Sunday, July 14, 2024
Perfil

OPINION AND ANALYSIS | 02-01-2024 18:51

The revolution of liberty

Federico Sturzenegger, former president of the Central Bank and architect of President Javier Milei’s economic reforms, shares his views on the head of state’s sweeping economic deregulation package.

Juan Bautista Alberdi once claimed: “Societies which hope for their happiness to be at the hand of their governments are hoping for something that is contrary to nature. Given the nature of things, every man has the providential engagement of his own welfare and progress, because nobody can love the aggrandisement of another as his own; there is no more powerful and efficient means of making the greatness of the social body, than to leave each of its individual members in the care and full power of forging their own aggrandisement.”

This vision inspired Decree 70-23, signed on Tuesday, December 20 by President Javier Milei, as well as the bill for the Law of Bases and Starting Point for the Freedom of Argentines, sent to Congress this week.

I do not wish to delve into a discussion about the origin of the urgent decree, because I believe those suggesting it do so as a strategy to avoid arguing about the attack on their privileges in its content. I do not believe it necessary to play that game. Only the need to elude the debate can motivate the CGT Workers’ Confederation [umbrella union grouping], which negotiated without qualms with dictatorships, to march to the Supreme Court for an alleged violation of the legality of a constitutional instrument. It is like something out of a Mario Vargas Llosa novel.

According to the Constitution, the Executive Branch may issue urgent decrees in emergency conditions, as long as they exclude tax, criminal, electoral or political party matters. Is there an emergency? If our current situation does not qualify as an emergency, what would? Are  tax, criminal, electoral or political party matters included? No. Case closed. Now the urgent decree is following the institutional path that Kirchnerism made very favourable to the maintenance of urgent decrees. These are the rules we gave our democracy.

Throughout my work of a year and a half on the bill to review laws for Patricia Bullrich, I had the pleasure to have the cooperation of Ricardo Ramírez Calvo, who helped me understand how to interpret the Constitution. Ricardo is a defender of textualism, which holds that texts say what they say and we must abide by their words, without adding personal interpretations. Because they say what they say. That is it. Therefore, when I hear that the urgent decree cannot have 300 articles or deal with many topics, I ask myself: what Constitution are they reading? Because ours does not establish specific limitations or say anything about it.

With these clarifications in mind, let us move on to the relevant topic: the content of the urgent decree.

The decree was structured around three fundamental and supplementary axes: expanding individual liberties, eliminating the caste’s privileges and deregulating the economy.

Individual liberties receive an expansive wave with the amendment of Article 958 of the Civil Code, which endorses the prevalence of the will of the parties in private contracts. This involves, in fact, the elimination of the Rent Law and so many other restrictions to individual contracts which we had normalised. The Rent Law was so calamitous that the supply had disappeared, leaving many people without any housing options. Luckily, this weekend already saw a reactivation of the real-estate market, which promises a rapid return to normality. This is just one example of the positive changes brought by the emergency decree.

To weaken the privileges of the caste is crucial for two reasons. Firstly, because they cause people’s misery. For instance, that people cannot freely choose their medication, but to be subject to the ones their doctor agreed with a certain laboratory, artificially inflating the price of medication. This, in itself, abundantly justifies a reform.

Secondly, because resources in the hands of the caste are used to perpetuate the caste system. For that reason, to weaken castes financially is the way to prevent them from using the money they get from the people to sustain their exploitation. In addition to their intention to have the markets work well, both the urgent decree and the president’s bill are aimed at disassembling this power structure, thus preventing the channelling of resources to the sectors seeking to maintain their privileges at the expense of the population.

For this reason, the decree includes topics chosen to challenge these inequities which, if questioned, force us to expose the caste’s privileges. How would Grupo Clarín justify the absence of satellite Internet in the country? How would unions argue against the freedom of choice by the people of their healthcare provider? What will Aerolíneas Argentinas employees claim if it is suggested for people to fly freely within Argentina? And the owners of automobile registrations, how will they defend the lack of digital bureaucracy directly with the government? It will be interesting to see how these interests defend their privileges.

Having said that, Decree 70-23 merely represents a first step in a wider reform process which Milei has in mind. This week, it was supplemented with the submission to Congress of the Law of Bases and Starting Point for the Freedom of Argentines. The proposal includes more anti-caste and deregulation measures, with reforms in such key areas as fishing, energy and transport. It strengthens the competition defence system allowing the authorities to make sure that it is not the State itself (at any level) which hinders competition.

It discusses proposals to improve public education, an integrating secondary school exam, thus eliminating restrictions to remote education and allowing parents to privately find out how their children are doing at school in a nationwide comparison. It also opens up the possibility to charge fees for university degrees to non-resident foreigners.

The bill also disarms the colonisation of culture with which Kirchnerism crushed our cultural production for years. It defies the status quo in electoral matters, no doubt one of its most controversial chapters. And it opens the door to a major restructuring of the State.

On top of that, a bill will soon be submitted to repeal some 150 absurd or obsolete laws. They include laws imposing impossible formalities (which carry penalties if not completed). Laws regulating such unnecessary things as pigeon races (I do not mean the races themselves, which I have no opinion about, but their regulation), or making empty declamations about tides and other topics.

Because the emergency continues, the bill also calls for a period of delegated powers to finish the reform work. In fact, when listing the laws these three instruments – the urgent decree, the law for bases and the bill to repeal laws – touch on, they do not cover 40 percent of the changes identified in our bill to review laws.

Now a lively debate will start in Congress. I welcome it. And since we are quoting Alberdi, his statement is appropriate: “If we wish to be free, we have to earn it first. Liberty does not come from a sabre blow. It is birthed slowly by civilisation.”

We hope that, after this reform process, Argentina comes out freer, with fewer burdens curbing its development. Because once again, as Alberdi said: “Who makes wealth? Is wealth the work of the government? Is wealth decreed? The government has the power to hinder or help its production, but the creation of wealth is not its work.”

The objective of these initiatives is to reduce those hindrances and recover that freedom to live and produce. With that yearning, let us toast to a happy and free 2024.

In this news

Federico Sturzenegger

Federico Sturzenegger

Profesor Plenario Universidad de San Andrés y Profesor Visitante Harvard, y HEC, Paris. Ex presidente del Banco Central de la República Argentina.

Comments

More in (in spanish)