PayPal Set to Suspend Domestic Transactions in Argentina
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All this does is create an artificial currency value and a rampant black market. The official value is Bs. 4.3 per dollar. The black market value is Bs.10.5 per dollar. You can imagine what this does for the inflation in a country that does not produce anything else apart from oil. That is why we have an annual inflation rate of around 27% (cannot look it up, I'm on my phone.)
We basically have a 'port economy',where everything is imported, with no incentives towards increasing local production and manufacturing. Add to that a government that is consistently destroying and confiscating private enterprises and you do the math.
It appears that external exchanges are giving 4.66 per dollar. If you examine the exchange history, the increases started ~2009 and may hit 5.00 in 6 months.
By which I mean, not what Mussolini did to Italy, but what the Italians did to Mussolini after Patton liberated them.
Finally, inflation is rampant (around 25% annually) but the government denies it and so it can collect more taxes since salaries are going up every year and more people fall into high-income tax brakets.
In a nutshell, the economy is not that bad, but the government keeps screwing up and everyone can see we're going down.
There are country-wide protests right now, here you can see them: http://tn.com.ar/envivo/24hs
There is a lot of corruption.
The president said, on TV, that the people must be afraid of her.
There are a lot of products that are not available anymore, for example, pacemakers (a relative of mine needs a new one and, at the moment, there are none available).
A picture of the protests of today: http://sphotos-e.ak.fbcdn.net/hphotos-ak-ash4/c99.0.403.403/...
Edit: let me add, Argentina is great, there are great people creating companies or doing amazing stuff; but the general climate for doing anything good is becoming terrible. If you want to do anything as an Argentinian, you have to fight against lots of obstacles, or you have to emigrate. It is really sad. Argentinian entrepreneurs are survivors of some of the craziest stuff you can imagine.
Still all was not good. A lot of families were taking on boarders to make ends meet, and corruption was pretty rampant. The general sense I got was that, if the politicians only got their shit together, the country would be better off.
Let's follow that thread all the way through, shall we? So, PayPal begins ignoring the laws of Argentina while continuing to operate there. The Argentine government then forces all of the local banks to close out all of PayPal's local financial instruments (bank accounts, etc.) blocking them from doing business in Argentina and effectively confiscating money belonging to PayPal and its customers. Next, PayPal and its executives and agents are put on trial in Argentina, convicted, and those folks can no longer visit Argentina or any other country that has an extradition treaty with Argentina.
Meanwhile, other countries take notice that PayPal does not seem to care about abiding by the laws of local sovereign states and PayPal finds it harder and harder to do business with any country, and finds itself increasingly locked out of countries.
This is in no way a sound business strategy.
I lived there for many years. I saw it first hand. I also became aware of the history and how corruption and manipulation has been a core part of governmental culture.
In conversations with friends I can't help but draw parallels between what has happened in Argentina over the decades and what happens in the US.
One of the most famous examples of government manipulation and vote-buying was when Evita (way back when) would show-up at neighborhoods and hand out bikes, refrigerators, blenders, etc. to the population. Of course, they were buying votes. Same with their "sindicatos" (unions) and other groups.
These governments have used the guise of socialism (down with the rich, etc.) to drum-up popular support and remain in power. The reality is that most of them should probably have been tried and thrown into prison for treason.
In the US the Democratic party exhibits some of these traits. The corruption in places like Argentina is very obvert. It's amazing how everyone knows about it and it is very much a matter of daily national conversation.
Here in the US it used to be more subtle. Not now. Democrats openly channel benefits towards government and private unions as a way to buy their votes. If a being from another planet landed in the US and listened to Obama speak it would conclude that the only important people in this nation are "teachers, police, firemen and construction workers". Why? Because that is all he mentions in his speeches. Translated: "union, union, union, union".
If you succeed in buying union ("sindicato" in Argentina) votes you are buying the votes of their immediate family as well as all union retirees. That amounts to millions upon millions of people. Brilliant, if you think about it.
It goes far deeper than this. The Argentinian goverment figured this out a long time ago. Create class divisions. Get those on the dole worked-up about those with money. This guarantees millions of easy votes and you remain in power. It is also easy when this ideology permeates colleges and universities and kids come out of school actually believing this shit. If you are a college or university graduate, pull way back, realize that you may have been subject to indoctrination and try to see the world for what it actually is before parroting what your radical professors told you.
What's sad about this is that, both here and in Argentina, it all comes at the expense of the country in general. Those in power remain in power and live the good life (Another vacation or golf trip Mr. Obama?) and truly live outside of the realities of the country. The masses get their blenders, bikes, refrigerators, playstations, bonuses, etc. and buy into the idea that they are being oppressed by everyone and are entitled to take from everyone in order to live. The country goes to hell and nobody wins. Our kids will have to deal with the real consequences of this mess.
Argentina is a warning to everyone in the world. Watch and learn. See what can happen when government goes wild and acts not for the benefit of the entire country but for themselves and nobody else. Manipulating the masses is a tried-and-true way to acquire votes with few, if any, real consequences after the fact.
I have friends who still live there. Some have businesses and are terrified. Some are doctors and are living from paycheck to paycheck --if they get paid at all. Nearly every Argentinian has stories of someone getting held-up, sometimes at gun-point, when coming or leaving home or going about their daily life. The government does nothing. And, in fact, a lot of these criminal elements end-up being the voting masses that support them (living in favela-type encamptments all over the place). It's amazing to see people who live like shit support the very party that keeps them there. In the US that's welfare recipients. Legalized vote buying. How many welfare recipients do you think ever vote Republican? How many people in Argentina do you think vote for political parties who will take away their entitlements and put them to work for their own benefit and that of the country. Right.
The solutions to these problems can only evolve internally.
In Argentina I am afraid that it might be so far gone that only a major event, such as nation-wide unrest and an ousting of the government can ever hope to find a solution. This wouldn't be the first time this would happen over there.
In the US it is still thankfully quite civilized. All you have to do is be intelligent about how you vote and things can change.
As a Libertarian I have to make a choice between two parties that don't quite represent me. So, in many ways, it is about the lesser evil. Casting a vote for a Libertarian candidate would, at this juncture, be irresponsible.
Casting a vote for the Democratic candidate would be even worst. The last thing this country needs is more union workers earning $300K for life when they retire. I could not, in good conscience, saddle my kids and the generation after them with that ridiculous burden.
And, while I don't necessarily agree with all of the Republican platform (I'm an heterosexual atheist and don't have issues with gays at all) I must cast my vote in their favor. I, for one, would really like to see what a real businessman could do with the mess we have created in the US over the last fifty years.
Obama was an exciting bet in 2008. In retrospect, the guy wasn't even qualified to run a cookie baking operation, much less an entire country. We made a mistake. I hope we all fix it in November.
Still, I can't agree with your "Democrats are shit, so you should vote Republican" argument. Sure, it might sound like you are changing something, but at the end of the day they are all driven by the same interest groups.
Funny, I say the same thing. I was educated in three different cultures and graduated high-school in both the US and Argentina. What can I say, my parents got around. They are entrepreneurs and had businesses both in the US and Argentina. My father tells some amazing stories about what it was like to do business there. One of my favorites was when his clothing factory got a surprise visit from a high-ranking local military general. He showed-up with two trucks and fully armed soldiers. Went into the office with my father and walked away with an envelope with cash as well as a huge pile of merchandise. The cost of doing business. Talk about having to have balls of steel. Not sure I could do that, and I've been around.
> Still, I can't agree with your "Democrats are shit, so you should vote Republican" argument
I didn't really say that. I drew a parallel between the way Democrats, effectively, throw money at union workers to buy their votes, the votes of their families and those of retired union workers. Unions, in the US, are a solid unified voting block that always votes Democrat. That does not happen across groups of millions of people unless their vote is being bought through benefits and more.
Please tell me, what are our options? Only two people have the ability to win the race: Obama or Romney. I supported Obama in 2008. I can't rightly do that today. His re-election would mean that union will grow stronger and receive more benefits and support than they should. That, as a single issue, is a deal-breaker for me.
Very, very sad.
Politics aside, this is faulty logic. Unions vote for Democrats because Republicans support policies that make unions weaker. It's a genuine policy difference, and they both have logical arguments.
The fact that there are those who believe that those policies are wrong is meaningless to the voters. The group will vote for those who give them things, plain and simple. And they will do so even at their own peril. Case in point: How many cities have now filed for bankruptcy protection broken under the weight of pensions that cannot be supported?
The only regulatory element in the feedback loop of the whole unionized labor equation is complete and utter failure. Nobody is going to say something like "Wait a minute, who's going to pay for these exorbitant lifetime pensions? Let's scale it back and make them reasonable." No, they'll take and take and take until the goose is dead and no more golden eggs can be produced. This, to some extent, is human nature.
Given that, it is only natural that these groups will not support or vote for those who come forward and expose reality. Nobody likes being wrong. It becomes tribal, us vs. them, and all reason is lost.
Simple exercise:
Hire a gardener for $100 per month to take care of your lawn.
Let's say he retires after five years (to speed up the example).
Now, by contract, you have to continue to pay him $100 per month for the rest of his life.
But, wait a minute. You still need a gardener.
No problem, you hire another one at the same $100 per month.
The issue is that, now, the same position costs you $200 per month, $100 for the guy doing the work and another $100 for the guy who retired.
Repeat that five years later. Now the same position costs you $300 per month.
Of course, the gardener's union will favor and vote for those who will keep this gravy train going, regardless of the fact that it is killing the goose. And yes, anyone who dares bring up the reality of what is going on will not only not get their votes, but they'll also be treated to their attacks and ire. The funny thing is that reality and mathematics don't change and eventually the house of cards comes crashing down.
This is an over-simplification, but it serves to illustrate one simple reality of the union problem. Democrats give them more and more, and that's why they continue to vote for them. Mathematically, with sixteen trillion dollars in debt this situation cannot continue for too long. We'll see what happens when the music stops.
So, yes, people like me are saying: It's time to stop this madness. And, for that, we are hated and ridiculed. That's OK.
Anyway, this clearly isn't the right place for this discussion, but I don't think highly voted incorrect statements should be allowed to stand unchallenged.
[1] http://www.time.com/time/business/article/0,8599,1902009,00....
From the very article you linked to, in the very first paragraph:
"The plan gives the union's health-care vehicle some promissory notes, plus a 17.5% stake in GM and warrants to purchase another 2.5%"
It goes beyond that. The government bailed out GM. That's obvious. We, the tax payers, now own some 500 million shares of the stock. This stock would have to be sold at some $53 per share to just break even. Google it. We are taking a huge loss to benefit the unions.
Lastly, one of the reasons GM is doing well is that the government has vectored a ton of business towards GM. We, the tax payers, are buying brand new GM cars at a time when government should be making due with what they have and save us money. This is a secondary and never-ending bailout.
Translation: We got your back. Vote for us when the time comes.
Using taxpayer money to buy votes. Brilliant.
Want backing articles? Fire-up Excel and Google it. Do the math, don't just take in left-wing articles and use them as the truth. Don't take right-wing articles as the truth either. It's amazing how easy it is to clear the bullshit out of some of this stuff if people would just take the time to take paper and pencil and do a little math.
I don't have an issue with unions getting more benefits. It's not a coincidence that high-paid individuals, like those in our industry, don't feel the need to unionize while blue-collar workers do: they are the segment of the population getting the lion's share of the recession's consequences.
As much as I hate discussing taxes (specially with Californians who love telling you how left-leaning they are until you touch their taxes) the issue is very clear: the breach between rich people and the 'slaves' in the 'lower classes' is getting bigger and bigger. There's no way in hell that's good for the country (although, there might be an argument in saying it's good "for the economy" if you don't factor social inequality) in the long term, no matter how you look at it.
The democrats buy votes by making concessions to unions and those on entitlement programs. Because that is a huge portion of their voters they have no choice but to keep shoveling money at them.
Republicans, on the other hand, shovel their bullshit at the religious majority, among others.
The rich? How many votes do they represent?
No, elections are driven by the masses, and each group has no choice but to buy their votes in different ways. Once you start down that path it is hard to turn around. Just like foreign aid: Once you start buying friends you can't stop because you'll loose your "friends".
Then there are those of us who are willing to consider actual facts and can't be bought. We vote not based on tribalism or blind allegiance to a party or ideology but rather on an attempt to be rational and choose what might be best for all rather than mindless organized tribal groups. And, no, we don't have a monopoly on making the right decision. A great example of that is that some of us today regret having supported Obama.
All I am saying is, watch what happens in countries like Argentina because that same tune is being played here in the US. It's different. The players are different. The methods and tactics are different. The visibility is different. However, the outcome is likely to be exactly the same: The slow and steady destruction of a once prosperous nation.
This, as an entrepreneur, should keep you up at night because almost nothing can affect the outcome of your endeavors to the extent that bad national and international political forces can. Just ask those of us who saw our businesses grind to a halt during 2008~2009 if being a great entrepreneur in that environment was enough to keep the boat afloat.
Ideology is great until reality smacks you in the face and sits you on your butt. The lessons of Argentina should not be ignored because they are very relevant to all of us.
> Here in the US it used to be more subtle. Not now. Democrats openly channel benefits towards government and private unions as a way to buy their votes.
What "then" and "now" are you talking about? Democrats have been aligned with unions since at least FDR.
> If a being from another planet landed in the US and listened to Obama speak it would conclude that the only important people in this nation are "teachers, police, firemen and construction workers". Why? Because that is all he mentions in his speeches. Translated: "union, union, union, union".
I don't know why you think this is the case. Lets see, let's take an example from a speech directly to the audience most friendly to him; the DNC. And let's list all of the occupations that he mentions in a positive way:
1. soldier in Patton’s Army 2. work on a bomber assembly line 3. people in the shadow of a shuttered steel mill 4. teachers 5. students 6. scientists and engineers 7. small businesswoman 8. construction worker 9. workers ... who feared they’d never build another American car 10. business leaders 11. manufacturing jobs 12. jobs today building wind turbines 13. farmers 14. scientists (again) 15. construction workers (again) 16. teachers (again) 17. principals 18. students (again) 19. Americans who still serve in harm’s way
So, he mentions soldiers several time, scientists several times, businessmen/women several times, teachers several times, construction workers several times, students several times. He mentions farmers once, principals once, engineers once, and a few assorted manufacturing jobs (whether you count that as one item or not depends on how you categorize them). He mostly criticizes Wall Street and bankers. So, yes, he does mention the people you mention, but he mentions a bunch of other people as well.
> The last thing this country needs is more union workers earning $300K for life when they retire.
You are going to seriously have to stretch to find such unionized workers. Sure, you may be able to find one or two here or there to use for anecdotal evidence, but a few anecdotes do not make good evidence. Median wages for unionized workers are $917 per week (~$48,000 per year), median wages for non-union workers are $717 (~$37,000 per year). Source: http://www.bls.gov/news.release/union2.nr0.htm. And the premium for union membership is much higher for lower-wage jobs than higher wage. Source: http://lcc.aflcio.org/WhatsNewDocuments/EFCA/LowWageWorkers....
Unionized workers are not, in general, fat cats making six figures without working. They are lower wage workers who happen to have gotten a somewhat better deal than they could have individually via collective bargaining.
See a trend there? Pretty much everybody on that list has their hand in the government's pocket. Don't get me wrong, the Republicans aren't better ... but at least they'll lie to me and tell me sweet things. I'd rather be lied to.
The problem is much more complex. But, I think that all problems start with disappearance of middle class which causes people to "sell" their votes (and rich/powerful ones are more than willing to pay for these votes). That then leads to corruption, etc. vicious circle to the bottom.
Or...you could vote Libertarian.
Instead, he must choose the party that, while not quite representing him, does the least to harm him and the country.
That's the situation, at least until we come up with a better electoral system than what we have in the US.
Abstaining from voting strengthens everyone else's vote that much more, indicating that I don't care who wins. I opt to select a candidate that I know will not win but aligns with my views because a) the idea of selecting the lesser of two evils disgusts me, and I will have no part in it, and b) it actively indicates that I do not want either of the major players to win.
Yes, I'm of course perfectly aware that this has precisely no impact in the final tallies (I live in California, the state's delegates have been decided long before the election; this has been true everywhere I've lived never having lived in a swing state) - not at America's scale. But it helps me sleep at night knowing that I took a (uselessly tiny) stand, and far more importantly, can be explained to people in such a way that allows them to realize that they can do the same. If that message spreads far enough, it could actually turn into real impact.
I with you. Well, I used to be with you. Until I realized that part of our responsibility is to help steer the ship in the correct general direction.
Voting for someone who cannot hope to win (or not voting) means that there's some probability that the better of the two candidates who could win might loose. In some cases the lesser evil could mean the difference between hitting the iceberg or scraping it. And, as disgusting as the idea might be, I'd rather scrape it.
I, too, live in California. Here's a thought: What do you think the message would be --to the nation-- if California produced a majority Republican vote in November? To say that this would send shock-waves through the political system would be the understatement of the century. It would signal huge discontent with the direction of the boat and it would put all politicians (from any party) on notice: Things are no-longer the same.
This is what I am talking about. The message you want to send is but a rounding error. The message that could be sent by supporting the "other" party would be equivalent to the earth's poles flipping overnight. That's a message.
I'd argue that would "put all politicians" on notice, much faster than simply playing tug of war between the same two parties over and over and over again.
The vote here is actually irrelevant (other than I refuse to not practice what I preach). The important part is spreading the idea of not limiting votes to the two main parties if you feel a third party candidate better aligns with your views. I want people to stop trying to outwit each other when voting and just vote for who they actually want in office.
It's also partially due to the fact that I feel both mainstream candidates are equally poor choices, just for different reasons. On the issues I care about, they tend to have the same policies (maintain the status quo, just wrap different politician-speak around it).
The reality is that I have effectively no chance of eliciting real, substancial change in the political system without becoming a part of it (either by running for office or buying off someone already in office - err, sorry, donating to their reelection campaign), and I'm having difficulty thinking of something I'd like to do less. So long as a principled message will have no substancial effect regardless of the route I take, I'd at least like that pointless principled message to be in line with my own views.
Here's what you're doing: You're reading something and drawing connections to beliefs you already hold. Fine, we all have biases. But in this case, you're acting on them to do some political stumping. Politics is a subject best avoided on HN, it's explicitly mentioned in the guidelines for a reason. If you MUST make a political comment, it should be something that "gratifies one's intellectual curiosity."
For example, if you were an Obama supporter until you read this article, your conversion process would be interesting. Urging others to vote Romney would still be a no-no, but the rest of your rant would be interesting.
As it is, I have this fear that anything remotely connected to economics, jobs, unions, or corruption will trigger you to post a variation of the exact same rant, which will trigger pretty-much the exact same debate, and HN will circle the drain a little faster.
Live in a country like Argentina for a few years. See, hear and feel how a country is destroyed, financially, culturally and morally raped by populist rulers. Then go live somewhere else and watch, in total disbelief, that same movie replayed for you in slow motion.
Then, and only then, will you be able to recognize the duck.
From the vantage point of the US, and without that external perspective it is easy to discount someone drawing a parallel between the events in Argentina and the US as a total lunatic. And that is your prerogative. Ask anyone living in Argentina if what is happening to them happened as a single large change or a series of small changes down the proverbial slippery slope. I know the answer to that question.
Regardless of what Paypal says publicly, I assure you that what they did was the result of someone in government threatening to shove a boot up someone's ass.
What, you don't think politicians can do stuff like that? Perhaps you also believe that voting can't be rigged or altered at will by politicians:
http://m.youtube.com/#/watch?v=ST-eE4Ud7nw&desktop_uri=%...
If you are a tech entrepreneur, like it or not, politics can and does affect your life. From patent laws to taxes and beyond. It is important to at least have some perspective beyond that provided by the one-sided media so set on indoctrinating American voters (on both sides).
There needs to be a third option and we are not ready yet for that, but very close. No matter how many times dems and reps alternate, things won't get better. But the worse they get, the more people awake and take part in politics.
I'd like a third party, like the pirates in europe, unfortunately that won't fly far here, but something along the lines. Some new people with new ideas that can inject fresh blood to the already dying political class.
The more you fuck your own people, and push them to the bottom, the easier for a populist to come and wash the masses with romantic speeches about revolution.
There will be protests, stronger than 'occupy', there will be riots, there will be blood, and we have to avoid that at all cost.
We are in a perfect time to get together, using the tools no politician has used before to reach people with a real message of hope, to raise funds for our cause, to build a solid platform for change. It is in our own hands.
Corruption is killing corporatocracy, we saw it first with enron, worldcom, adelphia, and others. We saw it again with fanny mae, and all wall street gangs.
Nobody cares about "the people" anymore, only about their pockets. We have to change that, we need to stop that. We need to get back to our roots and dream again about being a great nation, land of prosperity, not about a predator that eats its own sons and daughters, somber land of corruption.
The time has come.
In which country are you?