One of the paradoxes of the twentieth century is that just as the word imperialism became a taboo and toxic word after the Second World War, imperial practices persisted and, in many ways, deepened. The collapse of the European colonial empires and the moral discrediting of the ‘civilising mission’ meant that the US policy makers could not openly claim or suggest that what they were doing was a form of ‘empire’.
While the language of empire had disappeared from discourse and made into a taboo, the practices of empire had not; it simply evolved. Emerging from the Second World War as the foremost global power, the United States now faced a new ideological challenge – not fascism, but communism. The defeat of Nazi Germany, Mussolini’s Italy, and Imperial Japan had affirmed America’s belief in its role as a defender of freedom, yet the presence of the Soviet Union and its influence transformed that mission into containment. The ideological confrontation between capitalism and communism provided a moral framework through which US expansion could be justified. Nowhere is this more evident than in Latin America - a region long perceived through the lens of the Monroe Doctrine as part of America’s natural sphere of influence (LaFeber 1989, 208-214). During the Cold War, Latin America became a testing ground for America’s foreign policy. From Cuba in 1953 to Chile in 1973, American leaders viewed left wing movements not as local social struggles for equality but as Soviet aggression into ‘America's backyard’. While the US saw left wing movement as a transgression into their territory, Cuba merely perceived their ideology as means to achieve sovereignty and economic prosperity (Rodríguez and Targ 2015, 22). Consequently, the region witnessed a pattern of US intervention, CIA backed coups, and economic pressure. It is within this context that the evolution of a modern US imperialism can be most clearly seen.
This essay will argue that this US paranoia about communism gave rise to a uniquely modern form of imperialism, most visible in its foreign policy toward Latin America. Driven by the perceived need to contain this spread of socialism, the US developed a system of informal empire that fused use of its military power, economic power, and cultural aspirationalism. This essay will use the examples of Cuba, Chile, and Panama to exemplify this novel form of empire: each case reveals how the US justified intervention through the rhetoric of freedom and the ‘American Dream’ while consolidating economic and ideological dominance. It draws on declassified CIA documents and presidential speeches to grasp the full image of the lived experience of American intervention. The essay will proceed in four parts. The first section examines the ideological framework of the cold war and the logic of containment that underpinned the Truman doctrine and further US foreign policies. The following three case studies – Cuba, Chile, and Panama – illustrate how this ideology translated into practice, through military intervention and the projection of American culture.
Historiography on US imperialism in Latin America reveals deep tensions between realist – a political theory that assumes that all States are focused on pursuing power at the expense of other states (Wohlforth 2009, 135) – interpretations of Cold War strategy and cultural interpretations of dependency (Shiraz 2011, 603-613). Early frameworks, such as Gallagher and Robinson’s theory of the imperialism of free trade, provided a foundation for understanding how domination could exist without territorial control, but their focus on the British case left little space for Latin America. Later scholars turned to the US as the central imperial power of the twentieth century. In Empire’s Workshop (2006), Greg Grandin argues that Latin America became a ‘laboratory’ for American power, where methods of intervention and neoliberal reform were tested before being applied in home territory. Yet Grandin’s state centred approach has been questioned by those who highlight competing motives and interpretations of US action. Jack Devine, a former CIA operative writing in Foreign Affairs (2014), offers an insider’s defence of US’ conduct in Chile. He insists that the agency neither planned nor directed the 1973 coup, and instead presents American involvement as a limited and pragmatic effort to stabilise a country on the brink of economic collapse. In his account, the US’ actions were reactive and protectionary rather than imperial in nature – an attempt to prevent Chile from falling into the Soviet orbit rather than to purposefully impose US dominance. Others, however, see this as an overly charitable interpretation. Lubna Qureshi’s Nixon, Kissinger and Allende (2009) argues that behind the language of containment lay the defence of US corporate interests, particularly those of copper and telecommunication firms whose profits and assets were threatened by Allende’s decision of nationalisation of companies. Zakia Shiraz (2011) takes a broader view, noting that the mass declassification of CIA records in the 2000s has not settled the debate but intensified it: realist historians such as Jonathan Haslam interpret US intervention as the exercise of Cold War diplomacy – using strategy and power politics (statecraft) to contain communism, not to build an empire. Critics however, interpret the same evidence as showing a different kind of empire, one not built upon colonies but more on economic control and the spread of American ideas. Overall, the historiography reveals a division between those who interpret US actions as pragmatic responses to the Cold War and pressure from the USSR and those who see them as expressions of a deeper imperial logic. While there is no single consensus on the motivations behind American foreign policy, these debates provide the foundation for understanding how US influence in Latin America evolved into a modern form of empire.
While these debates expose the complexity of interpreting US motives, my essay aligns more closely with scholars such as Qureshi and Shiraz, who see ideology and economic self-interest as inseparable forces shaping American foreign policy. Like them, I view the Cold War not as simply just about strategy and defence, but also about ideas. The US used rhetoric that framed itself as protecting democracy while masking the hierarchies of power – who controls them and whose system defines progress – and used this rhetoric to justify actions that reinforced its own global dominance and position as the hegemon. By contrast, I diverge from the more realist interpretations, such as those of Haslam or Devine, who focus too narrowly on diplomacy and power politics and do not account for the cultural and ideological influence that were central to maintaining American influence.
Latin American historians have challenged both the realist and dependency debate by focusing on how ideas, beliefs, and cultural identity shaped US-Latin American relations – for example, how the US tried to influence what people thought or aspired too, not just their governments or economies. Raul Rodriguez and Harry Targ (2015) contend that US policy toward Cuba was not simply about containing communism but about containing the Cuban example – a revolution that symbolically defied US hegemony and inspired alternative models of modernity across the Global South. For Rodriguez and Targ, the Cold War was as much of a battle of ideas as arms, a campaign to neutralise revolutionary imagination itself. This insight aligns with Anibal Quijano’s theory of the coloniality of power (2000), which exposes how old hierarchies of race, culture, and knowledge continued to shape societies even after they gained independence, keeping them dependent on former colonial powers. Together, these scholars shift attention from economic force to the cultural and ideological ways that empire survives. These scholars highlight less coercive forms of imperialism, such as aspirationalism – the projection of American liberal ideals and consumer values as universal symbols of freedom and progress. My essay builds on that insight, examining how such ideological influence operated alongside military and economic power in the Cold War era.
It is against this background that US imperialism shows its true face. I understand US imperialism in Latin America as a system in which states remain formally sovereign, yet their policies are shaped to serve the interests of the hegemon. US imperialism is thus more than simply economic leverage and monopoly – it is also what Quijano calls the coloniality of power as forementioned. Machiavelli in The Prince (1532) states that rulers must appear virtuous while acting ruthlessly – this provides a way to understand Cold War US foreign policy. American power was Machiavellian in this sense.
The Cold War cannot be understood without first considering the ideological frameworks through which both the United States and the Soviet Union interpreted politics. From a Marxist perspective, imperialism represented what Lenin called ‘the highest stage of capitalism’, the point at which capitalist states would inevitably export surplus capital abroad and dominate weaker economies (Lenin, Imperialism, 1916). Crucially, Lenin also warned that this global competition for resources and influence would produce an inevitable clash between ‘forces of capital and forces of the people.’ In the Soviet lens, US behaviour after 1945 confirmed this thesis. Programmes such as the Marshall Aid (1947) offered multi-billion-dollar loans and grants to rebuild Europe after the Second World War. The Marshall Plan tied European economies to the dollar, opening them to American goods and aligning them with US geopolitical priorities (such was seen in the 1950s and 1960s when America stored nuclear weapons in both Italy and Turkey in its vie for first strike capability). Critics in the Eastern Bloc labelled this as Dollar Imperialism (the term first coined by Vyacheslav Molotov): the policy of a nation using its economic power and international dominance of its currency (in this case, the dollar), to exert control over other countries and secure its own interests, often through financial aid and investment. This dynamic outlived the Cold War. Panama continues to use the US dollar as its formal currency – a lingering legacy of Cold War-era economic dependence and a reflection of how American influence endured even without direct control.
The ideology of containment gave rise to a distinctly modern form of US imperialism – one that justified economic expansion and political intervention as a moral duty rather than acts of dominance. By controlling credit, markets, and tying currencies to the American dollar, the United States extended its reach into the domestic policies of other nations, just as colonial powers had once dictated trade routes. As the historian Michael Hogan has argued, the Marshall Plan ‘was as much about preventing communism as it was about reconstructing Europe’ (The Marshall Plan: America, Britain, and the Reconstruction of Western Europe, 1987). The Soviet Union interpreted the Marshall Plan as containment masked as economic generosity. Thus, Stalin ordered all Eastern Bloc countries to reject the Marshall Aid (which furthered the divide between the East and West). Before the Marshall Plan, there was already two years of paranoia since 1945. In George Kennan’s Long Telegram (1946) he portrayed the Soviets as incapable of rational compromise and concluded that containment was the only strategy that would work. The Truman Doctrine (1947) furthered this idea, committing the United States to defend ‘free peoples’ everywhere. These doctrines transformed ideology into practice: by defining capitalism and democracy as synonymous with civilisation, they made global intervention appear altruistic in its essence. In practice, this translated into a willingness to support authoritarian regimes so long as they were anti-communist, from Greece and Turkey in the late 1940s to Latin America in the 1960s and 70s. The US adopted the policy ‘the best defence was offence’ – a policy that underpinned both Marshall Aid in Europe and operations in other continents. Domestically, McCarthyism amplified this culture of fear through the Red Scare, diminishing any sign of restraint as any weakness abroad could be branded as treason.
Culture also played a part. American abundance of cars, appliances, consumer goods, and the appeal of Hollywood and Andy Warhol’s pop art, all contrasted with Soviet life and its government distributions of food (which often resulted in food shortages as most of government spending went to the military). The political scientist Joseph Nye would later call this ‘soft power’: the ability to attract and persuade rather than to coerce (Bound to Lead, 1990). For many outside observers, the appeal of Hollywood or Coca Cola was at least as powerful as NATO or the CIA. However, soft power could also function imperially: it shaped the desires and aspirations of foreign publics, embedding them into an American model of modernity.
The very idea of ‘cultural imperialism’, however, has been challenged. Claude-Jean Bertrand in 1987 argued that the term is ‘deeply pejorative’ and often used polemically rather than analytically. For him, to speak of cultural imperialism was to assume that audiences are passive victims of American media, incapable of interpretation, and to assume that the recipient countries of American media cannot filter what they want and do not want to show the audience. He noted that cultural flows were never unidirectional: European and Latin American cultures also influenced the United States, while American cultural exports were adapted abroad. Bertrand pointed out that if one applied the ‘cultural imperialism’ label consistently, then the Soviet Union should also be seen as a cultural imperialist power, the difference being that the USSR did not succeed in exporting its culture. Soviet propaganda relied too heavily on coercion alone – teaching Russian as a compulsory language, censoring foreign films and music, and broadcasting state centred messages. Unlike American popular culture which inspired the citizens, Soviet culture offered little that appealed to foreign publics. Even within the Eastern Bloc, young people often turned secretly to American jazz. For Bertrand, this showed that ‘cultural imperialism’ was a concept that overstated American power while underestimating the power of the recipients of that ‘cultural imperialism’. Yet precisely because American influence operated through aspiration rather than coercion, it exemplified a new kind of imperialism – one grounded in ideology rather than only by means of territorial control. By exporting images of freedom and projection of modernity that others wished to copy, the United States turned culture itself into an instrument of power, revealing how the Cold War transformed imperialism into a battle over values and imagination.
But Bertrand’s critique misses an important point. While American culture was not ‘forced’ in the same way Soviet propaganda was, it was not simply a matter of free choice either. Hollywood films, Coca Cola and McDonald’s adverts, and pop music spread so widely because the United States had the wealth to distribute them globally. They had enough money to invest in transnational corporations and to make them attractive to viewers and consumers. American studios and businesses operated internationally, thus their advertisement shaped consumer desires. It was also difficult to not open markets to American films and goods due to their popularity and a country’s currency tied to the dollar. In Latin America, the popularity of American films was linked to deeper patterns of economic dependency. US companies not only exported movies and music but also owned the cinemas and radios that delivered them. In this sense, audiences may have chosen American culture, but they were choosing from options which were already dominated by US businesses. It is also misleading to dismiss cultural imperialism just because people enjoyed American culture. Pleasure itself could carry political meaning. A pair of jeans or a trip to the cinema symbolised freedom of choice, economic prosperity – values that were tied to America and the ‘American dream’ as well as liberal ideals. Even if viewers interpreted movies and songs in a different way, the association between freedom and consumption was reinforced again and again. The Soviet Union’s cultural model failed not only because its products were less glamorous, but also because they were too idealistic and not related to day to day lives of ordinary people: propaganda about socialist progress clashed with food shortages and restrictions on personal freedom. American culture, by contrast, aligned with visible prosperity and abundance, making its messages more believable and relatable. In Latin America, this dynamic took on a distinctly aspirational form. For many, the United States represented not a political system to imitate but a desired lifestyle, one of wealth and comfort that contrasted with one’s own nation’s inequality and underdevelopment. The spread of America media therefore did more than entertain; it projected an image of attainable progress that reinforced US ideological dominance. This was the essence of ‘aspirationalism’ – the transformation of cultural admiration into subtle imperial influence.
For these reasons, Bertrand is right to warn against using ‘cultural imperialism’ as the sole reason for American dominance but wrong to dismiss it altogether. Culture alone did not create US dominance, but it reinforced the economic and political structures that sustained it. By shaping what seemed desirable (the ideal life, modern and free), American culture helped normalise US power. In Latin America, the glamour of Havana nightlife before Castro and the spread of Hollywood movies all worked alongside US policies of government intervention and economic leveraging. Cultural imperialism cannot be viewed on its own but as one of many crucial elements of US imperialism. To see how these elements operated together in practice, Cuba offers the clearest example. From the Spanish-American War of 1898 onwards, the island became a laboratory for US power and one of its earliest dependencies. Cuba became a country that had its sovereignty and was formally independent but economically, politically, and culturally tied to America. What happened in Cuba before and during the Cold War supports the logic of US imperialism: sovereignty in name, dependence in practice.
Cuba
The Platt Amendment (1901) gave Washington the right to intervene militarily in Cuban affairs and established a permanent naval base at Guatanamo Bay. As Lars Schoultz argues in That Infernal Little Cuban Republic (2009), Cuba was ‘free but not independent’. It was a protectorate – a state that remains formally independent but is controlled or guided by a stronger power. The roots of US involvement in Cuba stretch back to the Spanish American War of 1898 when the United States intervened in Cuba’s war of independence against Spain. Cuba had been fighting for independence from Spain since 1895 in a war that destroyed plantations and disrupted trade. Many Americans sympathised with the Cuban rebels, but the US newspapers (especially those of William Hearst and Joseph Pulitzer) sensationalised Spanish atrocities in what became known as ‘yellow journalism’. Public outrage grew after the mysterious explosion of the USS Maine in Havana harbour in 1898, which killed over 250 sailors. Although later investigations suggested that the explosion was an accident, the incident was blamed on Spain and became the rallying cry for war. The US leaders also saw this as an opportunity to expand American influence over Caribbean markets and sea routes as well as to dislodge a dying European empire from the western hemisphere. The war itself was short, but it was decisive. Spain’s defeat ended its empire in the Americas, Puerto Rico became an US territory, and Cuba was granted formal independence. But this independence was linked to American control – the Platt Amendment ensured that US power persisted long after the war, marking the beginning of a pattern of informal empire that would later shape Cold War era interventions in Cuba.
Greg Grandin describes pre-revolutionary Cuba as proof that the US used Latin America as a workshop where it performed means of control without formal territorial annexation. Through the first half of the twentieth century, Cuba remained bound to the US. Sugar dominated the economy and quotas tied to its export almost entirely to the US market. American corporations owned the banks and the oil refineries. Havana itself became the centre of US consumerism – it contained casinos, luxury tourist hotels, nightclubs, etc. This pre-Cold War model of empire rested on economic leverage and cultural infiltration, creating a state that was politically sovereign but not economically independent. During the Cold War however, the nature of US imperialism shifted. Economic control was no longer sufficient, and influence now required some sort of ideological dominance. The rise of communism and nationalism transformed Cuba from a compliant state into a battleground for the contestation between capitalism and communism. Thus, US policy evolved from only safeguarding markets to safeguarding ideology on top of that, and redefining what an empire means, through the rhetoric of freedom and containment.
Castro’s Cuban revolution during the Cold War did not end Cuba’s dependency on foreign powers, but merely reversed it from being dependent on the US to being dependent on the Soviet Union, exposing how Cold War alignments redefined rather than eliminated imperial control. Fulgencio Batista was an important figure during the Cold War in Cuba. He ruled both directly and indirectly in the 1930s to 1950s. His regime, however, was extremely disliked for its corruption. In 1959, Fidel Castro and his supporters overthrew Batista. A key point to make was that Castro’s movement was nationalist, not communist, although politically he was leftist. In his speech History Will Absolve Me (1953,) later published as a manifesto, he laid out a programme of land reform and social justice. Once in power, his government began nationalising US owned oil refineries and banks. Large estates, many of which were American owned, were redistributed and private companies nationalised. When the US retaliated by cutting sugar quotas, Castro turned to the Soviet Union which agreed to purchase Cuban sugar in exchange for oil and aid. The mechanism of dependency was thus reversed – Cuba broke from US economic control but fell into alliance with Moscow and became economically dependent on Moscow. For the United States, this shift represented more than the loss of an economic ally – it signalled the erosion of US hegemony in what it had long considered its own sphere of influence, intensifying fears that the entire South America might slip beyond its control from the Domino Theory.
The failure of the Bay of Pigs invasion humiliated President Kennedy, strengthened Castro’s standing in the eyes of the Cubans, and drove Cuba further into Soviet alignment. In trying to conceal American imperial involvement, the United States had exposed the reality of its informal empire – its power exercised covertly but visibly enough to discredit its claims of defending freedom. Conceived under President Eisenhower and approved by President John F Kennedy, the operation aimed to overthrow Castro’s government by landing a force of Cuban exiles on the southern coast of the island, sparking a popular uprising that would topple him from within. Kennedy hoped that such a covert action would remove a Soviet ally without the US appearing directly responsible – preserving America’s moral image while containing communism that was on its doorstep. Yet from the outset, the plan was flawed. The invasion of around 1400 exiles was poorly equipped and lacked local support, and US air cover was withdrawn at the last moment to maintain secrecy. Declassified documents published by Peter Kornbluh show how the CIA trained and armed Cuban exiles while pretending the operation was a local uprising, but within three days Castro’s forces had crushed the invaders at Playa Girón and this failure was exemplified by the humiliating fact that none of the Cuban locals wanted to join in with the American ‘revolt’.
The Bay of Pigs pushed Cuba firmly into the Soviet camp, leading directly to the Cuban Missile Crisis of 1962. Castro was democratically chosen (not elected, but the Cuban public hailed him as a hero after the revolution), thus the Bay of Pigs event violated international law, and some say this was an attempt to undermine democracy. However, others view it as justified because Cuba was ‘America’s backyard’, being only 204 nautical miles from Miami, and Cuba turning communist suggests a direct failure of containment. The invasion thus encapsulated the moral contradiction at the heart of modern US imperialism – in seeking to defend freedom, it undermined it. What was presented as the preservation of democracy became in practice, the assertion of influence – an attempt to sustain control through indirect interventions instead of direct, open rule. In this way, the Bay of Pigs revealed how the Cold War transformed US imperialism into one that is distinctly ideological, one that redefined domination as a form of moral responsibility.
Cuba reveals how the structures of informal empire, established in the first half of the twentieth century, adapted rather than disappeared during the Cold War. In the early decades, informal empire had relied on economic dependency; by the 1960s, it was maintained through cultural aspirationalism, ideology, and moral superiority. Cuba became a site of cultural struggle within this system. Under Batista, Havana’s glamour was an extension of American consumerism – casinos, Hollywood films, and fashion. After 1959, Castro promoted a socialist alternative. Literacy campaigns and universal healthcare were his campaign slogans, and this painted Cuba as a beacon for equality. The ‘healthcare aspirationalism’ (the way Cuba’s socialist project promoted access to free and universal healthcare as a symbol of moral advancement; a vision of progress that rivalled the American ideal of prosperity for all through consumption) competed directly with the American dream of consumer choice. However, things are not always black and white. Cuba’s equality came with restricted liberties, while America’s consumerism paced the way for inequality and wealth disparity. The clash of models shows how cultural aspiration was essential to an informal empire, shaping not just the policies but what it means to be modern. Even after the Missile Crisis, US sanctions continued. The legacy of US policy still matters today, as more than sixty years after the revolution, the embargo remains in place (prohibition on nearly all trade and investment between US and Cuba) making it one of the longest standing sanctions in history. Since 1962, the embargo has been modified but never lifted. Its effects are visible in shortages of medicine and limited access to international markets. The endurance of this policy shows how informal empire has a long afterlife: even without direct occupation, US decisions continue to shape the daily life of Cubans. In this way, the case of Cuba acts as a reminder that the structures of informal empire established in the twentieth century still shape the twenty first.
Chile
The US experience in Cuba exposed the limits of the Truman Doctrine and showed that containment could fail even in America’s own hemisphere. Determined to prevent ‘another Cuba’, Washington intensified its efforts to control political outcomes across Latin America. This determination was soon tested in Chile, where the election of Salvador Allende in 1970 alarmed US policymakers. This shows how US foreign policy evolved from containment, which in its essence was reactive, to intervention, which was proactive. It is relevant because it marks the point where the defence of ideology became inseparable from retaining influence in certain regions. His socialist agenda triggered a campaign of economic pressure and military operations, culminating in the CIA backed coup that brought General Augusto Pinochet to power.
The case of Chile illustrates how the logic of informal empire moved beyond the Caribbean and into South America. By translating the strategies of control first tested in Cuba into the context of a democratic nation, the United States refined its imperial influence through aid and active intervention of overthrowing a democratically elected leader. In 1970, Salvador Allende, leader of the Popular Unity coalition, became the world’s first democratically elected Marxist president. Allende’s programme was moderate compared to Castro, but it directly threatened US corporate interests. He nationalised copper mines, which were dominated by US companies like Anaconda and Kennecott – along with banks and utilities, while pushing land reform to redistribute estates (all of which very similar to what Castro had done previously). For many Chileans, these reforms were framed as the ‘Chilean road to socialism’ – a democratic path to equality. But for Washington, they confirmed the Marxist view that capitalism could be undermined not only by guerrilla warfare but also through elections.
The US response was shaped by Henry Kissinger, then National Security Advisor and later Secretary of State. Kissinger feared that a successful democratic socialist experiment in Chile would have a domino effect across Latin America. He stated, ‘I don’t see why we need to stand by and watch a country go communist because of the irresponsibility of its own people’. This remark, documented in Peter Kornbluh’s The Pinochet File, reveals an imperial mindset – Chilean democracy was acceptable only so long as it produced outcomes favourable to US interests. According to Lubna Qureshi’s Nixon, Kissinger and Allende, Kissinger deliberately framed Allende as a Soviet proxy, even though Allende’s alignment with Moscow was limited.
Declassified CIA documents show that Washington took a two-track approach to destabilise Allende, revealing how US imperialism operated through not just economic pressure but also through military intervention. On one level, Nixon instructed the CIA to organise a military coup (known as Track II) even before Allende had been inaugurated. The CIA channelled money to right-wing officers and explored ways to kidnap or assassinate General René Schneider, the commander-in-chief of the Chilean army, who opposed intervention. The attempt failed, but it revealed the extent of US willingness to interfere directly (Pinochet File, Kornbluh, 2003).
Economic manipulation was central to the maintenance of the American informal empire in Latin America. In Chile, the United States moved aggressively to ‘make the economy scream’. The Nixon administration blocked loans from the World Bank and the Inter-American Development Bank, cutting Chile off from vital sources of credit. Between 1970 and 1973, Chile received only $3 million in loans, compared to $270 million during Frei’s presidency before Allende (Qureshi, 2009). Multinational corporations lobbied Washington for protection of their assets: ITT (International Telephone and Telegraph), which faced nationalisation, provided the CIA with $1 million to destabilise Allende’s government, funding strikes and anti-government propaganda campaigns (Pinochet File, Kornbluh). The CIA spent over $8 million between 1970 and 1973 on operations in Chile, much of it to finance opposition newspapers such as El Mercurio, which relentlessly attacked Allende as a dictator-in-the-making. Through such measures, the US demonstrated that imperial control in the Cold War era no longer required formal territorial annexation, but rather, economic dependency were sufficient to maintain control and dominance.
US funds also went into labour unrest. In 1972, a strike by Chilean truck drivers paralysed distribution across the country. While framed as a spontaneous protest, declassified documents reveal it was heavily subsidised by the CIA, which poured millions into keeping the strike alive (Kornbluh, Pinochet File). This created widespread shortages and further weakened Allende’s support. By creating and spreading propaganda, and organising strikes, the US illustrated the economic chaos that it then pointed to as proof of socialism’s failure.
By taking a chokehold on the Chilean economy, the US hoped to turn public opinion against Allende. Greg Grandin notes that this was consistent with the logic of informal empire: formal invasion was not necessary when economic levers could destabilise governments just as effectively.
The crisis culminated in the military coup of 11 September 1973. Backed by US intelligence, the Chilean military bombed the presidential palace. Allende died inside – whether by suicide or murder remains debated. General Augusto Pinochet emerged as dictator. What followed was a reign of terror: thousands were killed, tortured, or disappeared, concentration camps were established in stadiums, and fear was widespread among citizens. Declassified US cables reveal that Kissinger reassured Pinochet of US support, despite full knowledge of the atrocities.
Pinochet’s dictatorship also turned Chile into a laboratory for neoliberal economics. US trained economists, known as the ‘Chicago Boys’, implemented reforms such as privatisation of industries and opening the economy to foreign investment. Greg Grandin calls Chile ‘the test case for neoliberalism’. Here, informal empire worked not only through force but through economics: reshaping an entire society to align with US led capitalism.
Cultural politics also played a role. Allende had framed socialism as democracy – ‘La vía chilena al socialismo’ (the Chilean road to socialism) – arguing that equality and freedom were inseparable. After the coup, Pinochet claimed to be defending ‘Western civilisation’ and ‘liberal aspirationalism’, even as he destroyed democratic institutions. This claim mirrored the US’ – repression justified as the protection of freedom. American culture and media reinforced this framing, portraying Chile’s coup as a tragic but necessary to prevent another Cuba. Once again, the power in Chile came not only from weapons and funding but also the way the events were presented, with repression presented as protection.
Taken together, Cuba and Chile reveal how the logic of informal empire expanded across Latin America, moving from direct intervention to more complex forms of economic and cultural control. If Cuba and Chile showed how informal empire could operate through regime change and economic destabilisation, Panama demonstrated another form of American dominance – through a monopoly, and thus purely by economic leverage.
Panama
Completed in 1914, the Panama Canal gave the United States enormous leverage over global trade, as well as military mobility between the Atlantic and Pacific. Though Panama was formally independent (after being separated from Colombia in 1903 with US backing), the Canal Zone remained under US control, effectively a colony carved out of Panamanian territory. Walter LaFeber calls the canal ‘the most visible and resented monument of US imperialism in Latin America’ (The Panama Canal, 1989).
Throughout the Cold War, Panama’s relationship with the US was defined by this unequal arrangement. American officials presented the Canal as a neutral international waterway, but in practice it was controlled exclusively by Washington. The US stationed troops in the Canal Zone, controlled the amount of money made from the Panama Canal and largely excluded Panamanians from decision-making. This was justified through the familiar Cold War language of defence of democracy: US policymakers argued that only they could guarantee the Canal’s safety against communist subversion. Yet, as LaFeber shows, the arrangement bred resentment inside Panama, where people saw the Canal Zone as a reminder of loss of sovereignty.
Tensions peaked in the 1964 riots, when Panamanian students attempted to raise their national flag in the Canal Zone. US troops opened fire, killing more than 20 Panamanians and injuring hundreds. The violence forced both governments to then negotiate and became a critical turning point that led to the Torrijos-Carter Treaties and the 1999 handover of the Canal to Panama. For many Latin Americans, the shootings confirmed that US domination of the Canal was colonial rule. LaFeber argues that the riots revealed ‘the contradiction of informal empire’ – a state formally independent but unable to control its most important national asset.
The Torrijos–Carter Treaties of 1977, signed by Panamanian leader Omar Torrijos and US President Jimmy Carter, promised to return control of the Canal to Panama by 1999. The treaties marked an important shift. They acknowledged, at least symbolically, that US imperialism could not last forever without provoking resistance. US authority over the Canal Zone had been formal, and the logic behind it was imperialistic: Panama was nominally sovereign but unable to control its most strategic asset. The treaties therefore represented an attempt to rebrand formal domination as partnership. Yet even after 1977, dependency persisted. The United States retained the right to intervene militarily to protect the Canal’s neutrality, and its economic presence remained powerful through investment, aid, and trade. After the full transfer of control in 1999, American influence did not disappear but evolved into a subtler, informal form. Panama continued to rely heavily on the US dollar, which it adopted as legal tender in 1904 and still uses today, tying its economy to US monetary policy. American firms remained dominant in logistics, banking, and construction around the Canal Zone, and the US continued to be Panama’s main trading partner. These ties maintained a degree of dependency even without direct control. In this sense, post 1999 Panama illustrates how US imperialism persisted after the Cold War ended – through economic structures that became deeply rooted within the system rather than physical occupation.
Seen in the broader context of the Cold War, Panama was less about communism than about geopolitics. Control of the Canal meant control of trade routes and rapid military deployment – an advantage the United States feared would fall into Soviet hands. In the United States’ logic, any challenge to US control risked opening the door to Soviet influence in the Western sphere of influence. Student protests and nationalist movements in Panama during the 1960s were therefore quickly framed as communist, justifying a heavy-handed response in the name of defending the ‘free world’. Yet the US framed its presence not as imperial but as a global responsibility, another example of Machiavelli’s dictum that rulers must appear virtuous while acting ruthlessly. To Panamanians, the Canal was a symbol of dependency and loss of sovereignty. To Washington, it was evidence of leadership. This tension further illustrates how informal empire depended not only on economics and military power but also on what they frame their actions to be.
The US control of the Panama Canal also invites comparison with the earlier British Empire. Just as Britain had secured its dominance by controlling strategic chokepoints like the Suez Canal and sea lanes surrounding the British Isles, the United States ensured its global reach by monopolising Panama. In both cases, imperialism was sustained less by annexing vast territories than by controlling key routes of trade. Britain had long relied on its navy to dominate the seas and secure its empire. By controlling key routes like the Suez Canal and the waters around Europe and Asia, it was able to dismiss travel times and trade with its colonies more efficiently. This control was often justified as defence of ‘free trade’ but in practice, it meant that Britain set the terms of trade and kept the other nations dependent. The US took a similar approach in Panama. By holding on to the Canal Zone, Washington claimed it was simply protecting an international waterway for everyone’s benefit and use. Yet, as with Britain, the main beneficiary were American corporations, and the real effect was to keep power and profits in American hands. Both cases show the same basic imperial logic: domination was masked as responsibility (with a certain degree of paternalism), but sovereignty was restricted whenever situations did not benefit the hegemon. In both cases, the presence of not only troops but also bases, political advisors, and economic control were a reminder that empire could survive without formal annexation.
Conclusion
These three case studies illustrate how the United States developed a distinctly modern imperialism during the Cold War. Unlike older colonial powers, it rarely ruled directly. Instead, it operated through military force, economic dependency, and cultural aspiration, sustained by an ideological framework that defined their practices as defending democracy even as they practiced empire. The ideology mattered as much as the interventions themselves. Policymakers presented actions as defending liberal ideals – individual freedom, constitutionalism, private property, consumer choice – while containment theory and Cold War paranoia reframed domination as security. George Kennan’s Long Telegram cast the Soviet Union as expansionist and irrational, creating a worldview where offence became the best defence. Even Henry Kissinger’s realpolitik drew on this logic, masking the replacement of elected governments with dictatorships as the protection of democracy.
To call this imperialism is to see the paradox: the United States claimed to be the exception, a liberator rather than a coloniser, yet its practices reproduced the same structures of dependency and subordination associated with older empires. As Adam Burns argues, American imperialism is part of a long continuum, from territorial expansion to informal empire. The Cold War gave it new form: interventions were justified as universal, even altruistic, but in practice they constrained sovereignty and remade societies along lines favourable to the United States.
Ultimately, recognising these interventions as imperialism is not about painting the US as a villain, but about understanding the contradictions of modern power and the contradiction at the heart of its Cold War role: an informal empire that claimed to defend freedom whilst restricting it.
