President Bush calls Chile's partially privatized social security system a "great example" for the USA and also touts it as "a great example" for
other countries. On the surface, Chile's system appears to be generating high returns, but it costs much more than was estimated, and many Chileans
are far worse off than they would have been with the old system. The main drain on contributors is the high fees on corporate Pension Funds. A
government official specializing in pension issues fears retaliation from corporate interests, and only would speak anonymously, "If people really
had freedom of choice, 90 percent of them would opt to go back to the old system."
...Nearly 25 years ago, Chile embarked on a sweeping experiment .....Rather than finance pensions through a system to which workers, employers and
the government all contributed, millions of people began to pay 10 percent of their salaries to private investment accounts that they controlled.
Under the Chilean program - which President Bush has cited as a model for his plans to overhaul Social Security - the promise was that such
investments, by helping to spur economic growth and generating higher returns, would deliver monthly pension benefits larger than what the traditional
system could offer.
But now that the first generation of workers to depend on the new system is beginning to retire, Chileans are finding that it is falling far short of
what was originally advertised under the authoritarian government of Gen. Augusto Pinochet.
Only half of (Chile's) workers are captured by the system. ...Even many middle-class workers who contributed regularly are finding that their private
accounts - burdened with hidden fees that may have soaked up as much as a third of their original investment - are failing to deliver as much in
benefits as they would have received if they had stayed in the old system.
"What we have is a system that is good for Chile but bad for most Chileans," said a government official who specializes in pension issues and who
spoke on condition of anonymity, fearing retaliation from corporate interests. "If people really had freedom of choice, 90 percent of them would opt
to go back to the old system."
This leaves many Chileans in a situation that has led to the coining of a phrase: "pension damage." There is now even an Association of People With
Pension Damage, ....."They come to us in desperation," said Yasmir Farina, the group's president, "because those who stayed in the government
system are often retiring with monthly pensions twice as large as everyone else's."
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The Bush plan for privatized Social Security paves the road for America's official return to serfdom and peasant-dom. Only the middlemen have
changed: instead of kings and aristocrats, our masters are the new corporate nobility. The bankers still call the shots, control the game and reap the
real profits. And once again, working people bear the real burden.
George Orwell predicted the regression and summed it up best in Animal Farm:
"Let us face it: our lives are miserable, laborious and short. We are born, we are given just so much food as will keep the breath in our bodies, and
those of us who are capable of it are forced to work to the last of our strength; and the very instant our usefulness has come to an end we are
slaughtered with hideous cruelty."
...With our permission, "democratically" contrived.
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[edit on 27-1-2005 by Banshee]