you have an old version of pip installed locally:
 File "/usr/local/bin/pip", line 5, in <module>

remove this installation so that it does not interfere with the packaged 
version (which is 1.0)
maybe removing the packaged version might work too.

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https://bugs.launchpad.net/bugs/874417

Title:
  pip command line fails immediately - can't use

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