Skip to content

Where the Money Flows

December 17, 2011

I’ve spent the past year analyzing the way that people in the Comarca spend money and where that money flows as a result of those transactions. Since the Comarca is based on collective land rights, all property within its borders pertains to Ngäbe and Buglé people. This has a couple of interesting consequences. Namely, people do not qualify for credit or bank loans because they lack collateral and property titles, and therefore (shockingly), few large scale businesses exist.

That means that few people actually work for other people and it increases families’ dependence on what they produce on their farm. Ultimately, even when there is money flowing from salaries (as teachers, for example) or government welfare, a great deal of it flows right back out of the Comarca into the hands of merchants and food growers in the rest of Panama. As you may imagine, this makes it difficult to build anything up around here.

Of course, not all purchases from outside the Comarca are negative (a cell phone, for instance), but it does indicate one reason why the region remains economically underdeveloped. Think of how many transactions you make in a week and of all of the places that the money flows from your purchases. How much of it benefits your local community? Here, the options are few.

Despite many obstacles, many groups and individuals have come up with some creative ways to get some extra cash in their pockets and benefit the local economy in the process.

The Butcher

I can’t tell you how many times a little kid has come to my house to announce that their family will have una pesa of a cow (a butchering) the following day and that I should cooperar (cooperate, but more like ‘help out’ in this context). Last week, my old host dad had a pesa to sell cow meat. The going price is $1.50 per pound, which, when all the numbers are crunched, turns a substantial profit. Typically, he buys cows when they are young for about $250 each. They then graze in the pasture for a year, wait until they grow big and fat, and butcher them to make around $450, for an 80% profit.

The main costs are for seeds for pasture grass (which ends up being about $5 per cow) and for vaccines and vitamins (which most people around here don’t bother with). If you have the capital to buy a cow, the patience to wait a year, the land to graze it on, and knowledge of how to butcher it, you can make a pretty penny. However, this is a great example of a small scale business activity that has a large external cost (read: environmental cost). Cows take up a LOT of space on land that is deforested. Overtime, cows and pasture grass deplete soil nutrients and make it impossible for native plants to grow again in the same spot.

Selling Chicken Poo

Have I caught your attention? That’s right, chicken poo has value. Most family chickens are on the loose and sleep in trees at night (yup, I was surprised too). But some families have built coops or started small scale chicken projects where they raise industrial chickens in a small coop so that they get fat and can’t lose weight by walking around. One bi-product of these newly cooped-up chickens is that all of the chicken poo mixed with saw dust or hay on the floor of the enclosure makes for a real awesome organic fertilizer. Every 2-3 months, one can ‘harvest’ the chicken poo mixture and sell it in sacks for $10. It is an awesome example of recycling and sure beats buying nitrogen fertilizer for $47 a sack.

Image

The Tamale Ladies

Every group of women here knows that tamales, chicken soup, and chicken rice are great products to sell to earn some money during community events. One group of women from the Catholic Church that is raising money to build an artisan house always sells tamales (their specialty) on days that the town will be full of people. There are four parades in Chichica between October 28 and November 28, which means many an opportunity to make some money.  $6 worth of corn, $8 worth of chicken, and $2 worth of spices makes a total of 60 tamales that they sell for $0.50 a pop. They always sell out (on account of their deliciousness) which realizes revenue of $30, and a profit of $14. This works out to a 46% profit margin. Since they are only a couple hundred dollars away from reaching their goal, every little bit helps.

You may note that the calculation ignores the cost of labor. $30 revenue does not cover the cost of four women waking up at 4 a.m. to prepare the food and for another four women to sell it all day. The reason that selling food is profitable is precisely because the women do not account for their time spent. When we teach how to calculate costs, we encourage people to account for time spent and try to assign a dollar value. They are usually shocked that even when they value their time as low as $0.50/hour, their revenue often does not cover it.

We aren’t trying to make them feel bad, but rather to recognize that their time has value and to analyze which projects are worth investing in. However, in the absence of other opportunities, most people choose that any small cash earning is worth it. It explains why artisan women will sell a hand-made purse that took a month to make for a mere $7. Or why 8 women are willing put in a day’s work for $14.

The Bar that Moonlights as a Foundation

Our local bar is run by an awesome old guy named Tío Venero and his nephew Necho. They support the local boozers with a place to buy beer but use the profits to support community activities. They buy uniforms for the local soccer team, trophies for sports, and also organize a giant activity for Mother’s Day that benefits around 600 moms from all around the district.

Image

They feel ambivalent about their source for fundraising. They enjoy that they provide a safe and secure place where locals can go to get a drink if they desire, but at the same time they lament that it serves some individuals that are substance abusers. At the very least, they take comfort knowing that they use a large sum of the profits to support community activities. At least they are funneling beer dollars that would have been spent outside right back into the community.

Advertisements
One Comment leave one →
  1. December 18, 2011 3:04 am

    I really liked how you explained that they don’t realize that their time has “value.” In a community-based culture, I presume that everyone has his or her duty and each person’s contribution and time is equally important to the community. It’d be interesting to see what a CEO making $6000/hr and a teacher making $16/hr looks like through their eyes.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s

%d bloggers like this: