Book review: The Chile Project: The Story of the Chicago Boys and the Downfall of Neoliberalism, Sebastian Edwards - Richard Feinberg (Foreign Affairs)

Seria preciso especificar que o neoliberalismo da ditadura chilena só interveio depois de uma primeira fase de políticas autoritárias e dirigistas pelo próprio general Pinochet, um monstro humano e um ignorante em economia.

The Chile Project: The Story of the Chicago Boys and the Downfall of Neoliberalism

By Sebastian Edwards

Princeton University Press, 2023, 376 pp.

Published on February 28, 2023

Reviewed by Richard Feinberg

Foreign Affairs, March/April 2023

At the height of the Cold War, the far-right economics department of the University of Chicago, with the support of the U.S. government, recruited students from then democratic Chile. When General Augusto Pinochet seized power in 1973, he hired these “Chicago boys” to apply their extreme free-market fundamentalism to the Chilean economy. Remarkably, the left-of-center democratic governments that succeeded Pinochet’s regime after 1990 maintained many of those market-friendly prescriptions. Edwards, a Chilean-born economist with a Ph.D. from the University of Chicago, narrates a fascinating insider intellectual history of the policies and personalities behind Chile’s economic development in recent decades. But he struggles to explain the unanticipated popular uprising in 2019 against this doctrinal “neoliberalism” with which he largely sympathizes. Although the economic model had generated strong growth, reduced extreme poverty, and expanded the middle class, Edwards now finds that many policymakers neglected stark, persistent inequalities; corporate collusion had eroded free-market competition; and public policy may have gone too far in interjecting market competition into education, health care, and retirement pensions. Looking forward, Edwards suggests that Chile may yet find a more sustainable middle road as a European-style social democracy, with less spectacular economic growth but greater social cohesion.

From Amazon.com: 

How Chile became home to the world’s most radical free-market experiment―and what its downfall suggests about the fate of neoliberalism around the globe

In The Chile Project, Sebastian Edwards tells the remarkable story of how the neoliberal economic model―installed in Chile during the Pinochet dictatorship and deepened during three decades of left-of-center governments―came to an end in 2021, when Gabriel Boric, a young former student activist, was elected president, vowing that “If Chile was the cradle of neoliberalism, it will also be its grave.” More than a story about one Latin American country, The Chile Project is a behind-the-scenes history of the spread and consequences of the free-market thinking that dominated economic policymaking around the world in the second half of the twentieth century―but is now on the retreat.

In 1955, the U.S. State Department launched the “Chile Project” to train Chilean economists at the University of Chicago, home of the libertarian Milton Friedman. After General Augusto Pinochet overthrew socialist president Salvador Allende in 1973, Chile’s “Chicago Boys” implemented the purest neoliberal model in the world for the next seventeen years, undertaking a sweeping package of privatization and deregulation, creating a modern capitalist economy, and sparking talk of a “Chilean miracle.” But under the veneer of success, a profound dissatisfaction with the vast inequalities caused by neoliberalism was growing. In 2019, protests erupted throughout the country, and in 2022 Boric began his presidency with a clear mandate: to end neoliberalismo.

In telling the fascinating story of the Chicago Boys and Chile’s free-market revolution, The Chile Project provides an important new perspective on the history of neoliberalism and its global decline today.