Post by account_disabled on Mar 9, 2024 23:16:21 GMT -5
The Government and I am here to help”. In one of those iconic outbursts that would do so much to the popularity of his presidency, Ronald Reagan called these eight words as the most terrifying in the language Englishwoman. But beyond the shrillness of that supporting actor blessed by fate, the expression contains a truth that insistently whispers in our ears that the road to hell is paved with good intentions. Altruism, that generic inclination of the species to help the other, is part of our evolutionary nature, although it is conditioned by the brake of reciprocity. But when someone else pays the bill, we step on the accelerator. And when the driver is a politician whose main incentive is to remain in office, there is no speed limit that cannot be crossed in this wild race to add another notch to the blazon of solidarity. And although it is still in relatively good health, solidarity has been showing signs of exhaustion for some time now, of a senescence worn by use, of a glow that shines illuminating its darkest side. There is also a perverse moment in solidarity that appears when the equation that distributes the costs shows a negative balance in the income statement.
The current regulations that regulate the popularly known as "second opportunity” or more technically exoneration of dissatisfied liabilities (EPI), is a paradigmatic example of how legislation designed to help those disadvantaged who have been trapped in a spiral of debt, often the unforeseen consequence of an unexpected misfortune, has become a fraudulent instrument that generates perverse incentives, that favors the proliferation of irresponsible financing and that enriches a minority that has professionalized a kind of usurious business. The cancellation of the accumulated debt in situations of insolvency seeks to reincorporate into the circuit of economic activity all those who have USA Phone Number been temporarily displaced by virtue of supervening circumstances that are largely beyond their control (economic crisis, unemployment, etc.). It therefore has an easy macroeconomic justification: in the medium term it should increase activity by incorporating idle resources into the system. And from the social point of view Aid to those most in need is always an extraordinary political sounding board, a formidable echo chamber that no one who wants to survive in the electoral competition will ever dare to question. Problems appear when we descend the steps that lead to the details.
The market is an extraordinary resource allocation mechanism, but its proper functioning requires a legal basis that guarantees proper compliance with obligations and contracts. It is also, a complex system and when distortions occur in the value chain the effects are rarely linear and difficult to measure and quantify. And this is precisely what has happened with the legal regulation that exonerates unpaid debts. The economic agents that operate in the market detect the cracks in the system with much greater precision and speed than the regulation that tries to cover them up. When a door is opened and rigorous control is not established, we run the risk of meeting all kinds of undesirable passengers. Unsurprisingly, the unwanted side effects have far outweighed any benefits that could be gained. In the first place, there has been an extraordinary increase in the demand for insolvency applications in order to obtain the exoneration of liabilities. The number of bankruptcies has multiplied to the point that today they constitute more than seventy percent of the activity of commercial courts. In some casos, more and more numerous, it is observed that insolvency is purely artificial, a mere appearance created exprofeso to obtain the benefit of forgiveness since the liability is iscaso and, in everything caso, perfectly manageable with the income obtained.nsequence of the design of the structure.
The current regulations that regulate the popularly known as "second opportunity” or more technically exoneration of dissatisfied liabilities (EPI), is a paradigmatic example of how legislation designed to help those disadvantaged who have been trapped in a spiral of debt, often the unforeseen consequence of an unexpected misfortune, has become a fraudulent instrument that generates perverse incentives, that favors the proliferation of irresponsible financing and that enriches a minority that has professionalized a kind of usurious business. The cancellation of the accumulated debt in situations of insolvency seeks to reincorporate into the circuit of economic activity all those who have USA Phone Number been temporarily displaced by virtue of supervening circumstances that are largely beyond their control (economic crisis, unemployment, etc.). It therefore has an easy macroeconomic justification: in the medium term it should increase activity by incorporating idle resources into the system. And from the social point of view Aid to those most in need is always an extraordinary political sounding board, a formidable echo chamber that no one who wants to survive in the electoral competition will ever dare to question. Problems appear when we descend the steps that lead to the details.
The market is an extraordinary resource allocation mechanism, but its proper functioning requires a legal basis that guarantees proper compliance with obligations and contracts. It is also, a complex system and when distortions occur in the value chain the effects are rarely linear and difficult to measure and quantify. And this is precisely what has happened with the legal regulation that exonerates unpaid debts. The economic agents that operate in the market detect the cracks in the system with much greater precision and speed than the regulation that tries to cover them up. When a door is opened and rigorous control is not established, we run the risk of meeting all kinds of undesirable passengers. Unsurprisingly, the unwanted side effects have far outweighed any benefits that could be gained. In the first place, there has been an extraordinary increase in the demand for insolvency applications in order to obtain the exoneration of liabilities. The number of bankruptcies has multiplied to the point that today they constitute more than seventy percent of the activity of commercial courts. In some casos, more and more numerous, it is observed that insolvency is purely artificial, a mere appearance created exprofeso to obtain the benefit of forgiveness since the liability is iscaso and, in everything caso, perfectly manageable with the income obtained.nsequence of the design of the structure.