Episode Summary
In this episode of The Expat Files, Johnny Mueller dives into the political corruption that plagues Latin America, the dangers of public transportation, and the challenges expats face when living in the region. From the scale of corruption to the risks of riding a bus, this episode offers a comprehensive look at the realities of expat life in Latin America.
Johnny begins by discussing the prevalence of political corruption in Latin America, highlighting how politicians often transition from being common citizens to corrupt leaders. He uses a joke about a poor farmer who becomes a president and is asked about having a million dollars, revealing that he already has it, as a metaphor for how politicians in Latin America often amass wealth through illicit means. Mueller contrasts this with the first world, where political corruption exists but is less extreme. He emphasizes that in Latin America, the scale of corruption is so vast that it often goes unnoticed until years later, when investigations or whistleblowers expose massive thefts. He also notes that in the first world, even small financial misdeeds can lead to significant consequences, but in Latin America, the scale of corruption is so large that it's almost beyond comprehension.
The segment then moves to the recurring pattern of high-level politicians in Latin America who are implicated in corruption, often being re-elected or appointed to new positions despite being convicted or facing charges. He highlights examples from Guatemala, Costa Rica, and Panama, noting that stolen money frequently ends up in the hands of family members. He also touches on the broader issue of how politicians maintain power through vote-buying and the lack of oversight in international aid, which enables further corruption. The segment ends with a discussion on the increasing frequency of bus bombings in Latin America, which are often used as a form of extortion rather than for material gain.
Next, Johnny discusses the dangers and peculiarities of public transportation in Latin America, focusing on buses and drivers. He highlights the economic reasons why people rely on buses despite the risks, noting that fares are significantly cheaper than in the first world. He also delves into the broader issues of driver behavior, the lack of enforcement of traffic laws, and the ease with which one can obtain a driver's license through bribery. The segment emphasizes the leniency of the legal system regarding driving violations and the potential for fines to accumulate against vehicle owners, even if the driver is not the owner. Johnny warns expats about the risks of allowing others to use their vehicles in these countries.
The podcast segment then discusses the dangerous and often reckless behavior of Latin American bus drivers, highlighting the lack of accountability and the systemic issues within the public transportation system. He provides statistics on the number of bus drivers murdered in Guatemala and contrasts this with the relatively low number of such incidents in the first world. He also discusses the unsafe conditions of public buses, including overcrowding and the drivers' tendency to cut off other vehicles. Johnny explains that bus drivers operate on commission, which incentivizes them to maximize fares by overloading buses and driving recklessly. He further notes that in the event of an accident, drivers often flee the scene due to their status as independent contractors, and the legal and financial consequences for them are severe. Despite the presence of insurance, the compensation for victims is often minimal.
Johnny then discusses the lack of substantial payouts for victims of bus accidents in Latin America, using the example of a bus crash in Quito, Ecuador, where families received only about $2,000 per deceased person. He contrasts this with the more luxurious private bus options, which are safer and more reliable. He then shifts focus to the issue of extortion in public transportation, particularly in Guatemala, where bus owners are subjected to monthly protection money payments. Johnny highlights the scale of this extortion racket, estimating that $4 million is collected monthly in Guatemala City alone, and suggests that the government and police are complicit in these activities. He concludes by comparing the bus extortion racket to a much larger one involving small businesses, which pay monthly extortion money to local criminals.
In the final segment, Johnny discusses the challenges of public transportation in Latin America, emphasizing that large cities face significant issues like extortion, while smaller towns are less affected due to self-policing. He highlights the difficulty of solving such large-scale problems and critiques expats' tendency to view these issues through a first-world lens, proposing solutions like hiring armed guards on buses. However, he also notes that Latin American bureaucracy often complicates even simple solutions. The segment ends with a call to action for listeners to visit the website for more information and a sign-off.
Topics
Political corruption in Latin America, Contrast between Latin American and first world corruption, Scale of corruption in Latin America, Whistleblowers and investigations in political corruption, Corruption in Latin American politics, Vote-buying and political patronage, International aid and its misuse, Bus bombings as a form of extortion, Public transportation in Latin America, Economic factors influencing transportation choices, Driver behavior and safety, Legal system and enforcement in Latin America
Chapters
00:00:00 Opening 00:01:06 The Farmer Who Became a President: A Metaphor for Political Corruption in Latin America 00:01:57 The Scale of Corruption in Latin America: A Comparison with the First World 00:02:40 The Reality of Political Corruption in Latin America: A Criminal Class of Politicians 00:05:21 Politicians Resurface After Corruption Charges 00:05:32 Guatemalan Ex-President in Jail for Theft 00:07:21 How Politicians Maintain Power Through Vote-Buying 00:09:20 Bus Bombings as a Form of Extortion in Latin America 00:10:42 Introduction to Bus Travel in Latin America 00:10:48 The Appeal of Bus Travel Despite Risks 00:11:20 Economic Factors Driving Bus Usage 00:11:52 Cost Comparison Between Latin America and First World 00:12:18 Quality and Safety Concerns of Buses 00:12:51 Obtaining Driver's Licenses Through Bribery 00:13:46 Lack of Point System for Driver's Licenses 00:14:45 Fines and Legal Loopholes for Vehicle Owners 00:15:41 The Reputation of Latin American Bus Drivers 00:15:50 The Tragic Statistic of Bus Driver Murders in Guatemala 00:16:37 The Driving Habits and Motivations of Latin American Bus Drivers 00:17:08 The Unsafe Conditions of Public Buses in Latin America 00:17:43 The Legal and Financial Consequences for Bus Drivers in Accidents 00:20:24 Insurance and Compensation for Victims of Bus Accidents 00:20:38 Average Payouts for Bus Accident Victims in Latin America 00:20:59 The Extortion Racket in Public Transportation 00:23:01 The Scale of Extortion in Guatemala City 00:24:10 Connection Between Extortionists and Government Officials 00:25:04 The Larger Extortion Racket Involving Small Businesses 00:25:32 Introduction to the Problem of Large Cities in Latin America 00:25:34 Clarifying the Scope of the Issue 00:25:38 Contrasting Large Cities and Small Towns 00:25:40 Self-Policing in Small Towns 00:25:43 Lynchings and Previous Discussions 00:25:48 Encouraging Listeners to Download Previous Episodes 00:25:57 The Challenge of Solving Large-Scale Extortion 00:26:02 Expats' First-World Perspective on Local Issues
Transcript
Automatically transcribed from the original recording; names and wording may contain errors.
[00:10] Hi everybody, I'm Johnny Mueller, and you're listening to The Expat Files, living in Latin America, the one of a kind show that tells you what it's like to live, work, play, and or retire in Latin America. So let's get started. On today's show, we'll be talking about Latin American politicians, why they have a license to steal, where they get the money, from the first world of course, and how they get away with it. And then, we'll give you 101 reasons why you should never ride a public bus. And we'll talk about the ins and outs of a booming career path, the extortion racket. And now by popular demand, I've been asked to tell yet another Latin American joke that's
[00:57] going around, and I'll translate it of course into English. So here's one that's going around Nicaragua right now, and it has a pointed political bent. So here it is. A long time ago in Nicaragua, there was a dirt poor farmer who lived in a tin shack. Now this guy had the gift of the game, so he decided to run for a local political office. And to his surprise, he won a small time position with ease, and he gained popularity quickly. And over time he worked his way through a lot of mid-level political positions until he finally ran for president. And being a man of the people, he won that contest too. And on the day of his inauguration, a young reporter came up to him and asked him a question off the record. He said, Mr. President, what would a man like you, a common man, a man of the people, do if you had a million dollars of your own?
[01:43] And the president laughed and turned to him and he said, young man, off the record, you don't know much about politics, do you? I already have a million dollars. OK, that's the joke, and it's really not funny, because it's pretty much taken for granted that the way to become rich in Latin America is to go into politics. Now I know what you're probably thinking, in the first world it's pretty much the same way. I mean, what guy up in high-level politics in the first world is not filthy rich? I mean, it takes millions to run a statewide campaign, and in a federal campaign it takes tens of millions. We all know that. But no matter how much of that goes on in the first world, or how much corruption in politics that you think you've seen, you haven't seen anything until you've seen what they do in Latin America. The politicians down here are in fact a criminal class through and through.
[02:33] You just can't imagine how many congressmen, presidents, vice presidents, and cabinet members have been indicted and put in jail. In fact, at this very moment, there are over 250 high-level Latin American politicians – I'm talking about congressmen and ex-presidents and vice presidents – and they're under indictment right now and on the run from the law. And in 99% of those cases, it takes some years after the politician's been out of office or retired before some kind of unrelated investigation turns up some kind of massive theft or fraud on their part. Because basically, nobody's watching the hen house. And what seems to happen in a lot of cases is that some years go by and the politician is well out of office, and a whistleblower comes forward trying to save his own skin, and he exposes some massive fraud that happened a while ago and since he's been caught with
[03:23] his hand in the tail, he wants immunity and the way to get that is to finger the big boys some of the politicians that he was involved with. And let me tell you, these scams are not small. It's not like in the United States or Europe where the occasional big news is some politician forced to resign for accepting let's say a gift under the table of $10,000. Or maybe he patted his expense account or took his girlfriend on a junket to Rio de Janeiro at taxpayers expense. Even with those light-handed offenses, first world politicians often don't survive the fallout. It seems that in Europe anyway, the only thing the politicians get a pass on is a sex scandal. But if it has to do with money, even a few thousand dollars, they're out on their ear. I mean really, how many times have you opened up a New Yorker, a Chicago, or a San Francisco
[04:09] paper and there's a picture of some disgraced politician who'd somehow pilfered 10 grand out of somebody's cookie jar. Now in the first world, that's a career killing scandal. But you should pick up a Latin newspaper sometime and see what kind of career killing scandals they have. I don't know about you, but it comes as a big shock to an expat when he finally learns enough Spanish to read the newspaper and he sees how thoroughly corrupt the politicians really are. In most cases, the money they're talking about is beyond comprehension. All you have to do is scan the first three or four pages of any Latin newspaper. Any day of the week, you'll see that there's at least a dozen ongoing scandals that are so huge that they make the Nixon Watergate crimes look like some kid who stole a dollar
[04:54] from his mother's purse. I won't go into specific numbers here because your eyes will just glaze over. But the amounts of money we're talking about, the money stolen in pilfered from government coffers, the numbers are so ridiculously out of proportion for the size of these small countries that you can't imagine how these political thieves keep getting away with it year after year. And what's even more surreal is the fact that when these huge amounts of money are stolen, the politician or politicians who have been fingered for stealing often resurface in a few years only to be re-elected or appointed to a new high-level government post. In fact, in Guatemala right now, there's an ex-president and an ex-vice president in jail right now awaiting a trial for the theft of more than $100 million.
[05:41] And most of the money ended up being transferred into European bank accounts of his ex-wife, wife and daughters. Pretty clever, huh? And there's another ex-president in exile in Panama that won't return to face charges for the millions he stole. Then there's an ex-Costa Rican president, the son of a Nobel Prize winner, that was involved in a $5 million theft from a social fund who's now living in Switzerland and won't return to face charges. Oh, and I forgot to mention that Guatemalan president that's in jail right now, the one that transferred all those millions to his relatives in Europe, well, he was convicted of two counts of murder in Mexico during his college days, and he still got elected. Then again, Hugo Chavez did a couple years in prison, and he got elected. I could go on and on for hours about the state of politics, especially high-level politics,
[06:30] and the terribly substandard qualifications these guys have for office, but I don't want to depress you any more than I have to. Now, with all these scoundrels holding high political office, a reasonable question an ex-pat always asks, especially when he starts reading Latin newspapers in Spanish, and only then does it really sink in how much money's constantly stolen. Reading things like that day in and day out always make ex-pats wonder. I mean, how high-level politicians get convicted, go to jail, get a 5 or 10 or 20-year sentence, and suddenly another judge comes along, commutes his sentence, and in a few years, he's back in the political spotlight again, somehow completely whitewashed. And it's amazing that four, five, maybe eight years later, his same band of crooked cronies
[07:16] are back in office again. Well, the answer to how they get back in office is easy. When you look at the fact that 50 percent or more of the Latin American population lives on $2 or less a day, politicians discovered a long time ago that they can buy each and every one of their votes dirt cheap. And the traditional way to do it was to hire hundreds of buses on election day, and then promise each and every one of these poor campesinos a free box lunch if he gets on the bus and goes to the polls. And when they hand that poor farmer or street sweeper a box lunch, they make sure he knows what political party gave him that free meal. Well, if these cheap giveaway tactics remind you of old-time Chicago politics, then you know your history. But to me, and a lot of expats, the big question is not how they steal the money.
[08:04] That's easy to see. That is, if you know anything about Latin American accounting principles, or lack thereof. The question is, where did all that money come from? Now, you can be sure it's not all from tax revenues, because tax revenues, as a rule, in Latin America are very low on a per capita basis. In fact, half of the population works off the books, so they don't even get revenues from them. Well, the answer is quite simple. When you have the World Bank, the International Monetary Fund, and a host of United Nations agencies funding project after project in the Third World, with little or no oversight, and quite unimpressive results, and add to that all the First World countries that donate huge monetary packages every year to Third World countries. I'm talking about Taiwan, Japan, Australia, France, Germany, you name a First World country,
[08:54] and they've got 101 different programs that donate huge amounts of cash and material to the Third World. And along with those monetary packages come rules, but very few of those First World donors have the manpower or do the necessary oversight to keep tabs on any one of those projects. And that's why, when an expat picks up a Latin American paper, and reads that some First World country, like South Korea, has just donated 16 million dollars for an infrastructure project in Honduras, or Belgium has just donated 100 brand new Toyota pickup trucks to a Salvadorian inner city crime unit, well all an expat can do is shake his head and wonder how much is going to get stolen. It just seems like First World donors never learn. As if expats needed another reason not to ride public transportation in Latin America,
[09:45] here's one for you. Well this is reason number, well I've lost track of the numbers actually. But anyway, lately bands of extortionists throughout Latin America have not only been robbing bus passengers, but now the new tactics are to occasionally blow up a bus, and usually when it's packed with people. The latest public bus bombing occurred in Guatemala just a few days ago, and as I report this the death toll stands at 9 and counting. And you don't want to be caught in the middle of that now do you? The question is, why would anybody even want to blow up one of those buses? In most cases the buses themselves aren't worth the powder to blow them up. So what's up with that? I mean buses like that are filled to the brim with impoverished masses, and there's practically nothing of value worth stealing.
[10:31] If you really analyzed it, the most a thief could get would be maybe some fake gold jewelry and some cheap cell phones. That is except for the occasional tourist or expat who's wedged in with the masses, and they're only on the bus because they read about the experience in folders or Lonely Planet. And like those ubiquitous guidebooks always say, a chicken bus ride is not to be missed. Boy are they wrong. But back to this latest bus bombing incident. Let me give you the lowdown on a certain kind of common crime that takes place in Latin America. It's like this. The highly organized bands of criminals don't much like stealing from the common people on buses. There's just not much to get. People who ride the buses ride them because they're on the bottom rung of society.
[11:18] That means most riders are pretty much broke. And since buses are dirt cheap, that and walking are the only ways to get around. Now I don't know what it costs to ride a bus in the United States, let's say in New York or Chicago. Personally, I haven't taken a bus in years and years, but I do remember as a kid, taking a bus would cost me maybe 25 to 50 cents. I'm sure by now it's got to be at least a few dollars up in the first world. And last year when I was in London, it cost me about three dollars for the average bus fare. Well, it might surprise you, but the cost of bus fare throughout Latin America is about 10% of what it is in the first world. And that's why it's so popular. And though it might be dangerous, the public's overriding concern is economic. For example, in San Jose, Costa Rica, it'll cost you maybe 30 cents to go all the way
[12:06] across town. Of course, compared to the first world, there's a big difference in the quality and the comfort of the ride. And if you've been listening to any of the past expat shows, you know that throughout Latin America not only are the buses substandard, stinky, badly maintained and dirty, the bus drivers themselves can be outright maniacs. They not only don't respect the other drivers on the road, they don't even know the rules of the road. And in so many cases, it's impossible to see how they ever got a license. Though now I'll tell you something else you never knew. In most countries in Latin America, driver's license can be had two different ways. One, by going down and taking the test, and two, by paying off a lawyer or someone in government.
[12:52] In fact, the outright buying of a license has been such a way of life for so long in Latin America that nobody really thinks twice about it. Though thankfully, with the advent of computers, these days things in that department are changing. But I can tell you this, any day of the week I can go to a big Latin American city, head down to where congress and the municipal buildings are, and in the masses of people huddling on the street, there'll always be someone down there ready and willing to sell you a driver's license that'll pass muster with any traffic cop. And that's because I've yet to meet a single traffic cop in Latin America, in any country, who has a computerized system in his patrol car. I'm talking about a system that actually functions now. And that means he doesn't really have the capacity to see if a license is real or valid.
[13:38] And it really wouldn't help if they had a system like that anyway. Because like I said before in a previous expat show, Latin American countries do not have a point system for their driver's licenses. In other words, you never lose points for driving violations, even drunken driving. I know that sounds almost impossible to believe. And if certain bad drivers in the first world ever found out about this, well it's just possible that this kind of news could start an expat stampede. Because like I said, no one ever loses their driving privileges, nor do they ever get their driver's licenses revoked. So the expiration date on your license is the only thing the police have to go by. And if your license is actually expired, they just write you a ticket and you're obliged to pay a small fine. And even in that case, the police won't take your license or stop you from driving.
[14:27] And you can imagine, when an expat first sees this system in action, he can hardly believe his eyes. It's got to be one of the most lenient systems in the world. It's a system in which nobody really ever loses their license. But I can tell you this, if you're not careful, a lot of little fines can pile up. But due to another strangely Latin American loophole, the fines only pile up for the owner of the vehicle. In other words, if you're caught speeding or driving the wrong way down a one-way street, the traffic ticket will be made out in your name, but the fine goes against the owner of the vehicle. And that means if the fine is not paid, the next time the owner goes down to renew his license plates, he'll have to pay those back fines and charges before they'll issue him a new license plate sticker.
[15:13] So expats, a note of caution here, it's not a good idea to let your neighbor, your gardener, or your maintenance man use your car. Because you could be in for an unpleasant surprise. So let's get back to talking about public buses and their drivers. Well if you think you've seen some crazy drivers in the States, you haven't seen nothing yet. Because in Latin America, it seems like it's a requirement for a bus driver to be unhinged. In fact, to have a death wish. The fact is, nobody likes bus drivers. And they've got such a bad reputation that the op-ed pages in the newspapers are just full of bad stories about them. And here's an astounding statistic for you. Last year, 2010, in Guatemala, 130 bus drivers were murdered and everyone was killed during some kind of robbery on a bus.
[16:00] And yet there's not much clamor about 130 bus drivers getting murdered in their own buses. Okay, that's 130 bus drivers murdered in a country of only 14 million. Now let's compare that with the first world. What about first world bus drivers murdered in their own buses? If you do a Google search on that, you'll find that last year there were a few bus drivers who were shot or stabbed in their buses by unstable people who got into arguments with bus drivers over things like transfers. But I can't find a single case of a bus driver murdered in his own bus during a robbery. But back to Latin American bus drivers. They just love the tailgate and they're always in a hurry because they get paid on commission. A few send tobbles for every person they pick up. So they'll do anything to get ahead.
[16:46] And they'll pass you on a blind corner. They'll cut you right off on an exit ramp. They'll blast their horn a few times and as a final insult, blow a huge cloud of black smoke in your face. And as a group, Latin American bus drivers have the worst driving and safety records of any collected group of monitored drivers. And if you don't believe that, just look in any of the Latin American newspapers. Every year, dozens of bus drivers flip their buses completely over with full loads of people. Wait a minute, did I say with a full load of people? I take that back. I don't mean a full load of people. I meant to say a massively unsafe overload of people, especially at rush hour. People are packed in so tight they're hanging out the doors and windows. In fact, it's not unusual for the average Latin American public bus to carry twice the
[17:37] number of people it was designed for. And no one's counting and nobody's checking. That's just the way it is. Because public bus drivers generally operate on commission, which means they get a small basic salary and a little piece of every fare on board. So naturally, it's their duty to pack them in like sardines. And just as an aside, I'd like to mention that usually when there's a bus accident, it's pretty severe. When a bus flips or goes down into a ravine, one or more people almost always die. And I don't know if it's dumb luck or what, but 9 times out of 10, the bus driver survives. Now here's a bit of news you've never heard up in the first world press, so pay attention. When there's an accident that involves a bus, an accident that's bigger than a fender bender, when for sure someone's been hurt or killed, it's been estimated that more than 80% of
[18:27] the bus drivers will make a run for it and flee the scene of the accident, and most are never heard from again. Yeah, you heard me right, the driver runs. Now you're probably thinking, this guy's a public employee, he's driving a public bus, so the Department of Transportation surely has a really good file on him. Photos and fingerprints and references and family data. Not to mention he's got to have a valid driver's license, and everything that goes along with that. And you're thinking with all that stuff on file, what a dumb move, he'll never get away with that. But you'd be wrong. Because here's the catch. In most countries in Latin America, the public transportation department farms out individual bus lines to private businesses. In other words, if you or me had a dozen crappy buses,
[19:14] we could bid on a bus line when the contract comes up. I mean, if the contract ever comes up, because most of those deals are sweetheart deals, done under the table by politicians and insiders. So anyway, if you get the contract, the government doesn't know or care about who's actually driving the buses, or what kind of safety records or histories they have. They only care that the bus routes are covered. So why do Latin American bus drivers drive like maniacs on speed, risking their own lives and everyone else in the bus? Well, it's because they're on commission, and the faster they go, the more paying fares they can pick up. And what happens when there's a crash and someone's injured or killed? The bus driver almost always flees because he's signed on with his company
[19:59] as an independent contractor. He signed some legal paperwork that he probably doesn't understand that makes him completely responsible for the passengers in the bus. And bus drivers know if anyone on their bus gets injured or dies, it's the driver who's going to jail and for a long, long time. And what happens when somebody actually does get severely injured or even dies in a bus accident? What kind of compensation do they get? Well, even in the third world, there's insurance coverage. And there is compensation for the victims. For a company to even get a bus contract, they're required to carry a certain amount of liability coverage just in case of accidents like that. So now I'm going to ask you, what do you think is the average payout when someone's killed in a bus accident? What do you think the family gets? A million? A half million?
[20:46] You might expect those kinds of amounts with a public utility accident in the first world, because first world payouts are usually based on lifetime earnings and pain and suffering. Well, let me tell you right now, you can forget about a first world style payout. But as far as actual damages go, well, in one case in August of last year in Quito, Ecuador, a bus crashed and killed 38 people. And what was the average insurance payout to the families of the deceased? Just about $2,000 a person, which is about a year's salary for the average Ecuadorian. Yet another reason for expats in Latin America not to ride the bus. But just remember that here I'm talking about government sponsored public transportation, not private. Things are completely different and much more first world when you talk about private tour buses and private coach lines.
[21:34] You know the ones I'm talking about, those sleek double decker models, the ones that give you all the luxuries like bathrooms, snacks and pirated first run movies. And there's tons of services like that throughout Latin America. And sometimes it's the only alternative for people with a little extra money and who don't want to drive a car themselves. But let's get back to that Guatemalan bus bomb. Why would anyone want to blow up a bus full of people who are pretty much broke? Why would somebody do that? It seems so self-defeating. That is unless someone's trying to make a point. And they are. Because you see in Latin America, the public transportation extortion racket has been kicked up a notch. What I mean is the organized bands of extortionists have long ago stopped robbing the individual people on the buses.
[22:21] When individuals get robbed on the bus, and they do all the time, it's a one-on-one crime done by a penny any thief to steal a cell phone or a purse. But the really big racket and where the money is, is in charging monthly protection money to the individual owners of these private bus lines. Does that sound familiar? It's like Tony Soprano and his boys in their protection rackets. Remember how he'd send a bag man around every month to the local businesses? Protection money, right? And if somebody missed a payment, he got his legs broken or his building torched. And in Latin America, the bus gets blown up. So just how big is this extortion business? Well, in Guatemala City, it's been reported that for only five bus routes, $150,000 a month is collected in extortion fees.
[23:10] And that's almost $2 million a year for just five routes. And in Guatemala City, with 2 million people, the news reports say that organized extortionists collect $4 million a month from the bus owners alone. And that's about $50 million a year. And lately, the bus owners have been further pressured by the extortionists for higher payouts. They want to milk the cow a little harder and are demanding higher percentage on the revenues. And some of the owners got together and tried to resist the increase. Now, they weren't complaining about the regular protection money, just the increases. Anyway, that's when the bus bombings started. And I'm giving you this example from Guatemala because it's the most recent. But the same thing is happening throughout Latin America. All you have to do is Google bus bombings in Latin America
[23:58] and you'll see exactly what I'm talking about. So are the Latin governments or the police doing anything about it? Well, if we take the Guatemala case again, which is all over the news, local journalists and analysts have been saying for some time that the extortionists themselves are connected with people high up in government and in the country's banking system. Because there'd be no way to move $4 million a month through a banking system without throwing up a million red flags. Especially since Guatemala and all Latin American countries now, they have their own equivalent of the Know Your Client law. So now, doing banking and cash in the third world is pretty much like doing banking with cash in the first world. If you deposit more than $3,000 at a time, you have to fill out all kind of banking forms.
[24:44] Now they make you show where that money came from and you have to prove that it wasn't obtained illegally. And remember now, that's $50 million in extortion money that somehow needs to be laundered to the banking system. And that's just to take for the bus extortion racket. And that's just the tip of the iceberg. Because what most first world people could never imagine, is that there's another extortion racket that dwarfs this one. One that's been estimated to produce 100 times more cash than a bus racket. I'm talking about the monthly extortion payouts to organize crime that nearly every small business pays to their local extortionist. And that means if you have any kind of small establishment in the big city, paying extortion money is just the price of doing business. That doesn't apply to smaller towns though.
[25:32] And I'm emphasizing the big city here. I'm talking about any city over 100,000. Smaller towns almost never have this problem. And one of the reasons is that small towns are self-policing and they lynch people, which I talked about in a previous expat show. So you might want to go to the home page at progressiveradionetwork.com and download it from the expat file archives. It's an eye-opener. So when you have extortion on such a grand scale, how do you solve a problem like that? Now I've said this many times before, that when expats come down to Latin America, they see things with first world eyes. They see simple, easy solutions to problems that sometimes the Latins just don't see. And when expats get together, they talk about such things.
[26:18] Like what would I do if I was in charge? If I were king for a day? Like for example, how about if the bus companies, instead of paying extortion money to the criminals, what if they took some of that money, installed cameras on their buses, and hire one armed guard for each of the bus lines? Now I don't know about you, but for me, if there's a policeman sitting on a bus, I'd feel pretty safe and secure, as long as he was in there with me. Even if in Latin America, policemen only need a sixth grade education to get the job. When a guy's got a gun and he's dressed in a policeman's uniform, he gets some automatic respect. And nobody's really thinking about his qualifications. But that still doesn't mean I'd ever ride the bus, unless I absolutely had to. But it would mean a lot for everyone else who does.
[27:04] But that'd be way too simple, putting a policeman on each bus. And if I've learned one thing, living in Latin America all these years as an expat, Latin bureaucrats complicate things 10 times worse than any first world bureaucrat ever did. They don't like simple in Latin America. They never did. Especially in government. So what's the expat files recommendation about taking public transportation in Latin America? Well if you haven't figured it out by now, you're a lost cause. You've been listening to The Expat Files, living in Latin America. A one-of-a-kind show produced and compiled deep in the heart of Latin America. And of course you can always email me with any of your questions about Latin America.
[27:52] expatfiles at progressiveradionetwork.com See you next time. Los vamos.