Chile - Ibanez's Second Presidency, 1952 58

Ibáñez's second presidency, 1952-58

Like the Radicals before him, Ibáñez entered office as a reformer governing with a center-left coalition and ended his term as a conservative surrounded by rightists. Along the way, he discarded his promises of economic nationalism and social justice. Also like the Radicals, he left festering problems for subsequent administrations.

Early in his administration, Ibáñez tried to live up to his billing as a nationalistic reformer. He rewarded those who had voted for him in the countryside by setting a minimum wage for rural laborers, although real wages for farm workers continued to fall throughout the decade. He also postured as a Latin American spokesman, hailing Juan Domingo Perón when the Argentine leader visited Chile.

After two years of expansionary fiscal policies in league with reformers and a few leftists, Ibáñez converted to a conservative program to stem inflation and to improve relations with the United States copper companies. As the effort to move import-substitution industrialization beyond the stage of replacing foreign consumer goods bogged down, the economy became mired in stagflation. The rates of industrialization, investment, and growth all slowed. Monetarist policies proposed by a team of United States experts, known as the Klein-Saks Mission, failed to bring inflation under control. Price increases averaged 38 percent per year during the 1950s.

Persistent inflation stoked a debate among economists over causes and cures. Emphasizing deep-rooted causes and long-term solutions, advocates of structuralism blamed chronic inflation primarily on foreign trade dependency, insufficient local production (especially in agriculture), and political struggles over government spoils among entrenched vested interests. Their opponents, avocates of monetarism, attributed rising prices principally to classic financial causes such as currency expansion and deficit spending. Like the Klein-Saks Mission, the monetarists recommended austerity measures to curb inflation. The structuralists denounced such belt-tightening as recessionary, inimical to growth, and socially regressive. The monetarists replied that economic development would be delayed and distorted until expansionary monetary and financial policies were corrected.

Adopting a monetarist approach, in 1955 Ibáñez made concessions to the United States copper companies, chiefly Anaconda and Kennecott, in an effort to elicit more investment. These measure reduced the firms' taxes and raised their profits but failed to attract much capital. Discontent with this experience underlay subsequent campaigns to nationalize the mines.

Ibáñez also enacted reforms to increase the integrity of the electoral system. Under the new plan, the secret ballot system was improved in 1958, and stiff fines for fraud were established. These reforms reduced the sway of landowners and facilitated the growth of the Christian Democrat and Marxist political movements among peasants.

Ibáñez's middle- and working-class support flowed over to the Christian Democrats and the Marxists. The Christian Democratic Party (Partido Demócrata Cristiano--PDC) was founded in 1957 with the merger of three conservative elements: the National Falange, founded in 1938; the Social Christian Conservative Party; and the remnants of the Agrarian Labor Party that had backed Ibáñez. The Christian Democrats espoused reformist Catholic doctrines that promised a society based on communitarianism. The new party appealed strongly to the middle class, women, peasants, and ruralurban migrants. Its displacement of the Radicals as the preeminent centrist party meant that a pragmatic organization was replaced by an ideological group less amenable to coalition and compromise. At the same time that the center was hardening its position, the right and the left were also becoming more dogmatic and sectarian.

Relegalized by Ibáñez in 1958, the PCCh formed an enduring electoral alliance with the Socialists known as the Popular Action Front (Frente de Acción Popular--FRAP). The Marxist parties embraced more militant projects for the construction of socialism and disdained alliances behind centrist parties. They replaced Popular Front politics with "workers front" politics. The PCCh and the Socialist Party became more exclusive and radical in their ideological commitments and in their dedication to the proletariat. Of the two parties, the Socialist Party posed as more revolutionary, especially after the 1959 Cuban Revolution.

As they had in the 1930s, the Marxist parties experienced success in the 1950s in tandem with a unified national trade union movement. Dismayed by runaway inflation, the major labor unions replaced the fractionalized CTCh with the United Federation of Chilean Workers (Central Única de Trabajadores de Chile--CUTCh) in 1953. The Communists and Socialists, with their enduring strength in older unions in mining, construction, and manufacturing, took command of the new confederation.

As the 1958 election approached, the electorate divided into three camps well-defined by their predominant class and ideology. The right represented mainly Conservatives and Liberals, the upper class, rural dwellers, the defenders of capitalism, and the status quo. In the center, the Christian Democrats and Radicals spoke largely for the middle class and the proponents of moderate social reforms to avoid socialism. On the left, the Socialists and Communists championed the working class, advocating a peaceful transition to socialism. Rural-urban migrants and women had gained social and political importance. The percentage of the population registered to vote in presidential contests had risen from about 11 percent in the 1940s to 17.5 percent in 1952 and then to 21 percent in 1958. In the 1958 election, the right--Conservatives and Liberals--hoped to return to power for the first time since 1938. Their standard-bearer was Jorge Alessandri Rodríguez, an engineering professor and the son of Chile's most recent rightist president. He posed as an independent who was above party politics, offering technocratic solutions to the nation's problems. In the center, the Radicals, with candidate Luis Bossay Leyva, and the Christian Democrats, who nominated Eduardo Frei Montalva, vied for moderate votes. On the left, the reunited Socialists and Communists backed Salvador Allende.

In a preview of the 1970 election, the 1958 vote split three ways: 31 percent for Alessandri, 29 percent for Allende, and 40 percent for the rest, including a strong third-place showing by Frei with 21 percent. If it had not been for the 3 percent of the votes snared by a populist defrocked priest, the 15 percent won by the Radicals, and the low percentage (22 percent) of women casting ballots for Allende, the Marxists could easily have captured the presidency in 1958, several months before the Cuban Revolution. As it was, they and the Christian Democrats were highly encouraged to build their electoral forces toward another face-off in 1964. An especially noteworthy shift was the transfer of many peasant votes from the right to the columns of Christian Democrat and Marxist politicians promising agrarian reform.

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