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These stories were published Tuesday, May 27, 2003, in Vol. 3, No. 103
Jo Stuart
About us
A.M. Costa Rica photos
Potholes ripped by flooding dot the landscape, but the culprit here Monday was a storm sewer with a missing grate. Just big enough to eat a tire! The scene was near the court complex about 3 p.m.
Economic impact of collapsed schemes
High-interest borrowing deals distorted market
By the A.M. Costa Rica staff

One major impact of the high-interest borrowing operations that existed here was a distortion of the marketplace, at least as far as North Americans were concerned.

In several cases, business people said major transactions failed because investors preferred to take their monthly interest from the investment scheme rather than to put their money in a more traditional business or real estate development.

The investment returns also allowed North Americans to purchase overpriced and sometimes deficient tourism businesses that only could survive with the subsidy coming from monthly 3 percent interest payments.

Less clear is how the investment operation distorted and tightened the market for private loans for legitimate businesses, but indications are that it did.

In addition, in many cases, those subsidized businesses failed to develop and follow sound marketing plans and to aggressively develop a client list. Money generated a better short-term return being invested with Luis Enrique Villalobos Camacho or Savings Unlimited than in extensive marketing efforts.

After the collapse of the Villalobos and Savings Unlimited operations last fall, business people/investors found that the bulk of their client list consisted of other investors who now were financially strapped. "After 16 years in business, and now I have to build an entirely new client list," one complained.

Another obvious result was the reduction in the number of periodic tourists who came to Costa Rica to collect their Villalobos interest money and spend it in high living here. That hurt the bottom line.

The full impact of these economic consequences has yet to be seen.  Some downsizing has taken place. Insiders in the tourism business report that some owners have exhausted most of their assets and are hanging on by their fingernails. All they have is a physical plant, and they cannot afford the purchasing and marketing efforts that such a business requires.

Among these are countless bed and breakfast operations, marginally feasible at best, hotels big and small, retail stores, plus a number of other tourist-related operations. Some of these are on the block this week as Expotur brings 

together those in the tourism industry here and would-be operators from the United States, Europe and South America.

The would-be purchasers are driving hard bargains because they know many operators have to sell or go under.

The situation in the business and tourism industry is more volatile than the general residential real estate market. Traditional real estate for North Americans here has taken a hit but residential properties have more price stability and are buoyed by a continual influx.

A higher percentage of businessmen and woman seem to have been investors in the high-interest schemes than the percentage of all North Americans living here. Plus many North American investors rented from Costa Ricans.

In all, some 6,500 investment accounts totally perhaps $1 billion were on the books of the Villalobos operation. Savings Unlimited had fewer investors and perhaps $240 million on the books. There were several other smaller operations.

Frustrated investors
might stage protest

By the A.M. Costa Rica staff

Some North Americans who lost money with the Luis Enrique Villalobos Camacho high-interest scheme are threatening to picket and hand out flyers to participants at Expotur this week.

The idea is to disrupt the tourism industry so much that government officials will notice and urge prosecutors to speed up the Villalobos investigation. One problem, of course, is that Villalobos is a fugitive.

Nevertheless, several frustrated investors have prepared drafts of flyers that blame the Costa Rican government for the demise of the Villalobos operation and the loss of their money. Expotur, a week-long gathering of tourism vendors and wholesalers is at the Herradura Hotel and Convention  Center through Thursday. 

Another investor, who identified himself as José S. Barles, has written a letter to President Abel Pacheco asking that Pacheco grant Villalobos an "amnesty" on the condition that all money invested or lent to him be returned. At least that is the gist of a copy of a letter faxed to A.M. Costa Rica. Barles could not be reached.

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Puntarenas to Paquera route
Possible giant hike in ferry fare worries lawmaker
By the A.M. Costa Rica staff

A proposed 251 percent increase in rates for the Puntarenas-Paquera ferry has caused one lawmaker to write the president.

The ferry connects the southern Nicoya Peninsula with Puntarenas and is used daily by residents who must conduct business on both sides of the Gulf of Nicoya. The ferry also is a principal tourist route to Tambor, Montezuma and other locations on the tip of the Nicoya.

Carlos Avendaño, leader of the Partido Renovación Costarricense in the Asamblea Nacional, expressed his concern. In his letter, he called upon President Abel Pacheco and Javier Chavez, minister of Obras Públicas y Transporte, to suspent a scheduled bidding process until other solutions can be examined.

Avendaño said he recognized the need to modernize the ferry. However, the current description of the concession that will be put out to bid calls for three newer ferry boats and much higher monthly expenses.

The Federación de Consumidores estimates that the current 630-colon rate for a single, adult passenger now would have to go to 2,210 in order to cover expenses. That’s from $1.60 to $5.64.

Many passengers also bring their vehicles. In fact, the ferry is a major lifeline to the southern Nicoya which is generally unaffected by the opening of the Río Tempisque bridge to the north. 

Connecting roads from the bridge in the central Nicoya to the southern Nicoya are not-all weather and generally are dirt and gravel for much of the distance.

Pacheco says he will not yield to ICE strikers
By the A.M. Costa Rica staff

President Abel Pacheco made his situation quite clear Monday in speaking of the striking communication and electrical workers:

"If I give the unions what they want, Costa Rica dies. If I don’t give them it, and the strike continues, Costa Rica dies. It will not be by my hand that Costa Rica dies. If they want to be responsible before history, so be it, but I am not going to yield."

The employees of the communication monopoly, the Instituto Costarricense de Electricidad, known as ICE, have been on strike since May 16.

Pacheco, in a statement released by Casa Presidencial, said that the unions have gotten every thing they have sought. He noted that the Central Bank has approved $40 million in bonds to 

be floated on the international market. And ICE has sought and the government supports a request for rate hikes that will bring in $30 million more.

The argument quickly becomes complex and budgetary, but the workers still were on strike Monday. One plan is to have mediation by the defensor de los habitantes.

Meanwhile, the government has promised to pay 99 percent of the striking teachers their correct wage this week. Teachers are on strike, in part, because of the computer snafu that has provided salaries widely different that the contracted amounts. Some teachers have gotten nothing.

The Ministry of Educación Pública made this same promise two weeks ago, and then failed to do it. Teachers have been on strike since last Friday after having agitated for weeks. That included marching to Casa Presidencial.

Kirchner faces need
to move quickly

By the A.M. Costa Rica wire services

The inauguration of Nestor Kirchner as Argentina's newest president Sunday marked the end of nearly two years of political uncertainty. Many Argentines hoping that the worst of their dire economic crisis is behind them. 

Speaking to several thousand supporters in his home province of Santa Cruz this week, Nestor Kirchner promised not to forget those who helped him in his unlikely bid for the presidency. "Things will be much better, so you all can live better, I am absolutely convinced," he said at his farewell rally. 

Though the 53-year-old Kirchner has been speaking with confidence these days, he faces tough decisions ahead. 

The little-known governor of Patagonia took control of a country that is still very much in the grips of a devastating economic crisis. In the wake of a $141 billion debt default, the value of the peso has plummeted, while crime, hunger and unemployment have soared. 

Kirchner and his new cabinet will need to address its domestic problems, while trying to secure a new aid agreement with the International Monetary Fund and renegotiate a large part of its debt with countries around the world. 

"I suspect that the incentives of this government will not be to renegotiate the debt very quickly," says Andrew Powell, a professor of finance at DiTella University in Buenos Aires and the former chief economist of Argentina's Central Bank. 

He says its vital that Argentina act swiftly in repaying its debt to the International Monetary Fund: "It’s 100 percent critical in my view. Argentina has to, is supposed to, repay the IMF a certain amount of money before the end of the year. I think it is almost $4 billion. If an agreement isn't found and Argentina doesn't pay, then Argentina will be in default with the IMF. I think that has serious consequences for Argentina."

Serious consequences that could relegate Argentina into an economic abyss by possibly cutting off all sources of international funding. 

Kirchner maintains that Argentina must build from within in order to move past its problems. He has promised to increase public work projects and create millions of local jobs that will come at a considerable cost to the country. 

But it is this free-spending rhetoric that has made foreign investors leery. Last year, investors balked at the campaign promises put forth by Luiz Inacio Lula da Silva before he became president of Brazil. Both men have been critical of U.S. policies, but it remains to be seen just how radical an approach Kirchner will choose to take. 

Atilio Boron, a professor of political science at the University of Buenos Aires, says "my expectation is Kirchner, facing a dramatic situation like this in Argentina, may also have the same kind of reaction that Franklin Delano Roosevelt had in America and started doing new things, changing the course of Argentine politics and changing the major orientations in economic policy. If he has the guts to do that he will succeed, if he doesn't he will fail and very, very soon."

Kirchner comes to office after having only received 22 percent of the vote. He was thrust into office after former President Carlos Menem withdrew from a runoff earlier this month. Critics warn that this weak start, coupled with the economic challenges ahead will likely result in a short honeymoon for this new president. 

Letelier’s son held
in corruption case

By the A.M. Costa Rica wire services

Chilean police have detained a leading socialist lawmaker on charges he illegally received $25,000 from a campaign donor.  Authorities took Juan Pablo Letelier into custody on Thursday, and are expected to  decide within five days whether to release him or proceed with the charges. 

Letelier is the son of former foreign minister Orlando Letelier, a critic of the  Pinochet dictatorship who was killed by a car bomb in Washington in 1976 on orders  from the head of Chile's secret police. 

Four other lawmakers from the leftist party of President Ricardo Lagos are also under  investigation for similar charges.  In his annual state-of-the-nation address on Wednesday, Mr. Lagos vowed to combat  political corruption.

Brazil’s Lula da Silva
to visit George Bush

By the A.M. Costa Rica wire services

WASHINGTON, D.C. — The White House says President Bush will receive Brazilian President Luiz Inacio Lula da Silva during a visit scheduled for June 20.  A statement from the White House Friday said the two leaders will discuss stronger  bilateral ties and ways to boost economic growth. The leaders discussed similar issues in December, when then-president-elect Mr. da  Silva first visited the White House. 

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Central American immigration to U.S. a big secret
By the A.M. Costa Rica wire services

Authorities in Mexico's east-central state of Veracruz discovered 31 undocumented immigrants from Central America locked in a truck trailer Sunday and have detained the Mexican driver and two other companions. This was only the latest incident in which immigrants have been found in life-threatening situations. 

Police spokesmen say agents made the discovery after stopping the truck to check its documents and cargo. The policemen heard noises from inside the trailer and from small holes that had been broken into the side of the trailer. After opening the door, the police found the immigrants, including seven women and two children. 

They later determined that the immigrants came from Gualtemala, El Salvador and Honduras and had paid for passage northward through Mexico. One of the detained immigrants spoke to Mexico's Televisa network from his jail cell. 

He said he and the other illegal immigrant passengers had suffered hunger and thirst for some days in the cramped, windowless trailer and that they thought they might die. 

Last week, authorities in southern Mexico found 92 Central American immigrants packed into a 

similar truck heading north. The police surveillance of trucks follows the death of 19 immigrants trapped in an abandoned trailer on a Texas highway May 14. After completing their investigation and arresting several suspects in the case, U.S. authorities sent the bodies of the 12 Mexican victims back to their families for burial. The funerals of these and other immigrant victims have been given ample coverage in the Mexican media. Last year 371 Mexicans died in the attempt to cross illegally into the United States seeking work. 

But the plight of Central Americans has not received as much attention in this country. Human rights groups say tens of thousands of Central and South American immigrants pass over Mexico's southern border with Guatemala each year. Mexican authorities detained and deported more than 57,000 immigrants on the Guatemalan border last year. 

For the most part the immigrants crossing over from Central America are headed for the U.S. border, nearly 3,000 kilometers to the north. Human rights groups working with immigrants in that region say they have received thousands of complaints against Mexican police for abuse of undocumented immigrants. Mexican authorities say they are working with neighboring nations to prevent immigrant deaths and injuries. 

Readers comment on Dundee Ranch editorial
Liked editorial

Dear A.M. Costa Rica:

Great editorial today on the Dundee Ranch story. You made some very good points, and I particularly liked the part where you ask Casa Alianza to look into the mirror. 

Having raised a kid in the U.S. and knowing many other parents with troubled teens, I am well aware of the problems facing families today. Everyone wonders what happened to that beautiful sweet child once the hormones start pumping. 

I was lucky or perhaps blessed to be able to still see that beautiful child even when he was trying his best to hide it. I remember a period when he was about 14 when I just had to lay down the law. It was the occasion of his last spanking, and it hurt me more then him because he actually outweighed me at the time. But the fact remains that I got the message across that he was too important to me to be lost in the jungle of the streets and the insanity of society today.

And, yes, I found a small private school where there was constant communication between the administrator and myself. Where if he misbehaved he got Saturday school instead of suspension. 

Now at almost 22, we think of those days as the rough patch and are always grateful that he came through it and we are still friends. 

And I agree that more attention and less money would help the teens today. 


Suzanne Smith
San Isidro de El General
Wants Dundee out

Dear A.M. Costa Rica:

Your editorial today, Monday, was thought-provoking. So here are a few thoughts:

Why don't these "tough-love" behavior modification people operate in their own countries, under regulations, supervision and oversight of their own laws, regulations and authorities in the U.S.?

Why do they "run away" from American jurisdiction, going off to the Czech Republic, Jamaica and now our country of Costa Rica, where they fail to register, violate our immigration laws and operate in jurisdictional "gaps," avoiding both U.S. and Costa Rican laws?

If they are legitimate, why not operate in their own countries? If they want to run away from U.S. jurisdiction, why do they not register here, comply with our laws, invite local authorities to supervise their work, meet our immigration laws and employment work-permit laws?

The fact is they are "outlaw" runaway, rogue operations, fleeing their own countries, often in trouble in their own countries, seeking a country like ours to operate outside our laws.

Costa Rica is tarnished with the "sex-destination" image. Now it is in The New York Times and elsewhere as an "abuse-the-children" destination, and center for rogue child-abusing operations from foreign countries.

Maritza Molina S. 
Parents are problem

Dear A.M. Costa Rica:

I read your editorial comments regarding Dundee and wondered how many others out there in the free world condoned these programs. In the old days they were called reform schools; prisons, so-to-speak, for the underaged. Usually you had to appear in court in front of a judge, during which you would at least have an opportunity to defend yourself.

With the advent of places like Dundee, a person’s day in court seems to have fallen by the wayside and with it one's individual (yes! kids are individuals) rights. Prisons for children who are deprived of due process should be illegal!

Privatizing the penal system does have its pluses. First off, they can now call them academies or correctional facilities. And more important, a profit can be made in supposedly fixing socially impaired individuals! 

The drawbacks? First off, there is no incentive to rehabilitate since the income is made on number of bodies incarcerated (as with Dundee). I suspect that if a kid cleaned up their act in, let's say, 90 days that chances are they would not get an early release and Dundee would cheerfully refund the balance of the $30,000 of the 1 year program.

A major flaw in the Dundee approach is that the parents are not a part of the rehabilitative process even though it's usually where the real problem(s) lies. The majority of research done on wayward kids points to their role models (parents are the first ones) as the source. 

Requiring parents to take parenting classes, for example, would probably solve the majority of behavioral problems kids manifest in early teens. Kids behavior problems are part of a systemic family pathology and by just focusing on the kid is like putting a band aid on a bullet wound!

The kind of training that Dundee offers is, for the most part, "anti-social" and does little to train a person to become a member of a civil society. Standing in front of a wall for a few hours does not teach one social skills.

My suggestion is that, rather than shutting Dundee down, they convert it into an adult facility to which parents of problem children could voluntarily check themselves in for however long it took to learn parenting skills.

Johann Wagener 

Readers react to 'ashamed' military veteran
He’s proud, not ashamed

Dear A.M. Costa Rica:

I have been looking forward to reading your paper everyday. Now that is all in the past. I would have closed the paper before I would print that story of a the Ashamed Military Man. I served a short time during WW II, but I am proud of every day.

Harry Purcell 
Port Richey, Fla. 
He flies the flag daily

Dear A.M. Costa Rica:

This is a reply to Mr. Underwood’s article Ashamed on May 27, 2003 Mr. Underwood. Sir. I think it is time for you to leave this country having an attitude like you have. 

I do hope in your leaving for another country that you and those that go with you will denounce your American citizenship. I am a "Nam Vet" and well aware of the treatment we received upon coming home. Those who hated us were, in my opinion, a bunch of dope smoking, long-haired hippies who didn't and probably still don't today have a clue that "FREEDOM ISN'T FREE" and it at times comes with a heavy cost of young American lives.

I've never spoken much about my service time (6/59 - 10/69) to anyone other than another veteran. Those who have not served don't quite understand what it's like and what it takes to be a member of our armed services. I believe we are a very special group of folks that have taken that extra step to insure the values and our freedoms stay intact. I firmly believe the highest honor of citizenship is not the right to vote, but to serve in her armed forces. You should never ever be ashamed of that, Mr. Underwood!

As for ex-president Clinton and his wife, I have little use for them and their conduct/actions or for anyone who speaks ill of our GIs. Bad mouth the politicians all you want, and I'll probably agree with you on some issues, but never ever disrespect those who have, who are or who will serve in the military. There's a speech by General Powell about the American GI you should read.

Your pastor was ever so right about being thankful for the men and women who have given us the freedoms we so dearly enjoy today. If it weren't for those "smucks" who served . . . would you have the freedom to write what you did and in what language would it be in?? 

Here at this house, the colors fly daily along with the "black flag" (weather permitting) and have done so for many years. I, for one, am not ashamed nor afraid to show my patriotism for "MY COUNTRY" no matter what some people or politicians actions have done to tarnish it.

It does sicken me at times that Americans are rather reluctant to display the American Flag because of what others may think of them, but can spend money to buy "L.A. Laker" flags to fly from their cars, homes and work place.

I best stop at this point or this will turn into a novel. Good luck to you and your family and I hope you enjoy your new country.

A Damn Proud Smuck, 

J. I. Case 
Palmdale, Calif. 
Calls letter rubbish

Dear A.M. Costa Rica:

Re: He's ashamed to be a member of the military. 

Shame on you A.M. Costa Rica. What possessed you to print such rubbish. I find it hard to believe that you could not have found anything else to write about. Stan Underwood is mad at the world and has no life. He will never find happiness no matter where he goes unless he resolves his deep-rooted problems. 

It is sad that he feel this way. His negative attitude is having such an adverse impact on those close to him. He is wrong. Most Americans believe and have faith in our military - check the polls. President Bush is doing a wonderful job. I believe President Bush will be recognized as one of the best presidents that we have had, due to what he has and will accomplish. 

Al Almeida 
Nuevo Arenal 
Says view minority one

Dear A.M. Costa Rica:

Sad. Why, on this U.S. Memorial Day would you give such weight/space to the negativity and ugly karma that Mr. Underwood exudes in "a reader's view." 

Is this your newspaper's way of letting everyone share his opinion? takes up fully half of the space on the page.

I posit that less than 1 percent of past/current servicepeople share this sentiment. Why not dwell on the positive, majority view?

My dollar to your dime says Mr. Underwood hasn't sent this letter to the editor of any newspaper in Colorado. Coward.

Bruce Riley 


Why blame Bill Clinton?

Dear A.M. Costa Rica:

When reading Mr. Underwood's tirade about the treatment of the military personnel during the Vietnam war, it stunned me that he blamed Bill Clinton for the treatment that the veterans of that war received upon their return. 

If he would search his memory, he would find that during the time that most people were disenchanted with the U.S. role in Vietnam, they voted for and supported Richard Nixon as president. Bill Clinton was no where around. 

I was also surprised that he objected to Bill Clinton's military record. The truth is that Bill Clinton had a college deferment, as did many of the young men at that time. When his education was done, he was eligible for the draft. His number was not called. 

I would wonder why Mr. Underwood did not add his utterances of disgust at George W. Bush's military record, which is much shadier than Bill Clinton's. George Bush joined the National Guard and was AWOL for the last 18 months of his enlistment period. 

The politicians made much of Clinton's not serving in the military, but I understand that only two of the "chickenhawks" in this present administration served. Others had lame excuses, such as "I had other priorities" or "the spots were all taken by minorities."

Had Bill Clinton said such things, he'd have been crucified. It pays to come from a rich and powerful family. Also it pays to belong to a rich man's party. 

Kathleen Wilde
Don't be defeated

Dear A.M. Costa Rica:

Anent the letter decrying service in the United States Air Force one can understand the bitterness about the lack of respect and understanding by some "Americans" towards those who were willing to sacrifice to preserve and support the ideals of the United States-Freedom of speech and religion the opportunity to vote albeit it seems that we have little or no choice as to the quality of some candidates, tolerance, respect for others and appreciation for those who are "stupid" and "foolish" enough to believe that service to one's country is a noble calling.

Hilary Clinton had every right to oppose the Vietnam war and to express her opinions and she had a right of free speech to burn the American Flag—which in fact she did—but should she have gone that far to desecrate the flag which is and has been used to drape the coffins of military personnel who did not believe in "looking out for number one." but who fought and died for a country where not everybody is understanding of what freedom is and what it sometimes costs to preserve.

Did you know that the Clintons did not want the military to wear uniforms in the White House"?

Did you know that Hilary embraced and hugged Mrs. Arafat? Would Eleanor Roosevelt have embraced Eva Braun, Hitler's mistress.? I do not think so.

Sadly, the Sharptons, the Jessie Jacksons, the Clintons and the Democratic Party are not truly representative of the real and true spirit of middle America — of the silent majority.

The Clintons and others of their ilk look with disdain upon those of us who are naive enough to believe that democracy and freedom of religion and freedom of speech, tolerance and understanding, respect for others are worthy goals which oft times need to be defended, to fight for and unfortunately to die for.

We should not let ourselves be defeated by the "hate America-hate the military" crowd of Barbara Streisand and the Clintons — we should stand up proudly and rebut and rebuff those who look with contempt upon those of us who truly believe in the precepts of the Ten Commandments, The Declaration of Independence and the Constitution.

We may not agree with all of George Bush's economic policies in whole or in part or with some of his views on foreign affairs but those with an open mind can certainly agree that he has restored dignity to the Presidency and to the White House and dignity and honor to the military and we should do all in our power to preserve that attribute.

Parenthetically, the Democrats decry the Bush tax proposals such as eliminating the marriage penalty tax, double taxation of dividends, elimination of capital gains, arguing that we have a deficit. But Clinton and the Democrats never urged these tax proposals when we had a surplus, and, indeed, Clinton proposed and urged and had enacted an increase of the tax on social security.

Think about that.

Don Sherwood 
Las Vegas, Nev. 
Letter was ill-timed

Dear A.M. Costa Rica:

Your published letter by a person named Underwood was not only ill-timed, but expresses your disrespect of those who served and died so that you can live free. You should be ashamed.

Jim Bray 
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