Death by Big Government: Ecuador is on the brink of collapse, says ex-pat who lived there for years

There is always something awful and tragic about watching a perfectly good ship sink. It is of course, significantly more distressing if one is on board at the time! To further imagine the captain and crew themselves … those specifically in charge of your and the ship’s well-being, were entirely responsible for the sinking … is almost inconceivable. Such is life, right now, in Ecuador, however.

(Article by Nick Vasey republished from PleaseSpikeMyDrink.com)

The purpose of this article is to document and describe the events which have transpired over the near-decade I’ve been here, as succinctly and cogently as possible, such that anyone interested will be able to understand the nature of the tragedy which has befallen Ecuador … and which has resulted in the dire conditions people are currently suffering here. Conditions which, following a very dubious recent election (which resulted in the same incompetent and corrupt party of the last decade retaining power – and which millions believe is fraudulent) … are only likely to get worse. Make no mistake, Ecuador is a bitterly divided country right now. It is in no way over-reaching, to suggest a Venezuela-style demise is now very much on the cards.

A bit of context … I’m just a lifelong (and now middle-aged) world-traveller and entrepreneur, who eventually became so disillusioned with the manifest failings, obligatory compromises, debt-requirements, and lifestyle shortcomings of the so-called “first-world” that I finally decided to permanently put significant distance between myself, and it. Basically, I wanted to remove myself from what I see as a pathological illness … the virus of so-called first-world “civilisation.” So … away I went!

The year was 2008, and Ecuador was the destination. Six weeks after relocation, the Global Financial Crisis (GFC) hit with full-force, completely paralysing the “developed” world, and upending everyone’s assumptions about how things worked (or rather, didn’t work). I felt vindicated … kind of like Steve Carell’s character in The Big Short … (a must-watch film if you’ve not yet seen it).

Meanwhile, I’d started a new real-estate business with a local partner in my adopted home in southern Ecuador, and it was going well. We had got up and running, just ahead of the curve of change which sent many North-Americans scurrying southwards. They were headed this way for many reasons, but foremost amongst them was a profound (post-GFC) disillusionment with the US, its government, its corporatocracy, and the resultant financial inability for “average folks” to maintain a reasonable lifestyle anymore (especially in retirement).

It seemed there was a newly emergent critical mass of people realising the “game” was rigged against them, and had been for some considerable time. The quest for real adventure and meaningful lifestyle change was also present in many of these ideological and financial “refugees” … and Ecuador was here and there, atop all the “big lists” by that time, as being an ideal downsizing/retirement destination.

Our real-estate consultancy was perfectly placed to receive these folks, and we dealt with many happy clients over the ensuing years … helping them navigate their way through the very murky waters which had often otherwise characterised the Ecuadorian (or Latin-American generally) real-estate scene. Life was good, and while certainly not in any danger of becoming a millionaire anytime soon, I was very happy, both in my new home, and that I could make an agreeable enough living whilst genuinely being of service to new arrivals in the region.

As many readers will know, International Living (IL) magazine played an enormous role in the numbers of folks who came streaming into Ecuador since 2008. IL ranked Ecuador as Number One in the world for many years. They wrote hugely enticing sales-pitches and hosted endless seminars about the quality of life, the prices, the beauty, and the value for money of relocating to “Paradise.” Build it and they will come … and in this case they certainly did.

As a realtor dealing mostly with foreign arrivals, I was always hugely conflicted about International Living. Yes, they were responsible for some clients we would otherwise not have received … but … because they so profoundly misrepresented Ecuador in their articles, I was often more of a “re-educator” about the realities of Ecuador, than I was a realtor. And when you burst people’s dream-bubbles, the results generally aren’t too pretty. So, because of my uncensored approach when dealing with clients, I bore the brunt of some genuine unhappiness … which was in truth, directly attributable to the dashed false expectations which IL had certainly been responsible for generating.

Anyway, I digress. The point I was keen to make is that for the most part, Ecuador was seeming to have been a very good decision, not just for me, but for many. The vast majority of those who came here were happy here (once they adjusted to the cultural and lifestyle differences – and learned some Spanish to get by). Certainly, compared to the mess most of the rest of the world was in, Ecuador was by any measure, apparently having it pretty good.

Keeping in mind that Ecuador had (up until Correa) previously suffered seven presidents in only ten years, it seemed he was really doing a stand-up job of running the country in a relatively “stable” and acceptable manner. But there was, for many, always an undercurrent of “too good to be true.” For example, he adapted the Constitution early on, to give rights to Nature, but simultaneously expanded his executive powers in other areas to an extent which made many doubters uncomfortable. People wanted to believe … but sadly, over time, it was the doubters who would ultimately be proven correct.

As near as I can pinpoint it, the “Correista worm” really started turning sometime in early 2013.

Humanity had successfully traversed “end-times-prophecies” by waking up unscathed on 22nd December 2012. Nobody I knew seemed to have ascended, and people were apparently resigned to getting on with their lives once again. Those who had bought properties and battened down the hatches in Ecuador specifically to ride out the end of the world and global collapse … zipped their previously enthusiastic end-times rhetoric, muttered darkly about “stupid Mayans,” sized up their next destinations, and put their properties back on the market for us to sell. It still amazes me that these things really happened … at times it often felt like living in a movie!

Anyway, back to the turning worm. There are many things which have contributed to the current sorry state Ecuador is in, but for the purposes of this article I will simply be relating my personal experiences and observations, as well as information gleaned from the many discussions I’ve had with local Ecuadorians and long-term-expats over time. I will also be highlighting a variety of these issues by bullet-point, with links to supporting information/articles/etc … for anyone who is interested in clicking through to an array of information they may have previously been unaware of.

At this point I’d like to make clear it is somewhat ironic (and not just a little frustrating!) that the majority of expats here in Ecuador STILL remain unaware of how bad things are (let alone how bad they may get!).

There are three main reasons for this.

1. They live in a “gringo” language and culture bubble, insulated by wealth (and by design) … which sees them having practically no meaningful interaction with their host population. These kinds of expats typically have a moan about things like a bottle of their preferred wine having increased by $5 in price at Supermaxi. That’s about the extent of their awareness that serious unseen change is afoot … and invariably, they just “suck it up” without much further interest (or investigation). Why should they care? Still cheap, right!?
2. Most assuredly, cognitive dissonance is also playing a serious part … people who have poured themselves, their golden-years-dreams, and hundreds of thousands of dollars (or over a million in many cases!) … often against the advice of family and friends … absolutely do NOT want to face the reality that their investments and properties here are currently worth much less than they paid into them … and that their Ecuadorian “net-worth” will continue to plummet under the re-birthed Alianza-Pais administration. They may not want to admit it, but it is true nonetheless … and sooner or later, that brutal reality will be impossible for them to avoid.
3. The fact that the vast majority of foreigners here do not work at ground level in Ecuador (and therefore have no clue about what is really going on). Expats here are mostly retired, and existing on private investment income or foreign pensions, or if they are still working at all, are generating their income online, or otherwise, remotely. By my (purely anecdotal) reckoning, probably less than 5% of expats are legitimately engaged in any sort of “on the ground” business actually in Ecuador. Needless to say, if the extent of one’s governmental or municipal interactions are limited to paying water, electricity, and land-tax occasionally, one’s exposure to the cut and thrust of doing business here … and making a living here … is necessarily very limited.

As I said before, Ecuador once had some vitality and joie de vivre (in my first four or so years here). Since then however, for those paying even a modicum of attention, it has been a steady and terrifyingly noticeable decline into the depressing pit we now inhabit (even moreso since the dodgy election result).

The best way I can describe things here now, is that it’s like waking up each day with an increasingly heavier weight on one’s shoulders. It has been like that for four years already, and the knowledge there will be a continuation of the Alianza-Pais status-quo, is a crushing blow to anyone who understands what is really happening. One simply knows that even the most “ordinary” things are going to continue to be incredibly difficult to accomplish … to the point that, considering the inescapable futility, one is ultimately dissuaded from doing anything at all.

When this kind of demotivational malaise overtakes an entire country (which is certainly the case now in Ecuador) … the economic and accompanying social death-spiral probably cannot be halted. Certainly, these enormous problems now facing Ecuador cannot and will not be solved by the same “Alianza-Pais consciousness” which created them.

Read more at: PleaseSpikeMyDrink.com