Re: Incomes and Exchange rates; part 2

[Juan Jose Barrios <jota@xxxxxxxxx>]

At 04:22 PM 9/17/97, you wrote:
>Juan Jose Barrios "Juanjo" wrote:
>
> ---- some snipping ---
>
>>There is no way
>>Argentina can move forward within the current radical neoclassical (imported
>>from some academic thinking from the US) economic regime. The other day, a
>>Uruguayan economic weekly magazine (Busqueda) *proudly* told its readers
>>that the Chilean 'miracle',( starting in 1973) managed to reduce the amount
>>of people living below the poverty line  from 45% to 30% since 1992 to
>>1997!!!! Doesn't it sound almost unbelievable?  Argentina is going trhu a
>>similar (more radical) process
>
>  Could you expand on this?  In the U.S. we are being told of the Chilean
>  miracle -- proof of the free market, free trade economics.  Now the
>addition
>  of Chile to NAFTA -- the U.S. Mexico Canadian "free trade" agreement -- is
>  proposed and is likely.  We are being told that NAFTA is a great success
>  or a great failure in Mexico.  Is there a truth hiding somewhere?
>
Chile and Bolivia have joined the MERCOSUR (Free Trade Agreement b/w
Argentina, Brazil, Paraguay and Uruguay) and will be admited as  full
members in the year 1999 I believe. And it seems it will not be admited to
NAFTA becuase of some institutional problem (I am not sure what exactly).
About the succes or not of NAFTA, that is not so according to EPI for example.

I will come up with some data as soon as Ican get rid of a lot of work at my
University.

Who is telling you of the Chilean miracle?

>  What is wrong with reducing poverty "from 45% to 30% "?

I did not express myself correctly. First of all, I showed Chile as an
example of what Argentina is doing. Chle began its process of
liberalization, etc during the 70s. After more of 20 years of 'progress' ,
they end up with more poors than when the process started (45% in 1992 and
less than 20% in 1973, I believe). So the question is: what miracle?. The
issue reduces to  what point of view one is looking at the respective
economy. Should you care about efficiency issues alone, well you can say
that Chile is more efficient. Shoud you care about not only efficiency but
quality of life (for example people under poverty line) and the picture
maybe somewaht different. I believe this is also a current debate in the US
where profits have skyrocked,  high growth rate, but real wages are at the
1965 level and some figures show that the perecentage of poors is
increasing. The difference is that Chile started at a much (absolute and
relative) lower level....

Second, of course that what the current government has done is excellent in
terms of reducing the quantity of people under poverty and I did not intend
to critize that issue. I have had only 'light' chats with some friends about
the actual ecoomic policy so I can't comment on that in detail. However, I
have been told that the govt. for example is actively  acting in setting
economic and financial policies. In other words it seems that some of
policies instrumented during the military govt have been untouched but not
others.  By the way: How difficult is to reduce poverty from 45% to 30%?



>
>           Mason C
>
>
>