The inequalities and impoverishment in 1995/2018 are
evident and are shown differently among the countries on the Mediterranean
coast more or less scrutinized and intervened by the institutions of
European/global capitalism; mainly ECB, Eurogroup, European Commission and, IMF
Summary
1 - How
to manage an aviary
2 -
Important indicators of social regression
3 -
Comparison between the victims of the Troika
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1 - How
to manage an aviary
The monopoly of state control by the
political class is an instrument for the reproduction of the political class
itself, of continued support to companies - especially the largest ones - and
also, a factor of segmentation and social stratification. The
fragmentation of the fiscal punishment - pointed out, as a rule, as just - even
when regressive - burdens, above all, the lowest income; sometimes
the costs of collection and control of tax evasion exceed those of potential
collection, which the political class classifies as a policy of… tax justice.
While
income from work is scrutinized by the State, within the framework of its
osmosis with the financial system, income from capital is the subject of
various and creative instruments for tax reduction, for non-declaration of
potentially taxable income, for the use of offshores, of accounting as
business costs for elements of private-use - vehicles, travel ...
Social
segmentation and the use of regressive policies for the realization of fiscal
plunder are open doors for the widening of inequalities. Note, for example, the
use of the maximum VAT rate (23%) in the consumption of electricity, imposed by
the Troika and which continues to calmly burden all households, even though
about six years have passed over the ostensible presence EU / IMF zealots. On
the other hand, Law 12/2008 of 2/26 abolished meter rental fees; but, shortly
after, the chambers and the water and electricity suppliers invented other
names to maintain a juicy recipe that, in the case of electricity, is called
"power rate". How much does it cost for public hospitals to be
underfunded and poorly managed so that private ones, in the context of
celebrated partnerships, have more and more users?
Thus,
the fiscal punishment is masked in the form of taxes stripped of class-based,
neutral prejudices, presented as shaped by technical aspects that mask all
machinery aimed at guaranteeing and expanding capital accumulation to the
detriment of the common population, especially those who live. of work. To this aim, it is necessary to make precarious, unstable, reduce the purchasing power
of those who work and make this mass of people competitive, just as it happens
with chickens, which are struggling, whenever the time comes for the
distribution of the feed. The feed is carefully measured so that the chickens
produce a volume of meat, increasing per unit of time or, produce a maximum
yield (meat) per unit of feed; as in an aviary, workers have no name and still
lesser rights.
This
harsh reality is defined by the think-tanks hired by the transnational
corporations and by the financial system and, presented for publicity and
commercialization by the political classes, by the managers of the State
apparatus, with a greater or lesser show to (a) regret, after the formals have
passed. routines of social concerts.
2 - Important
indicators of social regression
In capitalism,
it is intended, naturally, that the function of work, of those possessing the
ability to generate wealth, should include assistance in forwarding this
additional wealth to the owners of the means of production (the capitalists)
and to the State, which, in turn, will be in charge of using this surplus in a
manner appropriate to the perpetuation of the capitalist system; now,
benefiting the accumulation of wealth in the holders of the means of
production, satisfying the multitude of non-capitalists, to maintain or buy
their passivity, essential for the system's perpetuity. Of course, it should be
thought that partition this surcharge in more general terms, it is necessary to
pay due attention to the demands of non-national capitalists, the global financial
system, the indigenous political class, etc; a partition that depends on the
degree of subservience of governance, the softness of and opposition, which is
deeper in the case of geographical areas which are mere s runners crossed the
logistics networks of multinational and where there is efficient service laundry money.
Taking
statistical elements (Eurostat) for the 1995/2018 period, for the various
European countries, it is interesting to compare the evolution observed in that
period, for four major financial flows: central government expenditure, VAT
revenue, revenue taxes on income and property and the remuneration of employees.
Governments and political classes collaborate in
collecting the tax burden from the general population, taking into account the
non-penalization of companies and so-called entrepreneurs, because they are the
ones who create jobs and wealth… bla, bla, bla; and they will contemplate… the
enormous and well-known humanitarian concerns, always attentive to the turning
towards “green” since that don’t affect the accumulation of capital. Obviously
...
Thus,
public expenditure - here, restricted to that of the central administration of
nation-states - must necessarily increase, as is the prerogative of economism, focused and dependent on growth; or rather, a
diffuse interweaving of mutually feeding variables (GDP, profits, taxes,
investments, consumption, income, sales ...) which is, consequently, also valid
for municipal administrations or, of specific devices, such as Social Security.
The
public expenditure includes the need to support and encourage investment, to
maintain a mild or tolerable tax burden for companies, subsidies, benevolent
legislation so that the capital will be attracted or, do not move to where the
risk and the tax burden is lower or even, null. Conversely, for competitiveness
to remain and for foreign investments to enter a country, labor legislation
penalizing those who work, low wages (competitive, as they say) and appropriate
qualifications are required. In short, all the advantages for the capital, all
the burdens for the work, having as express, formal and synthetic objective,
the growth of the enigmatic GDP.
State
expenditure is fueled, essentially by taxes and the use of debt. It is known
that the former is extracted from the population without any defined
consideration - it is an exception - and the use of debt immediately generates
the obligation to pay interest and, in the long term, a repayment. It is not
difficult to see that the exaction is much more favorable for governments than
the use of debt. All state machinery or, better, a real artillery - tax
apparatus, executions, seizures, fines, retentions and immense data crossings
that search the lives of the least favored population are imposed on those
forced to pay taxes. However, governments are tolerant of capital movements abroad or through intramural tax benefits, either by
building formulas that do not prevent capital transfers to offshores or,
creative formulas to dissipate the traces of fraud and the perpetration of
financial crimes. or the laundering of mafia activities and their interpreters.
At the
outset, it is not easy for a nation-state to cancel a debt it has incurred
without the creditor's consent. Similarly, nation-states incur debt, interact
with the global financial system for that purpose, without giving any
information to taxpayers about the application of the borrowed capital; but,
taking for granted that the population will bear the cost of this new debt,
without questioning and, above all, without even having a sense of what
happens.
The
proceeds of the loans are placed in a bottomless pit or diluted in the immense
machinery that constitutes the state apparatus. Governments act towards the
bulk of the population, like despots, without obligations to their subjects.
The
graph below shows the evolution (1995 = 100) of salaried wages compared to VAT revenue, income and property taxes and central government
expenditure. For the assessment of policy makers for the situation, we
have added below a table with the dating of governments during the
aforementioned 25-year period.
The division of
responsibilities by the various government gangs
1995 / Apr 2002
|
PS
|
Guterres
|
Jun 2011 / Oct 2015
|
PSD / CDS
|
Passos
|
Apr 2002 / Mar 2005
|
PSD / CDS
|
Durão / Santana
|
Oct 2015/2018…
|
PS
|
Costa
|
Mar 2005 / Jun 2011
|
PS
|
Socrates
|
|
|
|
Despesa da Adm. Central - Central Administration Expenditure Receita IVA - VAT revenue
Receita - impostos rendimento e propriedade Revenue - taxes on income and property
Remuneração
assalariados - wages of salaried workers
In more
detail, it can be seen that:
·
In Portugal, the
anti-social policy of all governments in the period 1995/2018 is clear: VAT
revenue doubles in 1995/2004 -05, there is an identical doubling for total
income and property taxes (1995 / 2006 -07 ) and State expenditure (1995/2007
-08 ). However, the total wage earners have only doubled their income after more
than twenty years (1995/2017);
·
The total wages of
salaried workers grew steadily until 2008, in the middle of the Socrates
consulate, stagnated until 2010, falling the following year, when the famous “engineer”
left (temporarily) the scene;
·
Passos welcomed the Troika
intending to go beyond the Troika itself; and starred in wage cuts,
freezes, redundancies, increased tax burden and, other rascals, flattening the
ground in 2015 for Costa to enter the scene, ahead of the fabulous contraption;
·
It should be noted that
the volume of salaried employees only in 2017 reached the level of 2010; and
that in 2012 it was at the same level as 2005;
·
The VAT revenue is
the bone structure of tax revenue because it is almost neutral for businesses
and brutally burdens the working population, with a high portion of income
applied in consumption, which is extensive and severely burdened by VAT; which
reveals the role of the state apparatus in the plundering of the product of labor.
VAT grows regularly over the government s Durão / Santana with a rise of 17% to
19% in June 2002; it has increased from 19% to 21% four months after the
beginning of the Socrates consulate in March 2005; and, finally, it stands at
23% on the first day of 2011, still under the baton of Socrates and his
minister Teixeira dos Santos; what Passo s e Costa, conveniently kept iv and
were contented with, quibbling miserably about the reduction of some crumbs in
the rate that affects electricity consumption - and that in the end, even that
didn't happen;
·
However, even in the time
of Socrates, VAT revenue stagnates in 2008 and undergoes great variations,
presenting in 2011 values not very distant from the collection of 2007/8. In
2011, raising the rate to 23% does not prevent a visible fall in state revenue
from the tax, taking into account the period of falling income and consumption,
following the application of the dictates of the Troika;
·
As of 2014, VAT revenue
evolved very significantly, allowing Costa and Centeno's financial brightness,
tripling in 2019, its value compared to 1995. And, as can be easily seen,
widening the differentiation of the evolution of the revenue of the VAT and
labor income;
·
Following the previous
point, it is revealing of the antisocial nature of the regime that VAT revenue
triples in a period almost equal to that in which labor revenue has only
doubled. The antisocial character of the post-fascist regime, in all its
splendor, is consistent with the reactionary nature of the dominant part of the
political class and the conservatism and ineffectiveness of union institutions
or so-called left parties, objective accomplices of the punitive character of
politics established decades ago;
·
In the section of taxes
on income and property remains a more marked growth than the remuneration
of employees exception of the years 2003/2005, a period that fits all,
practically, within Durão / Santana governments;
·
Since 2006, the evolution of this group of
taxes has strong growth, with some parallelism face to registered for VAT and, in the dynamic
more detached than the checks of with labor income;
·
The Troika and its
dual houseboys Passos/Portas promote, in 2013, a huge increase over the
previous year (about € 4,100 M, 29.3% up compared to 2012). 2013 revenue
remained at the same level until 2017 and, already in the Costa era, there was
a reasonable increase in 2018, which was more moderately replicated in 2019/20;
·
As observed for VAT,
taxes on income and property consolidate in the post- Troika growth
markedly higher than the evolution of wage income. Clearly, in the wake of the
2008 financial crisis and the intervention of Troika - with the
subservient obedience of the Portuguese political class as well as the stagnant
union structures - a social environment was created leading to a greater
precariousness in the lives of those who do not belong to the political
oligarchies and economic - workers, unemployed, retired, young people ...
·
The central government
expenditure accompanying the march of labor remuneration to 2002,
surpassing the whole of last thereafter, especially after 2009. It follows for
the rest of the period, one increases evident cycle at the end of Socrates
consulate (200 9 /2010), followed by an increase Another significant co m
monitoring the Troika steps of operation (2012- 2014), with the
intermediate break that placed 2012 expenditure at the level of four years
earlier. There follows, in the Costa management, a period tending to reduce the
bumps that strongly characterized the previous period; however, despite the
“excellence” of the magician Centeno, state spending in 2018 is at the level of
nine years earlier.
·
As is evident, so much
restraint, there was nothing virtuous about it. It reflected the imposition of
salary stagnation in the civil service; the degradation of the NHS - along with
the growing delegation to the private sector, especially the well-known
public-private partnerships; the mess of teacher teaching placements; unlike
what happens with the armed forces, at the service of NATO although, without
the capacity to defend the territory, if it were to be attacked; a perfectly
useless presidency of the republic, which shone one ignorant till 2015, has
been succeeded by an issuer of frequent vacuities, such Marcelo Rodrigues
Thomas or Américo Rebelo de Sousa, who understand the differences between the
former fascist regime and the post-fascist of nowadays; social security more
geared to forgiving corporate debts, financing patronage as clever as ignorant,
than to improve the lives of pensioners; a judicial apparatus where everything
is jammed up, waiting for a prescription, especially when it stumbles with
great figures of the kleptocratic regime.
3 - Comparison
between the victims of the Troika
We
include in the designation “victims of the Troika” countries like Greece and
Portugal where in fact, the formal intervention took place and with rigor;
countries, such as Spain and Italy, where this intervention was less formal or
invasive, taking into account the political, demographic and economic
dimensions of these countries; and, excluding Ireland, where its financial
difficulties resulted only from the rescue of Anglo- Irish Bank, whose losses
were quickly incorporated by the Irish State.
Behind,
we incorporated a graph that, for the period after 1995, shows the evolution of
global elements for the Portuguese economy - state expenditure, VAT revenue,
revenue from income and property taxes and also, for the global volume of
remunerations of work. Then, we will observe, for the five countries mentioned
above, the comparative evolution for each of the aforementioned economic
quantities.
Relating
to government spending, Cyprus stands out from the beginning, with a
unique and uncontrolled growth in the context of a depositary country of enormous
mobsters capital or, if you prefer, a laundry.
For the
rest, the regularity of the evolution of Italian public expenditure stands out
(it grew only 56% in 1995/2018), in contrast to that of other countries; Italy
was far from reflecting the failures of the financial system in public
management, which are visible in the rest - Greece, Portugal and, Spain. In the
latter, it is worth noting the great growth in public expenditure until the
emergence of the financial crisis, but less explosively in the case of Spain,
which is followed by a period of strong deceleration which, in the last year
considered, shows not only the irregularity of the level public expenditure,
such as the fact that it is below the levels reached before the peak of the
crisis. The social and financial costs resulting from the growth in debt are known and, above all, felt.
In the
case of Greece, the state's expenditure is, in 2018, at the level recorded in
2003, which shows the huge flow of cuts, as well as the drop in the standard of
living of the Greeks. In Portugal, the level of 2018 approaches that of 2009,
which is not yet observed in the case of Spain.
In
general terms, Cypriot state expenditure has grown 3.7 times since 1995,
followed by Portugal 2.2 times, Spain 1.9 times, Greece with an increase of 70%
and Italy, just over 50%.
We
continue with a similar approach for VAT and the same countries. Again,
Cyprus appears with values that are gradually different from the rest of the
countries included in the graph, from the beginning of the century. Thus, VAT
revenues, in the Cypriot case, in 2018, were 6.4 times higher than in the
standard initial year (1995), against 3.3 times in the case of Spain, 2.9 times
for Portugal and 2.5 or 2.4 times, respectively for Greece and Italy.
After
regular and similar growth until the beginning of the century, with growing revenue,
particularly in the Spanish and Greek cases, VAT revenue is placed (2007) at
values close to 2.7 times that recorded in 1995. In that period, Portugal has
less dynamism and Italy demonstrates its relative regularity also in the growth
of VAT revenue.
In the
graph, in 2007/09, the negative impact on VAT revenue, in all countries, is
evident, with particular highlights for Spain and Portugal, in the latter case,
the contraction induced by the Troika is evident; as of 2012/13 VAT revenue is
rising, with a more pronounced and parallel tendency for Iberian countries. In
2013, Greece places VAT revenue at the level of 2004 and, even in 2018, the amount
is still close to that of 2006. Spain and Portugal successively achieve the
highest volumes ever, from 2014 and 2015, respectively.
Value Added Tax (VAT)
In the
chapter on income and property taxes, the relative regularity of their
evolution in Italy is underlined, which was only changed between 2006/2008 and
2017 through more notorious additions; all of this in a plan to double revenue
in 2018, compared to 1995.
All the
other countries considered show abrupt and violent changes in the levels of
revenue from income and property taxes.
Cyprus
shows a huge increase, almost a doubling of revenue between 2004 and 2008,
following a notable drop between 2002 and 2004; although with sudden and
significant variations, Cyprus presents the highest level of progression of
these taxes, among the countries considered.
The
revenue growth shown by Greece is very marked, tripling its value in 2009 or
2012 compared to 1995; and that the Troika's performance will certainly not be
strange. As of 2015, the level of these tax revenues stabilizes at around 2.5 /
2.75 times the level of 1995, with Portugal as the company that reached this
level in 2013, during the supervision of the Troika, with increases in
the last two years.
Finally,
Spain has one of the lowest rates of progression until reaching, in 2007, the
value of 2.5 times compared to 1995, followed by a sharp drop until 2009. At
the end of the period, Spain shows itself as the country, of this set, with the
lowest rate of growth of the set of taxes on income and property (75% more than
in 1995); it should be noted that Spain resumed in 2009 the level reached in
2004 after reaching an intermediate peak of growth.
Taxes on income and property
Labor wages
evolved in parallel until 2001, with the difference between then being the
great rise in Cyprus for a decade and other increases, less marked in the cases
of Greece and Spain, situations that involute, respectively, in 2010 and 2009.
Labor wages
The
breaks that followed are very uneven. In Cyprus, the volume of wages at work
goes from 3.1 times the 1995 level in 2011 to 2.6 times three years later, in
the aftermath of the financial crisis; from then on, the volume of
remunerations rose significantly, reaching a level slightly lower than in 2012.
Greece
has the biggest drop in total wages for work; these corresponded, in 2009, to
2.75 times the value of 1995 and, only 1.9 times in 2016, the indicator growing
again, since then, which has not happened since 2009.
In
Portugal and Spain, the moments of the beginning of the decrease in the
totality of work remunerations took place, respectively, in 2011 and 2009; the
period of decrease in the mass of remuneration in Spain was four years
(2009/2013), against only two for Portugal (2011 and 2012). It should be noted
that there is perfect parallelism in the evolution of the total wages of the
two Iberian countries, from 2010 as it had been happening until 2002.
Italy,
with a steady evolution until 2011, stabilizes at this level until 2016, after
which there is a growth in the wage bill, placing itself with a dynamic similar
to that observed for Greece and, slightly below that registered for Portugal.
(to be
continued)
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