João César das Neves
"When the State budget introduces measures
which affects half of the GDP,
it only means that many people live off other people's money,"
concludes César das Neves,
reflecting on the exponential increase
in the share of government spending in Portugal's GDP
and its perverse effects.
"One of the most bizarre facts of our time is,
the enormous amount of people who lives off the money of others,"
writes João César das Neves,
Professor of Economics, of the Catholic University.
The media treats the subject almost exclusively on an hourly basis:
The State Budget deficit to fund the troika;
the requirements of the troika's support ;
and the government's cuts in expenses and allowances;
this crisis is, in essence,
a fight over other people's money.
The main cause of the phenomenon
is undoubtedly the dramatic increase in the size of the state.
In the nineteenth century, public expenditures,
were on average only a tiny 5% of the GDP of the time.
At the end of the First Republic,
that weight had doubled.
It doubled again until 1974, when the State,
spent one-fifth of what its people produced.
In 2010 this figure exceeded 50%,
which the austerity measures of the troika have already reduced to 45%.
When the State Budget requires half of what a country produces,
for salaries, allowances etc.,
it means that there are a lot of people who live off
and depend onother people's money.
In large private companies something similar happens,
because everything belongs to a multitude of shareholders,
and the expenses of one department,
have little to do with the value of the final product.
No wonder that many managers
adopt similar attitudes to those of public services,
perhaps just a bit less blatant.
They also spend other people's money.
The European Union has brought new nuances to the process,
enabling people to live off money from far away.
It's amazing that so many people feel entitled to
the wealth of regions that that they have never seen
or even know of.
If Portugal's money was to be sent to far away countries,
they would be horrified,
but on the other hand, they find it normal,
to demand a share of the wealthy German bounty.
The climax of the process came about
with the globalization of capital,
which allows people to use money from strangers.
In itself, credit does not mean that they get funds from others,
because, of course, they will pay tomorrow
that which they spend today.
But in a financial crisis like the present one,
there is strong likelihood that they'll never pay back anything,
which changes everything.
It is true that these new forms of capital spending,
changes the pejorative meaning
derived from a traditional portuguese expression:
"amigos do alheio" - "alien friends ", meaning thieves.
Nowadays, people don't think that spending other people's money
could in reality, be considered theft.
The public servant,
who works hard for his well-deserved salary
and the socially subsidized sector has reason to exist.
Despite the fact that the funds come from someone else's hard work,
focuses on disturbing new elements.
The first problem is the lack of a clear definition.
A baker knows that what he earns depends on what he produces.
But the official, the public servant, the retired person,
the trade unionist, the subsidized,
have no idea of their real monetary value.
The amounts paid out by the state, are determined by abstract concepts,
such as social justice or social necessity, progress or social interest.
This allows for funds to soar, as has happened in Portugal until 2011,
or immensely brutal cuts, as has been happening since then.
The second aspect is the ease with which other people's money is spent.
In a public school, where tuition and salaries
have nothing to do with the values of the product involved,
parents and teachers make demands to the ministry
that would never be heard in schools which available funds
come from the pockets of students.
It is notorious to notice
the nonchalance with which ministers and mayors
appropriate themselves of the budgeted amounts
and the Structural Funds,
which does not cost them any effort to earn.
The most interesting fact is
the reasons why honest and well intentioned people
gleefully spend that which is not theirs.
These reasons originate from two dangerous pitfalls:
The first is the belief that money is not needed by the owners.
People pretend to believe that the public funds come from the rich,
allowing no guilty conscience, always demanding more support,
more subsidies, more roads and more expenses.
This despite the evidence,
that even if all millionaires would pay what they owe in taxes,
it would be largely insufficient to half the GDP.
The other mistake is to think that if I do not spend,
the another department will waste it,
which amounts to the same:
the other person has no lack of money .
Whatever the case,
it is absolutely pathetic
the way people abuse of other people's money.
Translated and adapted by T Smit
Translated and adapted by T Smit
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