Chile, neoliberalism and discontent

Chile is the birthplace of neoliberalism. It is the country where this damaging economic system was first imposed. In the years since the departure of Augusto Pinochet from La Moneda Palace, the ‘reforms’ that he forced onto the Chilean people remain almost completely intact. None of the successive left-ish governments had the courage or the decency to truly change things beyond the piecemeal. Granted, while Pinochet was still alive, he remained a threat and a rallying point for his followers and could call on his old friends in the military to intervene should these governments swing too far to the left. He also made himself Senator-for-life, a role that he was forced to relinquish after he’d  returned to Santiago after his house arrest in Surrey pending charges of human rights abuses in Spain.

But the chickens have come home to roost in this Freidmanite free market paradise. Three months ago, classroom boycotts by students and pupils led to mass student protests that have morphed into general protests against the right wing (some would say pale Pinochetista) government of Sebastian Piñera. A general strike was called for this week.

Today, during the second day of strikes and demonstrations, a 16 year old boy was shot dead by the police and nearly 1400 people have been arrested. Scores of people have been injured.

The Guardian says,

President Sebastian Pinera’s ministers played down the significance of the protests. Police estimated Santiago’s crowds at just 50,000 and said only 14% of government employees stayed off work.

Union leaders claimed 600,000 people joined demonstrations nationwide. Raul de la Puente, president of the government employees union, said 80% of his members joined the strike, at the cost of two days’ pay.

Pinera said the strike was unjustified, claiming Chile‘s economy was growing strong and providing more opportunities. He said he remained open to those seeking dialogue, although his administration has refused to discuss some student and union demands, arguing the real work of reform must be done in Congress.

Does any of this look familiar? It should. Lord Snooty said, when public sector workers went on strike over pensions in June, that the strikes were “unjustified”. Here’s what The Economist says,

The students want education, which in Chile relies heavily on private funding, to be turned into a non-profit, state-dominated, system. The unions want the mostly private pension system to be supplemented with more state provision. They also want changes in labour laws and an increase in business taxes to pay for more social spending. And they are demanding a new constitution. Like many of the things the protesters want changed, the constitution dates from the 1980s and the dictatorship of General Pinochet (although many of its clauses have since been amended).

Remember, this is Chile. Yet the Tory-led government want to pursue exactly the same course. People can read the riots in this country as purely criminal acts of looting and violence. In a society where conspicuous consumption is idealized and wages have stagnated and the cost of living has spiralled, those riots can be seen as economic rebellions. This is what is currently taking place in Chile.

Oddly enough, there is no mention of the protests in Chile on the Daily Telegraph website. I have checked its Chile section and there is nothing.

Piñera’s government is in denial. The Financial Times tells us that,

Rodrigo Ubilla, interior ministry undersecretary, said it had turned out to be “a big failure” with low turnout and most of the country working normally.

But Chile is not working normally. Three months of protests by university students demanding free education have exposed festering social sores.

Further down the article, Sebastian Aguilera of the Economist Intelligence Unit said,

the Pinochet-era foundations for healthcare, pensions and education “were experiments, back in the day. Some go right and some go wrong. I wouldn’t say the education system is a failure, far from it. But it certainly is not fair”.
The FT article also notes
Mr Piñera has two other problems. One is the renewed spectre of Pinochet. That was always going to be a problem – his is the first government of the right in more than half a century and although Mr Piñera himself is more to the centre-right, some in his entourage have been saying very dictatorship-era sounding things lately.

I reported in this blog how Piñera had appointed some former Chicago Boys to his cabinet.

The left-ish Concertación electoral bloc isn’t faring too well either. Like the Labour Party in opposition here, it has failed to take the lead. Indeed, it followed the post-Pinochet governance formula. Labour, under Blair, stuck to the neoliberal formula of the Thatcher and Major governments. It is in a similar moral and political bind under the leadership of Ed Miliband.

Here’s a Euronews report

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Filed under Chile, Economics, neoliberalism, World

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