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Gustavo Petro voices support for Gran Colombia (hexbear.net)
submitted 7 months ago* by to c/news@hexbear.net
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[–] 25 points 7 months ago* (6 children)

These countries are close and the economies are similar. It's not like Venezuela's monetary policy has been wildly successful. Mexico, Brazil, Argentina would still be way bigger with a single currency.

You can't just repackage analysis for the 20 countries in the EU for the 3 small countries in Gran Colombia

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  • [–] 14 points 7 months ago (4 children)

    It still introduces the problem of being unable to deficit spend. Venezuela specifically makes a lot of use of deficits to fund its reforms and programs, if they couldn't do that anymore how would the system even function?

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  • [–] 14 points 7 months ago* (last edited 7 months ago) (1 child)

    Just to expand on what you're saying, it wouldn't function properly at the very least and you can look here in Brasil for confirmation of that.

    After the 2015 coup of Dilma with her impeachment, we saw Michel Temer take her place and with him came the implementation of a "spending roof" where we can't spend more than the predetermined amount (the roof) to keep the economy in a superávitary state, of course there are specific situations where the government can spend above that, but as rule of thumb it can't go over. Because of that our economy growth is now capped (I don't remember the exact percentage, but it's a very low single digit), we can't properly develop infrastructure, our social nets gets fucked, in particular you can look at SUS (our public health system) where it continues to go underfunded and attacked at every turn. As another example, you can also look into Correios (our national mail delivery system) which has seen mass attacks and has been underfunded to both reduce spending and create the conditions for it's privatization, which hopefully failed so far.

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  • [–] 7 points 7 months ago

    After the 2015 coup of Dilma with her impeachment, we saw Michel Temer take her place and with him came the implementation of a “spending roof” where we can’t spend more than the predetermined amount (the roof) to keep the economy in a superávitary state

    Vampiro filha da puta

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  • [–] 10 points 7 months ago*

    That doesn't address what I said tho. I'm not directly comparing it to the EU because it doesn't make sense to do so, completely different situation. The problem is that without a central bank in each country with it's own sovereign currency, they cannot control their economy and cannot go into déficit, essentially capping their growth. The MMT correctly describes how spending occurs on a capitalist country and lays bare the lie of neoliberalism and the need for a superávitary economy. Note that I'm not defending the MMT as a viable solution or anything like that, just agreeing with it's descriptive side.

    It's not like Venezuela's monetary policy has been wildly successful.

    I don't know enough to talk about Venezuela's economy, but I would bet that are other issues at play here if you're referring to a déficitary monetary policy, because that is basically the default for almost every major country in the world.

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