As soon as the media released the news about the government's decision to discontinue the Consultative Group on Indonesia forum, the next days’ edition of the same media harbored comments from anybody who is somebody in the political and economic realms on the very issue. High time that the government made that decision. Politically it should count as a plus. It’s a brave move, an official release from the ministry of finance went on to say. In this post I’d like to use the momentum to share a bit on the unseen, as well as to *celebrate* my own comeback to the blogosphere. ;p)
At first blush, the decision to kiss the CGI goodbye would seem a bravado all right, except a nullifying remark from the minister herself that Indonesia would still resort to its three biggest lenders—which right away enjoy automatic leverage in terms of bargaining position.
Today is already the tragic tomorrow when effects of the policies committed in the near and distant pasts by the “know-all” government and its mighty lenders materialized in … complications. New policies, meanwhile, are in the pipelines, not to mention the ones being contrived as most Indonesians are still in the slumber land.
Back to the drawing board; with both the government and its lenders equally perplexed at the scantily meager results after the so much money has been thrown away, the decision then serves as a sort of point zero, from which the government and its lenders refresh stamina from near fatigue and past failures that can thus be ushered to the dustbin of history, reserved for antiquarians.
New officials come while old ones go. By nature, none of them can outlive the life of an institution called a state. For which mortals can go in debt forever and get away with it forever? Only a state, which can mortgage its land through borrowings to be paid through the nose by its citizens (even unborn ones).
Any discerning economist and citizen would notice there’s been no shift nor alteration whatsoever in our government’s paradigm and attitude in the decision. The heart of the problem has been the disastrous lack of understanding of what fiat money is and the misguided attitude toward deficit.
Practically every macroeconomics textbooks in the world says it is okay to have budget deficits. There is nothing wrong with them per se. In actual fact: even a single, one-time budget deficit that gets perpetuated is a disaster whose consequences are as necessarily certain as chickens would come out of chicken eggs.
And even if our government decided on a balanced budget starting today to infinity, the burdens from past deficits would haunt us for the rest of our lives :((
At first blush, the decision to kiss the CGI goodbye would seem a bravado all right, except a nullifying remark from the minister herself that Indonesia would still resort to its three biggest lenders—which right away enjoy automatic leverage in terms of bargaining position.
Today is already the tragic tomorrow when effects of the policies committed in the near and distant pasts by the “know-all” government and its mighty lenders materialized in … complications. New policies, meanwhile, are in the pipelines, not to mention the ones being contrived as most Indonesians are still in the slumber land.
Back to the drawing board; with both the government and its lenders equally perplexed at the scantily meager results after the so much money has been thrown away, the decision then serves as a sort of point zero, from which the government and its lenders refresh stamina from near fatigue and past failures that can thus be ushered to the dustbin of history, reserved for antiquarians.
New officials come while old ones go. By nature, none of them can outlive the life of an institution called a state. For which mortals can go in debt forever and get away with it forever? Only a state, which can mortgage its land through borrowings to be paid through the nose by its citizens (even unborn ones).
Any discerning economist and citizen would notice there’s been no shift nor alteration whatsoever in our government’s paradigm and attitude in the decision. The heart of the problem has been the disastrous lack of understanding of what fiat money is and the misguided attitude toward deficit.
Practically every macroeconomics textbooks in the world says it is okay to have budget deficits. There is nothing wrong with them per se. In actual fact: even a single, one-time budget deficit that gets perpetuated is a disaster whose consequences are as necessarily certain as chickens would come out of chicken eggs.
And even if our government decided on a balanced budget starting today to infinity, the burdens from past deficits would haunt us for the rest of our lives :((
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