jueves, 8 de diciembre de 2022

Prices versus Values

Besides formulas and financial policies, the economy has much of common sense...

Isidro Agustín Fardales González en Exclusivo 19/02/2016
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¿How much a pound of tomatoes costs? The answer is easy, although it will depend on the region where it is asked.  ¿How much the memories of a loved one are worth?  Oscar Wilde described a cynical person as that who  knows everything about prices but nothing about values.

In these days, when this subject is being discussed by many Cubans, it might be useful to recall that phrase from the famed English writer since many would-be economists try to explain the complex situation of the nation through the vision of the law of exchange values, and forget other spiritual values that are, in fact, those who define us as human beings.

The problem of the prices is indeed complex. The theory of complexity is founded in the infinite relationship between facts, factors, circumstances and even what the scientist called enthropy, that we commonly know as “casualidad”  or “it just happened”.

In the Cuban case, prices have not been set in the past few years through the application of cost formulas, but as a decision independent of that factor.  Such formula, which at a determined historic period was of value, has become deformed.  Prices have been assigned other functions, such as that of establishing a balance between the amount of merchandise and the demand for it from the consumers.

However, this writer considers that the solution of the problem  may be found in the human being itself, in  its subjectivity, in his spiritual values.

And I say that because it does not matter if the State applies a shock therapy or other more studied measures if those who are to fulfill them or enforce them let themselves be trapped by personalisms,  technicisms and  skullduggery, sinking their noses into the numbers just to avoid watching the shock in the faces of their fellow human beings.

The economy is much more than formulas or financial  policies: it has a large component of common sense, which lamentably is not the most common of the senses.

It seemed that the 2015 Parliamentary sessions would have concluded without any announcement of impact, just as it had happened in previous years. But one presentation, apparently casual,  rocked the hall of the meeting.

The Executive Board answered speedily and fortunately chose  the longest but most sustainable road. Without falling into the trap of putting a ceiling on prices, and in face of the impossibility of creating a higher market or breaking the inconsistencies of the monetary duality, it opted for supporting the key productive sectors to incentivate and encourage them and reorganized the systems of balance and the recollection of agricultural products.

The first one, and perhaps the most important, has been the production of foodstuffs. The Government has announced, and already introduced, financial measures, investments, access to agricultural equipment and has introduced a larger role for the State in the distribution of foodstuffs.

Agriculture is a key sector because the reduction in the prices of foodstuffs shoud also lead to other price reductions; at least that is what is expected.

Other basic services could follow the same formula, such as transport, where the State should have never allowed the installation of the supply and demand law.

In all these fields there should be present a definite governmental intention, that is, to créate mechanisms of support to all those who are involved with those services, be them cooperatives, self employed or the state supported enterprise, because then the negotiations to lower prices would be easier.

At the same time, it is vital to fight corruption, which today is the main supply source of the private sector, and improve the tax mechanisms, whose ups and downs are in fact paid by the clients and not by the owners of the businesses.

Suffice be the example of the cafeterias that have skyrocketed their prices after being rented out to its former workers or the spectacular increase of fees of barbers, private taxies, coaches, garage operators and a long list of activities operated by private entrepreneurs who in many instances set their own prices.

Eliminated should be vices such as cover inefficiencies with high prices, the non-compliance with budgeted plans and the execution of investments, the lack of quality control, the irrational decisions, the lack of strategies for innovation and updating of science and technology applications and the excess of bureaucracy in the introduction of measures that could bring about  rational alternatives to supply and employment.

Why there should be so many difficulties to apply a Payments Resolution.?  Is it logical than a seller, be it the State or a particular person, should receive over a one hundred and twenty percent profit on the sale of a given article?  What has happened to those who received land to cultivate and have not put them yet into production after many months or years?

To speak about these issues is also to speak about prices and in most of them we could reach the conclusion that among the group of excuses -- such as the US Blockade of Cuba, the hardships of indebtedness, the climatic adversities and  the hostility of the world economy -- that it is not a matter of prices, but of values, those that must be at all times present in the human beings.


Isidro Agustín Fardales González


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