The Neoliberal State Flashcards
The Chicago Boys
Group of Chilean economists educated at UOC Department of Economics under Milton Friedman, Larry Sjaastad, and Arnold Harberger.
Where did the Chicago Boys begin?
Returned to Latin America, government officials across South America including Chile: Influencing Ronald Reagan and Margaret Thatcher
What they advocated?
Deregulation, privatization, other free market policies
Why they went UoC?
Following start of cold war, UOC and Chilean University partnered, exposing students to neoliberal ideologies to steer Chile from communism.
Beginging of Chilean revolution:
Price control, nationalization, money printing by Allende instigated coup by Pinochet with 700% inflation and wage drops.
Chicago Boys first act:
Freed up prices, interest rates, reprivatized state-owned businesses, deregulated banking system…
Consequences of Neoliberalisation of Chile:
Wealthiest South American nation, highest GDP per capita, lowest poverty rate, best indicators for health.
How Pinochet crated policies?
Killed 2,279 people in 17 years, killed opposition leaders, reforms could not be implemented in a free society.
How this took a turn in 2019:
Violent demonstrations when Subway fares increased, calling for ends to corporate abuse, profit schooling, low pensionsw
When did Chiacgo boys enter chilean political sphere?
Most senior member, De Castro, advised to their economics minister in 1973.
The downsides of neoliberalisation:
Benefits of growing GDP mitigated by unemployment, inflation, and rise in inequality.
Example of sacrified made in neoliberal Chile:
1975 350% inflation compelled Pinochet to accept Milton Friedmans shock treatment to restablise prices at cost of increasing unemployment, continuing until mid 80’s.
Interest rates in Neoliberal Chile:
Allowed to rise, prompting banks to borrow money internationally, with resulting deficits caused financial institutions to bail out at taxpayers expense.
End of Pinochet Regime:
56% Chileans voted against continuing regime, with following governments NOT unconditionally embracing neoliberal regime.
