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LATIN AMERICA

Pinochet and colleagues

Initial resistance to Chile's military coup in 1973 was easily overwhelmed. The military took no chances and arrested tens of thousands of Allende supporters and others it labeled subversives, and for the sake of control it put thousands into concentration camps. Some leftist activists were hunted down, and some shot on sight. Many fled abroad, exiling themselves to Western Europe and elsewhere. The leader of the coup, General Augusto Pinochet (seated in the photo on the left) announced that Chile, one of the first countries to have abolished slavery, had now "broken the chains of totalitarian Marxism, the great twentieth century slaver."

Democracy in Chile was curtailed, and Congress was closed. The hunt for subversives continued, and the word "disappear" became a verb -- as in "they disappeared him." Any printed material deemed in opposition to the coup was prohibited. By 1975 the Pinochet regime created a new security apparatus and intensified its effort to keep opposition repressed.

Chile was suffering economically. Unemployment had reached 18.7 percent, and inflation was at a rate of 341 percent per year. From the University of Chicago, Dr. Milton Friedman visited Chile and advised economic shock treatment. A group of Chileans who had studied economics at Chicago University -- known as the Chicago boys -- took charge of Chile's economy. Public spending in Chile was cut by one quarter. To fight inflation, interest rates were tripled, dampening borrowing. Chile experienced recession, as were other nations during the mid-seventies. Unemployment rose to 20 percent. But in 1976 the economy began to recover. There were now fewer state owned businesses, liberal foreign investment laws were decreed, and investments began flowing back into Chile from abroad. Tariffs on imports were reduced, which helped trade. In the countryside, seized lands had been returned to former owners, and mechanized farming was appearing on enlarged landholdings -- largely for export crops. People were selling their small parcels of land and drifting into rural shanty towns while the economy was beginning to boom.

January 1977 was the first month that the Catholic Church in Chile reported no disappearances having taken place. Peace appeared to have been restored. Chile's judiciary remained acquiescent, police surveillance continued, and a ban continued against political parties while the regime sent assassins abroad to eliminate opponents. In Washington D.C., in January 1977, a car bomb killed Orlando Letelier, a former diplomat and a critic of the regime, and it also a U.S. citizen in the car with Letelier: Ronni Moffit.

Up from nothing growth figures appeared as workers in Chile were returning to work. There was talk of an economic miracle and of Chile becoming the world's next South Korea or Taiwan. The number of cars in Chile was to triple between 1975 and 1982. Television sets and radios were beginning to appear in abundance. Exports were rising in goods other than copper, which fell to below half the value of the nation's exports. Chile had those called yuppies (young urban professionals) pursuing affluence, and a new breed of young and tough-minded entrepreneurs.

Chile's poorest forty percent, meanwhile, were losing ground. In 1980 their calorie intake averaged 1,751 per person per day. In 1970 it had been at 2,019 per day.

Then came the Reagan and Thatcher recessions of 1982. Demand for Chile's exports fell. In 1983, unemployment rose to 34.6 percent, and manufacturing had fallen 28 percent. The new recession was worse than the recession of 1975-76, but recovery began again in 1984. Economic activity rose again, while in the coming years real income failed to rise and calorie intake for Chile's bottom forty percent was declining from what it had been in 1980. Privatized companies that had fallen deeply into debt were bailed with money from Chile's taxpayers. Unemployment diminished to respectable levels, but remained high, helping to keep wages down.

Meanwhile a new constitution had been created that guaranteed elections for 1989. Exiles were allowed to return for these elections, and that year, Patricio Aylwin Azocar, leader of a seventeen-member Coalition for Democracy, was elected President. The election ended Pinochet's rule as Chile's head of state, while Pinochet remained as Commander of Chile's armed forces, not to retire until March 1998.

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