early and died young. Shakespeare’s Romeo was 14, one recalls, and Juliet 12 when their love affair took place. The Elizabethan audience had not been shocked. This had represented late-medieval reality.
Gabriella was the first Paraguayan I had met who had lived for an extended period in Europe, and who knew both cultures intimately. She had worked for the BBC World Service in London and her husband had worked in import-export. They had managed to save enough money to buy a small flat in a remote suburb of outer London. This, she told me, they rented out to a fellow South American. Like so many people from unstable economies with erratic currencies all over the world, a small stake in British real estate was a hedge against uncertainty at home. I asked Gabriella how she managed in Paraguay now that most of the local banks had collapsed. ‘I only use my bank account in London,’ she replied. ‘I have never had an account here. I wouldn’t trust any South American bank. When I want cash I put my UK plastic in the hole in the wall here, and draw out US dollars in cash.’ This, I learnt, was quite common for middle-class South Americans in Uruguay, Paraguay, Argentina and Brazil. You had your bank account in Miami, in Dallas, in London, New York or the Cayman Islands; all your money you kept out of the local economy, because neither the currency nor the banks could be trusted. Those who had ignored this simple rule of financial security in Argentina and had trusted the government’s one-peso-equals-one-dollar policy had lost their money when the government defaulted, devaluing the peso and freezing bank accounts.
The government had, in effect, stolen the people’s money by reneging on their promise of parity. For the last two centuries South America had been a sink for capital. You could make money fast, but if you trusted the local banks or the local currencies you lost the lot, eventually. The ideal export product was cheap to make in South America and very expensive to sell for dollars or pounds abroad – hence the huge popularity of cocaine and marijuana as cash crops, and the fortunes made by processing and exporting these drugs in Paraguay and elsewhere. The whole country was dotted with illicit, hidden airstrips in remote places, where light aircraft – avionettas – landed and refuelled, carrying out drugs, contraband liquor and cigarettes, and carrying in guns, dollars and essential spare parts. These strips were constantly being discovered by the police, though very rarely were any planes intercepted. With extended fuel tanks fitted the standard light plane could reach Miami or Dallas – or private airstrips in the desert in Texas or Arizona – without having to land to refuel. The rich – and the criminal – all had private planes.
Since the arrival of the Spanish, and even before, South America had been a place of plunder. The great empires of the Aztecs and the Incas had been based, too, on military conquest and the exploitation of subject peoples; both of these tyrannies had practised extensive human sacrifice, the victims taken from subject and defeated peoples. This continent had long been a place where people imposed their will and seized what there was – gold, silver, slaves, sugar, cocaine; the products changed, but the economy of looting continued. It was normal and natural for South Americans to go into exile when things went wrong. The concept of life was still colonial, with strident nationalism in local politics, mirrored by a furtive, clandestine export of capital away from local risks – instability, revolution and chaos. When the time came to flee the exiles already had their money, their houses, their other lives in safe havens prepared abroad in safer places. Gabriella and her husband lived in Paraguay – but only just. Their capital, their property was in London. They rented in Asunción because it was not secure to own. Everything in Paraguay was very cheap to buy by US or European standards, and everything was up for sale. In the past, people had put their money into real estate because they didn’t trust the local banks. Now they wanted to sell and go away again. Stroessner had been bad, but this pseudo-democracy where everyone was corrupt and everyone stole and no one was accountable was worse. You could buy houses, apartments in Asunción for half, for a third even of what people were asking, Gabriella told me. All the flights out to Miami and Dallas were booked up for months in advance, and the planes arrived all but empty. Gabriella and Hugo had shipped down some furniture from Miami when they came back. That could be sold quickly or shipped out again if things went wrong – Hugo had ‘Italian papers’ so they could always go to Italy, she told me. People in Paraguay talked of having ‘papers’, not of being a particular nationality. It was where you were allowed to live that counted. ‘Life is easy in Paraguay, it is cheap and there are servants, but it could all go wrong very soon,’ Gabriella told me. They had only been back a matter of months, and they were already thinking they might have to leave again. Almost unknown to the prosperous, secure peoples of the developed West, millions of the educated, the skilled, the able in the Third World live like this. In Sudan, in Albania, in Sierra Leone, Malaysia and Indonesia people watch nervously for the signs that some imminent collapse might be just round the corner. In Paraguay, the first casualty of any coup d’état would be the liberal media; there would be no place for a BBC reporter under a military dictator.
Before Stroessner came to power there had been a long, bitter civil war in Paraguay. As many as a third of the population had been killed – no one was sure how many had died. Lawlessness and banditry had been rife. Stroessner had taken over and enforced both peace and stability. Like Spain after the Civil War, the exhausted country had acquiesced. Yet with his peace came torture and institutionalized corruption, the eclipse of civic rights, and great injustice. As many as a third of the remaining population had fled abroad, mainly to Brazil and Argentina. Some had come back but many still stayed away. Paraguay was a risky place, but the safer countries they had fled to before, Brazil and Argentina were now themselves places of disorder, chaos and financial collapse. The press was full of massive banking scandals, directors who plundered their banks and then fled. In Argentina, the economic collapse had caused riots, kidnappings and massive unemployment. In a poll, 57% of young Argentines under 25 said they wished to leave the country as they had no faith in its future. The world was divided into those countries everyone wanted to leave and those everyone wanted to get into. The latter group was very small, and mostly run by Anglo-Saxons or Scandinavians. Argentina, Paraguay and Brazil were all immensely rich – but then so was the Congo. There was no use in great mineral wealth, skilled and talented people, and bountiful natural resources if there was corruption, if everyone stole from everyone else. In such places your money, and in the end you and your family, were only safe somewhere else.
All over Asunción there were large, unfinished tower blocks, now rotting with decay. They had been overambitious for the scale of the city, clearly. Why had anyone ever put money into starting to build them? The price of entry into Paraguay during the stronato was investment in the local economy, Gabriella told me. The high-ups in the Colorado Party had owned construction companies which took the investors’ money and ran up these partly completed structures, syphoning off most of the money into their bank accounts abroad, then simply abandoning them. Corruption under Stroessner became endemic and systematic. Even the very poorest had got into it. The ‘hormigas’ as they were called, the ants, plied to and fro across the border with Brazil, smuggling goods to and fro by hand, in bags and cases, bribing the Customs each time. ‘Contraband is the price of peace,’ Stroessner said. Smuggling, bribery, corruption and illicit activities of all kinds became the bedrock of the economy. The country began to forget how to work. Once oranges, bananas, tropical fruit of all sorts had been grown commercially and exported to Brazil and Argentina. Now all these products were imported from Brazil, from Colombia. Under Stroessner everyone had been able to become a small-time contrabandista. One of the reasons for the complete absence of any coherent collectivist left opposition was the petit-bourgeois, small capitalist mentality that reached right down to street traders and Indians selling vegetables in the streets. There was no local car industry to protect in Paraguay, unlike Brazil and Argentina, so shiploads of second-hand cars came up the river, bought in job lots in the southern USA. And stolen cars poured across from Brazil, driven in from Sao Paulo, the Customs officials on both sides bribed. The contrast between the beggars on the streets, the mendicant cripples, the unmade roads, broken pavements and leaking water mains in Asunción, and the massed ranks of brand new BMWs and Mercedes was marked. The President and his wife were both alleged to drive cars stolen in Brazil – a local newspaper had exposed the story and printed photos of them getting out of the hot cars which had been hijacked from the streets of Sao Paulo. I mentioned J. K. Galbraith to Gabriella – she was a journalist after all – and suggested that his dictum of ‘private affluence,