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Chilean President Michelle Bachelet signed into law last month the most significant educational reform the country has seen in 30 years.

Enacted after an eight-month legislative battle, the new law will gradually ban profits, tuition fees, and selective admissions practices in privately-owned primary and secondary schools that receive state subsidies.

The long-awaited education reform — preceded by a corporate tax rise that will raise US$8 billion a year for education and other social programs — addresses a key promise made by Bachelet and her centre-left New Majority coalition during the 2013 electoral campaign.

It has been widely hailed as a big step towards dismantling the market-based and socio-economically segregated education system, a legacy of the 1973-1990 Pinochet dictatorship.

Chilean NGO Educacion 2020, a key actor in developing the reform package, said: “This law changes the Chilean education system, the most commodified in the world, by transforming education from a consumer good to a social right.”

As expected, the protracted legislative battle over the New Majority’s education reform galvanised strong opposition from conservative sectors. But dissent has also come from less expected quarters: the highly-organised Chilean student movement.

“This is not the reform we mobilised for,” insisted the University of Chile Student Federation (FECH), which spearheaded the huge 2011-13 demonstrations that catalysed popular demands for education reform and paved the way for the New Majority’s electoral victory.

Gabriel Boric, one of four student leaders elected to Congress in 2013 said: “We have wasted a historic opportunity for educational reform, and also deeply damaged our democracy.”

Boric nevertheless voted for the reform.

To appreciate these surprisingly dissident perspectives, the new education reforms must be viewed in a broader historical context. The wholesale conversion of Chile’s system of universal, free, public education to a privatised, deregulated, demand-driven scheme, which began under Pinochet, was consolidated by subsequent democratic regimes.

At the primary and secondary level, public schools have been systematically undermined by a municipalisation strategy. This generates widely disparate funding levels between jurisdictions. Private schools have also been created that compete with public ones for state voucher subsidies.

Today, as resource-starved public schools continue to decline in quality, only 37% of Chilean students are enrolled in them — down from 80% in 1980.

Private schools with state subsidies are the fastest growing sector, representing 56% of enrolment. Of these, one-third are non-profit (primarily owned by religious institutions) and two-thirds are for-profit. The remaining 7% are private with no state subsidies.

Most for-profit subsidised schools also charge tuition, and select students based on their socio-economic status, test scores, and performance. As a result, each student buys the education that he or she can afford, and 44% of students — largely from poor neighbourhoods and villages — do not complete high school.

Yet even in the most selective institutions, students test well below average for the 34 developed nations that belong to the Organization for Economic Cooperation and Development (OECD), due to the lack of quality control of schools, teachers, and teacher training.

At the higher education level, 80% of Chilean students now attend private universities or technical institutes. These schools are the most expensive in the world, relative to per capita income.

Students pay tuition at public universities, too, a situation relatively unique for Latin America.

Chilean universities are technically required to operate on a non-profit basis, but recent investigations have documented illegal strategies used to divert funds for private gain. These include service contracts and land or infrastructure leases with related for-profit entities.

Universities are also highly segregated. Admission exams disadvantage poor students from lower-quality high schools and channel them to “storefront” institutes, where roughly half drop out with high debt burdens.

Top-ranked schools, including state-subsidised public universities, are available only to elite students.

The result, according to Educacion 2020, is a system of “educational apartheid” that is among the worst in the world. It reinforces and reproduces inequality in a country which has the most unequal income distribution among OECD member states.

Bachelet’s reforms, which seek to decommodify privatised primary and secondary education, are aimed at one portion of this repressive system.

They will require owners of for-profit elementary and high schools to convert to non-profit status, and to admit students by lottery instead of discriminatory selection. Tuition fees will gradually be replaced by increased state subsidies.

Students say the reforms do not go far enough, and may fall short even in meeting their stated objective. They point to loopholes that allow “flagship” schools to maintain selective admissions for up to 30% of their enrolment.

Non-profit schools can also retain transitional leasing arrangements with for-profit landlords. This legitimises continuing profits within the primary and secondary education system through the same subterfuges used by private universities.

The law, students note, also authorises new forms of profit-taking, through state-guaranteed loans to finance the sale of for-profit schools to non-profit operators at their subsidised market value.

The provision responds, in part, to a scare campaign mounted by the bill’s conservative opponents, who incited parents by raising the spectre of huge private school closings in response to the ban on profits. One newspaper advertisement in December read: “Private subsidised school for sale: 2000 students, excellent infrastructure, good parents, good teachers …”

Students also criticise Bachelet’s program for failing to restructure the decimated municipal public school system, improve teacher training, salaries and quality control of schools, or address their key demand for free, universal higher education.

Bachelet has promised extra legislation this year to deal with these issues, including free university education by 2020. But few details are forthcoming as of yet.

More fundamentally, the FECH and Boric say the reforms passed and contemplated so far do not break with the logic of the neoliberal education system, and may even serve to reinforce it. By enshrining the voucher system, they contend, the reforms will continue competition for enrollment and resources between public and private schools that has destroyed quality public education.

Indeed, Bachelet has marketed the education reform, in part, as a project to enhance “school choice” by removing cost and selectivity barriers. This is despite the public sector, under current conditions, being unable to provide a competitive alternative.

What’s needed, the FECH says, is a complete re-nationalisation and return of education to the public sector, with funding based on institutional need rather than demand.

This contrasts sharply with the views of Bachelet and Educacion 2020, who envision Chile’s reforms resulting in a mixed public-private non-profit system, similar to the Netherlands or Belgium, that remains demand-driven.

Ex-student leader-turned-legislator Camila Vallejo, from the Chilean Communist Party, has taken a more pragmatic stance. She has endorsed Bachelet’s gradualist program as the most practical way to eliminate profits in education without a huge spending of state resources.

Vallejo, who will chair the education commission in the Chamber of Deputies, will be in a key position to shape the New Majority’s future education agenda.

The upcoming legislative battle over higher education is expected to be much more contentious than last year’s. Its outcome will be strongly influenced by the student movement’s continuing ability to articulate and link popular demands to a broader structural analysis, using the creative tactics that have mobilised hundreds of thousands in the past.

The student movement appears to be at a crossroads. Huge demonstrations continued last year after Bachelet’s proposed reforms were announced, but the passage of the bill has demobilised some sectors and created new organisational challenges.

The movement encompasses diverse political tendencies, and continually struggles to define its complex relationship to electoral politics. Recent elections have split the student leadership between left-wing (FECH) and right-wing (Catholic University) factions, with the right-wing opposed to nationalisation of all universities.

On the other hand, FECH, the largest student group, has successfully united its three big political constituencies and is well-positioned to lead the upcoming battles.

Chilean students may be loath to claim Bachelet’s reforms as a partial victory. But their experience is teaching the world how mass popular movements can transform state policy, even if they can’t win everything at once.

It is also showing how difficult it is to truly dismantle the entrenched neoliberal educational model.

[Slightly abridged from . Emily Achtenberg is the author of NACLA’s blog.]

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