A Country Corseted by the Privileged Few

The 2017 budget drawn up by the government of Costa Rica is the result of an arithmetic exercise, where the political will of the Solis administration has barely reduced maintenance and has increased privileges in the dominant state corporations.

Wednesday, September 7, 2016

EDITORIAL 

Scandalous could be the best word to describe the magnitude of the increase of 12% which the Solis Rivera administration has made in the 2017 public budget. The 12% increase not only far exceeds the projected inflation for this year, but is disproportionate and far from reality, considering the serious and urgent fiscal problem facing the country. 

As Juan Carlos Hidalgo explained well in his opinion article on Nacion.com, "...The budget is 12.1% more than the 2016 budget, which is four times higher than the inflation projected for next year (3%). If we consider spending in real terms (discounting inflation), expenditures will grow at a rate of twice that of the economy. "

Hidalgo adds: "...Another point is also clear: if paying interest on the debt demands ever more resources, the responsible thing would be for the government to cut or at least stop increasing other items. But they are not even doing that: the remaining 56% of the increase in spending has to do with things that are not related to paying off debt. The treasury argues that much of this is a result of legal mandates. But instead of looking to relax, or better yet, eliminate some of these absurd requirements that do not correspond to the economic reality of the country, the government continues to aggravate them. Next year, the Treasury will have to deal with about ¢300,000 million in new spending without financing for it. These are largely the result of laws that were cheerfully sanctioned by Luis Guillermo Solis, such as the Labor Procedure Reform."

See article "Disastrous Budget" (In Spanish)



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