 |
|
Current group: can.legal
TURMEL: Argentina's Economic Rally Defies Forecasts, NY Times
|
|
| | From: | John Turmel | | Subject: | TURMEL: Argentina's Economic Rally Defies Forecasts, NY Times | | Date: | 17 Jan 2005 12:53:34 GMT |
|
|
 |
JCT: How do you think they're going explain the
resuscitation of Argentina's destroyed economic engine
without mentioning all the provinces switching to using
their own small-denomination provincial bonds as interest-
free currency, or the Creditos systems that enable farmers
to spend Grain Dollars with major corporations, all after
the government money system had collapsed.
The Naomi Klein and Avi Lewis movie "Take" is said to have
dealt with the Argentina crisis. Avi Lewis is the moderator
who scuttled me getting the message about LETS out to
Canadians during the "Talk me to your leader" MuchMusic
election coverage when I ran for Prime Minister of Canada in
1993. He didn't understand LETS then and I'd bet his "Take"
on Argentina missed it there too.
They have no choice but to try to cover up the real reason
for the revival, interest-free currency. So let's see how
the NY Times explains what I've been telling you has been
going on. The real revolution is in unorthodox financing of
projects, and they're going to give the credit to?
And just in time for the World Social Forum too.
>Date: Tue, 04 Jan 2005 11:39:56 -0500
>From: levy-listsonly@cox.net (David Levy)
>Subject: NY Times: Argentina's Economic Rally Defies Forecasts
To: Malachai@phreaker.net, mgj-discuss@lists.mutualaid.org
DL: thanks for posting this b/c i hadn't seen it. i think,
as far as mainstream journalists go, rohter has actually
done some independent thinking, which shows in the fact that
he quoted not just one so-called liberal economist but two.
one thing mystified me:
"...argues that the current government is acting at least
in part as the I.M.F. has always recommended. It has limited
spending and moved to increase revenues, a classic
prescription when an economy is ailing"
JCT: Yes, why don't all governments just limit spending and
increase revenues, it's all so classically easy. Har har.
DL: what the *&#! is he talking about? my understanding of
standard economic theory is that this is a _contractionary_
prescription. when he says 'classic', i don't know what he
is referring to.
JCT: There's something magical going on. Something that
violates the laws of orthodox economics, something that the
priests of the false god Mammon cannot explain.
DL: moreover, i would bet that the 'limited spending' is far
less limited than what the IMF was insisting on.
JCT: How much federal spending do you need to do once the
citizens have self-financed the necessities that the
government failed to dutifullly provide? The point was that
they were broke and the 30-some provinces self-financed
their own ways to prosperity.
Imagine having a dozen large corporations like Canadian Tire
join your community and start all issuing their own store
currency which they all start to accept from each other. Who
needs government to do anything for us when we can afford to
do it ourselves?
DL: granted, the article is limited by space constraints,
but it is useful to remember how kirchner went eyeball to
eyeball several times with the IMF in negotiations, and the
IMF blinked each time b/c the IMF needed argentina as much
as vice versa, so the story goes.
JCT: The IMF were left with a foreclosure on an empty ship
with everyone else having escaped to their own do-it-
yourself life-boats now all interconnected and supporting
each other. This was an event accomplished by all
Argentina's provinces, the federal government was a spent
entity left on the sidelines for the bankers to chase.
DL: last comment: the headline really sucks. would have
been better to say '...defies imf prescriptions'.
JCT: An Economic impossibility? Miracle?
DL: there were plenty of economists who were supporting
kirchner's moves but they were on the 'left' and were
therefore not credible... --david
JCT: "credible" is not a word that should be used alone. Not
'credible" to the loansharks, not "credible" to the
authorities, not "credible" to whom? With 30-some provincial
sources of new stable goods-backed Canadian Tire monies
funding all necessary government responsibilities that the
feds have dropped, how can any governor of the whole not
look good? Yet, it wasn't a central solution, it was a
distributive one! Least likely to be stoppable!!!! 30 major
provinces pulling together their make the sum of their parts
defy IMF prescriptions.
> From: Malachai
> Date: 2004/12/27 Mon PM 12:57:41 EST
> To: mgj-discuss@lists.mutualaid.org
> Subject: [mgj-discuss] NY Times: Argentina's Economic
> Rally Defies Forecasts
Hey everyone,
I don't know how many of you regularly read newspapers
like the New York Times. I don't, but a story on their
front page on Sunday caught my eye as I walked by a
newsstand.
JCT: So that would be the Sunday December 26 edition.
I thought all of you who didn't see it (or those who, like
me, weren't willing to dish out several dollars for a
Sunday edition of the Times) would be interested.
The article is basically about how Argentina has made a
'surprisingly' strong economic recovery over the past few
years by ignoring and going directly against the policies
mandated by the IMF.
Naturally, the NY Times seems to frame this story in terms
like most mainstream economists have no idea how this
could happen.
Of course, something like this simply isn't explainable by
those who hold the theory of free-market fanaticism, even
though they try to somehow fit this in their paradigm by
saying that Argentina is "acting at least in part as the
I.M.F. has always recommended."
One could argue that this is the only thing that's holding
them back from a full recovery... but hey, the Times didn't
call any of us for our opinions.
http://www.nytimes.com/2004/12/26/international/americas/26argent.html
December 26, 2004
Argentina's Economic Rally Defies Forecasts
*By LARRY ROHTER *
LR: BUENOS AIRES, Dec. 23 - When the Argentine economy
collapsed in December 2001, doomsday predictions abounded.
Unless it adopted orthodox economic policies and quickly
cut a deal with its foreign creditors, hyperinflation
would surely follow, the peso would become worthless,
investment and foreign reserves would vanish and any
prospect of growth would be strangled.
But three years after Argentina declared a record debt
default of more than $100 billion, the largest in history,
the apocalypse has not arrived. Instead, the economy has
grown by 8 percent for two consecutive years, exports
have zoomed, the currency is stable, investors are
gradually returning and unemployment has eased from record
highs - all without a debt settlement or the standard
measures required by the International Monetary Fund for
its approval.
Argentina's recovery has been undeniable, and it has been
achieved at least in part by ignoring and even defying
economic and political orthodoxy. Rather than moving to
immediately satisfy bondholders, private banks and the
I.M.F., as other developing countries have done in less
severe crises,
JCT: Notice how he does not explain how that is done. So you
can bet it's something horrible. The words are in an
economic code that means "rather than slash the government's
budget for the poor to pay the interest for the rich as
other countries are now doing in similar situations..."
LR: the Peronist-led government chose to stimulate internal
consumption first and told creditors to get in line with
everyone else.
JCT: Why doesn't everyone just tell the creditors to wait in
line like they did? Most people are drowning and have no
choice. People on a larger and larger growing life-boat have
such a choice of leaving the ship. Nations without LETS
life-boats (Australia Bulletin Jan 9 1990) have no
resistance to being tied up and enslaved by their orthodox
financial threads, chains. Nations with independent LETS
lifeboats can resist by using their own unorthodox financial
threads instead of the interest-bearing never-ending-debt
ones.
And with the adoption of the Time Standard of Money uniting
all such disparate time-trading financial mechanisms, it
becomes a supra-national UNILETS without even needing the UN
to get it organized. That's why he could tell creditors to
screw off, their life-boat of provincial currencies was
working up fine.
LR: "This is a remarkable historical event, one that
challenges 25 years of failed policies," said Mark
Weisbrot, an economist at the Center for Economic and
Policy Research, a liberal research group in Washington.
JCT: Same thing happened when the Argentinian States issued
their own local provincial bond currencies in the mid-1980s.
More money in circulation meant inflation Shift B went from
1000% to 36% a year confounding World Bank predictions. How
they were persuaded to give up those provincial currencies
will be one of the more interesting stories once the money
war is over.
LR: "While other countries are just limping along, Argentina
is experiencing very healthy growth with no sign that it
is unsustainable,
JCT: So what they're doing has been taught to be
unsustainable yet shows no sign of being as predicted! It's
an economic miracle! The Miracle Equation rules. Zero-
Interest loans is the optimum way to finance life. Interest-
bearing loans is the optimum way to finance death and
slavery.
Having lost all their money, they've managed to make their
economy fly without any new loans! Right? Isn't that what
that means. Rather use foreign interest-bearing loans they
probably couldn't even get, they used something else.
Something that did magic. Will they identify it?
LR: The consequences of that decision can be seen in
government statistics and in stores, where consumers once
again were spending robustly before Christmas. More than
two million jobs have been created since the depths of the
crisis early in 2002, and according to official figures,
inflation-adjusted income has also bounced back, returning
almost to the level of the late 1990's.
JCT: Remember that with almost no internal debt, With always
enough currency to finance any worthwhile project for which
remain available people, no wonder they've bounced back.
With no money. How'd they do that? With no foreign capital
inflows. How'd they do that?
LR: That is when the crisis emerged, as Argentina sought to
tighten its belt according to I.M.F. prescriptions, only to
collapse into the worst depression in its history, which
also set off a political crisis.
Some of the new jobs are from a low-paying government
make-work program, but nearly half are in the private
sector.
JCT: Gee, where'd the private sector come up with money if
there was no new foreign capital inflows and all the old
money had out-flowed, the original problem? Without any
inflows, what had to substitute to do the job? Will the
Times mention the only possible answer?
LR: As a result, unemployment has declined from more
than 20 percent to about 13 percent, and the number of
Argentines living below the poverty line has fallen by
nearly 10 points from the record high of 53.4 percent
early in 2002.
JCT: Don't forget "unemployed" can mean doing things in the
large underground economy. Which would explain why
everyone's eating and in little debt but there's still 40%
of the people not employed for federal cash.
LR: "Things are by no means back to normal, but we've got
the feeling we're back on the right track," said Mario
Alberto Ortiz, a refrigeration repairman. "For the first
time since things fell apart, I can actually afford to spend
a little money."
JCT: What money? If there were no inflows after there had
been such a great outflow, where did the money come that he
feels flush enough to spend? Will they identify the source
or just leave it a miracle still in need of explaining by
the school of economic witch doctors. My apologies to witch
doctors.
LR: Traditional free-market economists remain skeptical of
the government's approach.
JCT: The government's approach to finding all sorts of new
monies bubbling around them?
LR: While acknowledging there has been a recovery, they
attribute it mainly to external factors rather than the
policies of President Nistor Kirchner, who has been in
office since May 2003. Increasingly, they also maintain that
the comeback is beginning to lose steam.
JCT: Such a major "defies prescription" event attributed to
central "policies" of Kirchner? How precise can they get?
LR: "We've been lucky," said Juan Luis Bour, chief economist
at the Latin American Foundation for Economic Research
here. "We've had high prices for commodities and low
interest rates. But if we want to grow in 2005, we're
going to have to settle the debt question and have foreign
capital come in."
JCT: He thinks the country needs to borrow foreign currency
and give up creating and borrowing its own interest-free. Of
course, he's an economist promoting the debt economy.
LR: The I.M.F., which Argentine officials blame for inducing
the crisis in the first place, argues that the current
government is acting at least in part as the I.M.F. has
always recommended. It has limited spending and moved to
increase revenues, a classic prescription when an economy
is ailing, and has built up a surplus twice the size of
what the fund had asked before negotiations were put on
hold several months ago.
JCT: After major outflows, and no inflows, they've doubled
their surplus in months. What a miracle. Still no
explanation of how it's done other than "Kirchner's
policies."
LR: "The return to these encouraging numbers has been helped
a lot by a fiscal discipline that is almost unprecedented by
Argentine standards," said John Dodsworth, the senior I.M.F.
representative here. "We've had a primary surplus which has
increased steadily over these past few years at both the
central and provincial levels, and that has been the main
anchor on the economic side."
JCT: Usually, when the Feds are profiting, it's at the
expense of the Provs. In Canada, it's eternal wrangling
between the Feds and the Provs over sharing the budget.
Argentina, with no inflows after major outflows, has the
Feds and the Provs showing surpluses. How did they do it? I
wonder if the New York Times will tell?
LR: But some of that record budget surplus has come from a
pair of levies on exports and financial transactions that
orthodox economists at the I.M.F. and elsewhere want to
see repealed. About a third of government revenues are
now raised by those taxes, which have surged.
JCT: With a booming economy, taxes can generate surpluses.
Especially when no one's paying any interest to use foreign
capital inflows. What made the levies is important, how that
they used levies like everyone else.
LR: "The I.M.F. wants these taxes to be eliminated, but on
the other hand they also want Argentina to improve its offer
to creditors and also pay back the fund so it can reduce its
own exposure here," said Alan Cibils, an Argentine economist
associated with the independent Interdisciplinary Center for
the Study of Public Policy here. "In other words, they are
saying, 'You have to pay out more and take in less,' which
is a sure prescription for another crisis."
JCT: Money. Pay out more money and take in less money. It's
all bafflegab. It's all the International Bankers chasing
the Argentinian Feds in the old Government Debt Service to
private banks scam. It's not them chasing the provinces who
have no such foreign debt and have plenty of local currency
to meet the local need of a newly-unindebted populace.
LR: Because of the absence of a debt accord and a stalemate
over utility tariffs, some investors, mainly European,
continue to shun Argentina, citing what they call the lack
of "judicial security."
JCT: Being shunned by these investors seems not to have
slowed them down. They sure don't seem worried about being
shunned by these investors. Maybe it's not such the big deal
when you have your own local investment machine as nations
who do not have their own local investment machines.
LR: But others, mainly Latin Americans used to operating in
unstable environments or themselves survivors of similar
crises, have increased their presence here amid expanding
opportunities.
JCT: No money but expanding opportunities. That's
impossible. That's a miracle. How do they do it? Will the
Times tell?
LR: "These are slogans that people repeat without thinking,
as if they were parrots," Roberto Lavagna, the minister of
the economy, said when asked about the predictions that
investment would disappear. "In 2001 and the beginning of
2002, all kinds of contracts were destroyed," he said. "So
why are they investing? Because today clearly they can get
a very good rate of return."
JCT: But the issue is still: with so little foreign inflows
after such major outflows, how did they do it all with no
bank-acceptable money? Will the Times tell?
LR: The Brazilian oil company Petrobras bought a stake in a
leading energy company. Another Brazilian company, AmBev,
has acquired a large interest in Quilmes, Argentina's
leading beer brand, and a Mexican company has bought up
control of a leading bread and cake maker.
JCT: That sure generated a lot of new economic growth...
LR: Asian countries, with China and South Korea in the lead,
have begun to move in.
JCT: Are they taking provincial government bond money too?
Or just farmers IOUs for grain?
LR: During a state visit last month, the Chinese president,
Hu Jintao, announced that his country plans to invest $20
billion in Argentina over the next decade.
JCT: Only if the Argentinians don't find a way of self-
financing it first.
LR: But the bulk of the new investment comes from Argentines
who are beginning to spend their money at home, either
bringing their savings back from abroad or from under
their mattresses.
JCT: Three years ago, everyone was broke. There were no
foreign inflows, where did all this new good money come from
to finance this remarkable recovery? Will the Times tell?
Will the times find out find out? Will the Times guess?
LR: For the first time in three years, more money is coming
into the country than is leaving it.
JCT: Money, not goods. It means that for the first time in
three years, more goods are going out than coming in.
LR: That has given Mr. Kirchner the luxury of taking a hard
line with the monetary fund and with foreign creditors
clamoring for repayment.
JCT: No one cares about the Fed's debt. Let it declare
bankruptcy on the previous military junta's debt. It wasn't
the people who spent it on goodies, it was the junta who
spent it on chains. So why worry about the Fed's debt for
your past chains when the Province is operating
independently without any need of it?
LR: "The thing is that Argentina has a current account
surplus, so they don't really need so much foreign
investment," said Claudio Loser, an Argentine economist
and the former Western Hemisphere director for the I.M.F.
JCT: That's right. Almost nobody's in personal debt, almost
nobody needs foreign exchange, it's easy to now get with the
value of the local currency being established. So are people
who don't really need so much foreign investment really
going to worry about being shunned by the investors? Har har
har har.
LR: "Domestic investment is taking place because there are
opportunities in agriculture, oil and gas."
JCT: Where does the domestic investment come from? Where was
it four years ago when everyone was broke? That's the
miracle. That's the revolution. Where'd the money come from?
LR: Just this week, the government announced that reserves
of foreign currency have climbed back to $19.5 billion,
their highest level since the crash and more than double the
low recorded in the middle of 2002, a year with a net
outflow of $12.7 billion.
JCT: These are earnings made with international sales of
provincial production for national levies. They're riding
the interest-free currency boom. What other explanation has
the Times offered?
LR: "The peak of investment in the 1990's was 19.9 percent"
of gross domestic product annually "and today it is at 19.1
percent, having risen from a low of 10 percent," Mr. Lavagna
said. The Kirchner administration continues to seek an
accord on the $167 billion in debt that is still
outstanding, and plans to make what it calls its final offer
early next month.
JCT: Great results of a miracle policy.
LR: But the turnabout here has inspired such a sense of
confidence that the government is not only talking about
cutting its last ties to the I.M.F. but also insisting that
any payback to bondholders be linked to Argentina's
continued good economic health.
JCT: An economic miracle but without explanation.
LR: "It's very simple," Mr. Lavagna said. "Nobody can
collect from a country that is not growing."
JCT: Tell that to the IMF as the bleed most third world
countries to death.
So, it's a miracle going on but there's no explanation.
Kirchner's policies did it. But what was different about
Kirchner's policies from everyone else's policies to solve
the problem of no money inflows after major money outflows.
The world wants to know. And the New York Times didn't find
out. The Times didn't dig up the answer. The Times didn't do
a very good job.
Unless hiding the real reason for Argentina's great success
was necessary due to Argentina's more and more obvious
success using the magical "Kirchner Policies" to defy
orthodox economic prescriptions.
Let's hope the participants at the World Social Forum note
that the Argentine Miracle can be turned into a World
Miracle if they agree that the WSF should organize and
operate a world UNILETS until the UN takes over for us.
--
Abolitionist Slave Leader John C."The Banking Systems Engineer" Turmel
for UNILETS interest-free time-based currency in U.N. resolution C6
to Governments in the http://www.un.org/millennium/declaration.htm
http://www.cyberclass.net/turmel 519-753-0645 USENET: can.politics
|
|
|
| | |
|
 |