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Pinochet's government cut average tariffs from 94% to 10% between 1974 and 1979…

2026-08-04 · 02:44 UTC ·@pa_coyote94151 ·1 min read

Brief

Handre (cited by @pa_coyote94151) presents Pinochet-era liberalization—tariffs cut from 94% to 10% (1974–79), removal of price controls, and privatizations by the Chicago Boys—as producing ~8% annual GDP growth (1976–80), reduced poverty and more consumer goods, contrasted with Allende's 500+ nationalizations and 600% inflation in 1973; political repression is acknowledged but treated as a separate issue.

Why it matters

Pinochet's government cut average tariffs from 94% to 10% between 1974 and 1979; dismantling price controls, privatizing state enterprises, and opening the economy coincided with roughly 8% annual GDP growth from 1976–1980, falling poverty, and wider availability of consumer goods.

Key details

  • Salvador Allende's government nationalized over 500 companies and drove inflation to 600% annually by 1973, producing shortages, bread lines, and a thriving black market.
  • The post acknowledges Pinochet's political atrocities but insists political repression and the economic effects of liberalization are separable facts that should be evaluated independently.
Source evidence

This has been demonstrated many times. Including in the United States of America Yet socialists, statists, communists keep denying it.

Handre (@Handre)

When Pinochet's government slashed tariffs from an average of 94% down to 10% between 1974 and 1979, Chile ran a controlled experiment that statists still refuse to grade honestly.

The Chicago Boys, possibly the coolest name in history for a group of economists, were Chilean economists who trained under Milton Friedman at the University of Chicago. They dismantled price controls, privatized state enterprises, and opened the economy to foreign competition. The results were not subtle. Between 1976 and 1980, Chile's GDP grew at roughly 8% annually. Poverty rates fell. Consumer goods that previously required government permission to import sat on store shelves at prices ordinary Chileans could afford.

Compare that to what came before. Salvador Allende's government had nationalized over 500 companies and driven inflation to 600% annually by 1973. Shortages everywhere. Bread lines were real. The black market was the economy.

When bureaucrats stepped aside to let the market do its job, the economy flourished, as always.

Critics fixate on the Pinochet dictatorship, which carried genuine atrocities, and use those crimes to dismiss the economic liberalization. Political repression and free trade policy are separable facts. You evaluate them separately and the economics worked. The political violence was inexcusable. Both statements survive scrutiny without canceling each other.

— https://nitter.net/Handre/status/2084351981947113861#m