Sunday, 24 April 2011


We creep ever nearer to lawlessness, and not just because most Americans have decided that their safety is more important to them than their liberty. A long investigative piece by Ed Vulliamy in The Guardian a few weeks ago about corruption in our midst has not had much play here, which is strange. I recommend digesting the whole thing here. It is utterly mind-boggling.

Vulliamy, the reporter who helped expose Serbian concentration camps during the 1990s Balkans wars, relates how the U. S. bank Wachovia merrily laundered hundreds of billions of dollars in Mexican narco-cash. Given the decades of hysteria in this country about the horrors of ‘drugs’, not to mention the 30 thousand-plus deaths in the narco wars south of the border, you’d think someone, somewhere, would have noticed that one of the largest banks in the country was complicit in the coke trade.

I mention this as a former client of Wachovia, now taken over by Wells Fargo, whose branch offices are popping up all over New York. Both these banks did not exactly distinguish themselves during the housing bubble that cost us our collective shirt. But who knew that they relied on drug lords’ cash to keep themselves afloat during the crucial panic months?

The amounts are staggering: for the three-year period from 2004-07, Wachovia admitting in writing to having processed $373 billion from Mexican money-changing houses and another $4.7 billion in cash’. Imagine a pile of 47 million 100-dollar bills—you’d need a football stadium just to house it.

Vulliamy quotes the UN drugs and crime agency head, Antonio Maria Costa, as suggesting that as the banking crisis developed in 2008, proceeds from drugs and crime were use to saved the giant banks teetering on the precipice: ‘Inter-bank loans were funded by money that originated from the drugs trade. There were signs that some banks were rescued that way’.

Wells Fargo acquired Wachovia as it foundered on the mortgage debacle, aided by $25 billion in taxpayer support. But the prosecutors who charged Wachovia—though none of its officers individually—settled for a measly $50 million fine, barely making a dent in its total 2009 profit of $12.3 billion.

As in the entire handling of the financial collapse that we continue to pay for, the federal authorities from Obama on down allow this rampant lawlessness to escape unpunished out of a convenient conviction that saving the banking sector requires winking at this sort of behavior. They then go to work for the firms they enabled and tell the rest of us that ‘change’ takes a long time to achieve, can’t be done overnight, etc.

In fact, real change could happen quite easily. You slap some charges on these bankers’ behinds and march them to jail. You forego juicy sinecures with the finance sector after your stint in government is over. You enjoy an honest job, earn an honest salary and go home to a modest domicile with no million-dollar paintings on the walls. You act like a public servant instead of a Wall Street hooker—no offense meant to hookers. Of course, anyone who tries to defend the public interest, as Vulliamy’s story points out, is immediately pilloried and persecuted for not being a team player.

One shudders to read of the terrifying violence spreading all over Mexico as the drug gangs crush one police entity after another, having long ago infiltrated the highest ranks of government. How long will it take for our deeply corrupted financial and political system to start showing signs that the Mexican virus has crept across the Rio Grande?

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