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Title: Pinochet: Dead at last
Author: Anarcho
Date: December 12, 2006
Language: en
Topics: Pinochet, obituary, neoliberalism
Source: Retrieved on 28th January 2021 from https://anarchism.pageabode.com/?p=136][anarchism.pageabode.com]] and on 28th October 2021 from [[http://www.anarkismo.net/article/4437
Notes: One less evil dictator in the world. An evaluation of Pinochet’s neo-liberal regime.

Anarcho

Pinochet: Dead at last

For lovers of freedom, 2006 has been a good year with P.W. Botha, Milton

Friedman and now General Pinochet shuffling off this mortal coil.

Pinochet was the head of the military dictatorship which overthrew (with

the aid and backing of the CIA) the democratically elected Chilean

government of Marxist Salvador Allende on September 11^(th), 1973.

Officially,his troops killed or disappeared over 3,000 people (according

to Human Rights and Church groups, it is over 10,000). Thousands were

tortured and tens of thousands went into exile.

The standard defence of the regime was that it stopped Chile becoming a

socialist state. Did Pinochet stop Chile sliding into “Communist

dictatorship”? No, but he did stop the Chilean working class from its

attempts to expand liberty by taking over their workplaces, land and

communities. As the Situationist group PointBlank! noted, “Allende was

overthrown, not because of his reforms, but because he was unable to

control the revolutionary movement which spontaneously developed at the

base of the UP.” (“Strange Defeat: The Chilean Revolution,1973”)

What was shocking for many on the liberal and labourite left was that

Chile had South America’s strongest democratic traditions. If it could

happen there, it could happen here they thought (and in the context of

the 1970s, this was a real possibility). However, Thatcher’s election

and subsequent mishandling of the economy broke the back of working

class resistance. While state repression was required to break the

miners strike, the need for a coup had declined as Thatcher had ensured

that workers were forced to take the road to serfdom after tasting

freedom in the rebellious’70s.

Pinochet would probably have went down in history as yet another

blood-soaked military dictator except for one thing, his embrace of

Milton Friedman’s economic ideology. Due to this, Chile became a

test-case for what became known as neo-liberalism and it has been used

as a template around the world for economic “reform”, including here

under Thatcher. The results have been remarkably consistent and very far

from the “economic miracle” proclaimed by the “free-market” right. In

fact, the reality was radically different and hardly “miraculous” unless

you were wealthy. As one expert summarises, Chilean workers “were

central target’s of political repression and suffered greatly from his

state terror. They also paid a disproportionate share of the costs of

his regime’s regressive social policies. Workers and their organisations

were also the primary targets of Pinochet’s labour laws and among the

biggest losers from his policies of privatisation and

deindustrialisation.” (Winn, Peter (ed.), Victims of the Chilean

Miracle: Workers and Neoliberalism in the Pinochet Era, 1973–2002, p.

10)

After a deep recession caused by applying Monetarist shock-treatment in

1975 (the economy fell by 13%), it started to rebound. This is the

source of claim of a Chilean “economic miracle.” Friedman, for example,

used 1976 as his base-line, so excluding the depression year of

1975which his recommended shock treatment had deepened. This is

dishonest as it fails to take into account not only the impact of

neo-liberal policies but also that a deep recession often produces a

vigorous upsurge – particularly is workers are too terrified to ask for

pay rises. Ironically, soon after Friedman proclaimed his “miracle” the

bottom fell outof the economy and Chile’s GDP fell 14% in 1982.

The crisis forced the regime to abandon its Monetarist dogmas and

bailout the capitalist class. The economy finally stabilised in 1986,

but at a cost paid by the country’s workers: “By 1988, the average real

wage had returned to 1980 levels, but it was still well below 1970

levels. Moreover, in 1986, some 37 percent of the labour force worked in

the informal sector, where wages were lower and benefits often

non-existent. Many worked for minimum wage, which in 1988 provided only

half of what an average family required to live decently — and a fifth

of the workers didn’t even earn that ... nearly half of Chileans lived

in poverty.” (Winn, p. 48) The level of state intervention pursued by

Pinochet’s regime post-crash made opponents talk of “the Chicago road to

socialism.” Working class people, on the other hand, faced state

repression after taking to the streets in response to the crash.

Between 1970 and 1990, Chile’s total GDP grew by a decidedly average 2%

a year. The average growth in GDP was 1.5% per year between 1974 and

1982, which was lower than the average Latin American growth rate of

4.3% and lower than the 4.5% of Chile in the 1960’s. For the 1981–90

period, it was just 1.84% a year. Hardly an economic miracle,

particularly once the social costs thrust upon the terrorised population

are taken into account (unsurprisingly, Friedman’s Chilean followers

affirmed that “in a democracy we could not have done one-fifth of what

we did.”)

Somewhat ironically, Chile provided substantial empirical evidence to

refute Friedman’s own capitalist ideology. In “Capitalism and Freedom”,

he asserted that the more capitalist a country, the more equal it was.

Inequality under Pinochet soared to record levels and Chile went from

the second most equal to the second most unequal society in South

America. The “distribution of income in Chile in 1988,after a decade of

free-market policies, was markedly regressive.” Between 1978 and 1988

the richest 10% of Chileans increased their share of national income

from 37 to 47%, while the next 30% saw their share shrink from 23 to

18%. The income share of the poorest fifth of the population dropped

from 5 to 4 %. Overall, “wages stayed low even as the economy began to

recover. Low wages were key to the celebrated ‘miracle’ recovery ... The

average wage ... was 5 percent lower at the end of the decade than it

had been in 1981 and almost 10 percent lower than the average 1970

wage.” After 1982, “stagnant wages and the unequal distribution of

income severely curtailed buying power for most Chileans, who would not

recover 1970 consumption levels until 1989.” (John Lear and Joseph

Collins, “Working in Chile’s Free Market”, pp. 10–29, Latin American

Perspectives, vol. 22, No. 1, p=2E 26, p. 21 and p. 25)

Friedman had also been at pains to attack trade unions and the idea that

they defended the worker from coercion by the boss. Nonsense, he

asserted, the “employee is protected from coercion by the employer

because of other employers for whom he can work.” Chile refuted that

notion, for “in wake of the coup, factory owners suddenly had absolute

control over their workers and could fire any worker without case=2E

From 1973 through 1978, practically every labour right for organised and

unorganised workers was suspended. All tools of collective bargaining,

including of course the right to strike, were outlawed.” After1978, the

labour code designed by Friedman’s acolytes made it extremely difficult

to strike, particularly as “employers could count on the backing of the

military in any conflict with workers.” (Lear and Collins, p. 13)

Which refutes Friedman’s attempts to support the economic policies of

the regime while paying lip-service to criticising its dictatorial

nature=2E It staggers belief that any intelligent person could argue

such a position, given that the political system must have an impact on

the economic system. If the former is authoritarian, it would be hardly

surprising to discover that the economy, at least for workers, would

also be authoritarian. Given that workers faced a visit from the secret

police if they got uppity, it is clear that there was no “economic

liberty” for them. To state otherwise simply shows that the person has

no concept of what liberty means – but, then, Friedman was an ideologue

for capitalism so this can be taken for granted.

It is true that the atomised labour market produced by state terror did

approximate the neo-classical ideal as there were no or weak unions and

workers were unwilling to take collective action. The results, as noted

above, were only a “miracle” for the bosses. Any link between

productivity and wages went out the window. Even in the 1990s, there is

evidence that productivity growth outpaced real wage growth by as much

as a ratio 3:1 in 1993 and 5:1 in 1997. (Winn, p. 73) Being able to seek

a new job did not stop exploitation particularly as Chile (yet again!)

refuted another of Freidman’s assertions about capitalism, namely that

people would “be surprised how fast people would be absorbed by a

growing private-sector economy.” In fact, unemployment reached record

levels for decades. During the 1960s it had hovered around 6%; by

contrast, the unemployment level for the years 1974 to 1987 averaged 20%

of the workforce. Even in the best years of the boom (1980–1981) it

stayed as high as 18%. (Lear and Collins, p. 22)

The only miracle about Chile’s economy is how anyone with any knowledge

or intellect could claim it was an “economic miracle” based on “economic

liberty.”

Chile is now a democracy. However, the legacy of Pinochet still remains.

Over a quarter of the Senate are “designated” including four retired

military officers named by the National Security Council. He also

imposed a “unique binomial electoral law, [in] which to elect two

deputies or senators from the same district, a party or electoral

alliance needed to double its opponent’s vote — a difficult feat — or

else the opponent received an equal number of seats in congress.” This

ensured rightist control of the Senate despite a decade of majority

victories by the centre-left in elections. Pinochet threatened on 11

September 1990 that he would lead another coup is conditions warranted

it. Three years later, he ordered combat-ready troops onto the streets

for an “exercise” when investigations into an arms procurement scandal

implicated his son. Even with a controlled democracy, “Pinochet

maintained an army ‘shadow cabinet’ that acted as a political pressure

group.” However, the new centre-left governments have managed some

reforms. For example, through targeted social spending” the new

government “was able to halve the 1988 45 percent poverty rate

bequeathed by Pinochet.” (Winn, p. 64, p. 50 p. 52)

It is one of the ironies of life that Pinochet died on Human Rights day.

That the dictator never saw his day in court is unsurprising, given how

popular he was in elite circles and how he ensured that “democratic”

Chile was bound by his will. He was a murderous thug whom no sane and

civilised person could feel any emotion bar hatred or disgust for. That

the right-wing embraced him so fully (while paying lip-service to

condemning his political regime) says a lot about them. It also shows

how little they are concerned about logic, empirical evidence and

(needless to say) liberty.