CADE Innovations: Stay tuned for ‘El Nuevo Peru de Antes!’

By Nicholas Asheshov

~ Special to Peruvian Times ~

As business leaders meet in Cusco this weekend to focus on “Innovation” at the Annual Executive Conference, CADE, from the countryside of the Urubamba valley the author proposes looking back for truly radical and practical, high-tech innovation.

Ancient Peru was one of the half-dozen centers of the technological and political innovation that ushered in today’s complex world of great, interdependent cultures.

Unlike the other centers — China, the Fertile Crescent and Egypt, India, and finally the Mediterranean and Western Europe — most of Peru’s innovations, above all in social organization, were lost in the disaster of the Conquest.

Proud, sad bits and pieces of the ancient Andean and coastal cultures remain.  The potato and a half-dozen varieties of maize have been essential parts of the food chain that is feeding 7,000 million people.  China is today the world’s biggest producer of the potato, first domesticated around Lake Titicaca, and of the sweet potato, camote.

Peruvians can reflect, perhaps with mixed feelings, that it was the US$200,000,000,000, at today’s values —the figure comes from Prof. Niall Ferguson’s Civilization: The West and The Rest, published in London earlier this year— that the conquistadors sent back to Europe between 1532 and 1780, which provided the liquidity for the creation of the global economy of the 21st century.

But the precious metals, like the guano, tomato, quinoa, cherimoya and cocaine, are secondary and are in any case not really what we mean by innovation.  The khipu, the cutting-edge strings-and-knots combination of iPad and Registros Publicos — production cost 35 cents— was lost, destroyed maliciously by the priests, the Taliban of the day.  Only 620 remain. According to Prof. Gary Urton, of Harvard, it was much more sophisticated than anything in Europe at the time but they still haven’t cracked its complex code.

Like Machu Picchu, the thousands of miles of all-weather roads, irrigation systems on the coast, tens of thousands of stone terraces and water systems in the valleys and highlands, and the networks of warehouses, these were by-products of the real value of life in Ancient Peru.  This was the lively, aggressive social and political stability that allowed the Incas and a dozen great cultures that preceded them — Chavin, Moche, Tiahuanacu, Huari — to produce societies that were in the front rank of their contemporaries worldwide.

On Lake Titicaca, in the Sacred Valley, and in 50 other valleys like the Colca and the Rimac, the stability and genius for working together of the ancient Peruvians literally remodeled one of the world’s toughest environments.  They consistently created an idealized, civilized world of good order and stability.

No one can look at the massive millimeter-fine, delicately imaginative granite blocks at Sacsayhuaman, Pisac, Rac’chi, Huanuco Viejo, Rosaspata, Sillustani and, naturally, Machu Picchu itself without understanding instantly that for two or three thousand years ancient Peruvians created a purposeful permanence.

The same applies, with obvious local variations, to the great adobe pyramids on the coast.  Perhaps in the same way that today’s costeños are more outgoing than the peoples of the highlands, the costeños produced the flamboyant artistry of the gold- and silver-working of Sipan.

These were productive, often competitive societies whose vision was not just day-to-day or year-to-year, but in some clear way, eternal.  You and your children do not spend a lifetime producing a granite masterpiece just to fill in the time between meals.

Peruvian schoolchildren are not taught about the power and range of their ancestors.

The Incas — schoolchildren in Urubamba, Huancane, Bambamarca and Ayabaca are taught today — were ‘indigenas’.   There is a puzzling political agenda here.  The teachers do not know, do not seem to want to know, about Peru’s long distinguished past.

So my proposal for a first innovation that Peru today might want to consider is to produce DVD and computer programs that will be in every school in the land, every classroom in the country, which will tell the real story of the pre-Conquista past.  They will learn, for instance, of the complex, innovative technology that went into the layered construction of the terraces and hydrological systems they see around them.  They will learn about the networks of warehouses and storage facilities.  When the Spaniards arrived, they found that there was two or three years of food and clothing stored everywhere.

The project includes the creation of computer games called “Build An Andean Empire” and “Run Your Own Coastal Civilization” and, of course, war games like “Incas vs Spaniards.”

Secondary-level kids will move on to “How to Run a Municipality/Region/Country.”

And so on.

The interactive computer programs and movies, modeled perhaps on the science and history programs produced for the NGS, the Discovery Channel, the History Channel and the BBC, will be financed and distributed by the banks and commercial and industrial companies, all of them members of CADE, which will also be in charge of distributing them.  Teachers, including members of SUTEP, will be instructed on teaching the children how to switch them on and off.

Within a few years young Peruvian voters will have a new vision of their country and its possibilities.  Unlike most other countries, including some of the neighbors, they have a history, not to mention a geography, which they can see and touch, second to none.

Population: from 1mn to 3mn to 30mn — and now on to 40mn

It is hard to blame today’s governments for not telling the young about the first-class public administrations of Peru half a millennium ago.

The most crushing blow of the Conquest was in the loss of people.  Between smallpox and piratical savagery, nine out of every 10 Peruvians died between 1530 and 1601 when a census registered only one million people, most of them in the highlands.  The coastal peoples had been exterminated.

These population losses were calculated by Noble David Cook in Demographic Collapse: Indian Peru 1520-1620 and Born to Die; Disease and New World Conquest published by the Cambridge University Press.

Peru’s population was to rise painfully slowly to three million by 1911.  All the Peruvians of a century ago would all fit easily into Lima’s Cono Norte today.   As everyone knows, today Peru’s population is 30mn, 10 times greater, in less than four generations.

Inca Peru had 10 million inhabitants, according to Prof. Cook’s best guess.   All of them lived out in what is today the countryside.  Cuzco had perhaps 40,000 inhabitants, less than Huacho today.

The next innovation will be to prepare for a Peru that within another generation will have 40 million people.  Peruvians will be much younger in a decade or two than the Chinese and other Asian tigers and, of course, the already-geriatric Europeans.

The local politicians in Cajamarca, Puno and elsewhere today who are protesting against gold and copper mines are being unusually far-sighted.   They are trying to keep the gold, silver and copper out of the hands both of international bankers and of Lima bureaucrats.  “Water for us, not gold for them,” they shout, and of course we all agree.   The government should instead borrow from the bankers and, noblesse oblige, repay them in worthless paper in 2041 et seq.

A decade or two from now the minerals will be worth ten times their present value and a generation of history-savvy, computer-literate Peruvians will be able to take full advantage of their elders’ foresight.

______________________

This article was published in Caretas magazine this week in Spanish.

Nick Asheshov is a director of The Machu Picchu Train Co., Urubamba. A veteran journalist, noted explorer and entrepreneur, he was editor of the Peruvian Times from 1969 to 1990.

Op-Ed: Observations on the Election Results

“The coming years will for sure compound this as the voting tsunami lines the pockets of a few, but salts the wells of families all over Peru.”

 

By Nicholas Asheshov

Here are some immediate technical observations on the knife-edge victory of Ollanta Humala.

• Keiko Fujimori’s people fatally misjudged the final two or three weeks of an inordinately long campaign. The polls show well enough that if the election had been in mid-May, Keiko would have been first past the post. Keiko’s kitchen cabinet, led by Jaime Yoshiyama, a first-class minister in her fathers first administration (1990-92), were so self-confident that they refused to broaden out and form a coalition. They thought they could go it alone.As President Garcia told associates: “They’re close, much too close,” — son muy cerrados. Read more…

What should Peru do?

This article by Paul Goulder looks at the 2011 Peru presidential election from the point of view of economics and history, and first from the economic experience of Peru from 1960 to 2007.   —

Peru has spent forty-five of the last fifty years bumping along the bottom of a GNP (gross national product) chart:

Only in recent years has there been something like lift-off. This article argues that Peru has a once-in-a-decade[1] chance of catching up with not only the other two economies on the Chart in section 1 (Chile and Korea) but even the “really high income” countries in the subsequent table (e.g. Norway). It can do this by investing selectively but massively in education and in high-end investment-good demand.

At the close of the opinion polling this week it seemed that there was a slight movement towards Humala and his now companion-in-arms, ex-President Toledo. This is good news for those who want Peru to rub shoulders with the really high income countries through the high-trust development route outlined in this article, as Toledo particularly has the required experience and knowledge to follow this through and a belief in the free society necessary for the nurture of creative enterprise and a can-do attitude[2] to new projects.

The electoral process so far[3] has been characterized by indications of negative voting, which is a tendency of a second round system. In a sense, a state of “electoral fear” hangs over Peru: fear of the supposed intentions of the other candidate and an ultimate flickering fear of a descent into chaos, of renewed terrorism, corruption, state killings and of Mexican levels of drug-related assassinations.

In spite of recent gains, the economy is way behind others  (see Jaws I and II below) with which it was level-pegging until the early seventies.  But the recent miracle growth rates permit thoughts of playing catch-up with the really high-income nations – and why not? We suggest that the magic something that has gone right for Peru - the “something” that we recognize as successful and which the electorate wants to keep – has not been well identified by the political process. It has been over-simplified by political campaigners but the devil is in the detail and neither campaign likes specifics overmuch.

1.JAWS I and II - THE INCOME AND DEVELOPMENT GAP

 The Peruvian economic story from 1960 until the more recent  boom (in Peru) and crisis (US and Europe).

Since 2006/7 the situation has improved as Peru has notched up an average 7 to 8 percent growth rate in real terms: 3,276 to 4,469 (but compared to 68,360 to 84,640 for Norway) current dollars per person for years 2006-9. There is still a very long way to go.

2. VISIONS – TURNING A TEMPORARY BOOM INTO A PERMANENT FEATURE

The second round electoral system – as we have seen over the last few weeks – tends to encourage an intense period of character assassinations. The winner in the opinion polls will simply be the candidate who commands the support of the most newspaper and TV channels, or the media in general. As most of these are in commercial hands, their support will tend to go to a pro-business candidate – unless they can be otherwise “bought.” So the “fear of the other candidate’s intentions” has driven the election debate into a “she is a greater threat to democracy” and “he is a greater threat to the economy” corner. 

This is a pity because the economic gains of the last few years provide the necessary – but not sufficient – conditions for the emergence of a visionary leader who can turn a temporary boom into a permanent feature.  The debate should have generated an intense critique of each candidate’s vision for Peru. This in turn will have a “societal effect” as Peru converts into a country with a national mission that is more than a slogan: “building a high trust society,” “conserving the environment,” “water for all,” “defeating rascism.” Referring to Peru´s first major boom – that of guano (1840 to 1879) – the country’s great mid-twentieth century historian, Jorge Basadre, warned of what he called the “prosperidad falaz.” We have been warned.

3. FANTASIA WITHOUT MUSIC – PERU IN 2025
Imagine the following (more surrealism than fiction) written, say, fourteen years into the future.

“During the last few years The Peruvian Model (the PM) has become known world-wide as a beacon of hope for the globe. The PM has earned its international acclaim in (a) its model education system – turned round in a decade or so – with 87 percent of all schools raised to the level of the ten best in the country, (b) a final rejection of racism – and inter-racial strife – with a whole raft of policies delivering equal opportunities to all Peruvians, (c) an ecologically balanced economy based on land property rights and stakeholder shares in resource-concession companies paralleled by a land-value tax,  (d) a business driven social model where corporations are given the right incentives to promote responsible community projects and (e) the use of mobile (replacement) executive boards to be parachuted into inefficient or unworthy companies. And it has worked. A series of world-wide ecological disasters following the Japanese Tsunami of 2011 had brought the world to the edge of self-inflicted disaster. This intensified the search by global institutions for an economic model that really addressed the issues. They found the new Peruvian Model already in place which put Peru ahead of Switzerland and Sweden on a number of criteria (but not yet, of course, in terms of Net National Income per head), and it is shortly to be adopted – by consent – by almost all the countries of the European Union and the US, China and Russia are to follow. The year is 2025.

And yet the PM almost didn’t happen – no, not even in Peru. In the election of 2011 there had been a bizarre vote-counting fraud.  Ex-President Toledo, Vargas Llosa and Humala had led the campaign for a re-run, whilst Fujimori’s daughter had disowned both her party and her father and set up a new political campaign taking 75% of her Congress representatives with her. The at-one-time unlikely trio had formed a national coalition emergency government bringing in the new much-vaunted education policy and the other features of the (new) Peruvian Model.”

 Fact or fiction? We will know in a few days!

4. WHY THE PERUVIAN MODEL (PM) IS MORE THAN ECONOMICS
The existing Economic Model (EM) has been declared sacred. The Cardinal-Archbishop says so. It’s been beatified and is well on its way to sainthood.

Though it’s not a “model.” It has some elements of the neo-liberal and monetarist but not all. There are still many blocks to competition.

Often what politicians are referring to is not much more than a “feel-good factor for some sectors,” driven by exceptional growth rates. The Euro-American (US) world is in economic crisis but Peru’s economy has averaged 8 percent growth over five years. These high rates are put down to temporary features – such as a boom in raw material prices, a massive inflow of foreign capital, a low dollar – and also to more fundamental changes such as forming stronger links to China, implying a shift from US dependency.

The PM is a much more “complex and sensitive modeling” that includes multiple creative corners of Peruvian society – which surface from time to time in the Peruvian Times. Let’s attempt to list the major changes (to explanatory factors in the model) over the last few decades.

5. THE MANY CONTRIBUTORS TO THE SUCCESS OF THE PAST SEVERAL YEARS
The more permanent changes – and therefore the more reliable in the long run – include more women professionals in the economy; more people from the Peruvian heartlands (andinos and others) in professional and executive jobs; a crackdown on corruption[4] and immunity (Paniagua and Toledo administrations); a welcoming attitude to information technologies; some dividend from the expansion of Conafu-universities; a “delayed” but improved public infrastructure; a breakthrough into international markets; low import taxes; more Peruvians abroad (returning reskilled / sending remittances); more irrigated land; a “diversification of spiritual / religious life” (secularization, growth of new religions); some inroads into the “low trust” society[5]; a renaissance of cultural life; some intercultural education; ecologism; some success in titling (titulation of invaded land etc); very dynamic marginal informal sectors with a more robust process of formalization; balancing the national budget (= low inflation); some progress with “continuity” – public servants who finish or are allowed to finish the job; and the list – not written in any particular order – continues.

6. THE MAGIC SOMETHING THAT HAS GONE RIGHT FOR PERU

In brief, the PM is much more than the economic model. It has multiple sectors, a variety of actors and is intensely “Peruvian.” It is the “something” that we recognize as successful and which the electorate wants to keep. But it has not been well identified by the political process – partly because of the nature of the second round system. Many of the leaders, innovators and creative entrepreneurs who have been responsible for the model and its success have rallied recently to the Humala banner – some because they fear that the authoritarian government plus under-regulated markets of the Fujimori formula will stunt the creativity of the “real Peru,” as would restrictions on the associated democratic model (a clampdown on democratic freedoms).

In short, the aim of this article is to disentangle the “Economic Model” (EM) from the actual “Peruvian Model” (PM[6] – the real Peru). The EM has become sacred scripture for political debate: “I swear I will abide by the ten commandments of the Economic Model.” The EM is the market plus monetarism while the Peruvian model, or formula, is a far richer being and describes (or attempts to describe – because it is a massive task) what has been happening in Peru.

7. CHINA AND PERU

China[7] has taken enormous strides in building human capital. The adult literacy rate is now almost 95 per cent, and secondary school enrolment rates are up to 80 per cent. Shanghai’s 15-year-old students were recently ranked first globally in mathematics and reading as per the standardized PISA metric. Chinese universities now graduate more than 1.5 million engineers and scientists annually. The country is well on its way to a knowledge-based economy.

Peru has had good literacy and secondary school rates for some time but has significantly failed to give emphasis to mathematics, engineering and science and has been almost entirely negligent about teaching Reading & Writing in the students’ parental language.

8. INTERNATIONAL VIEWPOINT

The eyes of the world are on Peru at this time of a critical election. The “BBC de Londres” views the election as  a choice between “wallets and consciences.” It adds that “Keiko Fujimori’s last name, for many Peruvians, is synonymous with the destruction of democratic institutions, systemic corruption and a murderous counter-insurgency against Maoist Shining Path guerrillas in the 1990s.

Voting with your conscience would mean voting for Ollanta Humala, a former army officer who calls himself a nationalist. An essay on democracy, economy, history and the election.” However although this view is qualified in the text, emphasizing the “wallets and consciences” aspect is not representative of this election.

9. EL LIDERAZGO DEL PAIS, con algunas excepciones, no ha apreciado el recurso más precioso del Perú: su gente

Why should this be written in (bad) Spanish? Well, I was chatting to this bloke in 1974. We were having tea together in his garden, over the road from the “Golf” in San Isidro and this is how the quote is remembered: “ la razón – tal vez la razón principal – que la tasa del desarrollo del Peru en el pasado no ha sido ‘satisfecha’ es que el liderazgo del país, con algunas excepciones, no ha apreciado el recurso más precioso del Perú, su gente…Y..su gente merece la mejor educación.”  (The reason – perhaps the main reason – why Peru’s development rate in the past has not been ‘satisfied’ is that the country’s leadership, with some exceptions, has not appreciated Peru’s most precious resource: its people…. And… its people deserve the best education.”

And for that, a priority must be given to educational reform. The bloke was an ex-President of Peru who had been toppled by a coup.

10. WHY THE ELECTORAL SYSTEM IS “UNFAIR” AND DOES NOT APPROXIMATE TO DEMOCRACY

The electoral system says that Peruvians have to vote but at the same time the “segunda vuelta” system deprives them of the candidates that they might prefer.

The long interval between the first and second rounds allows the media, if they so choose, time to character-assassinate a presidential candidate.

As my grandson would say, “It’s not fair.” So let’s have a (somewhat lighthearted) look at a couple or so of the other quirky aspects of Peruvian political history.

11. THERE ARE STILL SOME THINGS TO BE LEARNED FROM HISTORY: the worse the record, it seems the more likely the president will be voted back

Definition: There is a type of Peruvian president who performs – or whose term of office ends – so disastrously that the electorate clamor for his or his party’s return some years later. This defies normal logic and is, que se sepa, a feature unique to the Peruvian electoral process. It could be explained as late colonial psychosis, electorate amnesia and the psephology of the segunda vuelta.

Exhibit A: García (1985-90) who led – or perhaps fed – his nation to the dogs: he was voted back in 2006.

Exhibit B: Fujimori who oversaw massacres of the innocent and the biggest corruption scandal in the Americas, ever, and then ran away to Japan, was impeached, extradited and imprisoned for 25 years: his party is currently on track for winning 2011, even though he himself is in prison.

12. THE BLUNDY: the more decent the president, the more likely to be toppled.

There have been quite a few Peruvian presidents whose term of office ended prematurely  – sometimes through no fault of their own – because of a coup d’état, putsch or assassination. A sub-category of this type could be called the Blundy, who is a Peruvian president of any name who is a good democrat, fair and even-handed and thinks of his country before he thinks of his pocket. Their policies are blocked – usually by APRA – and they themselves are then toppled by a military coup or putsch as being too “weak for the job.” Blundies, it might be said, blunder into well-meaning deep water.

Exhibit C: Bustamante y Rivero was seen as a great talent, a “good democratic chap,” a constitutionalist (and/but an Arequipeño) who was blocked by APRA and then ousted by a military coup d’état. 

Exhibit D: Belaunde – a “blundy” (gringo pronunciation of belaunde) is named after this president. He was another decent chap whose policies, had they been enacted, might have proved the salvation of his country. But they were blocked by APRA (again?) and in the ensuing crisis . . . (hold on – we’re coming to the point) . . .

“Belaunde was ousted by a military coup and the armed forces under Gen. Velasco governed for (a number of) years. Then agrarian reform miscarried disastrously, they took over channels of communication – press, TV, radio, (and they) discouraged foreign investment at every turn. Gen. Morales Bermudez of the moderate army faction engineered the displacement of Velasco & eventually, opened the way to free elections, when Belaunde made a triumphal (but over-confident) come-back. The Apra party under Alan Garcia, was voted in (in 1985) and just about ruined the economy, leaving large debts and almost complete rupture with foreign sources of funding. When Fujimori was voted in I don’t think he fully realized the state of the exchequer. Then came the fam(ous) “Fuji-shock” which caused much hardship but eventually stabilized the economy. Fuji also combated the then rampant terrorism that cost (thousands) of lives on all sides, drove people away from their homelands & brought destruction to the very streets of Lima. Extreme poverty especially in the hinterland was undoubtedly a root cause of terrorism. And there was much violent repression – it was a war.”

The passage above is quoted from Peggy Massey who was a long-serving journalist with the Peruvian Times, the now-defunct La Prensa and also other publications. She composed this as a handwritten addenda to Pike, F. “A History of Modern Peru.” Peggy wrote, I think, in the spirit that Pike had finished his book just before the Velasco military coup and arguably before one of the turning points in Peruvian history. Future readers of her copy deserved a sequel!  Peggy Massey is better known for her bilingual series Good Morning, Buenos Días in La Prensa 1969-1980.

13.PERU AND KOREA’S ECONOMIES UNDER THE LENS

Returning to the graph above to compare Peru’s performance with that of Chile and, particularly, one of the Asian Tigers: South Korea.

In 1960 South Korea was just five years out of probably the most traumatic period of its history. The country had endured thirty-five years of colonization (by Japan 1910-1945) and then became during the next decade an ideological battleground for the US, the UK & other Allies on the one hand and China & Russia. And a playground for their tanks, bombers and warships. The country had been flattened – hardly a building or factory left standing.

In a nutshell: Starting from virtually zero around 1955, Korea overtook both Chile and Peru in 1973.

Between 1960 and 1982 Chile and Peru had roughly similar output per head (Chile: blue balls. Peru: faint yellow balls or black line), averaging approx US$ 2K (2,000).

In 1982 the international sovereign debt crisis hits both Chile and Peru and Sendero Luminoso starts up operations in earnest, driving out foreign capital and reducing everyday economic life to a shambles and the center of Lima to an apocalyptic state.

Until 1982 Peru had just about level-pegged with Chile but after that the wider effects of Sendero (see chart from 1982) were made even wider by the “Garcia Gulf” (see 1987). From that date the gap with Chile and also Korea really opens up as Sendero and the García “policies” bite harder. In 2000 the unlikely twosome of Jorge Chavez in the Central Bank and Carlos Boloña in the Treasury steered Fujimori and the Peruvian economy into orthodoxy, towards a balanced budget and controlled inflation. However the peace dividend heralded by the capture of Sendero boss Guzmán and the growing economy was squandered in the Montesinos corruption scandals. To cut a long story short, by 2007 Korea had twice the per capita output of Chile, which in turn had twice the output of Peru – per person.

The Korean performance had been almost consistently positive as Peru’s had been negative. Even the South-East Asia Financial Crisis (see chart 1997) had hardly deflected Korea from its upward growth track. How had Korea achieved this?

Korea was armed with its weapons of mass construction: a superb “double” education system; high levels of inter-personal respect and trust; team-playing family-entrepreneurial technologically-creative enterprises; massive injections of US capital and troop expenditure; we-can-build-it-better-than-you mentality (One French TGV train was bought stripped down and several scores of lighter, faster Korean versions reconstructed); a brand new infrastructure (the demobbed army was sucked up into a massive reconstruction machine that went on later to rebuild more than its fair share of the growing globalized economy); a prime location (the vectors between Beijing &Tokyo and that between Shanghai & Vladivostok cross at Seoul); a spiritual life based around urban, engagé, reformed Christianity (after their double dose of education from 8am to 8pm, Korean scholars pop into their local church for a game of ping-pong) and rural Buddhism (week-end excursions can be to a family shrine); a common enemy (Japan, somewhat replaced by North Korea); colonial masters who had been on the technological ascendency (Spain left a technologically-backward economy and an unreformed anti-science Catholicism in Peru and Chile);  99.9% honest and punctual (at least outside government!).

Well, it´s getting late so we had better stop this ever so slightly over-egged Korean eulogy. And the lesson[8] from all this?

Avoid civil war and the “resurgence of insurgency” at all costs! Create a fairer society.

Boycott

And oh! If you are thinking of boycotting the election, you will not only incur a fine – if you are under 70 – in Peru but also be accused of reusing another of these “blundy” words. Boycott* is defined as follows: “To abstain from or act together in abstaining from using, buying, or dealing with – as an expression of protest or disfavor or as a means of coercion.” It is derived from the name[9] of Charles C. Boycott.

14. CONCLUSION: go for a high-trust, knowledge-based economy

This article argues that Peru has a once in a decade chance of catching up with not only the other two economies on the Chart above (Chile and Korea) but even the “really high income” countries in the subsequent table (e.g. Norway).

It can do this by investing selectively but massively in education. It should cut taxes to any families and organizations who support learners of any age through individual sponsorship schemes. Schools will attract the most able students irrespective of class, creed or ethnic background. The government should further cut taxes to encourage companies to locate not only their extractive and agricultural activities but also their “knowledge-based” operations such as R&D. Mining companies, for example, would then effectively be paying the school and university fees of local children rather than pouring funds into the black hole of Lima, or worse, lining the pockets of government ministers.

A high-trust economy should be encouraged by ditching the mestizo-first policies in favor of multiple heritage social policies (no ethnic background privileged). A second line of defense would give special help to the less able students.  In higher education, external examiners of master’s courses would be given greater powers and independence. All teachers would be offered further training.

______________________________________
http://www.zotero.org/groups/perustudies/items/collection/R3PWH9BI

OP-ED: Why Humala?

By Eleanor Griffis,
Peruvian Times Publisher ~

Two weeks ago, presidential candidate Ollanta Humala took an oath to abide by a list of 12 conditions that would ensure the defense of democracy and rule of law if he is elected president.

The event was significant but it didn’t get much press coverage, other than that it was “yet another plan.”  Hardly surprising, given that the major press groups are openly rooting for Keiko Fujimori.

But the event was important not only because Humala was willing to publicly adjust his program to more centrist demands and points of view, but because the witnesses to this oath were among the cream of Peru’s intellectual community.

He already had the public support of Nobel writer Mario Vargas Llosa, who introduced the event via teleconference from Madrid, and of close to one hundred leading archaeologists, anthropologists, physicians, economists, former cabinet ministers, artists, and even the country’s leading nuclear physicist (people who industry captain José Chlimper, on Fujimori’s team, referred to as “losers”).

Now, standing in the colonial lecture hall of San Marcos University, Humala gathered even more like-minded leaders as witnesses to demand that he live up to his promise – including film director Lucho Llosa, Accion Popular party president Javier Alva-Orlandini, Peruvian Environmental Law Society director Jorge Caillaux, and psychiatrists of the stature of Saul Peña, Mariano Querol and Cesar Rodriguez-Rabanal. Not to mention Alvaro Vargas Llosa, son of Mario and an outspoken critic of the mindset of most of left-wing Latin America.

This was no rabble of dispossessed malcontents.  These are people who are internationally recognized specialists in their field, many of whom have a deeper understanding than most of us of what Peru is really all about, and who are willing to think outside the box.  With the exception of politician Alva Orlandini and activists such as sculptor Victor Delfin, they are also people who rarely voice their support publicly for any one or other politician.

A few days after this historic oath-taking, the Fujimori campaign did something similar – they surrounded Keiko in an evening fest with some of Peru’s leading surfers, football players, rap singers and dancers.   People who are valid and great fun, but I doubt many of us would seek their advice when it comes to making national decisions.

The driving premise behind the support to Humala is what novelist Alonso Cueto calls “the moral essence.”

Because there may be valid concerns about where Humala is coming from, but there is an absolute certainty as to where Keiko Fujimori will lead us.

To believe that Fujimori will govern us differently to the way her father did is to be very naïve.  I have no doubt she is well intentioned, she is young and saw what damage corruption causes, but watching her in the debate against Ollanta Humala on Sunday made it obvious that she will be no match to the machinery that surrounds her.  Her government team and most of her members of Congress are die-hard Fujimoristas who served in her father’s government and adamantly continue to defend him and his policies, openly threatening the judges who convicted him of human rights abuses and corruption.

And despite her denials of a continuation of the 1990-2000 Fujimori regime, the propaganda throughout the highlands shows Alberto Fujimori standing behind her. Not to mention that the campaign center is just a short walk from ex-President Fujimori’s prison cell, which can quite fairly lead us to believe that the campaign is being run from his quarters.

President Fujimori’s regime is rightfully credited with ushering us into the 21^st century (highways, mobile phones, online documentary processes) and of quelling terrorism (although Sendero Luminoso leader Abimael Guzman was caught by a tight investigative police team that suffered budget cuts under Fujimori and had to find funding from USAID).

But his government is also rightfully accused of stealing more than $6 billion, working the drug trafficking and money laundering network to its advantage, and of “black ops” that included phone tapping, blackmail, threats and murder.

Yet it is the insidious corruption on other levels that caused the greater damage. It was a bread and circus policy: Hand out the food and keep them entertained, and they won’t notice what we’re doing in the back.

Buying the editorial line of almost all the cash-strapped TV stations and the tabloid press meant not only a daily barrage of headlines conjuring up fear or bashing someone in the opposition, it also led to a dumbing down that Peru had never seen before and from which we still have not recovered (the comedians are still there and the journalists have come strutting back): once fairly good stand-up comedians became vulgar propagandists who mercilessly mocked and maligned anyone in the opposition, reality and gossip shows were created to lower and numb people’s decency threshold, and TV news shows became vehicles to lie outright, mock, malign and bash anyone and everyone who would not submit to the Fujimori-Montesinos plan.

Reputations were ruined by absolute fabrications, key civil servants who refused to do the government’s bidding were blocked from finding even private sector jobs and had to emigrate. Judges were fired and replaced by temporarily-appointed judges, subservient to the hand that fed them. Members of congress jumped the aisle for pieces of silver. Non-governmental and human rights organizations became four-letter words. And when the government began to fall apart in the reelection of 2000, the Fujimori-Montesinos machine was willing to kill six watchmen in the Banco de la Nacion arson fire in order to place the blame on firebrand Alejandro Toledo.

Even, or maybe especially, leaders in the business community were held prey, either blackmailed or pressured with personal or corporate indiscretions to endorse a government policy or position.  They gave credence to the business world beyond our borders.

Shortly after Fujimori fled to Japan, an Organization of American States team was working closely with the transitional government to pick up the pieces and part of this new government was a rotating multi-sector board, including business leaders, assigned to clean up and design new guidelines essential for moving forward.

It was during this time that a guest speaker at a business luncheon had to leave early to take his turn at this rotating board later that day. A key figure in the mining industry, he apologized to his peers for leaving early, adding with a shrug of his shoulders and a deprecating smirk “for whatever good it will do.”  Cynicism, or toeing the line?

When a leaked video of a junior congressman receiving money from Montesinos blew the ten-year regime out of the water, the acceptance of corruption was so pervasive that a survey in state high-schools shortly afterward showed that an overwhelming majority of pupils said they would accept the bribe, because if they didn’t “someone else would.”

To quote Alberto Fujimori, there was a generalized attitude of “hey, I wasn’t born yesterday” (no soy ningún caído del palto) and “tough luck” (yuca).

None of Keiko Fujimori’s team who worked in her father’s government seem to have any regrets for the way things were done, and they are determined to set Alberto Fujimori free (See Gustavo Gorriti’s Wikileaks story on the 2006 Alberto Fujimori and the Replacement Candidacy).

Fujimori has promised she will not pardon her father – legally impossible for human rights crimes — but there are other ways to seek his release, such as a Constitutional Court ruling to annul the sentence on the argument that the criminal court judges were partial (something of this is in the works, but it has created accusations of pressure and corruption within the Constitutional Court itself), or of finding some contrived “authentic meaning” to some procedure, an argument that Fujimori used for his re-reelection in 2000.

The next question is, then, if Alberto Fujimori is released or given house-arrest status, how long will it be before his jailed military and police generals and cabinet ministers demand their release too.  The fact that President Fujimori’s first finance minister, Juan Carlos Hurtado Miller, has come out of hiding after 10 years must mean something other than he’s just tired of the same four walls.

And Montesinos?  Will he remain placidly in his cell, when he can probably still pull many of the strings of power, if he doesn’t continue to do so anyway?

The current Business Track trial shows that phone-tapping is still alive and well and possibly conducted by those who were doing it 10 years ago.  Why would there not be a library of 1990-2000 videos of the Fujimori-Montesinos era stashed away somewhere, ready to be used as necessary? Fujimori fled to Japan with suitcases of videos, but why wouldn’t there be security copies somewhere?

Neither Mario Vargas Llosa, nor his son Alvaro, nor Peru’s leaders in the scientific, academic and artistic communities are giving Ollanta Humala carte blanche – they are there as referees for democracy, the rule of law, and human rights.

If Humala becomes president he will have lots of time bombs to defuse and half the country will be eager to demand their long-denied rights. But the alternative is far worse.  And if democracy, rule of law and human rights are not a priority, the economy will not remain healthy for long.

OP-ED – The 2011 Election: Facing a leap back to the bad old days

By Nicholas Asheshov

Special to the Peruvian Times

With the short end of a week before voting on Sunday, April 10,  the first round of Peru’s presidential elections has lurched into a curtain-raiser to a bitter run-off featuring a stark choice between business-as-usual+plus and Chavez-style grab-it statism.

The polls say that Ollanta Humala, representing the specter of a depressing dive into Venezuelan-style shambles is way out ahead against a trio led by Pedro Pablo Kuczynski, a pragmatic free-marketeer promising a pueblo-friendly lift-off for an already-humming economy.

Under Humala, a far-left rabidly anti-Chilean, airports, ports and telecom, energy, probably banks, newspapers and TV would be nationalized, according to his written manifesto.  LAN, the dominant force in local aviation, would certainly be hobbled if not sent packing.  The same fate might await some of the big foreign investments in energy, mining and retailing.  The half-forgotten sound of international agreements and contracts, not to mention constitutions, being torn up, is back on the air.

Brazilian companies, led by big construction and energy like Odebrecht, Vale do Rio Doce and Petrobras would, on the other hand, be favored.  Humala, like all Peruvians, likes Lula but, more to the point, his PDB party is providing electioneers and finance for the Humala campaign.   Brazilian companies are already trying to pepper the Andes with huge hydro-electric schemes with the power pylons heading for Sao Paulo.

Venezuela and Cuba are the models, “with appropriate local adjustments,” Humala says.

The media in Lima produce and discuss endlessly, as well they might, a flood of polls that after a ho-hum start at the turn of the year, today put Humala, a former army comandante and mutineer to boot, at close to 30 percent with Kuczynski, PPK, a former Wall St banker, and two others, Keiko Fujimori and Alejandro Toledo, bunched together at between 18 percent  and 20 percent.

The elections will see 14 million over-18s of a 30-million population vote for which of two candidates get into the final run-off in early June.  They are also voting on Sunday for a 120-seat Congress, whose membership will be roughly in line with the percentages obtained by the five leading candidates.

Both the Congress and the President are elected for a five-year 2011-16 term starting July 28, Independence Day.  Voting is obligatory.

With Humala, the only left-winger, a sure thing to get into the run-off, Sunday’s race is for the single remaining slot to run against him in June.

Luis Castañeda A fifth contender, Luis Castañeda, a colorless, murky former Lima mayor, is down from 30 percent support in January to below 11 percent.  So the focus is on Toledo, Keiko and PPK.  The hope of, one supposes, two-thirds of the electorate is that one of these will in June pull together the non-left votes to beat Humala into, they hope, oblivion.

The four contenders have emerged after more than three months of campaigning as clear-cut TV characters.

Humala Ollanta Humala, an army mutineer accused of human rights violations, was described on TV by Hugo Chavez in Caracas this past week as “a good lad, a good soldier.”   Caracas has provided much of Humala’s campaign funds according to well-established paper trails through, for instance, NGOs fronted by his wife, Nadine.  He has, naturally, got the Lima and provincial middle class frightened, terrified in fact, that Peru — which has been emerging over the past couple of decades into a coming-along economy with poverty rates finally ticking down — will slough back into the lost decades of the 1970s and 1980s.

Keiko Fujimori The polls say, as they have for the past three months, that Keiko, a self-confident 35-year-old daughter of former dictator Alberto Fujimori, currently doing life in a Lima jail for human rights violations, has a solid 20 percent of the vote.

She, in effect, is the one that Toledo or PPK must beat on Sunday.  She is also going to be the easiest to beat for Humala, as even though she would be joined, reluctantly by PPK and Toledo, she is not yet a convincing presidential figure.

Alejandro Toledo, 65, president 2001-6, only a few weeks ago looked a shoo-in to the final round with close on 30 percent in the polls.   He bills himself as a toughie Andean Indian ex-shoe-shine boy with a Stanford PhD.  Sounds ideal, but his record in office was as a vacillating, hard-drinking womanizer with approval ratings of 8 percent, marking him at the time the least popular elected leader in Latin America. Today he is still lively but a pompous bore on the TV, and this has hauled him back down despite a campaign that is well-financed by a foggy consortium.

Joining these leaders during the past few weeks is Kuczynski, PPK, an Oxford-educated Wall St banker and former Central Bank executive, finance and prime minister, one of whose daughters is a fashion-plate Park Ave socialite and former New York Times staffer.

Kuczynski, 72, is an accomplished flautist with a grand piano in his Lima town house and another at his mountainside country estate on which for relaxation he plays Bach fugues and Mozart sonatas.

Pedro Pablo KuczynskiKuczynski in 2001-2 sorted out the high inflation, low-income mess as the first finance minister in Toledo’s otherwise vacuous government, and has financed his own campaign – he sold a south-Lima beach house and cashed in some stock.  But until a month ago it was looking, at three or four percent in the polls, like just a quixotic swan-song.  Columnists were thanking him for, at least, pepping up a desultory melee.  At that time, too, Humala was also a back-of-the-pack also-ran at 10-12 percent.

But in February they both took off.   PPK drove a “PPKamion” and distributed PPKuy dolls — cute fluffy guinea pigs — to attract a wider audience for his well-thought-out program and hands-on experience to get Peru’s lagging education, health, jobs, pensions and infrastructure adjusted upwards to a pushy 7-8 percent growth economy.

Suddenly PPK shot up to 10 percent, then 14 percent.  Now he’s up in the 17-18 percent league with one poll putting him second behind Humala.

Humala, starting as a cloudy has-been, has more than doubled his early-days polling.  But unlike PPK he is no dark horse.  In 2006, he came within a few points of becoming president of Peru, wearing a red T-shirt and openly fawning on Chavez, then as now the only important re-creation of Latin America’s bad old 1970s and 1980s of muddled stagflation and bully-boy caudillos.

For this election Humala has put on a coat and tie.  He refuses to answer questions about his published Chavez-like program. the familiar, dreaded  paraphernalia of up-the-workers cant.   His brother Ulysses has created a stir by going public with a description of him as a little-Hitler dictator.

Another brother, Antauro, a cashiered army major, has been in jail the last six years  for leading a paramilitary gang in an attack, which Antauro says Ollanta planned, on a provincial police station that killed four unarmed policemen.

In the 1990s, Ollanta led an army mutiny against Fujimori in the mountains of the far south.

His rabid anti-Chilean position connects with a thick top-to-bottom atavistic seam in Peru’s often-moody psyche. This appeals especially to Peru’s grouse-patch millions, and not just out in the sticks:  Humala is as strong in Lima as PPK.

A wider xenophobia, typical of elections everywhere, has slimed its way selectively through the campaign.   Now that he might win, Kuczynski has been attacked ferociously by Toledo and Humala for having a U.S. passport, acquired in 1999 — Kuczynski’s wife Nancy is from Wisconsin — with, therefore, clear conflict-of-interest issues.   PPK replied, variously, that Toledo might have thought of this when he made PPK his Premier in 2005 and that he was relinquishing his U.S. passport anyway.  In a TV debate on Sunday, Toledo, who lives in Palo Alto, Calif., and whose acid-tongued wife, Eliane, is a Belgian Zionist, referred to PPK as “Mister Kuczynski” as if they’d never spent hundreds of high-powered hours together running the country.

PPK was born in Lima in 1938, his parents refugees from Hitler.  His mother was a cousin of Jean-Luc Godard, the French cineaste and his father Max was a Berlin-born medic who founded a hospital for lepers in Iquitos and, in effect, eradicated leprosy from Peru.  He was also active in the high country of Cusco and Puno as a doctor. PPK has photos of Dr Max and himself as a kid in the backwoods of Peru in the 1940s.  Max even spent the best part of a year in a Lima jail as a political prisoner under the dictator General Odria, in 1948.  Max sent Pedro Pablo to Rosall, a tough boarding school in northern England, from where he won a scholarship at the age of 17 to Exeter College, Oxford   A few days ago PPK, campaigning in San Cosme, a desperate Lima slum, ran into an old man, a former leper rescued more than half a century ago by Max.  It was, as can be imagined, an emotional moment.

PPK, never a shrinking violet, has developed a relaxed-but-quicksilver, folksy-but-serious TV and campaign-stump style. To his followers he is way and ahead the best potential president that Peru could want.  He fits in today, too, to a current that has seen Ricardo Martinelli in Panama and Sebastian Piñera in Chile, both tip-top business figures, leading lick-things-into-shape governments.

But Humala, too, represents a well-established presence:  Chavez in Caracas, Evo Morales in Bolivia and Correa in Ecuador, Ortega in Nicaragua, even the Kirchners in Argentina.

ENDS, as usual, we know not where.

Nick Asheshov is a Director of The Machu Picchu Train Co., Urubamba.
A veteran journalist, noted explorer and entrepreneur, he was editor of the Peruvian Times from 1969 to 1990.
This report was prepared specially for the Peruvian Times.

A change of air, new perspectives

By Eleanor Griffis
Peruvian Times Publisher——–

Susana Villaran will be sworn in as the new mayor of Lima on January 1, on the promises of transparency and inclusion.  The thunder of her win was stolen by the drawn-out counting of observed votes, but in the end the exit polls prevailed.   As she offered in her slogan, hope did indeed conquer fear, but only just.  She won by a hair’s breadth, not the wider margin she held in late September, when the polls showed up to a 10 point lead over her closest contender, Lourdes Flores.  Read more…

Reader’s comment on Peru lawmaker’s reaction to Arizona’s illegal immigrant law

Dear Peruvian Times Readers,

It has come to our attention that the “Comment” form on our Web site is not working properly, and we are working to fix the problem as soon as possible. In the meantime, we received the following message from one of you concerning our story posted April 29, titled “Peru’s foreign relations commission to analyze controversial Arizona law, “ offering a heart-felt, alternative perspective.

The views expressed below by Mr. Rodriguez in no way reflect the editorial position of the Peruvian Times. Read more…

Why to root against The Milk of Sorrow’s Oscar nomination

By Rick Vecchio

It was with bemused surprise that I saw Claudia Llosa’s “The Milk of Sorrow” nominated the other day in the category of Best Foreign Language Film for the 82nd Academy Awards. But the slow groan of disbelief didn’t really start rumbling in the back of my throat until the  Oscar nod was hailed by Peru’s government as a huge advance for the country’s image in the world.

“This nomination will bring Peruvian destinations into fashion and will be key to boosting tourism in Peru,” declared Peru’s minister of Foreign Trade and Tourism, Martin Pérez.

A remarkable statement, if you believe, as I do, that “The Milk of Sorrow” does for Peru and Peruvians what John Boorman’s “Deliverance” did for the Appalachians and the mountain people of Georgia. Read more…

OPINION: The Innocence of the Guilty

By José Luis Mejía
All politicians are guilty, or almost all of them. If they were judged by a court made up of good men (in the true sense of the word) –as the Spanish poet Antonio Machado would say—nine out of ten would land up, bones and crimes, in jail. Power corrupts and few go through the Government Palace without getting their hands dirty, with money or with blood, which is why they make laws with back doors, enact special rules and weave a legal web that guarantees their impunity. Read more…