Corrupción en año electoral

La semana pasada realicé una presentación de los indicadores económicos para Centroamérica y un punto en especial me pareció doloroso: en Guatemala un 24% de la población vive en Pobreza con menos de $3.20 por día (PPP) y 8.7% vive con menos de US$1.90 por día (PPP).  Ese es un número muy grande y duro de asimilar porque sus impactos negativos en la salud, bienestar y calidad de vida causan daños irreversibles en el desarrollo de las personas. La respuesta a por qué 1 de cada 4 guatemaltecos vive en la pobreza está en la corrupción y la falta de un plan nacional claro que incluya programas asistencialistas y de desarrollo. 


Video: El dinero sale; los pobres, no

La corrupción engendra pobreza. Esa es la conclusión del Informe sobre el Desarrollo Mundial en el que el Banco Mundial citó  “evidencia de que los niveles más altos de corrupción están asociados con un menor ingreso per cápita”. La historia muy bien conocida por todos nosotros es que los sobornos aumentan los costos de hacer negocios, por lo que los países más corruptos atraen menos inversión extranjera directa, lo que reduce las tasas de crecimiento y los ingresos per cápita.

Sin embargo, esto enmascara una distinción importante entre el soborno de empresa a empresa (B2B) y de empresa a gobierno (B2G). Lo primero a menudo se resuelve mejor, ya que es rápidamente corregido por la ley de la oferta y demanda en condiciones de mercado libre. Sin embargo, la corrupción B2G es un monopolio muy protegido y vigilado por quienes se benefician de esta.

En su forma más suave y benigna, el soborno B2B puede facilitar la comunicación (reducir los costos de información) y ayudar a consolidar las relaciones entre los principales (por ejemplo, en una cadena de suministro). Los “pagos de facilitación” (desde comisiones generosas hasta membresías en clubes de golf, invitaciones a almorzar, regalos y viajes de ocio gratis) pueden reemplazar los costosos contratos contingentes con contratos implícitos que aseguran que se cumplan los requisitos de calidad, cantidad y programación.  Esta práctica vieja y por todos conocida ha empezado a eliminarse conforme muchas empresas establecen códigos de ética más estrictos al respecto. En este caso, el soborno B2B tiene un beneficio compensatorio, aunque no ético, que en la red reduce los costos de transacción y engrasa las ruedas del comercio.

Los casos graves de soborno B2B suelen implicar una ganancia privada por parte de un empleado sin beneficios compensatorios. Esta forma más insidiosa es como un gusano que se come las ganancias corporativas. Por ejemplo, si, como se afirma, los ejecutivos de las grandes empresas petroleras hicieron pagos laterales sutiles (negocios de dirección) a socios como Arthur Andersen para promover y/o ocultar actividades de contabilidad y financiamiento fraudulentas, entonces los accionistas son las víctimas.

Image result for corrupción el fo prensa libre guatemala

En marcado contraste, los casos graves de soborno B2G implican ganancias privadas que se han repetido en TODOS los gobiernos que hemos tenido (generalmente por parte de corporaciones afines al gobierno de turno y empleados públicos) a expensas de empresas competidoras y del público en general. La gran diferencia entre el soborno B2B y B2G es el gobierno. Los funcionarios del gobierno tienen el poder de cambiar las reglas del juego y ostentan el poder monopólico sobre legislar y controlar las instituciones que gobiernan la actividad de mercado.  En los últimos meses un monopolio naciente que se disfraza de beneficio público ha sido la legislación en municipalidades y en el Congreso que prohíbe ciertos productos desechables plásticos y favorece al cartón, vidrio, bioplásticos y aluminio. El gobierno crea un monopolio no por el interés ambiental o del pueblo sino para favorecer una industria específica disfrazada de responsable filantropía.

No es sorprendente que una forma popular de soborno B2G implique la “búsqueda de rentas” de la que tanto hablamos en los cursos de economía en la UFM.  Esta práctica en nuestra región es muy intensa y busca influir en el diseño o la aplicación de reglas, regulaciones, evaluaciones de impuestos, zonificación, contratos, etc. Desafortunadamente, como Mises enfatiza en Acción Humana, en el caso de la corrupción B2G, “por regla general, un individuo o un grupo de individuos se enriquece a costa de otros individuos o grupos de individuos”. En contraste con algunos sobornos B2B que realmente pueden beneficiar a ambas partes, el soborno B2G es, en el mejor de los casos, un juego de suma cero tal y como siempre recodaba el Muso Ayau.


En lugar de simplemente redistribuir la pizza, un juego de suma cero (lo que yo gano, tú pierdes), en este caso, el soborno B2G reduce el tamaño de la pizza, un juego de suma negativa (todos perdemos).

Cuando una empresa o industria guatemalteca o extranjera intenta obtener una ventaja competitiva a través del soborno B2G, esto provoca que otras industrias y grupos de consumidores se defiendan. Incluso en los casos en que una empresa puede sobornar a los funcionarios para que no cumplan con las regulaciones verdaderamente malas, esto provoca una presión contra el lobby por parte de las empresas que se benefician de estas regulaciones. En los últimos años esta práctica se evidenció cuando industrias específicas patrocinaron y sobornaron a partidos políticos específicos que llegaron al poder. Hemos vivido los desastres del extractivismo en su máxima expresión.  A veces, estas regulaciones no son más que barreras poco veladas para proteger a las empresas predominantes (nacionales) de la competencia (extranjera) como ocurrió en la década de 1960-70s. Sin embargo, economistas como Gordon Tullock y otros han demostrado que la suma de los recursos agotados en el soborno ofensivo y defensivo B2G puede ser mucho mayor que el valor de la decisión favorable o del contrato gubernamental.

Menos gobierno es igual a menos corrupción. Las empresas siempre buscarán favores del gobierno. Mises en su obra Acción Humana nos recuerda que “la corrupción es un evento regular de intervencionismo“. Por lo tanto, cuantas menos reglas, regulaciones, contratos, etc., los funcionarios del gobierno tengan la discreción de escribir, modificar o hacer cumplir, menos oportunidades de corrupción. Cuanto más transparentes sean sus acciones y cuanto más tengan que perder, mejor. Concuerdo con los economistas de la cosa pública que alentar a los gobiernos a emplear menos funcionarios públicos con menos poder y más salarios es un paso en la dirección correcta.

Image result for corrupción el fo prensa libre guatemala

Promover la transparencia es malo los corruptos, tanto B2B y B2G, pero esta es la clave para minimizar la corrupción. Acá, corresponde a los ciudadanos guatemaltecos restringir el poder del gobierno y exigir la transparencia de sus funcionarios públicos con candidatos que tengan esto entre sus planes políticos en la primera página.

Las regulaciones demasiado complejas son especialmente problemáticas porque fomentan la corrupción. Por ejemplo, el Ranking Doing Business informa que para iniciar un negocio en Guatemala se requiere casi un mes y 18% del PIB de una persona para iniciar un negocio; mientras que en Australia solo se requieren dos pasos, dos días y el 2% de los ingresos. En lugar de proteger a los consumidores y las empresas, las regulaciones gubernamentales fuera de control aplastan la actividad del mercado y actúan como un caldo de cultivo para la corrupción.

El camino que debemos seguir es el de reducir el poder de los funcionarios públicos y abordar la forman en que funcionan sus incentivos para exigir sobornos. La prensa libre del mundo, las organizaciones gubernamentales sin fines de lucro como Transparency International y las instituciones multinacionales como la CICIG, la OCDE, el FMI y el Banco Mundial pueden y deben desempeñar funciones activas de apoyo y debemos apoyarlas. Busquemos este año electoral a esos candidatos que nos ofrezcan soluciones para reducir el poder de los funcionarios y que busquen promover la transparencia. En ellos está el futuro de un mejor país.

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The never-ending cycle of revolutions

via: http://www.activistpost.com

“A revolution is the climax of a long philosophical development and expresses a nation’s profound discontent; a Putsch is a minority’s seizure of power. The goal of a revolution is to overthrow tyranny; the goal of a Putsch is to establish it.” Ayn Rand

The day after Revolution the streets were in silence. Anarchy was the rule and a no man’s land emerged. The protests against the ruling party had started several weeks before. However, as my grandmother recalled, the problems that had ignited the most recent uprising had always existed: ” these were the very old unfulfilled promises long inherited from Colonial times.”  Indeed, these promises were the idea that Government was here to rule over Us, to give Us and to provide Us for our needs and to care for our frailties.  The Global South has known dozens of revolutionary movements, dozens of attempts of revolutions and a handful of sanguinary coup d’états. Unfortunately, not much if anything has changed after the uprisings.

Around the world today conflict  continues in many areas that were once colonized or controlled by Western European or Soviet powers. The source of many of these protracted conflicts, in large part, lies in past colonial  policies, and especially those “regarding territorial boundaries, the treatment of indigenous populations, the privileging of some groups over others, the uneven distribution of wealth, local governmental infrastructures, and the formation of non-democratic or non-participatory governmental systems.”

It is therefore essential, if one wants to understand current revolutionary movements, intractable conflict and its causes, to examine not only the issues and problems of the moment, but also influential historical factors and actors – most notably, past colonial policies and today’s ruling power of these metropolis over former colonies – and their lingering effects.

The idea that the government should provide for our needs is more accepted in post-colonial governments that inherited institutions of dependency and granted privileges by the metropolis.  Imagine yourself traveling 200 years back in time to the period in which colonies were ruled by Western Capital. Interestingly, you will find yourself observing almost the same institutions and the same old problems that societies in the Global South still face today in Africa, the Middle East, South America, Eastern Europe and South Asia. The problems in these societies are the result of a long list of misguided decisions all centered in one fatal conceit: the conceit of revolution by force, not in defense, but in violation, of individual rights.

The colonial institutional heritage of the Global South is built around the abuse and violation of individual rights. Not a single revolutionary movement in the Global South has really aimed at restoring individual rights but to the granting of privileges for a minority.  The minority groups have taken many forms, received many names and have taken many slogans. They have been revolutions organized by and in contraposition of one minority group versus a majority: of the poor versus the rich, of the middle classes versus oligarch classes, of national interests of capital versus foreign interests, of enlightened groups versus conservative groups, of different ethnic groups against each other, of indigenous groups tired of being exploited, and many many more.

In order for a revolution that aims at restoring individual rights to take place it would be  necessary for all citizens to first redefine their code of values upon principles that allow them to pursue happiness without violating the rights of others.  This means that for a “revolution and not a putsch” to take place in the Global South we need first to understand that today’s revolutions have no moral justification and are all gang warfare.  As such, in order to change our immoral systems of government we require to first our own immoral code of values.  This means that we need to learn our history and fix all those immoral decisions taken in the past by our former enslavers.

I believe that the ideal way for starting to learn which is the code of values that provides for a consistent philosophy of life that protects individual rights and allows for humans to pursue happiness is the philosophy of Objectivism and the Objectivist Ethics.

If successful, most probably, the ongoing revolutionary movements in the Middle East, Ukraine and Venezuela will reflect to be nothing but immoral putsches of the very same old privileged groups that they were supposed to fight.  Corruption will take a new name, the citizens will be again defrauded by their leaders, immorality will again reign.  the power currently upheld by immoral leaders is not a simple system of domination of one specific group but it completely traverses the entire social body.  When social relations are not based upon a consistent and ethical code of values its result is “the immanence of force” that Foucault widely studied.    In this game of power, the incessant struggle and confrontation will be reinforced, transformed and reshaped without any meaningful outcome.  This never-ending cycle of revolutions will encrust and institutionalize itself if it hasn’t already. I truly believe that a Peaceful Philosophical revolution is Possible.  It is up to you reader, to chose wether to start it or not.

Gun control, school massacres and state-failure

The article “More Guns = More Killing” By came to my attention as a good reference of how sometimes more “global approaches” to what we could explain as “local problems” results in sophistic arguments that are of no use.

The article is astonishingly confusing and misleading because the author arguments that it is more/less guns what results in more/less deaths.  And as such, that only by decreasing the amount of available guns the deaths can be reduced.  In order to defend this position she tries to defend her position by bringing a sometimes useful comparison of explaining local problems (those of the U.S.) by comparison to more global regions (in this case, Latin America).

Rosenthal does not propose a better solution than the one she is trying to question and which was proposed by the NRA (National Rifle Association) to President Obama.  Truth, “A society that is relying on guys with guns to stop violence is a sign of a society where institutions have broken down”. Why? Because the bureaucrats and the NRA consider as she does that it are guns the ones that “kill” and as such, it are guns the ones that “give life“.  Neither of the cases can be more false.
The parallels between the Latin American countries with high homicide rates and the US Massacre of schools kids cannot be correctly understood behind the “more guns/less-more deaths” causal relationship.

Then, how? As usual in this times of miss-integration of concepts.  The events in Latin American countries with high homicide rates and the US Massacre of schools kids have no parallels.  The high homicide rates in Latin America are the result of a failed War on Drugs and the institutional decay caused by corruption, state failure in providing rule of law and the reconfiguration of power relations amongst many other causes.  In this case the guns are not a cause nor a solution.  The massacres in U.S. schools are in my opinion the result of a decay of family values and a philosophical problem of identity that can only be solved behind an urgently much needed moral revolution.  In this last case it is not guns or the state which can do much about to change things.

Future massacres in schools can only by stopped from happening when the roots of family decomposition are diminished (divorces, unemployment, family violence, alcoholism, drug addiction, among many others).  The murderers in these schools were seeking for revenge from society and saw that killing kids was the perfect way of enacting revenge on those he was angry with.   Until we understand this things I see no probable hope for future improvement of any of the cases. As well, for as long we have journalists with a philosophy of life that relies on the State as the “giver” or “healer” of society’s problems things are also going to continue going in the wrong direction…

Afghanistan during the 50s vs Today

A friend in Facebook posted yesterday an interesting link that read Afghanistan of the 50s-60s”. The description of the website read that “having seen the title of the post, many probably thought that it would be about a wild, backward, medieval country with even worse living conditions…”  However, the photographs in the link failed to “demonstrated” that Afghanistan pre-1950s was some type of a paradise before the Socialist invasion.

While the images show a “decent and civilized” view of Afghanistan in the 50s and 60s they are only a glimpse of the reality of the Asiatic region and of many other European colonies around the globe.  It is a fact that the great majority of the people during colonial times lived in worse conditions than during the Cold War.

As a result of centuries of this mix, Afghanistan was one of the poorest and most illiterate countries in the globe by 1950.  The life expectancy for both men and women was of only 29 years and the average GDP/per capita inflation adjusted was of only $800.00.

By 1970, Afghanistan was still one of the poorest countries managing to increase the life expectancy to only 33 years and the average GDP/per capita to $833.00  Today, Afghanistan has some of the lowest rankings of health, education and economic growth on Earth even after decades of investments done in infrastructure by the Soviet Union during the Cold War’s competition vs the United States.

Soviet investment during the 50s in Afghanistan

 What caused this economic and social stagnation vs the rest of the World?

Afghanistan is a complex historical mix of:

  • Centuries of imperialistic control (Mongol, Mughal, British, Soviet, American) +
  • autocratic tribalism +
  • religious intolerance  +
  • control of the economy by the state +
  • regional oligarchies +
  • disrespect for individual rights

The previous only kept increasing and by 1973, Afghanistan was what some would define a modern democratic state with free elections, parliamentary ruling, civil rights, women’s rights and universal suffrage that failed to improve the life of its inhabitants.  Becoming a democratic state with a parliamentary ruling is of no help when the ruling philosophy of a country and of its ruling elite is based on the principle of freedom to violate individual rights.

The past was not necessarily better than the more recent past or the present. Afghanistan is a good example of this last sentence. Whenever  individual rights are sacrificed for the interests of national of foreign groups of interests the positive outcomes will always result in detriment of the individual.  It has always been groups of interests who benefit from the illiterate masses and historical examples explain this plentifully.

The images in the link mentioned above are inaccurate historical accounts. I consider that the following cartoon is very clear in explaining the complex and unfortunate story of the country and I invite you to study it,

Discourse: Nationalization, Private Companies and Crony Capitalism

The neoliberal (a.k.a. crony capitalism) ruling of the world during the last 50 years is usually generalized as a “big fish eats small fish” relationship. The story continues, with the big fish in Washington, Brussels and Moscow fed themselves with the riches of the world and profited from globalization.  Meanwhile, the small fish continued breeding and feeding the always hungry lords.  This general discourse is repeated in most if not all the academic papers dealing with postcoloniality and globalization.

The impact of the ideas of these intellectuals is widespread and not easily observable for the ignorant masses.  As such, when you read the newspapers in Latin America or Africa in regard to the “new” nationalizations being undertaken by the “new” socialist/anti-neoliberal governments in Argentina, Bolivia, Brazil, Greece, Lithuania, and Sri Lanka since 2011 people usually ignores that there is nothing “new” in these actions.

These nationalizations of privately owned assets have been in many of the cases actual renationalizations of companies that were not owned by the principles of free market ideas, but that had been privatized by corrupt social democratic governments 50, 40 or 10 years before and who created new privately owned privileged companies.  As a result of these social democrat and socialist governments many privately owned companies emerged as the bastions of crony capitalism, inefficiency and corruption.  The previous, generally increased as closer the national industries were owned by crony private companies that owned single-crop cultive exports and resource rich regions.

To mention short examples of the previous, recently in Argentina Yacimientos Petrolíferos Fiscales (YPF; English: “Treasury Petroleum Fields”) was renationalized (not nationalized) by the government under claims of corruption, inefficiency and negative benefits to their national interests.  In Bolivia, Transportadora de Electricidad (TDE) was nationalized by Evo Morales government.  However, TDE was also a fruit of the neoliberal and crony capitalist deals established in 1952 after a coup d’état that established a military socialist democracy with the party  Revolutionary Nationalist Movement (MNR) which allied into a military-nationalist clique that lasted for 50 years.

Privately owned companies produce always more efficient and better products than state-owned companies.  However, privately owned companies that have benefited from government granted privileges for decades not necessarily will produce more and better services and products than state-owned companies.  The previous is something that few of us dare to identify and explain with a non-contradictory historical and philosophical background.  Meanwhile, the great majority of academics influenced by collectivist philosophies will start writing articles and books applauding the “successful” renationalizations and condemning those free-market authors who will write back and fight.

Indeed, there is a difficult road in defending private property and privately owned businesses in the context of countries and regions that lack respect for individual rights and the rule of law.  As such, to defend the private vs collective in those circles it is necessary that first we identify how the societies are currently organized around the collective inefficient systems of social and economic organization.  In the case of Bolivia and Argentina it is necessary for us to identify how these business and societies are not structured and organized around the principles of free market and individual rights.  By understanding and explaining this clearly there will be a chance to change the discourse of discussion from “why is renationalization good?” to “why laissez faire capitalism is better than the privately owned business of crony capitalism?”

Inequality in India

By 2011 the BRIC economies had some of the highest rates of income inequality adjusted to the Human Development Index among developing nations.  At the same time, the BRIC countries had consistently had the highest GNP growth versus the previous 10 years among developing nations.  How is it that there is not a parallel growth of the Human Development of its citizens?  The answer and one of the biggest challenges for the BRIC countries is the fact that a large amount of the GNP is distributed among small elites that control their market economies.

Economists and investors such as O’Neill, Krugman and others largely emphasize the expected growth of the BRIC economies as indicators of where to invest their money.  Unfortunately, they have not paid the same interest to what many other economists consider important: the human development of the people.  Fortunately, there are still some economists who since the decade of 1970 paid a lot of attention to the issues of freedom and equality.  Economists leaded by Milton Friedman, the Economics Nobel Prize of 1976, argued that economic policies should be focused in the freedom of its citizens as a primary value.  To them, stressing equality per se could lead to economic inefficiency as well as it would put in risk Freedom itself.  However, the same economist argued that it was necessary for developing economies that the government took a central role in poverty alleviation in order to keep the pace with the economic growth of its economies.  Unfortunately, this poverty alleviation is not being done in the BRIC countries and the economic difference between the poorest and the richest continues to grow. Since the 60s, a large group of economists emphasized the negative effects of not paying attention to a free and equal development in emerging markets; economists like Friedman and Hayek wrote a lot in this regard and even recently Elinor Ostrom’s ideas, who won the Nobel Prize in Economics in 2009, are still not listened by those who have forgotten the importance of good governance economic policies.

India is the country in which this income inequality versus human development is more pronounced.  Currently, India occupies the position #93 with an IHDI of 0.392 and the country has descended in the rank many positions since the last decade.  Inequality in the earnings among Indians has doubled over the last two decades, making it one of the worst performers among developing economies.  Why? This is again the result of the failed attempts by the Indian government to combat corruption, bad administration and under-payments and also of the unawareness of foreign investors.

The fact that foreign investors have no interest in securing the welfare of the Indian people is a problem.  To them, the investment opportunities of this specific BRIC country are of value until they find a better economy to move their money to.  However, the real stakeholders are not the foreign investors but the Indian Government and its groups of interest who should aim to secure the welfare of all of its citizens now that they have a chance.  While the growth of this economies will continue the effect it will have in such unequal societies will result in some of the worst rates of poverty and hunger ever seen in history. By 2025 India will be the most populous country in the world but also, it will have 268 million people (20.3%) living still with less than US$1.25 a day as reported by economists in the World Bank. The Indian government should go aligned with the current trade liberalization in order to support higher productivity in the private sector and to exploit its comparative advantage of having a labor-intensive industry to foster the production of goods and services.

Drugs: A Legal Market is not a Free Market

English: Flower of a Opium Poppy
Image via Wikipedia

A couple days ago, Otto Perez Molina, recently elected as President of Guatemala; announced that he was willing to decriminalize the commercialization of drugs. According to U.S. authorities, Guatemala has became the transshipment point for more than 75 percent of the cocaine smuggled into the United States since 2005.  Along with this, the Opium poppy cultivation is already done in large parts of the countryside making the production of Guatemalan heroin a greater and the newest worry for the United States. The country’s elites are already part of this business and the paranoia of crimes that used be a remembrance from Colombia‘s 1990s history seems to be repeating in these Central American countries.

What impresses me the most now is how this news has started spreading around my Facebook contacts (mostly libertarians and liberals). Both groups seem to be happy to hear this announcement by Guatemala’s President.  However, both groups applaud the news for different reasons.  The legalization/decriminalization of drugs will not be the panacea we all are hoping for.  Specially not if started by any of the Central American governments.  The reasons are many and I will begin by listing some of them to open the discussion,

  • Corruption, lax enforcement, and judicial impunity levels in Central America are among the highest of the world.
  • Drug lords and their new and powerful money have been mentioned by many analysts to be already part of the politic and economic elites of these countries.
  • The Central American countries in which this drugs are produced and transported are inhabited by a large majority of people living in the lowest leves of Human Development.
  • If legalized, the trade, production and commercialization of drugs (cocaine and heroine mainly) will be regulated by these governments.
  • Without any doubt, this regulations will enable and create legalized monopolies ruled with the partnership of previous drug lords and government officials.
  • It has not been advocated by any of the political leaders which road would take the legalization of drugs. This is important, because under current legalization procedures it is not the same to get the approval for a new medicine in the market as to get the approval for a new liquor, a new energizing drink or of a new edible product.

The history of the legalization (production, trade and commercialization) of items considered by many as drugs and for others as commodities has shown that for as long as a government elite hold the power to legalize it; it was in their power to take the first steps into the acquisition of a monopoly of its trade and production.

If legalized, the emergence of a coercive monopoly would be inevitable. As noted by Ayn Rand, the governments and their partners in these coercive monopolies “will be able of setting the initial prices and production policies independently of the market, with immunity from competition, from the law of supply and demand. An economy dominated by such monopolies would be rigid and stagnant.”

If we support the complete and absolute free trade of all commodities it is necessary that we do not grant to government an intrinsic right to regulate it.  No compromise should ever be done with a government that requires regulation in order to give us legalization.  Legalization should result in freedom and not in regulation.  The drug trade should be opened to businessmen and entrepreneurs in the freest way possible. The freest way is that of requiring the traders to inform their buyers about all the necessary information about the products they are offering.

We may be taking part in a historical moment in which the most important thing are principles.  Let us remember that one of the most valuable principles of trade is Freedom; and that one of the most valuable principles of government is to seek that i will Protect Individual Rights and not to regulate their lives.

Note: To understand more which are the principles that really matter in this discussion, I invite you to take a look to the video titled: The Drug War in Guatemala: A Conversation with Giancarlo Ibarguen.