Elena Landau: Until further evidence, all privatize – Economy



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Even with a high rejection rate and no political legitimacy since the JBS imbroglio, the Temer government ends with many advances in the economic field, thanks to the work of the Treasury, Planning teams and the Central Bank. Achievements are even more commendable in the face of the ongoing boycott of the legislature and judiciary. Our members of Congress, our ministers, our judges and our prosecutors seem to live in a parallel reality.

To combat the patrimonialism and irresponsibility of the companies represented by these powers, there is only one way out: significantly reducing the state.

To deepen what this government has done will be the challenge of the new team. And the challenge is very big. Only the federal government still has 134 state-owned companies. The most important sectors are oil, electricity and finance. The first two represent almost half of the total.

In the financial system, there are 25 other institutions. In addition to these, some are worth practically nothing, such as Ceitec and Valec, whose most likely destination is liquidation, and exceptional cases, such as Embrapa, a research company that must remain in the hands of the company. 39; State.

The Secretariat for Coordination and Governance of State Enterprises (SEST) estimates that, overall, companies have a heritage of just over 500 billion rand. The added value of publicly traded state companies revolves around this same figure and the share of the Union in the capital is much smaller. Far from trillions announced in the countryside. Even though the most valuable state companies – Petrobrás, Eletrobrás, Banco do Brasil and Caixa – are considered strategic by the future president.

For these companies, it is likely that only those badets that are not part of their core business will be sold and the proceeds of that sale must be paid into the corporate fund.

The resources to be obtained are far from the solution to the fiscal crisis. The breakdown forecast in the federal government accounts for this year is about 150 billion rubles, but the main problem is the growth trajectory of public spending. Therefore, the most urgent is to solve the social security deficit, which is growing at a rate of 50 billion rubles per year in the current model. Nevertheless, it is very important to privatize to increase competition, efficiency and productivity of our economy.

In public debate, it is common to hear the thesis that a profitable business should not be privatized. This idea is wrong. Even isolated cases of professional management in state-owned companies show that good governance does not stand up to the dynamics of the political game of power. In addition, the efficiency of resource allocation does not only concern positive balance sheet data, but also opportunity costs. There is no free meal.

Our heritage tradition, so heavily exposed to the scandals of the Lava Jato operation, shows that Brazilian state companies constitute the badets of a group of interests and the politicians who them use, thus absorbing resources that should constitute civil society: schools of quality, sanitation and security.

Since the 1990s, the procedure for selecting companies to privatize is the same: on the proposal of the National Privatization Council (now the PPI Council), presidential decrees decide on a case-by-case basis to include companies or sectors. . This is the general rule. There are few cases requiring congressional authorization because there is a specific law prohibiting the sale of control. They are: Bank of Brazil, Caixa, Petrobrás and Eletrobrás.

It would be important to change the traditional procedure because, for each company to privatize, whatever its size or importance, the political battle is arduous. The debate eventually turns around the question: do you really need to privatize this business?

It's a bad approach. Most state-owned enterprises were created by anachronistic laws prior to the 1988 Constitution. Their creation followed the logic of the military regime, based on a protectionist and nationalist model. Model that did not work.

Criticism of the Constitution is frequent, but it is necessary to revise it. There are relevant principles, such as Article 173. The presence of the State in the economy is very clear: "Except in the cases provided for by this Constitution, economic activity by the 'State are allowed only where necessary to the requirements of national security or the collective interest concerned, as defined by law. "In other words, the presence of the state in the economy is a exception and not the rule, because many want to believe in this country dependent on the state.

A careful reading of this constitutional provision reveals that the burden of proof must be reversed. This is not the need for privatization that needs to be proven by the government, but the need to nationalize or maintain a state-owned enterprise. Nor is there any reference to strategic sectors – a purely ideological discourse.

Regardless of the ideological difficulties already expressed by the future president, the Ministry of Finance should put in place the new national privatization program, in accordance with the mandate of the Constitution, and encompbading all public enterprises.

The question that must be answered now is: do you really need to maintain your state status? If the answer is yes, a new authorization law must be promulgated, indicating exactly what are the collective interests defended, so that society can follow and impose transparency on society.

Therefore, the logic should be the following: until proven otherwise, privatize everything.

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