A revolution in Chile sparked by U.S.-style economics. Our billionaires should be very worried | Will Bunch

The biggest fires are always started by the tiniest spark. That was almost literally true in 2011 when an unknown street vendor in Tunisia set himself on fire to protest corruption and government harassment, and triggered the Arab Spring, a series of uprisings that roiled an entire region and inspired movements like Spain’s Indignados and Occupy Wall Street.

In 2019, as an autumn of popular uprisings erupts around the globe, the most dramatic revolution of the moment is taking place in the shadows of the towering mountains of Chile, where as many as a million people flood the streets of capital city Santiago by day, and harrowing street battles have erupted at night. What set off this political conflagration? A subway fare hike that -- converted to U.S. money -- amounts to less than 5 cents.

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But to massive numbers of Chileans, those 30 extra pesos were literally the last straw, and not just because transit fares in the South American nation had doubled in 12 years to take a toll on lower-income families. The fare hike touched off much deeper anxieties about income inequality in a nation often held up as an economic success story because of its rapidly rising gross domestic product (GDP), yet has seen much of that wealth flow to a narrow sliver at the top. That’s in addition to social unease over fewer opportunities for Chile’s browner-skinned indigenous and mixed-race people, often packed into outskirts barrios.

At first, students began protesting by hopping turnstiles and dodging the fare, chanting: “Evading, not paying, another way of fighting!” But things escalated. More than a dozen subway stations burned. The government of President Sebastián Piñera responded with a repressive crackdown, then a retreat of rolling back the fare, announcing new measures for the working class, and lifting a curfew. Yet on Saturday, more than a million people flooded Santiago’s Plaza Italia for the largest protest yet, and no one knows how all of this will end.

Americans should be paying a lot closer attention to all of this -- and not just because 50-plus years of U.S. meddling in a capital some 5,000 miles south of Washington have played a key role in getting things to this point. After taking the advice of America’s conservative economics professors for decades, Chile now has -- according to one survey -- the world’s highest level of income inequality. No. 2 on that list? The United States. No wonder this nation’s billionaire oligarchs are so worried about the 2020 elections. They ought to be terrified.

I imagine that the tortured (in too many cases, literally) history of U.S.-Chile relations is not well known to many younger voters. In 1970, the people of Chile chose a more socialist path and democratically elected a left-wing president, Salvador Allende. But Allende and his populist reforms weren’t popular with one group: U.S. corporations like ITT, Pepsi and Anaconda Copper, and they leaned heavily on a friend in the White House, Richard Nixon, and his chief foreign policy architect Henry Kissinger, to do something.

What they did over the next three years -- starting with the CIA-backed assassination of a Chilean general in 1970 -- was one of the bloodiest and most morally unconscionable chapters in the history of U.S. foreign relations. It culminated with history’s original Sept. 11 attack -- a violent American-aided coup on that date in 1973 that led to Allende’s death, the empowerment of military dictator Augusto Pinochet, and a reign of terror in which at least 3,000 and perhaps many more political opponents were murdered or “disappeared,” soccer stadiums became concentration camps for thousands, and many were brutally tortured.

For his sordid role in all of this, Henry Kissinger was investigated, then arrested in handcuffs and flown to The Hague, where he stood trial for crimes against huma ... oops, I’m sorry. I was briefly transported to an alternative universe, not the reality-based world where Kissinger was awarded a Nobel Peace Prize and became the respected 90-something elder of American foreign policy, consulted and revered by both Hillary Clinton and Donald Trump.

But the warm and fuzzy relationship between Washington and the brutal, authoritarian government of Pinochet, who remained in power into the 1990s, allowed for a lesser-known chapter that’s highly relevant for today’s moment of rising unrest. Here at home, a rising cadre of prominent right-wing economists saw not horror in Pinochet’s dictatorship but an opportunity -- a chance to test their radical free-market ideas without hindrance from pesky left-wing politicians or labor leaders who had almost magically disappeared from the scene in Chile.

The economists who ran Chile’s economy during the Pinochet era were called “the Chicago Boys” because of their close ties to the University of Chicago and its free-market guru Milton Friedman, who famously said he didn’t see the “evil” in simply giving economic advice to a violent right-wing dictator. Another under-the-radar American adviser to Chile was University of Virginia Nobel laureate and ultra-conservative James Buchanan, who (as chronicled in Nancy MacLean’s remarkable Democracy in Chains) developed an economic regime of “individual liberty” that favored individuals who were very wealthy and, even more incredibly, was first developed as a stealth way for Southerners to fight school integration after 1954′s Brown v. Board of Education.

What these advisers told Pinochet will sound familiar to Americans who’ve watched the parallel rise of the Koch brothers (who also worked closely with Buchanan) after their influence over the GOP here at home: privatization of government programs, from old-age pensions to municipal water, school vouchers, and encouraging private health insurance for those with higher incomes that undermined the medical safety net for the poor. Yet the Chilean economy was not strong when “the Chicago boys” held full sway, but it did achieve impressive GDP growth once Pinochet fell out of favor and a period of center-left rule returned some government role to the economy.

One thing is beyond dispute, however: An economy that largely turned to free-market conservatism in tandem with the United States has managed to not only mirror but exceed our wealth gap. One recent study found that the top 0.1 percent in Chilean society earn 19.5 percent of the nation’s income, the kind of stat that makes a mockery of “good” GDP numbers. Those who’ve spent time in Chile or written about it say the sense of inequality and resentment is palpable. “Beyond data,” wrote Francisca Skoknic in The Nation, “the feeling among a large swath of the Chilean population is that rich people get special privileges and that private companies with high profits control their day to day life.”

The vivid images we now see on the streets of Santiago -- the daytime throngs and the nighttime hellscape of fire and tear gas haze -- are the inevitable result of a society built upon a foundation of unfairness. It would be quite the story if this were just happening in Chile, but people are rising up everywhere -- over inequality, austerity measures that only target the poor and working class, and government corruption that robs everyday folks for the benefit of elites. And so they’re also on the streets in Baghdad, in Port-au-Prince, in Beirut, in Hong Kong, and to some extent in dozens of other nations, in both democracies and dictatorships.

And what about Chile’s rival for income inequality, the United States? While there have been significant protest movements over income inequality (Occupy Wall Street) and its symptoms (the March for Our Lives, climate strikes, the Women’s March), the last few years have shown that Americans remain a people who pin a lot of our hopes, for better or worse, on the ballot box, not on the street. As Sen. Elizabeth Warren rises in the Democratic polls and her ideological cousin Sen. Bernie Sanders enjoys something of a bounce back, the chances are growing in the United States for a political revolution that could undo Chicago Boys-style governance here at home, without damaging any subway stations in the process.

And yet this nonviolent revolution still has America’s billionaire class in a total panic.

In recent weeks, Wall Street and other big-money political funders have run to their favorite journalists -- who’ve responded with headlines like Politico’s “Corporate America freaks out over Elizabeth Warren” -- and floated delusional, desperation theories that some benevolent billionaire like former New York Mayor Michael Bloomberg or some other plutocrat could still enter the 2020 race at 11:58 and somehow save their pampered skins.

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“Ninety-seven percent of the people I know in my world are really, really fearful of her,” billionaire Michael Novogratz told Bloomberg (heh) News recently of Warren, but the wealthy acknowledge that every time they attack Warren, Sanders, or their proposals such as a wealth tax to fund social programs like universal prekindergarten, eliminating college debt or universal health care, it only makes the chances for their victory stronger.

That’s because you don’t need to fly a helicopter over the streets of Santiago to see that there’s a lot more of us than there are of them. The Milton Friedmans and the James Buchanans of this world were able to get away for decades with their ridiculous theories that freedom for billionaires would eventually trickle down dollars on regular folks -- until the day we woke up and discovered we didn’t even have enough change for the subway. The fires may have started in the shadow of the Andes, but you can already smell the smoke up on Wall Street.