Argentina: a closer step towards nationalising private funds

BUENOS AIRES, (AFP) - Argentina's lower house early Friday approved a law nationalizing private pension funds, allowing government to take over some 26 billion dollars in retiree fund assets. After a marathon 14-hour session, deputies voted 160 to 75 in favor of the bill, which has been a flashpoint of controversy since President Cristina Kirchner last month suddenly announced her intent to nationalize the funds in order to protect retirees from effects of the global financial crisis.  The bill now moves to the Senate, where Kirchner's Peronist party has a slimmer majority than in the lower house. "There was a (private) system that spectacularly collapsed. This was a policy of looting," Kirchner said earlier to justify the nationalization. "It is evident that when nobody regulates the market, nobody controls it and it is allowed to do what it wants, we wind up with a financial disaster like the one the global economy faces," she said. Opponents believe the move is a confiscation of funds that would be used to pay the country's public debt. Argentina in 2009 faces debt payments of some 20 billion dollars. The reform continues a policy of strengthening the state's role in the economy which began under the previous president, Nestor Kirchner, the current president's husband. During Nestor Kirchner's 2003-2007 presidency the postal service, the water works company and rail lines among other things were nationalized.