
To Almeyda from Rogers, 249, 251 U.S. military aid to Chile:
To CIA, 64 Continuation of in event of coup,
To 40 Committee, 85, 105 112, 113
To Frei, 23, 96, 98, 111, 112 Ossa talks on, 108
To Johnson, 96 Suspension of MAP training
To Johnson and Kissinger, 116 programs, 110, 140, 143
To Kissinger, 83, 102, 103, 108, 116 Viaux public statements, 101, 102
To Nixon, 221 Visit to Washington requested by,
To Ossa, 143 134, 137, 139, 146
To Valenzuela, 103 Withholding rather than
Miranda as go-between to Allende, termination of MAP deliveries,
145, 165 133
Naces visit to Chile, 226 Krauss, Enrique, 27
Nationalization of property: Krogh, Egil, 271
Anacondas proposal for special Kubisch, John B.:
envoy, 244, 245 Allende-Rogers meeting, 327, 331
As negotiator: Coup in Chile, 344, 354
Approval of, 211 Covert U.S. actions in Chile:
Chilean request for Korry role, Congressional questioning on, 352,
205, 206, 225 362
In Bethlehem Steel buy-out, 217 Funding for FY 1974, 337, 342
Korrys desire for, 208 Funding for private-sector
Proposals from, 263 organizations, 339, 343
Demarche on, 203, 204, 205 Reexamination of value of funding
Legislation on, 202, 205, 250 opposition forces, 329
Negotiation of commitments with Secret Lima meetings on
Allende, 159 rescheduling of Chilean debt, 331
Nixons perspectives on, 296, 335 U.S. communication with junta
Peterson Commission report, 221 leaders, 363
Political situation in Chile under Frei U.S. military aid to Chile, 365
administration, 25, 26, 27 WSAG meetings, 350, 361
Replacement as Chilean ambassador Kunakov Archives, 56, 59
of:
Allendes discussion of, 225 Labor issues. See Strikes, labor
Departure call on Allende, 265 Labor unions, U.S., 156
References are to document numbers
339-370/428-S/80023
Index 981
Lagos Matus, Gustavo D., 79 Less-developed countries (LDCs), 48,
Laird, Melvin R.: 137, 277
Allende government, 160, 165, 172, Letelier, Lt. Col. Ramon, 303
173, 175 Letelier del Solar, Orlando:
Communist bases in the Western Appointment as Chilean Ambassador
Hemisphere, 195 to the United States of, 187, 207
Covert U.S. actions in Chile, 278, 283 Boeing aircraft loan request, 228, 242,
Enterprise visit to Chile, proposed, 247, 284
209 Chilean media criticisms of, 252
NSC meetings, 173 Elections (Apr. 1971), 215
NSSM 97, 46 Meetings:
Lajara Burgos, Luis H., 23 Kissinger with Almeyda, 264
LAN-Chile (airline), 228, 232, 238, 242 Of Kissinger with Allende,
Land redistribution, 26 proposed, 314
Lang, William E., 53 Of Nixon with Allende, proposed,
Lanusse, Gen. Alejandro Augustin, 83, 314
183, 262, 304 Of Rogers with Allende, proposed,
Latimer, Thomas, 293 314, 327
Latin America: With Johnson, 252
Allende inauguration, 155, 164 With Kearns, 251
Covert operations in, 7 With Kissinger, 215, 242, 284
Guerrilla activities in, 174, 181, 184 With Nixon, 215
Military cooperation in, 170 With Rogers, 215
Nationalism in, 262 Nationalization of copper industry,
Rockefellers presidential mission to, 251
4, 23, 24 Navy command crisis, 345
Sensitivity to U.S. big stick of, 13 Rescheduling of Chilean debt, 284,
U.S. courses of action in, 170 331
U.S. investment guarantees in, 137, Levingston, Roberto M., 170
194 Lincoln, George A., 173, 175, 197
U.S. military aid to, 170 Linowitz, Sol, 83, 131, 158
U.S. policy in, 27 Lleras Restrepo, Carlos A.:
Le May Delano, Capt. Carlos, 89 Frei compared with, 65
Leddy, Raymond G.: Meetings:
40 Committee meetings, 149 With Frei, 132, 135, 142, 157
SRG meetings: With Korry, 132
Oct. 14, 1970, 150 With Saez, 142
Oct. 17, 1970, 158 Lockheed, 183
Oct. 29, 1970, 169 Lodge, John Davis, 209
Dec. 7, 1970, 187 Loefke, Lt. Col. Bernard, 233
Dec. 23, 1970, 194 Lord, Winston, 54, 87
Feb. 17, 1971, 206 Lorenzini, Emilio, 79
Sept. 9, 1971, 257 Los Angeles Times, 65
Apr. 11, 1972, 298 Luisi, Hector, 183
Leigh Guzman, Gustavo, 350 Lynn, Laurence, 293
Leighton Guzman, Bernardo:
As Frei emissary to Alessandri, 89 MacArthur, Gen. Douglas, 25
As PDC negotiation committee Maira, Luis, 68, 137, 323
member for UP talks, 137 Major Item Material Excess (MIMEX),
As potential candidate in 279
Congressional confirmation, 65, Mao Tse Tung, 165
68 Maoists, 150
PDC truce with Allende, proposed, MAPEX, 279
307 Marambio, Gen. Tulio M., 18, 19
References are to document numbers
339-370/428-S/80023
982 Index
March of the Empty Pots, 276 Medici, Em lio G., 170, 186
Mardones, Carlos, 251 El Mercurio:
Mar n Soc as, Oscar, 236 As barrier to Allendes strategies, 255,
Masaryk, Jan, 96, 99 259
Massad Abud, Carlos, 12, 15, 68, 121 As main non-leftist media, 62
Mather, Gen. George R., 110 As resistant to government pressure,
Matte, Benjamin, 303 203
Matus Romo, Carlos T., 251 Banging of pots demonstrations, 303
McAfee, William: Covert U.S. funding for, 255, 258, 259,
Coup in Chile, 344, 354 290, 295
Covert U.S. actions in Chile: Debt of, 97, 120, 290
Congressional questioning on, 362 Edwards as owner of, 62, 271, 290,
Funding for FY 1974, 337 295
Funding for Mar. 1973 elections, FNCB loans to, 97, 120, 290
319, 325 Immigration to Australia, 25
Funding for private-sector Kunakov Archives, 56
organizations, 308 Leaking of owners passport
Reexamination of value of funding application, 79
opposition forces, 329 Leftist pressures on, 97, 99
40 Committee meetings, 70, 92, 138 NY Times interview of Allende
U.S. funding of El Mercurio, 290 published by, 142
McAlister, Brig. Gen. Robert C., 183, USIA use of editorials of, 101
187, 207 Merino Castro, Adm. Jose T., 345, 360
McCloy, John J., 244 Mexico:
McCone, John A., 82, 88, 90, 322 Allendes visit to, 315
McGee, Gale W., 352 Cuba, relations with, 183, 187
McGinnis, John J., 233 Regret at coup in Chile, 348, 353
McNamara, Robert, 183, 248, 256 U.S. consultation against Allende
Meany, George, 181 government with, 134
Meat, 134, 181 U.S. consultations on public posture
Media: to Allende government, 155
Chilean: Meyer, Charles A.:
Accusations of U.S. involvement in Allende government, 155, 183, 257
Schneider assassination, 225 Allende inauguration, 155, 159, 160,
Anti-American charges on, 163, 165 178, 179
ITT memoranda, 294 Anacondas request for U.S. funding
Letelier as criticized by, 252 for Alessandri campaign, 32, 33,
El Mercurios role in, 62 36
PDC purchases of, 188, 200 As chair of Ad Hoc Working Group
PN purchases of, 188, 200 on Chile, 181
Sitting ducks in, 166 As disapproving of Korrys actions,
Under a Marxist Regime (CIA 109, 111
memorandum), 191 Boeing aircraft loan request, 228
Latin American, 166 Church subcommittee hearings, 322,
U.S.: 324
Allende government, reaction in, CIA press comments on Viaux coup
171 attempt, 23
Broadcast comparisons of Chile Confirmation of Chilean president,
with Cuba, 165 51, 58, 59, 60, 169
Chilean charges of reporting bias, Coup in Chile, 70, 312, 313
264 Covert U.S. actions in Chile:
Leaking of reports on Chile to, 174 Funding for Chilean elections:
Planting questions at press Continuation with Phase I, 44
conferences, 183 Fourth option, 52
References are to document numbers
339-370/428-S/80023
Index 983
Meyer, Charles A.Continued Meyer, Charles A.Continued
Covert U.S. actions in SRG meetingsContinued
ChileContinued Oct. 17, 1970, 158
Funding for Chilean Oct. 29, 1970, 169
electionsContinued Nov. 19, 1970, 183
Opposition to expansion of, 41, Dec. 7, 1970, 186, 187
42 June 3, 1971, 233
Phase II, 51, 58, 59, 60 Sept. 9, 1971, 257
Funding for private-sector Suspension of MAP training
organizations, 305, 308 programs, 108, 110
U.S. funding of El Mercurio, 258 Visit to Chile (Nov. 1970), 178
U.S. funding of opposition political Meyer, Cord, Jr., 94, 309
parties, 270, 317 Michaelson, Charles D., 239
Washingtons concern about Military Assistance Advisory Group
Korrys actions, 122 (MAAG), 183, 186
Cuban participation in OAS, 187 Military Assistance Program (MAP) (see
Fords operations in Chile, 128 also Armed forces of Chile; United
40 Committee meetings: States military aid to Chile):
Sept. 8, 1970, 70 CIA views on, 138
Sept. 14, 1970, 92 Continuation of without MAAG, 183
Sept. 29, 1970, 127 Delivery of already-contracted
Oct. 6, 1970, 138 materiel, 148, 150
Oct. 14, 1970, 149 Reductions in, 120
Nov. 13, 1970, 179 Termination in FY 1968 of grant
Nov. 19, 1970, 184 materiel program, 127
Dec. 7, 1970, 188 Training programs:
July 6, 1971, 237 Korry-Ossa discussion of, 108
Sept. 9, 1971, 258 Restoration of, request for, 65
Impossibility of parliamentary Suspension of, 110, 111, 138, 140,
solution for avoiding Allende 143
presidency, 115 U.S. aid to Brazil and Argentina
Inevitability of Allende as President, under, 156
148 Withholding rather than
JCS representation at Ad Hoc termination of deliveries
Interagency Working Group on under, 133
Chile, 183 Military Mission Agreement
Meetings: (U.S.-Chile) (1964), 156, 182
With Alessandri, 178 Military procurement, 349
With Allende, 178, 179 Miller, Robert H.:
With Chilean leaders, 178, 179 Bilateral talks on rescheduling of
With Frei, 178, 269 Chilean debt, 318
With Kissinger, 13 Church subcommittee hearings, 322
With Krauss, 27 Election (Mar. 1973), 321
With Ossa, 178, 179 Nationalization of copper industry,
Naces visit to Chile, 226 250, 254
Nationalization of property, 202, 211, Truckers strike, 311
250, 254, 274 Milliken, Frank, 239
NSDM 93, 181 Mills, Bradford, 206, 217, 231
NSSM 97, 53, 127 Miranda Ramirez, Hugo:
Political situation in Chile, 178 As Allende supporter, 81
Rescheduling of Chilean debt, 286, As Korry go-between from Allende,
316, 318, 320 145, 165
SRG meetings: Compensation for nationalized
Oct. 14, 1970, 150 properties, 323
References are to document numbers
339-370/428-S/80023
984 Index
Miranda Ramirez, HugoContinued Moorer, Adm. Thomas H.Continued
Frei meetings with, 5 40 Committee meetingsContinued
Missile crisis (1962), 158 Oct. 14, 1970, 149
Mitchell, John N.: Nov. 13, 1970, 179
Counterfeit currency/narcotics Nov. 19, 1970, 184
trafficking by Allende Dec. 7, 1970, 188
government, 177 Jan. 28, 1971, 201
Coup to prevent Allendes July 6, 1971, 237
Presidency, 105 Sept. 9, 1971, 258
Covert U.S. actions in Chile, 201, 213, Nov. 5, 1971, 271
230, 258, 259, 278 JCS representation at Ad Hoc
40 Committee meetings: Interagency Working Group on
Mar. 25, 1970, 31 Chile, 183
June 27, 1970, 41 NSSM 97, 46, 53
Aug. 7, 1970, 49 Rescheduling of Chilean debt, 286
Sept. 8, 1970, 70 Soviet military bases in Chile,
Sept. 14, 1970, 92 possible, 91, 195
Sept. 29, 1970, 127 SRG meetings:
Oct. 6, 1970, 138 Oct. 14, 1970, 150
Oct. 14, 1970, 149 Oct. 17, 1970, 158
Nov. 13, 1970, 179 Nov. 19, 1970, 183
Nov. 19, 1970, 184 Dec. 7, 1970, 187
Dec. 7, 1970, 188 Dec. 23, 1970, 194
Jan. 28, 1971, 201 Feb. 25, 1971, 210
July 6, 1971, 237 June 3, 1971, 233
Sept. 9, 1971, 258 Sept. 9, 1971, 257
Nov. 5, 1971, 271 U.S. policy toward Allende
Korrys request for visit to government, 173, 175
Washington, 139 WSAG meetings, 353
Meetings: Morales, Raul, 3, 198
With Edwards, 89 Moreno, Rafael, 165
With Nixon, 93 Morocco, 327
NSC meetings, 173 Movimiento de Intransigencia y
SRG meetings, 150, 183, 206, 257 Renovacion (MIR) (Argentina), 150
303 Committee meetings, 7 Movimiento de Izquierda
Mitrione, Dan, 51 Revolucionaria (MIR):
Moai, 26 As Allendes personal bodyguard,
Monetary liquidity, 68 203
Montero, Adm. Raul, 207, 210, 345 As quiet during election period, 62
Moorer, Adm. Thomas H.: Banning by junta of, 349
Consultations with Brazil and Communist clashes with, 190
Argentina, 182 Concepcion demonstrations by, 302,
Coup to prevent Allendes 303
Presidency, 105 Guerrilla warfare as possible
Covert U.S. actions in Chile, 213, 258 response to coup, 313
Enterprise visit to Chile, proposed, Landlords reoccupation of farms of,
209 291
40 Committee meetings: Seizure of vegetable farms by, 330
June 27, 1970, 41 Suppression of, 157
Aug. 7, 1970, 49 Multinational corporations, 322
Sept. 8, 1970, 70 Murphy, C. Gordon, 206
Sept. 14, 1970, 92 Murphy, Robert, 244
Sept. 19, 1970, 104 Mutual Defense Assistance Agreement
Sept. 22, 1970, 111, 112 (U.S.-Chile) (1952), 156, 182
References are to document numbers
339-370/428-S/80023
Index 985
Nace, Rear Adm. Charles Derick, 226 Nachmanoff, ArnoldContinued
Naces visit to Chile, 226 Nachmanoff, Arnold:
Nationalization of property:
Allende government:
Anaconda proposal on, 245
Currency counterfeiting by, 177
Implications of U.S. confrontation
Funding for political opposition to,
over, 273
200, 224
Korry as negotiator in, 208, 211
Narco-trafficking by, 177, 193
Legislation on, 202
Post-inauguration analysis, 180
Special envoy on nationalization,
Allendes interests and objectives, 208
256, 257
Anaconda executive meeting with
NSC meetings, 173
Kissinger and, 245, 248
Political situation in Chile, 178, 190
Bethlehem Steel buy-out agreement,
Rescheduling of Chilean debt, 280
217
SRG meetings:
Boeing aircraft loan request:
Oct. 14, 1970, 150
Chilean position, 228, 242, 284
Oct. 17, 1970, 158
Discussions of, 232
Nov. 19, 1970, 182, 183
Letelier phone conversation on, 247
Dec. 7, 1970, 186, 187
Review of decisions on, 238
Dec. 23, 1970, 194
Copper plot, 222, 243
Feb. 17, 1971, 205, 206
Covert U.S. actions in Chile:
Feb. 25, 1971, 210
Funding for political opposition to
June 3, 1971, 232, 233
Allende government, 200, 224
Sept. 9, 1971, 256, 257
Funding for political parties, 230
Narcotics smuggling, 177, 193
Need for immediacy in National Advisory Council (NAC), 282,
implementation of, 283 286
National Aeronautics and Space U.S. funding of El Mercurio, 255
Administration (NASA): Elections (Apr. 1971), 198, 227
Chilean operations of, 130, 147
Emerging Chilean economic
Continuation of station, 155, 194
problems, CIA report on, 246
University of Chile connections with,
Enterprise visit to Chile, proposed,
165
209
National Intelligence Estimates:
Export-Import Bank operations in
NIE 9469, 1, 2
Chile, 199
NIE 9470, 47
40 Committee meetings:
NIE 9472, 302
Nov. 13, 1970, 179
NIE 9473, 336
Nov. 19, 1970, 184
National Labor Federation (CUT), 302
Dec. 7, 1970, 188
National Science Foundation Antarctic
Jan. 28, 1971, 201
Research Program, 61
July 6, 1971, 237
National Security Agency (NSA), 1, 47
Sept. 8, 1971, 255
National Security Council (NSC):
Nov. 5, 1971, 270, 271
CIA paper on covert options for
IDB loans to Chilean universities, 194
Chile, 166
Korrys replacement as ambassador,
Covert U.S. Funding for political
204, 223
parties, 317
Meetings:
Meetings:
Of Frei with Meyer, 269
Nov. 6, 1970, 158, 159, 171, 172, 173
Of Jarpa with Kissinger, 189
On NSSM 97, 138
Of Kissinger with Almeyda, 263,
Memoranda for 40 Committee, 106
264
Post-election coup, prospects for, 66
Of Korry with Allende, 225 Post-election situation in Chile, 65
Of Letelier with Kissinger, 215 National Security Decision Memoranda:
With Iban ez, 119 NSDM 93:
With Ossa, 272 Adoption of, 175
References are to document numbers
339-370/428-S/80023
986 Index
National Security Decision Nationalization of property (see also
MemorandaContinued Anaconda Copper Mining
NSDM 93Continued Company; Congress, Chile, Acts of;
Chilean debt rescheduling Kennecott Copper
agreement as concurring with,
Company)Continued
296, 328
Compensation forContinued
Implementation of, 176, 181, 183,
U.S. policy on, 274
281
Copper industry:
National Security Study Memoranda:
Amendment for:
NSSM 97:
Chilean desire for, 190, 194
Critical questions in, 48
Deadline for, 139
Focus of, 51
Modification of, 216
Fourth option, 50, 52
Timing for, 215
NSC meetings on, 138
U.S. initiative to influence, 155,
Options of, 52, 127, 131, 156
205
Post-election consideration of, 66
Anaconda executives view on, 12
Special Review Group discussions
Anacondas litigation outside
of, 53
Chile, 265, 284, 285
SRG meeting on, 130, 147, 149
Anacondas proposal, 245
Text of, 46
Anacondas request for Presidential
NSSM 108, 187
statement on, 204
NSSM 131, 238
Chilean political parties support
National Society of Farmers, 303
for, 12
Nationalism, 73, 79, 262
Communist Party role in, 265
Nationalization of property (see also
El Teniente mine, 8, 239, 284, 285
Anaconda Copper Mining
Excess profits as issue in, 260
Company; Congress, Chile, Acts of;
Freis position on, 1, 15
Kennecott Copper Company):
Implications of U.S. confrontation
Appointment of special envoy:
over, 273
Proposal for, 244, 245, 248
Kennecotts legal actions against
SRG consideration of, 253, 256, 257
Chile, 318
Assessment of value as enacted in
Korry as negotiator:
copper bill, 250
Approval of, 211
Bethlehem Steel:
Chilean governments request
As pressured to sell, 203
for, 205, 206, 225
CAP as purchaser of, 206, 216, 217
In Bethlehem Steel buy-out, 217
Korry as negotiator, 217
Korrys desire for, 208
Negotiations with Chilean
Proposals from, 263
government, 205, 206, 208
Links to IPC expropriation, 8, 9, 13,
Signing of buy-out agreement, 216,
17
217
Negotiations for, 221, 250
Cerro de Pascua negotiations:
Prospects for, 8
Lack of agreement in, 242
Rogers note to Almeyda on, 249,
Progress in, 225, 231, 327
250, 251, 252, 262
Resolution in, 247, 265, 336
Special Copper Tribunal, 302, 314,
U.S.-Chilean differences over, 251
316
Chilean banks, 203
Tomics position on, 5
Chileanization as, 215
U.S. negotiating strategies, 240
CODELCO role in assessment of
Expropriation guarantee coverage, 11, value, 250
17, 137, 175, 194 Compensation for:
Foreign investment in LDCs as Chilean position, 262, 265, 323
Rogers statement on, 266, 267, 281 affected by, 137
References are to document numbers
339-370/428-S/80023
Index 987
Nationalization of property (see also New York TimesContinued
Anaconda Copper Mining Allende interview, 142
Company; Congress, Chile, Acts of; Chiles Winning Coalition:
Kennecott Copper Communist-Backed Group of
Company)Continued Radicals and Catholic Leftists
International support for opposition Provided Plurality, 68
to, seeking of, 277 Envoy Says He Controls U.S. Navy
ITT: Visits to Chile, 65
Legislation to enable seizure of, Meyers speech to Council for Latin
296, 299 America, 11
Resumption of talks on, 265, 279, U.S. Navys Visa Requests Worry
281 Chile, 61, 65
Unlikelihood of compensation for, Newsom, David D., 49
353 NGouabi, Marien, 170
U.S. position, 254, 279, 281 Nguyen Cao Ky, 87, 122
Korrys demarche on, 203, 204, 205 Nguyen Van Thieu, 87, 122
Legislation for: NIBSA, 208
As sought for, 190, 194 Nicaragua, 187, 360
Deadline for, 139 Nixon, Richard M.:
Demarche to Almeyda on, 204 Allende government:
Korry in negotiator role, 211 Consolidation of power by, 203
Modification of, 216 Post-inauguration analysis, 180
Payment for expropriated property, Strengthening of opposition to, 203
250 U.S. operational issues before start
PDC role in, 265 of, 159, 160
Timing for, 215 U.S. policy toward, 172, 173, 175
U.S. initiative to influence, 155, 205 Allendes election, analysis of, 62
U.S. position, 202 Allendes meeting with Latin
NIBSA, 208 American revolutionaries (Nov.
Oil industry, 277 1970), 174
OPIC as affected by, 137, 205, 206 Anaconda Copper agreement with
OPIC payments to corporations for, Chile, 17
257, 261 Application of Hickenlooper
Ralston-Purina, 208, 242 Amendment, possibility of, 153
Strategy questioned by Allende, As viewed by Frei, 4
possibility of, 279 Boeing aircraft loan request, 234, 235,
Suspension of aid without agreement 238
for adequate compensation in British support for Allende, 117
case of, 156 Chileanization of copper industry, 9,
Suspension of debt repayments, 284, 13, 14
285 Church subcommittee hearings, 324
U.S-Chile relations as dominated by, Compensation for nationalized
241 properties, 266, 267
U.S. courses of actions in case of, 158 Confirmation of Chilean President:
U.S. credit squeeze in response to, Congratulatory message for, 159,
254 160, 169
U.S. policy options for, 183, 279 Freis actions to influence, 81
Navy, U.S., 61, 65 Talks with Kissinger on, 82
Nelson, William, 138, 271, 361 Copper price drops effect on Chile,
Neruda, Pablo, 25, 65 197
Netherlands, 277 Coup in Chile:
New York Times: By Souper, 334, 335
Accusations by Chilean leftists By Viaux, 20, 153
against, 98 Death of Allende, 348
References are to document numbers
339-370/428-S/80023
988 Index
Nixon, Richard M.Continued Nixon, Richard M.Continued
Coup in ChileContinued Rescheduling of Chilean
Initiation of, 346 debtContinued
Kissinger talks on, 352, 357 Multilateral talks in Paris for, 287,
Covert U.S. actions in Chile: 294
Approval by, 93, 94 Speeches:
CIA plan for implementation of, 54 October 31, 1970, 35
Funding for private-sector State of the Union (1969), 15
organizations, 339 United Nations (1970), 165
U.S. funding of El Mercurio, 258, Staffing of news media, 62
259 U.S. courses of action in Latin
Economic vulnerabilities in Chile, America, 170
CIA report on, 214 U.S.-Cuban relations, 187
Election (1964), 335 U.S. economic and military aid
Election (Apr. 1971), 216, 218, 220 cut-off, 111
Election (Jan. 1972), 289 Nixon Doctrine, 169, 33
Enterprise visit to Chile, proposed, Nolff, Max, 161
209, 210, 216 North Atlantic Treaty Organization
Foreign Military Sales, 233, 235 (NATO), 167
40 Committee decisions, 100 Novak, Robert, 174
FUBELT, 94 Novitski, Joseph, 131
Funeral of Allende, 250 Noyes, James S., 210
IDB loans to Chilean universities, NSF radio astronomy project, 187
194, 196, 203 Nutter, G. Warren:
Korry as seen by, 296, 335 Allende government as lowering U.S.
Korrys replacement as ambassador, worldwide prestige, 156
192, 222, 223 40 Committee meetings, 149, 179
Latin American policies of, 27 MAP materiel program termination,
Meetings: 127
Of Pinochet with Urrutia, 355 Political situation in Chile, 178
With Allende, proposed, 314, 323 Rescheduling of Chilean debt, 274,
With Kissinger, 82, 93 275, 286
With Letelier, 215 SRG meetings, 150, 158, 183, 206, 233,
With Mitchell and Kissinger, 93 257, 298
Messages:
From Frei, 9, 10, 11, 13, 17, 83 Oil industry, 8, 121, 135, 277
From Kissinger, 84 Okinawa, 327
From Korry, 221 Onis, Juan de, 68
From Korry to Kissinger, 83 Organization of American States (OAS):
To Frei, 14, 15, 63, 86 Caracas Resolution (No. 93) (1954),
Nationalization of property: 195
Expropriation of ITT assets, 299 Chilean civil war, response to, 106
Legislation for, 202, 216 Chilean participation in, 183, 187
Special envoy on, 244, 253 Chilean violations of charter and
Negotiation of commitments with resolutions of, 156
Allende, 159, 160 Chilean withdrawal from, 47
NSC meetings, 173 Cuban participation in, 187, 353
NSDM 93, 175, 176 Cuban sanctions resolution, 181, 182,
NSSM 97, 46 187, 195
Pinochet junta, 351, 355 Education-Scientific Council, 79
Political situation in Chile, 190 General Assembly meeting
Rescheduling of Chilean debt: (Washington, Apr. 1972), 294
Agreement on, 297, 299 Human Rights Commission, 361
Decision on, 288 Punta del Este Resolution (1962), 195
References are to document numbers
339-370/428-S/80023
Index 989
Organization of American States Pablo, TomasContinued
(OAS)Continued As president upon Frei resignation,
Revitalization of, 187
85
U.S. actions against Allende
Election of Alessandri by Congress,
government in, 134
possible, 50
Ortiz Mena, Antonio, 187, 194, 248
Visit with Korry, 79, 80, 81, 83
Ossa Pretot, Sergio:
Pablo Pardo, Luis Maria de, 134
Convincing Frei to take action, 132,
Pace, Frank, 170
142
Pacheco Gomez, Maximo, 79
Coup to prevent Allendes
Pacific Steel Company (CAP):
Presidency, 105
Bethlehem Steel as purchased by, 206,
Delivery of Korrys message to Frei
216, 217
by, 96, 98, 112
Export-Import Bank loan requests
Impossibility of parliamentary
from, 199
solution for preventing Allende
Reduction in orders to, 135
presidency, 108
Packard, David:
Meetings:
Allende government as lowering U.S.
With generals and admirals, 142
worldwide prestige, 156
With Korry:
Coup in Chile, 70, 105
Sept. 11, 1970, 79, 80, 83, 85
Covert U.S. actions in Chile:
Sept. 20, 1970, 108, 120
Financial support for Jan. 1972
Oct. 6, 1970, 137, 142, 144
by-elections, 278
With Meyer, 178, 179
Funding for political opposition to
With Nachmanoff, 272
Allende government, 201, 213 Messages from Korry, 143
Funding for political parties, 230 PDC purchase of Chilean media, 200
Suspension of MAP training Need for immediacy in
programs, 108, 110, 143 implementation of, 283
U.S. financial non-support of PDC
New opportunities for, 283
during Allende presidency, 131
U.S. funding of El Mercurio, 258
U.S. military aid cut-off, 120
Enterprise visit to Chile, proposed,
Viaux public statements, 101, 102
209, 210
Ovando Cand a, Gen. Alfredo, 26
40 Committee meetings:
Overseas Private Investment
Mar. 25, 1970, 31
Corporation (OPIC):
June 27, 1970, 41
Amount of coverage for losses from
Aug. 7, 1970, 49
nationalization, 257, 261
Sept. 8, 1970, 70
Anacondas litigation outside Chile,
Sept. 14, 1970, 92
265
Sept. 19, 1970, 104
Bethlehem Steel buy-out, 205, 216,
Sept. 22, 1970, 111, 112
217
Sept. 29, 1970, 127
Braden notes, 284, 285
Oct. 6, 1970, 138
Church subcommittee hearings, 322
Oct. 14, 1970, 149
Copper nationalization, 205, 206
Nov. 13, 1970, 179
Effect of large-scale nationalizations
Nov. 19, 1970, 184
on, 137, 205, 206
Dec. 7, 1970, 188
ITT indemnification from, 299, 322
Jan. 28, 1971, 201
Kennecott Copper claim, 239, 261
July 6, 1971, 237
Mills-Allende talks, 231
Sept. 9, 1971, 258
Payments to corporations in Chile,
Nov. 5, 1971, 271
247, 261
MAP grant materiel programs Rescheduling of Chilean debt, 275
termination in FY 1968, 127
Naces visit to Chile, 226 Pablo, Tomas:
Access to secret documents by, 142 NSSM 97, 53
References are to document numbers
339-370/428-S/80023
990 Index
Packard, DavidContinued Perez Zujovic, EdmundoContinued
Study of constitutional overthrow of Soviet military bases in Chile,
election results, 65 possible, 91
U.S. military intervention in Chile, SRG meetings:
possibility of, 48
Oct. 14, 1970, 150
Peron, Juan D., 26, 353
Oct. 17, 1970, 150, 158
Peru:
Oct. 29, 1970, 169
Allende election, opposition to, 90,
Nov. 19, 1970, 183
104
Dec. 7, 1970, 187
As Andean Pact member, 327
Feb. 17, 1971, 206
Chile, relations with, 6, 189, 360
Feb. 25, 1971, 210
Copper price drops effect on, 197
303 Committee meetings, 7
Export-Import Bank credits for, 232
Palma, Eduardo, 23
Government as leftist in, 195
Palma Wormald, Maj. Ricardo S., 136
Invasion of Chile, possible, 89
PAMEX, 279
IPC expropriation by:
Panama, 133, 138
CECLA meeting and, 4
Panama Canal, 156, 167
Chilean copper nationalization
Paraguay, 18, 156
links to, 8, 9, 13, 17
Paratroop equipment, 232, 235
Hickenlooper Amendment not
Paredes, Rene, 162
applied for, 169, 267
Paris Club:
U.S. avoidance of confrontation
Agreement on Chilean debt
over, 158
rescheduling, 296, 297, 298, 299,
U.S.-Peruvian exchange of notes
331
over, 194
Bilateral talks following, 316
Political situation in, 2
Description of, 294
Radical activities in, 150
Direct negotiations on debt, 328
U.S. consultations on public posture
Disagreements at, possible, 298
to Allende government, 155
Meetings:
U.S. disaster aid to, 327
Dec. 1971, 279
U.S. military aid to Chile, 232
Jan. 1972, 282, 286
Peterson, Peter G., 235, 322, 327
July 1973, 328
Peterson Commission, 192, 221
Memorandum of Understanding, 294,
Petty, John R., 233, 274, 275, 277
302, 314, 320
Phase I. See Presidential election in
Second session, 294, 297
Chile (Sept. 1970)
Statement of, 298
Phase II (see also Confirmation of
Parkinson, Jay, 12, 32, 33, 36
Chilean President):
Peace Corps:
CIA plan for implementation of, 54,
Chilean request for Allende
58
governments confirmation of,
40 Committee decisions on, 53, 54
181, 182, 183, 186
Freis role in, 55
Question of remaining in Chile, 147,
Postponement of, 44, 51
155
Status report on, 57
Retention in Chile of, 121, 167
Philippines, 197
Peet, Vice Adm. Raymond, 350, 353, 361
Phillips, David A.:
Perez Zujovic, Edmundo:
Coup in Chile, 341, 354
As potential candidate in
Covert U.S. actions in Chile, 342, 362,
Congressional confirmation, 65, 366
68 FUBELT, 94, 107
Murder of, 238, 251 WSAG meetings, 350, 353, 361
PDC vote against Allende, 123 Phillips, Patricio, 12, 303
Removal of, 5 Philpott, Jamie M., 151
Seen as loose-lipped, 4, 120 Pickering, Thomas R., 341
References are to document numbers
339-370/428-S/80023
Index 991
Pin era Carvallo, Jose, 120 Political partiesContinued
Pinochet junta: As supporting the military junta, 351
Attack on Cuban ship and embassy, Banning by Pinochet junta of leftist
350, 353 parties, 349, 355
Banning of leftist parties by, 349 Christian Democatic (COPEI)
Brazilian aid to, possible, 313, 350 (Venezuela), 101
Breaking of relations with Christian Democatic (PDC) (Chile):
Communist countries, 349, 354, As accommodating the left, 62
355 As counter to leftists, 40
Chileans requesting political asylum As divided, 178, 179
from, 361 As indecisive, 341
Initiation of coup, 346 As source of opposition to Allende,
Japanese aid to, possible, 313 184
Japanese recognition of, 350 Chileanization of copper
Pinochet meeting with U.S. Military companies, 15, 17
Group officer, 349 CIA press comments on Viaux
Political parties supporting, 351 coup attempt, 23
Repression of dissent by, 365 CIA views on, 55
Rescheduling of debt by, 355 Conservative disagreement with,
Success of coup by, 347, 349 178
Swearing in of, 351 Covert U.S. funding for:
U.S.-Brazilian talks on, 350 Additional funds for, 201, 213
U.S. communication with leaders of, Election (Mar 1973), 270, 271, 319
348, 353, 361, 363 For anti-Allende faction in, 137,
U.S. economic aid to Chile, 350, 353, 230
361, 364 For FY 1974, 337, 340
U.S. military aid to Chile, 365 For opposition to plebiscite, 270,
U.S. recognition of: 271, 272
Announcement of, 365 Media purchases, 188, 200
Chilean position, 349, 360 Organization improvements
Instructions for Ambassador on, resulting from, 325, 339
358, 361 Requests for, 213, 224, 230
Mexican position, 359 Decision not to impede Allendes
Timing for, 348, 350, 353, 361, 364 inauguration by, 135, 138
Visit of U.S. Air Force Thunderbirds, Dissident legislators meeting with
350 Embassy Political Counselor,
Western European aid to, possible, 301
313 Eight-point assurances requested of
Pinochet Ugarte, Gen. Augusto (see also Allende, 131, 134
Pinochet junta): Elections (Mar. 1969), 17
Coup in Chile lacking support, 341 Elections (Apr. 1971), 213, 216, 218,
Meeting with Davis, 363 219, 220
Meetings with Urrutia, 349, 355 Senate by-election, 198, 213
Swearing in as President, 351 Elections (July 1971), 236, 237, 241
P.L. 480, 84, 187, 194 Elections (Jan. 1972), 289
Place, John, 248 Elections (Mar. 1973), 270, 271, 319
Plaza Lasso, Galo, 81, 83, 98, 187 Electoral process negotiating team
Poblete Garces, Gen. Sergio, 142 of, 68
Point Four Program of Technical Grassroots vs. intellectuals in, 135
Assistance, 231 Increase in aggressive actions on,
Political asylum, 361 276
Political parties: Increased effectiveness under
Alianza Popular Revolucionaria Allende government of, 203
Americana (APRA) (Peru), 26 Leaders support of Allende, 98
References are to document numbers
339-370/428-S/80023
992 Index
Political partiesContinued Political partiesContinued
Communist (PCCh) Christian Democatic (PDC)
(Chile)Continued (Chile)Continued
Socialist differences with, 189, 190, Mar n as supported by, 236
269, 302
Media purchases by, 188
Soviet invasion of Czechoslovakia
National council meetings, 73, 178
(1968), support by, 150
National Party cooperation with,
Support for copper nationalization
276
in, 12
Platform meeting of, 8
Suppression of MIR as desired by,
PNs differences with, 189, 200
157
Post-election revitalization of, 190
U.S. desire for isolation of, 28
Reformist faction in, 1
U.S. perspectives on, 150
Rejuvenation of opposition to
Use of force for imposition of
Allende election, 77
socialism, 289
Sale of publishing house to
Democatic (U.S.), 212
government, 216
Democatic Radical (PDR) (Chile):
Schneider assassination role of, 216
Collapse of, 184
Split in opposition to Allende by,
Covert U.S. electoral aid for 1970,
134
28, 29, 35
Support for copper nationalization
Covert U.S. funding for, 200, 270,
in, 12
271
Talks with UP, 137, 141
Elections (Apr. 1971), 213, 219, 220
Truce with Allende, proposed, 307
Formation of, 29
Two political tendencies within, 73
Mar n as supported by, 236
U.S. approach to dealing with, 133
Fundraising in Western Europe by,
U.S. financial non-support during
271
Allende presidency of, 131
Impeachment of Allende, possible,
Vote against Allende, 123
345
Women Against Allende
Independent Radical Movement of
(organization), 157
the Left (MRII), 270, 271
Communist (Czechoslovakia), 131
National (PN) (Chile):
Communist (PCCh) (Chile):
Allendes repudiation of, 330
Alessandris potential cooperation
As source of opposition to Allende,
with, 37
184
Argentina as accused by, 168
As well-organized, 62
As most powerful in the Western
Covert U.S. funding for:
Hemisphere, 8
CIA report on, 325, 337, 340
As possible coalition member, 1
40 Committee approval of, 200,
As pro-Soviet, 150
201, 270, 271
Banning by junta of, 349, 355
Criticism of copper agreement by,
Candidates in Presidential
8
campaign (1970) as seen by, 26
Election (Jan. 1972), 289
CIA as accused by, 168
Election (Mar. 1973), 319
CIA views on, 55
Elections (Apr. 1971), 198, 218, 220
Copper nationalization role of, 265
Electoral prospects of, 3, 29
Covert U.S. funding of elections as
Frei seen as enemy of, 200
seen by, 37
Mar n as supported by, 236
Elections (Apr. 1971), 218, 220 Media purchases by, 188
Fear in Chile of, 86 PDC cooperation with, 276
Freis views on, 81 PDCs differences with, 189, 200
MIR clashes with, 190 Support for Congressional
Outlawing of, 309 confirmation of Allende, 141,
Radicalizing of, 330 144, 161
References are to document numbers
339-370/428-S/80023
Index 993
Political partiesContinued Political partiesContinued
Socialist (Chile)Continued National (PN) (Chile)Continued
Use of force for imposition of Support for copper nationalization
socialism, 289 in, 12
United Popular Action Movement
Patria y Libertad (Chile), 144
(MAPU) (Chile), 29, 189, 349
Popular Front (FRAP) (Chile), 3, 18,
Political situation in Chile:
29
At the two-year mark of the Allende
Popular Socialist Union (USP) (Chile),
government, 302
3
Davis initial assessment on, 276
Popular Unity (UP):
During Frei administration, 25, 26, 27
Anti-American charges by, 163, 165
Helms, Kendall, Edwards discussion
As effective campaigners, 38
of, 89
As seen by Tomic, 269
In immediate post-election period, 65,
As unstable coalition, 121
99, 190
Consolidation of power in
Long-term perspectives on, 40
post-election period, 79, 81, 85
Meyers briefing on, 178
Covert funding to foster dissention
NIE on outlook for, 47
within, 29, 270
Polarization between left and right,
Declining levels of support for, 270
47
Elections (Apr. 1971), 216, 218, 220,
Polls, election:
289
Gains for Allende in, 37, 38, 41
Intimidation of pot bangers by, 303
Inaccuracy of, 36, 62
Talks with PDC, 137, 141
Increases for Alessandri in, 45
U.S. opposition to, 28, 29, 31
Need for confirmation by Congress
Valdes view of, 98
shown by, 53
Radical (PR) (Chile):
Porta Angulo, Adm. Fernando:
As possible coalition member, 1
As indecisive and cautious, 89
CIA views on, 55
Coup prospects, 6
National Executive Committee
Generals meeting in response to
(CEN), 3
Allendes win, 67
Resignation of ministers from
Opposition to Allende as president,
Allende government, 290
50
Schisms in, 29, 35, 37
Relieving of command of, 152
Support for copper nationalization
Suspension of MAP training
in, 12
programs, 108
Use of force for imposition of
Porter, William:
socialism, 289
Covert U.S. actions in Chile, 319, 325,
Radical Left (PIR), 291
329, 337
Social Democrats (PSD) (Chile), 351
U.S. communication with junta
Social Democrats (SPD) (German
leaders, 363
Federal Republic), 86
WSAG meetings, 361
Socialist (Chile):
Powers, Thomas, 89
As possible coalition member, 1
Prado Casas, Benjamin, 77, 142, 157
Banning by junta of, 349, 355
Prats Gonzales, Gen. Carlos:
Communist differences with, 189,
Arms purchases from Soviet Union
190, 269, 302
by, 349
Elections (Apr. 1971), 220
As Army CinC, 162
Maoist faction within, 150 Canales retirement sought by, 293
Rally against Navy prisoners, 345 Civil strife as concern of, 323
Support for copper nationalization Compensation for nationalized
in, 12 property, 323
Suppression of MIR, opposition to, Coup in Chile:
157 As open to, 307, 313
References are to document numbers
339-370/428-S/80023
994 Index
Prats Gonzales, Gen. CarlosContinued Presidential election in Chile (Sept.
Coup in ChileContinued 1970)Continued
As potential leader of, 89, 306 40 Committee memorandum on, 29,
Increased possibility of, 326 38, 41
Opposition to, 309, 341 Freis strategy for, 5
Extradition of Argentine terrorists, Inaccuracy of polls in, 36, 62
306 Inactivity of MIR during period of, 62
Generals meeting in response to Inflation as issue in, 26
Allendes win, 65, 67 Need for confirmation by Congress
Opposition to Allende as president, as shown by polls, 53
50 Outlook for, 1, 28, 33, 47, 49
Schneider assassination, 162 Overview of, 89
Prebisch, Rau l, 132 Polling gains for Alessandri, 45
La Prensa, 200, 345 Polling gains for Allende, 37, 38, 41
Prensa Latina, 138 Retention of Korry as ambassador
Presidential election in Chile (Sept. during period of, 16
1970): Study of constitutional overthrow of
Allende electoral win in, 62 election results, 65
Alessandris statement on, 75 Valdes perception of U.S. as
Anacondas acquiescence to, 124, Alessandri supporter, 43
125 Womens support for Allende, 37, 38,
Generals meeting in response to, 62
65, 67 Price controls, 203
Possible actions after, 6, 50 Production Development Corporation
Reasons for, 89 (CORFO), 17
Tomic seen as architect of, 68 Protestants, 37
Tomics early acknowledgement of, Pueblo Libre, 157
65, 99 Punta Arenas, 155
Allendes prospects in, 28, 35 Punta del Este Resolution (1962), 195
Church subcommittee hearings on, Puro Chile, 161
322, 324
CIA position, 34, 36 Quigley, William E., Jr., 248, 353
Communist views on candidates in, Quintero, 155
26
Covert U.S. activities around: Rabasa Mishkin, Emilio O., 359
Anaconda request for Alessandri Radio Agricultura, 200, 303
funding, 32, 33, 35, 36 Radio Cooperativa, 188, 200
CIA plan for implementation of, Ralston-Purina, 208, 242
54, 55, 58 Ratliff, Rob Roy, 310, 340, 366
CIA position, 34, 36 Refugees in Argentina, 83
Continuation with Phase I, 44 Rescheduling of debt. See under
Expansion of program for: Economic situation in Chile
Mechanism for, 37 Reston, James, 251
Post-election activities, 35, 39 Reuters, 131
Recommendations for, 38 Richardson, Elliot L., 221
Reservations and objections to, Richardson, John, Jr.:
36, 39 Anacondas request for U.S. funding
Suspension of, 43 for Alessandri campaign, 32
Holdover of, 55 Freis message to Nixon, 83
Planning for, 53 Meeting with Frei, 79, 81, 96
Policy decisions, lack of coherence U.S.LDC relations, 48
in, 130 Riggs, Col. Francis, 169
Status report on, 57 Rio Treaty (1947), 106, 187, 195
Tomic as supported in, 30, 40 R os Valdivia, Alejandro, 207
References are to document numbers
339-370/428-S/80023
Index 995
Roa Garcia, Raul, 251 Rogers, William P.Continued
Robinson, Rear Adm. Rembrandt C., 91, Resignation of, 352
209
Retention of Korry as Ambassador to
Rockefeller, David, 183
Chile, 16
Rockefeller, Nelson A.:
U.S. courses of actions around
Message to Allende, 231, 315
confirmation of Chilean
Presidential mission to Latin
president, 88
America, 4, 23, 24
Romania, 327
Rodr guez Grez, Pablo, 144, 303
Roosevelt, Archibald, 31, 49
Rogers, William P.:
Rosenstein-Rodan, Paul:
Allende government:
Frei meetings with, 135, 142
Adoption of a strategy for U.S.
Korry interactions with, 56, 75, 76,
policy toward, 172, 173, 175
132
At the two-year mark, 302
Rostow, Walter W., 263
Congressional conflicts with, 302
Roth, Col. Robert C., 151
Operational issues before start of,
Ruiz, Cesar, 89, 330
160
Ruiz-Tagle Jimenez, Maria, 142
Anacondas request for U.S. funding
Rush, Kenneth:
for Alessandri campaign, 32
Covert U.S. actions in Chile, 292, 295
Bethlehem Steel buy-out agreement,
Kubischs Senate testimony, 352
217
SRG meetings, 298
Chileanization of copper industry, 13
WSAG meetings, 350
Church subcommittee hearings, 322,
Rusk, Dean, 187
324
Rwanda, 350
Compensation for nationalized
properties:
Saez Saez, Rau l: Chilean position, 262
Statement on, 266, 267, 281 Korry meetings with, 79, 80, 83, 132
U.S. policy on, 274 Lleras meetings with, 142
Congratulatory message for Allendes
Viaux public statement, 102
confirmation as President, 169
Saint George, Rear Adm. William R.,
Enterprise visit to Chile, proposed,
210
210
Salans, Carl F., 250
Excess profits, 327
Salzman, Herbert, 11
Inevitability of Allende as President,
Samuels, Nathaniel:
148
Anacondas request for U.S. funding
Kennecott Coppers nationalization,
for Alessandri campaign, 32
239
Chileanization of copper companies,
Korrys replacement as ambassador,
11
212, 223, 248
Compensation for nationalized
Meetings:
properties, 266
Of Kissinger with Almeyda, 264
Javits speech on nationalization, 206
Of Nixon with Allende, proposed,
Kennecott Coppers nationalization,
314
239
With Allende, 314, 327, 331
Nationalization of copper industry,
With Almeyda, 251, 262, 263
250
With Letelier, 215
Sanhuza Herbage, Fernando H., 5
With Valdes, 169
Santa Cruz, 315
Messages to Almeyda, 249, 250, 251,
Santa Gertrudis cattle, 183
252, 262
Santa Mar a Santa Cruz, Domingo, 15,
NSC meetings, 171, 173
61
NSSM 97, 46
Santiban ez Ceardi, Jorge, 79, 142 Rescheduling of Chilean debt, 320,
327 Sanz de Santamaria, Carlos, 81
References are to document numbers
339-370/428-S/80023
996 Index
Saunders, Harold H., 210 Selden, Armistead I., Jr.Continued
Schneider, Gen. Rene: SRG meetingsContinued
As necessary for effective coup, 144 Dec. 23, 1970, 194
As obstacle to coup, 89 Feb. 25, 1971, 210
Assassination of:
June 3, 1971, 233
As demoralizing to the military,
Sept. 9, 1971, 257
200
Zumwalts meeting with Allende, 207
As obstacle to coup, 168
Senate, U.S.:
CIA briefing notes on, 162, 168
Confirmation of Kissinger as
CIA role in, charges of, 163
Secretary of State, 353, 358, 359
Communist role in, possible, 161
Foreign Relations Committee, 356
Developments resulting from, 162
Church Committee, 310, 322
Funeral of, 165
Subcommittee on Western
PDC as absolved of role in, 216
Hemisphere Affairs, 322, 324,
U.S. denial of role in, 225
352
Cabinet crisis, response to, 108
Senior Review Group (SRG):
Constitutional sickness as problem
Boeing aircraft loan request, 228, 232,
of, 85
234, 235
Doctrine of non-intervention of, 50,
Covert U.S. actions in Chile, 283
55
IDB loans to Chilean universities,
Frei, relationship with, 50
183, 187, 196
Generals meeting in response to
Meetings:
Allendes win, 65, 67
Oct. 14, 1970, 130, 147, 149, 150
Impossibility of parliamentary
Oct. 17, 1970, 155, 158
solution for avoiding Allende
Oct. 29, 1970, 158, 166, 169
presidency, 108
Nov. 19, 1970, 181, 182, 183
Suspension of MAP training
Dec. 7, 1970, 186, 187
programs, 108
Dec. 23, 1970, 194, 196
Tomic campaign role of, 50
Feb. 17, 1971, 205, 206
Scowcroft, Brig. Gen. Brent:
Feb. 25, 1971, 210
Coup in Chile, 354
June 3, 1971, 232, 233, 234, 235
Military aid to Chile, 358
Sept. 9, 1971, 256, 257
U.S. communication with junta
Apr. 11, 1972, 294, 298
leaders, 363
Nationalization of property, 211
WSAG meetings, 350, 353, 361
NSDM 93, 181
Seaborg, Glen, 121, 127
NSSM 97, 53, 149
La Segunda, 323
Rescheduling of Chilean debt, 286,
Seidenmann, Neil, 327
298
Selden, Armistead I., Jr.:
Sepulveda Acun a, Adonis:
Cuban participation in OAS, 187
As director of investigations,
Enterprise visit to Chile, proposed,
possible, 5
210
Coup in Chile, 341
IDB loans to Chilean universities, 194
Elections (July 1971), 236
JCS representation at Ad Hoc
Senatorial by-election (Apr. 1971),
Interagency Working Group on
198, 218, 220
Chile, 183
Sepu lveda Galindo, Gen. Jose M., 142
Legislation on nationalization of
Servan-Schreiber, Jean-Jacques, 13
property, 202
Shackley, Theodore G., 304, 306, 313, Political situation in Chile, 178
317 SRG meetings:
Shakespeare, Frank J., 62, 101, 194 Oct. 17, 1970, 158
Shell Oil Co., 121, 135 Oct. 29, 1970, 169
Shlaudeman, Harry W.: Nov. 19, 1970, 183
Dec. 7, 1970, 187 Coup in Chile, 22, 23, 24, 344, 354
References are to document numbers
339-370/428-S/80023
Index 997
Shlaudeman, Harry W.Continued Special Latin American Coordinating
Committee (CECLA), 4 Covert U.S. actions in Chile, 317, 329,
Special National Intelligence Estimates 337, 362
(SNIE): Meetings:
9471, 241
With Silva, 22
Squella, Oscar, 177
With Valdes, 23
Standard Oil of Indiana, 8
U.S. military aid to Chile, 365
Stedman, William P., Jr., 32
Shultz, George P., 175, 327
Steel, 207
El Siglo, 22, 37, 59, 157
Strikes, labor:
Silva Espejo, Rene, 105
Allende opposition to, 132, 138
Silva, Patricio:
Anacondas Chuquicamata mine, 120,
Anti-American charges in Chilean
131, 132, 138
media, 163, 165
At ESSO lubrication blending plant,
Kunakov Archives, 56
135
Meeting with Korry, 22
Truckers strike, 310, 311, 338, 339
Meeting with Shlaudeman, 22
U.S. provoking of, 120
U.S. visa requests, 61
Sumar textile plant, 345
Silva Henr quez, Rau l, 33, 73, 97, 98
Sun Chemical Company, 290
Silva Solar, Julio, 121, 123
Szulc, Tad, 61, 65, 111
SIMEX, 279
Simon, William, 353, 361
Tacna Regiment, 20, 28, 55
Sims, Richard, 12
Tanks, 182, 183, 205, 206, 216
Sisco, Joseph J., 210
Tarud Siwady, Rafael, 25, 121
Sitting ducks, 166
Teitelboim, Volodia, 25, 120, 142
Sivari, Carlos, 79
Terrorism, 83, 306
Smith, Col. John C., 233
Thieme, Roberto, 345
Smith, Walter Bedell, 59
Thornton, Thomas, 210
Solzhenitsyn, Aleksandr I., 43
303 Committee:
Souper Onfray, Roberto F., 334, 335
Covert actions in Latin America,
South Africa, 197
briefing before, 7
Soviet Union:
Election program funding:
Allendes visit to, 315, 318
For schisms in Radical Party, 29
Campaign allegations of Allende
Mar. 1965 congressional election, 3
links to, 38, 90
Mar. 1969 congressional election, 3,
Chile, relations with:
7
Arms purchases, 279, 349
Sept. 1970, State Department
Breaking by Chilean junta of, 349,
planning meeting for request
354, 355
on, 28
Chilean position, 189
Meeting of Apr. 15, 1969, 3, 7
Economic aid, 241, 291, 294, 318
Tidd, Rear Adm. E. H., 207
Food aid, 361
Time (magazine):
Gosplan team visit, 291
Allende cover, 142, 157
Loan for fishing port, 207
Allende interview, 101
Machinery sales, 190
El Siglo attacks on, 157
Military cooperation, 156
Tirado Barros, Adm. Hugo, 152, 154,
Financing of Allendes 1964
162
campaign by, 90
Tito, Josip Broz, 158, 169, 170, 173
Military bases in Chile, possible, 91, Tlatelolco Treaty (1968), 195
187, 195 Toha Gonzalez, Jose:
Submarine base in Cuba of, 165 As acting President, 251, 252
Spain, 61, 351 Nationalization of copper industry,
Special Copper Tribunal, 302, 314, 316 205, 251
Special Group (5412), 3, 29 Threat of impeachment of, 276, 291
References are to document numbers
339-370/428-S/80023
998 Index
Tomic Errazuriz, Esteban, 123 Treasury, U.S. Department
Tomic Romero, Radomiro: ofContinued
As architect of Allendes victory, 68 Rescheduling of Chilean
As dogmatist, 73 debtContinued
As presidential candidate, 5, 45 Nixons decision on, 288
Defense of U.S. foreign policy by, 37 Options for, 274, 275
Early acknowledgement of Allende Trinidad and Tobago, 187
victory by, 65, 99 Troncoso Castillo, Rau l, 61, 120, 163,
Fulbright relationship with, 79 165
Inflation, 5 Trueheart, William, 7
Loan issue, 291 Tunisia, 327
Mar n as supporter of, 236 Tupamaros, 150
Meetings:
With Frei, 5 Uganda, 360
With Korry, 265 Ultima Hora, 252
Nationalization of copper industry, 5 Ultima Noticias, 22
PDC truce with Allende, proposed, UNI TAS exercises, 61, 183, 345, 350,
307 353
Prospects as presidential candidate: United Kingdom (UK):
Advocacy of U.S. support for, 30, Chile, relations with:
40 Allende as supported by, 65, 116,
Freis perspectives on, 27, 61 117, 119
Gaining ground in campaign, 33 Loans to Allende government by,
Stagnation in, 38 124, 125, 138, 164
U.S. lack of support, 33 Frei as seen in, 61
U.S. perspectives on, 23, 28, 29, 37 Nationalization of property of, 277
Womens support for, 62 On Castros government, 69
Pueblo Libre attacks on, 157 Rescheduling of Chilean debt, 275,
Purchasing share of copper 294
companies, 11 United Nations (UN):
Recovery from illness of, 26 Allende visit to, 314, 315, 318
Schneider role in Presidential Chilean positions in, 47
campaign of, 50 Human Rights Commission, 361
UP as seen by, 269 Resolution 1803, 302
U.S. perspectives on possible United Nations Conference on Trade
administration of, 47 and Development (UNCTAD)
Viaux television interview, 25 Meeting (Santiago, Apr. 1972), 262,
Washington Post interview of, 5 294
Yugoslavia as model for, 47 United Nations Development
Toro Mazote, Gen. Carlos, 144 Programme (UNDP), 4
Tourism, 156 United Nations Security Council
Trading with the Enemy Act (1917), 187 (UNSC), 353
Transactionalism, 276 United States economic aid to Chile:
Treasury, U.S. Department of: Agricultural-sector loan, 194
Boeing aircraft loan request, 234, 235 Amounts of, 84
Economic aid to Chile, 350 Benefits from, 2
IDB loans to Chilean universities, 194 CCC credit financing for, 361
Program loan negotiations with Chilean attacks on, 4
Chile, 11 Cut-off of, 111
Rescheduling of Chilean debt: Emergency medical supplies, 353,
Agreement at multilateral talks on, 361, 364
297 Exposure to, 121
Binding arbitration vs. negotiation In event of coup, 70, 106, 140, 144
for, 294, 298, 328 Minimizing of, 279
References are to document numbers
339-370/428-S/80023
Index 999
United States economic aid to Urrutia Manzano, Enrique, 351
Uruguay: ChileContinued
Castro criticism of, 276
P.L. 480 aid to Chile, 84, 187, 194
Communist government in, possible,
Program loan negotiations with
18
Chile, 11
Tupamaros, 150
Restriction of, 175
U.S. consultations on public posture
Resumption under Pinochet junta of,
to Allende government, 155
350, 353, 361, 364
U.S. military assistance to, 156
Withdrawal of new commitments,
Urzua Merino, Rear Adm. Luis, 89
181, 182
United States Information Agency
Vaky, Viron P.:
(USIA), 101, 112, 183
Allende government, 159, 167
United States Information Service
Chileanization of copper companies,
(USIS), 156
9
United States military aid to Chile (see
Church subcommittee hearings, 322,
also Aircraft; Armed forces of
324
Chile; Military Assistance
CIA paper on covert options for
Program):
Chile, 166
Amounts of, 18, 84
Confirmation of Chilean President,
Argentine position, 232
54, 57, 68, 76, 164, 169
Congressional restraints on, 6
Coup in Chile, possibility of, 71
Continuation of in event of coup, 106,
Covert U.S. actions in Chile:
112, 113
Mechanisms for carrying out 40
Flares and helmets, 358, 361
Committee decisions, 95
Foreign Military Sales Program: Policy decisions, lack of coherence
Honoring of contracts for, 148, 150 in, 130
Presidential election, 1970, 30, 39, Referral to Nixon of decision on,
40
233, 235
Uncertainty about Korrys actions
SRG discussion of, 205, 206, 232,
in, 98
234
European views on election of
Grant aid, 312
Allende, 69
Korry-Ossa discussion of, 108, 120
40 Committee meetings:
Paratroop equipment, 232
Sept. 8, 1970, 66, 70
Peruvian position, 232
Sept. 14, 1970, 86, 92
Renewal of previously-contracted-for
Sept. 19, 1970, 104
shipments, 159, 160
Sept. 22, 1970, 111, 112
Ship loans, 194
Sept. 29, 1970, 127
Tanks, 182, 183, 205, 206, 216
Oct. 6, 1970, 134, 138
Threat of cut-off of, 138
Oct. 14, 1970, 149
Timing for, 298
Generals meeting in response to
Under Allende government:
Allendes win, 67
Continuation of, 181
Inevitability of Allende as President,
Delay of decisions on, 183
134
Hickenlooper Amendment and, 279
Kissinger meeting with Korry and
Questions around, 182, 183
Meyer, 13
Under Pinochet junta, 365
Korrys messages seen as inadequate,
University of Chile, 165, 194
117
Law School, 81
Long-term perspectives on Chilean
Uranium, 121, 127
politics, 40
Urbina, Gen. Orlando, 89, 341, 349 Memorandum for 40 Committee, 106
Urrutia Soto, Javier, 331 Messages:
Urrutia Leio, Manuel, 81 From Kissinger to McCone, 90
References are to document numbers
339-370/428-S/80023
1000 Index
Vaky, Viron P.Continued Valenzuela Godoy, Gen.
MessagesContinued CamiloContinued
From Korry to Kissinger, 83 Opposition to Allende as president,
From Nixon to Frei, 14 50
To Kissinger, 109 Schneider assassination, 162
Miranda as go-between to Allende, Selection by Wimert for funding to
165 block Allende, 151
NSSM 97, 53, 130, 147, 156 Viaux meetings with, 105
PDCs eight-point list of assurances Valery, Paul, 35
requested of Allende, 134 Valtin, Fred, 49
Retention of Korry as Ambassador to Vazquez Carrizosa, Alfredo, 183
Chile, 16 Velasco Alvarado, Gen. Juan, 19, 26, 169
SRG meetings, 130, 147, 150, 158, 169 Venezuela:
Viauxs attempted coup, 20, 21 Allende visit to, 315
Valdes, Pablo, 23, 228, 242, 284 As Andean Pact member, 327
Valdes Subercaseaux, Gabriel: Concern over possible coup attempt
Allende as supported by, 98 in Chile, 24
Allende government, 169, 173 U.S. consultation against Allende
As appeaser, 62 government with, 134, 155
As member of ministerial committee, Viaux Marambio, Gen. Roberto U.:
5 Anti-communist declaration of, 83
CECLA meeting, 4 Arrest of, 162, 168
CIA press comments on Viaux coup As erratic, 59
attempt, 23 As not a threat, 61
Cuban-Chilean relations, 48 As political force, 27
Denunciation of extradition treaty by, Attempted coup by:
56 Chilean sensitivity to assumed U.S.
Early acknowledgement of Allende involvement in, 22, 23, 28
victory by, 65 CIA press comments on, 21, 22, 23
Frei as UN Secretary-General, 120 Freis handling of, 29
Freis relationship with, 26 Prospects for, 19
Iban ezs visit to Washington, 33 Reports of, 20
Korry as seen by, 219 Results of, 89
Meetings: Freis views on, 61
With Allende, 123 Generals meeting in response to
With Rogers, 169 Allendes win, 65
With Shlaudeman, 23 Lack of military support for, 152
Personality of, 26, 27, 89 Military pay scale complaints of, 24,
UP as seen by, 269 29
U.S. foreign aid to Chile, 4 Overthrow of Allende by, possible,
U.S. lack of support for Tomic, 33 50
U.S. seen as Alessandri supporter by, Political ambitions of, 26
43 Public statements of, 101, 102, 105
Valenzuela Godoy, Gen. Camilo: Request for meeting with Allende by,
Arrest of UP functionaries, 105 78
As a key officer for CIA contact, 129 Restraining of, 64
As Jefe de Plaza, Santiago Garrison, Second coup of, possible:
162, 168 As counterproductive to FUBELT,
Coup participation of, possible, 154 154
Disarray within the armed forces, 68 CIA views on, 55
Freis message to, 83 CIA warning against, 152, 153, 154
Generals meeting in response to Likely ineffectiveness of, 89, 141,
Allendes win, 65 144, 149
Korrys message to, 103 Valenzuela meetings with, 105
References are to document numbers
339-370/428-S/80023
Index 1001
Vietnam, Democatic Republic of, 150, Western EuropeContinued
155, 167, 183, 349, 355 Assistance to post-coup government,
Vietnam, Republic of, 87 possible, 313
Vietnamization, 170 Copper purchases by, 194
Vigilantism, 291 PDC funds raised in, 271
Vilarin Marin, Leon, 338 Trade with Chile, 214
Visa issuance suspension, 61 Western Hemisphere, 156
Vivero Avila, Gen. Arturo, 303 Westmoreland, Gen. William, 173
Viveros Duran, Gen. Ramon, 291 Wheat, 349, 350, 355, 361
Voice of America (VOA), 101, 112 Wimert, Lt. Col. Paul, Jr., 65, 151
Volcker, Paul A., 277, 282, 294, 298 Women:
Vuskcovic Bravo, Pedro: As abstaining from voting, 89
Economists gathering for Prebisch March of the Empty Pots, 276, 281
Report, 132 Support for Allende by, 37, 38, 62
Mission to the United States, 208 Support for Tomic in election, 62
Monetary liquidity, 68 Woods, George, 244
Press declarations of, 101 Worker councils, 161
Zumwalts meeting with Rios Workers United Center (CUT), 190
Valdivia, 207
Xuan Thuy, 122
Walker, Charls E., 257, 275
Walters, Maj. Gen. Vernon A., 170, 309 Yarur family, 5
Wandler, Mark, 233, 257 Yugoslavia:
Washington Post: As Tomics model for Chile, 47
Ambassadors reaction to NY Times Chile, relations with, 360
visa article, 65 Ford truck manufacture in, 33
Dungan article in, 121 Frei as seen in, 61
Replacement of Korry as Chilean United States, relations with, 158, 327
Ambassador, 204
Tomic interview, 5 Zaldivar Larra n, Andre`s:
Washington Special Action Group As member of ministerial committee,
(WSAG): 5
Coup prospects for Chile, 312 Chileanization of copper companies,
Meetings: 15
Sept. 21, 1970, 104 Economic situation in Chile, 121, 135
Sept. 12, 1973, 348, 350 Monetary liquidity, 68
Sept. 14, 1973, 353 Negotiations with copper companies,
Sept. 20, 1973, 353, 355, 361 12
Washington Star, 65 Resignation of, possible, 102, 103, 105
Weinel, Vice Adm. John P., 350, 353, Senatorial by-election (Apr. 1971),
361 198, 200, 213, 218, 219, 220
Weintraub, Sidney: Vuscovics press declarations, 101
Chileanization of copper companies, 11 Zambia, 173, 197
Meetings, With Frei, 12 Ziegler, Ronald, 159, 352
Nationalization of copper industry, Zorrillas Rojas, Americo, 284
250 Zumwalt, Jr., Adm. Elmo R.:
Rescheduling of Chilean debt, 284, Allende meeting with, 207, 210
286, 318, 320 Covert U.S. actions in Chile, 283
SRG meetings, 298 Enterprise visit to Chile, proposed,
Welander, Rear Adm. Robert O., 257 207, 209, 210, 327
Wellons, A. E., 42 Rios Valdivia meeting with, 207
Wells, William, 49, 149 Soviet military bases in Chile,
Western Europe: possible, 91
Allende inauguration, 155, 164 SRG meetings, 210
References are to document numbers