For a moment last weekend, everything seemed right in Chile. The slender nation straddling the Andean cordillera had just won the Copa America ― beating powerhouse Argentina, even ― for the first time in the tournament’s 99-year history. More than a trophy was at stake.

Defenseman Jorge Rojas put it neatly: “We have always been hit by tragedies. We deserved to enjoy this happiness.”

Unfortunately, that may be brief solace for this nation of 17 million, which has been battered by floods, drought, earthquakes, and volcanic eruptions ― and now a sharp economic downturn, hastened by a slowdown in China.

Yet many of Chile’s current miseries also are homemade. Start with the scandal over influence-peddling and campaign financing that has spread through congress, boardrooms and President Michelle Bachelet’s family, forcing her son to resign as her director of social and cultural affairs. This affair may look almost chaste against the mammoth graft and kickback scheme at Brazil’s oil company, Petrobras, but it has shaken a nation unaccustomed to such blatant public corruption.

Worse, just as Bachelet ― a leader widely regarded for her honesty ― scrambled to make things right by sacking most of her cabinet and rolling out anti-corruption measures, the economy took a hairpin turn for the worse.

Consumer spending is down, prices are rising, jobs are vanishing and, as Bloomberg News’s Javiera Quiroga reported, neither the generous injections of fiscal stimulus nor eight consecutive cuts in bank lending rates have reversed the slide.

Bachelet’s finance minister Rodrigo Valdes warned that the fiscal deficit must be “narrowed” and “dialogue” with the business sector improved. “The good news is that we are reacting as a country, putting growth back at the center of the agenda,” Valdes told the Financial Times this week.

We’ll see. Bachelet surged to power on a bubble of hope in a country blessed by two decades of stability and rising prosperity, but anxious for something bolder. That’s what drove millions of university students to the street between 2011 and 2013 and pushed then-president Sebastian Pinera, a market-friendly conservative, to the wall. Bachelet felt their pain and rode the students’ demand for free, universal education into office.

To pay for that benefit and other goodies, she proposed a fat tax hike and a constitutional reform sweeping away the labor laws passed by Gen. Augusto Pinochet, one of the world’s most odious dictators.

Chileans seem less enthusiastic. A June survey showed that just 28 percent of Chileans wanted to give more rights to trade unions, 27 percent supported her plan to raise the tax burden by three percent, and 24 percent backed the tuition-free kindergarten-to-college education reform.

Now Bachelet is trapped between the public and protestors. Elected in late 2013 with 62 percent of the vote, her ratings sank to 23 percent in June, rising slightly in the afterglow of Copa America.

She might take a cue from her country’s worst moment. Pinochet waged one of Latin America’s bloodiest dirty wars against dissenters but also retrieved the economy from populist ruin with aggressive, free-market policies.

In time, Chileans split the difference, ousting the generalissimo while preserving his market-friendly rules, softening capitalism’s bite with social spending. That was the script of the Concertacion, an ecumenical, center-left coalition that kept the peace from 1990 to 2010, and made Chile’s democracy a continental benchmark.

Extreme poverty fell from 20 percent to two percent from 1990 to 2013 and per capita income is $21,700, Latin America’s highest, the World Bank reports.

Those centrist policies fell out of fashion, but their revival could be just what’s needed in this Latin American outlier, which found a way to move forward between despots and demagogues.

Chileans are right to want more than to be the best address in a bad neighborhood, as Bloomberg’s Eduardo Thomson put it. They want to change without losing what’s made them shine.

By Mac Margolis, Bloomberg

Mac Margolis is a Bloomberg View contributor in Rio de Janeiro. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners. ― Ed.