Chile: lessons of the coup

Pin It
FRFI 144 August / September 1998

1973-1998

25 years ago, on 11 September 1973, a military coup deposed the democratically-elected government of Salvador Allende in Chile. In the ensuing blood bath, thousands of communists, socialists, workers and peasants were murdered, Allende amongst them. The national stadium in the capital, Santiago, was turned into a concentration camp, where hundreds were tortured and shot whilst the ruling class celebrated with champagne parties.

In the following years, the country was ruled by military terror. Torture and disappearances were routine. Political parties and trade unions were banned. Real wages were slashed so that by 1987 average daily food consumption had fallen from its 1973 level of 2,692 calories to just 2,227. By 1996, when the poorest 50% of the population received just 17.3% of national income, the richest 10% got 41.6% or $4,000 per month. The middle class - 30% of the population - earned about $1,000 per month, enough to buy the private health and education that the mass of the working class could never afford.

Today politicians such as the British Labour government's Minister for Welfare Reform Frank Field, flock to Chile to study its privatised welfare system; he now extols the virtues of their privatised pension scheme. ROBERT CLOUGH examines the lessons of the coup.

A facade of democracy has been restored. General Pinochet, the leader of the 1973 coup, finally retired as head of the armed forces in March of this year; he is now a senator for life, with legal immunity from any prosecution for the terror for which he was responsible. His regime was a vital ally of British imperialism; it provided covert bases for the SAS during the Malvinas war, and it has been an important destination for British arms sales.

The rise of Unidad Popular

All this is a far cry from the situation in 1970 when Salvador Allende was elected President as a self-proclaimed Marxist on a programme which called for the nationalisation of foreign industry and the introduction of socialism. To understand how this was possible, and how it ended in bloody failure, it is important to understand the evolution of capitalism in Chile, its dependency on imperialism, and how this moulded the political character of the parties which led its working class.

In the late nineteenth century, Chile became British imperialism's source of nitrates for fertiliser and explosives. The British-owned nitrate mines in the north of the country employed up to 100,000 workers; when 10,000 of them struck in Iquique in 1907, troops machine-gunned a mass meeting, massacring over 2,000 men, women and children. Between 1904 and 1914, US companies took control of the Chilean copper industry. Kennecott took over El Teniente, the world's largest underground copper mine, and Anaconda, the world's largest open-cast copper mine, Chuquicamata. US investment rose from $5m in 1895 to $200m in 1914. Chile became the world's second-largest producer of copper, its economy completely dependent on the world market for copper, iron and nitrates. By 1929, annual Chilean tribute to the US in the form of repatriated profits on direct investment and servicing of bank loans came to $100m; in 1940 US direct investment totalled $592m, second only to pre-revolutionary Cuba in Latin America.

Chile: a neo-colony

In the post-war period, Chile become little more than a neo-colony of US imperialism. In 1964, the US accounted for $1bn out of $1.2bn foreign direct investment. Such investment was fabulously profitable for the US companies involved. Between 1913 and 1963, Kennecott and Anaconda exported $4.1bn profits. In 1969, Anaconda made profits world-wide of $99m on investments of $1,116m: in Chile, it had made $79m of those profits on an investment of only $199m. In the six years between 1964 and 1970 Anaconda made $426m profits, and Kennecott $178m from Chilean copper. By the end of 1970, US domination was almost total. ITT ran the national telecommunications system through a 50-year concession granted in 1930. US companies controlled 50% of Chilean manufacturing, 60% of the iron, steel and chemical industries, and nearly 100% of engine assembly, radio and TV, pharmaceuticals, and of course copper.

The result was economic stagnation, and deteriorating conditions for the Chilean working class. In 1956, one hour's labour was sufficient to buy a kilo of green vegetables, or a litre of milk. By 1965 this had risen to two hours, and 1969, three hours. In 1965, a married Chilean worker with an 8-year-old child had to spend 66.8% of his earnings on food; by 1969, this had risen to 82.3%. Agriculture was extremely inefficient as a consequence of the pattern of ownership. In 1965, there were 730 estates of more than 5,000 hectares; these accounted for 16,795,000 out of the total of 30,648,000 hectares available for cultivation - more than 50%. On the other end of the scale, 123,696 holdings of less than 5 hectares totalled only 207,000 hectares. The great landowners were only interested in getting an income sufficient to support their parasitic lifestyle. Consequently 60 per cent of their estates were left uncultivated, and the rest was poorly mechanised. It was sufficient that they had access to a plentiful supply of cheap labour from the landless rural proletariat, which lived in desperate poverty.

The Chilean crisis in 1970

By 1970, Chile had become the second most indebted country per capita in the world (after Israel), owing $3.8bn, most of it to US banks. Successive governments had borrowed ever more extensively to pay for the lifestyle of the middle class, a quarter of the Chilean population; the dependent ruling class needed their support against the rising threat from the working class. In 1958, a coalition of Communists and Socialists had narrowly lost the presidential election, polling 356,000 votes against the 389,000 of the conservative winner. Fearful of another Cuba, the CIA pumped $20m into the 1964 election campaign of the Christian Democrat Eduardo Frei. He won by a substantial margin, but only with radical promises of land reform and partial nationalisation of the copper mines.

His government was a fiasco. Having promised to give land to 100,000 out of 350,000 peasant families by 1970, it met only 15% of its target in the face of landowner resistance. The 'Chileanisation' of the copper mines made no impact on production, and whilst the government underwrote mining debts of $632m, the companies exported profits to the tune of nearly $620m. Lastly, the economy continued to stagnate: between 1967-70 it grew by only 1%. Such conditions fanned discontent. Illegal occupations of farms and urban areas soared from 24 in 1968 to nearly 600 in 1970.

The number of strikes quadrupled to 1,000 a year, most of them illegal. The response was repression: seven protesters were shot dead in Santiago in 1967; in 1969, riot police evicted 100 peasant families squatting land near Puerto Montt in the south, killing nine people in the process.

CIA intervention

This was the context of the 1970 election. Once more, the CIA pumped millions of dollars into the Christian Democrat campaign, buying advertising space in the media, paying bribes to those whose votes could be bought, and funding an anti-Communist press campaign led by El Mercurio, the Chilean equivalent of The Times. Despite this, Salvador Allende, as candidate of Unidad Popular, a coalition of Communists, Socialists and Radicals, won the most votes, 1,070,000 or 36.2% of the total, with the conservative Nationalists getting 1,031,000 and the Christian Democrats 822,000.

The result created a crisis. The Unidad Popular programme - for nationalisation, welfare and accelerated land reform - represented a serious threat to US interests. However, the Christian Democrat-dominated Congress would have to confirm Allende's victory since he had not won an overall majority. Following the 4 September election, US imperialism went into overdrive to prevent his ratification. The Committee of 40, chaired by Henry Kissinger, and responsible for all covert US actions throughout the world, met to consider the possibility of financing a coup. President Nixon told the Director of the CIA to 'make the [Chilean] economy scream'. The CIA offered unlimited bribes to Christian Democrat congressmen to oppose Allende. The US ambassador to Chile warned that 'not a nut or bolt will be allowed to reach Chile under Allende....Once Allende comes to power, we shall do all within our power to condemn Chile and the Chileans to utmost deprivation and poverty...' ITT offered the CIA a 'seven figure sum' to finance the conspiracy; company Vice President William Meeriman wrote on 9 October 'approaches continue to be made to select members of the armed forces in an attempt to have them lead some sort of uprising - no success to date'.

Given the choice between Allende and the National Party candidate Alessandri, Frei and the Christian Democrats knew they would have to support the former if there was to be any chance of containing the unrest of the working class and peasantry. However, they insisted that Allende and Unidad Popular give a number of guarantees which would severely limit their scope of action. These included agreement to maintain the existing judicial and political system, ensure the continued independence and existing size of the armed forces, and prevent state interference in the freedom of the press. A bombing campaign by CIA-financed fascists failed to make the military move; army commander-in-chief General Schneider made it clear that he would support Allende if Congress confirmed his election. When fascists ambushed and murdered Schneider on 22 October, public outrage made Congress's endorsement of Allende two days later inevitable.

Unidad Popular: the first two years

Unidad Popular came to office committed to an extensive programme of industrial, agrarian and social reform. It nationalised mining and metallurgical industries, along with the largest monopolies in the textile, electronics, chemical and brewing industries, and 16 commercial banks. Real wages increased substantially. Universal primary schooling became a reality; the number of children going to secondary school rose 18% annually; those going on to high school rose by nearly 35%. There was free school milk for children under 15, and important gains for women: apart from equal pay, all workplaces with 20 or more employees were obliged to set up nurseries, and women were entitled to a year's maternity leave with full pay. Land redistribution, having stalled under Frei, was greatly accelerated leading to the formation of hundreds of co-operatives.

The rise in real wages stimulated a boom: GDP rose 8.5% in the first year, and unemployment fell from 7.2% in 1970 to 3.9% a year later. However, Unidad Popular's nationalisation of the copper industry became the excuse for a US financial and trade boycott which soon had a dramatic effect on the Chilean economy. With the agreement of the Christian Democrats, Unidad Popular had refused to pay compensation to Kennecott and Anaconda because of the excessive profits these companies had made between 1955 and 1970. The US embargo on spare parts meant that by 1972, a third of all state-owned buses were immobilised, as were a third of the specialised lorries in the Chuquicamata mine. Lines of credit from US banks were cut from $200m to $30m. As increasing wages fuelled demand for imported consumer goods, so the balance of payments went into the red. This was compounded both by a fall in the price of copper - from 66 US cents per pound in 1970 to 48 cents in 1972, at a cost of $500m to the economy - and by the need to increase food imports as a result of both agricultural dislocation and increased demand. Foodstuff imports rose from $165m in 1970 to $383m in 1972 and eventually $619m in 1973. The US credit squeeze meant that by 1973, the Chilean economy was insolvent.

Although the Chilean ruling class had managed to hamstring Unidad Popular through the constitutional guarantees, it realised that this was not sufficient to restrain the working class and peasantry. Hence, in collaboration with the US, which provided $40m through the CIA, it waged a campaign of economic and political destabilisation so as to recruit the middle class to its side. Meanwhile, the US stepped up military aid; after South Vietnam, the Chilean military became the second largest per capita recipient of such assistance.

In the face of this offensive, Unidad Popular started to retreat. The principle members of the alliance were the Socialist Party and the Communist Party. The Communist Party drew its strength from its base in the trade union movement and amongst sections of the privileged working class both manual and white collar. Throughout the period 1970-72 many of its members were drawn into state administration, whether it was to supervise land reforms or to lead the distribution committees which sought to control prices and distribution of consumer goods. The Socialist Party was split between a section closely tied to the Communist Party and a more radical wing which was supported by other smaller sections of Unidad Popular such as MAPU (Movement for United Popular Action) and the Christian Left.

The Communist Party was very much on the right wing of Unidad Popular; it had argued for the inclusion of the Christian Democrats within the alliance, and when that was defeated, had pushed for the acceptance of the constitutional guarantees which were the pre-condition for Christian Democrat ratification of Allende's presidency. It argued that Unidad Popular could only survive if it managed to recruit the substantial Chilean middle class to its side - farmers, small capitalists, white collar workers and professionals. Hence it opposed moves which might threaten the interests of these privileged layers. Until 1970, their standard of living had depended on foreign loans, credit and delayed payments rather than an expanding productive system. In the short term, Unidad Popular had no choice but to continue this arrangement to buy the middle class support it craved as a counter-balance to the pressures from the oppressed. Cynics spoke of a 'transaction to socialism' as Unidad Popular sought to finance the privileged consumption of the middle class; Fidel Castro, who visited Chile in autumn 1971, expressed concern about 'a revolution of consumption, not investment'.

The class struggle intensifies

Yet as production slowed down from 1972 and inflation accelerated, events were to show that it was not possible to satisfy the interests of the working class and poor peasantry and at the same time sustain the privileges of the upper working class and middle class. Shortages of consumer goods, both real and artificial, created a black market whose inflated prices excluded the working class. In response, the government set up Juntas de Abastecemientos Popular (JAPs) to control the distribution of essential commodities. These often acquired a popular character as they policed distribution in working class areas, opposing shopkeepers and other retailers who looked to make money on the black market. More fundamentally, in ensuring that the working class got more, they also ensured the middle class got less, and so became a particular target of ruling class hostility.

In the countryside, expropriation and redistribution of land still faced resistance from the rich landowners, who funded local militias to terrorise the poor peasants and landless workers. And although the reforms were aimed at estates of 80 hectares and above, it was the owners of smaller estates - 40 to 80 hectares - who often proved the most ruthless exploiters and implacable enemies of the poor. In 1971, there were 1,758 rural strikes and 1,272 land seizures; over half of the latter involved farms of less than 80 hectares. There could be no reconciliation between the landless workers and the middle farmers, and Communist Party appeals to stop the occupations and strikes fell on deaf ears.

In October 1972, the ruling class felt confident enough to organise a nationwide lock-out. The spark for this was a protest by 50,000 lorry owner/drivers at shortages of spare parts. Factories were closed down by their owners; lawyers, doctors, nurses and teachers came out in support of the ruling class. The response of the working class was immediate: it took over factories and organised production on its own account. Militias were set up to police working class areas against fascist attacks, and to defend truck owners willing to break the ruling class blockade. Cordones industriales - literally industrial belts - which organised factory committees on an area basis - spread throughout Santiago and the major cities. Commandos communales joined together factory workers, neighbourhood assemblies, women's organisations and slum-dwellers also on an area basis.

Allende and his government were caught between the working class and oppressed on the one hand, and the ruling class on the other. In November, at the demand of the Christian Democrats, military leaders were taken into the cabinet as a guarantee that congressional elections would take place in March 1973. Unidad Popular promised the lorry-owners that their fleets would not face nationalisation. The Communist Party urged a slowing down of the pace of reform in order not to alienate the middle class. It was also concerned that grass-roots organisations such as the cordones industriales would undermine the control of the working class it exercised through the trade union movement. The Communist Party Minister of Economics urged the return of all occupied factories to their owners, only to back down when the working class refused to comply.

The period had also seen new forces come on to the political scene - the majority of the working class who were outside of the trade union movement, vast numbers of whom lived in the shanty towns around Santiago. By and large ignored by the Communist Party and Socialist Party, who concentrated on better-organised and more privileged layers of the working class, these layers began to provide political support to organisations on the left of Unidad Popular such as MAPU and the Movement of the Revolutionary Left (MIR). Whilst electorally they supported Unidad Popular alongside the rest of the working class, in their actions they were forced to go beyond what Unidad Popular found acceptable, thereby accentuating the political crisis it faced.

The coup is prepared

The ruling class went into the March 1973 elections confident that it would gain the two-thirds majority in Congress it needed to evict Allende and his government. The result confounded their expectations: Unidad Popular increased its share of the vote to 44%. General Prats, the army commander, pronounced himself satisfied with the outcome and left the cabinet. The ruling class and its US backers were in turmoil. There was no choice now but to increase the campaign of terror and sabotage as preparation for a coup.

June 1973 saw yet another ruling class lockout; instigated by the truckowners, it extended to sections of the most affluent miners in the El Teniente mines. Bombings, shootings and terror became the norm. A breakaway union of truck owners which supported Unidad Popular and attempted to break the strike came in for special treatment: fascists assassinated its president. Committees of workers and peasants came together to break the ruling class blockade. In the period 17-24 June there were 77 bomb attacks. General Prats was attacked publicly for his refusal to intervene; on 29 June a section of the army in alliance with the fascist Patria y Libertad organised a coup which was speedily defeated.

This was a signal to the ruling class to redouble its campaign: it was now terrified that unless it moved quickly, it stood to lose everything as workers and peasants were forced in practice to ignore the calls for restraint that came from Unidad Popular and its allies. There were also alarming signs of disaffection within the rank and file of the armed forces. In August, Luis Corvalan, Communist Party General Secretary, denied that working class actions were a threat to the army: 'They are claiming that we have a policy of replacing the professional army. No sir! We continue and will continue to support keeping our armed institutions strictly professional.' At the same time as he was saying this, 43 sailors were arrested in Valparaiso for disclosing preparations for a coup; Allende denounced them as 'ultra-left' and stooges of the MIR. El Mercurio called for an 'Indonesian solution' referring to Suharto's massacre of 500,000 Indonesian communists, peasants and workers seven years earlier in 1966. 'Djakarta' became a slogan of the right, painted on Santiago walls; General Prats resigned as middle class women demonstrated outside his home. Allende appointed General Pinochet in his place. The army started searches of factories, housing estates and slums up and down the country allegedly looking for arms. Socialists and activists were arrested and tortured; some were murdered.

On 4 September 1973, up to a million people marched through the streets of Santiago in support of Unidad Popular on the third anniversary of its election. The mood was sombre and subdued: the participants were aware of an impending coup, but had been given no lead from Unidad Popular. On the night of 10 September, the Chilean navy put to sea from Valparaiso for manoeuvres with US warships; by the time the ships returned early the following morning, hundreds of sailors identified as UP supporters had been murdered, many thrown overboard. At 11am, British-supplied Hawker Hunter jets swooped over Santiago and bombed La Moneda. Within hours, Allende was dead; he and his bodyguard had held off tanks and fully-armed troops for more than three hours. Elsewhere, pockets of workers with a few small weapons managed to resist for up to three days. By that time, thousands were already dead; it remained for the US to offer its support to the new regime which could not have succeeded without the financial and military aid that it had provided.

Conclusion

Unidad Popular failed because the main parties in the coalition had no confidence in the ability of the working class to organise and run society in its own interests. It therefore sought to adjust its policies to the prejudices of the middle class, and constantly courted middle class respectability. But the middle class cannot provide any solution to the problems of capitalist society - it will only follow the lead of the more powerful of the two contending classes - the capitalists or the working class. Hence in practice, Unidad Popular found itself paralysed - unable to confront the ruling class, and yet terrified of the revolutionary drive of the working class and oppressed. It tried to hold the balance between the two, which in practice meant holding back the working class and giving space to the ruling class to prepare its onslaught. Although both the Communist and Socialist Parties were mainly working class in composition, their leaderships drew their politics from a more privileged layer altogether. The lesson is that leadership of the working class has to be of the working class, not only socially but also politically.