Project Abstract

Introduction: One Policy for "Two Chiles"

Economists, political scientists, sociologists, historians, and academics of every stripe have made cogent observations about the Manichaean characteristics of contemporary political economy in Latin America. Political economist Javier Santiso, in his 2005 book LATIN AMERICA'S POLITICAL ECONOMY OF THE POSSIBLE: BEYOND 'GOOD REVOLUTIONARIES' AND FREE-MARKETEERS, makes a very convincing argument that the past half-decade in Latin America has indeed been marked by the figurative and literal battles between "good revolutionaries," i.e. socialists, communists, and Marxists of the Che Guevara/Fidel Castro or Salvador Allende persuasion, and free-market fundamentalists typified by the "Chicago boys" in Chile after the 1973 coup. Santiso's general thesis is that the polities of Latin America, exhausted by decades of partisan struggle and disillusioned by the evident failures of utopian ideologies, have now opted instead for democracy and a cautious embrace of market capitalism tempered by progressive social spending and pragmatic reform in a system Santiso terms economic "possibilism."1 If one is to believe Santiso's thesis, in no country in Latin America is this new style of political economy more evident (and arguably successful) than Chile.

Chile is the perfect nation with which to test Santiso's thesis because it has historically been the most highly-polarized and therefore electorally predictable nation in Latin America. Chilean society remains divided on socio-economic and political lines so much so that many have been prompted to note the presence of "two Chiles, one rich, the other poor."2

The purpose of this project is thus twofold; first, to identify the prevalent characteristics of Chile's political economy, from the election of Salvador Allende Gossens (a committed Marxist and scrupulous democrat) in 1970, through the dictatorial reign of General Augusto Pinochet Ugarte from 1973-1989, and finally to the earnest re-emergence of democracy during the Concertación (1989-Present). The second purpose is to attempt to respond to this question I will posit myself: if Chileans have indeed embraced market "possibilism" as Javier Santiso claims, what does this mean for the Left in Chile, which has historically defined itself in opposition to market capitalism? I feel that this question has particular relevance and resonance since the election of Socialist candidates Ricardo Lagos and Michele Bachelet to the presidency in 2000 and 2006, respectively. How have their policies confirmed or rejected Santiso's thesis?

1. Javier Santiso, Latin America's Political Economy of the Possible (MIT Press: Cambridge, 2005).
2. Peter Winn, Victims of the Chilean Miracle (Duke University Press: Durham, 2004) 1.