By Enrique Blasco Garma, Libertad y Progreso
There is no advanced country without a government that strengthens competition and guarantees the freedom of its individuals and companies.
The State provides satisfaction to those who control it, whether they are autocrats, powerful leaders or democratic republics. Income, securities, and public services are given according to the preferences of those who dominate the State. Such orientations explain the gaps in opinions and achievements.
In federal countries, each province and municipality attends residents differently. Hence, the gaps between the jurisdictions that lead some to envy the “opulence” of the city of Buenos Aires. Republican democracies are characterized by empowering the population and controlling the state. Interventionist officials, on the other hand, deify their own regulations. And those who suffer them rant.
The decisive technology that determines the fate of all societies is Justice. The greatest efficiency consists in having rules and laws that are stable and equal for all. Like all human organizations, nations progress by providing better valued services and opportunities. Proof of this is that 10% of humans live in countries that generate half of the world’s GDP, which enjoy less corruption and greater freedoms.
The Cato Institute’s Human Freedoms Index, HFI, measures 82 indicators of personal and economic freedoms in the areas of: Rule of Law; Security; Freedom to transit; Freedom of Religion; Freedom of Association, Strength of Civil Society; Freedom of Expression and Information; Size of Government; Property Rights; Stability of Currency; Trade; and Regulations. It covers 165 countries that make up 98% of the world’s population.
83% of humans live in jurisdictions in which freedom has been reduced since 2008, while the remaining 17% do so in countries where freedoms have advanced. Further confirming the relationship of freedoms with progress and income, 14.6% of the population resides in the top 25% of the highest HFI index, in contrast to 40.3% who are located at the opposite extreme. This relationship is also verified in the case of the level of GDP per inhabitant and in the close link with the strength of democracy.
The HFI ranking is headed by Switzerland, New Zealand, Denmark, Estonia, Ireland, Canada, Finland, Australia and Sweden. Other countries rank lower: UK 14, Germany, Japan, USA 15, Taiwan 19, Chile 28, Hong Kong 30, Korea 31, France 34, Argentina 74, South Africa 77, Brazil 78, Mexico 93, India 119 , Nigeria 123, Russia 126, Turkey 139. At the bottom, of the table we find China 150, Saudi Arabia 155, Iran 160, Venezuela 164, and Syria 165.
Personal concessions vs. competencies
The Argentine State hinders freedoms and lacks justice, efficiency or competitiveness. Replicating the feudal regimes of yesteryear, governments grant privileges to companies and individuals for unlimited amounts and time. Regulatory preferences, taxes, monopolies, special statutes, labor conditions, traps, prohibitions and other administrative biases make Argentina a field of competition to achieve particular advantages. It is the Land of Accommodation. If soccer matches were played at the AFA office, instead of on the pitch, who would go to the stadium?
The piqueteros’ business is to call for demonstrations in public spaces, complicating traffic, and extort money from the government by demanding more income. The Executive Branch gives in, increasingly financing the favored piqueteros through social plans administered by certain leaders of the so-called “social organizations”.
A condition for benefitting is to adhere to the organization and attend the marches as ordered by the leaders. Obviously, such programs have no connection with production. On the contrary, they subsidize those who hinder circulation. Granting fixed income unrelated to production impoverishes the people as a whole.
Welfare. An average couple can earn an income above the poverty line without working. Potenciar Trabajo, which in June pays AR$22,770, can add up to AR$45,540 per month, (In April they received an additional bonus of AR$6,000 each). With an AlimentAR Card for food and 2 minor children they can add another $14,700, reaching AR$60,200. With a pension for occupational disability, 70% of the minimum wage, they would obtain AR$26,250 per month, reaching AR$86,500 per month.
Potenciar Trabajo maintains 1.27 million people. Alimentar contemplates 2.5 million. The 2022 budget contemplates 1.1 million beneficiaries of the Disability Pension. In 2003, there were only 81,539 according to Roberto Cachanosky. This shows an alarming tendency to incorporate people who become dependent on the State and devalue formal private employment, aggravating the burdens imposed on it.
In March 2022, the public sector as a whole (nation + provinces + municipalities) employed a total equivalent to 54% of formal private salaried employment. Much of the state employees enjoy minimal demands at work, the taxpayers support them at the expense of their own welfare. No wonder poverty is expanding.
Until May 2022, spending by the national government grew 89% and the financial result grew 275% compared to the first five months of 2021, exacerbating uncertainty about the financial sustainability of the programs.
The piqueteros, hidden behind the scenery of social movements that are nothing more than political movements, live off the work of the private sector.
Countries fall behind when they offer privileges to friends of those in power, uncontrolled social plans and unjustified public employment. They advance through productive activities that attend to people’s real needs, are encouraged to innovate to develop unsatisfied opportunities with stable and rational rules.
Enrique Blasco Garma is Academic Advisor at Libertad y Progreso