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Abstract
In July of 1974, the J. Walter Thompson advertising company signed a contract with the Chilean junta to improve the international image of the dictatorship. Around two months later the agreement was made public, first in the United States and then around the world. Over the next few days, European and American JWT managers began to complain about the agreement. By the end of September, 1974, it was clear that the collaboration would have to be severed, which finally happened in October. In this paper, I show that both the efforts made to sign the contract and its sudden cancellation testify to the early makings of neoliberalism and its contingency. Pinochet’s Chile was an early neoliberal experiment; therefore this paper sheds new light on reconstructing the rising of neoliberalism within a Cold War framework. Most of the new historiography on neoliberalism focuses on ideas and public policy. I build on this recent historiography but change the scope. Here, I tell the story of a contract that provides a glimpse into this fundamental turn in the history of capitalism from the point of view of a multinational company facing the limits imposed by the negative reputation of the junta.
Disclosure statement
No potential conflict of interest was reported by the authors.
Notes
1 There is no book exclusively devoted to the history of JWT, although many articles have traced its expansion since the first decades of the 20th century. See for example: Douglas C. West, ‘From T-Square to T-Plan: The London Office of the J. Walter Thompson Advertising Agency 1919–70’, Business History, 29, no. 2 (1987), 199–217; Julio E. Moreno, ‘Marketing in Mexico: Sears, Roebuck Company, J. Walter Thompson, and the Culture of North American Commerce in Mexico City during the 1940s’, Enterprise and Society, 1, no. 04 (2000), 683–92; James P. Woodard, ‘Marketing Modernity: The J. Walter Thompson Company and North American Advertising in Brazil, 1929–1939’, Hispanic American Historical Review, 82, no. 2 (2002), 257–90; Clark Eric Hultquist, ‘Americans in Paris: The J. Walter Thompson Company in France, 1927–1968’, Enterprise & Society, 4, no. 3 (2003), 471–501; Ferdinando Fasce and Elisabetta Bini, ‘Irresistible Empire or Innocents Abroad? American Advertising Agencies in Post-War Italy, 1950s-1970s’, Journal of Historical Research in Marketing, 7, no. 1 (2015), 7–30; Robert Crawford, ‘Opening for Business: A Comparison of J. Walter Thompson and McCann Erickson’s Entries into the Australian Market’, Journal of Historical Research in Marketing, 8, no. 3 (2016), 452–72.
2 Personal letter from Jack Webster-Johnston, 5 Nov. 1974. Box 24, Chile, 1973–1974 1/2, Don Johnston Papers, J. Walter Thompson Company, David M. Rubenstein Rare Book & Manuscript Library, Duke University (JWT Collections).
3 Only two books mention the agreement: Armand Mattelart, Advertising International: The Privatization of Public Space (New York: Routledge, 1991), 43–44; Lars Schoultz, Human Rights and United States Policy Toward Latin America (Princeton, NJ: Princeton University Press, 2014), 73. In 2019, the agreement made the news once again in Chile: after the riots of October 2019, the government of Sebastián Piñera hired the Wunderman Thompson company, the company that resulted from the merger of JWT and Wunderman in 2018, to create an advertising campaign promoting social peace.
4 In 1970, JWT’s billing was $773,000,000, while by 1974 it reached $868,000,000. From that total, in 1970 a 43% came from outside the US; in 1974, that number climbed to 54% (1975–1976 Company Charts, Box 17, Information Center Records, 1890s–1987, JWT Collections). Regarding the Chilean office, in 1970, before closing, JWT held a 25% of the total advertising market in Chile, with a billing of U$S 4,230,000 (A Report on a Visit to Chile From the 13th to the 16th of Nov. 1973, Box 27, Chile 3/3, Don Johnston Papers, JWT Collections). For more context on the history of advertising in Latin America, see Moreno, ‘Marketing in Mexico: Sears, Roebuck Company, J. Walter Thompson, and the Culture of North American Commerce in Mexico City during the 1940s”; Ricardo D. Salvatore, ‘Yankee Advertising in Buenos Aires: Reflections on Americanization’, Interventions, 7, no. 2 (July 2005), 216–35; Natalia Milanesio, Workers Go Shopping in Argentina (Albuquerque: University of New Mexico Press, 2013); Fernando Rocchi, ‘A la vanguardia de la modernización: la incipiente formación de un campo publicitario en la Argentina durante la década de 1920’, Estudios Interdisciplinarios de América Latina y el Caribe, 27, no. 2 (2016); James P. Woodard, Brazil’s Revolution in Commerce: Creating Consumer Capitalism in the American Century (Chapel Hill: The University of North Carolina Press, 2020).
5 The literature on Allende’s government is abundant. See, for example, Peter Winn, Weavers of Revolution: The Yarur Workers and the Chile’s Road to Socialism (New York: Oxford University Press, 1986); Tanya Harmer, Allende’s Chile and the Inter-American Cold War (Chapel Hill: University of North Carolina Press, 2011). Both its democratic nature and the non-alignment with Moscow had given notoriety to Salvador Allende’s government, in a context where the Left was trying to reinvent itself in Europe and the US. See, for example, Margaret Power, ‘The U.S. Movement in Solidarity with Chile in the 1970s’, Latin American Perspectives, 36, no. 6 (2009), 46–66; Alessandro Santoni, ‘El Partido Comunista Italiano y el otro ‘compromesso storico’: los significados políticos de la solidaridad con Chile (1973–1977)’, Historia, 43, no. 2 (2010), 523–46.
6 Memorandum from Jack Webster to Harry Clark and Don Johnston, 4/18/1975. Henry Clark Papers, Box 20, Chile 1975, JWT Collections. There is no clear evidence about the exact timing or reasons for the withdrawal. Bucheli and Salvaj have studied how ITT, another multinational company with business in Chile, came under increasing scrutiny after 1964 when Eduardo Frei Montalva, a Christian Democrat, won the Presidential election. Although the case is different, it proves that the political atmosphere in Chile was not particularly favorable for American companies. When Allende took office in 1970, this situation became even more tense. See Marcelo Bucheli and Erica Salvaj, ‘Reputation and Political Legitimacy: ITT in Chile, 1927–1972’, Business History Review, 87, no. 4 (2013), 729–56.
7 See Juan Pablo Bohoslavsky, Karinna Fernández Neira, and Sebastián Smart, eds., Complicidad Económica Con La Dictadura Chilena: Un País Desigual a La Fuerza (Santiago: LOM Editores, 2019).
8 US involvement in Chilean domestic affairs could hardly be considered a novelty by 1973. In fact, from 1964 onwards the US had poured resources into Chile, first in order to prevent Allende’s victory, then, once Allende took office in 1970, to boycott his government. This kind of interventionism had a long history in the region, but certainly became worse after the Cuban Revolution. The US’s involvement in Chilean domestic politics was another episode of what Tanya Harmer has defined as the Inter-American Cold War. See Harmer, Allende’s Chile and the Inter-American Cold War. The literature on Latin America during the Cold War is extensive, see for example G. M. Joseph and Daniela Spenser, eds., In from the Cold Latin America’s New Encounter with the Cold War (Durham, NC: Duke University Press, 2008); Greg Grandin and G. M. Joseph, eds., A Century of Revolution Insurgent and Counterinsurgent Violence during Latin America’s Long Cold War (Durham, NC: Duke University Press, 2010); Benedetta Calandra and Marina Franco, eds., La Guerra Fría Cultural En América Latina: Desafíos y Límites Para Una Nueva Mirada de Las Relaciones Interamericanas (Buenos Aires: Editorial Biblos, 2012); Patrick Iber, Neither Peace nor Freedom: The Cultural Cold War in Latin America (Cambridge, MA: Harvard University Press, 2015); Aldo Marchesi, ‘Escribiendo La Guerra Fría Latinoamericana: Entre El Sur ‘Local’ y El Norte ‘Global,’” Estudos Históricos (Rio de Janeiro), 30, no. 60 (2017), 187–202; Thomas C. Field Jr, Stella Krepp, and Vanni Pettinà, Latin America and the Global Cold War (Chapel Hill: The University of North Carolina Press, 2020); William Booth, ‘Rethinking Latin America’s Cold War’, The Historical Journal, 64, no. 4 (2020), 1128–1150.
9 There are numerous works on the economic policies applied by the junta. See Peter Winn, ed., Victims of the Chilean Miracle Workers and Neoliberalism in the Pinochet Era, 1972–2002 (Durham, NC: Duke University Press, 2004); Manuel Gárate, La revolución capitalista de Chile (1973–2003) (Santiago de Chile: Ediciones Universidad Alberto Hurtado, 2013); Heidi Tinsman, Buying into the Regime: Grapes and Consumption in Cold War Chile and the United States (Durham, NC: Duke University Press, 2014). In a recent paper, Casals and Estefana have traced the concept of neoliberalism connected to the Chilean case, showing that the junta’s economic policies were only labeled as “neoliberal” at the beginning of the 1980s by a group of left-wing social scientist and intellectuals. See Marcelo Casals and Andrés Estefane, ‘El ‘Experimento Chileno’. Las Reformas Económicas y La Emergencia Conceptual Del Neoliberalismo En La Dictadura de Pinochet, 1975–1983’, História Unisinos, 25, no. 2 (2021), 218–30.
10 Thomas C. Wright and Rody Oñate Zúñiga, ‘Chilean Political Exile’, Latin American Perspectives, 34, no. 4 (2007), 31–49; Power, ‘The U.S. Movement in Solidarity with Chile in the 1970s”; Olga Ulianova, ‘El exilio comunista chileno 1973–1989’, Estudos Ibero-Americanos, 39, no. 2 (2013), 212–36.
11 Rather than a single clear economic plan, at the beginning of 1974, there were still opposing visions about the orientation the junta should adopt. The nationalist, corporativist, and developmentalist traditions inside the military remained influential after the coup. These groups did not sympathize with the liberalization policies that other sectors, mostly civilian, aimed to enact. The turning point happened in 1975, when Sergio de Castro arrived in the government. He was the main figure of the Chicago Boys, a group of Chilean economists trained at the University of Chicago through a partnership with the Pontificia Universidad Católica de Chile. But some of the reforms started already during 1974, like the privatization of public companies. See Juan Gabriel Valdés, Pinochet’s Economists: The Chicago School in Chile (Cambridge: Cambridge University Press, 1995); Verónica Valdivia Ortiz de Zárate, El Golpe Después Del Golpe: Leigh vs. Pinochet, Chile 1960–1980 (Santiago: LOM, 2003).
12 This dual process has been recently analyzed by Fritz Bartel, although he has focused mostly on Europe and the United States. See Fritz Bartel, The Triumph of Broken Promises: The End of the Cold War and the Rise of Neoliberalism (Cambridge, MA: Harvard University Press, 2022).
13 For examples of the historiography of neoliberalism, see: Hernán Ramírez, ‘Genealogías Del Consenso: Brasil y Argentina, 1961–1991’, A Contracorriente, 7, no. 3 (2010), 185–218; Angus Burgin, The Great Persuasion: Reinventing Free Markets since the Depression (Cambridge, MA: Harvard University Press, 2012); Vanessa Ogle, ‘Archipelago Capitalism: Tax Havens, Offshore Money, and the State, 1950s–1970s’, The American Historical Review, 122, no. 5 (2017), 1431–58; Quinn Slobodian, Globalists: The End of Empire and the Birth of Neoliberalism (Cambridge: Harvard University Press, 2018); Samuel Moyn, Not Enough: Human Rights in an Unequal World (Cambridge, MA: The Belknap Press of Harvard University Press, 2018); Amy Offner, Sorting out the Mixed Economy: The Rise and Fall of Welfare and Developmental States in the Americas (Oxford: Princeton University Press, 2019); Jessica Whyte, The Morals of the Market: Human Rights and the Rise of Neoliberalism (London: Verso, 2019); Oscar Ugarteche, ‘Pedro Beltrán, Rómulo Ferrero and the Origins of Neoliberalism in Peru: 1945–1962’, PSL Quarterly Review, 72, no. 289 (2019), 149–66; Dieter Plehwe, Quinn Slobodian, and Philip Mirowski, eds., Nine Lives of Neoliberalism (Brooklyn: Verso, 2020). For an analysis on the concept of neoliberalism, see Harold James, ‘Neoliberalism and Its Interlocutors’, Capitalism: A Journal of History and Economics, 1, no. 2 (2020), 484–518.
14 There is, too, another strand of literature analyzing how consumers, private business, workers, and banks navigated through the emergence of neoliberalism. See, for example, Kim Phillips-Fein, Invisible Hands: The Making of the Conservative Movement from the New Deal to Reagan (New York: W.W. Norton & Company, 2009); Matthew Hilton, Prosperity for All: Consumer Activism in an Era of Globalization (Ithaca: Cornell University Press, 2009); Victoria Basualdo, ‘The ILO and the Argentine Dictatorship’, in Essays on the International Labour Organization and Its Impact on the World during the Twentieth Century, ed. Jasmien Van Daele et al. (Berg: Peter Lang, 2010); Sebastian Alvarez, ‘The Mexican Debt Crisis Redux: International Interbank Markets and Financial Crisis, 1977–1982’, Financial History Review, 22, no. 1 (2015), 79–105; Carlo Edoardo Altamura, ‘The Paradox of the 1970s: The Renaissance of International Banking and the Rise of Public Debt’, Journal of Modern European History, 15, no. 4 (2017), 529–53. On a more structural, top-down approach, to the history of neoliberalism, see Niall Ferguson et al., eds., The Shock of the Global: The 1970s in Perspective (Cambridge, MA: Harvard University Press, 2011); J. Adam Tooze, Crashed: How a Decade of Financial Crises Changed the World (New York: Viking, 2018).
15 As I show below, different private companies were repudiated in Europe and the United States for diverse levels of involvement with the junta: from supporting the coup openly to obtain benefits from the junta to conduct business. However, make a profit for whitewashing the international image of the Chilean dictatorship took collaboration to another level, one where accusations of an ideological communion of interest sounded plausible. The historiography on business reputation has grown in recent years. For a literature review see Christopher Kobrak, ‘The Concept of Reputation in Business History’, Business History Review, 87, no. 4 (2013), 763–86; Rowena Olegario and Christopher McKenna, ‘Introduction: Corporate Reputation in Historical Perspective’, Business History Review, 87, no. 4 (2013), 643–54.
16 Jack Webster personal file, Box MN 28, Biographical Information, JWT Collections.
17 JWT Friday, 8/27/1974, Newsletter Collections, Box DO9, JWT Collections, p. 1.
18 J. Walter Thompson Company News, vol. 24, no. 42 (12 Dec. 1969), Newsletter Collection, JWT Collections, p. 3.
19 A Report on a Visit to Chile From the 13th to the 16th of November 1973, Box 27, Chile 3/3, Don Johnston Papers, JWT Collections.
20 Felipe González, Mounu Prem, and Francisco Urzúa I, ‘The Privatization Origins of Political Corporations: Evidence from the Pinochet Regime’, The Journal of Economic History, 80, no. 2 (2020), 417–56.
21 J. Walter Thompson Company News, vol. 24, no. 42 (12 Dec. 1969), Newsletter Collection, Box MN15, JWT Collections, pp. 2–3.
22 JWT World Highlights (June–July, 1974), Newsletter Collection, Box DO16, JWT Collections, p. 1.
23 Informe de la visita a Chile (24/12/73 – 4/1/74), Box 27, Chile 3/3, Don Johnston Papers, JWT Archives.
24 JWT World Highlights (Spring, 1974), Newsletter Collection, Box DO16, JWT Collections, p. 6.
25 Jackson Lears, Fables of Abundance: A Cultural History of Advertising in America (New York: Basic Books, 1994), 197.
26 Report on Chile. Principal conclusions for the New York Meeting, Don Johnston Papers, Box 27, Chile, 1/3, p. 9.
27 “Why Doesn’t Business Explain Itself Better.” A speech by Jack Hilton, Writings and Speeches, Box 13, Hilton, Jack, JWT Collections.
28 Brochure, Box 10, Folder Dialog – General, 1974, J. Walter Thompson Company. Henry Clark Papers, David M. Rubenstein Rare Book & Manuscript Library, Duke University, pp. 2–3.
29 Telegram from Jack Webster to Don Johnston (6/6/1974), Don Johnston Papers, Box 24, Chile 1973-73 2/2, JWT Collections.
30 Telegram from Don Johnston to Jack Webster (13/6/1974), Don Johnston Papers, Box 24, Chile 1973-73 2/2, JWT Collections.
31 Letter from Jack Webster to Don Johnston (1/8/1974), Don Johnston Papers, Box 24, Chile 1973–1974 2/2, JWT Collections.
32 Telegram from Jack Raymond to Don Johnston (19/7/1974), Don Johnston Papers, Box 24, Chile 1973–1974 2/2, JWT Collections.
33 Letter from Jack Raymond to Don Johnston (23/7/1974), Johnston Papers, Box 24, folder 2, JWT Collections.
34 Letter from Jack Webster to Don Johnston (31/7/1974), Don Johnston Papers, Box 24, Chile 1973-73 2/2, JWT Collections.
35 Agreement regarding a program of information and public relation in behalf of the government of Chile by Dialog, the Public Communications Division of the J. Walter Thompson Company, Johnston Papers, Box 24, Chile 1973-73 2/2, JWT Collections.
36 Telegram from Jack Raymond to Pedro Ewing (8/13/1974), Johnston Papers, Box 24, Chile 1973-73 2/2, JWT Collections
37 Melissa Aronczyk, Branding the Nation: The Global Business of National Identity (Oxford and New York: Oxford University Press, 2013); Erika Diane Rappaport, A Thirst for Empire: How Tea Shaped the Modern World (Princeton, NJ: Princeton University Press, 2017); Carolin Viktorin et al., eds., Nation Branding in Modern History (New York: Berghahn Books, 2018).
38 A few years later, in 1978, the Argentine dictatorship also signed a contract with another US PR company, Burson-Masteller. See Marina Franco, El Exilio: Argentinos En Francia Durante La Dictadura (Buenos Aires: Siglo Veintiuno Editores, 2008), 212.
39 Telegram from Jack Raymond to Pedro Ewing (8/13/1974), Johnston Papers, Box 24, Chile 1973-73 2/2, JWT Collections.
40 Memorandum from Ted Van Dyk to Jack Raymond, 9/4/1974, Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
41 Memorandum from Ted Van Dyk to Jack Raymond, 9/12/1974, Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
42 However, this was not the first mention to the contract in US media. From Sept. 7 to Sept. 13, the contract was mentioned in these local or regional newspapers: Boston Globe, Tallahassee Democrat, Daily World, The Christian Science Monitor, The Courier Journal, the St. Petersburg Times, and the Minneapolis Star.
43 Lewis H. Diuguid, ‘Chile Hires Ad Firm To Polish Up Image’, Washington Post, 13 Sept. 1974.
44 Sebastián Hurtado-Torres, The Gathering Storm: Eduardo Frei’s Revolution in Liberty and Chile’s Cold War (Ithaca, NY: Cornell University Press, 2020).
45 Laurence Stern, ‘CIA Role in Chile Revealed’, The Washington Post, 8 Sept. 1974.
46 The notion of an Inter-American Cold War suggests that the lack of involvement of the Soviet Union in the region opened the door for local actors to fight the Socialist cause. As a consequence, their battles became more intertwined with local and regional conflicts that are key to understand how Latin America underwent through the Cold War years. See Harmer, Allende’s Chile and the Inter-American Cold War.
47 On the role of commercial imperialism after Second World War, see Daniel Berger, William Easterly, and Nathan Nunn, ‘Commercial Imperialism? Political Influence and Trade During the Cold War’, The American Economic Review, 103, no. 2 (2013), 863–96.
48 In fact, there were many others former members of the JWT working for Nixon’s administration: “J.W.T. and the President’, New York Times, 24 1972.
49 Daniel Horowitz, The Anxieties of Affluence: Critiques of American Consumer Culture, 1939–1979 (Amherst: University of Massachusetts Press, 2004).
50 Letter from Van Dyk to Jack Raymond, Hilton, Johnston, and Barnum, 9/13/1974, Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
51 Memorandum from Jack Raymond to Johnston, cc Seymour, Wildon, Barnum, Devine, Hilton, Van Dyk, Corrigan, 9/13/1974, Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
52 Memorandum from Jack Raymond to Johnston, cc Seymour, Wildon, Barnum, Devine, Hilton, Van Dyk, Corrigan, 9/13/1974, Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
53 “US Ad Agency Hired’, The International Herald Tribune, 14–15 Sept. 1974.
54 Telex from Dennis Lanigan to Harry Clark, 9/16/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
55 Telex from Greg Bathon to Harry Clark, 9/16/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections. It is hard to guess which newspaper Bathon was referring to, but indeed the Jornal do Brasil reproduced the Washington Post article: “Chile Dá Liberdade Sem Troca’, Jornal Do Brasil, 14 Sept. 1974.
56 Memorandum from Don Johnston to all JWT Offices. 9/16/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
57 Letter from Mortimer Kohn to Don Johnston. 9/19/1974, Don Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections. The letter was sent on Sept. 19, but only arrived on the 23.
58 Letter from Denis Lanigan to Don Johnston, 9/20/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
59 On the role of The Economist in Chile, see Alexander Zevin, Liberalism at Large: The World According to the Economist (Brooklyn: Verso Books, 2019), 620–23.
60 Memorandum to Harry Clark, Hugh Connell, Wyatte Hicks, Alun Jones, Ted Wilson, and Jack Raymond, 9/23/1974, Don Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
61 Letter from Roy A. Glah to Don Johnston, 9/24/1974, Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
62 Telegram from Don Johnston to Jack Webster, 9/27/1974, Don Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
63 Telegram from Jack Webster to Don Johnston, 10/4/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
64 Telegram from Jack Raymond to all managers, 10/4/1974, Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
65 Letter from Jack Webster to Brouwet (Brussels), Campbell-Harris (Milan), Doyer (Amsterdam), Gilow (Frankfurt), Laningan (London), Muller (Zurich), Novotny (Sotckholm), Parrild (Copenhagen), Yarnell (Paris), and cc to Wilson, Johnston, Sharman, Clarck, Baxter, Raymond (all of them from NY), 10/7/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
66 Letter from Jack Webster to Don Johnston, 10/9/1974. Don Johnston Papers, Box 24, Chile 1973-73 1/2, JWT Collections.
67 Letter from David Campbell-Harris to Jack Webster, 10/21/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
68 Letter from Danis Lanigan to Jack Webster, 10/23/1974. Harry Clark Papers, Box 20, Chile 1974, JWT Collections.
69 Letter from Jack Webster to Denis Lanigan (cc. managers in Europe and Latam), 10/28/1974. Harry Clark Papers, Box 20, Chile 1975, JWT Collections.
70 Memorandum from Jack Webster to Harry Clark and Don Johnston, 4/18/1975. Henry Clark Papers, Box 20, Chile 1975, JWT Collections.
71 Stefan H. Rinke, Encuentros Con El Yanqui: Norteamericanización y Cambio Sociocultural En Chile (1898–1990) (Santiago, Chile: Ediciones de la Dirección de Bibliotecas, Archivos y Museos, 2013), 358.