The Failure of Government Social Spending

The liberal idea that instead of supporting the poor with large and ineffective welfare programs, it is better to give them the means to improve their lives themselves, remains in force, and a good example of the ineffectiveness of the welfarism practiced by the traditional political class is the "bloated welfare state" of Costa Rica, argues Juan Carlos Hidalgo, project coordinator for Latin America at the Cato Institute.

In his blog "Por la Libre”, published in the online edition of the newspaper El Financiero, citing figures related to social development, Hidalgo exemplifies the poor results of many Costa Rican government social programs. For example, in two decades, the poverty rate remains at about 20% of population, having experienced a slight growth in recent years. Moreover, according to recent local press publications, Costa Rica is the second country in Latin America where inequality has grown over the last decade.

Source: elfinancierocr.com

More on this topic

Nicaragua: Preliminary Report of the IMF

September 2011

The report underscored the importance of persevering with the process of fiscal consolidation and public debt reduction, while protecting investment and social expenditures.

IMF Mission Visits Nicaragua to Conduct Seventh and Last Review of the Extended Credit Facility Press

Business-Government Dialogue over Reforms

April 2012

The COSEP of Nicaragua and the government are reviewing issues such as future tax reforms and social security, the new agreement with the IMF and the adjustments to the electricity tariff.

The Superior Council of Private Enterprise (COSEP) recently met with the counselor for Economic Affairs of the Presidency, Bayardo Arce Castaño.

Development consensus urgently needed in Nicaragua

September 2008

Democracy, education, jobs and public safety, as well as poverty, social inequality are some of the main challenges facing Nicaragua.

Government representatives such as the president of the Central Bank of Nicaragua (BCN), Antenor Rosales, admitted that the "absence of a true national model adopted by a wide cross-section of the Nicaraguan society, the inadequate results from models applied in the history of our country, demonstrate the urgent need for the adoption of a consensus model to eradicate poverty and reduce inequalities."