Former director of the Central Bank, former president of BNDES and one of the creators of the Real Plan, economist André Lara Resende launched on Tuesday (23), at Unicamp, his most recent book, "Ideological Straightjacket: The macroeconomic crisis".
In a radical perspective, Resende maintains that the logic of conventional macroeconomics restricts the financial power of the State and, as a result, ends up benefiting the financial system. According to him, macroeconomics has become a prisoner of an ideological straitjacket, having constructed a perception of the country, the economy and the organization of society that presents itself as scientific, but which, in reality, is a mistake.
"[This] is a very restricted formula for organizing society, organizing it around the interests of certain sectors, especially for the benefit of the financial system, of those who participate directly in the financial system", said the author, in a seminar held at Zeferino Vaz auditorium, from the Unicamp Institute of Economics.
Resende stated that there are critical points in macroeconomics that need to be reviewed, or even reconceptualized. And he said, for example, that public debt is the counterpart of private financial wealth.
"The national state - currency and debt - It is the accounting of the rights and duties of society. This accounting is managed by the State. And when the State issues debt - whether in currency or in debt –, It is a liability of the State and an asset of the debt holder. Who holds this debt?" he asked. "The private sector," he replied.
"Therefore, if the State were to fully redeem its debt, if it would have surpluses taxes that put an end to public debt, the inescapable result would be a dramatic reduction in the wealth of the private sector", he argued. "It is very curious that all defenders of the idea that the State must have surplus, that public debt cannot increase, these things, do not understand this logical, irrefutable element: if the State starts to have surplus system, and begins to redeem its debt, the private sector becomes impoverished. At least in terms of financial assets," he assessed.
Financial capitalism
The economist also said that, in the last 40 or 50 years, Brazil has dramatically frustrated expectations regarding what could be expected from a country with the potential that exists here.
"I at least thought that, once we had overcome the problem of inflation in Brazil, which seemed to be an extraordinarily difficult problem to overcome, we could finally dedicate ourselves to Brazil's atavistic problems, of income inequality, poverty, social exclusion. But That's not what happened," he said. "Brazil has improved in some aspects, but it continues to struggle. In a way, the country is in a quagmire," he said.
The author recalled that capitalism has always been financial, but that, in recent years - in the last four or five decades, according to him –, A markedly financial capitalism was implemented, and this is because the proportion of financial assets in relation to income exploded.
According to Resende, this financial capitalism currently exercises great power over public policies and the possibility of reversing them. "Where does this come from? It is what is conventionally called the neoclassical, or neoliberal, vision of the economy. This has become the dominant hegemonic vision, which in a certain way excludes and prevents its criticism," he said.
"It turns out that this vision of the economy, which today governs analysts, the media and the definition of the technocrats themselves responsible for establishing and implementing public policies, is essentially based on neoclassical economics," he stated. "This is the economic theory taught in schools mainstream. And it is this economy, especially macroeconomics, that presents itself as science and which, most certainly, is not science", he added. "The economy is an ordered set of ideas about human activity and, in this sense, it is inevitably ideological. But it aims to be completely non-ideological", he pondered.
Dysfunctional economy
Resende said that the economy, especially monetary theory, it became dysfunctional and ended up being unmasked after the financial crisis in advanced countries, which occurred in 2007/2008. And now, he added, economists, especially central bankers, find themselves without a conceptual framework that can tell them how to act.
"The vast majority of them (economists), especially central bankers, already know this, but it's as if they were saying: We know, but we can't reveal it. How can you reveal that you have gigantic power in your hands, but you don't have it? any idea what to do with it?" asked the author.
This, according to him, is generating a curious situation: the macroeconomic paradigm of the 20th century has become anachronistic and dysfunctional, but there is no other to replace it. "I don't like repeating a phrase that has been repeated a lot, but it's that situation: the old has died, and the new has not yet been born. This phrase fits perfectly into today's moment, in several areas, but especially in relation to macroeconomics", concluded
