Welcome to the LSE IDEAS Blog

LSE IDEAS is a centre for the study of international affairs, diplomacy and grand strategy at the London School of Economics. This blog features articles, resources, reviews and opinion pieces from academics associated with LSE IDEAS.

Monday, 1 March 2010

A quake to Chile's social reallity

Indeed what happened in Chile is terrible, and continuously shocking. Every day that passes we are more able to realize what really occurred, as communications are improving and water returns to the sea. Like always, those who had little are the ones who lost all.
The Chilean quake is also a big slap on the face to a society that had become increasingly conformist. A society that ironically was just a few months ago celebrating its status of new OECD member, but now crashes with its pure reality; a country with a social inequality deeper than the great cannon, which splits the nation in two raw groups: those still in the OECD, and those who cannot survive a natural disaster.
Chile's social policy for years has had a strong focus in reducing poverty. In fact, we congratulated ourselves as chileans for reducing poverty from 40% in early 1990s to 15% in mid 2000s. These numbers freezed our senses and we increasingly began to believe that the poverty problem was on a right road for being solved, without paying attention to the large population which, literally lived slightly above the line in a place invisible to poverty-line numbers and OECD standards.
It is no surprise that after the quake poverty and inequallity will rise in Chile. Recovery is not a task of 5 days, nor 5 weeks, not even 5 months. This may take perhaps 5 years!, time enough to rebuild houses, create jobs, and re-design our social policy with a broader focus that is comprehensive with poverty and inequality as roots of the same problem (the notion of "social exclusion" as distinguished from "poverty" might be a good idea). Poverty lines and standards give us a good idea of are development speed, but in no case they should be considered as ends themselves.
There is now a lot to be done. I have no doubt that the chilean people will stand up again such as we have from previous quakes (1962,1985). I just hope that in the long run we do not forget a large part of the population that live in vulnerable condition. They not only need today's assistantce, but also long term social policies that re-focus on the grounds of their social exclusion from the promised prosperity.

Felipe I. Heusser


Anonymous said...


Rather than 'poverty line', or social 'exclusion' I would face the problem as social 'segregation'. This distinction is relevant since this problem particularly in Chile seems to be a 'spatial' one, either in urban or rural areas. That is why yesterday 'poor' people was affected while the 'privileged' were having bbq. Thank you for your post!

Alejandra Celedon

Felipe I. Heusser said...

Thanks Alejandra,

You are definitely right about social segregation. Though I consider here "social exclusion" as a comprehensive term that includes spacial exclusion (urban segregation)as well as labor market exclusion, education exclusion, health exclusion, and so on. The key idea is to avoid social policies that are based in discretionary thresholds (poverty lines), and move towards "relative considerations of poverty" which focus more on the gaps between society in terms of social rights, being of course -the right to live in an integrated city- one of them.

Felipe I. Heusser

Anonymous said...

Completely agree, though 'exclusion' many times is consequence of 'segregation'; spatial in case of urbanity, territorial in terms of rurality. Just wanted to rise the point, that education, health, labour, might be spatial problems as well as econmic or political ones. :)


Esteban Szmulewicz said...

I think I agree with the sort of "static" picture you are drawing. However, the bigger question is the rather more "dynamic" question of how poverty and inequality rates have evolved over time. In this sense, understand that the official poverty line by the Planning Minister takes into account international standards, and its purpose is to facilitate comparison over time, which means that one cannot change the basis of comparison, otherwise it will become extremely difficult. If one is to accept this measure, effectively Chile's progresses are visible, especially when compared with the meagre performance in other Latin American countries.
Despite Chile's undeniable success in tackling poverty, its record on equality seems much more discouraging. In almost 20 years of democratic governments, the Gini coefficient has no changed significantly. Minor changes due to President Bachelet social policies also reveal the weak foundations of Chile's social policy. Instead of increasing long-term capabilities, the policies often seem directed towards short-run alleviation. Moreover, inequality and poverty are self perpetuating. In a 2006 World Bank Report (Poverty Reduction and Growth: Virtuous and Vicious Circles), authors were able to demonstrate that just about 50% of short and long-term poverty can be explained by growth. The rest of the share is explained by changes in income inequality.
Finally, in light of this evidence, one needs to ask whether Chile's institutional infrastructure would respond adequately to the crisis. Public and private insurances systems have to be made responsible in the appropiate cases. In the case of public works, public roads and concessionaries from highways should have a significant burden in the reconstruction efforts, despite legal battles. Finally, in the case of personal properties, especially housing, my guess is that there is where we will see a great deal of inequality, since much of the richer people construction in Santiago, Concepcion and other main cities have to be secured even against natural disaster, as much as in the Kathrina hurricane where some private insurance and reinsurance companies went broken unable to pay for the insurance to their clients. In the case of smaller and poorer communities in Chile, the vast majority of the houses did not have insurance, and there the reconstruction effort by the government and civil society will have a major role to play.