Chile as a political economy
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Chile as a political economy has in recent years served as a laboratory for differing governmental policies that would later become models of political and economic development. Salvador Allende was the first Marxist to be elected to a Latin American nation's highest office, and he vowed to create a revolution in Chile by means of peaceful, democratic processes, and this became known as la via chilena among revolutionary theorists. Allende speeded up the pace of land reform, expropriated foreign-owned copper mines, took over the nation's largest banks, and pursued wage an price policies that would dramatically increase the income of the nation's poor. However, because he finances his programs by means of printing more money, he also introduced hyperinflation that by mid-1973 was increasing prices at an annual rate of some 500 percent. His policies alienated the U.S. government, the Chilean upper class, over time the middle class, and finally the armed forces, leading to the coup of 1973 when a military regime assumed power (Merrill, 1982, xvii-xviii). The issue is what did the election of Salvador Allende mean for Chile, and the answer should consider the many segments of Chilean society and how they were affected by his presidency.The previous era had extended from 1964 to 1970 and had been the administration of President Eduardo Frei Montalva. It was a textbook example of a centrist political economy (Merrill, 1982, xvii). This period had also awakened the expectat
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tion. Some leaders in the Socialist Party, however, favored rapid and radical socialization of society by means including extralegal or unconstitutional procedures. Allende agreed more with the Communist Party than with his own Socialists (Merrill, 1982, 36-37).
Allende's economic policy had immediate consequences, and one of the first was a sharp increase in wages. By July 1971 wages and salaries had been raised by almost 55 percent. The legal minimum wage was increased by about 66 percent. The government also instituted massive increases in public spending partially as a way of stimulating employment so that by September 1971 public expenditures had increased by nearly 80 percent over those a year earlier. The government tried at the same time to hold the line on prices in an effort to control inflation, and the policy was successful for most of 1971--between December 1970 and december 1971, the consumer price index rose by 22 percent, while during the previous 12 month period it had risen by nearly 35 percent. by late 1971, though, food shortages were becoming noticeable, and beef in particular was difficult to find on a daily basis. These early shortages were brought about by increased consumption rather than decreas
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Some common words found in the essay are:
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Approximate Word count = 1808
Approximate Pages = 7 (250 words per page)
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