Que Pedazo!

People, the Cuban economic liberalization is really starting to bear fruit. Big news from Havana of two new men’s fragrances for the export market: Hugo and Ernesto!


As always, I am not making this up.


En una convención en La Habana, la empresa cubana Labiofam, que produce medicinas homeopáticas y productos de limpieza, ha lanzado dos nuevas aguas de colonia para hombres: ‘Hugo’, por el difunto líder de la revolución bolivariana en Venezuela, y ‘Ernesto’ en homenaje al Comandante de la revolución cubana, Ernesto Guevara.

“Estos nombres salieron de una encuesta que se realizó en una exposición donde llevamos las fragancias con vistas a que el público decidiera como podían ligarlo a nombres de personalidades internacionales” explica a BBC Mundo Mario Valdés, director del grupo de investigación y desarrollo en Labiofam que diseñó los perfumes.


OK, so it seems that Labiofam, a maker of cleaning products, has relabeled and rebottled some of their product for the export market.

And the names were picked by polling the publics’ preferences on international personalities.

Either the control of the media by the Cuban government is stunningly good, or maybe that poll wasn’t so, shall we say, open?

If Seventh Generation polled Americans, could you see them coming up with Warren Harding and Bartolomeo Vanzetti as the winners?

No word yet what the estates of Hugo Chavez, Che Guevara, or Hugo Boss plan to do about this. But I do expect that Knuckles Maduro will order a case or two.



Room for improvement

Andres Oppenheimer has a recent article on endless litigation in Latin America.  Specifically, he looks at the World Bank’s Doing Business Report for 2014, which ranks 189 countries in terms of how difficult it is to do things like enforce contracts.

The ranking shows that Latin America as a whole has some serious room for improvement.  As Oppenheimer reports, “it shows that it’s easier to enforce a contract between two domestic private businesses in Communist China or corruption-ridden Russia than in Brazil, Mexico, Colombia, Argentina and virtually any other Latin American country.”

So let’s look at some specifics:

Contract enforcement: Russia 10, China 19, Argentina 57, Chile 64, Mexico 71, Venezuela 92, Ecuador 99, Peru and Uruguay 105, Panama 127, Brazil 121, Colombia 155 and Honduras 182.  I’m curious about Russia’s ranking of 10.  Does contract enforcement include extra-legal enforcement?

# of Days it takes to Enforce a Contract: Russia 270, Mexico 400, China 460, Peru 426, Chile 480, Argentina 590, Venezuela 610, Uruguay 725, Brazil 731, Colombia 1,288, and Guatemala 1,402.  My thoughts:  (1) way to go Mexico; and (2) same question w.r.t Russia–does this include knee-capping as a means of enforcement?

Average legal fees to enforce a contract (as a % of the total value of the contract): China 11, Russia 13, Brazil 16, Argentina 20, Chile 29, Mexico 31, Peru 36, Venezuela 44, Colombia 48, and Panama 50.  The Panamanian score surprises me for some reason.  Mexico isn’t too hot on this ranking either.  I’ll shut up now about Russia.

Not surprisingly, East Asian countries are leading the way in contract enforcement.  Oppenheimer notes that:

“In Singapore and South Korea, once chaotic and corruption-ridden countries, it only takes an average of 150 and 230 days, respectively, to enforce a contract, according to the report. In the United States, it takes an average of 370 days. 

Asian countries such as Malaysia are creating groups of judges who are highly specialized in commercial litigation and can thus do their jobs faster and better.

South Korea also has sped up litigation considerably by creating e-courts, where lawsuits are filed electronically. Virtually all court procedures can be done online 24 hours a day, 7 days a week. South Korea launched its electronic case filing system in 2010, and about half of its civil cases are currently e-filed, saving a lot of time and money, Lobet said. By conducting litigation electronically, South Korea uses less paper, eliminates the need for storage space, and — most importantly — makes it easier to access documents.”

We debate how replicable the East Asian miracle is in development.  A lot of elements of the miracle are indeed hard (or impossible) to transplant, but I would think that following the East Asian lead on these kind of issues would be both do-able and advisable.

Cool education news from Mexico

I just got done covering education and the difficulty of reform in my Mexican economic development class and it was pretty depressing.  Given that, I was thrilled to read about some very cool news on the educational front in Mexico.

Wired has an article about a middle school teacher who was intrigued by the grannies in the cloud idea and decided to try to implement something similar in his class.  The result is something like a Hollywood movie.  Here’s the scene:

“José Urbina López Primary School sits next to a dump just across the US border in Mexico. The school serves residents of Matamoros, a dusty, sunbaked city of 489,000 that is a flash point in the war on drugs. There are regular shoot-outs, and it’s not uncommon for locals to find bodies scattered in the street in the morning. On most days, a rotten smell drifts through the cement-walled classrooms. Some people here call the school un lugar de castigo—“a place of punishment.”

Here’s the hero teacher of the story:

Sergio Juárez Correa started by telling them that there were kids in other parts of the world who could memorize pi to hundreds of decimal points. They could write symphonies and build robots and airplanes. Most people wouldn’t think that the students at José Urbina López could do those kinds of things. Kids just across the border in Brownsville, Texas, had laptops, high-speed Internet, and tutoring, while in Matamoros the students had intermittent electricity, few computers, limited Internet, and sometimes not enough to eat.

Here are some of the (pretty big) obstacles he faced:

A key component in Mitra’s theory [the granny in the cloud guy] was that children could learn by having access to the web, but that wasn’t easy for Juárez Correa’s students. The state paid for a technology instructor who visited each class once a week, but he didn’t have much technology to demonstrate. Instead, he had a batch of posters depicting keyboards, joysticks, and 3.5-inch floppy disks. He would hold the posters up and say things like, “This is a keyboard. You use it to type.”

As a result, Juárez Correa became a slow-motion conduit to the Internet. When the kids wanted to know why we see only one side of the moon, for example, he went home, Googled it, and brought back an explanation the next day. When they asked specific questions about eclipses and the equinox, he told them he’d figure it out and report back.

The Hollywood ending:

The previous year, 45 percent had essentially failed the math section, and 31 percent had failed Spanish. This time only 7 percent failed math and 3.5 percent failed Spanish. And while none had posted an Excellent score before, 63 percent were now in that category in math.

The language scores were very high. Even the lowest was well above the national average. Then he noticed the math scores. The top score in Juárez Correa’s class was 921. Zavala Hernandez [the principle] looked over at the top score in the state: It was 921. When he saw the next box over, the hairs on his arms stood up. Paloma received the highest math score in the country, but the other students weren’t far behind. Ten got math scores that placed them in the 99.99th percentile. Three of them placed at the same high level in Spanish.

That’s right.  Not only did the scores go through the roof after one year of the new teaching methodology, but Juárez Correa discovered that he had the smartest math student in the country in his class.

The evil administrator tries his best to denigrate Juárez Correa and his students’ achievement, makes an idiot of himself, and hopefully (but unlikely) signs his own letter of resignation with this dribble:

Francisco Sánchez Salazar, chief of the Regional Center of Educational Development in Matamoros, was even dismissive. “The teaching method makes little difference,” he says. Nor does he believe that the students’ success warrants any additional help. “Intelligence comes from necessity,” he says. “They succeed without having resources.”

Our hero remains undaunted though and I can only hope that other teachers find inspiration in his story (and that administrators like Sánchez Salazar are canned).

Scaling up is hard to do

Blogging by Boz has an interesting post about rooting out corruption in the Mexican police force.  He notes that the government had set a goal to vet all of the police in the country but so far has only vetted 75% of the force.  I’m not sure when this goal was originally set, because 75% actually seems quite high to what I would expect.  There have been inevitable delays and some unfortunate unintended consequences.  Here are a few that Boz lists:

1. “Can they define “corruption”? There is a difference between a cop who takes bribes to let drivers out of traffic tickets and a cop who takes bribes to ignore extortion by cartels. The tests have allegedly been far better at finding the former than the latter.

2. Fired police have been recruited by criminal groups. In one particularly awful example in Jalisco, a fired police officer was working as a sicario for a cartel killing other police officers less than two weeks after he was removed from duty. If firing police simply increases the ranks and skills of criminal groups in certain states, that’s not a good policy. These fired officers need an opportunity and training to obtain an honest job.

3. Continued corruption. Even after these tests have taken place, there have been incidents of police who passed the tests working for criminal groups, sometimes in the role of kidnappers. That has harmed the population’s confidence in the testing process.”

Boz concludes by making the excellent argument that vetting is (1) hard to scale effectively; and (2) something that must be done continuously and not just a one-time deal.

“While Washington waffles, I’m not waiting”

I never thought I’d be quoting California governor Jerry Brown but in some rare good news for immigration reform, he signed into law sweeping new reforms yesterday.  Here are the major reforms, set to go into force in January 2014:

1. “Immigrants in this country illegally would have to be charged with or convicted of a serious offense to be eligible for a 48-hour hold and transfer to U.S. immigration authorities for possible deportation.”

2. “Undocumented immigrants can be licensed as lawyers.”

3. “It will be a crime for employers to “induce fear” by threatening to report a person’s immigration status and allow for the suspension or revocation of employers’ business licenses if they retaliate against employees because of citizenship or immigration status.”

4. “There will be a new policy to allow people to apply for driver’s licenses regardless of immigration status.”

The article goes on to not that while many other states have enacted similar reforms, the impact of California’s actions could be especially dramatic since nearly 20% of illegal immigrants in the US are thought to reside there.

It’s nice for a change to wake up to some good news about government action.

Mexico’s biggest boom in a century?

Forbes has a breathless article on Mexico called “How Oil Reforms Could Trigger Mexico’s Biggest Economic Boom In A Century.”

It is still far from certain that EPN can get serious oil reform through the Congress, but if he does, then it’s true that Mexico’s fortunes will change for the better.  Still, I’m skeptical of the following claim:

“Not only will it be bigger than the revolution in shale drilling and fracking has been in the United States,” says Duncan Wood, director of the Mexico Institute at the Woodrow Wilson Center, “This will be the most significant change in Mexico’s economic policy in 100 years.”

What is fascinating though is EPN’s genius spin on these reforms.  President Lazaro Cardenas is still hailed as a hero for taking over Pemex in 1938. Nationalization was so popular that the day is still commemorated in a national holiday. What is less known that in 1940, Cardenas changed the laws to allow Pemex “to enter into production-sharing and profit-sharing contracts with private, Mexican-owned companies.”

It was President Ruiz Cortines in 1958 who modified the law to essentially eliminate the possibilities of such contracts.  So Peña Nieto has positioned himself as a latter day Cardenas, or at least a man intent on restoring Cardenas’ original intent with respect to oil.  Duncan Wood has a great quote where he “likens Peña Nieto’s political performance to Jesus Christ’s miracle of raising Lazarus (or Lazaro) from the dead.” As he concludes, “They know how to put on a show.” That they do.


Mural of Cardenas signing into law oil and agrarian reforms.

Are Women Less Corrupt?

NPR reports that Mexico state has turned to women to try to solve its age-old problem of traffic cop corruption.  According to Police Chief Carlos Ortega Carpinteyro, the idea is that women are “much better suited for traffic duty than men because people respect them more.”  I’m not so sure about that claim, but he goes on to explain that  “when a man is approached by a female cop, even though he is the stronger sex, he calms down and will listen to her.”

This has not always been the case in Lima, which undertook a similar program years ago to battle corruption.  According to one associated press article on the Lima experiment, “80% of the 405 incidents reported in the past two years have involved one of the capital’s 1,031 female police, meaning roughly a third of them have been cursed, shoved, punched, dragged, run over or taken hostage by angry men. Cabbies and bus drivers are the worst offenders.”  Apparently, Mexico City tried this approach and scrapped it because of problems.

So how is the new program in Mexico working so far.  Well, there has been some obstacles.  According to the same police chief, the principle “challenge is finding a woman that portrays a good image. “We get too many short and fat ones. We need tall women that render respect when out in the streets.”  Ah, Mexico, a place still untouched by political correctness.

What do others have to say?  Well, the state government won’t allow these new female traffic cops to actually issue tickets until the local units have enacted all of the anti-corruption safeguards that are supposed to be in place.  The article depressingly notes that “To date none of the agencies have done so, a state official says. The official wryly says it’s really hard for police officers to give up their old ways.”

Here is a photo of some of the new recruits with their bright orange uniforms.  The article notes that “most have matching orange eye shadow and lipstick on, too.” !!


EPN’s has big plans

President Enrique Pena Nieto, on the heels of getting his educational reform through the legislature, has ramped up his plans to overhaul the Mexican economy.  And man does he have big plans.

Here is a list of some of the biggest proposed changes.

1. The creation of the country’s first nationwide pension and unemployment insurance, financed by closing loopholes on corporate taxes.

2.  The levy of a carbon tax on fossil fuels to fight climate change.

3.  A tax on sugary soft drinks to fight Mexico’s soaring obesity rates.

4. A decision to drop the unpopular proposed sales taxes on food and medicine because the tax burden would be hardest on the poor.  However, he is planning on slowly phasing out subsidies on gasoline.

5.  Create incentives for people to move out of the informal sector.

6.  Create a rainy day fund for years when there are “excess tax revenues.”

I’m curious what long time leftist leader Andrés Manuel López Obrador  (or AMLO) has to say about these new plans.  Maybe he’ll be more amenable than he was to the proposed energy reform, which he denounced as “treason” and “a filthy, shameless robbery.” 

The kidnapping of Mexico?

The Mexican Senate passed the education reform bill today and Mexican teachers are not happy.

One senator, Mario Delgado, supports the protests, arguing that “when Congress is rendered void, the only thing that remains is the streets.”  I’m not sure why Congress is void just because it passes a reform bill that you don’t like, but whatever Mario.  I’m guessing logic isn’t your strong suit.

The bill itself is riddled with concessions that threaten to dilute the strength of the reform, but I’ll write more on that later.  For now I’ll leave you with this great image of the striking teachers denouncing “the kidnapping of Mexico.” Wow.


Televisa & the PRI

It looks like these two old bedfellows are still close.  In an embarrassingly heavy-handed attempt to sell the government’s new economic reforms, dialogue like this has made it into a recent popular telenovela (apologies to non-Spanish speakers):

The novela in question is called Corazon Indomable and it airs every weekday on Univision.  I am actually in favor of this type of reform, but this mixing of government and “entertainment” is both clumsy and cringe-worthy.  Is anyone actually convinced by this stilted (and presumably out of place) dialogue?