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The result of an antiquated law
La Nacion
January 07, 2010

Miguel Pichetto
for LA NACION

The crisis in which Martin Redrado is seeking to sink the national government with his attitude has its roots in the Argentine economic past, which fell into a grave crisis in 2001.

What is happening today confirms that the country is suffering through an obstacle from legislation that undoubtedly should have fallen away with convertability. It's necessary to think of reforming the charter of the Central Bank, Lo que hoy ocurre confirma que el pa s sufre una r mora propia de una legislaci n que indudablemente deber a haberse ca do con la convertibilidad. Es necesario pensar una reforma de la carta org nica del Banco Central, since it gives it prerogatives that are not coherent with the autonomy that every democratic government should have. Said in another way, it's essential to remedy the current situation in which the Central Bank, whoever its leader, can place itself outside and, as happening now, in opposition to the decisions of the Executive Branch. That this is occurring is effectively a mistake.

The actions of the Central Bank have to have an anchor in economic policy that the national government defines for the country. Consequently, it becomes essential to think of reforming the charter of the bank. In the same way, it's equally necessary that this institution be in the hands of people that believe in a solid technical formation and proven capacity for the primordial task that they should carry out: the care of the monetary reserves of Argentina. But that means that its president and board of directors develop this function in line with the country project of the government democratically elected by the people, and not against it.

The crisis that, with his attitude, Redrado is promoting was seen coming. Thus we in the government block in Congress expressed ourselves last week, on the creation of the Bicentennial Fund. And it is truly regrettable that some officials, as in this case, plan not to be a part of the national government when they should be making complex political decisions.

It's key and urgent to debate the main issue, that goes beyond the names, and what should be taken up is the subordination of a key institution like the Central Bank to the national economic policy, an institution that cannot act backwards or against the democratically elected government. In fact, with his attitude, Redrado puts in question the authority of the President, which constitutes a very complicated high wire and could have destabilizing consequences.

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