It would appear that your pycurl installation (or curl library) is damaged somehow. From the curl error codes documentation:
CURLE_FAILED_INIT (2)
Very early initialization code failed. This is likely to be an internal error or problem.
You will possibly need to re-install or recompile curl or pycurl.
However, to do a simple POST request like you're doing, you can actually use python's "urllib" instead of CURL:
import urllib
postdata = urllib.urlencode(data)
resp = urllib.urlopen('https://www.sandbox.paypal.com/cgi-bin/webscr', data=postdata)
# resp is a file-like object, which means you can iterate it,
# or read the whole thing into a string
output = resp.read()
# resp.code returns the HTTP response code
print resp.code # 200
# resp has other useful data, .info() returns a httplib.HTTPMessage
http_message = resp.info()
print http_message['content-length'] # '1536' or the like
print http_message.type # 'text/html' or the like
print http_message.typeheader # 'text/html; charset=UTF-8' or the like
# Make sure to close
resp.close()
to open an https://
URL, you may need to install PyOpenSSL:
http://pypi.python.org/pypi/pyOpenSSL
Some distibutions include this, others provide it as an extra package right through your favorite package manager.
Edit: Have you called pycurl.global_init() yet? I still recommend urllib/urllib2 where possible, as your script will be more easily moved to other systems.