The cities of Latin America are littered with cardboard and packing-crate shantytowns that house hordes of landless peasants in search of jobs. Usually such squatters' settlements are either deliberately overlooked by officialdom or broken up by police within a few days. In the Chilean capital of Santiago, however, a luxuriantly mustached leftist named Victor Toro, 28, has founded a poblacion callampa ("mushroom town") that the government cannot ignore and the police cannot destroy.
Last Jan. 26, Toro led 3,000 of his followers onto a two-acre patch of land a few miles from Santiago's center. Then...