How does the state and business keep Honduras poor?

Problems of the State

Taxes and the investment in socially necessary services are impossible to acquire from local populations. The current 14% tax rate here is a dream for many and a pre WWI reality in the US. Still, there is no sewage, barely potable water, dirt streets, power outages, crime with drunken gunmen weekly killing & banging on your door for fun at midnight. The tax rate is quite low, yet the real issue remains that the rich (.5%) can provide basic services for themselves. They build high walls, hire guards, buy nice water tanks, build sewage systems to the public rivers, and generally live well. They are only 5 families of 20 people in my village of 1400. This would represent the US top 1% having most of the wealth, which is very present here. My favorite statistic is that every ex mayor or current mayor has a pool. This highlights the problem of corruption and inability for the government to legitimize taxes or provide services.

Corruption is ever present, yet aid does little to help the situation, as it goes directly to the government in large 87 million dollar projects or the USaid’s most recent project. Instead of providing the infrastructure to the US, we are providing it to Honduras, so that US companies and banana republic countries can export more efficiently. Regardless of its success, the fact that most of it stays with the government with little entering or providing the services really needed. I recognize that I probably have a bias to their talk, instead of having the ability to look at their books. Still, from the outside an elementary teacher (who works between 60-90 days a year) should not be one of two having a pool and a suburban American house. It seems like being a politician here means that you need to be in the office twice a week, work elsewhere half the time, have fun talking with other politicians about projects in lavish hotels on tax payer money. Basically, the system of aid works to the disadvantage of innovation or hard work, as the wealthiest are not those that produce or work hard, rather those that receive aid from abroad. This provides the behavioral disservice of showing corruption, nepotism, and a poor work ethic, as the road to success, impeding innovation once again.

Unfortunately, businesses expenses are very high for security, as the police largely cannot provide much of a service, minus clearing out drunks and reducing open affronts of the laws, not drug related. As Honduras posts a 98% success rate of getting away with murders, imagine the success of theft or minor offenses, or rape etc. This requires that my coffee coop employees 10 people, of which 7 are security guards. This means half of the monthly salary or more goes to pay for security. I admit that cameras or dogs may be better, yet these all assume that the police would come, if the dog barks, alarm from cameras sounds etc. The police go home at 9pm and come back at 6am. It also is not likely to be able to do much with a very limited education & capacity to solve crime.

Poverty is a lovely circle of distrust and blind running to keep from dying or starving. There is no time to think of improving the quality of something, as quantity and force are essentials of work. Your work is only valued in quantity of coffee, not in quality of picking. Your quantity of hours is paid, rather than amount of grants written, pages, checks filed correctly, or other measurable means. Instead it is just that your body was present in the office, or carrying sacks or doing something routine, not the efficiency or quality of that work. Also quality of the product is not important whether looking at coffee, cattle, carrying bags, clothes, or food. Rather the root producing for the price offered without thought on a means to improve the quality is the norm. The idea of quality is only beginning to be understood, yet really few know what quality means. Most think that it is a product that the seller is proud of, which means every seller is proud of his product yelling louder than any other in the market. Yet no one recognizes that it is subjective, and not the seller, but the buyer’s opinion. They have a real disconnect with the idea of quality being objective to someone buying it, instead of what one says or sales spiel. While the move from quantity to quality should be something that is simply a conscious change in production, it is entirely against the market of producing as quickly, with the most energy and effort expended, without regard to a means to reduce expenses or improve the client’s opinion of the product. This could be that most clients are so far away or the local clients do not have the money to bid up better quality, so that the effort in making quality is not recognized in the local market, and the international market is not in direct contact with the local producer unaware of value added quality control or its earning benefits.

What do you feel about limited government or what taxes are unnecessary in your opinion?

Does this represent a future for the US or is it just the past?

The food quality is finally taking hold in the US, will the quality of other products follow?

Please leave comments or questions, as well as any insight into means to improve this on the ground!