Federal State spends more in interests than in wages

The decision that the Central Bank stops financing the Treasury is a good practice in institutionalism and transparency.  But it does not solve the basic problem which is the endemic fiscal deficit. Whatever the strategy to control the dollar is, success is tied to a credible plan to reduce public spending. (more…)

Less public spending are needed, not more dollars

The escalation of the dollar generates anxiety. The process will not be stopped by the Central Bank selling more dollars. To control the situation a consistent plan to reduce the fiscal deficit is required. This must include improving the management of social programs and ending inequities in the pension system. (more…)

JOB GENERATION HAS IMPROVED IN THE FIRST QUARTER

The official information on the situation of the labor market gives indications that at the beginning of the year the job creation capacity of the companies was recovering. But surely the process was interrupted. Strengthening this incipient labor improvement is another reason to accelerate the public finance ordering. (more…)

DOLLAR RISES BECAUSE LOW PRODUCTIVITY NOT DUE TO THE CENTRAL BANK

The devaluation put an end to the artificial increase in the purchasing power in terms of dollars caused by the financing of the fiscal deficit with external debt. To generate sustainable improvements of income in term of dollars, there is no need of better Central Bank presidents but genuine increases in productivity. (more…)

BEFORE THE CENTRAL BANK, PUBLIC SECTOR MUST BE RESTRUCTURED

The agreement with the IMF stipulates that the national Treasury will not be able to receive financing from the Central Bank anymore. This requires accelerating the reduction in public spending. To this end, a more comprehensive restructuring of the public spending must be addressed, including the social spending. (more…)

Subsidies are the only public expenditure that have dropped

The presidential veto to an opposition initiative ordering the comeback of the utility subsidies laid bare the mediocrity of politics. The fiscal situation is critical and the reduction of subsidies is the only advance. Ordering the public finances demands a more integral approach that includes a pension system reform and the reconstruction of federalism. (more…)

1 out of 5 retirees receives double benefit

One of the most irresponsible decisions made since the return of democracy was the free granting of 3.5 million retirements to people who had no contributions to the pension system and without any socioeconomic assessment. The challenge now is to correct the inequities and unsustainability caused by this decision. (more…)

FISCAL DEFICIT PRODUCES EXTERNAL DEFICIT

By taking external debt to finance the fiscal deficit, the incoming dollars appreciates the peso, discouraging exports and promoting imports. Therefore, to correct the big Argentinean external imbalance it is fundamental to accelerate the gradualism and balance the public finances. (more…)

REDUCTION OF PUBLIC EXPENDING BARELY COMPENSATES RISE OF INTERESTS

The economic authorities assess that the run against the dollar is unjustified since
the primary deficit is falling. However, the savings obtained just equals the increase
in interest generated by a growing public debt. This shows that gradualism adopted
is inconsistent.

(more…)

El problema no es el dólar sino la inflación

La suba del dólar genera preocupación. Sin embargo, como lo demuestra la experiencia de los países vecinos es natural y necesario que el dólar suba cuando hay alta inflación. El Banco Central no va poder tranquilizarlo, si el resto del sector público no baja más rápido el gasto público.   (more…)