Monday, June 20, 2005

Profile in the Sacramento Bee

To any readers interested, the Sacramento Bee published a little profile of me on Saturday. The reporter came and followed me around Cochabamba a bit a month ago. My mother seems to be happy about it so I’d thought I’d pass along the link. Here’s the article.

26 Comments:

Anonymous Paul V said...

For those of you who haven’t seen the article, flipper/flipper will get you in.

I guess it is difficult to be objective about nationalization if you are “now a leading activist protesting the negative effects of globalization, including free-market reforms and international lending practices he blames for social unrest, bloodshed and deepening economic suffering for the poor in developing nations.”

“Oscar Olivera, a union organizer and a fiery leader of the Cochabamba water protests ... now works out of an office at Shultz's Democracy Center.”

Since Shultz “founded the California Budget Project to dramatize the impact of state spending decisions on the poor,” he should have an interest in numbers. I’d like to take this opportunity to hijack this thread and possibly start a Bolivia Budget Project. Unfortunately, I am having a difficult time determining exactly what is in Bolivia’s budget. It would seem important to try to figure out where money in Bolivia is actually coming from and how it is being spent, before you go an topple a government. I’ll admit that the data below barely scratches the surface and present as more questions than they answer, but it’s a start. Since nationalization of hydrocarbons is also a popular request, I would think a hard look at the numbers in Bolivia’s natural gas industry is also necessary.


Debt Information

From http://www.wemos.nl...

2004 Debt
  4949 million Total debt, December 2004
  548 million New loans, 2004
  277 million Debt service payments (5.6% average interest rate, apparently)
  271 million Net transfers (money received by Bolivia)

Contrary to what is commonly said, I don't see how Bolivia is currently "suffering" from high debt payments.


Budget Information

From www.imf.org/external/country/BOL/ (page 10)
I multiplied the percentages given by a GDP figure of $8.954 billion. This figure may be high, as I have also seen an estimate of $8.465 billion. The value of the dollar and the boliviano obviously play a part.

2005 Estimated Revenue and Grants
  350 million Hydrocarbon royalties (does this reflect the 18%, or only the 7% the national government gets, or does it reflect taxes as well?)
  240 million Fuel excise taxes (who are these are charged to?)
   81 million FTT (Free Trade Treaty?)
 1270 million Other taxes (this is a significant number--how about a breakdown!)
   580 million Grants? (where do all these grants come from?)
 2520 million TOTAL

2005 Estimated Expenditures:
   45 million Fuel subsidies
  440 million Pensions (Bolivia's own unfunded pension system?)
  780 million Wages (a breakdown would be helpful!)
  840 million Capital spending (what capital spending?)
  880 million Unspecified (is this Evo Morales' debt payments?)
 2970 million TOTAL

2005 Deficit
  460 million


Debt service payments can either be $271 million or $880 million, but not both. If they are only $271 million, what is the 880 million being spent on?

Are there Spanish-language sites with better information about the Bolivian budget?

Why aren't international gas sales contracts in the public domain? Why doesn't the Bolivian government publish the price and the quantities of gas and oil being sold, and the amount of royalties and taxes being collected?

So Bolivia receives $580 million in grants and $350 million in hydrocarbon royalties, yet still runs a $460 million deficit? That can’t be good. OK, I’m not sure about the grants.



Natural Gas Information

The Bolivia-Brazil (GasBol) pipeline alone is supposed to be able to carry 30 million cubic meters per day of natural gas. Assuming it operates 24/7, that would be 310 billion cubic feet per year. At $3.50/mcf, half the price of U.S. natural gas, that would be $1.085 trillion dollars worth of gas. In addition, associated oil production has been estimated (not necessarily correctly) at 6.6 million barrels per year. At $50/barrel oil, that is $330 million.

From www.timesleader.com/mld/timesleader/news/world/11866853.htm...
Of the almost 1.2 billion cubic feet of natural gas produced daily, about 80 percent goes to Brazil, about 10 percent to Argentina and the remainder stays in Bolivia, said Carlos Alberto López, a former Bolivian energy secretary who advises foreign companies.

From www.csmonitor.com/2005/0608/p01s01-woam.html...
According to Mr. López, Bolivia currently exports approximately $830 million per year of gas to Brazil and Argentina.

So 90% of the 1.2 billion cubic feet of gas per day is exported, or 400 billion cubic feet per year, at a sales price averaging $2.15 per thousand cubic feet. It might cost Petrobras et al another $1 per thousand cubic feet to deliver the gas to markets in Sao Paulo or Rio, etc (assuming this is the marginal cost to deliver the gas, which might not be correct). In order for Petrobras to pay back the cost of the pipeline, they would have to sell this gas in Sao Paulo for more than $3.15/mcf.

According to bakerinstitute.org/Pubs/study_24.pdf” http://bakerinstitute.org/Pubs/study_24.pdf">bakerinstitute.org/Pubs/study_24.pdf , page 8, Brazil is buying less gas but paying more for it...
The original 20-year deal in 1999 stipulated a basic price range of U.S. $0.96 to $1.50 per thousand cubic feet and maximum volumes of 750-850 MMcf/ d or 30 MMcm/d, but Petrobras is now importing about one half of that amount, and with the Brazilian currency’s depreciation against the U.S. dollar, it is stuck paying the equivalent of U.S. $3.60 per thousand cubic feet.

From http://www.marxist.com/Latinam/bolivia_after_ref0704.html
The negotiation of this latest contract - that witnessed the personal intervention of Nestor Kirchner, the Peronist President of Argentina - was signed in the city of Tarija, in southern Bolivia on July 21 (www.econoticiasbolivia.com July 22, 2004). The contract allows for the sale of 6.5 million cubic metres per day from Bolivia to Argentina. The Bolivian state will only receive 10 US cents per 1000 cubic feet of gas.

This translates into the potential for another 67 billion cubic feet per year of natural gas sales, 44 billion cubic feet per year of which are apparently included in López' figures.

GasBol's pipeline capacity of 30 million cubic meters per day equals 850 million cubic feet per day. According to López, Bolivia exported 960 million cubic feet per day to Brazil. Gasoducto Cuiabá could make up most if not all of the difference.

Before getting carried away with U.S. pricing, it should be noted that Argentina sells its hydrocarbons for far less money...

From http://www.repsolypf.com/eng/todosobrerepsolypf/saladeprensa/noticias/ultimasnoticias/noticias.asp?PaginaID=100088

The Repsol YPF liquids realisation price averaged $31.52 per barrel versus $28.5 per barrel in first quarter 2004. The average price of gas in the quarter was $1.48 per thousand standard cubic feet (tscf), 23% up year-on-year, reflecting higher average gas prices in Argentina and an increase in sales volume in Trinidad & Tobago.

2:25 PM  
Blogger Sean said...

I think the fact that there is a lack of clean accounting is basically a big point FOR toppling a government. If you can't even tell whose paying whom, and from where, its rife for corruption, kickbacks, and outright theft.

And the dig at Jim as not being "objective" ignores the fact that, well, no one really is. The IMF and the World Bank aren't, as the economists and policy wonks that staff them have just as much of a slant as Jim does. They have a belief in their policy reforms, aims, and goals. They clearly espouse a free market and a deregulated, privitised country. I'm not saying these things to just piss off the apparent acolytes of these ideas on this blog, or to start a rousing leftist diatribe (though I do disagree with the institutions), but to indicate the reality of what these instituions opinions are. I think you would have to be dense to suggest they don't promote these things. Some people view those as good, some as bad, but thats what they promote. The fact that they come from the UN System and don't have overt political connections doesn't wash them of ties to clear schools of economist thought.

For all the wanking by the Economist and others of "leftist" NGO's somehow running revolutions in the global South, why is no one complaining about the seeming lack of economic thought diversity at the IMF/World Bank, whom has a far larger budget than any NGO does? Where are the leftists in the IMF/World Bank, and why are they discluded? If its because their supposed economic policies don't work, well, the IMF and the World Bank don't exactly have a stellar track record either under their current free market leadership.

But admitting the IMF/World Bank has a bias would put a bump in the constant rigaramole about "leftist" attempts to rose tint and mess up developing economies who are being guided by the supposedly enlightened at these institutions. Moreover, it would point out their suporters as just as partisan and loaded with political baggage as the people they claim to be shrilling nutjobs. Mind you, there is a tendency for some academic leftists to simplify everything into "peasent revolution" vs. "big bad corporatists", but then again the oppositions red-baiting and shrills of "uneducated" and malevolent Indians run amuck is about as cogent as the rose tinted world view.

4:04 AM  
Blogger Andrew T. said...

Of COURSE the IMF has a bias.

They have a core set of beliefs about the way the an economy should work. That's their frickin job.

You can disagree with those beliefs (though most economists don't), you can call for moderation and some fresh ideas (probably a good idea). But to expect the IMF to not have a clear bias - not even a bias but a clear policy directive - then what the heck would the point of the organization be?

Has it occurred to you that maybe people who have studied this a lot sort of come to the same conclusion? And that maybe, just maybe, they've come to that similar conclusion, not because they are raving maniacs, but because that conclusion looks to be correct, or at least partially correct?

As for their track record - I don't know, my admittedly uniformed thoughts are that the problems have a lot more to do with internal corruption, overall malaise of the entrepreneurial sector, lack of affordable credit, and poor education than IMF policies.

And if we're comparing track records, you might at least consider whether what Evo, et al are proposing has a better one.

Finally, saying that Jim has a slant and the IMF has a slant and thus they are functionally equivelant is like saying that NASA has a slant about space travel and my son and I have a slant about space travel and so each of those has the same validity.

10:57 AM  
Blogger Andrew T. said...

BYTW, no one called them "malevolent indians".

And there's not reason to quote mark uneducated.

Most are uneducated. That's just a fact.

12:03 PM  
Anonymous boliviano en usa said...

i think any efforts to gather data about the actual economic situation are extremely necessary and wise. we know politics is full of corruption, nepotism, cronysim, etc. we know that injustice and racism pervade the social climate in bolivia. the only way rational, well-meaning people can find a solution is if we know what the heck is really going on. sidenote: i don't think carlos mesa telling us that if we p.o. the 'international community' or 'la cooperacion' then he can't pay teachers or doctors is enough. why?

i constantly have arguments along the lines of: well, what would evo do differently?? with family and friends. unfortunately since we don't have any true, hard facts it comes down to the left/right bickering i see developing in this thread.

my initial intention was to express my appreciation for these investigative efforts, i'd like to emphasize this before i indulge in the urge to say: the imf is a far cry from being to economics what nasa is to space exploration. they have never succeeded in their stated goal of helping out a country. except when money was poured in to an already 1st world, educated europe after wwII which just needed the cash, and it was with few strings attached.

2:06 PM  
Blogger Sean said...

Of COURSE the IMF has a bias.

Yes, in fact, thats what I said.

They have a core set of beliefs about the way the an economy should work. That's their frickin job.

Yes, I understand that. They have a core plan of how they go about fixing or aiding countries. And yes, that is their "frickin job".

You can disagree with those beliefs (though most economists don't) you can call for moderation and some fresh ideas (probably a good idea). But to expect the IMF to not have a clear bias - not even a bias but a clear policy directive - then what the heck would the point of the organization be?

I'm not saying they should or should not have a clear policy directive. What I AM saying is that people who try and get away with playing the IMF/World Bank as these amazingly neutral, consensus type organizations, as opposed to those "nasty" and "crazy" NGO leftists are balls out lying. They have an agenda, and no, they aren't the bee's knee's of the world's economists, and no what they say shouldn't be completely taken as impartial and neutral without a certain amount of critical examination. I mean for god sakes, people get second opinions on medical diagnosis, and we have one single opinion basically running development and loan programs?

Has it occurred to you that maybe people who have studied this a lot sort of come to the same conclusion? And that maybe, just maybe, they've come to that similar conclusion, not because they are raving maniacs, but because that conclusion looks to be correct, or at least partially correct?

Actually no. Why? Because the people at the IMF/World Bank don't represent some sort of great economic consensus. In fact, you would be hard pressed to find in any of the "softer" sciences (and hell, most of the hard sciences) to find some hard, fast conclusions about anything. There a wide variety of educated, well versed economists who disagree on a number of issues. Despite the attempts of newspapers, and some of the commenters on this board, the "deregulate, privitize" and "Free trade" economists are not the New Consensus, but merely the ones who have managed to find their way into positions of power, for whatever reason.


As for their track record - I don't know, my admittedly uniformed thoughts are that the problems have a lot more to do with internal corruption, overall malaise of the entrepreneurial sector, lack of affordable credit, and poor education than IMF policies.


I don't think anyone, particuarly leftists of any stripe, would argue that the only problem is the IMF. But if the IMF excerbates problems or makes decisions that end up backfiring, it should be held accountable for them, and serious analysis and criticism of what went wrong should result. That doesn't happen. The IMF and the World Bank just plod along, recommending the same things over, and over, and over again. No one's saying, wait, maybe we should take a look at what caused these huge problems and if we had anything to do with it.

Moreover, the IMF, as an international institution, and one that America contributes too heavily, should be analyzed for faults, simply because some of our tax money is going there.

Finally, saying that Jim has a slant and the IMF has a slant and thus they are functionally equivelant is like saying that NASA has a slant about space travel and my son and I have a slant about space travel and so each of those has the same validity.

Actually, I meant the broader NGO community and those who oppose the IMF/World Bank when I talked about both sides being biased. So, no, your comparison is not apt, and also incredibly insulting. Jim may have an agenda, and you might accuse him of being some sort of rose tinted academic leftist. But to insinuate basically that he is wholly without a valid opinion on the issue is ridiculous. But then again, like the Economist article, we know that those dirty NGO leftists are funding revolution against the enlightened economic wunderkinds. For shame on you Jim!

3:09 PM  
Blogger Andrew T. said...

OK Sean, back off for a minute. I can see that you're not leaning heavily one way or another and that you're trying to argue for accountability and alternatives. In most ways we're on the same page.

My core issue is NOT supproting the IMF or World Bank (though I tend to support free markets) but expressing my frustration with the protestors and the facile and easy answers spouted by the "lefties".

My bottom line is:

1. The protesters are hurting the democracy.
2. The protestors and many posters here are basically talking out of their ass about economics they don't understand.
3. Combining #1 and #2 you might characterize them (to reduce it to a brutal phrase) as ignorant and undemocratic.

Let me contrast that to another way of resisting the status quo - by being educated and democratic.

If we have people who have a real policy options that present a valid and workable alternative to the status quo and to the IMF, and they are willing to fight for that option through the existing democratic system, then I'd love to support that.

I myself have thought about lots of quasi-statist options that might potentially work.

You give me an IMF economist and "reform" economist and a new-deal economist and we've got a debate.

Give me an IMF economist and a hippie yelling "capitalism is the represive instrument of a transnational conspiracy to opress the poor" and that's not constructive - it's just a waste of time.

I don't give a rip what the hell the solution is, as long as we find one.

But I think the protestors and the "lefites" here are taking us further and further from that solution. And in the end they are a bigger threat to peace and prosperity for all Bolivians than the IMF or World Bank is.

As for my particular post:

I never said Jim's opinion is wholly without merit, so I don't see the insult. My point is that, unless I'm incorrect and Jim or anyone else is free to correct me on this, Jim is not an expert in economics, and therefore his views on economics should be taken somewhat like my own - as an interested observer. And as interested observers, I believe our opinions hold less weight than those of people who've spent a lifetime wrangling with and studying the issues.

And I do think that too much of the NGO community falls into the "interested observer" catagory.

And, again, as I stated before, I'm not saying that NGOs "fund revolution" but they do frequently feed into a certain political line. In my experience, that's empirically true.

I'm not here to defend the IMF per se. If they're fucking up, then I agree the should be held accountable. The same metric that Evo et al should be held to. I'm all for accountability. I'm all for alternatives.

I'm just sick of people who have basically never taken the time to really work through the complexities of economics (and I'm not referring to Jim per se) blathering on and on about the evils of capitalism and the world bank when they couldn't really tell you the first real thing about the brass tacks of how it actually works and WHY some people who've studied this long and hard actually think it's a good idea (or even a real grounded policy understanding of why others think it isn't).

I recall in Bolivia, during Goni 1 students were protesting like mad over privatization. They were out burning tires in the street and screaming about defending Bolivia, etc. Same general tenor as now, and I'm sure most of the "lefites' here would have been estatic about them and their support of all of these wonderful ideals.

Well, I had some of my students do a research study about student attitudes regarding privatization and the reasons for their protesting (which was pretty ferocious at the time). The bottom line was that essentially none of them could tell you a single god damned thing about what privatization was or how it worked. I'm not talking in depth economics, I'm talking back of the envelop, broad strokes stuff like "what is privatization". All they could do is spout reams of pre-fab anti-American, anti-capitalist jargon.



I'm not sure the IMF/World Bank line is the solution, but I do believe strongly in free markets, smallish government, and capitalism. (and, btw, living in Bolivia is what convinced me of these things). While there is probably not an economic consensus that the IMF/World Bank approach is dead on, there is almost universal consensus that the general policies of free markets are right and that Evo et als way of doing it is wrong. (right and wrong, in this case, meaning "most likely to create long-term economic prosperity for the majority of Bolivians") I believe most of the debate is not on broad strokes issues, but more on implimentation, speed, flexibility, etc.

And for what it's worth, I'm hardly a flaming right wing nut job. I got my undergrad in Anthropology from the University of Wisconsin (commie central), wrote my undergrad thesis on indigenous Bolivian argricultural technology, and spent the next 6 years working at a grass roots NGO working to secure land rights for indigenous people in Southern Bolivia.

4:00 PM  
Blogger Sean said...

But I think the protestors and the "lefites" here are taking us further and further from that solution. And in the end they are a bigger threat to peace and prosperity for all Bolivians than the IMF or World Bank is.

See, thats where I disagree. While I have met and rail against the idiotic and simplistic assertions of many of my own political stripe, I consider that a mostly due to immaturity, inexperience, or a frustration with how things are going (beat a dog into a corner enough and he WILL lash out). But I don't like the other guys that much either, and I certainly don't follow their cause.

But the argument I think you present is disingenous. Much like the dog example above, can you really blame people for going batshit loco when things aren't going their way? It's easy for you and me to sit here and discuss how this should be done in "democratic" ways but we're not living with their experience. Nor do they have the multitude of options we have. My point is, if you are pushed far enough, hell you just might start riots in the streets. All the pedantic ruminations from arm chair policy wonks (and thats what BOTH of us amount to) are exactly that. And I also thinks its unfair.

Time and time again whenever you see a group of people who are basically the underdogs or the ones getting screwed, and they tend to react in overzealous and ridiculous ways, everyone whose not in their shoes shakes their head and talks about how "They aren't doing it right" or they aren't being "democratic" or "non-violent" or whatever sad sappy criticism they're lobbing at them. But then you hear about some paramilitary assault on a bunch of campesinos or you hear about American military aid going to dubious governments, everyone just shrugs their shoulder and says "thats how it goes". If you're going to accuse the indigenous movements of being un-democratic, than I suggest you apply it to EVERYONE regardless of their political affiliation or social status. I think me and you agree on this. I think some people who comment here don't want to see that, and presume that since alot of these IMF/World Bank people come form educated, and developed countries that somehow they CAN'T have a penchant for authority run amuck or oppressive policies. or the well heeled, American educated elites can't be as equally oppressive.

At the same time just becuase someone brands themselves leftist and talks about "the people" does not a egalitarian movement make. Trust me, I've met my fair share of authoritarian and power hungry people amongst organizations that supposedly are for "democracy" and "equality". And I call those people out on it too and rail against them.

I agree that many leftists and protestors can come off as crazy. And I for one have always argued for a better, more through take on issues at hand other than "Capitalism Sucks" (a sentiment I echo for a variety of reasons, but not just reflexively because I hate corporations). But I think so do many right wingers, and free market acolytes (just look at the Libertarians!) are equally nuts, they just don't holler in the streets (but rather make backroom deals in government offices).

For all of the poor people hero worshiping, inaccurate and sometimes uninformed statements of various anti globalization people, and the sometimes absurd and ridiculous tactics, my heart and my brain are with them. I was in fact a believer in right wing economics and free trade for a long while till meeting a group of educated, experienced individuals who espoused differently. I then took a look into it myself and though obviously I don't understand everything, or even feign to do, I side with them.

And I think there ARE alternatives to the current order that are legitimate. People broadstroke the opposition (just like protestors on the street broadstroke theres) as inchoate, rambling dips. But arguments against trade dumping ( a major cause of economic problems in many developing countries), the issue of subsidies in developed countries that put poor countries at a disadvantage (why do developing countries have to cut subsidies yet the USDA basically bankrolls the agribusinesses?), the issue of the soviergnty of countries to decide their own environmental and labor policies without threat of being sued under some obscure trade jursidiction? And why is privitization always best? Wouldn't it be better to make public ultilities and service more democratic and have more oversight, rather than just sign contracts with companies? Many Public Utility Districts in America are examples of avoiding the problems of state sanctioned monopolies without letting deregulation run amuck. You have both oversight through board control and purse string issues via referendum. I consider THIS to be superior to simply signing a contract or simply opening up the market for sale and to the whims (and predators) of the various energy traders. There are many other instances of public, oversight and controlled services being superior to the simple matter of singing a contract to give it to a company.

5:08 PM  
Blogger Andrew T. said...

Yep, Sean, you and I mostly agree.

A couple of observations though:

I can't blame people for "going apeshit" when they live a lousy life and have few if any options. BUT two points:

That doesn't necessarily get us towards a solution. I know that's easy for me to say, but in the end, venting anger and frustration (if that frustration ends in damaging your prospects for the future) is hurting things. I think an issue people are not paying attention to is the fact that a lot of this is happening *because* the democratic system sort of worked. That's what gave Evo a lot of the power he now has. The democracy WAS working.

Secondly, it CAN be done differently. As I noted in another post, when I was in South Africa it was incredibly instructive to see how they managed to move forward from a far worse situation without tearing each other to shreds - mostly due to the leadership of Mandela.

Asking Evo to be Mandela is a lot, but maybe the dire straights in Bolivia requires that kind of leadership. The kind that says we are all Bolivians, rich and poor, Tarija and La Paz, indigenous and white, and we're going to stop hating each other and yelling slogans at each other and sit at the same table and hammer something out.

As for your move from being a free marketer to a more "socialist" guy, I mirror the opposite trajectory. I was a pretty left leaning guy until I spent some time in Bolivia and really reflected on what was happening around me.

I'm very invested in there being a good solution, where Bolivia gets ahead. In fact some of my personal dreams involve going back to Bolivia and implimenting a training school on natural resource extraction techniques (just kidding - my dream is to start a grade and high school and a soccer team... long story)

And the big thing that you mention about the way the system is F'ed up - agro subsidies, dumping, etc. My main argument has always been that you shouldn't confuse the bullshit that any given country or company can do with the free market.

Unfortuantely, people generally associate big business with capitalism and the free market when in fact the grosses abuses of these organizations is precisely UN-freemarket. Microsofts business practices are NOT freemarket - they are abuses. French agro-subsidies are NOT freemarket. They are closed market. The US steel tarrifs are NOT freemarket. A company undercutting a local producer by subsidising prices and driving them out of business is NOT freemarket.

Those are all abuses of free markets, which is a different thing.

I don't believe free markets and capitalism are inherently bad (I believe freedom constrained by law is almost always good) or even that the accumulation of extreme wealth is in itself bad (obscene maybe, but not bad). The true problem is that economic power leads to the opportunity to amass politcal power which leads to the ability for unscrupulous people to curtail freedom again.


Finally, I think that some sort of quasi-statist approach MIGHT work in Bolivia, but the problem is any statist system is boged down by corruption and - frequently - inefficiency.

I don't know if you've spent time in Bolivia, but one of the privatizations that's worked wonderfully (at least from a consumer standpoint) is Entel. Anyone want to go back to the pre-privatization prices and service? I doubt it.

I don't know how much economics you've studied - but take a look at the concept of "dead weight loss". Really interesting concept that was a novelty to me when I learned about it this year. It makes a lot of sense and sort of puts numbers to the concept of the drag that taxes and general government meddling in economics puts on an economy.

BTW I've got some very serious criticisms of the free market, but they come out of having finally understood it pretty well and basically they come down to this - free markets rock ass, as long as you're able to participate in them. Poverty on an individual basis keeps you out of the game, which is bad news.

I'd sort of go with what I believe Milton Freidman's argument is - the problem with places like Bolivia isn't that the free market is killing it, but that it's being forced to be on the sidelines.

6:18 PM  
Blogger Andrew T. said...

BTW you remind me of Dan on this same board - someone I can respectfully disagree with.

6:20 PM  
Anonymous eduardo said...

Andrew T wrote:

"I don't know if you've spent time in Bolivia, but one of the privatizations that's worked wonderfully (at least from a consumer standpoint) is Entel. Anyone want to go back to the pre-privatization prices and service? I doubt it."


- Exactly, the Bolivian government has no business in the telecommunications, railroads or airlines. But i think the issue of water and hydrocarbons should be treated differently.

SEMAPA in cochabamba still cannot guarantee water and sewage to everyone who needs it. why? because they have no money. What's the solution? No one really seems to know.

I think it's okay for the government to subsidize this to guarantee a certain amount of water to everyone, and if you go over that amount then charge people.

God, the days of ENTEL were terrible. Paying $1000 for a telephone line was obscene. Now you can rent a phone line for 5 bucks a month.

10:20 PM  
Blogger Andrew T. said...

Took me five years to pay off my line... yikes!

11:25 PM  
Blogger Andrew T. said...

Though I should mention that I didn't pay ENTEL, but rather COSETT, the local cooperative....

11:25 PM  
Blogger Sean said...

The true problem is that economic power leads to the opportunity to amass politcal power which leads to the ability for unscrupulous people to curtail freedom again.

I think you hit the nail right on the head here for why an unrestrained free market is basically an opening for an eventual corporate monopoly. Inevitably money will be amassed that will also inevitably go on to stack things in the favor of the people making the most. Unless someone has somehow proposed a solution to this eventuality, it is why I oppose the idea of a "Free market" without restrictions. Cause a "Free market" will only last as long as it takes someone to amass enough funds to start buying off politicians.

The only way I see this being headed off is by sustained vigilance from individuals. And the possibility of either some sort of citizen run commissions and boards, ala rent control boards and the like. It's possible for these things to be corrupted, but not if certain measures can be taken.

I hold up for example the Good Government Junta's of the Zapatista's. Basically every Junta is staffed by people who are randomly chosen to serve for two months at a time.Short of corrupting whole villages, theres no way anyone could corrupt the Junta's without them eventually stepping down and being replaced by a new crew. Moreover, it introduces people to the problems and tribulations of governance and managing themselves and making sure that everyone involved is not just merely a spectator voter but whose hands are involved.

These Good Government Juntas, however, are bureacrats for these indigenous communities basically. The actual decisions involve the whole community in a consensus type roundhouse. These often times take up to 3 or more days to put together and decide on issues. Obviously there are problems with consensus (and one reason why its not a perfect solution either), including group think, stalling by one or two individuals or factions, etc.

Thus far the Junta's have been operating for two years in the various autnomous municipalities of the Zapatista's, and in some places autnomous governments have been operating for far longer (some as far back as 1998).

I think the Zapatista's are the real model for other indigenous groups to follow. They revolve around people, and not leaders (the emphasis on Subcomandante Marcos was mostly a western fixation...in fact when the Zapatista marched into Mexico city some 200 K strong and spoke in Congress, ski masked and all, it was noticeable that Marcos did not speak. Instead a female Zapatista subcomandante spoke). One of the more interesting projects of an ngo is the chiapas indymedia project and promedios.org, both of which give the indigenous the power to express themselves without the help of white, northern journalists.

2:42 AM  
Blogger Sean said...

Also, I don't think there should be a "Free" commodities market. What is the point of buying coffee for a couple cents less if it means thousands of farmers in debt? Some sort of floor and ceiling mechanism must be put in place, to make sure that those whose existence rely upon agriclultural exports don't get screwed utterly. If agribusiness in America has a bad year, it has the capital to keep itself afloat. A campesino in Mexico doesn't.

I think thats whats absolutely ridiculous about most free trade policies. They seem one size fit all for developed nations that suffer from high tariffs and barriers. Asking a country on very tenuous standing as far as its exports to basically have the dogs of war let loose in it is asking for this kind of mayhem. America and other developed nations had similar policies of protection and tariffs while they were beginning but yet the consensus recently seems to be that developing countries not only don't need these protections, but must accept foreign capital and imports as fast as possible.

There will always be birthing pains with any country economically growing and changing. And state subsidies and protection can't hold out forever. But whats happening today is the equivalent of sending in a five year old to fight Mike Tyson when he was the Heavyweight Champion of the world. These countries need much more basic and rudimentary development before the international market can be allowed to run in.

3:19 AM  
Blogger Andrew T. said...

Sean - don't have time for an in-depth post right now but...

Basically I agree with you - I'm all for "restrained free markets". Which in my mind is still a free market policy.

I believe strongly in free market ideology, as a general starting point.

From there, sure, I think it's very reasonable to look at ways to "police" the free market, just as we "police" civil society.

Our free society (in the US and in Bolivia) has rules, limits, etc. that curtail my ability to take your wife because I'm bigger than you are, or do other henious things.

In other words - my belief is - u-rah-rah free markets, now let's perfect them and make them work for all of us.

As for the zapatista thing, I haven't had a chance to read over the system you describe in detail, but at first blush it sounds unrealistic at a larger scale

9:38 AM  
Anonymous Paul V said...

Your third post was excellent, Andrew T., especially the part about the hippie.

I have one question, though. Most Chinese are extremely poor, yet China is quickly becoming the world's factory. How is China able to move forward so fast while Bolivia is stuck in neutral?

10:37 AM  
Blogger Sean said...

China operates mostly because of an autocratic regime. There's no worries of Bolivia style uprisings happening or political "instability" (the Tiannenmen Square situation not withstanding). That's what makes it a safe and secure foreign investmenet. Because no one can say a damn thing.

1:59 PM  
Blogger Sean said...

Andrew- I think there is a need for a new terminology though. Free market has too many negative connotations these days. Level markets maybe?

As for the Zapatista thing, I agree, that it may not work in a city scale operation like La Paz. The Zapatista communities are basically small municipalisties numbering at most a couple thousand but often much smaller. Whats interesting to note is many Zapatista communities are fair trade coffee growers and produce other cooperative based goods for the international market.

Also the example of cooperative run factories in Aregentina will be interesting to watch.

3:30 PM  
Anonymous Paul V said...

China operates mostly because of an autocratic regime. There's no worries of Bolivia style uprisings happening or political "instability" (the Tiannenmen Square situation not withstanding). That's what makes it a safe and secure foreign investmenet. Because no one can say a damn thing.

So China is moving ahead only because it is getting significant foreign investment?

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