Column by Clarisa Hardy: The fiscal cost of not having a new Constitution – La Tercera

A few days ago, a study was published with estimates of the direct fiscal cost of the proposed Constitution, between 8.9 and 14.2 points of GDP. Three reflections lead to the question of what would be the fiscal cost of not having a new Constitution (NC).

The first, to remember that the constitutional reform that enabled this process established that it would be from a blank page, except that the treaties signed by the Chilean State should be recognized. Among these, the International Covenant on Economic, Social and Cultural Rights, which is decisive for its incorporation into the contents of the current text to be plebiscitated and which has led to the aforementioned study of fiscal cost.

Said Pact enshrines in its article 2 the principle of “progressive realization”. That is, assuming the resource limitations of the states and then recognizing that there are hardly any rights whose full realization can be achieved in a short period, it is established that rights cannot be regressed and that their gradual progressiveness must be the basis that guides legislative decisions. and fiscal resources to the maximum possible.

This Pact is adopted as central content in the proposed Constitution. Thus, if until now the prevailing criterion is that fiscal resources determine the validity and progression of rights, with the new text it is the other way around, and it is the validity and progression of rights that should guide fiscal decisions.

A second reflection is the criterion for estimating the fiscal cost of rights. The Nobel Prize winner for Economics, James Heckman, demonstrated that for every US$1 invested in early childhood there are returns of up to US$17, avoiding later expenses in remedial health programs, prisons, police and the judicial system. The same should be studied for different stages of the life cycle. Leaving rights unprotected without adequate and timely social investments implies much more onerous subsequent fiscal costs. Proof of this are the high costs in health and care due to avoidable dependency in old age or the immovable figures of children and adolescents who annually pass through the Sename networks, many of them lawbreakers, for not having previously invested in Your rights.

Finally, for those who argue that rights cannot be financed without growth, the proposed text responds by promoting social cohesion as the main engine of development. As an example, gender equality cuts across the norms of the NC proposal. According to data from UN Women for Latin America and the Caribbean, if the current gender gaps in the labor market in the region were overcome, GDP per capita could be increased by 14%. If we do this analysis for the Chilean reality -citing a study by Clapes UC- we conclude that “each point of greater female labor participation translates into an increase of 0.5% of GDP”. That is to say, economic development is conjugated in the feminine and that goes through more rights and non-discrimination.

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Column by Clarisa Hardy: The fiscal cost of not having a new Constitution – La Tercera