CHILE: Economy Under Repairs

Chile, the "shoestring country" that U.S. children learn about from their fourth-grade geography books, is in the toils of a silent and hopeful revolution, no less tense and dramatic for being economic rather than political. The astonishing evidence is that a 40-year-old inflation, moving with express-train acceleration, has been braked to a stop since January. The significance is that Chile, while the world of economists and traders watches with interest and hope, is scrapping outmoded government controls and veering toward a free economy.

The abrupt change from familiar controls to chancy freedom might be no great trick for a South American dictatorship, ruled by decree; but in democratic Chile the reform is going ahead by vote of Congress, which is convinced that austerity is what the people want. One politico, who at first opposed the change, admitted last week, "We underestimated the civic conscience of our people.''

People & President. The 6,400,000 people of Chile—a mixture of Basque and Catalan stock, with some blend of the original Araucanian Indians—have demonstrable courage and energy. Though outnumbered in an 1879-83 war with Peru and Bolivia, they easily grabbed the copper and nitrate riches of the rainless northern deserts, thus completed the process of making their country so long (2,600 mi.) that if it were magically moved it could serve as a land bridge from Boston to Belfast. Chileans are 90% literate and obstinately democratic, but by a quirk they have elected as their President a man who was once their dictator: General Carlos Ibáñez del Campo.

President Ibáñez, at 78, is still stern, upright and tempestuous. The son of a wealthy landowner, he early learned to sit a horse and boss his father's peons. The landowning politicians of Chile's 19th century— Conservatives who disputed for power with equally conservative Liberals— molded his beliefs to the right. The Chilean cavalry gave him a passion for humorless order; Chileans say that once, for reasons of pure esthetic tidiness, he made a tall clarinetist in a military band trade instruments with a short trombonist.

Conservatism and orderliness led Ibáñez, in 1925, to take part in an army revolt against Chile's first reform-minded liberal President, Arturo Alessandri. Making himself dictator, he borrowed $300 million abroad, touched off a period of prosperity, then saw his regime collapse in 1931 with the Depression. The experience soured Chile on dictatorship, but did not discourage Ibáñez. He tried three more revolutions, including a 1939 Putsch copied after that of the Nazis. All failed, and Ibáñez finally decided, in 1952, to try the ballot box. His lonely, military stiffness, his speeches barked out like parade-ground orders, and his earnest promises to cut the cost of living, appealed to Chileans tired of the older parties. He won easily.

Paternal & Popular. But if Chileans variously feared or anticipated a dictator, what they got was a law-respecting President, in deep economic trouble from the start. Ibáñez worked his way through 17 Cabinet shuffles involving 58 Ministers. Congress insistently opposed his legislative programs, which, though never A B C clear, proposed some type of reform of the economic controls he inherited.