From Volume 38, Issue 41 of EIR Online, Published October 21, 2011

Ibero-American News Digest

Bury Chile's Private Pension System!

Oct. 16 (EIRNS)—A coalition of citizens, legislators and trade unions are demanding the scrapping of Chile's private pension, or AFP system, and a return to the state-run system that existed prior to 1981, when the fascist Pinochet dictatorship privatized it.

At the time, millions of Chileans were forced into the privatized system, while the military junta confiscated billions of dollars deposited in the public system. Only the Armed Forces were given the option of remaining in the public system.

The coalition charges that Chileans were defrauded by José Piñera, Pinochet's Labor Minister in 1981 (and brother of the current President Sebastián Piñera), who promised that under the private AFP system, they would receive pensions equivalent to 75% of their salaries. Instead, the average worker enrolled in the private system today, receives a pension that is three to four times lower than what they would have received under the state system.

As Christian Democratic Sen. Mariano Ruiz Esquide put it, there is no reason for workers' savings and pensions to be managed by private financial institutions, and subjected to the volatile goings-on of the market.

In 2005, the LaRouche movement, with the help of allies in Chile, successfully sabotaged George W. Bush's attempt to impose the same private Chilean Social Security model on the United States.

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