Economics With A Face

Now the central bank has no control over the currency in circulation, but surprisingly they are still a functioning bureaucracy. They now are trying to get involved with cultural projects for the country to in an effort to preserve the thousands of jobs that are no longer needed. It also leaves a window open to return the sucre into circulation.

One issue that I questioned them about was the price hikes that most people we talk to complain about after the dollarization. I plan on writing a bit more about this at a latter date, but in essence this was partially a product of the governments inflationary policies making their way through the system after the dollar was frozen with the sucre.

We talked about a variety of other topics: Alvaro Vargas Llosa, current events in Ecuadorian politics, the number of presidents that have occupied the office in the last few years, the current absence of a supreme court, and much more. On topic that they were currently focusing on was banking laws that had just been passed in Congress. They were fighting hard to get information out on just how bad these laws were for the country. For example, any foreign bank who wanted to operate in the country will have to have a huge portions of their reserves located in Ecuador. Here is a link to one of their recent essays on the topic.

The Ampueros invited us to lunch in their home where we talked more about everything from economics to our families. During lunch they received a call from their son who lives in Florida who wanted to let them know he had made it through the hurricane safe and sound, although he was still without power and it was an extremely rough storm.

When I brought up how much I enjoyed seeing George Reisman’s book in their library Dora pulled down a picture of her, George Reisman, and Tibor Machan together at a conference in Alabama. I took a picture of it to put on our site.

After lunch we headed back to the library to talk with Roberto, Joselo, and Meche, all employees of IEEP. They were all our age and it was a great talking with them about how they got involved with the institute and the progress that was being made. After another hour or two we decided to head back to our hotel. When we left Dora was taking an online class that had to do with her dissertation. The professor was located in Argentina and there were about 20 other students in the class from across Latin America.

Back at hotel walked down to the Malecon and had dinner at one of the many restaurants. Afterwards we continued walking up the sea-side walkway, past a photograph exhibit from the national archive and all the way up to a lighthouse atop a hill that overlooked the city. Everything from the restaurants to the walkway was new and immaculate. It was also extremely safe with policemen visible every 50 to 100 meters. Dora would later tell me this restoration project was almost entirely financed by charitable donations people could write off against their taxable income. It definitely added to the charm of Guayaquil, formerly a rough and dangerous port town.