Saturday, March 31, 2007

Crime in Guatemala

Crime is rampant in Guatemala. Vehicle robberies are so common that we couldn’t even get theft insurance. Murders and assaults are also through the roof. While Guatemala is a wonderful place to visit, we must never forget to pay attention to our security. One of our friends lost a car a few years ago in broad daylight outside a coffee shop that had an armed guard.

I went to a mechanic today to install a shutoff switch for the car. Many people in Guatemala do this to make their cars more theft resistant. In my case I tapped into the line running to the fuel pump. When the switch is off, the fuel pump is disabled, which means the motor will turn over but not catch. The switch is hidden in the cab.

I told the mechanic about some of the work we were doing with GlobalGiving. His reaction was interesting.

“There is a lot of poverty in Guatemala,” he said, “but Guatemala is not a poor country. We have tremendous natural resources. Our problem is bad government. If we do not improve our government then there is nothing we can do to permanently solve our problems.”

It is an interesting point. We have seen time and time again how countries that liberalize their economies and establish a good legal system prosper. South Korea, for example, lifted itself out of poverty in a generation. Is there any reason why Guatemala could not do the same?


Chuck McKinnon said...

Hernando De Soto wrote a great book about this: The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else.

De Soto's central idea is that in the industrialized West, physical assets live a "parallel life" in the legal system, where they can become a form of economic leverage -- e.g. the most common form of new venture funding in the U.S. is apparently a mortgage against the entrepreneur's home. The process is so well-entrenched that we don't even think about it any more. But the lack of such a system in many developing countries prohibits their citizens from unlocking the significant "potential energy" of assets that many of them own de facto but not de jure.

There are other factors -- corruption as you mentioned, and insuperable bureaucratic obstacles (registering a new business in Peru at the time of the book's writing took over a year and cost the equivalent of 31 months' pay at minimum wage) -- and the book examines them in some detail. It's one of the most enlightening books I've ever read.

Shane said...

There is fair points that the government's corruption has definitely caused a great deal of hardship with the people in these countries.

I do think it's really important to look at what we feel is a good life for these people too. Is that the American Way that everyone should live? Cause I think that the American way is failing a lot of people and we can thank a lot of liberalism for all that too. For example, the exports of materials from one country (whether you are dealing with corruption or not) and then sold in another country at a higher price is pretty ridiculous.

Most of these people just want to live a good life, be able to eat, and enjoy the community they have established. Well at least that's what it was like in Ecuador when I spoke with locals and lived with them. And really they probably would do much better given we were actually giving them a fair wage for all the materials that they are selling to the rich North Americans.

I don't mean to sound all anti-capitalist in nature but I do think that we need to look at the bigger picture here (read: there is more to countries, development, and survival then supporting systems of trade and entrepreneur economies). Frankly, the Ecuadorians that I met had way more than some communities in Calgary with regards to culture, sharing, caring, and support. They would lend everything they had (including physical labour), share all their food, and care for one another. Something I definitely lost and didn't see in communities like McKenzie Towne in Calgary.

So yes making these communities sustainable, a non-corrupt government, fair wages, etc. is something that I support. Let's just be careful not to actually say that creating a capitalist government is the solution to everyone's woes.