Infoveloz - We are listening to many proposals that want to revive the economy "putting money in people's pocket". Now, if the country has no credit or savings, where will that money come from?
Easy, goods will be taken from someone to be distributed later; but no candidate is going to tell who are those "someone" because it could lose potential votes. In addition, by doing this the country will stop growing, because surely the sector that produces those goods, will stop spending or investing that amount that is lost towards those who receive it and will spend. So, it does not increase the total demand of the country. On the contrary, given that, among 190 countries, Argentina is in 21st place among the highest taxation towards their companies, increasing the tax pressure we will lead to much less investment and, therefore, less employment and welfare in the future.
Also, they could give "the little machine" to put money in people's pockets. The trouble is that it would mean trying to put out the fire of "rising inflation" by increasing the fuel; what with the current sharp fall in the demand for pesos could even lead to hyperinflation. However, even if the latter did not happen, it is known that the inflationary tax punishes those who have less; so it is rather a redistribution to the "Hood Robin" instead of "Robin Hood".
So what is the way out? Let's look at a simple example. Suppose I am the butcher of my neighborhood. A responsible guy who wakes up early to control the good quality of the meat they bring me. I open my business on schedule and attend very well to my clientele; So I earn your trust and good money. But one day I start to get up later and, many times, my lazy assistant receives the meat; So nobody controls its quality. I do not always open on time and sometimes I close to go for coffee with my friends. Surely, I will end up losing my clientele because they will stop trusting my butcher shop; so I will earn less and be poorer.
Imagine a friend comes and proposes that, to get ahead, I need to put more money in my family's pocket? Without clients, I have no money or credit. The solution is to ask myself why I came to that situation and begin to regain the trust of my clients. Getting up early, controlling the meat I buy, opening when appropriate and complying with the opening hours. Surely, customers will start to come back and recommend my business again, so I can improve my standard of living.
If we put aside the magic solutions, we should ask ourselves why we are here. And the answer is: for not solving the structural problems of Argentina. For several decades we have lived from crisis to crisis; in which the disastrous results of not facing the pending structural reforms are liquefied. It is what happened in 2002 that implied a phenomenal social cost, with more than 57% of Argentines in poverty. After the debacle, the economy always recovers again and, as in the past, at the later stage of growth not only was it not taken advantage of to address the necessary solutions, but the problems that nobody had solved before were aggravated. Thus, we reached the edge of the precipice in 2015 and continued to wobble there; because the current management was not encouraged to make all the changes demanded by the delicate state of the country.
Therefore, in 2018, in the face of the smallest international tremor, Argentines and foreigners lost confidence and began to take their savings out of Argentina. That involved fleeing the peso and moving to dollars massively, creating a currency crisis. The loss of credibility was such that it left us without enough credit to face our public debt and we did not enter into cessation of payments thanks to the agreement with the IMF; without which we would have had one of the traditional crises, although with the current fall in welfare, impossible to avoid.
How is it solved? As the butcher did, we must recover the trust of the "customers" to bring back their savings and invest in Argentina. For this, on December 11, we must solve the country's deep problems. To face a great reform of the State, that serves the Argentineans and not the politics (as it happens today); but, in addition, so that we can pay it. At present, it is not enough to squeeze workers and entrepreneurs. If we want an economy that gives everyone more opportunities for progress, it is necessary to lower the tax pressure. Also, change the current labor legislation that is incapable of generating productive employment in the 21st century. If we take any year of the last 20, more than 40% of people were unemployed, in informality or with unemployment insurance disguised in a public sector position or a welfare plan. Finally, quickly disarm a network of regulations that drowns, above all, both entrepreneurs and SMEs and whose only aim was to justify the excess of public employment and the eagerness of the enlightened bureaucrats to use their power to decide for their fellow citizens.
True, the ease of magic solutions is attractive; But it only leads to new failures. As mature citizens, we must demand the President-elect to face the hard way of solving the problems that prevent us from growing. The experience of other countries that did it shows that the prize is enormous, not only to avoid a crisis worse than that of 2002, but to be able to triple the purchasing power of all Argentines for three or more in the next 20 years, as happened in them.
By Aldo Abram
(Xinhua) - Argentina's president, Mauricio Macri, will conclude his term in 35 days with "contradictions that prevented the implementation of a series of economic reforms" that, if they had prospered, would have helped "solve problems such as high inflation, poverty and unemployment” said expert Natalia Motyl today.
Motyl, an analyst with Fundación Libertad y Progreso (FLyP), said in an interview with Xinhua that “Macri's management was plagued by political contradictions and limitations. On the one hand, his speech always pointed to the right path. However, the economic policies carried out were quite timid and slow for the seriousness of the country's problems.
«Macri applied, endorsed in part by the International Monetary Fund (IMF), a gradualist policy, which gave him a certain air in the social peace. After a series of riots in December 2017, his Government definitely cowered with the reforms that had to be carried out and chose a scarce path of pragmatism. He bought time by borrowing from the IMF” said the economist.
The economy of Argentina, the third in Latin America, will close this year with a contraction of 3.1%, according to the IMF. The country also records with high inflation of 37.7% in the first nine months of the year, an unemployment rate of 10.6% and a poverty rate that affects 35.4% of the population.
«Argentina has a persistent high public expenditure, which exceeds its income and causes distortions in the rest of the economic variables. Because the State chooses to finance it, instead of reducing it, are the causes that produce high rates of unemployment, inflation and poverty, in addition to a stunted productive structure, which cannot cope with external shocks and economic stagnation since 10 years ago” Motyl observed.
The analyst stressed that "there are no magic recipes, but successful policies" to address the country's economic problems: "If we want to grow, then we must cut public spending."
«Macri, on the other hand, decided to finance this public expenditure by borrowing, so as not to generate social tension. He definitely bought time, but it wasn't enough. It was seen that the gradualist policy of his administration was not consistent with the fiscal deficit when trying to control inflation with ‘inflation targeting’ and they definitely got out of hand” the interviewee analyzed.
Argentina last year signed an agreement with the IMF to access a loan for 56.3 billion dollars, of which it received about 44.1 billion. A disbursement of $5.4 billion is pending due to the political and financial situation in the country after the Macri setback in the general elections of October 27.
According to the Government, Argentina faces a level of indebtedness equivalent to 68% of its Gross Domestic Product (GDP), a figure questioned by the opposition, which ensures that the debt represents the entire national GDP.
The expert stressed that “if the Government had applied a shock policy, the story would have been different. A shock policy allows to quickly eliminate distortions and thus improve efficiency, increasing the well-being of the whole society. If Macri had chosen that path, today poverty would be reduced, there would be single-digit inflation and a manageable unemployment rate. Unfortunately, it was not possible to do it».
Asked about the points to be distinguished from the administration that concludes on December 10, Motyl considered that "Macri's management has three fundamental points to highlight: institutional quality, international relations, greater transparency."
«In 2019, Argentina rose in seven positions in the Institutional Quality Index. And from 2017 to 2019, the country went from position 142 to 112. In the Corruption Perception Index, prepared by the International Transparency Organization, our country also improved, currently positioning itself in position 85 of 180 countries,” she emphasized.
She also said that «there is no doubt on the improvement in relations with the rest of the world. Argentina managed to strengthen bilateral relations. Returning to the markets was not a simple task and Macri made a breakthrough in this area».
On the other hand, the current Government “was pending to reduce current expenditure completely, beyond achieving a primary result close to zero due to the rise in taxes, and thus return to the path of growth with low inflation and the rate of unemployment. These are the great challenges that our country has and we must face them urgently” urged the economist.
According to a government document released on Tuesday, «in 2019 the Argentine State will practically reach the primary balance, both nationally and provincially. This is something that has not been seen for a decade and that is practically an exception in the economic history of the last 70 years.
The imbalance of public accounts has been in the last decades one of the main factors of the volatility of the Argentine economy: in the last 60 years the consolidated Argentine Public Sector had, on average, a primary fiscal deficit of 2% of GDP, with maximums of 12% and an average fiscal deficit of 4% of GDP, according to that document.
«The fiscal effort (of the past four years) was achieved by preserving social investment, returning resources to the provinces and reducing tax pressure. Thus, in 2015-2019, primary spending excluding social benefits, had a reduction of 5.1 points of GDP, returning to 2006 levels, ”said the Government document.
Motyl said that the next administration, which will be in charge of the Peronist leader Alberto Fernández, “will find Argentina on the verge of suffering one of its greatest economic crises in history, with the same problems as when Macri assumed, but in this case totally indebted ».
«Clearly, Argentina does not have much room to choose a different path to pragmatism. Today the priority is to get out as airy as possible from the crisis” she summarized.
For Motyl, Argentina will recover the path of economic growth if “a labor reform, a tax reform that includes the reform of federal tax co-participation, commercial opening, an educational reform and achieving a healthy currency prosper. Each one of them are necessary and essential to be able to get out of this stagnation in which we are for a decade.
By Natalia Motyl
Gracias al modelo de libre mercado adoptado por Alberdi la industria argentina se desarrolló rápidamente, convirtiéndose en la más grande de Latinoamérica y llegando a exportar al mundo el 20% de su producción. No te pierdas nuestro nuevo video:
https://www.youtube.com/watch?v=-_V7G-k3RDk
EL LITORAL - El director de la Fundación Libertad y Progreso, Manuel Solanet, y el analista internacional, Jorge Castro, galardonaron el exitoso encuentro del Club de la Libertad, que reunió a prestigiosos consultores y economistas durante dos días.
Un cierre de lujo tuvo el 6° Congreso de Economía Regional de la Fundación Club de la Libertad. El director de la Fundación Libertad y Progreso, Manuel Solanet, y el analista internacional, Jorge Castro, fueron el broche de oro de dos jornadas en las que se expuso sobre “Las reformas estructurales”, que debe encarar el país.
En ese marco, ambos visitaron, junto con Ricardo “Caito” Leconte, el diario El Litoral para dialogar con el director propietario de este medio, Carlos Alberto Romero Feris.
Sobre qué esperar de los primeros 100 días del gobierno de Alberto Fernández, Solanet fue contundente: “No tengo una respuesta porque se presentan alternativas que dependen del predominio de una u otra tendencia dentro de la coalición que ha ganado las elecciones”.
“Por ahora parece que Alberto Fernández se orienta a una posición más pragmática y eso sería un dato positivo”, destacó.
Pero advirtió: “Por otro lado, la corriente que responde a Cristina Kirchner y a La Cámpora, sobre todo a (Axel) Kicillof, tiene una posición más ideologizada y poco consistente con las medidas que hay que tomar para superar una situación extremadamente difícil en lo fiscal y consecuentemente muy comprometida en la estabilidad de precios y en el equilibrio y pago de la deuda”.
“Creo que si algo define el futuro es que no hay alternativas. Argentina ha utilizado a pleno el crédito del sector privado y de los organismos internacionales, y en este momento no está en condiciones de ampliar su endeudamiento. El déficit primario y el pago de los servicios de la deuda llegan a 5 puntos del PBI, y la deuda empieza a tener vencimientos”.
“De manera que hay generar una situación fiscal diferente y esto tiene que ser resuelto por el lado de la reducción del gasto público, ya que la presión impositiva tampoco da para más. Hay ideas sobre aumento de impuestos, pero esto es como una naranja a la cual se le ha quitado todo el jugo, uno puede seguir apretando y no sale nada más”, explicó.
“El único camino es duro de recorrer, porque es reducir el gasto burocrático, la reducción de los planes sociales, de los subsidios, lo que implica aumentar las tarifas, sobre todo la de energía y el transporte”.
“Esto parece difícil sobre todo para quien hizo campaña para ganar las elecciones basándose en el supuesto perjuicio que hubo para la gente en estas medidas que Macri tomó tímidamente y en forma gradual”, agregó.
Insistió en que “la realidad lleva al Gobierno al único camino que puede recorrer y si lo hace, va a tener apoyo internacional. Pero ese camino parece no ser el que políticamente ha defendido ante quienes le dieron el voto el 27 de octubre”.
Jorge Castro, en tanto, alertó que “el país tiene que pagar 29.000 millones de dólares de deuda externa en 2020, y no los tiene”.
“Debe refinanciar esas obligaciones y en caso de no hacerlo, obligaría a un ajuste en más de 6 puntos del PBI, que es superior al ajuste que ha realizado Macri desde 2018”, reveló.
“No hay alternativa a la refinanciación, pero para acordar con los acreedores privados de Wall Street, primero hay que hacerlo con el Fondo Monetario y no habrá acuerdo con el FMI sin el aval y respaldo del presidente de los Estados Unidos, Donald Trump”, detalló.
“La principal línea de acción del próximo gobierno es un acuerdo con Trump”, reiteró.
“Este es un mundo de realidades”, dijo Castro para graficar: “El presidente Donald Trump fija su posición de gobierno respecto a los distintos países de América del Sur según la posición que tomen respecto al régimen de Nicolás Maduro en Venezuela. No hay acuerdo con el presidente Donald Trump sin una actitud inequívoca de rechazo y aislamiento a Maduro”, concluyó.
El economista Manuel Solanet dialogó con Sudamericana al respecto de los dichos del presidente electo desde México, principalmente respecto de la economía. “Dijo algunas cosas que permiten que no ocurra nada hasta diciembre”, recordó, agregando sus impresiones sobre que la relación con el Gobierno azteca “es un puente para acercarse a Venezuela”.
Solanet recalcó que hasta el momento, Fernández “no tiene un programa establecido, dijo algunas cosas que le permiten que no ocurra nada hasta diciembre”. Habló del cepo a la comercialización de dólares, ratificando que “no es una buena medida pero si no se implantaba, las reservas no llegaban a diciembre”, adelantando que el Presidente electo “va a tener declaraciones muy cautas, no arriesgará medidas”.
Reclamó la necesidad de “corregir el desaliento de la inversión por los regímenes legales impositivos y laborales”, agregando que “hay expectativas de cómo resolver y si no hay medidas estructurales, seguiremos con inflación y desequilibrio fiscal”. “Hay que darle chance de que haga un diagnostico profundo”, manifestó y expuso que “la formación de un Consejo Económico y Social se ha experimentado, es un paliativo, pero es un muy difícil intentar un régimen corporativo en un país que no lo eligió, así que no es una medida económica de fondo”.
Respecto de los dichos sobre pesificación de tarifas, Solanet expuso que “hay un problema con la energía” en nuestro país y que “Vaca Muerta es esencial para el futuro pero debe adaptarse a los precios internacionales porque de otra manera no van a invertir y pesificar en esta área de entrada va a significar que no lleguen inversiones”.
En relación a la relación con Brasil y los dichos del presidente carioca, reclamó que “hay que resolverlo porque no podemos estar enemistados”. Recordó que “Bolsonaro tiene que meditar lo que dice porque no es bueno que suceda esta disputa, así como la actitud de Fernández de pedir la libertad de Lula, que en Brasil se considera que está preso por corrupción”.
Respecto de la relación con México y las posibilidades que ofrece el país azteca, Solanet advirtió que “si es un puente para tomar una posición para retomar relaciones con Maduro no es interesante”. Deslizó que “la vicepresidenta electa lo está presionando para retomar una relación con Venezuela y el está en medio”.
Infoveloz - We are listening to many proposals that want to revive the economy "putting money in people's pocket". Now, if the country has no credit or savings, where will that money come from?
Easy, goods will be taken from someone to be distributed later; but no candidate is going to tell who are those "someone" because it could lose potential votes. In addition, by doing this the country will stop growing, because surely the sector that produces those goods, will stop spending or investing that amount that is lost towards those who receive it and will spend. So, it does not increase the total demand of the country. On the contrary, given that, among 190 countries, Argentina is in 21st place among the highest taxation towards their companies, increasing the tax pressure we will lead to much less investment and, therefore, less employment and welfare in the future.
Also, they could give "the little machine" to put money in people's pockets. The trouble is that it would mean trying to put out the fire of "rising inflation" by increasing the fuel; what with the current sharp fall in the demand for pesos could even lead to hyperinflation. However, even if the latter did not happen, it is known that the inflationary tax punishes those who have less; so it is rather a redistribution to the "Hood Robin" instead of "Robin Hood".
So what is the way out? Let's look at a simple example. Suppose I am the butcher of my neighborhood. A responsible guy who wakes up early to control the good quality of the meat they bring me. I open my business on schedule and attend very well to my clientele; So I earn your trust and good money. But one day I start to get up later and, many times, my lazy assistant receives the meat; So nobody controls its quality. I do not always open on time and sometimes I close to go for coffee with my friends. Surely, I will end up losing my clientele because they will stop trusting my butcher shop; so I will earn less and be poorer.
Imagine a friend comes and proposes that, to get ahead, I need to put more money in my family's pocket? Without clients, I have no money or credit. The solution is to ask myself why I came to that situation and begin to regain the trust of my clients. Getting up early, controlling the meat I buy, opening when appropriate and complying with the opening hours. Surely, customers will start to come back and recommend my business again, so I can improve my standard of living.
If we put aside the magic solutions, we should ask ourselves why we are here. And the answer is: for not solving the structural problems of Argentina. For several decades we have lived from crisis to crisis; in which the disastrous results of not facing the pending structural reforms are liquefied. It is what happened in 2002 that implied a phenomenal social cost, with more than 57% of Argentines in poverty. After the debacle, the economy always recovers again and, as in the past, at the later stage of growth not only was it not taken advantage of to address the necessary solutions, but the problems that nobody had solved before were aggravated. Thus, we reached the edge of the precipice in 2015 and continued to wobble there; because the current management was not encouraged to make all the changes demanded by the delicate state of the country.
Therefore, in 2018, in the face of the smallest international tremor, Argentines and foreigners lost confidence and began to take their savings out of Argentina. That involved fleeing the peso and moving to dollars massively, creating a currency crisis. The loss of credibility was such that it left us without enough credit to face our public debt and we did not enter into cessation of payments thanks to the agreement with the IMF; without which we would have had one of the traditional crises, although with the current fall in welfare, impossible to avoid.
How is it solved? As the butcher did, we must recover the trust of the "customers" to bring back their savings and invest in Argentina. For this, on December 11, we must solve the country's deep problems. To face a great reform of the State, that serves the Argentineans and not the politics (as it happens today); but, in addition, so that we can pay it. At present, it is not enough to squeeze workers and entrepreneurs. If we want an economy that gives everyone more opportunities for progress, it is necessary to lower the tax pressure. Also, change the current labor legislation that is incapable of generating productive employment in the 21st century. If we take any year of the last 20, more than 40% of people were unemployed, in informality or with unemployment insurance disguised in a public sector position or a welfare plan. Finally, quickly disarm a network of regulations that drowns, above all, both entrepreneurs and SMEs and whose only aim was to justify the excess of public employment and the eagerness of the enlightened bureaucrats to use their power to decide for their fellow citizens.
True, the ease of magic solutions is attractive; But it only leads to new failures. As mature citizens, we must demand the President-elect to face the hard way of solving the problems that prevent us from growing. The experience of other countries that did it shows that the prize is enormous, not only to avoid a crisis worse than that of 2002, but to be able to triple the purchasing power of all Argentines for three or more in the next 20 years, as happened in them.
By Aldo Abram
(
Sobre qué esperar de los primeros 100 días del gobierno de Alberto Fernández, Solanet fue contundente: “No tengo una respuesta porque se presentan alternativas que dependen del predominio de una u otra tendencia dentro de la coalición que ha ganado las elecciones”.
“Por ahora parece que Alberto Fernández se orienta a una posición más pragmática y eso sería un dato positivo”, destacó.
Pero advirtió: “Por otro lado, la corriente que responde a Cristina Kirchner y a La Cámpora, sobre todo a (Axel) Kicillof, tiene una posición más ideologizada y poco consistente con las medidas que hay que tomar para superar una situación extremadamente difícil en lo fiscal y consecuentemente muy comprometida en la estabilidad de precios y en el equilibrio y pago de la deuda”.
“Creo que si algo define el futuro es que no hay alternativas. Argentina ha utilizado a pleno el crédito del sector privado y de los organismos internacionales, y en este momento no está en condiciones de ampliar su endeudamiento. El déficit primario y el pago de los servicios de la deuda llegan a 5 puntos del PBI, y la deuda empieza a tener vencimientos”.
“De manera que hay generar una situación fiscal diferente y esto tiene que ser resuelto por el lado de la reducción del gasto público, ya que la presión impositiva tampoco da para más. Hay ideas sobre aumento de impuestos, pero esto es como una naranja a la cual se le ha quitado todo el jugo, uno puede seguir apretando y no sale nada más”, explicó.
“El único camino es duro de recorrer, porque es reducir el gasto burocrático, la reducción de los planes sociales, de los subsidios, lo que implica aumentar las tarifas, sobre todo la de energía y el transporte”.
“Esto parece difícil sobre todo para quien hizo campaña para ganar las elecciones basándose en el supuesto perjuicio que hubo para la gente en estas medidas que Macri tomó tímidamente y en forma gradual”, agregó.
Insistió en que “la realidad lleva al Gobierno al único camino que puede recorrer y si lo hace, va a tener apoyo internacional. Pero ese camino parece no ser el que políticamente ha defendido ante quienes le dieron el voto el 27 de octubre”.
Jorge Castro, en tanto, alertó que “el país tiene que pagar 29.000 millones de dólares de deuda externa en 2020, y no los tiene”.
“Debe refinanciar esas obligaciones y en caso de no hacerlo, obligaría a un ajuste en más de 6 puntos del PBI, que es superior al ajuste que ha realizado Macri desde 2018”, reveló.
“No hay alternativa a la refinanciación, pero para acordar con los acreedores privados de Wall Street, primero hay que hacerlo con el Fondo Monetario y no habrá acuerdo con el FMI sin el aval y respaldo del presidente de los Estados Unidos, Donald Trump”, detalló.
“La principal línea de acción del próximo gobierno es un acuerdo con Trump”, reiteró.
“Este es un mundo de realidades”, dijo Castro para graficar: “El presidente Donald Trump fija su posición de gobierno respecto a los distintos países de América del Sur según la posición que tomen respecto al régimen de Nicolás Maduro en Venezuela. No hay acuerdo con el presidente Donald Trump sin una actitud inequívoca de rechazo y aislamiento a Maduro”, concluyó.
Reclamó la necesidad de “corregir el desaliento de la inversión por los regímenes legales impositivos y laborales”, agregando que “hay expectativas de cómo resolver y si no hay medidas estructurales, seguiremos con inflación y desequilibrio fiscal”. “Hay que darle chance de que haga un diagnostico profundo”, manifestó y expuso que “la formación de un Consejo Económico y Social se ha experimentado, es un paliativo, pero es un muy difícil intentar un régimen corporativo en un país que no lo eligió, así que no es una medida económica de fondo”.
Respecto de los dichos sobre pesificación de tarifas, Solanet expuso que “hay un problema con la energía” en nuestro país y que “Vaca Muerta es esencial para el futuro pero debe adaptarse a los precios internacionales porque de otra manera no van a invertir y pesificar en esta área de entrada va a significar que no lleguen inversiones”.
En relación a la relación con Brasil y los dichos del presidente carioca, reclamó que “hay que resolverlo porque no podemos estar enemistados”. Recordó que “Bolsonaro tiene que meditar lo que dice porque no es bueno que suceda esta disputa, así como la actitud de Fernández de pedir la libertad de Lula, que en Brasil se considera que está preso por corrupción”.
Respecto de la relación con México y las posibilidades que ofrece el país azteca, Solanet advirtió que “si es un puente para tomar una posición para retomar relaciones con Maduro no es interesante”. Deslizó que “la vicepresidenta electa lo está presionando para retomar una relación con Venezuela y el está en medio”.