$Unique_ID{COW00185} $Pretitle{273} $Title{Argentina On Reform of the State and National Transformation} $Subtitle{} $Author{Dr. Carlos Saul Menem} $Affiliation{President of Argentina} $Subject{state national social new political public control transformation economic participation} $Date{1990} $Log{} Country: Argentina Book: On Reform of the State and National Transformation Author: Dr. Carlos Saul Menem Affiliation: President of Argentina Date: 1990 On Reform of the State and National Transformation My Fellow Argentines: A year after my inauguration, Argentina should be putting an end to the litany of recurrent crises and the causes of her deterioration. We all know what they are. We all suffer them. We all know what we are like and what our situation is. It is not enough for Argentina to talk about what has not been done and what could not be done. We Argentines ought to talk about how to build a true and possible future. We must, therefore, implement a national transformation, and I now call upon all of you to undertake the task of reforming the state and of participating in the productive revolution. Here, I will specifically refer to the state reform for national transformation. I am asking you to carry out a national transformation based upon a genuine change in our cultural concept of the state. I am inviting you to change the State so that we may to regain the fundamental values of freedom and social justice. The reform of the State is the new blueprint for the country within the framework of national transformation. This project requires national unity, full commitment, and responsible participation from all citizens. The protagonists of this project are those Argentines who build on shared ideas. It belongs to those Argentines who forge their own destiny and decide their own fate. National transformation is much more than the reform of the state. State reform is much more than the privatization of certain public companies. For national transformation, state reform means nothing less than a behavioral change in the relationship between the individual and the state. One that strengthens freedom and regains the participation of man and the community. The goals of state reform are explained by the principles which are the guiding force of this model of the future. For the Justicialist party, the principles of state reform are: national unity, realism, planning, participation, popular market economy, private initiative, fair and efficient public benefits, decentralization and integrity. These constitute the guidelines along which the new state must be built. Justicialism, while maintaining permanent political principles, updates its proposals, adapting them to historical circumstances. It provides the answers pertinent to any given moment, within a democratic political framework, to achieve social justice and economic growth. National transformation is the result of my deep revolutionary conviction. I am not proposing a revolution. We are already immersed in one. We are now working on a more effective and efficient implementation of changes. This being the case, we must now: 1) Relocate the State. I declare here and now that the State did not fail. Statism is what failed. To give the State its right place, means to give it a new and different place in its relationship to the individual and society. To give the State its right place, means to make it democratic, as our aim is to achieve a social and democratic state in which the rule of law prevails. The State remains valid as a political organization and a historical entity. What is no longer valid, is its active involvement in business, production, industry and commerce. The State is spent, not as a social political order, but as a state enterprise. Excessive growth, an unbalanced relationship with the individual and society, and the weakening of social participation, make it mandatory to place the State in a new sphere enabling it to guarantee public freedom, individual rights and collective interests which have, until today, been unprotected by a crushing and inefficient state that broke the balance between authority and freedom. Political action to relocate the State will extend to all areas. Once the State has been relocated to its new position, it will evolve from one of democratic representation to one of democratic participation. 2) Redistribute the economy. Under a new popular market system, we will achieve national economic growth. When we talk of a popular market economy, we mean a system that must be at the service of the people; it must be an ethical economy and must lend dignity to the people. This economy consists of a popular and a market element. The first creates new work, guarantees social justice and makes it possible for the State to intervene in defense of public welfare. The second recognizes and guarantees economic freedom. Redistribution pertains to reform in the economic sector. Reform imposes new principles and rules on the economic process in order to recover freedom, private initiative, competitiveness, investment, capital, production and work. Redistribution aims at making economic democracy become a reality. Redistribution implies economic decentralization of the State in favor of other political units, such as provinces and municipalities, the community, intermediate associations, individuals, the private sector and business. State sector concentration and the decline of the industrial and commercial state compel us to redistribute the economy, enhancing the return of private activities, until now under state intervention, to private ownership. Redistribution also demands that we privatize what should be private, abandon the protection of subsidies, and accept the challenges of investment and risk. The operative or political measures of a new redistributed economy require economic, decentralization, promotion of social property, economic deregulation, recognition of cooperative enterprise, sectorial participation in economic management, development of regional economies and constitutionalization of the economic order. 3) Reorganize the government. Centralized administration requires a new structure and functions. We have on the one hand, an executive administration which has become totally denaturalized by its multiple structures, duplicated responsibilities, state overdimension, bureaucratic proliferation, the loss of prestige in selecting and administrative career, and the blind application of rules. While on the other hand, the age old culture of the dossier, backbone and paradigm of the bureaucratic culture; all of which make it mandatory for the higher echelons of government to have a new organization. The reorganization of government must be global, encompassing institutional, functional, personal and patrimonial needs. The government's functions will be determined by the role of the reformed state in the areas of production, labor, services, domestic and foreign policy, education, health, justice, defense and social action. The administrative structure must open the way to the exercise of power. However, the new administrative structure should be the result of political prudence, and not excessive rationalization. The general public, the tax payer, the consumer must all participate in administrative management. We must upgrade the public function to a function of service. The efficiency of the country's administration will depend entirely on the public official's competence, skill, sense of responsibility, and professionalism. 4) Reconvert decentralization. The reconversion of the decentralized state and non-state public administration, is also a consequence of this new position we give the State. To reconvert is to change things back to their original status; to their genuine version. The reconversion of political decentralization will truly and effectively restore to the provinces and municipalities responsibility for their own competence and roles. The reconversion of administrative decentralization will transfer to the private sector those companies and activities that still remain in the hands of the State. This will be accomplished through privatization, concession, license, permits, cooperatives, administration, shared property programs, leasing and private administration. In turn this will make community participation possible in the management of common interests, through the institutionalization of intermediate associations, cooperatives and consortia that make up non-state public administration. Thus, the State, fundamental and essential manager of the public good, is made aware that in order to fulfil its function, it must rally only political participation, but individual and social administration, as well. For this reason, we have given priority to reconverting the hydrocarbon, electric power, communications, transport, water and sanitation sectors. This is the dictate we had to follow. There was no alternative. We could only choose between collapse or reconversion of public companies. There was no time to waste. So simultaneously we implemented rationalization and reconversion. We could choose neither the pace or the time, as everything was still is, urgent. We could not consider palliatives or home remedies. We had to perform major surgery, recover confidence and restore hope, as the first and fundamental steps towards transformation. We had to establish priorities, and initiate immediate action in these sectors. Thus, television, the oil industry, highways, telephones, railroads, Aerolineas Argentinas and the hydroelectric and power sectors were all placed on the list. 5) Recreate control. We must reactivate public control so that it is capable of safeguarding freedom. The republican system imposes a check and balance safeguard between government and control. Control is not only a power; it is also a duty. There is no power without control, or at least, that is the way it should be. Effective public control is necessary to assure that public action abides by the rules of law and good administration. Control cannot be a mere formality. It must provide an efficient, integrated and reliable political system, based on technical quality, professional skill and functional independence of the controller's authority. The present public administration control structure must be subdivided into two bodies, directly dependent upon the legislative power, so as to strengthen the latter's control. This will ensure the autonomy of the control entities with regard to public administration, and achieve greater direct control by the people's representatives. We therefore propose the establishment of a General Controller and the appointment of an Ombudsman. The two bodies we propose to create must complement the political, administrative and judicial controls inherent in our republican system of government. Furthermore, to assure the feasibility of social control, we must establish user and consumer organizations. 6) Reinstall Congress. National transformation demands a fully revitalized legislative power and a strengthening of its control so that Congress will be redeemed as a republican, federal and control body. As an instrument of the republic, representing the people's sovereignty, congressional power lies in its sanctioning of the law. Its strength lies in dictating the law governing public, social and individual activities. It is a mission that can be neither substituted nor delegated. The laws, the "major" laws, such as those of transformation, those of a new country, must be made and passed by the National Congress. In doing so, therefore, Congress owes it to the people to pass the laws of the land for the newly reformed and transformed State. As a federal body, it must genuinely express the province-nation equation as an integrating synthesis. It must be a federalism of complementation, coordination, agreement and integration between provinces and between the provinces and the national. As a control body, the essential function of Congress is its power to supervise classical constitutional and legal judgement of political, fiscal, responsibility, and investment decisions, among others. Accordingly, the political measures to be implemented in order to achieve legislative redemption are: the restructuring of congressional functions and the recovery of its specific task of legislating and controlling. 7) Redefine federalism The relocation of the national State implies the relocation of the province. The relocated State is federal. Federal redefinition makes it mandatory to establish new concepts for federalism. Federalism must shift from planning to practice. We must install a federalism that is workable, form a political-institutional, and an economic-social stand point. The model for these reforms is our answer to progressive centralization, and the present weakness of provincial autonomy. These changes lay the foundation for local involvement based on a decentralized and participative organization. Federalism is an essential component of the democratic system. Our democracy is federal and this makes feasible authentic institutionalization of provincial participation through geoeconomic and political integration. Federal democracy is a dynamic democracy based upon complementary and coordinating relationships, whose operative measures are a regular distribution of responsibilities, to strengthen the region as a federal alternative, to encourage federal and interstate enterprises, and to sign interprovincial integration treaties and laws of agreements of adhesion and complementation. This federalism is workable. With it, decentralization and provincial participation will not be imaginary. Only thus, will the provinces stop being mere subsidiaries of the national State, without their own political and economic power of decision, and it will be possible to recreate institutional dialogue for establishing a fair redistribution of federal funds. The solution is to find inter-jurisdictional formulas for administering water, energy and hydrocarbon resources, etc. via federal agreement, the most effective political tool of integration and participation. 8) Redimension the municipality. True federalism, without a municipal institution of the right scale and without decentralization and participation, does not exist. The municipality, as a political and administrative entity, must also find its new location in relating to its citizens its inhabitants and their organizations. It must find its proportionate size and distance, while allowing for the participation of its neighbourhoods and providing for adequate coordination with the province and with the nation. Redimensioning the municipality implies adjusting its political and administrative structure and organization to its real requirements. We must not create more "States" just for the sake of creating them and satisfying local appetites. This only serves to encarge the administrative apparatus without sufficient justification. We believe that reality has superceded population or territory as criteria for the existance of a municipality. Today, both appear to be insufficient, as they have not helped local communities in providing, their most elemental needs. Each province should, therefore, implement the measures for establishing a municipality by taking into account: its composition; its territorial area; the size of its population; its economic, financial, and technical resources; and its overall urban needs. 9) Reform the Law. Historically, whenever the State is transformed laws also change because crisis in a State is accompanied by crisis of the Law. To reform the Law is to give it new formulas so that it is expressed in clear and precise terms. Our aim is to consolidate a fair, democratic system of social coexistence. To achieve this, we require a legal system based on justice and freedom. The new legal system must be personal and humanistic, it must allow for individual and social participation in political, social, economic and administrative spheres. We do not just seek legality. We seek the legality of liberty and social justice. The new Law for the reformed State will have its roots in national history and will be termed politically democratic. And integral, integrating and coherent judicial system must be established, encompassing everything from the Constitution to the smallest administrative act. The norm, the law, must not reflect abstract ideas or illusions, but the habit of the Argentine man and community. The new judicial institutions will only remain on paper if the State does not play its role in converting them into reality, because people are mobilized not only by ideas, but by deeds, as well. National transformation imposes new formulas for the law, as it must serve as the language by which the State communicates with individuals. Redimensioning the judicial system is the Legislature's fundamental task. We seek to improve the quality of policy making. To establish judicial system that adapts to social reality, we must take into account the principles of realism, pragmatism and justice. In so doing, we will be able to draw up a law of quantitative "dimensions", technically "well informed", socially "recognized" and politically "compatible" with the values and goals of the transformed state. Consequently, we must aim towards reforming the Constitution so that it becomes the institutional pact for national transformation. It must reflect the agreement between all political and social sectors responsibly committed to national unity, as an essential prerequisite for peace, freedom, social justice and economic progress. 10) Renew the State. The state reform will give us a renewed State. The reformed state is the State, renewed in its roles and commitments. National transformation requires the State to act as guide, organizer, administrator, planner, servant, controller, protector, guarantor, regulator and distributor. These functions outline the mission of the new State for the fulfillment of man and society. We say the State is a guide because it holds, exercises and protects the political leadership of society, with public good as its ultimate goal. We say the State is an organizer because it sets the rules to organize itself, and establishes the guidelines to organize society, based on social pluralism and the autonomy and freedom of individual and social organizations. We say the State is an administrator because it institutionalizes and administrative structure to ensure efficient and fair benefits and services. We say the State is a planner because it is responsible for drawing up governmental action plans and projects, and for carrying them out. The State must implement democratic and coordinated planning with the participation of the productive, capital and labor sectors. We say the State is a servant because it is at the service of its mandator, the people. The State serves public, it cares for its citizens. The State, directly or indirectly, provides public services. The State does not monopolize public services. These may be provided by consortia, cooperatives or concessionaires. We say the State is a controller because it has the power to control. Without control, there is no democratic state of law. There is no liberty without control of the exercise of rights by others. We say the State is a protector because it looks after the rights and interests of the community. The protective State shelters and defends. The State must encourage and protect private initiative, investment, manpower and labor. The State must stimulate the development of economic activities by the private sector, within the framework of economic and social planning. We say the State is a guarantor because it can intervene substitutionally in lieu of others, should this become necessary. The citizen must be assured that, in this new order, protagonism is individual and social, because the State will intervene only when the commitments to public good are not fully complied with. We say the State is a regulator because it adjusts social coexistence and individual development to principles and rules. The State must strengthen humanistic and democratic Law. And we say the State is a distributor because it must fulfil its commitment to social justice. Give each one what he deserves according to his own right. Finally, I maintain that transformation is the challenge of today. Reform of the state is one of its prerequisites. The other is productive revolution. National transformation will make it possible for national interest to prevail over individual or foreign privileges; social justice over sheltering of the weakest; competition over monopolies; production and work over speculation; solidarity over indifference; the opening up of the world over international isolation. National transformation is the new philosophy that groups and enthuses us Argentines, living on the threshold of the twenty-first century. Buenos Aires, August 1st. 1990.