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PASTOR GENERAL'S REPORT, August 1, 1980
Page 15
two more years Chile languished, paying the price for not only the catas
trophic Allende years with Marxist economics, including land expropriation,
but for the previous thirty years of creeping Socialism.
In April 1974, inflation soared to over 1000%. The year 1975, however,
was worst of all, when oil prices soared and the price of copper plummeted.
Then the Chicago Boys were given firm control by the military, who had
confidence in them. They took government spending into hand, stripped
away price controls, slashed tariffs, opened up the highly-protected,
over-staffed, feather-bedded economy, and encouraged outside investment.
For a while it was tough to adjust from a protected economy to an open
one. There still are some problems, the most notable one being unemploy
ment, which is running from about 12-15%. Nevertheless, Chile has enjoyed
about three years of solid, 8% growth beyond inflation, which is now down
to about 30%.
The government divested itself of all unprofitable state-run enterprises,
returning industry to private hands. It actually has increased the share
of money going into the social services. Therefore their reforms have not
been piled on the backs of the poor, though it is often pictured that way
by outsiders. Foreign capital is treated exactly the same as domestic
capital. The foreigner can repatriate his profits at any time. The power
of the labor unions here is firmly controlled. Crippling nation-wide,
industry-wide strikes are not permitted.
We had a chance to speak to one of the "Chicago Boys," Julio Bittborn.
He comes from an old family that settled in Chile about five generations
ago. Mr. Bittborn explained the seeming contradictions between a con
servative military government (political parties are temporarily sus
pended) and a free economy, perhaps the freest in the world today. The
government and the economists hope to so restructure the economy so as to
produce solid growth, spread economic benefits to all classes of the
people, and inculcate a new way of thinking--so much so that no vote
buying politician will, when civilian rule is returned, be able to revert
to the course of the past.
The problem in Chile has always revolved around the politicians. The
military in Chile has a long history of being subordinated to civilian
leadership. The generals and admirals in Chile in no way have resembled
the military in, say, Bolivia. However, in 1976, after the Chilean
Supreme Court had ruled Allende was ruling illegally (he even had de
veloped his own personal army) and rumors of a blood-letting by leftists
was rife, the military felt it simply had little option left but to step
in.
The good news for the Work of God in Chile is that, unlike Cuba, we can
still do a Work here, hopefully much more in the months ahead. Although
the Church in Chile is small, I'm positive that it will grow. We showed
copies of La PURA VERDAD and various of our booklets--especially public
service booklets--to the officials that we interviewed. All these
individuals seemed quite impressed.