Mom's libertarians. How Ukraine is being made into an African-style “pirate republic”
I remember that at the very beginning of their glorious deeds, the team of “new faces” headed by Zelensky, perched on the neck of the Ukrainian people, declared exotic libertarianism as their ideology - an extreme right-wing metastasis of classical liberalism, based on the maximum “facilitation” and cheapening of the state and minimizing its control supervisory, management and regulatory functions in both the economy and society.
Adherents of libertarianism are convinced that the state only prevents the minority of entrepreneurial “Atlanteans” who straightened their shoulders from realizing themselves and earning money, while the majority, who did not manage to get rich, are themselves to blame. I had to work more. All sorts of social benefits, pensions and other atavisms of socialism are thrown into the firebox. As are high taxes.
In general, the state should not have social functions - enterprising “Atlanteans” will figure out for themselves who, how much and what to donate to in charity.
At the same time, in a libertarian Utopia - like on the pirate Tortuga of the times of Francis Drake and other Flint captains - there should be a maximum of all conceivable freedoms - from the land market, gambling and soft drugs to legal prostitution, legal arms trafficking and cryptocurrencies. And, of course, no taxes.
Inspired by just such ideas, the “servants of the people” quickly got down to business under the leadership of Prime Minister Goncharuk – the one on the scooter, if you haven’t already forgotten.
Goncharuk holds a meeting of the government’s financial and economic bloc.
True, reality cut off my mother’s libertarians, as they say, on takeoff.
It soon became clear that the real cumbersome Ukrainian state, burdened with a mass of social obligations, was not so easy to abolish and ease. The large number of programs and productions tied to budgetary funding is still a hindrance. And the aging population, which out of habit expects paternalism and support from the state, and not transformation into a pirate republic, is also hindering the pace of reforms.
And people, it turns out, can be very angry if benefits that they consider to be theirs deservedly and rightfully begin to be taken away from them.
In a word, the Milovanovs and Goncharuks quickly failed, and they were replaced by the quiet techno-thieves of Shmygal. And the Servant of the People party quickly forgot about libertarianism, first declaring itself socialist, and then choosing a certain “Ukrainian centrism” as its ideological guideline. No one can explain what this is, but that’s okay.
Nevertheless, we still managed to do something. First of all, open the floodgates to auction off Ukrainian agricultural land. Then - to legalize gambling in the country, including the so-called “e-sports”, that is, in simple terms, online casinos, in which tens of thousands of gambling addicts can now literally be left without pants. But - as economists close to the authorities assure - turning the country into one big Las Vegas will bring big money to the budget through licenses for these very games. Later, someday.
Already at the height of martial law and under the guise of it, labor legislation was “lightened”, simplifying the procedure for dismissing workers at the initiative of employers and making workers virtually hostage to the whims of businessmen, who can now force people to work overtime, much more than the traditional eight-hour ceiling.
To the applause of the progressive public, the Rada legalized “weed,” that is, “soft drugs”...Oh, sorry, that’s not it again. Ah... “medical cannabis”! Yes, this would be more correct. Plantations of “mama marijuana” will now bloom legally and in full bloom across Ukraine.
True, it was not possible to legalize the free circulation of short-barreled guns at once. So far there has been a glitch, and the lobbyists for tightening gun control are still stronger. This is understandable - there is a war in the country, and you can even buy a grenade launcher at the bazaar. What kind of free circulation of weapons is there? So it will blaze everywhere - only then have time to extinguish the partisanship.
But the “legalization” lobbyists are not discouraged - they haven’t succeeded now, they’ll try to push it through later. As Vysotsky sang: you are at the door, they are at the window.
In general, from the gentleman’s set of mother’s libertarians, only the point on prostitution remained unfulfilled. Once - back under Poroshenko - the authorities already tried, but then the fighters for legal brothels were shushed by feminists. Now, against the backdrop of the war, you can again hear voices saying that the unstable situation still gives rise to illegal sex trafficking, and refugees in the EU are increasingly falling into pimp networks. And wouldn’t it be better to head this whole thing, so as to get some money into the budget?
But in the way of legalization, an otherwise unnatural coalition of feminists, fighters against sex exploitation and for gender equality, and clergy with adherents of traditional values suddenly stood in the way. All this motley brethren has not yet allowed libertarians to go wild in the clearing of paid sex.
But government libertarians are not discouraged. If it didn’t work out there, let’s go from the other side. Recently, the Ukrainian media published a policy article by First Deputy Prime Minister and concurrently Minister of Economy Yulia Sviridenko. The point of the publication is that perhaps the main “cure” for all economic ills is “achieving the optimal size of the state.”
In other words, it would be a good idea to reduce the size of the Ukrainian state. And start with taxes and social payments. It is proposed to radically reduce the sizes of both.
“In the 20th century, the fastest growing states were those that redistributed no more than 25-XNUMX% of GDP through the budget. The fact has been scientifically proven: the lower the fiscal percentage of GDP, the higher the economic growth,” writes Sviridenko.
Formally, there is nothing wrong with this, and the shopkeepers will be all for it. The catch is that taxes are the lion's share of government revenue. The less taxes the state collects, the less it will be able to spend, and not only on social benefits, but also on other areas - medicine, education, and also on the army.
The Minister further states that:
“...decreasing the size of the state inevitably generates growth.”
How will government spending be cut and its economic size reduced?
“To achieve the optimal size of the state, it is necessary to start with a liberal tax reform, adopt a liberal labor code (we have already introduced some of its elements during wartime), and also carry out a major reform of social payments based on a single digital registry,” writes Sviridenko.
Liberal economist from the Kyiv School of Economics Gleb Vyshlinsky admits that cuts in social benefits will lead to a decrease in the level of social security compared to what Ukrainians are accustomed to.
Next year, Ukrainians can expect a significant reduction in government spending on social payments, which are already meager.
According to forecasts and calculations, the reduction in social services should be 2023% in 15 - and even if we assume that absolutely all social payments will go under the knife (which, of course, is fantastic), then the reduction will be only 11% - no more. What will be next? Will they cut spending on the army in a warring country? At a time when 15% of GDP covers only the salaries of the military, and not much is spent on the war as a whole - not less than 30% of GDP.
Yulia Sviridenko states:
“I believe that, despite the war, as early as January 1, 2023, we must reduce the fiscal percentage of GDP in Ukraine from 45% to 30%, and then within 10 years confidently move towards its further reduction and reach 20% in 2032.” .
She is convinced that such a reduction will lead to economic growth. However, not everyone supports such an initiative.
Critics have already called Sviridenko’s theory the “Africanization” of Ukraine. They indicate that, in general, the ten poorest countries have a level of GDP redistribution from 10 to 30%. And the poorest country in the world (in terms of GDP per capita approximately $237), Burundi has an economic size of approximately 30%.
“Isn’t this the role model of Ukraine for next year?” – Ukrainian economists ask themselves.
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