Latin America & Caribbean

Blogs have changed the way people put into practice concepts such as voice and freedom of expression.  In a matter of minutes, anyone who has access to a computer with internet connection can create a blog and start posting ideas, experiences, opinions, pictures and videos that will be become available to more than 1.5 billion internet users in the world.

Also, blogs' features enable two-way communication and interaction between users, very different to the "static" dynamic of traditional websites. Most important, people can do all of these things at no cost.

However, the expansion of the blogosphere has also triggered negative reactions, especially in environments where censorship and control of information still prevail. Touching on several of these reactions, the Committee to Protect Journalists (CPJ) launched a special report in which it highlights the "10 worst countries to be a blogger."

"Hello, son, are you Ok?  We just got a phone call, and someone told us that one of our sons/daughters was kidnapped. We wanted to be sure that you are fine."  You can imagine how scary was the movement that these parents went through after they picked up the phone and received the ugly and unexpected message.  As sad as it sounds, this situation is something that some families in Mexico have experienced.  Sometimes they are lucky to find out that their relatives are fine, and that everything was faked by someone looking for a profit by creating confusion among relatives.  In other unfortunate cases, the message is real and families have to go through very difficult experiences that may last several months and that not always have a good outcome.

It's not new that Mexico is having problems with violence and crime, coming either from drug-cartels or from organized mafias of kidnappers and car thieves, among others.  It's also true that the entire country is not a jungle and lawless area where nobody is safe.

Over the last decade and a half, most of the approaches to solve these issues have looked at the rule of law and law enforcement elements of the equation.  Better legislation that penalizes these criminal activities; well paid, trained, appropriately equipped and not corrupted police corps; military support to fight drug-cartels; better prison's system that functions as social rehabilitation centers and not as universities of crime... and the list goes on.  This is a good direction to follow.  However, I've always told my friends and colleagues that there are other elements in the equation that also matter a lot, namely, poverty reduction and inequality.

In my previous blog entry, I made the case that both the antecedents of the financial crisis faced by Chile in 1982, as well as the approach taken to resolve it, provide insights for countries such as the US today -suitably adapted by circumstances, size and complexity, of course.  Nonetheless, focusing on the fundamental pillars to approach the crisis comprehensively (including fiscal and monetary policies, institutional revamp, financial workouts, regulatory reforms) always ought to be a priority, rather than endless debates about whether one initiative such as a ‘bad bank’, will be the solution.  

From its more recent experience, there are further insights from Chile for the Americas. One is Chile’s consistently effective macro-economic management over the past two decades, where fiscal surpluses (a term that appears to have been excised from the US lexicon) have been the order of the day.  In fact, ‘best practice’ stabilization funds have permitted a sizeable accumulation of public funds during the ‘fat cow’ years, for judicious use during leaner times. 

Very recently we witnessed political and social unrest in Colombia due to the implosion of the DMG pyramid scheme (named after the scammer, David Murcia Guzman).  And now we got Madoff in Wall Street.  These cases today show how difficult it is sometimes to learn from the past.  Especially when past events are far way in space and time…

I have received articles from experts in Colombia who found parallels in their current case with the analysis I made long time ago on the Mavrodi’s MMM pyramid scheme collapse, which inflicted major pain on so many Russian citizens in 1994.  The focus of my old article was on the MMM Russian case.  But there were other such financial collapses caused by pyramid schemes at that time, including in Romania, and then the tragic case of Albania, in which 2,000 citizens died during the civil war that ensued.