to come into power.
Chile’s potential in becoming a developed country was stunted by its former dependency on Spain. Since 1826, Chile has been recognized as a country independent from Spain’s rule, however, Chile continued to suffer from the effects of colonialism. Even until the 1970s, Chile relied on the exportation of raw materials for sustainability (Hellinger 2011). Having an economy dependent on the world market is highly susceptible to the success and failure of international markets. For example, during the Frei administration the prices for copper began to decline. The price drop was detrimental to Chile because the economy “depended on copper exports for 80% of its foreign exchange earnings” (Hellinger 2011, 186). During the Spanish colonization, Chile was charged with producing cheap primary goods such as “agricultural products, minerals, and other raw materials” to be exported to Spain (Hellinger 2011, 136). Once Spain transformed the raw materials to finished goods, these products were then sold back to Chile at a higher cost. The cycle had remained intact until the 1970s. “This arrangement bled Latin America of wealth that could have been the basis for development and eventually, industrialization” (Hellinger 2011, 136).
In the 1930s, the economy of Latin America and Chile became crippled by the Great Depression. “The prices for food and raw materials dropped about 50%” (Hellinger 2011, 128). Consumers in foreign markets stop purchasing goods because their wages dropped. Industrialized countries raised tariffs which made it more difficult for Latin American to buy imports (Hellinger 2011, 129). In 1932 Chile’s copper and nitrates only sold for 12 cents for each dollar earned in 1929 (Hellinger 2011, 129). During World War II Chile didn’t fare any better. Foreign countries were investing money in creating wartime goods such as artillery and uniforms, instead of regular goods needed by Latin America (Hellinger 2011, 129).
Because of Latin America’s dependency on foreign countries, Latin American governments wanted to move towards becoming more economically developed by substituting raw materials for domestically produced goods for internal consumption. The goal was to break the economic dependency Latin America had with developed countries. To accomplish the switch, Argentine economist Raúl Prebisch and a team of United Nations’ Economic Commission on Latin America (ECLA) created the import substitution industrialization policy in the 1930s (Hellinger 2011, 128). There were success with the new policy in the beginning, however, the import substitution industrialization would not last. Inflation began to rise and exports started to dwindle (Hellinger 2011, 128). As the economy in Chile suffered, the wedge between the elite and peasant class grew.
There were high levels of inequality among Chile’s social classes. The elites held most of the land and wealth in Chile. Peasants would live on haciendas and work the land owned by the upper class (Hellinger 2011, 137). The wages were low, but they still needed to pay rent or give up half of their crop to their employers (Hellinger 2011, 137). In Andrés Wood’s movie Machuca, the class difference between Gonzalo and Machuca was apparent. Gonzalo lived in a nice house, with luxuries such as a television, and had nice clothes (Wood 2006). Machuca on the other hand lived in a shantytown that only had the necessities for survival (Wood 2006). Machuca was amazed that Gonzalo owned a pair of Adidas while Gonzalo struggled with going to the bathroom in an outhouse (Wood 2006). Education was also highlighted as a major difference between the classes. When Machuca and his friends integrated into St. Patrick’s private school they had difficulty in understanding the work (Wood 2006). Their lack of comprehension showed the difference in the quality of education between the elite class and the poor. With the poor quality of education, there were a lack of opportunity for the peasant class to get ahead and prosper. In the movie, Machuca’s father stated that while Gonzalo will one day work for his father’s company and eventually own the company, Machuca will remain cleaning toilets (Wood 2006).
Tensions between the classes evolved into violent uprising and protests. For example, in Machuca, Gonzalo’s mother and Silvana, Machuca’s cousin, got into a physical altercation during a political march for the elite class (Wood 2006). Each class had a derogatory name for the other, such as, the name “mummy” refers to rich and spoiled people like Gonzalo (Wood 2006). The elites and the poor saw each other as enemies. Each party blamed the other for the lack of development in Chile (Wood 2006). The hostility between classes was portrayed in Machuca, during the parent meeting with Father McEnroe (Wood 2006). The wealthy parents accused the poor children of degrading the school and causing problems. They blamed the kids for starting fights and blamed Father McEnroe for giving them a scholarship to St. Patrick’s (Wood 2006). The resentment the wealthy had against the poor children reflected their attitude about the peasant class. The elites viewed the poor as weights that dragged Chile down, resulting in a lack of development. Machuca’ mother replied to the accusations by saying that the elites always blamed the poor for everything, even circumstances out of their control (Wood 2006). Even though she gave a heartfelt testimony, it was not enough to sway the wealthy (Wood 2006). This scene represents how the grievances each class had barely had an effect on the other. Salvador Allende recognized the need for change in Chile. Allende devised a plan to reestablish order with in Chile.
President Salvador Allende and the Unidad Popular (UP) aimed to establish socialized sectors of the economy. A socialist economy was viewed as the only way to move away from economic dependency. Allende wanted to reduce the power of the wealthy by completing the agrarian reform and expanding state own nonagricultural portions of the economy. The 1967 Agrarian Reform Law had begun under former President Eduardo Frei. The reform was to be used and possibly expanded upon by Unidad Popular. The socialized sectors of the economy was to be split into three parts. The first would be state owned property (APS), the second a mixture between states owned and privately owned property (APM), and the third a solely private owned property (APP). Industries such as transportation, utilities, and communication were to be socialized (Oppenheim 2007).
Even though Allende had good intentions creating a socialized economy, the people thought otherwise. Middle-class business owners felt threatened by the new changes. They thought the Allende administration would take control over their business as well as the elite business owners. Workers were to have more of a say in the administration of these sectors (Oppenheim 2007, 43). But, peasants and lower level workers felt as if the programs were taking too long to have an effect. Some started to take matters into their own hands by taking over factories and forming neighborhood organizations (Hellinger 2011, 188). Some even went as far as to arm themselves (Hellinger 2011, 188). The opposition Allende received was tremendous and despite his efforts the economy continued to worsen with the help of elite resistance (Hellinger 2011, 188).
The wealthy held a strong opposition against Allende and his plan to socialize sectors of the economy. They resorted to sabotage President Allende. Political limitations were placed on Allende (Oppenheim 2007, 38). The Unidad Popular faced obstacles in Congress and in the Judiciary (Oppenheim 2007, 38-39). The elites made up the Congress and Judiciary, leaving Allende and the Unidad Popular with little supporters. Having the elites be a part of the Congress and Judiciary had left little room for President Allende to accomplish his goals. The Unidad Popular had the minority status in Congress, which resulted in the need “to negotiate with opposition political parties in order to pass legislation to further its programs” (Oppenheim 2007, 38). The Judiciary consisted of people appointed by the last government, which did not leave any sympathizers needed for the approval of Unidad Popular’s actions (Oppenheim 2007, 39). President Allende not only faced troubles within the government but he also encountered severe food shortages.
A major problem in Chile was the black market. Many people were hoarding food which contributed to the food shortages Chile was experiencing (Wood 2006). As seen in Machuca, crowds of people were found around stores attempting to get resources (Wood 2006). However, with the inflation problem many people were only able to get a few items for larger sized families (Wood 2006). Also, in Machuca, it showed how the elites had better access to goods. For example, Gonzalo and his father were able to go to the black market in a warehouse and was able to buy food and cigarettes with ease. But, outside the warehouse multiple signs were hanging stating that food, cigarettes and other resources were not available (Wood 2006). This scene is significant because it shows a major reason why the people were against each other and President Allende. The wealthy was able to have access to goods and were able to stock up while the poor had to scramble to receive food (Wood 2006). The shortage of food coupled with the deep philosophical differences pushed the elites to have a coup (Hellinger 2011, 172).
The elite class ended Salvador Allende’s presidency by aiding the United States in a coup (Hellinger 2011, 185).
Chile’s military, specifically the Chilean Air Force, were enlisted to end the Allende Administration. Their desire to see Allende out of the presidency ended with the bombing of the presidential palace, the La Moneda on September 11, 1973, which prompted Allende to commit suicide and resulted in a 17 year dictatorship of General Augusto Pinochet (Hellinger 2011, 171). The resistance of the elites and their aiding of the United States in a military coup, led to the breakdown of democracy in the Chilean government.
As demonstrated in this essay, the democracy in the Chilean government broke down because of the low levels of economic development, which resulted in the inequality between social classes. This inequality led to President Salvador Allende’s attempt to reduce the power of the wealthy and to create socialized sectors of the economy. However, despite his attempts the economy continued to weaken and the resistance among Chile’s elites against Salvador Allende grew. Because of this resistance, the government’s ability to govern became crippled which resulted in a
coup.