Thursday, August 30, 2007


Thousands Riot in Chile

Over 400 people were arrested and hundreds injured yesterday when Chile's largest trade union (Chilean Workers Center) called for a day of protest over President Michelle Bachelet's Socialist administration economic and trade policies.

Police threw tear-gas at protesters as clashes broke out in several cities during the nation-wide protest. Most of the violence was in Santiago, near the Presidential Palace, where riot police turned water cannons on protesters blocking the streets.

This riot wasn't just students. It was middle class. Even though Chile's economy (more below) is doing quite well with copper's high prices, the middle class feel the rich are getting richer while they are not only being left out of the economic boom but getting screwed in the bargain. Yesterday the middle class made it clear they were done being screwed.

Call it a Chilean version of Labor Day. Or the Boston Tea Party.

Guardian Unlimited

Thousands of Chileans took to the streets yesterday in a burgeoning middle class revolt against the 17 years of coalition government that has ruled since the fall of Augusto Pinochet in 1990.

Television images showed senator Alejandro Navarro, of President Michelle Bachelet's Socialist party, bleeding from the back of his head after apparently being clubbed by a police officer. Mr Navarro, who was treated in hospital, supported the protest.

"This protest will start to change things. There will be one after another," said Arturo Martinez, of United Workers Central. The union is tapping into widespread anger at economic inequality in Chilean society. As riot police and ruling party politicians tried to play down the protests, the capital was filled by protesters demanding higher pensions, better public transport, subsidised housing and a halt to rising food and electricity prices.

President Bachelet initially defended her record as a progressive politician, then conceded and promised "subsidies to all" families in need and a "short-term solution" for economic inequality.

Yesterday's protest comes after weeks of labour action, including strikes by poultry workers in southern Chile and copper miners in the north. Union leaders called the demonstrations to protest against the government's "neo-liberal" economic policies and to further the national debate about the country's minimum wage.

Salaries for workers have been at the forefront of public debate after recent statements by Bishop Alejandro Goic calling for "an ethical [minimum] wage" for Chilean workers.

Chile, with 15 million inhabitants, is the world's biggest producer and exporter of copper, ahead of the U.S. and Australia. The economy expanded 6.1 percent in the second quarter fueled by higher investment, domestic consumption and exports. Copper prices rose 16.7 percent this year.

``People see the money and they say to themselves, `Why don't they spend it,''' said Julio Espinoza, an analyst at brokerage BiCE Corredores de Bolsa in Santiago. ``It's a very difficult situation.''

Giving into the demands would add to pressure on inflation, already at the upper end of the central bank's target range, and might lead policy makers to boost interest rates to stem rising prices, he said.

The price of copper, Chile's main source of foreign exchange, has rocketed this year to as much as $3.71 a pound on July 20 from as low as 60 cents in 2001. Copper for delivery in December rose 3.15 cents, or 0.95 percent, to $3.34 a pound on the Comex division of the New York Mercantile Exchange at 3:12 p.m. New York time.

``When you press a balloon, sooner or later it explodes, and in this case the people are the balloon,'' said Luis Perez, a 32 year-old employee at a law office in Santiago, after joining the protest. ``The country has money in the pockets but it doesn't help poor people.''

With state revenue benefiting from the two-year surge in copper prices, the government should be spending more, said Roberto Daza, a 41-year-old taxi driver in Santiago.

``We have a terrible health system, hospitals are crammed with patients,'' he said. ``Chile has lot of resources from higher copper revenue that should be distributed more equitably among the people,'' he said.

Codelco, owned by the Chilean government and the world's largest copper producer, said on Aug. 14 that it added a record $4.67 billion in profits and taxes to government coffers in the first half of the year.
My mentor, my boss for six years is a senator in Chile, representing the Tarapac√° Region, Chile's northenmost administrative and one of the poorest regions in the country. There's nothing on Fernando Flores' blog (auto-translated by Google) about this so far but we shall see. Check back.

I'm with the Chilean middle class. Hell, I'm with the American middle class. Want to have a general strike? Go Union go! Not a fan of the violence so much, but hey... I'll be happy to help clean up the blood. I like a good spot of trauma I do. *smiles sweetly*

This Republican crap about how we should take the money and give it back to the rich via tax cuts so they can trickle it back down. Bullshit if I ever heard it. Sure, you need to take a reasonable amount of capital and reinvest in capital improvement and in new projects. But then you need health insurance for everyone, education for everyone, retirement and vacation, childcare for everyone. Take care of the people doing the work so they have time to raise their families, learn new domains of knowledge, invent entirely new fields of opportunity, and rest when their work is done, all in good health.

What is just plain wrong is taking the money made by the people doing the work (that's you and me) and handing the vast overwhelming majority of the money to the few people at the top who make the major business decisions, own most of the company stock. It's bullshit. I'm not talking about paying out on 401K's. I'm talking $2-50 million dollar salaries and options for CEO's and other top executives and corporate officers.

It isn't a question of not having a market economy. It's a question of the government not making sure all its citizens are provided for. As the citizens of Chile are making clear.

Go Union go! And here in the United States... Happy Labor Day.