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Written by Jhr Cronos.
Surely most of you know that in Chile, the recently elected constituent assembly to throw away Pinochet’s constitution will be dominated by independents with a left-leaning tendency, and by left-wing parties. Most do not know, however, that the Communist Party fully entered the constituency and also won the government of several Chilean provinces and cities, including the capital Santiago.
On the other hand, a fair number of the constituents are from the center left (former president Bachelet’s group), which could and will try to associate with the right wing parties to defend as much as possible the current status quo, obtaining veto power. The political right is betting on it and working to achieve it since day 1 after the constituent assembly was elected. This author believes that they will not achieve much, because Chileans will go out to the streets pressing for any questionable article, and those of the center left do not want to suffer another beating at the urns. The most popular proposals will be approved, such as those for education, energy and more autonomy for the regions; and above all, more autonomy for regions with a majority of indigenous people, such as the Mapuches.
Now, supposing that the current Chilean political trend continues: privileges of private sector diminish, the state assumes control or at least participates more in strategic industries and services, Mapuches and others take control of the mineral and forest resources in their territories, and in the coming presidential elections the candidate of the communist party wins (we are already far ahead, but that’s the trend).
Does this represent a great blow to the world hegemonic system, led by the United States? Well, not for the empire. The main Chilean commodity, copper, has always had a state controlled component and will continue to do so. It will be sold on the international market at market price, as always. The Chilean market, although with good purchasing power for Latin America, is only 19 million inhabitants. It is not in the middle of any extremely important trade route, except for easy access to some areas of Argentina. For a long time England has not needed Chile in its fight against Argentina, and US do not need it for Plan Condor 2.0 or the like (if needed, there is Colombia). Chile today, exerts economic influence on its neighbors, and not military. And this economic influence, with the face of large commercial and agricultural companies buying, cultivating and dominating some markets in Peru, Bolivia and Argentina, will not change with the new political situation. Why would it change?
However, in a more diffuse way things will change. The United States, the IMF and other hegemonic institutions have always (since Augusto Pinochet US backed military coup) set Chile as an example. They also did it with Argentina during former president Ménem’s government, but it collapsed badly. They now had Chile, but Chilean people has rejected them, despite showing good numbers in their macroeconomics. The regional left parties will always be able to use that fact: even when right wing governments are doing relatively well, the population rejects right-wing policies. Chile was the cradle of the AFPs (private pension fund managers) that expanded throughout the Latin American region. Today they are despised in Chile, and that contempt is spreading throughout the region with the help of the pandemic, and will be hitting the financial system hard. The expansion of Chilean multinationals in the region would slow down, concentrating their resources on fighting and boycotting their future government. There will probably be some capital outflow, but the companies themselves will not leave the country. In international matters, it would take a position similar to that of Mexico, of non-intervention in Venezuelan affairs, for example, and better diplomacy with China. Nothing to flashy. To this day, this author does not consider the Chilean political left as internationalist. But everyone can make mistakes, who knows?
Could we see attacks from the hegemonic powers to Chile? Yes. Economic ones of course, but it will depend on how much Chile wants to control their own economy. There is a looming battle with the agribusiness sector, along with struggles for use of water resources (Chile has a serious water shortage). Chilean agriculture is well placed in international markets, and with growing Chinese demand the price and distribution of food from Latin America will be a matter of competition for international powers. There is no much more in the short term. If a hypothetical real left government is consolidated in Chile, and it is re-elected for a second, then and only then would the United States act in a more specific way, to prevent it from setting an example. The “domino effect” so widely used in the cold war. Meanwhile, they will let the Chilean oligarchy take the lead against his government.
Regionally, it seems more and more governments are taking a turn left. Chile amd now Peru. The domino effect may also be in effect.
Going left is the last thing South America needs.
Free market economics will deliver higher living standards to the degree that governments establish the ground rules to promote competition. Antitrust legislation is part of this, as are protections for the media and free speech in general.
The leftist approach of socialism and communism will deliver market concentration, higher prices and reduced economic output. Leftism also leads to the diminution of human freedom as the state expands.
In other words, Leftist will even lower living standards for Latin Americans.
Just wait.
Read, “Leftism”.