NEOLIBERALISM AND THE WASHINGTON CONSENSUS:

THE CASE OF CHILE

TAKEAWAYS FROM VIDEO

Title: “Garden of the Forking Paths”

Setting: Argentina

Themes: Social bases of political conflict and polarization; “old” vs. “new” Argentina

Key figures: Juan and Eva Perón, Carlos Saúl Menem [note successors: Néstor Kirchner and Cristina Fernández de Kirchner]

12. STRATEGIES FOR ECONOMIC DEVELOPMENT

The Liberal Era (1880s-1920s)Import-Substitution Industrialization (1930s-

1970s)The Socialist Alternative (1950s-1980s)Neoliberalism (1980s-present)

Free Trade Countermoves: MERCOSUR and ALBA

Poverty and Inequality

WASHINGTON CONSENSUS

Reducing the role of the state Less regulation Privatization

Liberalizing trade Reduce tariffs, quotas = less protection Expand exports, seek partners

Promoting the private sector Foreign and local production Stimulate market competition

CHILE: BASIC STATS

Population 17.0 millionGNP/capita 10,750 USDPoverty rate 11.5 %

CHILE: OVERVIEW

Natural Resource: Minerals Nitrates Copper Sparse migration

Export-Import Growth Pacific Coast connections Copper as key Political democracy (of sorts)

Democracy and Military Rule Party politics (1940s-70s) Socialism via democracy? Salvador Allende (1970-73) The Pinochet regime (1973-1989)

Neoliberal Politics and Policy Democracy (1990-present) Economic uncertainty + reliance on exports (again)

DEMOCRATIC PRESIDENTS

Center-Left alliance: Concertación, renamed Nueva Mayoría (New Majority) for 2013-14 election

Patricio Aylwin (1990-94)Eduardo Frei (1994-2000)Ricardo Lagos (2000-06)Michelle Bachelet (2006-10, 2014-)

Right: Sebastián Piñera (2010- )

POLICIES IN CHILE

Trade liberalization Unilateral + FTAs Diversification of destinations

PrivatizationStability (low inflation)Foreign investmentPoverty and inequality

EXPORTS

Products: copper, fruits and nuts, fish and seafood, wood (and wine)

Partners (2009): China 16.5 % USA 11.3 Japan 9.1 South Korea 6.5 Brazil 4.6 Mexico 4.1

INEQUALITY

Mexico .461Argentina .513Chile .549Brazil .570

USA .408

Thus is born a “poster child”…