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2Neoliberal Reinvention of Inequality inHealth in Chile 1 María Eliana LabraThe state of compromise and health policiesUnder a conservative pressure in 1924, Mandatory Workers’ Insurance(Social Security) was introduced in Chile. It was designed to protect the "manual"workers (blue-collars) of the formal market against the risks of old age, disabilityand illness. Consequently, the more affluent sectors and the public andprivate employees (white-collars) were left with pension funds for individual capitalization.Social Security offered ambulatory medical attention and hospitalization carein establishments of the so called Public Charity, a colonial institution for indigents.In terms of Public Health infrastructure, these programs were implementedby diverse state jurisdictions. The Armed Forces had (and still has) itsown prevention and assistance regimes. Private medicine lacked gravitation andits later development was very limited.The institution of Social Security in Chile coincides with the change fromoligarchy to the Modern State and the promulgation of the Liberal Constitutionof 1925, which assured civil, political and social rights, and established as a dutyof the State, maintaining a national public health service. This determination wasinfluenced by the Rockefeller Foundation and the Pan-American Sanitary Officewho felt that Latin-American governments should organize public health in acentralized way, headed by a public health specialist.By the end of the turbulent 20’s and the beginning of the 30’s, a politicalparty system conformed by right, center and left-wing forces took shape. Thesewere governed by means of delicate compromise arrangements until the brutalrupture of 1973. From one perspective, the parties constituted the axis of the23