The Clairvoyant Post: Pt 1

When people ask what will happen next in Chile, the best response one can give is a distribution of outcomes with their associated probabilities. Because I am a masochist, I will begin with the worst-case scenario. I cannot really quantify the probability of this event, but it increases with each negative external shock such as the coronavirus and the expected resulting recession. I put it in the form of a diary to make it easier to write and more accessible to read. A simple list would have been too boring to write/read. I may have missed a lot of details and nuances, this is merely a rough outline of things. Hopefully the more upbeat scenario will come soon.

Santiago, October 25, 2021

Today was quiet, but canal 13 had a discussion on the upcoming elections. It felt like an empty discussion. Everyone knows that what happened during the plebiscite in April 2020 is bound to happen again. The results of the plebiscite were null and void because even the armed forces could not guard voting stations. After mobs began to attack voters in poorer areas of town with barricades and Molotov cocktails, people were afraid to vote. Soldiers in different locations reacted in wildly different ways. Some responded with extreme violence, actually executing suspected attackers, others were more restrained and were able to maintain order, but by the time calm was restored, it was impossible to convince people to vote. Overall, the majority of those who managed to vote chose a new constitution, but in the end this was a moot point. Given irregularities, the vote could not be counted as legitimate. Everyone agrees that most of the areas with irregularities due to violence would have likely voted yes, but legally the results could not be accepted. I think this is where everything broke down in Chile; the left claims that the government did not want to provide security in areas where “yes” was most likely to win, while the right argues that the left wanted the referendum to fail in order to install a leftist totalitarian regime through force. The simple truth is that the plebiscite broke Chilean state capacity. That break became evident to nearly everyone and it proved the inflection point. After the plebiscite, the government decided to only protect wealthy/business areas since it could no longer afford to spend all of its resources on poorer neighbourhoods. Some very wealthy groups have actually hired ex-army soldiers and ex-police in an effort to create paramilitaries that will protect them. They run around armed but the police do not bother them for two reasons; first they know them personally since most of the paramilitaries are ex police officers, second they relieve them of their duties so that they do not have to put their life on the line. New groups of left wing guerillas attack the paramilitaries often, accusing them of human rights violations and impunity. They are mostly right; we have been stopped by paramilitaries on a number of occasions. They have no legal power, but they still ask for documents and an address. No one dares question their legal right to do so, they can get pretty violent. They can beat you without the slightest provocation mostly to discourage those who don’t belong in rich areas from ever returning.

Citizens in poorer areas are organizing to protect their homes by purchasing firearms. Some areas in La Pintana and Renca are completely run by narcos. They are also heavily involved in the gun trade. Almost all areas west of Providencia are pretty much free of police and if you call, there will be no response. Some apartment complexes have hired armed guards, but this only protects buildings, the streets are taken by thieves and drug dealers.  The equilibrium is pretty simple, the government does not police west of Salvador and the drug dealers do not cross that line either. If you want to open shop, say in Miraflores, someone will eventually come to ask for money for “la lucha”, but it really is just protection money. Graffiti marks shops that have paid up and are not to be touched. Most companies do not deliver to poorer areas of Santiago, and if you want quality products you have to pay a security premium. It is perverse; poorer areas of Santiago are where good products are most expensive. Shop owners do not want to stock them because it makes them targets of theft by roaming narco-funded thieves. In the wealthier suburbs, security is not an issue, you can find anything your heart desires.

Santiago, October 27^th, 2021

Today was particularly violent. Three people were killed in Vitacura by a group of paramilitaries that patrol the area. El Mercurio claims that the three killed were members of the new MIR whose purpose was to kidnap and murder the minister of finance and his family. However, no one really believes this besides the most extreme right. The truth is probably much simpler. Most believe that the dead were likely thieves targeting the area and were killed by the paramilitaries as a warning to others. The police do not usually intervene in these matters both because they do not have the manpower and because it is politically inconvenient. They are aware that paramilitaries have political support from the wealthy citizens that they protect, so it is best not to get in their way. There is usually an official investigation when such incidents occur, but it typically goes nowhere. The head of the paramilitary force, which is called “Los Patriotas de Chile”, was giving an interview on TV tying the dead to “El Nuevo MIR” and making wild claims about Russian and Chinese assets in the country. It feels like an endless cycle of bullshit bombarding the Chilean voter almost without pause. The right claims nefarious forces are financing the left guerilla movements and that their goal is a left wing dictatorship, the left accuses the paramilitaries of operating with impunity beyond the rule of law. But at this point no one really is open to changing his or her mind. The camps are already pretty polarized and the centre is quite empty. There are the occasional voices of reason that try to steer the conversation towards achievable policy goals that are compatible with democratic norms, but they are far and few in between and do not have any followers. The polarization has been thorough and complete. At this point, the political sides tend to shout at each other just to keep their bases happy, I don’t think anyone is interested in dialogue.

We went to downtown Santiago yesterday to visit friends; it was a sad sight. We had not visited in a few months because of insecurity and lack of police presence. We went through the area we used to live in, it is unrecognizable. Most of the restaurants and cafes are gone, replaced by liquor stores with iron bars in their windows and small bodegas that sell junk food and crappy drinks. We first moved to Providencia to avoid the daily barrage of tear gas and destruction that became routine in downtown Santiago, but we had to move further away since Providencia was still too close. Many middle class and upper middle class Santiaguinos moved east, taking with them purchasing power and a taste for intellectual and artistic pursuits. A few years back you could dine in Lastarria, catch a show at GAM and a few drinks in Bellavista afterwards. None of that is possible now, the restaurants in Lastarria are slowly dying from lack of clientele, GAM has not put on a good show in months due to budget cuts and going to Bellavista for a drink is not for the feint of heart; almost everyone I know, from the doorman of my building to the most cuico CEO consider Bellavista no man’s land. You have to have a Che Guevara tattoo to enter the area. A reportage from TVN showed that guerrilla training was going on inside some buildings and that internal fights between different leftist factions were commonplace. The left was up in arms and called it propaganda, but there was enough footage of armed youth and it was impossible to deny the facts on the ground. In fact, the reporter talked to two armed masked gunmen that claimed to have been involved in numerous attacks on the police. The left claimed these were paid actors, and the footage of guns and ammunitions shown in the report were in fact taken from old Colombian footage. The reporter had to flee Chile, her life was actually in danger. The endless cycle of bullshit continues.

Santiago, October 28, 2021

Today two of our few remaining expat friends left Chile for good. It was a Belgian couple that had lived here for nearly 10 years. He was a tenured professor of architecture and she was an entrepreneur, trying to build wave turbines to power coastal cities in Chile. Both had build roots here and were planning to stay for the long haul but it became impossible to stay. Most universities have cut salaries and staff and the job of a professor has become a mix of online classes with minimum student/teacher interaction and the occasional in person teaching with 20% attendance. Universities located in poorer areas of the city are almost empty for fear of attacks. They told us they would have left earlier but it had taken quite some time to sell their apartment in Las Condes. We tried to keep our conversations upbeat, but it was too thin a veneer for the overwhelming and oppressive sense of sadness that permeates everything and everyone in Santiago nowadays.

Santiago, October 30, 2021

I had a short conversation with someone I met at a party last night. It was not really interesting; these conversations never are. But it is typical of conversations I have with people from the Chilean left nowadays.

Me: I think in the next few years Chile will nationalize all resources and enter a period of deep stagnation

X: You’re wrong, nationalization will increase output and reduce inequality

Me: Do you have any evidence?

X: China

Me: If anything China actually refutes your thesis; it only became wealthy when it actually allowed private ownership.

X: I am not talking about plots of land, I am talking about major resources.

Me: Which resources has China nationalized? I am actually curious.

X: Most mining is centrally owned.

Me: It was always centrally owned; it has been partially privatized. You cannot find an example

where some country goes from partially private to fully state-owned, or at least not one that wasn’t a complete disaster.

X: Allende.

I have these conversations often; they tend to veer off into unpleasantness fairly quickly. I don’t really know why Chileans hold on to their group identity for so long. Maybe it has to do with the fact that groups here are more economically important than anywhere else, maybe it has to with the fact that Chileans hold grudges for longer. I don’t really have a good explanation, but I would guess that the average Chilean does not jump ideological camps that often. If you grow in a right wing family, you’re most likely to remain fairly right wing most of your life, ditto for the left. Chileans tend to be quiet about their political positions, until they are no longer quiet. And once they break the barrier, they tend to let it all out.

Someone told me he would have preferred to have grown up in Cuba rather than Chile in the last 30 years. I’ve given up. Mostly we just drink and make bad jokes waiting for the right moment to leave. Occasionally there is some person just as annoyed with this as me, I can sense it. But I don’t usually approach these people. They remind me of the sadness that is knowing an imperfect but clear improvement over any other period of Chilean history is being destroyed in order to be replaced with Colombia circa 1989. It is sad to see, especially something that was clearly on the set of predictable outcomes.

The FA has split into two camps; those agitating for a violent take over and those that still think democracy is worth defending. Most of the main figures of the centre left and centre right have either left the country or have exited public life and are trying hard not to be involved. They tend to only surface when some random attack on them is reported on the news media. The right is financing its own militia (the paramilitaries) and is willing to go along with the status quo. Everyone expects the army to come out on the streets any day now, but neither the president nor the parliament wants to bring them out. The president seems to implicitly understand that the generals would not obey him. They are still pretty angry over the vitriol thrown at the troops during the plebiscite. Those soldiers who intervened and shot rioters were maligned so thoroughly by the media that they don’t leave the barracks now. A mob tried to attack the garrisons where they were stationed, but the army has said that it will shoot on sight anyone who breaches the perimeter, so no one really dares do so. No general wants to really be out on the streets fighting Chileans, so they pretty much stay out of the limelight. Their funding is slowly dwindling and even they will eventually not be able to really do anything about the situation.

Santiago, November 1^st

Today the Immigration Ministry released the latest numbers. Last month was the first time in recent history that Chile experienced a negative net flow. Most Venezuelans with means have gone back. The only immigrants that remain are those without many options back home. The unemployment rate keeps rising, especially for low skilled work and native Chileans are attacking immigrants. There have been incidents in neighbourhoods with heavy Haitian populations. I think at some point in time even the Haitians will leave, the situation for them has become untenable. I have argued that part of the “estallido social” may have been a response to wage pressure at the low end of the skill distribution, but it seems this argument has fallen on dead ears. No one wants to discuss this, it seems fairly taboo among the chattering classes. I am supportive of open borders, but Chile may have been unable to withstand the short term pressure of receiving so many low skilled immigrants in such a short period of time. Sometimes in 2018-2019 the government wanted to attract high-skilled immigrants, but the left nixed that idea as classist. It may have helped, who knows? But at this juncture all of this is a moot point, no one really wants to come here any more. Companies selling security equipment are making a buck, the rest are either trying to hold on to their assets or to sell them and get out. I think it is time to leave, we are waiting to see if the elections will be held without incident, I give that scenario a 20% probability. The OECD wants to send monitors, but they won’t really help with anything.