Blog post

March 28, 2006 [LINK]

Lethal vengeance in Peru?

As the pivotal election in Peru approaches, the rhetoric is getting more heated all the time. Antauro Humala, the retired military officer and brother of presidential candidate Ollanta Humala, with whom he has plotted armed insurrections in recent years, declared that there should be a "historical lesson to the corrupt politicians and traitors," calling for President Alejandro Toledo, his wife Eliane Karp, former Economy Minister Pedro Pablo Kuczynski, and others to be executed by a rifle squad. He is currently serving time at the Piedras Gordas prison, which may explain his bitterness. See Peru.com.

(Re-)Nationalizing utilities

Monday's Washington Post has a background article that reminds me why the ironic phrase I use for Latin America -- "Land of Eternal Eternity" -- is often quite apt. Argentina and several other countries are reversing the trend of the 1990s whereby water, telephone, and electrical utilities were privatized and sold to foreign investors, usually French or Spanish conglomerates. It was a very sensible, expedient way for the government to liquidate hopelessly inefficient enterprises and allow a whole new team to come in and get things working again. Of course, that meant that many non-productive people were fired, and most people's utility bills went way up, since the government was no longer subsidizing those services. There were bitter complaints, but there was no real alternative, and gradually most residential customers enjoyed a much better level of service. I can attest to that from seeing Peru in 1994, 1996-1997, and 2004. As part of the general political trend toward nationalism and populism in recent years, however, many governments are reversing course, as if the lessons of the past about how inefficient the government was in providing utility services had been completely forgotten. It is truly tragic.