Reflexes first world foreign investors before diagnosis: "populism"
Consultants and analysts in general, did not hesitate to catalog Latin American Governments post-Washington consensus as "populist". In these areas, "populism" is more than a word for a social description, is a true code involving the open political and economic general hostility to capitalism in all its forms.
When this code is activated, identical way as red alerts or oranges that spread of epidemics in the degree of unsafe for travellers; or health risks are designated in the economy implies that it should raise the alert for the protection of interests in the region, adopt a political fight spirit to reject possible attacks and, most importantly, the freeze on investments until the investment conditions back to "normal" and ensure the restoration of the variables that make these criticized economies, sought by the vulture funds and quick return of developed countries.
Assumption of Néstor Kirchner and their first after output settings of Lavagna economics, made him undisputed worthy of "populist" pattern, we must confess, also adhere at that time. So we witnessed and even encourage raising the level of alert economic and meekly accept pale inaction extremely cautious foreign investors and his pompous deployment of incredible checking and re-cheking methods. History has given us the ability to view the back-office of the ordered "first world". That caution, that order and that clarity in contractual as almost everything in the universe, taken to the extreme, becomes useless patterns. The “masters” of the world economy, continued giving master classes while in their parent homes up to its own employees were fired without notice.
In August 2008, collapsed as flies the colossi idealized world financial market, the cathedrals of investment are coalesced and who until yesterday seated in their directories developed Governments, today called phones down begging mercy, aid or subsidies, in the most decent finals, accepting the State as new and acclaimed partner. In fact, economic history just added a recurring, chapter ultimately the ineffable and indisputable role of the State in economics, nothing surpassed this crisis without an open, deep and inclement State intervention not only in macroeconomics, but even in the composition of private capital.
Meanwhile here in the South, unemployment, not lowered, but rose in fact nor the rate of dismissals of international corporations, has been in Latin America much lower than in the first world parent houses. The subsidized economy remained stable, Argentina middle class - dominant historically of segmentation of the market-years without major upheavals, employees tied their collective agreements annually to inflation that without mentioning certain structural changes, whose dismiss made that they did not result of policies of State, but achieved its goal and is all important, as the change of members of the Supreme Court, the law means, mobility retirement law, the amount of constant pubic investment, prosecutions of the truth, etc.
Our Constitution establishes a concept that very few economists know that it belongs to his science from its preamble: "promoting the general welfare". The reality is that economy overall well-being should be measured in the real possibility of access to economic assets from the population and, paradoxically, the Government called populist, has achieved despite his heterodoxy that primary obligation.
Perhaps is time for foreign investors, to clean up their boats after the storm and relocated to populist governments in another sector. Indeed, despite the crisis are the economies that better manage and react and, as data key of naivety, people with well-being, is happy and consumes more clearly; these consequences not can become a bad investment scenario therefore diagnosis is correct, but populism perhaps is not so a lethal disease for capital.
Benevento & Associates
Economic investigations, December 2009.
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