Latin America Advisor
A Publication of The Dialogue
Why Are Officials Leaving Chile’s Government?Sep 13 2017
Chile’s finance, deputy finance and economy ministers resigned on Aug. 31, dealing a blow to President Michelle Bachelet’s government. What was behind the resignations? What do the high-level departures mean for Bachelet, her political coalition, and for her ability to carry out the remainder of her agenda before she leaves office in March? What can be expected of the country’s new finance minister, Nicolás Eyzaguirre, and the new economy minister, Jorge Rodríguez?
Patricio Navia, clinical professor of Liberal Studies at New York University and professor of Political Science at Universidad Diego Portales: “In their last months, presidents who are term-limited inevitably become lame ducks. With 10 weeks to go before the first round vote in the presidential election on Nov. 19, Chilean President Michelle Bachelet is already a lame duck. After having gone through tough two years with very low approval ratings, Bachelet is now moving up in the polls as people perceive her as an outgoing president and begin to assess her entire two-term legacy (both during 2006-2010 and 2014-2018). But her improving numbers do not mean that she has more power to push forward her legislative agenda or advance her pet projects. Since former President Sebastián Piñera is comfortably leading the polls, economic actors are now paying more attention to what he has to say about economic policy than to Bachelet’s positions. It is true that Bachelet does not want a repeat of 2010, when she handed power over to a right-wing opposition leader. That explains why Bachelet is sending legislation to Congress that seeks to increase social spending, polarize the electorate and force Piñera to take unpopular but fiscally responsible positions. Those bills—like the pension reform bill—have no chance of passing, but they might make it more difficult for Piñera to win the election at the end of the year. In that context, Rodrigo Valdés’ departure does not have a meaningful effect. His resignation—the first by a finance minister since democracy was restored in 1990—reflects the deep divisions within the center-left coalition on what the roadmap for development should be in the future. But those divisions are evident in the fact that the center-left ruling coalition has two presidential candidates and two different legislative slates of candidates for the November election. Thus, Valdés’ resignation is big news—something like that has never happened before—but we cannot say that his departure is surprising or that it will change the lame-duck condition of the Bachelet administration.”
Peter M. Siavelis, professor and chair of the Politics and International Affairs Department and associate director of the Latin American and Latino Studies Program at Wake Forest University: “Chileans are tired of Michelle Bachelet. Conversations on the streets of Santiago and public opinion survey data—with most surveys showing her hovering slightly below a 30 percent approval rating—suggest this is the case. The resignation of Finance Minister Rodrigo Valdés and Economy Minister Luis Felipe Céspedes, as a result of a series of disagreements between La Moneda’s economic team and the president’s political advisors regarding a proposed mining project in the north of Chile, would seemingly provide more evidence of the widely held notion that Bachelet’s second term has been a failure, characterized by excessive cabinet turnover, incoherent messaging and ad-hoc policymaking. Contrary to this perception, the reality is that this has been an extraordinarily successful government compared to others of the center-left Nueva Mayoría. In the rearview mirror of history, this government will be seen in a much more positive light. Bachelet recently oversaw a comprehensive overhaul of Chile’s draconian abortion laws and a gay-marriage bill is in the works. Earlier in her term, she promoted successful tax and education reforms and the reform of the Pinochet-era binomial electoral system. While it is true that many of these reforms are imperfect, they responded to the contextual political dynamics from which they emerged, and can be perfected by subsequent legislation. That said, given the likely victory of Sebastián Piñera in November’s race to La Moneda, Eyzaguirre and Rodríguez will join what is soon to be a lame-duck administration, with few prospects for advancing further significant reforms. However, the successes of this government are real, and unfortunately for Nueva Mayoría’s future electoral prospects, they are recognized by few.”
Manuel Agosin, dean of the School of Economics and Business at the Universidad de Chile: “The resignations of Finance Minister Rodrigo Valdés and his deputy, Alejandro Micco, together with that of Economy Minister Luis Felipe Céspedes, were a big blow to the Bachelet government. But she had it coming to her. A mining project worth $2.5 billion in a poor region was denied the go-ahead by a committee of six ministers under obscure circumstances, after it had passed the environmental impact assessment and a series of other consultations with interested parties. Céspedes was part of the committee, and he left before the vote, claiming that he had not had the time (between Friday night and Monday morning) to evaluate the project. The ambiguity in the application of laws and regulations is not something that does the country any good. Its vaunted rule of law and strong institutions have been called into question. The authorities who resigned did so because they saw no good reasons for the rejection of the project. The new authorities (Nicolás Eyzaguirre in Finance and Jorge Rodríguez in Economy) are experienced hands and can be expected to do a good job. They have held the same positions in past center-left governments and acquitted themselves well.”