The book that anticipated Milei’s project to “imprison the politician who issues money and generates inflation”

Ricardo Manuel Rojas He now lives in Guatemala, is 65 years old, and spent more than 40 years in the Argentine courts. He started from the bottom and worked in lower courts, in the Chamber and became a secretary in the Supreme Court. He combines deep knowledge in criminal law and economics, two areas that are connected in obvious but also subtle and underground ways. He left Criminal Court No. 18 of the city of Buenos Aires in 2020 and dedicated himself to teaching. He has known Javier Milei for 10 years and in February 2023 it was news because the then candidate and now president carried his book “Inflation as a crime” to the media.

That idea that Milei proposed then was foreign to the Argentina of stocks, controls and inflation. But a year later she somehow decided on a bill that would go to Congress for debate. The former judge and now professor at the Francisco Marroquín University of the Guatemalan capital spoke with Infobae about the unexpected derivation of the work he published two years ago. He highlighted the “bravery” of the head of state and warned that Peronism and radicalism should approve it because “the first affected by this measure will be the president himself, who limits himself.”

“The project prohibits the issuance of money and when there is someone who issues money, they go to prison.”“Javier Milei told Jonatan Viale last night. And he revealed that he anticipated the initiative in the meeting he had at Casa Rosada with Gita Gopinath, the deputy managing director of the Monetary Fund, which represents the United States in the organization. “His eyes became like the golden 2. She could not believe it. He was surprised by my level of orthodoxy. I think she was pleasantly surprised,” the president revealed on TN.

With a youthful sympathy for the UCeDé, from the times of Álvaro Alsogaray, Ricardo Manuel Rojas said that he has sporadic contact with Milei. Now less than before. One is in Guatemala and the other is dedicated to the tasks of presiding over a country with extravagant imbalances and in the midst of a fiscal adjustment program. The former criminal judge admits that when they saw each other he called him “professor.” It is the same term that the libertarian leader uses with economists like José Luis Espert or Juan Carlos De Pablo.

“The book was published for the first time at the end of 2022 and last year an edition was made in Portuguese,” Rojas said at the beginning of the interview and addressed the origin of this idea of ​​linking the broadcast with a crime that deserves prison. . “I wrote ‘Inflation as a Crime’ because there was a lot of discussion and misinformation regarding the causes of inflation for a long time. “Politicians who issue currency to cover the deficit always deceive.”

“Inflation, by definition, is the increase in the amount of currency. In a system where the currency is monopolized by the State and is of forced tender, issuing more money than it corresponds – taking into account the amount of goods and services that circulate in society – necessarily generates inflation. And inflation is a form of currency counterfeiting or theft. But a very perverse form of theft, because people’s money is stolen without them realizing it. People have the same amount of money in their pockets, but it is automatically worth less as a result of the fact that they increased the amount of money in circulation,” said the former judge. His words evoke Milei.

According to the former magistrate, he began writing about inflation from the point of view of criminal law and why the issuance of money without backing should be considered a crime. “I published that book in 2022. The President at that time was not president. He saw it, called me and we talked about it quite a bit. And then he took it to several television programs and gave it to several journalists and that gave the topic quite a bit of publicity.” The memory is corroborated when searching on social networks and YouTube for the name of the book and Javier Milei.

-Why did you decide to write “Inflation as a Crime”?

-When I wrote it, inflation had already become a serious problem and at that time the government not only did nothing to eliminate it, but on the contrary, the emission was growing and the palliatives they put in place were price controls and regulations that from the beginning Emperor Diocletian never functioned in the history of the world. It was a very serious situation and, furthermore, due to my training as a criminal lawyer, It seemed very clear to me that an activity like issuing pieces of paper that have no value and imposing them on people had to be a crime.

-It is a definition that can be shocking to consider broadcasting as a crime.

-In the book I elaborate on the criminal legal assets that are involved, which is a deeper theoretical discussion. The idea is that an act like this, which involves a form of currency counterfeiting, should be classified in the Penal Code.

-But what type of penalty would it be? How can a government decision be attributed to a criminal act?

-The criminal type is complex. To define it, legal and specific limits must be set for the Central Bank to issue. In monetary theory there are several alternatives: it can be a percentage of the currency per year – as Milton Friedman said – so that no more than 3%, or equate it with the increase in the Gross Product, and that no more than that can be issued. Once that limit exists, any Central Bank official who issues above that limit would be committing the crime.

-But what would the crime be?

-The crime would be the issuance of currency to put into circulation. What the crime consists of is issuing money and putting it into circulation through the government, which is why it is a crime that involves officials.

-So it wouldn’t be falsifying, it would be the crime of “broadcasting”?

-The money is not fake because it is issued by the State, but it is equated to a form of counterfeiting in the sense that they are decreasing the value of money through this maneuver of increasing the amount of money in circulation. For a measure of this type there must be clear rules, because criminal law requires that there be fraud, an intention. It has to be clear what the criminal type is. Limitations to the State are also linked to this issue.

And I give this example: I am living in Guatemala and the Constitution of this country prohibits the Central Bank from financing government expenses. It cannot ask the Central Bank for money, not even borrow it, to finance its deficit. This is what it has done is that the country has its accounts in order and has not had inflation for 30 years. The problem is when there is no such great differentiation between the government and an independent Central Bank, such as the United States Federal Reserve, which cannot be co-opted by the politician in power to finance its expenses. When that doesn’t happen, you have an explosive cocktail. That happened in the last governments.

-What do you think that the President first raised this idea?

-It gave me a lot of joy, but I’m waiting to see what the project is finally like. My book has a bill in that book. He can take that or he can adapt it, I don’t know ultimately what he will do. From a personal point of view I am very happy.

From the functional point of view of the President, he seems to me to be very brave. Because he is first limiting himself, because obviously central banks issue when presidents ask for money. He would be, if he issued money to cover the deficit, the first who would be putting himself in the role of partner in the crime. He is a limitation for himself, which shows great courage and confidence that he will be able to level the accounts, without needing to issue in the future. At least in the near future.

This has already been communicated to the Monetary Fund and it is a sign that he is willing to level out the deficit, which is the main economic problem that the country has. If Milei can avoid the need to issue currency to cover the deficit, it will have made enormous progress in improving the economy.

-Do you think the Government will be able to stop inflation? Can emissions be stopped after so many years of going in the opposite direction?

-You have to see the fine numbers. Obviously the deficit was enormous, but the orgy of spending in the previous government has been enormous. You see numbers on expenses in the INADI, for example, the number of sources of negotiations and expenses that there have been in the country in recent times. Funds for many people to become illegitimately enriched.

If all of this is cut, the deficit can be lowered and also begin to grow, because the other leg of this issue is for the economy to grow and revenue to increase. But it is very difficult if we do not first stop this inflation and this uncontrolled spending that we had.

-It is a project that will go to Congress and we have already seen what happened with the “Omnibus Law.” What would you say to Peronists and radicals who do not see the broadcast as a bad thing?

-I would tell you first that there cannot be a country with a healthy economy if it does not have a healthy currency. Inflation is a cancer that prevents any growth or any solution for the country. As point number two, I would tell you that inflation is a form of cheating and robbing people. No one with good intentions could be on the side of justifying cheating. And thirdly, the person who is asking for this is the president himself, who ultimately is the one who could take advantage of the trap and is saying “I am going to set a limit for myself.” That’s very brave. If I were a legislator I would have no reason to oppose a law of this type.

-The Peronists and some radicals do not think like that.

And that’s how it went for us. The point is that many times politicians, when they resorted to these tricks, they themselves knew what the result was going to be. When Alfonsín reached hyperinflation he knew what the result was going to be, but he was not willing to take the political measure that had to be taken, which was going to be painful, as it was later. On the contrary, he chose to leave the government five months early.

In this case, the person who is applying this painful measure is a president who is neither radical nor Peronist, so I think they would be very hypocritical if they did not support a law of this type at this time, because furthermore they are not going to have You pay no cost, on the contrary, it’s all Milei.