[A long post follows - I hope it is interesting to at least a few on
the list (I'm thinking especially of Ivan Ordoñez)]
Despite living here in EC for 7 years, I'm still trying to figure the
place out. There are so many things I could say about it, but most
would be just sort of gut feelings. My Spanish reading skills have
only recently reached the point where I can read newspapers with
little enough pain to make it worthwhile.
First, the good things. The country is extremely varied
geographically. It is about the size of NM, with a population of about
13 million. We have Amazonian jungle, mountains over 21,000 feet,
Pacific beaches, and then of course the Galapagos. I live at about
6500 feet elevation, so I don't need much heat, and never any cooling.
It's amazing living on the west slope of the Andes. I can drive half
an hour and get an increase in temperature of about 10 degrees F,
another half an hour for another 10 degrees. Or, I can drive half hour
up our gravel road for a decrease of 10 degrees. So, up to a 30 degree
temperature range in an hour and a half of driving. It's very
beautiful where I live, but quite cloudy (that's why it's called cloud
forest :-) People are generally very friendly here, but the idea of
"the truth" seems to be a little flexible. Non-prepared food is cheap,
especially fruits and vegetables. It is still legal for foreigners to
own land here, and land in rural areas can be bought for between the
low hundreds of dollars per acre, up to thousands. You can get
permanent residency by several means; Karen and I did so by investing
more than $25K by buying land (and then building two houses on it).
In my opinion, the bad things pretty much begin with the current
government. Rafael Correa swept into power in 2007 on a populist
platform modeled laregly after Hugo Chavez of Venezuela - many have
called him "Chavez Light". At first, he was pretty moderate, and spent
all of Ecuador's income from oil (I believe we are a member of OPEC),
which was high because of the price of crude, on infrastructure
projects. I wholeheartedly support investing in infrastructure. So
though I was initially a little skeptical, after 8 years of GW Bush, I
had convinced myself that leftist governments are a good thing.
However, within a couple of years, the entire national assembly was
from Correa's party, and the populist rhetoric, replete with
rich-vs-poor talk, steadily increased. Then he loaded the courts with
his supporters, so with all three branches of government, he has
pretty much gotten whatever he wants. He has a huge ego and hates to
be criticized. So, he started passing laws restricting legitimate
criticism, much like Chavez. After a couple of journalists were fined
millions of dollars for "libel" against Correa, criticism pretty much
died, and many people became genuinely fearful to say anything
negative about him in public.
When the price of crude dropped dramatically, there wasn't enough
money to feed his newly created huge bureaucracy. So, he turned to a
few countries, especially China, and got high-interest loans. At the
moment, I believe EC is in debt to the tune of $35 billion, and even
with crude prices going up somewhat, there still isn't enough cash
being collected to maintain the bureaucracy. At first, he merely added
"safeguards" (basically import quotas and higher import duties). After
all, this only affected "the rich". Even that wasn't enough. So, he
made a mistake that may (I hope) be his downfall. He proposed large
capital gains taxes on real estate (I'm not sure, but my impression is
that this may even apply when you don't sell).
But the extremely unpopular thing that he did was to propose
progressive high inheritance taxes. EC, like most latin countires, is
very family oriented. He made the mistake of criticizing the ability
to pass property down to heirs with little tax, and that struck a
nerve. One remark that he made went like this: if you have property or
a business worth, let's say $500K, and you have five children and ten
people working for you, you can leave each child $100K, which would
put them into the 72% tax bracket, which would mean they would each
have to raise $72K just to receive their share. But, why not divide
the estate into 15 parts, leaving $33K to each child, as well as to
each worker? That would put them all into a much lower bracket,
allowing them all to inherit their small amount tax free. That's
pretty much when the shit hit the fan. Even communist-leaning folks
tend to have a dim view of leaving the same thing to their workers as
they do to their kids, especially here in family-oriented Latin
America.
So Ecuadorians have recently found their voice, especially the middle
class. Emboldened by anger over his anti-family stance, people have
finally started vociferously criticizing Correa. Starting a couple of
weeks ago, people have been peacefully demonstrating in the streets by
the tens of thousands in Quito, and even more in Guayaquil. I believe
there were estimates of up to 300K people in Guayaquil alone
demonstrating against Correa on June 26. In Quito, a group numbering
in the tens of thousands marched to as close to the presidencial
residence as they could get, chanting "Fuera, Correa, Fuera!" ("Out,
Correa, Out!"). [#FueraCorreaFuera] They even broke through the police
lines, but Correa himself was off somewhere else giving a speech to
his mass of supporters, numbering in the low hundreds in that
particular location.
So, it isn't clear what's going to happen. Oh, the other thing that
Correa has been pushing for is a change to the Constitution to remove
term limits (he is two years away from the end of his second term,
which is all that is currently allowed). The assembly apparently could
amend the constitution by itself, but polls show over 70% in favor of
a national referendum, which almost certainly would go against
indefinite re-election, and thus, against Correa.
The next few months will be pretty interesting, to say the least.
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