Living On

Armen is heavily missed. His absence left a hole in independent observation of the political and economic risk situation in Latin America. Beyond the merely analytical though his work was wide-ranging from Armenian philanthropy and social observation of Latin and European lifestyles through to being a "fly on the wall" at the Cannes Film Festival every year and reporting back on the more exotic foibles of the international jet-set.

We miss his wit, his sense of history and his bon mots (in French, Armenian and, even, Turkish). Armen was very much a product of the Levant but then, like so many other Levantines, converted to an international stage where they offer insight into all around them. This record tries to humbly accumulate his collected writings for public consumption so they can be preserved and appreciated for the urgency of the moment in which they were written to the timelessness of the observations.

How best to categorise the uncategorisable? Maybe Armen could be described as an Armenian/Anglo/Franco Samuel Pepys for our times.....

It is ironic that ultimately it was the very mediocrity and self-satisfaction of the Chilean "system", which he documented so thoroughly, that brought about his tragic end.

Wednesday, February 27, 2008

RETROSPECTIVE Further Thoughts, Comments & Reactions to Papers

From time to time, it is good to look back at what one has said and written, the context in which it developed, reactions, comments and consequences. Here are a number of selected highlights.

SANTO TOMAS I have to open this paper with the by now well-publicised case of Gerardo Rocha, founder and president of the Santo Tomas educational institutions, who last week suffered severe burns after organising and taking part in the premeditated murder of an old man who supposedly was involved with his current partner.

In my over 37 years working career as an analyst, few things if any have given me as much pleasure for shouting: "I TOLD YOU SO" about the demise of that fake psychopath. We Levantines have a special flair to weed out such characters, and in my case I also learned about crooks and psychopaths in Chile the hard way since my arrival. Having been conned by nephews of ministers and various associations of retired government and military circles, and living opposite a psychopath who for some reason is untouchable to justice, I have the exact temperature of the place.

About Rocha and Santo Tomas, I had other sources too, and for the past
decade have been warning in writing and orally about staying away from
him and all his works. Vox Clamanti in Deserto. Mr Rocha was the
plague everyone loved to be infected by. The educational authorities
gave him permission to open a university when he himself does not have
a proper high education degree (as far as I know, that is illegal). He
was called as witness to congressional committees, was a co-founder of
the Chilean chapter of Transparency (that figures…), a director of
chambers of commerce. He made a point of cornering visiting
personalities for ceremonies at his university, with the active
complicity of most of the diplomatic corps (who hide away their
visiting ministers and admirals from others who give them free weekly
advice, but are ready to involve them with crooks and
murderers..bravo!!). The only person with whom he was correctly
photographed was his fellow "desgraciado" Mr Jose Maria Aznar. Nothing
was sacred. Though his institution is named after a father of the
Church whose achievements included insulting Islam, he negotiated an
agreement with Morocco to open a seat of learning there (Morocco's
king, in case you did not know, is called Mohammed).

The Mercurio of last Saturday made a point of adding salt to the wound
by showing him photographed in company of the heads of Investigaciones
& Carabineros, the two highest law-enforcement officers in the land,
and with senate president Eduardo Frei on a trip to Asia. I am sure
there must be a photograph of him with Mrs. Bachelet somewhere.
Peripatetic (pathetic?) senator Nelson Avila has risen in his defence,
also involving fellow senator Fernando Flores in his support.

He hedged his bets on the Right too, getting close to the Opus Dei
(despite his dissolute private life), got involved with Joaquim Lavin
in his populist Banigualdad project, and got both CORFO and La Tercera
owner Alvaro Saieh to invest in his ventures (among other

There is hardly a Chilean or foreign institution based here not
affected by what is certainly the biggest scandal I have witnessed
since I arrived in Chile. It is interesting to see that several people
are using negation (most of them falsely), to claim they had nothing
to do with him. Others are in psychological denial, still insisting
that he is a "good man" and that he could never have done such a
thing. La Nacion referred to him as the former "tsar of education". I
think he was in fact the Raspoutine.

Already, some crucial evidence the investigators were about to seize
has been "stolen" from the car of Rocha's brother (what the hell it
was doing there, nobody bothered to ask). With so many powerful people
in his circles, two things can happen. Either he will die in hospital
with some help (a la Eduardo Frei senior), or he will survive and be
acquitted by the country's corrupt legal system under the excuse of
"temporary mental disorder". Hell, they might even organise a
"rehabilitation dinner" (desagravio) for him at Casapiedra (other
Chilean crooks and murderers have been so honoured).

There is another bent educational institution based in Chile, the SEK
Internacional, which runs schools and universities both here and
abroad. Its style and approach is different, but the character is the
same. You have been warned (again).

TOURISM Just after I sent out my update on travel and tourism in
Chile, someone wrote to El Mercurio telling of his experiences in
accompanying foreigners to board a cruise ship in Valparaiso. I had
singled my local harbour as the only one decently equipped for that
purpose, but it seems that I was uncharacteristically optimistic. You
have to check-in at the terminal on one end of the harbour and then
join your ship at the other end. Another reader of my papers reminded
me of a blatant omission. Though I have referred to the matter before,
I should have mentioned again the scarcity and minute size of paper
napkins in many Chilean restaurants. You have to decide in advance
which knee or breast you wish to protect against the Bolognese sauce,
because there just ain't the surface for both. Lastly, an insider
source in the Swiss secret service (you see how well connected this
newsletter is) picked up on my mention of Lichtenstein tourists in
Chile. Apparently, some years ago, a group of tourists from
Lichtenstein came over to climb some mountains (as if they were a
scarcity where they come from). They left their hire car with all
their belongings, passports etc.. at the bottom of the mountain (how
do you say "schmuck" in Lichtenstein patois? Not an easy question to
answer because even though it has only 25,000 inhabitants, they
actually have two ethnic groups there. Most are from a Germanic tribe
called "Alemanni"- how original- and speak their dialect, but they
also have immigrants from the Swiss Valais, who speak another variety)

Anyway, whether Alemanni or Walser, our alpinists had their car stolen
with all its contents, and the Swiss embassy (which looks after the
diplomatic affairs of its small neighbour) issued them with new
passports (after searching around the office to see where they had put

SARKOZY AND SPAIN My twin assault of the present state of France and
Spain produced some interesting results. Nobody protested on my
cynicism about the sham value of Sarkozy. Events since then have
proved me 1000 % right, and my scepticism is now shared by a majority
of the French population as, in February alone, his popularity dropped
by 9 points to 38 %. The latest incident in which he gratuitously
insulted a citizen at a fair shows him like the small time "caid" from
the "bas-fonds" of Salonika that he is.

The criticism of Spain's "government by folklore" produced wider
comments, particularly as it was reproduced on a pan-European
multilingual website. There was the Catalan who really shone by
claiming his "country" was beyond criticism, because the very name
meant "country of God". I also found a blog about it among Spaniards
on a local website, which was fairly balanced between the pros and
cons (in fact the cons main criticism were some factual mistakes which
they claimed were in the text, such as which were exactly the Basque
provinces). I also received additional comments from people living or
having lived in Spain recently, who added even bigger horror stories
in terms of their experiences of the aspects I mentioned. Anyway, it
is something I had wanted to get off my chest for a long time, and now
it is done.

TRANSANTIAGO On January 19, 2007 over three weeks before the start of
Transantiago, I wrote in my paper "Civil Society & Empowerment": "The
forthcoming Transantiago coordinated public transport scheme is going
to be a disaster too". You cannot be more prescient than that. The
rest, as they say, is history. I knew that, because they were trying
to solve the wrong problem (there was nothing wrong with the routes),
were using a corrupt company (Sonda) for the computerised system, and
the whole thing was too sophisticatedly complicated for a developing
country whose population is not exactly a mass Mensa candidate.

PENSIONS My paper on the flaws of the Chilean pension system was a
great success. It was translated in Spanish and Armenian, and is on
websites on three continents. Once the dust had settled, I opened
another front by seeking out the names of the senior World Bank
officials responsible for hiring a Chilean team of consultants to
advise Armenia. I sent them a copy of my paper, also copying it to all
the various OECD officials who visited the country profusely in the
past 6 months. One World Bank official answered with a feeble defence
as to the consultant being "very experimented". He copied his own
message to other bank staff. This gave me a wider list of
destinataries when I answered with details about the real background
and value of the consultant. There was no reaction this time, but I am
sure it shook them. A somewhat sanitised version is also being
published today in a major international fortnightly insurance
newsletter based in London, of whose editorial panel I am a member.

THE EXCHANGE RATE In my constant criticism of the handling of the
peso exchange rate, I had missed out two important aspects. One I
subsequently amended, not least in a published letter in El Mercurio.
It refers to the loss in peso value of the budgetary "savings", of
which over 90 % is invested abroad in foreign currency. Calculated in
real pesos, each dollar saved abroad as of December 2006 is now worth
some 19 % less. If you had been "clever" and gotten into Euros, you
would still have lost 9 %. In Pounds sterling the loss would have been
over 18 %. I am therefore flabbergasted that the committee in charge
of managing these funds recently congratulated itself for having
obtained "a return of 10 %" in 2007. I wonder how they measure that,
or do they use the same New Age arithmetic textbook than ministerial
macroeconomic adviser Luis Felipe Cespedes (the guy who tried to
convince me that + 8.7 was a negative number)?

In a blog discussion of my letter on the Mercurio's website, someone
added the other dimension I overlooked. Those who live on remittances
sent by relatives abroad are also suffering, because in most cases the
sender cannot increase the amount remitted, to compensate for the
lower exchange rate.

ENERGY I cannot remember how many times I warned not just about
energy shortages, but the fact that the LNG plants being built (now up
to two different projects) will provide gas at a much higher price,
none of which is being disclosed to the public. It seems I was once
again erring on the side of caution. Chile is currently paying some U$
4 to 5 per million BTU to Argentina. The price of LNG is at least in
the U$ 9 to 10 range. However, due to the world supply and demand
situation, the situation could be much worse. In a late February press
interview, the chairman of the Centre for Liquified Natural Gas, which
is a producers' association, estimated that the price could be as high
as U$ 19.

As if this were not bad enough, public opinion is also being misled on
the supposed "improvement" in Argentine gas supplies this year. There
is nothing of the sort.

On the contrary. The supply situation in Argentina is getting more
critical by the day. According to Chile's minister of Agriculture, the
country is said to be experiencing the worst drought in a century, and
no rain is expected for the next 3 months (according to her at least),
and 144 municipalities have been declared in agricultural emergency.

GAGGING THE MEDIA Though the radio is still pretty open, every
single printed press organ of any importance (bar some struggling
marginal publications) have either disappeared or been gagged by
takeover in the past decade.

The government has now moved to the web-based critical press. I
mentioned sometime ago the virtual death of the website There are moves afoot to lean on the two other
remaining internet media. I suppose once they achieve that goal, Armen
Kouyoumdjian will be next. To the extent that virtually nobody backs
their support for me with concrete reciprocity (beyond the occasional
lunch or cocktail invitation, none of which pay my bills), you would
have participated in the cull.

THE VILLEGAS BOOK I bought the book "Muerte a los latinos" by
columnist and broadcaster Fernando Villegas thinking it was a
light-hearted novel on the tribulations of a Chilean post-graduate
student in Miami. It turned out to be a seminal work on the Latin
character and the psychological pillars of regional underdevelopment.
Villegas, who graduated in sociology, has written a readable textbook
worthy of being a compulsory read for many university courses. I
reproduce below (in my translation) part of a paragraph which I think
is fundamental in understanding how Latin America works (in fact, why
it does not). Published October 2007 by Random House Mondadori.

"In Latin America, speeches, words and talk in all its expressions
tend to replace action, any action. Words are not the preamble, or the
verbal agreement necessary to carry out with others any concrete task,
but in fact substitute that same goal. Words replace action. Whispered
insults replace vengeance. Promises which will never be accomplished
replace commitments. Verses of passionate poetry replace loyalty.
Complaints about what the world is doing to us take the place of moves
to change it or change ourselves.

Programmes to end poverty replace measures to overcome it. Fiery
speeches denouncing injustice take the place of whatever action is
needed to achieve justice. Calls and meetings replace real agreements
and joint action. And paradoxically, as words replace action and
reality, they end up acquiring some sort of reality."

How true. Just to give one example among thousands, and return to
something I mentioned before. On two occasions (end 2006 and 2007),
the Chilean government announced with great panache the granting of
discounts on electricity bills and the distribution of energy-saving
light bulbs to low-income families. On both occasions, as far as I can
make out from my enquiries, neither discounts nor light bulbs were
ever given. Chile used to be run by Pinochet. It is now run by

FOR FILM BUFFS It is difficult to catch quality classical films in
their original versions in Chile, but there is an unsuspected source
worth exploiting. The Chamber of Deputies' cable TV channel often
broadcasts such films to fill-in time in-between repeats of sterile
committee meetings. Last week alone I caught two classics of Soviet
cinema : Serguei Bondarchuk's The Fate of Man, and Grigori Chukhrai's
Ballad of a Soldier, both released in 1959. There are Spanish

HUEVADA DE LA SEMANA Did you know that 2008 was the International
Year of Languages? The Chilean Association of Greenhouses (actually it
has an official English name, the ANDES NURSERY ASSOCIATION or ANA)
decided to give a French flavour to a new variety of nectarines they
were launching. To start with, they formally gave the fruit a registered French name: "Magique". That was not all, they held a launch event in Paine last February 20, which they advertised with a half-page insert in El Mercurio's agricultural supplement published on February 18. In it, they described in French (well, sort of) what the fruit was like. The phrase said: "Magique, Une fruits exceptionnelle". I know that the punch line is lost on non-French speakers, but there it is. I wrote to the organisation behind the advertisement. In good Chilean fashion, they did not even bother to acknowledge.

One yearns for a campaign similar to that just started in Venezuela,
to discourage the use of foreign words and expressions in commercials
and business circles.

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