Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net
On March 21, 2009, President Chávez presented to Venezuelans a package of measures to tackle the economic crisis that hit Venezuela. But after studying Chavez's plan, we have the following objections:
1) Increasing sales taxes in a recession is a mistake, because tariffs have an inhibitory effect on consumption. With the tax increase proposed by Chavez, people will consume less, intensifying the recession. What Venezuela needs are measures of economic stimulus.
2) The minimum wage increase is insufficient. Chavez will increase it by 20% but expected inflation for 2009 in Venezuela is 40%. As a result, the purchasing power of Venezuelans will decline, which will worsen the economic downturn.
3) No action is taken to reduce inflation in Venezuela. The highest in Latin America.
4) The Chavist plan does not take into account the private sector. During his speech on Saturday, the Venezuelan president did not speak about working with private companies to address crisis, nor took any decision in favor of the sector that generates more jobs in Venezuela.
5) These measures are based on the hope that OPEC cuts will return oil prices to high levels within a short time, which would solve the government's deficit. However, it is unrealistic to assume that the oil market is easily predictable and manipulable.
6) And finally, Chavez's economic policies are antidemocratic, because they were made behind closed doors. No other sector outside of the federal government was consulted. Neither universities, nor labor unions, nor employers, nor professionals, nor workers, nor common people were asked their opinion.
Related articles:
- Chavez's political agenda after February 15, 2009
No comments:
Post a Comment
Warning: Comments are fully moderated. If you use language that is vulgar or inappropriate, your comment will not be published.