Peruvian economists

It’s really a shame this should be a headline in Peru’s newspaper of record, El Comercio.

“Economists: continued growth is not possible unless poverty is reduced”.

Peruvian economists

Just saying, that one is right up there with “the sky is blue” and “Bill Gates not hurting for money this week”.

But such is the dilemma that is Peru: for the suits in Lima economic growth has long been detached from quality of life for ordinary Peruvians, especially in the provinces. Take for example this chart from official INEI statistics, during a period where GDP grew at a 9% annual clip.

Peru quality of life

Chullo tip to IKN.

Now I’m not pretending to have an easy solution for the quality of life issues in Peru, but hopefully some of the suits in Lima will start to seriously look beyond the neo-liberal dogma that “what’s good for business is good for everyone”.

I’ll propose a new ideology for economists in Peru: “do what’s good for the people and economic growth will follow”.

  • Stimulate the economy in the provinces
  • Improve the infrastructure in Lima’s slums and in the provinces
  • Respect labor and environmental protections
  • Reduce bureaucracy and hold the bureaucrats accountable
  • ….

The economy in Peru is too dependent on tourism and export of base metals. While those are great sources of revenue, the suits who run Peru should look at adding technology, manufacturing and quality services, the types of employment that would raise the standard of living of the average Peruvian worker.

At the end of the day, the Peruvian economy is the total of what the average Peruvian worker contributes to it, and expects to receive from it. Not in monetary “funny printed paper” terms, but in terms of products and services. It’s a no-brainer, focus on the quality of life of ordinary Peruvians and economic growth must follow.

Why Peru is poor

or – why every Peruvian needs a Jack Russell terrier.

Why Peru is a poor country

Why Peru is a poor country

The picture is from the park in our complex. Although the soccer goal only collapsed in the past month or so, the park has been in complete disrepair for as long as I’ve been here, and most probably long before that. About a month ago, the mayor of Wanchaq put up a sign that he would build a beautiful new park in our complex, 80% financed by the city.

Great news, everyone was all excited, right?

WRONG. A bunch of people in our complex were up in arms that a nice new park would only attract drunks and teenage couples, so they complained at the municipality until the mayor dropped the idea of building a new park.

I once read in El Comercio: “Peru is a poor country because Peruvians act like poor people.” I totally agree with that. The reason our park is in disrepair has nothing to do with money and everything with attitudes. The people in our complex have cellphones and internet, they buy stuff every month from Avon and L’Ebel and so forth, but they refuse to improve the neighborhood they live in.

Our daughter won't play on this junk

Our daughter won't play on this junk

Our neighborhood in Cusco, Peru

Our neighborhood in Cusco, Peru

To any observer here it is obvious how the political and business elite in Lima is totally disconnected from the way of life in the provinces, plenty has been said about that. But I believe there is another issue in Peru:

The middle class is hiding from life.

The dilapidated park in our neighborhood is only one example. The middle class in the cities in Peru lacks initiative and organized behavior, they simply don’t act as if they are empowered to create a better tomorrow. On top of that, they complain about Indios but forget it’s people like Mama Vicky who put food on grocery store shelves. Say what you will about the current recession in the developed world, the middle class in the US is not to blame for that. The high standards of life in the US and Europe are because the middle class always felt empowered and believed they could make a better tomorrow.

I shake my head every time someone tells me they want to leave Peru because there are better opportunities in the USA. Horsebaloney. There are tons of opportunities in Peru, fantastic human and natural resources, but you have to make your own happiness. Take advantage of the opportunities instead of backing away from the challenges.

This is why every Peruvian needs a Jack Russell terrier. Our dog Roxi has boundless self confidence and energy, she will never, ever, back down. She barks at Rottweilers and Mastiffs – she might get her butt kicked, but she will never put her tail between her legs and go hide.

The Peruvian middle class needs a dose of that type attitude fast, so they will start taking on some of the challenges in Peru – or they shouldn’t be surprised in 2011 to wake up to their own copycat of Hugo Chavez or Evo Morales.