Arbitrariness upon arbitrariness

The Government has once again gone down the middle street. They allow the temporary tax on energy companies to decline but prolong that of banks in a solution that is not only arbitrary but is completely incomprehensible. There is no possible explanation. What criteria has been followed when maintaining one and eliminating the other? The answer is very simple: none. Now, just because there is no criterion behind this performance does not mean that there is no explanation. The energy companies have known how to fight it better – with some senior executives making a clear and forceful statement – and have managed to win the day, while the banks have not managed to get on the bandwagon – in the end it is not going to be true that The bank always wins. Banks have worse press. Junts or the PNV have had no problem taking a stand in the case of the electricity companies and, however, they have fought less for the banks’ solution. The other Government supports, which clamored in favor of maintaining both taxes, have simply swallowed because they cannot do anything else, which is undoubtedly a good measure of their ability to influence economic matters. None. It is important to highlight that, in the case of banking, the PNV has stepped in and will be able to negotiate the new temporary tax. From now on, the tax will not only be arbitrary but also discriminatory. And two hard-boiled eggs. This change must have gone unnoticed because there has not been much reaction on the part of the Popular Party, which is the one who should be responsible for such an outrage. The new banking tax, as the sector says, is a decrease in competitiveness. which logically has an impact on the economy’s capacity for growth. The greater the obstacles, the less credit in circulation. And that is what this new tax does, it curtails the ability to provide credit. But not only that. It also discriminates between Spanish banks. The Basque Foral Estates will be able to reward those who are there compared to the rest who have their registered office elsewhere. Simply embarrassing. And I suppose it will be something that many of the other parties in the current government coalition that have nationalist whims – Junts included – will have overlooked, although in all fairness there is no longer any large financial entity domiciled in Catalonia. In short, and although it is very good news that the temporary tax on energy companies will not continue, the way in which they have resolved it is a botch of such magnitude that it can only anticipate the little legislative path that this Government has in economic matters, Budgets State Generals included. It gives the impression that we are in the garbage minutes of this cabinet and that each one is pulling to his side at the risk, of course, of breaking the bag.Oil and its fall in priceThe behavior of the oil price in recent months deserves a reflection. After the strong rebound it experienced after the pandemic due to problems in supply chains and, later, due to the energy crisis resulting from the invasion of Ukraine, it has done nothing but fall. Neither the serious crisis in the Middle East, nor the successive production cuts by OPEC countries, nor the sanctions on Russia, nor the anxiety in Mexico or Venezuela have caused a sustained rise in its price. Any of the events those we have faced in recent times would have caused a sharp rise in oil at other times. Not now. And this probably has to do with the market valuing the structural change that is occurring in the energy markets. It will not happen overnight, but the relative loss of importance of black gold is something that is here to stay. And the path, as the price behavior in recent months demonstrates, is only one. In the same way that the Stone Age did not end because stones disappeared from the face of the earth, the oil age will not end because, as has been speculated many times, we will run out of oil. It will be a long transition, in which new energies will gain weight and the decline of crude oil will be inexorable. A transition of this magnitude leaves winners and losers along the way. The latter are easy to identify. They are that gang that meets periodically in Vienna trying to keep prices high at all costs. In many cases their only competitive advantage – sitting on top of an ocean of oil – is going to disappear. It is urgent that they reinvent themselves. This change of era also represents a change of weights in the geopolitical balance with enormous scope. There will be many of us who will benefit. And in this case it is also important to establish degrees because there will be some who are more and others who are much less. All importing countries, which are basically all developed countries except the United States and Norway, will stop transferring money to producers. However, among these there will be some that also clearly benefit from the greater relative weight of renewable energies. Among the latter is, and in a privileged situation, Spain. It will happen in any case but it would be much better if it happened with some intelligence on our side.

#Arbitrariness #arbitrariness