History of Chile
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Early history
About 10,000 years ago, migrating Indians (Mapuches) settled in fertile valleys and along the coast of what is now Chile. The Incas briefly extended their empire into what is now northern Chile, but the area's remoteness prevented extensive settlement. In 1541, the Spanish, under Pedro de Valdivia, encountered hundreds of thousands of Indians from various cultures in the area that modern Chile now occupies. These cultures supported themselves principally through slash-and-burn agriculture and hunting. 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 Viceroyalty of Peru.
Independence
The drive for independence from Spain was precipitated by usurpation of the Spanish throne by Napoleon's brother Joseph Bonaparte. A national junta in the name of Ferdinand--heir to the deposed king--was formed on September 18, 1810. Spanish attempts to reimpose arbitrary rule during what was called the Reconquista led to a prolonged struggle under Bernardo O'Higgins, Chile's most renowned patriot. Chilean independence was formally proclaimed on February 12, 1818.
The political revolt brought little social change, however, and 19th century Chilean society preserved the essence of the stratified colonial social structure, family politics, and the influence of the Roman Catholic Church. The system of presidential power eventually predominated, but wealthy landowners continued to control Chile.
Toward the end of the 19th century, government in Santiago consolidated its position in the south by persistently suppressing the Mapuche Indians. In 1881, it signed a treaty with Argentina confirming Chilean sovereignty over the Strait of Magellan, but meaning the lost by Chile of all the oriental Patagonia, and considerable fraction of the territory it had during colonial times. As a result of the War of the Pacific with Peru and Bolivia (1879-1883), Chile expanded its territory northward by almost one-third and acquired valuable nitrate deposits, the exploitation of which led to an era of national affluence.
In the 1870s, the church influence started to diminish slightly, with the passing of several laws that took some old roles of the church into the State's hands, like the registry of births and marriages.
In 1886, José Manuel Balmaceda was elected president. His economic policies visibly changed the existing liberal policies. He began to violate the constitution and slowly began to establish a dictatorship. Congress decided to depose Balmaceda, who refused to step down. Jorge Montt directed an armed conflict against Balmaceda, which soon extended into the Chilean Civil War of 1891. Defeated, Balmaceda fled to the Argentine embassy, where he commited suicide. Montt became the new president.
20th century
By the 1920s, the emerging middle and working classes were powerful enough to elect a reformist president, whose program was frustrated by a conservative congress. Continuing political and economic instability resulted in a coup and quasi-dictatorial rule of General Carlos Ibáñez (1924-32).
When constitutional rule 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. In the 1920s, Marxist groups with strong popular support developed. During the period of Radical Party dominance (1932-52), the state increased its role in the economy.
Another new force that emerged was the Nazi Party. The party was created on 1932, during the anarchy that succeeded the fall of Ibáñez's government. Months before the elections, Nazi leader González von Marées surpsingly criticized the policies of Hitler and the Third Reich. However, that same year, the Nazis led a revolt which ended on the supression of it and the arrest of various Nazi leaders.
The 1964 presidential election of Christian Democrat Eduardo Frei Montalva by an absolute majority initiated 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.
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In 1970, Salvador Allende, a Marxist and member of Chile's Socialist Party, who headed the "Popular Unity" (UP) coalition of socialists, communists, radicals, and dissident Christian Democrats, was elected by a narrow margin. His program included the nationalization of most remaining private industries and banks, massive land expropriation, and collectivization. Allende's proposal also included the nationalization of U.S. interests in Chile's major copper mines. Elected with only 36% of the vote and by a plurality of only 36,000 votes, Allende never enjoyed majority support in the Chilean Congress or broad popular support. Domestic production declined; severe shortages of consumer goods, food, and manufactured products were widespread; and inflation reached 1,000% per annum. Mass demonstrations, recurring strikes, violence by both government supporters and opponents, and widespread rural unrest ensued in response to the general deterioration of the economy. The MIR evolved during this period, being a violent leftist organization which carried out armed bank robberies to "benefit the poor." Allende did little, if anything, to stop the movement. During this period artistic and social movments flourished.
By 1973, Chilean society had split into two hostile camps. A military coup overthrew Allende on September 11, 1973. As the armed forces bombarded the presidential palace, Allende died. Reports are divided as to whether he committed suicide with a machine gun given to him by his friend Fidel Castro or was assassinated.
The role of the CIA and the government of the United States in the destabilization of Chile and subsequent coup, long suspected since a 1974 leak from Congressman Michael J. Harrington (Democrat, Massachusetts), was confirmed in the year 2000 with the Clinton administration declasified hundreds of documentats showing the influence of the Nixon administration in Chile.
Following the coup in 1973, Chile was ruled by a military regime which lasted until 1990. The army established a junta, made up of the army commander, General Augusto Pinochet; the navy commander, Admiral José Toribio Merino; the air commander, Gustavo Leigh; and the director of the carabineros; César Mendoza. The official death toll includes 3,197 assassinations and "disappearances". In its later years, the regime gradually permitted greater freedom of assembly, speech, and association, to include trade union activity.
In contrast to its authoritarian political rule, the military government pursued decidedly laissez faire economic policies. During its 16 years in power, Chile moved away from economic statism toward a largely free market economy that fostered an increase in domestic and foreign private investment. Government involvement was reduced, privatizing pension funds and healthcare, and liberalizing Superior Education, resulting in a current state participacion of only roughly 20% of the economy.
The military junta began to change during the late '70s. Due to problems with Pinochet, Leigh was expelled from the junta in 1978 and replaced by General Fernando Matthei. Due to a scandal, Mendoza resigned in 1985 and was replaced by Rodolfo Stange.
Problems with Argentina coming from the 19th century reached a high in 1978, with disagreements over the Beagle Canal. The two countries agreed to papal meditation over the canal. The Chilean-Argentine relations remained bad, however, and Chile helped the United Kingdom during the Falklands War.
Chile's constitution was approved in a September 1980 national plebiscite. It entered into force in March 1981. It established than in 1988 there would be a plebiscite in which the voter would accept or reject an only candidate proposed by the Military Junta. Pinochet was, as expected, the candidate proposed, and he was denied a second 8 year term.
After Pinochet's defeat in the 1988 plebiscite, the constitution was amended to ease provisions for future amendments to the constitution, create new senators, and diminish the role of the National Security Council and equalized the number of civilian and military members--four members each. Many among Chile's political class consider these and other provisions as "authoritarian enclaves" of the constitution and have pressed for reform.
In December 1989, Christian Democrat Patricio Aylwin, running as the candidate of a multiparty, Concertacion coalition, was elected president. In the 1993 election, Eduardo Frei Ruiz-Tagle of the Christian Democratic Party was elected president for a 6-year term leading the Concertacion coalition, and took office in March 1994. Exceptionally close presidential elections in December 1999 required an unprecedented runoff election in January 2000. Ricardo Lagos Escobar of the Socialist Party and Party for Democracy led the Concertacion coalition to a narrow victory and took office in March 2000.
In 2003 Chile signed extensive free trade agreements with both the European Union and the United States. Expecting a boom in import and export of local produce and becoming a regional trade-hub.