Archive for the ‘Ancient wisdom’ Category

EntrepreneurshipEntrepreneurship is living a few years of your life like most people won’t, so that you can spend the rest of your life like most people can’t.

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And not just the election rhetoric!

Trash collectors in Chile have been on strike. It started in Valparaiso and spread to Santiago. Over the past week the trash has been piling up and getting out of hand. Ever street corner has a mini mountain like this one.

Smells just as bad as it looks.

Smells just as bad as it looks.

The same crap happens in Uruguay every year around Christmastime and the opening of high season, as the trash men there try to make it as inconvenient as they possibly can in the hopes they get a pay raise. Here, the strike comes right before the presidential elections, either in the hope that the current president gives them a generous parting gift of higher wages (not likely) or, more likely, it is all an orchestrated event banking that Michelle Bachelet, the new more left-leaning president they hope to elect, uses it as an opportunity to give lip service not only to the socialist cause but also uses it to look magnanimous and problem-solver-esque. Because she dropped the ball on all the other initiatives she did in her last term, like FUBAR’ing public transportation and FUBAR’ing the post-quake reconstruction.

ExpatBob’s infinite wisdom is as follows (and this worked in Curitiba, Brazil, by the way): Fire all the garbage collectors and post a reward per bag of trash brought to the dump. Every square inch of Santiago will be spotless within a few days, will remain so for the forseeable future, and there will never be garbage strikes ever again.

 

If you spend any time in Latin America, you will find that things happen with a bizarre, backwards-zero-sum lack of logic that makes your head spin. Part of understanding this has to do with understanding the Viveza Criolla and its influence on the way the people think.

The Viveza Criolla, also shortened to “Vivo” is a behavioral phenomenon in Spanish-speaking, Latin-based cultures, whereby an individual tries to screw someone else over before his victim has a chance to do the same to the perpetrator. They brush off the guilt by saying, “Si no robo yo, robará otro (If I don’t steal from you, someone else will),” as if you should thank them for the privilege of being robbed by someone you know!

It is their way of forcing a zero-sum outcome to snag it away from the other guy before he even has a chance. It has become a way that society rigs outcomes in favor of schemers and shysters, and punishes the honest. It is to blame for the tiring plague of ingrained lack of trust, the penchant for socialist nonsense, and the laziness, lack of work ethic, and disdain for self-starters and those who wish to excel.

There is no literal translation for Viveza Criolla that fits, and the best a local has ever come up with to explain it to me is to describe it as a “Wiseguy” mentality. Some describe it as “artful lying.”

The term Vivo can be used as a noun for the act itself, or as the formal title of its perpetrator. The Vivo is viewed by its winner as, well, a way to get ahead. The Vivo is viewed by bystanders as a “good for him,” one-up street cred for the winner. The Vivo is seen by the loser as a part of life, and a learning opportunity not to be repeated (so he is more apt to pull the Vivo on someone else before the Vivo is pulled on him).

The Vivo, when caught, is a sort of wink-wink-nudge-nudge situation that is treated with an “oh, haha, you got me!” attitude, whereby both the victim and bystanders are expected to catch it first; if they fail to counter-Vivo, they are expected to take blame for losing because they were not sharp enough to see it coming. It is a bizarre backhanded outsourcing of responsibility.

Regardless of the result, the dynamic of the Viveza Criolla places more importance on getting away with the heist, than the actual fruits of the labor.

In the Vivo game mechanic, the instigator of the Vivo has nothing to lose, and is, in fact, strangely one-upped for being caught (you charming devil)! The loser, if he catches it, is also one-upped for catching the instigator. However if the instigator does not get caught, he is one-upped while the loser is one-downed. Heads I win, Tails you lose. It is, quite literally, nonzero game mechanics turned inside out.

And no, the bystanders will not necessarily warn the victim of his impending fall to the Vivo, for it is his responsibility and his alone to see it. After the fact, oh yes, they will all come by and say “Oh, yeah, we knew about that but we didn’t want to seem nosy.” Which flies in the face of Latino culture because they are the most inherently gossipy bunch of people I have ever encountered.

If the victim is lucky, someone might pull him aside and say something like, “Ojo, es muy vivo ese (Watch out, that guy is very untrustworthy).”

The Viveza Criolla is a negative, destructive cancer upon the social and economic fabric of Latin America, and one of the reasons the region cannot seem to pull head from ass and get its act together. It is the reason why Latin Americans do not trust each other, and, as the Peruvians are apt to say, “Your own hand cannot even trust what the other one is doing.” It is the reason for short-term profit taking with complete disregard to future business prospects, and lack of customer service.

This trust issue is not just between buyer and seller; it can happen with any agreement, from simply getting together for lunch, to major property deals, to selling a car, to employing someone, etc. To keep it elementary I will just describe the parties as “buyer” and “seller.”

Often times the seller, after making an agreement, will pull the Vivo and actually sabotage the deal, thinking that he is getting undercut somehow by the buyer, after they have already settled on the details of the deal. Thus, when some are negotiating prices (for real estate in particular), the seller jumps the gun on the Vivo, thinking he can get a better deal because “hey, there’s interest shown in this thing, that means I am not asking enough!” Counteroffers then come back to the buyer higher than the original asking price!

Often times the seller will simply kill the deal because he gets too nervous, thinking that smooth sailing means the worst, and that he will get really screwed in the end. It’s almost as if they cannot contemplate a square deal at all.

Sometimes the buyer, despite wanting what it is that he is after, will sabotage the deal after the fact because he thinks that it is too good to be true. Or something about the seller makes him question the quality of the merchandise. Both parties will analyze and re-analyze every little interaction until they have made themselves paranoid. This is why there is no such thing as customer service in Latin America. You are expected to deal with it if the seller fails to provide, because after all, it is your responsibility if you got stuck with the wrong end of the Vivo.

Another aspect which the Vivo invades is employment and contracted relationships. The roundabout Vivo thinking will invade the mind so much that if a mistake is made, the party at fault will feel the need to blame the wronged party and create extra drama around the whole situation whereby the one at fault will attempt to shift the blame and make themselves appear the victim. “I am being exploited! How dare you demand I show up at 9 and work until 5?! How dare you hold me accountable when I say I will be here tomorrow and I don’t show up until next week!”

Thieves, when caught, will become angry and try to turn the situation around, claiming “faltándole el respeto,” that you are disrespecting them, as if they deserve any.

The Vivo thinking is a source of much of the “Mañanismo” (tomorrowism) that has killed the work ethic, since it provides an excuse for them not to do anything. Why, they will be exploited for sure– better to screw the boss over first, before he can exploit the workers!

It’s very hard to explain, and I have tried my best, but there it is. You will encounter it if you venture into Latin America, so watch for it; maybe you can see it coming, maneuver it to your advantage, and get Vivo street cred for cutting it off at the pass.

Special thanks to BeelzeBob for helping me to understand 🙂

 

PS. The book is at 85 pages and counting…

I wrote this for part of my book but I figured it’s stuff that everyone ought to know so… enjoy!

The Foreign Earned Income Exclusion, or FEIE, is a benefit which excludes an amount from your taxable gross income. At the time of writing, for 2013, it gives you an exemption of $97,600.00 per person, provided that you meet certain requirements. And, in addition (yes, there is actually an “in addition”) you can also exclude or deduct certain amounts for the Foreign Housing Exclusion (FHE).

The FEIE is applied based on days abroad, so the total amount is divided by 365 and then multiplied by the number of days you were gone. So, for tax year 2013, $267.40 per person, per day, of your gross income can be tax-exempt by simply living in a foreign country.

According to the IRS website, you qualify for the FEIE if you are:

  • A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,
  • A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or
  • A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

And, for that “in addition” part about housing, you may also deduct many of your housing expenses. Whether you may exclude or deduct depends on whether or not you are self-employed; the difference between exclusion (making a portion nontaxable) and deduction (removing from taxable income) is fuzzy at best, and it’s magical mystery voodoo best left to your accountant.

The basics, in the IRS’ own words: “Housing expenses include your reasonable expenses actually paid or incurred for housing in a foreign country for you and (if they lived with you) for your spouse and dependents. Housing expenses do not include expenses that are lavish or extravagant under the circumstances, the cost of buying property, purchased furniture or accessories, and improvements and other expenses that increase the value or appreciably prolong the life of your property.”

This means, in plain English, that you may deduct the following from your gross income:

  • If housing is provided by your employer, its fair rental value.
  • Rent.
  • Utility bills, with exception to telephone.
  • Cost of any repairs.
  • Property or renter’s insurance.
  • Any nonrefundable fees for securing leasehold.
  • Any nondeductible occupancy taxes.
  • Parking fees.
  • Furniture and appliance rental.

And, in addition to that, if, for example, you are working overseas while your family remains back home, you may also apply the second household’s similar expenses to the FHE.

Real estate investment tax advantage:

If you are an employee of your own business, and that business purchases a property abroad and houses you in it, you may then use the FHE to deduct its fair market rental value and general upkeep from your personal gross income.

The business may also write off the purchase as a legitimate expense, and may also be able to write off its depreciation and other expenses that do not fall under the personal FHE. What a deal!

Corporate stipend tax advantage:

Your employer may issue a tax-deductible, per-diem stipend to you, the employee, to help with the pains of living abroad. This may or may not be tax-advantageous depending on the circumstances but may help to pad up your FEIE if you do not earn $97k by taking it from the business and putting it under your income.

Further information can be found on the IRS website (http://www.irs.gov) and the FEIE and FHE may be filed in your tax return using Form 2555.

Words of wisdom

Posted: August 9, 2013 in Ancient wisdom

From SwingdanceBob:

I really think the key to being happy is realistic expectations.  Which, most of the time, means lowered expectations.  Which, for you, means lower productivity.
So, pick any two:  productive, happy, expat.  You can’t be all three.  At least not all in the same time frame.

Liberals, Progressives, Democrats, Socialists, Communists, pick your name for them. They all believe in the same incorrect thing:
* the global wealth pie is a fixed amount
* if you have a bigger slice than someone else, you got it through ill means or nefarious deeds
* you are therefore a cheat
* you should be stripped of your wealth and it should be given to everyone else

Of course this is all incorrect on so many levels, and anyone can figure it out by bouncing a few brain cells around.

One thing that I always found amusing is that these so-called Progressives believe that their worldview is better, and that if you just submit to it you will see the light. They absolutely hate it when you tell them that you don’t need them. Case in point, this reminds me of a scene from Hell on Wheels, wherein the railroad magnate, J.P. Durant, and his congressional sycophant, are negotiating with a Cheyenne Indian chief for passage through their lands…

Durant: “Senator Crane has come here to offer your people a better way of life.”

Chief: “Better than what?”

Durant: “Uh… better than what you have.”

Chief: “I like what I have.”

Senator: “I understand that. But your people live in the stone age. We live at the beginning of a great industrial revolution.”

Durant: “Chief, the US government is offering you a piece of land, of your own.”

Chief: “We have our own land.”

Senator: “No. It’s not yours. It’s the US government’s.”

Chief: “Did they buy it?”

Senator: “No…”

Chief: “Did they trade for it?”

Durant: “It’s not like that, we…”

Chief: “Then how can they own it?”

Durant: “If you accept our offer, you won’t have to hunt buffalo anymore, or roam the prairie. You can depend on your country to take care of you.”

Chief: “You are not my country.”

Durant: “We will give you everything you need, if you will just submit to living on a reservation.”

Chief: “We need nothing from you.”

At which point, Durant loses his temper and closes the negotiation. They hate it when you don’t need them, and especially when you tell them directly.

Now this is amusing because the Progressives are always on the side of the “little guy” or the underdog and especially on the side of the Native American. Even I feel sorry for the Native American, especially when watching this clip, but not for the same reasons that the Progressives do. You see, when I watch this, I see the “evil capitalist railroad magnate” as the Progressives, and the Indians as the Capitalists. Change out “great industrial revolution” for “utopia” or “manifest destiny” or “workers paradise.” The actors change but the play remains the same.

Stop trying to force your lofty socialist goals on those who don’t want it, at the expense of our already-decent life. We like what we have. We need nothing from you.

As I am planning a trip to Japan later this year, I am diving into its history, language, and culture to prepare myself for the culture shock I will inevitably receive. As part of my historical bumblings, I came across some fascinating and ominous parallels. Namely, the rule of Tokugawa Iemitsu from 1632-1651. It’s such fascinating stuff that I am still picking through it and writing until 3:30am…

Iemitu

Iemitsu was the grandson of Tokugawa Ieyasu, the founder of the Tokugawa Shogunate, and the third shogun of the dynasty, the one that finally ran its feudal system into the ground. Ieyasu (grandpa) was famous for bringing peace to the warring fiefdoms of the Japanese empire and expanding trade with Europe. Unfortunately, as all sons of empire who inherit peace, Iemitsu could not appreciate that which he never had to fight for, and quickly began to destroy any and all things good. In 1620 he apparently had an argument with his lover at the time, and murdered him in a bathtub which they were sharing. Charming guy, for sure.

Once Iemitsu got into power, he began his reign by ordering his younger brother, Tadanaga, to commit suicide (for the “dishonorable misconduct” of being favored by his mother for the position of Shogun). Then he installed his friends to important posts, followed by all manner of onerous regulations which all citizens had to obey: from laws about fashion to laws about how farmer women had to wash their men’s feet at the end of the day (not just the act, but exactly how, and who and what must be involved in the process, and mandatory attendance of sisters/in-laws and other weirdness). There were taxes on windows and shelves, head taxes on newborn babies, and hole taxes for burying the dead. Rice, one of the currencies of the time, was also taxed.

Perhaps most disturbing about Iemitsu’s daily regulatory decrees is that he quickly learned how people would go to enormous effort to try and curry favor for special treatment under said regulations, in order to regain simple freedoms which they had previously taken for granted. A fact which he openly exploited as a tool to tamper with alliances among the rich and powerful as well as cement loyalties which kept or expanded his power.

Iemitsu established the sankin kōtai, which forced the Daimyo (regional overlords) to spend part of the year in the capital city of Edo and much of the remainder of their time wandering between Edo (now Tokyo) and their home turf, with all of their samurai and functionaries in tow, which effectively neutered them financially and politically, and often bankrupted them. In addition, the wives and children of the Daimyo were forced to live in Edo and could not leave. Overburden the regional leaders with too much regulation and hold their families hostage…

Iemitsu restricted travel. People needed passports just to go from region to region. Their belongings, clothing, and hair were inspected at various checkpoints. These checkpoints demanded that the female travelers be inspected by female agents, which unfortunately were uncommon. No inspection, no passage. Tough for you. Historical accounts from one such female traveler, Inoue Tsujo, who was a famous writer, recall tales of rough and uncomfortable screenings by haggard female inspectors with strange accents. Is all of this stuff starting to sound familiar yet?

How far we have come in 400 years!!!

Getting_Gate_Raped_By_The_TSA

Iemitsu enacted decrees which kept farmers from being able to consume their own produce– it all had to be cleared by a central authority and “properly redistributed.” Sound familiar? It should be no surprise that this sort of behavior brought about famine.

But it doesn’t end there. Farmers feeling the squeeze of too many taxes, too little food, and too much regulation eventually revolted and joined forces with persecuted Christians to form the Shimabara rebellion which burned brightly for a brief period but was then put down with deadly force in the last great battle within Japan. The rebels holed up in a castle and successfully held off the Shogun’s army, but in the end were starved out and then slaughtered.

After that, Iemitsu felt that the only way to keep things “going well” was to shut off all access to outside influences. Clearly it was outside influence that was causing rebellion, and had nothing to do with his asinine policies. He kicked out and/or slaughtered all the Christians, missionaries, and other foreigners, forbade Japanese from leaving the island, forbade any Japanese on foreign soil from returning to Japan, destroyed any seagoing ships that could be used to defect or travel outside of Japan, and closed the island to trade except for extremely regulated contact with the Dutch East India company. Japan’s doors would be slammed shut to the rest of the world for another 200 years.

It might sound like an awful lot to go through to get to this point but keep in mind that Iemitsu managed to do all of this– turning a prospering empire into a stagnant backwater– in just 3 years! After the quelling of the rebellion and the foreign purge he kept his way for another 16 years by ruling with an iron fist.