Chile under Pinochet
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General Augusto Pinochet was head of the military dictatorship that ruled Chile from 1973 to 1990. The 1973 coup overthrew the socialist government of Salvador Allende. After the coup, the new government abolished democratic institutions, instituted a represive regime and, for the following 17 years, carried out a program of major social changes. Representative government was eventually restored in 1990.
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[edit] Rise to power
On August 22, 1973 the Chamber of Deputies of Chile passed, by a vote of 81 to 47, a resolution calling for President Allende's removal, by force if necessary. The measure failed to obtain the two-thirds vote in the Senate constitutionally required to convict the president of abuse of power, but represented a dramatic challenge to the legitimacy of the elected, Marxist head of state.
The military seized on the widespread discontent and the Chamber's resolution to launch the September 11, 1973 coup d'état (see 1973 coup in Chile) and install themselves in power as a Military Government Junta, composed of the heads of the Army, Navy, Air Force and Carabineros (police).
Once the Junta was in power, General Augusto Pinochet soon consolidated his control over the government. Since he was the commander-in-chief of the oldest branch of the military forces (the Army), he was made the titular head of the junta, and soon after President of Chile.
[edit] Political activity
Following their takeover of power, the Government Junta formally banned the socialist, Marxist and other leftist parties that had constituted former President Allende's Popular Unity coalition. On September 13, the junta dissolved the Congress and outlawed or suspended all political parties. All dissident leaders, from any walk of life, were suspended. All political activity was declared in "recess".
Pinochet expressed contempt for the Christian Democratic Party's call for a quick return to civilian democracy. However, he did not ban the party. Eduardo Frei, Allende's Christian Democratic predecessor as president, initially supported the coup along with other Christian Democratic leaders. Later, they assumed the role of a loyal opposition to the military rulers, but soon lost most of their influence.
Meanwhile, left-wing Christian Democratic leaders like Radomiro Tomic were jailed or forced into exile. The Catholic church, which at first expressed its gratitude to the armed forces for saving the country from the danger of a "Marxist dictatorship" became, under the leadership of Raúl Cardinal Silva Henríquez, the most outspoken critic of the regime's social and economic policies. Nonetheless, even Pope John Paul II has been criticized for his perceived leniency towards the Pinochet regime.
The military junta began to change during the late 1970s. Due to problems with General Pinochet, General Gustavo Leigh was expelled from the junta in 1978 and replaced by General Fernando Matthei. In 1985 due to a scandal, General César Mendoza resigned and was replaced by General Rodolfo Stange.
[edit] Constitution of 1980
Chile's new constitution was approved in a national plebiscite held in September 11, 1980. The constitution was approved by 75% of voters in what has been said by its critics to be "a highly irregular and undemocratic plebiscite."[1] It came into force in March 11, 1981.
[edit] Economy and Free Market reforms
After the military took over the government in 1973, a period of dramatic economic changes began. The Chilean economy was still faltering in the months following the coup. As the military junta itself was not particularly skilled in remedying the persistent economic difficulties, Pinochet appointed a group of economists who had been educated in the United States at the University of Chicago. Given financial and ideological support from Pinochet, the U.S., and international financial institutions, the Chicago Boys advocated laissez-faire, free-market, neoliberal, and fiscally conservative policies, in stark contrast to the extensive nationalization and centrally-planned economic programs supported by Allende. [Valdes, 1995]
Chile was forcefully transformed from an economy isolated from the rest of the world, with strong government intervention, into a liberalized, world-integrated economy, where market forces were left free to guide most of the economy's decisions. This period was characterized by several important economic achievements: inflation was reduced greatly, the government deficit was virtually eliminated, the economy went through a dramatic liberalization of its foreign sector, and a strong market system was established.
From an economic point of view, the era can be divided into two periods. The first, from 1973 to 1982, corresponds to the period when most of the reforms were implemented. The period ended with the international debt crisis and the collapse of the Chilean economy. At that point, unemployment was extremely high, above 20 percent, and a large proportion of the banking sector had become bankrupt. During this period, a pragmatic economic policy that emphasized export expansion and growth was implemented. The second period, from 1982 to 1990, is characterized by economic recovery and the consolidation of the free-market reforms.
Pinochet's policies were lauded internationally for transforming the Chilean economy and bringing about an "economic miracle". British Prime Minister Margaret Thatcher credited him with bringing about a thriving, free-enterprise economy, while at the same time downplaying the junta's human rights record, condemning an "organised international Left who are bent on revenge." Pinochet certainly did achieve macroeconomic success with his reforms, hindered somewhat by recession in the early 1980s. GDP growth remained steady, and Chile began a process of integration into the international economy.
However, there is debate to this day over whether these sweeping economic changes could have been made without the hugely negative impact they had on poorer members of Chilean society.
[edit] 1973-1982
Chile's main industry, copper mining, remained in government hands, but new mineral deposits were open to private investment. Capitalist involvement was increased, pension funds and healthcare were privatized, and Superior Education was also placed in private hands. One of the junta's economic moves was fixing the exchange rate in the early 1980s, leading to a boom in imports and a collapse of domestic industrial production; this together with a world recession caused a serious economic crisis in 1982, where GDP plummeted by 14%, and unemployment reached 33%. At the same time, a series of massive protests were organized, trying to cause the fall of the regime, without success.
[edit] Deflation policy
Inflation was a significant factor plaguing the Chilean economy during and after the Allende years. Between September 1973 and October 1975, the consumer price index rose over 3,000%. In order to combat this persistent problem and pave the way for economic growth, the Chicago Boys recommended dramatic cuts in social services. The junta put the group's recommendations into effect, and cumulative cuts in health funding totaled 60% between 1973 and 1988.
The cuts indirectly caused a significant rise in many preventable diseases and mental health problems. These included rises in typhoid (121%,) viral hepatitis, and an increase in the frequency and seriousness of mental ailments among the unemployed. [2].
Exchange rate depreciations and cutbacks in government spending produced a depression. Industrial and agricultural production declined. Massive unemployment, estimated at 25% in 1977 (it was only 3% in 1972), and inflation eroded the living standard of workers and many members of the middle class to subsistence levels. The under-employed informal sector also mushroomed in size. The long-term goal of reducing inflation was achieved in spite of the aforementioned costs.
[edit] 1982-1990
After the economic crisis of 1982, Hernan Buchi became Minister of Finance from 1985 to 1989. He allowed the peso to float and reinstated restrictions on the movement of capital in and out of the country. He introduced banking legislation, simplified and reduced the corporate tax. Chile pressed ahead with privatizations, including public utilities plus the re-privatization of companies that had returned to the government during the 1982–1983 crisis.
[edit] Macroeconomics
Pinochet's policies led to substantial GDP growth, in contrast to the negative growth seen in the final year of the Allende administation. The upper 20% of income earners ultimately benefitted the most from such growth, receiving 85% of the increase [3]. Foreign debt also grew substantially under Pinochet, rising 300% between 1974 and 1988.
Under these new policies, the rate of inflation dropped from about 1,000% per year to about 10% per year. While this was still a high rate of inflation, it allowed the economy to start recovering. From 1984 to 1990, Chile's gross domestic product grew by an annual average of 5.9%, the fastest on the continent. Chile developed a good export economy, including the export of fruits and vegetables to the northern hemisphere when they were out of season, and commanded high prices.
[edit] Social costs
The economic policies espoused by the Chicago Boys and implemented by the junta initially caused severe damage to the poorest sectors of Chilean society. Between 1970 and 1989, there were large cuts to incomes and social services. Wages decreased by 8%. Family allowances in 1989 were 28% of what they had been in 1970 and the budgets for education, health and housing had dropped by over 20% on average [4]. The massive increases in military spending and cuts in funding to public services coincided with falling wages and steady rises in unemployment, which averaged 26% in the years 1982–1985 [5] and eventually peaked at 30%.
The economy grew rapidly from 1976 to 1981, fueled by the influx of private foreign loans until the debt crisis of the early 1980s. But despite high growth in the late 1970s, income distribution became more regressive. While the upper 5% of the population received 25% of the total national income in 1972, it received 50% in 1975. Wage and salary earners got 64% of the national income in 1972 but only 38% at the beginning of 1977. Malnutrition affected half of the nation's children, and 60% of the population could not afford the minimum protein and food energy per day. Infant mortality increased sharply. Beggars flooded the streets.
The junta's economics also ruined the Chilean small business class. Decreased demand, lack of credit, and monopolies engendered by the regime pushed many small and medium size enterprises into bankruptcy. The curtailment of government expenditures created widespread white-collar and professional unemployment. The middle class began to rue its early support of the junta, but appeared reluctant to join the working class in resistance to the regime.
The junta relied on force, the oligarchy, huge foreign corporations, and foreign loans to maintain itself. Under Pinochet, funding of military and internal defence spending rose 120% from 1974 to 1979. Due to the reduction in public spending, tens of thousands of employees were fired from other state-sector jobs. [6] The oligarchy recovered most of its lost industrial and agricultural holdings, for the junta sold to private buyers most of the industries expropriated by Allende's Popular Unity government. This period saw the expansion of monopolies and widespread speculation.
Financial conglomerates became major beneficiaries of the liberalized economy and the flood of foreign bank loans. Large foreign banks received large sums in repayments of interest and principal from the junta; in return, they lent the government millions more. International lending organizations such as the World Bank, the IMF, and the Inter-American Development Bank lent vast sums. Foreign multinational corporations such as International Telephone and Telegraph (ITT), Dow Chemical, and Firestone, all expropriated by Allende, returned to Chile.
[edit] Foreign relations
The new junta quickly broke off the diplomatic relations with Cuba that had been established under the Allende government. Having come to power with the self-proclaimed mission of fighting communism, Pinochet found common cause with the military dictatorships of Bolivia, Brazil, Paraguay, Uruguay, and later, Argentina. The six countries eventually formulated a plan that became known as Operation Condor, in which one country's security forces would target suspected "Marxist subversives", guerrillas, and their sympathizers in the allied countries.
Pinochet's government received tacit approval and material support from the United States. The exact nature and extent of this support is disputed. (See U.S. role in 1973 Coup, U.S. intervention in Chile and Operation Condor for more details.) It is known, however, that the American Secretary of State at the time, Henry Kissinger, practiced a policy of supporting coups in nations which the United States viewed as leaning toward Communism.[citation needed]
The U.S. was significantly friendlier with Pinochet than it had been with Allende, and continued to give Chile substantial economic support between the years 1973–1979, while simultaneously expressing opposition to the junta's repression in international forums such as the United Nations. The U.S. went beyond verbal condemnation in 1976, after Orlando Letelier's murder in Washington D.C., when it placed an embargo on arms sales to Chile that remained in effect until the restoration of democracy in 1989. Presumably, with international concerns over Chilean internal repression and previous American hostility and intervention regarding the Allende government, the U.S. did not want to be seen as an accomplice in the junta's "security" activities. Prominent U.S. allies Britain, France, and West Germany did not block arms sales to Pinochet, benefitting from the lack of American competition. [7]
Apart from operation Condor which linked South American dictatorships, problems with Argentina coming from the 19th century reached a high in 1978, with disagreements over the Beagle Canal, and a war was almost started over a confrontation on some strategic islands within it. In 1982, Chilean-Argentine relations worsened once more because Chile along with Colombia, were the only countries in Latin America not to support Argentina in its war with the U.K. over the Falkland Islands, and Chile actually helped the United Kingdom during the war. The two countries (Chile and Argentina) finally agreed to papal mediation over the Beagle canal that finally ended in the Argentina-Chile Peace and Friendship Treaty of 1984.
[edit] Foreign aid
The previous drop in foreign aid during the Allende years was immediately reversed following Pinochet's ascension; Chile received USD $322.8 million in loans and credits in the year following the coup [8]. There was considerable international condemnation of the military regime's human rights record, a matter that the United States expressed concern over as well.
[edit] Human Rights violations
The military rule was characterized by systematic suppression of all leftist opposition, which led some to speak of a "politicide" (or "political genocide"). The worst violence occurred in the first 3 months of the coup's aftermath, with the number of suspected leftists killed or "disappeared" soon reaching into the thousands. In the days immediately following the coup, the National Stadium was used as a concentration camp holding 40,000 prisoners. Some of the most famous cases of "desaparecidos" are Charles Horman, a U.S. citizen who was killed during the coup itself, Chilean songwriter Víctor Jara, and the October 1973 Caravan of Death (Caravana de la Muerte) were at least 70 persons were killed.
Following Pinochet's defeat in the 1989 plebiscite, the 1991 Rettig Commission, a multipartisan effort from the democratic governments to discover the truth about the allegations, listed a number of torture and detention centers (such as Colonia Dignidad, Esmeralda ship or Víctor Jara Stadium), and found that at least 3,000 people were killed or disappeared by the regime.
A later report, the Valech Report (published in November 2004), confirmed the figure of 3,000 deaths but dramatically reduced the alleged cases of disappearances. It tells of some 28,000 arrests in which the majority of those detained were incarcerated and in a great many cases tortured. Many were exiled and received abroad, in particular in Argentina, as political refugees; however, they were followed in their exile by the DINA secret police, in the frame of Operation Condor which linked South-American dictatorships together against political opponents.
Chile under Pinochet was a key participant in the Operation Condor, a campaign of assassination, intelligence-gathering and counter-terrorism, conducted jointly by the Chilean security services and those of Argentina, Bolivia, Brazil, Paraguay, and Uruguay in the mid-1970s. The military governments of these respective countries contended that they were neutralizing leftist subversives, but their definition of the term was extremely broad, and their operations were known to target many political dissidents. Many Chilean exiles were followed and murdered by DINA or allied secret services.
According to the Latin American Institute on Mental Health and Human Rights (ILAS), "situations of extreme trauma" affected about 200,000 persons; this figure includes individuals killed, tortured (following the UN definition of torture), or exiled and their immediate families. While more radical groups such as the Movement of the Revolutionary Left were staunch advocates of violent Marxist revolution, it is currently accepted that the junta deliberately targeted nonviolent political opponents as well, making it an archetype of state terrorism.
[edit] Plesbicite and return to civilian rule
According to the transitional provisions of the 1980 Constitution, a plebiscite was scheduled for October 5, 1988, to vote on a new eight-year presidential term for Pinochet. The Constitutional Tribunal ruled that the plebiscite should be carried out as stipulated by the Law of Elections. That included an "Electoral Space" during which all positions, in this case two, Sí (yes), and No, would have two free slots of equal and uninterrupted TV time, simultaneously broadcast by all TV channels, with no political advertising outside those spots. The allotment was scheduled in two off-prime time slots: one before the afternoon news and the other before the late-night news, from 22:45 to 23:15 each night (the evening news was from 20:30 to 21:30, and prime time from 21:30 to 22:30). The opposition No campaign, headed by Ricardo Lagos, produced colorful, upbeat programs, telling the Chilean people to vote against the extension of the presidential term. Lagos, in an interview, called on Pinochet to account for all the "disappeared" persons. The Sí campaign did not argue for the advantages of extension, but was instead negative, claiming that voting "no" was equivalent to voting for a return to the chaos of the UP government.
Pinochet lost the 1988 referendum, where 55% of the votes rejected the extension of the presidential term, against 43% for "Sí", and, though a plebiscite is technically non-binding, this one triggered multi-candidate presidential elections in 1989 to choose his replacement. Open presidential elections were held the next year, at the same time as congressional elections that would have taken place in either case. Pinochet left the presidency on March 11, 1990 and transferred power to Patricio Aylwin, the new democratically elected president. Due to the same transitional provisions of the constitution, Pinochet remained as Commander-in-Chief of the Army, until March 1998.
[edit] Legacy
Following the restoration of Chilean democracy and during the successive administrations that have followed Pinochet, the Chilean economy has prospered, and today the country is considered a Latin American success story. Unemployment stands at 8.5% as of 2003, with poverty estimated at 20.6% for 2000, both low numbers for the region. [1]
Supporters of Pinochet's economic policies contend that the three successive administrations following him contributed to this success by maintaining and continuing the reforms initiated by the junta, but the link between Pinochet's policies and the 1990s boom remains a subject of controversy.
The "Chilean Variation" is still seen by many as the potential model for nations that fail to achieve significant economic growth. The latest is Russia, for whom David Christian warned in 1991 that "dictatorial government presiding over a transition to Capitalism seems one of the more plausible scenarios, even if it does so at a high cost in human rights violations" [9].
[edit] Additional information
[edit] See also
[edit] References
- David Christian (1991). "Perestroika and World History", Published in Australian Slavonic and East European studies Macquarie University (Sydney, Australia).
- Falcoff, Mark (2003). "Cuba: The Morning After", p. 26. AEI Press, 2003.
- Petras, J., & Vieux, S. (1990). "The Chilean 'Economic Miracle"': An Empirical Critique", Critical Sociology, 17, pp. 57-72.
- Roberts, K.M. (1995). "From the Barricades to the Ballot Box: Redemocratization and Political Realignment in the Chilean Left", Politics & Society, 23, pp. 495-519.
- Schatan, J. (1990). "The Deceitful Nature of Socio-Economic Indicators". Development, 3-4, pp. 69-75.
- Sznajder, M. (1996). "Dilemmas of economic and political modernisation in Chile: A jaguar that wants to be a puma", Third World Quarterly, 17, pp. 725-736.
- Valdes, J.G. (1995). Pinochet's economists: The Chicago School in Chile, Cambridge: Cambridge University Press.
- Steve Anderson Body of Chile's Former President Frei May Be Exumed, The Santiago Times, April 5, 2005
