NewsWhore
08-22-2006, 06:20 PM
Economist Pavel Isa Contreras, who recently resigned as advisor to the Technical Minister of the Presidency, criticizes the government in a recent interview with Hoy newspaper. He is critical of the fact that government social policies emphasize effects and not the population's lack of capacities. He criticizes the government's dispersed efforts in programs such as Promese (low cost generic pharmaceuticals), Solidaridad (RD$1,000 monthly subsidy to parents of public school children and propane gas subsidy), Inespre (low cost produce), Loteria (lottery), Comedores Economicos (community kitchens serving low-cost food). He says when the government created the Social Cabinet, the idea was that it would serve as an umbrella for other social programs, but has ended up just in charge of the new Solidaridad program. He said that the government spends relatively little on health and education when compared to the gross domestic product. "A sick population, one that is vulnerable to illness and is unskilled, is not a population that is capable of being productive and overcoming its own poverty," he said.
Isa criticizes the government's priorities. He criticizes the subsidies on propane gas and electricity.
He is also critical of all the resources being poured into the metro. He told the interviewer that the metro is being built because the President wants it to, despite the drain on public resources now and in the future. "Now because part of the resources are used for that. And in the future because the loans being taken out now will have to be paid from the money that otherwise would be used to fund social programs and to create the skills that are needed in the long term. To fund health and education programs is to create productive capacities," he said.
Furthermore, in his opinion the exchange rate never should have been allowed to reach levels of 28, 29 or 30 to the dollar. He said that the current exchange stability has been achieved at the cost of steep indebtedness of the Central Bank. He explains this as a mega vacuum cleaner that is picking up all the money that was circulated to save the collapsing banks. He says that to do so the Central Bank had to offer very attractive interest rates.
Isa went on to say that he does not foresee changes. He explains that the government has a public debt of RD$160 billion with the people, which it will pay off in 10 to 15 years, generating a surplus, spending less than it receives and transferring these funds to the Central Bank to pay investors who have CDs. "That is our money, we are the ones who are going to pay for the collapse of the banks. Obviously this is money that could have been spent on health and education, bridges and roads. That is the tragedy - corrupt bankers in cahoots with corrupt government officials."
In his opinion, there is a need for a new fiscal reform, but it cannot be done the way these have been carried out in the past, with an emphasis on generating more revenues for the state. He says that for the reform to have legitimacy, the way the state spends has to be legitimized as well. "And the way the government is spending the money is the most illegitimate way, with lack of transparency and high levels of corruption," he stated.
In his opinion, it is necessary to emphasize a tax on wealth, and on revenues. He says there is too much emphasis on selective taxes. He advocates taxing the income of the more wealthy, even if this is done gradually. "It is scandalous that the interest revenues on bank deposits are tax-exempt," he said. "The message is terrible: "Put your money in banks and earn interest and make your buck there, and do not use it in productive activities because I will tax you. The message to the Dominican people is do not invest in productive activities, deposit it in the banks."
http://www.hoy.com.do/app/article.aspx?id=85972
More... (http://www.dr1.com/index.html#8)
Isa criticizes the government's priorities. He criticizes the subsidies on propane gas and electricity.
He is also critical of all the resources being poured into the metro. He told the interviewer that the metro is being built because the President wants it to, despite the drain on public resources now and in the future. "Now because part of the resources are used for that. And in the future because the loans being taken out now will have to be paid from the money that otherwise would be used to fund social programs and to create the skills that are needed in the long term. To fund health and education programs is to create productive capacities," he said.
Furthermore, in his opinion the exchange rate never should have been allowed to reach levels of 28, 29 or 30 to the dollar. He said that the current exchange stability has been achieved at the cost of steep indebtedness of the Central Bank. He explains this as a mega vacuum cleaner that is picking up all the money that was circulated to save the collapsing banks. He says that to do so the Central Bank had to offer very attractive interest rates.
Isa went on to say that he does not foresee changes. He explains that the government has a public debt of RD$160 billion with the people, which it will pay off in 10 to 15 years, generating a surplus, spending less than it receives and transferring these funds to the Central Bank to pay investors who have CDs. "That is our money, we are the ones who are going to pay for the collapse of the banks. Obviously this is money that could have been spent on health and education, bridges and roads. That is the tragedy - corrupt bankers in cahoots with corrupt government officials."
In his opinion, there is a need for a new fiscal reform, but it cannot be done the way these have been carried out in the past, with an emphasis on generating more revenues for the state. He says that for the reform to have legitimacy, the way the state spends has to be legitimized as well. "And the way the government is spending the money is the most illegitimate way, with lack of transparency and high levels of corruption," he stated.
In his opinion, it is necessary to emphasize a tax on wealth, and on revenues. He says there is too much emphasis on selective taxes. He advocates taxing the income of the more wealthy, even if this is done gradually. "It is scandalous that the interest revenues on bank deposits are tax-exempt," he said. "The message is terrible: "Put your money in banks and earn interest and make your buck there, and do not use it in productive activities because I will tax you. The message to the Dominican people is do not invest in productive activities, deposit it in the banks."
http://www.hoy.com.do/app/article.aspx?id=85972
More... (http://www.dr1.com/index.html#8)