Mark Weisbrot wrote this letter. They are trying to collect
economists' signatures. If you are interested, reply to the
address at the bottom, not to me or the list.
An Open Letter From Economists on the Crisis in Argentina
We, the undersigned economists, express our concern
that the IMF is pressuring the Argentine government to adopt
fiscal policies that may aggravate the worst
economic crisis in that nation's history. Most importantly, at
the IMF's urging, the government is about to cut about 14 percent
(or 2.7 percent of GDP) out of its central
government budget, as well as $3.5 billion (1.3 percent of GDP)
from provincial budgets.
The effect of such budget cuts could very well
aggravate the downturn of Argentina's economy, and delay its
recovery. The Argentine economy has been in
recession for nearly four years, and unemployment is more than 22
percent and rising. The banking and financial system is also in
severe crisis.
Rather than insist on draconian spending cuts in this
situation, the IMF should arrange, together with other creditors,
a moratorium on government debt service
payments. This moratorium should continue at least until the
economy has returned to normal growth.
Since the central government has been running a
primary budget surplus, a moratorium on debt service payments
would enable the government to live within its
means, without having to resort to spending cuts that could
prolong the recession and hurt the most vulnerable among the
Argentine population.
Marya Murray Diaz
Center for Economic and Policy Research
1621 Connecticut Ave., NW Ste. 500
Washington, DC 20009
(202) 293-5380 ext. 208
Fax: (202) 822-1199
[EMAIL PROTECTED]
www.cepr.net
--
Michael Perelman
Economics Department
California State University
Chico, CA 95929
Tel. 530-898-5321
E-Mail [EMAIL PROTECTED]
