The Republic of Chile is a country in South America occupying a long coastal strip between the Andes mountains and the Pacific Ocean. It shares borders with Argentina to the east, Bolivia to the northeast and Peru to the north.
There are various theories about the origin of the word Chile. According to one theory the Incas of Peru, who had failed to conquer the Araucanians, called the valley of the Aconcagua "Chili" by corruption of the name of a tribal chief ("cacique") called Tili, who ruled the area at the time of the Incan conquest. Another theory points to the similarity of the valley of the Aconcagua with that of the Casma in Peru, where there was a town and valley named Chili. Other theories say Chile may derive its name from the indigenous Mapuche word chilli, which may mean "where the land ends" or "the deepest point of the Earth," or from the Aimara tchili meaning "snow"; another meaning attributed to chilli is the onomatopoeic cheele-cheele—the Mapuche imitation of a bird call. The Spanish conquistadors heard about this name from the Incas and the few survivors of Diego de Almagro's first Spanish expedition south from Peru in 1535-36 called themselves the "men of Chilli."
About 10,000 years ago, migrating Native Americans settled in fertile valleys and along the coast of what is now Chile. The Incas briefly extended their empire into what is now northern Chile, but the area's remoteness prevented extensive settlement.
Conquest of the land that is today called Chile took place only gradually, and the Europeans suffered repeated setbacks at the hands of the local population. A massive Mapuche insurrection that began in 1553 resulted in Valdivia's death and the destruction of many of the colony's principal settlements. Subsequent major insurrections took place in 1598 and in 1655. Each time the Mapuche and other native groups revolted, the southern border of the colony was driven northward. The abolition of slavery in 1683 defused tensions on the frontier between the colony and the Mapuche land to the south, and permitted increased trade between colonists and Mapuches.
The drive for independence from Spain was precipitated by usurpation of the Spanish throne by Napoleon's brother Joseph. A national junta in the name of Ferdinand—heir to the deposed king—was formed on September 18, 1810. The junta proclaimed Chile an autonomous republic within the Spanish monarchy. A movement for total independence soon won a wide following. Spanish attempts to reimpose arbitrary rule during what was called the Reconquista led to a prolonged struggle.
Intermittent warfare continued until 1817, when an army led by Bernardo O'Higgins, Chile's most renowned patriot, and José de San Martín, hero of Argentine independence, crossed the Andes into Chile and defeated the royalists. On February 12, 1818, Chile was proclaimed an independent republic under O'Higgins' leadership. The political revolt brought little social change, however, and 19th century Chilean society preserved the essence of the stratified colonial social structure, which was greatly influenced by family politics and the Roman Catholic Church. The system of presidential absolutism eventually predominated, but wealthy landowners continued to control Chile.
Toward the end of the 19th century, the government in Santiago consolidated its position in the south by ruthlessly suppressing the Mapuche Indians, finally completing the conquest begun more than three centuries earlier. In 1881, the government signed a treaty with Argentina confirming Chilean sovereignty over the Strait of Magellan. As a result of the War of the Pacific with Peru and Bolivia (1879-83), Chile expanded its territory northward by almost one-third and acquired valuable nitrate deposits, the exploitation of which led to an era of national affluence. Chile established a parliamentary style democracy in the late 19th century, but degenerated into a system protecting the interests of the ruling oligarchy. By the 1920s, the emerging middle and working classes were powerful enough to elect a reformist president, whose program was frustrated by a conservative congress. In the 1920s, Marxist groups with strong popular support arose.
In 1970, Senator Salvador Allende Gossens, a Marxist physician and member of Chile's Socialist Party, who headed the "Popular Unity" (UP or "Unidad Popular") coalition of the Socialist, Communist, Radical, and Social-Democratic Parties, along with dissident Christian Democrats, the Popular Unitary Action Movement (MAPU), and the Independent Popular Action, won a plurality of votes in a three-way contest. The Chilean Congress conducted a runoff vote between the leading candidates, Allende and former president Jorge Alessandri and chose Allende by a vote of 153 to 35.
Allende's program included advancement of workers' interests; a thoroughgoing implementation of agrarian reform; the reorganization of the national economy into socialized, mixed, and private sectors; a foreign policy of "international solidarity" and national independence; and a new institutional order (the "people's state" or "poder popular"), including the institution of a unicameral congress. The Popular Unity platform also called for nationalization of foreign (U.S.) ownership of Chile's major copper mines.
An economic depression that began in 1967 peaked in 1970, exacerbated by capital flight, plummeting private investment, and withdrawal of bank deposits by those opposed to Allende's socialist program. Production fell and unemployment rose. Allende adopted measures including price freezes, wage increases, and tax reforms, which had the effect of increasing consumer spending and redistributing income downward. Joint public-private public works projects helped reduce unemployment. Much of the banking sector was nationalized. Many enterprises within the copper, coal, iron, nitrate, and steel industries were expropriated, nationalized, or subjected to state intervention. Industrial output increased sharply and unemployment fell during the Allende administration's first year.
Other reforms undertaken during the early Allende period included redistribution of millions of hectares of land to landless agricultural workers as part of the agrarian reform program, giving the armed forces an overdue pay increase, and providing free milk to children. The Indian Development Corporation and the Mapuche Vocational Institute were founded to address the needs of Chile's indigenous population.
The nationalization of U.S. and other foreign-owned companies led to increased tensions with the United States. The Nixon administration brought international financial pressure to bear in order to restrict economic credit to Chile. Simultaneously, the CIA funded opposition media, politicians, and organizations, helping to accelerate a campaign of domestic destabilization. By 1972, the economic progress of Allende's first year had been reversed and the economy was in crisis. Political polarization grew, and large mobilizations of both pro- and anti-government groups became frequent, often leading to clashes.