A Neoliberal Country in Focus:

The New Middle Class in Chile

Patricio Navia

Buenos Aires Herald, October 9, 2011

 

Two decades after the restoration of democracy, Chile’s middle class is flying high. Larger and more diverse, the middle class is now testing its political muscle and demanding that government social policies be redesigned to fit its needs. After 20 years of vigorous growth, Chile’s new middle class has also developed a sense of vertigo, fearing that it might be vulnerable. At the same time, the middle class is determined to fly even higher. Not surprisingly, middle class children, with the sympathy of a majority of Chileans, have taken to the streets to simultaneously demand a stronger safety net and the elimination of the glass ceiling that prevents them from flying higher.

 

Chile is going through its best moment in history. Chile has grown strongly and steadily for three decades. Those who have yet not reached 30 years of age—more than half of the nation’s population—have no memories of the years when poverty was 40% and democracy was absent. For younger Chileans, the future has always been brighter than the past. Unlike countries where there is a growing gloomy feeling about the future, Chileans are exceedingly optimistic about what is to come. Most Chileans firmly believe that their children will have even better lives. Those children have taken to the streets to ensure that their passport to a better life—a better quality and affordable education—will be available to all those who want to join the middle class.

 

Most social and development indicators show remarkable progress in Chile. Life expectancy is among the highest in Latin America. Health coverage has increased dramatically. In less than 30 years, child obesity replaced malnutrition as a leading public health concern. Coverage for primary and secondary education is universal. Almost 60% of college-aged Chileans are enrolled in higher education institutions. More than 70% of them are first generation college students. Consumption power has expanded considerably. After acquiring citizenship rights in 1990, Chileans are increasingly exercising their rights as consumers. With the fear of an authoritarian reversal vanished, Chileans are also venturing into political deliberation. Economic growth has attracted immigrants from other Latin American countries. Though the population remains more conservative than liberal, Chileans are increasingly tolerant of diversity in all of its forms. Liberally minded Chileans are expanding the scope of freedoms and tolerance.

 

Paradoxically, younger Chileans who never experienced the hardships of the brutal recession of the 1980s and grew accustomed to seeing growth and development as inevitable are now showing signs of distress, concern and dissatisfaction. A sense of malaise was first identified in the 1990s, but was systematically exaggerated by foes of the market-friendly economic model in place since the Pinochet years and improved and complemented with social policies since democracy was restored. In recent, months that malaise has again manifested itself in social protests and mobilizations led by college students. Though many critics of the socially-oriented market economy have rushed to announce its demise, a more accurate diagnostic will conclude that the otherwise successful economic model needs adjustments and corrections.

 

Chileans who have moved up in terms of income and consumption levels feel vulnerable and fear that their middle class condition might be precarious. The social safety net designed to aid those at the lowest 40% of the income ladder is set far too low for the next 40%, the emerging middle class.  Many Chilean families feel that any economic turbulence will put their dreams in jeopardy. As Chile’s tax structure is not sufficiently progressive, the government does not have sufficient resources to fund programs for the middle class. That middle class wants tax reforms that will allow the expansion of social services, especially higher education subsidies. Because the middle class is flying high, it wants a safe place to land in case times get rough.

 

Just as Chileans want to fly even higher, persistent inequality continues to separate those in the middle class from those at the top of the income ladder. Unequal access to education and the heavy burden many middle class families have to take on to pay for their children’s education further separates those in the middle from the traditional elites. Because the promise of social mobility requires a leveled-playing field, the middle class demands reforms that will allow them to aspire to be part of the elite. The distance between the elite and the middle class must be reduced and the playing field must be leveled. In a society where social mobility is a reality, the elite is not comprised by the same people generation after generation.

 

The popular mobilizations that have rocked the Chileans normally quiet political scene do not herald the end of the market-friendly economic model in Chile. Instead, those protests reflect the success of the model in fostering the development of a strong and ambitious middle class. Rather than destruing the goose that lay the golden eggs, the middle class is making its voice heard to make sure they get their fair share of golden eggs.