There are apparently two paradoxes in the behavior of the executive and Congress in relation to fiscal policy. The first concerns the supposed reversal observed in relation to the austerity standard at the beginning of the term of office and expansion of spending at the end. It would be the proverbial political cycle in fiscal policy. The second is that the congress would be conservative, and the expansionist executive. A close look reveals that the issue is more complex.
At the beginning of the term, the government sponsored an unprecedented fiscal expansion. And this happened due to the nature of the.
Its extreme vulnerability leads him to anticipate the expansion of spending on. At the same time, he launched attacks as a strategy of moving responsibilities. The recent increase in the inconsistency of discourse and practice.
The expansion of spending in the election year has been the tonic in the country. In 2006, it was 10.3%, reaching impressive 15.3% in 2010, in the election of. It was elevated in 2014 (6.3%) and 2022 (6%), when it even used the precatory to generate cash. The exception was 2018 and has a clear explanation. Under the expense grew 1.8%. This is what happens in the rare cases where the incumbent is not a candidate and does not mobilize the expense for any candidacy.
The current conflict between Congress and the Executive is also easy to explain. The fact is that the government has never abdicated the expense. The tax framework was an authorization for its expansion. But the government has not anticipated its dynamic effects. Hence the austerity selective policy: aims at the ministries that are in the middle signaling containment. At the same time, the timely package of Bondades arises. It includes programs of.
And measures such as exemption in the light bill and distribution of gas cylinders, among others. In addition, the important use of parafiscal stimuli and the anticipation of benefits such as clear contradiction with monetary policy. The alternative of higher political cost – reducing subsidies and exemptions – is abandoned.
It is the feasibility of these programs and measures that are in dispute when Congress – but mainly leaders are aligned with rival presidential candidacies – imposes obstacles to increased revenue. At the same time, the congressional majority also seeks reelection, which transforms the budget into a field of dispute, a zero sum. Due to its composition, Congress has been imposed over the past decade a strong asymmetrical tax restriction on governments: veto for increased revenue, but not for the expense of interest of the legislative majority.
The socialization of the costs of this dynamic of executive-legislative relations has limits. A is one of them. However, what we have seen for decades is a perverse political balance anchored in the granting of sectoral benefits for groups and sectors with strong influence on the game. The executive is his referee. But the game became more complex with.
The result is that the ability to arbitrate by the executive of losses and gains involved has been exhausted.
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