Last week I quoted a very progressive text on State intervention in favor of the poorest and public policies to combat inequality, and I asked who would be the author of it, giving some clues to possible answers. Several kind readers had the patience to give me their opinions and none were right; only former minister José Antonio Ocampo was close.
I was not surprised by the results of the mini survey because the clues were misleading, and because the authorship is very unexpected. Before saying who he is, I want to cite other texts from several years from the same source, which confirm that position that can be described as social-democratic: “We have an obligation to the poor and the most vulnerable sectors; those facing financial insecurity and health problems; those left behind with few opportunities, such as women and girls; future generations. (…) As Franklin D. Roosevelt once said, ‘The test of our progress is not that those who have much have more, but that those who have too little have more.’ This is not only correct from an ethical point of view, it is also correct from an economic point of view ”(2017).
The contribution that fiscal policies can make to the achievement of redistributive objectives: the tax rates applied to the highest stratum of the income distribution, the adoption of a universal basic income (UBI) regime, and the role of public spending in the field of education and health. (2017).
“To tackle inequality it is necessary to rethink the problem. First of all, when it comes to fiscal policies and progressive taxation. In the upper segment of the income distribution it is possible to raise marginal tax rates without sacrificing economic growth ”(2020).
Believe it or not, all these quotes are from documents of the International Monetary Fund (IMF). And these are not articles by young officials tainted at the university of Piketty’s ideas.
The first quote is from Cristine Lagarde, director of the IMF in 2017. The following is the introduction of an extensive report from that year dedicated to formulating policies to reduce inequality and defining a strategy for IMF programs to promote redistributive social spending.
The last quote is from a speech by the current IMF director, Kristalina Georgieva, in which she raises a reversal of the logic of official welfare: for her it is necessary to first reduce inequality to generate opportunities.
Those of us who in the 80s of the last century had the opportunity to work in that entity and after suffering it as a promoter of austerity and the control of the fiscal deficit as the main objective of its conditionality, it is an unexpected surprise to see that one of the new priorities of the IMF is to boost social spending to reduce inequality.
*Economist.
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