Tuesday, 11 March 2008

Monday, 10th March 2008


On the other side of the Atlantic, President Nicolas Sarkozy of France has urged Europeans to stop being naïve about trade and to develop "a real system of community preferences" to protect European Union agriculture and industry from unfair competition.

The trade organization's director general, Pascal Lamy, says the downturn on both sides of the Atlantic should focus minds on the benefits of a trade agreement, not least because failure would damage confidence in the world economy. Keith Rockwell, a spokesman for the agency, said, "Do you fix the roof when the sun is shining or when it's raining? Either way, it's still a good idea to fix the roof."
As with climate change, a trade deal requires concessions from big emerging nations like India, Brazil and China, which want to be able to protect key sectors of their economies from competition from rich countries.
Those conflicts seriously threaten the trade talks, as does the reluctance of wealthy nations to reduce radically the longstanding protection of their farmers.

Ministers want more done about warming
Signaling a significant departure from the Southern Baptist Convention's official stance on global warming, 44 Southern Baptist leaders have decided to back a declaration calling for more action on climate change, saying its previous position on the issue was "too timid."
The largest denomination in the United States after the Roman Catholic Church, the Southern Baptist Convention, with more than 16 million members, is politically and theologically conservative. Yet its current president, the Reverend Frank Page, signed the initiative, "A Southern Baptist Declaration on the Environment and Climate Change."
Two past presidents of the convention, the Reverend Jack Graham and the Reverend James Merritt, also signed, as did presidents of seminaries and Baptist colleges, editors of Baptist newspapers and pastors of churches, many of them in the younger generation of Baptist leaders.
"We believe our current denominational engagement with these issues has often been too timid, failing to produce a unified moral voice," the church leaders wrote in their new declaration.


Germany emitted fewer gases responsible for global warming in 2007, as it used less oil in favor of other energy sources signalingit could meet Koyoto commitments on climate change.

Germany, which has the largest economy in Europe, pledged in 1990 to decrease emissions by 21 percent and the current numbers would have it 0.6 percent away from achieving that goal.




(Photograph of Catherine Deneuve sitting on Vitton luggage on a film set train platform)

Sometimes, home is just a feeling.
Take three, last day of shooting. Paris.


Catherine Deneuve and Louis Vitton are proud to support The Climate Project.

Almost all of the Iraqi government's revenues come from oil exports. They totaled $39.8 billion last year, the government says, accounting for about 95 percent of its income. So it is not surprising that the oil minister, Hussain al-Shahristani, has been acting as though every barrel not exported is money wasted.
But that attitude, and the tacit approval of Maliki, is helping to prolong the economic, social and security quagmires that continue to afflict the country. All over Iraq, generating plants sit idle for lack of fuel. The State Department estimates that on a typical day about 1,500 megawatts of power, or one-third of the country's peak output, are unavailable because the Electricity Ministry cannot get enough fuel.
While the Oil Ministry swells the government coffers, hospitals, water-pumping stations and sewage systems function sporadically or not at all. And now countless Iraqis are preparing for yet another summer of sweltering nights and spoiling food.
The Oil Ministry's also refuses to pay for any oil-related projects that do not help the cause of exporting more crude oil. "The Oil Ministry has done zero projects to benefit electricity," an American diplomat in Baghdad told me. "They couldn't care less."


Gusher of Lies The Dangerous Delusions of Energy Independence By Robert Bryce 371 pages. $26.95. Basic Books.
In "Gusher of Lies," Bryce, a freelance journalist specializing in energy issues, mounts a savage attack on the concept of energy independence and the most popular technologies currently being promoted to achieve it. Ethanol? A scam. Wind power? Sheer fantasy. Solar power? Think again.
For the foreseeable future, which is to say the next 30 to 50 years, fossil fuels will reign supreme, as they have for the last century. Deal with it.

Yes, the United States depends on foreign oil and natural gas, but only 11 percent of its oil came from the Gulf in 2005. It imports 80 percent of its semiconductors and 100 percent of strategic minerals like bauxite and manganese.

Bryce then gets to work demolishing cherished green beliefs about alternative energy sources. Ethanol, in particular, drives him wild. Fuel derived from corn has channeled billions in subsidies to Midwestern farmers and agribusiness, he writes. It is expensive to produce and requires enormous amounts of water when irrigation comes into play. It produces much less energy than gasoline while emitting more pollutants into the air.
Detroit loves ethanol because it can use it to inflate fuel-efficiency ratings on its cars. The mammoth Chevy Suburban, produced as a flex-fuel vehicle capable of burning both ethanol and gasoline, magically boosted its fuel efficiency to 29 mpg from 15, since under federal rules only a vehicle's gasoline consumption need be factored into the equation. Ethanol, in other words, has allowed U.S. car manufacturers to produce more gas guzzlers and contribute to increased imports of oil.

Bryce's pet idea, though, is something that does not exist - a superbattery capable of storing large quantities of electricity. To bring this "silver bullet" into existence Bryce proposes a Superbattery Prize awarded either by the Energy Department or private foundations: $1 billion, say, for a compact, affordable system that can store multiple kilowatt-hours, and $10 billion for a system that can store megawatt-hours. Bryce reveals himself in the end as something of a visionary and perhaps even a revolutionary. Power to the people.

With oil soaring to a record $108 a barrel amid mounting signs of U.S. economic turbulence, President George W. Bush said Monday that he was sending Vice President Dick Cheney to the Middle East to raise concerns about oil prices and to press Israeli and Palestinian leaders to move toward peace.

"When you win more votes and more seats, you have to govern better," Zapatero said at his party's headquarters.

"The words of President Bush were very convincing," he [Prime Minister Donald Tusk of Poland] said through an interpreter after leaving the White House. "This is a politician, who is controversial for some but in my opinion is very trustworthy. I believe that is extremely important in the world of politics."

Students at the Gnesin Academy of Music, one of Russia's most prestigious music schools, took the increasingly tense real estate battles between artists and officialdom in Moscow to a new level Monday, organizing a surprise protest in one of the city's busiest shopping malls to draw attention to their plight.

"Our dormitory, located near the metro, has become an attractive morsel for the commercial structures of the city of Moscow. On March 11, the prosecutors' office and court marshals will kick us out of our home along with our things and all of our instruments."
The leaflets continued: "By selling our dormitory they are selling the culture of our country. They are selling the future of Russia!"

A protest was held last month outside a school affiliated with the Gnesin Academy. A plan to upgrade the school's facilities was approved by the city in 2001, but had stalled even though it received a push from President Vladimir Putin in 2006, said Mikhail Khokhlov, the school's director.
Students took the tack of making the protest on Feb. 24 something of a pro-Putin rally, chiding officials for subverting his orders.


"Voters sent a message to the president but they also sent a message to us," Jean-Marc Ayrault, president of the Socialists' parliamentary group and the freshly re-elected mayor of the western city of Nantes, said in a telephone interview. "The French want a serious opposition party. They told us on Sunday: Be more united and give us better ideas."

For all her years on the public stage, Clinton has never come close to assembling and running an enterprise like the 700-person, $170 million-and-counting campaign organization that she has created. At times, her aides made assumptions about tactics and voters that turned out to be wrong. They nearly ran out of money at all the wrong times, like just after Clinton's victory in the New Hampshire primary and right before the 22 state nominating contests on Feb. 5.

ALBANY, New York
The idea that Governor Eliot Spitzer — the square-jawed clean crusader who promised to bring ethics to Albany, the former prosecutor who chased corruption on Wall Street so ferociously that people nicknamed him Eliot Ness — was somehow ensnared in a prostitution scandal was too much. New Yorkers who thought they had heard everything were, for a change, dumbfounded.
They had trouble folding their minds around what law enforcement officials said was contained in a federal affidavit — that Spitzer, identified only as Client 9, had arranged for a high-priced prostitute to meet him in Washington on the night before Valentine's Day.


Last year, The New York Times Co. fended off a major investor who complained of poor decision-making and was bent on shaking up the company. This year, management is facing another challenge from dissident investors with similar criticisms.
But this one may not be so easy to rebuff.
The funds are challenging the company's investment decisions, including its commitment to the struggling newspaper industry beyond the flagship New York Times. Like many analysts, they see The Boston Globe and a group of 15 local papers as a drain on the company, which should, they argue, be focused on extracting the greatest possible advantage from the Times brand. The New York Times Co. also publishes the International Herald Tribune.
The U.S. newspaper industry endured one of the worst revenue declines on record in 2007, and 2008 is off to an even worse start. The Times Co. recently reported that advertising revenue in January had fallen 9.8 percent from January 2007. The Times newspaper, a longtime holdout against downsizing, recently announced plans to reduce its news department of 1,332 people by 100 positions.
Lehamn Brothers Holdings, the largest underwriter of mortgage-backed bonds, is eliminating 5 percent of its jobs to cope with the slowing economy, a person briefed on the plan said.

Perhaps the biggest waste of all in Iraq involves not oil but natural gas, an enormous resource that is literally squandered all the time. It comes out of the ground along with oil, and is simply burned off, or "flared," to prevent it from exploding. Yet several studies have concluded that if the gas from the southern oil fields alone were used to generate electricity, it could provide 4,100 megawatts, nearly doubling Iraq's total capacity. Nevertheless, the Oil Ministry has pushed back on every Electricity Ministry proposal over the past five years aimed at capturing and delivering the gas to generating plants.

Exporters begin to curb shipments of natural gas for domestic use
Russia is forcing Exxon Mobil to abandon plans to export natural gas to China. Nigeria is requiring explorers to share output with its citizens. Indonesia will cut sales to Japan.
Countries holding almost half the world's gas are curbing shipments to meet growing domestic use, hurting importers from the United States to Japan.
Prices for the heating fuel may rise 50 percent within five years on the New York Mercantile Exchange as a result, said Chris Jarvis, president of Caprock Risk Management in Hampton Falls, New Hampshire. He anticipated the rally in gas prices during the past month.

Natural gas use is rising 2.5 percent a year, three times the rate for oil, according to statistics compiled by BP. While natural gas provides 22 percent of the world's energy, compared with 23 percent for coal and 40 percent for oil, the world's known gas reserves may last about 63 years, compared with 41 for oil, the BP statistics show.

Some 200,000 to 300,000 Asian laborers - no one knows the exact number - were press-ganged by the Japanese and their surrogates to work on the railway: Tamils, Chinese and Malays from colonial Malaya; Burmese from present-day Myanmar; and Javanese from what is now Indonesia.
"It is almost forgotten history," said Sasidaran Sellappah, a retired plantation manager in Malaysia whose late father was part of a team of 120 Tamil workers from a rubber estate who were forced to work on the railway. Only 47 survived.
Sasidaran, who is helping lead a claim for compensation from the Japanese government, says he has met many families who knew so little about the railway that they failed to understand why their fathers or grandfathers left for Thailand and never returned.
By contrast, the travails of the 61,806 British, Australian, Dutch and American prisoners of war who worked on the railway, about 20 percent of whom died from starvation, disease and execution, have been recorded in at least a dozen memoirs, documented in the official histories of the governments involved and romanticized in the fictionalized "Bridge on the River Kwai," the 1957 Hollywood classic and the best-selling novel by Pierre Boulle that inspired it.

But there is no clear answer as to why there is so little awareness in Southeast Asia about the role of Asian laborers on the railway, especially given the scale of the suffering. In many Malaysian rubber plantations the Japanese demanded that at least one able-bodied son from each family be sent to work on the railway.
Of the more than 85,000 workers who were drafted from Malaya, 33,000 died, according to Japanese records at the time. Yet little is taught about it in Malaysian history books. And there have been no efforts to find and reclaim the countless bodies that remain in the jungles alongside the railway tracks.
Worawut Suwannarit, a history professor at Kanchanaburi Rajabhat University who has spent decades trying to get more recognition for the Asian laborers, has come to a harsh and bitter conclusion.

"This is why these are called undeveloped countries - Third World countries," he said. "They don't care about their people."


SAMSUN, Turkey

The book counted 44 different ethnicities and sects across Turkey, and captured them in pictures dancing, eating, praying, laughing and playing music. If it sounds innocuous, it was not. Turkey, a country that has had four military coups in its 85-year history, has a very specific line on cultural diversity: Anyone who lives in Turkey is a Turk. Period.

Ever since Turkey became a state in 1923, it has been scrubbing its citizens of identities other than Turkish. In some ways, that was necessary as a glue to hold the young country together. European powers were intent on carving up its territory, a patchwork of remains from the collapsed Ottoman Empire, and Muslim Turkishness was a unifying ideology.
But it forced families from different backgrounds, who spoke different languages, such as Armenian, Kurdish, Greek, Georgian, Macedonian, Bosnian, to hide their identities. Family histories, such as the crushing events of Turkey's genocide against Armenians in 1915, were never spoken of, and children grew up not knowing their own past or identity.
"Memories like that were whispered into ears behind closed doors," said Fethiye Cetin, a lawyer who learned only in her 20s that her grandmother was Armenian. "There was a big fear involved in this, so the community itself perpetuated the silence."

The academic, Ayse Gul Altinay, an anthropology professor from Sabanci University in Istanbul, is a kind of national psychiatrist, identifying the most painful points from the country's past and offering a way to think about them that is most direct route to healing.
She uses the Turkish art form, Ebru, the process of paper marbling that produces constantly changing interwoven patterns, as a metaphor for multiculturalism.
"We're not a mosaic, different from one another and fixed in glass," said Altinay, who earned her doctorate from Duke University. "Ebru is done on water. It is impossible to have clear lines or distinct borders."

"The genie is out of the bottle," Altinay said. "Too many people are interested in looking into who we are, who lived on this land before us," for the healing process to be stopped.
A young woman in the audience echoed that thought, as she apologized to Tovmasyan. For as gloomy as the past was, the future was more hopeful, she said, because young people are much more flexible and accepting than the older generations.

"In a few years time, a lot of people will be doing a lot of apologizing," she said.

"It is clear that the EU is committed to Serbia's European future and now Serbia has a crucial chance to move," said Olli Rehn, the EU's Commissioner for Enlargement. "It can either turn to a European future or turn to self-imposed isolation."
Speaking after a meeting of EU foreign ministers, Rehn described the second option as "a road to nowhere."


"It has been established that the government no longer has united and joint policies" over Kosovo and Serbia's EU integration, the government said in a statement Monday. "Aiming to establish the functioning of stable state institutions, we propose the dissolution of the Parliament and the holding of new elections on May 11, 2008," it added.

While calls for Kosovo to join international organizations enjoy the wholehearted support of the United States and many EU member states, they remain stubbornly opposed to Taiwan doing so. Why is this? Presumably, the only reason can be fear of upsetting the all-mighty Chinese.
Thus, while the Taiwanese people live under the constant threat of Chinese military action and international exclusion, on the other side of the world, Kosovars can look forward to a bright, new future.

The scariest thing I've read recently is a speech given last week by Tim Geithner, the president of the Federal Reserve Bank of New York. Geithner came as close as a Fed official can to saying that Americans are in the midst of a financial meltdown.

What's going on? Geithner described a vicious circle in which banks and other market players who took on too much risk are all trying to get out of unsafe investments at the same time, causing "significant collateral damage to market functioning."
A report released last Friday by JPMorgan Chase was even more blunt. It described what's happening as a "systemic margin call," in which the whole financial system is facing demands to come up with cash it doesn't have. (A financial joke making the rounds, via the blog Calculated Risk: "Who is this guy Margin that keeps calling me?")


Advertisements for the 2008 Whitney Biennial promise a show that will tell us "where American art stands today," although we basically already know. A lot of new art stands in the booths of international art fairs, where styles change quickly, and one high-polish item instantly replaces another. The turnover is great for business, but it has made time-lag surveys like the biennial irrelevant as news.
Maybe this is changing with the iffy economy. Several fairs, including Pulse in London, have recently suspended operation. And this year we have a Whitney show that takes lowered expectations - lessness, slowness, ephemerality, failure (in the words of its young curators, Henriette Huldisch and Shamim Momin) - as its theme.
A biennial for a recession-bound time? That's one impression it gives. With more than 80 artists, this is the smallest edition of the show in a while, and it feels that way, sparsely populated, even as it fills three floors and more of the museum and continues at the Park Avenue Armory with an ambitious program of performance art (through March 23).

Since Feb. 15, at least six hedge funds, totaling more than $5.4 billion, have been forced to liquidate or sell holdings because their lenders - staggered by almost $190 billion of asset write-downs and credit losses caused by the collapse of the subprime-mortgage market - raised borrowing rates by as much as 10-fold while making new claims for extra collateral.
While lenders are most unsettled by credit consisting of real estate and consumer debt, bankers are now attempting to raise the rates they charge on Treasury securities, considered the world's safest investments, because of the price fluctuations in the bond market.
"If you have leverage, you're stuffed," said Alex Allen, chief investment officer of Eddington Capital Management in Britain, which has $195 million invested in hedge funds for clients. He likened the crisis to a bank panic turned upside down - with bankers, rather than depositors, concerned they will not get their money back.

Some managers set themselves up for a stumble by taking on too much leverage and not anticipating that terms could change, said Christopher Cruden, chief executive of Insch Capital Management in Lugano, Switzerland. "If you're going to dance with the devil, there comes a time when your toes are going to be stepped on," Cruden said. "Prime brokers are there to do business, not be your friend."

Rob Moore, Paramount’s vice chairman, said there were enough laughs to go around. “You have so much capacity in the summer, and there are only two movies opening that weekend,” he said.
Few here would declare a cultural trend. “Can you make an argument that the world is in such a depressed place that we’re going to comedies?” said Casey Silver, a producer of “Leatherheads.” “Far be it from me to say.”
Still, history has its lessons. Beset by a writers’ strike and a weakening economy, Hollywood saw four comedies — “Who Framed Roger Rabbit,” “Coming to America,” “Big,” and “Crocodile Dundee II” — sweep the box office in the summer of 1988. In the last three presidential campaign years, however, the biggest comedy hit came after the election: “Meet the Fockers” in 2004, “How the Grinch Stole Christmas” in 2000 and “Jerry Maguire” in 1996.

A new wave of credit fears swamped Wall Street on Monday, pushing stocks to 17-month lows and bond prices sharply higher, as skittish investors reacted to rumors and news of firms exposed to the mortgage crisis.
Traders speculated that Bear Stearns could be on the brink of bankruptcy. The Bear Stearns chairman, Alan Greenberg, called speculation about the company "totally ridiculous," but investors remained jittery amid a growing list of troubles for financial markets.


Muhammad, a hamburger vendor whose stand is about 175 feet from the site of the bombing, said the same group of eight or nine American soldiers had been coming to the street for the last three days, getting out of their Humvees and walking around the shopping area, called the Rawad intersection after a popular ice cream parlor there.
"Usually, we see the Americans come in Humvees and they don't stop, they just keep driving," said Muhammad, who was afraid to give his last name. On Monday, he said, a soldier carrying a notebook walked into a currency exchange called The Ship. The other soldiers gathered in a small group.
"When the explosion happened we panicked and started running, and the gunner on one of the Humvees started shooting," he said. "Even the Iraqi soldiers and police started firing in the air, so we jumped into one of the narrow alleys and remained there hiding until the Iraqi soldiers ordered us to walk at least two blocks away from the spot."
He said that before the bombing, he had been surprised that the soldiers had allowed pedestrians to come up and talk to them, instead of keeping them at a distance as they normally do.


In dealing with the emerging Pakistani leadership, American policy should focus on national security objectives (control of nuclear weapons, counter-terrorism cooperation and resistance to Islamist radicalism).
Our democratic principles should be clearly conveyed, but we should have learned by now that the evolution of the immediate political process is beyond our reach.

We do not have the choice between national security and democratic evolution. Both are important objectives but may be achievable only on different time scales.

Many soldiers on the 12-month unaccompanied Korea tour of duty have only recently returned from 15-month combat tours in Iraq or Afghanistan, making the Korean deployment that much more difficult for them and their families.

Bell told of speaking with a young captain, the father of a 2 ½-year-old girl, who arrived alone in South Korea just five months after returning from more than a year in Iraq. The captain had spent less than eight months with his child in her life.
"You know, we can do better than that," Bell [General B. B. Bell, the commander of American forces in South Korea] said he told the captain.


A Dutch appeals court on Monday overturned the conviction of a lumber trader who had been found guilty of breaking a United Nations embargo and smuggling weapons for Charles Taylor, the former president of Liberia, during that country's civil war.
Guus Kouwenhoven, 65, a Dutch trader and a business partner of Taylor, had been sentenced in 2006 to eight years in prison for selling Liberian lumber on the world market and bringing back weapons and ammunition aboard his company's ships between 2001 and 2003.
But the Dutch appeals court in The Hague said the evidence against him was frequently "contradictory" and not sufficiently credible. Depositions taken from witnesses in Liberia had been unclear and unreliable, it said, adding that a conviction based on such evidence would be "built on quicksand."


Web companies track users' Internet activity hundreds of times per month
A cartoon in the New Yorker magazine from 1993 showed two dogs at a computer, with one saying to the other, "On the Internet, nobody knows you're a dog."
That may no longer be true.

The new analysis indicates that Web companies are, in effect, taking the trail of crumbs people leave behind as they move around the Internet, and then analyzing them to anticipate people's next steps.
So anybody who searches for information on disparate topics like iron supplements, airlines, hotels and soft drinks may soon see ads for those products and services.

"When you start to get into the details, it's scarier than you might suspect," said Marc Rotenberg, executive director of the Electronic Privacy Information Center, a privacy rights group. "We're recording preferences, hopes, worries and fears."

On some airlines, business class goes first
"Flying is valuable office time to me,” said Andrew M. Sacks, 40, president of AgencySacks, an advertising group in Manhattan. “If I get the space I need to work and a good seat, I justify the expense by getting a week’s worth of work done on an eight-hour flight.”
Even so, he said he could not rationalize spending close to $13,000 for a pair of Continental’s BusinessFirst seats for himself and Julie Fisher, a vice president at the agency, to fly to Barcelona in November 2006 for a Leading Hotels of the World convention.
Instead, they bought three coach tickets at $500 each, left the middle seat empty and brought their own veritable smorgasbord from Balducci's Market, a gourmet grocery store in Manhattan, that was, he said, "as savory as anything they were serving up front."


China plans to set up a company by the end of this month to develop and make a 150-seat airline, said Gao Daling, company secretary at China Aviation Industry Corp II.

When did character morph into celebrity, making the fame game the focus of magazine photography?

Shares of McDonalds, the biggest hamburger chain in the world, were up 2.6 percent late Monday after the company reported February sales that exceeded most anlysts' estimates on increased demand in China and Europe.

DAKAR, Senegal
Centuries before European colonialists carved up Africa, Arab traders marvelled at the profits to be reaped in the fabled lands south of the Sahara.
"In the country of Ghana, gold grows in the ground as carrots do and is plucked at sunrise," wrote Ibn al-Faqih, a ninth-century scholar.
Arab investors, flush with revenue from record oil prices, once again see golden opportunities in sub-Saharan Africa. From waterfront resorts in Cape Town to phone networks in Congo, they are pouring in billions of dollars.
"The opportunities which you see in Africa, you don't see them anywhere else in the world," Sultan Ahmed bin Sulayem, head of Dubai World, said after signing an $800 million deal this year for a free-trade zone in Senegal.

The West has worried as Chinese and Indian companies seal multibillion trade deals. Now Arab rivals are joining them.

SANTA CLARA, California
On a recent Saturday, John Toppel, a retired Hewlett-Packard sales manager, did not spend his leisure time golfing or mowing the lawn. He spent it at a local electronics store extolling the virtues of HP laptop computers to customers.
He was not paid by the store or by Hewlett-Packard, for that matter. Toppel, 62, left the technology company four years ago, but he remains a volunteer cheerleader for Hewlett-Packard, one of thousands of its retirees whom the company is trying to galvanize into an auxiliary army of senior marketers, good-will ambassadors and volunteer sales people. None of them get paid. They do it, they say, because of their affection for the company.
"I feel like I have two marriages: a wonderful marriage at home for 36 years and a wonderful marriage at HP," Toppel said. "I guess that's now a former marriage, but I still have strong feelings for it."
Across the United States, companies are making use of retirees as part-time or temporary workers. They are taking advantage of not only their expertise, but also their desire to stay involved and engaged with the world through work.

"We're moving forward with an effort to capitalize on the fact we have these great brand stewards," said Michael Mendenhall, chief marketing office of Hewlett-Packard. "When you look at the importance of great word of mouth and great third-party endorsement - who better to do that than your own employees?"

HP said participation was the reward. "It's about being part of the HP community and its rich heritage," Mendenhall said. "That's what they get."

Chile is undertaking its biggest overhaul ever of its pioneering private pension system, adding sweeping public payouts for the low-income elderly.
The new $2 billion-a-year program will expand public pensions to groups left out by private pensions - the poor and self-employed, homewives, street vendors and farmers who saved little for retirement - granting about a quarter of the nation's work force public pensions by 2012.
The program, to be signed into law Tuesday, is the most ambitious pension plan for the poor in the region, according to David Titelman, a social security expert at the United Nations Economic Commission for Latin America and the Caribbean.
The so-called Solidarity Pensions of President Michelle Bachelet will supplement, not scrap, the current private pensions, while salaried employees continue paying in to private funds in a combination of state subsidy and free market.

In July, nearly 600,000 poor Chilean seniors will start receiving $125 a month, followed by $158 a month next year - well above the country's monthly urban poverty line of $95. Nearly two-thirds of elderly urban poor will benefit from the payout by 2012.
Giovanni Carmona, an executive at the Hogar de Cristo, a Catholic shelter for 5,000 elderly Chileans, calls the legislation a "historic step" for elderly citizens. "This opens not only new hope, but also better living conditions for them," he said.
The overhaul could also cut state health care costs by giving the elderly more cash to care for themselves, while new subsidies encourage young people to contribute more to private accounts.
"After 25 years, Chileans have decided to mend it, not end it," Patricio Navia, a professor of political science at Diego Portales University in Santiago and an adjunct professor at New York University, said in an e-mail message. "The reforms will end up legitimizing the system, not weakening it."


No comments: