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Technocrats and Politics in Chile: from the Chicago Boys to the CIEPLAN Monks

  • Patricio Silva (a1)

During the last 25 years Chilean society has experienced profound socioeconomic, political and even cultural changes. From 1964 to 1970 there was a ‘revolution in liberty’ under Eduardo Frei, from 1970 a ‘Chilean road to socialism’ under Salvador Allende, and from 1973 to 1989 a ‘silent revolution’ under Augusto Pinochet.

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1 Gross, Leonard, The Last Best Hope: Eduardo Frei and Chilean Christian Democracy (New York, 1967); Zammit, Ann (ed.), The Chilean Way to Socialism (Austin, 1973); Oppenheim, L. H., ‘The Chilean Road to Socialism Revisited’, Latin American Research Review, vol. 24, no. 1 (1989), pp. 155–83; Lavin, Joaquín, Chile: revolución silenciosa (Santiago, 1987); Tironi, Eugenio, Los silencios de la revolución (Santiago, 1988).

2 ‘Individuals with a high level of specialized academic training which serves as a principal criterion on the basis of which they are selected to occupy key decision-making or advisory roles in large, complex organizations — both public and private.’ Collier, David (ed.), The New Authoritarianism in Latin America (Princeton, 1979), p. 403. I include in this definition not only the traditional técnicos (economists, agronomists, financial experts, etc.) but also those social scientists (sociologists, political scientists, etc.) commonly catalogued as intellectuals.

3 As the members of the private research centre CIEPLAN have been dubbed by the Brazilian sociologist and Senator Fernando H. Cardoso. See ‘CIEPLAN monks take command in Chile’, Southern Cone Report, RS-90–03 (19 April 1990), p. 4.

4 On the role of political parties in the Chilean democratic transition see Garretón, Manuel Antonio, ‘Partidos políticos, transitión y consolidatión democrática’, Proposiciones, no. 8 (01. 1990), pp. 7284.

5 See for instance Conaghan who argues that the severe economic crises of the 1980s have favoured technocratic decision-making at the government level in Andean countries. Conaghan, Catherine, Capitalists, Technocrats, and Politicians: Economic Policy-Making and Democracy in the Central Andes, Kellog Institute Working Paper, no. 109 (Notre Dame, Ind., 1988).

6 Most of the political parties in Chile before the coup d'etat were essentially elite parties in which intellectuals played a key role. This was certainly the case of the Christian Democratic Party and the Socialist Party. See Petras, James, Politics and Social Forces in Chilean Development (Berkeley, 1970). See also Gil, Federico, The Political System of Chile (Boston, 1966). Two universities, the Universidad de Chile and the Universidad Católica of Santiago, have historically constituted the main sources of recruitment of the intelligentsia who controlled the political parties. As Angel Flisfisch has pointed out, the expression ‘los de la Católica’ versus ‘los de la Chile’ clearly reflects the main front-line dividing the Chilean intelligentsia. See Aldunate, Adolfo et al. , Estudios sobre los sistemas de partidos en Chile (Santiago, 1985), p. 159.

7 Gramsci, Antonio, Selections from the Prison Notebooks (London, 1971), p. 8.

8 Hirschman, Albert O., ‘The turn to authoritarianism in Latin America and the search for its economic determinants’, in Collier, The New Authoritarianism, pp. 86–7.

9 This was made possible by the rapid expansion of existing state institutions and by the foundation of new ones. This resulted in the creation of thousands of new jobs for young professionals, militants of the Christian Democratic Party.

10 A clear example of the anti-technocratic bias which dominated Chilean politics at that time was the dismissal of the Minister of Agriculture, Jacques Chonchol. He was severely criticised by radical sectors (from within and outside the Popular Unity coalition) for slow implementation of the land reform. He was finally accused by his political opponents in the government of being a ‘technocrat’, a label which provided his political ‘death-sentence’. Soon afterwards he was replaced.

11 See Kay, Cristóbal, Latin American Theories of Development and Underdevelopment (London and New York, 1989).

12 Prebisch later synthesised his criticism of the monetarist (neoliberal) school in his ‘Diálogo acerca de Friedman y Hayek, desde el punto de vista de la periferia’, Revista de la CEP AL, no. 15 (12 1981), pp. 161–82.

13 See Calcagno, Eric, El pensamiento económico latinoamericano: estructuralistas, liberales y socialistas (Madrid, 1989).

14 For a detailed study of the University of Chicago's activities in Chile, see Valdés, Juan Gabriel, La Escuela de Chicago: Operatión Chile (Buenos Aires, 1989).

15 Considered the most influential exponent of the Chicago School. His book Capitalism and Freedom (Chicago, 1962) became a leading handbook among his Chilean followers. Friedman was awarded the Nobel Prize for Economics in 1976.

16 Délano, Manuel and Translaviñia, Hugo, La herencia de los Chicago boys (Santiago, 1989), pp. 23–7.

17 O'Brien, Phil, ‘The New Leviathan: the Chicago boys and the Chilean Regime 1973–1980’, IDS Bulletin, vol. 13, no. 1 (12, 1981), p. 39. See also O'Brien, Phil and Roddick, Jackie, Chile, the Pinochet Decade: The Rise and Fall of the Chicago Boys (London, 1983).

18 Vial, Marisol, ‘Chicago boys: cómo llegaron al gobierno’, Que Pasa, no. 548 (10 1981), p. 26. See also Fontaine, Arturo, La historia no contada de los economistas del presidente Pinochet (Santiago, 1989).

19 Friedman's address to the seminar was simultaneously published and distributed in the form of a small book by the Fundación de Estudios Económicos. See Milton Friedman en Chile: bases para un desarrollo económico (Santiago, 1975).

20 Moulian, Tomás and Vergara, Pilar, ‘Estado, ideología y políticas económicas en Chile, 1973–1978’, Colección Estudios CIEPLAN, no. 3 (06 1980). It must be said, however, that the leaders of the gremialista movement (an ultraconservative political current of Catholic origin) also played an important role concerning the political system promoted by the military regime (being the main authors of the junta's Declaratión de Principios of 1974 and the 1980 Constitution). Gremialistas such as Jaime Guzmán and Sergio Fernández were as much the architects of the new order as the Chicago boy Sergio de Castro. The fact that neoliberals and gremialistas came from totally different intellectual backgrounds (and held opposing positions on many issues), was no impediment to their cooperation with the military regime, nor to their joint activities in the formation of the right-wing party Unión Democrática Independiente (UD1). As Vergara has clearly shown, the convergence achieved between the Chicago boys and the gremialistas was primarily the result of the gradual ‘neoliberalisation’ of the latter. Vergara, Pilar, Auge y caída del neoliberalismo en Chile (Santiago, 1985), pp. 168–75.

21 Presupuesto, Dirección de (DIPRE), Somos realmente independientes gracias al esfuerzo de todos los chilenos: documento de político económica (Santiago, 1978), p. 305. Baraona is one of the leading figures of the Chicago boys, and he has twice been Minister of Economic Affairs during the military government.

22 For instance, between 1975 and 1981 the number of cars in Chile doubled. By 1984 42% of families in Santiago were paying back one or more consumer loans. Martinez, Javier and Tironi, Ernesto, Las clases socialies en Chile: cambio y estratificación 1970–1980 (Santiago, 1985).

23 Meller, Patricio, ‘Los Chicago boys y el modelo económico chileno, 1973–1983’, Apuntes CIEPLAN, no. 43 (01 1984). See also Tironi, Ernesto, El modelo neoliberal chileno y su implantatión (Santiago, 1982).

24 Arias, Raúl et al. , ‘El monetarismo como ideología’, Economía de América Latina, vol. 6, no. 1, p. 174.

25 Kaufman, Robert R., ‘Industrial change and authoritarian rule in Latin America’, in Collier, The New Authoritarianism, pp. 189, 190.

26 Baño, Rodrigo et al. , Las modernizaciones en Chile: un experimento neo-liberal (Rome, 1982).

27 Defined by Gramsci as the thinking and organising members of a particular fundamental social sector, who have the task of directing the ideas and aspirations of the group to which they organically belong. Gramsci, , Prison Notebooks, p. 3.

28 Professor von Hayek (Nobel Prize for Economics, 1974) taught in the Faculty of Philosophy at the University of Chicago. His book The Road to Serfdom (London, 1944) gave the Chicago boys the required theoretical and doctrinal foundations to expand their neoliberal thought from economics to the social and political spheres. Professor von Hayek became intimately involved in the application of neoliberal precepts in Chilean society. He accepted the position of honorary president of the Centra de Estudios Públicos, established by the Chilean neoliberal intelligentsia in 1980. He also visited the country several times, expressing his total confidence in the policies implemented by his ex-pupils (see for example his interview in El Mercurio, 16 April 1981).

29 Vergara, , Auge y caída, pp. 89106.

30 Named after von Hayek's book, Constitution of Liberty (Chicago, 1960).

31 See Ffrench-Davis, Ricardo, ‘El experimento monetarista en Chile: una síntesis crítica’, Colección Estudios CIEPLAN, no. 9 (12 1981). See also Foxley, Alejandro, Latin American Experiments in Neoconservative Economics (Berkeley, 1982).

32 See Rojas, Darío, El fenómeno Büchi (Santiago, 1989).

33 See Ames, Barry, Political Survival: Politicians and Public Policy in Latin America (Berkeley and Los Angeles, 1987).

34 Délano, and Translaviña, , La herencia, pp. 179–83.

35 ‘The democratic government neither envisages nor desires a return to a state-based pattern of development. On the contrary, the government will stimulate private initiative, interfering as little as possible with market decisions (…). It is also necessary to stimulate foreign investments. Fortunately, the ideological polarisation that existed in the past in Chile on this matter has been overcome.’ President Patricio Aylwin, in a speech to a seminar on foreign investment (El Mercurio, international edition, 17–23 May 1990, pp. 1–2). Minister of Economic Affairs Carlos Ominami (a member of the Socialist Party), explained the economic philosophy of the new Chilean government in similar terms to a group of leading industrialists and investors in Tokyo (see El Mercurio, international edition, 31 May–6 June 1990, p. 4).

36 One must not minimise the impact of exile in East European countries on many Chilean left wing political leaders. Their negative personal experiences of the socialist economies finally convinced them that this was not the kind of economic system they wanted for Chile after the restoration of democracy.

37 For a list of private research centres in social sciences established in Chile after 1975 see Lladser, María Teresa, Centros Privados de Investigatión en Ciencias Sociales en Chile (Santiago, 1986). On the role played by the NGOs opposing the military regime see Desarrollo, Taller de Cooperación al, Una puerta que se abre: los Organismos no Gubernamentales en la Cooperación al Desarrollo (Santiago, 1989).

38 Brunner, José Joaquín, ‘Las ciencias sociales en Chile: el caso de la sociología’, Documento de Trabajo FLACSO, no. 325; (12. 1986), pp. 26–8.

39 See Kay, Diana, Chileans in Exile: Private Struggles, Public Lives (London, 1987).

40 That is the case of centres such as ASER-Chile (Paris), Casa Chile (Antwerp), Casa de Chile (Mexico), Centro de Estudios y Documentatión Chile-América (Roma), Centro Salvador Allende (Mexico), CETRAL (Paris), C1P1E (Madrid), and the Institute for the New Chile (Rotterdam).

41 See Angell, Alan and Carstairs, Susan, ‘The Exile Question in Chilean Politics’, Third World Quarterly, vol. 9, no. 1 (1987), pp. 148–67. The so-called ‘proceso de renovación’ experienced by several Chilean left-wing political parties since the late 1970s (which led to a definitive break with Leninism and towards a revaluation of democracy) is also directly related to the exile question. The exile of many Chilean political leaders in Eastern European countries was rather traumatic. There they directly confronted the dark side of ‘real socialism’. This is for instance the case of political figures such as Jorge Arrate (current leader of the Socialist Party) who moved after difficult years in former East Germany to the Netherlands, from where he initiated a profound theoretical and programmatic discussion within the Chilean socialist movement. See his El socialismo chileno: rescate y renovatión (Rotterdam, 1983), and La fuerza democrática de la idea socialista (Barcelona and Santiago, 1985). For an analysis of the significance of the socialist renovation for Chile's process of democratisation see Garretón, Manuel Antonio, Reconstruir la Politico: transitión y consolidatión democrática en Chile (Santiago, 1987), pp. 243–92.

42 Thus, in an evaluation made by the Swedish Agency for Research Cooperation with Developing Countries (SAREC) it is stated ‘[We] succeeded in preserving research capacity under conditions of repression and political crisis. Support for private national centres has enabled people to continue research projects after military intervention in the universities. These centres also house researchers expelled from academic or government agencies because of political persecution.’ Spanding, H. et al. , SAREC's Latin American Programme: An Evaluation (Stockholm, 1985), p. 1. See also Brunner, José Joaquín, ‘La intelligentsia: escenarios institucionales y universos ideológicos’, Propositions, no. 18 (01. 1990), pp. 180–91.

43 Arellano, José Pabloet al., Modelo económico chileno: trayectoria de una crítica (Santiago, 1982). This is a selection of these articles published between 1977 and 1981. This book became very controversial at that time, because it showed that since 1977 the researchers at CIEPLAN had constantly been predicting the eventual collapse of the neoliberal economic model, which finally occurred in 1981.

44 Foxley, Alejandro, Para una democracia estable (Santiago, 1986). See also his ‘Economic and Political Transitions in South America’, in Galjart, Benno and Silva, Patricio (eds.), Democratization and the State in the Southern Cone (Amsterdam, 1989), pp. 75101.

45 Brunner, José Joaquín, Recursos Humanos para la Investigatión en America Latina (Santiago, 1989), p. 115.

46 The democratic government has given ODEPLAN a ministerial status, and changed its name to M1DEPLAN.

47 For instance, the CIEPLAN technocrats are sometime referred to by the press as the ‘CIEPLAN boys’, to stress the similarities with their predecesors (see, e.g., El Mercurio, 11–May 1990).

48 See, for instance, ‘Foxley, el hombre fuerte’, Hoy, no. 664, 91504 1990, pp. 3–5.

49 Despite their relative autonomy from the traditional party structures, one must still keep in mind that Chilean technocrats continue working inside political parties. Their current prominence has perhaps been strengthened by the fact that since March 1990 political parties are still defining their role after many years of inactivity. But even if in the near future (as a result of the normalisation of party activity and competition) more traditional politicians come to the fore, I do not expect a restoration of their old pivotal position within the Chilean political system. They can perhaps find a redoubt in the Parliament, but not in leading positions at ministerial levels, as was the case before September 1973.

50 It must be said that a similar process of technocratisation of politics (although less extreme) can be seen in Argentina, Brazil and Uruguay, where many technocrats who worked at private research institutes have occupied high positions at governmental levels after the reestablishment of democratic rule. See Brunner, José Joaquín and Barrios, Alicia, Inquisition, mercado y filantropía: ciencias sociales y autoritarismo en Argentina, Brasil, Chile y Uruguay (Santiago, 1987). In the Argentine case a group of prominent intellectuals has stated, ‘We do not recall in the history of our country any other government with a greater participation of public servants coming from the intellectual field, and not necessarily from political militants, than the government presided over by Alfonsín. (…) One of the most singular aspects of Alfonsín is his continuous attempts to attract technocrats and intellectuals into government and into the sphere of politics.’ Canitrot, Adolfo, Cavarozzi, Marcelo, Frenkel, Roberto and Landi, Oscar, ‘Intelectuales y política en Argentina’, Debates, no. 4, 1011. 1985, pp. 48. Actually, the same can be said for the Mexican case since the government of de la Madrid, and especially during the current government of Carlos Salinas de Gortari. See Camp, Roderic, Mexico's headers: their Education and Recruitment (Tucson, 1980).

51 ‘Instituto Libertad y Desarrollo: para producir ideas’, El Mercurio, 1 04 1990, p. 11.

52 ‘President Aylwin's government will preserve Chile's macro-economic stability and avoid the adoption of populist measures which has brought other nations in the region to a situation of hyper-inflation.’ Minister Alejandro Foxley in his ‘Estado de la hacienda pública’ speech to the Parliament, Valparaíso, 24 Oct. 1990.

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