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Chile’s 9/11, Fifty Years Later by Sebastián Edwards [1]

['Sebastián Edwards', 'James Livingston', 'Harold James']

Date: 2023-09-08 08:02:00+00:00

I welcome Professor Edwards’ condemnation of Pinochet's human rights abuses but, in my view, his economic narrative is deeply misleading. Here are some counterarguments to consider.

(1) President Allende's economic program was subject to economic sabotage, sponsored by Chile's elites and the USA. The 1972 trucker strike (sponsored by the CIA) paralyzed the economy & caused inflation to soar; US multinational corporations went on an investment strike (also with US government support); and there was a stop on buying Chilean copper which crushed Chile's foreign exchange earnings. Allende's program might have failed anyway, but let's be honest about the economic sabotage that we do know about. It is doubtful any developing economy could survive such an assault, especially when coupled with an elite intent on sabotaging success.



(2) Chile was subject to two rounds of "Chicago Boys" shock therapy. The first round (1975-1982) ended in a catastrophic economic crisis. That was followed by a second round which proved more macroeconomically successful. That success was based on inserting Chile into the emerging Neoliberal globalized economy by making Chile a haven for international capital. It involved suppressing domestic politics, suppressing the wage share, and raising the capital share. During this "successful" period, income inequality & poverty soared.



(3) There has been some reduction of inequality since 2010 (i.e., after the 15 year-long post-Pinochet constitutional transition arrangement ended). However, I would argue Chile's better situation is because its economic model fits with Neoliberal globalization & not because the model is good.



(4) In sum, Pinochet is the posterchild for the evils of dictatorship. The Chilean economy is the posterchild for the economic contradictions of Neoliberalism, in which the "best" perform badly & their only claim to merit is that some perform worse. And the coup against Allende provides a window on the realities of US foreign policy, which remains relevant today given developments in Ukraine.

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[1] Url: https://www.project-syndicate.org/onpoint/pinochet-coup-50th-anniversary-by-sebastian-edwards-2023-09?utm_source=Project+Syndicate+Newsletter&utm_campaign=2d14adfc0c-op_newsletter_09_08_2023&utm_medium=email&utm_term=0_73bad5b7d8-2d14adfc0c-93566737&mc_cid=2d14adfc0c&mc_eid=3216b5bc39

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