Update on Chilean Politics

March 9, 2002

Patricio Navia


As the government organized one of its famous but sporadic ‘festivals of culture’ to celebrate its second anniversary in office, the mood in La Moneda was clearly more festive than any other time except when president Lagos was inaugurated on March 11, 2000. After a short honeymoon, mired by the usual gaffes of a new administration and unable to quickly transform some of his campaign pledges into actual legislation, the Lagos presidency seemed destined to administer the third, last and least eventful Concertación government in Chile. The 2000 municipal election consumed much of the government’s efforts to reorient government policy and social expenditures in 2000. The effort partially paid off, as the government coalition obtained 52% of the vote, but coordination failures among candidates gave the opposition control of 166 (48.5%) municipal governments despite having obtained more votes than the Concertación only in 109 (32%). Although the Concertación won in 52 of the 75 largest municipalities (70% of the national population), the Alianza captured 38 municipal mayoralties despite having defeated the Concertación only in 22. Joaquín Lavín, the Alianza’s 1999 presidential candidate, easily captured the mayoral office of Santiago (downtown municipality) repositioning himself as the all-but-assured Alianza presidential candidate in 2005.


Immediately after the 2000 municipal election, preparations began for the crucial December 2001 parliamentary election. The government adopted many short-term, electioneering motivated policies. The administration pushed through Congress a restrictive labor law reform and stroke a widely criticized (but apparently necessary for electoral considerations) deal with the public workers union that partially set back the ongoing state modernization effort. Although the government exercised commendable discipline in public spending, several job creation programs and unemployment subsidies were implemented to offset the negative effects of the 2-digit unemployment figures. Pressured by a well-financed and better-designed opposition campaign, the government spent much of 2001 worrying about the parliamentary elections. In the end, the opposition made some gains in the Chamber of Deputies, but the Concertación retained a slim majority in the lower house and the Senate remained tied 24-24 (with Augusto Pinochet barred by the supreme court from making use of his lifetime seat pending a now frozen investigation on the former dictator’s responsibility for human rights violations).


Two weeks after the election, signaling that his presidential term would really start at that point, president Lagos removed most of the regional Intendentes and provincial governors. His younger appointees, instructed to improve efficiency and selected to send a signal of renewal within the government alliance, helped boost Lagos’ popularity. However, the cabinet reshuffle of early January—when ministers were sacked, including Legislative Affairs and Spokesperson—might go down in history as the real turning point in his administration. The president indicated that he was ready to move beyond short-term electoral concerns. Striving to maintain a delicate balance between the PDC and the leftwing PPD-PS-PRSD blocks, the president put special emphasis on intra-government coordination and on softening tensions with the business community.


If the government’s agenda during its first 24 months was focused on reducing tax evasion, reforming the tax structure and passing a rigid labor law reform, early indications suggest that the government is through with business-unfriendly legislative initiatives. The only exception might relate to the anticipated, and previously delayed, health reform. Championed as a centerpiece of Lagos’s presidential campaign, the original version of the health reform was labeled as obstructive to economic growth, a tax increase for employers and an unnecessary growth of the public sector. The January cabinet change brought a new Health minister. Perceived as more friendly to businesses and physicians, Minister Osvaldo Artaza will likely reshape the health reform and take on the powerful health workers union. Thus, even the most business unfriendly pending legislative initiative will be much friendlier to the business sector than the legislative pieces championed in 2000 and 2001.


Tensions with the military, common in the early 1990, have all but disappeared. Just as Lagos celebrated his second anniversary in La Moneda, General Emilio Cheyre replaced General Ricardo Izurieta as the head of the army. It was the first trouble-free change of command in the army since 1964. Although little progress has been made on finding the remains of hundreds of political opponents killed during the dictatorship, civilian control over the military is strongest now than at any point since 1990. The president’s recent authorization to purchase F-16 jet fighters and delayed the construction of navy vessels is evidence that the civilian government has much more muscle to exert over military affairs than the constitution and deadlock laws implemented by the dictatorship had provided for.


Had it not been for the tough economic times worldwide, Lagos would be about to embark in the most successful months of his administration. Yet, perhaps the difficulties and challenges from abroad have led the president to stop quarreling with the powerful and non-negotiating business community. Lagos’s decision to make peace with the conservative business sector and to work towards a consensus plan for economic recovery might not fair well with many within his Concertación alliance. Many within the left, particularly in the PS, will resent what they see as a betrayal of the ‘fighting inequality’ pledge of the Lagos campaign. Some in the PDC will also resent the effort to reduce a number of subsidies and to put on the table the issue of privatizations of state-owned enterprises. Lagos is likely to find ways to appease the PS, but making many PDC happy will be more difficult.


Ready to deliver on his campaign promise of legalizing divorce, Lagos is collision course with the Catholic Church. After passing legislation to end film censorship and to authorize circulation of previously banned films, the government moved to approve distribution of a ‘day-after’ pill, a contraceptive medication labeled as abortive by the Church. Tensions with the Church reached a peak when President Lagos visited Rome in early March but was not given an appointment to meet the Pope. Diplomats stepped in and Lagos will visit the Holy See in May. The upcoming visit has added speculations that Lagos will present his case to legalize divorce in Chile before the Pope. Although a fierce battle is expected with the Church and conservatives who oppose legalization of divorce, Lagos is poised to win this battle if he makes the right moves. Public opinion overwhelmingly supports a divorce law and politicians that oppose it—including most conservatives and many within the PDC—will pay a high price if they try to block the reform.


Lagos will likely appease his leftwing constituency with the divorce law initiative, but will hand a hot potato to his PDC allies. Many defined the recent appointment of PDC rightwing Senator Adolfo Zaldívar as party president as a major headache for president Lagos. Zaldívar and Lagos do not get along and the PDC senator has made it clear that he intends to reposition his party even at the cost of harshly criticizing the government. Zaldívar’s political plan aims to resurrect the three-thirds division that characterized Chilean politics before 1973. Pushing the Alianza to the Right and the PS-PPD-PRSD to the Left, Zaldívar wants to leave the Center clear for the reinvented PDC. The survival of the Concertación as a Center-Left electoral, rather than political, alliance remains in doubt. By bringing forth the divorce law initiative, Lagos is calling Zaldívar’s bluff. If public opinion aligns along a pro divorce government—anti divorce Alianza division, Zaldívar—a divorced man himself—will find it difficult to come up with a third alternative. Zaldívar’s problems go well beyond the ‘moral debate.’ He needs to heel his party and to reinvigorate it toward the 2004 municipal election. His anticorruption platform has been welcome, but many have denounced his selective use of the discipline tribunal as a vengeance against his opponents within the party.


Some conflicts within the government coalition should re-emerge as the PDC repositions itself after the electoral debacle of December 2001. A few ministers and undersecretaries—most notably Foreign Affairs Minister Alvear and Interior Undersecretary Jorge Correa—are in the list of disposable names within the new PDC leadership. But internal PDC power plays will likely dissuade Zaldívar from requesting their removal from the government. Aware that the core of tensions within the Concertación will come from the PDC and its new leadership, the government will make special efforts to foster internal discipline. The appointments of Heraldo Muñoz as a Spokesperson and Mario Fernández as Legislative Affairs minister have already made the government work more smoothly. Interior Minister Insulza will continue to concentrate power and president Lagos will likely get less involved in daily government operations. In recent weeks things have ran so smoothly that politics seems uneventful. True, January and February have always been slow months in Chilean politics, as most government officials, opposition leaders and pundits go on vacation. Yet, the new cabinet should be less prone to gaffes and errors as the previous one.


The recent trip of Joaquín Lavín tu Cuba and his meeting with Fidel Castro (but not with island’s democratic opposition) confused many and was interpreted by most as an electoral effort to cater towards centrist and moderate voters who favor dialogue and tolerance over open confrontation. Lavín needs their vote if he aspires to win a clear majority in the 2005 presidential election. The Lavín trip and the recent arrest in Brazil of a handful of Chilean former guerrilla fighters involved in a kidnapping of a Brazilian businessman have raised Chilean-Cuban relations from the annals of history. As the U.N. Human Rights Commission vote on human rights violations in Cuba nears, Chile is caught between a rock and a hard place. If Chile votes to condemn, Lagos will alienate leftist sectors and will renege on a promise made in 2000 to lead an effort to work with Cuba to improve the human rights situation. If Chile abstains, critics from the right and the PDC will have a field day pointing at the contradictions between what the government says about human rights and what it actually does. In addition, the U.S. is looking for sponsors and co-sponsors for the annual human rights condemnation against Cuba and Chile is a natural and prime candidate.


Regardless of what ends up happening with the divorce law or the Cuba vote, Lagos is much happier with criticism about his stance on Fidel or the so called ‘moral issues’ than on criticism for his anti-tax evasion or labor law reform initiatives. He will take any day an attack for not supporting the defense of human rights in Cuba from ideological zealots than a much more damaging accusation that his new labor law hinders employment and slows economic recovery. If president Lagos ever hoped for a quiet time to carry out a consensual legislative agenda and to work on building his legacy, the remaining months of 2002 will be a dream come true. Sure, he will still have to deal with the economic crisis in Argentina, a low expectation of economic growth, significant complications in the trade negotiations with the U.S. and U.E and internal conflicts with the PDC, but he faces no elections until late 2004 (Municipal) and given the headaches caused by the campaigns and results of the past municipal (2000) and parliamentary (2001) elections, he probably thinks he is finally free to take on as president.


His success will partially depend on his ability to engage the PDC and its aggressive president, to discourage an early start of the presidential succession race within the Concertación and to make his cabinet function more efficiently and smoothly than in the previous two years. A slow but solid economic recovery will help, but in the next few months, the government will be more focused on diverting the attention away from the economy to the ‘moral value issues’ hoping to score some points and also hoping that the world economic recovery will help rescue Chile from its present economic stagnation.