Welcome to this space, which we will call “A binary and inevitable decision-making Argentina that will be in the coming weeks.” They will come either by government decision or by market decision. ი Don’t expect a good script, Because lately, when decisions are made by the government, they are not very convincing, and when the market makes them, it is generally quite dizzying.

The story goes that one day two friends met in the middle of the jungle. Suddenly a tiger appeared in front of them and showed its teeth. One of the friends exclaimed:

– We are in trouble, the tiger is faster than us.

Another friend replied:

– Now this is not a problem “ex-friend”, the problem is who is faster than these two.

This is how we are in our country today, Discussing binary alternatives. Experience has taught me that when a person does not make decisions about when to make decisions and it is the circumstances or the market that makes them (generally with unintended consequences), the passage of time reinforces the negative consequences and the lack of punishment. Courage or evil in receiving them. Let’s see what happens in very specific cases.

“Experience teaches us that when a person does not take action when it should be done, the passage of time punishes this lack of courage and has negative consequences.”

1. Exchange rate

We had the best export semester with proper liquidation of currencies and although we have all sorts of restrictions on demand for dollars, it turns out that We could not increase the reserves (Which will only be accepted if more dollars flow in than it goes through). Why? Მ Just because By keeping the official dollar low, importers will be increasingly encouraged to increase their stocks; Or the accumulation of goods for sale in the local market or in the absence of it in the future.

stays Two ways that can cause serious harm: A) further depreciation of the official exchange rate in order to stop imports, given the risk of much higher inflation, or b) further restrict imports leading to shortages of supplies, including energy – six of the ten products that companies need to operate today. Without replacing local industry with labor – and thus guaranteeing a recession.

This binary decision is the result Bad practice That you did not decide something in time. We stood so slowly that the tiger had to catch up with us. Once again there is a good chance that the market will adjust.

2. High fiscal deficit

The problem with high fiscal deficits is that No one is willing to fund it. To do this, the government issues debt in pesos adjusted for inflation. For item 1, lenders are increasingly asking for more interest rates. For every 100,000 pesos borrowed, Argentina must repay 165,000 pesos in one year. In other words, the debt in pesos doubles every year and this puts additional pressure on the prices of the economy, including the price of the dollar. Argentina’s debt is listed at 25% of its value – it is the second cheapest in the world – and yet it is not, due to the timely non-fulfillment of debt and misuse of creditors during the 2020 rescheduling. A buyer appears. We stood so slowly that the tiger had to catch up with us.

Once again Increases the likelihood that the market will adjust. One thing to keep in mind is that the highest debt term of the year is concentrated in September.

3. Abolition of subsidies

The removal of indiscriminate subsidies could not be delayed, but it took us so long to make a decision that The way to do this is so dirty that it will ultimately affect the purchasing power of those who make more than $ 350,000, and almost none of the tariff arrears will be resolved. As a result of incorrect practices, the increase in tariffs does not serve to increase the investment needed to guarantee domestic supply and, moreover, to reduce subsidies and, consequently, the fiscal deficit. We stood so slowly that the tiger had to catch up with us.

4. Discuss the vaccine

We lost so much time Ideological discussions against the vaccine produced by Pfizer Lab, That the tiger caught many of us. Finally it was the most widely used vaccine. Then the ideological justification was silenced, but this wrong practice cost us a few points of GDP and, even more seriously, the lives of many Argentine families.

State and its kittens

My opinion, in this week’s column, is this The dimension of the current state of Argentina behaves like a jungle tiger showing its teeth And we, the citizens, are running in anticipation of the other being caught, already forgetting if he is our other friend.

With the discourse of giving history without regard to some, It is a great risk not for the present but for the next generation. We teach him badly. When a person gets older, there is nothing more insidious, logical, fair and convenient than to train the next generation to take a position and help us with a grateful legacy and not be angry with us for what we leave behind. .

“There is no place where citizens live well with an omnipotent state, which hinders private initiative”

Who has the right Summoning a speculator to someone who runs an asset and prefers to keep its value as a warehouse; Against the background of uncertainty arising from political and economic prosperity, and do not you call a speculator someone who lives on someone else’s money and turns to others to seek votes?

The only solution is to break your fears or problems into a series of smaller steps Invest in a new generation of education! Encourage them to understand that money is made through labor and that this work is a decent income that is sufficient for prosperity.

Progress must be measured The number of citizens who live with dignity without state aid, or according to the number of companies that are born in the community each year. It is necessary to reduce the fiscal deficit to low taxes, which today makes the productive sector unviable, which feels that it works for the state and not for its own growth.

Before paying taxes we need to teach the youngest to ask AFIP: “Tell me, how much do you own, what do I earn and why? Justify now how you spend the money of my efforts. “

Someone explain to them Why is “greed” a desire to enjoy legally earned money? But it is not greed that you want to take someone else’s money so that you do nothing to earn it.

Why do I have to pay a monthly license for a car in which I am no longer allowed to travel?

The economist, writer, and thinker Lawrence Reed explained that Art Lafer (for whom the Lafer curve was named) was not the first person to observe this. State revenues increase as taxes are reduced. Muslim scholar Ibn Khaldun (1332-1406) warned about encouraging people in a very unusual way much earlier. He said: “You should know that at the beginning of the dynasty (many years in power) taxes give a lot of income from small taxes. At the end of the dynasty, taxes generated small incomes from large taxes.

The author notes that with the aging and growth of government, the attitude of officials changes. At first, they express themselves with “kindness, respect, humility, respect for the property of others, and a reluctance to appropriate it, except in rare cases.” Taxes are low and as long as they are low, society will prosper and government revenue will increase. But, When they have been in power for many years, in order to maintain themselves they become greedy, trying to increase both the payment of the will as well as the taxes in order to be able to do so.

There is no empirical evidence that citizens live well with an omnipotent state that hinders private initiative. Simple Either the level of fiscal deficit is reduced to reduce taxes, or the tiger will catch us.