What I’ve Been Reading: Friday, 1 June

I’m sitting in a hotel lobby in Montevideo where an elderly uruguayo is playing the piano: it’s all very civilized. I came for a conference run by CADAL on the business climate in Latin America, but I’ll write about that another day. For now, there’s a new city to be explored and a bus to catch this afternoon – I’m heading to Maldonado tonight and Punta del Este tomorrow – so I’ll limit myself to a roundup post.

Foreign Policy’s A Giant Among Giants profiles Glencore, the enormous commodities firm few had ever heard of until its IPO in May 2011. It was founded by Marc Rich, “a defiant friend of dictators and spies who later became one of the world’s richest fugitives” (until his controversial pardon by Bill Clinton). The business culture seems highly toxic and corrupt, its firm’s connection more than a little suspicious. Still, I thought the final quote was interesting:

[L]ike all good businesses, even Glencore has to keep up with the times. Marc Rich seems to agree. “Discretion is an important factor of success in the commodity business,” he told an interviewerwhen Glencore announced it would go public. “They probably don’t have a choice. Transparency is requested today. It limits your activity, to be sure, but it’s just a new strategy to which they have to adapt.”

Is there really much sense sitting around wringing our hands over poor corporate behaviour? Business as a rule operates according to the profit motive, in the context that is provided. It’s up to society at large to put the limits on this behaviour. If we don’t put down the limits, should we be surprised at the results? Well-thought out and sensible regulation – and a society-wide demande for ethical products and services – won’t kill capitalism: it’ll find a way to adapt.

Nevertheless it is terrifying to think of the money and power wielded by commodities firms – those that control the raw materials we need for, like, everything.

Still on the business theme, The Nation’s The Rise of Benefit Corporations is a brief introduction to a new corporate form that has been written into law in certain American states. I haven’t had a chance to read a whole lot about these benefit corporations but I find the idea compelling if a little utopian.

As one of those people guilty of using the developing world label without the quotation marks I read and was shamed by Jay Ulfelder’s post There are two kinds of countries in the world: ___ and ___It’s an interesting debate. On the one hand, any meaningful analysis needs to draw on some method of grouping and classifying the things under discussion. On the other, each classification system we use draws on certain assumptions and determinations of “value”. I like to think I use the developing country tag well aware of the inherent problems with it, but by doing so am I perpetuating the unfair judgements it draws on?

The New Yorker published a profile on William Alexander Morgan, The Yankee Comandante. I had no idea he existed. This is a great read, and an illustration of that tragic moment in which the beautiful dream of the Cuban Revolution began to fall apart.

We’re experiencing ever stricter dollar controls in Argentina: it breaks my heart to withdraw pesos from my bank account in US dollars – ATMs no longer offer the option to withdraw in dollars – at the official rate of around 4.4 when the “blue dollar” is going for 5 pesos and up. (The blue dollar is the black market dollar. I don’t know why its called blue either). I have considered withdrawing dollars here in Uruguay and smuggling them back into Argentina in my underwear but dollar-sniffing dogs are likely to be at the border, and I can’t really criticise the Latin American propensity to bend the law and then smuggle dollars myself. The Economist summarises here.

I will spare you links to the reports on Australian Government budget transparency, the subject of most of my reading this week as I prepare a report on the topic for work. That’s OK. You can thank me on twitter.


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