Chile is shaped like as a "string bean," 2,600+ miles long with an average width of
100 miles. There are three Chiles—North, Central, and Southern; Central Chile, where Santiago and Valparaíso are locate, dominates.

Be careful of these generalizations, for they can be very misleading. It
is more important to recognize the peacefulness and stability and that Chile had fairly
stable governments in the 1831-1891 period. The country was run by the oligarchy. The Liberals
gained an increased role in the government in the 1850s. Although they were liberal on
some issues, they were oligarchs.

The Parliamentary Republic established in 1891 chiefly changed the
relationship between the executive and legislative branches of government. It did not turn
government over to a new class.

In the 1860s, changes in the Constitution reduced the church's
position in the government, broadened the electorate some, and altered education.
Education thrown more into hands of the liberals.

The 1880s saw a little bit of socialist agitation. Some labor
organizations were created and strikes occurred but the political and social effects of
industrialization were not very noticeable until 1920. The large estates, the fundos were
not destroyed.

President Balmaceda (1886-91) wanted to do something for the poor.
Decided to tax the rich to help the poor. In modern terms it was not much but something.

Rotos started coming into the towns in the 1890s, increasing the
size of towns and cities.

The Radical Party was formed in the 1860s, seemed radical then
because it argued that the middling classes should be allowed to participate in politics
and government.

Leftism in Chile has older roots than in any other Latin American
country.

Most striking thing about Chile in the 19th century was
public order.

Economic development began about 1831. For the early 19th
century, it was the greatest in Latin America. There is some connection between political
stability and government efficiency, on the one hand, and economic development on the
other. People invest money when they can be sure that the rules will remain the same.
Chile was not spending its resources on civil wars as were so many other Latin American
nations. As a result of the effectiveness of government, Chile was able to use its
resources to gain some territory. The Chilean military was better organized. Chile bought
arms abroad and bought warships. In 1880s, when some people in the United States advocated
a bigger navy they pointed out that Chile's was larger.

The Chilean government received enough revenue to expand the
educational system considerably in the late19th century and to improve upper class
technological education.

Expansion towards the south across the Río Bío Bío was blocked by
the Aracanian people for a time. Chile lacked a large number of Amerinds and many of those who
existed inter-bred with Europeans. This miscegenation meant fewer social problems. Many
Chilenos are unaware of their mixed-race heritage, a fact which has meant less ethnic discrimination.

Chilean historians consider the history of education important, that there the nation has a strong educational system.
Normal schools existed all over Latin America, but Chile enjoyed a relatively strong intellectual
life. Approximately 500 public schools were established in the 1850s, meaning that something
was being done. As public education increased, the education question got mixed up with the Church because the latter
considered secular schools to be sinful. Many Christians would prefer no schools to government-run schools. In Chile, they lost.

The Chilean Roman Catholic church had relatively good personnel and
was adequately staffed, making it an exception in the region.

In 1879, the national university was reorganized French lines, which was an
improvement because the curriculum became more modern. The French were world leaders in education.

The economy was reasonably simple. Up until 1880, copper was usually
the leading export. Then nitrates became the leader until chemical fertilizers reduced
demand. Copper exports grew with the demand for copper in industry around the world. Chile
was characterized by a great estate system. The fundistas (or hacendados) ran the country
under a system designed by Diego Portales. Portales had convinced them to quit fighting
each other and unite against their common enemy: everyone else. In the last third of the
19th century, this system was being challenged mildly by the rise of industrial
classes. In 1883, the National Association of Chilean Manufacturers pushed for protective
tariffs. Its success was small but that the fact that the organization existed and was
able to lobby Congress meant that there were enough manufacturers to have some hope of
success. William Wheelwright in the 1830s brought United States technology to Chile. For
part of the 19th century, the nation was able to export wheat but became an importer in
the 20th century. Coal mining expanded in the 1840s.

1810-1831

1810-1814. The period began in September of with the establishment of a national junta
and end with the victory of the viceregal forces. Known as the patria vieja. In 1811,
adopted free trade. A national congress was convened. On September 11th Jose Miguel
Carrerra (who was under 26 years of age) took control of Congress. Regionalism was a
problem, especially in Concepción

1814-1817. Period of royal authority until the patriot invasion in 1817 when San
Martin's Army of the Andes crossed the Andes. The Chilean forces were defeated at Rancagua
by a Peruvian royalist army.

1817-1823. The period began with the Army entrance and election of O'Higgins to the
Supreme Directorship in 1817. Ends with O'Higgins resignation in early 1823. Independence
declared; provisional constitution created; attacked Church including imprisoning friars
and exiling bishop of Santiago; attacked privileges of the rich, particularly mayorazgo;
centralization at expense of provinces. These leaders were Freemasons from the "logia
lautarina."

1818. O'Higgins decreed the end of mayorazgos, but Senate, in 1819, reversed his decree
"for now."

1819. Senate ordered O'Higgins to speed up the departure of San Martin's liberating
expedition to Peru.

1820. O'Higgins authorized to send army to Concepción to stamp out royalism

1822. O'Higgins tried to dissolve the senate (5 persons) of whom two were out of
country and third interested in returning to private life. Senate balked.

The Constitution of 1822 created a strong central government with
strong executive. O'Higgins policy was the suppression of banditry; creating public
library; beautification, anti-gambling, and suppression of titles of nobility. He tried to
abolish primogeniture (mayorazco) but provoked anger. In 1822, there was a revolt in
Concepción. By 1823, there was revolt in the North as well. By beginning of year, armies
marching on Santiago. Revolt in Santiago and O'Higgins resigns.

1823-1829. Fall of O'Higgins to the victory of the pelucón (big wig) coalition. The
provincial rebellion which started in the south forced O'Higgins to resign in January
1823. He was replaced by Ramón Freire, rebel leader. Lots of government changes.

Chile had 500,000 to 800,000 people but only thousands of whom were active citizenry.
The active citizens were a mixed merchant-mining-agrarian bourgeoisie. They were
pluralistic within the confines of classic liberalism.

Constitution of 1823 was drawn up by General Freire in place of the Santiago one.
Lasted six months and then Freire pulled coup and named himself dictator. Continued
upheaval. Civil war between Liberals and Conservatives, which latter won.

Portales Era

Diego Portales was born the son of superintendent of royal mint at
Santiago. He went to Peru in 1821 to conduct the foreign part of his newly formed merchant
business and stayed there until 1823. In a letter he wrote from Peru, he gave his view of
politics: "A strong government, centralizing, whose men are true models of virtue and
patriotism, and set the citizens on the road of order and virtues. When they have made
themselves moral, the government comes to be completely liberal, free and full of ideals,
where all citizens take part."

In 1824, Portales, CEA y Cía signed contract with government for
tobacco monopoly. The company was to service the external debt. estanco contract.
It was a bad deal because of its unpopularity and the inability to stop illegal sales and
growing of tobacco. Lacked sufficient capital. By February, 1825, it had become a
political issue as pipiolos wanted to end the monopoly. The supporters, estanqueros,
supported it. In 1826, however, a commission was created to carry out the liquidation of
the contract. In 1828, the commission ruled that the government owed Portales 87,000 pesos.
The estanqueros became a central force of the broader pelucones coalition.

Portales bought a press in Valparaíso, and used his newspaper to
defend his monopoly, the estanco. He had been drawn into the public arena.

In 1829, a major revolt began as result of national elections. The
pelucones got control of government. A Congress of Plenipotentiaries met in Santiago in
February 1829 and elected government officials. By April, Portales was the minister of
interior (government) and minister of war. The years following the O'Higgins period were
very difficult because there were small armies all over the country. Portales convinced
the big landowners that these armies had to be put down, that they were a threat to life
and property. He had them create a militia, the Civic Guard, to restore order. He created
a coalition of landowners, the Church, and the military. They not only agreed not to fight
each other but agreed that the outgoing president could name his successor. Portales'
Constitution of 1833 would last until 1924 with some changes. The President was selected
by electors like the president of the United States but by only a few people. The Church
retained many privileges. From April 6, 1830 to August 31, 1831, Portales was virtual
dictator. He created a stable, professional civilian government. It was non personalistic
and non paternalistic. He dismissed leading generals because they engaged in politics. He
created military academy and a civic guard. He brought the Church back into the government
and restored its privileges.

His minister of treasury (1830-1835) reduced the size of the army
and the government bureaucracy. In early 1831, Portales decided to return to private
business, but congress elected him Vice President. He refused and resigned all his other
posts. Congress would not accept his resignations and Portales kept them until they were
abolished in the 1833 constitution. He was also minister of war and marine but someone
else ran the ministry.

The 1833 Constitution reflected his views. It contained three
branches with a bicameral legislature. 1830-1837.President elected 5-year term by males
over 25 and married men over 21, provided they were literate and owned property. Meant
only a few thousand could vote. The president was eligible for two five-year terms and was
given extensive power. Through legal and extralegal means, he was able to control
presidential elections. The Senate was selected by indirect election for a term of six
years; Chamber was elected directly for a term of three years. Congress was to be an equal
partner but was not. The document specified high voting requirements. Voters also had to
have property and income. The constitution invoked literacy requirements to take effect in
1840. The Church was granted special privileges (fueros) but not the army. Portales and
his associates had learned the dangers inherent in having a military. The constitution
abolished provincial assemblies. It reinstated mayorazgos. This was to be a government of
the rich and well-born. Catholicism was official religion. Primogeniture reintroduced.

By mid-1835, the pelucón coalition was on the verge of breaking apart. The President
Joaquín Prieto pleaded with Portales to return to the government and save it. Portales
became minister of interior, foreign relations, war and marine. In essence, he was a
dictator. He started a war against the Peru-Bolivian Confederation, which lasted from the
end of 1836 until 1839. Chile won. Portales, however, was assassinated in June 1837 while
reviewing troops.

William Wheelwright came in 1840. He reated a steamship service
between Chile and Peru and Chile and Europe. In 1851, he started construction of a railroad
and laid plans for trans-Andean railroad.

1840-1860. National revenue doubled. Population up 80%, partly due to immigration.

1842 The University of Chile was founded.

1861 A small civil war.

Liberal Dominance, 1861-1891

Jose Joaquin Perez (1861-1871. A moderate Liberal, but not very liberal. War with Spain
(1865-661 when Spain attacked Peru. Chile fought a war with the Araucanian Indians

Federico Errázuriz Echaurrén (1871-1876). The constitution had been amended to allow
only one term. He spent money on public works, thus providing employment for the working
class. Church-State conflict which was a partial victory for Liberals. In 1874, the
Constitution was amended to make ministers more responsible to Congress.

Anibal Pinto (1876-1881)

War of the Pacific ( 1879-83) over control of the nitrate mines. Chile got Tarapacá
from Peru and Antofagasta from Bolivia.

Domingo Santa Maria (1881-1861)

Church power reduced.

Jose Manuel Balmaceda (1886-91)

During his administration there was lots of spending on public works and infrastructure. Tariffs were lowered. The school system expanded including the
creation of a women's secondary school. Balmaceda was overthrown in the revolution of 1891.

The growth of newspapers is evidence of the changes in Chile. There were more and more of them
reflecting the increases in the literate population and increased wealth. In 1872, they
were given almost complete liberty, a sign of liberal strength.

The government continued to use the state of siege provision of the constitution which
allowed it to suspend the parts of the constitution.

The Civil War of 1891

President Balmaceda was rich; an excellent speaker; elected by a
large vote; and sympathetic to the poor, the bulk of Chile's population. He was also
inflexible and arrogant. He and his party lost power and influence after his election in
1886.

It is important to understand that oligarchic control was not
destroyed and military rule was not forced on the country. The civil war was one part of
the oligarchy displacing another part by force. Congress revolted again Balmaceda because
he was acting unconstitutionally. Power had been shifting from the Presidency to Congress
for some years. The Balmaceda faction only held 25% of the seats in Congress. He had
thirteen ministries because of Congressional opposition. In 1891, he decided to impose his
own presidential candidate on the country and the opposition. Congress would not accept this,
passing a law prohibiting this practice. Balmaceda refused to sign the bill. In 1890,
Congress refused to approve the budget for 1891. Balmaceda decreed that the old budget
would continue, an illegal act.

Opposition to Balmaceda was centered in Congress. They were rich and
influential. They saw themselves as the establishment and Balmaceda as a maverick. They
began talking conspiracy. In November 1890, they approached General Baquedano, the hero of
the War of the Pacific, to lead the coup attempt. When he declined and declared himself
neutral, they recruited a navy captain, Jorge Montt. At the end of December, 1890, he
agreed to take part if Balmaceda carried through with his threat to spend an illegal
budget.

All the chiefs of the navy supported the insurgents as did most of
the officer corps. The army supported Balmaceda. The navy was more aristocratic, which is
typical of navies. From the beginning, Balmaceda worried about the loyalty of army. He had
them swear an oath of allegiance. Some refused and their commands were shifted. Some
escaped and joined the opposition. Some appealed to the Supreme Court. The
Constitutionalists, as the opposition called itself, expected the bulk of the army to join
them but it did not. The Constitutionalists went to the Atacama desert, far away from the
much more heavily populated Central Valley because they would be beaten if they stayed
near the army. Balmaceda's army could not follow them because it had no ships to transport
them. The Atacama Desert is one of the driest deserts in the world and people avoided
traversing it on foot.

By going to the Atacama, the Constitutionalists acquired time and
money to build their forces. They gained control of the nitrate and guano deposit, thus
gaining sources of income. They had numerous officers but had to recruit foot soldiers.
They hired Colonel Körner, a German officer, to train the army. They bought arms abroad.
Balmaceda bought ships abroad.

The Balmaceda failed to make the right counter moves before the revolt
broke out. He tried to send the navy out to sea. The Constitutionalists had pipelines into
government and knew the government's plans. They seized enough Chilean merchant ships plus
their own vessels to take 10,000 men to the desert in the north. Balmaceda had army
support of 32,000 men. In part, this loyalty was a result of his public works programs
which had employed many relatives and friends of army personnel. He also had financial
support.

Nevertheless, the insurgents won the Battles of Placilla and
Concón. The loyalist troops ran. Resistance collapsed in Santiago, resulting in rioting
and looting when the police left. Upper class citizens armed themselves and restored
order. The Constitutionalists purged the army and put a puppet president into office.

The Parliamentary Republic was one of Congressional control and
ministerial irresponsibility. The president became a ceremonial figurehead. There was a
multiplicity of parties whereas there had been liberals, conservatives, Nationalists and
radicals (the first three often cooperated under the Liberal banner), now there were many
more. Governments therefore became coalitions. Congress was dominated by the landed
elites. Politics flowed upward from the local bosses in the provinces through the
congressional and executive branches; payoffs from taxes on nitrate sales flowed downward.
Congressmen often used bribes to win elections. Peasants were intimidated to vote as the
landlord wished. There were 121 cabinets with 530 ministers in the Parliamentary Republic.
Money was wasted by this system. Still, it did allow dissent and new parties, like the
Radical Party, to come into existence.

The 1920 presidential election would prove to be a turning point.
The expansion of mining in the north and in the south around Concepción was changing the
nature of the electorate. The landowners failed to accommodate to these people or to
attention to the increasing number of city dwellers. Developments were gradual
and took place in the spirit of a respect for civil liberties. There was the continued
development of urban and commercial interests. Protective policy gave stability to
agriculture and a national manufacturing base. Chile's economy continued to be
characterized by constant growth. Prosperity was evident and there was social
restructuring of society at all levels. The aristocracy was transformed into a plutocracy
as the commercial and industrial bourgeoisie swelled its ranks. With this, one saw a
decline of a paternalistic attitude and development of a more utilitarian attitude.

There was the rise of middle class, in Chile often called an
empleado [employee] class. Note the distinction, for it meant the proletarization of the
middle class. There was a large intellectual proletariat through the state education system..
They were educated but could not penetrate the aristocracy or plutocracy. They became
increasingly aware of their role in Chile and were the backbone of the 1920 electoral
revolt.

The rich mineral regions of the north and coal mines of the south
gave rise to an industrial proletariat. By 1907, it was one million people. The living and
working conditions were deplorable. For rural workers (inquilinos or tenant farmers) and
the migrant workers the situation had. worsened rather then improved as paternalism
declined.

The proletariat was strongest in Valparaíso, Santiago, Tarapacá,
Antofagasta, and Concepción. Its efforts to be granted recognition was fraught with peril. In the 1907 Iquique strike, 2,000 workers were massacred.
Between 1911 and 1920, there were 293 strikes involving 150,000 workers. Chile saw the
rise of trade unions and the beginning of mutualist associations.

In politcs, blocs were fromed in the hopes of producing majorities. The Right consisted of the
Conservative, Liberal, National and Liberal-Democrats parties. The Radical Party had the
broadest base, for it represented the interests of the southern region but drew from all
middle class. It was not much interested in workers .

1920 Election

The downfall of the system can be chiefly attributed to the revolt
of the middle classes supported by the new proletariat, the less of its political prestige
by the traditional oligarchy, administrative chaos, a government on the brink of
bankruptcy, and the scandal of parliamentary majorities created by bribery and corruption.
Additional factors were the collapse of the nitrate boom in 1910 and the influence of the
Mexican and Russian revolutions.

Arturo Alessandri led a coalition, the Liberal Alliance, to victory. The basis of the coalition was the Radical Party and Democrats with additional support
from a Liberal Party faction. Beat the conservative National Union coalition. Alessandri
won by a narrow margin.

In his first message to Congress, Alessandri called for
administrative decentralization, abolition of the Parliamentary, election of the president
by direct popular votes, the separation of Church and State, state control of banks and
insurance companies, monetary stability, and social security. He was faced with strong
opposition in the Senate and he could not go far down the road to reform. Also had to face
reform and economic recovery at the same time. The 1924 congressional elections gave him
control of both houses but Congress refused to pass his laws.

Events came to a head to head when Congress voted itself pay
increases in violation of the Constitution. The army intervened in politics for the first
time in about a century, overthrowing the government. Alessandri left the country; a junta
was established; and Congress was dissolved. The junta lasted five months until a radical
group of young army officers, led by Marmaduke Grove and Carlos Ibañez, took control.
With army support and free from political obstructionism, Alessandri returned to implement
his program. He introduced social-economic reforms designed to protect the laboring
classes, a graduated income tax, and a permanent voter register. The Constitution of 1925
was passed.

It strengthened the presidential office. The President got a
six-year term and was elected by direct vote. If no candidate had a majority, Congress
selected the president. For Congress, it created a system of proportional representation.
The dates for presidential and congressional elections was separated. It declared that
property had a social function.

Confusion, 1925-1932

Alessandri was no friend of labor, for he used troops against
strikers and some workers were killed; he also could not force out Minister of War, Colonel
Carlos Ibañez, who had presidential ambitions. Alessandri resigned again and left for
Italy. Louis Borgoño took the presidency temporarily until the political parties selected
Emilio Figueroa Larraín to take his place in December, 1925. Ibañez continued as war
minister and added the vice presidency and the minister of government to his portfolio.
Clearly, he was the dominant figure in the government. Ibañez forced Larraín out in
February, 1927, and established a dictatorship, ruling until 1931. He began reforming public
administration, instituted numerous public works programs, and increased state
interventionism in the economy. Foreign capital came to Chile in great amounts because he
provided stability. However, political arbitrariness and repression increased as well with
the jailing or banishing of political leaders.

By 1930, the sharp economic depression was being felt. It was worse
in Chile than almost anywhere else in the world. The Ibañez regime collapsed in 1931 and
was followed by a period of political unrest. There were failures of nine different
governments, two general strikes, and a naval revolt, all within fifteen months. One
president was in office for only five months before he was overthrown by Marmaduke Grove,
who declared a socialist republic. He only lasted from December, 1931 to September, 1932.
He proposed to nationalize the coal, copper, and nitrate mining industries and encouraged
unionization. The socialist republic was ended by another coup and the government was
turned over to the Supreme Court. New elections were called.

As might be expected, the political parties were split and
disoriented. The Conservative party was in the best shape because it members, landowners,
had never been threatened. No one was going to tax land or redistribute it or force
landowners be more productive. The Radical Party was split into right and left factions.
The party had taken the side of the proletariat but it was not certain how pro-labor it
was. The Communist Party split into Stalinist and Trotskyite wings and the Trotskyites
merged with the Socialist Party. The Socialist Party of Chile was formed on April 19, 1933
and stood for the collectivization of private property, the temporary dictatorship of the
proletariat, and the economic and political unity of all Latin American countries. It was
a Marxist party which was a bitter rival of the Communist Party.

Arturo Alessandri, 1932-1938

On the presidential election of 1932 there were five candidates. Two were rightists.
One form the Communist Party candidates and one from the Socialist Party. The victor was
the fifth, Arturo Alessandri, who represented the middle sectors. The "Lion of
Tarapacá," as he was known, had become more conservative. He sided with property
owners and the upper classes. He was severely criticized by the Left. National finances
did make a recovery as did employment. Bankruptcies practically ceased. The depression was
virtually over by 1934. He furthered economic nationalism. When labor began causing
trouble in 1936, he persecuted labor leaders, dismissed Congress, proclaimed a state of
siege, and gave the army control of the railroads. He crushed the Nazi movement; Chile was
one of the few places in Latin America with a significant Nazi movement. More typical was
the rise of Catholic activism, the Falange Nacional and the Social Christian movement.

The Popular Front, 1938-1941

The Center and Left rallied together for the 1938 elections as a
Popular Front. It was done in Europe, in France and Spain, but Chile was the only place in
Latin America. Chile had a leftist tradition but part of the reason was the Alessandri
regime. He used severe repressive measures and had dissolved Congress because of
anti-Leftism. The Radicals, Communists, Democrats, Socialists, Radical Socialists, and the
new Chilean Labor Federation united. They did well in the 1937 congressional elections.
The rightists preserved their congressional position only by vote bribery.

Pedro Aguirre Cerda, a Radical, was chosen as the coalition
candidate and won by only a few thousand votes. Both houses of Congress went to the Right.
Clearly, the Popular Front was not likely to accomplish much with Congress opposed to the
president. Equally important, the Popular Front was very fragile and unlikely to stay
united. It did manage to create CORFO, the state development agency, in 1939, but the
Radicals never trusted the Communists.

Coalition politics (1941-1958)

The Socialists withdrew from Popular Front in 1940. They were
fighting with the Communists. In the 1941 congressional elections, the Radical Party got
21 percent, the Socialists and their allies, 20 percent, and Communist Party 12 percent.
The Communists had only gotten 4 percent in 1937, so the other parties were afraid that
they were going to become a major political force. That was the major reason the Popular
front was dissolved in 1941 shortly after President Aguirre resigned because of poor
health. The Radicals and Communists benefitted from the Front; the Communists were able to
penetrate the labor movement and the Radicals elected the next two presidents. .

In the 1942 election to replace Aguirre, Juan Antonio Ríos, a
Radical, was elected with the support of the Radicals, leftists, the Falange, and others.
He defeated Carlos Ibañez, who was supported by the Liberal, Conservative, and Nazi
Parties. Ríos got 56% of the vote but less than half a million people voted.

Ríos was a nationalist, pro-industry, anti-communist centrist who
accomplished little because of WWII and splits within Chile. Chile did enter the war on
the Allied side in 1943, yielding to pressure from the United States. The Socialists split
and Salvador Allende emerged as the leader of the majority faction which controlled the
socialist labor unions. Ríos died in 1946.

Gabriel González Videla, the candidate of the Radicals, Communists,
and other Center-Left parties, won without a majority. The Communists were rewarded with
three seats in the Cabinet but González Videla fired the within five months for pursuing
their own, not the administration's, goals. A Radical his cabinet also included three
Radicals and three Liberals. In the municipal elections of 1947, considerable gains were
made by the Conservatives, Socialists, and Communists. The only gains made by a member of
the government coalition was made by the Communists. González Videla found a Communist
plot to sabotage the economy and hurt US-Chilean relations. The Communists launched a
campaign trying to discredit her administration while conservatives launched an
anti-Communist campaign. The United States, now deeply involved in its Cold War politics,
which included trying to get a united front in the Americas, encouraged Chile to outlaw
the Communist Party. González Videla broke with the Communists and dismissed their
members of his cabinet. In 1948, the Chilean congress passed the Law in Defense of
Democracy, causing the Communists to lose everything but their congressional seats.

Carlos Ibañez won the 1952 presidential election with 446,412
votes. The runner-up was Matte Larraín with 265,357 votes. He got support from many
different groups, including rural workers and tenant farmers who were defying the land
owners. He received Communist support when promised repeal of Law in Defense of Democracy.
Many people supported him because they were disillusioned with the political parties.
Salvador Allende, who eventually would become president, also ran.

In all these years, no basic restructuring of society was attempted.
The great estates (fundos) were never attacked. The issues important to working people
were never addressed. The best the Center-Left had been able to do was the was creation of
CORFO .

Ibañez in power this time was not the dictator he had been earlier.
He followed centrist policies. When prices rose an average 50% a year and wages and
salaries lagged behind, he could not solve the problem. He could repress against labor
unions. Agriculture did not grow and Chile had to rely more and more on food imports.

In the 1958 elections, the Left went into an Alliance known as the
Frente de Acción Popular (FRAP) composed of the two major factions of the Socialists, the
Labor party, the Democrats of the People, and the Communists. Making its first appearance
in a presidential election, the Chilean Christian Democratic Party ran Eduardo Frei. The
party had the Falange Nacional as its base. The Conservatives and Liberals ran Jorge
Alessandri, son the Arturo. Alessandri beat Allende but only by 33,500 votes. If Antonio
Zamorano, a defrocked leftist priest, had not gotten 41,304 votes, Allende would have won
by 8,000 votes and Chile would have had its first Marxist president.

During the Alessandri administration, the Chilean economy showed
little improvement but popular demands were increasing. The administration relied upon
import restrictions, wage ceilings, and currency and currency controls (all of which were
unpopular) and only partially successful. The problem was that the administration was
oriented towards the past and not willing to find permanent solutions to Chile's
fundamental problems.

1964 elections

Christian Democrats ran Eduardo Frei who received 56% of the vote,
the first time in decades that any candidate had won a majority. Salvador Allende of FRAP,
won 39%. The Frente Democrático (Radical, Liberal, and Conservatives were going to run
Julio Duran but it got beaten badly in the 1961 election. Duran withdrew. So the Right
threw its support to Frei. won because of women voting and the fear of Allende. There is
some evidence that the United States government helped the Frei campaign.

Frei's presidency, in spite of his enormous victory and the tacit
support of the United States, would not be easy. Chilean political parties had strong
disagreements this profile shows.

On the right were the Conservative Party and the Liberal Party. The
former was the United Conservative Party. It is the oldest and the first ruling party.
Traditionally it has been the party of the wealthy landed aristocracy. It has been opposed
to any kind of socio-economic liberalism; its traditional strength has been in the land
system. It said that its fundamental doctrine conforms to the teachings of the Church. It
advocated the reestablishment of the parliamentary system, Church's rights, and free
enterprise. In the 1970s, it drew its membership core from wealthy landowners and also
modern business. Its leadership was upper class.

The Liberal Party had its origins in the 1840's. It advocated the
separation of church and state, extension of civil liberties and suffrage, and limitation
of executive authority. Ideological differences with Conservatives almost nil. Membership
from upper strata of business, industry, and professions. In the 1960s and 1970s, it
contained some middle class and working class elements but it was chiefly the party of the
wealthy industrialist and financier.

In the center were the Radical Party and the Christian Democratic
Party. From 1932 to 1964, the Radical Party had greater voting strength than either party
of Right. Originally its basic principles were: universal suffrage; freedom of the press;
freedom of association, equality before the law, and obligatory, free and secular
education. By the first part of the twentieth century, it had evolved a collectivist
orientation to meet the demands of social justice. In 1930s, it cooperated with leftist
parties in seeking reforms. During the 1940's it lost much of its reformist zeal and moved
rightwards towards center. Ideologically, it is split. The left wing advocates. wide
social reform, even socialism, while the right wing identifies with programs of the Right.
Has been led by the middle classes of Chile's provinces. Anticlericalism one of its main
platforms. Also drew from upper-class landowners in the South who wanted clerical reform
and resented Santiago's power. Interested in improving conditions of the lower classes by
evolutionary not revolutionary means.

The Christian Democratic Party. was the left-wing of the Center. It
began in 1938 as the Falange Nacional, an offshoot of the Conservative party. Young
Catholic intellectuals such as Eduardo Frei, Radomiro Tomic , Manuel Garretón, and
Bernardo Leighton led it. In 1957, joined with Eduardo Cruz-Coke's Partido Conservador
Social Cristiano to form the Partido Democráta Cristiano. Intellectuals, technicians, and
women are its core membership. It believed in social pluralism and political democracy.
Neo-socialistic economic platform. Most saw themselves as leftists and Catholics. Want
communitarian society to avoid pitfalls of Marxism and evils of capitalism. Supported
abolition of all private property except consumer goods. "Revolution with
freedom" was a motto. Drew heavily from the middle class.

On the left were the Communist Party, the Socialist Party, and the
Movimiento de Acción Popular Unida after 1968. The Communist Party is the oldest,
strongest Communist party in Latin America. It had occupied a key position in the labor movement
for forty years and more. Founded in 1912 by Luis Emilio Recabarren as the Workers'
Socialist Party, it joined the Comintern in 1921. It split into Stalinist-Trotskyite wings in
the 192Os. The Trotskyites later merged with the Socialists. Its tactics were gradualist, peaceful road to
power, a strong appeal in labor and intellectual circles, and representation of itself as
just another political party. It was Marxist-Leninist with close ties with the Soviets.

The Socialist Party has its roots in the Sociedad de la Igualidad,
founded in 1850. It did not become genuinely socialist until 1900 or thereabouts. In April,
1933, the Socialist Party of Chile founded as coalition of other groups. It split in Popular
Front days. A group opposed to the government formed the Workers' Socialist Party. Another
split in 1942 into the Authentic Socialist Party, which split in 1948. By then, there were two major factions: the
Socialist Party of Chile and the Popular Socialist Party. The SPCH agreed with the Defense of
Democracy Law. Socialist Party of Chile is the party of Salvador Allende. Its ideology was
nationalistic, Marxist, revolutionary, anti-capitalist, anti-imperialist, class-based, and
"americanist". It believed in Marxist dialectics and historical materialism. It was interested in
Chilean socialism, workers' democratic government, and centralized planning. It called for worker
ownership of means of production and distribution, worker in this instance included
white-collar personnel. It called for the nationalization of basic resources and use of
cooperatives and state farms. Workers and intellectuals formed the core of party.

The Movimiento de Accion Popular Unida was comprised of the
left-wing of Christian Democrats who left the PDC in 1968. It was part of Popular Unity coalition
of 1970. It resembled the Socialists in their outlook. Radical Catholics led by Jacques
Choncol. It believed that revolutionary means were necessary to achieve social justice in
Chile and agreed to the use of violence and terrorism as tactics.

Chile Under Frei, 1964-1970

The Christian Democrats had campaigned on the slogan
"Revolution in Liberty, " calling for reform, not revolution. They called for
agrarian reform (the redistribution of unused land); more public housing; Chileanization
of copper; and more popular participation in politics and the economy. The problems facing
the new government were daunting.

Minerals, particularly nitrate and copper, furnished close to 80% of Chile's exports. Iron and manganese are also important.
Nitrates accounted for 74% of the value of nonmetallic minerals. Chile has 30% of world's
copper reserves and Chile contributed 25% of world's production. The Anaconda Copper
Company of the US has owned the Chuquicamata and El Salvador mines and derived two-thirds
of its world production from these. Braden, a subsidiary of Kennecott Copper, owned El
Teniente These three turned out 85% of Chile's production. Frei began Chileanization of
these mines, buying out a majority share. Iron ore goes to Huachipato steel mill near
Concepción. There is oil in the Straits of Magellan area. Chile is poor in coal, but
partly because it was having difficulty in exploiting coal in Magallanes area. Forests
cover 22% of Chile.

Chile had hear 8.7 million people in 1970 and enough arable land to
sustain this population. Thirty per cent of the economically active population depended upon
land for its livelihood, but there was high inequality in land ownership. Agriculture failed
to fulfill its role in economy; it only contributed 12% to GNP. There was stagnation of
agriculture and livestock. Productivity per worker was the lowest in the economy and had
declined 20% from 1952 to 1962. The lack of incentives for the worker, low technological
levels, and under-utilization of labor in some small holdings all contributed to low yields
The large estate or fundo was still the prevailing landholding system in Chile. Also, large
properties were concentrated in central Chile near Santiago-Valparaíso and small
properties were concentrated in the South. In the central valley, they grew fruits, wines, and
truck garden products, which permit intense cultivation with high productivity per land
unit while in the South wheat, rye, and other cereals were grown, crops which require extensive
acreage for greater productivity. Chile needed to reverse this pattern to get higher yields.
Large landholdings made up 62.8% of all farm land but only 1.4% of all holdings.
Thirty-seven per cent of the farm units, containing less than five hectares each (approximately
2.5 acres=hectare) occupied only 0.3% of the agricultural area. In central Chile, land
concentration was even higher. Only Christian Democrats and FRAP had consistently spoken
to land problem or tried to do anything about it. One approach had been opening new lands
and using colonization. In the 1960s, population had increased 1.8% and food production
1.6% annually. Agriculture employed 27% of labor force but contributed only 12% of GNP
(1960). Chile had to import food.

Migrant workers (afuerinos) received the lowest pay in the country, the equivalent of
US 30-40 cents daily in cash and benefits. Inquilinos (tenant farmers) earned about 60
cents daily. The 1954 per capita income in Chile was US $150 while for the US was $1,845.
This is useful for comparative purposes, although prices varied between the countries. Chilean farm
labor received only 11% of national income.

Inflation had been a serious problem. In the 1952-1957 period, the
price of rice rose from 22 to 78 pesos a kilogram, sugar from 8 to 85 pesos, meat from 50
to 500 pesos, and an ordinary man's suit from 3,000 to 21,000 pesos. An unskilled worker
in 1957 earned 15,000 pesos monthly which equaled about $24 at that year's exchange rate.
A white collar employee averaged 50,000 pesos. Prices rose only 17% in 1957 but over 30%
in 1958. In 1962, the cost of living increased 28% and in 1963 increased 45%.

Frei began tackling these problems. In 1965, Congress agreed to Chileanization, the government
buying into the copper companies with the companies to
increase production. Most Chilenos, even conservatives, supported the country gaining more
control, if not ownership, of the copper companies. It was a matter of nationalism. So the
government bought some ownership but production did not increase enough. In 1967, land reform measures
were passed but they were modest. Rural wages did go up, partly at Frei's prodding, but not
enough to make a substantial difference. Inflation was reduced to about 20% a year, lower
than before but still too high. More money was put into social welfare. Frei borrowed huge
sums from United States citizens and its government, seeing these loans as an investment
but willing a very large debt to his predecessor.

The Christian Democrats had promised too much. People thought their
lives would change immediately. The Movimiento de Acción Popular Unida broke from the
party ranks. Conservatives were upset with his reform measures, for they had not wanted
any change. The left, led by Salvador Allende, argued that only a true socialist
revolution by peaceful means could effect the changes needed and that what was happening
under the Christian Democrats was to be expected. Even the mainstream Christian Democratic
Party showed some displeasure with Frei when it nominated Radomiro Tomic from its left wing
to be the presidential candidate in 1970.

Leftist forces clearly won a majority in the 1970 presidential
election. Salvador Allende, running with the Unidad Popular (UP or Popular Unity)
coalition, won the plurality with 36.3% of the vote, not a majority, but Radomiro Tomic
won 27.8% and his platform was not very different from Allende's. The conservative Jorge
Alessandri won 34.9%. Congress would do what it had done before, select the front runner
in November. Opposition to Allende was so strong, however, that General René Schneider was
killed in September while preventing a conservative coup. Fearing Allende, people began
putting their money in overseas banks. Rumors abounded that the Central Intelligence
Agency of the United States would somehow prevent Allende from taking office or that the
military would intervene. Until the November election by Congress, intense lobbying took
place by the pro-Allende and the pro-Alessandri forces. The Christian Democrats got
Allende to sign an agreement to respect the constitution and then voted for him.

Allende froze prices and raised wages in an effort to improve the
condition of the common man. He gambled that increased buying would increase production
(production was substantially below capacity) and everyone would benefit without inflation
occurring. Further, he used the profits from copper sales under Frei to subsidize his efforts. It
worked for about a year. The final nationalization of the copper mines was done by a
unanimous vote of Congress in July, 1971, when Congress passed a constitutional amendment
to nationalize the copper mines. The Allende government later refused to compensate the
companies fully claiming that they had made excess profits; they deserved a pittance.
Following the nationalization of copper was the nationalization of coal, steel and other businesses. The
administration expropriated the International Telephone and Telegraph Company after it
interfered in Chilean politics in September and tried to bribe the United States
government to overthrow Allende. The government went after other multinational
corporations, such as the Ford Motor Company, when they did not cooperate. Allende stayed
within the law.

In October, Congress passed a constitutional amendment to limit
"intervention" and "requisition" and to stipulate that Congress must
approve expropriations. This was the Area of Three Properties Law (e.g. what public, what
private, what mixed). In November, the administration declared a moratorium on the payment
of foreign debts. In December the Housewives March of the Empty Pots, partly
funded by the CIA, occurred. Women marched throgh Santiago's streets banging pot in protest.
Chile did a partial devaluation of its currency. But at year's end,
industrial growth had grown 8.3% and agriculture 5.3%. The money supply had increased
120%. The balance of payments deficit was $315 million, not that unusual, but still a
problem.

Allende was unable to prevent the radicalization in the countryside or in business firms because members of his coalition acted without his approval. He had
managed to radicalize events but could not control them..

The Nixon administration was determined to drive him out of power.
It got financial organizations to cut credit to Chile although some European countries
refused. The CIA gave substantial amounts of money to Allende's opposition and talked to
military leaders about deposing him.

In June, 1972, Allende formed a new Cabinet because economic policy
creating political problems. The cost of living jumped 27.5% in one month. By September,
the cost of living was up 99.8% and output in agriculture, industry, and mining begins to
drop. The Interior minister and others were impeached. The judiciary protested Allende's
actions. Both sides began courting the military. In October, a truck driver strike began
and spreads, costing $150-200 million.

To dampen fears of his government as well as to pacify the
independent military, Allende brought General Carlos Prat and other officers into the
cabinet to end the strike and insure elections but others struck at his government. Kennecott Copper sued in Paris courts to
stop Chilean copper from being unloaded from ships in French harbors and sold. But at year
end, the balance of payments deficit was $298 million; the net international reserves
deficit was $289 million; inflation was 163%; and real wages were down 7%. Agricultural
imports, however, went up to $400 million, up 84% over 1970.

Things got worse in 1973. Members of the UP coalition sped up the
organization of factory workers and neighborhoods into command centers to take control of
factories. The number of factories taken jumped drastically even though Allende was opposed
to the tactic. In January, the government began talk of rationing, including food. In the
March congressional elections, Unidad Popular got 43%, not the majority it had hoped but
still a strong showing. The government issued notice of a national unified school system
to begin in June; since this would adversely affect its schools, the Church joined the
opposition to the government. On May, the Supreme Court denounced decisions of the Allende
government. Workers in the El Teniente and other copper mines struck against the
government for better wages, ironic because the government claimed to be a workers'
government.

Anti-Allende events increased in the summer. On June 29th,
there was an attempted coup but the army remained loyal and stopped it. On July 26th
, a truckers' strike began which lasted until the coup on September 11th. It
crippled the economy because goods could not be moved around. Most of the truckers were
small businessmen; they had been hurt by Allende's policies. Some think that the CIA
financed the strike. On August 9th, military officers were brought into the
cabinet. There was an abortive navy mutiny, and, on the 17th, Allende dismissed
some chief naval officers. On the 21st, officers' wives who were protesting
Allende's policies were tear-gassed, a gross tactical error for it infuriated the
military. General Carlos Prat left on the 22nd. Allende had lost the support
of the officers who believed in following the constitution. The inflation rate had reached
323%.

On September 9th, Socialist Party leader Altamirano admitte that he
incited a mutiny in the navy. That was the last straw; the military would not tolerate the
encouragement of insubordination in its ranks. Telephones began ringingd in military
offices and homes; assurances were given by commanders that they would participate in the
coup or stay neutral. On September 11th, led by General Augusto Pinochet, the
Army Chief of Staff, they overthrew Allende and installed a military dictatorship. No one
is sure how many were killed by Pinochet and his minions. Estimates range from 5,000 to
15,000. Allende died in the presidential palace by his own hand. Some say he was killed.

Most of Allende's problems were of his own making. The economic
changes were so fast and furious that they destabilized the economy. Fearing the loss of
their property, investors moved money into safe places. Owners cut production
in order to reduce the possibility of loss. No one had to encourage them. Agricultural
production fell as the modes of production were disrupted. Perhaps agrarian reform would
have brought increase over time but Allende did not have the time. At the end of 1973, the
balance of payments deficit was $253 million; net international reserves deficit were $442
million; and the inflation rate was 508%.

General Pinochet decided to stay in power and stay and stay. He was a ferocious, murderous dictator.
He would stay from 1973 until 1990 as a very tough dictator. In 1975, a high member of
President Richard Nixon's security team said that the Pinochet regime was so paranoid that
it was accusing the Nixon administration of being part of "the international
Communist conspiracy" and that the Nixon administration was treading lightly in order
to save as many people as possible from the outrages of the Chilean government. No one had
foreseen that the Chilean military would strike with such ferocity.

Pinochet wanted the abolition of "politics" and its
institutions such as the congress, constitution, and political parties. His administration
took over education tp purge it of leftist, liberal, centrist, and, at times, conservative
teachers and thoughts. For the economy, he hired advisors from the United States, the
"Chicago Boys", followers of Milton Friedman of the University of Chicago.
Inflation rates decreased slowly going from over 500% in September 1973 to 180% in 1976 to
30-35% in 1978 to 10% in 1982 and between 20% and 31% between 1983 and 1987. The slow
decline was surprising because one of the hallmarks of the Friedman school is control of
the money supply. The regime and its economic advisors created high unemployment to
relieve pressure on prices and encouraged foreign firms to buy Chilean firms. By the end
of 1986, the Gross Domestic Product per capita barely equaled that of 1970 and per capita
consumption was 11% less than that of 1970. Economically, at least, the average Chileno
suffered under Pinochet. In the October, 1988 plebiscite, 55% of the voters said no to the
continuance of Pinochet. Christian Democrat Patricio Aylwin was elected in 1989 to succeed Pinochet, who became az Senator for life and immune from
prosecution. However, efforts to prosecute him in the twenty-first century were stopped only by his death in 2006.

Pinochet left the country in bad shape. In 1991, approximately $4.35 billion flowed out of the Chilean
economy in debt payments and profits to foreign investors, fully 25% of Chile's Gross
National Product. The military regime did away with many taxes such as corporate tax and
consumption taxes on alcohol. Personal taxes for the wealthiest segment of the population
became very low. The government tax base was reduced. It could no longer be an
activist government, which was the point of reducing its income.