“If you had zero inflation and you have to lower public spending by 10 points, you have to go and tell people ‘Look, next month you will earn 10% less‘”, he raised in dialogue with A24.
On the other hand, high inflation makes it possible to adjust by also implementing salary increases. For example, in an inflationary framework of around 50, 52%, if the Government aims to liquidate 10% of public spending, it can also raise salaries and pensions by around 40%, making a less perceptible adjustment process. In this way, although in practice the loss of purchasing power is the same, the Government can say that “it has not come to adjust”. Furthermore, this method aims to “avoid spiralization” of inflation.
For the analyst, the change will come with a change of power, which through the vote “in four years removed a president and in the first mid-term election he voted against the person who had just voted.”There is still time for that cultural change, because now society itself is going to have to demand that someone correct this”, manifested.
“In a democracy, politics is chosen with votes and politics appears at some point; a coalition, a leadership or someone who perceives this issue and who has to begin to understand that reducing inflation is popular,” he concluded.
Source: Ambito
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