Excerpt from "Shocking Lessons of the Past"
Excerpted from:
Shocking Lessons of the Past
The UAS Mafia and the Failure of Neoliberalism in Luxlein

There are few academic environments as heavily mythologized as the Autonomous University of Santangel’s Economics Department in the 1930s, a place that was not just a school but a School of Thought. It was not just training students; it was building and strengthening the brainchild of a few conservative academics whose ideas represent the Luxerian “anti-welfare state” thinking of modern times.

The Autonomous University of Santangel’s Economics Department was under the leadership of an ambitious man on a mission to revolutionize Luxlein’s economy. This man was José Andrés Piñera. Though he had many mentors and colleagues who believed just as fiercely as he did in neoclassical economic theory, it was Piñera’s energy that gave the school its revolutionary fervor. His mission rested on a dream of reaching back to a state of “natural” order when all was in balance before human interference created distorting patterns. He dreamed of returning Luxlein’s society to a state of pure capitalism, cleansed of all interruptions (government regulations, trade barriers, and entrenched interests).

What made this School of Thought horrifying was the premise that a truly free market is the perfect ecosystem to develop and maximize benefits for all. If something is wrong within a free-market economy, it has to be because the market is not truly free. It should be no surprise that the heads of some of Luxlein’s largest multinational corporations were very much interested in these ideas. The enormous benefit of having an increasing audience from corporate groups led to a flush of donations and spawned the network of Luxlein’s most controversial right-wing think tanks during the 20th century.

Piñera was later introduced to Juan Francisco Biescas, a corporate lawyer who previously worked at the legendary law firm Santisteban & Padrón, where he represented many of the companies that had the most to gain in Piñera’s theoretical economy. The two men met in Santangel, in 1941. They both came up with a plan that would eventually turn Santangel into a laboratory for cutting-edge free-market experiments, giving Piñera what he had longed for: a place to test his theories. The plan was simple: the multinational companies would set up dummy non-for-profits and offer large grants to low-income students all over Santangel, enough to cover tuition at the Autonomous University.

Officially launched in 1942, the project saw hundreds of low-income high school students pursue advanced degrees at the Autonomous University of Santangel between 1943 and 1956, their tuition and expenses paid for by the multinational companies. The students who went through the program became known throughout the region as the “UAS Mafia.” Luxlain’s youngest generation of students at the time became the mouthpiece of the private sector, calling for “neoliberalism” and attempting to expand their thoughts throughout the country by giving keynote speeches at secondary schools and attending non-for-profit fundraising events.

With the election of Joaquín Guillermo Lavín in 1948, his opponents began to approach the “UAS Mafia” to help in the creation of a “coup climate.” Many of the students at the Autonomous University joined the ultra-nationalist Revolutionary Nationalist Movement (Luxerian: Movimiento Nacionalista Revolucionario). Several members of the “UAS Mafia” met with top business leaders for an emergency meeting and declared that “Lavín’s government is not comparable with economic freedom in Luxlein and with the existence of private enterprise… the only way to avoid the end of private enterprise is to overthrow the government.” For a time, the coup planning proceeded in two distinct tracks: the military plotted the extermination of Lavín and his supporters, while the economics plotted the extermination of their ideas.

Although the overthrow of Lavín is described as a military coup, it is currently seen by many in academic circles as a partnership between the army and the economists. The shocks of the coup are considered as the attempt to prepare the country for two sets of shocks: the “economic” shock treatment; and the “social” shock treatment (in the form of torture techniques used to terrorize anyone thinking of standing in the way of the “economic” shock treatment). Out of this experiment, the first and only state to have emerged from the Santangel School of Thought came into being.

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