Chile political system.docx - Chile Political System Chile...

Chile Political System
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Chile Political and Economic System
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Chile Political System
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Chile Political and Economic System
The nation of Chile, just slightly larger than the state of Texas, achieved independence
from Spain in 1818. Until 1830, the young nation was in a state of chaos when Diego Portales
escorted it in the period of the autocratic republic. This period, from 1830-1861, was a time of
firm-handed rule tempered by moderation. Traditional landowners and merchants were in control
of a centralized government, and the constitution of 1833 endured until 1925. The Conservatives,
though challenged by a strengthening liberal movement begun in the 1840’s, managed to
maintain control until 1873.
The Liberals, allied with the Radicals, assumed control from the Conservatives and the
period from 1875-1885 witnessed considerable modification of the national political institutions.
The church lost many privileges, including power over education, suffrage was extended, and
ministers were made responsible to Congress.
During this, Chile’s early nationhood, political change was constitutionally driven and
peaceful, and the resulting stability allowed for a steady economic development. Strong political
organization was the deciding factor in Chile’s defeat of Bolivia and Peru in the War of the
Pacific and subsequent conquest over the indigent Indians in the far reaches of its territory. The
war yielded a bounty of an expansion of the northern borders; lands which are rich in nitrate and
copper deposits. Chile’s economy was reliant on primary exports of which wheat, copper, and
sodium nitrate dominated. The resources from the new lands added to the already strong mining
industry to make Chile’s sodium nitrate deposits the largest in the world (Encyclopedia
Americana, 2002).
Following civil war in 1886, a parliamentary style government moved toward an
unregulated market economy, which prevailed until 1925. Marred by problems of violent labor

Chile Political System
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strikes, the country experienced a rural-to-urban population shift; labor exploitation prospered.
Urban industrial expansion followed the new labor force and was geared to providing finished
products for the consumer market (Pike, 2002).
Under a new Constitution adopted in 1925, presidential rule was reestablished and the
separation of church and state was imposed. New social justice codes were also established.
From 1927 until 1929 (the year of the world depression), Chile flourished economically with the
generous foreign investment of the United States and other foreign capital, as well as, its near
monopolistic production of sodium nitrate. Then disaster struck.
Chile fell into the great world depression of the early thirties while simultaneously, newly
developed synthetics drastically reduced world demand for sodium nitrate. Ironically, in 1931,
then President Ibanez resigned and a brief period of political instability followed, coinciding with
the depression. Exports dropped by 85% and imports by 80% between 1929 and 1932 (Loveman,