Chile’s Bachelet Tacks Center to Pursue Needed Reform at Home.
By Eric Farnsworth, Aug. 11, 2014
Eyebrows arched in Chile at the end of July when President Michelle Bachelet canceled her participation in a summit of MERCOSUR leaders in Caracas, Venezuela, to focus on her domestic agenda. Critics suggested this was because her signature education reforms are in trouble. The Chilean president was elected for a second time at the end of 2013 and inaugurated in March with a mandate for overhauling the country’s education system, and she has moved quickly to introduce the first phase of a process that will ultimately lead to universal free higher education by 2020.
Students have been a well-organized and vocal constituency in Chile for some time, effectively calling attention to their demands through street protests and political pressure. The movement created particular difficulties for Bachelet’s predecessor, Sebastian Pinera, and the 2013 presidential campaign highlighted the need for significant reforms. In May, the administration sent the first part of its reform package to congress. It seeks to increase government support for education while curtailing the profit motive in state-funded schools, increasing and encouraging a more egalitarian approach for student access from nursery school through university.
The reforms have become complicated, however, particularly within her own coalition, which is further to the left than her first coalition government in 2006-2010 and seeks greater accommodation to the demands of the student movement, including active consultations. The conservative opposition has also expressed concerns. Education policy has been debated for years within Chile, but since the election it has become political ground zero, a symbol of broader social reform with significant implications for spending, workforce development, social inclusion and economic competitiveness. Education Minister Nicolas Eyzaguirre has acknowledged a lack of diplomacy in developing the reforms but has otherwise held firm, suggesting that postponing or diluting the effort could put Chile on the path to populism.
At the same time, the fiscal demands of a commodities-based economy that counts a slowing China as its top trade partner, coupled with Chile’s well-earned record of fiscal probity, mean that resources for reform must be identified in a manner that does not weigh unduly on the macro-economy. This is the tightrope that Bachelet is attempting to walk, not just in education policy but also in health, environment, energy and social development policies, all while seeking to honor commitments to overhaul tax policy and identify additional resources to bolster government spending.
The resulting policy battles between competing interests characterize any strong democracy. And as Chile continues to advance into the ranks of developed democratic nations, political fights over domestic spending priorities—driven by the raised expectations and increasing demands of a politically empowered middle class—will likely increase. Indeed, a recent survey in Americas Quarterly rated Chile highly compared to its Latin American peers on social inclusion indicators, while nonetheless knocking the country—ironically, perhaps—for a lack of attention to women’s rights.
The president’s decision, therefore, to skip a meeting of MERCOSUR leaders was not all that surprising nor particularly consequential. Chile is not even a full member of the group, and President Nicolas Maduro’s Venezuela, the host country, represents a political and economic model with which Chile would rather not be publicly associated.
The cancellation also illustrates how Bachelet’s approach to international affairs somewhat mirrors her approach to domestic matters. The new administration is clearly refocusing Chile’s foreign and trade policies, prioritizing Chile’s traditional foreign policy relationships within its own South American neighborhood, with a special focus on Brazil. This has led some observers to speculate that Chile is looking to position itself more fully in support of South American political and economic integration schemes, downplaying existing relations with North America and Asia and also rejecting actions that might be perceived as helping to divide Latin America among competing MERCOSUR and Pacific Alliance blocs.
But such fears appear to be misplaced. Chile is, in reality, working to become something of a bridge between blocs. One of Bachelet’s first trips was to Washington, in June, where she was warmly received by President Barack Obama and Vice President Joe Biden. Earlier, she participated in the June meeting of Pacific Alliance leaders in Punta Mita, Mexico, reaffirming Chile’s support for an important trade bloc that includes Chile, Colombia, Mexico and Peru, and reassuring observers of Chile’s interest in proceeding on the path toward economic integration within the Pacific Alliance framework.
Bachelet has also worked to maintain Chile’s partnerships in Asia. She met with China’s President Xi Jinping in mid-July during the BRICS summit in Fortaleza, Brazil. Japanese Prime Minister Shinzo Abe traveled to Santiago at the end of July where the two leaders exchanged views on a range of issues, including technological cooperation and earthquake- and tsunami-related disaster preparedness and relief. Chile’s participation in Trans-Pacific Partnership negotiations continues apace, while it has worked effectively on the United Nations Security Council as a rotating member.
After only four months in office, it’s far too early to judge whether Bachelet’s efforts to navigate among competing interests will prove effective, internationally or domestically. A weak economy makes governing more difficult, and her task is further complicated by the fact that this is her second, though nonconsecutive, stint in office; her political honeymoon was short and shallow unlike those generally afforded other newly elected presidents. Her signature education reforms have already proven politically controversial, with the outcome uncertain.
What the recent episode with MERCOSUR shows, however, is that her instincts remain firmly centered. Rather than travel abroad to a meeting that was relatively unimportant for Chile, where she would be photographed with a radical populist like Maduro, she chose to remain in Chile to work on an issue of real importance to Chileans, and to her own political fortunes and legacy.
Substance trumped showmanship. And that is important to remember as Chile’s leaders work to keep the nation on course toward full democratic and economic development in the weeks and months ahead.
Eric Farnsworth heads the Washington office of the Americas Society/Council of the Americas. During the Clinton administration, he was the senior adviser to the White House special envoy for the Americas.