Jim´s Journey

My address in Peru is: Jr. Eulogio Del Rio 1079 Huaraz, Ancash 02001 Peru. My cell phone number is 51-939684153.

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Location: Huaraz, Ancash, Peru

Tuesday, September 26, 2006

Unfettered Capitalism

Ever wonder what capitalism would look like if you took away the worker protections imposed by governments like minimum wages, hours worked, age discrimination, and things like that? It would probably look a lot like what you find here in Peru, because none of those protections are enforced. The minimum wage is officially about US $140 per month, but people commonly earn as little as $80 a month working six days a week. And if they complain about it, they simply lose their job to someone else who is eager to have any job at all. If they miss a day of work for whatever reason, they´re often charged two days of pay. In other words, not only do they not get paid for that day, but they pay their employer a day´s wages for the inconvenience that he suffered.

There´s officially a work limit of 40 hours per week with extra compensation for overtime, but in practice you work for as many hours as your employer tells you to. And forget about overtime. You´re lucky if you get paid for all the hours that you work. My friend Freddy has quit his job twice because his employer kept delaying payment of what he was owed. But each time he has eventually gone back, without receiving all the pay he was entitled to, because it´s the only job he can find that he knows will provide some income every week.

If you´re over 30 years old and don´t hold a ¨permanent¨ job in the profession that you studied for, forget about ever finding one. There are plenty of younger unemployed people who don´t yet have families, willing to work for lower wages. I´ve had lots of interesting conversations with taxi drivers who used to work in industry or taught in the universities, but can´t find anyone who wants to hire them because of their age.

In Peru (like most other Latin American countries), capital rules. If you don´t have an excess of money, it´s almost impossible to join the small club of people who do. The rich families continue to get richer, and the poor continue to increase in numbers. According to the measures that capitalists like to use, Peru has one of the ¨healthiest¨ economies in the world, with a growth rate exceeding 5% for five years in a row. But during those five years the poverty rate has barely changed, and still hovers at around 50%.

The other day I heard a woman say that she would like to have a small business selling tamales, but didn´t have the capital to do it. She wasn´t talking about the money necessary to rent a space or to buy equipment. She meant that she couldn´t gather together the $20 or so that she would need to buy a large pot and enough ingredients to make a big batch of tamales in her home, so that she could go and sell them on the street.

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