Economics and politics

The interaction between economics and politics is not a simple thing. Often the economic effects of measures generated with political intentionality are different from those that were intended in the first intention. Let's see a couple of spiky examples of news in recent days.

Until now, the person responsible for the mortgage tax (documented legal deeds) was the one who received the loan. After the monumental chaos generated by a supreme court in economic competition, the Sánchez government ruled, by decree, that the passive subjects will be the creditors, ie the banks. It seems that he believes this will be beneficial for mortgage beneficiaries. In fact, the minister of the section has insisted that it will be supervised that the payment really falls on the banks and that it does not affect it. It will not be so, not for the direct action of the banks, but for the impersonal action of the financial markets. Suppose you are taking a loan of 100,000 euros. And we say that in the previous regime this represented the obligation to pay a fixed amount of 4,000 euros per year for a certain number of years. Moreover, the recipient of the loan had to enter the Treasury at the time of signing the contract, 1.5% of its value. What will happen in the new regime? The bank will now be the one that will enter the Treasury but the mortgage market is so large that simply what will happen is that the new mortgage balance will be established in an annual payment, less than 4,060 euros but more than 4,000, which will leave the bank and the recipient of the mortgage exactly as before. The bank has a higher initial expenditure, but compensates for the small tax increase and the borrower saves the initial payment, but the commission increase ends up canceling this advantage. It is as if I now pay the tax by obtaining a loan (something that had previously been done before). In short: the financial market will reimburse the tax on mortgage receivers and will continue to pay, in total, what they have paid so far. Who is the passive subject is irrelevant and nothing important will change. It seems to me that the Sánchez economic team knows it well enough and it is reasonable enough not to try to attack the windmills of the financial markets.

I also see from the press that ANC intends to promote a kind of certificate of good practice for companies. Apart from what one thinks of these good practices, it is easy to foresee that the initiative will be a great failure. This certificate can be attractive to consumers who are in solidarity with ANC, but it will be exactly the opposite for those who do not sympathize with it. And since there are two types, there will be very few and very small companies that will play it. It is a reckless initiative.

In these two examples we could say that the natural reactions of private markets will neutralize the intentions of the political initiative. However, if the economic domination on which the political initiative acts is not the markets but the public sector itself, then, to clarify, the effect on the economy can be important. We see it, even in these days, with the discussion on the approval of the budgets, the State, the Generalitat and the Barcelona City Council. Failure to approve it will have a negative economic impact. The question is whether the failure to approve the state, which will drag the other two in the same direction, will have a positive political impact. Here I think of Artur Mas: I prefer to favor a government of Sánchez in Spain compared to a PP-Citizens-Vox government. I recognize that with the leaders in prison, whose release must be the political priority of the moment, it is expensive to make movements that can be read as in collaboration with the state. But the fact is that we do it every day and in many areas. We should learn to calculate and negotiate in cold blood. When negotiating it is clear that he has a lot of retaliation, that is, the damage that can be done on the other side if there is no agreement. But it also counts how much you can hurt yourself by performing reprisals. In this case, by not voting on financial statements, Sanchez is not equally damaged, even in a Machiavellian perspective, we can think that in the short term it is favored. The impact on the budget of the Generalitat is negative. But more important: to push Sanchez, sooner or later, to understand with the citizens, as many say his party. I do not see grace, frankly.

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