Problem

Enforced curtailment of living standards in borrower nations

Incidence:

In the case of Brazil, which after Mexico has been the principal example of this process in Latin America since the military coup in 1964, wages were reduced by over 40%. In Argentina since the military coup in 1976, wages were reduced by over 50%. But already before the coup real wages were going down as a result of the economic policy of the right wing of the Peronist government in 1974-75. In Chile, real wages since the coup were reduced by two thirds, that is to say, from an index of 100 to an index of just over 30, and unemployment increased from 4% to 20% before levelling off at 12-15%. To be able to do this it was necessary first to destroy or to control the unions, to eliminate, often physically, the leadership, to repress all political opposition and to throw people in gaol, torture them, murder them, exile them etc. Secondly, it has been necessary to distort the economy from producing for the internal market through so-called import substitution, to producing for exports.

Problem Type:
E: Emanations of other problems
Date of last update
02.11.2017 – 18:28 CET