Jose Manuel de la Maza / Reuters Chile's President Michelle Bachelet in front of the government palace in Santiago, September 18, 2014.

Chile in Crisis

South America's Model Nation Grapples With Graft

Chile has long been considered one of Latin America’s least corrupt countries, which is why recent revelations have left the nation in shock. Both right and left wing parties have been implicated in corruption scandals, and President Michelle Bachelet’s son has been accused of using his influence to make lucrative land deals. The scandals have led to a serious decline in public confidence in the political elite and have damaged Bachelet’s reputation and her ambitious reform agenda.

Some argue that Chile is living through the worst political crisis since the 1973 overthrow of President Salvador Allende by the national armed forces. That is certainly exaggerated. Chile’s democracy under Bachelet is not at risk. Even so, finding a solution to corruption will certainly not be easy, since it requires strong leaders who can commit to injecting greater transparency into party financing. After a period of partisan mudslinging, and the lurid media headlines that followed, many of Chile’s political leaders have begun to recognize that the general public has grown extremely disenchanted with them and the political system as a whole. As a remedy, these leaders have begun behind-the-scene negotiations for a “great accord” that would be implemented by a central institution, like the Congress, to make electoral financing reform a priority.

The current crisis began in October 2014, when the public ministry, the judicial agency that investigates and prosecutes crimes involving public officials, accused the main opposition party, the right-wing Independent Democratic Union, of accepting illegal funds from Penta, an investment bank and holding company, owned by former supporters of the Chilean military regime under Augusto Pinochet. Four Penta executives were eventually convicted of dodging tax payments on their political contributions, and they are now in jail as they await their appeal. This turn of events proved a windfall for Bachelet’s leftist supporters, who quickly denounced the Independent Democratic Union as a corrupt instrument of the political right. They also took the opportunity to vilify Penta and denounce

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