Let’s say this without euphemisms: Inflation is a deadly disease, But not only because it reduces the purchasing power of workers and plunges the most vulnerable into poverty, but above all because disrupts the functioning of the value system, It weakens competition and deepens underdevelopment.
In centrally planned collective economies, a ministry surveys the resources and needs of the population, to determine their official What to produce, how to do it and to whom to deliver.
In a market economy, that function is a . was done in decentralized and democratic price mechanism. Thus, when there is a shortage of a product, its price rises, encouraging producers to invest and manufacture more, while discouraging consumption and vice versa; When shortages are eased, prices fall so that the resources used for production are devoted to something else and consumers take advantage of greater abundance. However, in periods of high inflation, Price volatility and spread do not make it possible that consumers and producers make sound decisions; For example: no one knows whether a pair of sneakers is worth 10,000, 15,000 or 20,000 pesos and this lack of knowledge sometimes favors the dealers and at other times discourages the operation.
But, moreover, in countries that do not have currency, people tend to save less and when they do, they prefer to reserve value in foreign currency, affecting growth twice. in the first place, because without funding there is less investment and, therefore, less economic growth and second, because Increased demand for dollars for hoarding raises the real exchange rate that the economy needs to balance its external sector, which in turn causes low real wages due to the famous inverse relationship between wages and the US ticket price; Higher dollar, lower wage, cheaper dollar, higher wage.
due, Argentina has had 75 serious balance of payments crises over the past 15 years And all domestic debt barely reaches 8% of GDP, as opposed to 45% in Brazil or 80% in Chile. With stablecoins, we not only avoid the next crisis, but release between 37 and 72 points of economic growth due to the lack of credit for production that we do not have today.
As if all this was not enough, Inflation artificially empowers guilds, Because with a sharp decline in the purchasing power of wages, the lives of workers depend on each joint interaction.
Finally, scientific evidence suggests that Inflation encourages corruption, Because companies that sell goods and services, or manufacture for the state, tend to raise tender prices in search of coverage for currency depreciation, so as to compare prices at different times for any controlling agent. be difficult or between jurisdictions, while It is very easy to hide bribes disguised as inflation premiums.
All these reasons should be the number one priority of the next government. beat inflation, Aarey faster than possible.
There is no doubt that replacing the peso with the dollar will result in convergence to inflation in the United States, as we would replace a highly inflationary monetary system with more stability, but we can get a similar result using There are, as in fact already builds in the border cities, Paraguayan Guarani, Bolivian Peso, Brazilian Real or Chilean Peso.
The best option out of all those options is the real one, because Brazil is our main trading partner And, as January 1999 and the most recent episodes of the pandemic show, Our economy cannot withstand the devaluation of Brazil without a strong impact on employment levels, But also in reserves, through balance of trade deficit. Facing the shock of these characteristics in the context of dollarization will further deepen the slowdown in our country.
But, in addition, there Political reasons that favor leaving the peso for real. 35 years ago, when Alfonsín and Cerny thought of Mercosur’s broad lines, they conjectured with a common currency for the region, and the idea gained strength again at the end of Mauricio Macri’s government. on the other side of the border, Both Bolsonaro and Lula have declared themselves in favor of exploring this possibility.
In practice, our urgency to freeze advice begins with a sort of convertibility with real, Setting our new currency’s exchange rate upper limit to Brazilians and letting it float downward, giving it a cushion that allows it to cushion one last fleeting shock. The central bank will be obliged to sell all the money that the public demands at the new exchange rate which is set as a limit, whereas Individuals and companies may ambiguously choose the Argentine currency, the Rias or the Dollar, to their contract.
convertibility with real It only needs an agreement with the Central Bank of Brazil, To provide us with enough reserves to cover the deposits and monetary base, with the advantage that this is something that can be implemented during the first days of the new government. Even those reserves can be used alternatively, like we already have with China, which can only be activated if people collectively use reais instead of peso. want to exercise their right to do so, without paying the cost if the convertibility works with the increased demand for the local currency.
Almost instantaneous monetary stability will give the new government political capital to deal with more complex reforms, But no less essential, such as an emergency labor law for SMEs (to end the litigation industry and allow the creation of a million jobs in the first two years), a tax reform that removed taxes from production, exports and employment. is and one state reorganization Which eliminates privileged pension plans, cancels subsidies to loss-making public companies and wipes the “expensive buyout” mechanism off the map, which is accompanied by a bureaucracy of wasteful and costly processes, as well as the power of business friends of power. Fills pockets.
Any gradual choice in monetary matters would be politically suicidal, Because it will quickly consume the support of a battered and depressed society that 2023, perhaps for the last time, will bet on radical change. Finally, convertibility with the real could pave the way for the creation of a common currency for the South.