Archivo de Autor

D. Cavallo re Empleo y Salario

17 febrero, 2014
<h3 “”=”” id=”yui_3_13_0_ym1_1_1392646474827_1619″>Domingo Cavallo

Domingo Cavallo

Para Yo
Hoy a las 11:05 AM

Domingo Cavallo


Salarios y empleo, dos informes que vale la pena leer

Posted: 17 Feb 2014 05:45 AM PST

Dos de los centros de pensamiento que tuvieron su orígen en los esfuerzos de la Fundación Mediterránea para promover la investigación aplicada al diseño de buenas política públicas, IDESA y IARAFF acaban de producir sendos informes  cuya lectura recomiento a los visitantes de mi blog.

El artículo de IDESA explica cómo, el restablecimiento del  denominado “Modelo de los superávits gemelos” requiere una fuerte reducción de los salarios reales. Lo interesante es que cuantifica la magnitud de los ajustes que se requerirían y también explica cuál es la forma alternativa de recuperar el crecimiento con menores costos sociales. Se titula “Para restablecer el “Modelo” hay que reducir los salarios

El artículo del IARAFF muestra aque la creación de empleos durante la última década fue, preponderantemente, aumento del empleo público, especialmente en los últimos dos años. El informe se titula: “El Estado como principal demandante de empleo en los dos últimos años

Mis felicitaciones a los investigadores de IDESA y del IARAFF.

   
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Cavallo re Sturzenegger

16 febrero, 2014

El primer paso contra la inflación

16 febrero, 2014

http://opinion.infobae.com/ivan-carrino/2014/02/16/el-sinceramiento-del-indec-no-es-el-primer-paso-para-bajar-la-inflacion/

La decisión Presidencial de no robar más  con emisión monetaria inflacionaria es PRIORIDAD . Algo imposible con el peronismo cristinista, porque a la inflación que finalizó con la convertibilidad la reinventó Duhalde y la aumentaron Néstor y Cristina. El fascismo necesita autoridad para engañar, robar y emitir dinero contra la voluntad del pueblo, que la detesta por nociva para todos, excepto  los Gobernantes.

Si el Presidente fuese  hoy Adolfo Rodríguez Saa, un demócrata en serio, podría el peronismo bajar la inflación. Recordemos el peronista Menem lo hizo, pero diez años después Fernando de la Rúa y Cavallo destrozaron al sistema financiero con el fascista e inconstitucional “corralito”  que por  Decreto Presidencial impidió usar libremente los depósitos a todos el 1 de diciembre de 2001. La gente se alarmó y salió a las calles a protestar. Esto fue aprovechado por el peronismo duro para  diez días después reemplazar al  Presidente no peronista, otro  peronista, precisamente el  rechazado  como candidato a Presidente apenas dos años antes.  El peronismo autoritario ama la inflación como herramienta de enriquecimiento personal y poder absoluto (por un tiempo).

El Pueblo peronista y no peronista detestamos la inflación, siempre empobrece a todos, menos al Presidente de turno y Asociados.

Rodriguez Saa convoca alianza con Macri

16 febrero, 2014

http://www.lanacion.com.ar/1664678-rodriguez-saa-dijo-que-el-kirchnerismo-esta-disolviendo-al-pj-y-llamo-a-una-alianza-con-macr

UN ECONOMISTA IDEALISTA y estabilidad monetaria

15 febrero, 2014

Desde http://opinion.infobae.com/alberto-benegas-lynch/2014/02/15/desenredar-la-madeja/  utiliza un pensamiento liberal idealista. Lo que dice es cierto, en la medida que existan gobernantes serios y honestos, resultado de haber sido elegidos por pueblos civilizados, para gobernar para el bien del conjunto social conocido como “la gente” (the people of Argentina).  Me cuesta disentir con lo expresado por el doctor Benegas Lynch (h) pero noto nos propone una meta, por ahora lejana para la cultura peronista fascista inflacionaria argentina. El purismo económico se asemeja a lo que en Filosofía del Derecho enseñaba Hans Kelsen: un esquema perfecto, donde todo “cierra”, porque se ha legislado para que cada uno de los Poderes del Estado vigile y controle a los dos otros dos. Si los funcionarios públicos fuesen máquinas, funcionaría perfecto. Siendo humanos falibles, la perfección no se alcanza. Pero la evolución hace que ciertos países estén bien gobernados, y la enorme mayoría de paises tenga gobernantes mediocres o esté  dominada por bandidos dictadores.

Aprovecho para otro comentario: el Banco Central aludido en el artículo existe para evitar la emisión de dinero de papel en forma deshonesta en perjuicio de “la gente de Argentina”. Fue el resultado de que algo había que hacer cuando la moneda metálica (de oro o plata) dejó de servir para respaldar las transacciones mundiales, supongo por resultar inconveniente transportar alrededor del mundo enormes cantidades de los citados metales preciosos para servir como contrapartida al intercambio comercial creciente, que ocurrió en el siglo XX.  La crisis mundial monetaria y económica pudo haberse debido a la necesidad de evitar la moneda metálica, por ser un costo  evitable. Veamos:

si la moneda mundial fuese de oro (o de plata) cada país debería invertir enorme cantidad de capital valioso metálico para acuñar monedas cuyo valor intrínseco era igual al valor del bien adquirido. Y grandes transacciones requerirían toneladas de metal precioso, que en algún momento dejaron de ser suficientes para que en el mundo todo intercambio de bienes y servicios fuese cancelado con moneda metálica. Entonces la moneda de papel se fue convirtiendo en algo conveniente y luego necesario, y por último, obligatorio. Pero en paises tramposos, el dinero nacional no es confiable, porque se lo falsifica o se lo emite en forma delictiva por parte de los gobiernos que roban a su gente, tipo Argentina.

Afortunadamente existen países sensatos que tienen dinero nacional serio y confiable, tipo el dólar, el euro, la libra y algunas pocas mas. Entonces a nivel mundial, la totalidad de los países utilizan para transacciones confiables, el dinero de papel que se considera mas serio y confiable. Hoy el dólar sigue liderando en volúmen, seguido por el euro a distancia considerable. Voluntariamente, algunos paises utilizan al dolar como  moneda nacional. Ecuador tiene un sistema inusual:  populismo con moneda nacional dolar, su Presidente no puede enriquecerse con inflación monetaria nacional al no poder  imprimir  dólares. Pero tampoco lo puede President Obama: debe  pedir al Congreso que autorice creación de dinero (y creo también  convencer al Sistema de la Reserva Federal).

Argentina usó al valor del dólar durante diez años y medio, con la convertibilidad menemista, pero fracasamos. Nuestros gobernantes no entendieron el mecanismo, el Banco central menos, y todo terminó en la Estafa Legalizada, denunciada por Steve H. Hanke, que nos convirtió en un país incumplidor al cual se le niega el crédito externo. Aunque Cristina nos lo niegue.  Si en vez de convertibilidad, Menem hubiese logrado dolarizar durante su gobierno, hubiese necesitado que el Congreso lo autorizara por ley. Pero  lo evitó, quizás no lo pensó. O  supuso los legisladores de Argentina opinaban que usar dinero norteamericano era antinacional y antipopular, y el proyecto de dolarizar  se hubiese rechazado. Visto a la distancia, imagino que con dolar yanqui en vez de dinero argentino, nos hubieran robado menos los desgobernantes que tuvimos. Y hubiese sido imposible echarlo a de la Rúa por parte de Duhalde, porque la gente se hubiese negado a pagar a los bancos tasas anuales de interés entre un veinte y veinticinco por ciento anual en dólares, por ser usurarias. De la Rúa hubiese terminado su mandato, hubiésemos tenido elecciones libres, posiblemente Carlos Menem hubiese sido reelecto como por haber sido el Presidente exitoso comprobado. Como reinventor de la moneda nacional seria (dolar) al terminar con la hiperinflación=hiperinflacion  monetaria alfonsinista, y el modelo bolivariano cubano no nos hubiese sido implantado.  Cristina K sería  la actual  futura gobernadora de la Provincia de Santa Cruz. Y en Argentina no faltarían dólares, aunque el Gobierno nacional no pudiese imprimirlos. El mercado los proveería, no necesitaríamos caer en manos de entidades que nos perjudican, tipo el Fondo Monetario y otras, y la gente se sentiría menos insegura y feliz de poder ahorrar en un país cuya moneda nacional es el dólar norteamericano.

Cristina engañó demasiado

14 febrero, 2014

Admitir una inflación existente (menor a la real)  muestra que el fascismo ladrón peronista cristinista llega a su fin. Este desgobierno es incapaz de arreglar sus desastres, porque su gente ha sido entrenada para servir a la Jefa, y ésta demostró incapacidad y falta de salud. Si los Congresistas fuesen gente civilizada sensata y honesta, la Presidenta afrontaría un Juicio Politico, medida Constitucional diseñada para que los argentinos nos liberemos de funcionarios públicos incumplidores o violadores de la ley y la Constitución.

El modelo fascista autoritario ha llegado a conquistar a la mayoría de Diputados, Senadores y Jueces de la Corte Suprema, y por eso no funciona el sistema de la Republica donde el Estado está conformado por tres Poderes (Ejecutivo, Legislativo y Judicial) que se complementan, para impedir precisamente lo que hoy parece hundir a la Argentina: la dictadura de los bandidos que se enriquecen desde el Poder, y la inflación es tan sólo un medio habitual que usan para robar a la sociedad a veces sin que muchos lo adviertan.

Ni la Corte Suprema, ni el Congreso ni la Presidencia son creíbles. Admitir después de años que existió altísima inflación implica reconocer que se ha delinquido desde el Poder. Sorprende que Mauricio Macri se regocije por esta confesión criminal tardía del Gobierno peronista.  La inflación delata al ladrón, el Presidente de turno,  lo sostenemos desde siempre en el blog. El modelo argentino es el fascismo ladrón, desde 1030 hasta hoy. No alcanza con el fracasado de una viuda que heredó el Poder que jamás hubiese por si sola obtenido, ya que los argentinos mayoritariamente descreemos del modelo socialista comunista cubano bolivariano venezolano. Fue necesario un golpe de Estado peronista clásico para derrocar a un incapaz presidente radical como F. de la Rúa e imponer otro peronista sin votos del pueblo, para que ese error implicara dos dramas: dejar a la sociedad argentina sin moneda creíble, y que el fracasado autoritario peronista designado Presidente sin votos fracasara por destruir la moneda.

Esa conjunción de incapacidades delictivas permitió que un desconocido Gobernador de Santa Cruz, Néstor Kirchner, fuese el “delfin” del Gobierno peronista, y sucedió lo inevitable: los “socios” no se respetaron, Néstor desplazó a la mayoría de la Corte Suprema, y se convirtió en dictador “bonachón” que controlaba a la Justicia y al Congreso. El éxito para su patrimonio familiar debe haber estado vinculado a la “obediencia debida” de funcionarios publicos nacionales, provinciales y municipales que no cumplieron con su obligación de investigar seriamente el incremento patrimonial. La Justicia decepcionó, y una sentencia favorable al acusado no fue apelada por el Ministerio Publico Fiscal. Conclusión: si todos los que deben controlar incumplen su tarea, el derrumbe era inevitable. Nadie supongo se alegra en el mundo del fracaso argentino. Es el mismo de los alemanes con Hitler, los españoles con Francisco Franco (hoy serían república si el fascismo degollador ni hubiese triunfado) y los cubanos y venezolanos con su modelo de igualdad socialista comunista mentiroso.

Se dice que hoy manda en Argentina alguien distinto a la Presidenta. Mencionan a Máximo Kirchner algunos, otros a Fidel Castro. Pero ya no importa, la no frenará  la inflación y empobrecimiento creciente antes de dejar el mando en diciembre 10 de 2015. Porque no quiere y además, no puede. La inflación permite ocultar los robos cometidos desde el Poder. Sospecho que  la Guerra de Malvinas sucedió para tapar todo lo robado por el proceso militar iniciado por Videla y Martinez de Hoz. Imaginar que Galtieri era demente no parece sensato. Sospechar que defendía al grupo de militares fracasados que robaron desde el Poder es  algo mejor para escuchar por parte del dominado pueblo argentino. El fascismo trabaja para bien de pocos, la República impide en autoritarismo, para bien de todos y que cada uno logre labrar su propio bienestar, en condiciones parejas.  El fascismo detesta al liberalismo, también la Iglesia Católica es anti liberal, porque forma parte del grupo mafioso donde pocos se enriquecen a costillas de muchos. Recordemos al Vaticano y su inquisición, un modelo mafioso que continúa exitoso, donde los muertos no hablan y sus bienes materiales pasan a las minorías. Y el modelo liberal lo impide, por eso los autoritarios impiden que una Constitución Liberal funcione con libertad para bien de los argentinos. O de los otros países sin Estado de Derecho, que son posiblemente mayoría en el mundo.

Molesta que los mentirosos sigan desgobernando, pero debemos asumir nuestra nueva derrota, esta vez  a mano de los Kirchners. El voto es una herramienta que permite a los paises evolucionados culturalmente a evitar ladrones ostensibles desde el Poder. La mayoría en Argentina eligió que Cristina fuese reelecta – 54% de votos – en 2011, creyeron que Ella regalaría mas bienestar sin esfuerzo a la mayoría, y se engañaron. El modelo era igual a los otros modelos autoritarios mafiosos, que seducen a los seducibles y corruptibles, que tantos no son. Quizás el 1 por mil de la población se benefició con el proceso peronista, son los que forman parte de la minoría.  Aceptar la derrota y esperar que los fascistas, autoritarios ladrones sean derrotados en la elección de 2015 no parece viable. Porque hasta ahora todos los candidatos políticos con posibilidades presidenciales tienen dentro de sí el germen autoritario, ya que fueron parte del peronismo, del radicalismo o del militarismo. Y los socialistas tampoco son gente pura. Ergo, los humanos somos falibles y poco capaces. El nivel cultural permite reducir gradualmente el autoritarismo, pero noto que hace falta mas tiempo del que calculaba. Los golpes de Estado contra sistemas autoritarios lograron que los nuevos Jefes se convirtieran mayoritariamente en bandidos, con pocas excepciones, que no sirvieron. Casi igual ha sucedido en la mayoría de paises, en diferentes edades históricas. Vemos que se difunde en el mundo que Argentina ha retrocedido mucho, porque cien años atrás liderábamos Sud America. Esta derrota nuestra a manos del kirchnerismo servirá – espero – para que gente no autoritaria y menos bandida haga una interna abierta presidencial para el 2015, y los peores pierdan, en vez de triunfar el populismo primitivo

Cavallo re no mentir mas la inflación

14 febrero, 2014
<h3 “”=”” id=”yui_3_13_0_ym1_1_1392394755614_3422″>Domingo Cavallo

Domingo Cavallo

Para Yo
Hoy a las 11:04 AM

Domingo Cavallo


Por Fin!..,ojalá de ahora en más no mientan sobre la inflación

Posted: 13 Feb 2014 05:17 PM PST

Según el INDEC, la inflación de enero ha sido del 3,7% mensual. En el sitioInflacionVerdadera se puede ver que la inflación, en el cuadro de tasa mensual, al 31 de enero, resultó 3,8 %, prácticamente el mismo guarismo que ya había registrado al 31 de diciembre de 2013. La estimación que publica Inflación Verdadera, que es la misma que ha venido publicando la revista británica “The Economist” desde que constató que las cifras oficiales no reflejaban la realidad, es realizada por la empresa “PriceStats“, dirigida por la economista argentina Pilar Iglesias, que desarrolló comercialmente la metodología creada por los profesores Alberto Cavallo y Roberto Rigobón en el MIT.

Hay que festejar, no que en dos meses seguidos la inflación haya sido tan alta, sino el hecho de que, por fin, el INDEC parece dispuesto a decir la verdad. Ojalá sea el inicio de una etapa superadora en materia de veracidad de nuestras estadísticas y no se vuelva a mentir. Entre paréntesis, si en diciembre y en enero la inflación ya fue de ese orden de magnitud, cuando todavía no se pueden haber visto reflejados todos los los aumentos de precios que siguieron al salto devaluatorio del 24 de enero, hay que esperar una tasa probablemente más alta aún en febrero y marzo. No es un buen preámbulo para las discusiones paritarias que comenzarán ese mes.InflaciónVerdadera muestra también la evolución durante los primeros días de febrero y sostiene que la tasa de inflación mensual se aproxima al 5 %.

   
Ojalá sea así Lucas… pero convendría, por prudencia, que prueben primero con un mercado libre y legal, aún cuando no fuera único

Posted: 13 Feb 2014 06:49 AM PST

En “conversando con Cavallo“, Lucas Llach presenta muy buenos argumentos por los que sería posible y conveniente una unificación y liberación completa del tipo de cambio ahora. Además, interpreto que él pregona que la gente pueda tener cuentas tanto en dólares como en pesos en el sistema bancario argentino, es decir, lo que yo denomino convertibilidad flotante a la peruana. Si esto último no se permitiera, en una economia ya tan dolarizada “de hecho” como la de Argentina, el mercado cambiario no sería enteramente libre.

Por supuesto que un mercado cambiario único y libre supondría también eliminar todas las restricciones para las salidas de capitales, incluidas repatriación y distribución de dividendos. Mi gran duda es respecto al nivel al que se estabilizaría el tipo de cambio en este mercado, aún con el compromiso de que no habrá emisión para financiar al Estado. Esta duda surge de comparar la Base Monetaria actual (es decir el dinero ya emitido) con las reservas del Banco Central. Ese cociente (bien calculado) fue, al 31 de enero de 2014 de 16 pesos por Dólar. Si se omiten de la base el valor al tipo de cambio oficial de los encajes de los bancos por depósitos en dólares y no se restan esos encajes de las reservas, como hacen algunos analistas, igual el cociente da un número alto: 13 pesos por dólar. Recuerdo muy bien que en marzo de 1991, cuando dejamos que el Austral flotara libremente luego de emitir todos los australes necesarios para que no quedaran deudas de corto plazo en el Tesoro y resultara creíble el compromiso de no emitir para financiamiento de déficit alguno, el precio del Dólar se estabilizó en 10.000 australes por Dólar, que coincidía aproximadamente con el cociente entre la base monetaria en Australes y las reservas en dólares en el Banco Central.

Alguien podría pensar que el Banco Central tiene el instrumento para reducir significativamente la base monetaria: utilizar las LEBACs no sólo para reabsorber la nueva emisión que demanda el tesoro para financiar su déficit,  sino también hacerlo con buena parte del dinero emitido en el pasado. Por ejemplo, para que el tipo de cambio de convertibilidad plena bajara de 13 a 9,60 deberían colocarse  nuevas LEBACs por 112.000 millones de pesos (hoy el stock  de LEBACs es de 107.000 millones de pesos).  ¿Qué tasa se necesitaría ofrecer para que el mercado estuviera en condiciones de absorber semejante cantidad de LEBACs?

Antes de adoptar decisiones que para un gobierno tan poco creíble como el actual podrían transformarse en un Rodrigazo, yo sugiero que primero dejen funcionar un mercado legal y  libre para el turismo, el atesoramiento y todo tipo de transferencias financieras al exterior. Es sólo una recomendación de prudencia. Cuando Ricardo Zynn y Pedro Pou, en junio de 1975 recomendaron a Celestino Rodrigo que produjera la devaluación que dio lugar al Rodrigazo, también tenía en mente las ventajas de un mercado cambiario único y libre. Ex post facto  no se daban las condiciones como para que ese intento tuviera éxito. Yo temo que hoy pase lo mismo.

   
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(Part two) A Century of Decline

14 febrero, 2014
<h3 “”=”” id=”yui_3_13_0_ym1_1_1392393630305_8200″>Fw: The Economist (Part 2). A Century of Decline

Henry

Para Olo
Hoy a las 9:36 AM
—– Original Message —–

Sent: Friday, February 14, 2014 9:01 AM
Subject: The Economist (Part 2). A Century of Decline
From the print edition.

———- Forwarded message ———-

http://www.economist.com/news/briefing/21596582-one-hundred-years-ago-argentina-was-future-what-went-wrong-century-decline?frsc=dg%7Ca

 

The tragedy of Argentina

A century of decline

One hundred years ago Argentina was the future. What went wrong?

Feb 15th 2014 | BUENOS AIRES | From the print edition

·

·

http://cdn.static-economist.com/sites/default/files/imagecache/full-width/images/print-edition/20140215_FBP002_0.jpgYesterday’s news

WHEN the residents of Buenos Aires want to change the pesos they do not trust into the dollars they do, they go to a cueva, or “cave”, an office that acts as a front for a thriving illegal exchange market. In one cueva near Florida Street, a pedestrian thoroughfare in the centre of the city, piles of pesos from previous transactions lie on a table. A courier is getting ready to carry the notes to safety-deposit boxes.

 

This smallish cueva handles transactions worth $50,000-75,000 a day. Fear of inflation and of further depreciation of the peso, which fell by more than 20% in January, will keep demand for dollars high. Few other ways of making money are this good. “Modern Argentina does not offer what you could call an institutional career,” says one cueva owner.

 

As the couriers carry their bundles around Buenos Aires, they pass grand buildings like the Teatro Colón, an opera house that opened in 1908, and the Retiro railway station, completed in 1915. These are emblems of Argentina’s Belle Époque, the period before the outbreak of the first world war when the country could claim to be the world’s true land of opportunity. In the 43 years leading up to 1914, GDP had grown at an annual rate of 6%, the fastest recorded in the world. The country was a magnet for European immigrants, who flocked to find work on the fertile pampas, where crops and cattle were propelling Argentina’s expansion. In 1914 half of Buenos Aires’s population was foreign-born.

The country ranked among the ten richest in the world, after the likes of Australia, Britain and the United States, but ahead of France, Germany and Italy. Its income per head was 92% of the average of 16 rich economies. From this vantage point, it looked down its nose at its neighbours: Brazil’s population was less than a quarter as well-off.

http://cdn.static-economist.com/sites/default/files/imagecache/original-size/images/print-edition/20140215_FBC282.png

It never got better than this. Although Argentina has had periods of robust growth in the past century—not least during the commodity boom of the past ten years—and its people remain wealthier than most Latin Americans, its standing as one of the world’s most vibrant economies is a distant memory (see chart 1). Its income per head is now 43% of those same 16 rich economies; it trails Chile and Uruguay in its own back yard.

The political symptoms of decline are also clear. If Argentina appeared to enjoy stability in the pre-war era, its history since then has been marked by a succession of military coups. The first came in 1930; others followed in 1943, 1955, 1962, 1966 and 1976. The election of 1989 marked the first time in more than 60 years that a civilian president had handed power to an elected successor.

http://cdn.static-economist.com/sites/default/files/imagecache/original-size/images/print-edition/20140215_FBC288.png

Yesterday’s news

It is now more than 30 years since the end of military dictatorship, but democracy has not yet led to stability. Argentines reach for the metaphor of the “pendulum” to describe the swings of the past three decades: from loose economic policies in the 1980s to Washington-consensus liberalisation in the 1990s and back again under the presidency of Néstor Kirchner and now his widow, Cristina Fernández de Kirchner. But the image of a pendulum does not do justice to the whiplashing of the economy (see charts 2 and 3)—the repeated recessions of the 1970s and 1980s, the hyperinflation of 1989-90, the economic crisis of 2001 and now the possibility of another crisis to come. Argentina is a long way from the turmoil of 2001 but today’s mix of rising prices, wage pressures and the mistrust of the peso have nasty echoes of the past.

http://cdn.static-economist.com/sites/default/files/imagecache/original-size/20140215_FBC287.png

Internationally, too, Argentina has lost its way. It has shut itself out of global capital markets, although negotiations are under way to restructure its debts with the Paris Club of international creditors. Brazil, hardly a free-trade paragon, is pressing Argentina to open its borders; once it would have been the other way round. “Only people this sophisticated could create a mess this big,” runs a Brazilian joke that plays on Argentines’ enduring sense of being special.

One hundred years of ineptitude

The country’s dramatic decline has long puzzled economists. Simon Kuznets, a Nobel laureate, is supposed to have remarked: “There are four kinds of countries in the world: developed countries, undeveloped countries, Japan and Argentina.” Other countries have since managed to copy Japan’s rapid industrialisation; Argentina remains in a class of its own. There is no shortage of candidates for the moment when the country started to go wrong. There was the shock of the first world war and the Depression to an open trading economy; or the coup of 1930; or Argentina’s neutrality in the second world war, which put it at odds with America, the new superpower. There was the rise of Juan Domingo Perón, the towering figure of 20th-century Argentina, who took power in 1946. Others reckon that things really went downhill between 1975 and 1990.

No one theory solves the puzzle. “If a guy has been hit by 700,000 bullets it’s hard to work out which one of them killed him,” says Rafael di Tella, who has co-edited a forthcoming book on Argentina’s decline. But three deep-lying explanations help to illuminate the country’s diminishment. Firstly, Argentina may have been rich 100 years ago but it was not modern. That made adjustment hard when external shocks hit. The second theory stresses the role of trade policy. Third, when it needed to change, Argentina lacked the institutions to create successful policies.

Take each in turn. The first explanation is that Argentina was rich in 1914 because of commodities; its industrial base was only weakly developed. Filipe Campante and Edward Glaeser of Harvard University compared Buenos Aires before the first world war with Chicago, another great shipment hub for meat and grains. They found that whereas literacy rates stood at 95% in Chicago in 1895, less than three-quarters of porteños, as residents of Buenos Aires are known, knew how to read and write.

 

The landowners who made Argentina rich were not so bothered about educating it: cheap labour was what counted. That attitude prevailed into the 1940s, when Argentina had among the highest rates of primary-school enrolment in the world and among the lowest rates of secondary-school attendance. Primary school was important to create a sense of citizenship, says Axel Rivas of CIPPEC, a think-tank. But only the elite needed to be well educated.

Without a good education system, Argentina struggled to create competitive industries. It had benefited from technology in its Belle Époque period. Railways transformed the economics of agriculture and refrigerated shipping made it possible to export meat on an unprecedented scale: between 1900 and 1916 Argentine exports of frozen beef rose from 26,000 tonnes to 411,000 tonnes a year. But Argentina mainly consumed technology from abroad rather than inventing its own.

Technological innovation needs not only educated people but access to money. Argentina’s golden age was largely foreign-funded. Half of the country’s capital stock was in foreign hands in 1913, further exposing it to external shocks. Low levels of domestic savings can in part be explained by demography: large numbers of immigrants with dependent children spent money rather than saving it.

Traders of the lost past

Argentina had become rich by making a triple bet on agriculture, open markets and Britain, then the world’s pre-eminent power and its biggest trading partner. If that bet turned sour, it would require a severe adjustment. External shocks duly materialised, which leads to the second theory for Argentine decline: trade policy.

The first world war delivered the initial blow to trade. It also put a lasting dent in levels of investment. In a foreshadowing of the 2007-08 global financial crisis, foreign capital headed for home and local banks struggled to fill the gap. Next came the Depression, which crushed the open trading system on which Argentina depended; Argentina raised import tariffs from an average of 16.7% in 1930 to 28.7% in 1933. Reliance on Britain, another country in decline, backfired as Argentina’s favoured export market signed preferential deals with Commonwealth countries.

Indeed, one way to think about Argentina in the 20th century is as being out of sync with the rest of the world. It was the model for export-led growth when the open trading system collapsed. After the second world war, when the rich world began its slow return to free trade with the negotiation of the General Agreement on Tariffs and Trade in 1947, Argentina had become a more closed economy—and it kept moving in that direction under Perón. An institution to control foreign trade was created in 1946; an existing policy of import substitution deepened; the share of trade as a percentage of GDP continued to fall.

These autarkic policies had deep roots. Many saw the interests of Argentina’s food exporters as being at odds with those of workers. High food prices meant big profits for farmers but empty stomachs for ordinary Argentines. Open borders increased farmers’ takings but sharpened competition from abroad for domestic industry. The pampas were divided up less equally than farmland in places like the United States or Australia: the incomes of the richest 1% of Argentines were strongly correlated with the exports of crops and livestock. As the urban, working-class population swelled, so did the constituency susceptible to Perón’s promise to support industry and strengthen workers’ rights.

There have been periods of liberalisation since, but interventionism retains its allure. “One-third of the country—the commodities industry, engineers and regional industries like wine and tourism—is ready to compete,” says Sergio Berensztein, a political analyst. “Two-thirds are not.”

The divide between farmers and workers endures. Heavy export taxes on crops allow the state to top up its dwindling foreign-exchange reserves; limits on wheat exports create surpluses that drive down local prices. But they also dissuade farmers from planting more land, enabling other countries to steal market share. The perverse effects of intervention have been amply demonstrated in the Kirchner era: according to the US Department of Agriculture, Argentina was the world’s fourth-largest exporter of wheat in 2006. By 2013 it had dropped to tenth place. “The Argentine model of 100 years ago—producing as much as you can—is the one others now follow,” laments Luis Miguel Etchevehere, the president of the Rural Society of Argentina, a farmers’ lobby.

Distribution centre

Some commodity-rich economies have resolved these tensions. Australia, for example, shared many of the traits of early 20th-century Argentina: lots of commodities, a history of immigration and remoteness from big industrial centres. Yet it managed to develop a broader-based economy than Argentina and grew faster. Between 1929 and 1975 Australian income per person increased at an average annual rate of 0.96%, compared with 0.67% in Argentina.

Australia had some big advantages: the price of minerals does not affect domestic consumers in the same way as the price of food, for instance. But it also had the institutions to balance competing interests: a democracy in which the working class was represented; an apprenticeship system; an independent Tariff Board to advise the government on trade. Argentina had not evolved this political apparatus, despite an early move to universal male suffrage in 1912. The third theory for Argentine decline points to the lack of institutions to develop long-term state policies—what Argentines call política de Estado.

http://cdn.static-economist.com/sites/default/files/imagecache/full-width/images/print-edition/20140215_FBP003_0.jpgYesterday’s news

The constant interruptions to democracy are not the only manifestation of this institutional weakness. The Supreme Court has been overhauled several times since Perón first changed its membership in 1946. Presidents have a habit of tinkering with the constitution to allow them to serve more terms: Ms Fernández was heading this way before poor mid-term election results last year weakened her position.

Property rights are insecure: ask Repsol, the Spanish firm whose stake in YPF, an Argentine oil company, was nationalised in 2012. Statistics cannot be trusted: Argentina was due this week to unveil new inflation data in a bid to avoid censure from the IMF for its wildly undercooked previous estimates. Budgets can be changed at will by the executive. Roberto Lavagna, a former economy minister, would like to see a requirement for parliamentary approval of budget amendments.

The next century

First, Argentina has to get out of its mess. Keen to husband its stock of foreign reserves and to close the gap between the official and unofficial exchange rates, the central bank allowed the peso to slide last month. To prevent the depreciation from fuelling inflation expectations, it has raised interest rates. But further tightening will be needed. Rates remain negative in real terms; upcoming wage negotiations will be a test of how serious the government is about controlling spending.

Ms Fernández will probably struggle on until the 2015 presidential election, which optimists see as a turning-point. Economic wobbles before the election may discredit Peronism’s claim to be the party of strong government. But Peronism is a remarkably plastic political concept, capable of producing both the neoliberal policies overseen by Carlos Menem in the 1990s and the redistributive policies of the Kirchners. The idea of a party that pays the price of bad policies does not seem to apply.

Short-termism is embedded in the system. Money is concentrated in the centre, and the path to power goes via subsidies and splurging: the Kirchners are only the latest culprits, turning a fiscal surplus of 2% of GDP in 2005 into an estimated 2% deficit last year. “We have spent 50 years thinking about maintaining government spending, not about investing to grow,” says Fernando de la Rúa, a former president who resigned during the 2001 crisis.

This short-termism distinguishes Argentina from other Latin American countries that have suffered institutional breakdowns. Chile’s military dictatorship was a catastrophic fracture with democracy but it introduced long-lasting reforms. Mexico’s Institutional Revolutionary Party governed steadily for most of the 20th century. “In Argentina institution-building has taken the form of very quick and clientilist redistribution,” says Daron Acemoglu of the Massachusetts Institute of Technology.

It will take an unusual politician to change Argentina’s institutions, especially if another commodities windfall eases the pressure to reform. The country’s Vaca Muerta (“Dead Cow”) shale-oil and gasfield is estimated to be the world’s third-largest. If Argentina can attract foreign capital, the money could start flowing within a decade. “Vaca Muerta gives us huge capacity to recover and huge opportunity to make mistakes,” says Mr Lavagna.

Argentines themselves must also change. The Kirchners’ redistributive policies have helped the poor, but goodies such as energy subsidies have been doled out to people who do not really need them. Persuading the population to embrace the concept of necessary pain will be difficult. That is partly because the experience of the 1990s discredited liberal reforms in the eyes of many Argentines. But it is also because reform requires them to confront their own unprecedented decline. No other country came so close to joining the rich world, only to slip back. Understanding why is the first step to a better future.

From the print edition: Briefing

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Venezuela and Argentina: The party is over

14 febrero, 2014
Marketeck

Para gourmandizers1912Yo
Feb 13 a las 7:39 PM

Venezuela and Argentina

The party is over

Latin America’s weakest economies are reaching breaking-point

Feb 1st 2014 | BUENOS AIRES AND CARACAS From the print edition

 

 

WHEN the euro crisis was at its height it became commonplace for struggling European economies to insist that they were not outliers like Greece. Whatever their woes, they declared, Greece’s were in a class of their own. In Latin America, by contrast, the unwanted title of outlier has two contenders: Argentina and Venezuela.

Both have been living high on the hog for years, blithely dishing out the proceeds of an unrepeatable commodities boom (oil in Venezuela; soya in Argentina). Both have been using a mix of central-bank interventions and administrative controls to keep overvalued exchange rates from falling and inflation from rising. Both now face a come-uppance.

 

High inflation is a shared problem. Argentina’s rate, propelled higher by loose monetary and fiscal policies, is unofficially put at 28%. Argentina’s official exchange rate is overvalued as a result, fetching 70% more dollars per peso than the informal “blue” rate in mid-January. Venezuela’s prices are rising faster still. Last year, during an awkward political transition after the death of Hugo Chávez to the presidency of Nicolás Maduro (pictured with Cristina Fernández de Kirchner, the Argentine president), the Central Bank stepped up money-printing to finance public spending, pushing inflation to 56.2%. A dollar fetches 75-80 bolívares on the black market, up to seven times the official rate.

 

 

Both countries have dwindling arsenals with which to defend their overvalued currencies. Venezuela’s reserves of gold and foreign currency, which stood at nearly $30 billion at the end of 2012, were down to just over $21 billion by last week. Only about $2 billion of that is in liquid assets. Ecoanalítica, a research firm, estimates that the government can also dip into around $13 billion of opaque, off-budget funds. Argentina’s reserves have also been tumbling (see chart).

Something had to give, and late last month it did. Argentina first allowed the peso to plunge, by more than 15% in the week starting January 20th, and then announced a relaxation of the government’s ban on buying foreign currency for saving purposes. Argentines making over 7,200 pesos ($900) monthly are now able to change 20% of their salary into dollars at the official exchange rate so long as they get approval from AFIP, Argentina’s tax agency. The dollars are transferred to their bank accounts, not released in cash, and hit by a 20% fee if withdrawn before a year. If that sounds complicated, it is still cheaper than buying dollars in the illegal market.

The government’s objective seems to be to close the gap between the official and blue exchange rates, alleviating the need to spend more of those precious reserves to prop up the official rate. Although the gap has closed a little, fear that devaluation will lead only to yet higher inflation explains continued high demand for dollars, even at the less favourable exchange rate. So too does the fact that only a third of Argentine workers meet the declared-income threshold for buying dollars, according to analysis by IARAF, a think-tank.

Guido Sandleris of the University Torcuato di Tella says the plan is doomed to failure unless the government becomes more open about its intentions and adopts a genuinely restrictive set of policies to battle inflation. Although the Central Bank this week raised one of its interest rates by a full six percentage points, rates remain below inflation, giving Argentines little reason to hold pesos.

On the fiscal front the government needs to reduce subsidies and remain unyielding in the face of workers’ demands for pay rises. Miguel Kiguel of EconViews, a consultancy, says wage increases to be negotiated in March and April must remain under 30% if they are to serve as an anti-inflationary anchor. That will be hard given lavish pay awards handed out to striking policemen last year.

Whether the government is willing to put prudence before politics is not clear. On the day that her government let the peso’s slide turn into a slump, Ms Fernández announced a plan to fund education for unemployed 18- to 24-year-olds that could cost 11 billion pesos. Her only reference to the currency’s fall was a tweet accusing banks of helping favoured investors to speculate on the peso. There are some people, she wrote, who “want to make us eat soup again, but this time with a fork.”

At least Argentina’s partial liberalisation of currency controls is a halting step towards normality. Venezuela, where the situation is even more perilous, is heading in the other direction. On January 22nd the government unveiled new rules under which a higher rate for non-essential transactions is set weekly (it stood at 11.36 bolívares to the dollar this week). The old rate of 6.3 still applies for government imports and basic items such as food and medicine, so reserves will keep falling as the government defends the currency.

Venezuela is running out of dollars to pay its bills. Although payments to its financial creditors of around $5 billion this year do not appear to be at risk, the country’s arrears on non-financial debt are put at over ten times that sum. These include more than $3 billion owed to foreign airlines for tickets sold in bolívares, and around $9 billion in private-sector imports that have not been paid for because of the dollar shortage. “Under the current economic model, and with this economic policy,” says Asdrúbal Oliveros of Ecoanalítica, “this [debt] looks unpayable.”

The effects are already apparent. Foreign airlines have placed tight restrictions on ticket sales; some have suspended them altogether. Many drugs and spare parts for medical equipment are unavailable. Car parts, including batteries, are increasingly hard to find; newspapers are closing for lack of paper. The country’s largest private firm, Empresas Polar, which makes many basic foodstuffs, is struggling to make some products. In a statement Polar said the government owed it $463m and that production was “at risk” because foreign suppliers of raw materials and packaging were threatening to halt shipments.

 

 

The government blames the crisis on private businesses and “irresponsible” use of hard currency by ordinary Venezuelans. It has ordered drastic cuts in dollar allowances for travellers, especially to popular destinations like Miami. Remittances to relatives abroad have also been slashed. In a bid to curb runaway inflation, it has introduced a new law restricting companies’ profits to 30% of costs. Long jail sentences await transgressors.

Without a big injection of dollars from the state oil company, Petróleos de Venezuela, which brings in 96% of foreign earnings, the crunch will continue. Better terms for foreign investors in the oil industry would bring in much-needed cash and boost stagnant production. But unless the government abandons its antipathy to private capital, the prospect of new investment is dim. Shortages of goods are only likely to worsen. If Argentina is an outlier, Venezuela risks straying into a different category entirely.

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The parable of Argentina

14 febrero, 2014
<h3 “”=”” id=”yui_3_13_0_ym1_1_1392393630305_3615″>The Economist The parable of Argentina

Henry

Para Yogourmandizers1912
Feb 13 a las 7:13 PM

Government

The parable of Argentina

There are lessons for many governments from one country’s 100 years of decline

Feb 15th 2014 | From the print edition

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A CENTURY ago, when Harrods decided to set up its first overseas emporium, it chose Buenos Aires. In 1914 Argentina stood out as the country of the future. Its economy had grown faster than America’s over the previous four decades. Its GDP per head was higher than Germany’s, France’s or Italy’s. It boasted wonderfully fertile agricultural land, a sunny climate, a new democracy (universal male suffrage was introduced in 1912), an educated population and the world’s most erotic dance. Immigrants tangoed in from everywhere. For the young and ambitious, the choice between Argentina and California was a hard one.

There are still many things to love about Argentina, from the glorious wilds of Patagonia to the world’s best footballer, Lionel Messi. The Argentines remain perhaps the best-looking people on the planet. But their country is a wreck. Harrods closed in 1998. Argentina is once again at the centre of an emerging-market crisis. This one can be blamed on the incompetence of the president, Cristina Fernández, but she is merely the latest in a succession of economically illiterate populists, stretching back to Juan and Eva (Evita) Perón, and before. Forget about competing with the Germans. The Chileans and Uruguayans, the locals Argentines used to look down on, are now richer. Children from both those countries—and Brazil and Mexico too—do better in international education tests.

Why dwell on a single national tragedy? When people consider the worst that could happen to their country, they think of totalitarianism. Given communism’s failure, that fate no longer seems likely. If Indonesia were to boil over, its citizens would hardly turn to North Korea as a model; the governments in Madrid or Athens are not citing Lenin as the answer to their euro travails. The real danger is inadvertently becoming the Argentina of the 21st century. Slipping casually into steady decline would not be hard. Extremism is not a necessary ingredient, at least not much of it: weak institutions, nativist politicians, lazy dependence on a few assets and a persistent refusal to confront reality will do the trick.

All through my wild days, my mad existence

As in any other country, Argentina’s story is unique. It has had bad luck. Its export-fuelled economy was battered by the protectionism of the interwar years. It relied too heavily on Britain as a trading partner. The Peróns were unusually seductive populists. Like most of Latin America, Argentina embraced the Washington consensus in favour of open markets and privatisation in the 1990s and it pegged the peso to the dollar. But the crunch, when it came in 2001, was particularly savage—and left the Argentines permanently suspicious of liberal reform.

Ill fortune is not the only culprit, though (see briefing). In its economy, its politics, and its reluctance to reform, Argentina’s decline has been largely self-inflicted.

Commodities, Argentina’s great strength in 1914, became a curse. A century ago the country was an early adopter of new technology—refrigeration of meat exports was the killer app of its day—but it never tried to add value to its food (even today, its cooking is based on taking the world’s best meat and burning it). The Peróns built a closed economy that protected its inefficient industries; Chile’s generals opened up in the 1970s and pulled ahead. Argentina’s protectionism has undermined Mercosur, the local trade pact. Ms Fernández’s government does not just impose tariffs on imports; it taxes farm exports.

Argentina did not build the institutions needed to protect its young democracy from its army, so the country became prone to coups. Unlike Australia, another commodity-rich country, Argentina did not develop strong political parties determined to build and share wealth: its politics was captured by the Peróns and focused on personalities and influence. Its Supreme Court has been repeatedly tampered with. Political interference has destroyed the credibility of its statistical office. Graft is endemic: the country ranks a shoddy 106th in Transparency International’s corruption index. Building institutions is a dull, slow business. Argentine leaders prefer the quick fix—of charismatic leaders, miracle tariffs and currency pegs, rather than, say, a thorough reform of the country’s schools.

They are not the solutions they promised to be

Argentina’s decline has been seductively gradual. Despite dreadful periods, such as the 1970s, it has suffered nothing as monumental as Mao or Stalin. Throughout its decline, the cafés of Buenos Aires have continued to serve espressos and medialunas. That makes its disease especially dangerous.

The rich world is not immune. California is in one of its stable phases, but it is not clear that it has quit its addiction to quick fixes through referendums, and its government still hobbles its private sector. On Europe’s southern fringe, both government and business have avoided reality with Argentine disdain. Italy’s petulant demand that rating agencies should take into account its “cultural wealth”, instead of looking too closely at its dodgy government finances, sounded like Ms Fernández. The European Union protects Spain or Greece from spiralling off into autarky. But what if the euro zone broke up?

The bigger danger, however, lies in the emerging world, where uninterrupted progress to prosperity is beginning to be seen as unstoppable. Too many countries have surged forward on commodity exports, but neglected their institutions. With China less hungry for raw materials, their weaknesses could be exposed just as Argentina’s was. Populism stalks many emerging countries: constitutions are being stretched. Overreliant on oil and gas, ruled by kleptocrats and equipped with a dangerously high self-regard, Russia ticks many boxes. But even Brazil has flirted with economic nationalism, while, in Turkey, the autocratic Recep Tayyip Erdogan is blending Evita with Islam. In too many parts of emerging Asia, including China and India, crony capitalism remains the order of the day. Inequality is feeding the same anger that produced the Peróns.

The lesson from the parable of Argentina is that good government matters. Perhaps it has been learned. But the chances are that in 100 years’ time the world will look back at another Argentina—a country of the future that got stuck in the past.


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