270. Intelligence Note From the Director of the Bureau of Intelligence and Research (Hughes) to Secretary of State Rusk 1

SUBJECT

  • Frei’s Victory in Chile has Broad Hemispheric Significance

A new dimension to democratic left. For the first time in Latin America, a Christian Democratic Party has achieved power. These parties, which are beginning to gain a foothold in several Latin American countries, are outspokenly pro-Western in foreign policy. In domestic policy, they advocate a middle road between capitalism and Marxism with strong emphasis on the role of the working man. The Communists and particularly the Castro regime have watched the Christian Democratic parties with concern, fearing that their advocacy of revolutionary changes with freedom might attract majority support. Frei’s victory confirms their fears.

Smooth transfer of power foreseen. Frei will lose no time in designating the officials of his government. In staffing the ministries he will be able to call upon some of the most able technicians in the present Alessandri government who are members of his party. Outstanding among these is Sergio Molina, Director of the Budget and coordinator of Chile’s 10-year development program, adopted in 1961. Foreign Office undersecretary, PDC member Enrique Bernstein seems likely to become the new Foreign Minister.2 The PDC lacks enough top caliber technicians and administrators, however, to fill all the government’s top posts and it will probably turn to political independents.

Congressional hurdle. Frei must now buttress his personal victory— the first majority obtained by any Chilean presidential candidate since 1942—with greater representation of his party in Congress where it has only 32 out of a 192-seat total. In August the PDC said that its most pressing goal is to increase its congressional strength in the March 1965 elections when all the Chamber and about half the Senate will be renewed. Although the party is almost 30 years old, its spectacular increase in strength has occurred only since the last congressional elections in 1961. While the present Congress may give Frei limited [Page 594]emergency powers to help solve some of the country’s immediate problems, Frei will need a much larger plurality over the long pull.

Even if his party doubled its strength in Congress next March, he would still need additional support in attacking Chile’s longstanding problems. The two rightist parties (Liberal and Conservative), which helped to elect Frei as “the lesser of two evils”, will probably desert him when he moves against their entrenched interests. He has repeatedly attempted to win the Socialists in the FRAP away from the Communists, but with virtually no success so far. His most likely source of new support seems to be the center Radical Party, which might cooperate with him in return for guarantees of security for the many Radicals holding government jobs.

Implications for US. Frei’s victory is being hailed by stateside radio broadcasts as a victory both for Western democracy and the US. This is to some extent an over simplification, and the US will face problems as well as opportunities in Chile. While Frei has supported Western political objectives and the Alliance for Progress, he has at times been vigorous in his criticism of capitalism. His reform efforts will doubtless provoke propertied interests and lead to charges that he opposes free enterprise.3 Meanwhile, Frei has scheduled an economic mission to the US. He has been holding conversations with US copper companies in an effort to achieve a mutually satisfactory relationship with them. The PDC goal is to double copper production by 1970 in order to generate the revenues needed to support the party’s social program.

  1. Source: Johnson Library, National Security File, Country File, Chile, Vol. II, 9/64–11/64. Confidential.
  2. Frei announced his cabinet on October 26: Gabriel Valdés Subercaseaux, a Christian Democrat, was named Minister of Foreign Affairs; Molina, a political independent, Minister of Finance.
  3. The CIA assessed the outlook for the president-elect as follows: “Frei will be a less accommodating and a more nationalistic ally than Alessandri, because of his zeal for reform. Frei’s favorable attributes more than offset this.” “With some good fortune and tactful handling, Frei could become an outstanding leader and statesman in Latin America and an exceptionally valuable, if occasionally carping, friend of the United States.” (Special Report prepared by the CIA, [text not declassified]; Johnson Library, National Security File, Country File, Chile, Vol. II, 9/64–11/64)