Roger Thayer Stone Center For Latin American Studies

Tulane University

Carmelo Mesa Lago discusses Pension Reform in Argentina, Bolivia and Chile

April 9th, 2013

On March 19, 2013, Tulane University's Center for Inter-American Policy welcomed back former Greenleaf professor Carmelo Mesa-Lago for a lecture entitled "Re-reforms of Privatized Pensions in Latin America: Argentina, Bolivia, and Chile." Mesa opened by explaining how eleven Latin American countries conducted structural reforms of their public pension systems during the 1980s and 1990s through either complete or partial privatizations. In the countries examined in his lecture, these reforms produced some positive changes but also several unsatisfactory outcomes that prompted Argentina, Bolivia, and Chile to implement substantial "re-reforms" in 2008 (Chile and Argentina) and in 2010 (Bolivia). Some of the negative outcomes of the initial reforms included the failure to successfully extend coverage for workers: coverage remained stagnant in Chile and Bolivia, while in Argentina it actually decreased by 45 percent. Other problems were the lack of gender equity and the failure of competition between private firms to effectively reduce administrative costs. The financial sustainability of the overall shift to privatized systems proved to be precarious. Transition periods were lengthy and costly, inducing large government debts. Capital returns in all three countries fell, the most drastic drop occurring in Chile, from 21 to 10 percent.

To remedy some of these negative outcomes Argentina, Bolivia, and Chile conducted "re-reforms", strengthening the role of the state in the pension system through diverse approaches. Chile maintained the privatized system but improved it; Argentina integrated the private system into the public system; and Bolivia nationalized its system. In terms of coverage, all three countries improved upon the previous system by extending coverage for the labor force and expanding coverage of non-contributory pensions. All three countries improved gender equity by compensating mothers for time spent raising children. In terms of financial sustainability, Mesa-Lago stressed that Chile had the greatest success in ensuring the long-term viability of its re-reforms, while the sustainability of the Argentine and Bolivian systems remain questionable. Capital returns have been increasing in Chile, while in Bolivia they have been falling, and in Argentina, they are negative. The deficit of Argentina's public fund is expected to increase five-fold over the next forty years, while in Bolivia, no long-term financial projections for the future of the state pensions fund have been established.

Mesa-Lago concluded by underscoring that the re-reforms have remedied many of the flaws of the initial privatization of pensions. He further emphasized that a one-size-fits-all approach with respect to pension reform is untenable because it fails to account for local specificities and internal dynamics of a given country. For example, while all three countries have expanded the role of the state in pensions, not all have pursued the outright closing of the private system. The Chilean case demonstrates how a privatized system can be maintained and substantially improved with state involvement. The case of Argentina demonstrates a successful example of integration of the private system into the public system, with the important caveat that other measures might have to be taken to ensure its long-term financial viability. Mesa-Lago added, as a final note, that it remains to be seen how these re-reforms will influence the complete or partially privatized pensions systems still in place in other Latin America countries.

-Hannagan Johnson

LATEST SITE UPDATES

MEDIA

EVENTS

NEWS

PEOPLE

BLOG POSTS

More

Upcoming Events

Bruno Bosteels speaks at Loyola University

View Full Event Description

The Center for Latin American and Caribbean Studies at Loyola University presents: “Politics and Violence in Latin America: Democracy in the Criticism of Arms,” a talk by Bruno Bosteels, Professor of Romance Studies at Cornell University. Bosteels is the author of Badiou and Politics, Marx and Freud in Latin America, and The Actuality of Communism, among other works.

For more information on this event, please contact Josefa Salmon at salmon@loyno.edu.

This event is sponsored by the Center for Latin American Studies and the Caribbean, The Languages & Cultures Department at Loyola University, Rev. Scott Youree Watson, Gregory F. Curtin & Rev. Guy Lemieux SJ SAK Distinguished Professorships.

For the event flyer, click here.

The Pebbles Center turns 10!

View Full Event Description

The Pebbles Center is celebrating its 10th Anniversary! The 10th anniversary falls on Dia, a celebration of children and reading. To celebrate, the Pebbles Center is hosting renowned children’s book author Jorge Argueta. Mr. Argueta was a guest at the inauguration of the Pebbles Center 10 years ago. See photographs from Mr. Argueta’s previous visit here. He will present an interactive presentation based on some of his most recent books.

Jorge Tetl Argueta is a celebrated Salvadoran poet and writer whose bi-lingual children’s books have received numerous awards. A native Salvadoran and Pipil Nahua Indian, Jorge spent much of his childhood in rural El Salvador. He feels that everybody is capable of writing, especially young children who are natural poets! Argueta has written a series of delicious cooking poems perfect for reading while cooking or incorporating food into the classroom. Come out and celebrate with us!

Children and parents will be able to enjoy a wonderful reading and a workshop highlighting the delicious foods found in his books. We will be of course providing snacks as well as be able to distribute a handful of bilingual books donated by the New Orleans Public Library.

El 30 de abril es una fecha muy significativa para los niños. Se celebra el día de los niños y de los libros. Esta celebración se conoce como El día de los niños/ El día de los libros, y celebra la alegría y las maravillas de la infancia y la importancia de los libros en nuestra vida. Ven a celebrar con nosotros el día con autor salvadoreño Jorge Argueta.

Para una lista con la dirreción de todas las bibliotecas, por favor visite la página de web de la biblioteca pública de la Nueva Orleáns.

For more information or if you have questions please contact the Latin American Resource Center at crcrts@tulane.edu or check our Facebook page.

Sponsored by the Stone Center for Latin American Studies, and the New Orleans Public Library.

Photo by Nina Menconi.

Art Syncopation

View Full Event Description

The Consulate of Mexico in New Orleans and the New Orleans Jazz and Heritage Festival are pleased to present an art exhibit of renowned artist Angel Gonzalez de la Tijera entitled “Art Syncopation.” An opening reception will be held on April 22nd at 6 PM. The exhibit will be on display through May 20th.

Angel Gonzalez de la Tijera is an important Mexican Painter and one of the most significant contributors to contemporary figurative Mexican art. His work primarily focuses on figures and portraits in conjunction with music. His art reveals form and substance in a realistic manner.

Gonzalez de la Tijera was born in Mexico City in 1958. He developed his painting style, figurative realism, as a student of master painter Santiago Carbonell.