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Carlos Melconian: 'The next elections are the most important since the return of democracy


The renowned economist argue that society speaks for the ballot box and that we must put a floor to 'degradation'. And he admits: 'I spent years thinking that people vote with their pockets. Today I believe a lot in dignity. I come from a poor place.

Silvia Naishtat

06/13/2021 21:00

  • Clarí

  • Economy

Updated 06/13/2021 9:00 PM

What do you mean when you talk about Argentina as berretalandia?

-Berretalandia is a synonym for degradation.

The world has a distribution problem and Argentina too.

But Argentina has been characterized in Latin America for being a leading country in the region.

Berretalandia is the sum of a cumulative process of setbacks, to reach that degradation.

But what is perceived, from many definitions that this government makes, in terms of leveling down, that it feels comfortable in berretalandia.

That can never be done by a government.

The government has to, first, find a flat for berretalandia.


In this, the Argentine society that speaks through the ballot box has enormous importance.

-Then it will be society that finds the ground to stop falling ...

-The next midterm elections are the most important since the return to democracy in Argentina.

In economic terms, berretalandia is that neither is invested nor what is depreciated.

When there was no pandemic, I liked to go inside with my car, to make presentations.

And the state of the restrooms at the service stations was deplorable, on any of the routes.

He asked the owners why it wasn't even reinvested in the toilet seat.

And they told me ... because it doesn't pay off.

The only one that can say enough to berretalandia is society.

-What scenario do you imagine based on the electoral results?

-This government has very defined some things of an institutional nature and others of foreign policy. And Argentine society has to tell the world that we are not like this government says we are in foreign policy. The world has to know that this president gives these speeches, that the vice president has certain ideas, that the governor of the province of Buenos Aires thinks as he thinks. But here there was also a G20 in Argentina, where 20 presidents of the most important in the world came and not a bird flew. And that many Argentines, I believe that the majority, we find ourselves comfortable in that bit, that of foreign policy. What cannot happen is that the world believes that the 45 million Argentines, or a great majority, think as this government thinks and the answer is no. Then,the only way is the ballot box. I spent years thinking that people vote with their pockets. Today I believe a lot in dignity. I was born, raised and made in a poor place, but with a lot of dignity. We rejected plans and asked for work. And sweet bread and cider were also distributed and then voted. All that continues to exist. Those of us who reason like this are not surrendering. Because even the Chinese are capitalists, they are authoritarian in their form of government, but capitalists.Because even the Chinese are capitalists, they are authoritarian in their form of government, but capitalists.Because even the Chinese are capitalists, they are authoritarian in their form of government, but capitalists.

-With the pandemic, the world seems to have changed hand in hand with multimillion-dollar aid packages, taxes on the internet giants ...

-For those of us who consider ourselves pragmatists and have not entered the virulence of monetarism versus Keynesianism, of orthodox versus heterodox, we know that recessions get away with money.

If I am in a recession and I am in a pandemic and I am in quarantine and with activity levels that drop and I have to voluntarily cut off activities, it is logical that they make active policies.

But there are conditions: Do you have confidence in your government?

Yes Are the rules of the game respected?

Yes. Are contracts respected?

Yes. Do you believe in the law?

Yes. Do you trust the authorities of your central bank?

Yes. Do you have a coin?

Yes. Well, do it.

-He says it in contrast to Argentina ...

-Let's do the exercise here.

Do you have a coin?

No, many years ago.

Do you trust your authorities?


Are the rules being followed?

No. Does it have inflation?

Yes. Does it have macroeconomic stability?

No. Do you have joint from when you had this price of soybeans a decade ago?

Did you know how to save?

No. And, look, you're kidding.

Here there was a government that kept the pension funds, with the Central Bank, it couldn't take it anymore and delivered;

the other came and took debt in dollars, couldn't take it anymore and gave up;

now it takes debt in pesos and there is more inflation.

-Why can't inflation be controlled?

- Inflation in Argentina is an angel and a devil at the same time. It liquefies salaries, parity, retirees, it liquefies plans, that is the inflationary demon. But, simultaneously, the inflationary angel, liquefies public spending, generates inflation tax, liquefies public treasury debt, liquefies Central Bank debt. It is "never go away, dear inflation." So do I take the angel or the devil? The model today has that problem. If we tell this government that inflation is at 15% per year, we create a problem for it. Because it stops liquefying spending, liquefying debt. I imagine the governor or the head of the bench of deputies or the head of the chamber of deputies, saying kid stop inflation, because we have a problem on the street and the money is not enough and we cannot fill the refrigerator. And meanwhile,I imagine someone who is in a different step saying do not stop inflation, look that if you stop inflation, spending increases in real terms and we stop collecting. It's a dilemma and if you ask me how do you get it out? Not even my grandmother takes it out of there.

-And Carlos Melconian?

-The first who has to take charge is the politician.

And when I speak of the politician I speak of the ruler and a moderate opposition.

How to get out of this does not lead to the involvement of extremists. We live in a strange world, with inadequate ideological bias and macroeconomic instability.

We need statesmen.

- And the holy soybean, as he baptized the super price of the oilseed?

-The holy soybean has been key in the dollar zone.

Because until the appearance of the holy soybean, even with a super stocks, the Central Bank sold dollars to calm down.

The stocks did not give more.

And the holy soy appears, the Central ends up buying dollars, of course, with a super stocks.

In other words, the holy soy took care that this in the dollar zone does not fly through the air.

-How does the year end?

-A year must be divided between the pre-electoral and the post-electoral. My impression is that the government does not want an agreement with the Pre-electoral Fund, it will be post-electoral. The Paris Club has an additional detail, it is one notch below the Fund. The Fund is owed $ 50 billion. It is a third of the debts of the Monetary Fund. First issue, Argentina is an important client that owes you a lot. This year the gift of Special Drawing Rights (SDR) appeared. So, the Argentine said, I pay you with this and with the SDR we get the maturities of 2021. But in 2022 US $ 20,000 million will expire, of which 4,000 will expire in March. There one says, is this payable? No. It is not payable even with the holy soy. 

Source: clarin

All business articles on 2021-06-15

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