Monday, April 30, 2007

Irrational Complacency?

By BURTON G. MALKIELApril 30, 2007

Despite news that the estimated first quarter GDP growth rate fell to 1.3%, the Dow Jones Industrial Average closed last Friday at 13,121, a record high. The broader capitalization-weighted S&P 500 stock index, covering 80% of the market, traded just below its historical high. Only the Nasdaq index is well below its Internet bubble high. Is the stock market correctly pricing strong growth in corporate profits and present economic stability? Or are we being irrationally complacent in the face of substantial risks to the market and the world economy?
Despairing of economists who offered "on the one hand, on the other hand" advice, President Harry S. Truman yearned for a one-handed economist who could offer clear predictions about the future. I fail Truman's test; neither I nor anyone else knows the proper level of securities prices, and we can never be sure if today's stock prices are reasonable measures of uncertain future events. We can, however, evenhandedly assess current valuations in financial markets and the prospects for likely future long-run returns.
The facts are that stock prices are high not only in the U.S. but also in the world's developed and emerging markets. We can estimate long-run annual equity returns by adding today's dividend yield (just under 2%) to the likely future growth rate of earnings and dividends (perhaps 5.5%). This calculation suggests that stocks are priced to produce about 7.5% future returns, well below the 10.5% annual returns achieved from 1926 through 2006. Treasury bond yields (at just under 4.75%) are historically low, as is core inflation, running close to 2%. The prospective equity risk premium (the amount by which stock returns are likely to exceed bond returns) of about two and three-quarter percentage points appears to be well below the five percentage point equity risk premium earned since 1926. We are not being paid as much to take on the risk of holding stocks.
Not only are equity premiums low; so are bond risk premiums. The spread between high-yield bonds (more pejoratively called junk bonds) and safe U.S. Treasuries is just about at an all-time low. Sovereign emerging-market debt yields are not much more than two percentage points over U.S. government debt. The VIX index, measuring expected U.S. stock market volatility, is extraordinarily low. These measures imply that financial markets are very relaxed about risk and that the world is a very stable place.
There are reasons to argue that world economic stability has in fact increased. We have not endured a world war in over 60 years. The Cold War ended peacefully, and increased trade has made the world's economies increasingly interdependent. Free market economies have blossomed throughout the world. As money manager Rex Sinquefield reminds us, the only people today who don't believe that markets work are the Cubans and the North Koreans (and some "active" portfolio managers). Economic activity in the U.S. has become increasingly stable. Depressions have been avoided, recessions have been mild, earnings variability has moderated and inflation has been contained. Moreover, despite the rise in the stock market, and unlike the situation at the 2000 peak, price-earnings multiples in the mid to high teens are not far from their long-run average values.
But could the stock market be underestimating geopolitical risks today? We are all painfully aware of the extraordinarily difficult situation in the Middle East. The conflicts between Sunnis and Shiites as well as the violence of Hezbollah and Hamas threaten to destabilize the entire region. Iran poses a grave threat to Israel and seems determined to become a nuclear power. Unrest in the region has a direct impact on oil prices.
Potential problems in energy-vulnerable Europe seem more remote to most observers. But Europe has a large Muslim population that is experiencing limited social integration, high unemployment and radical Islamist influence. Beyond that, with slow-growing economic activity and rapidly aging populations, European governments will be hard put to fulfill their generous social welfare promises. Could it be, paraphrasing President Franklin D. Roosevelt, that the only thing we have to fear is lack of fear itself?
Moreover, economic imbalances in the U.S. could trip us up. According to Yale University economist Robert Shiller, inflation- and quality-adjusted home prices are still more than 50% higher than their averages throughout most of the 20th century. These data suggest that the real-estate correction could have much further to go. Measured savings rates in the U.S. are essentially zero, and the trade deficit is running at 7% of GDP.
The late economist Herbert Stein used to say, If something can't go on forever, it won't. Many observers would also argue that the U.S. income distribution may be unsustainable. The share of after-tax corporate profits (increasingly influenced by the foreign profits of multinational corporations) relative to GDP is almost 9%, compared with an average of about 5% during the 1970s and 1980s. Wages and salaries as a percent of GDP have fallen from 53% to under 46% since 1970.
Corporate profits have shown strong tendencies to revert to the mean in the past and could do so in the future. Inflation-adjusted earnings of the S&P 500 stocks showed zero growth from 1900 through 1947 and again from 1967 through 1987. If we enter such a period in the future, today's moderate price-earnings multiples may look far less attractive.
As a believer in efficient markets, I hesitate to conclude that our markets are being irrationally complacent. I believe that markets are high and risk spreads compressed because of massive increases in world liquidity. A world awash in dollar-based purchasing power has helped to keep our interest rates low and the spreads on risk assets tight. It has encouraged large flows of money into private equity funds that are privatizing (and leveraging) some of the "undervalued" companies in the market, leaving less attractive firms available for public investors. Flows of money have also continued into hedge funds where leverage is high and where "accidents" such as the Amaranth collapse are always possible. In our highly leveraged, narrow-spread markets, shocks to the system -- be they economic or geopolitical -- can have large destabilizing effects.
So what should investors do as the Dow rises to new highs? Should they "sell in May and go away," as one stock-market bromide suggests? As a student of markets for over 50 years, I am convinced that attempting to time the market is a fool's game. But new highs in the market should induce investors to review their asset allocations. If the rising stock market has pushed your allocation of equities well above the level consistent with your risk tolerances, it makes sense to consider rebalancing. Rebalancing is an excellent strategy to constrain your investment risk in a very uncertain world.
Despite the risks and potential problems I have outlined, I remain a cautious optimist. I don't think anyone will make money in the long run betting against the inherent strength of the U.S. economy. I expect that the economy will adjust eventually to whatever imbalances exist and that the nations of the world will ultimately find peaceful solutions to the seemingly intractable problems that continue to bedevil us.
Having disclosed my optimistic bias, however, I can't help remembering the story of two rabbis at the time of the creation. One rabbi asked the other whether he was optimistic or pessimistic. "I'm optimistic," the second rabbi replied. "Then why are you frowning?" the first rabbi asked. The answer: "Because I'm not sure my optimism is justified."
Mr. Malkiel is a professor of economics at Princeton University and the author of "A Random Walk Down Wall Street," 9th ed. (W.W. Norton, 2007).

Saturday, April 21, 2007

Wednesday, April 18, 2007

Cho's Madness

April 18, 2007

The mass murder at Virginia Tech is the kind of traumatic event that unleashes a torrent of pop sociology and national psychoanalysis, so allow us to weigh in with a more fundamental explanation: There are evil and psychotic people in this world willing to do great harm to others if they aren't stopped. The dilemma in a free society is how to stop them.

Cho Seung-Hui seems to fit the profile of a social misfit who snapped. Like many other mass killers, the 23-year-old is being described by acquaintances as a "loner," given to bursts of hostility and other antisocial behavior. We will learn more in the coming days, but our guess is that those who knew him will conclude that they saw the warning signs.

The calculation of his murder spree also suggests some deeper evil at work -- if we can use that word in liberal company. Cho used chain locks to bar students from escaping, lined some up against a wall, and emptied his clips with brutal resolve. "There wasn't a shooting victim that didn't have less than three bullet wounds in them," one of the doctors on the scene told CNN. This was a malevolent soul.

How can a society that wants to maintain its own individual freedoms stop such a man? The reflexive answer in some quarters, especially overseas, is to blame any killing on America's "lax" guns laws. Reading a summary of European editorials yesterday, we couldn't help but wonder if they all got the same New York Times memo, so uniform was their cultural disdain and their demand for new gun restrictions.

Yet Virginia Tech had banned guns on campus, using a provision in Virginia law allowing universities to become exceptions to the state's concealed carry pistol permits. Virginia is also known for its strict enforcement of gun violations, having implemented a program known as Project Exile that has imposed stiffer penalties and expedited gun cases.

In any case, there is no connection between recent mass murder events and gun restrictions. As Quebec economist Pierre Lemieux noted yesterday, "Mass killings were rare when guns were easily available, while they have been increasing as guns have become more controlled." The 1996 murders in the Scottish town of Dunblane -- 17 killed -- occurred despite far more restrictive gun laws than America's.

You could more persuasively argue, as David Kopel does nearby, that the presence of more guns on campus might have stopped Cho sooner. But as a general rule we are not among those who think college students, of all people, should be advised to add guns to the books in their backpacks.

Any gun control crusade is doomed to fail anyway in a country like the U.S. with some 200 million weapons already in private hands. While New York Mayor Mike Bloomberg seems ready to stump for gun restrictions, we doubt many Democrats will join him. They did so after Columbine in 1999, only to lose the 2000 election in part because of the cultural backlash in America's rural and hunting counties. We'll concede that this political reality has changed only when New York Senators Chuck Schumer and Hillary Clinton decide once again to pick up the gun control cause.

A better response than gun control would be to restore some of the cultural taboos that once served as restraints on antisocial behavior. These columns long ago noted the collapse of such social and moral restraints in a widely debated editorial called "No Guardrails." Instead, after Columbine, there was a rush to blame violent videogames. But videogames or other larger media influences don't inspire mass murder when there are countervailing restraints and values instilled by families, teachers, coaches and pastors. Two generations ago, colleges felt an obligation to act in loco parentis. Today, the concept is considered as archaic as the Latin -- and would probably inspire a lawsuit.

However, even those benevolent influences -- were it possible to restore them -- might not have made a difference in the case of Cho Seung-Hui, whose madness can't be explained by reason.

Conspicuous Charity

April 18, 2007

You might remember the fact, reported ad nauseam in the mainstream press last year, that Vice President Dick Cheney's 2005 tax return showed he had a family income of $8.8 million. This was due in no small part from stock options from a variety of companies, including the much-vilified Halliburton Corp. This fact provoked howls of outrage from many of Mr. Cheney's critics, who claimed it was evidence of what one syndicated columnist has called an "autocratic, plutocratic regime."
Significantly less-frequently reported last year was this datum: Mr. and Mrs. Cheney gave 78% of their 2005 income to charity. That's not a typo -- the couple donated $6.9 million, including the proceeds from stock options and book royalties that Mrs. Cheney routinely gives away. Their giving went to three nonprofit causes in health, higher education and services for inner-city youth.
While the Cheneys might look like elite philanthropists, Mr. and Mrs. Bush were no charitable slouches either. Foursquare tithers, they gave away 12.2% of their adjusted gross income in 2005, and similar percentages in past years. Their giving tends to go to more middle-class causes, including their church, the American Red Cross and the Salvation Army.
How does the current administration compare with the previous one? In 1999, the Clintons gave away a solid 9.4% of their income, while the Gores gave 5.1%. Two years earlier, however, the former vice president's giving had earned some special attention. In 1997, the Gores only gave away $353 of their income of $197,729, or 0.18%. Mr. Gore's spokesman deflected criticism by pointing out that, "To truly judge a person's commitment to helping others, you need to consider what they have done with their lives and how they have spent their time -- and by that standard the Gores are extraordinarily committed." In other words, Mr. Gore's life was his charity.
Despite this defense, the revelation clearly was embarrassing to the vice president, and the next year the Gores recovered by giving away a far more respectable 6.8%. Why did Mr. Gore feel the need to defend himself when his non-giving came to light, and raise his donations the following year? Indeed, why is it that America's leaders always feel compelled to release their tax returns (which they do voluntarily) and show that they give generously? Are we a nation of scolds, ready to condemn our leaders for insufficient displays of selflessness and altruism?
There is a better explanation for why we look for our leaders to give. Recent research suggests that giving is one way that we identify qualities of leadership in others. For example, in 2006, two British researchers conducted an experiment on human subjects in which participants were given money and asked if they wanted to share it voluntarily with a larger group. Some did, and some did not.
This kind of experiment is quite common, and many economists have used it to understand our tendency to cooperate with each other. In this particular experiment, however, there was an ingenious twist: Without announcing it beforehand, the researchers followed up the cooperation exercise by asking the participants to vote for a leader. Eighty percent of the time, the person who had contributed the most to the other members of the group was elected. The biggest givers were also the most popularly-chosen partners in follow-up tasks, while selfish participants were shunned.
In other words, when Mr. Gore failed to give, Americans probably didn't see mere selfishness; we perceived a lack of leadership. Maybe he seemed slightly less presidential. There are many ways to give besides tax-deductible contributions to nonprofits, of course, and there is no doubt the Gores gave in many ways not captured on their tax return. The problem for him was that we couldn't see them.
This raises an interesting ethical problem: Isn't it somehow less than altruistic to give publicly, especially when our giving benefits us by winning the approbation of others? Perhaps. But it is worth keeping in mind that giving openly also provokes mimicry by others, and thus a public gift can multiply itself. In this way, giving abundantly and openly -- giving like a leader -- benefits everyone.

Mr. Brooks teaches at Syracuse University's Maxwell School of Public Affairs and is the author of "Who Really Cares: The Surprising Truth About Compassionate Conservatism" (Basic Books, 2006).

Mónica, César y las Causas Reales del Aumento de Precios

Mónica, César y las Causas Reales del Aumento de Precios

Por Martín Simonetta

El comercial televisivo de una cadena de hipermercados muestra a los prestigiosos periodistas Mónica Cahen D’ Anvers y César Massetti prometiendo, en un clima dramático, “el precio más bajo del mercado” a los efectos de “liderar la lucha sobre la suba de precios”.

Éste aviso, quasi culposo, parecería asumir un supuesto falso aunque popularmente aceptado: que la causa del ya no tan silencioso aumento de precios radica en el “afán de lucro desmedido” de los supermercadistas, almaceneros y productores de distintos rubros, y no de la política monetaria y el modelo económico del actual gobierno.

Paradójicamente, las estadísticas nos indican que la desmesura de estos actualmente “cruentos” empresarios era más moderada diez años atrás, por lo que la inflación en 1996 era del 0,1% mientras en el 2006 alcanzó al 9,8% , según los cuestionados datos oficiales.

Tras el tragicómico cambio de autoridades dentro del Instituto Nacional de Estadísticas y Censo (INDEC), y el consecuente “mejoramiento” de las cifras que llegan a la población, emerge la pregunta sobre cuál es la verdadera inflación. En consecuencia, cada argentino ha comenzado –de forma más o menos conciente- a generar su propio índice de inflación a partir de un dato muy simple: cuánto menos puede comprar cada mes con sus ingresos.

A efectos de estimar el aumento real de los precios, sostiene Juan Llach que debemos tener en cuenta el crecimiento de la recaudación impositiva: 33,6% considerando marzo 2007 contra marzo 2006, especialmente la del IVA, lo cual se encuentra muy por encima de la inflación declarada.

Góndolas vacías y desabastecimiento selectivo

Mientras las disqusiciones teóricas avanzan, la brecha entre la inflación formal y la percibida por la gente va dejando de ser un debate técnico y golpea con más fuerza a los sectores de menores ingresos. Para un 27% de la población, que según el INDEC es pobre o indigente, el aumento de precios significa la diferencia entre alimentar saludablemente a los hijos o simplemente hacerlo con fideos y arroz.

Por parte del gobierno, la única respuesta ha venido del lado del control de precios y de transferir la responsabilidad al sector privado, tal como Alfonsín hizo en los años previos a la gran hiper del 5000% anual en 1989.

Para controlar a los culpables, el Secretaría de Comercio, a cargo del ya popular Guillermo Moreno apuntó sus armas para controlar férreamente a los “peces gordos”, léase las cadenas de hiper y supermercados. La consecuencia natural, como en otras épocas, ha sido una nueva ola de desabastecimiento que los afecta negativamente y que ha traído nuevamente a nuestra mente, como flashbacks, las góndolas vacías de otras épocas.

Por su parte, los “peces flacos”, es decir los almacenes y carnicerías de barrio –que se hallan más dispersos y cuyos precios son más difíciles de controlar- pueden mantener y vender a precios mayores pero reales, aunque superen a los decretados oficialmente. Mientras tanto, en los últimos 12 meses la base monetaria creció nominalmente un 34%.

El hecho de que los precios suban por el ascensor y los salarios por una muy empinada escalera nos lleva a preguntar sobre el derrame de un modelo de economía cerrada a través de un tipo de cambio real alto (en comparación al 1=1) que sobrepotencia la exportación de productos primarios, lo cual es “mordido” por el gobierno a través de los elevadas retenciones que representan cerca de un 12% de los ingresos fiscales.

En síntesis, Mónica y César tal vez no puedan permanecer tranquilos pues –ceteris paribus- la tendencia incremental de los precios permanece intacta. Sin embargo, deben saber que la culpa de la actual inflación debe encontrarse en la esencia de la actual política económica y no en el comportamiento del sector privado.

Martín Simonetta
Director Ejecutivo de la Fundación Atlas1853

Fuente: Fundación Atlas 1853

Sunday, April 15, 2007

Sharp Left Turn in Ecuador

April 9, 2007

"When plunder is organized by law for the profit of those who make the law, all the plundered classes try somehow to enter -- by peaceful or revolutionary means -- into the making of laws."

--Frederic Bastiat, The Law, 1850

To understand the constitutional crisis that Ecuador finds itself in today -- and why the Organization of American States, yet again appears incapable of constructively intervening in an authoritarian power coup -- there can be no better guide than this little book, written more than 150 years ago, by a Frenchman to warn his fellow citizens of the dangers of an all-powerful state.

The modern day plunder frenzy in Ecuador pits President Rafael Correa, an outspoken admirer of Venezuelan President Hugo Chávez, against members of Congress who wish to preserve the country's institutional balance of power. At stake is the future of democracy, with 13 million Ecuadoreans facing the prospect of life under a soft dictatorship allied with the Venezuelan strongman.

The outcome of this struggle is not only of concern to Ecuadoreans. Tucked alongside of Peru and Colombia, Ecuador is perfectly situated to provide safe haven to the organized crime and rebel groups that Mr. Chávez has been known to shelter on his own border with Colombia. A non-democratic Ecuador, led by the pro-Chávez Correa, would almost certainly further diminish stability on the South American continent.

Mr. Correa was elected fair and square last year in a runoff against a banana tycoon. His victory hinged largely on his ability to tap into the popular, and correct, sentiment that the country has been plundered by a corrupt status quo. He promised that he would do some plundering of his own -- legally of course -- to get what was owed for the majority poor.

Yet Mr. Correa also had a reputation for extremism and even disenfranchised Ecuadoreans weren't ready to follow him blindly. To win in the runoff, he was forced to moderate his speech substantially. After the election was over he reverted to his former fiery self. At his inauguration in January, he pledged allegiance to "21st century socialism," waving about a "Bolivarian" sword which was a gift to him by Mr. Chávez. He also threatened to default on his country's external obligations, and more recently he stated that creating uncertainty in the debt market is part of his strategy.

So far this is mostly the stuff of standard Latin populism, laced heavily with nationalism and served up with Mr. Correa's trademark macho-man appeal. It is an economic agenda that is bound to damage investment and Ecuador's risk profile, and further impoverish its people. But under democracy, the president gets to put his program in place and see if it works. His opponents may not like it, but it is within his presidential powers.

On the other hand, his plan to rewrite the highest law of the land, crush the opposition and make himself ruler for life is not a presidential prerogative and this is what has sparked the constitutional crisis.

To get the ball rolling on the new constitution, Mr. Correa has decreed a national referendum on whether the country wants to elect a constituent assembly with "full powers." A "yes" vote would mean that the assembly would not only be charged with drafting the new law, but also be given authority to dissolve Congress, remake the courts and end term limits for the president.

Mr. Correa's opponents feel certain that he is following the road mapped by Mr. Chávez, whose power grab rested mainly on a constitutional rewrite that allowed him to destroy competing institutions designed to act as checks on his power. And since, by law, only the legislature has the power to call a constitutional referendum, Congress, in the past few weeks, tried quashing Mr. Correa's "full powers" referendum through a series of technical legal maneuvers.

Mr. Correa fought back by getting the electoral court to expel 57 of his opponents from the 100-seat unicameral legislature and enlisting the police to enforce the expulsions. Then he called in his militias. In recent days the streets of Quito have been flush with violent activists sending a message in favor of the Correa plebiscite. The president also seems to have "convinced," although no one knows how, one key judge and other political actors to side with him so that the referendum -- now scheduled for this Sunday -- is likely to go forward, despite objections from the legislature.

Having been "democratically elected" and now enjoying an approval rating of about 60%, Mr. Correa seems to believe he has carte blanche to make the law whatever he decides it is. We wonder where he got that idea if not from the OAS and other bright bulbs in Washington (like Connecticut Sen. Chris Dodd) who continually defended Mr. Chávez's right to steamroll his opponents on the grounds that he won an election.

If the OAS has any raison d'être besides taking up valuable real estate in Washington, it is to support the balance of power that makes a democracy different from a mobocracy led by a caudillo. Up to now it has offered only vague support for democrats by stating that legitimacy requires the referendum to be "carried out in a framework of absolute respect for the democratic rule of law." That hardly seems possible at this point, since the referendum is outside the law. Instead of trying to end what Bastiat called "lawful plunder" the OAS seems more concerned with respecting the revenge of the plundered classes. It's as if it doesn't know why Mr. Correa and his supporters should not be permitted to take their own turn at power and plunder.

Bastiat had the answer to that too: "Woe to the nation . . . when the mass victims of lawful plunder . . . in turn seize the power to make laws." The losers, of course, will be the majority of Ecuadoreans.

• Write to O'Grady@wsj.com1

Saturday, April 14, 2007

An Inconvenient Tree

April 14, 2007

A report that just came online in the Proceedings of the National Academy of Sciences should make warm reading for Al Gore. The former next president, like many black-clad greens gracing the cover of Vanity Fair, relies on firms that promise to plant trees to offset their clients' fuel-intensive lifestyles, allowing the affluent to ignore their effluence and claim to be CO2 free. Mr. Gore also points to windmills and other energy alternatives when pleading carbon-neutral to charges his jet-setting contributes to global warming.

But where do Mr. Gore's green woodlands grow? Canada? Scotland? Patagonia? Alaska? Siberia? Does he really know? Carbon offsets are sold by the ton, not by the acre, and don't come with return addresses.

He'd better find out -- before Earth Day. The research reported by Govindasamy Bala of Lawrence Livermore National Laboratory and colleagues at the Carnegie Institution's Department of Global Ecology compared the climate effects of planting and clearing forests at latitudes high and low. Their computer simulations yielded some disturbing results.

Saving the tropical rain forest is well and good, for cutting down trees in the tropics means less long-term water transfer from soils to the atmosphere, leading to fewer clouds and a warmer planet. But planting trees where none exist in northern areas may actually hasten global warming. Northern tree plantations can trap heat -- they both absorb solar energy and shade sun reflecting snow. This, say the scientists, can apparently overpower the cooling effects of trees soaking up carbon dioxide and storing carbon in growing biomass. Take away the trees in the long-running climate model, and high latitude areas become 0.8 degrees Celsius cooler by the year 2100, when compared to a standard model of North Woods forest density. Carbon-offset plantings there could send the tree line north, worsening global warming.

Atmospheric scientist Govindasamy Bala of Lawrence Livermore says, on the other hand, that tropical reforestation efforts could slow global warming -- low latitude regions that the model left treeless until 2100 increased in average temperature by 0.7 degrees. That's a warming trend as large as the planet saw in the 20th century.

Climate scientist Victor Brovkin of Germany's Potsdam Institute for Climate Impact Research told Science magazine, which is edited by Mr. Gore's friend Donald Kennedy (former president of Stanford University), that while the new study serves as an important warning against planting trees in the far north, planting trees in temperate regions probably has little or no net regional effect. Comparing models of reforestation and deforestation of areas in the temperate zone shows temperatures shifting just 0.04 degrees Celsius -- an impact even smaller than the predicted .07 degree effect of the Kyoto treaty. So Mr. Gore can't very well wag a finger at that hatchet-wielding Arbor Day delinquent, George Washington, for chopping the Little Ice Age down in its prime, or snip at the energetic brush cutting of Presidents Bush and Reagan.

The inconvenient truth -- that ill-placed "carbon offset" reforestation schemes can backfire could give rise to a legal climate of fear. Will environmental lawyers chasing tree surgeons' ambulances become the next big thing in torts? The climate modeling game affords few certainties, but it seems likely that carbon-offset lawsuits will sprout like kudzu from this fertile new research field. As it grows, will the green state attorney generals who took the EPA to the Supreme Court end up inviting the former next president back for an encore?

Mr. Seitz, a physicist, used to own 25 acres of Christmas trees in Maine. He lives in Cambridge, Mass., and blogs at Adamant.typepad.com1.

Monday, April 09, 2007

Hasta hubo deflación en turismo

Hasta hubo deflación en turismo
Por: Juan Luis Bour

Ámbito Financiero

Los métodos autoritarios nunca fueron un buen sustituto de los mecanismos que propone una sociedad abierta y democrática, pero parece que no todos comparten esta opinión. El manejo de los precios por parte de las autoridades es un claro ejemplo de querer reemplazar el funcionamiento de los mercados por un sistema policial y de falsificación sistemática de los datos. El parte de INDEC sobre la inflación de marzo es un ejemplo al respecto.

Hay varias cuestiones para destacar. En primer lugar, parece que nuevamente se verifica el teorema de De Pablo: hace ya más de 30 años, Juan Carlos De Pablo enunció una regularidad típica de los períodos de alta inflación, que se puede exponer más o menos en estos términos: «el índice de inflación del mes coincide con la fecha de su publicación», expresando que cuanto más bajo el índice más rápido se difunde, y si la noticia es mala, simplemente se publica más tarde. Esta vez, como se anunció un índice más bajo que el esperado, la noticia se anunció 5 días antes.

En segundo lugar, la alteración de las metodologías de captación de datos, y las componentes del índice, apartándose de las normas establecidas en la metodología del INDEC, vuelven a estar presentes en el parte de marzo como en los dos meses anteriores. Se está lejos de la versión de un «sinceramiento» del índice anticipada por algunos medios, que a esta altura -de producirse- tendría efectos legales sobre quienes ( acreedores en general) vieron que los ajustes realizados a través del índice CER ( directamente asociado al IPC) son fruto de una manipulación más que de errores de naturaleza estadística.

Más allá de los casos ya conocidos -referidos a alterar las mediciones referidas al sistema de salud, las verduras, la carne, etc.- cabe destacar la incidencia que tuvo en febrero, pero nuevamente en marzo, la caída en el rubro Esparcimiento (3,1% en el mes), concentrada en el ítem de Turismo cuyos precios disminuyeron 9,1%. Más sorprendente resulta observar que el costo de la canasta de Turismo según el instituto fue en marzo de 2007 2,5% inferior que el registrado un año antes. La deflación anual en Turismo no se corresponde con ningún hecho económico, sino simplemente con el cambio de canasta arbitrario realizado por las autoridades de INDEC y del Ministerio de Economía (de quien depende el Instituto).

La manipulación de los índices de precios traerá, tarde o temprano, un aumento de los litigios y probablemente otros efectos aún difíciles de precisar. Siempre será posible ocultar el «verdadero» cambio en el índice si en algún momento el instituto decide cambiar la canasta general (pasando de la canasta de la encuesta de gastos de 1996/7, a la nueva canasta basada en la encuesta de gasto del 2004/5, si se «empalman» las series). Pero en los hechos no es lo mismo subestimar la inflación en un punto por año, que hacerlo en forma abierta y grosera en varios puntos en unos pocos meses.

# Diferencias

Es difícil indicar hoy cuál es la « verdadera» tasa de inflación, pues si bien la mayoría de los precios está ajustándose a tasas de dos dígitos, las diferencias entre unos y otros son bastante elevadas. Precisamente el IPC constituye -cuando es medido de acuerdo con métodos y procedimientos reconocidos y replicables- un elemento de importancia para diagnosticar la presencia de eventuales desequilibrios a nivel agregado y sectorial, y proceder en consecuencia para corregirlos a través de la adecuación de políticas públicas.

Los desórdenes que genera la manipulación del índice y la subestimación sistemática (a esta altura, es claro que se trata de un sesgo hacia abajo, y no sólo bajar un mes y compensar con otro mes más alto) empiezan a generalizarse.

Simplemente a modo de muestra permítaseme señalar: a) la política monetaria es más laxa en tasas de interés que lo que aparece (las tasas son más negativas, porque la verdadera inflación es más alta), b) la política de controles de precios sería superflua, pues basta con manipular el índice para lograr una inflación suficientemente baja (¿algo de esto está pasando?), c) en una economía donde los salarios se guían por el IPC (los salarios más que ajustarse a nivel de empresa, responden a grandes acuerdos colectivos) la desaparición del elemento indexador (o sea, la desconfianza en el IPC) lleva a la posibilidad de desordenar completamente el mecanismo de ajustes salariales.

Es probable que en una economía en la que nadie cree en el IPC, surjan varios IPC «privados» que cada uno validará como la medición más adecuada. Por ejemplo, con una mirada sesgada se podría argumentar que el «verdadero» IPC se acerca a la canasta básica de alimentación, que en los últimos 5 meses ( desde que arreciaron los controles y la intervención en los mercados mayoristas) muestra un crecimiento anualizado superior a 25%. Otros podrían señalar que la «verdadera» inflación se acerca a precios no medidos, o precios de bienes o servicios mal medidos en el IPC oficial. Una mirada rápida indica que la mayoría de los precios de la economía que son de más difícil «control» crecen a tasas que oscilan entre 13 y 18% anual, con las excepciones yendo en general por arriba de estos números. Sólo el tipo de cambio nominal se mantiene relativamente estable en los últimos tres años, pero habrá que enfatizar que la «nueva convertibilidad» depende esencialmente de aumentar (no disminuir) el superávit fiscal y abrir más la economía. ¿Se atreverán a ello los mentores del «nuevo modelo»?

Sunday, April 08, 2007

Consejos para ser "progre"

Consejos para ser "progre"

A pesar de toda esta historia que se generó por mi participación en el programa de Dolina -que se emite por Radio 10- mucha gente, de todos modos, me ha llamado por teléfono o enviado emails diciéndome:
“Gille: yo quiero ser progresista, pero no sé cómo hacer”
Y es verdad, tener simpatía por la izquierda no es tan fácil como parece, aunque la región en estos momentos se encuentre gobernada por varias de sus figuras representativas... o que aparentan serlo.
Por eso, voy a dar algunos consejitos sencillos para que usted pueda ser una persona de los hoy llamados progres.

Elementos en la casa
En el hogar deberán tener algunas cosas obligadas como: mate (un básico), miel, alpargatas (aunque no las use, mínimo tener un par), sahumerios, una imagen de Mafalda, gato o perro de la calle, algo del “Che” (poster, pin, remera, biografía o los diarios de viaje), un disco de Manu Chao, alguno de Silvio Rodríguez, otro de Peter Gabriel, un par de jazz (Coltrane, Parker o Miles) y una guitarra (aunque no sepa tocar).

Lugares habituales
El consultorio del psicoanalista pasará a ser su segundo hogar. Frecuentar librerías por Av. Corrientes. San Telmo es una buena alternativa para pasear y comerse un choripán. En las vacaciones: curtir el Valle de Traslasierra, La Pedrera o El Bolsón (no estará mal visto la posibilidad de quedarse a vivir envasando mermeladas). Viaje a Cuba alguna vez en su vida. Cruce a Montevideo para la "llamada" cuando empieza el carnaval.

La persona progre debe fumar (si es pipa o tabaco negro, mejor). Debe tomar vino (si es tinto, mejor). Debe ir al teatro (si es comprometido y under, mejor). Debe ver películas lentas (cuanto más lentas, mejor). Asista al BACIFI, compre bastante artesanía (pullover de lana cruda, poncho, mantas indígenas, ocarina) y jáctese de tener la colección completa de La Maga. Ser vegetariano es una buena elección (el conservador es más carnívoro). Seinfeld sí, Midachi, no.

El nivel de instrucción por lo general tendrá que ser bueno. En caso de elegir pasar por la universidad, las carreras a elegir son: psicología, sociología, antropología, letras. El joven que opte por no ingresar a una casa de altos estudios se volcará al teatro, cine o bellas artes. No va de la mano con esta línea de pensamiento -de ninguna manera- querer ser instructor de tae bo.

La gente progre no se casa. Habitualmente trata de vivir en concubinato y los hombres llaman a su esposa “mi compañera”. En todo caso, si resuelve contraer matrimonio, nunca lo haga por iglesia, a lo sumo a través de un rito extraño. La fiesta se celebrará en su casa, hay que ofrecer empanadas o asado con vino y listo. No debe haber torta de casamiento, ni cintitas, ni carnaval carioca, menos aún liga. Como pareja emblemática prefiera la de Simone de Beauvoir y Sartre a la de Valeria Mazza y Ale Gravier.

Los progres han de enviar a sus hijos a la escuela pública y le prohibirán los mensajitos de texto y la play. Les regalarán muchos libros y habrán de mezquinarles juguetes. Nombres preferidos: Ernesto, Federico, Camilo, Farabundo. No les corten el pelo y -por favor- acepten que no se quieran bañar porque esa decisión es un acto de diferenciación, rebeldía y temple. Toleren que sus hijos los insulten, es el primer paso para que aprendan a enfrentarse al poder.

Arte y Literatura
Sus autores de cabecera pasarán a ser Arlt, Cortázar, Marechal, Pizarnik, Galeano. Citar con frecuencia a Habermas, Baudrillard y Sontag. Si es joven lea a Rodrigo Fresán. Sí o sí comprar "el dipló". Frecuentarán exposiciones de Carlos Alonso, Man Ray o Duchamp. Desacreditar a Beto Casella como filósofo popular... no tanto por ideología sino porque estoicamente hay que sostener que no miran televisión.

Por lo general no son muy deportistas (progre con tubos y tabla de lavar en lugar de abdominales es más raro que poder ver a Macri en sunga y tatuado). Son atletas sólo del café con debate, de preferencia en algún bar notable de Buenos Aires. Aceptan el fútbol como un fenómeno sociocultural y aquellos que realmente gustan de este juego están más identificados con la idea "menottista" que "bilardista".

Detalles personales
Usar algún tipo de sombrero, gorro o boina. Descarte la ropa entallada, siempre pantalones y camisas sueltas. En la mujer, mucha pollera larga. En el hombre, no a las botas texanas. Hoy en día es infaltable el morral. Usar el pelo largo aunque sea medio pelado o bien raparse totalmente (Telerman look). Puede tener barba (corta o larga) pero nunca bigotes solos.

Saturday, April 07, 2007

Los Ideales del Joven Socialista

Los Ideales del Joven Socialista
Federico N. Fernández

No creo equivocarme al decir que el joven socialista cuenta con la mirada benévola de buena parte de la sociedad. Es visto como un “idealista”, como alguien “que se preocupa por los demás”.

Muchos creen que nada complacería más al joven socialista que ver la eliminación de la pobreza y la injusticia. Además este muchacho es considerado “culto”, todos solemos verlo leyendo (obras de dudoso valor) en los bancos de las plazas. Su “look revolucionario” se compone de una barba de tres días (sí es que ha dejado de ser imberbe), esa suerte de pañuelo popularizado por Yasser Arafat y la remerita con la imagen del mártir latinoamericano: Ernesto Guevara.

Algo que siempre me resultó difícil de comprender es el hecho de que se haya gestado una moda revolucionaria, que ya es casi un uniforme.

Pero volviendo al tema que pretendo tratar, lo llamativo es la altísima consideración que genera en sus conciudadanos el joven que describimos. Se produce automáticamente en la mayoría de las personas una asociación entre ideales socialistas y el altruismo más puro.

Estos jóvenes, creen muchos, derrochan bondad y carecen de viles intereses “personales”. Cuánto mejor sería el mundo si un puñado de ellos estuviera en el poder, piensa un buen número de personas.

Su discurso varía en lo que refiere al radicalismo de sus ideas y a la concepción que tienen acerca de la “toma del poder”. Pero en lo que todos concuerdan es en lo siguiente: los que tienen más deben pagar más, debe apoyarse la industria y la producción nacional, abolirse el libre comercio, implantarse un gobierno de “unidad popular”, luchar contra los grandes capitales y repudiarse el pago de la deuda externa. Por supuesto que la economía y el ingreso deben ser fuertemente regulados por la autoridad central, y el sector público debe controlar los sectores “estratégicos”. Con este conjunto de “ideas”, el país experimentaría un crecimiento con equidad nunca visto en su historia.

Tengo la impresión de que ya son pocos los que plantean abiertamente la abolición (de derecho) de la propiedad privada tanto como el establecimiento del partido único a la paleocubana, aunque pocos realmente han dejado de ser partidarios de esas medidas.
Más allá de que todos los experimentos socialistas no han logrado más que la igualdad de los ciudadanos en la pobreza, o como destaca Revel, desigualdades entre los poderosos y la (pobre) gente común mayores que en el feudalismo; lo que me propongo criticar es la raíz bondadosa del conjunto de “ideas” socialistas. El socialismo implica necesariamente el establecimiento de un fuerte poder controlador. El individuo queda reducido a casi nada, considerado como un ser que no conoce el bienestar ni las formas de conseguirlo.
Son los omniscientes funcionarios a quienes compete decidir qué es lo que debemos comprar, ver, leer, de qué es mejor trabajar y qué es lo que conviene producir. Por más que muchas veces fue dicho, es bueno remarcar que la arrogancia que aqueja a estas personas es enorme. Creen estar capacitados para planificar la vida de millones y están convencidos de poseer la solución para todos los males. Entonces, creo que queda claro que el socialismo tiene como condición necesaria el aplastamiento de la libertad individual. De hecho, decidir es innecesario en un régimen socialista porque ya no hay opciones por las cuales inclinarse. La autonomía individual queda eliminada, y las decisiones libres y responsables son reemplazadas por las “buenas intenciones” dirigistas y el mejoramiento de todo por decreto.

Desde ya que el socialismo se destaca por una producción inmensa de leyes que garantizan todo tipo de “derechos”. La constante sobrelegislación forma parte de la manía por controlarlo todo que padecen las personas de las que estamos hablando. Por supuesto, nunca hay forma que tales disposiciones se plasmen en la realidad porque una de las características más sobresalientes del socialismo es su ineficacia económica.

Al desprecio por la libertad y tendencia a la tiranía debemos agregar otras dos marcas distintivas. La primera de ellas y la más terrible es, a mi juicio, la profunda envidia que aqueja y ciega al socialista. No puede concebir un mundo con desigualdad, salvo que tal desigualdad sea la que el mismo produce según su criterio. El principal enemigo del socialista no es la pobreza, sino las personas exitosas. Su pretensión de “igualdad de oportunidades” no tiene como objetivo principal mejorar la situación de los otros sino conseguir que nadie se destaque.

El socialista nunca analiza los motivos por los cuales hay pobreza en el mundo, ello no es necesario. Los ricos (países e individuos) son los culpables. Su riqueza nunca puede derivar del esfuerzo constante, el trabajo y la inteligencia. La riqueza proviene del saqueo, y más vale que así sea. De otro modo, el socialista tendría que enfrentarse con la realidad y analizar qué responsabilidad le cabe dentro de ella. Pero en lugar de hacer eso, y aquí encontramos la segunda de sus características, su forma de ser de eterno perdedor lo obliga a culpar a otro. Asume posiciones patéticas y extremadamente humillantes con tal de evadir el examen crítico acerca del fracaso. Nada bueno ni nuevo puede provenir del socialista, simplemente por el hecho de que para hacer debe necesariamente ocurrir previamente una transformación absoluta en las condiciones de la realidad económica y política, e incluso del hombre mismo. El paso de lo verbal a lo concreto nunca es dado por ellos, ni siquiera cuando alguno de sus intentos “revolucionarios” tiene éxito. La distancia que existe entre lo verdaderamente posible y lo absurdo de sus proyectos los obliga a pasar de “liberadores del pueblo" a carceleros del mismo. La revolución nunca puede cumplir ni los más insignificantes objetivos que se propuso. Debemos ser claros, por revolución socialista debería entenderse “gigantesco engaño”. Por ello, la siempre rápida metamorfosis que mencionamos. Ante el descontento de un gran número de gente defraudada, únicamente la violencia es el método viable para mantenerse en el poder. El momento en el que el engaño y el embuste ya no alcanzan llega muy pronto, potenciado por las delirantes promesas imposibles de realizar una vez en el poder. Como ha dicho Stephen Leacock: “El socialismo no funciona sino en el cielo, donde no lo necesitan, y en el infierno, donde ya lo tienen”.

Paradójicamente puede afirmarse que el socialista ha nacido para realizar funciones “ejecutivas”, su régimen no puede sobrevivir sin asesinar a una buena cantidad de “disidentes” y “reaccionarios”.

Thursday, April 05, 2007

Why There's Still No Pain at American Pumps

The Washington Post
April 5, 2007

They come with metronomic regularity in the U.S., media stories about "soaring" gasoline prices and the causes thereof, news stories which always identify the same two culprits, supply and demand. The stories always give various reasons why supplies are tight -- more often, why prices include a risk premium based on fears that supplies might become tight -- or why demand is higher than it is "should" be, given supposedly high prices.

Today, as the price of a gallon of regular ($2.70 nationally on Monday) "soars" almost to where it was (measured in constant dollars) in 1982, the "news" is: "Drivers Offer a Collective Ho-Hum as Gasoline Prices Soar" (the New York Times, last Friday). People are not changing their behavior because the real, inflation-adjusted cost of that behavior has not changed significantly, and neither has the cost of the commodity in question, relative to disposable income.

The next wave of stories about "soaring" gas prices will predictably trigger some politicians' indignation about oil companies' profits. The day after Exxon Mobil's announcement that it earned $39.5 billion in 2006, Hillary Clinton said: "I want to take those profits, and I want to put them into a strategic energy fund that will begin to fund alternative smart energy, alternatives and technologies that will begin to actually move us toward the direction of independence."

Sen. Clinton's "take" reveals her confiscatory itch. Her clunky "toward the direction of" suggests that she actually knows that independence is as chimeric a goal as Soviet grain production goals were.

President George W. Bush proposes reducing gasoline usage 20% in 10 years. Perhaps: After the oil shocks of the late 1970s, gasoline consumption fell 12% and did not again reach 1978 levels until 1993. This decline was produced by an abrupt and substantial increase in the price of gasoline, which no politician, least of all the president, is proposing. And Americans could get lower prices because Mr. Bush and various presidential candidates have become such enthusiasts for federal subsidies for ethanol and other alternative fuels. If these fuels threaten to dampen demand for oil, the Saudis might increase production enough to drive down oil prices, making investments in alternative fuels even more uneconomic than they already are.

In the 20 years from 1987 to 2006, Exxon Mobil invested more ($279 billion) than it earned ($266 billion). Five weeks after the company announced its 2006 earnings, it said it will invest $60 billion in oil and gas projects over the next three years. It will, unless a President Clinton and a Democratic-controlled Congress "take" Big Oil's profits, which are much smaller than Big Government's revenue from gasoline consumption.

Oil companies make about 13 cents on a gallon gas. Government makes much more. The federal tax is 18.4 cents per gallon. Mrs. Clinton's New York collects 42.4 cents a gallon. Forty-nine states -- all but Alaska -- make more than oil companies do on every gallon.

In 1979 President Jimmy Carter, an early practitioner of the Oh, Woe! School of Planetary Analysis (today Al Gore is the dean of that school), said that oil wells were "drying up all over the world." Not exactly.

In 1971, according to M.A. Adelman, an MIT economist, non-OPEC countries had remaining proven reserves of 200 billion barrels. After the next 33 years of global economic growth, Prof. Adelman says, those countries had produced 460 billion barrels and had 209 billion remaining. As for OPEC countries, in 1971 they had 412 billion in proven reserves; by 2004 they had produced 307 billion and had 819 billion remaining.

Well, then, what can be done about the gasoline "crisis" du jour? Americans could save 1.2 billion of the 130 billion gallons of gasoline they use a year if they would properly inflate their tires. And they might do that if ever "soaring" prices actually make gasoline unusually expensive.

Wednesday, April 04, 2007

Cavallo: Kirchner se hará ortodoxo tras elecciones

Criticó lo que llamó modelo "productivo"

Cavallo: Kirchner se hará ortodoxo tras elecciones

Ámbito Financiero

En un artículo escrito por Domingo Cavallo en su página de Internet pasa revista a lo que pueda acontecer en una futura gestión de Néstor Kirchner o eventualmente de Roberto Lavagna. Señala quiénes son los ideólogos del modelo «productivo» y quiénes lo llevan a cabo. Entre ellos menciona a Raúl Alfonsín, Leopoldo Moreau, Roberto Lavagna, y a Javier González Fraga, como un defensor de aquél. Anticipa una futura crisis de este plan oficial a partir de la cual la sociedad distinguirá los males que causó el dólar alto, y que Néstor Kirchner dará a partir de esto un giro de 180 grados.

Néstor Kirchner
# Quienes sigan con atención los pasos del ex presidente Raúl Alfonsín y de su Rasputín, Leopoldo Moreau, podrán advertir que la eventual candidatura de Lavagna a la Presidencia de la República, los llena de entusiasmo, aun cuando el ex ministro de Economía de Kirchner hace esfuerzos por aparecer lejos de ellos.

# Llamó ideólogos del modelo «productivo» a economistas que entienden la ley de la oferta y la demanda y que han defendido la devaluación del peso en 2002 como un «cambio de modelo económico». Los ejemplos más relevantes son Roberto Lavagna y Javier González Fraga en contraste con, digamos, Julio De Vido y Guillermo Moreno, que son ejecutores pragmáticos, sin pretensiones de liderazgo ideológico.

# Como el accionar de los ejecutores avanza sin contención en el gobierno de Kirchner, especialmente desde que el Presidente lo sacó a Lavagna del Ministerio de Economía, los ideólogos del modelo « productivo», han comenzado a sugerir que por errores de ejecución puede llegar a fracasar.

# En ese sentido, Lavagna critica la inminente crisis energética, el aumento del gasto por subsidios al transporte, las reestatizaciones parciales o t otales de empresas privatizadas, el control de precios, la utilización de los recursos no coparticipables y de los superpoderes para disciplinar políticamente a gobernadores e intendentes y la proximidad a la Venezuela de Chávez. Y terminan argumentando que Kirchner quiere construir un « capitalismo de amigos», con lo que dejan sembrada la sospecha de corrupción.

# Para desconsuelo de Alfonsín y Moreau, pero para bien de todos los argentinos, me atrevo a predecir que gracias a los acontecimientos políticos y económicos de los próximos cuatro años, gobierne Kirchner o gobierne Lavagna, la opinión pública va a descubrir la verdad de lo que ocurrió en las vísperas del Año Nuevo de 2002. Y esto permitirá, si no en 2007, con seguridad en 2011, la recuperación de las instituciones políticas y económicas necesarias para el progreso sostenido de la Argentina, sin las lacras de la inflación y del aislamiento internacional.

# Todos los problemas que hoy los ideólogos del modelo «productivo» quieren hacer aparecer como responsabilidad de los ejecutores pragmáticos, no son sino la consecuencia natural de la degradación política y económica en la que entró la Argentina desde aquel trágico momento.
# Néstor Kirchner fue, lamentablemente, uno de los dirigentes convencidos por los ideólogos del modelo «productivo. Este hecho demuestra su habilidad persuasiva,porque me consta que Kirchner antes era consciente de la importancia de erradicar la inflación y estuvo en contra del abandono de la convertibilidad en 2002, que entendía muy bien que los déficits y no la convertibilidad eran los responsables del endeudamiento público, a punto tal que durante los 90 nunca endeudó su provincia. En aquel entonces estuvo de acuerdo con la eliminación de los impuestos distorsivos y siempre reclamó la coparticipación automática de todos los impuestos recaudados por la Nación. Además, nunca adhirió a los reclamos proteccionistas de los industriales ineficientes y siempre se opuso a los gravámenes que desalientan la exportación desde las economías regionales.

# Los ideólogos del modelo «productivo» tuvieron una habilidad destacable en atribuir todos los costos de las nuevas medidas al modelo de la convertibilidad y de apropiarse de todos los beneficios de las circunstancias internas y externas que posibilitaron una rápida recuperación de la economía y cuatro años sucesivos de crecimiento a ritmo asiático.

# Ahora están tan engolosinados con este éxito propagandístico que se han lanzado a convencer a los argentinos que los costos que aún no han sido advertidos por la sociedad, pero que pronto se pondrán de manifiesto con elocuencia, no son responsabilidad del modelo «productivo» que ellos pregonan, sino de los errores cometidos por los ejecutores pragmáticos desde la salida de Lavagna del gobierno de Kirchner.

# Todos estos problemas provocarán muchos sobresaltos y crisis durante el transcurso del próximo mandato presidencial. Mucho más graves y frecuentes que las que tuvo que enfrentar Kirchner hasta ahora.

# Los colchones ofrecidos por la fuerte inversión modernizadora de los 90, la paciencia de los trabajadores y jubilados postergados, y el viento de cola de la bonanza internacional ya han comenzado a atenuarse en algunos casos y a agotarse en otros y difícilmente ayuden por muchos años más. Por consiguiente resulta interesante especular sobre cómo reaccionarían Kirchner y Lavagna frente a estos sobresaltos y crisis.

# En el caso de Lavagna, como principal ideólogo del modelo «productivo», no tendrá otra alternativa que ser consecuente con su promesa de mantener el tipo de cambio real alto y, por consiguiente, luego de permitir todos los aumentos de tarifas, precios, salarios, jubilaciones y gastos necesarios para remover los desequilibrios entre oferta y demanda causantes de las crisis, se verá obligado a devaluar el peso en la misma proporción en que aumente la inflación.

# El resultado será una espiralización de la inflación que en, pocos años, retrotraerá la realidad del país a la década de los 80, con inflación persistente y esporádicos episodios de stagflación y, si no se abandona antes la política de tipo de cambio real alto, hasta de hiperinflación. Se habrá desandado totalmente el proceso económico reeducativo de la convertibilidad, que con su éxito estabilizador de mas de 10 años, había logrado cambiar los comportamientos inflacionarios de los argentinos.

# Kirchner no podrá evitar los aumentos de tarifas, precios, salarios, jubilaciones y gastos necesarios para remover las causas de las crisis, pero por su testarudez tratará de demorarlos tanto como le sea posible. Me atrevo a predecirque Kirchner no convalidará con una devaluación el impacto inflacionario de todos estos reajustes. Es decir, antes de correr el riesgo de espiralizar la inflación, abandonará la lógica del modelo «productivo» y su tipo de cambio real alto. Porque Kirchner tiene olfato político y desapego a ortodoxias ideológicas. Ello le permitirá descubrir que no es buena para la gente ni para él, como Presidente, reintroducir en la economía argentina una inflación virulenta.

# Aun cuando para el momento del necesario sinceramiento de precios, tarifas y salarios, Kirchner tendrá suficientes evidencias de la inefectividad y de los costos de los controles de precios, y de las virtudes de la competencia, la estabilidad monetaria y la eficiencia de la empresa privada, en contraste con la corrupción y la ineficiencia que normalmente caracterizan a las empresaspúblicas, no creo que Kirchner vaya a estar en condiciones políticas como para dar un giro fundamental en la organización de la economía, como el que sería necesario para evitar una fuerte recesión. Por eso, en el mejor de los casos, su compromiso antiinflacionario y su desapego a ortodoxias ideológicas, al menos le permitirá evitar un escalamiento peligroso, como el que ineludiblemente provocarían las decisiones de Lavagna.

# Puede que me equivoque, y que Kirchner vuelva a someterse a la influencia de los ideólogos del modelo «productivo» también en el dogma del tipo de cambio real alto. Pero en ese caso, sólo conseguirá producir los mismos resultados inflacionarios que describí para una eventual gestión futura de Lavagna.

# Triste final. Pero al menos, con ejecutores pragmáticos, hay una posibilidad de evitarlo. Cuando están equivocados, los ideólogos son mucho más peligrosos.

Tuesday, April 03, 2007

The Trouble With Islam

Sadly, mainstream Muslim teaching accepts and promotes violence.

Tuesday, April 3, 2007

Not many years ago the brilliant Orientalist, Bernard Lewis, published a short history of the Islamic world's decline, entitled "What Went Wrong?" Astonishingly, there was, among many Western "progressives," a vocal dislike for the title. It is a false premise, these critics protested. They ignored Mr. Lewis's implicit statement that things have been, or could be, right.

But indeed, there is much that is clearly wrong with the Islamic world. Women are stoned to death and undergo clitorectomies. Gays hang from the gallows under the approving eyes of the proponents of Shariah, the legal code of Islam. Sunni and Shia massacre each other daily in Iraq. Palestinian mothers teach 3-year-old boys and girls the ideal of martyrdom. One would expect the orthodox Islamic establishment to evade or dismiss these complaints, but less happily, the non-Muslim priests of enlightenment in the West have come, actively and passively, to the Islamists' defense.

These "progressives" frequently cite the need to examine "root causes." In this they are correct: Terrorism is only the manifestation of a disease and not the disease itself. But the root-causes are quite different from what they think. As a former member of Jemaah Islamiya, a group led by al Qaeda's second in command, Ayman al-Zawahiri, I know firsthand that the inhumane teaching in Islamist ideology can transform a young, benevolent mind into that of a terrorist. Without confronting the ideological roots of radical Islam it will be impossible to combat it. While there are many ideological "rootlets" of Islamism, the main tap root has a name--Salafism, or Salafi Islam, a violent, ultra-conservative version of the religion.

It is vital to grasp that traditional and even mainstream Islamic teaching accepts and promotes violence. Shariah, for example, allows apostates to be killed, permits beating women to discipline them, seeks to subjugate non-Muslims to Islam as dhimmis and justifies declaring war to do so. It exhorts good Muslims to exterminate the Jews before the "end of days." The near deafening silence of the Muslim majority against these barbaric practices is evidence enough that there is something fundamentally wrong.

The grave predicament we face in the Islamic world is the virtual lack of approved, theologically rigorous interpretations of Islam that clearly challenge the abusive aspects of Shariah. Unlike Salafism, more liberal branches of Islam, such as Sufism, typically do not provide the essential theological base to nullify the cruel proclamations of their Salafist counterparts. And so, for more than 20 years I have been developing and working to establish a theologically-rigorous Islam that teaches peace.

Yet it is ironic and discouraging that many non-Muslim, Western intellectuals--who unceasingly claim to support human rights--have become obstacles to reforming Islam. Political correctness among Westerners obstructs unambiguous criticism of Shariah's inhumanity. They find socioeconomic or political excuses for Islamist terrorism such as poverty, colonialism, discrimination or the existence of Israel. What incentive is there for Muslims to demand reform when Western "progressives" pave the way for Islamist barbarity? Indeed, if the problem is not one of religious beliefs, it leaves one to wonder why Christians who live among Muslims under identical circumstances refrain from contributing to wide-scale, systematic campaigns of terror.

Politicians and scholars in the West have taken up the chant that Islamic extremism is caused by the Arab-Israeli conflict. This analysis cannot convince any rational person that the Islamist murder of over 150,000 innocent people in Algeria--which happened in the last few decades--or their slaying of hundreds of Buddhists in Thailand, or the brutal violence between Sunni and Shia in Iraq could have anything to do with the Arab-Israeli conflict.

Western feminists duly fight in their home countries for equal pay and opportunity, but seemingly ignore, under a façade of cultural relativism, that large numbers of women in the Islamic world live under threat of beating, execution and genital mutilation, or cannot vote, drive cars and dress as they please.

The tendency of many Westerners to restrict themselves to self-criticism further obstructs reformation in Islam. Americans demonstrate against the war in Iraq, yet decline to demonstrate against the terrorists who kidnap innocent people and behead them. Similarly, after the Madrid train bombings, millions of Spanish citizens demonstrated against their separatist organization, ETA. But once the demonstrators realized that Muslims were behind the terror attacks they suspended the demonstrations. This example sent a message to radical Islamists to continue their violent methods.

Western appeasement of their Muslim communities has exacerbated the problem. During the four-month period after the publication of the Muhammad cartoons in a Danish magazine, there were comparatively few violent demonstrations by Muslims. Within a few days of the Danish magazine's formal apology, riots erupted throughout the world. The apology had been perceived by Islamists as weakness and concession.

Worst of all, perhaps, is the anti-Americanism among many Westerners. It is a resentment so strong, so deep-seated, so rooted in personal identity, that it has led many, consciously or unconsciously, to morally support America's enemies.

Progressives need to realize that radical Islam is based on an antiliberal system. They need to awaken to the inhumane policies and practices of Islamists around the world. They need to realize that Islamism spells the death of liberal values. And they must not take for granted the respect for human rights and dignity that we experience in America, and indeed, the West, today.

Well-meaning interfaith dialogues with Muslims have largely been fruitless. Participants must demand--but so far haven't--that Muslim organizations and scholars specifically and unambiguously denounce violent Salafi components in their mosques and in the media. Muslims who do not vocally oppose brutal Shariah decrees should not be considered "moderates."

All of this makes the efforts of Muslim reformers more difficult. When Westerners make politically-correct excuses for Islamism, it actually endangers the lives of reformers and in many cases has the effect of suppressing their voices.

Tolerance does not mean toleration of atrocities under the umbrella of relativism. It is time for all of us in the free world to face the reality of Salafi Islam or the reality of radical Islam will continue to face us.

Dr. Hamid, a onetime member of Jemaah Islamiya, an Islamist terrorist group, is a medical doctor and Muslim reformer living in the West.

Jobs and Immigrants

April 4, 2007

While politicians haggle over immigration reform, the U.S. economy's demand for workers foreign and domestic continues to grow. On Monday U.S. officials began accepting applications for the 85,000 available H-1b visas -- the kind that go to foreign professionals -- for the fiscal year starting in October. By Tuesday, the quota had been filled, making this the third straight year that the cap was reached before the fiscal year had even begun.

It's another example of the disconnect between immigration policy and labor market realities. A common assumption of immigration critics is that alien workers are either stealing American jobs or reducing home-grown wages. But both notions are flawed, according to a new and illuminating study by economist Giovanni Peri for the Public Policy Institute of California.

Using Census data, Mr. Peri analyzed the effects of immigrant labor on California, home to some 30% of all foreign-born workers in the U.S. The University of California at Davis economist found "no evidence that the inflow of immigrants over the period 1960-2004 worsened the employment opportunities of natives with similar education and experience." As to wages, Mr. Peri found that, "during 1990-2004, immigration induced a 4 percent real wage increase for the average native worker. This effect ranged from near zero (+0.2%) for wages of native high school dropouts and between 3 and 7 percent for native workers with at least a high school diploma."

This means immigrants not only aren't "stealing" jobs; they're helping to boost the pay of native U.S. workers. These findings aren't as shocking as they might first seem once you consider the abilities that immigrants bring here, and how they compare with those of U.S. natives.

Most immigrants fall into one of two categories: unskilled laborers with less than a high-school diploma and skilled professionals with advanced degrees. In 2004, 67% of California workers who lacked a high-school diploma were foreign born, as were 42% of those with doctorates. By contrast, across the entire U.S., natives are concentrated between those two extremes: They comprise just under a third of workers without a high-school diploma and only 28% of those with Ph.D.s.

What this means is that immigrants on balance serve as complements rather than perfect substitutes for U.S. workers. For the most part the two aren't competing for the same jobs, so rather than displacement what we're getting is a bigger economic pie. This dynamic has resulted in a more efficient domestic labor market, greater investment, higher overall economic growth and more choices for consumers.

"In nontechnical terms," writes Mr. Peri, "the wages of native workers could increase because the increased supply of migrants is likely to put native workers in jobs where they perform supervisory, managerial, training, and in general interactive and coordinating tasks, which makes them more productive." More workers also mean more consumption, so "immigration might simply increase total production and demand without depressing wages."

It turns out that immigrants compete most directly with other recent immigrants. Mr. Peri found that "Foreign born workers already here sustain the largest losses in real wages, losing between 17 and 20 percent of their real wage" from 1990 to 2004.

It's true that most immigrants compete for jobs more directly with low-skill U.S. natives. But even here the job preferences differ, with foreigners more likely to be found in agriculture, while less-educated natives tend toward manufacturing. Mr. Peri finds that even unskilled foreign workers have a slight positive effect on the wages of their native counterparts. Other economists, such as George Borjas of Harvard, have found a slight negative effect in this cohort. In any case, and considering the overall net economic gains, any immigration reform designed to protect this small (and shrinking) subset of unskilled native workers would seem short-sighted at best.

As Congress prepares to give immigration policy another go, expect to hear lots of talk about the dire consequences of immigrant labor. The facts -- and the California experience -- argue otherwise.

Sunday, April 01, 2007