Miracle of Chile

 

Milton Friedman advised Chilean dictator Augusto Pinochet on economic policy, particularly in a 1975 visit to address hyperinflation. He supported the economic reforms implemented by Pinochet's government, which were based on the "Chicago Boys" economists who studied at the University of Chicago, where Friedman taught. Friedman met with Pinochet to recommend drastic cuts to public spending and a decrease in the money supply to control inflation, and he assured Pinochet that this "shock therapy" would involve a temporary period of hardship and unemployment. 

• Economic advice: In 1975, during a visit to Chile, Friedman met with Pinochet to discuss the nation's economic problems, primarily high inflation. He recommended policies such as drastically cutting public spending and money supply growth to get inflation under control.
• Support for reforms: Friedman later wrote to Pinochet, reassuring him that there was no way to end inflation without a difficult transitional period, and that his initial actions to reverse socialism were wise.
• "Chicago Boys": The economic policies implemented by Pinochet's regime were developed by a group of Chilean economists trained at the University of Chicago, known as the "Chicago Boys".
• "Miracle of Chile": Friedman famously referred to the economic results of these policies as the "Miracle of Chile," arguing that free markets ultimately helped bring about a free society, though critics point to the brutal repression and high social cost associated with the dictatorship.
• Criticism and controversy: The connection between Friedman and Pinochet is a subject of ongoing debate, with critics highlighting the human rights abuses under Pinochet's regime while noting his government was implementing Friedman's free-market principles. 
• Fonte: IA