In
1970 Salvador
Allende,
the leader of the Chilean Socialist Party, was elected president.
He therefore became the first Marxist in
the world to gain power in a free democratic election. The new government
faced serious economic problems. Inflation was running at 30 per cent
and over 20 per cent of the male adult population were unemployed.
It was estimated that half of the children under 15 suffered from
malnutrition.
Allende's
decide to take action to redistribute wealth and land in Chile.
Wage increases of around 40 per cent were introduced. At the same
time companies were not allowed to increase prices. The copper industry
was nationalized. So also were the banks. Allende also restored diplomatic
relations with Cuba, China
and