Julian Hill (Bruce, Australian Labor Party) Share this | Hansard source

I second the motion. I thank the member for Wills for bringing this motion to the House. I have a friend. Let's call him Jose. He's Australian Chilean. I had a beer with him in January to catch up. We ended up talking for ages about the situation in Chile. I'd heard of some unrest—you know, you read the papers—but I hadn't really focused on it or thought much about it. I thought it might be some ratbag protesters or a political issue. The headline was about protesting against a rise of, I think, 30 pesos, which is four cents, in the public transport fees in Santiago. Jose said, 'Yes, in a narrow sense it started as that.' But he explained to me that it's much deeper than one issue or just one city and that these protests have now spread like wildfire across the whole country. The Australian Chilean community, many of whom I've now spoken to, believe that it will not stop until the people force major systemic change upon Chile, that the unrest will spread across Latin America and that there are lessons for the rest of the world that we must heed.

Jose explained to me that, in many key respects, the neoliberal system began in Chile under the brutal, murderous Pinochet dictatorship in the 1970s. I didn't know this history. It is a history of privileging private interests and extreme wealth over welfare and the common good of people, and they embedded it in the constitution of Chile. It's a system which has, since then, unduly constrained democratically elected progressive governments from implementing real reform. They actually can't do it, because they're hemmed in by the constitution that protects vested interests. This has led to massive, entrenched inequality, which has become a cancer on the whole society and now threatens the political stability of a country that has been largely stable for decades, since the military dictatorship fell.

It's funny, of course, that there are no members of the government, no Libs, who want to come up and talk about inequality and what it does to a country when it gets out of control. But it is a paradox for those who watch the economic statistics. It's confusing because, to much of the global community, Chile, with it's economic orthodoxy, is the poster child of Latin America. It has the highest growth rate in Latin America. It's the country that has joined the OECD. It's now a developed country, and you think, 'That's okay.' They've implemented decades of market based reforms and privatisations. It has the highest GDP per capita in Latin America. So, on paper, Chile is the miracle child of Latin America and is the country that everyone is supposed to aspire to: 'Be like Chile. Look at what they've done.' It's evidence of what's possible, apparently. To numerous visitors to Santiago the place looks prosperous—First World modern.

I am embarrassed to say I was one of those people in 2015, when I went there on a work trip in my previous role. I was in Santiago for a week, with universities and TAFEs, building education and research partnerships. I stayed in a lovely hotel and went jogging in the mornings, and it looked great. But I realise now that I never crossed Italy Plaza. I never ventured to the other Santiago, where most people live, where there are slums and shanty towns, where people are barely able to exist. For millions of Chileans the entire system is rigged and has been rigged for decades. Despite the headline growth statistics, they don't see the benefits of this rise in national income and wealth. The reason for this is the profoundly entrenched and unsustainable inequality. Chile is one of the most unequal countries in Latin America. I want to read into Hansard three paragraphs from a recent New York Times editorial:

The distribution of income before taxes is highly unequal throughout the developed world; by that measure, Chile sits roughly in the middle of the 36 developed democracies that constitute the membership of the Organization for Economic Cooperation and Development. What makes Chile an outlier among those 36 nations is that the government does less than nearly any other developed nation to reduce economic inequality through taxes and transfers. As a result, Chile has the highest level of post-tax income inequality among O.E.C.D. members.

… … …

Chile is not suffering from a lack of resources but instead from an unsustainably narrow conception of its obligations to its citizens. The military dictatorship that ruled the country from 1973 to 1990 rewrote the nation's laws and economic policies and reshaped its institutions to encourage free-market competition and to minimize the role of government. Its legacy endures. Even after increases in recent years, the Chilean government still spends a smaller share of total economic output than every other nation in the O.E.C.D.

Correlation is, of course, not causation, but no-one can believe it is a coincidence that, in the most unequal country in the OECD, the world has witnessed an outbreak of civil unrest. There are lessons from that for Latin American countries, but also for other developed nations that, as inequality rises and gets out of control, this is what can happen. Governance will break down and civil unrest will emerge.

I hope that things are resolved. I hope that the constitution imposed by the military dictatorship is rewritten from scratch by the people, and that ordinary people can peacefully take back their country from the oligarchs without even more serious violent unrest. I stand with the Australian Chileans in wishing that for their country.

Debate adjourned.

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