Piñera promises 7.2% of GDP for education trying to calm protesting students

Saturday, October 1st 2011 - 05:46 UTC

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The Chilean government proposed a 5% increase in public spending and a 7.2% gain in education outlays next year as it tries to end four months of protests that have seen a quarter of a million students miss classes and weekly battles with the police. Read full article

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GeoffWard2
This is, in many senses, a zero sum game of inputs having to match outputs.
If spending on social provisions is to increase so massively, then state income will have to increase by the same amount. The equation can be modified on both sides - eg. the state can borrow itself out of trouble, short-term; or it can generate bigger income surplusses from overseas trade - but, essentially, a bigger state spend demands bigger taxes and a wider tax-base.

So, anticipate a big crack-down on tax-evasion, and on the hidden (untaxed) economy, increase in administrative efficiencies like job-cuts and pension restrictions, full repayment of the costs of higher education by the graduates themselves, and more people captured in the tax-net.

These structural changes WILL take 5-10 years to fully emplace and bed-down, will span terms of office, and so will need the agreement-in-principle of both the government and the oppositions. This agreement is needed to reduce and remove street protest and street violence.
A return to governance through the practice of democracy is sorely needed.
Oct 01st, 2011 - 01:58 pm - Link - Report abuse 0
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