shirina476
Taczkowiec
Doczy: 06 Mar 2024
Posty: 1
|
 Wysany: Sro Mar 06, 2024 05:26 Temat postu: Reasonable profits, an AMLO utopia? |
 |
|
The president of Mexico, Andrs Manuel Lpez Obrador, has demanded on more than one occasion during his morning conference that the profits generated by companies in the country must be “reasonable and not excessive,” so as not to harm the national economy.
During this week that ends, the issue was also addressed by the President. When speaking about the approval of the Electrical Industry Law (LIE), he indicated that this action seeks to bring order to the sector and assured that he is not against private investment, but with reasonable profits.
“Yes, there has to be business in Mexico and there is no prohibition, there is no obstacle to investing and doing business with reasonable profits, no robbery, no stealing, zero corruption, influencerism disappears completely,” he said on December 18. February.
What is the President talking about?
The idea of regulating company profits is not new; In 2015, Nicols Maduro, president of Venezuela, promulgated his idea of putting a legal limit on profits through measures such as price control in the “Organic Law of Fair Prices”, which establishes that companies must have as maximum profit the 30% of the cost of your investment.
In Switzerland it was also Ecuador Mobile Number List discussed after the British politician David Milliband proposed that the rates that private energy companies charged citizens would be frozen if he won the elections in 2015, however the proposal was rejected by 65% of voters.
In 2019, Cristina Kirchner, former president of Argentina, proposed discussing the profit margins of companies in her country, since she considered that with the increase in rates for public services and concessionaire companies, only those that were linked to the government earned.
What do the experts think?
Marcelo DelaJara, director of the Economic Growth and Labor Market Program at the Espinosa Yglesias Study Center (CEEY), explained that the regulation of private gain does not exist in the history of any country; What there is in the United States and Europe are independent commissions and independent regulators who raise their hands if they see that a company is already taking over the market and thus regulate competition.
In an interview for Expok, he indicated that when someone talks about profits they generally refer to the company's profit, however, it is important to define that profit, because it is generally confused with income.
"The President is very imprecise about the profits going to a particular person, sometimes that is confused with the company's income and that is where the problem begins because income is the total value of sales and a company has many “Sales does not necessarily mean that it has a lot of profits, which is why the technical term is profits,” declared the specialist.
He explained that the income does not remain entirely with the company, since taxes have to be paid and the more profits a company has, the more taxes it pays; What remains will compensate what was invested and if there are not enough profits then it is not profitable.
“Demonizing profits in general makes no sense, because the economy works and grows because of the prospect of a profit and a return. The costs are subtracted from the income and we arrive at the profit or profit, when a company invests a lot in a sector, profitability drops, and therefore it is not possible for there to be large differences in profitability in sectors.
He added that monopolies do obtain extraordinary returns and the way to combat excessive profits is not through criticism, but rather by having very good regulation to promote competition, and for this there is the Federal Competition Commission (Cofede), an entity that should regulate that there is as much competition as possible in our economy, but that in the end “the President has been criticizing it instead of encouraging it,” he noted.
Very difficult to regulate profits
Alejandro Azamar, an academic at the National Autonomous University of Mexico (UNAM), said that this idea is erroneous because one should not think about “reasonable profits”, but rather about promoting free competition, thereby achieving greater production and fair profits for everyone. .
“The market does not allow you to regulate because each company has the freedom to have the profit it wants, nor is it a crime, nor does it have to be regulated. I don't agree with the President, from a market point of view it is very difficult to regulate profits,” he said in an interview for Expok.
He considered that in Mexico there is a need for many more entrepreneurs and it is necessary to change the role they have in society; “The highest percentage of jobs are generated by micro and small businesses, which in turn make up 90% of the companies in the country,” he said.
“We must therefore encourage greater investment in companies every day, which provides them with the products, services and adequate financing they require, especially with the arrival of the pandemic since some have not even made profits,” he added.
To achieve regulation, a specialized study is required by sector and type of company, with which it would be possible to know which ones are making excessive profits; “For example, right now with vaccines, they are companies with million-dollar profits and no regulation, which could mean a warning for society,” he noted.
He added that in the case of oligarchic companies, that is, when two or three companies control up to 80% of the market, it happens that they agree to define the price and what should be done is analyze which industries they dominate and promote the competition.
He assured that in the country it is impossible, due to the law of the market, to avoid enrichment and only one formula has been found: tax reform, charging more taxes and distributing the income first to the poor and then to those who are not poor, without This means sacrificing production.
_________________
Ecuador Mobile Number List |
|
POMOC
Szukaj
Rejestracja
Profil
Zaloguj si, by sprawdzi wiadomoci
Zaloguj
