Allende's Chile And The Inter-American Cold War Part 3

A few months earlier, Allende had tried to improve the UP's economic strategies by dismissing his controversial minister of the economy and appointing the more pragmatic Communist, Orlando Millas.118 In part, the move had been an effort to placate the Soviets, to show the socialist bloc countries that Chile now had a grasp of the economy, and to persuade them to offer Chile more a.s.sistance. By August, however, Allende was warning supporters about the inadequacies of Soviet bloc aid to meet Chile's economic needs. As he had lamented, socialist credits for industrial investment and future economic development would take "two or three years" to be effective.119 Indeed, Moscow's relationship with Santiago was evolving too slowly when it came to the rapidly changing situation within Chile.

Unbeknownst to the Chileans, the Soviet leadership was also increasingly disdainful of the UP's performance. A report written by the Latin American Inst.i.tute at Moscow's Academy of Sciences in mid-1972 had described the Chilean situation as "uncertain and unstable" and had predicted the months ahead would be "agitated and tense." The UP had only partial political power, its authors argued, and Chilean parties had no fixed ideas or immediate means or potentials for launching Chile on a road to socialism.120 In fact, in the context of disturbances between left-wing supporters in Concepcion back in May, the Soviet Union's amba.s.sador in Santiago had called all Soviet bloc amba.s.sadors in the capital together to discuss the "deep crisis" developing within the UP. A month later, the East German amba.s.sador had reported back to Berlin that left-wing Chilean unity remained a problem and was likely to remain one for the foreseeable future. To be sure, he noted that the UP's composition had changed and that the PCCh was making concerted efforts to curb "adventurism." But, overall, he lamented the growing divergence between the Communist and Socialist parties, caused by the "outright lack of maturity" and discipline within the PS itself.121 Then, in October 1972, the Soviets downgraded their definition of Chile from a country "building socialism" to a Third World nation seeking "free and independent development on the path of democracy and progress."122 For their part, however, Allende's inner circle tended to concentrate on global developments rather than internal developments when explaining the Soviets' lack of interest in offering more meaningful a.s.sistance. As Letelier pointed out, Chile's timing in seeking more a.s.sistance from the East was bad. One only had to recognize that for "tactical and strategic reasons on both sides," the world was "living through a moment of convergence and understanding between the United States and socialist countries," which meant that Chile could not expect to receive the same type and amount of financial help from the Soviet bloc that it might otherwise have.123 Allende's curious decision to send the anti-Soviet Socialist, Carlos Altamirano, to the USSR just one month after Nixon's summit with Brezhnev must also not have helped win over the Soviet leadership, suspicious as it was of far Left "extremists" hijacking the Chilean revolutionary process.124 Even so, as the Soviets dragged their feet, Chile was in ever greater need of hard-currency loans to cover its balance-of-payments deficit. In conversation with a U.S. Emba.s.sy official, a Chilean lawyer with contacts in the UP government described Orlando Millas as an "astute and able man" who recognized the USSR would not necessarily be as forthcoming as hoped: "[Millas] realizes that Chile's economic problems are grave and that a solution will require credit from abroad. The extent to which this help will be provided by the Soviet Union is limited ... the only alternative, therefore, is for Chile to restore its financial relations with the West, particularly the U.S. Millas, who like most Chilean Communists is above all a pragmatist, will have no ideological difficulty in moving in this direction ... [and] realizes that the kind of financial relations he desires will not be possible unless there is progress in solving outstanding bilateral economic problems between Chile and the U.S."125 Although himself a Socialist, Letelier offered a similar a.s.sessment, reasoning that given the state of world politics, socialist countries would be more likely to increase their a.s.sistance to the UP if Chile first repaired relations with developed countries in the West. As he saw things in August and September 1972, hopes of seeking benefits from contradictions between capitalist countries were futile because of the growing interdependency between them. He thus urged the Chileans to transcend the deadlock in U.S.-Chilean relations by pushing for a meaningful compromise.126 The three obvious questions Letelier's proposals raised were, first, whether the Nixon administration would be at all receptive to the idea of meaningful bilateral negotiations; second, what exactly the Chileans could ask for in return for certain compromises; and, finally, whether he could persuade the whole of the fractious UP coalition-and particularly the Socialist Party-that this was the best course forward. By late 1972, it seemed clear to Chilean diplomats that the United States was "playing dirty." Chilean properties in the United States had been ransacked, and its diplomats were so worried about being under surveillance that they were using voice distorters during telephone conversations or conducting conversations outdoors.127 The Chilean Emba.s.sy in Washington had also been burgled in May, and although intruders had ignored valuables, they had stolen a list of subscriptions to emba.s.sy publications and four radios that staff had been using to m.u.f.fle sensitive conversations. Indeed, the Chileans suspected the U.S. government and/or multinationals were behind the robbery, especially when a similar burglary took place at the Watergate complex a month later.128 Even so, Letelier was now insisting that the UP still had a slight window of opportunity before things got even worse. To some extent, his appreciation of the severe deterioration of Chile's position was conditioned by his exaggerated faith in Kissinger's rea.s.surances the previous year. Yet, it was also clear that Allende was running out of options when it came to avoiding confrontation with the United States over compensation claims. Looking ahead to what they expected would be the Chilean Special Copper Tribunal's rejection of Anaconda's appeal on the "excess profits" ruling, Chilean diplomats had been trying to keep Chile's international options open by rescheduling debt repayments with other Paris Club creditors as quickly as possible (and not always as satisfactorily as more time might have allowed).129 As Letelier forewarned, the tribunal's p.r.o.nouncement was likely to undercut the Chileans' chances of receiving credits from international organizations, U.S. government organizations, and private banks. He also observed that those in Washington who were happy to wait until Chile's economic problems overtook the UP-those who, in Letelier's words, appeared happy to wait until "fruit ripened and fell from the tree"-were also a growing minority in Washington. And because Letelier predicted that Nixon's widely expected reelection would allow him to pursue a harder line toward Chile, the amba.s.sador called on his government to seize the moment before U.S. presidential elections on 7 November to improve relations with the United States. The Nixon administration would not want to appear to be intervening in Chile before this date, and he also had indications from Washington officials that the United States wanted to sit down and talk.130 So what did Letelier propose that the Chileans should talk about? What is particularly interesting-and surprising-about the proposals that he sent to Almeyda is the sheer scope of issues that he suggested his government could negotiate. Not only did he propose asking for understanding, but he now also suggested Santiago might request a.s.sistance from the United States to help Chile's ailing economy and, by implication, La Via Chilena. In concrete terms, this involved ensuring that Washington cooperated in debt negotiations and modified existing U.S. policy (e.g., by securing agreement from the administration that it would not apply sanctions as stipulated by the Gonzalez Amendment and that it would normalize trade as well as AID and Eximbank credits). It also involved requesting a $50 million credit to help Chile's balance-of-payments problem and a further $50 million for foodstuffs under the United States' PL-480 credits. Moreover, Letelier indicated that the Chileans could not hope to receive this a.s.sistance for nothing. Instead, he proposed that the Chilean government should consider international arbitration to resolve the gridlock with private copper companies, that it should be prepared to pay off the Cerro copper corporation and examine a way of paying Anaconda, that it could offer a moratorium on nationalizing further U.S. investments in Chile, that it could review ITT's case, and that it would commit itself to not accentuating ideological differences with the United States by ensuring that the media under its control did not harden its anti-American posture.131 These were hardly small concessions. In no uncertain terms, Letelier was proposing taking considerable steps backward when it came to a.s.serting Chile's independence vis-a-vis the United States as a means of helping the UP survive.

Unsurprisingly, Letelier's proposals caused immense controversy even when presented to the government in a watered-down and most basic form by Foreign Minister Almeyda. After three long and arduous meetings in September 1972 between the UP's Economic Committee of Ministers and the UP's party leaders, Almeyda wrote to Letelier that the matter was a difficult one and that its "result would at worst end up making conflict [with the United States] even more difficult to resolve." Both the amba.s.sador and Almeyda had always recognized that the task of persuading certain members of the government coalition would be difficult. Furthermore, the PS's leader, Carlos Altamirano, had already voiced opposition to a similar suggestion only months before Letelier formally re-proposed negotiating with the United States in September 1972.132 Now, even though Almeyda had refrained from suggesting that the UP be prepared to compromise on ITT and despite promising that the issue of compensation would be nonnegotiable, Altamirano expressed palpable contempt for negotiations. He vehemently criticized what he called the UP's "bland" policy toward the United States, its failure to denounce Washington, and its lack of preparation when it came to mobilizing Chile's population to face a confrontation with the United States.

Indeed, when it came to Chile's relations with the United States, the government was clearly severed in two. On one side the Communist Party; the Radical Party; Chile's newest economics minister, Carlos Matus; and Gonzalo Martner were among those who agreed that Chile should negotiate meaningfully in good faith even though they were rather pessimistic about what could be achieved. On the other side, execonomics minister Pedro Vuskovic, MAPU, and Altamirano were unsympathetic and opposed to negotiations, fearing that they would force Chile to relinquish its stance on compensation. Allende had to break the deadlock, which he did when he voted to approve negotiations.133 In October 1972 the UP approached talks with the United States through gritted teeth. Need rather than desire pushed it toward such an approach. And rather than Santiago setting the agenda for bilateral discussions as Letelier had hoped, troublesome intragovernmental divisions were holding the Chileans back and attaching heavy weights to the process. As UP officials deliberated, they stalled, and as they did, U.S.-Chilean relations deteriorated even further.134 As predicted, a major reason for this was the Special Copper Tribunal's final decision to uphold Allende's "excess profits" ruling. With it, the atmosphere of crisis in Chile got worse, and Allende's negotiating position weakened as Kennecott halted copper shipments to Europe.

In contrast to the Chileans, the U.S. administration was in a highly advantageous position. Washington did not need the negotiations in the same way as the Chileans did, instead regarding them as being a useful alternative to confrontation-a way of tying Chilean officials into a drawn-out process with no promises of concessions. In September and October, as Letelier had predicted, U.S. officials presented themselves as being highly amenable to starting talks, albeit under their own terms and conditions and safe in the knowledge that their interlocutors needed them more than the United States needed Chile.

Discussions about how to even begin negotiations were slow and tense. In early October, Chile's Foreign Ministry responded to a U.S. note that insisted compensation be a prerequisite for opening bilateral talks by delivering an angry reply filled with frustration and recrimination, more characteristic of Altamirano's stance than Letelier's proposals. Specifically, it underlined Allende's strict adherence to const.i.tutional procedures, rejected any prospect of overturning Allende's "excess profits" ruling (and hence Chilean diplomatic procedures), and accused the Nixon administration explicitly of "economic aggression" and "incomprehension and hostility."135 Indeed, Davis was so worried that the note's language could lead to open confrontation, he secretly (and successfully) begged UP representatives to consider rewording it.136 Ultimately, both Allende and the Nixon administration wanted to avoid open conflict.137 On the U.S. side, this meant lessening the prospect of angering domestic audiences on the eve of an election or alienating international public opinion and Allende's Latin American and Third World sympathizers at the very moment that Washington was trying to extricate itself from the Vietnam War. On the Chilean side, it was about the very survival of La Via Chilena as both an economic and political project. And despite intense opposition to even the prospect of sitting down and opening discussions with the Americans, not to mention growing fears of U.S. intervention in Chile, Allende had fewer and fewer alternatives.

At home, the Chilean government was urgently struggling to retain control of La Via Chilena as a three-week truckers' strike in October paralyzed the country. Although the UP blamed U.S. imperialism for fueling the strike, Washington does not seem to have directed the campaign, which was heterogeneous and, at least initially, not led by the parties the CIA was funding.138 However, the financial support it offered to the private sector (to give it "confidence") was undoubtedly channeled to strikers. Certainly, Santiago became flooded with dollars, and the 40 Committee acknowledged that its a.s.sistance to the private sector was helping to "dramatize" Allende's challenges.139 The strike aside, U.S. diplomats were particularly keen to "reduce friction" between the UP's two leading opposition parties, the National Party and Christian Democrat Party, with a view to improving their chances in Chile's forthcoming congressional elections scheduled for March 1973.140 In this respect, they received promising signs of an evolving two-sided antigovernment front; as one CIA official called it, Chile faced a "good-guys-versus-bad-guys" battle.141 Washington also kept an eye on the military balance of power and escalating violence in the country, although it by no means controlled it. As a member of the Nationalist Party confided to a CIA officer, although it-and, by a.s.sociation and funds, the United States-had "financed and created" the right-wing Patria y Libertad, the paramilitary group had gotten "too big for its britches" and was out of control.142 Meanwhile, as far as the armed forces were concerned, the CIA continued to monitor plotters and had penetrated a group of them but refrained from pushing it toward any action.143 But it was not just the United States that was monitoring the escalating probability of some sort of violent confrontation in the country. In September, the PCCh's leader, Luis Corvalan, had warned the Soviet amba.s.sador in Santiago that a coup was a "real danger."144 In fact, leaders of all political persuasions had been warning of civil war or a military coup for months.145 Speaking to university students at the end of August 1972, Allende had described himself as "horrified" by both prospects. "Although we would win ... and we would have to win" a civil war, he ambiguously proclaimed, the president warned that "generations" would be scarred and Chile's "economy, human coexistence and human respect" would be destroyed.146 Yet students, women, and paramilitary groups had continued to mobilize while sabotage attacks on the country's infrastructure had multiplied.147 Then, during the October strike, factory workers formed what became known as cordones industriales (industrial belts) around cities to maintain Chile's industrial output, to secure control of state-owned properties, and, crucially, to organize their military defense.

Overall, the October strike demonstrated very well how intertwined the UP's economic, political, and military challenges were becoming, even if Allende refused to accept the prospect of armed struggle. The battle to secure international economic a.s.sistance, which Letelier was so preoccupied with as a result of his vantage point in Washington, was also only one of two key factors that would determine Chile's future. And with respect to the second-the ability to resist a violent confrontation with counterrevolutionary forces-the UP was even more divided as to what to do. The Cubans were particularly frustrated with the ill-defined nature of preparations for what they considered to be an inevitable armed confrontation. In a handwritten letter to Allende in September 1972, Castro underscored Cuba's disposition to increase its a.s.sistance and its "willingness to help in any way." "Though we are conscious of the current difficulties faced by Chile's revolutionary process," he wrote, "we are confident you will find the way to overcome these.... You can rely on our full cooperation." Trying to evoke the image of Allende as a military commander, Castro signed off by sending the Chilean president a "fraternal and revolutionary salute."148 When Allende ended the truckers' strike by bringing the armed forces into government, he also took a huge risk in politicizing military leaders and making their cooperation central to La Via Chilena's survival. As the general secretary of the PCCh would later tell East Germany's leader, Erich Honecker, the decision was first and foremost Allende's although the Communist Party had to help him resist strong criticism of such a move from the PS. As a result of the move, however, Corvalan recounted Allende as being "optimistic" about the future and the prospect that the UP's parties would do well in the March 1973 elections.149 In many respects, this move nevertheless ended the Chilean road to socialism and began the road to militarism.150 By this stage, those within the PS's military apparatus had appreciated that coup-minded military leaders-golpistas-were influenced and inspired by their contemporaries in Brazil.151 To be sure, the golpistas increasingly believed the military had a vital role to play in defending Chile against Marxism and that political parties could ultimately only slow down the installation of a Marxist dictatorship, whereas the military could stop it altogether. Certainly, the leader of coup plotting in mid-1972, General Alfredo Ca.n.a.les, also subscribed to this idea, which was enshrined in the National Security Doctrine that Brazil's military leaders adhered to. However, left-wing Chileans later admitted that the UP as a whole did not spend time studying the nature of thinking within military circles or the Chileanization of inter-American trends.152 Moreover, far Left groups of Chileans and the Cubans, both of which were closely monitoring the growing threat of a possible coup, seem to have failed to grasp the extent-or even the relevance-of Brazil's direct interest in, symbolism for, or relations with Chile's armed forces.153 Chile, after all, was different, with the majority of the armed forces still considered to be const.i.tutionally minded defenders of Chilean democracy.

However, Chile's uniqueness was becoming increasingly blurred. Just as Chilean events had intensified the inter-American Cold War in the Southern Cone in 1970, regional developments were now spilling over into Chile. The UP's relationship with revolutionary movements beyond its borders was, on at least one occasion, diplomatically unhelpful. On 15 August 1972, Argentine political prisoners belonging to the Ejercito Revolucionario del Pueblo (Revolutionary Army of the People, or ERP) broke out of the "Rawson" jail in Chubut, Argentina's southern province. Having made it to Trelew airport, they commandeered an Austral BAC 111 flight that had landed from Buenos Aires with ninety-two pa.s.sengers on board and demanded that it fly them to Chile, where they then requested asylum.154 This provided the UP's opposition with evidence of links to "foreign extremism" and, in addition, temporarily damaged Allende's working relationship with Argentina when he resolved the crisis by sending the prisoners to Cuba.155 More broadly, as the last remaining safe haven for the Left in the Southern Cone, Chile was increasingly becoming a destination of curiosity, refuge, and solidarity for revolutionaries around the region. Reliable evidence also suggests that, in some cases, Latin American revolutionaries received armed training in Chilean camps.156 By the end of 1972, there were Uruguayan Tupamaros and approximately one thousand Brazilian left-wing exiles in Chile.157 In late 1972, the MIR's leader, Miguel Enriquez, convened an ultrasecret meeting in southern Chile of the MIR, the Chilean branch of the ELN, the ERP, and the Tupamaros to discuss working together toward mutual revolutionary objectives. Primarily, the group, which would become known as the Junta Coordinadora Revolucionaria a year later, focused on how to respond to the counterrevolutionary offensive it faced so as to conserve forces for a future offensive of its own.158 It is unclear whether Allende had any knowledge of this, and from what we know of his relationship with the MIR by this point, he certainly would not have approved of its role in acting outside the UP in this way. Yet he did personally know and meet Latin American revolutionary leaders while serving as president, including Tupamaro leaders who joined his intimate Chilean and Cuban friends for weekends at "El Canaveral," La Paya's weekend home.159 Indeed, however exaggerated it might have been, the opposition's mantra that accused Allende of letting foreign revolutionaries into the country was not without some basis. Chile was increasingly becoming a theater of the inter-American Cold War on whose stage a whole cast of actors from the Southern Cone, the United States, Cuba, the Soviet Union (though far less so), and Europe (both East and West) a.s.sumed positions against each other and as sponsors of their divided Chilean allies. On one level, Frei warned the U.S. amba.s.sador in Santiago about the "growth and arming of Socialist, Communist and Left extremist paramilitary brigades" and claimed that "Bolivian exiles, Cubans, Eastern Europeans and other leftist foreigners" were working for Chile's intelligence services.160 On another level, the Cubans insisted that Allende had to take greater stock of the military balance of power within the country (and admit the necessity of bringing the militarily more prepared MIR on board to defend Allende's presidency) to counteract a foreign-backed plot to overthrow him.

Ultimately, as the Chilean doc.u.mentary maker Patricio Guzman noted in his film of the same name, the October strike was the start of a decisive "Battle for Chile" that would end on 11 September 1973. The international dimensions of that battle, to date not fully understood, helped determine how it would develop, complementing, sponsoring, or inspiring the Chileans at the center of the story. As the United States funneled covert support to Allende's opposition parties, Brazil's military regime provided a model for golpistas within the armed forces, the Soviet Union stood on the sidelines reluctant to help the Communist Party solve Chile's economic woes, and Havana continued to urge Allende to contemplate how he would militarily defend his government in the event of a coup. As he listened to this conflicting advice, Allende managed to regain control of the country by resolving the strike and relying on the military's inst.i.tutional support. Yet, as his former economics minister Pedro Vuskovic remarked, "the problem of power" remained "unresolved."161 This was not merely a question of the government's "power" vis-a-vis the opposition but rather of who was ultimately going to be in control of Chile's revolutionary process. And as the government's painstaking deliberations about how to approach the United States demonstrate, the UP coalition that had brought Allende to the presidency was unraveling. Given these circ.u.mstances, the president decided it was time for him to take matters into his own hands.

Conclusion.

The international environment that Allende encountered two years after he a.s.sumed the presidency was unhelpful. By this point, the Chilean government acknowledged that detente did not apply to Latin America and that the United States still had ideological prejudices when it came to dealing with the region. As Letelier wrote to Almeyda, "It is ... not a mystery that the White House's preferences lie with the governments that favor private investment and attack any 'Marxist' shoot. The cases of Brazil and Mexico ... do not need more commentary." When asked for an a.n.a.lysis of the approach to Latin America that a second Nixon administration might take, Letelier concluded: The current administration has been characterized by the practical thaw regarding certain socialist nations. This could be interpreted as a favorable signal for Chile, if the White House's policies toward Yugoslavia or Romania were applicable to Latin America. However, the result of the election in Chile in September 1970 notably displeased Nixon. Dr Kissinger's declarations about the "domino theory" for Latin America (September 1970), the absence of a protocol greeting to President Allende and the president's own declarations that the new Chilean government "was not to his liking" but that "he accepted it" as a matter of respect for the Chilean people's will, reveal serious and profoundly different reservations from what can be found with other socialist nations located outside the continent.162 Although the Nixon administration was caught up in the high-level diplomacy of detente during 1972, this did not mean Washington ignored the hemisphere. The U.S. president was star-struck by his summit meetings with Mao and Brezhnev and, as we now know from the Nixon White House tapes, condescending toward Latin America's "importance" in this context.163 Yet, he remained preoccupied with fighting the Cold War in the region, and U.S. policy makers continued to be concerned about how events south of their borders affected the United States' credibility as a superpower and the strength of its ideological convictions. As Connally had reported to Medici, Nixon "was hopeful that a long period of peace could be achieved as long as the United States remained strong and had the support of the countries of the free world such as Brazil."164 Indeed, global politics may have been shifting away from the certainties of an earlier bipolar Cold War era, but this did not mean Nixon and Kissinger were willing to relinquish control. Thus, when Nixon urged the Mexican president to let his message triumph above Castro's in Latin America, he hoped not only that this would help ward off the "poison" of Chilean and Cuban influence but that his counterpart would contribute to spreading U.S. ideals of capitalist economic progress and its prescriptions of order in the hemisphere.

In return, Echeverria urged the U.S. president "for a whole new shaping or recasting of American policy vis-a-vis Latin America."165 President Misael Pastrana of Colombia also urged the United States to "pay greater attention to [the] underdeveloped world and demonstrate less apathy toward Latin America" when he had met Connally in June.166 In fact, beyond Allende and Castro, others clearly worried about the drift in the United States' commitment to regional development. What is more, by the late 1960s and early 1970s economic nationalists on the left and right viewed security not only in terms of external strategic threats but also increasingly in terms of economic stability. In this respect, many of the hemisphere's armed forces increasingly regarded themselves as needing to play a key role in politics because, for them, defending their countries was a geo-economic as well as a traditionally geostrategic question.167 Within Chile, this was also the case, especially as there was an obvious contradiction between the claims of a government that purported to be bringing independence and sovereignty and the reality of growing indications that the UP was leading Chile to precarious dependency on external sources of funding.

Although Allende's message had inspired other nations in the global South, the UP's unique socialist democratic experiment therefore found itself increasingly out on a limb in late 1972. As UNCTAD's former secretary Gamani Corea noted, the organization's Third World members were ultimately more concerned with links to industrial nations in the East and West than with global bodies as a means of accelerating their countries' development.168 And while other nationalists defaulted to traditional vertical patterns of trade and aid, reaping the benefits of the United States' growing efforts to work out bilateral solutions with key countries, this denied Allende the commonality of purpose and solidarity he sought in pursuit of his revolutionary aims.

Meanwhile, Chilean boldness in 1972 reaffirmed the Nixon administration's belief that Allende was anti-American, economically dangerous, and ideologically repellent. For Washington, then, bilateral U.S.-Chilean negotiations were purely pragmatic. Fighting for victory meant employing tactical retreat, and by this point Washington-as well as Santiago-was clear that it did not want a painful divorce that would undercut its ultimate objectives. For now, Allende stood at a crossroads of success, survival, failure, and disaster, and the UP had yet to prove that La Via Chilena was a viable revolutionary process or adjust Chile's position more effectively to global realities.

Looking to the year ahead, Chile's population would have the chance to deliver its verdict on the government in congressional elections scheduled for March. If the UP's parties were going to do well, they had to improve the country's economic situation, but this was a tall order given the rapid nature of Chile's economic decline. In November it was expected that Chile's deficit would reach $430 million by the end of the year. And, by Letelier's calculations, if the economy was to function relatively normally, the UP needed to raise at least $100 million by January and a further $400 million or more during the course of 1973.169 Would bilateral negotiations with the United States be enough? Clearly, Allende thought not. Indeed, in a dramatic gesture, he was preparing to leave Chile in search of an international cure for his beleaguered presidency.

6.

CROSSROADS.

Incomprehension and Dead Ends, November 1972July 1973.

In late November 1972 Salvador Allende set off on an international tour that took him from Mexico City to Havana via New York, Algiers, and Moscow. In many respects, the trip was a gamble-a somewhat uncoordinated effort both to improve Chile's position before its representatives sat down to bilateral negotiations with the United States in December and to boost the UP parties' chances in Chile's forthcoming congressional elections. The journey also encapsulated the different strands of Chilean foreign policy, which since 1970 had aimed to protect La Via Chilena and to promote systemic change on behalf of the global South. During his trip, Allende simultaneously appealed to Latin Americans, the Third World, the UN, the Soviet Union, Cuban revolutionaries, and, at least indirectly, the Nixon administration. His country's experience, he told the United Nations General a.s.sembly, was the epitome of a justified battle against imperialism for "social liberation, the struggle for well-being and intellectual progress, and the defense of national ident.i.ty and dignity."1 The problem was that Allende was now clearly losing this battle. Nixon's antic.i.p.ated and triumphant reelection as president of the United States offered no relief to U.S. pressure against his government. Two years after his inauguration, Chile also appeared to be an example of ineluctable dependency and an unworkable road to socialism rather than an alternative road to development or a shining beacon of independence and peaceful revolution. Given this predicament, the Chilean president was not running rings around Uncle Sam as depicted in a Cuban cartoon at the time; he and his divided government were struggling to prevent a net closing in on his presidency by acting on several different fronts at the same time. Chile's foreign policy, it seemed, was now increasingly subsumed in a struggle to acquire financial a.s.sistance.

The key questions were how, from whom, and how much. On the eve of Allende's international tour, the Chilean amba.s.sador at the United Nations tried to warn his U.S. counterpart that the whole of Latin America was expectantly watching the evolution of relations between Washington and Santiago as a test of whether Nixon would work out a relationship with the region comparable to the "excellent" ones it now had with the Soviet Union, China, and Western Europe.2 As far as the Nixon administration was concerned, however, Allende no longer posed the threat he had once appeared to. Since 1970, the revolutionary tide that had seemed poised to wash over the Southern Cone had ebbed and, with it, Chile's potential impact on the inter-American balance of power had diminished. Furthermore, Washington's intelligence a.n.a.lysts were relatively relaxed about Allende's trip in late 1972, believing that the Soviets were now rather unlikely to bail the UP out of its deteriorating economic predicament and that the Chilean president was unlikely to achieve any miracle cures for the economic and political crisis facing the UP.3 At least some within the UP nevertheless still held out hope that Moscow would substantially help solve their economic woes. And in an effort to try and persuade the Soviets to rethink their reticence to help Chile, Allende's tone changed. Acknowledging that efforts to avoid Cold War categorizations had failed to obtain more support from the superpowers in an age of detente, Santiago now tried a bit of reverse psychology: it tried to play a Cold War game at a global level to induce the Soviet bloc to help. In Washington Chilean diplomats therefore tried to suggest that Allende was on the verge of being pushed to the East, whereas in Moscow Allende explicitly depicted Chile's experience as a new Cold War battlefield. Indeed, borrowing Pablo Neruda's phrase at the time, he called his country a "silent Vietnam."4 Yet his rhetoric did not fit the times. By the end of 1972, the Soviets' priority was reducing tensions with the United States as the Vietnam War drew to a close, not beginning another similar international conflict. Moscow's own economic problems and increasing financial commitment to Cuba after mid-1972 meant that it was also not prepared (or able) to bankroll the Chilean economy. Moreover, for at least six months, the USSR's leaders had increasingly been viewing La Via Chilena as a lesson of what could go wrong in a revolutionary process rather than a good investment in a global battle against capitalism. In the end, Allende thus returned to Chile disappointed, becoming ever more reliant on negotiation with the United States as a means of solving his economic ills.

In fact, all the while that Allende was touring foreign capitals, the Chilean Foreign Ministry had been preparing for bilateral talks with the United States, which began in December and dragged on without any decisive end in sight. And, as such, Washington was becoming far more central to Chile than Allende had ever hoped it would be. While the Nixon administration refused to countenance any financial settlement with Santiago to ease its balance-of-payments deficit, it also continued to exacerbate the UP's challenges back home, actively subverting the democratic process, encouraging Allende's parliamentary opposition, and sympathizing with military plotters.

Although in this respect, U.S.-Chilean bilateral negotiations seem to have been rather hopeless endeavors, they are intriguing insofar as they provided s.p.a.ce for both sides to articulate the reasons why they opposed each other. As negotiators ostensibly fenced over questions of compensation and debt, the underlying obstacles to mutual understanding and progress surfaced. The Chilean government and the Nixon administration quite simply disagreed about the merits of capitalism and the world economic system. While U.S. officials plainly told Santiago's representatives that they had developed the best political and economic system worldwide, the Chileans told them that although they were committed democrats, they had this wrong. Consequently, although U.S. and Soviet or Chinese leaders had agreed to disagree across the Pacific, the Americans and the Chileans were still trying to explain their differences to each other.

Playing for Time and Sympathy.

In the weeks before Allende left Chile, his forthcoming venture had divided his already splintered government. Exactly what the trip would achieve appeared uncertain. Chilean diplomats argued about the effect it could have on relations with the United States, where Nixon had now been emboldened by his recent reelection; they questioned which visits would reap the maximum benefit, East to West or West to East; and they debated what, if any, impact the trip would have on Chilean domestic politics. To a large degree, the answers to these questions depended on differing a.s.sessments of how Allende would get on in Moscow. There were some within the UP who clearly believed the president's mere presence in the USSR would cause the Soviets to leap into action and relieve Santiago of its dependency on resolving its problems with the United States. Yet Orlando Letelier, who unsurprisingly remained focused on the pivotal nature of Chile's relationship with the United States, was more skeptical. Even if the USSR suddenly offered Chile substantial a.s.sistance, he warned Foreign Minister Almeyda, this would not be enough to cover the country's balance-of-payments deficits.

He also had good reason to doubt the Soviets' receptiveness to old-fashioned Cold War arguments. Writing to Foreign Minister Almeyda just over two weeks before Allende left Chile, the amba.s.sador relayed an interesting two-hour conversation he had just had with his Soviet counterpart in Washington, Anatoly Dobrynin. The latter, it seems, had requested the meeting and then "insistently" conveyed the USSR's desire to avoid a confrontation with the United States in what was a "new era of international relations." As Letelier surmised, the message had not been "accidental," occurring as it did in the midst of Allende's preparations to visit Moscow.5 This was just one of the key issues that arose in a flurry of diplomatic correspondence between Santiago and the Chilean Emba.s.sy in Washington during early November. Indeed, the frantic arrangements and disagreements between Allende's advisers on the eve of his trip underlined the UP's ongoing lack of coordinated thinking on foreign policy matters (as well as the lack of presidential direction). As Letelier lamented, he simply did not understand the "philosophy" behind the president's trip and was unsure what purpose it would serve in terms of both Chile's foreign relations and its domestic political context. To be sure, he thought the UN would make a very good "tribunal," which could be used to put pressure on the United States. Yet without any firm consensus in Santiago about whether the UP wanted to confront the United States or negotiate with it, or, indeed, any indication of what the Soviets might offer, it was hard to decide what message Allende should convey. Would it not be easier for the president to go to the Soviet Union first, Letelier asked, so that he would then be able to "calibrate" his UN speech accordingly?

The other pressing issue dominating Chilean diplomatic preparations in the first few weeks of November was whether Allende should take advantage of his visit to New York to seek a meeting with Nixon. Clearly, the message from the Foreign Ministry in Santiago was to try and organize a summit, hoping that it would "impel" a new type of dialogue with the United States. But, as Letelier reminded Almeyda, the prospect was meaningless unless the UP agreed on precisely what the Chileans would bring to the table.6 In the end, it seems that the foreign minister chose to ignore much of this advice when he instructed Letelier to meet with U.S. amba.s.sador Davis during his brief visit to Chile later that month. Not only was Allende due to travel to Moscow after New York, but the Chileans had clearly also decided to gamble on trying to arrange a meeting with Nixon. When the Chilean amba.s.sador met Davis during his stay in Santiago, he thus told him that the United States and Chile had reached a "crossroads" and that a meeting between Nixon and Allende was a "last chance" to defuse bilateral tensions before relations soured further and Santiago turned East. If Letelier was privately unconvinced by the message he delivered, Davis was unimpressed. He wrote to Secretary of State Rogers that Chile appeared to be playing a misguided Cold War game and offering only "formulas of contact"-"The present Chilean effort has overtones of stage-setting for a repet.i.tion of the myth of Castro's 1959 visit to Washington," he argued. "We are already aware of the ... concept of the 'the last chance' before Chile turns to the East. There is some truth in Letelier's allegation that this trip will be seen as a shift to the socialist camp. He also is probably right when he says it will make things harder. It is sad that the Chilean govt has structured it that way if not with care at least with weeks of tinkling cymbals."7 What Letelier did not know was that the State Department had already unequivocally rejected a summit two weeks before he even approached Davis on the grounds that such a meeting would only raise Allende's profile.8 The department's Bureau of Intelligence and Research concluded that the Chilean president was most likely only trying to attract international sympathy as a "useful backdrop" to prescheduled bilateral talks in December rather than offering anything substantially new. Allende also apparently wanted to improve his chances of renegotiating Chile's debt by shifting "blame" for his economic performance onto "imperialist aggressors."9 In this context, the administration therefore pressured news agencies to avoid interviewing him.10 Despite the Nixon administration's best efforts, however, Allende's speech to the UN General a.s.sembly on 4 December resonated worldwide. According to U.S. news reports, he received a standing ovation similar to those received by the pope and President John Kennedy.11 During a televised press conference in Mexico before arriving in New York, Allende had promised his speech would be a "call for moral force against injustice similar to the moral effect of calls to end [the] 'Vietnam genocide.'"12 And once at the UN, he delivered a compelling performance, appealing to the "conscience of the world" and publicizing Chile's "financial strangulation." Allende also detailed the "perversion" of international agencies (being used as individual states' "tools") and denounced multinational corporations that drove "tentacles deep" into sovereign countries while earning obscene profits from the Third World ($1,013 million from Latin America, $280 million from Africa, $366 million from the Far East, and $64 million from the Middle East). Chile's problems were part of "a long and ominous history in Latin America" of "imperialism and its cruelties," Allende insisted. "Ours is not an isolated or unique problem: it is simply the local manifestation of a reality that goes beyond our frontiers and takes in the Latin American continent and the whole Third World. In varying degrees of intensity and with individual differences, all the peripheral countries are exposed to something of this kind ... imperialism exists because underdevelopment exists; underdevelopment exists because imperialism exists."13 In keeping with the idea of using the UN as a "tribunal," Allende also made a case for his defense. He explained that Chile had been "forced" to adopt a new development model to solve poverty, inequality, and dependency. And he justified his "excess profits" ruling by citing international law and detailing the profits private companies had accrued. He did not explicitly denounce the United States by name, although he proclaimed that Vietnam had "taught the world that the abuse of power saps the moral fiber of the county that misuses it ... whereas a people defending its independence can be raised to heroic heights by its convictions."14 The Nixon administration was affronted by, and unsurprisingly unsympathetic to, Allende's speech. At a last-minute meeting at the Waldorf Hotel between Allende and the U.S. amba.s.sador at the UN, George H. W. Bush, the latter tore Allende's arguments apart. "I told him that we did not consider ourselves 'imperialists' and that we still had a deep conviction that our free enterprise system was not selfish but was the best system-certainly for us, though we had no intention to insist on it for others," Bush recorded. He also told Allende that, although there had been "excesses from time to time," this system did not "bleed" people when it went abroad; "it was the best way to provide a better standard of living for all." Bush then rejected Chile's tactical attempts to distinguish between the U.S. government, U.S. companies, and U.S. people. Owing to a "deep conviction in the free enterprise system," he told Allende, "the people, the government and the system" were "interlocked."15 If the Chilean president had any hopes of persuading U.S. officials of the merits of his argument or pressuring them into making concessions with his speech, he must have walked away with his hopes shattered.

After leaving New York, Allende stopped, on his way to Moscow, in Algeria, where he met President Houari Boumedienne. Yet, here too, Allende received warning signals. As well as exchanging views on Third World issues, the Algerian president pointedly asked what the situation was inside Chile's armed forces. As Almeyda later recounted, Boumedienne was unconvinced by the notion of const.i.tutionality among Chilean military leaders. Apologizing for his frankness, he ominously argued that the UP's political experiment would fail if it did not stamp out all counterrevolutionary vestiges in its military inst.i.tutions.16 Salvador Allende at the United Nations General a.s.sembly, December 1972. Courtesy of Fundacion Salvador Allende.

When Allende took off from Algiers for Moscow, he was still unsure what he would achieve. Two weeks earlier, the PCCh's secretary-general, Luis Corvalan, had traveled to East Germany and Moscow to discuss future a.s.sistance to the UP. On route, the president had sent this pro-Soviet leader with years of good relations with Moscow to Havana to consult the Cubans on how to deal with Moscow. One of the Cubans who attended the meeting recalls that Castro was concerned about the Chilean's lack of detailed technical knowledge to win over the Soviets. In fact, drawing on his own experience in dealing with Moscow, Castro quizzed Corvalan on his figures for hours and had concluded he knew more about Chile's economic situation than the Chilean sitting in front of him.17 Be that as it may, one of the essential problems that Corvalan encountered in Berlin and Moscow was that, as Dobrynin had indicated to Letelier, the Soviet Union did not want to risk a confrontation with the United States by getting too involved in Chile. In Moscow, Corvalan had lengthy meetings with Brezhnev and other senior leaders of the Soviet Communist Party. Then, in a long meeting with East Germany's leader, Erich Honecker, on 24 November, Corvalan outlined Chile's problems, citing the growing strength of "united internal and reactionary forces," a deficit of $200 million, and the omnipresent threat of U.S. imperialism. As he stressed, Washington was challenging the UP in the form of the withdrawal of U.S. technicians and credits, the ITT conspiracy, and embargoes against Chilean copper sales. To be sure, the UP had survived the October strike, but 1973, in his words, was going to be "the most decisive year for Chile ... the year when decisions will be carried out that will determine our path to socialism." Looking ahead, he also acknowledged that the Chileans would obviously have to make the biggest sacrifice to withstand challenges to La Via Chilena (he mentioned b.u.t.ter and meat rationing as an example of savings already being made), but they could not do so successfully without "international a.s.sistance." In this respect, he recognized that his proposals for substantial increases in Soviet bloc aid were "not easy," but he said it was his "revolutionary duty to be open and honest" about what was needed.

After hearing the details of Corvalan's specific suggestions for Soviet bloc purchases of Chilean copper (that he recognized could not be sold on the international market owing to embargoes against it but which could be used for reserves), a $220 million investment in steel production, and large short-term credits to offset a predicted Chilean deficit until 1976, Honecker responded in a sympathetic but noncommittal manner. On the one hand, he pointed out that the German Democratic Republic already had to juggle previous commitments to aid other revolutionary processes, not least $100 million a year to North Vietnam. He also ignored Corvalan's efforts to single Chile out as a far better investment opportunity than Cuba. On the other hand, he also raised the issue of East Germany's own deficit and foreign debts, and the problematic nature of internal discussions about how to deal with these in the year ahead. Promising Corvalan he would look into how Berlin might be able to offer more help to the Chileans, he left specific answers to the Chilean's suggestions hanging in the air, noting only that he would send his views on to Moscow before Allende's arrival.18 Meanwhile, Soviet leaders were divided. The KGB had a grim view of the situation in Chile, while the Soviet Communist Party's ideologues were in favor of helping to consolidate the UP's revolutionary road. As the Russian historian Olga Ulianova has argued, it would seem that Moscow ultimately declined to help more because it both lacked faith in Allende's project and was financially unable to commit to a new Cuba.19 However, the Chilean president did not know this when he arrived in the USSR. In an effort to raise the stakes of not helping Chile, Allende put forward the idea of his country being a "silent Vietnam"-"without the roar of airplanes or grenade explosions"-at a Kremlin banquet thrown in his honor.20 But despite ample quant.i.ties of vodka to wash down disappointments, the visit fell short of Chilean hopes. Allende's cardiologist, Oscar Soto, recalled that his boss was "not happy at all." In his Kremlin suite, he commented loudly to any of the walls that were listening that he would leave Moscow early if he did not receive more positive signals of Soviet a.s.sistance soon; "the Soviet companeros don't understand us!" he complained to Soto.21 He was right. Moscow did not need Chilean copper and could not comprehend the UP's chaotic management of its economy or its failure to use previous Soviet credits granted to Chilean industrial development.22 Salvador Allende in Moscow, December 1972. Front row, left to right: Luis Corvalan, Alexei Kosygin, Allende, Leonid Brezhnev, and Nikolai Podgorny. Courtesy of Fundacion Salvador Allende.

Rather than receiving enough to counter Chile's foreign exchange deficit for 1973, Allende left with advice to resolve conflicts with Washington and promises of economic a.s.sistance that fell far short of hopes. Instead of larger hard currency loans, for example, the Chileans received a new credit of $45 million and agreements using previously agreed credits to increase the USSR's technical a.s.sistance in developing Chile's copper, chemical, and fishing industries. Yet Santiago did not want Soviet technology, which it considered as being incompatible with Chile's U.S.-orientated industry.23 And Allende also felt betrayed. "I never imagined that they would do this to me," he lamented to the Chilean diplomat Ramon Huidobro, who vividly recalled the Chilean president describing himself as having been stabbed in the back.24 The reception and ma.s.s adulation that Allende received when he arrived in Havana could not have been more different from the reception he had had in Moscow.25 Castro had been pleading with Allende to visit for a whole year. Back in February 1972, shortly after his own visit to Chile, he had written to Allende about this idea: I can understand perfectly well that the intense work ahead of you and the tone of the political struggle in recent weeks have not allowed you to schedule the trip.... It is clear we had not taken these eventualities into account [when we talked about it]. That day, on the eve of my return to Cuba, when we dined in your house in the early morning hours, having little time and in the haste of the moment, it was rea.s.suring for me to think that we would again meet in Cuba, where we would have the opportunity to converse at length. Nevertheless, I still harbor the hope that you can consider scheduling your visit for some time before May. I mention this month because, mid-May, at the latest, I must make a trip, which can no longer be postponed, to Algiers, Guinea, Bulgaria, other countries and the Soviet Union. This long tour will demand considerable time.26 Of course, Fidel had gone on his trip, and Allende's visit had been postponed yet again. However, when the two leaders finally met just over a year after Castro left Chile, they addressed what the Chilean charge d'affaires in Havana enthusiastically recorded as an "incalculable magnitude" gathered at the Plaza de la Revolucion.27 Castro welcomed Allende as a leader who had shown Cuba the "most steadfast friendship" since 1959. He also likened the imperialist aggression Chile faced to the situation that Havana had encountered (even if he underscored that his country's experience had been far worse). "We [have] lived that experience and know about the reserves of energy, self-denial and heroism that exist in the people," Fidel knowingly explained. But he also warned that "revolutions do not emerge as a whim of men but as the result of historical processes," insinuating that Allende would not be able to dodge a cla.s.s struggle and a confrontation with counterrevolutionaries. Castro finished with pledging Cuban "blood," "bread," and forty tons of the Cuban population's sugar rations to help Chile's revolution. "We must launch a gigantic wave of solidarity around the brother Chilean people," he instructed, explaining what the imperialists had "tried to accomplish with bombs in Vietnam they are trying to accomplish in Chile by economic asphyxia."28 Allende had finally got the recognition of his country's international significance that he desired, and thousands cheered in support.29 Yet he was also uncomfortable. Before stepping up to the podium in his Cuban Guayabera shirt, his doctor observed his boss more nervous than he had ever seen him. The Chilean president, it seemed, was intimidated by speaking in this setting after Fidel.30 When he did, Allende paid tribute to Cuba's revolutionary martyrs and the historic ties between Chile and Cuba. He thanked the Cuban people profusely, lambasted those who attacked his revolution, and expressed grat.i.tude for the Order of Jose Marti President Dorticos had awarded him earlier that day.31 As Chile's charge d'affaires, Gonazlo Rojas Pizarro, proudly noted, the speech "showed the unquestionable personality of an American combatant and an authentic Marxist-Leninist."32 Even so, Cuba's understanding brought limited help. Moreover, sugar and blood could not solve the UP's immediate economic problems, which were even causing problems for Havana and Santiago's bilateral relationship. In November 1972 Castro had personally complained to Corvalan that he was unhappy with Chilean delays in fulfilling trade agreements.33 While Cubans were insistent on moving the pace of negotiations forward, the UP lagged behind, and the Cubans also voiced concerns that Chilean firms were not selling products at a compet.i.tive rate to Havana.34 Indeed, in this case the earlier celebrated idea that these two developing countries could work together to solve problems of development seemed increasingly untenable.35 Back in Santiago, there was no consensus about what Allende's trip had achieved. The main focus of press speculation was on whether the USSR might possibly help Chile more than official communiques had suggested. As the U.S. amba.s.sador in Santiago noted, the UP may have been "gratified at [the] warmth, enthusiasm and respectful hearing Allende's 'David and Goliath' portrayal seem[ed] to be eliciting abroad," but most of Allende's UN speech was "old hat to Chileans," and he reported that nothing "noteworthy" had come out of the president's visit to Havana.36 Fidel Castro and Salvador Allende in Cuba, December 1972. Courtesy of Fundacion Salvador Allende.

Allende was thus back to square one-namely, to working out his country's differences with the United States. Looking ahead to Chile's bilateral negotiations with the United States, the Chilean Foreign Ministry continued to define the country's overall strategy as being an effort to "win time" and "manage conflict," while simultaneously consolidating Chile's revolutionary process. If it could, diplomats also hoped to "induce a change" in the United States' rigid position on compensation by trying to move discussion toward broader political issues.37 As the Chilean negotiators who arrived in Washington argued, Nixon's reelection in November 1972 meant they would have to "live with each other" at least until Chile's presidential elections in 1976, so it was time to reach some sort of understanding.38 By the end of 1972, the UP's odds of exerting enough leverage on Washington to induce it to change its credit restrictions nevertheless seemed slim. Although Allende had never wanted to ally himself wholeheartedly with the USSR, economic necessities had driven him to seek solutions to the UP's problems in Moscow. The advice he received to resolve Chile's dispute with the United States was consistent with the UP's own continuing efforts and thus offered nothing substantially new to hold on to. In fact, rather than increasing economic a.s.sistance to Chile, the Soviet Union would actually reduce it from a total of $144 million in 1972 to $63 million in 1973.39 From the end of 1972 onward, Chilean approaches toward the United States therefore const.i.tuted an increasingly pivotal-albeit haphazard-process. Indeed, successive last-minute efforts to delay a showdown merely sought to "play for time" as Allende's options diminished.

"Slowing Down the Socialization of Chile"

The CIA defined its overall task in 1973 as "slowing down the socialization of Chile."40 And while U.S. policy makers stalled negotiations, Washington subverted Chile's democratic process. Chile's forthcoming congressional elections were widely considered as having the power to decide whether Chile's future would be shaped by democracy, dictatorship (on the left or the right), or a civil war. But Allende's UN speech and international grandstanding had raised the profile of Washington's role in Chile, increasing the risks that intervention posed. Congressional investigations in Washington about ITT's relationship with Nixon's administration and the growing Watergate saga (with its possible link to the Chilean Emba.s.sy break-in) also raised awkward questions about the White House's covert operations. Therefore, when the outcome of the March elections led those who opposed Allende to desperate measures, the costs Washington faced by intervening rose. Henceforth, U.S. policy makers were unsure how to speed up Allende's downfall without offering the UP a pretext to hypothetically seize authoritarian control.

The Nixon administration obviously had no intention of making bilateral negotiations with Chile easy. After all, its hesitant agreement to enter into them in the first place had hinged on avoiding a confrontation with an internationally prominent Third World leader, denying Allende a role as a scapegoat, and gaining compensation for copper companies (considered to be a remote possibility). The Nixon administration also clearly doubted Chile's sincerity. As Rogers had advised Nixon in November 1972, he saw "no evidence" Allende was "prepared to offer meaningful concessions" or that hard-liners in his coalition would let him act on these if he did.41 The United States therefore entered bilateral talks pessimistically, armed with "Article 4," the clause it had inserted into the Paris Club agreement explicitly linking compensation to any "normalization" of U.S.-Chilean economic relations.

When delegates met on 20 December, a.s.sistant Secretary Charles Meyer opened proceedings by thanking the Chileans for having brought "spring to Washington" on account of Washington's unusually warm weather. Yet the temperature inside the negotiating room dropped over the next two days when both sides failed to map out a method of resolving disputes, let alone making progress toward solving them. Although each side promised to "leave ideology aside," this belied what the disagreements were about. As Letelier himself acknowledged, differences revolved around contradictory "conceptual" approaches to economic development and international relations. More specifically, the Chilean delegation a.s.sumed an uncompromising initial stance, insisting that the United States ease its discriminatory economic policies and underlining Allende's unwillingness to rewrite Chile's const.i.tution to overturn his "excess profits" ruling. All the while, U.S. delegates nonetheless maintained that the "stone" blocking progress was Chile's refusal to pay compensation.42 Then, on the last day of discussions, the Chileans proposed submitting all disputes to unbinding arbitration along the lines of an unearthed bilateral treaty from 1914. But with Christmas festivities looming, delegates suspended talks until the New Year.43 After these talks, Allende gathered Letelier, Almeyda, UP party leaders, and legal experts in Santiago to discuss options. In focusing on the 1914 treaty, policy makers reasoned that it offered an unbinding framework that could comprise a range of topics instead of compensation alone. They regarded such a framework as an unlikely means of "solving" the conflicts, but a useful means of ensuring disputes would not overshadow Chile's wider international relations, especially with a new round of Paris Club negotiations scheduled for January. Another advantage of the treaty, the Foreign Ministry noted, was that it placed the United States in the position of defendant, thus turning the tide on the balance of legal cases against Chile. By formulating arguments based on international law, Santiago thereby hoped to receive backing from Third World countries in similar situations.44 In the meantime, the abortive meeting in Washington offered Santiago short-term gains. When Chilean diplomats arrived in Paris for a new round of debt negotiations, they noted that it had produced a "positive climate" that helped disarm U.S. obstruction to a favorable deal. When the Paris Club also decided to suspend any decision pending an International Monetary Fund report on Chile's economy, this eased imm