In Ecuador, cornered neoliberalism | The moving …

He condemns her to disappear before destroying her. He's known him for a long time, but he knows that he came with her to the return to democracy. He has already beaten him once and he knows that he can do it again. In April 2005, with the rebellion of the outlaws, Lucio Gutierrez was dismissed for failing to comply with the government plan and betrayed those who voted for it. Bankers, the media, the leader of the largest political party and the people of Quito have ended the aspirations of the US Embassy to set up a new political project and deepen economic reforms. Local interests are not related to foreigners.

With President Lenín Moreno, history repeats itselfbut this time it is an alliance of all factual powers, which excludes the people. There is no conflict of interest. The adjustment measures announced by President Moreno have led the Ecuadorian society to wake up from a lethargy backed by anti-warriorism. The announcement of Tuesday, October 1 was composed of three major edges: Elimination of the fuel subsidy, reduction of labor rights and presentation of an economic project urgently in the National Assembly. The story reminds us that a month before the April act, Gutierrez had presented a similar proposal: the law of economic rationalization of the state.

Neoliberalism says that it's not moral for one person to pay what another consumes. In this way, it eliminates the deep inequality of income and wealth and despises any measure to combat it. This type of "morality" does not understand that the poor live on less than four dollars a day and that every dollar counts to meet their basic needs, most of the time unsatisfied. Subsidies are a tax burden, but they are an instrument to fight inequalities or to stop them. Eliminating it would widen the gap between rich and poor, resulting in reduced demand and economic stagnation. Simply because the resources that are no longer assigned to this item will be used to pay the debt service, reduce the taxes of the richest or, later, the immobilization of public savings.

Since May 2018, the government has not borrowed aggressively to reduce the deficit and comply with the public investment plan, but to pay the economic crisis caused by the requirements of the International Monetary Fund and for tax exemption. Debts contracted with little or no economic growth are unpayable, but they are very useful in setting up the idea of ​​a state of obesity and waste. However, its reduction not only justifies the execution of the payment of the debt, but also by mistake: "the management of public finances is identical to that of personal finances". Simple application of the double game

This is to ignore the profitability of the mobilization of national savings and economic policies that diversify the financing options. The economy is dynamic, never static. Mistakes, dogmas, lack of a rigorous diagnosis of obstacles to economic growth and interests have led to the elimination of fuel subsidies. Another economic measure is the violation of labor law. The neoliberal justification is that the economy has a very low productivity generated by the regulations that govern the employer-worker relationship. Impoverishment of labor should lead to higher levels of productivity and competitiveness by maximizing profitability. The classic proposal of subsistence wages and total reinvestment supposed profits (a hoax, if you take into account, for example, the flight of capital).

To create these excuses, private banks need to be discarded, while the role of financial institutions is to promote technological change and more value-added productive processes through credit. Bankers must only maximize their profitability, even if it runs counter to economic development. According to this principle, the draft law provided for the management and total control of private banks on monetary liquidity and financial liberalization.

However, Ecuadorian society does not tolerate the reduction of its quality of life because of the mistakes and interests of economic groups covered by science. As a result, the most historically affected population sector the indigenous people organized to protest. Do not expect compensation or gifts. Raise your voice to ban this manipulation of elites and this begins with the repeal of Decree 883. The middle and lower classes in urban areas will have to do the rest, if they do not want to end up in the mouth of the ruling class and be thrown into exclusion, in poverty.

* Economic analyst.