
Don’t lie to me, Argentina. Imagine a world without statistics - wslh
http://www.economist.com/node/21548242
======
rubyrescue
i just hired someone (developer) from INDEC. It turns out that they pay their
people "en negro" - that means the official inflation group for the country
doesn't pay their taxes - they hand cash to their employees and don't report
it - or report a small amount and pay a lot more 'under the table'. Yet there
are advertisements (paid by the government) all over the buses in Buenos Aires
that say "Trabajo mejor cuando mi trabajo es en blanco" - I work better when
my work is "in white" - in other words, when my employer pays the proper
official taxes.

The level of hypocrisy in this country is staggering.

~~~
pvarangot
This is a well spread practice in the federal government around here, since
you've been in Argentina for many years by now I'm surprised you've just found
out.

The government is the biggest "en negro" employer of the country. It's also
the biggest hirer of workers under precarious conditions such as fixed time
contracts. Ironically, one of the biggest "en negro"-hiring branches of the
federal government is the Labour Ministry. I suppose you're also not surprised
by this, since you must already know the government to be the biggest
everything in Argentina :P

Hiring "en negro" or under precarious conditions is not only terrible because
of tax evading, in this case they would only be cheating themselves. It mainly
sucks to be employed that way because you loose (or its harder for you to
enforce on your employer) most of the labor benefits you usually get when you
are employed by someone here. In Argentina that means no social security,
health plan, granted days of leave to study for exams, extra money on
holidays, bonus 13th month salary, increasing days for vacations when employed
for more than 5/10 years, etc... the list is in fact pretty extensive.

~~~
vegardx
Just out of curiosity, are you afraid that what's happening in Greece right
now also will happen in Argentina? With pay raise to avoid internal conflicts
and benefits beyond this planet, I see an impending doom.

Is it also possible that Argentina has been on it about Falkland Islands
lately, because the government also see the impending economic doom and need
something to blame it on / shift focus?

Very much speculation from my part, as my knowledge of Argentina is about as
much as a famous footballer, but it would be interesting to get your thoughts
on it!

~~~
smackay
There is a window of opportunity opening up for Argentina regarding the
Falkland Islands on the diplomatic front and militarily too. With the Cold War
safely out of the way the interests of the United States lie more with good
relations with their South American neighbours than with their older (perhaps
former) allies in Europe. Argentina's push on the diplomatic front, presenting
themselves as the agreived party is likely to gain a lot more traction than it
did in the 1980s. On the military side the UK is unlikely to have a credible
aircraft carrier capability for at least another 10 years, if ever. If the
airbase on the islands could be neutralized then the chances of creating
another Task Force to liberate the islands once more are very slim indeed.

~~~
forgottenpaswrd
I don't know what you are smoking or drinking but I want some.

I had been living in Argentina for a year(I'm Spanish with family there), and
something more in UK. Argentina could not compete in a war against UK, period.

The industrial base is so overwhelming in favor of UK that Argentina has not
an option.(industry is what supports war, not soja). If they need it, they
could create whatever planes they need, including US drones.

The people in Europe is disciplined, Argentina is a chaos, everything is
disorganized, the UK army is fighting wars with US as a partner right now,
they are so much better trained in real combat.

UK has nuclear weapons, Argentina do not. UK needs Falkland as a base for the
Antarctic continent, and fishing.

UK situation is stable(with all the crisis, crisis in Europe is "normal' in
Argentina).

UK is not a fried of the USA, it is the father of the USA. They could have
problems from time to time but when when push comes to shove they are
relatives.

USA is not going to tolerate an invasion of Falkland(whatever the Argentinians
feel about Maldivas as their own). They don't want conflicts.

~~~
moomin
Hear hear. Besides which, the UK actually has the moral high ground here.
There's no native population yearning to break free of the British yoke here.
What there is is a self-governing democracy with large country next door
intent on enforcing territorial claims that were murky when they last occupied
the place 200 years ago.

------
toyg
It would be nice if the Economist also recognised a lot of other official
statistics from all over the world are routinely faked or "massaged",
especially when it comes to inflation and unemployment levels. Some European
countries experienced very high inflation rates almost overnight when the
common currency was introduced, up to 100% in some areas, but 15 years later
official figures are only just starting to recognise that. The definition of
unemployment in most countries is basically "tweaked" every time a general
election is looming. Hell, even rating agencies have lost faith in most
official sources, and are now pulling ratings out of their (probably gold-
plated) ass most of the time.

The Argentinian government is just guilty of being a bad liar in a sea of very
slick liars.

~~~
ahi
The Economist has its own biases. Argentina gets picked on because they aren't
on the same team.

------
llopatin
Another fact not mentioned, is that Argentina's government pressured McDonalds
to lie on the price of the Big Mac as to appear lower on the chart of the
Economist's Big Mac Index (<http://www.economist.com/node/21542808>).

The Big Mac combo in Argentina is AR$21.50 (approx USD$4.90) and the next
cheapest combo is around USD$8.50.

~~~
pvarangot
Another funny fact is that one of the USD 8.50 combos is the "Triple Mac",
which is basically a Big Mac featuring yer another slice of meat on top of the
lowest one. One can build his own "Triple Mac" for arround USD 7 by buying a
Big Mac and another hamburger.

Also FYI no official information about the government really regulating the
Big Mac price is available... only rumors. Both the government and McDonalds
deny theiy have engaged in talks regarding the Big Mac price, McDondalds
alludes they are only segmenting the market to allure to cheapskates and the
lower substrates of the market. I'm not defending the government here, only
telling what I found out.

~~~
wslh
Well nobody recorded the conversation... But what I just realized this week
directly is that I can't find certain very important medications because the
same minister (Moreno) stopped importation of foreign elements. So... if he
stopped critical imports related to health I can only think that the big mac
story is real.

Also, Mc Donalds will be harmed if they recognize it, this is the reality.

------
narrator
On a related note, Hong Kong produced no economic statistics on purpose for
many years.

>Cowperthwaite was similarly opposed to five-year development plans, noting
that revenues to offset expenses were not predictable. The publication of
official statistics was curtailed, for fear that it would encourage civil
servants to meddle.

<http://www.economist.com/node/16591088>

~~~
heelhook
I'll take no statistics over doctored statistics any time.

------
pyman
Menem, the former president, was jailed for selling arms to Croatia. After
that his wife left him for not investigating the death of his son, who was
killed by the drug cartel. He built a clandestine airport in Anillaco (his
home town) which he used to smuggle arms and drugs. Menem, today, is a
National Senator, the airport is still open and the government dropped all
charges against him, including: corruption, illegal enrichment and arms
smuggling.

People are willing to tolerate this, that's why the country is doomed.

------
squeed
Check out the comments in that article. Am I the only one who stops listening
when the Economist is accused of conspiracy?

Sure, they have certain biases which are pretty easy to spot, but accusing
them of being an American mouthpiece seems way off the mark.

~~~
wslh
The Argentinian government has an army of "social media soldiers". They are
very easy to spot, if you read something completely irrational it's a "social
media soldier" work or some kind of blind government fundamentalist.

~~~
frankydp
The instant red herring responses on any comment is pretty blatant. Not that I
assume it is government but it does seem pretty systematic.

------
uvdiv
The most disgusting part is where the Argentine government censors private
analysis/journalism of economic statistics:

 _"In an extraordinary abuse of power by a democratic government, independent
economists have been forced to stop publishing their own estimates of
inflation by fines and threats of prosecution."_

To be fair, even the European Commission drafted something similar in the
height of the financial crisis, when they considered "regulating" credit
ratings agencies (e.g. telling them what ratings they could and could not
issue on sovereign debt).

<http://www.economist.com/node/21538142>

~~~
Confusion
There's quite a difference between proposing something and retracting it or
having it shot down in a general vote vs. actually getting it ratified and
enforced.

------
martincmartin
Why the bias towards official figures? In other words, for other countries
where unofficial figures are better than official ones, why not use those? Why
do the official figures have to be so glaringly, grossly wrong before they
report unofficial ones?

~~~
wslh
Answering in this context: because Argentina had a good statistics institute
that was destroyed by three governments. So now you are paying people for
lying in your face.

And speaking generically not all countries have a private sector that can
afford country wide statistics research.

~~~
aortega
It was not destroyed. Some clever guy realized that people automatically trust
statistics and you can fake them. Locally, INDEC lost all credibility years
ago. The Economist just realized it, next time they will realize the "big mac"
index is also totally useless here. Meanwhile people are having 25% raises _in
dollars_ every year, meaning that temporally we have a lot of money, until all
business go broke, that is.

~~~
RobertKohr
I don't know, the big mac index does a fairly good job at being an independent
measure of inflation (and by a company that isn't trying to manipulate the
price to hide inflation).

Big mac's goal is to measure currency exchange rates, which I think is a
little wonky since county to country a big mac doesn't work out so well, and I
wish the used it to focus more on inflation.

------
GFischer
Argentina is also taking a lot of other extreme measures to combat inflation
and flight of capital, like not printing money, leading to a shortage of coins
for example; and severe restrictions on exchanging pesos for dollars, hurting
tourists and imports. Newspapers even report the paralell exchange rates!

I suspect there will be an economic crisis in the next few years, and it will
hurt us Uruguayans as usual, we're already feeling the pain of export
restrictions and now they want to restrict services and software which will
direcly affect several friends and colleagues.

~~~
Jebus
Would you mind explaining the downvote? I friggin live here and I KNOW they
are printing more money than ever.

Their modus operandi is basically this:

\- Take money from the middle class through unconstitutional high tax rates
(that never come back in the form of infrastructure, education, security,
etc), so they become poor.

\- Give money to the poor so they keep voting favorably

\- Give money to already rich friends and the Congress members, to have more
power

\- Get crazy laws approved, so that middle class has no escape. Eg: We can no
longer buy other currencies, not even gold, so we are forced to stick to the
pesos.

\- Print print print! (more pesos) This way the money flows like this:
people's savings and salaries -> government

\- Profit

~~~
loboman
They are printing a lot of money, but they are not printing $ 400 or $ 500
bills, that is what we need. About 50% of the bills in the street are $100
bills, which doesn't make sense. Printing bills with a higher denomination
would be a way to officially declare that there is, indeed, inflation.

Source: [http://www.losandes.com.ar/notas/2011/7/6/mitad-billetes-
cir...](http://www.losandes.com.ar/notas/2011/7/6/mitad-billetes-
circulan-100-579146.asp)

ps. I didn't downvote you; I don't think it matters anyway

------
Fargren
The common officialist argument, for whatever it's worth, is that publishing
the real values would induce panic and further inflation. Basically, they
claim that it would be irresponsible to disclose the real values.

~~~
mc32
But don't they realize that then this gets baked-in in people's expectations.
I.e. when they say 5% people know to adjust accordingly and think, oh 10%, and
so on.

Short term this might work, but long-term (year or more) it becomes useless.

~~~
tatsuke95
Much of modern macroeconomics revolves around the theory of expectations.

<http://en.wikipedia.org/wiki/Rational_expectations>

So, one way to diminish the crippling effects of inflation is to lie and say
there is none. Of course, as you say, in the long run you'll get hammered, as
people's expectations fly out of whack and they are required to guestimate
future rates of inflation.

~~~
wisty
According to modern macroeconomics, people are omniscient, and will see past
fake statistics. Also, recessions can't be predicted, because everyone is
smart enough to prevent them.

~~~
adrianscott
"People are omniscient" -- one of several false assumptions that lead to
unrealistic results from the theories (and disaster/losses to
banks/investors/govt's who base their actions on them)

~~~
erichocean
He was being sarcastic.

------
tokenadult
Seeing this thread brought to mind the brief article "Don’t Cry For Argentina"
by Paul Krugman last year,

[http://krugman.blogs.nytimes.com/2011/06/23/dont-cry-for-
arg...](http://krugman.blogs.nytimes.com/2011/06/23/dont-cry-for-argentina/)

and I'd be very curious to find out what HN participants who are familiar with
Argentina (I am not) think are appropriate lessons to take for other countries
from the economic experience of Argentina.

~~~
wslh
Obviously this is just one opinion from an Argentinian but I think there are
only two lessons. The other economic analysis (GDP growth) are explained
because the country came from a really strong recession (subzero situation),
and the commodities rocketed sky-high while the agricultural sector improved a
lot in terms of efficiency. The rest of things remains the same: an hyper-
corrupt country, without justice (except when the government pushes for
specific cases), with a lot of poor people and people living of social
assistance handled by government lords in change of favors (votes).

Lessons for other countries:

\- You can renegotiate your foreign obligations (what is happening in Greece).
The default is not the end of the game.

\- Stay away from IMF bureaucrats

------
aortega
Inflation and economic disaster is the norm in the latest 30 years of this
country. I believe this government is saying "fuck this, we might as well try
something new before everything crash". I believe they actually succeeded in
delaying the inevitable crash. All the world economy is crashing anyway.

~~~
roderik
Wut? Argentina had 10 years of recesion, with actual deflation. Inflation is
not the norm in the last 30 years.

~~~
marianoguerra
that's because at that time the goverment tied the peso value to the dollar by
law.

<http://en.wikipedia.org/wiki/Argentine_Currency_Board>

~~~
roderik
yes

------
colonel_panic
Why now? It doesn't escape my notice that an influential British magazine is
majorly dissing the Argentine government just as Britain and Argentina are
getting into another tiff over the Falklands and a bunch of oil is found
there.

~~~
wslh
What matters is the truth here beyond who says it.

------
Jebus
Can't wait to leave this country. I'm sorry for the honest people who don't
have an option. I'm going to Uruguay or Brazil. =)

~~~
roderik
And why we should care about that? Please guys...

~~~
roderik
Sorry, I didnt mean to be harsh. I wanted to point that your comment is not
actually relevant to the topic, and its distracting. Good luck!

------
roderik
Well, they are blind trusting the privates right? The comments here have not
many data supporting the arguments. "I live here" is not good enough, ever
heard about antropological fallacy?

~~~
wslh
What do you mean? Please explain.

~~~
roderik
There is no "citation needed" meme. There is two metrics (or many, one from
the .gov and the others from private analysts) and everybody repeats that one
is wrong without explaining why. I have no interest in defending the .ar
goverment, but this article is not really good. They should say something like
"this another metric or method should be used, these are the correct
parameters, because of a, b, and c. The ones used by the Argentinian gov are
wrong because of d, e, and f". Also remember that the index is not an absolute
number, it is relative to certain parameters. Saying that "15%" is low or high
just like that is absurd, its like saying that a distance of "10" is too large
without referring to a scale. OTOH, the argument usually exposed is also
wrong, it reads like: "The people buying every day in the local store knows
that inflation is higher." Thats a fallacy, the only thing I can know from
going to the store is the price from that store. An index cant be used for
predictions directly. I would like to repeat that I have no sympathy with
.gov.ar, I think they do many things wrong. Sadly, those things are not the
ones pointed by the media. I am interested in changing the status quo but,
imho, the only democratic, honest way to do it is using rationality as a tool
for making our best possible decisions.

~~~
wslh
I think you are really joking... it is not just two metrics, and you really
don't know about what your are talking about.

It is the reality that we see everyday. Salaries increases ~4x since 2001,
yogurt in the supermarket increases 6x.

~~~
roderik
I dont understand why do you react like that. I am not joking. Read carefuly.
My salary increased more than 4x, but that doesnt prove you wrong right?
Statistics doenst work that way. Sorry if I offended you by having a different
opinion, but ad hominem arguments like yours are not going to improve things,
we should try to actually think.

~~~
wslh
You are being irrational, it is extremely easy to compare supermarket prices
from 2003 to prices on 2012.

~~~
roderik
Yes, of course, but that doesnt prove anything about INDEC. The index does not
measure the changes in that way. Please, dont call me "irrational", it clearly
doesnt apply, I think that I have a reasonable argument that of course can be
wrong, but by any means is irrational. Please tellme how do you go from this
premise: "The prices in the supermarket raised" to "Indec is a lier". My
argument is that it cant be "Because yogurth increased 300% and Indec
inflation report is 10%". We need something better to prove they are wrong
(and let me repeat _again_ that I think they are wrong)

~~~
wslh
Sorry Roderik, I am beginning to think that you are part of a new Turing test.

~~~
roderik
Well, you keep talking about me instead about the topic,and I dont understand
why you are disrespectful with my person. I will go back to reading on Logic,
mi topic for this week. I got "Metalogic" from Hunter. Really, sorry for the
noise.

