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National Assembly overwhelmingly rejects Moreno’s economic reform bill

President Lenin Moreno suffered his second political defeat in a month Sunday night when the National Assembly resoundingly rejected his Economic Growth Law. Following his capitulation to indigenous leaders in October, when he agreed to reinstated gasoline and diesel subsidies, several assembly members questioned the president’s ability to manage Ecuador’s worsening financial crisis.

The National Assembly rejected President Lenin Moreno’s economic reform bill Sunday night. (El Comercio)

The Assembly voted 70 to 32 with 31 abstentions against Moreno package of tax increases and regulatory reform even after it was reduced from 185 articles and 40 provisions 404 articles and 38 provisions.

Immediately after the vote, Moreno said he would submit a new proposal to the Assembly. “In the next few hours I will submit a new economic emergency bill focused on tax issues,” he said. He added that he regretted losing “precious time” in dealing with urgent economic problems and said his new proposal will ensure that any new taxes will impact the rich and not the poor.

Several legislators criticized the defeated law for attempting to cover too many issues. “We welcome new proposals but only if they have consensus support in the Assembly,” said assemblyman Raúl Tello. “The president says reform is urgent, yet he attempted to cover many non-tax issues and he did this without consulting even his own constituency in the Assembly.”

Another assemblyman, Henry Cucalón, said Moreno acted in bad faith. “Now he has a chance to redeem himself by opening the process to all parties. It’s time we get serious and work together to build a strong economy and strong country.”

Assemblyman Raul Tello compared Moreno to a “wounded animal” and said that he lacks a coherent economic plan. “First, he gives into Conaie and then he puts forth legislation which seems confused and was probably unconstitutional. At this point we are wondering if he has the ability to solve the country’s pressing problems.”

In his post-defeat statement, Moreno did not say which tax proposals included in the first bill will be in the second. The defeated legislation would have raised $737 million in new revenue, according to the finance ministry.

11 thoughts on “National Assembly overwhelmingly rejects Moreno’s economic reform bill

  1. Meaningful economic reform isn’t going to happen any time soon at this rate, if at all. Everybody talks reform, but nobody wants to actually participate in sharing the load. The ol’ screw them, not me attitude. The economy is on the clock.

    1. The economy was doing just fine until Moreno made the president of the Chamber of Commerce his Finance Minister (after his first two ministers refused to sell his plan to bring back the IMF). Why is anyone surprised that dropping the investigations on billions in tax fraud and handing major sources of revenue over to the Buracarams has dragged the economy into recession? It’s not like anyone said this would happen . . . well, except Correa and Moreno’s first two Finance Ministers.

  2. Well, we’ve dodged a bullet for the time being, strike-wise. Good, I can at least enjoy Thanksgiving dinner without wearing a gas mask.

  3. The complexity is too much for any one man to make good decisions. Now is the time to make a referendum to restructure from vertical to horizontal governing which is virtually incorruptible. This is the demand that needs to be made, a referendum for horizontal governing. If anyone wants to know this is completely feasible without the need of any disruption to daily commerce, you can email me at mofwoofoo@gmail.com. Then all the problems can be addressed by the people involved in a truly democratic way.

    1. We had that in the CPCCS. Then Moreno gave us “siete veces SÍ” and almost overnight it was completely gutted. Now all we have left is the entire government from the prosecutors to the National Court of Justice to the Constitutional Court all working at the whim of the executive. Luckily there’s still an ounce of decency left in the legislature. Sadly, a few greased palms and some good old fashioned patronage and this newly found backbone will crumble like it always does.

  4. Both you guys, Dogo and Hiram got it wrong predicting an imminent collapse of law and order. Strapping ourselves in while wearing gas masks? You should quit trying to scare the gringos. They won’t be able to focus on their Spanish lessons.

    1. The economy was doing fine until Martinez tried to convince us all that we were in “crisis” and needed sweeping reforms …. reforms that are almost identical to all the changes they made in the 90s that led to the complete meltdown of the economy.

      Ecuador has the most mediocre ruling class I’ve ever encountered. It’s like the 20th century never really happened here.

  5. Glad to see the National Assembly rejected the sweeping austerity measures rather than to allow them to become law without a definitive vote. President Moreno did his bit for the IMF and other financial institutions to try and force through austerity reforms by decree and by this “urgent” bill. He failed.

    The President lost his majority in the National Assembly when he split with Rafael Correa and 30 Assembly members from his party quit to form Citizen’s Revolution. Citizen’s Revolution is actually the largest single group in opposition in the National Assembly. There is also a large group of right-wing parties, which sometimes allies with President Moreno, especially regarding repressing the left and protests. In addition there is Pachakutik, which is also hostile to allies of Rafael Correa.

    On this vote, President Moreno doesn’t appear to have even gotten all the votes of his own party.

    Now that it’s clear that the President can’t force through the reforms the IMF demanded, members of the National Assembly are calling on Moreno to enter into a dialog with them. For his part, the President says that his next proposals will be about taxing the rich. The right-wing parties are going to really love that!

    1. He didn’t get the vote of his own party. It was defectors from the remnants of AP that doomed this maneuver. The idea wasn’t to get a majority of the Assembly. It was to simply get one third of the Assembly to vote against archiving it so that it would enter into law by default. In the end, all he could muster were the AP members still holding on to his falling star and all of CREO. It says a lot about a government when the only support they have left is that of the people who completely sold out the people who voted for them and an ultra-right party that has created international alliances with fascist groups in Brazil and Bolivia.

      Remember during the dictatorship when Correa would use parliamentary tactics to force through sweeping reforms nobody voted for instead of relying on the majority?

      Yeah, me neither.

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