In turbulent times, Chileans vote with ballot papers and wallets
Santiago Miguel Torres is the archetype of what might be called the Chilean Dream.
After dropping out of college, he nevertheless rose from his working-class roots thanks to decades of economic stability and Asian Tiger-like growth to build a successful career as the owner of a small outdoor advertising business.
But in the run-up to Sunday’s presidential election, the 68-year-old is trying what was previously unimaginable: selling the spacious home he built with the hard work of his life. While he doesn’t have any offers, if he’s lucky enough to find a buyer, he plans to pile the proceeds overseas and downsize.
“I’m too old to leave the country,” he says, checking out the pool and the giant camellia trees that decorate his home in the Tony los Condes neighborhood of Santiago, the capital. “But I won’t leave the little money I have here.”
Torres is not the only Chilean on the brink.
After an intense wave of social and political turmoil in recent years that has included current efforts to rewrite the constitution, Chileans are heading to the polls with a mixture of dread, optimism and above all uncertainty about what awaits them.
The country has long stood in sharp contrast to its chaotic neighbors such as chronically defaulting Argentina in the east or in the north, Peru, which has had five presidents since 2018.
But there is growing frustration with the free-market model and its inability to root out disturbing inequality and provide quality, affordable public services in a country of 19 million people.
Polls consistently put two of the frontrunners ahead of all the others in the seven-candidate race, although neither of them came close to the 50% threshold needed to avoid a run-off in December.
One of the rivals, Gabriel Borek, is a 35-year-old former protest leader who has formed an alliance with the Communist Party and promised to “bury” Chile’s past as a model of neoliberalism – a heavy blow to the general’s imposed reforms in the 1980s. Augusto Pinochet.
The other, José Antonio Caste, is a former fringe candidate from the far-right in Chile with a long history of defending the rule of the dictator and attacking what he calls the “gay lobby” in Chile.
In the lead-up to the vote, Chileans like Torres were voting with their wallets, opening dollar-denominated bank accounts and moving their savings abroad in the time-tested way like their neighbors in Argentina.
Capital flight by non-company businesses and households jumped to $29 billion in the twelve months to September, nearly 70% more than reported outflows the previous year. Bond prices and the peso also fell sharply.
“Seeing such political risk-taking behavior is very new in Chile,” said Jona Rosenthal, a Latin American economist at the Institute of International Finance, a Washington-based trade group that represents major international banks. There is no roadmap for navigating uncertainty.”
Reflecting the recent unrest in Chile, and the increasingly polarized South American politics, the two leading candidates are a study of the contrasts.
Poric, who grew up in the vast region of Patagonia where his Croat ancestors settled, emerged as the leader of protests a decade ago to demand higher quality and lower-cost education. Like a host of other student activists, he was elected to Congress in 2014, and is known for his casual attire, endearing tattoos, and even a Mohawk at one point.
He dismissed criticism that he was ignoring protocol, describing such things as “a tool for elites to distinguish themselves from outsiders.”
Modeled on the left-wing coalition of the same name in Uruguay, the Broad Front has proposed raising taxes on “the super-rich” to pay for expanding public services and protecting the environment.
He also wants to eliminate Chile’s privatized pension system – a hallmark of the Pinochet years that successive democratic governments have been reluctant to touch despite mounting evidence that the employee-only scheme leaves the masses of the Chilean working class without enough to retire.
Kast is the son of a German who served in Hitler’s army during World War II and immigrated to Chile in the 1950s. An outspoken admirer of Brazil’s far-right President Jair Bolsonaro, his newly formed Republican Party is seeking to cut corporate taxes and government red tape.
He ran a law and order campaign that stirred divisions on social issues such as abortion, LGBT rights, immigration, and the role of religion in schools.
He is also highly critical of Chile’s outgoing president, fellow conservative Sebastian Pinera, for reaching a deal with his political enemies – including Borek – to rewrite the Pinochet-era constitution in the wake of massive protests sparked by rising subway prices in Santiago.
If elected, Caste could win presidents with the left-leaning assembly drafting the new constitution which, in theory, could shorten the next president’s term.
In true Chilean fashion, Borek and Caste have in the last phase attempted to downplay the radicalization of the past, hoping to appeal to moderate voters who make up the bulk of the electorate – a trend likely to continue in the run-off scenario.
But many Chileans are not convinced, even if a belated increase in opinion polls by Caste — whose brother was a University of Chicago-trained economist who designed Pinochet’s economic reforms — calmed market tensions somewhat.
said Juan Sutil, owner of a large food conglomerate and president of the influential Chamber of Commerce and Production.
Torres, who had already begun converting some of his savings into US dollars, also worried that pressing social demands would weaken Borek’s hand with his communist allies.
“They will put pressure on him,” Torres says.
But others say Chile, uniquely located in a region riven by turmoil, is channeling the resentment right.
Sergio Bitar, who served in the socialist administration of Salvador Allende that was toppled by Pinochet as well as several center-left governments since then, said the Chilean “economic miracle” myth is long gone. In indicators such as household income and poverty, the country lags far behind its counterparts in the Organization for Economic Development, a group of 38 most advanced countries in the world.
However, he regrets that Borek and his supporters have chosen to focus so much of their discontent on old moderates like himself.
“Let’s hope that young people don’t make the same mistake we did in underestimating the right,” said Bitar, who was forced to live in exile for years after Pinochet imprisoned him in the 1973 coup.
He said that while every generation tries to shatter the status quo it inherits, political leadership requires compromise as well as idealism.
“Politics is the art of what is possible. Without governance there can be no progress,” said Bitar, who fears Chile’s best years may be behind it and the country may slip into the mid-level malaise seen elsewhere in the region. “.
Joshua Goodman reported from Miami.
Joshua Goodman on Twitter: APJoshGoodman
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