The Fiscal Pressure Illusion.
Why Citizens Pay More Than They Get Back
The fiscal pressure illusion: why citizens pay more than they receive
This second article examines the direct relationship between state waste and the cost of living in Uruguay.
The premise is straightforward. The state has no money of its own. It only manages what it takes from citizens. Every unnecessary public office identified by CERES therefore represents a hidden tax, paid daily even when it never appears on a bill.
Uruguay has reached a level of fiscal pressure that can only be described as an insurmountable ceiling. Raising taxes further to cover deficits caused by inefficiency does not solve the problem. It worsens it. Investment is driven away, informality expands, and productive actors are left with shrinking margins.
Unable to raise visible taxes, the state relies on less transparent mechanisms that are equally harmful. Public utility tariffs and inflation operate as indirect taxes that bypass democratic debate and public scrutiny.
The systematic use of state-owned enterprises as revenue-collecting tools constitutes an institutional deception. When fuel, water or electricity prices fail to decline despite favorable international conditions, the reason is not technical. It is fiscal. The surplus is needed to sustain an oversized public structure.
At this point, irrationality becomes systemic. Expensive energy that undermines small and medium-sized enterprises is tolerated, while duplicated bureaucratic structures remain untouched.
Country cost is not a natural phenomenon. It is the direct outcome of political decisions that prioritize the preservation of inefficient state structures over collective well-being.
CERES estimates show that eliminating excess state spending could reduce Uruguay’s production costs by fifteen to twenty percent. This is not ideology. It is basic economic arithmetic.
In this context, the use of artificial intelligence to diagnose public spending represents a turning point. The analysis conducted by CERES took seconds. What once required years of fragmented audits can now be achieved through intelligent data integration.
Munyo’s proposal enabled the mapping of entire spending networks across ministries, autonomous agencies and local governments. The result revealed bureaucratic metastasis. Different programs, different names, identical functions, targeting the same population.
This technology removes plausible deniability. There is no longer any excuse for not knowing where money is wasted. The gray zones of public spending are now fully exposed.
Housing policy provides a clear example. Multiple programs operate without shared databases. One citizen may receive benefits from several programs while others receive none, all financed through rigorously enforced taxation.
Artificial intelligence shows that the state does not need more money. It needs better management.
From this diagnosis emerges a concrete proposal. Implement zero-based budgeting in areas where duplication is detected. Every public office should justify its existence from the first dollar, every year.
If AI confirms that the function of one office is already covered by another, it must be merged or eliminated. Not for ideological reasons, but for efficiency. This is the only way to break a cycle where spending becomes a bureaucratic entitlement rather than a public service.
Refusing to undertake this reform is the fundamental deception that keeps the country stagnant or confined to mediocre growth that fails to improve most citizens’ lives.