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December 22, 2016
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August 9, 2011
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September 30, 1974
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Approved For Release 2011/08/09: CIA-RDP09TOO207RO01000020023-8 ;Ep 1974 Chile: A Case Study The U.S. began its heavy investment in the political fate of Chile in the early 1960s. President John Kennedy had met Eduardo Frei, leader of the Christian Democratic Party in Chile. and decided that he was the hope of Latin America. Frei was a man of the left, but not too far left, a man who was not hostile to U.S. interests and just might be able to achieve needed reform without violent revolution. When Frei faced Salvador Allende, a self-professed Marxist with a Com- munist following, in the 1964 election, the U.S. made no se- cret of where its sympathies lay. Frei became the recipient of American political advice, en- couragement and hefty financial aid. Between 1962 and 1965, the U.S. gave Chile S618 million indirect economic assistance -more per capita than any other Latin American country. In a diary due to be published in Britain this year, former CIA Operative Philip Agee describes how he was called upon for assistance from his post in Montevideo in 1964: "The San- tiago station has a really big operation going to keep Sal- vador Allende from being elected President. He was almost elected at the last elections in 1958, and this time nobody's tak- ing any chances. The trouble is that the office of finance in headquarters [Langley, Va.] couldn't get enough Chilean es- cudos from the New York banks; so they had to set up re- gional purchasing offices in Lima and Rio. But even these offices cant satisfy the requirement, so we have been asked to help." The results were gratifying. Frei won with 56% of the vote, and the future of Chile seemed to be assured. But from the outset, Frei ran into trouble. He was at- tacked by the right for moving too fast and by the left for going too slowly. Allende's Socialist Party continued to grow, picking up defecting left-wing Christian Democrats and unit- ing with other opposition parties. It became a case for the CIA. A station chief had been sent to Santiago in 1964; later the agency's presence began to multiply in preparation for the 19 70 election, '. hen Frei would be constitutionally barred from seeking a second term and Allende would pose more of a threat than before. TinIE has learned that a CIA team was posted to Chile with orders from the National Security Council to keep the election "fair." The agents interpreted these instructions to mean: Stop Allende. and they asked for a whopping $20 mil- lion to do the job. They were given S5 million and ultimately spent less than S 1 million. "You buy votes in Boston, you buy votes in Santiago," commented a former CIA agent assigned to the mission. But not enough votes were bought; Allende had a substantial following. He was prevented from winning a majority, but with only 36% of the vote he narrowly won a three-way race that was finally decided in the Chilean Con- gress. CIA officials in Washington were furious. The Nixon Administration saw the Allende regime as more of a threat than Cuba to the hemisphere. The White House feared that Chile would serve as a base for South Amer- ica's revolutionary left as well as a convenient outpost for the Soviet Union. So many Marxist activists were pouring in from Cuba. Czechoslovakia and China that a special team of CIA clerks was dispatched to Chile to start indexing thousands of cards on their activities. Publicly, Henry Kissinger warned of the domino effect in Latin America. If Communism could find a secure berth in Chile, it would be encouraged to spread throughout the continent. Privately. the 40 Committee, the top-level intelligence panel headed by Kissinger, authorized SS million to be spent to make life even tougher for Allende than he was making it for himself. The extent of the CIA's involvement was revealed earlier this month by congressional sources who had been privy to earlier testimony by CIA Director William Colby. Further de- tails have been supplied by other agency officials. Precisely how much was spent by foreign Communists-principally 'Moscow-to get Allende into office and then to keep him there is not known. Most Western intelligence experts figure that the CIA campaign was scarcely comparable in terms of ex- penditures or intensity. Nonetheless, the agency went further than even many of its critics imagined. For a Marxist government, the Allende regime had moved relatively slowly toward' suppressing free institutions. But the CIA believed it was only a matter of time before all dissent would be muffled. Approximately half the CIA funds were fun- neled to the opposition press, notably the nation's leading daily El Mercurio,; Allende had steered government adver- tising to the papers supporting him while encouraging news- print prices to rise high enough to bankrupt the others. Ad- ditional CIA funds went to opposition politicians, private businesses and trade unions. "What we were really doing was supporting a civilian resistance movement against an arbi- trary government," argues a CIA official. "Our target was the middle-class groups who were working against Allende." Covert assistance went beyond help for the democratic op- position. The CIA infiltrated Chilean agents into the upper ech- elon of the Socialist Party. Provocateurs were paid to make deliberate mistakes in their jobs, thus adding to Allende's gross mismanagement of the economy. CIA agents orga- nized street demonstrations against government policies. As the economic crisis deepened, the agency sup- ported striking shopkeepers and taxi drivers. Laundered CIA money, reportedly chan- Christian Democratic parties in Europe, helped finance the Chilean truckers' 45-day strike, one of the worst blows to the economy. Moreover, the strikers doubtless. picked up additional CIA cash that was floating round the coun- try. As an intelligence official notes, "If we give it to A, and then A gives it to B and C and D, in a sense it's true that D got it. But the question is: Did we give it to A knowing D would get it?" While owning up to CIA efforts to weaken Allende, Colby insists: "We didn't sup- port the coup, we didn't stim- ulate it, we didn't bring it about in any way. We were quite meticulous in making sure there was no, encouragement from our side." Most U.S. pol- icymakers would have preferred that Allende be ousted in democratic fashion at the election scheduled for 1976. That kind of exit, they feel, would have decisively proved the bank- ruptcy of his policies. Clearly the CIA considers the junta to be the lesser of two evils. Still, it rates the Chilean enterprise a failure since it ended in military dictatorship. Several years of dangerous, 'costly and now nationally divisive intervention in another country's internal politics might better have been avoided. Though Soviet propaganda blames the CIA for the Chilean coup and the death of Allende, Soviet intelligence analysts do not give the CIA any credit. The Russians think the fault lay with Allende himself for not being enough of a strong- man. He temporized with constitutional processes when he should have disregarded them. He did not follow the exam- pie of Fidel Castro, who executed more than 1.000 of his op- ponents when he came to power; 15 years later, he still rules Cuba. Nor did the CIA have any better luck against him. !, Approved For Release 2011/08/09: CIA-RDP09TOO207RO01000020023-8