Chile: a case study in the tension between economics, ecology, and democracy

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Last spring, Isadora Nogueira, Barnard college senior and City Atlas intern, studied at the University of Santiago. This summer, Isadora explained to us Chile’s contradictions in pursuing economic growth and in simultaneously appearing to take real steps to meet the COP21 Paris agreement goals of decarbonization. This national challenge is highlighted by Chile being the host of COP25 in December (a meeting which Greta Thunberg plans to attend).

Isadora’s essay, below, turns out to be prescient. In the past week, after a hike in the price of subway fares, anger about generational inequity and economic inequity burst into the open. And as reported by the New York Times and Bloomberg, the government has now repealed the fare hike but cracked down on protestors and declared a state of emergency.

The seeds of this crisis, as found in a term of study in Santiago:

This coming December, Santiago’s Parque Bicentenario de Cerrillo will host the United Nations’ 25th Climate Change Conference of the Parties (COP25), giving Chile the opportunity to showcase its climate leadership on the world stage.

After last year’s 24th convention in Eastern Europe, Latin America was next in line for the international series of meetings. COP25 was originally set to take place in Brazil, but the location was changed when Brazil withdrew its candidacy, citing “budget issues” following the election of far-right candidate Jair Bolsonaro, who has threatened to pull Brazil out of the Paris accord. 

Chile then inherited the COP25 mantle, and in June, the government of conservative president Sebastián Piñera announced a framework to completely phase out coal by 2040 and aim towards carbon-neutrality by 2050, bringing the country within the Paris agreement standards that would hold temperature change to 1.5°C – if the goals are met. 

Chile has already taken some decisive climate action, not only moving away from coal to renewable energies, but also promoting energy efficiency, and expanding electric taxis and bus fleets. Santiago is a participant in the C40 movement, a global network of cities committed to the Paris Accord at a municipal level. 

Before thousands of government workers, business leaders, and environmental organizers flock to the capital in December, what is the climate of climate change in Chile? A look at the climate issues in Chile shows both the progress and the insufficiency of previous measures, and highlights the need for the Conference of the Parties to promote a new economic paradigm of regeneration and sustainability, moving away from the neoliberal development paradigm of the 20th century.

Chile is highly vulnerable to climate impacts. The logn and narrow strip of land hosts a broad range of climates. The country spans over 40° in latitude from its northernmost to southernmost tip, framed on one side by the Pacific and on the other by the peaks of the Andes.

The central, mediterranean climate zone of Chile is suffering the worst drought in 60 years. Highly unusual floods in the Northern desert region claimed several lives, homes and roads this February. In the sub-polar south, heat waves sparked numerous forest fires and forced the government to declare disaster areas . Weather stations recorded all time highs in Santiago and several southern cities including Puerto Natales, Porvenir, Coyhaique and Cochrane this January. 

Unlike the US, denialism has not paralyzed action in the South American country. Also in contrast to the United States, Chile did not pull out of the Paris Agreement with the inauguration of their own multi-millionaire entrepreneur as president in 2018. Both Piñera (president 2010-2014 & 2018-2022) and socialist ex-president Michelle Bachelet (president 2006-2010 & 2014-2018) agree on advancing  Chile as a world leader on climate change reform and replacing its electricity grid with green and renewable energies.

But most of the electricity demand fueled by Chile’s huge economic growth in the last decade has been met by the construction of new coal plants by the first Piñera administration from 2010 to 2014, which doubled the country’s installed capacity since 2010. Chile’s 5GW coal plants now provide about 40% of the nation’s total electricity generation. 

Source: International Energy Agency 

Foreign dependency and emissions from coal led the Bachelet administration to introduce regulations that resulted in the construction of 3.75 GW of renewable capacity, mostly in the form of hydropower. Bachelet can therefore be credited with moving the country away from its dependency on coal and towards wind, solar and hydropower; more than tripling total renewables from 5% to 18% of total energy production between 2014 and 2018.

Bachelet’s government also transformed large swaths of land in Patagonia into a network of protected national parks and created several marine protection areas.

To President Piñera’s credit, he is also vocal about the adaptation and mitigation strategies needed. On paper, his climate change law is comprehensive, and sets out a framework to better monitor greenhouse gases, incorporate adaptation into the work of various federal bodies, regulate and enforce carbon emissions and taxes from different sectors, create a public forum to promote inclusion and participative democracy, decentralize and regionalize climate change response, and fund further scientific investigation. 

Chile is now well on its way to a renewable energy grid. Renewables are now cheaper than coal, which represents a huge economic opportunity, says Victoria Alonso, a consultant for private environmental protection. However, when asked whether Chile is a leader in environmental reform she signaled an important caveat:  “Being primarily an exporting country, Chile has been a leader in environmental reforms which give it access to better markets. At the same time it tends to be late and reactive in issues without immediate economic gain, for example, in the theme of water rights or the creation of protected areas.” In other words, it can be said that Chile has advanced in environmental reform mainly when immediate economic interests align with ecological benefits.

Chile has a strong international reputation, and is the only South American country in the Organization for Economic Cooperation and Development (OECD), a forum of countries committed to “democracy and free markets.” With an average annual income of $24,600 dollars, Chile also holds the highest per capita GDP in South America.

Chileans are well aware that their country is by and large considered the “most developed” in the region, but are quick to point out the cracks in this image. The statistics on growth, it seems, can not hide a rising sense of uneasiness and instability. Ever growing competition for jobs, the cost of education, crime and class differences are raw realities of everyday life and have produced deep disillusionment with the promise of progress. The fact that politics is no longer seen as a viable path to change exacerbates this discontent. One explanation for this disillusionment from political scientist Claudio Fuentes, is that the post-dictatorship democracy has produced a distant and separate “political class” unwilling to share power in any aspect of the decision-making process. The existing mechanisms of citizen participation are viewed as largely fraudulent, generating high expectations but ultimately incorporating the interests of corporations over that of affected communities.  Piñera’s, and even Bachelet’s, environmental reform efforts have thus been met with skepticism from the leftist community. Julio Saavedra, a journalist and friend put it plainly: “The state has gone from being a regulator to a facilitator of resources for private interests.” 

“A big part of the problem in Chile is that we don’t have the tools for the state to control industry…we leave it all in the hands of the market, the decisions and the resources. And the market has a very short vision of the future,” says Professor Anahí Urquiza, a climate sociologist at the University of Chile. “The side that hasn’t completed its job is the state. Regulatory policy has been abandoned by the state.”

Chile’s free-market, neoliberal economy was established by the US-backed military dictatorship that overthrew socialist president Salvador Allende in 1973, and remained in power until 1989. The structure of the country was altered fundamentally, privatizing huge portions of industry from education, to social security to water. The economic growth that followed was thus heralded as exemplary by US conservatives, and even referred to as a “miracle” by economists like Milton Friedman. The dictatorship established the current foreign investment-dependent, deeply extractive economy with one of the world’s strongest protections for private property. A new economic paradigm must be at the forefront of discussions at the conference of the parties, but would mean a drastic 180° from free-market, structural adjustment policies of the 1980’s. 

While Chile has pioneered innovative public health regulation, like requiring warnings on high calorie and high fat food products or limiting junk food marketing to children, it has come up short in its regulation of natural resources industries. In the context of the drought exacerbated  by climate change, the weak regulatory framework for water has become an increasingly critical source of environmental injustice. This is especially crucial considering the water intensity of Chile’s mining, logging and agriculture industries. The current water code, established in 1981 by the military dictatorship, gives free and unlimited rights for surface and subterranean waters to private companies. Over-exploitation has dried up water sources all over Chile. This has led to the highest water prices in Latin America, and made rural and indigenous communities increasingly vulnerable to displacement. In communities like Petorca, it is common for the population to have to pay to truck in water while 100% of the water rights are reserved for big agriculture. 47% of rural homes, equivalent to 1,000,000 people, do not have regular access to regular drinking water . According to experts on Chile’s political system, the root of the problem is the 1980 constitution, which has some of the world’s strongest protections for the rights of the private sector at the expense of public health. Constitutional reform is needed for the government to reappropriate water for more critical needs, like human consumption, and to move from unregulated rights of ownership to limited rights of exploitation. 

Rather than viewing the “ecological” and “economic” as separate spheres, Chile signals the need to move globally towards regenerative economies. Electrifying energy grids while maintaining the economic and legal structures that produced the climate crisis will still result in ecological and therefore civic, collapse.

There is much more that needs to be done in order to create an ecological economy. Chile is emblematic of the “development” of the 20th century, but development in the 21st century must be about using the least possible, and wasting the least possible, in order to secure healthy and complete lives for current and future generations.

The moment to march is now, says Professor Urquíza in her classes, always trying to persuade her students towards civil disobedience. The only way to change the politics of climate change is through protests. Or in the words of Frederick Douglass, “power concedes nothing without a demand.” There has undoubtedly been a rising tide of consciousness among  youth in Chile. This is most visible in nutrition, with rates of vegetarianism and veganism soaring in recent years.

Radical quotes like “don’t be a speciest feminist” or “only human extinction will stop all other extinctions” can be found in grafitti on the city’s walls or in bathroom stalls of the University of Chile. On March 15th, over two thousand students in Santiago joined in the global climate protests sparked by Greta Thunberg. But while there are pockets of deeply climate conscious people, especially among urban youth and the indigenous population, the gravity of the problem has not fully been absorbed by most. Climate change, and environmental problems in general, Professor Urquiza explained to me, rank only in about tenth place when people discuss Chile’s “laundry list” of social issues. From structural instability, to energy poverty, to environmental health, to the urban heat effect, poor, elderly, indigenous and immigrant communities are the most vulnerable to harm from climate change. Educating the population on the realities they will face from the changing climate, and energizing their activism is the most essential step forward.