I suppose I owe a follow up to my cryptic post of yesterday. Although I’d been meaning to write about the deterioration of the Peruvian currency (PEN – Peruvian Soles) for some time, the world headline news of the ousting of President Martin Vizcarra saw me throwing up a cryptic one-liner predicting swift demise of the PEN.

First things first: we are all fine and daily life has been mostly normal this morning. But to be abundantly clear: there was a coup d’état in Peru yesterday whereby a bunch of thugs in congress effectively voted themselves into the executive branch.

All the talking heads are talking but any time you take power of your country outside of the established constitutional order, it’s a coup d’état.

Ostensibly congress impeached the sitting President, Martin Vizcarra, on corruption allegations. Legally, congress in Peru has the authority to impeach the president but legal and legitimate are 2 different things. The big rub in this case is that Martin Vizcarra was governing without vice-president due to the political turmoil of the past few years. Without any vice-president in the executive branch, the president of congress was next in line for the presidency.

In other words, congress was the judge, jury, executioner and most importantly, the direct beneficiary of impeaching Peru’s legitimate President Martin Vizcarra. The thugs in congress trumped up some charges against the President and in a few hours of open and shut debate, voted to throw out Vizcarra and take the keys to the executive office. There is no defensible argument that it was a legitimate impeachment, the Peruvian congress voted out Peru’s president because they could and because they would be the immediate and immense beneficiaries.

The details really aren’t important. What matters here is that the constitutional order in Peru is flimsy at best, and deteriorating. Peru today is not really a constitutional democracy, its system of governance is a ruling class comprised of oligarchs and thugs under the guise of a democracy.

Just because people trot out to vote every X years does not mean the country is a constitutional democracy. Unfortunately many ordinary Peruvians simply don’t have the level of education or understanding to make the distinction between a true democracy and marking a ballot every so many years.

As for the Peruvian Sol (PEN) there are many underlying issues, from populist policies across the board (printing money) to demographics (young population) to the impact of the coronavirus pandemic but all of those things are relatively not as important as the underlying constitutional order.