I've been asked countless times: why does the government commit the economic insanities that we see every day? Why is the Secretary of Domestic Trade, Guillermo Moreno, attacking entrepreneurs, closing the economy, and committing so many other such stupidities? Why is the Central Bank of Argentina destroying the currency? In short, what is the reason behind this destructive economic policy?

Answering this question is not that easy. Some explain it by ignorance while others attribute it to resentment. There may indeed be a mixture of those two factors, however, although it might seem surprising, I think the root of the problem lies in a lack of basic understanding of economics. The ideology of "kirchnerism-cristinism" [the policies of former President Néstor Kirchner and current President Cristina Fernández de Kirchner] views the economic process as a struggle for income distribution. In this view, if a sector has more earnings, it can be only because others lose out. They do not understand that in the economy everyone can win - as long as the State doesn't meddle in the economy, doing the absurdities it does every day.

This vision of the economy as a war is clearly seen in the official discourse. "They want to invade us with imported products! We have to defend the national production! Entrepreneurs have to limit their profits!" The whole discourse is in a tone of conflict, one which can only be solved by the "wisdom", "goodness" and "fairness" of the president. This means that if something good happens in the economy, it can only be thanks to those enlightened politicians doing justice through their policies, not because the people are efficient and competitive. No doubt part of this discourse may be due the populism of trying to win votes by claiming, "thanks to me, you, the outcast, have a better income." And when this discourse becomes more difficult to hold due to the lack of resources to keep the over-spending `party going, they are never going to accept responsibility for the blatant mistakes they made.

Everyone keeps denouncing hidden conspiracies intending to destroy the construction of a well-meaning project, embodied in one person. That's a part of the populist discourse, and who knows what its psychological foundations are.

In fact, the economy is not a war where some win and others lose. Yes, there is competition between companies to win the favor of the consumer. That competition consists in investing to sell the best products at the most convenient prices to win the favor of the consumer. This requires investment, management skills and creating value. Through this process of investment, new jobs are created that increase the demand for labor and push wages up.

At the same time, the more you invest, the more units are produced (increased productivity), thus lowering fixed costs per unit of production, goods and services are more plentiful and inexpensive and improve the income level of the people. But not because the companies earn less. Companies earn more because they sell more: even though the prices are lower and the quality better, their profit lies in the increased volume. The example I can give is that of computers: every year they have better processors, more data storage capacity, etc. while prices go down or remain stable. With cellphones, something similar is happening. Obviously I'm talking about the rest of the world, not Argentina where thanks to the import substitution model "entrepreneurs", which in fact are mostly courtiers of those in power, obtain privileges allowing them to avoid competing while harming consumers by selling products of lower quality and at higher prices than in the rest of the world. Just do a simple tour of the Internet sites to compare the prices and quality of the cellphones sold in Argentina with those sold in the US.

But the government doesn't see competition as a process by which entrepreneurs must invest and compete in order to win the favor of the consumer. Instead, it considers that competition doesn't work and that production, prices, wages and what to produce all have to be planned by an enlightened mind. Today that supposed enlightened mind is supposed to be the Secretary of Domestic Trade Guillermo Moreno, while at other times, it was supposed to be Bernardo Grinspun or José Bel Gelbard, or so many other finance ministers who believed that only the wisdom of the rulers could improve the income of the people against the greed of employers, while that "greed" is in fact supported by restricting the competition of imported goods. A case for psychiatrists, really.

Within this authoritarian view of economics, relying on the enlightened goodness of politicians, no room remains for the understanding of competition as a discovery process: to find out what people want, which prices they are willing to pay for each commodity and what product qualities they wish. Economic populism inhibits the capacity to innovate of the people and the current millionaires "entrepreneurs" are, for the most part, mere lobbyists who made shady fortunes thanks to their influences with corrupt officials. It is at this point that interventionism can no longer be considered merely inefficient, but must be recognized as fundamentally immoral, since corporate profits are no more born out of answering the needs of the people, but instead of robbing the pockets of the consumers. And since in order to rob them they need the approval of public officials, their agreement becomes an enormous corruption where wealth comes from plundering the people through corrupt pacts.

But since the populists aren't stupid, they start to forcefully redistribute income, trying to calm the masses by throwing them crumbs in the form of meager wage increases, while public officials and pseudo-entrepreneurs reap bags of money.

From a strictly economic point of view the much-maligned market economy is more efficient than populism and interventionism, since in order to progress the system inevitably requires the employer to support his workers with better wages and working conditions, while at the same time helping consumers, who only buy his products if he produces some quality goods at competitive price. It's not through benevolence that businessmen make money in a market economy, but through their efforts to win the favor of the consumers. Unlike the populist interventionism, in which fortunes are accumulated without investing by plundering consumers and workers, comforted by crumbs "graciously" thrown at them by the autocrat currently in power.

But besides being more efficient, the market economy's big difference with interventionism is that it is founded on moral and ethical principles, no one being allowed to obtain what doesn't belong to him. The State and its officials, with their monopoly on violence, are not used to pluck workers and consumers. Corruption is not made into a form of political action by which wills are purchased.

Therefore, and to conclude, the tragedy of peoples is that once populism is installed, society's values are changed, peaceful cooperation being cast aside in favor of arrogance, legalized theft, corruption, and living off other people as a way of life.

As you can see, we're not just talking about economic efficiency when we talk about capitalism versus populism. We are saying that the market economy is a moral imperative against the immorality of interventionist populism, since in the latter corruption and plunder prevail. Decency, honesty in public service and transparency in government activities are not the essence of populism. Populism is thus not only inefficient as a form of economic organization, but is also fundamentally immoral, in the very conditions of its functioning.