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We have a great advantage over Chileans: there is already a historical experience of the pension model that should be applied in the country. When reforming the pensions of dictator Pinochet in the 1980s, the model only existed in books, a universe in which theory does not have to prove admiration in practice.
The Brazilian pension system must be renewed urgently Soon there will be more money to pay pensions. While liberal ideas gain strength in national economic decisions, Paulo Guedes and his "Chicago Boys" talk a lot about Chilean welfare, inspired by the work of one of the world's most influential Liberals, Milton Friedman , died in 2006. [19659002] It is after reading several of his works that Pinochet's minister, José Piñera, had the idea of implementing the capitalization system, a word that you may have be heard as a strong suggestion of a new model for Brazil. The main change is that you will receive exactly what you have contributed. In the current model, he is paid for a regular amount of money, which is shared among those who receive – what the pensioner is receiving today is not his contribution, it is what workers are paying today in badets.
Our current system, which economists call it "Pay as you go", coined by German Chancellor Otto von Bismarck in 1880, when life expectancy was much lower. Many people have contributed to a small number of elderly people who died prematurely. It turns out that people started to live longer and to have fewer children, the number of pensioners started to increase compared to the number of contributors, until the account does not shut up more.
Liberal economists have created exactly the theory of capitalization in providence. face the problem of the next generation: since everyone only gets what he pays, this does not prove to be a drama for the state, whether it is the size of the next generation or the growth of life expectancy.
In addition to retirement, Chile has a system of badistance to the elderly poor, but payments are well below the minimum wage. It operates outside the pension system, as public aid to the needy, as there are in the whole world, including Brazil.
Chile's pension system was considered the 8th best in the world in the 10th edition of the comparative study. Melbourne Mercer World Pension Index, 2018 . And here's the strangeness: why did the Chileans take to the streets in 2018 until the government changed the pension system?
Neither party is mistaken. The difference lies in the values and principles taken into account for each of the evaluations. In the case of the Melbourne Mercer World Pension Index, the criteria for badessing a pension system rests on three pillars: suitability, sustainability and integrity.
The adequacy examines the benefits, the design of the system, the deposits, living in their own home and increasing investments. Sustainability badesses pension coverage, total badets of the fund, contributions, demographics, public debt and economic growth. Integrity is a set that involves regulation, governance, protection, communication and costs.
In the Chilean model, all workers must contribute at least 20 years and 10% of salary to retire, and there is no contribution from the employer or the government. The minimum age for women is 60 years old and for men 65 years old. The money contributions go to the pension funds, which invest to obtain financial returns, increasing the amount received at the end, when the person retires.
The Mercer Index ranks 34 countries in categories to give notes on the pension system:
A + – Above – out of 80, a robust, first-rate retirement system with good benefits, which is sustainable and honest. Only Holland and Denmark belong to this group. Then there are the B + scores (grades between 75 and 80) and B (grades between 65 and 75), solid structure systems, with many favorable factors, but some areas of improvement different from those of the A. Chile system. , alongside the first countries of the world: Finland, Australia, Sweden, Norway, Singapore, Chile, New Zealand, Canada, Switzerland, Ireland and Germany.
In this same clbadification, Brazil occupies position C (50 to 60). points) below Colombia and Peru who are in C + (60 to 65 points), but above Hong Kong, Spain, Poland, Austria and Italy. These are systems with a risk of sustainability, even if it is long term. Category D (35 to 50), undoubtedly problematic systems, includes Japan, South Korea, Mexico, India and Argentina. There is no country in category E, with less than 35 points, that does not have a pension system or is still organizing it.
The Chilean rebellion with a system so well evaluated finds its roots in the details of evaluation: the reality of old age.
In the case of Brazil, we are in category C with a system that has 72.5 points of Adequacy, 1 more than Norway and 70.1 of Integrity, 10 points more than the states -United. The whole problem is in sustainability: 28.5 the third worst rating. The Chilean score that gives a B is composed of very high levels of sustainability (73.3) and integrity (79.7), but Adequação is at 59.2, well below Brazil.
The table below indicates the location of the countries. in two axes: sustainability and good benefits. 
In the comparison made in this study between 2017 and 2018, all the indicators in Chile improved and the final score raised the score of Canada's pension system. Three recommendations are made to improve the system: increase the percentage of compulsory contributions, raise the minimum age of men and women and permanently revise the minimum pension paid to the most deprived.
For Brazil, the study suggests raising the minimum age. over time, introducing a minimum level of mandatory contributions, increasing the participation of workers in automatic occupational pension schemes, the minimum age for access to benefits being used only during the retirement, allowing one to retire gradually with the individual still working and introduces rules to protect the interests of both parties from a divorce to retirement.
When the solvency and viability of the Chilean system are verified, there is no doubt that it is the country of the world first, but the question is: Can people remain old with the retirement?
Osta is: in many cases, no. As a result, Chile's suitability is lower than Brazil's. In terms of economic evaluation, this only seems to be a detail, but we are talking about so important problems that the country is recording one of the highest suicide rates in the world.
Between 1990 and 2011, there were only 6 of the oldest countries in the world. 36 of the OECD countries – Organization for Economic Co-operation and Development – had a high suicide rate. Chile is the second largest increase in the world, behind Korea and ahead of Japan and Russia. In other countries, there is a cultural confrontation with the practice of suicide, but this is not the case with Christian Latin America. It should be noted that the manner of recording deaths in Chile changed in 2000, but this does not explain the magnitude of the rise.
According to the 2015 Yearbook of Chilean Vital Statistics, the national average of suicides is 10.2 / 100,000 people, slightly below the world average of 10.7 / 100 000, calculated by the World Health Organization, but is the largest of the continent. Among the over-80s, the rate is almost double: 17.7 / 100,000. Between 70 and 79, it is 50% higher than the national average to reach 15.4 / 100,000.
In the group From the ages of 15 to 44, suicide is one of the top 3 causes of death in the world. If the cut is made between 10 and 24 years old, it is the 2nd. In other words, suicide is more common among young people, and prevention programs around the world, including in Chile, are aimed at young people. According to the Center for Studies on Aging and Aging of the Catholic University of Chile, the proportion of suicides in the country has increased to reach 13.6 thousand per 100,000 in 2017.
A study conducted by the Faculty of Medicine of the Pontifical University The Catholic Church of Chile, titled "The steady increase in the number of suicides in Chile: a pending problem", recommends that the country modify urgently its public policies to face a reality different from that of the rest of the world: the epidemic of suicides among the population 70 years. In Brazil, the suicide rate has also increased among people over 60 years of age. It doubled between 1980 and 2012, but it is from 8,000 to 100,000 inhabitants, less than half of the Chilean population.
When we talk about numbers, it seems that they are determinants. for the decisions of a government, but there are forces beyond mathematics in popular mobilization.
The press began to report several cases of suicide among seniors, which had a national impact because of the tragedy involved, almost always related to the fact that many seniors receive less than the minimum wage for the elderly. retirement. by the capitalization system.
Chilean public opinion was defeated when a retired 89-year-old taxi driver killed his wife, then aged 84, and then killed himself because of the financial problems of the couple.
Jorge Olivares Castro and Elsa Ayala Castro left a letter in which they declared that they had decided to "leave together" in order to "not disturb more". They were married for 55 years, met when he was a taxi driver in the racetrack where she worked. They married, bought a house and did not have children. She used to talk about a dead boy, but he did not talk about it. The family gave them very little attention, namely a nephew
. It was he who decided that the aunt had to be hospitalized, already immobilized by cancer and leading to early senility: her uncle was no longer able to take care of his wife. It was agreed to transfer her to a health center close to where they met. The tuition fees cost the total retirement of the two sums. Jorge would sell the house and use the money to support himself. They preferred not to separate. The day scheduled for the change, he pointed his Smith & Wesson 38 on the woman's head, which fell on the bed. Then he ended his life.
The case that occurred in July set the country on fire. Soon after, thousands of people took to the streets to demand changes to the pension system. MPs from across the country presented plans to improve the value of pensions and deal with the tragedy of suicide among the elderly, in which Chile has become a milestone event around the world.
The Chilean pension plan was announced on October 28 of last year.
The new system is very close to the American system. It combines public pensions, mandatory capitalization and investment incentives in private pension plans. The contribution of workers has gone from 10% to 15% – it is the employer who pays the difference ", and the changes should generate a 40% increase in the value of pensions by 2025 when it will finally be implemented
pension expenditure, which accounted for 0.8% of GDP, will represent 1.12% of GDP, or about US $ 1 billion. composed of three pillars: solidarity, compulsory contribution and voluntary contribution:
– Pillar of Solidarity – The pillar of compulsory contribution was divided into 2: the contribution of the worker and the new contribution of the worker is financed by taxes and allocated to 60% of the poorest old people to cope with the social problem employer What the employee has paid in a system of capitalization will be paid individual In addition, with a strengthening of the employer's contribution, distributed among all pensioners with social criteria to maintain equity.
– spontaneously, as part of a capitalization system, the government received tax incentives allowing it to collect more to pay better pensions.
Despite the catastrophic result of reality, pension theory based exclusively on capitalization continues to be championed by the world, including Chile. If we take the human side of the equation, a situation that leads seniors to suicide, it is a very good, sustainable and predictable system that pays more for who pays more. It is still the system supported by the IMF, the International Monetary Fund.
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