The film is an extended metaphor of what happened in Chile in those days. One could see Raúl as an embodiment of the majority of Chileans, who turned a blind eye to Pinochet's abuses of power and went for easy escapism instead, provided by stupid television shows or the Hollywood dream factory. But the fact that Raúl is such a vile character, such a terrible bastard, points to a parallel with the dictator himself, killing and vanishing people with total impunity.
The violence in this film is brutal, swift and merciless. Raúl kills people with his bare hands. At the beginning he seems like a meek dreamer, but soon you realize he is full of rage. Several women find him irresistible, even as he debases them, and even as he is impotent. Maybe this too is symbolic of some people's acceptance of the Pinochet regime. There are intimations of a deeply divided society, of a racist streak through this society, and ultimately of a society disgusted with itself.
The movie is claustrophobic. It never leaves the poor working class slums where he lives. The colors are washed out, the camera is handheld all the time. The dark, bleak humor dries in your throat, the sex is brutal. Tony Manero is a nasty piece of work, but it recreates a nasty, evil time in Chilean history, and it doesn't let anybody off easy.