Chile before and after Monetarism

Abstract

When the Popular Unity government of Salvador Allende was overthrown in 1973, Chile was turned into a testing ground for monetarist economic theory. The tragic failure of that model, in political, social and economic terms, has recently prompted a chain reaction among the disciples of Milton Friedman, who have, in various degrees, denied responsibility, and expressed sympathy for the experiment's disappointing results. Although monetarism has become, in the last ten years, the order of the day in several Latin American countries, especially in Brazil, Uruguay, and Argentina, as well as Chile, it is in Chile that it could be found in its purest form, and where the social and economic restructuring has been most complete. Yet this was not the first model of social engineering applied in Chile. In no other Latin American country have so many experiments taken place during the last forty years, each of them attracting widespread interest in the political establishments of the Third World, Europe, and the United States for different, but equally compelling, reasons. In 1938 Chile elected the first and only Popular Front government in Latin America, a phenomenon previously associated only with Spain and France. This alliance, between primarily working class Communists and Socialists and middle class Radicals, captivated the imagination of the elites of Latin America as a new political strategy to combat the problems of economic and political underdevelopment. In the United States, however, the Chilean Popular Front was seen as the first symptom ofthe malaise of'leftism', and therefore attacked and condemned from the very start. Later experiments would include the election of a populist-nationalist, anti-party President (Carlos Ibanez, 19521958), the first Christian Democratic government in Latin America (Eduardo Frei, 1964-1970), and the first self-professing Marxist head of state in the western hemisphere (Salvador Allende, 1970-1973). It is not surprising, therefore, that an examination of recent articles reveals interest in Chile to be high on the agenda of academics all over the world. Naturally enough, the character and actions of the military government headed by General Augusto Pinochet have merited and still merit the greatest attention, but other subjects have also proved attractive. Academics still continue to publish on both the Christian Democratic and the Popular Unity governments which preceded the military takeover in 1973. It would seem, in fact, that Chile became especially interesting as a subject of academic inquiry in 1964, when Eduardo Frei was elected as the first Christian Democratic president in Latin America, an interest that became almost a fascination during the Popular Unity years. And indeed, as the number of articles indicates, the attention of academics in Europe and the United States increased further after General