148-481: General Carlos Ibáñez del Campo ( Latin American Spanish: [ˈkaɾlos iˈβaɲes ðel ˈkampo] ; 3 November 1877 – 28 April 1960) was a Chilean Army officer and political figure . He served as President twice, first between 1927 and 1931, and then from 1952 to 1958, serving for 10 years in office. The presidency of Arturo Alessandri saw a rise in popular discontent over an inefficient government. In 1924,
296-626: A deflationary spiral started in 1931. Farmers faced a worse outlook; declining crop prices and a Great Plains drought crippled their economic outlook. At its peak, the Great Depression saw nearly 10% of all Great Plains farms change hands despite federal assistance. At first, the decline in the U.S. economy was the factor that triggered economic downturns in most other countries due to a decline in trade, capital movement, and global business confidence. Then, internal weaknesses or strengths in each country made conditions worse or better. For example,
444-449: A free market economy that saw an increase in domestic and foreign private investment, although the copper industry and other important mineral resources were not opened to competition. In a plebiscite on 5 October 1988, Pinochet was denied a second eight-year term as president (56% against 44%). Chileans elected a new president and the majority of members of a bicameral congress on 14 December 1989. Christian Democrat Patricio Aylwin ,
592-480: A military junta . However, another faction of the armed forces, led by Colonel Marmaduke Grove and Lieutenant Colonel Ibáñez, decided the junta's reforms did not go far enough in ending the government's inefficiency. They led another coup, deposed Altamirano, and established a new junta with Emilio Bello Codesido as head. Ibáñez and Grove, the powers behind the scene, agreed to ask Alessandri to return and complete his term. Alessandri returned in 1925 and drafted
740-645: A national referendum in April 2020 regarding the creation of a new Constitution, later postponed to October due to the COVID-19 pandemic . On 25 October 2020, Chileans voted 78.28 per cent in favor of a new constitution, while 21.72 per cent rejected the change. Voter turnout was 51 percent. An election for the members of the Constitutional Convention was held in Chile between 15 and 16 May 2021. On 19 December 2021,
888-578: A parliamentary style democracy. However, the Civil War had also been a contest between those who favored the development of local industries and powerful Chilean banking interests, particularly the House of Edwards which had strong ties to foreign investors. Soon after, the country engaged in a vastly expensive naval arms race with Argentina that nearly led to war, as well because of the Puna de Atacama dispute . After
1036-558: A plurality of votes in a three-way contest, followed by candidates Radomiro Tomic for the Christian Democrat Party and Jorge Alessandri for the Conservative Party. Allende was not elected with an absolute majority, receiving fewer than 35% of the votes. The Chilean Congress conducted a runoff vote between the leading candidates, Allende and former president Jorge Alessandri, and, keeping with tradition, chose Allende by
1184-418: A silver standard , almost avoided the depression entirely. The connection between leaving the gold standard as a strong predictor of that country's severity of its depression and the length of time of its recovery has been shown to be consistent for dozens of countries, including developing countries . This partly explains why the experience and length of the depression differed between regions and states around
1332-614: A campaign of domestic political and economical destabilization, some of which was backed by the United States. By early 1973, inflation was out of control. On 26 May 1973, Chile's Supreme Court, which was opposed to Allende's government, unanimously denounced Allende's disruption of the legality of the nation . Although illegal under the Chilean constitution, the court supported and strengthened Pinochet's soon-to-be seizure of power. A military coup overthrew Allende on 11 September 1973. As
1480-438: A comeback. After a great wave of public unrest, Ibáñez left the country for exile, on 26 July 1931, after delegating his office to the president of the senate, Pedro Opazo , who in turn resigned in favor of the interior minister, Juan Esteban Montero . Chile did not reach political stability until the 1932 reelection of Arturo Alessandri, whose economic policies managed to alleviate the depression. He ran for president again in
1628-588: A former privately run bank, bearing no relation to the U.S. government (not to be confused with the Federal Reserve ). Unable to pay out to all of its creditors, the bank failed. Among the 608 American banks that closed in November and December 1930, the Bank of United States accounted for a third of the total $ 550 million deposits lost and, with its closure, bank failures reached a critical mass. In an initial response to
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#17330857502261776-459: A greater reduction in credit. On 5 April 1933, President Roosevelt signed Executive Order 6102 making the private ownership of gold certificates , coins and bullion illegal, reducing the pressure on Federal Reserve gold. British economist John Maynard Keynes argued in The General Theory of Employment, Interest and Money that lower aggregate expenditures in the economy contributed to
1924-469: A large variety of climates and landscapes. It contains 756,950 square kilometers (292,260 sq mi) of land area. It is situated within the Pacific Ring of Fire . Excluding its Pacific islands and Antarctic claim, Chile lies between latitudes 17° and 56°S , and longitudes 66° and 75°W . Chile is among the longest north–south countries in the world. If one considers only mainland territory, Chile
2072-414: A leftist candidate, the 35-year-old former student protest leader Gabriel Boric , won Chile's presidential election to become the country's youngest ever leader. On 11 March 2022, Boric was sworn in as president to succeed outgoing President Sebastian Piñera. Out of 24 members of Gabriel Boric's female-majority Cabinet, 14 are women. On 4 September 2022, voters rejected the new constitution proposal in
2220-572: A letter dated 12 November 1821, expressing his plan to conquer Guayaquil , the Galapagos Islands , and the Philippines . There were preparations, but the plan did not push through because O'Higgins was exiled. Chile slowly started to expand its influence and to establish its borders. By the Tantauco Treaty, the archipelago of Chiloé was incorporated in 1826. The economy began to boom due to
2368-402: A ministerial office. Ibáñez promised to "sweep" out political corruption and bad government with his "broom" and was nicknamed the "General of Hope". He criticized traditional political parties but was vague in his proposals and had no clear position in the political spectrum. He won the election with 47%. The Bolivian National Revolution of 1952 influenced the followers of Ibáñez who saw it as
2516-463: A model of the national-populism they sought to implement in Chile. His second term was a very modest success. By that time he was already old and ailing, and he left government mostly to his cabinet. His major problems during his presidency were those concerned with the economy. He had no plan to control inflation – one of the most pressing economic problems at the time in Chile – and as a result it skyrocketed to 71% in 1954 and 83% in 1955. Helped by
2664-596: A modern industrial city handled shortages of money and resources. Often they updated strategies their mothers used when they were growing up in poor families. Cheap foods were used, such as soups, beans and noodles. They purchased the cheapest cuts of meat—sometimes even horse meat—and recycled the Sunday roast into sandwiches and soups. They sewed and patched clothing, traded with their neighbors for outgrown items, and made do with colder homes. New furniture and appliances were postponed until better days. Many women also worked outside
2812-402: A monetary contraction first-hand were forced to join the deflationary policy since higher interest rates in countries that performed a deflationary policy led to a gold outflow in countries with lower interest rates. Under the gold standard's price–specie flow mechanism , countries that lost gold but nevertheless wanted to maintain the gold standard had to permit their money supply to decrease and
2960-400: A new constitution which was designed to decrease the powers of the legislature, thereby making government more effective. Ibáñez was named Minister of War and later Home Affairs Minister. However, Alessandri decided Ibáñez was becoming too ambitious, and many ridiculed Alessandri as a pawn of Ibáñez. In response, Alessandri resigned once more and went into exile. Ibáñez announced his candidacy in
3108-540: A period of almost 24 hours, an effort that was carried on live television around the world. 2019–20 Chilean protests are a series of country-wide protests in response to a rise in the Santiago Metro 's subway fare, the increased cost of living , privatization and inequality prevalent in the country. On 15 November, most of the political parties represented in the National Congress signed an agreement to call
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#17330857502263256-527: A period of major reform. Under the slogan "Revolution in Liberty", the Frei administration embarked on far-reaching social and economic programs, particularly in education, housing, and agrarian reform , including rural unionization of agricultural workers. By 1967, however, Frei encountered increasing opposition from leftists, who charged that his reforms were inadequate, and from conservatives, who found them excessive. At
3404-694: A prolonged struggle, including infighting from Bernardo O'Higgins , who challenged Carrera's leadership. Intermittent warfare continued until 1817. With Carrera in prison in Argentina, O'Higgins and anti-Carrera cohort José de San Martín , hero of the Argentine War of Independence , led an army that crossed the Andes into Chile and defeated the royalists. On 12 February 1818, Chile was proclaimed an independent republic . The political revolt brought little social change, however, and 19th-century Chilean society preserved
3552-490: A reformist president, Arturo Alessandri , whose program was frustrated by a conservative congress. In the 1920s, Marxist groups with strong popular support arose. A military coup led by General Luis Altamirano in 1924 set off a period of political instability that lasted until 1932. Of the ten governments that held power in that period, the longest lasting was that of General Carlos Ibáñez del Campo , who briefly held power in 1925 and then again between 1927 and 1931 in what
3700-563: A serious issue in the 1930s. Support for increasing welfare programs during the depression included a focus on women in the family. The Conseil Supérieur de la Natalité campaigned for provisions enacted in the Code de la Famille (1939) that increased state assistance to families with children and required employers to protect the jobs of fathers, even if they were immigrants. In rural and small-town areas, women expanded their operation of vegetable gardens to include as much food production as possible. In
3848-474: A small cadre of Labour, but the vast majority of Labour leaders denounced MacDonald as a traitor for leading the new government. Britain went off the gold standard , and suffered relatively less than other major countries in the Great Depression. In the 1931 British election, the Labour Party was virtually destroyed, leaving MacDonald as prime minister for a largely Conservative coalition. In most countries of
3996-699: A standstill agreement froze Germany's foreign liabilities for six months. Germany received emergency funding from private banks in New York as well as the Bank of International Settlements and the Bank of England. The funding only slowed the process. Industrial failures began in Germany, a major bank closed in July and a two-day holiday for all German banks was declared. Business failures were more frequent in July, and spread to Romania and Hungary. The crisis continued to get worse in Germany, bringing political upheaval that finally led to
4144-731: A vote of 153 to 35. Frei refused to form an alliance with Alessandri to oppose Allende, on the grounds that the Christian Democrats were a workers' party and could not make common cause with the right wing. An economic depression that began in 1972 was exacerbated by capital flight , plummeting private investment, and withdrawal of bank deposits in response to Allende's socialist program. Production fell and unemployment rose. Allende adopted measures including price freezes, wage increases, and tax reforms, to increase consumer spending and redistribute income downward. Joint public-private public works projects helped reduce unemployment. Much of
4292-515: Is Santiago , and the national language is Spanish . Spain conquered and colonized the region in the mid-16th century, replacing Inca rule , but failed to conquer the independent Mapuche people who inhabited what is now south-central Chile. Chile emerged as a relatively stable authoritarian republic in the 1830s after their 1818 declaration of independence from Spain . During the 19th century, Chile experienced significant economic and territorial growth, putting an end to Mapuche resistance in
4440-642: Is a consensus that the Federal Reserve System should have cut short the process of monetary deflation and banking collapse, by expanding the money supply and acting as lender of last resort . If they had done this, the economic downturn would have been far less severe and much shorter. Modern mainstream economists see the reasons in Insufficient spending, the money supply reduction, and debt on margin led to falling prices and further bankruptcies ( Irving Fisher 's debt deflation). The monetarist explanation
4588-430: Is also the historical center from which Chile expanded in the late 19th century when it integrated the northern and southern regions. Southern Chile is rich in forests, grazing lands, and features a string of volcanoes and lakes. The southern coast is a labyrinth of fjords, inlets, canals, twisting peninsulas, and islands. The Andes Mountains are located on the eastern border. Great Depression The Great Depression
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4736-430: Is now Chile. The next Europeans to reach Chile were Diego de Almagro and his band of Spanish conquistadors , who came from Peru in 1535 seeking gold. The Spanish encountered various cultures that supported themselves principally through slash-and-burn agriculture and hunting. The conquest of Chile began in earnest in 1540 and was carried out by Pedro de Valdivia , one of Francisco Pizarro 's lieutenants, who founded
4884-652: Is present-day Chile. Settlement sites from very early human habitation include Monte Verde, Cueva del Milodón and the Pali-Aike Crater 's lava tube . The Incas briefly extended their empire into what is now northern Chile, but the Mapuche (or Araucanians as they were known by the Spaniards) successfully resisted many attempts by the Inca Empire to subjugate them, despite their lack of state organization. They fought against
5032-493: Is supported by the contrast in how the crisis progressed in, e.g., Britain, Argentina and Brazil, all of which devalued their currencies early and returned to normal patterns of growth relatively rapidly and countries which stuck to the gold standard , such as France or Belgium. Frantic attempts by individual countries to shore up their economies through protectionist policies – such as the 1930 U.S. Smoot–Hawley Tariff Act and retaliatory tariffs in other countries – exacerbated
5180-601: Is suspended under the terms of the Antarctic Treaty , of which Chile is a signatory. It is the world's southernmost country that is geographically on the mainland. Chile controls Easter Island and Sala y Gómez Island, the easternmost islands of Polynesia, which it incorporated to its territory in 1888, and the Juan Fernández Islands , more than 600 km (370 mi) from the mainland. Also controlled but only temporarily inhabited (by some local fishermen) are
5328-405: Is unique within this group in its narrowness from east to west, with the other long north–south countries (including Brazil, Russia, Canada, and the United States, among others) all being wider from east to west by a factor of more than 10. Chile also claims 1,250,000 km (480,000 sq mi) of Antarctica as part of its territory ( Chilean Antarctic Territory ). However, this latter claim
5476-523: The 1932 election , Hoover was defeated by Franklin D. Roosevelt , who from 1933 pursued a series of " New Deal " policies and programs to provide relief and create jobs, including the Civilian Conservation Corps , Federal Emergency Relief Administration , Tennessee Valley Authority , and Works Progress Administration . Historians disagree on the effects of the New Deal, with some claiming that
5624-401: The 1942 election , but lost to Juan Antonio Rios . In the 1952 presidential elections , the right-wing Agrarian Labor Party ( Partido Agrario Laborista ) declared Ibáñez a presidential candidate. Ibáñez also garnered the support of the left-wing Popular Socialist Party and some feminist political unions — the feminist María de la Cruz was his campaign manager, but she then refused
5772-657: The Klein-Sacks mission, Ibáñez managed to reduce it to 33% when he left the presidency. During his term, public transport costs rose by 50% and economic growth fell to 2.5%. Now much more of a centrist politically, Ibáñez won the support of many left-wingers by repealing the Law for the Defense of Democracy , which banned the Communist Party . He did also take a softer approach on crime than in his first presidency. For example, he commuted
5920-508: The Maule river in 1812, but did not include the indigenous population or the inhabitants of the province of Chiloé. The population is estimated at 210,567, 86.1% of whom were Spanish or of European descent, 10% of whom were indigenous and 3.7% of whom were mestizos, blacks and mulattos . A 2021 study by Baten and Llorca-Jaña shows that regions with a relatively high share of North European migrants developed faster in terms of numeracy , even if
6068-565: The New York Bank of United States – which produced panic and widespread runs on local banks, and the Federal Reserve sat idly by while banks collapsed. Friedman and Schwartz argued that, if the Fed had provided emergency lending to these key banks, or simply bought government bonds on the open market to provide liquidity and increase the quantity of money after the key banks fell, all the rest of
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6216-690: The Pacific Alliance , and joined the OECD in 2010. There are various theories about the origin of the word Chile . According to 17th-century Spanish chronicler Diego de Rosales , the Incas called the valley of the Aconcagua Chili by corruption of the name of a Picunche tribal chief ( cacique ) called Tili , who ruled the area at the time of the Incan conquest in the 15th century. Another theory points to
6364-587: The Republic of Chile , is a country in western South America . It is the southernmost country in the world and the closest to Antarctica , stretching along a narrow strip of land between the Andes Mountains and the Pacific Ocean . Chile had a population of 17.5 million as of the latest census in 2017 and has a territorial area of 756,102 square kilometers (291,933 sq mi), sharing borders with Peru to
6512-712: The Tacna Province to Peru , which had been seized during the War of the Pacific . His popularity lasted until after the Wall Street Crash of 1929 . At that point all loans were halted and called. Without the influx of foreign currency, Chile was heavily affected by the Great Depression . Ibáñez's large public spending did nothing to alleviate the situation, and his opponents, primarily the exiled Grove and Alessandri, began to plan
6660-525: The coming to power of Hitler's Nazi regime in January 1933. The world financial crisis now began to overwhelm Britain; investors around the world started withdrawing their gold from London at the rate of £2.5 million per day. Credits of £25 million each from the Bank of France and the Federal Reserve Bank of New York and an issue of £15 million fiduciary note slowed, but did not reverse,
6808-640: The constitutional referendum , which was put forward by the left-leaning Constitutional Convention . On 17 December 2023, voters rejected a second new constitution proposal in a new constitutional referendum , written by the conservative-led Constitutional Council . A long and narrow coastal Southern Cone country on the west side of the Andes Mountains , Chile stretches over 4,300 km (2,670 mi) north to south, but only 350 km (217 mi) at its widest point east to west and 64 km (40 mi) at its narrowest point east to west, with an average width of 175 km (109 mi). This encompasses
6956-480: The upcoming presidential elections , but the three main Chilean political parties ( Conservative , Liberal , Radical ) pressured him to desist. The three parties then presented a consensus choice, Emiliano Figueroa Larraín , to be the sole presidential candidate, in order to avoid political campaigning in the volatile political atmosphere. Nevertheless, Ibáñez's closest adviser, leftist José Santos Salas , later declared his presidential candidacy, and many suspected it
7104-399: The 1880s and gaining its current northern territory in the War of the Pacific (1879–83) by defeating Peru and Bolivia. In the 20th century, up until the 1970s, Chile underwent a process of democratization and experienced rapid population growth and urbanization , while relying increasingly on exports from copper mining to support its economy . During the 1960s and 1970s, the country
7252-447: The 1937 recession that interrupted it). The common view among most economists is that Roosevelt's New Deal policies either caused or accelerated the recovery, although his policies were never aggressive enough to bring the economy completely out of recession. Some economists have also called attention to the positive effects from expectations of reflation and rising nominal interest rates that Roosevelt's words and actions portended. It
7400-795: The British crisis. The financial crisis now caused a major political crisis in Britain in August 1931. With deficits mounting, the bankers demanded a balanced budget; the divided cabinet of Prime Minister Ramsay MacDonald's Labour government agreed; it proposed to raise taxes, cut spending, and most controversially, to cut unemployment benefits 20%. The attack on welfare was unacceptable to the Labour movement. MacDonald wanted to resign, but King George V insisted he remain and form an all-party coalition " National Government ". The Conservative and Liberals parties signed on, along with
7548-463: The Chilean armed forces, led by General Luis Altamirano , began the saber-rattling ( ruido de sables ), a protest where soldiers banged their sabers against the floor of the Congress. Amid threats from the armed forces, Alessandri decided he could no longer govern and submitted his resignation. Although this resignation was not approved by Congress, Alessandri left the country and Altamirano established
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#17330857502267696-442: The Chilean political scene (during which he often appeared to have little actual sympathy with the political goals of the groups that supported him at various times, e.g. he was too moderate to agree with the nacistas and too respectful of existing institutions to emulate Peronism successfully) produced its most significant results in the early years of his caretaker presidency in the 1920s through his efforts to develop new towns in
7844-542: The December 2017 presidential election . On 27 February 2010, Chile was struck by an 8.8 M w earthquake , the fifth largest ever recorded at the time. More than 500 people died (most from the ensuing tsunami ) and over a million people lost their homes. The earthquake was also followed by multiple aftershocks. Initial damage estimates were in the range of US$ 15–30 billion, around 10% to 15% of Chile's real gross domestic product. Chile achieved global recognition for
7992-517: The Depression. Businessmen ignored the mounting national debt and heavy new taxes, redoubling their efforts for greater output to take advantage of generous government contracts. During World War I many countries suspended their gold standard in varying ways. There was high inflation from WWI, and in the 1920s in the Weimar Republic , Austria , and throughout Europe. In the late 1920s there
8140-466: The Dow returning to 294 (pre-depression levels) in April 1930, before steadily declining for years, to a low of 41 in 1932. At the beginning, governments and businesses spent more in the first half of 1930 than in the corresponding period of the previous year. On the other hand, consumers, many of whom suffered severe losses in the stock market the previous year, cut expenditures by 10%. In addition, beginning in
8288-552: The Earth". Another origin attributed to chilli is the onomatopoeic cheele-cheele —the Mapuche imitation of the warble of a bird locally known as trile . The Spanish conquistadors heard about this name from the Incas, and the few survivors of Diego de Almagro 's first Spanish expedition south from Peru in 1535–36 called themselves the "men of Chilli". Ultimately, Almagro is credited with
8436-480: The Federal Reserve did not act to limit the decline of the money supply was the gold standard . At that time, the amount of credit the Federal Reserve could issue was limited by the Federal Reserve Act , which required 40% gold backing of Federal Reserve Notes issued. By the late 1920s, the Federal Reserve had almost hit the limit of allowable credit that could be backed by the gold in its possession. This credit
8584-442: The Great Depression is right, or the traditional Keynesian explanation that a fall in autonomous spending, particularly investment, is the primary explanation for the onset of the Great Depression. Today there is also significant academic support for the debt deflation theory and the expectations hypothesis that – building on the monetary explanation of Milton Friedman and Anna Schwartz – add non-monetary explanations. There
8732-639: The Great Depression. According to the U.S. Senate website, the Smoot–Hawley Tariff Act is among the most catastrophic acts in congressional history. Many economists have argued that the sharp decline in international trade after 1930 helped to worsen the depression, especially for countries significantly dependent on foreign trade. Most historians and economists blame the Act for worsening the depression by seriously reducing international trade and causing retaliatory tariffs in other countries. While foreign trade
8880-540: The Ibáñez administration when the press revealed Ibáñez's meetings with these conspirators. Ibáñez was succeeded by Jorge Alessandri Rodriguez , the son of his archenemy Arturo Alessandri. He abandoned politics and died in Santiago in 1960. As a result of Ibañez's nebulous and vacillating political ideology, he left no intellectual legacy to Chilean politics. His long and often poorly defined presence of more than thirty years on
9028-473: The New Deal prolonged the Great Depression, as they argue that National Industrial Recovery Act of 1933 and National Labor Relations Act of 1935 restricted competition and established price fixing. John Maynard Keynes did not think that the New Deal under Roosevelt single-handedly ended the Great Depression: "It is, it seems, politically impossible for a capitalistic democracy to organize expenditure on
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#17330857502269176-813: The Popular Unity platform also called for nationalization of Chile's major copper mines in the form of a constitutional amendment. The measure was passed unanimously by Congress. As a result, the Richard Nixon administration organized and inserted secret operatives in Chile, in order to swiftly destabilize Allende's government. In addition, US financial pressure restricted international economic credit to Chile. The economic problems were also exacerbated by Allende's public spending, financed mostly through printing money, and by poor credit ratings given by commercial banks. Simultaneously, opposition media, politicians, business guilds and other organizations helped to accelerate
9324-678: The Sapa Inca Tupac Yupanqui and his army. The result of the bloody three-day confrontation known as the Battle of the Maule was that the Inca conquest of the territories of Chile ended at the Maule river . In 1520, while attempting to circumnavigate the globe, Ferdinand Magellan discovered the southern passage now named after him (the Strait of Magellan ) thus becoming the first European to set foot on what
9472-522: The Spanish monarchy (in memory of this day, Chile celebrates its National Day on 18 September each year). After these events, a movement for total independence, under the command of José Miguel Carrera (one of the most renowned patriots) and his two brothers Juan José and Luis Carrera , soon gained a wider following. Spanish attempts to re-impose arbitrary rule during what was called the Reconquista led to
9620-540: The U.K. economy, which experienced an economic downturn throughout most of the late 1920s, was less severely impacted by the shock of the depression than the U.S. By contrast, the German economy saw a similar decline in industrial output as that observed in the U.S. Some economic historians attribute the differences in the rates of recovery and relative severity of the economic decline to whether particular countries had been able to effectively devaluate their currencies or not. This
9768-485: The U.S. unemployment rate down below 10%. World War II had a dramatic effect on many parts of the American economy. Government-financed capital spending accounted for only 5% of the annual U.S. investment in industrial capital in 1940; by 1943, the government accounted for 67% of U.S. capital investment. The massive war spending doubled economic growth rates, either masking the effects of the Depression or essentially ending
9916-622: The United States, agricultural organizations sponsored programs to teach housewives how to optimize their gardens and to raise poultry for meat and eggs. Rural women made feed sack dresses and other items for themselves and their families and homes from feed sacks. In American cities, African American women quiltmakers enlarged their activities, promoted collaboration, and trained neophytes. Quilts were created for practical use from various inexpensive materials and increased social interaction for women and promoted camaraderie and personal fulfillment. Oral history provides evidence for how housewives in
10064-543: The United States, remained on the gold standard into 1932 or 1933, while a few countries in the so-called "gold bloc", led by France and including Poland, Belgium and Switzerland, stayed on the standard until 1935–36. According to later analysis, the earliness with which a country left the gold standard reliably predicted its economic recovery. For example, The UK and Scandinavia, which left the gold standard in 1931, recovered much earlier than France and Belgium, which remained on gold much longer. Countries such as China, which had
10212-632: The Wall Street crash, after which the slide continued for three years, which was accompanied by a loss of confidence in the financial system. By 1933, the U.S. unemployment rate had risen to 25 percent, about one-third of farmers had lost their land, and about half of the country's 25,000 banks had gone out of business. Many people, unable to pay mortgages or rent, became homeless and relied on begging or charities to feed themselves. The U.S. federal government initially did little to help. President Herbert Hoover , like many of his fellow Republicans , believed in
10360-692: The War of the Pacific, Chile became a Naval Power in the Americas, even sending a ship in protests in the Panama crisis of 1885 against the United States intervention in the then Colombian territory. The United States and Chile had the Baltimore crisis which almost became a war as Chile was a potential threat to the intentions of hegemony from the United States in the Western Hemisphere. In 1902 Chile and Argentina received
10508-470: The armed forces bombarded the presidential palace , Allende apparently committed suicide. After the coup, Henry Kissinger told U.S. president Richard Nixon that the United States had "helped" the coup. In 1970, when Allende was first elected, Henry Kissinger had stated "I don't see why we need to stand by and watch a country go Communist due to the irresponsibility of its own people". A military junta, led by General Augusto Pinochet , took control of
10656-621: The banking sector was nationalized . Many enterprises within the copper , coal, iron, nitrate , and steel industries were expropriated , nationalized, or subjected to state intervention. Industrial output increased sharply and unemployment fell during the Allende administration's first year. Allende's program included advancement of workers' interests, replacing the judicial system with "socialist legality", nationalization of banks and forcing others to bankruptcy, and strengthening "popular militias" known as MIR. Started under former President Frei,
10804-455: The banks would not have fallen after the large ones did, and the money supply would not have fallen as far and as fast as it did. With significantly less money to go around, businesses could not get new loans and could not even get their old loans renewed, forcing many to stop investing. This interpretation blames the Federal Reserve for inaction, especially the New York branch . One reason why
10952-573: The beginning of the Depression. The Depression was preceded by a period of industrial growth and social development known as the " Roaring Twenties ". Much of the profit generated by the boom was invested in speculation , such as on the stock market , which resulted in growing wealth inequality . Banks were subject to minimal regulation under laissez-faire economic policies, resulting in loose lending and widespread debt. By 1929, declining spending had led to reductions in manufacturing output and rising unemployment . Share values continued to rise until
11100-465: The behavior of housewives. The common view among economic historians is that the Great Depression ended with the advent of World War II . Many economists believe that government spending on the war caused or at least accelerated recovery from the Great Depression, though some consider that it did not play a very large role in the recovery, though it did help in reducing unemployment. The rearmament policies leading up to World War II helped stimulate
11248-543: The candidate of a coalition of 17 political parties called the Concertación , received an absolute majority of votes (55%). President Aylwin served from 1990 to 1994, in what was considered a transition period. In December 1993, Christian Democrat Eduardo Frei Ruiz-Tagle , the son of previous president Eduardo Frei Montalva, led the Concertación coalition to victory with an absolute majority of votes (58%). Frei Ruiz-Tagle
11396-559: The city of Santiago on 12 February 1541. Although the Spanish did not find the extensive gold and silver they sought, they recognized the agricultural potential of Chile's central valley, and Chile became part of the Spanish Empire . Conquest took place gradually, and the Europeans suffered repeated setbacks. A massive Mapuche insurrection that began in 1553 resulted in Valdivia's death and
11544-458: The collapse in global trade, contributing to the depression. By 1933, the economic decline pushed world trade to one third of its level compared to four years earlier. While the precise causes for the occurrence of the Great depression are disputed and can be traced to both global and national phenomena, its immediate origins are most conveniently examined in the context of the U.S. economy, from which
11692-506: The colony in addition to the Mapuche, as was shown by Sir Francis Drake 's 1578 raid on Valparaíso, the colony's principal port. Chile hosted one of the largest standing armies in the Americas, making it one of the most militarized of the Spanish possessions, as well as a drain on the treasury of the Viceroyalty of Peru . The first general census was conducted by the government of Agustín de Jáuregui between 1777 and 1778; it indicated that
11840-730: The command of John Williams Wilson , the Magallanes Region started to be controlled by country in 1843 , while the Antofagasta Region , at the time in dispute with Bolivia , began to fill with people. After the Chilean Civil War of 1829–1830 in which the conservatives won, under the Joaquín Prieto Administration, the Chilean Constitution of 1833 was written and put into effect with high influence from
11988-408: The country to renounce to its claims in the rest of East Patagonia after a dispute that started in 1842 . As a result of the War of the Pacific with Peru and Bolivia (1879–83), Chile expanded its territory northward by almost one-third, eliminating Bolivia's access to the Pacific, and acquired valuable nitrate deposits, the exploitation of which led to an era of national affluence. Chile had joined
12136-782: The country, several hundred committed Chilean revolutionaries joined the Sandinista army in Nicaragua , guerrilla forces in Argentina or training camps in Cuba , Eastern Europe and Northern Africa. In the late 1980s, largely as a result of events such as the 1982 economic collapse and mass civil resistance in 1983–88, the government gradually permitted greater freedom of assembly, speech , and association, to include trade union and political activity. The government launched market-oriented reforms with Hernán Büchi as Minister of Finance. Chile moved toward
12284-608: The country. The years of the regime were marked by human rights violations . Chile actively participated in Operation Condor . In October 1973, at least 72 people were murdered by the Caravan of Death . According to the Rettig Report and Valech Commission , at least 2,115 were killed, and at least 27,265 were tortured (including 88 children younger than 12 years old). In 2011, Chile recognized an additional 9,800 victims, bringing
12432-475: The crash was a mere symptom of more general economic trends of the time, which had already been underway in the late 1920s. A contrasting set of views, which rose to prominence in the later part of the 20th century, ascribes a more prominent role to failures of monetary policy . According to those authors, while general economic trends can explain the emergence of the downturn, they fail to account for its severity and longevity; they argue that these were caused by
12580-620: The crisis, the U.S. Congress passed the Smoot–Hawley Tariff Act on 17 June 1930. The Act was ostensibly aimed at protecting the American economy from foreign competition by imposing high tariffs on foreign imports. The consensus view among economists and economic historians (including Keynesians , Monetarists and Austrian economists ) is that the passage of the Smoot–Hawley Tariff had, in fact, achieved an opposite effect to what
12728-403: The death sentence for The Jackal of Pupunahue to life imprisonment . Some Chileans continued to support an Ibáñez dictatorship. These ibañistas , most of whom were retired army officers, created the "Línea Recta" (Straight Line) group to establish a new dictatorship. Ibáñez met with these conspirators, but ultimately his typical lack of trust ended the plans for a self-coup . A scandal rocked
12876-633: The decade. The Depression had devastating economic effects on both wealthy and poor countries: all experienced drops in personal income , prices ( deflation ), tax revenues, and profits. International trade fell by more than 50%, and unemployment in some countries rose as high as 33%. Cities around the world , especially those dependent on heavy industry , were heavily affected. Construction virtually halted in many countries, and farming communities and rural areas suffered as crop prices fell by up to 60%. Faced with plummeting demand and few job alternatives, areas dependent on primary sector industries suffered
13024-408: The depression. Not all governments enforced the same measures of protectionism. Some countries raised tariffs drastically and enforced severe restrictions on foreign exchange transactions, while other countries reduced "trade and exchange restrictions only marginally": The gold standard was the primary transmission mechanism of the Great Depression. Even countries that did not face bank failures and
13172-520: The destruction of many of the colony's principal settlements. Subsequent major insurrections took place in 1598 and in 1655. Each time the Mapuche and other native groups revolted, the southern border of the colony was driven northward. The abolition of slavery by the Spanish crown in 1683 was done in recognition that enslaving the Mapuche intensified resistance rather than cowing them into submission. Despite royal prohibitions, relations remained strained from continual colonialist interference. Cut off to
13320-525: The discovery of silver ore in Chañarcillo, and the growing trade of the port of Valparaíso, which led to conflict over maritime supremacy in the Pacific with Peru. At the same time, attempts were made to strengthen sovereignty in southern Chile intensifying penetration into Araucanía and colonizing Llanquihue with German immigrants in 1848. Through the founding of Fort Bulnes by the Schooner Ancud under
13468-435: The domestic price level to decline ( deflation ). There is also consensus that protectionist policies, and primarily the passage of the Smoot–Hawley Tariff Act , helped to exacerbate, or even cause the Great Depression. Some economic studies have indicated that the rigidities of the gold standard not only spread the downturn worldwide, but also suspended gold convertibility (devaluing the currency in gold terms) that did
13616-402: The drop in demand. Monetarists believe that the Great Depression started as an ordinary recession, but the shrinking of the money supply greatly exacerbated the economic situation, causing a recession to descend into the Great Depression. Economists and economic historians are almost evenly split as to whether the traditional monetary explanation that monetary forces were the primary cause of
13764-427: The economies of Europe in 1937–1939. By 1937, unemployment in Britain had fallen to 1.5 million. The mobilization of manpower following the outbreak of war in 1939 ended unemployment. The American mobilization for World War II at the end of 1941 moved approximately ten million people out of the civilian labor force and into the war. This finally eliminated the last effects from the Great Depression and brought
13912-658: The end of his term, Frei had not fully achieved his party's ambitious goals. In the 1970 election, Senator Salvador Allende of the Socialist Party of Chile (then part of the " Popular Unity " coalition which included the Communists, Radicals, Social-Democrats, dissident Christian Democrats, the Popular Unitary Action Movement, and the Independent Popular Action), achieved a partial majority in
14060-576: The end of the month. A large sell-off of stocks began in mid-October. Finally, on 24 October, Black Thursday , the American stock market crashed 11% at the opening bell. Actions to stabilize the market failed, and on 28 October, Black Monday, the market crashed another 12%. The panic peaked the next day on Black Tuesday, when the market saw another 11% drop. Thousands of investors were ruined, and billions of dollars had been lost; many stocks could not be sold at any price. The market recovered 12% on Wednesday but by then significant damage had been done. Though
14208-534: The essence of the stratified colonial social structure, which was greatly influenced by family politics and the Roman Catholic Church . A strong presidency eventually emerged, but wealthy landowners remained powerful. Bernardo O'Higgins once planned to expand Chile by liberating the Philippines from Spain and incorporating the islands. In this regard he tasked the Scottish naval officer, Lord Thomas Cochrane, in
14356-494: The explanations of the Keynesians and monetarists. The consensus among demand-driven theories is that a large-scale loss of confidence led to a sudden reduction in consumption and investment spending. Once panic and deflation set in, many people believed they could avoid further losses by keeping clear of the markets. Holding money became profitable as prices dropped lower and a given amount of money bought ever more goods, exacerbating
14504-503: The few women in the labor force, layoffs were less common in the white-collar jobs and they were typically found in light manufacturing work. However, there was a widespread demand to limit families to one paid job, so that wives might lose employment if their husband was employed. Across Britain, there was a tendency for married women to join the labor force, competing for part-time jobs especially. In France, very slow population growth, especially in comparison to Germany continued to be
14652-631: The first rightist President in 20 years, defeating former President Eduardo Frei Ruiz-Tagle of the Concertación , for a four-year term succeeding Bachelet. Due to term limits, Sebastián Piñera did not stand for re-election in 2013, and his term expired in March 2014 resulting in Michelle Bachelet returning to office. Sebastián Piñera succeeded Bachelet again in 2018 as the President of Chile after winning
14800-501: The first week of June, 540 million in the second, and 150 million in two days, 19–20 June. Collapse was at hand. U.S. President Herbert Hoover called for a moratorium on payment of war reparations . This angered Paris, which depended on a steady flow of German payments, but it slowed the crisis down, and the moratorium was agreed to in July 1931. An International conference in London later in July produced no agreements but on 19 August
14948-599: The government tried to reshape private household consumption under the Four-Year Plan of 1936 to achieve German economic self-sufficiency. The Nazi women's organizations, other propaganda agencies and the authorities all attempted to shape such consumption as economic self-sufficiency was needed to prepare for and to sustain the coming war. The organizations, propaganda agencies and authorities employed slogans that called up traditional values of thrift and healthy living. However, these efforts were only partly successful in changing
15096-519: The home, or took boarders, did laundry for trade or cash, and did sewing for neighbors in exchange for something they could offer. Extended families used mutual aid—extra food, spare rooms, repair-work, cash loans—to help cousins and in-laws. In Japan, official government policy was deflationary and the opposite of Keynesian spending. Consequently, the government launched a campaign across the country to induce households to reduce their consumption, focusing attention on spending by housewives. In Germany,
15244-514: The initial crisis spread to the rest of the world. In the aftermath of World War I , the Roaring Twenties brought considerable wealth to the United States and Western Europe. Initially, the year 1929 dawned with good economic prospects: despite a minor crash on 25 March 1929, the market seemed to gradually improve through September. Stock prices began to slump in September, and were volatile at
15392-484: The lack of an adequate response to the crises of liquidity that followed the initial economic shock of 1929 and the subsequent bank failures accompanied by a general collapse of the financial markets. After the Wall Street Crash of 1929 , when the Dow Jones Industrial Average dropped from 381 to 198 over the course of two months, optimism persisted for some time. The stock market rose in early 1930, with
15540-461: The market entered a period of recovery from 14 November until 17 April 1930, the general situation had been a prolonged slump. From 17 April 1930 until 8 July 1932, the market continued to lose 89% of its value. Despite the crash, the worst of the crisis did not reverberate around the world until after 1929. The crisis hit panic levels again in December 1930, with a bank run on the Bank of United States ,
15688-414: The mid-1930s, a severe drought ravaged the agricultural heartland of the U.S. Interest rates dropped to low levels by mid-1930, but expected deflation and the continuing reluctance of people to borrow meant that consumer spending and investment remained low. By May 1930, automobile sales declined to below the levels of 1928. Prices, in general, began to decline, although wages held steady in 1930. Then
15836-423: The monetary base and by not injecting liquidity into the banking system to prevent it from crumbling, the Federal Reserve passively watched the transformation of a normal recession into the Great Depression. Friedman and Schwartz argued that the downward turn in the economy, starting with the stock market crash, would merely have been an ordinary recession if the Federal Reserve had taken aggressive action. This view
15984-496: The most to make recovery possible. Every major currency left the gold standard during the Great Depression. The UK was the first to do so. Facing speculative attacks on the pound and depleting gold reserves , in September 1931 the Bank of England ceased exchanging pound notes for gold and the pound was floated on foreign exchange markets. Japan and the Scandinavian countries followed in 1931. Other countries, such as Italy and
16132-427: The most. The outbreak of World War II in 1939 ended the Depression, as it stimulated factory production, providing jobs for women as militaries absorbed large numbers of young, unemployed men. The precise causes for the Great Depression are disputed. One set of historians, for example, focuses on non-monetary economic causes. Among these, some regard the Wall Street crash itself as the main cause; others consider that
16280-568: The need to balance the national budget and was unwilling to implement expensive welfare spending . In 1930, Hoover signed the Smoot–Hawley Tariff Act , which taxed imports with the intention of encouraging buyers to purchase American products, which worsened the Depression because foreign governments retaliated with tariffs on American exports. In 1932, Hoover established the Reconstruction Finance Corporation , which offered loans to businesses and support to local governments. In
16428-652: The north by desert, to the south by the Mapuche, to the east by the Andes Mountains, and to the west by the ocean, Chile became one of the most centralized, homogeneous territories in Spanish America. Serving as a sort of frontier garrison , the colony found itself with the mission of forestalling encroachment by both the Mapuche and Spain's European enemies, especially the English and the Dutch . Buccaneers and pirates menaced
16576-526: The north, Bolivia to the northeast, Argentina to the east, and the Drake Passage to the south. The country also controls several Pacific islands, including Juan Fernández , Isla Salas y Gómez , Desventuradas , and Easter Island , and claims about 1,250,000 square kilometers (480,000 sq mi) of Antarctica as the Chilean Antarctic Territory . The capital and largest city of Chile
16724-433: The overall number of migrants was small. This effect might be related to externalities : the surrounding population adopted a similar behavior as the small non-European immigrant group, and new schools were created. Ironically, there might have been positive spillover effects from the educational investment made by migrants, at the same time numeracy might have been reduced by the greater inequality in these regions. However,
16872-483: The physical volume of exports fall, but also the prices fell by about 1 ⁄ 3 as written. Hardest hit were farm commodities such as wheat, cotton, tobacco, and lumber. Governments around the world took various steps into spending less money on foreign goods such as: "imposing tariffs, import quotas, and exchange controls". These restrictions triggered much tension among countries that had large amounts of bilateral trade, causing major export-import reductions during
17020-477: The policies prolonged the Depression instead of shortening it. Between 1929 and 1932, worldwide gross domestic product (GDP) fell by an estimated 15%; in the U.S., the Depression resulted in a 30% contraction in GDP. Recovery varied greatly around the world. Some economies, such as the U.S., Germany and Japan started to recover by the mid-1930s; others, like France, did not return to pre-shock growth rates until later in
17168-455: The political situation in Europe. In their book, A Monetary History of the United States , Milton Friedman and Anna J. Schwartz also attributed the recovery to monetary factors, and contended that it was much slowed by poor management of money by the Federal Reserve System . Chairman of the Federal Reserve (2006–2014) Ben Bernanke agreed that monetary factors played important roles both in
17316-402: The population consisted of 259,646 inhabitants: 73.5% of European descent , 7.9% mestizos , 8.6% indigenous peoples and 9.8% blacks. Francisco Hurtado, Governor of the province of Chiloé , conducted a census in 1784 and found the population consisted of 26,703 inhabitants, 64.4% of whom were whites and 33.5% of whom were natives. The Diocese of Concepción conducted a census in areas south of
17464-455: The positive effects of immigration were apparently stronger. In 1808, Napoleon's enthronement of his brother Joseph as the Spanish King precipitated the drive by Chile for independence from Spain . A national junta in the name of Ferdinand – heir to the deposed king – was formed on 18 September 1810. The Government Junta of Chile proclaimed an autonomous government for Chile within
17612-683: The regions to the south of the Central Valley and to improve existing infrastructure in the South. The Región Aysén del General Carlos Ibáñez del Campo is named after him, in honor of his attempts to integrate the isolated regions of Aysén and Magallanes into Chile . The General Ibáñez Airport in Punta Arenas is also named after him. Chile Chile ( / ˈ tʃ ɪ l i / CHIL -ee or / ˈ tʃ ɪ l eɪ / CHIL -ay , Spanish: [ˈtʃile] ), officially
17760-547: The result from the arbitral award of the Andes resolved by the British Crown . In 1903 the Puna de Atacama dispute was solved. In 1904 Chile and Bolivia signed a Treaty of Peace and Friendship which clarified the border between both countries. The Chilean economy partially degenerated into a system protecting the interests of a ruling oligarchy . By the 1920s, the emerging middle and working classes were powerful enough to elect
17908-434: The scale necessary to make the grand experiments which would prove my case—except in war conditions." According to Christina Romer , the money supply growth caused by huge international gold inflows was a crucial source of the recovery of the United States economy, and that the economy showed little sign of self-correction. The gold inflows were partly due to devaluation of the U.S. dollar and partly due to deterioration of
18056-647: The similarity of the valley of the Aconcagua with that of the Casma Valley in Peru, where there was a town and valley named Chili . Other theories say Chile may derive its name from a Native American word meaning either 'ends of the earth' or 'sea gulls'; from the Mapuche word chilli , which may mean 'where the land ends'" or from the Quechua chiri , 'cold', or tchili , meaning either 'snow' or "the deepest point of
18204-475: The small islands of San Ambrosio and San Felix . These islands are notable because they extend Chile's claim to territorial waters out from its coast into the Pacific Ocean. The northern Atacama Desert contains great mineral wealth, primarily copper and nitrates . The relatively small Central Valley, which includes Santiago, dominates the country in terms of population and agricultural resources. This area
18352-590: The stand as one of the high-income countries in South America by 1870. On 9 September 1888, Chile took possession of Easter Island by the signing of a mutual will agreement with the local king, thanks to the efforts of the Bishop of Tahiti, Monsignor José María Verdier since the island was constantly attacked by slave merchants. The naval officer Policarpo Toro represented the Chilean Government and Atamu Tekena
18500-523: The successful rescue of 33 trapped miners in 2010. On 5 August 2010, the access tunnel collapsed at the San José copper and gold mine in the Atacama Desert near Copiapó in northern Chile, trapping 33 men 700 meters (2,300 ft) below ground. A rescue effort organized by the Chilean government located the miners 17 days later. All 33 men were brought to the surface two months later on 13 October 2010 over
18648-448: The total number of killed, tortured or imprisoned for political reasons to 40,018. At the national stadium, filled with detainees, one of those tortured and killed was internationally known poet-singer Víctor Jara (see "Music and Dance", below). A new Constitution was approved by a controversial plebiscite on 11 September 1980, and General Pinochet became president of the republic for an eight-year term. After Pinochet obtained rule of
18796-506: The triple minister Diego Portales . Two other civil wars happened in Chile in the 1850s, one in 1851 and the other one in 1859 . Toward the end of the 19th century, the government in Santiago consolidated its position in the south by the Occupation of Araucanía . The Boundary treaty of 1881 between Chile and Argentina confirmed Chilean sovereignty over the Strait of Magellan but also made
18944-575: The universalization of the name Chile , after naming the Mapocho valley as such. The older spelling "Chili" was in use in English until the early 20th century before switching to "Chile". Stone tool evidence indicates humans sporadically frequented the Monte Verde valley area as long as 18,500 years ago. About 10,000 years ago, migrating Indigenous peoples settled in fertile valleys and coastal areas of what
19092-471: The world, recovery from the Great Depression began in 1933. In the U.S., recovery began in early 1933, but the U.S. did not return to 1929 GNP for over a decade and still had an unemployment rate of about 15% in 1940, albeit down from the high of 25% in 1933. There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and
19240-659: The world. The financial crisis escalated out of control in mid-1931, starting with the collapse of the Credit Anstalt in Vienna in May. This put heavy pressure on Germany, which was already in political turmoil. With the rise in violence of National Socialist ('Nazi') and Communist movements, as well as investor nervousness at harsh government financial policies, investors withdrew their short-term money from Germany as confidence spiraled downward. The Reichsbank lost 150 million marks in
19388-778: The worldwide economic decline and eventual recovery. Bernanke also saw a strong role for institutional factors, particularly the rebuilding and restructuring of the financial system, and pointed out that the Depression should be examined in an international perspective. Women's primary role was as housewives; without a steady flow of family income, their work became much harder in dealing with food and clothing and medical care. Birthrates fell everywhere, as children were postponed until families could financially support them. The average birthrate for 14 major countries fell 12% from 19.3 births per thousand population in 1930, to 17.0 in 1935. In Canada, half of Roman Catholic women defied Church teachings and used contraception to postpone births. Among
19536-519: Was a de facto dictatorship (although not really comparable in harshness or corruption to the type of military dictatorship that have often bedeviled the rest of Latin America). By relinquishing power to a democratically elected successor, Ibáñez del Campo retained the respect of a large enough segment of the population to remain a viable politician for more than thirty years, in spite of the vague and shifting nature of his ideology. When constitutional rule
19684-639: Was a scramble to deflate prices to get the gold standard's conversation rates back on track to pre-WWI levels, by causing deflation and high unemployment through monetary policy. In 1933 FDR signed Executive Order 6102 and in 1934 signed the Gold Reserve Act . The two classic competing economic theories of the Great Depression are the Keynesian (demand-driven) and the Monetarist explanation. There are also various heterodox theories that downplay or reject
19832-498: Was a severe global economic downturn from 1929 to 1939. The period was characterized by high rates of unemployment and poverty; drastic reductions in liquidity , industrial production, and trade; and widespread bank and business failures around the world. The economic contagion began in 1929 in the United States , the largest economy in the world, with the devastating Wall Street stock market crash of October 1929 often considered
19980-478: Was a small part of overall economic activity in the U.S. and was concentrated in a few businesses like farming, it was a much larger factor in many other countries. The average ad valorem (value based) rate of duties on dutiable imports for 1921–1925 was 25.9% but under the new tariff it jumped to 50% during 1931–1935. In dollar terms, American exports declined over the next four years from about $ 5.2 billion in 1929 to $ 1.7 billion in 1933; so, not only did
20128-474: Was endorsed in 2002 by Federal Reserve Governor Ben Bernanke in a speech honoring Friedman and Schwartz with this statement: Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression, you're right. We did it. We're very sorry. But thanks to you, we won't do it again. The Federal Reserve allowed some large public bank failures – particularly that of
20276-426: Was given by American economists Milton Friedman and Anna J. Schwartz . They argued that the Great Depression was caused by the banking crisis that caused one-third of all banks to vanish, a reduction of bank shareholder wealth and more importantly monetary contraction of 35%, which they called "The Great Contraction ". This caused a price drop of 33% ( deflation ). By not lowering interest rates, by not increasing
20424-487: Was helped by massive loans by American banks, which helped to promote a high rate of growth in the country. He constructed massive public works, and increased public spending. He also created the Carabineros de Chile (police force) by unifying the previously disorganized police forces. Another significant achievement of Ibáñez's first administration was the signing of the 1929 Treaty of Lima , in which Chile agreed to return
20572-491: Was in the form of Federal Reserve demand notes. A "promise of gold" is not as good as "gold in the hand", particularly when they only had enough gold to cover 40% of the Federal Reserve Notes outstanding. During the bank panics, a portion of those demand notes was redeemed for Federal Reserve gold. Since the Federal Reserve had hit its limit on allowable credit, any reduction in gold in its vaults had to be accompanied by
20720-446: Was intended. It exacerbated the Great Depression by preventing economic recovery after domestic production recovered, hampering the volume of trade; still there is disagreement as to the precise extent of the Act's influence. In the popular view, the Smoot–Hawley Tariff was one of the leading causes of the depression. In a 1995 survey of American economic historians, two-thirds agreed that the Smoot–Hawley Tariff Act at least worsened
20868-422: Was marked by severe left-right political polarization and turmoil, which culminated in the 1973 Chilean coup d'état that overthrew Salvador Allende 's democratically elected left-wing government . This was followed by a 16-year right-wing military dictatorship under Augusto Pinochet , which resulted in more than 3,000 deaths or disappearances . The regime ended in 1990, following a referendum in 1988 , and
21016-627: Was restored in 1932, a strong middle-class party, the Radicals, emerged. It became the key force in coalition governments for the next 20 years. During the period of Radical Party dominance (1932–52), the state increased its role in the economy. In 1952, voters returned Ibáñez del Campo to office for another six years. Jorge Alessandri succeeded Ibáñez del Campo in 1958, bringing Chilean conservatism back into power democratically for another term. The 1964 presidential election of Christian Democrat Eduardo Frei Montalva by an absolute majority initiated
21164-550: Was succeeded by a center-left coalition , which ruled until 2010. Chile is a developing country with a high-income economy and is one of the most economically and socially stable nations in South America. Chile also performs well in the region in terms of sustainability of the state and democratic development. Chile is a founding member of the United Nations , the Community of Latin American and Caribbean States (CELAC), and
21312-593: Was succeeded in 2000 by Socialist Ricardo Lagos , who won the presidency in an unprecedented runoff election against Joaquín Lavín of the rightist Alliance for Chile . In January 2006, Chileans elected their first female president, Michelle Bachelet Jeria , of the Socialist Party, defeating Sebastián Piñera , of the National Renewal party, extending the Concertación governance for another four years. In January 2010, Chileans elected Sebastián Piñera as
21460-619: Was the communist Elías Lafertte , who was exiled in the Juan Fernández Archipelago throughout the electoral campaign. Ibáñez won the election with 98% of the vote. Ibáñez began to exercise dictatorial powers, using rule by decree ( decretos con fuerza de ley ), suspending parliamentary elections, instead naming politicians to the Senate and Chamber of Deputies himself, etc. Political opponents were arrested and exiled, including his former ally Marmaduke Grove . His popularity, however,
21608-526: Was the head of the Council of Rapanui. The Rapa Nui elders ceded sovereignty, without renouncing their titles as chiefs, the ownership of their lands, the validity of their culture and traditions and on equal terms. The Rapa Nui sold nothing, they were integrated in equal conditions to Chile. The 1891 Chilean Civil War brought about a redistribution of power between the President and Congress, and Chile established
21756-464: Was the rollback of those same reflationary policies that led to the interruption of a recession beginning in late 1937. One contributing policy that reversed reflation was the Banking Act of 1935 , which effectively raised reserve requirements, causing a monetary contraction that helped to thwart the recovery. GDP returned to its upward trend in 1938. A revisionist view among some economists holds that
21904-479: Was with Ibáñez's backing. Figueroa triumphed with 71% of the vote, but kept Ibáñez as Home Affairs Minister. Ibáñez was able to control the weak Figueroa who decided to resign in 1927 rather than be Ibáñez's puppet. Because he was Home Affairs Minister, under the Chilean constitution, Ibáñez became Vice President and announced elections for 22 May that year. In the presidential elections, the traditional political parties decided not to participate. Ibáñez's only opponent
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