The Pincohet's regime support for "free market" capitalism did not prevent it organising a massive bail-out of the economy during the 1982 recession -- yet another example of market discipline for the working class, welfare for the rich. As was the case in the USA and the UK.
The ready police repression (and "unofficial" death squads) made strikes and other forms of protest both impractical and dangerous. The law was also changed to reflect the power property owners have over their wage slaves and the total overhaul of the labour law system which took place between 1979 and 1981 aimed at creating a perfect labour market, eliminating collective bargaining, allowing massive dismissal of workers, increasing the daily working hours up to twelve hours and eliminating the labour courts. Little wonder, then, that this favourable climate for business operations resulted in generous lending by international finance institutions.
Of course, the supporters of the Chilean "Miracle" and its "economic liberty" did not bother to question how the suppression of political liberty effected the economy or how people acted within it. They maintained that the repression of labour, the death squads, the fear installed in rebel workers would be ignored when looking at the economy. But in the real world, people will put up with a lot more if they face the barrel of a gun than if they do not. And this fact explains much of the Chilean "miracle." According to Sergio de Castro, the architect of the economic programme Pinochet imposed, dictatorship was required to introduce "economic liberty" because:
"it provided a lasting regime; it gave the authorities a degree of efficiency that it was not possible to obtain in a democratic regime; and it made possible the application of a model developed by experts and that did not depend upon the social reactions produced by its implementation."
In other words, "economic liberty" required rule by technocrats and the military. The regime's pet "experts" used the Chilean people like laboratory rats in an experiment to make the rich richer. This is the system held up by the right as a "miracle" and an example of "economic liberty." Like the "economic miracle" created by Thatcher, we discover a sharp difference between the facts and the rhetoric. And like Thatcher's regime, it made the rich richer and the poor poorer, a true "miracle."
So, for all but the tiny elite at the top, the Pinochet regime of "economic liberty" was a nightmare. Economic "liberty" only seemed to benefit one group in society, an obvious "miracle." For the vast majority, the "miracle" of economic "liberty" resulted, as it usually does, in increased poverty, unemployment, pollution, crime and social alienation. The irony is that many on the right point to it as a model of the benefits of the free market.