#637 – The Expat Files: Immigration, Corruption, and Economic Challenges in Latin America

Automatically transcribed from the original recording; names and wording may contain errors.

[00:00] South of the border down Mexico way That's where I fell in love when the stars above came up to play and now I wonder Hello there all you expat wannabes. I'm Johnny Mueller and you're listening to the expat files living in Latin America The show that tells you just what it's like to live work play and or retire down here in Latin America It's a mix of the good the bad the ugly and the great and it's all right here So let's get started a couple of shows ago I mentioned that when you watch the six o'clock or nightly news here in Latin America They'll always be at least one report coming directly from the US Coming from a Latino or Latina corresponded somewhere and usually a big city in the US like Chicago or LA New York

[00:48] They'll be covering immigrant protests or illegal immigration, whatever Since that's all the rage now, you know, in fact, they're famous for Latin man and lady on the street interviews Deportation immigrant rights separation of families and all that crap. By the way We're always hearing people whine about separation of family. Hell Who do you think separated the family in the first place the guy or the woman took off from their Latin home and headed a couple Thousand miles up to the states. So who broke up the family in the first place? I don't get it You're aware, of course that whole families just don't pick up and leave It's usually the breadwinner the guy or the woman and they almost always leave their conjugal partner and a couple of kids Back in the home country. So again, I repeat. I just don't get this whining about separating families Oh, and I can't tell you how many adult Latin males I've met here in Latin America who left for the states got deported

[01:40] Now they're back in their home country with their wives and kids and guess what they left behind another wife and kids up in the states Yeah, there are a hell of a lot of big amiss latin males running around. I'll tell you that I can't believe how many have double lives and double families one up there one down here Don't think that's a rare case either. It's not oh, and if you think I'm exaggerating come on down And I'll introduce you to a few deported individuals who got caught up in that kind of thing In fact, one of those macho guys Hakko told me it's easy to keep that game going Especially if your second family is 2,000 miles away from the other He said in most cases the secrets absolutely safe. The families don't know about each other until some disaster strikes like ice

[02:25] Catching you and deporting you. Yeah, those are their righteous kind of immigrants You want sneak it into your country, right? And you know just when you think you've seen it all Guess what? I saw last night on Latin TV live from Los Angeles There was a Latino immigration lawyer US lawyer of Latino descent Inside a sort of lower middle-class apartment with a husband and wife and two kids of Latin descent And what they were doing for the viewing public was acting out an immigration raid with the lawyer Giving the legal family advice along the way on how to avoid being picked up or at least how to delay it So it started with ice showing up at the door knocking with the lawyer Advising the viewers each step along the way in Spanish, of course using bullet points that would appear on the screen

[03:16] I'm not kidding you they had two actors at the front door in ice uniforms With the family standing inside the foyer and the lawyer giving advice along the way For example, when the knock came on the door the lawyer advised them not to answer it and to stay still and quiet But the actors in the ice uniforms didn't go away They walked around the place took a look in the windows and came back to the front door again and shoved a paper under it Whether that was supposed to be a summons or whatever I don't know cuz they didn't show it but as soon as the Latino head of the house bent down to pick it up The lawyer stopped him and said don't even touch it He said if you even touch it at any time in the future if you're under oath And they ask you if you touched it and you say yes That means you officially received a summons or a deportation notice. Yeah, yeah

[04:06] So those are the kind of reports have been putting out in the latin news channels lately now This is the third time I've seen latin lawyers up in the states pulling that stunt and since I watch very little TV You have to imagine the latin airwaves are just full of those kind of reports, which brings me to an email I just received it comes from longtime listener Jay. He says hey Johnny Just thought I'd send you this link about US immigration officials actually making a trek to Mexico and Guatemala Lecturing the locals to stay put in their own countries. Do you know anything about this? I imagine it's big news down there south of the border. Are they calm or are they having mass riots yet? Please let us know sign Jay. Well, yes, Jay. I've known about this for a while

[04:51] Seems like for the past six months or so now every time a plain load of Illegal latin immigrants is sent back to their home country They get a pamphlet a happy meal and a lecture from some deadpan overpaid US official Advising them sternly that it's not in their best interest to sneak back into the states as an illegal and you might ask how effective Is that well, you know the answer to that The fact is nearly every Latin person has got a brother or a cousin or an uncle Julio Who's done many round trips to the US and had the deportation costs paid by who else the US taxpayers, of course So anyway, Jay sent me a link to a Reuters article on that very subject The title is US Homeland Secretary Kelly warns Guatemalans to stay home

[05:38] Then it says US Homeland Security Secretary John Kelly on Wednesday told Guatemalans not to waste their money trying to get to the United States illegally again to detailing how his department was cracking down on Undocumented immigrants and would speed up deportations He said this speaking after he greeted a plane full of Guatemalans who'd just been deported back from the United States He continued if you're a Guatemalan who's considering paying a great deal of money to a coyote smuggler to bring you back to the states You're wasting your money. He made that speech last Wednesday at a Guatemalan Air Force Base where 347 deportees arrived on an earlier flight back to Guatemala where they started from Hmm. I got a feeling he makes those speeches entirely in English

[06:25] It would be par for the course if he didn't speak a lick of Spanish, huh? Okay, let me paraphrase the rest of it. It says secretary Kelly left Guatemala shortly after that He was headed to Mexico where he and US Secretary of State Rex Tillerson Were expected to speak to another newly arrived group this time to deported Mexicans And then they were off to meetings with Mexican officials to explain Trump's new Immigration and deportation policies and also to meet and discuss issues with their Mexican immigration counterparts by the way It says US plans are angering Mexican officials with their lead negotiator and foreign minister Luis Dareder guy saying there was no way Mexico could accept Trump's deportation policies

[07:14] Well, thanks for that Jay. But meanwhile, here's something you didn't know How would you unless you read some of the local Latin rags and their own Spanish? Here's an article in a very big Latin newspaper that says Latin American countries are actively organizing educational campaigns and lectures Presented at various public schools in order to alert migrants who are about to start out on that journey and pass through Mexico Onto the states of the problems and dangers involved providing them with some effective training and counter measures If and when they encounter thieves criminals and gang members along the way then it says these government funded open public meetings come as a result of the fact that there are between five and

[08:00] 700 assaults and attacks a day on the migrant trail to the US Anyway, if you're watching this on YouTube right now There's a scan of a newspaper photo with a Latin cop giving instructions to a whole roomful of people each and every one of them Intent on sneaking through Mexico and on into the states now get this in the photo There's maybe 50 people in the class 45 women and five men So who would have thunk, huh? Latin American countries are now Holding formal classes given by cops in an effort to inform and train up people who they know are gonna sneak into the states through Mexico So they're there to get some tips on how to handle the crooks robbers rapists and thieves and gang members Some of them are bound to run into on their trek through Mexico

[08:47] Then it says the classes and lectures aren't normally given by members of the police anti-fraud units Then it says Anti-fraud unit cops are well versed in the tricks in the games coyotes often play on their own clients It says in many of the smaller communities in Central America or many immigrants come from you'll see the flyers on Power poles and government buildings advertising free classes for the prevention of coyote a staff us Which basically boils down to if you're gonna sneak into the US know your coyote now What are the cops who give us these little talks says fortunately these sessions are well attended often 30 to 50 people at a time However, he said gay last email, which means unfortunately, or it's a shame

[09:34] We have few young men at these sessions the men that do attend are almost always over 50 He says it's a cultural thing. I say it's a macho thing same thing I guess where young men think they can do everything by themselves and they don't want any help He said young men don't want to be perceived as weak or unmanly in a room full of older women And it's true if you're looking at that photo on YouTube you'll see most of the women are pretty much middle-aged Then the agent said yes Everyone's looking for a better life and they know there are risks they hear the stories the worst of which to them is rape Which is a real possibility especially with young adults and teenage girls That's why he says they have a special segment in their program on how women should act and dress That is never suggestively never with bright clothing and never using lipstick or makeup

[10:26] So there you have it illegal migration has actually become institutionalized within Latin governments In fact, they don't seem to discourage it at all rather try to prepare you for the journey like a commissary Oh Rodrigo Salguero said in this article. That's the cop giving the class He said according to the Banco de Guatemala in the last six months The country has received six billion with a B dollars in remisses And according to the Honduran Central Bank their country received three billion dollars in remisses during that same period El Salvador received two billion in the last six months and Nicaragua the same two billion by the way He said that's a 15 percent year over year increase in remisses. Meanwhile up in the states

[11:14] Everyone all US citizens in any way and the media are talking about jobs drying up high unemployment Little opportunity for the average Joe and even college graduates Which doesn't quite jive with the fact that remisses are up 15 percent year over here You figure it out either. There are more immigrants illegal or otherwise getting jobs in the states or They're getting pay raises and you're not hmm. Is that even possible? Oh, and by the way Here's something that just might blow your mind a little anyway Unless your brain's been pelted by so much bad news coming from the first world Nothing has much of an effect on you anymore in that case when you hear this You're just gonna think someone's making it up. Oh, well, this article comes from Mexico City's biggest newspaper and it gives you reason

[12:02] 2476 7 8 9 10 and 11 Why if you're thinking about setting up your plan B in Mexico, that might not be such a good idea I'll translate here It says a new type of tour offers sightseeing of the most corrupt spots in Mexico City you got that and I'll paraphrase and translate here It says as of February 5th 2017 Mexico City will have a brand new tourist attraction It's called the corrupt tour. That's c-o-r-r-u-p-t-o-u-r corrupt tour It will bring passengers on an old-school bus to ten different famous places in Mexico's capital That are associated with very high-profile Corruption scandals now admittedly it says it is a radically different tour than those usually provided by

[12:52] regular tourist agencies But the object is that all ten of the sightseeing spots have one thing in common endemic and pervasive corruption on a massive scale then it goes on to say the tour was first launched in 2016 in Monterey Mexico the capital city of Nuevo Leon and Due to the success of those tours Mexico City was the next choice so for the maiden voyage a list of special guests and media representatives were invited to the tours premiere on January 29th as planned the guests were brought to the ten enigmatic corruption sites on the tour Number one Mexico's president, Enrique Piñera Nero's quote White House

[13:38] number two the so-called pillar of light Estella de Luz number three the Mexican Social Security Institute the acronym is I MSS Number four the monument that stands near the 43 students who were recently Disappeared you read about that number five the Mexican Interior Ministry number six the Metro Balderas metro station number seven The Attorney General's office number eight the Chapultepec television building number nine The Mexican Senate and number ten one of the other many serious corruption sites to be selected on a rotating basis Then it says on top of the actual sightseeing the corruptor tour provides historical information on the chosen buildings and a brief overview of the corrupt acts to which they are linked

[14:28] Everything is narrated by the voice of two fictional characters Senor positivo in Senor negativa. That's mr. Positive and mr. Negative both voices represent the Mexican people's feelings on these events Combining humor and entertainment with the real facts and official investigation narratives The tour also notes the millions if not billions of Mexican pesos that are lost due to government corruption For example the billions lost to corruption in the acquisition of pharmaceutical pills by the Mexican social security system In fact, it says a study by the Organization for Economic Cooperation and Development Shows that corruption in Mexico accounts for 36% of all government services

[15:14] Hmm. I wonder what that figure is for malignant US government agencies Anybody have that info? It says by the way, the tour is very interactive as soon as it starts questions are thrown out by the tour guides They'll routinely ask questions like how many of you have been asked by your own children or relatives about corruption? And how many you have answered with a big knot in your stomach? What did you say were you able to explain it to their satisfaction to your own satisfaction? Anyway as the tour moves on the final stop is the Mexican Senate building it's our strategic final stop the tour operators say as She explains how the building and the costs of housing those legislators skyrockets yearly

[16:01] Then she adds the salaries of our legislators and their perks have recently doubled Of course, she says it's based on merit for such a fine job. They're doing oddly enough on nearly every tour bus ride Someone always asks the question aren't you afraid to keep doing these tours? Do you fear one day you might be shut down or possibly even disappeared for making such an open issue of rampant government corruption? And with that the tour operator usually laughs and says Every Mexican citizen knows the government's totally corrupt. Just like they know the sky is blue That's how our society works or more precisely sort of limps along So to point out what everyone knows already. Well, most politicians just shrug and laugh it off

[16:49] In fact, they're so thick-skinned about it that even a few of them came on our mated voyage and seemed to enjoy it immensely Since then other government leaders and politicians have bought tickets for future tours Alright, it's me Johnny again. You know, I'm not really surprised. But is that not weird? Oh, well, like my old grandma used to say have fun take chances Try things but I don't think I want to try that tour and Mexico for me Well, Cancun Playa del Carmen Yucatan vacations are great for a week or two, but that's about it for me So then what about Ecuador? Well, we spoke a little bit about it in the last few shows You know one question I often get is why have some Latin countries abandoned their currencies and adopted the US dollar like Panama

[17:36] Ecuador El Salvador and Belize it just seems so improbable you go to a country that doesn't speak English except for Belize and here they got US money That's got English printed all over it and it seems the Overwhelming majority of those questions about the US dollar are coming in about Ecuador So let's have a little history on Ecuador and why that came about. Well, we don't have to go too far back Let's talk about 1997. There was a guy President of Ecuador called Abdullah back around now not even six months into his term he was deemed mentally incompetent by the Ecuadorian Congress and Forced out of his post as president. Imagine that one legislator calling another mentally incompetent

[18:23] Talk about calling the kettle black. All right, then in 1998 and 9 there was a huge Ecuadorian banking crisis 70% of the nation's financial institutions closed their doors Unemployment was at 17% Officially, but people say it was as high as 40% and their currency called the sukre Depreciated by 200% in a single year total disaster, right? Well, you know what's been happening in Venezuela makes that look like a walk in the park But back then that caused huge economic tremors in Ecuador's economy then in the year 2000 in the wake of the collapse of the sukre Ecuador became the very first South American nation to adopt the US dollar as its currency Now at that time millions of Ecuadorians lost their entire savings in the switchover to the dollar and that year

[19:16] Jamil Mahwad was forced to step down from the presidency following a military coup led by Lucio Gutierrez Meanwhile, there were massive street protests by indigenous Ecuadorians who made up around 80% of the population or more So then after all that turmoil and unrest the people were ready for a brand new experience And that's why they voted in Rafael Correa You know, you got to give credit where credit is due and he did straighten out the country in dramatic ways He cleaned up Ecuador's public finances and did great repairs on the roads and highways in particular But no politician can stay popular forever The tide turns fast and you know now along with the neighbors Colombia Venezuela Brazil Ecuador

[20:01] all of them being hammered by the collapse of oil prices to virtually half of what they were a few years ago and Oil being Ecuador's number one export. Well trouble soon followed What you have to remember is that for a good part of Rafael Correa's term that would be from 2009 to 2014 five whole years Oil consistently traded in the eighty to a hundred dollar a barrel range however from November 2014 to now oil took a Catastrophic hit dropping far below thirty dollars a barrel at one point and now hovering around the forty to fifty dollar range Which is why all the sudden as I explained in a past show so many taxes have been legislated in Ecuador in the last year most of them aimed at high earning Ecuadorians and

[20:48] gringo expats by the way anyway For a country where oil accounts for between forty to fifty percent of all their external export earnings Needless to say they're now bloated government is in a tough spot So whatever you think of Korea as a president and he did good things when he first came in Look at the historical facts. He is an avowed socialist when times were good and well It was a hundred bucks a barrel He drastically increased all his state budgets raised taxes even in good times and hired new Public sector employees by the hundreds of thousands not to mention he presided over a massive increase in Ecuador's external debt Leaving absolutely no fallback plan for a rainy day

[21:35] except to squeeze its citizens and foreign residents by raising taxes even more and as it turns out just like all countries who are Almost totally dependent on oil for exports like Venezuela Correa of Ecuador like Hugo Chavez and Maduro of Venezuela Continuously drew up state budgets on the assumption that oil would Indefinitely continue at a hundred bucks a barrel or more and of course to please the common people and maintain permanent support He you might say recklessly ramped up public expenditures and government hiring paying absolutely no mind to the cyclic nature of the global commodities markets oil being one of the prime global commodities and The really amazing thing is and I bet only one in maybe ten thousand people knows this. He's a Ph. D

[22:25] economist a Graduate of give me a second. I got a swallow hard here the University of get this Illinois which begs the question what in the hell kind of economics are the teaching at the universities in the states? I've been away a long time. I didn't know they were cranking out PhD socialists Obviously pure Keynesian and really over the years what an idiot doofus John Maynard Keynes has proven to be remember He's the guy that invented the basic philosophy that a government could spend its way out of an economic crisis No wonder modern legislators idolize the guy, but where were we oh? Yeah? There's something strange about Raphael Correa that illustrious PhD graduate from I hate saying it

[23:11] You know where anyway throughout his multiple terms as president Correa has been pounding his fist and saying we're not gonna sell Pieces of our country to the United States or its capitalist big transnational business cronies any longer only what he's not telling you Is that all through his term? He's been selling off Ecuadorian interests to guess who the Chinese? Who've invested countless billions in the country and before Correa was an office Not a Chinese investor insight not even a real Chinese restaurant Which begs the question if you were president of a country who would you rather sell your resources off to the US or Chinese dickheads? Both pretty rotten choices if you want to maintain your sovereignty But government is a cancer that needs to be fed, and it doesn't care by whom and you know bottom line is

[24:02] Political pundits looking at Ecuador are saying if oil was still at a hundred bucks a barrel There's no doubt that Correa himself would be seeking an unprecedented fourth term But because he had to do certain things like raise taxes over and over again His popular approval rating has dropped around 40% which ain't bad But when oil was a hundred bucks a barrel it was at 85% Oh, and by the way if you've been paying attention just this week They had their first round of the election and of course Correa is not running However, he says after the final election which is coming up He'll be heading to Belgium his wife's home country To pursue a career as an economic academic Try saying that after a couple tequilas economic academic economic

[24:48] Academic by the way you got to love the names of some of the candidates running for president in Ecuador There's one guy who's in the lead right now his first name is Lenin Vladimir Ilyich not John I mean come on who outside of Russia names their kid Lenin and amongst others He's running against an Ivan another Russian throwback and a guy whose first name is You'll never believe it Washington so you've got a race with Lenin versus Washington. Could that be more stark? Yogi Berra would say deja vu all over again, right? So for those who might defend Korea because he did bring the country out of devastation You got to know this Ecuador has the highest inflation rate for all dollarized countries in the world Now I know that doesn't mean much to gringles and expats setting their sights on Ecuador as their plan B destination

[25:36] But you have to think about this even though Korea was president during the highest oil revenues in Ecuadorian history Well was not the Ecuadorian government's highest income stream The fact is it was straight blood sucking taxes that were their number one income stream in fact Ecuadorians Now have about 30 different taxes and government fees that they have to routinely pay now Remember Rafael Correa says he's a socialist and has had a socialist government which scares off brick-and-mortar Private enterprise and of course, you know, one of the fundamental principles of socialism and Korea's government is the redistribution of wealth Which history shows is only a redistribution of poverty in disguise

[26:23] In fact in a recent Argentine University study It was determined that even if the Ecuadorian government did Redistribute all the wealth of the richest people in Ecuador the top 2% The rest of the population would receive less than five US dollars each Now, of course, it's painful to find out that the average person up in the states pays over 100 government taxes and fees every year. By the way, if you doubt that I can send you the list Just pop me an email still point is when setting up your plan B You don't want to move to a country that's following in the same idiotic footsteps as the one you're trying to leave So in the end that doesn't mean I don't recommend Ecuador as a great place for expats No country is or can be perfect. They've all got their good bad, the ugly and the great

[27:09] Alright, that said if you want to get on the early bird list for my July 2017 expat insiders seminar in and around Guatemala again Send me an email the expat files at gmail.com and I'll put you on the early bird list and don't forget about expat plan B Dot-com that's where you'll find my expat essentials course. Yep. It's the next best thing to get in boots on the ground So do check it out south of the border This is the expat files living in Latin America If you want me to help you out with your own plan B Just schedule a one-on-one consult send me an email the expat files at gmail.com And if you want to learn how to move forward with your own plan B from right up there in the states go to www.xpatplanb.com and check out my three videos. See ya nos vemos