The application of rescue plans is a political issue as much as it is an economic one.
Portugal has just elected a new Parliament. A majority Government has been formed with an alliance of two parties, providing a stable support for 4 years. More importantly, the three main parties all have declared, during the recent electoral campaign, the support to the Memorandum of Understanding with EC/ECB/IMF. The other parties have clearly advocated a different course of action, and have overall lost votes. It is fair to say that most of the population supports the MoU. The impact of it may be feared by many, but this was the road chosen by the majority of the population.
As the new Government is from the right-wing of the political spectrum, it is expectable that left-wing unions and parties will try to create civil unrest, which most likely will produce news outside Portugal. Still, and at the risk of repeating it, this will come from a minority.
Hopefully, outsiders will see through what may be news in the international media.
In this respect, Portugal and Greece populations are, apparently, behaving very differently (at least for the time being).
Greece is under some civil unrest, according to the news in the international media, which may actually provide a wrong picture, it would be nice to have a reference blog on the greek economy that gives a clear view on this, any suggestion from our readers and friends from Greece?
Anyway, the MoU demands that politics meets economics, and both must meet the international media, I hope that an accurate picture of the country can be given.
Without a plan to grow the economy to reduce the current deficit and reduce unemployment the new Portuguese government will lose in the streets.
ReplyDeleteAnd how grow the economy if there are no credit and the ressources would be expropriated by the government, for taxes?
ReplyDeleteFirst of all, I believe that education about maths must be interdit... Stupidity is a souce of hapiness.
In my opinion, this is the moment for significant structural changes because we cannot get much worse (e.g. interest rates on Portuguese 3-year bonds are at 15%, U% at 13%). You do not have to be right or left wing to realize this - common sense is enough. The main change needs to come from the Justice system. For a long time in our country, white collar crime (the one associated with higher monetary values, nepotism, or obnoxious sexual behavior) is, in most cases, punished with no actual jail time and expropriation of only declared assets (never mind those in tax paradises). Hence, Portugal is a country where it is actually rational for the economic agent to engage in criminal white collar activities.
ReplyDeleteIf there are no significant reforms now, then when? For example, the CEJ scandal. The government changed the director but the criminals still there (the future judges that copied in the exam)... A country without Justice cannot have democracy nor a robust economy. Delaying the so much needed reform in the justice system, is prolonging the coma that the country is currently living.
I wrote my previous post, went to check my usual news sources, and I am back. The Comissão Nacional de Protecção de Dados (CNPD)- basically those that manage the government database in Portugal - has decided, that from now on (btw, a new government is in charge since yesterday) not to disclose the name (and amounts) of those politicians that receive pensions from the government. Not surprisingly, this decision has been taken after a series of scandals involving several Portuguese personalities that where accumulating pensions illegally... it is just embarrassing to live in such country where white collar and political crime go unpunished. I have a feeling that a social unrest, similar to the Greek, might after all hit our streets sooner than later. Either that or the mentally sane will emigrate and then there is just the poor and dumb left to tax.
ReplyDeleteIn conclusion, more than economic policies, Portugal needs JUSTICE. Without it there are no economic policies that will work, nor bailouts (the use will be similar to that given to the EU structural funds). What I find surprising is that I have not been able to identify a significant number of Portuguese academics supporting this idea. So, Professors, please let me know what am I missing in the picture?
For those that want to track most of the sensitive files in the Portuguese society, check the blog Tretas - A "wiki" aimed at gathering info published by the main stream media in Portugal concerning the practice of good governance. Use google translate if you do not speak English.
ReplyDeletewww.tretas.org
typo in previous post: last word should read "Portuguese" instead of "English"
ReplyDeleteArtigo sobre salarios de politicos publicado pelo Nuno em Maio de 2009 - http://www.sedes.pt/blog/?p=1012
ReplyDelete