Bitcoin in El Salvador: Economic Savior or Government Surveillance Tool?

Coming to you LIVE from Bitcoin Beach in El Zonte, El Salvador, our guest today is Tim Muth, a man who has been writing about the news and politics of El Salvador and also acts as a critic of El Salvador's bold leap into Bitcoin. He first arrived in El Salvador as part of his church’s mission team, however then frequently returned to the country years after, and eventually leaving his business lawyer practice 8 years ago to live there full-time. 

In this episode, we discuss the realities and implications of making Bitcoin a legal tender, and Tim shares his personal experience of the transition El Salvador has gone through.

Have you ever wondered: how does El Salvador navigate the current Bitcoin adoption? It’s not an easy one. Balancing financial technology and retaining people’s freedom is no small feat. Some concerns have come up including government surveillance and wallet privacy, highlighting the trade-off between economic transformation and civil liberties.

Furthermore, press freedom under President Bukele is endangered, and some people are concerned about government spying. Investigative journalism is challenged as it continues to hold those in power accountable. Some news agencies have their own bias regarding the coverage of Bitcoin. He also sheds light on how the current government policies are making an impact not just on the economy but on the very society.

With the ongoing adoption of Bitcoin, despite its promise, Bitcoin doesn’t seem to live up to expectations. Yet, there's no denying that the introduction of Bitcoin has brought significant changes, both positive and negative.

But life in El Salvador has changed since their adoption, including the good and the bad. This conversation turns to the real-life effects of the country’s Bitcoin venture, from financial inclusion, the efforts of the government to stop gangs, COVID-19 responses, and even the Bitcoin wallet privacy concerns.

Tim Much's first-hand experience of El Salvador's adoption of Bitcoin provides eye-opening insights into both the positive and negative aspects of this move, as well as the possibilities for the future. So make sure to tune in to learn more!

Live From Bitcoin Beach

Transcript

Tim Muth  
I think we have to be vigilant for those kinds of things. I mean, one of the areas that I work in the US is on police surveillance and helping people not get surveilled by the police because I have those kinds of concerns. I mean, we're in the same side in that issue of worrying about surveillance by the government of people who want to exercise their free speech rights.

Mike Peterson  
Today, we're fortunate to have one of our Twitter critics here with us to talk about El Salvador and Bitcoin and kind of what he sees happening here with the government. Tim has a long history here in El Salvador, maybe longer than me, I'm not sure. Give us a little bit of your background about how long you've been here in El Salvador.

Tim Muth  
Sure. My first visit to El Salvador was 2001. 

Mike Peterson  
So you were here before me a couple of years?

Tim Muth  
And yeah, so I, so it started with visiting El Salvador. And then a couple years later, 2004, I started writing, what had this great name, it was called Tim's El Salvador blog. And it was, and is an English language website blog for people to learn about what's going on in El Salvador. So it was really started out and still is this English language source of information. And I've been writing about news and politics from from El Salvador for, you know, this will be my twentieth year until 2024, since I started writing. 

Mike Peterson  
And you were kind of back and forth sometimes you were living down here, sometimes you were in the US?

Tim Muth  
Yeah. So it started actually with a church relationship with a church here in El Salvador. And we'd made some mission trips and different visits down here over time. But then more and more as I started writing, my trips started getting longer and longer and duration, and they were more and more frequent, closer and closer in time. And now, it feels like we're almost living here about halftime and halftime back in, in the United States.

Mike Peterson  
So did you feel like you kind of fell in love with the country? Or was it more of a mission driven decision to spend time here or kind of both, or?

Tim Muth  
Hey, I fell in love with the country just after I got off the plane in 2001. We were greeted by a group of people from our sister church community, they had filled up a whole school bus to come and greet us at the airport at that time. And I always tell the story that this way in a bus was completely full when it arrived at the airport. And then we had a group my whole family came down. We had about 15 people who then piled into the bus. And so there was a little girl, probably about four or five, who sat on my lap. And at that time, my Spanish was really pretty limited. I hadn't spoken Spanish in about 20 years, but and she certainly didn't speak any English. But there was still you know, I grinned the whole way up on the drive from the airport. So it really was love at first sight with with El Salvador for me. 

Mike Peterson  
So I came across your blog pretty early on, because we moved here 2004. And I think we bought our place in 2005. And, you know, when anytime I would search, there wasn't much available on El Salvador at that time. So yeah, your blog would would come up and lot of interesting things. And I definitely tell you, we're left leaning, you know that our politics wouldn't align. And then I think I found out last time we got together you were a lawyer for the ACLU. Is that correct? Or?

Tim Muth  
Yeah, so sort of my career path I did 30 years as a business trial lawyer, just doing lawsuits for businesses. And that overlapped with the start of my coming to to El Salvador. But then, about eight years ago, I left that private practice and in the US, yes, I'm a lawyer at the American Civil Liberties Union, handling civil rights lawsuits. 

Mike Peterson  
So what happened with them in free speech? Because, you know, I was always a fan of them when they were hardcore free speechers. But now they seems to have gone the other direction. What's your?

Tim Muth  
I mean, I'm not sure that I would agree with you that we've varied from that. I mean, free speeches is complicated in the US, but, you know, the American Civil Liberties Union spend in front of the Supreme Court in the last several terms on different free speech cases, arguing for free speech. So it depends on the context.

Mike Peterson  
I mean, they used to, like go defend, like Nazis and people they totally disagreed with, because they thought it was so important to have free speech, be represented. It's there's definitely been a shift of them saying, no, there's, you know, hateful speech or there's dangerous speech, it's, I wouldn't say they have.

Tim Muth  
There are still, I mean, I can't discuss a lawsuit that I just learned about. But there are there are still situations of the ACLU representing groups whose speech I find hateful and wrong. Another thing that's happened in recent years is the growth of what you might call law firms, public interest law firms on the on the right, where groups who are more aligned on with their issues can go and get representation. Whereas, perhaps in the past, the ACLU was the the only organization out there. But I'd pushed back on the idea that we are not advocating for free speech.

Mike Peterson  
Alright. That's what I like to hear free speeches crucial, regardless if we agree with the people or not. 

Tim Muth  
Well, I agree with that. And that's, you know, one of the challenges in this country. I mean, while the President says that he does not, and has not locked up anybody for their speech to have the head of the government openly attacking the press set, and regularly denigrating it is a challenge to free speech kinds of kinds of issues. But, you know, we digress.

Mike Peterson  
Well, I think that's part of what we're here to talk about today. So, I know that's been something that the accusations have been made is that Bukele's trying to suppress the press. I'm kind of shocked by that. Because I mean, do you have you felt personally in danger at all or concern for yourself? I mean, you're a frequent critic of the government and the President.

Tim Muth  
Certainly there have been times when there have been internet trolls, who have, but and you see them too, yeah. And it's not as if, as if Bitcoiners are immune from having trolls go after that online. You know, there was at one point where a particular fairly high ranking politician in the government, you know, posted an attack against me, and then all the sudden there were all sorts of other people piling on, but I've got a pretty thick skin and, and I just don't, don't read those, you know, so.

Mike Peterson  
But I mean, I've traveled quite a bit. And I've been in the places where people are afraid to voice their views, you try to talk about something and they totally go the other direction, or when you're going into the airport, they're searching to make sure you don't have video recording devices. I mean, El Salvador does not feel at all like that to me. It feels like the critics of the president are free to be outspoken. I don't see, really, I have a hard time with that accusation that they're really being suppressed.

Tim Muth  
You know, I mean, there are certain things so I mean, let's take the what I think is the pretty well documented instance of reporters for El Faro in investigative news site award winning a news site where I think 14, at least 14 of their reporters had their phones infected with Pegasus spyware. Now that is spyware sold by an Israeli firm that only sells it. They say to government, government entities. And El Faro, you know, clearly has been a news outlet that has exposed issues that the government perhaps didn't want expos. And so the valid question is, if you have software installed on the phones of critics of the government, and it is software that totally sold to governments, who was behind it.

Mike Peterson  
Do you think that the US government has ever done that before?

Tim Muth  
Do I think the US government? Sure, I, I worked for the ACLU, we sued the US government over these kinds of issues. All the all the time, I think.

Mike Peterson  
It could possibly have been the US government installed at El Faro.

Tim Muth  
It doesn't seem to make a lot of sense. I mean, in terms of I mean, what's in it, for the US government.

Mike Peterson  
They seem to want to know what's going on.

Tim Muth  
But it would make a lot more sense for the current government.

Mike Peterson  
But when you say that that's kind of the norm in this world that most countries governments, or it's not unusual, I don't know, whether El Salvador was involved without or not, but I just always assume every government is doing that in their own country, including in the US.

Tim Muth  
And I think we have to be vigilant for those kinds of things. I mean, one of the areas that I work in, in the US is on police surveillance and helping people not get surveilled by the police, because I have those kinds of concerns. I mean, we're in the same side in that issue of worrying about surveillance by the government of people who want to exercise their free speech rights.

Mike Peterson  
They did one of the HRF Human Rights Foundation, they did a one of their conferences I was at they had a seminar basically on that, and they had people there that could check in because there was a lot of different rights advocates there. And so they actually get the over your phone, and a lot of them did have from around the world had Pegasus installed on their phone during that time.

Tim Muth  
Yeah, no good government definitely, you know, it's not always the bad guys that they are spying on, right?

Mike Peterson  
Yeah, yeah. No, I'm hundred percent against anything like that. I just think we need to look at the broader picture. And if we're gonna hold one government and say that they're persecuting the press, then another government's doing the same thing, we should have the same accusations for them. I think sometimes El Salvador's held up unfairly in that regard, that if they do anything that everybody else is doing, that they're criticized for, while we kind of turn a blind eye to what the other countries are doing.

Tim Muth  
I think it's definitely important to apply, you know, the same criteria to both governments. It always makes me laugh, when, you know, I will write something that may be critical of the South, the Salvadoran government, and people will say, you know, but the US government does that, as if that's somehow an attack against me, because, you know, I spend a lot of time criticizing the US government for doing those.

Mike Peterson  
I'm definitely not an advocate for whataboutism, but I do think we need to, you know, at least keep it in context of, hey, these are things that are happening everywhere. Let's hold everybody to the same standard. But I would say beyond that. I mean, I know there's a number of reporters who have said that they had to, you know, to seek asylum in the US. I questioned whether that was just them taking advantage of the situation to get a residency visa in the US. I didn't see really anything from the government compared to other places I've been as far as I'm really going after people jailing them, persecuting their businesses, those sorts of things. And so I I'm just always perplexed when people say that that Bukele is suppressing the press.

Tim Muth  
I think I would put it this way, which is the level of antagonism toward the press for doing the work of the press is it is troubling and leads to attacks, particularly for women journalists. And, you know, the level of abuse that they get in online spaces is highly troubling. And it is true that a number of Women Journalists felt that they were not safe in El Salvador now. They weren't necessarily saying that they were afraid they were going to be arrested, but they felt that they needed for the safety of their family so or others too that they needed to leave. 

Tim Muth  
So, you know, it is an atmosphere created by a government that spends a lot of time accusing the press of their, they have accused the press of being in league with the gangs of the press wanting to harm the Salvadoran public. And, you know, the press is such an important part of maintaining transparency and putting checks and balances on a government in a democracy. That it does a real disservice to the public to have the press attacked by, you know, by public officials in the way that happens here in El Salvador.

Mike Peterson  
I definitely agree with that. But I would also say that the press can specifically places like El Faro have very much politicize themselves and have not been neutral on subjects. And I've talked to people who've been off record with El Faro. And they said even their biggest fear or concern with Bitcoin was not that it wasn't going to be good for El Salvador, but that it would be good for El Salvador and Bukele would get the credit for it. 

Mike Peterson  
Like there was this sense of them generally wanting bad things to happen. So that it would reflect badly on the president. And so I think it's I think it's coming from both sides. There's definitely an antagonistic relationship coming from El Faro that I don't think you saw in the past with with past administrations. After the FMLN like they have been going after Bukele.

Tim Muth  
Yeah, sure they were. I mean, if I remember really well, the El Faro article about the black bags of cash. The Funes government, you know, coming out of the, you know, El Faro, had the, you know, was the one that released the video of the IRENA politicians negotiating with the gangs at the time of the the 2014 election. I mean, it's El Faro, who broke a lot of the corruption stories about you know, about Funes and about Saca but before, I mean, Salvador, you know, has not had a good history.

Mike Peterson  
No, hundred percent. And I think we need investigative and jurors I maybe I'm taking it more personally because they've done some hit pieces on us with very inaccurate information and, and slanting things and so I'm like, Okay, if if they're saying these things that I know are untrue, it makes me curious how many other things that they're reporting as truth aren't truth. So maybe that's my own bias.

Tim Muth  
And, you know, I think you know, to the extent there are you know, things that they need to correct. You're right that, you know, accuracy is is important. What I have seen repeatedly from this government is never taking on the facts in an article but instead attacking the messenger. So, perfect example is like this. Barclays financial analysis from like two days ago, or the day before, and the attack from the President on the Barclays financial analysis is Barclays has a soros person on their board. 

Tim Muth  
So that's why they're attacking, as opposed to addressing the facts and the analysis in the Barclays report. And the one important takeaway from that report was the amount of borrowing that the Salvadoran government is doing from the Salvadoran pension system, right. I mean, it's, and this happens with governments all over the world, including the US government, finding that public pension systems or social security systems are a piggy bank for which to borrow from and fund to fund other things. 

Tim Muth  
And those facts haven't been engaged in by, you know, by President Bukele, by Max and Stacy, who put out things attacking Barclays. And instead, you know, it's attack the messenger as opposed to dealing with the facts. And there's so much of that, that goes on that a story comes out that reveals uncomfortable truths or reveal some corruption. And instead of saying, here's where you got the facts wrong, it's attack to the messenger.

Mike Peterson  
No, I think that's the general direction, not just here, but everywhere, I think in this space with the Twitter world and those things, it's the unfortunately, it's the one liners, they usually win the argument rather than getting into the details.

Tim Muth  
Yeah, you're right. And that's why I appreciate your invitation to, you know, a civil engagement and, you know, exchange of views and stuff, because there's so little of that still goes on. Right. And so I appreciate you inviting me here to talk today.

Mike Peterson  
No, I like delving into the issues and it's fun trading barbs on on Twitter, I have a very thick skin. My wife can't be on Twitter. She's like, but me, I find it enjoyable. And so, but I think that's different than being able to, like you said, sit down and kind of dig through and so.

Tim Muth  
Yeah, and I've been nicer to to you since I met you.

Mike Peterson  
So, you wrote this article, New crypto-colonialists claim to have found freedom El Salvador. So I don't know if you know this, but the worst thing you can do to a Bitcoin person is called him a crypto person so if you were trying to insult us off the bat that was it's a little inside baseball but there's a within within that world there's the people that are in Bitcoin and then the crypto people and they definitely are two different camps. 

Mike Peterson  
So but curious as to what you first what brought you to write this article. Because it's funny that initially I the criticisms I kept hearing from people was like bitcoins not really impacting El Salvador. It's not bringing tourists El Salvador, it's not bringing businesses to El Salvador. Now, it seems to be okay, it's doing all those things, but it's not helping still. So I'd be curious as to your take. 

Tim Muth  
Yeah. Right. So the article is not, you know, an article about Bitcoin adoption in El Salvador. As such, I mean, I've written plenty about that, and we can talk about that at a different time. 

Mike Peterson  
Can we get to set up with the Bitcoin well?

Tim Muth  
I mean, I've used a Bitcoin wallet, I have bought drinks at a bar with a Bitcoin wallet, I have put minutes on my cellphone with Bitcoin, I have bought a tourist visa with Bitcoin so I understand how to do transactions on the Lightning Network. And, you know, I even know kind of what that means. So I get those things. But, you know, so one of the things I noticed in the last six months to a year were a lot of people on on social media, YouTube, on Twitter and elsewhere, proclaiming that they had arrived in El Salvador and it was the land of freedom. 

Tim Muth  
I mean, and you know, there were people who are also sitting at this table and and talking to you and proclaiming about the freedom that they had found. And so I wrote this article to say that when you say El Salvador is a land of freedom, as somebody you know, who's come and set up shop, you're leaving a big parenthetical that needs to be said out. And that is, it's a land of freedom. For those of you who are arrived from the north, with a source of income, or with a background of assets, who have a college education. And for you, I understand that you may be experiencing this as a land where you feel free. But that is not the experience or and that is not the reality for the vast majority of the Salvadoran people.

Mike Peterson  
So just real quick, just to make sure we're talking about the same issue, I think there's two separate issues. One is freedom. One is is level of lifestyle and economic advantage that comes from coming from a place where the salaries are much higher from here. So I know sometimes they can be lumped together. But I do think there are two separate issues.

Tim Muth  
They're too. But they they are interrelated. Right. I mean, you're. So one of the things I talked about in in the article is that El Salvador for a while to be, two year, two solid years later this month, has been under what's called the state of exception, which is a suspension of basic protections under the Salvadoran current constitution, so that now you can be picked up by the police, without a warrant without an order for capture, without them observing, you commit a crime. But just because they believe, you know, you were looking nervous, or because they had received a anonymous tip on a on a phone line, you can then be held for 15 days without any charges at all, without having access to a lawyer. 

Tim Muth  
And then you may have, and you're put in prison, the same prison with all the gang members who have been convicted of crimes in the past, there's no separate place where pretrial detainees are held. And so, your exposure to that system is you are much more exposed to that system. And if you are a person of limited means, then if you are a person who has a right, a Bitcoin or who has arrived, and is living in a beach house in El Zonte or above La Libertad. 

Mike Peterson  
Hundred percent. Hundred percent. But you are also previously, when the murder rates were high here, when the crime was out of control. That demographic also didn't face the same dangers that most of the population was facing, too. So it's kind of on both sides of it. Like that's what I tell my tell people is, if I want to be careful how I speak into it, because I haven't experienced it on either side. I wasn't afraid before of my son being you know, assaulted, because in general, tourists were, were left alone, foreigners were not extorted. And so I didn't have to worry about that. 

Mike Peterson  
But I also now don't have to worry about him being you know, held up and being searched by the police and possibly going to jail. It's very unlikely that that's going to happen, but I think for the average Salvadorans, both those risks were very high. Previously, there was very high that they were going to face danger from from the gangs. Now they're exposed to the police, but it seems like the vast majority of them prefer the danger from the police versus the old system.

Tim Muth  
Yeah, I think you make a really important point here. I mean, you and I living here, you know, we had the benefits of, you know, what's called in the United States white privilege, right? I mean, it was foreign or a privilege or whatever kind of privilege it was. But, you know, we lived in private houses, we drove our own cars, we didn't have to rely on on the public transportation system.  

Mike Peterson  
Even there was an unwritten rule against harming foreigners because it'll cause more problems for the gang so it's kind of hands up.

Tim Muth  
Exactly. I mean, at the, you know, in some of the really dangerous years, you know, 2009, 2010, you know, up to 2015, people would ask me, you know, should I travel to El Salvador or do you feel afraid, and I would say, and this was true from 2004. And I haven't kept track recently, but I think it's still true. From 2004, when I started writing El Salvador perspectives till today, the only US citizen with a passport, who I knew being murdered in El Salvador was one guy who was killed by his ex wife. 

Tim Muth  
I mean, it just was not you were not at risk from the in the way that, you know, so many people. I know, tragically, too many Salvadorans who were murdered by the gangs, you know, I've been up beside the casket consoling a mother who, you know, whose son was killed by the gangs. And so, and I spend a lot of time in marginalized communities that were prior get controlled by the gangs in the past. And it is, you know, night and day El Salvador experiences today in those communities in terms of the heavy hand of the gangs being lifted off the off those communities. And, you know, we can't minimize that impact. That is an important impact. And I'm always going to stand on the side of the victims, right. I mean, the government's in the past, we're not doing their job to protect people from the gangs.

Mike Peterson  
I mean people we're afraid to report to the police, because a lot of the police would then tell the gang members.

Tim Muth  
Absolutely, there was that kind of there was a kind of corruption, you had political parties that were willing to pay off the gangs for votes. You know, all of those, all of those things are true and problematic. I think where I differ from the current government is that you are also a victim if you are an innocent person who has been picked up and thrown into the hell holes, which are Salvadoran prisons, right. And without a system for due process and getting separating the guilty from the innocent in any meaningful way right now.

Mike Peterson  
So I would love to spend some time on this and delve into it, because it's something that I've thought a lot about. Because I struggled with it, too. It's like, you know, for sure that there is innocent people in the jail. But even the concept of innocent like, what does that mean? Because it was so messy here, even in a scene in El Zonte, there was the gang members, there was the like helpers of the gangs that were like seen as friendly, that would serve as lookouts, there was all these different levels. Some of them were forced into the gangs. And so it's like, do you hold them culpable? Because they were forced into the gang. 

Mike Peterson  
At the same time, it was like the 12, 13 year olds that were the trigger man a lot of times and I would hear these stories from my kids growing up in this community. They knew way more that was going on than I did. And so I feel like even if you were to take all of the gang members that have been arrested and put them through a US style judicial trials, you 90 plus percent of them wouldn't be able to be convicted because you wouldn't have that beyond a shadow of a doubt. People wouldn't be willing to testify against them, you wouldn't have that. 

Mike Peterson  
So the majority of them would have to go free during that, even though most of them you know, they have the tattoos, they have the other things. So how would you, Bukele did what people said was impossible even when that first happened, everybody thought I mean, and then when we met a couple years ago, you said, well, let's see, you know, other governments have talked about this, but it never really works out. Well, obviously, we're, you know, we're still in the middle of it, but it's looking like this is becoming more and more permanent. 

Mike Peterson  
So in such a messy situation where such a huge portion of the population was involved in the gangs, how do you kind of cut the legs out from underneath without having this kind of broad round up anybody with tattoos, anybody affiliated, you're just because what it's done is it used to be kind of cool to join the gang. So it was like, you know, you got credit, if you were in the gang, there was not much downside. So you had probably 10 to 20,000 young people every year entering the gangs, basically throwing their lives away. 

Mike Peterson  
Now, that pipeline has been cut out, nobody wants anything to do with the gangs, they don't want any association. It used to be there was benefits to have an association. Now, the negatives weigh out way. And so not only do we have less people being murdered, we have tens of thousands of young people being saved from that way of life, but as a cost of having it done in such a messy way. But do you think there is another way that it could have been accomplished?

Tim Muth  
I think history is going to have to tell us that I mean, what Bukele's approach was really an acknowledgement of how, I don't know if incompetent is the right word, but how ineffective the criminal justice system was in this country.

Mike Peterson  
Well, this one was just so endemic. It was so intertwined everywhere.

Tim Muth  
Well, only like 5% of murders were ever solved, right? Or ever led to somebody being convicted and imprisoned. I mean, that's how poor the government was at being able to, to investigate and handle murders. I mean, so essentially.

Mike Peterson  
But a part of that was that nobody wanted to testify, because we would see that here, there'd be people are like, no, I'm not testifying, because if you testify, they're gonna kill you, they're gonna kill your family members and so.

Tim Muth  
Right. Because the, you know, the government had no way to protect witnesses, all of those kinds of things. So you've had that. So essentially, the state of exception is sort of saying, so we're going to lower the bar so far down that basically, you know, it's, if you are associated with the gang, will put you away for 30 years, right? I mean, that's essentially, you know, we're not going to worry about proving murderers or extortions or any individual crimes, it will be enough to say you are, you are a member of a gang. 

Tim Muth  
And of course, that sweeps up people who are, as you said, made themselves sort of be victims, you know, that they weren't collaborators, or they were somebody who would, you know, in a little three wheeled scooter, you know, transport gang members from one place to another, because if not, their sister was gonna get raped. But, you know, so they were doing that, you know, are they a collaborator. are they are they a victim. Right now, the government is saying, you're a collaborator and you're in prison. You know, in El Salvador, we are where we are, right? I mean, and but let's look for a way to, you know, to distinguish that people in prison and make those kinds of determinations.

Tim Muth  
But how would you? I mean, I know even people here in El Zonte that like, I'd never would have thought were involved and you talk to other people. So if you're in a town, you could have even people that know the people disagree whether or not they were involved. How is the judicial system that's far removed, that knows none of the background story and just has very limited reports. Like, how would you even make those decisions on who is guilty and who's not other than like, hey, you have the tattoos, you're obviously we're part of the gang life, you're going to jail.

Tim Muth  
I think you can't give up on trying. You know, I mean, I think that's, I mean, the government has bought into the, you know, it's one. I mean, the government's narrative is, you know, we make very few mistakes, and we've got all the all the right people in there. And so there's not much acknowledgement of that possibility. I think you have to, at least try to create a system, it may not work and may not be appropriate that it be a system that involves jury trials, and, you know, all the trappings of you know, that the United States, for example, can afford in its judicial system. But right now, you have a government that doesn't really seem to even be attempting to have a process to select the amount.

Mike Peterson  
I mean, I know that they've said that they've released thousands. Obviously, I don't know, the dailies, you know, action as far as that goes. And we, I think, would be an agreement of going forward of what should be done. I'm curious as your thought was, was their initial, like, overwhelming force going and round up everybody the correct way to do it, even acknowledging that there was collateral damage, because I have a hard time with it. But I just I don't think you could have cut the legs out from underneath it. The way they were doing it before they would recruit new gang members faster than they could arrest them. And so I don't know. It's almost like a wartime scenario where you have to go in with this overwhelming force and then clean it up later. But I don't know, if you have a different take on that.

Tim Muth  
You know, I am not an expert in policing, and knowing was there a better way. I don't see myself saying, you know, it's fine to, you know, pick up, you know, I know, people who I'm very certain are innocent people, you know, I know, their I know, their families, I you know, I know how hard this kid worked to stay out of the gangs. And yet, they're in prison. And, you know, I can't say sweeping that young man up in this was, you know, was ever going to be going to beat be justified. 

Tim Muth  
That being said, you know, it is this, we can't deny that, you know, in communities all across the country, people are feeling safer. That is an important thing to acknowledge in these discussions. But the other thing you're doing is also putting people who, if you're going to acknowledge that, yes, we are sweeping up some innocent people as well, then you've got a moral and other obligation to make a serious attempt one to, to find ways to separate the innocent and get them released, but also not to violate their human rights while you are incarcerating them. 

Tim Muth  
I mean, remember that the bulk of these 75,000 plus people who have been arrested, have not yet even been convicted of being gang members. Right. They're being held pretrial. I'm not sure that there have been any trials as such as understood in the Salvadoran criminal justice system. I mean, these people are still going to be tried eventually.

Mike Peterson  
I don't know if they've been trial. I know there's been releases.

Tim Muth  
There have been some releases that relate to, you know, pressure by community groups or lawyers or you know that there are plenty of good upstanding people within the within the police department who, you know, will say, look, I was the community police officer in this area, and I know this young person, and, you know, and we'll, you know, help in that kind of way, where, you know, a person with the right connections and other kinds of things may be, you know, may or may be released.

Mike Peterson  
So question for you. If they gave you the lever and said, Tim, you can pull the lever and release all the people that were swept up in this and haven't been tried yet. Would you pull that lever and release them?

Tim Muth  
What? All 70,000 people? No, there are, there are plenty of people for whom there is no proof that they were engaged in criminal activity and our danger to their community and others who ought to be held pending, you know, pending a trial.

Mike Peterson  
But do you think there should be the trial, getting back to what El Salvadorians, like trial based on, you know, beyond reasonable doubt, because most of those would go free in that style of trial, like the purpose of a penal system is twofold. One is to bring justice for people who have been perpetrated crimes, but it's also as a deterrence to deter people from committing crimes. And so do you think in this messy, complicated situation, that it might be more beneficial for society as a whole to say, hey, we're never going to be able to figure this out person by person. But now we've set this deterrence in place. The majority of these people, even if you knew all the facts, half the people would say that they were innocent half would say they're guilty, because it's just messy. They were kind of forced to do it. But then they became perpetrators.

Tim Muth  
As the mother of the young person who's imprisoned in in that hellhole who, you know, she spent 17 years doing everything she could to keep him out of the gangs. And now, she's been deprived of her child and hasn't been had able to have it. 

Mike Peterson  
Even a lot of those mothers would, and I've talked to these people who have family members in jail, they still are not against the state of exception. They think their family member was wrongly picked up. But they still are for the security measures as a whole, even with that fact, which is surprising to me. I'm always shocked by that. But they say no, I'm for what Bukele's doing. But my brother is innocent. And we need to get him out of there. 

Tim Muth  
Yeah. And I think if you ask people to drill down. I mean, there was a poll by the University of Central America and asking people, are you in favor of the state of exception and the war on gangs? And yeah, broadly, you know, it's 90%. But when you ask, like, are you in favor of the presumption of innocence? Or are you in favor of, you know, individual things that are suspended? So, you know, so there are these complicated questions about, you know, the criminal justice system. 

Tim Muth  
And the other thing about the state of exception, and this kind of gets back to our maybe it is too simplistic to say El Salvador is the land of freedom or liberty. But the state of exception applies to being picked up for anything, you know, not just for being picked up as a gang member. And so, you know, there is the example of six activists in Cabanas Department very involved in activism against gold mining in the area and protection of water and they were picked up and charged with being involved in a woman who was killed in I think it's like 1980 or 1978, during the war conflict. 

Tim Muth  
And they were held under this state of exception for more than a year with a very large international campaign to get them relief, because the, you know, the the proof of their having any connection with it was very, very limited. And the irony of this is that the military colonels and generals, who are clearly responsible for giving the order for massacres of women and children at El Mozote, are being processed, you know, outside, you know, they are allowed to live there, you know, aging years it in freedom, not, you know, not being held. 

Tim Muth  
But these water activists who, you know, the strong suspicion is that the government is showing this is what can happen to you, if you get too involved in political activism against something that, you know, we, as the government may want to do. So, one of the issues is that, you know, the state of exception is held out as this tool against the gangs, but it can also be used against political opponents, people who are just, you know, it's a little bit too uncomfortable for the things that they are saying about the government.

Mike Peterson  
No, I'm definitely, like I said, I've wrestled through these things. But you know, the longer this goes on the more I feel like, okay, it's time to, to end the state of exception.

Tim Muth  
It does seem a little bit weird to say that we're in El Salvador, and there's a state of emergency and at the same time, the President saying this is the safest country in the Western Hemisphere. Well, then, what's the ongoing emergency that justifies suspending all of these constitutional rights?

Mike Peterson  
Yeah, no, I, I'm with you there. I think that's something to wrestle through. Some of the other things you addressed in the article was along the freedom line was how Salvador had dealt with COVID.

Tim Muth  
Oh, sure. Yeah. I that I think was one of the things sick. You know, gave me more of a chuckle in sort of, some of these folks don't know, a whole lot of, you know, the El Salvador's recent history and the way, you know, when, when COVID struck the very strong lockdown that El Salvador imposed. I mean, you you were here, or maybe you like, and you know, so when only one family member can leave the household and only to go to certain places, and if not, you could be put in a contention center. And there wasn't any due process with that, right. It was locked up away. 

Tim Muth  
And when too many people were in adjoining the beach area in Puerto Libertad, have a military siege of the whole things, or the Salvadorans who are stranded outside of the country and not allowed to come back to the country during the lockdown.

Mike Peterson  
No my friends had classmates that like their mom flew to Miami to go shopping for the weekend. And I was like, stuck there for six months.

Tim Muth  
So it makes me laugh, you know, to sort of hear some of these people who who arrive and can I call them Bitcoiners. Anyway, whoever they, you know, whatever they are.

Mike Peterson  
But other than that, they weren't here during that time they didn't experience it. And I was a vocal critic. And the ironic thing was these procedures were very popular. I mean, people in general were very much for them. I mean, I felt like I was the only one saying this is crazy, but they were I mean, we had here on the coast, people were cutting down palm trees so that people couldn't cross the road. They were. I remember when people were, they were hiring coyotes to sneak them back in and people were online saying they should shoot them if they crossed the border illegally, that's kind of ironic, considering the history of El Salvador, but they were, with the general public, we're very popular. 

Tim Muth  
I mean, there's I think, you know, a love of the sort of the strong man figure for running the president. Bukele was, you know, certainly portraying himself out not just portraying he was acting as though he was strong man.

Mike Peterson  
He saw that was the worldwide at that time, it was popular to come very harsh. But he also turned things around much quicker than most countries did. He loosened things up quicker. He got rid of the one thing that killed me was how long I kept the schools closed. But the other things that they did, you know, they're one of the first countries to open back up. They did a lot of the right things coming out of it, but coming into it. No, they were definitely very strict.

Tim Muth  
Right. Because these schools, you know, for 2020, all of 2021 were all online, then 2022 was half and half, right half online and half in person.

Mike Peterson  
I remember I had to take my daughter in the middle of the night, she had some some issue with her eye, we had to go to the hospital diagnostico in the middle of the night, and we're leaving there like two in the morning, we drive by and there's the strip club there. And it's like, full of cars. And I was so irate. I'm like we still have the schools close, but the strip clubs are open, like, what's wrong with our priorities here. So that was definitely I felt like they handled that part poorly, the educational component. The other things, they opened back up, and I felt like did a better job than other places.

Tim Muth  
Yeah. And I think, you know, I've written with sort of that there were a lot of things that I thought the Salvadoran government did well, during the management of COVID. They went over overboard on some of these lockdown things but a lot of the public health messaging and different ways that they dealt with it pandemic or solid, I think the the point I sort of want to make here about is you know, the level of freedom or liberty in El Salvador is that those powers that Nayib Bukele exercised during that time, are not ones that in any way, shape or form he has renounced as something that he doesn't have going forward if he needs to exercise them.

Mike Peterson  
But in all fairness, no other governments that went overboard have either, so.

Tim Muth  
That's right. But people are saying, you know, we're fleeing those other governments to find our level of freedom here in El Salvador.

Mike Peterson  
I think specifically around like there was no COVID vaccine mandate here, which I think was for a lot of people was, especially a lot of Canadians was something that they were fleeing, so they were maybe, they didn't see the first part of it, but they saw how those things were being handled later on. And it fit with what they were looking for. But I agree with you, I think there is, you know, it's it's maybe not being a little just seen the plus sides and not the negatives.

Tim Muth  
Yeah, so I think you know, there are you know, so there are those issues. You know, I think I mean, if we talk about Chivo wallet I'm gonna guess you weren't, you weren't a fan of it.

Mike Peterson  
I was actually not against it in principle, I am not against there, you know, as long as there's other alternatives and that people could choose the wallets that they would would use but the way they've done things and rolled things out, it's they've been it's been a fiasco and so I wanted it to succeed. I wanted it to work. 

Tim Muth  
But you know, my one of my biggest concerns about Chivo wallet was the privacy aspect of it. Did you want the government of El Salvador to know every single transaction were you were doing? Because that's what you were giving. If you adopted Chivo wallet. And you know that, I think that goes to show that Bukele hasn't bought into all of the values that the Bitcoin community expanded.

Mike Peterson  
I think you could look at it that way. I think it could be just a pragmatism there were, he was getting pushed by the US government, but IMF that this is going to facilitate all kinds of money laundering and terrorist financing. And so there was an extent that they had to do KYC, AML procedures. If they were going to do any type of wallet that they were involved with. And so I don't think that there was a way for them to really get around with that. 

Mike Peterson  
The other thing from talking to the people I know in the space, and that actually was very prevalent with Chivo is companies have to KYC, AML, because of the fraud issues, and there's so much online fraud, that if they don't do that, they just get ripped off right and left like the Salvadoran government did with the $30 that they did. So I'm not in favor of it by any means. But I don't necessarily think that I think they thought maybe their hands were tied that this was just came with the territory, so. 

Tim Muth  
Yeah, but I mean, I think it's interesting that you're so willing to give the government about so.

Mike Peterson  
I don't use the Chivo wallet, right. So yeah. But

Tim Muth  
I think, you know, I think we need to be, as you know, as concerned and doubting about the bona fides of you know, what this government would do with a bunch of the data. In the same way that if you get a phone or a Salvadoran cell phone, the amount of data that your cell phone company is required to get from you when you sign up, and then give to the government about the person who holds this particular phone number. It's another privacy violation.

Mike Peterson  
I agree. But a lot of that stuff is stuff that's pushed by the US government, because they claim that oh, if you don't do this, there's terrorism financing. There's all these different things that go along with that. So it's, I know for sure, on the financial side, from talking to people in the banking system here, majority of that stuff is done to not get gray listed by the US government and kicked off the SWIFT system like that is the biggest fear of what's happening. Now, that's not to say that they're not using this data for other stuff. I don't know. I'm always suspicious. Anybody that wants my data.

Tim Muth  
And should we have systems against terrorism financing?

Mike Peterson  
I don't think so. Because they're not effective. That's the reality. KYC, AML policies that the terrorists and the criminals, they always find a way around them. But what it does is cause the majority of the people in the world to remain outside of the financial system, because it costs too much for the companies to KYC and AML. Poor people. And so they just exclude them. And so what we've done is we've marginalized half the world, and the terrorists and the criminals find a way that they always find a way to make it happen. I mean, that's, that's the reality. 

Mike Peterson  
And so theory, it sounds good, but in practice, I mean, they did when they looked at, I think it was the fact the law that they passed in the US and it was going to raise, I don't know, hundreds of billions of dollars in taxes and whatever. They finally came out and looked, it was $100 in cost for every dollar that they recouped in taxes, and those costs were borne by all the banks. So what the banks did around the world, they just said, if you're American, we don't want to you as a customer anymore. So it's those unintended consequences that kind of ripple out. And that's why, you know, obviously, I'm not for terrorism financing, but I don't want to make a billion people stay impoverished because we might stop one transaction from growing through that they're gonna find another way. I mean, yeah, that's the reality.

Tim Muth  
And I could complete agreement about the need to reduce transaction costs and to streamline and to the extent FinTech makes that easier and faster and lowers transaction costs and lowers barriers to entry so that people can be bad.

Mike Peterson  
Do you have a bank account here? How have you found using the banking system here?

Tim Muth  
It's better now than it was. Right. But no, it's a pain in there. You know?

Mike Peterson  
I don't have the patience for it.

Tim Muth  
I mean, I've experienced that there's more and more stuff that is now able to be done. Online in ways that didn't used to be I mean, some of the online payment systems are getting better. But I also recognize that, you know, I've got a set of skills in terms of working through an online banking system that your average vendor of Papoose says does not have, right. And so, but yes, I mean, there's no doubt that El Salvador has. 

Tim Muth  
And I give credit to the Bukele government, because I do think that they are managing to reduce some of the levels of red tape and hassles in engaging in a lot of different kinds of activities that before, you know, took multiple stupid trips to stupid agencies where you would sit in a long line and waste half of your day, just to find that you needed a different signature with a rubber stamp seal.

Mike Peterson  
It was almost like they wanted to find a reason to say no, because they're afraid of they said, yes, they might get in trouble. And so even if they told you, you needed this, this and this, then they would come up like oh, but you don't have that. It was like this weird. I was just like, but I feel like that's gotten much better. Now, I feel like stuff, actually. Now when I go back to California and try to do stuff there. I'm sometimes feel like, oh, I feel like El Salvador. But the work gets done faster than it does here. 

Mike Peterson  
So would you say, I know you've always been a very vocal critic of the president. But would you say that overall that the direction of El Salvador has gone in the last five years has been a positive one? Or do you feel like they're going backwards? Or what's your assessment of El Salvador right now?

Tim Muth  
So there are multiple different directions. Right. I mean, in terms of the rule, the rule of law in the country, I think it's, you know, going in the wrong direction. I mean, it is simply the case, that El Salvador's constitution, and it's not even close in multiple places said that the President, you know, can't be reelected. And, you know, despite that, he ran for for reelection, how did he get to do that? And his party on May 1 of 2021, fired the existing constitutional chamber and put in five allies. There is a very explicit description in the constitution of how you elect and put in place magistrates, so the constitutional chamber, it was not followed. And so we have a government right now.

Mike Peterson  
It was followed, but under unusual procedures, they had enough votes to, to basically impeach or to throw out the existing.

Tim Muth  
Well, so there are two parts. So getting rid of the existing constitutional chamber. I mean, there was remember, I mean, it's a process that you impeach them within you know, in three hours, or four hours on that night, without any evidence or proof of any wrongdoing by the existing constitutional chamber other than a dislike.

Mike Peterson  
But they had the vote there. They had the votes to do that.

Tim Muth  
They had the votes, but the Constitution says on what basis you can.

Mike Peterson  
And they had a basis on the people vote whether or not you think that was a valid basis, there was a procedure that they followed. Now, what? Were they pushing the envelope? Maybe. But there was there was a procedure to get rid of them. And they followed that because they had the votes, just the same way that the Democrats or the Republicans would stack the Supreme Court in the US if they had 90% of the Senate and the house. 

Tim Muth  
Right. So you have the votes, but the votes, say, you know, you have the Constitution says, you know, there are certain reasons that you can remove for and there was never any introduction of here is the evidence that those reasons existed. But despite that they voted. And then the Constitution says, to put people on the constitutional chamber they need to come from a list from the Judicial Council. I don't remember the exact name of the bodies that provide the list of qualified persons. That process was completely ignored. I mean, they're 10 minutes after you've impeached the other ones, you are electing five new five new people. Clearly, there was not a lot of discussion, debate, analysis, evaluation of the credentials of the five people that were put.

Mike Peterson  
But anytime one party has that degree of supermajority, whether it's in the system here, system in the US, though, those type of things happen. I mean, that's that's the way politics plays out.

Tim Muth  
That doesn't mean that I can't critique it. And Salvadorans can't critique it as this is, yes, you play pure power politics. And by the way, that violates you know, what our constitution says, to which the players who have the power say, yeah, but who's going to tell us we can't and that's what's going on now in El Salvador. So the rule of law, suspending, you know, the constitution for two straight years now, and saying that there is an emergency that, you know, has long since passed, since the president tells us this is the safest country in the in the Americas.

Mike Peterson  
I mean, I I agree with you, but I do think you could make an argument that this has been so recent that they need to make sure cemented in place, because it could easily reverse itself. And so, I think there's an argument that this needs to be seen through and they don't want to short step it now, I wouldn't make that argument, but I, I think there's at least some validity for it.

Tim Muth  
I think, you know, anybody. Those are after the fact kind of justifications people at the time would say, would have said, you know, these are, you know, these are for emergencies, these are for the system. The system is under attack right now. You know, there's mainly a section to deal with natural disasters, and it was used during the pandemic, yeah, and different kinds of things. But right now, you know, the police are not being shut by the gangs. The people are not being extorted, people are not being murdered. So where's the state of emergency that requires. 

Tim Muth  
So yes, my analysis of the country so you have that one piece. The second piece  I would say you know, is the lack of transparency by by this government. They're declaring so much public information about how taxpayers money gets used spent, even the number of people who were hospitalized with COVID, or the number of tests that were being used or the national plan of health, or even. 

Tim Muth  
And I was really troubled by this, there was an audit report done of the Internet voting that the Supreme Electoral Tribunal has said, no, that's confidential information that can't be disclosed whether there were any problems with the Internet voting system. So I know you guys like to say trust, but verify. Well, you can't verify if the government won't give you any access to information. What's the proof that the government has bought the number of bitcoins that exist?

Mike Peterson  
Yeah, other than, if you say that you've done it, and then you haven't, it's gonna look really bad, like, for you when it comes out so I don't why they would make the claim if it wasn't true.

Tim Muth  
Why not disclose the address of where the Bitcoin are? I mean, is there even a pattern of a single bitcoin address doing one a day every day since?

Mike Peterson  
I mean, the, you know, the different rumors were that it was custody by some firm in the US, which has its own, you know, problems and criticism within the specifically within the Bitcoin space, if that's happening, but yeah, there's but there's lots of, you know.

Tim Muth  
How much money has the government spent on operating the Chivo wallet system? We have no idea. How much money in the 150 million dollar trust fund that was set up at the time to back the interchangeability of dollars to Bitcoin and back and back and forth, you know, what's the status of that? When the President said, the chief of huts hospital was built with Bitcoin profits, but says he's never sold a single Bitcoin, how does that work?

Mike Peterson  
Yeah, I mean, I think that was more of a just like, I think at that time, their Bitcoin earnings were up. And so it was, it was.

Tim Muth  
So that's the thing, right? I mean, there is so much or non transparency by this government.

Mike Peterson  
There's this politics and there's, I mean, that's unfortunately, that's the norm and in general, but if you look at the numbers overall they, for the amount of money that they've spent on the Bitcoin investment, versus the amount of investment and tourism and everything that's brought in, it's a winner. So it's not that they're not just. I don't know what that system was before, and what they disclosed, what the government disclosed on what how all that works. So I don't know if this is any different or if it's the same, but.

Tim Muth  
I would say my experience, you know, because I could actually make, you know, public information requests sending in an email to a different government body, just as, you know, blogger based in the US, and I get responses. I mean, I didn't think very much of the FMLN government under Sanchez Saran, but the one thing they did do was sort of open government and respond to a request for information. 

Tim Muth  
The other thing that really happened with the Bukele government was the websites of the different government agencies used to be sources of information about, about things that were going on, or information in a statistics about the travel by the minister or, but they were sources of information. Now they're sources of publicity. The websites are all branded in a particular way. And they are all about portraying the great things that the government is doing, as opposed to providing needed information about the number of people who are hospitalized, or the number of pupils who dropped out of the school system last year, for example. 

Tim Muth  
So I mean, that's really, really troubling, because, you know, for the democracy to work for, for a president to be able to celebrate, you know, that he had 80% approval, it had better be based on the people having access to actual information, as opposed to a bit of a people having to only get their information from the government propaganda sources.

Mike Peterson  
Yeah, but I think most people, I mean, maybe you and I are gonna go to those sources. But most people just they respond, how they feel in their daily life. They're not researching those things. And I think, in general, I think the vast majority of Salvadorans feel like life is significantly better now than it was five years ago. And they're much more proud to be Salvadorans, and they have much more hope in the future.

Tim Muth  
That is true, and it is, I don't remember when I wrote this particular column, but, you know, it was an important change that, to see in public opinion polls, Salvadorans optimism about the country, and that's important and shouldn't be, you know, that shouldn't be denied. And, you know, to have a greater, I think, you know, those of us who, you know, study history and have a longer perspective, you know, we'll say, that's great. We, this story, tends to have a bad ending, when one person has all the power. I mean, populist, autocrats, start with very large election victories, that's what almost what it means to be to be a populist. 

Tim Muth  
But eventually, the chickens come home to roost, and they use these different tools that have, you know, like a state of exception, like their control and domination of the police and the armed forces and other things, to stay in power, long term, and absent, you know, the tools that you know, democratic institutions have built up over time of checks and balances of an independent judiciary of alternation, changing power term limits, those kinds of things. Absent those things being in place. Autocrats tend to get more autocratic and that would be my concern.

Mike Peterson  
You do have like, samples like Singapore, you know, the leaders had those same criticisms, but most people now would look back and say, it took this backward backwater country into being a very developed and first world but I, I think we're in general facing I don't know if you're, if you're familiar with Neil House work at all, he wrote the fourth turning.

Tim Muth  
I've heard of it. I haven't read it.

Mike Peterson  
He does a lot of stuff with just generational trends. And you know, one of the things he's saying is it, he would say we're in a fourth turning and in a fourth turning people want, they tend to be attracted to populist leaders that it's a time where people demand more order out of life. And I think in general, you're saying in Latin America, there's a democracy isn't held in high esteem by the general populace. I think there's a sense that democracy has failed Latin America. And so I think that I don't agree with that. But I think that is a general sentiment. And so I think that it's, it's going to be an interesting next 10 years to see how how things play, play out just in the region.

Tim Muth  
Yeah. And I think it's important, you know, for voices to continue to, you know, express those concerns and stuff in there.

Mike Peterson  
We always need critics, you know, we don't need any censorship, we need critics.

Tim Muth  
Right. And there are, you know, a lot of really, you know, brave Salvadorans out there, both independent journalists and people in human rights organizations, and others who, you know, despite the criticism and stuff that they will get from the powers that be in this country, you know, want to point out that need for democracy and checks and balances and that try to make that education for people so that they understand the value of some of these institutions that have been built up over time.

Mike Peterson  
But they have not been working for them. I mean, it has been absolutely disastrous.

Tim Muth  
The fact that El Salvador's democracy fail, you know, failed in many ways, does not mean you give up on the Democratic project. That, look, who knows stoles hundreds of millions Saca stole hundreds of millions governments negotiated with gangs. There was plenty of corruption. Absolutely. But I don't think if you study single party systems, that you would be able to say that on balance, they tend to be honest and non corrupt.

Mike Peterson  
No, I agree. I agree. I mean, from what I've seen so far, I'm hopeful. But I know those things can change over time. And yeah, but I, having lived here for a long time, I would say, it just feels like a very different country. Even my kids grew up and even talking with my kids about the issues they're dealing with now from growing up here, the number of dead bodies they've seen the, really the PTSD that they have from the things that they experienced. 

Mike Peterson  
And then talking to people who've only lived here for a year or two and just realizing what a different world is. It makes it hard for me not to be very optimistic about the direction holding in all the concerns that we've mentioned. But optimist about the momentum, and just the general sense of national pride and like, people want to stay in El Salvador now. And they're building businesses here. And every flight I take the number of people coming back who haven't been in El Salvador for 20 years that are coming back.

Tim Muth  
Yeah, I mean, I that's both yes and no. I spent a bunch of time out in some rural communities in the eastern part of the country in January. And in a couple of different communities that both told me that that more people had left in recent months than in the previous year. And largely poverty related and a belief still in. And believe me, it frequently doesn't occur. They don't achieve the quote and quote, American dream, trying to cross in into the United States, but that, you know, and what, what they said is that the President talks about and they acknowledged and they were thankful for the reduction in gang presence and stuff in their communities. 

Tim Muth  
They weren't denying that and they said, we are happy that Bukele did that. But they were also saying that the President talks about Development and stuff. But, you know, we aren't seeing that maybe that happens along the coast they said. But here in the interior of Cuscatlan and San Miguel, you know, we're not better off things costs more. And it is really hard. And so I think there are people, and it's why the polls say that, you know, now, the number one concern people have is, you know, is the economy and the high cost of living and employment.

Mike Peterson  
Well, I think we've seen I mean, the, from the stats, I saw that the immigration was down 50% last year from the prior year. So that was a significant reduction.

Tim Muth  
So I have the stats. So in the last three years, I mean, and the only way we have stats is really the number of people already handed to us. So the actual number is higher because there are people who are not quite, but 280, 700 over the last three years. So that's 2021, 2022, 2023. 69,000, what's the number in 2023 down from 88, 000 n 2022. So 90 is about a 20%, drop. 

Mike Peterson  
Something this 60 was what I had seen.

Tim Muth  
That's if you're doing sort of US fiscal years, which, you know, and like September 30, or whatever. So, those were counted.

Mike Peterson  
I think you have to keep in mind that all the other countries have seen a huge increase at that time. So the number of Hondurans, the number of Nicaraguans, the number of Guatemalans have gone up during that time.

Tim Muth  
That's not true for Honduras. Honduras pattern also went down. Guatemala, El Salvador, and Honduras generally follow a pretty similar pattern. Guatemala has diverged from that. It's there was 220,000 Guatemalans in 2023, you know, compared to 70,000 Salvadorans, but I'd have to look at the relative populations. I think Guatemala is what? Twice the population?

Mike Peterson  
Yeah. More than double.

Mike Peterson  
I mean, I'm talking about from compared to prior years, we'll say Salvador used to be one of the highest, because I know even while even talking to people at the US Embassy, they were I can't remember her name. But the prior acting Ambassador that paid a bit Bukele. They basically, from my understanding pushed her out because they wanted friendly, friendly relationships with El Salvador, because Bukele was reducing immigration. And that's, that is the US Embassy is number one goal in El Salvador is reducing immigration. 

Tim Muth  
It is true that the US has this single focus on US, El Salvador relations now, which seems to be beat migration. But one thing I mean, if you look over sort of the last 15 year period, and I've got the sets, I mean, Bukele's years in office in if you add up his five, five years, where the highest five years of prior presidential terms, I mean, the numbers of 90,000 a year in fiscal year now, it is true that 2023 the numbers came down through June of 2023. They steadily increased July through November of 2023. December and January have been down a little bit. And they always go down around the holidays. We'll see your February numbers.

Mike Peterson  
And it's complicated things too, because a lot of it depends with how prevalent jobs are in the US how easy they're hearing it is to the cross or not crossed in the US. And so there's a lot of different factors.

Tim Muth  
Yeah. So people are still leaving. I mean, we'll see where the where the trends are going. The last two months went down. Do they go back up? Or we'll see. And I tend to think that migration will help, migration will continue to decline. For the reasons you've talked about people's optimism about the country.

Mike Peterson  
Take a while to play out. But I bet five years ago, you wouldn't have believed if somebody told you people would pay a million dollars for a Salvadoran passport.

Tim Muth  
There's a sucker born every day.

Mike Peterson  
We'll see. My theory is they're going to sell enough passports to pay off the IMF debt this year.

Tim Muth  
Let me just say that there were an awful lot of people who, for some reason, thought there was going to be a Bitcoin bond in the way that Bukele described it that made no economic sense at all. Or that thought there was going to be a Bitcoin city. I mean, he can sell a lot of snake oil.

Mike Peterson  
I think, well, I was never betting on the Bitcoin city. But I wouldn't count it out. I think some of these long term projects, I mean, these things take a long time to play out.

Mike Peterson  
But I do know that I sat down and did a podcast here two weeks ago with the head of Tether. And this is a company that's making billions of dollars a year. And El Salvador is their primary focus, like they see potential to turn El Salvador into a financial powerhouse for the region so and they're not alone. So I think that these things, I think people will be shocked five years from now to see the changes that are coming. Well, I appreciate you coming down. And I hope this doesn't mean that we can't still trade barbs on Twitter, because I would miss that. Just because we're friendly here doesn't mean we can't criticize each other on Twitter.

Tim Muth  
That's right. And if you know the people who watch live from Bitcoin beach, you don't want to get an alternative point of view.

Mike Peterson  
Oh yeah we need to make sure. Can you put that up.

Tim Muth  
It's at elsalvadorperspectives.com. It's easy to find. And then there we go.

Tim Muth  
And my Twitter handle, just @TimMuth.

Mike Peterson  
You're pretty prolific writer. How often do you publish?

Tim Muth  
I tried to do about 10 per month. It kind of depends on you know, what other things are busy.

Mike Peterson  
Yeah. You've written I've read a lot of interesting stuff over the years. I don't agree with it all, but a lot of interesting stuff.

Tim Muth  
That's right. I don't agree with everything. Well, I'm glad we could do it simply in this way, and hope we can do it.

Mike Peterson  
No, I think these are the things that need to get hashed out. And it's good to have discourse. I'm pro discourse. I think it's always beneficial to me, you know, a lot of times it's not even that you disagree with things. It's just life's complicated and things are messy. It's okay to admit that. Well, thank you, Tim.

Tim Muth  
Thank you, Mike.