José Piñera

José Piñera Echenique ( born October 6, 1948 in Santiago de Chile) is a Chilean politician and economist.

Life

Piñera attended the Universidad Católica de Chile and received in 1974 a professorship at Harvard University. Between 1978 and 1980 he was a Chilean Minister of Labour and 1980-1981 Minister of Mines under the Chilean dictator Augusto Pinochet. As Minister of Labour in Chile, he led fundamental structural reforms: he replaced the state pension system by a privately organized and funded system based on private pension funds. He also built from workers' rights and privatized the mining sector. In 1981, he resigned as minister of mines.

Piñera, one of the so-called Chicago Boys, founded in 1982 to spread his liberal economic ideas the journal " Economia y Sociedad ".

It is generally believed that he initiated pension reform would be met with much stronger opposition because of their radicalism in a democratic state. This was also reflected in later pension reforms in other Latin American countries; as governments, almost all were democratic at this time, the Chilean model has been rarely applied in pure form, but aimed mostly compromise solutions such as parallel and mixed models. Argentina about a combined public pension system with defined-benefit with the Chilean model of pension funds.

After the transition in Chile Piñera founded the project "Agenda Chile 2010". In 1992 he won the mayoral elections in Conchalí, a poor neighborhood of Santiago de Chile. His candidacy for the Chilean presidential election in 1993 failed.

Piñera is now director and founder of the Institute itself " International Center for Pension Reform", whose goal is to migrate all public pension systems in the world to a world capital orientation. He is also since 1995 working for the Cato Institute, one of the most powerful liberal economic think tanks. Piñera even advises several governments on issues of conversion of national pension systems on equity-based systems, especially in Eastern Europe. His pension policy recommendations, however, met repeatedly criticized by economists. Also, because of his association with the Pinochet regime José Piñera is controversial.

His brother Sebastian Pinera is a leading politician of the right-wing Renovación Nacional and since January 2010 the Chilean president.

The privatization of the Chilean pension system

The privatization of the pension is not justified Piñera initially with higher potential returns. Rather, he criticized the existing state pension as an instrument of power, by which the citizens would be forced into dependence on the state. He claimed that the customers of the private pension funds would acquire contractually enforceable property rights during a state pension can only offer abstract commitments. The main difference between the two retirement method consists in so Piñera that when the levy no pension reserves are formed, so there is no tangible capital goods, on which a person can have property rights. Therefore, the amount of the pension, according Piñera must always be available to mass political despotism. Critics argue that the funding method used private pension funds are exposed to significant capital market risks. But at least the rudiments of the contributors are protected from a possible bankruptcy of private insurance companies, since in this case the savings asset is transferred to another pension savings company. The saving power of the workers is not affected by the bankruptcy of a company retirement savings, since the latter the assets are managed, but it does not borrow or can access it.

More put forward for Piñera's pension privatization arguments had hoped wirtschaftsbelebende effects and the creation of an incentive to change the widespread contribution evasion. Whether these goals were achieved, is controversial. A study by the Chilean Central Bank, conducted by Klaus Schmidt- Hebbel and Vittorio Corbo, concludes that the reform have generated new investment capital, increase the participation in the formal sector of the labor market, and promote the productivity of the economy. Others, however, come to the conclusion that the reform is fraught with considerable problems. The leading World Bank economist and Nobel Prize winner Joseph E. Stiglitz published in 2001 together with Peter R. Orszag an essay in which practiced both sharp criticism of pension reforms of the Chilean type. Subsequent empirical studies about by the internationally renowned economist Carmelo Mesa -Lago confirmed in many ways, the criticism of Orszag and Stiglitz. So, for example, was in 2000 the number of active contributors in Chile just 60 percent, although the reform was introduced with the explicit goal of significantly reducing the widespread contribution evasion in Chile.

Honors

• " John S. Bickley Gold Medal" (1999), International Insurance Society
• "Hall of Fame " (2000), International Insurance Society
• "Champion of Liberty " (2003), Goldwater Institute ( libertarian think tank )
• " Liberty Award" (2005), Liberalni Institute, Prague
• " Golden Umbrella Award" (2007), Stockholm Network ( network of think tanks )
• APEEs " Adam Smith Award" (2009), Association of Private Enterprise Education