September 15, 2013

Chile, once de Septiembre: imperialism teaches II

Indeed the nationalization process went on – within the existing bourgeois legal framework; more precisely, it had been based on a law passed since 1932, which typically had not been abolished, though it remained inactive and unknown even to most of lawyers.

Many more successes could be reported from the very first period of UP’s administration, such as 

  • the significant rise of the real income of workers,
  • the fall of unemployment from 8.8 % to 3 % and of infant mortality by 20,1 %. For the first time in the history of the country a universal health care system had been created. 

Other worth-to-mention successes of UP’s government action, include

  • spectacular progress in the field of literacy and public education;
  • expropriation of important latifundia, giving land to thousands of farmers;
  • reforestation of 600.000 acres;
  • foundation of farm cooperatives that began to change life in the village;
  • significant improvement of the situation of natives (“indios”).

 Such changes could be read as a vast capitalist modernization program; however, from the ruling class point of view, they were a clear sign of threat to its class interests. For the domestic bourgeoisie it was too risky to bet on some internal dynamics of fading UP’s action out. For imperialists, the issue was explosive, as Chile could show that peoples’ social liberation can happen without being drowned in blood. So they needed to counterattack – as they had done, following an elaborate, multilevel action plan.

The first objective was to overthrow UP from government.
Some major points of this plan become known as it started to get implemented:

  • creating a chaotic situation: this meant systematic paralysis of state institutions, economic sabotage, boycotts, support and reinforcement of fascist gags, for organizing assassinations and spreading terrorism.
  • economy war at the international level: credit restrictions from international and above all the American banks, embargo in copper trading and petrol supply, measures to cause insolvency by currency restrictions, withdrawal of commercial agreements for U.S. exports, especially on copper mining technology and other means of production.

During the same period, Chile, despite renegotiations with foreign creditors, was forced to pay every year 200 million U.S. dollars for external debt payments.

Thus, in the last months of 1971, approximately one year after the election of Allende, the results of this pressure had become visible in Chile’s economy and finances: rise in the cost of living, problems in the supply of products and recession. But the forces of UP, or at least the majority of them, were still having illusions about the possibilities for the government to tackle the economic crisis and the attack of big capital and imperialism, while the country was being kept inside the capitalist framework; they were not politically conscient that there was just one problem behind anything else, and that this problem was getting always more urgent and crucial to solve. "Which class  has the power" is a condensed statement for this problem.

UP’s government had tried to cope with the difficult situation by increasing taxation of the wealthy classes in order to increase state revenue. At the same time, they also appealed on workers for increasing production and productivity of labor.


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