Saturday, January 18, 2020

Chile: the limits of ultra-liberalism

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Editorial. Chile is a rich country. But the privatization of key sectors has perpetuated a chasm of inequality that affects the middle classes.

Time to Reading 2 min.

A police car in front of protesters, in Santiago, Tuesday, October 22, 2019. MARTIN BERNETTI / AFP

Editorial of the "World". Presented again recently by its president, Sebastian Piñera, as an oasis of stability in a Latin America boiling, Chile is plagued, since Friday, October 18, to spontaneous popular riots which the spring is obvious: Abyssal social inequalities and the disconnection of political leaders from reality. Ecuador, Lebanon, Iraq … This scenario is at work these days in several points of the globe. The France of "yellow vests" is not spared, any more than Britain, where the Brexit peacefully translates a deep social grumbling.

But the Chilean context is very specific: ultra-liberalism, which dominates the management of the economy and society, has hardly been called into question since the end of the Pinochet dictatorship (1973-1990). The privatization of key sectors such as health, education, transport and water has generated and perpetuates a chasm of inequalities that affects the middle classes.

Private health insurance reimbursements are minimal and only a small minority of Chileans benefit from quality private hospitals. Students go into debt for decades to finance their studies at private universities, and the funded pension system combines exorbitant contributions and derisory pensions.

Read the analysis: In Chile, "there is no hope that the neoliberal model of development will bear fruit"

Daily casseroles

In recent years, social movements have denounced this situation. But current riots are of a magnitude never seen since the end of the dictatorship. In a derisory manner, the increase in the price of the metro ticket in Santiago, from 800 to 830 pesos (0.98 to 1.02 euros), a vital means of transport in a megacity of 7.6 million inhabitants, has served as a trigger. Its cancellation by the government did not prevent the protests from continuing and amplifying. Gatherings and cacerolazos (cookware concerts) are daily.

The use of the army, which patrols the streets for the first time since the fall of Pinochet, and the violence of repression have only fueled anger. In the face of fire and looting, the state of emergency was declared in the capital and nine of the sixteen regions of the country, and a curfew imposed. Fifteen people died under police fire or during fires and looting of shopping centers. More than 2,600 people were arrested.

Read the testimonials: "President, Chileans want change, not words"

President Piñera, 69, elected in late 2017 and who has already been in power between 2010 and 2014, announced Tuesday evening a series of social measures, including the increase of 20% of the minimum pension. He acknowledged "a lack of vision" and asked "forgiveness". But he personifies the system that is denounced and the caste of the 1% of the population that concentrates 25% to 30% of wealth. Billionaire, it was enriched during the dictatorship and defends widespread private management of basic services, the lack of social safety nets and labor legislation that, little reformed since Pinochet, perpetuates precariousness.

Chile, the fourth largest economy in Latin America, is a rich country. It boasts an enviable growth rate: 4% in 2018 and 2.5% expected this year. It has the means to fill the "brecha", this social breach that feeds malaise and violence. Provided that the state plays its role of protection and guarantees quality public services. Reforms that, in Chile, imply profound changes to the ultra-liberal Constitution of 1980, whose provisions limiting the role of the state in the economy have remained unchanged since the dictatorship.

Read the interview: "The uprising in Chile is the product of forty years of neoliberal orthodoxy"

The world

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