Tuesday, 29 November 2011

More on the cracks in the "Chilean economic miracle"

By Carlos Fortin

In my previous blog post I reported on an impressionistic assessment of the extent to which Chilean society is experiencing a deep malaise about the prevailing social, political and economic model.

The LatinobarĂ³metro Opinion Survey 2011 released on October 28 provides quantitative evidence for the assessment. The survey examines the attitudes of Chileans to public policies as well as a number of social, economic and political variables, and compares the 2011 responses to those in 2010 - it does not make for comfortable reading.

The worst rated public policy is education:
  • When asked ‘What is the best public policy in your country?’, only 1% of respondents mentioned education;
  • 9% of respondents  answered ‘education’ in response to the multiple-choice question, ‘Which of the following public policies has benefited you and your family’a question not asked in 2010).
This is not surprising given that the present wave of protest is precisely about the poor quality, high cost and unequal nature of education. The dissatisfaction, is however, much more general:
  • Less than one third of Chileans replied that they were satisfied with democracy, a drop of 24 percent from 2010.
  • Similarly 34% of respondents said they trust government, a decrease from 58% in 2010.
As for the operation of the economic model, the survey reveals serious doubts about some crucial components:
  • Only 20% of those asked felt privatisation of state companies has been beneficial for the country (34% in 2010);
  • Those satisfied with the performance of privatised public services dropped from 27% (2010) to 18% in 2011;
  • 16% considered the current economic situation in the country to be  ‘good’ or ‘rather good’ (27% in 2010);
  • Although 30% felt that their personal economic prospects for the following 12 months were ‘better’ or ‘somewhat better’, this is substantial fall from the 48% in 2010;
  • Although a majority (63%) of Chileans still believe that private enterprise is indispensable for the development of the country, the proportion has fallen from 76 % in 2010; and
  • For the first time since 1998 less than half (43%) of respondents agree that ‘the market economy is the only system that can make Chile into a developed country’ (56% in 2010).
More ominous was the response to the question, ‘Would you say that the country is governed by a few powerful groups in their own benefit, or is governed for the good of all the people?’
  •  Only 22% of Chileans believe the country is governed for the good of the people, as against 34% in 2010.
This is no doubt linked to the perception that the society is highly unequal: to the question ‘How fair do you think income distribution is in the country?’, only 6%  thought it was ‘very fair’ or ‘fair’; the corresponding percentage in 2010 was 12%.

Chile seems therefore in for a rather difficult period of political, social and economic soul searching, and it is unclear whether the present political structures can provide an adequate framework for the exercise.


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