Friday, March 6, 2009

RSS Now Available on Forum

For those of you who like to use RSS and feed readers, the Maya Paradise forum now offers an RSS feed. The feed contains the 10 most recent topics in the General section of the forum.

I'll post the feed right here for your convenience:

Daylight Savings Time

A friendly reminder from Maya Paradise:

Yes, it's again time for you folks in the United States to "save some daylight".

This Saturday night, actually Sunday morning at 2 AM, or any time thereafter, set your clocks one hour forward. (And get an hour less sleep)

Q150 Million for the Army

The Congress agreed to approve a national emergency measure with more than 105 votes to amend the budget and eliminate bans on the transfer of resources between different governmental entities. The Patriot Party (PP) had been opposing the measure but gave in when the measure was modified to include a contribution of Q150 million to modernize and professionalize the army. The Q150 million was taken from funds originally allocated to NGOs.

After three failed attempts in full session, legislators got the necessary votes at a meeting of the Finance Committee, chaired by Mario Taracena, which granted the motion to include the PP input to the Ministry of Defense, and offered to Libertad Democrática Renovada Q6 million allocated to the Asociación Civil Mi Dulce Refugio, for the construction and maintenance of nursing homes.

"We understood that the government needed to make this reform for the poor. In addition, it includes a contribution of Q150 million for the army, allowing you to expand the military bases in the country and meet one of the problems that most affects the population: the insecurity," said Roxana Baldetti, head of the PP caucus.

The Ministry of Defense has a budget this year of Q1.207 billion, which is now augmented by the Q150 million.

"We call for the surrender [of the funds] to the army, because people no longer trust the National Civil Police, and instead are clamoring for the institution that will ensure security," argued the legislator.

Now the president may reduce or transfer the resources of the Ministries of Communications and Culture, the National Fund for Peace, List of Geographical Works and any program to public safety. All these budgets amount to over Q18 billion.

Government Promises to Graduate 4,800 Police Officers

Presidential authorities recently opened the new extension of the Academy of the National Civil Police (PNC), in San Juan Sacatepéquez, which by the end of the year will fulfill the goal of adding 4,800 officers to the national police force.

The academic complex is located next to the Polytechnic School. Construction cost Q7.9 million and was financed with state revenues and international cooperation.

"Public taxes are invested here to obtain security in the future. We want police officers with a community dimension," said Marlene White, director of the PNC to the students of the Academy.

Salvador Gándara, Minister of Interior, stated that this extension to the academy enables 1,000 men and 250 women to be trained and graduate within 10 months.

"Today begins a new era within the PNC, we are committed to this promotion so that these people leave within 10 months respecting the dignity of Guatemalans," said Gándara.

Last Wednesday, the Department of State issued a report on human rights in Guatemala, which highlights corruption in the PNC. Moreover, it referred to the 19,671 members of the PNC that are not trained.

President Alvaro Colom announced that construction begins next week on the National Institute for Strategic Security.

Used Car Importers Denounce New Law

Importers of used vehicles are claiming that the new "first registration tax" law being discussed in Congress could cause the loss of thousands of jobs and the country's middle class to lose its ability to purchase cars. According to the Unions of Used Car Importers, the final price would rise considerably if the tax is approved.

The bill sets the tax rate at 26 percent per vehicle, according to the table that the Superintendency of Tax Administration (SAT) would develop once the legislation is adopted.

Alejandro Barrera, president of the union, said the used car business generates employment for about 800,000 people across the country who could lose their jobs. He explained that the law would not only affect importers but the whole chain involved in the process, from the company from which it is imported from the United States, to customs, business sales of tires, spare parts, automotive paint and upholstery, among others.

"In the midst of this economic crisis, this law would endanger the viability of many businesses," said group vice president, Francisco Giron.

Export Economies Hit by Drop in U.S. Consumer Spending

It was reported by the U.S. Commerce Department a couple of days ago that the savings rate in the U.S. has risen to its highest level in 14 years. This is a sea change, possibly with big consequences, since a large part of the global economy has long depended on uncontrollable consumption of Americans.

The loss in value of homes and the collapse of investments and retirement plans has caused a dramatic change in U.S. consumer behavior and the consequences are being felt from Taipei to Berlin.

This last January, Americans in the United States saved 5 percent of their income, the highest percentage since 1995. As recently as April of last year, the savings rate was zero.

If the savings rate of 5 percent per year continues, then spending by Americans will drop by $545 billion.

Many analysts predict that the savings rate will continue to rise. Some believe it will return to the 9 percent level that was seen in 1980.

Consumer spending in the U.S. has undergone a "gigantic" drop according to Rebeca Grynspan, director of the Latin American and Caribbean Program of the United Nations Development Program (UNDP).

The World Bank says that for the first time in 25 years, worldwide economic activity has dropped. It fell by 2.1 percent, mainly due to decreased consumption by the United States.

Carlo Cottarelli, head of the fiscal affairs department of the IMF believes that "it is necessary that consumers put their accounts in order" in the United States. For years they lived beyond their means, thanks to abundant credit, whose ultimate origin was Asian, which were happy to extend credit to the United States. They got into debt to buy more powerful cars, bigger houses, travel to the Caribbean, relying on "incredible" stock market gains and real estate capital gains, said Barry Bosworth, an expert at Brookings Institution.

The fall of these assets has now destroyed $8 trillion, leaving the poorest families struggling to pay debts.

"I do not expect a return to the mentality of crazy spending in the U.S. in the medium term," said Gary Hufbauer, an expert of the Institute for International Economics.

Eswar Prasad, a professor at Cornell University, said that the export-based economies "will be forced to think about rebalancing their growth and generating domestic demand in order to end the crisis."

That's just what they are doing in China and Germany, they are employing fiscal stimulus packages.

Asian governments have announced a fiscal expansion of nearly $700 billion, comparable to the U.S..

Meanwhile, for United States citizens the sudden restraint involves immediate pain because it implies a drop in consumption. However, it is beneficial in the long term by ending behaviors that were unsustainable.