If You Want Change, Look to the Youth: Lessons for Chile's Struggle Against Inequality

Thirty years after the dictatorship of Augusto Pinochet, Chile is in the middle of an economic and political crisis, the roots of which can be found in the neo-liberal model initiated by the Pinochet regime.

 

The Chilean people’s protest, which began in October 2019 against a 30 peso hike in metro fares, has refused to die down. The protestors, who have been opposing the current government’s austerity measures, feel that they have not received the benefits of the country’s economic progress, and have intensified their protest to include demands for improvements in healthcare, education, and wages.

Barring natural disasters, this is the first time since Augusto Pinochet demitted office that a state of emergency has been declared in Chile. The current government, led by Sebastián Piñera, declared the situation “war-like with a powerful and uncompromising enemy” and cracked down heavily on protestors. The major cities of Santiago, Valparaíso, and Concepción, among others, were all placed under emergency conditions.

Reckoning with Inequality

A New York Times article remarked that Chile was “one of Latin America’s most prosperous and politically stable countries,” which was being “rocked by protests, and looting amid a reckoning over inequality (Londono 2019).” According to the World Bank[1], Chile is one of Latin America’s fastest-growing economies and has seen a significant reduction in poverty in recent decades. Between 2000 and 2017, the population living below the poverty line ($4 per day) decreased from 31% to 6.4%. If the country is moving ahead, as shown by recent data and emphasised by Western commentators, then why is there such widespread discontent? One of the main reasons is the existing income equality, which is the second-highest in Latin America after Costa Rica.

A 2018 report by the Organisation for Economic Co-operation and Development (OECD) stated Chile’s ability to improve living standards is challenged by low and stagnant productivity and a still-high level of inequality. In the same report, the OECD states that even though spending on social welfare and education has increased, more investment is required in these sectors to reduce the income gap (OECD 2018).

Table 1: Distribution of Monthly Income across Economic Groups

Group Percentage Income (in Chilean Peso) Equivalent in $
AB 1 64,52,000 8,358
C1a 6 27,39,000 3,548
C1b 6 19,86,000 2,573
C2 12 13,60,000 1,762
C3 25 8,99,000 1,165
D 37 5,62,000 728
E 13 3,24,000 420

Source: Emol.

From Table 1, approximately 50% of the population belongs to the lower stratum of society, while only 1% of the population accrues around 45% of total wealth. The notion of Chile as a “prosperous nation,” thus, is hollow. The rise in metro fares was the last trigger against the capitalist and neo-liberal socio-economic model initiated during Pinochet’s regime and perfected by successive democratically elected governments.

A History of Political Turmoil in Chile

The coup d’état in September 1973 overthrew the constitutional government of “Unidad Popular,” a coalition of political parties and movements of the left and extreme left and marked the beginning of Pinochet’s dictatorial regime, which lasted until 1990. Chilean society underwent profound transformations during this time, with changes felt in political, economic, social, institutional, and cultural sectors. From the Pinochet years emerged a “new society,” one that was based on a style of development where the relation between the society, the market, and the state changed; the productive axes—the relation between the local and global market, and the role of some key actors in society (state, executives, political parties, and workers unions, for example) were modified. Development was quantified in terms of high economic growth, and capitalism in Chile built new forms of expansion and accumulation. The idea of a benefactor state was abandoned, and the market was permitted to fulfil a central role in the regulation of education, health, and other welfare services.

Pinochet reduced fiscal expenditure, imposed the current model of pension funds, and generated ideal conditions to privatise basic services, such as electricity, water (privatised by the centre-left government of Eduardo Frei), education, and also the pseudo-privatisation of roads.    

With the fall of the Pinochet regime and the introduction of democracy in 1990, the Chilean population hoped that the political class would restructure the prevailing economic and political model. However, the centre-left political coalition, Concertación de Partidos por la Democracia, that ruled between 1990 and 2010, was primarily dedicated to maintaining and correcting this inherited neo-liberal structure (Saavedra 2014). Even though the last 10 years have seen Chile alternate between the right (“Coalición por el Cambio”) and the left (“Nueva Mayoría”), both sides have only introduced minor modifications to the neo-liberal model that have been insufficient in reducing the prevailing inequality.

Piecemeal Compromises Rejected

Piñera, after being severely criticised for his heavy-handed approach to the civil unrest, adopted a more conciliatory tone towards the protestors. In an address from the presidential palace in Santiago on 22 October 2019, Piñera apologised for his “lack of vision” in failing to understand the income divide between classes. He has since announced a series of changes in his government’s welfare policies. He has announced an increase in guaranteed minimum income from 3,01,000 pesos to 3,50,000 pesos, reduced working hours from 45 to 40 hours per week, increased monthly pensions from 1,10,201 pesos to 1,32,241 pesos, reversed a recent decision to hike electricity fares by 9.2%, and also increased taxes for anyone who earns above $11,000 per month. However, citizens are rejecting these measures as merely a means to plaster over deep social and economic unrest. Although Piñera has said that peaceful protests are a "civil right," his government spent $1,454,893 on tear gas within the first 10 days of social unrest (Massai 2019). On 1 March 2020, he emphasised the need to strengthen the police force and also proposed introducing new laws to prevent the damage of public infrastructure (El Mostrador 2020).

What these protests have done is to demonstrate that true democracy cannot function with the unfair distribution of wealth. Joel Hernández, Vice President of the Inter-American Commission on Human Rights, described the protests as a “pressure cooker which went off reflecting the anger of people against public policy and the economic situation (Larsson 2019).” As per the latest count, 31 people have lost their lives (two protestors have died in police custody), and over 5,000 people have been arrested (Fiscalia 2020).

If You Want Change, Look to the Youth

Adults who protest today belong to a vibrant culture of student-led protests and are descendants of those who risked their lives to fight against the Pinochet rule. Chile has strong precedence for student-led mobilisations. In 1985, during the Pinochet regime, students mobilised against the unfair destribution of funds among state universities. In 1997, students protests were related to public university financing, the “mochilazo” of 2001 was to demand free student passes for transport. The 2006 "Penguin Revolution," a turning point for student protests, stemmed from issues such as pending government reforms, high fees for entrance exams, and also issues of students access to transport. This "revolution" grew into a critique of the education system and also of the "Ley Orgánica Constitucional de Enseñanza (Organic Constitution Law of Education[LOCE])," which allowed third parties to run school administration and did not hold them accountable for the quality of education.

The force of these movements led to the LOCE being repealed and replaced in 2009 with the General Law of Education (LGE), which introduced significant changes in the process of admission, in curriculum, and in the official recognition of educational establishments. It also enshrined access to “quality education” and strongly restricted the attributions of establishments that favoured discrimination against students in the selection process for economic reasons. Students in Chile continue to fight, and between 2011 and 2013, secondary school students and university students, along with professors, took to the streets to make their voices heard against structural issues with Chile's education.

Creating a 'New' Chile 

Currently, the demands of the Chilean population are transversal. Measures proposed by the current government are, at best, palliative and do not address the root problem. Chile’s current socio-economic model is deeply flawed, and the political class is unwilling to overhaul it to protect their own privileges—something that Chileans are aware of. This is perhaps why even some members of the upper classes support the movement. To solve the problems of social and economic inequality, politics in Chile needs to be reformulated, and an agenda needs to be set for the next years.

 

 

 

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