Let’s say this without euphemisms: Inflation is a deadly disease, But not only because it reduces the purchasing power of workers and plunges the most vulnerable into poverty, but above all because disrupts the functioning of the value system, It weakens competition and deepens underdevelopment.
In centrally planned collective economies, a ministry surveys the resources and needs of the people, to determine their official What to produce, how to do it and to whom to deliver.
In a market economy, this function is a . was made in decentralized and democratic price mechanism. Thus, when there is a shortage of a product, its price increases, encouraging producers to invest and manufacture more, while discouraging consumption and vice versa; When shortages are alleviated, prices fall so that resources used for production are devoted to something else and consumers benefit from greater abundance. However, in times of high inflation, Volatility and price spread do not allow that consumers and producers make wise decisions; For example: nobody knows if a pair of sneakers is worth 10,000, 15,000 or 20,000 pesos and this ignorance sometimes favors the dealers and other times discourages the operation.
But, furthermore, in countries that have no currency, people tend to save less and when they do, they prefer to store value in foreign currencies, doubly affecting growth. firstly because without financing there is less investment and therefore less economic growth and secondly because Increased demand for dollars for hoarding increases the real exchange rate that the economy needs to balance its external sector, which in turn leads to low real wages due to the famous inverse relationship between wages and the price of the ticket in the United States; Higher dollar, lower pay, cheaper dollar, higher pay.
due, Argentina has experienced 75 serious balance of payments crises in the past 15 years And the total domestic debt barely reaches 8% of GDP, compared to 45% in Brazil or 80% in Chile. With stablecoins, not only do we avoid the next crisis, but we generate between 37 and 72 points of economic growth due to the lack of credit for production that we do not have today.
As if all this were not enough, Inflation artificially strengthens guilds, Because with a sharp decline in the purchasing power of wages, the lives of workers depend on each joint interaction.
Finally, scientific evidence suggests that Inflation encourages corruption, Because companies that sell goods and services, or manufacture for the state, tend to raise bidding prices in search of a hedge for currency depreciation, in order to compare prices at different times for any screening officer. be difficult or between jurisdictions, while It is very easy to conceal bribes disguised as inflation bonuses.
All of these reasons should be the number one priority of the next government. beat inflation, Aarey as fast as possible.
There is no doubt that replacing the peso with the dollar will lead to convergence towards inflation in the United States, since we would be replacing a highly inflationary monetary system with more stability, but we can achieve a similar result using There is , as in fact already built in the border towns, Paraguayan guarani, Bolivian peso, Brazilian real or Chilean peso.
The best option among all these options is the real one, because Brazil is our main trading partner And, as January 1999 and the most recent episodes of the pandemic show, Our economy cannot withstand the devaluation of Brazil without a strong impact on employment levels, But also in the reserves, through the trade balance deficit. Dealing with the shock of these characteristics in a context of dollarization will further deepen our country’s slowdown.
But, in addition, there is Political reasons that push to leave the peso for real. Thirty-five years ago, when Alfonsín and Cerny were thinking about the outlines of Mercosur, they were conjecturing with a common currency for the region, and the idea took off again at the end of the government of Mauricio Macri. on the other side of the border, Both Bolsonaro and Lula have said they are in favor of exploring this possibility.
In practice, our urgency to freeze advice begins with a sort of convertibility with reality, Fix the upper limit of the exchange rate of our new currency to the Brazilians and let it float downwards, giving it a cushion that allows it to absorb one last fleeting shock. The central bank will be forced to sell all the money the public demands at the new exchange rate set as a limit, while Individuals and companies can ambiguously choose the Argentine currency, the Rias or the Dollar, to their contract.
convertibility with reality All it takes is an agreement with the Central Bank of Brazil, To provide us with enough reserves to cover deposits and the monetary base, with the advantage that it is something that can be implemented during the first days of the new government. Even these reserves can be used alternatively, as we have already done with China, which can only be activated if people collectively use the reais instead of the peso. want to exercise their right to do so, without paying the cost if convertibility works with increased demand for the local currency.
Almost instantaneous monetary stability will give the new government political capital to deal with more complex reforms, But no less essential, such as an emergency labor law for SMEs (to end the litigious industry and allow the creation of a million jobs in the first two years), a tax reform that abolished taxes on production, exports and employment. is and one state reorganization Which eliminates privileged pension plans, cancels subsidies to loss-making public companies, and wipes off the map the “expensive buy-out” mechanism, which comes with a bureaucracy of unnecessary and costly processes, as well as the power of friendly companies. power. Fill the pockets.
Any progressive choice in monetary matters would be politically suicidal, Because it will quickly consume the support of a bruised and depressed society that 2023, perhaps for the last time, will bet on a radical change. Finally, convertibility with the real could pave the way for the creation of a common currency in the South.
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