Federal Capital (Paco Urondo Agency, published in Journal BAE, the 12/03/2010)
There is consensus among mainstream economists - neoliberal, including some self-described as heterodox economists - progressive and the arch opponent of the national government that success in terms of economic growth and reducing unemployment and poverty in today's economy is only due to high international commodity prices that Argentina exports such as soybeans. What these sectors call a tail wind. Even some economists argue that if the currency board would have had these international prices, the model introduced in the nineties had been successful.
Should we deny the benefits brought by the increase in international prices of food and raw materials? Of course not. It is important to increase exports trade surplus and growing reserves into the hands of the Central Bank of Argentina. Now, the current model of development can only be explained by favorable conditions in the foreign market? The answer is also no. For this it is interesting to make a summary of the economic and social policies have been implemented since 2003 to the present and do not respond to the international context but a purely political decision. But these policies are also those that explain most of the success of the new accumulation model introduced by Néstor Kirchner and deepened by President Cristina Fernández Kirchner.
competitive exchange rate: the devaluation of the exchange rate allows industries to be competitive and thus able to stop the "boom" importer of the nineties that led to the deindustrialization Argentina's economy since the scheme was convertible imported goods cheaper than those produced domestically. With the new competitive exchange rate is returned to a period of industrialization, because the manufacturing sector, mainly small and medium businesses is labor intensive BOUT be competitive again. For Furthermore, this process of re-industrialization is the central cause that produced a significant reduction in unemployment.
Deductions: that allow both. First, disconnect the international prices of the inmates. Thus, the retention act as anti-inflationary policy. Indeed, if there were withholding food producing sectors exported as much possible products, shortages on the domestic market which would lead to a rise in food and increased poverty and destitution. On the other hand, allows deductions national state to increase tax revenue sustain increased public investment in infrastructure that enables growth of the domestic market. But it also allows more resources to subsidize the economy and the population in basic services like public transport. It is important to note that the retention is a progressive tax, ie, they pay more than high-income sectors. In summary, the retention is a policy of income distribution.
collective labor agreements and minimum wage increase, vital and : the re-establishment of collective bargaining agreements that allow each year employees not only discuss the wage increase, but also working conditions. However, the collective bargaining agreement covers employees in white or registered. So we applied a steady increase in the minimum wage, vital and from 200 pesos in 2003 to 1,740 in 2010. This is important because any increase in the minimum wage creates a vital and increasing the wages of black workers or not registered. Therefore, this policy was generated restructuring of wages as white workers and workers not registered, which also means a larger increase in domestic market.
external debt reduction policy: achieved a strong external public sector debt reduction through the restructuring of public external debt (2005 and 2010) which allowed the reduction of it. Ie, capital was reduced external public debt and interest, freeing up state resources that can be used for other objectives such as public investment. Therefore, debt restructuring allowed from the reduction of public debt resources have gone abroad to pay the debt could be allocated to increase the domestic market.
expansionary fiscal policy: in the current model there is a steady increase in public expenditure and investment of the state that allows continued growth of the domestic market while building the economic infrastructure necessary to sustain social and economic growth (eg investment in energy). But at the same time increasing public spending the government maintains fiscal surplus gives strength to the nation state and the economy in general. This feature of the nation state can achieve from a steady increase in tax collection as a result of economic growth and the establishment of retention. Conclusion: the state invests more while maintaining a fiscal surplus.
Pension reform: the pension reform was to increase coverage. In this sense, it included approximately 2,200,000 new retirees could not have retired because they had the necessary inputs (from this the Argentine pension system is the one with the broadest coverage of Latin America). In addition, they are guaranteed two pension increase per year, ie, one each semester. It also increases minimum retirement steadily spent 150 pesos in 2003 to 1,045 pesos in 2010. Therefore, the pension reform means more retirees and permanent increase of pensions, so this also translates into a strong domestic market growth.
renationalisation of the administrators: recover resources that were in the hands of the administrators and were intended for financial recovery (eg the purchase and sale of shares companies) and start using those resources to the distribution of income and strengthening the domestic market. With the nationalization of AFJP these resources began to be used for example for the family allowance per child, the plan to connect equality and the granting of various loans for job generation.
Social Plans: in this regard stresses the family allowance per child and worker cooperatives. Allow one hand to improve income distribution and poverty reduction. But it also allows the continued growth in domestic market and hence output growth.
countercyclical policies: in the international financial crisis in 2008, the national government, as opposed of what happened during the eighties and nineties, instead of adjustment policies would have implied a contraction of domestic consumption, conducted a series of counter-cyclical policies such as increasing public investment or the program REPRO (which meant that the national government to subsidize the salaries of workers in companies with financial problems with the condition not to lay off workers) permitting the maintenance of the domestic market and thus able to absorb the effects of the crisis in the national economy.
primarily From these measures can be understood that the success of current model is the re-industrialization with domestic market growth and resulting in the reduction of unemployment, poverty and improvement in social inequality more dependent on internal pulse generated by the various financial measures Social and applied by the national government.
What is about the collective bargaining agreement, the family allowance per child, the nationalization of the administrators, pension reform, counter-cyclical policies, labor unions, withholding, expansionary fiscal policy external debt reduction policy with the high price of commodities? Nothing. Put another way, there could be international commodity prices high and not be a word that has been done since 2003 that is what enables continued growth with re-industrialization and social inclusion.
There is a phrase that says "I pushed you but you have to put wheels for this to work." The tail wind is the push, but the economic and social policies implemented since 2003 is the national hurricane that allows the success of the current development model.
The author is an economist of the Study Group of National Economy People (GEENaP) www.geenap.com.ar (Paco Agency Urondo)
0 comments:
Post a Comment