Is Coronavirus Strengthening Neoliberalism in Chile?

Ignoring WHO recommendations, the Chilean government has exploited the coronavirus pandemic to consolidate its neoliberal agenda while re-establishing internal control over the population.

Sooner or later the current global pandemic was going to hit Chile. The first case of COVID-19 was reported on 3 March 2020. According to the Chilean government, by 27 April there had been 13,813 confirmed cases and 198 deaths in the country. Chile has had the second-highest number of confirmed cases in Latin America and the Caribbean, after Brazil.

While many people had hoped the government would follow World Health Organisation guidelines to contain the spread of the virus, its response was to consolidate the neoliberal front. Facing a choice between public health and the economy, Chilean president Sebastián Piñera prioritised the latter. On 18 March, instead of imposing a national lockdown, he declared a state of emergency and the military – again – took to the country’s streets.

But Piñera also tried to position Chile as leading crisis management in Latin America, suggesting that the country would follow South Korea’s example in mitigating the crisis thanks to early preparation. Unfortunately for the president, experts have raised doubts over the government’s preparedness to ensure public safety, with the situation hardly helped by the flatlining approval ratings of both Piñera and the Minister of Health, Jaime Mañalich – who was expelled from the Order of Doctors in 2015. For instance, while Piñera described the lockdown as a ‘creative solution’, Mañalich’s declarations have been disputed by doctors, economists, and journalists, with the minister facing accusations of falsifying data and implementing a poor public health agenda.

During an interview with TVN Chile, Mañalich said that the quarantine is ‘total nonsense and highly unnecessary’ to prevent contagion. Mañalich is also behind the scandal around mechanical ventilators, having said that the Chinese government had donated 1,000 of them to Chile. This was refuted twice by the Chinese Ambassador, Xu Bu, who said he was unaware of any donation from his government. The Confederation of Industry and Trade (CPC) resolved the situation by buying 400 mechanical ventilators from China. Moreover, Mañalich has been accused of failing to share data with scientists, which has impeded their attempts to develop necessary responses.

Why did Piñera announce a curfew rather than a lockdown? While the former prohibits the freedom of movement between 10pm and 5am, the latter would isolate specific areas of the city to contain the contagion. Following a slowdown over the summer months of January and February, March saw a renewal of protests which had begun in October 2019. On 8 March – International Women’s Day – around three million women demonstrated across the country, while students also organised occupations of schools and universities. There were other protests over water privatisation, the pensions system (AFP), the right to dignified housing and, on 29 March, the annual Day of the Young Combatant (Día del joven combatiente), which calls for uprising to commemorate youthful militants killed by the Pinochet dictatorship.

This raises the question: has COVID-19 been beneficial for Piñera? Both the authoritarian response to the crisis and the neoliberal policies adopted by the president imply it has. While the national plebiscite on a constituent assembly – previously scheduled for 26 April – has been postponed to October 2020, business has continued as usual, with people still required to go to work. Additionally, although Piñera stated that the government has been preparing for the crisis since January, the healthcare sector made no relevant purchases, such as ventilators or medical masks, until March. To sectors of the business and political class, the virus is an opportunity to regain control by weakening workers’ rights and protecting profit.

‘We cannot kill the economy to save lives’ – Carlos Soublette, Chief Executive Officer of the Chamber of Commerce (CCS), 17 April 2020

‘Save the economy’ has been the mantra over the last month. While the Chief Executive Officer of the Chamber of Commerce stated that economic activity cannot be sacrificed to save lives – referring to the opening of malls in the middle of the pandemic – Piñera argued that ‘as people need oxygen to survive, business needs liquidity’. By allowing employers to decide whether staff had to keep going to their workplaces, the government abdicated responsibility and opened the doors to mass lay-offs, turning working relations even more coercive.

The crisis has starkly emphasised the two contrasting worker scenarios. There are those who can work from home – largely white-collar, middle-class jobs – and those who cannot, including the many people in informal employment or self-employment such as street vendors and domestic workers. In the absence of a formal lockdown, many workers are obliged to expose themselves to risk if they wish to retain their salary. Furthermore, less than 15 per cent of the 3.6 million people (in a population of around 17 million) that work without any social protection will receive a bonus of $50,000 Chilean pesos (approximately £48) from the government ‘as a sign of support’, as reported by CIPER.

Legislation to ensure workers pay for the crisis

On 24 March, the law to regulate teleworking was issued. This stipulates protection for those obliged to work from home, while promising ‘more freedom and opportunities’. While teleworkers are relatively comfortable in the Chilean context, the new law implicitly expands the working day without any additional remuneration. With no labour organisation having agreed to the law, there is little protection for teleworkers’ rights, yet they face stress and uncertainty while being expected to be available at least ten hours a day. For example, although the law establishes the ‘right to disconnect’ for 12 hours between shifts, it also allows for this period to be reduced if agreed between employer and employee. However, the relation power dynamic is almost always slanted towards the employer, making any agreement potentially subject to undue pressure.

Law 21.227 – known as the ‘Law for Employment Protection – was enacted on 6 April ‘to protect incomes and working relations when acts of authority – such as quarantines or the closure of companies – prevent workers from providing their services’. According to the law, workers will face a temporary suspension of their contract while receiving 70 per cent of their income over the previous three months from their unemployment insurance. Essentially, while employees will cover their own salary, employers will be able to relinquish their responsibility towards workers, who legally will not be fulfilling their contractual obligations. The law also allows for the working day to be reduced by up to 50 per cent, in which case workers will be paid proportionally to the time worked, which could reduce wages below the legal minimum.

Selective lockdowns and other controversial measures

Beyond the deterioration of working conditions and insufficient measures to provide social support to the population, the government implemented other controversial decisions to prevent mass contagions of COVID-19. By imposing lockdown only in Santiago’s wealthier districts, the government made clear that only certain people deserve protection from the pandemic. Poorer areas of the Metropolitan Region have been put under lockdown only when the government reported major outbreaks.

Chile’s inherent neoliberal character means many people simply cannot afford to live under quarantine. With no social protection, people have to choose between hunger or risking exposure to coronavirus in a context where their rights have already been eroded. While politicians and health professionals calling for universal lockdown measures have come under attack from the political Right, government priority has focused on the concerns of the private sector pushing for a ‘safe return to normality’. The president of the Order of Doctors, Izkia Siches, who is also a member of the leftwing Frente Amplio party, received death threats, while the mayor of the Santiago district of Recoleta, Daniel Jadue, has been accused of refusing to cooperate with the government and spreading disinformation.

Social organisations opposed the announcement by the Minister of Education, Raùl Figueroa, that schools would reopen on 27 April. Families and the Order of Professors argued that the safety of students and teachers could not be guaranteed. The government also pushed for public sector workers to return to work and shopping malls to reopen. This saw demonstrations organised on 27 and 28 April, with eyes on how the coronavirus will impact the massive protest movement engulfing the country.

Ignoring WHO recommendations, the Chilean government has exploited the coronavirus pandemic to consolidate its neoliberal agenda while re-establishing internal control over the population.

Sooner or later the current global pandemic was going to hit Chile. The first case of COVID-19 was reported on 3 March 2020. According to the Chilean government, by 27 April there had been 13,813 confirmed cases and 198 deaths in the country. Chile has had the second-highest number of confirmed cases in Latin America and the Caribbean, after Brazil.

While many people had hoped the government would follow World Health Organisation guidelines to contain the spread of the virus, its response was to consolidate the neoliberal front. Facing a choice between public health and the economy, Chilean president Sebastián Piñera prioritised the latter. On 18 March, instead of imposing a national lockdown, he declared a state of emergency and the military – again – took to the country’s streets.

But Piñera also tried to position Chile as leading crisis management in Latin America, suggesting that the country would follow South Korea’s example in mitigating the crisis thanks to early preparation. Unfortunately for the president, experts have raised doubts over the government’s preparedness to ensure public safety, with the situation hardly helped by the flatlining approval ratings of both Piñera and the Minister of Health, Jaime Mañalich – who was expelled from the Order of Doctors in 2015. For instance, while Piñera described the lockdown as a ‘creative solution’, Mañalich’s declarations have been disputed by doctors, economists, and journalists, with the minister facing accusations of falsifying data and implementing a poor public health agenda.

During an interview with TVN Chile, Mañalich said that the quarantine is ‘total nonsense and highly unnecessary’ to prevent contagion. Mañalich is also behind the scandal around mechanical ventilators, having said that the Chinese government had donated 1,000 of them to Chile. This was refuted twice by the Chinese Ambassador, Xu Bu, who said he was unaware of any donation from his government. The Confederation of Industry and Trade (CPC) resolved the situation by buying 400 mechanical ventilators from China. Moreover, Mañalich has been accused of failing to share data with scientists, which has impeded their attempts to develop necessary responses.

Why did Piñera announce a curfew rather than a lockdown? While the former prohibits the freedom of movement between 10pm and 5am, the latter would isolate specific areas of the city to contain the contagion. Following a slowdown over the summer months of January and February, March saw a renewal of protests which had begun in October 2019. On 8 March – International Women’s Day – around three million women demonstrated across the country, while students also organised occupations of schools and universities. There were other protests over water privatisation, the pensions system (AFP), the right to dignified housing and, on 29 March, the annual Day of the Young Combatant (Día del joven combatiente), which calls for uprising to commemorate youthful militants killed by the Pinochet dictatorship.

This raises the question: has COVID-19 been beneficial for Piñera? Both the authoritarian response to the crisis and the neoliberal policies adopted by the president imply it has. While the national plebiscite on a constituent assembly – previously scheduled for 26 April – has been postponed to October 2020, business has continued as usual, with people still required to go to work. Additionally, although Piñera stated that the government has been preparing for the crisis since January, the healthcare sector made no relevant purchases, such as ventilators or medical masks, until March. To sectors of the business and political class, the virus is an opportunity to regain control by weakening workers’ rights and protecting profit.

‘We cannot kill the economy to save lives’ – Carlos Soublette, Chief Executive Officer of the Chamber of Commerce (CCS), 17 April 2020

‘Save the economy’ has been the mantra over the last month. While the Chief Executive Officer of the Chamber of Commerce stated that economic activity cannot be sacrificed to save lives – referring to the opening of malls in the middle of the pandemic – Piñera argued that ‘as people need oxygen to survive, business needs liquidity’. By allowing employers to decide whether staff had to keep going to their workplaces, the government abdicated responsibility and opened the doors to mass lay-offs, turning working relations even more coercive.

The crisis has starkly emphasised the two contrasting worker scenarios. There are those who can work from home – largely white-collar, middle-class jobs – and those who cannot, including the many people in informal employment or self-employment such as street vendors and domestic workers. In the absence of a formal lockdown, many workers are obliged to expose themselves to risk if they wish to retain their salary. Furthermore, less than 15 per cent of the 3.6 million people (in a population of around 17 million) that work without any social protection will receive a bonus of $50,000 Chilean pesos (approximately £48) from the government ‘as a sign of support’, as reported by CIPER.

Legislation to ensure workers pay for the crisis

On 24 March, the law to regulate teleworking was issued. This stipulates protection for those obliged to work from home, while promising ‘more freedom and opportunities’. While teleworkers are relatively comfortable in the Chilean context, the new law implicitly expands the working day without any additional remuneration. With no labour organisation having agreed to the law, there is little protection for teleworkers’ rights, yet they face stress and uncertainty while being expected to be available at least ten hours a day. For example, although the law establishes the ‘right to disconnect’ for 12 hours between shifts, it also allows for this period to be reduced if agreed between employer and employee. However, the relation power dynamic is almost always slanted towards the employer, making any agreement potentially subject to undue pressure.

Law 21.227 – known as the ‘Law for Employment Protection – was enacted on 6 April ‘to protect incomes and working relations when acts of authority – such as quarantines or the closure of companies – prevent workers from providing their services’. According to the law, workers will face a temporary suspension of their contract while receiving 70 per cent of their income over the previous three months from their unemployment insurance. Essentially, while employees will cover their own salary, employers will be able to relinquish their responsibility towards workers, who legally will not be fulfilling their contractual obligations. The law also allows for the working day to be reduced by up to 50 per cent, in which case workers will be paid proportionally to the time worked, which could reduce wages below the legal minimum.

Selective lockdowns and other controversial measures

Beyond the deterioration of working conditions and insufficient measures to provide social support to the population, the government implemented other controversial decisions to prevent mass contagions of COVID-19. By imposing lockdown only in Santiago’s wealthier districts, the government made clear that only certain people deserve protection from the pandemic. Poorer areas of the Metropolitan Region have been put under lockdown only when the government reported major outbreaks.

Chile’s inherent neoliberal character means many people simply cannot afford to live under quarantine. With no social protection, people have to choose between hunger or risking exposure to coronavirus in a context where their rights have already been eroded. While politicians and health professionals calling for universal lockdown measures have come under attack from the political Right, government priority has focused on the concerns of the private sector pushing for a ‘safe return to normality’. The president of the Order of Doctors, Izkia Siches, who is also a member of the leftwing Frente Amplio party, received death threats, while the mayor of the Santiago district of Recoleta, Daniel Jadue, has been accused of refusing to cooperate with the government and spreading disinformation.

Social organisations opposed the announcement by the Minister of Education, Raùl Figueroa, that schools would reopen on 27 April. Families and the Order of Professors argued that the safety of students and teachers could not be guaranteed. The government also pushed for public sector workers to return to work and shopping malls to reopen. This saw demonstrations organised on 27 and 28 April, with eyes on how the coronavirus will impact the massive protest movement engulfing the country.

2020-05-29T23:03:15+00:00 1/May/2020|Categories: Articles|Tags: , , , |
Marcella Via is an Alborada contributing editor and independent journalist interested in issues related to human rights and Latin American politics. Twitter:@IntiMar21

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