Chile: Neoliberal Paradise for a Few, Capitalist Hell for the Majority

(By La batalla de los trabajadores; translated by Pablo Pérez)

Chile is one of the OECD countries where the actual wage of the workers (i.e. the difference between the received wage and the level of the prices) is the lowest. Although both the prices and per capita income statistics (which are around $1,300 per month) are close to those of a first world country, they hide a terrible reality for the working class.

The Chilean working class lives in neighborhoods with life expectancies and a human development index similar to those of sub-Saharan countries, and has to survive with unstable and badly paid jobs, which also usually lack of contractual regulations and the minimum safety conditions. The huge wage gap existing between an unskilled worker (who usually gets about $400 per month) and the small faction of high-level managers and shareholders is one of the main causes of this paradoxical situation.

According to statistics, if a Chilean owns 4 Porsches and another has none, each Chilean would have two Porsches.

Furthermore, the so-called “differed salary” (unemployment subsidies, health benefits, pensions benefits, etc.) is inadequate because even though it is taken from a portion of the worker’s wage, it hardly benefits the worker: the welfare system is totally privatized and, even worse, the private management of those services usually receives state funding. This ensures the monopolistic control of those services in the private sector (for example, a worker with a labor contract is forced to pay for his/her/their pension to a private Pension Fund Administrator). Thus, the total privatization of the pension system has created a “risk-free business” for the Pension Fund Administrators. This explains why the seven companies that control the market accumulated profits for over $550 millions last year, whereas the average pension received by a worker is about $300.

In addition to this, the health and educational systems are also privatized and thereby subject to the logic of markets: indebtedness is the only way for a worker to get a decent education for his/her children (the average monthly cost of tuition and fees for a college career in Chile is $500). In a similar way, public health survives only thanks to the hard work of a badly paid health staff. The Chilean public health system has a completely abandoned and ill-equipped infrastructure that looks more like the infrastructure of a war-torn country than like that of a country whose ruling class insists in claiming “the Chilean miracle.”

But Chile is a “miracle” built on the basis of extremely long working days, miserable wages, uncontrolled privatizations, and the expropriation of public goods in order to benefit a minority of national and foreign capitalists (for example, last year a law was passed which gives the right to exploit all the ocean resources to 7 big capitalist conglomerates)

The neoliberal paradise was imposed by fire and blood by Pinochet’s dictatorship. During the “transition to democracy”, the political elite maintained the foundations of such a regime through new democratic governments were full of “closed-door” and “inter-elite” agreements and a clear lack of political will to bring about real changes to the sociopolitical regime initiated under the dictatorship.

However, all the forced and elite-driven consensus have started to fade away because of the political irruption of a new generation that lacks fear and has started to propose new ways to overcome all the legacies of the dictatorship

A sign of this is the entirely leftist composition of the Fech (Universidad de Chile students’ federation), one of the main political actors of the current Chilean popular movement, and whose president is Melissa Sepulveda, a member of the socialist-libertarian organization called Frente de Estudiantes Libertarios (FEL, or Libertarian Students Front).

The presence of libertarian comrades in the Universidad de Chile students’ federation has been a highly constructive tool to help strengthen other social actors, like workers, with the development of their own struggles. This rearming of the labor movement can be seen, for example, in the increasing use of the strikes as the main collective means used by the workers to defend their interests, in spite of all the legal mechanisms through which the Chilean ruling class limit the workers’ capacity to organize themselves as a powerful and autonomous actor. During the last months retail workers, bank workers, workers of health services, public employees, among others, have been the main protagonists of this process of working class articulation. A detail follow up of all those labor conflicts can be found in our webpage

Unfortunately, this proliferation of struggles has not had the sufficient coordination mechanisms. They could have reinforced those struggles by increasing their social impact through the establishment of stronger solidarity networks that would in turn broaden the spectrum of demands in order to include other social actors in those mobilizations. The pressure for a united front has only increased given the results of the last year’s elections, which gave the victory to the political coalition called “Nueva Mayoría”. The Nueva Mayoria is the political heir of the “Concertación”, the coalition that ruled during the period of transition to democracy between 1990-2010. In this new political scenario, the Communist Party abandoned its traditional oppositional stance and decided to join the Nueva Mayoría coalition, aiming to take advantage of the increment of popular demands to create tensions “from within” and aspiring to overcome the Nueva Mayoría’s commitment to neoliberalism.

On the other hand, the explicit objective of the libertarians for the current period is to advance towards the creation of higher levels of unity within the left by promoting the establishment of a strong anti-capitalist pole. To do so, the libertarians promote the articulation of all the expressions of the popular movement. Such articulation will be obtained through strengthening direct links between the different spaces of social organization, as well as through support of deeper demands in order to build a unitary program. Based on this, the libertarians aim for the construction of a broad sociopolitical movement able to constitute itself as a serious political alternative, breaking down the dictatorship’s legacies, and opening a new and more favorable scenario for the class struggle in Chile.



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