Allende
W: Yeah. Well, just on the first point you made about the meanness or the lack of meanness in the book, that was something I wanted to be very conscientious about when I went through edits with my editor. There’s a great scholar and writer at UC Berkeley who said something that I saw quoted recently: “Be tough on the institutions, and be soft on the people.” And that was reinforced again and again when I saw some of the collaborators with these cultural fronts of the CIA changing their minds, learning from things like Vietnam. And seeing them change their minds actually gave me a lot of hope, because you know, you can be on the payroll; you can be someone who’s an operator; you can be someone who thinks of the world as a good side and a bad side, and therefore whatever we do represents the good side. And then you can wake up from that. You mentioned Sartre; he was absolutely attacked by one of the CIA’s magazines, and his magazine was seen as a threat, and the French magazine Preuves, based out of Paris, was in some ways an answer to Sartre’s magazine and his attempts to deal, to treat the United States the way it should be treated. When it was going against its values, he would call them out on that. Neruda, Pablo Neruda, the poet, was another one who suffered severe reputational damage by this cultural front of the CIA, the Congress for Cultural Freedom. When they found out, some of these operators found out that he was up for the Nobel in ‘63, they wrote a quiet, sort of secret white paper about him, and they made some links to Stalinism through his Stalin [Peace] Prize. And it was, of course, the year that Stalin had died that he took it. And they also made up some stuff that I think was, you know, viciously untrue, that he was in on the attempt to murder Trotsky. So this is reputational damage that then is doubled later by the CIA’s actual overthrow of his friend in Chile, Salvador Allende. So what I see is if someone’s being physically harmed by the CIA, that’s one thing that we’ve accounted for in a lot of historical books and political books; if someone’s being reputationally damaged by CIA propaganda, you see that in some of the academic books that look at the so-called cultural Cold War. But I wanted to remove the wall between those two areas and show that both of those things happened in a context where a lot of people were just made terrified by the fact that you had evil on one side and a fighting-fire-with-fire mentality on so-called, quote unquote, our side.
RS: [omission] We’re back with Joel Whitney, and the book is called “Finks: How the C.I.A. Tricked the World’s Best Writers.”
http://en.wikipedia.org/wiki/Salvador_Allende
Presidency
Main article: Chile under Allende
Allende with Argentine President Héctor José Cámpora
Upon assuming power, Allende began to carry out his platform of implementing a socialist program called La vía chilena al socialismo ("the Chilean Path to Socialism"). This included nationalization of large-scale industries (notably copper mining and banking), and government administration of the health care system, educational system (with the help of an American educator, Jane A. Hobson-Gonzalez from Kokomo, Indiana), a program of free milk for children in the schools and shanty towns of Chile, and an expansion of the land seizure and redistribution already begun under his predecessor Eduardo Frei Montalva,[^^18]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-17) who had nationalized between one-fifth and one-quarter of all the properties listed for takeover.[^^19]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-18) The Allende government's intention was to seize all holdings of more than eighty irrigated hectares.[^^20]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-19) Allende also intended to improve the socio-economic welfare of Chile's poorest citizens;[citation needed] a key element was to provide employment, either in the new nationalised enterprises or on public work projects.[citation needed]
Chilean presidents were allowed a maximum term of six years, which may explain Allende's haste to restructure the economy. Not only was a major restructuring program organized (the *Vuskovic plan*), he had to make it a success if a Socialist successor to Allende was going to be elected. In the first year of Allende's term, the short-term economic results of Minister of the Economy Pedro Vuskovic's expansive monetary policy were favorable: 12% industrial growth and an 8.6% increase in GDP, accompanied by major declines in inflation (down from 34.9% to 22.1%) and unemployment (down to 3.8%). However by 1972, the Chilean escudo had an inflation rate of 140%. The average Real GDP contracted between 1971 and 1973 at an annual rate of 5.6% ("negative growth"); and the government's fiscal deficit soared while foreign reserves declined [Flores, 1997: source requires title/publisher]. The combination of inflation and government-mandated price-fixing, together with the "disappearance" of basic commodities from supermarket shelves, led to the rise of black markets in rice, beans, sugar, and flour.[^^21]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-icarito-comienzan-20) The Chilean economy also suffered as a result of a US campaign against the Allende government.[^^22]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-covert-21) The Allende government announced it would default on debts owed to international creditors and foreign governments. Allende also froze all prices while raising salaries. His implementation of these policies was strongly opposed by landowners, employers, businessmen and transporters associations, and some civil servants and professional unions. The rightist opposition was led by National Party, the Roman Catholic Church (which in 1973 was displeased with the direction of educational policy[^^23]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-22)), and eventually the Christian Democrats. There were growing tensions with foreign multinational corporations and the government of the United States.
Allende also undertook Project Cybersyn, a system of networked telex machines and computers. Cybersyn was developed by British cybernetics expert Stafford Beer. The network transmitted data from factories to the government in Santiago, allowing for economic planning in real-time.[^^24]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-23)
In 1971, Chile re-established diplomatic relations with Cuba, joining Mexico and Canada in rejecting a previously-established Organization of American States convention prohibiting governments in the Western Hemisphere from establishing diplomatic relations with Cuba. Shortly afterward, Cuban president Fidel Castro made a month-long visit to Chile. Originally the visit was supposed to be one week, however Castro enjoyed Chile, and one week turned to another. The visit, in which Castro held massive rallies and gave public advice to Allende, was seen by those on the political right as proof to support their view that "The Chilean Path to Socialism" was an effort to put Chile on the same path as Cuba.[citation needed] Castro after his visit drew the conclusion; Cuba has nothing to learn from Chile.[citation needed]
October 1972 saw the first of what were to be a wave of strikes. The strikes were led first by truckers, and later by small businessmen, some (mostly professional) unions and some student groups. Other than the inevitable damage to the economy, the chief effect of the 24-day strike was to induce Allende to bring the head of the army, general Carlos Prats, into the government as Interior Minister.[^^21]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-icarito-comienzan-20) Allende also instructed the government to begin requisitioning trucks in order to keep the nation from coming to a halt. Government supporters also helped to mobilize trucks and buses but violence served as a deterrent to full mobilization, even with police protection for the strike breakers. Allende's actions were eventually declared unlawful by the Chilean appeals court and the government was ordered to return trucks to their owners.[^^25]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-24)
Throughout this presidency racial tensions between the poor descendants of indigenous people and slaves, who supported Allende's reforms, and the white settler elite increased.[^^26]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-25)
Allende raised wages on a number of occasions throughout 1970 and 1971, but these wage hikes were negated by the in-tandem inflation of Chile's fiat currency. Although price rises had also been high under Frei (27% a year between 1967 and 1970), a basic basket of consumer goods rose by 120% from 190 to 421 escudos in one month alone, August 1972. In the period 1970-72, while Allende was in government, exports fell 24% and imports rose 26%, with imports of food rising an estimated 149%.[^^27]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-26)
Export income fell due to a hard hit copper industry: the price of copper on international markets fell by almost a third, and post-nationalization copper production fell as well. Copper is Chile's single most important export (more than half of Chile's export receipts were from this sole commodity[^^28]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-27)). The price of copper fell from a peak of $66 per ton in 1970 to only $48–9 in 1971 and 1972.[^^29]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-28) Chile was already dependent on food imports, and this decline in export earnings coincided with declines in domestic food production following Allende's agrarian reforms.[^^30]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-29)
Throughout his presidency, Allende remained at odds with the Chilean Congress, which was dominated by the Christian Democratic Party. The Christian Democrats (who had campaigned on a socialist platform in the 1970 elections, but drifted away from those positions during Allende's presidency, eventually forming a coalition with the National Party), continued to accuse Allende of leading Chile toward a Cuban-style dictatorship, and sought to overturn many of his more radical policies. Allende and his opponents in Congress repeatedly accused each other of undermining the Chilean Constitution and acting undemocratically.
Allende's increasingly bold socialist policies (partly in response to pressure from some of the more radical members within his coalition), combined with his close contacts with Cuba, heightened fears in Washington. The Nixon administration began exerting economic pressure on Chile via multilateral organizations, and continued to back Allende's opponents in the Chilean Congress. Almost immediately after his election, Nixon directed CIA and U.S. State Department officials to "put pressure" on the Allende government.[^^31]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-Still-30)
[edit] Foreign relations during Allende's presidency
Allende's Popular Unity government tried to maintain normal relations with the United States. When Chile nationalized its copper industry, Washington cut off U.S. credits and increased its support to opposition. Forced to seek alternative sources of trade and finance, Chile gained commitments from the Soviet Union to invest some $400 million in Chile in the next six years. Allende's government was disappointed that it received far less economic assistance from the USSR than it hoped for. Trade between the two countries did not significantly increase and the credits were mainly linked to the purchase of Soviet equipment. Moreover, credits from the Soviet Union were much less than those provided by People's Republic of China and countries of Eastern Europe. When Allende visited the USSR in late 1972 in search of more aid and additional lines of credit, after 3 years of political and economic failure and chaos he was turned down.[^^32]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-31)
[edit] Foreign involvement in Chile during Allende's Presidency
[edit] US involvement
Main article: United States intervention in Chile
The possibility of Allende winning Chile's 1970 election was deemed a disaster by a US government who wanted to protect US business interests and prevent any spread of communism during the Cold War.[^^33]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-32) In September 1970, President Nixon informed the CIA that an Allende government in Chile would not be acceptable and authorized $10 million to stop Allende from coming to power or unseat him[^^34]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-Hinchey-33). The CIA's plans to impede Allende's investiture as President of Chile were known as "Track I" and "Track II"; Track I sought to prevent Allende from assuming power via so-called "parliamentary trickery", while under the Track II initiative, the CIA tried to convince key Chilean military officers to carry out a coup.[^^34]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-Hinchey-33)
The United States administration believed there was a possibility of Soviet-style communist takeover and was openly hostile to Allende.[^^22]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-covert-21)[^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-34)35]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-34) During Nixon's presidency, U.S. officials attempted to prevent Allende's election by financing political parties aligned with opposition candidate Jorge Alessandri and supporting strikes in the mining and transportation sectors.[^^36]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-35)
After the 1970 election, the Track I operation attempted to incite Chile's outgoing president, Eduardo Frei Montalva, to persuade his party (PDC) to vote in Congress for Alessandri.[citation needed] Under the plan, Alessandri would resign his office immediately after assuming it and call new elections. Eduardo Frei would then be constitutionally able to run again (since the Chilean Constitution did not allow a president to hold two consecutive terms, but allowed multiple non-consecutive ones), and presumably easily defeat Allende. The Chilean Congress instead chose Allende as President, on the condition that he would sign a "Statute of Constitutional Guarantees" affirming that he would respect and obey the Chilean Constitution, and that his reforms would not undermine any element of it.
Track II was aborted, as parallel initiatives already underway within the Chilean military rendered it moot.[^^37]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-36)
The United States has acknowledged having played a role in Chilean politics prior to the coup, but its degree of involvement in the coup itself is debated. The CIA was notified by its Chilean contacts of the impending coup two days in advance, but contends it "played no direct role in" the coup.[^^38]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-37)
Much of the internal opposition to Allende's policies came from business sector, and recently-released U.S. government documents confirm that the U.S. indirectly [^^22]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-covert-21) funded the truck drivers' strike,[^^39]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-38) which exacerbated the already chaotic economic situation prior to the coup.
The most prominent U.S. corporations in Chile prior to Allende's presidency were the Anaconda and Kennecott Copper companies, and ITT, International Telephone and Telegraph. Both the copper corporations aimed to expand privatized copper production in the city of El Teniente, Chile, the world's largest underground copper mine.[^^40]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-multinationals-39) At the end of 1968, according to Department of Commerce data, U.S. corporate holdings in Chile amounted to $964 million. Anaconda and Kennecott accounted for 28% of U.S. holdings, but ITT had by far the largest holding of any single corporation, with an investment of $200 million in Chile.[^^40]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-multinationals-39) In 1970, before Allende was elected, ITT owned 70% of Chitelco, the Chilean Telephone Company and funded El Mercurio, a Chilean right-wing newspaper. Documents released in 2000 by the CIA confirmed that before the elections of 1970, ITT gave $700,000 to Allende's conservative opponent, Jorge Alessandri, with help from the CIA on how to channel the money safely. ITT president Harold Geneen also offered $1 million to the CIA to help defeat Allende in the elections.[^^41]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-40)
After General Pinochet assumed power, United States Secretary of State Henry Kissinger told President Richard Nixon that the U.S. "didn't do it," but "we helped them...created the conditions as great as possible." (referring to the coup itself)[^^42]^(http://en.wikipedia.org/wiki/Salvador_Allende#cite_note-41). Recent documents declassified under the Clinton administration's Chile Declassification Project show that the United States government and the CIA sought the overthrow of Allende in 1970 immediately before he took office ("Project FUBELT"), but claims of their direct involvement in the 1973 coup are not proven by any publicly available documentary evidence, although many documents still remain classified.[citation needed]