Chilean workers demand gov't-guaranteed pensions

Reuters/Rodrigo Garrido

“AFP: a starvation pension” and “AFP should die so that the retirees can live,” were among the signs carried by hundreds of thousands of workers, unionists, students and other protesters in 300 cities and towns across Chile Aug. 21, including Santiago, above. The privately run AFP, Pension Fund Administrators, was set up by the U.S.-backed Augusto Pinochet dictatorship in 1981 to get rid of social security.

Workers are required to deposit 10 percent of their wages into the accounts. The system was touted as a model of the superiority of the free market. The AFP investment companies take half of the workers' contributions as "fees" for their role in speculating in stocks and bonds with the funds. According to the Santiago-based Fundación Sol, 90 percent of retirees get less than $233 a month, well under the minimum wage of $380.

Protesters demand the private profit system be dismantled wholesale and replaced with government-guaranteed social security.

— SETH GALINSKY