Money and Sovereignty: The Chilean Case in the Twentieth Century

Recent historical events make Chile a good case study to approach alternative understandings of money governance and compare it to the neoliberal one, for which the State plays mainly a supervisory role over the financial system. In particular, I intend to revisit its relationship to sovereignty by studying the socialist government of Salvador Allende (1970-1973).
The Chilean road to Socialism considered the banking and credit system to be strategic for their social revolutionary endeavours and had a successful beginning. By the end of the first year of government, along with the nationalization of copper, more than 90% of the banking system was under state control.
The tragic ending of this so-called socialist experiment is well known, but its lessons in terms of money governance have been neglected. Analyzing the Chilean experience of money governance may help understand money’s relation to the political and constitutional order, and challenge the orthodox view of its ‘nature’.