by Axel Kaiser*

Latin America’s freest, most stable and richest nation, Chile, is in a free fall. Public order has collapsed, violence is out of control and populism is the new creed of the political class. There is an economic crisis, characterized by capital flight and rising unemployment and there is a serious chance that three decades of progress made in the fight against economic inequality will be reversed according to a recent statement by Chile’s Central Bank.

The upheaval is all the more remarkable because of Chilean progress over the last four decades. Chile’s free market reforms knocked down the poverty rate to less than 10% of the population–from over 50% pre-reform. Over the same period per capita income quadrupled, chronic inflation disappeared, social mobility shot up and intergenerational income inequality shrank to a historic low.

It took a mere 40 days for the Latin American “oasis”—as President Sebastián Piñera called Chile not long ago—to vanish. How a stable and prosperous Chile fell so dramatically in such a short period is a lesson for every Western democracy. 

The immediate cause for the crisis was the small increase in the price of public transportation tickets in Santiago. As soon as the price hike was announced on October 4th criticism arose. Demands for a withdrawal of the increase became widespread after the new tariff was implemented three days later. 

Initially the government showed no willingness to reconsider what it called a “technical” measure. As a result, hundreds of students began to evade payment of the subway. On Oct. 18, two weeks after the price increase had been announced, the country exploded. Coordinated groups burned and destroyed almost 80 subway stations bringing Santiago’s public transportation system to a halt. Riots and massive attacks on public and private property followed unleashing chaos in the capital city.  

By the end of the day, the situation was so desperate that Mr. Piñera had no choice but to declare a state of emergency and put the military in control. Massive demonstrations followed, and violence returned as soon as the state of emergency was lifted. A few weeks later, the consequences are everywhere: more than $2 billion in losses and damages, around 1,200 looted retail stores, an estimate of 300,000 new unemployed, 25 dead, more than 2,000 injured police officers and a political and economic crisis with no end in sight.

A small hike in the price of subway tickets didn’t cause so much devastation. The economic malaise started with the anti-market reforms of the previous government under Socialist President Michelle Bachelet, from 2014-18. In her second term, Ms. Bachelet raised corporate taxes by 30%; signed a law banning the replacement of workers on strike, thereby dramatically increasing the costs of labor; increased public spending at a rate three times faster than the growth of the economy and unleashed armies of regulatory bureaucrats on the private sector. As a result, capital investment fell in each year of her four-year term. Such a consistent reduction in investment hasn’t happened since data was first collected in the early 1960s. Not surprisingly, economic growth collapsed from an average 5.3% under the previous government of Mr. Piñera (2010-14) to an average of 1.7% under Ms. Bachelet. Real wage growth took a 50% hit. 

In his campaign for president in 2017, Mr. Piñera promised to bring back better times. He failed to deliver. Hence the anger against him.
But Ms. Bachelet’s harmful policies aren’t the root of the problem. As historian Yuval Noah Harari has pointed out, humans are, above all, a story-telling species. It is the narratives, myths and stories we share what enable us to create institutions that favor personal freedom, prosperity and peace. By the same token, narratives can also lead to destruction, war and misery as the cases of communism and national socialism perfectly illustrate. In Chile the emotional power of story-telling has overthrown the sober appeal of reality. Over the past 20 years, intellectuals, media personalities, business leaders, politicians and celebrities in this Latin American nation have created the myth that Chile is an extreme case of injustice and abuse. This false narrative began at the universities, where progressive ideologues spread the idea that there was nothing to feel proud about when it came to Chile´s social and economic record.  They accused “neoliberalism” of creating a society of winners and losers, where neither group deserved the position in which they found themselves. Ms. Bachelet’s second term and her social justice-driven agenda were the inevitable result. Even Mr. Piñera, himself a billionaire, basically accepted the premises of the progressive elites’ narrative. In his first term he raised taxes, declaring that one of Chile´s main problems was inequality.
Now he is trying to re-establish order by buying off interest groups with further economic interventions. Among other measures, he has announced a substantial increase in government spending for supporting retirees, higher personal income taxes, more generous health insurance schemes and a guaranteed minimum income for all full time Chilean workers. 

Nor is the damage done by progressive narratives restricted to economics. A sustained war against law enforcement has been going on for years. As a result, many police officers don’t dare act for fear of biased media coverage and punishments by courts dominated by progressive elites. The same is true for the military. The truth is that tolerance of violence, public disorder and crime was the norm in Chile long before the recent crisis.

The free market did not fail Chile, whatever its politicians might say, and the state does not lack the means to restore the rule of law. The central problem is that a large part of the elites who run key institutions—especially the media, the National Congress and the judiciary no longer believe in the principles that made the country successful. The result is a full-blown economic and political crisis with no end in sight. To other western nations, this should offer a lesson.

*Dr. Axel Kaiser is a scholar at Adolfo Ibañez University in Santiago, and currently a Visiting Fellow at Stanford University’s Hoover Institution.

ECAEF is grateful for the permission and pleased to post here an important interview that Prof. Agnes Ricroch (F) recently granted L’Opinion.

SÉRIE
– France, que fais-tu de ta liberté ? –
Episode 8:

Des pans de la recherche française sont devenus tabous, la liberté de chercher n’y existe plus

Enseignante-chercheure à AgroParisTech et à l’université Paris-Sud, professeur adjoint à la Pennsylvania State University (États-Unis), Agnès Ricroch est aussi membre du comité d’éthique de l’Ordre national des Vétérinaires, secrétaire de la section Sciences de la vie de l’Académie d’agriculture de France.

La France se définit encore elle-même comme la patrie des Lumières. Pourtant, vous alertez sur le fait que des pans de sa recherche sont privés de liberté…

Cela dépend des domaines. La France abrite des secteurs de recherche dynamiques, en pointe, innovants. C’est le cas pour la santé – la recherche contre le cancer ou les maladies génétiques, avec des expériences poussées en thérapie génique, en édition du génome –, les énergies renouvelables, la neutralité carbone, la chimie verte… Cela colle avec l’air du temps, répond aux grands enjeux sociétaux, notamment climatiques, internationaux et s’inscrit dans les priorités européennes. Sur ces sujets, il n’y a pas de pénurie d’argent, on peut mobiliser des chercheurs. Un bon exemple : l’Institut du cerveau et de la moelle épinière, à Paris, qui fait un travail remarquable et interdisciplinaire agrégeant aussi des sciences sociales sur les maladies neurodégénératives. Cependant, il existe des domaines devenus des tabous. Des repoussoirs politiques. C’est le cas de la recherche sur le clonage, ou sur les OGM, ma spécialité. La recherche française est en situation de blocage quasi-complet. Sa créativité est entravée, bridée, alors qu’elle a prouvé, par le passé, qu’elle pouvait être extrêmement fertile. Dans les laboratoires français, avant que les OGM ne soient ostracisés, on mettait au point des maïs avec une meilleure utilisation de l’azote dans le but de moins polluer les nappes phréatiques par les nitrates et de réduire les gaz à effet de serre ! Ils ont été vandalisés. La liberté de chercher a quasi disparu dans ce domaine, elle s’oriente sur d’autres outils.

Que s’est-il passé ?

Ces sujets ont été happés par la politique. On a calqué sur la recherche une grille de lecture grossière gauche/droite qui se traduit par anticapitalisme/libéralisme. Les biotechnologies végétales et particulièrement les …

-> l’Opinion

by Henrique Schneider*

This timely and important essay is an edited version of a paper that Henrique Schneider (CH) delivered as the opening at the IV. ECAEF/CEPROM Conference in Monaco on Dec. 10, 2019.

The Anthropocene is a proposed geological epoch dating from the commencement of significant human impact on Earth’s geology and ecosystems, including, but not limited to, anthropogenic climate change. While it is not an academically established definition, as of yet, it is proposed to have begun in the 1950s. This article posits that the concept is erroneous in at least two ways. First, it relies on a normative, activist, appropriation of science. Second, is disregards the system-property of the ecosystem, which is marked by the continuous interaction between the system and its parts, or agents. But more than this, the idea of the Anthropocene is a case study for how activist agendas appropriate science and academia depriving it from an important academic feature, its skeptical method.

Science or activism?

“Anthropocene Syndrome: a complex of environmental degradation, biological annihilation in the form of species losses, non-communicable disease epidemics, climate change, and increasing incivility in public and professional discourse” (Prescott & Logan 2017, 19). This quote is indicative of many problems. First, it is a normative claim disguised as an academic piece; second, it is uninformed; and, third, it does not conform to the academic method.

Markers of the normativity in the quote are expressions such as “annihilation” and, ironically, the complaint about incivility in professional discourse. These indicate undeclared subjective preferences that might preclude the authors from applying the scientific method. More specifically, these preferences hinder the authors in reaching a conclusion that is independent from their own opinions. That, in fact, happens in the text, when the authors present their solution, similarly marked by normativity and reflective of their own opinions and not of a scientific argument. “The Symbiocene can transcend these trends. The health of people, place, and planet requires compassion, education by example, civility, and diversity of thought” (Prescott & Logan 2017, 41). Tellingly, the “scientific” word Anthropocene is identified as a problem, and the equally “scientific” expression Symbiocene, which seems to be at the same level of but contrary to the Anthropocene, is a solution.

The article is uninformed because, in spite of circa 150 endnotes, it does not once critically address its own assertions. There is not one counter argument, not even one that is refuted. All documentation is nothing but supportive for the normative claim of the authors. This might be a method, but it is not the scientific method, which method is characterized by steady skepticism, the multivariate test of theses or hypothesis with experiments and data or with pro- and counter-arguments in order to reach a conclusion that is independent from one’s intuition or opinion. In this skeptical method, not even the conclusion is definitive but invites to further skeptical investigation (Gauch et al. 2003).

Critically, one might argue that Prescott and Logan are just two scientists, their article is just one article (granted, an invited article that did not pass peer review), and the journal in which it was published is not ranked. The problem, however, goes beyond this article. The concept of the Anthropocene is indicative of how of activism is permeating academia, and even science; transforming both from an institutionalized skeptical method of discovery and creation of knowledge to a process of rationalization of opinions.

These academics sit in boards of multinational companies and other entities, often because of their scientific and academic pedigree. The very idea of having academic, or scientific, advice in these boards is because science is organized skepticism in the form of an expert opinion. Most importantly, methodological caution as it is embedded in the scientific method usually leads to proportional actions (Topitsch 1962). If this should cease to be the case, the case for academia as well as for its link to the practical world weakens, too …

Continue reading ->
The Anthropocene-Fallacy

*Henrique Schneider is a professor of economics at the Nordkademie University of Applied Sciences in Elmshorn, Germany and chief economist of the Swiss Federation of Small and Medium Sized Enterprises in Bern, Switzerland.