This book examines an aspect of Chilean politics and history that most specialists tend to ignore. Relying largely on two case studies—hydroelectric and forestry projects in land occupied by the Mapuche people—Diane Haughney sets out to investigate whether the current democratic regime has kept its promise to recognize their demands and aspirations. Her findings are, unsurprisingly, negative. The leaders of Concertación—the center-left coalition that has ruled the country since 1990—have sacrificed the interests of the Mapuche people because of their commitment to neoliberalism.

In order to introduce the case studies the author offers a succinct account of the political struggles of the Mapuche people. This is the largest indigenous group in Chile, comprising, according to Haughney, between 4% and 10% of the population. Historically, their territory was located to the south of the Bíobío River. They heroically resisted colonial occupation and, as a result, in 1641 the Spanish crown recognized their territorial rights. Upon independence, in 1818, the Mapuche retained control over their territory, but not for long. By the mid-nineteenth century, the local elites had launched a campaign to occupy their land. Initially, the government set up a legal scheme to enable speculators to acquire land from the Mapuche. When this scheme failed, it launched a vicious military campaign that lasted 15 years and resulted in the death of hundreds of Mapuche, the destruction of their way of life, and the expropriation of most of their land. After their defeat, some of the Mapuche were granted smallholdings—called mercedes—but more than 30% had to leave their ancestral lands to become farm laborers or domestic servants.

Except for a brief interlude during the reform-minded administrations of Eduardo Frei (1964–70) and Salvador Allende (1970–73), the policy of the Chilean state toward the Mapuche has been characterized by economic neglect and social discrimination. But even during this brief interlude, the overriding aim of the state remained unchanged: to turn them into citizens, albeit second class, thus denying their identity as a people. Under the dictatorship of Augusto Pinochet, the government officially proclaimed that there were no indigenous people in Chile and that the status of the Mapuche as an ethnic group was irrelevant for the allocation of property over land.

The return to democracy in 1990 brought about expectations that the state would recognize the rights of the Mapuche people and their separate identity. These expectations, however, did not materialize. Although in 1993 the government secured the approval of legislation that prohibited the sale of indigenous lands to nonindigenous persons and recognized cultural diversity, these noble aspirations were soon forgotten.

More than half this book is devoted to a detailed description and analysis of the various strategies employed by state institutions and the private sector to prevent the Mapuche from effectively relying on the 1993 legislation to resist the implementation of hydroelectric and forestry projects, which undermined their rights. According to Haughney, the administration of President Eduardo Frei Ruiz-Tagle blatantly disregarded the legal provisions designed to protect indigenous subsistence land, put huge pressure on government agencies to approve the projects, dismissed government officials who sympathized with the plight of the indigenous communities, and distorted the process of environmental impact evaluation. Moreover, after the Court of Appeals of Concepción ruled against one of the projects on a matter concerning water rights, the National Energy Commission, one of the leading state agencies involved in this process, issued an alarmist statement claiming that if the project were not allowed to go forward, electricity prices would increase by 46%. Shortly thereafter, the Supreme Court reversed the Court of Appeals decision. Inevitably—as it is often the case in projects of this type—the World Bank was also involved as it had provided a loan of $170 million. According to Haughney, the bank, together with the government, refused to disclose the findings of the environmental assessment until the project had been approved by the relevant government agencies and the decisions became irrevocable. This episode so embarrassed the bank that in 1998, James Wolfensohn, the bank's president, publicly apologized for the damages that the project had caused to the indigenous people. No such apology came from the Chilean government. On the contrary, when President Frei inaugurated the main hydroelectric project, he declared that the exploitation of the country's hydroelectric supply was a matter of national security.

The link that President Frei made between these projects and national security suggests that perhaps Haughney's argument that the government betrayed the Mapuche people because of its enthusiasm for neoliberalism is somewhat overstated. Her own historical account shows the Mapuche never managed to forge effective political alliances with political parties, either of the Right or the Left. Indeed, since independence, one of the defining features of the Chilean political elites has been their unequivocal tendency to favor stability and strong institutions, even if it entailed sacrificing other ideological objectives. This feature of the political elites' behavior goes a long way toward explaining the early consolidation of the state in the nineteenth century and the country's remarkable political stability during most of the twentieth century. Given this political milieu, the struggle of the Mapuche for recognition as a people never had much of a chance, regardless of the economic ideology of those in power. Thus, in order properly to understand their plight, it is necessary to complement the study of policy decisions by recent administrations with an analysis of the evolution of state institutions.

Haughney's detailed account of the frustrated attempts of the Mapuche to defend their rights should be of great interest to scholars seeking to understand the plight of indigenous communities in Latin America and other developing countries. Unfortunately, however, she does not explore the implications for her case study of the current academic debate on the tension between demands for equal citizenship and demands for the recognition of group rights and cultural identity. This debate—prompted largely by the emergence of ethnic-based political movements in several Latin American countries, including Bolivia, Ecuador, Guatemala, and Mexico—offers valuable insights for understanding the relationship between neoliberal policies and indigenous people. Although Haughney includes in her bibliography the work of some of the prominent protagonists of these debate, such as Deborah Yashar, June Nash, and Donna Lee Van Cott, she does not engage with their theoretical arguments. As a consequence, although it is difficult not to share her pessimism about the political prospects of the Mapuche in Chile, it is also difficult to agree that neoliberal economics is the sole factor accounting for this outcome.

Despite these reservations, Haughney's book is a sharp reminder that though most governments in the region have embraced a progressive discourse on indigenous people, their policies have not significantly changed. Indeed, her analysis of the 1993 legislation offers an excellent illustration of this contradiction. Although this piece of legislation was far from perfect, neither the government nor private investors took it seriously. Thus, it is small wonder that despite the efforts of international agencies to spread the rule of law and democracy, the poor and marginal people in Latin America remain skeptical about the virtues of democracy and the rule of law.