Opinion Sur
Those who plunder on a global and national scale use deception and repression ensuring their impunity. It is something inherent to the process of concentration of wealth and the most important decisions. The multiple mechanisms employed conceal the interests at stake and how punishments and privileges are distributed. A paradigmatic case that allows us to visualize the looting is how those who dominate present a fiscal deficit and address it.
There was always looting all over the world. Huge populations were subjugated by powerful minorities who extorted, repressed, and profited. This is still the case in the captured democracies of the 21st century.
Looting occurs through many and diverse mechanisms, impacting every corner of contemporary functioning. Assets and income are appropriated, and freewill is colonized to numb resistance. It is a limitless appropriating process of global scope that drags humanity towards tremendous social and environmental outcomes.
Within the broad spectrum of subjugation mechanisms, a paradigmatic case is how looters present and seek to solve a fiscal deficit.
On the surface, a fiscal deficit is presented as an abuse of expenditures by the public sector in relation to the revenues available to it. According to this perspective, the state spends more than it can or should do. It would be a kind of irresponsible mess that should be cut in such a way as to match expenditures with disposable income. In this way, the monetary issuance would decrease, which, when it reaches runaway levels, generates all kinds of ills such as inflation, high tax burden, insecurity to invest, large indebtedness, economic instability.
It is a misleading diagnosis full of errors and cover-ups.
The fundamental thing is to start by understanding why a fiscal deficit occurs, something that they do not want to make explicit. The looters have their good reasons to cover up what is happening.
It will be necessary to unmask what is the basis of public revenues and how state resources are allocated. There, we find “the crux of the matter”, that is, the causes that undermine income and expenditure.
On the revenue side, there are tremendous robberies. We point out just a few of the most serious ones.
One is the criminal drain of resources practiced by most corporations and affluent sectors through tax evasion and avoidance. They do not record or present all the profits they make. These are resources arising from tax offences punishable by law. How do they hide them? A good part of them is fleeing abroad with the complicity of financial institutions that facilitate these maneuvers. They are not petty thefts but immense amounts that cycle after cycle are remitted to headquarters, often via tax havens; a huge drain with two very serious effects. On the one hand, they significantly reduce public revenue from unpaid taxes. At the same time, this criminal drainage of resources sterilizes the ability to invest them within the country, which would have generated greater production, more jobs, and better tax collection.
Another huge robbery occurs through the regressive tax structure that prevails in almost all countries. The taxes that prevail are on consumption, which punishes the middle and popular sectors much more, because consumption is a large part of their expenditures, while it does not affect the wealth of the affluents. A meaningless situation occurs, the very rich (millionaires or billionaires) do not pay taxes commensurate with their wealth. With their ability to influence the formulation of public policies, they prevent the adoption of progressive tax rules, that is, fair taxes that tax wealth and the highest incomes proportionally.
Finally, there are, of course, other additional mechanisms that undermine the collection of public revenues, but those presented here are enough to unmask how by sterilizing the collection, a fiscal deficit is generated through revenues. One wonders how factors of such enormous magnitude are not taken into account to solve runaway fiscal deficits.
Let’s look at what happens on the public sector expenditure side. Here, too, we focus on some of the most serious factors that contribute to a fiscal deficit.
A critical factor is the interest and amortization payments of a sovereign over-indebtedness irresponsibly contracted by the same people who declare their eagerness to urgently balance the public accounts. These payments represent a very high proportion of public sector expenditures. It is very difficult to get out of the deficit without resolving this issue, which operates as an effective way of subduing the national sovereignty of the majority of countries. It is the financial capital of the creditors that unceremoniously absorbs the surplus that society as a whole generates with great effort. How can we ignore this immense drainage when we are trying to solve a fiscal deficit? There will be illegally contracted debt that should be denounced and another formally legal debt that is impossible to fulfill. The prospect of widespread defaults calls for voluntary or forced cancellations globally. It is outrageous to sustain the profit of greedy financial minorities at the expense of the poverty and destitution of the great majority.
Another factor has to do with how government spending is allocated. There are huge, unjustifiable subsidies that covertly seek to ensure high rates of profit for large corporations. These subsidies cannot be maintained. There are other justifiable subsidies when they seek to alleviate emergency situations that affect large sectors of the poor. It is worth noting that the fundamental solutions for these sectors of the popular economy should be to assist them technically and financially so that they can form productive ventures that generate jobs and decent incomes. However, in the meantime, it will be essential to meet their basic needs with subsidies.
Another factor is when the State finances public works on its own that serve sectors with the capacity to assume its cost. Even though the legal mechanism exists, the contributions for improvements, is often not implemented or only covers a fraction of the costs. This is unacceptable since it is increasing the wealth of affluent sectors instead of covering the lower middle and popular sectors.
An obvious conclusion
It is critical to unmask what is hidden from the understanding of the population. It makes no sense to address a fiscal deficit by rushing towards social and productive adjustment. Solutions need to be approached in a different way.
It will be necessary to close the criminal drain of resources, transform the tax structure so that it is firmly progressive, solve the sovereign over-indebtedness, eliminate unjustifiable subsidies, charge the contribution for improvements to sectors with the capacity to pay, finance and assist the popular economy on techniques and management, among many other measures that imply exercising national sovereignty to trace our own paths of equity and justice.
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