- How The World Really Works

I was out last night with an old friend from the energy business. He’s a higher level guy who made his bones in the trading world, and is now doing private equity and project financing in energy development. This takes him to a lot of third world countries who are developing energy resources and he is usually dealing with the ruling classes and the senior government people in those locales.

He told me a story of one of his partners in Mexico who had a polo field he wanted to water. Polo is very popular among the ruling classes in Latin America, and to water a large area like that you need pressurized water, which you get by putting a big tank at the top of a nearby hill and pumping water up into it.

So he bought himself a big water tank appropriate to the task, and went to hire a crane to put it at the top of a nearby hill. Thanks to Mexico’s Marxist trade unions and intrusive and heavily corrupt government bureaucracy who are always anxious to fleece 'the rich' when they can, a crane to do the work he needed would cost him about $250,000 per day. He didn't like the price.

Instead he hired a local peasant to sit by the side of the road and wait for a crane. He was there by the side of that road for 8 months before a crane finally rolled by. when it did, the man got up from his folding chair and flagged it down. He then bribed the driver to pull off the road and do the work he needed. Total cost for the bribe and the 8 months of an otherwise penniless man waiting to deliver it: about $3,500.

That’s how the world works in places where the government tries to control everything. That’s the future that Obama and the Democrats would have us embrace. They don’t realize this of course. They think it will be a paradise where ‘experts’ will be making all the important decision taking into account all the political stakeholders. But in reality it will be a guy sitting on the side of the road for 8 months, in order to bribe a guy to do his job, without getting the government involved.