Business, Labor, and the State: The Transformation of the State-Society Nexus

Abstract

Since its inception, the Chilean state has played a substantial role in structuring the balance of power between business and labor. As a result, it has had a profound impact on the popular sectors’ capacity for collective action and political participation. Although retrenchment and repression were common, for much of the twentieth century, the state evolved in a manner that granted the labor movement and the popular sectors more generally, increasingly greater representation and influence. By facilitating the inclusion and representation of segments of society that historically had been underrepresented, if not altogether excluded, the process of state development made Chilean politics significantly more democratic. However, with the overthrow of President Salvador Allende’s Unidad Popular (Popular Unity) government on September 11, 1973, the Chilean Armed Forces brought this process of increased democratic inclusiveness and popular sector political participation to an abrupt halt. Subsequent to the coup, the military unleashed a wave of brutal repression against organized labor, leftist parties, and popular sector interest associations intended to reverse the process of increasing popular sector incorporation and influence. In addition to physical repression, the military regime implemented, with substantial business sector support, a series of institutional and economic reforms that brought intensified market pressures to bear on workers and weakened their capacity for collective action.