When crisis strikes

When crisis strucks we expect governments to be prepared to take measures. We believe politicians justcan'twait for the crisis to go away in the same wayit arrived. But maybe we should think it twice before presssing them into taking decisions that may not be as useful and effective as wanted. For example, let's take a look at Spanish president Zapatero's main anticrisis measure, his PlanE better known as Estate Fundfor local investment). This plan mainly consists of 8.000 millions which will be given local administrations to be spend on public infrastuctures during 2009. Its purpose is to attenuate the steep rate at which Spain is destructing working places. The goal is obviously right, but the means will likely turn out to be a complete waste of public money.

There are many reasons that support my pesimism about this plan (just take a glance here or here), but to my mind there are mainly three. First, local administrations willing to take a piece of the cake needed to present the projects to be funded by this PlanE in a very short period of time and, at the same time, this projects needed to be executed before the end of this year. The result is that most of the money will be spend in non-priority equipments or key infrastructures that can actually make a difference both in daily and long-term economy. What significant change is it going to make to invest in fixing drains, improving public parks, re-asphalting roads and sidewalks, and other minor workings to an economy? What benefit besides a quick wash of city faces and hundreds of short-term, non-qualified jobs?

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The second reason, which comes as a consequence of the first, is that it will not help to reorientate the spanish economy away from the construction extasis on which it has been based during the last ten years. Instead of investing money on other more profitable sectors (telecommunications, renewable energies, biotechnology, etc) the Spanish government keeps incentivating the construction sector. Instead of approaching the real problem (the excessive dependence of the spanish economy on the construction sector) it has preferred to take a populist measure and try put some make up on the shamefull unemployment figures we'll see in a few months.

And third, and as usual, the Catalan adminstration has had nothing to say about a measure that could invade autonomic competences, that applies the same medicine to all regions (as if the Catalan or Basque economy had anything to the with Andalusia's or Murcia's) and ultimately will be mainly paid by the catalans.

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Posted in Transportation/Automotive Post Date 02/05/2020