Morena’s national president, Alfonso Ramírez Cuéllar, explained that there is a risk that all the savings in federal funds will be depleted.
MEXICO CITY (El Financiero) – As it always happens with populist governments, money runs out from giving it away. The funds from almost 20 years of “neoliberal” governments are practically gone. AMLO’s government has spent them in only 16 months.
Now, Morena’s national president, Alfonso Ramírez Cuéllar, explained that there is a risk that all the savings in federal funds will be depleted. In a press conference, Ramirez said: “Austerity measures implemented by the government were positive and served to discipline public finances. However, the cuts have already reached their limit. They will be insufficient to finance increased spending to deal with the coronavirus pandemic and support the millions of unemployed”.
Ramírez considered it “urgent” for the government to resort to debt. There must be a discussion and agreement on how much the debt should be when it should be paid, and by whom. Otherwise, -Morena’s national president warned- the continuity of various public policies focused on social welfare is at risk.
“We urgently need to resort to the line of financing. I think we have no other option. The government is doing the impossible by not resorting to financing. Still, I think we have concluded that we will finish all the savings in the federal funds”. Ramírez Cuellar stated.
Participating in the virtual seminar “Contrast of proposals to face the crisis of COVID-19″, Ramírez explained that due to the economy’s contraction and the fall in oil revenues, there is a “red light” this year. There will be a “very big” insufficiency in the collection of resources. Likely, the goals approved in the 2020 Federation Income Law will not be achieved.
“We have all already concluded that a 75 percent reduction in spending will give us just under 60 billion pesos, from which we cannot achieve much. It has already been demonstrated that austerity is a mechanism for rational spending. Still, it is not going to allow us to detonate growth.”
Ramírez Cuéllar explained that debt is necessary to attend to the health sector and address “the tragedy of unemployment.” It forces the government to implement all the measures required to support employment and companies, but especially small businesses.
“I believe that today more than ever, there is a need to strengthen and save the activity of many production units. Micro and small businesses are fundamental to ensure that when the emergency passes, the workers can return to work, and economic activity can be reactivated. He said.