I feel the end on an era coming close. I had this feeling for quite some time, and now I think I see clear signals of it materializing. Panama is changing, and the economy is giving turns for the better and for the worse. Yet it is relative to which side you are on.
Panama had six past semesters of unprecedented growth. This year GDP will surely be above 7%, with financial services, tourism, telecommunications and construction leading the way. However, the economic growth and market liquidity brought along inflation, and the first ones to feel it were the lower classes.
Let me give some clear examples.
I used to make a supermarket buy every week. If I wanted to save money, I would go low and buy basic staple food (rice and beans…) I would buy cheap local ice cream and maybe local cookies. I could probably do it all within the 25 to 35 dollar range. When things got better, I started buying wine from Chile and Hagen Daze ice cream and I would spend around 80 dollars on a supermarket. But I did not complaint since I would enjoy my Spain paella and Greek olive oil.
Nowadays I buy a modest supermarket for 70 dollars. My expensive supermarket visit goes well over a hundred dollars. If you compare, the rich people are spending 20% more, from 80 to 100. But the poor people went from 35 to 70. That’s a 100% increment, which wasn’t met in salary increases.
The same goes for cars. In 1998 I bought a Daewoo Racer for 7,900 dollars. It was a great car and I loved it. The day I sold it I cried, and I would by a Daewoo anyday since I had two and they never broke down.
Ten years later, I can’t find a brand new car for less than 13,000 dollars. That’s around a 90% increment for the lower classes. Of course, the new BMW series 3 is around 35,000 dollars; it actually went down in price! So the young executive gets a saving cut, but the lower class worker gets a hefty increment he or she might not pay.
The last exhibit is Panama’s department stores. The ones with fancy names like “Madness” or “The Crazy Goose”. In the old day, a place like “The Cost” would have cheap beds for 89 dollars. It was fine. I planed my first home with a 500-dollar budget, which is not much but it did fine. I did not buy fancy stuff, but I got a bed, a fridge, an oven, etc.
Nowadays a place like “Conway” has elite furniture from India at two thousand dollars or more price tag. Even the cheaper furniture from China is getting a little to steep for the common worker.
No wonder the SUNTRAC, Panama’s construction union, went on strike. I can understand the predicament of poor people, yet I think closing down venues is not the answer.
Sadly for the average Panama person, the answer is meeting the new benchmark with more work and more savings. The era of spending it all and wasting it all in parties (I love Panama, but even Panamanians will agree to this) will be over soon. Those who do not step up to the challenge will be left behind.
What I fear is that discomfort among popular sectors will push fascism. Panama is notoriously known for its hate of the left. Popular sectors will gladly search for answers in the right wing fascist parties (such as the Arnulfismo, since Arnulfo Arias studied in Germany and was an eloquent believer of the German Miracle of 1936). The first wave of xenophobia against the Colombian immigrants is beginning to gain crescendo.
The ending of the golden era of affordable material items is over. Sadly the next era might be one of polarization where one sector of society grows ever more wealthy while another is weighed down by its own lack of education, drive and desire to evolve.
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