After more than 200 years of studying the causes of economic growth, researches have come to understand that growth occurs when a country manages to build a framework of rules that incentivizes investment in infrastructure and human capital. Which is to say, growth doesn't come from investment for investment's sake, nor from education alone, but is the result of the combination of both, something that happens only when the rules that society has laid out foments it.This argument that economic reform must take precedent over political reform, which Luis Carlos Ugalde also referred to earlier this week, is deeply flawed. Marco-economics and politics are to a large degree inseparable. If you have deep problems in one, chances are you have (or will have in short order) deep problems in the other. In such a situation, as Mexico is today, it's hard to address one without considering the other, and it makes no sense to wait for one to improve without simultaneously considering the other.
Today they tell us we must resolve our economic and social problems, and that politics can wait. The people telling us are the priístas that came to power precisely when López Portillo was destroying the last of the national economy, and today they control the Chamber of Deputies. The people telling us are those who want to delay relevant economic changes, which is to say a serious fiscal reform, so that they can support exactly the policies that destroyed our economy: the development bank, industrial policy, and social policy as a co-opter of votes.
The cynicism of these people seems to be limitless. The tolerance of our economy, but above all our society, is not. Opening our political system lets out some rope, returning to the economy of the past takes it in. And there is no such thing as a rope that doesn't break.
Friday, February 5, 2010
The Economy First?
Macario Schettino pushes back on the idea that the political reform should wait until social and economic legislation is dealt with: