The return of conservative businessman Sebastian Pinera to the Chilean presidency in March 2018 is best understood as a necessary course correction in Chile's democratic development. The election of Pinera, who had been president from 2010 to 2014, was not the crushing rebuke of the left that his conservative backers had vainly hoped for or, as some might misconstrue it, a sharp turn to the political right. Pinera's coalition may still harbour a diminishing coterie of supporters of the late dictator Augusto Pinochet, but this election, the seventh consecutive national vote since the end of the dictatorship, proved - if proof was even needed - the strength and durability of Chilean democracy today.
The "centre-right" Pinera, whose allies comprise big and small business, professionals, conservative workers and farmers and the above-mentioned pinochetistas, faces a left-leaning majority in Congress which will influence the direction of his government for his current - and unrenewable - four-year term. This majority is composed not only of his traditional "centre-left" opponents (the Socialists, Party for Democracy, Christian Democrats, etc.), but also a new, more radically inclined left faction, Frente Amplio, or Broad Front, which arose from a variety of student and citizen activist groups over the last decade.
Better economic management with more social equality
Pinera's predecessor, Michelle Bachelet, championed an agenda that focused on combating Chile's still deep-seated economic inequality. Bachelet's opponents liked to characterize her hard-driving reform agenda as a bulldozer and wished to see a tough electoral repudiation. But today Bachelet's political legacy in some respects appears durable. In effect, Chilean voters chose a more businesslike chief executive to manage the country's ongoing social welfare agenda. The election can even be seen to counter trends elsewhere in the world. Rather than accentuating extremes, the election has produced a political alignment that balances improved economic management with a desire for more social equality.
From the end of the Pinochet dictatorship in 1990 to the beginning of Bachelet's second term in 2014 (she had been president from 2006 to 2010), Chile's economy grew an average of more than 5 per cent annually, and the numbers of those in poverty declined from 40 to approximately 8 per cent of the population. Chile has a growing middle class, but the gap between the richest segment of the population and its poorest, as reflected in the benchmark Gini coefficient, was still pronounced in 2014. Bachelet aimed to tackle what she and her supporters saw as longstanding inequity through education reform, tax restructuring and constitutional change.
None of this was going to be simple. The climate for introducing reforms was not helped by one of Bachelet's senior ministers who announced intemperately that Bachelet was going to take a retroexcavadora (the marvellously descriptive Spanish word for a backhoe) to the foundations of the post-Pinochet polity. Education reform raised the ire of the owners of the deeply entrenched Chilean private school system. Tax changes, which aimed to shift taxes to the owners of companies rather than the companies themselves, cast a chill over access to capital for corporate reinvestment. And constitutional reform consultations bogged down in paranoia that Bachelet's ulterior motive was to undermine property rights.
Complicating Bachelet's difficulties further was the end of the commodities supercycle that had held primary materials prices aloft after the 2008-09 recession, largely fuelled by the continuing economic growth of China. Copper comprises half of Chile's exports and, coinciding with Bachelet's election, its price dropped from nearly $4 to about $1.50 per pound. Chile's economic growth dropped accordingly, to well below 2 per cent annually.
The final deflation of Bachelet's popularity came with a series of scandals. Her son and daughter-in-law were implicated in a real estate speculation and influence-peddling scandal, and a widespread political fundraising scheme was exposed in which one of Chile's iconic companies, SQM...