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Follow the (Merida) money

29 June 2008

WOLA (Washington Office on Latin America), a group I’m not familiar with posted this about the $400 million “Meridia Iniative” package that’s been approved by the United States Congress:

The bill’s language recognizes the “shared responsibility between the United States and Mexico to combat drug trafficking and related violence and organized crime.” It’s good to see the U.S. Congress accept that fact, but Mérida is definitely a mixed bag and, in some ways, a missed opportunity for the United States to finally start getting it right on fighting drugs.  It has some positive things — $3 million in technical assistance to help Mexico establish a unified national police registry, $10 million for drug demand reduction and rehabilitation in Mexico — but a lot of misguided spending on military hardware ranging from helicopters to surveillance systems to aircraft platforms. And it doesn’t address at all the critical need for drug demand reduction in the United States and controls on the smuggling of firearms over the border into Mexico from  the United States. These are the twin traffics — drugs into the United States, guns into Mexico — that threaten to erase any chance Merida has of succeeding even before it starts.

I’m not sure a national police registry is a good thing. Most of this funding is simply a boondoggle for U.S. equipment suppliers, throwing a lot of money and equipment at one particular crime issue. Since narcotics smugglers really don’t affect day to day life for most people in Mexico, making anti-narcotics efforts the focus of so much attention detracts from what are probably more important — and, in the long run, permanent — reforms: better pay and training for the police, better record-keeping for the judiciary, more judges and courtrooms.

And, I know this is a controversial point, but what’s wrong with bringing in money from the trans-shipment of narcotics to the United States?   Money is fungible.  The source, within a few generations at most  becomes the stuff of legends and only of minor interest to anyone but conspiracy theorists.  I hope I’m wrong, but this is only a “problem” when the gangsters are “not-us” selling to “us”.  I’m not sure if that’s a class or race issue, or just human nature:  when Indians killed settlers on the frontier, it was a “massacre”; when settlers killed Indians, it was a “battle”.

Most of the resources on the Opium Wars that talk about the British fortunes made from 19th century British investments in the China opium trade are, alas, from the wacky Lyndon LaRouche people, but there’s a lesson there. Money has no morals… and eventually becomes “respectable” after a period of time. A lot of major corporations and family fortunes got their start in the opium biz. My bank is HSBC, which started life laundering British opium smuggling profits. The Bush family’s ties to Hitler m ay be controversial, but Barbara Pierce Bush’s family fortune came from the opium trade (and out of fairness, so did some of Franklin Roosevelt’s mother’s family money) too… while I don’t think they’re a respectable family, I haven’t heard any complaints about the fact that they had money to invest. It took less than a generation for the Kennedy family of Massachusetts to go from liquor smugglers to reputable political figures, so why can’t Chapo Guzman’s heirs someday be embarrassed by the original source of their funds?

Even now, that embarrassing narco-money is spread all over my state (Sinaloa) and there’s no way to “disinvest” those funds. While the state certainly has a right to track money entering the country (and to tax overseas earnings… i.e., narcotics sales), and tracing the funding back to the original financing source is going to be the only way to figure out who actually runs the narcotics trade (and are we sure we want to know?) I don’t think there’s much we can do about the money that’s already here. Nor, perhaps, should we.

2 Comments leave one →
  1. 29 June 2008 4:00 pm

    Nice writing. You are on my RSS reader now so I can read more from you down the road.

    Allen Taylor

  2. 1 July 2008 3:56 pm

    I think that drug legalization would actually hurt the extreamly high profit margin. The price of narcotics would drop so much, that the scum of the earth who do it today would quickly abandon it and find something else that makes a lot of money. Drugs do not cost that much to produce and distribute. If legalized, the Mexican-US border would be a lot safer. The crimes that might start to take place would most likely be human traficking, smuggling pirated intelecual property, or other items that trade ageements have prohibited. Drugs are as dangerous and destructive to humanity as cars. For some reason we don’t ban cars in the US, so why ban drugs? (Answer same reason that Americans are more afraid to go to Iraq than to drive on a freeway. Even though more people die of car accidents every year.)

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