End of Democracy in Chile

I have two cats, born on 11 September 2009.  Their names are Salvador and Allende, in memory of perhaps the greatest Latin America democrat and socialist of the twentieth century, Salvador Allende, who died on 11 September 1973 during a military coup that would end his presidency and plunge his country into despotism.

The leader of this US-backed coup, General Augusto Pinochet, brought about destruction far beyond what of his fellow terrorist, Osama bin Laden, would achieve 28 years later.  Bin Laden’s crime was the destruction of two landmark skyscrapers causing the murder of almost 3000 people.  It proved the high point of his murderous career.

By comparison, Pinochet’s crime on 11 September would destroy representative government in Latin America’s long-standing democracy, and the coup itself would mark but the beginning of his career as a sponsor of terrorism.  That concerted, day-to-day terrorism for seventeen years set itself the goal of eliminating all that was decent and progressive in Chilean society.  It would prove appallingly successful in achieving that goal.  As a sideline, the General instructed his agents to carry out various assassinations in several countries (including the murder in 1976 by a car bomb in Washington of Orlando Letelier, President Allende’s Minister of Defense).

During the 38 years from 1932 through the election of Salvador Allende and the Popular Unity government in 1970, the Right, Center and Left contested for electoral power.  So institutionalized seemed the “democratic tradition” in Chile that even weeks before Pinochet’s golpe de estado many Chileans believed that it could not and would not occur.

But it did, to change Latin America from a continent with social democratic promise to the vanguard of the reactionary and near-fascist Right.  Three months before the Pinochet seizure of power, a coup in Uruguay would end that country’s long run of democratically elected governments and usher in savagery to match that in Chile.  Three years later in March 1976 military terror would impose its will in Argentina, ending civilized government in the entire Southern Cone.

(Left) Chilean municipal workers in support of Salvador Allende’s 1964 presidential campaign. (Right) Allende speaking in Santiago, capital of Chile.

Pinochet Economics

A central objective of the criminal regime in Chile was the destruction of civil society and especially trade unions.  The destruction of democracy and the civil organizations that provided the basis for representative government allowed the introduction of an economic regime as brutal as the political one the coup imposed on the Chilean people, “neoliberalismo“.

Today it is hard to remember that time in the 1970s when the doctrines of “free markets”, union destruction and freeing corporations from societal restrains seemed bizarre and an affront to common decency.  Progressives everywhere (not in Chile where no debate was allowed) denounced the elimination of social protection, rapid privatization and brutal union busting carried out by the Pinochet dictatorship.  Little did we realize that a decade later this ideology would achieve a civilized veneer and prevail in country after country despite being the antithesis of democratic values.

What Pinochet’s regime imposed by military force, Reagan and Thatcher would achieve through the electoral process.  In no small part they duplicated Pinochet economics through the destruction of the trade union movements in their countries.  In the United States and United Kingdom violence would also play a key part in that destruction, most obviously in the UK coal miners’ strike of 1984-1985.

It is not surprising that Reagan and Thatcher, the former a thinly-veiled racist and the later an open authoritarian, would follow where Pinochet led in economic policy.  As hard as it may be for those in their thirties and younger to believe, it came as more than a surprise, a shock, when Bill Clinton and Tony Blair adopted what would prove essentially the same economic ideology of “free markets”, freeing corporations from public control.

What had seemed the economics of the gun barrel, privatization, growing inequality and union destruction, became the program of the British Labour Party and consolidated its hegemony over the US Democratic Party.  The elimination of democratic control of economic policy was an integral part of this economic ideology.  The dogma emerged that monetary policy should be the task of the “experts” in the Bank of England and the Federal Reserve.  Government spending should adhere to the draconian rule of a balanced budget, and low taxes were required to encourage “wealth creators” (i.e., the filthy rich themselves).

This left no policy choices for the citizen to make.  On the contrary, the citizen should leave policy to the experts and convert herself and himself into a “consumer”.  As consumer, the erstwhile citizen should loathe the taxes that drain her and his capacity to spend on the “goods” that are the source of all happiness.

Oliver Wendell Holmes, long-serving Justice of the US Supreme Court (and not notably progressive) wrote, “taxes are the price we pay for civilization”.  The globalization of Pinochet economics over four decades replaced civilization with Hobbes’ State of Nature, in which life for the vast majority becomes “solitary, poor, nasty, brutish and short” (Leviathan, Chapter XIII, check it out, though you won’t find many laughs there).

We can speculate whether in 2041 many people will remember Osama bin Laden.  In Pinochet’s case, forty years later the “jury is in” as they say.  From the grave he proclaims himself as the Godfather of the Economics of the 1%.

Two terrorists.

(Left) Osama bin Laden who destroyed the Twin Towers, murdering 2973 people.

(Right) Augusto Pinochet who destroyed the political system of an entire country and held over 11 million people hostage for two decades.  The Rettig Commission in 1991, commissioned by the first post-dictatorship president, numbered the in-Chile murders by the regime at 2279, plus over 40 thousand people victimised by torture while in confinement.

Good news department

Larry Summers, self-styled “smartest person in the room”, withdrew his name from consideration for Chairman of the Federal Reserve System.  As I pointed out in a previous column, this is similar to Dracula withdrawing from consideration as director of research on blood ailments of the Centers for Disease Control and Prevention.  One of my Senators, Bernie Sanders, figured in the opposition to this notorious charlatan.

[See http://therealnews.com/t2/component/content/article/81-more-blog-posts-from-john-weeks/1679-economics-for-the-99-end-of-satire-larry-summers-for-head-of-the-fed]

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John Weeks is Professor Emeritus and Senior Researcher at the Centre for Development Policy and Research, and Research on Money and Finance Group at the School of Oriental & African Studies at the University of London.