Chile
A Changing CountrySpring 2004
Modernization a la Chilena
Integration and ExclusionGonzalo de la Maza
On the 30th anniversary of the coup in 2003, Chile also celebrated two decades of practically uninterrupted economic growth and 15 years of peaceful transition from dictatorship to democracy. The last two processes differentiate Chile in a positive sense from many of its neighbors in Latin America and in a certain way is an unexpected result of the struggle for democracy in the 1980s.
Even those post-1990 new democratic authorities who did not believe in the neoliberal economic model imposed during the military dictatorship continued and deepened it?with certain variations. This has resulted in good macroeconomic results. More than a decade of growing beyond historical rates, followed by another period in which Chile surpassed most of Latin America, which has been severely punished by different economic crises. In the political arena, on the other hand, after 15 years of democracy, the anti-democratic 1980 political constitution imposed by Pinochet is still in effect. Many of the institutions built up by him are still operating.
Since 1990, active social policies have helped to reduce Chile's rate of absolute poverty in contrast with the rest of the continent. In spite economic growth, political stability and a overall improvement in income levels, an effective strengthening of civil society?greatly weakened by 17 years of dictatorship? is still lacking.
Indeed, inequality of opportunities among social groups is more entrenched and various types of social disintegration are on the rise. Political participation, as well as democratic commitment, has declined considerably since the first years of transitional governments.
The road of ?modernization? agreed upon by economic and political elites at the end of the 1980s did not look at the shaping of society as a goal. Rather, it focused on economic growth, institutional political ?normalization? and so-called ?payment of social debt.? The goal was to try to maintain the conditions of economic growth and to add on a more active social policy. Naturally, that could not change the basic course of the productive structure. Therefore, the transition?s relevant social achievements could not be translated into stable integration and social participation.
The situation described above permits a rereading of the post-dictatorship period. The majority of the population had been objectively and subjectively excluded because of unemployment, repression and poverty before then. In the post-dictatorship period, the majority of the people were summoned to a new kind of inclusion through consumerism and institutional democratic participation. But actual economic inclusion has been precarious, partial and profoundly unequal.
In the political realm, the limitations of the transition, the reduced role of the state and "authoritarian enclaves" impede significant changes and real participation. Citizens experience insecurity, the sensation of a powerlessness, fear and lack of control over their own lives. The public sphere is weakened because of a perception of "the lack of recognition and representation of public institutions, especially those charged with creating ties for the related with modern citizenship", as the United Nations Development Programme (UNDP) pointed out in its 1998 Report on Human Development.
Partial Integration in modernization a la chilena
Social policies, including higher wages and minimum pensions, as well as low levels of unemployment until 1998, contributed to an increase in Chileans? income during the 1990s. Yet inequality of opportunities increased during this period. Workdays became longer and Chilean families found themselves deeper in debt. Inequality has gone hand in hand with economic modernization, creating a social fissure that is now having political consequences.
In 1990, 38.6% of the population received monthly income below poverty level. In the year 2000, the number had declined to 20.6%, some three million Chileans, according to the Poll on Socio-Economic Characteristics. Yet even this positive showing has not reached the level of 30 years ago, when in 1973, only 17% of the population was below poverty level. As the economy improves, the contrasts are sharper. Statistics show that 10% of today's poorest Chilean homes have decreased from receiving 1.5% of the wealth, to only 1.3 % with an average income of $80 monthly. In contrast, the wealthiest 10 %, captures 41%, of Chile?s total income and earns an average of $3,000 monthly. Poor households have a larger number of members, which means that each person in the wealthiest sector of the population has income 40 times greater than each of Chile?s poorer citizens.
Recent studies, including a World Bank report, indicate that the structure of income distribution in Chile is not much different from that of other Latin American countries, except in relationship to the highest income group, which enjoy a disproportionately great concentration of resources and opportunities. At the beginning of the decade, Chile put the problem of the ?five million poor? on the table as the main challenge for social policy. We can now say that the ?five hundred thousand rich,? richer by the day, are the country?s main problem. The society has managed to increase resources for the poor so they can survive. However, by not reducing inequality, it has blocked the social availability of the necessary resources to live together in harmony. Because sobrevivir is not the equal to convivir.
Political Policies of a Small State
The contribution of public policies has been crucial to the increase in income of the poorest. However, employment, closely linked to the evolution out of poverty, and other key factors have not been tackled. While economic growth averaged more than 6% in the last decade, employment has only increased 0.8% yearly. This means that poverty decline has also been slower, particularly among poor women and youth. The latter experience unemployment at three times the rate of adults. The jobs that have been created are mostly in the informal sector and thus precarious, with low wages and bad working conditions.
The amount of resources destined toward social policy has increased steadily, particularly in the areas of health and education, although the impact of this investment has been relatively low. Meanwhile, the majority of the innovative agencies in the public sector created since 1990 have experienced crisis after crisis and have not managed to integrate themselves into the traditional structure of the state.
Chile's public social expenditure has doubled in absolute terms from 1990, according to the official report of the follow-up meeting of the World Social Development Summit. It has grown a bit more than two percentage points of the GNP and represents three-fourths of all public spending. How is it possible that in spite of these efforts by the public sector, the increasingly unequal structure of Chilean society has not been altered? We don?t understand why, World Bank economist Guillermo Perry recognized at the beginning of the year. Probably the answer is that only public expenditure is redistributed, while the major sources of income tend to be highly concentrated. Almost half of public expenditure is used to pay pensions, a percentage that will only increase in the future as Chileans grow older and the state assumes responsibility for its uncovered or under-covered citizens. Many of them work for the exportation activities, the dynamic ?modern side? of Chilean society.
Public expenditure also has a limited impact because it represents only a fifth of total economic expenditure. Thus, paradoxically, state monetary transfers represent 31% of the income for Chile?s poorest 10%, but their income participation has only improved 0,1%. At the same time, consumers are more frequently paying for public services themselves, 50% in health, almost 40% in housing and 10% in education with a growing tendency for shared costs between the consumer and the state.
The archipelago of civil society
The capacity of social groups themselves to act upon the public stage has diminished since peaking in the early 1990s. No normative framework exists in Chile to favor the growth, consolidation and influence of an active civil society. Non-governmental organizations, previously a factor in setting the social agenda, have been reduced to carrying out the spending of public funds, as a way of broadening the outsourcing of government programs.
The associative tradition subsists, but it is materialized in an infinite number of organizations without common links nor any real weight in public affairs. In 1999, PNUD identified the high number of associations of all types in Chile as reaching 83,000 without even counting religious organizations. This high number reflects only a potential strength but not a social dynamic with the corresponding capacity of influence. The labor sector, in which the rate of unionization has dripped and the number of union members have fallen by a third, is an example of this trend. The only thing that has actually increased is the absolute number of unions, little entities without any real power. According to PNUD data, a greater number of participation in formal organizations is found only in the upper classes, together with a greater ?informal social capital of its members.?
The disintegration and subjective fear reflect the loss of ?power? of civil society concerning matters in its area of competency and have led to a lack of political participation. This has permitted the emergence of a powerful neo-conservative populism: technocratic and authoritarian with an anti-political discourse constituted as an alternative to real power.
During the 1990s, the relationship between society and the state were once again redefined. The state?looking ?upward??concerned itself with guaranteeing optimum conditions for the operation of an export economy in which foreign investment and the financial sector predominate. Looking ?downward,? the state focused its actions on the poorest of the poor with fragmented strategies and without a framework of universal rights necessary to foment social integration. In Chile, there is no normative framework to favor the development, consolidation and influence of an active citizenry.
New Challenges for an Integrated Chile
The previous arguments allow us to identify challenges in the search for a new social integration in which the role of the civil society is fundamental, given the limitations of the state action and priorities. Social and cultural exclusion must be placed on top of the agenda. The process of economic modernization integrates some and excludes others, increasing social differences. In this fashion, poverty and marginalization are not clumped together in large homogeneous groups, but assume multiple guises throughout the country.
Social action in those sectors in which diverse factors for marginality and discrimination are concentrated such as workers?men and women?who work in precarious tasks without access to basic labor rights. Especially those temporary workers in the?modern? export-oriented sectors such as the fruit and fish processing industries and in the lumber trade. Labor rights have to be sought for the distinct forms of work that are prevalent today among the poorest: subcontracts, domestic work and other labor carried out in people?s homes. The inclusion in the workforce of the poorest women?with little education and without access to services?must be improved by widening services to take into account the reality of a broad range of women.
The traditional rural sector throughout the country lacks access to new productive activities, not experiencing any improvement in their capacity to earn a living, in spite of large investments in social infrastructure. The Mapuche peasants, not only expelled from their lands, but also enduring the pressure of multinational lumber companies, fall into this category. But so do urban youth, with high rates of unemployment, low salaries, increased school dropout rates and increased participation in crime and drug networks. The ?stigma? of these youths as dangerous has increased without taking into account the origins of the problem. That?s not limited to Santiago, but has extended to rapidly growing medium-sized cities because of the lack of opportunities in the rural sector.
Some social sectors also experience cultural marginality: sexual minorities, families who do not conform to traditional patterns, ethnic groups and traditional cultures. Basic rights in the sexual and reproductive areas are not recognized; neither is divorce legal in Chile. Freedom of expression exists, but not the channels of communication with which to sustain discussion about culture and values reflecting the country?s diversity.
Another priority is the democratization of public spaces, increasingly in the hands of private interests. In this case, effective social participation and public access to instruments of influence need to shape societal decisions and directions. The democratization of public spaces spans a broad range that includes from physical access to public spaces such as plazas, beaches, sports facilities, natural resources, cultural and communitarian infrastructure to the need to democratize and regulate the mercantile operation of the media. A particular concern is the need for equitable and high quality education that does not discriminate and is culturally relevant to the country?s different realities.
Finally, the key is to strengthen citizenship: to keep on advancing in the promotion and effective respect of women?s rights, the stimulation of popular participation in decision-making, particularly in local measures, new forms of social organization adapted to Chile?s technological, educational, demographic and cultural changes, actions against distinct forms of discrimination and the deepening of the decentralization process and the democratization of local spaces. All these factors will lead to all Chileans becoming equal citizens.
Gonzalo de la Maza, sociologist, is director of the program on Citizenship and Local Management at the Fundación para la Superación de la Pobreza in Santiago, Chile. He was a Spring 2003 Ford Foundation Visiting Scholar at the David Rockefeller Center for Latin American Studies.