Neither the COB nor the Government know what it means to produce | Ni la COB, ni el Gob saben que es producir

Editorial, El Deber:

Wage increase: hypocrisy and electoral calculation

President Luis Arce is in campaign mode. And his decisions are tainted by a desperate search for votes. The polls released so far show that his chances of re-election are minimal, and he knows it—just as he knows that the tools of power (decrees and resolutions) can help him appear more favorable to the popular electorate. Perhaps that’s why he announced yesterday the agreement for a 10% increase in the national minimum wage and 5% in the base salary. A statesmanlike vision? Not at all. Just political calculation of the kind that says “the end justifies the means.”

This year, more than in any other year of this government, the wage negotiations were held under lock and key. Behind closed doors and without involving those who actually pay the increases: the employers. They raised several alarms, because the national minimum wage is linked to variables like seniority bonuses, short-term social security contributions, nursing subsidies, etc. The private sector warned of the impact on production and, fundamentally, on the precariousness of employment. But none of that seems to matter to the COB unionists or the populists in government. After all, neither of them generates production or knows what it means to bear the cost of such a measure.

To demagoguery, we must add hypocrisy. Only two out of every ten Bolivians in the economically active population receive these wage increases. Eighty percent of the workforce operates off the books or in the informal sector. That means a large portion earns less than the national minimum wage, makes no retirement contributions, and has no right to vacations or severance pay, etc. The national government knows this and allows it. Just ask the cooperative miners how much they pay the workers who actually do the labor. Or ask the merchants and smugglers how much they pay a vendor or a porter.

Like a foreseen chronicle, the script of what’s coming is already known. There’s a wage increase for a few and no benefit for many. What there is, is a very high social cost for the companies that are forced to pay this benefit. Dozens of small and medium-sized businesses will be forced to shut down or at least lay off the few employees they have. The larger ones will stop hiring, or at the very least will no longer do so under labor law. So those most harmed are the poorest, contrary to what candidate Arce Catacora claims.

The head of government blames others for the current state of the economy. The “bad” deputies and senators who won’t approve loans; the blockades (even if they were last year); the war, tariffs, and any excuse that crosses his path. The president doesn’t realize that inflation and growing poverty are solely the result of his poor governance: bans on exports, tax suffocation of the few formal businesses, and a long list of other issues.
Obviously, none of this is mentioned when he puts on his candidate hat and approves populist measures to win votes.

The closure of businesses and job sources has clear culprits: the COB and the government through President Luis Arce. Is a wage increase enough to forget that this is mortgaging Bolivia’s future?

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