2023-12-31 05:15:03
While digesting Javier Milei’s DNU, recently followed by the omnibus law, Argentine society still does not know if it will be good or bad, if it will harm or benefit it or, in any case, how each one will be left unemployed after its 366 articles come into effect. Politics, on the other hand, which understands well the ideological challenge posed, prefers to avoid substantive debate and chooses to question so much need and urgency.
From these columns we have supported the purpose of eliminating niches of privilege and making the economy more flexible for a profound transformation of the Argentine productive structure. And we have also pointed out that, for these modifications to be solid and lasting, they must have political support through parliamentary approval in accordance with the precepts of the national Constitution.
It is notable that Unión por la Patria has objected to the presidential DNU, invoking the rule of law when Kirchnerism diverted all kinds of norms for its own benefit.
However, it is necessary that a sincere debate be opened regarding the model that is intended to be left behind and that the objectors explain what other alternatives they propose so that our country can grow in a global context that does not admit laggards, driven by digital technologies that require prioritization. education, investment and the ability to adapt to global markets. Even Spain and Italy have fallen in the ranking of nations, compared to China, India and Indonesia due to lack of competitiveness, population aging and institutional rigidity.
Argentina has accumulated regulations and special regimes inspired by post-war doctrines, when it was believed that it was possible to substitute imports, guarantee income, employ labor, populate remote areas, manufacture essential inputs, promote lagging productions, energize strategic sectors, favor basic industries , medium and small without affecting the competitiveness of the whole. Thus were born the sacred cows that walk through our streets, without anyone ever daring to get them out of the way to improve the fluidity of productive traffic.
State companies are hunting grounds for union members and suppliers. Several were privatized by Carlos Menem, but Kirchnerism did not want to lose those boxes, so it re-nationalized them or forced their sale to friends.
With their cowbells called national purchase, industrial promotion, development credits, tariff barriers, captive markets, prior licenses, official registries, preferential dollars, mandatory unions, labor taxes, labor inflexibility, judgment industry, compulsory contributions and sectoral privileges each It blocks the passage of others as in India, causing poverty as in Calcutta. Similar regulations were also extended to professions, services and many commercial activities at the request of chambers, colleges, councils and unions with explicit or tacit support from the left and right.
Behind it were ideologies of all kinds, from the push for a “national bourgeoisie” allied to power (CGE, 1952) to the deterioration of the terms of trade (ECLAC, Prebisch); the doctrine of national defense and the Marxist theory of dependency. These sacred cows were fed by civilians and military, Peronists and radicals, conservatives and socialists, creating faits accomplis with thousands of associated jobs that now constitute the most serious obstacle to the modernization of the country.
Following the commanding formula of former candidate Sergio Massa, it would be a great contribution if those who oppose pulling Argentina out of the hole responded “yes or no” to the main aspects of deregulation.
Behind each rule, regulatory revenues were generated for the benefit of businessmen, union members and politicians who knew how to make fortunes with those rules of the game. Well, in Argentina the most profitable markets do not operate in the open, according to the supply and demand postulated by Adam Smith, but in the ins and outs of ministries with bags in the bathrooms, envelopes under the table and front men in subcontracts. Those who came out to “cacerolear” against Milei’s DNU have, without knowing it, done a great favor to those who used the national purchase to increase the cost of projects for their benefit; to industrial promotion to artificially deduct VAT and to union members who receive “returns” on social work contracts without accountability or control from anyone. We cannot say the same about the Tierra del Fuego regime, which allows the use of official currencies on imports at prices that have never been audited, since it was not included despite the fact that Law 19,640 allows the removal of benefits without repealing it.
The DNU also deregulates activities suffocated by the attempt to “align prices with salaries” that Cristina Kirchner ordered as a solution to runaway inflation due to her other crazy axiom “where there is a need, there is a right.” The inevitable adjustment of relative prices in rates, fuel, transportation, rentals and prepaid bills is part of the pain that society must suffer for years of populist debauchery to open a future of hope to its children.
The presidential proposals have had the virtue of forcing an unexpected and timely debate when the country requires structural changes to avoid becoming a failed nation.
It is notable that Unión por la Patria has objected to it, invoking the rule of law when Kirchnerism diverted all kinds of norms to benefit friends of power, as is public and notorious. The case of Cristóbal López is paradigmatic. Through a DNU, Néstor Kirchner renewed Alcalis de la Patagonia (“Solvay soda”) tax benefits that had already expired after denying them to its previous owners, forcing them to sell the company to López for the amount of the liability. This is a scheme similar to the one used in 2008 with Repsol to transfer YPF shares to the Eskenazi group without putting in a cent and whose corollary is the more than 16 billion dollars that the treasury will have to pay for the “vivacity” of Axel Kicillof to the expropriate the majority package.
State companies are hunting grounds for unionists and suppliers. Several were privatized by Carlos Menem, but Kirchnerism did not want to lose those boxes, so it re-nationalized them or forced their sale to friends. The gigantic yacht Attila, which belonged to Mauricio Filiberti, chlorine supplier to the loss-making Aysa, reflects this painful asymmetry financed by emission. The audacity through which Malena Galmarini extended her contract until 2028, shortly before the elections, demonstrates how campaign support is rewarded.
Sergio Massa’s wife learned from Néstor Kirchner, who in 2017 – as the last act of his presidential administration – extended the concession of the Palermo Hippodrome slot machines until 2032 in favor of Cristóbal López, converting the failed equestrian investment of the financial company Valfinsa ( Federico de Achával) in a gold mine.
The inevitable adjustment of relative prices in rates, fuel, transportation, rentals and prepaid bills is part of the pain that society must suffer to open a future of hope for its children after years of populist debauchery.
The country is going through a very serious crisis that can only be reversed with a “shock of confidence” that restores credit, recovers the value of the currency and lifts the population out of poverty. To this end, it is essential that the different political sectors express whether they agree or not with the main aspects of the deregulation decreed by the President of the Nation, without prejudice to objecting to it – if they deem it pertinent – regarding the form used to implement it. And if they do not agree with it, they should explain what their alternative economic plan would be.
Using the commanding formula of former candidate Sergio Massa, it would be a great contribution if they answered “yes or no” to that question, since an affirmative answer would provoke an immediate positive reaction in the investment climate, perceptibly reducing the negative consequences of the inflationary jump. caused by the correction of prices relative to those with fixed incomes.
Although the ways adopted by Milei to correct historical distortions of Argentine productive activities may be objected to, his proposals, as dissimilar as they are risky, have had the virtue of forcing an unexpected and timely debate when the country requires structural changes to avoid becoming a failed nation, as so many others co-opted by tribes, mafias or autocracies. It is important then that, out of patriotism or necessity, politics takes up the challenge and debates the substance of deregulation, with its pants removed.
#Deregulation