Did Milton Friedman really help the Chilean economy to prosper?

This is one of the funniest bits of propaganda the neoliberals, anarcho-capitalists and other market fundamentalists will throw around. It is almost ENTIRELY FALSE. In fact, the only reason anyone believes a “Chilean Miracle” happened at all is because…well…Milton Friedman boasted that it did. Utter hogwash though. Here’s what the consequences of 7 years of Friedman’s policies (recommended by him personally, and by his Chicago Boys to Pinochet) actually were:

1. Unemployment first increased to 14%…then to 20%.

2. Sub-poverty population increased from 20% to 40%.

3. Real wages fell by 20%.

4. National output initially fell by 15% and then only ever leveled out (never got above pre 1970 levels)

5. Per capita GDP grew only 1.5%/year, as compared to several times that nearly everywhere else in Latin America.

6. Well-paying, working-class jobs evaporated (i.e. income disparity increased across population due to a “hole in the middle”)

7. Inflation reduced from 500% to 10% (really the only good thing that happened, economically, as a consequence of neoliberal policies)

8. A handful of folks got rich.

And of course all of these metrics reversed or improved once the neoliberal policies under Pinochet were abandoned….

So basically, Friedman’s “miracle” was to devastate most of the Chilean population.

You’ll notice that I didn’t mention the atrocities of the Pinochet regime - but really, if Milton Friedman was such a “champion” of individual liberty, why didn’t he loudly and soundly criticize Pinochet’s murderous oppression of the Chilean people…? Utter hypocrisy. Even more bizarrely, even as Friedman would insist Chicago School reforms helped the country economically (despite all evidence to the contrary), he would also take credit for Chile’s transition back to democracy, insisting that Chicago School policies were what led to that event. But this is astounding and delusional, really, since that transition was a consequence of pressures from the rest of the military leaders, who continued (yes, even after the referendum) to insulate their power from civilian control. In other words…they just wanted to get rid of Pinochet!

The video below is one of the funniest (or saddest, depending on how you feel about mental illness) snapshots of how Friedman would later try to distance himself from Pinochet while simultaneously taking credit for imaginary “miracles.” Watching it closely we can witness how Friedman’s ego delights in his delusions:


My 2 cents.

From Quora: https://www.quora.com/Did-Milton-Friedman-really-help-the-Chilean-economy-to-prosper


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