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Wall Street's Role in Narco Trafficking, The War on Drugs is a Fraud

Politics / US Politics Jun 02, 2011 - 07:32 AM GMT

By: Mike_Whitney

Politics Best Financial Markets Analysis Article

Imagine what your reaction would be if the Mexican government agreed to pay Barack Obama $1.4 billion to deploy US troops and armored vehicles to New York, Los Angeles and Chicago to conduct military operations, set up check points, and engage in fire-fights that end up killing 35,000 US civilians on the streets of American cities.

If the Mexican government treated the United States like this, would you consider them a friend or an enemy?

But--the thing is--this is exactly how the US is treating Mexico, and it's been going on since 2006.

America's Mexican policy--The Merida Initiative--is a real nightmare. It's undermined Mexican sovereignty, corrupted the political system, and militarized the country. It's also resulted in the violent deaths of thousands of mostly poor civilians. But Washington doesn't give a hoot about "collateral damage" as long as it can sell more weaponry, strengthen its free-trade regime, and sluice more drug profits into its big banks. Then everything is just Jim-dandy.

There's no point in dignifying this butchery by calling it a "War on Drugs"? That's nonsense. What we're seeing is a giant powergrab by big business, big finance and the US Intel services. Obama is merely doing their bidding, which is why--not surprisingly--things have gotten a lot worse under his administration. Obama has not only stepped up the funding for Plan Mexico (aka--Merida) but also deployed more US agents to work undercover while US drones carry out surveillance duty. Get the picture? This isn't some little drug bust; it's another chapter in America's War on Civilization.

Here's an excerpt from an article in Counterpunch by Laura Carlsen that gives a little background:

"The drug war has become the major vehicle of militarization in Latin America. It's a vehicle funded and driven by the U.S. government and fueled by a combination of false morals, hypocrisy and a lot of cold, hard fear. The so called "war on drugs" is really a war on people, especially youth, women, indigenous peoples and dissidents. The drug war has become the main way for the Pentagon to occupy and control countries at the expense of whole societies and many, many lives.

Militarization in the name of the drug war is happening more quickly and more thoroughly than most of us probably anticipated under the Obama administration. The agreement to establish bases in Colombia, later suspended, sent out one of the first signals of the strategy. And we've seen the indefinite extension of the Merida Initiative in Mexico and Central America, and even, sadly, war boats sent to Costa Rica, a nation with a history of peace and no army......

The Merida Initiative funds U.S. interests to train security forces, provide intelligence and war technology, give advice on reforming the justice and penal systems and promoting human rights–all in Mexico. (The Drug War Can't Be Improved, It Can Only be Ended, Laura Carlsen, Counterpunch)

If it looks like Obama is doing his best to turn Mexico into a military dictatorship, it's because he is. Plan Mexico is a sham that conceals the administration's real motives, which is to make sure that the lavish profits from the drug trade end up in the right people's pockets. That's what this is all about, big money. And that's why the death toll has soared while the Mexican government's credibility has hit it's lowest ebb in decades. US policy has turned large swaths of the country into killing fields and it's only getting worse.

Check out this interview with Charles Bowden who describes what life is like for the people who live at Ground Zero in the drug war; Juarez, Mexico:

"This is in a city where people live in cardboard boxes sometimes. Ten thousand businesses have given up and closed in the last year. Thirty to sixty thousand people from Juárez, mainly the rich, have moved across the river to El Paso for safety, including the mayor of Juárez, who likes to bunk in El Paso. And the publisher of the newspaper there lives in El Paso. Somewhere between 100,000 and 400,000 people simply left the city. A lot of the problem is economic, not simply violence. At least 100,000 jobs in the border factories have vanished during this recession because of the competition from Asia. There’s 500 to 900 gangs there, estimates vary.

So what you have is about 10,000 federal troops and federal police agents all marauding. You have a city where no one goes out at night; where small businesses all pay extortion; where 20,000 cars were officially stolen last year; where 2,600-plus people were officially murdered last year; where nobody keeps track of the people who have been kidnapped and never come back; where nobody counts the people buried in secret burying grounds, and they, in an unseemly way, claw out of the earth from time to time. You’ve got a disaster. And you have a million people, too poor to leave, imprisoned in it. That’s the city."(Charles Bowden, Democracy Now)

This isn't about drugs; it's about a crackpot foreign policy that supports proxy-armies to impose order through police-state repression and militarization. It's about expanding US power and beefing up profits on Wall Street.

Here's more background from author Lawrence M. Vance at the The Future of Freedom Foundation:

"An undisclosed number of U.S. law-enforcement agents work in Mexico... The DEA has more than 60 agents in Mexico. There are in addition 40 Immigration and Customs Enforcement agents, 20 Marshal Service deputies, and 18 Alcohol, Tobacco, Firearms and Explosives agents, plus agents from the FBI, Citizen and Immigration Service, Customs and Border Protection, Secret Service, Coast Guard, and Transportation Safety Agency. The State Department also maintains a Narcotics Affairs Section. The United States has also provided helicopters, drug sniffing dogs, and polygraph units to screen law-enforcement applicants.

U.S. drones spy on cartel hideouts, and U.S. tracking beacons pinpoint suspect’s cars and phones. U.S. agents track beacons, trace cell-phone calls, read e-mails, study behavioral patterns of border incursions, follow smuggling routes, and process data about drug dealers, money launderers, and cartel bosses. According to a former Mexican anti-drug prosecutor, U.S. agents are not restricted from eavesdropping on anyone in Mexico by U.S. laws that require judicial authority as long as they are not on U.S. territory and not bugging American citizens. ("Why Is the U.S. Fighting Mexico's Drug War?" Laurence M. Vance, The Future of Freedom Foundation)

Good God, the place is crawling with US Intel agents. This isn't foreign policy; it's another US occupation. And, guess who's raking in the big cashola on this sordid little scam?

Wall Street. That's right, the big banks are getting their cut just like they always do. Take a look at this excerpt from an article by James Petras titled "How Drug Profits saved Capitalism" at Global Research. It's a great summary of the objectives that are shaping the policy:

"While the Pentagon arms the Mexican government and the US Drug Enforcement Agency enforces the “military solution”, the biggest US banks receive, launder and transfer hundreds of billions of dollars to the drug lords’ accounts, who then buy modern arms, pay private armies of assassins and corrupt untold numbers of political and law enforcement officials on both sides of the border....

Drug profits, in the most basic sense, are secured through the ability of the cartels to launder and transfer billions of dollars through the US banking system. The scale and scope of the US banking-drug cartel alliance surpasses any other economic activity of the US private banking system. According to US Justice Department records, one bank alone, Wachovia Bank (now owned by Wells Fargo), laundered $378.3 billion dollars between May 1, 2004 and May 31, 2007 (The Guardian, May 11, 2011). Every major bank in the US has served as an active financial partner of the murderous drug cartels...

The Drug Traffickers, the Banks and the White House

If the major US banks are the financial engines which allow the billion dollar drug empires to operate, the White House, the US Congress and the law enforcement agencies are the basic protectors of these banks.....Laundering drug money is one of the most lucrative sources of profit for Wall Street; the banks charge hefty commissions on the transfer of drug profits, which they then lend to borrowing institutions at interest rates far above what – if any – they pay to drug trafficker depositors. Awash in sanitized drug profits, these US titans of the finance world can easily buy their own elected officials to perpetuate the system.
("How Drug Profits saved Capitalism" , James Petras, Global Research)

Repeat: "Every major bank in the US has served as an active financial partner of the murderous drug cartels..."

The War on Drugs is a fraud. This isn't about interdiction; it's about control. Washington provides the muscle so the banks can rake in the big doe. One hand washes the other, just like the Mafia.

By Mike Whitney


Mike is a well respected freelance writer living in Washington state, interested in politics and economics from a libertarian perspective.

© 2011 Copyright Mike Whitney - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis.
Individuals should consult with their personal financial advisors.

Mike Whitney Archive

© 2005-2016 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Brandt Hardin
02 Jun 11, 14:41
Legalize IT!

The War on Drugs failed Billions of dollars ago! This money could have been used for outreach programs to clean up the bad end of drug abuse by providing free HIV testing, free rehab, and clean needles. Harmless drugs like marijuana could be legalized to help boost our damaged economy. Cannabis can provide hemp for countless natural recourses and the tax revenue from sales alone would pull every state in our country out of the red! Vote Teapot, PASS IT, and legalize it. Voice you opinion with the movement and download my FREE poster at

Jayelle Farmer
02 Jun 11, 23:33
why cannabis campaigners have been bashing their heads against a brick wall

Great article. Leaves me in doubt whatsoever that this "war on drugs" is all about BIG money.

What do you suggest we do about it?

malcolm kyle
04 Jun 11, 06:34
Prohibition and the corrupt American Empire

If you are a Prohibitionist then you owe us answers to the following questions:

#1. Why do you rejoice at the fact that we have all been stripped of our 4th amendment rights and are now totally subordinate to a corporatized, despotic government with a heavily armed and corrupt, militarized police force whose often deadly intrusions into our homes and lives are condoned by an equally corrupt and spineless judiciary?

#2. Why do you wish to continue to spend $50 billion a year to prosecute and cage your fellow citizens for choosing drugs which are not more dangerous than those of which you yourself use and approve of such as alcohol and tobacco?

#3. Do you honestly expect the rest of us to look on passively while you waste another trillion dollars on this garbage policy?

#4. Why are your waging war on your own family, friends and neighbors?

#5. Why are you so complacent with the fact that our once 'free & proud' nation now has the largest percentage of it's citizenry incarcerated than any other on the entire planet?

#6. Why are you helping to fuel a budget crisis to the point of closing hospitals, schools and libraries?

#7. Why do you rejoice at wasting precious resources on prohibition related undercover work while rapists and murderers walk free, while additionally, many cases involving murder and rape do not even get taken to trial because law enforcement priorities are subverted by your beloved failed and dangerous policy?

#8. Why are you such a supporter of the 'prison industrial complex' to the extent of endangering our own children?

#9. Will you graciously applaud, when due to your own incipient and authoritarian approach, even your own child is caged and raped?

* It is estimated that there are over 300,000 instances of prison rape a year.
* 196,000 are estimated to happen to men in prison.
* 123,000 are estimated to happen to men in county jail.
* 40,000 are estimated to be committed against boys in either adult prisons or while in juvenile facilities or lock ups.
* 5000 women are estimated to be raped in prison.

#10. And will you also applaud when your own child, due to an unnecessary and counter productive felony conviction, can no longer find employment?

Private prisons are publicly traded and their stock value is tied to the number of inmates. Here's what the UK Economist Magazine thinks of the situation: "Never in the civilised world have so many been locked up for so little"

According to Paul Craig Roberts, a former editor of the Wall Street Journal and former assistant secretary to the treasury under Ronald Reagan, "Police in the US now rival criminals, and exceed terrorists as the greatest threat to the American public."

"Narcotics police are an enormous, corrupt international bureaucracy and now fund a coterie of researchers who provide them with ‘scientific support’, fanatics who distort the legitimate research of others. The anti-marijuana campaign is a cancerous tissue of lies, undermining law enforcement, aggravating the drug problem, depriving the sick of needed help, and suckering well-intentioned conservatives and countless frightened parents."  – William F. Buckley, Commentary in The National Review, April 29, 1983, p. 495

There is no conflict between liberty and safety. We will have both or neither.
William Ramsey Clark (1927--)

04 Jun 11, 12:01

We had to destroy the village to save it.

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