NEOLIBERALISM AND THE WASHINGTON CONSENSUS: THE CASE OF CHILE

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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 Liberalizing trade 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 million GNP/capita 10,750 USD Poverty rate 11.5 %

CHILE: OVERVIEW Natural Resource: Minerals Export-Import Growth 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 Privatization Unilateral + FTAs Diversification of destinations Privatization Stability (low inflation) Foreign investment Poverty 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 .461 Argentina .513 Chile .549 Brazil .570 USA .408

Thus is born a “poster child”…

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