After 9/11, Bush famously asked “Why do they hate us?” The answers might have been found on another 9/11, 28 years before, when the U.S. in Chile took a decisive step down the road to empire.
NEW YORK — Of apartheid South Africa’s myriad atrocities, one of the most medieval was a system in which white settlers plied their farmworkers with alcohol in lieu of wages. Known by the Afrikaans word for tot, or drink, the dop not only kept workers docile — and wages low — but, in fostering widespread and chronic dependency, the practice bordered on enslavement, manacling workers to their addictions and hence their oppression.
A progressive white South African lawyer told me that shortly after voters of all races went to the polls to repeal apartheid in 1994, he managed to purchase a Cape Town vineyard as part of his lifelong ambition to create award-winning wines. His first order of business was to professionalize the operations; so, soon after he closed the deal to buy the vineyard, he gathered up all 15 farmworkers and announced that he would end the dop and pay their wages, in full.
Seven walked off in disgust, he said.
This story is the perfect metaphor for America in the aftermath of the terrorist attack that occurred 17 years ago today. An entire nation stared into the abyss on 9-11 and, like a sloppy drunk waking up in a pool of his own vomit, saw its image reflected in the wreckage as though for the first time. But rather than facing our demons, owning our failures, and acknowledging the outsized role we’ve played in the suffering of others, we simply sidled up to the bar for another drink. Like the inebriates who walked off a South African farm, ours is an Empire in denial and poor health, doubling down on our most self-destructive impulses, stumbling towards an inevitable, ugly end.
In an interview months after 9-11, Osama bin Laden warned:
The U.S. government will lead the American people — and the West in general — into an unbearable hell and a choking life.”
A 9/11 less remembered
Ironically, if we could pinpoint the date that United States took its first drink it would almost certainly be September 11, 1973, as General Augusto Pinochet’s troops stormed Chile’s presidential palace. Organized by Henry Kissinger and the CIA, the coup targeted Chile’s popular socialist President Salvador Allende, who the Nixon administration feared was another Fidel Castro in-the-making. As the attack unfolded, workers in the basement of a Santiago publishing house shop were hard at work printing what was to be the military junta’s 500-page economic plan.
Believing himself to be a messianic figure, Pinochet put his faith in a coterie of young Chilean advisers who had trained under Milton Friedman at the University of Chicago’s School of Economics, the academic vanguard of neo-classical economics. With his bloody crackdown on dissidents, artists, college students and union leaders, Pinochet’s repressive regime censored the press, banned labor unions and political opposition parties, murdered an estimated 5,000 leftists, tortured another 30,000 and handed the “Chicago Boys” – as they came to be known – a blank check to remake Allende’s nationalized economy, and return the country at South America’s southwestern edge into the Empire’s orbit.
Nearly 15 years before economists coined the phrase “Washington consensus,” and a decade before Reagan’s trickle-down policies began dismantling the New Deal in the U.S., Chile was the guinea pig for anti-Keynesian macroeconomic policies designed to fatten corporations’ share of global wealth. Pinochet slashed duties on imports, from an average tariff rate of 94 percent in 1973 to 10 percent by 1979. He privatized all but two dozen of Chile’s 300 state-owned banks, as well as utilities and entitlements such as social security. By 1979, he had cut public spending almost in half and public investment by nearly 14 percent. He lowered taxes, restricted union activities and returned more than a third of the land seized under Allende’s land-reform program.
Monetary policy was liberalized on two important fronts. First, Pinochet allowed “hot money” — speculation on the currency market — to flow in and out of the country without obstacle. And in 1979 he fixed the exchange rate for Chile’s peso, requiring the central bank to keep $1 in reserve for every 39 pesos printed. This kept the bank from merely printing money to pay bills and curbed an inflation rate that had soared to nearly 400 percent annually under Allende.
Pinochet’s reforms worked like a fast-acting virus. A recession in 1975 caused Chile’s economy to shrink by 13 percent, its greatest decline since the Great Depression. The recovery that followed was fueled largely by foreign cash, which poured into the country as investors gobbled up utilities and stashed money in Chile’s currency markets. The prices of imports fell sharply; between 1975 and 1982 the number of foreign cars sold in Chile tripled. Domestic manufacturing shriveled by 30 percent. Domestic savings plummeted. Wages fell, and the income gap between rich and poor widened by a factor of 50.
By 1982, Chile had accumulated $16 billion in foreign debt — nearly $42 billion in today’s dollars — and foreign investment represented a quarter of the country’s gross domestic product. The money flowing into the country flowed out just as easily, to pay debts and bills for imported goods and through capital flight as investors soured on Chile’s currency market. The economy had overheated and was now in a meltdown.
With a third of the workforce unemployed and unrest growing, by 1984 Pinochet began to “reform the reforms,” the Chilean economist Ricardo Ffrench-Davis said in a 2003 interview.
Pinochet allowed the peso to float and reinstated restrictions on the movement of capital in and out of the country. He introduced banking legislation, and ratcheted up spending on research and development efforts through quasi-governmental institutions and other collaborations between the public and private sectors — creating, as one example, the billion-dollar salmon farming industry out of whole cloth.
Still, Chile’s economic woes persisted. By 1989, real wages had declined by 40 percent from 1973, and the percentage of the population living in poverty had doubled to 40 percent. The number of Chileans without adequate housing had also climbed to 40 percent, up 13 percentage points from Allende’s final year in office. The country’s poor consumed 1,629 calories per-day-on average, compared to 2,019 in 1973.
Ill-fed, and ill-housed, Chileans began to refer to the cadre of advisers not as the Chicago Boys but as Si, Cago; Voy — which translates to “Yes, I shit; I go.”
A plebiscite in 1989 ended Pinochet’s rule and Chileans gradually began to reorganize their economy. Since 1990, it has consistently been Latin America’s strongest performer. But in its violent, fascist crackdown on the left and its fealty to Wall Street bankers, Chile under Pinochet presaged the entirety of the United States’ global class war against workers — in Argentina and Zambia; Flint and Venezuela; Philadelphia to Greece; Haiti, Iraq, Ukraine, Honduras; Russia in its post-Cold war transitional period, and South Africa after the collapse of apartheid.
The two 9/11s 28 years apart bracket the United States’ descent into madness. Much like the vintner’s abolition of the dop, the downing of the Twin Towers should’ve triggered some soul-searching in the United States, and an examination of our accumulation of stuff through the dispossession of other human beings. As we mourn the losses on that Indian-summer day in 2001, what we need to contemplate is redemption, not revenge — and how we might begin to rejoin a human community that we’ve wronged, again and again and again.
God Bless America. . . . and everyone else too.
Top Photo | Chrissy Bortz of Latrobe, Pa., pays her respects at the Wall of Names at the Flight 93 National Memorial in Shanksville, Pa. after a Service of Remembrance, Sept. 11, 2018, as the nation marks the 17th anniversary of the Sept. 11, 2001 attacks. Gene J. Puskar | AP
Jon Jeter is a published book author and two-time Pulitzer Prize finalist with more than 20 years of journalistic experience. He is a former Washington Post bureau chief and award-winning foreign correspondent on two continents, as well as a former radio and television producer for Chicago Public Media’s “This American Life.”