Profits, Poverty, and Illegality: The Logic of Drug Corruption
Andreas, Peter
If I could insert my own definition of drug corruption into the dictionary, it would simply read: "a business expense related to the production, trafficking, and sale of state-prohibited...
...While the aim of drug enforcement has been to curb the drug supply and raise drug prices high enough to make the drugs unavailable and unaffordable to consumers, the side-effect has been to dramatically inflate profits...
...The profits which fund corruption, ironically, are in large part also a product of state policy...
...drug-control strategists have nevertheless and Peruvi assumed that corruption within the enforcement effort Institutic in Latin America can be overcome through aid and the Colom training...
...In addition, successive Colomr bian presidents in the 1970s and 1980s began their terms in office by declaring a tax amnesty on repaal triated capital without inquiring into the origins of the funds...
...3 0 According to Rolando Morales, the former president of the Bolivian association of economists, the influx of drug dollars is "the only way we've been able to balance the balance of payments...
...Administrations repeatedly accused Cuba, Nicaragua, dict and leftist insurgents of sponsoring international drug able trafficking as part of an international Communist strat- low egy to undermine Western democracy...
...3 2 The Fujimori government has given every incentive for drug dollars to flow into the country's financial institutions...
...DEA agents often must run through checkpoints so that the police have VOL XXVII, No 3 Nov/DEc 199325 VOL XXVII, NO 3 Nov/DEC 1993 25REPORT ON CORRUPTION little time to phone ahead and warn the traffickers...
...At the same area time, political strategists within the Reagan and Bush nes...
...One of the most insidious-yet also most predictable-consequences has been widespread and wide-ranging forms of drug corruption...
...For example, my computer's dictionary defines corruption as "degrading or immoral habits and practices...
...border agent and a Peruvian official at a checkpoint in Peru: A colonel from Lima said, 'I have the opportunity while I'm here to make $70,000 by looking the other way at certain times...
...Consequently, the drug industry must rely on corruption to stay in business...
...By criminalizing the conditions under which drugs are produced, transported and sold, the state has driven the drug trade underground...
...All vice-control efforts are particularly susceptible to corruption, but none so much as drug enforcement," explains Ethan Nadelmann, a drug-policy specialist at Princeton University...
...This was in the 'too hot to handle' eva category," notes Gary Hufbauer, a senior fellow at the dru Institute for International Economics...
...Countless journalists, novelists, and filmmakers have reinforced this image-an image that has not been kind to those south of the Rio Grande...
...official...
...War on Drugs in Peru Shows Limited Gains," New York Times, December 6, 1992...
...3. Quoted in "Free-Trade Treaty May Widen Traffic in Drugs, U.S...
...2 2 Although General Meza stepped down in August, 1981, corruption remains well-entrenched within the Bolivian military...
...The distinction between li and illicit revenue has been erased...
...As a staff report of the U.S...
...Curiously, he was then by the president to head the country's most port...
...The drug bust was undermined when a 14-man Mexican army force, guarding the airstrip for the traffickers, opened fire on the agents, killing seven of them...
...2 7 The problem is particularly evident in those countries where drug revenues play a central role in the national economy...
...Plomo o plata"-a bullet or a bribe-was the choice given to many Colombian officials...
...The magnitude of the drug-corruption problem in Mexico was dramatized in late 1991 when 10 agents of Mexico's Federal Judicial Police attempted to apprehend two drug smugglers delivering 800 pounds of cocaine aboard a small airplane on a remote airstrip in the state of Veracruz...
...Ever since Peru began to suffer from severe balance-of-payments problems, the country's major banks, including the Central Bank, have operated busy branches in the main coca-producing zones to absorb the flow of illicit revenues...
...The motivation is clear...
...The United States has led the punitive offensive, providing aid and training to those Latin American security forces charged with waging "war" on the drug supply...
...pressure...
...Panama, for example, according to a S1991 U.S...
...For Peruvian Navy commanders operating along li River have reportedly not let U.S...
...This is not called corruption, of course...
...This was particularly true during the Bush on Gover Administration...
...1 4 "We know as a fact that the Peruvian Army gets payments for letting traffickers use airstrips," says U.S...
...2 5 Traffickers also make contributions to electoral campaigns...
...But they have their hands free to arrest people from rget other groups...
...And this June, the Mexican Attorney drug-prod General dismissed 67 federal agents, and a new anti- world's la drug force was ordered formed...
...3 3 Drug corruption thus takes many forms and operates at multiple levels across the Americas...
...2. Ethan Nadelmann, "The Case for Legalization," The Public Interest (Summer 1988), p. 19...
...As legal scholar Steven Wisotsky puts it, "if the cocaine industry commissioned a consultant to design a mechanism to ensure its profitability, it could not have done better than the war on drugs: just enough pressure to inflate prices from $2 to $100 per gram, but not enough to keep its product from the market...
...N ews stories and government reports on corruption invariably focus on how corruption has impeded drug enforcement...
...Hugo Moran, was also accused ion, and was eventually dishonorably disnder U.S...
...The most common is at the individual level: officials accept money simply to look the other way or conveniently disappear during a drug transaction...
...Yet such dismissals do not There hav address the systemic nature of the problem...
...To bring in the army [for drug control] would be the best way to promote drug trafficking in Bolivia," notes one development worker from Cochabamba...
...It is perhaps ironic that even as deregulation and free-market ideology have swept through Latin America, the region's most successful export remains the target of the most extreme government intervention: illicit drugs...
...Not surprisingly, it is the small fish of the g trade that fill most Latin American jails...
...Words listed as related to corruption include "decay, rot, squalor, evil, ill, sin, wrong, indecency, debasement, debauchery...
...drug-control policy in Latin America, along with the institutions that have been mobilized to carry the policy out, remain in place...
...Naylor, Hot Money and the Politics of Debt (New York: Simon and Schuster, 1987...
...Mexico's Drug Habit is Giving it Shivers," New York Times, June 20, 1993...
...Quoted in Hargreaves, Snow Fields, p. 184...
...It is, of course, impossible to provide exact statistics on the size of the illicit drug trade...
...As the DEA concedes, "All elements of the military are involved in drug trafficking to some extent...
...2 6 This political strategy, of course, is standard practice for many legal industries, including top U.S...
...Synonyms offered by my computer's thesaurus include "depravity, immorality, wickedness...
...erhaps the best way to understand how corruption works is to see the act of corrupting drugenforcement officials as the equivalent of paying informal tax...
...House Committee on Government Operations, "U.S...
...2 8 In Bolivia, between $500 and $800 million is generated annually from the illicit industry-a significant amount, considering that the country's combined legal exports generate only about $300 million a year...
...There's lots of it...Imagine what you would do...
...of weeding out drug corruption are themselves cor- Jos6 Gonz rupted...
...In their frustrated quest for political influence and social acceptance among Colombia's traditional elite, the nouveau riche traffickers from Medellin increasingly challenged the state through intimidation and murder...
...Thus, drug profits hiding in Caribbean cit bank accounts can safely come home...
...In April of the same year, the Boli- example, I vian government announced the dismissal of much of the Ucaya the top leadership of the U.S.-trained anti-drug police enforcem on drug-related charges...
...Part of the problem is that corruption is such a morally charged term that it can often obscure the source, nature, and function of drug corruption...
...While the number of stories are endless, they are basically variations on a theme...
...Corruption, of course, is not restricted to drug enforcement...
...U.S...
...The U.S...
...against ac In Mexico, for example, 3,000 customs police were problem fired in 1991...
...5 riega's involvement in the drug trade was largely ed on taxing Colombian drug shipments that ved through Panama...
...2 3 Garcia Meza continues to move about freely in Bolivia and to receive his military pension, and many high officials from his regime are currently in positions of power...
...We think of our families...
...House Committee on Government Operations, "Stopping the Flood of Cocaine With Operation Snowcap: Can it Work...
...9 Bolivian anti-drug police at checkpoints have sometimes fired on fellow police officers and U.S...
...For example, traffickers responded to the 1989 crackdown on the Medellin drug cartel in Colombia by expanding their operations in neighboring countries such as Venezuela, Brazil and Ecuador...
...rate Although the United States has been the most aggres- mei sive advocate of a get-tough drug-enforcement strate- doe gy, Washington officials have often looked the other doil way when other political interests are at stake...
...Office of National Drug Control Policy, "The Andean Strategy," August 1, 1990...
...If I could insert my own definition of drug corruption into the dictionary, it would simply read: "a business expense related to the production, trafficking, and sale of state-prohibited drugs...
...Such political- incr motivated charges obscure the deeper economic ic of the problem...
...drug policy and Latin American drug trafficking...
...charges even direc of drug corruption...
...Special Forces commander General Robert Kingston described a conversation between a U.S...
...New laws prohibited official inquiries into the origins of all wealth brought into Bolivia, and tellers at the Central Bank were not allowed to question the source of dollar deposits...
...Peter Andreas is working on a Ph.D...
...agreement makes the United States more accessible mo, for traffickers, the problem was not discussed during entl the negotiations...
...in Government at Cornell University...
...Even minimal levels of enforcement mean that a "corruption tax" will necessarily exist wherever the industry does business...
...Retired U.S...
...Unfortunately, the powerful economic logic which drives drug corruption is unlikely to be reversed until the drug tastes of Northern consumers dramatically change or the punitive, supply-side orientation of government drug-control efforts is significantly redirected...
...From Chile to Panama to many Caribbean islands, this basically translates into a legalized form of drug money laundering...
...program resigned in March, 1991 after U.S...
...vid There are, of course, periodic efforts to clean house the by removing individual officers accused of corruption...
...The problem is compounded when those in charge Bank re...
...As the 1990 report of the U.S...
...Mexico, in turn, has stepped up its anti-drug campaign, forcing traffickers to devote more resources to corrupting the Mexican enforcement effort...
...government estimates that 50 to 70% of all cocaine shipped to the United States now arrives via Mexico...
...This structure of corruption favors large, well-established trafficking organizations...
...I am going to make it.'7 A trooper in Bolivia's Chapare coca-growing region earns only $60 a month...
...When you have a corrupt chief of the army, he fires you...
...You have a family, they are protected in the United States, you have a proper pension plan...
...They tip off drug traffickers before anti-drug raids, or accept pay-offs to allow arrested traffickers to escape...
...Military," January, 1990, p. 31...
...As Alain Labrousse explains, the drug trade "helps to swell the currency reserves of the state and thus assists in supporting the value of the boliviano (the national currenFujimori has given every incentive foi drug dollars to flow into Peru's financi institutions...
...One could call the tactics of the Medellin group "offensive corruption," and the tactics of the Cali group "defensive corruption...
...Says," New York Times, May 24, 1993...
...Suffering from chronic balance-of-payments problems, it is little surprise that Andean governments tolerate dollars from any source-legal or illegal--even as they declare their commitment to the battle against drugs...
...Those traffickers with the most resources and contacts can afford the "corruption tax" and pay it to the st appropriate tax collector, while the smaller drug repreneurs are treated by the authorities like tax ders...
...Even when police extort money and drugs from traffickers and dealers, the latter are in no position to report the corrupt officers...
...Drug Enforcement Administration (DEA) agents to stop or stall them from carrying out a raid...
...These are necessarily very rough estimates...
...When police accept bribes....no victim exists to complain to the authorities...
...U Profits, Poverty and Illegality: The Logic of Drug Corruption 1. Steven Wisotsky, Beyond the War on Drugs (Buffalo, New York: Prometheus Books, 1990), pp...
...See R.T...
...Alain Labrousse, "Dependence on Drugs: Unemployment, Migration, and An Alternative Path to Development in Bolivia," International Labour Review, No...
...Office November of National Drug Control Policy stated, "increased Corptio military and law enforcement capability...can tion with strengthen a country's national will to initiate and sus- an entren tain counternarcotics programs...
...Quoted in U.S...
...Colombia, for example, did not carry out a full-scale attack on the Medellin trafficking cartel until the organization's terror tactics had become a direct threat to the credibility and political authority of the state in the late 1980s and early 1990s...
...1 2 In reality, however, forces...C the effect can be precisely the reverse: an increased M6ndez p enforcement capability can make corruption even the army more profitable for those charged with carrying out because d drug-control operations...
...Pins Hopes on Guatemala Army," New York Times, July 5, 1990...
...2 4 Not surprisingly, Bolivians from across the political spectrum have been skeptical of using the military as drug warriors...
...3 A The politically sensitive issue of drug corruption is und also easily manipulated to serve ideological ends...
...2 1 [ht in the summer of 1989 loading 55 pounds into a Miami-bound plane owned by the nt airline...
...In contrast, the trafficking activities of the more lowprofile and business-like Cali cartel were largely ignored in the government's crackdown...
...But since the Sandinista government in Nicaragua was defeated electorally and the war in El Salvador ended with a negotiated settlement, progressives throughout the region have begun a major reassessment of their recent history...
...From the Cuban Revolution of 1959 to the collapse of the Soviet model in 1989, socialism was viewed as a realizable goal by progressives in Central America...
...If we go out on a raid and a trafficker shows us a $100 bill, with the few resources we have, what do you think we do...
...One senior Mexican official cribed the process this way: "[Drug enforcement agents] receive money from one group of traffickers and they cannot act against people from that group...
...DEA agents an anti-drug police.19 )nalized corruption is also pervasive within bian military...
...13 option becomes institutionalized when indiuals within an institution are complicit in trade and the institution acts as a shield :countability...
...Corruption is formalized in state-business relations in general...
...The fact that drug trafficking-along with corruption, violence, and addiction-has spread to an area that was previously unscathed is dismissed as irony...
...It was not until Noriega had lost his political flov usefulness, it should be remembered, that the United Pan States decided to indict him for drug corruption- throw charges which ultimately helped legitimize the V December 1989 invasion of Panama...
...14.00 paper/$26.00 cloth/256 pp...
...For me example, while drugs and corruption have been a dru major source of tension in U.S.-Mexican relations, the min issue virtually disappeared from the political agenda T in the midst of delicate negotiations over the North tim American Free Trade Agreement (NAFTA...
...For example, Colonel Faustino Rico Toro, the head of Bolivian Army intelligence during Meza's rule, was appointed to head the anti-drug police in 1991 before he resigned under strong U.S...
...Quoted in Hargreaves, Snow Fields, p. 148...
...Quoted in Sam Zuckerman, "Banking on More than Tin and Coca," Euromoney, June, 1987, p. 115...
...President Bush was a particularly eager advocate of a supply-side enforcement strategy, reflected in dramatic increases in federal funding for international drug control during his term in office...
...3 1 In neighboring Peru, the illicit drug industry generates between $750 million to $1 billion annually-roughly the equivalent of one-third of all legal exports combined...
...drugent agents enter coca-producing areas.18 e also been repeated cases of military perng at helicopters carrying U.S...
...orms of corruption are wideranging and operate at various levels across the region...
...Because drug trafficking is so extensive, governments are selective in their targeting of the problem...
...They are often hidden in statistics through the over-invoicing of exports and under-invoicing of imports, or by falsifying earnings from sectors such as tourism...
...But the possibilities for such abuse are much greater there than in other enforcement areas, largely because of the character of the illegal activity...
...ihen enforcement efforts are intensified in one a (increasing the traffickers' cost of doing busis, including the cost of corruption), traffickers preably respond by expanding to new, more favorbusiness climates, where the "corruption tax" is er...
...Traffickers usually give to more than one political party as an insurance pol- icy...
...House Committee nment Operations report observed in ,1990: n-in the form of bribes and direct collaboradrug-financed paramilitary groups-remains ched problem within the Colombian armed olombia's Attorney General Alfonso G6mez ublicly stated in 1989 that it was a mistake for to become involved in drug-control operations rug money had penetrated its ranks...
...In Peru, Bolivia, and Colombia, for example, financial policies are designed so that drug dollars are absorbed by the Central Bank...
...Government Accounting Office report, become a much more popular transshipment point illicit drugs since the fall of the Noriega regime...
...He writes frequently on U.S...
...Although forms and degrees of drug corruption vary enormously and operate at both individual and institutional levels (as we will see later), this basic definition applies in virtually all cases...
...Few issues are so easily misunderstood, distorted and manipulated as drugs and corruption, especially given the ideological climate and inflated rhetoric of the "war on drugs...
...All too often we seem to conveniently forget that the marriage between drugs and corruption was in fact 22NACIA REPORT ON THE AMERICAS NACIA REPORT ON THE AMERICAS 22REPORT ON CORRUPTION arranged by the state-and state policy prohibits a divorce...
...officials concede that the free-trade des All too often we seem to conveniently fo that the marriage between drugs anc corruption was in fact arranged by the stz and state policy prohibits a divorce...
...6 It is no surprise that as the trade spreads, so does corruption-after all, no country provides a completely "tax-free" business climate...
...1 0 This is charged u not to suggest that all drug-enforcement officials are appointed corrupt or corruptible...
...The enormous profits of the drug trade assure that the illicit industry has the financial means to corrupt...
...4. Quoted in "Mexico's Drug Habit is Giving it Shivers," New York Times, June 20, 1993...
...House Committee on Government Operations, "Stopping the Flood of Cocaine with Operation Snowcap: Can it Work...
...August 15, 1990...
...2 Thus, the "victimless" nature of the crime, combined with the high profits to be made, create incentives which all-too-often prove irresistible...
...The banks also buy dollars on Ocofia Street in downtown Lima, Peru's huge informal foreign-exchange market, which is supplied largely by drug dollars...
...Instead, it is called "loose foreignexchange controls," "strict bank-secrecy laws," "financial deregulation," and so on...
...An anti- government drug] officer simply has to instruct his guys not to task force, search some traffickers at a particular checkpoint for of corrupt three days and he earns a lifetime's salary...
...Rather, drugs are Latin Ameri- ca's most profitable export precisely because they are illegal...
...These financial policies have boosted Bolivia's foreign-exchange reserves, which in turn have helped to stabilize the currency and to curb inflation...
...Special Forces commander Colonel Robert Jacobelly.15 For example, the military reportedly charges traffickers up to $15,000 per flight to use the airport at Uchiza, a small town in the valley.16 Two to four drug flights reportedly left the Upper Huallaga Valley for Colombia every day in 1992yet only five flights were intercepted that year.17 At times, military personnel have :tly blocked drug-enforcement efforts...
...It would therefore be wrong to conclude that it is simply Latin America's unfortunate fate that its most profitable export just happens to be illegal...
...corporations during election time in the United States...
...official...
...As a result, Mexico now finds itself overrun by cocaine transshipment activity...
...19...
...Rensselaer Lee, The White Labyrinth (New Brunswick, New Jersey: Transaction Books, 1989...
...The often violent collision between drugs and drug control has sent shock waves from Chile to Mexico, transforming the political and economic landscape of the Americas...
...Military and the War on Drugs in the Andes, Washington Office on Latin America, October, 1991, p. 101...
...Quoted in "U.S., Bolivians Fall Out Over Drugs," Christian Science Monitor, March 18, 1991, p. 4 . 24...
...Although President Clinton has shown less enthusiasm for foreign drug campaigns than his predecessor, the punitive emphasis of U.S...
...While legal industries have armies of lobbyists and lawyers to get around government restrictions, the drug industry must rely on less legitimate-more corrupt-means to attain the same ends...
...31 and 36...
...This volume presents two of these reassessments, both by participants who remain committed to the goal of socialism...
...2 0 cords found after the killing of trafficker alo Rodriguez Gacha showed that he had imillion-dollar payoffs to entire brigades of 26 NACLA REPORT ON THE AMERICAS NACIA REPORT ON THE AMERICAS 26REPORT ON CORRUPTION Institutionalized corruption reaches its highest level when a drug-infiltrated military effectively becomes the government...
...Placing blame on the military, however, should not obscure the broader reach and role of corruption in Bolivia...
...A similar dispersion of trafficking activities has taken place in response to drug enforcement in the Andean cocaine-producing countries of South America...
...2.00 P & H) 40NACLA REPORT ON THE AMERICAS NACLTA REPORT ON THE AMERICAS 40 REPORT ON CORRUPTION 20 U.S...
...Largely missing from these accounts of corruption, however, are forms of what I will call "legitimized corruption"-reflected, for example, in the financial policies of many governments...
...As enforcement levels increase, so too s the drug industry's need to corrupt those who are ng the enforcing...
...This basically translates into a legalized form of drug-money laundering...
...Indeed, tho even though U.S...
...The most common estimates given by economists who analyze the coca/cocaine trade in Bolivia, Peru and Colombia fall within the ranges I give...
...Much of these revenues enter directly through the Central Bank, which has a long-standing policy of accepting all dollar deposits with no questions asked...
...This has been a pervasive within the military, especially in the key ucing and transit countries...
...Eduardo Sarmiento, "The Drug Trafficking Economy," CEDE, University of the Andes, Bogot6, Colombia, March 6, 1990...
...SHAFIK JORGE HANDAL AND CARLOS M. VILAS MONTHLY REVIEW PRESS 122 WEST 27TH STREET NEW YORK, NY 10001 (212) 691-2555 In The Socialist Option in Central America, Shafik Jorge Handal and Carlos M. Vilas directly confront the relationship between democracy and socialism, examining the social struggles, electoral conflicts, and economic constraints that will shape Central America's future...
...The government woos capital repatriation with no questions asked and with a tax amnesty...
...With the further loosening of foreign-exchange controls, the distinction between licit and illicit revenue has been erased...
...cy) and in repaying the foreign debt...
...In all three Andean countries, drugs are the leading source of export revenue...
...Thu Throughout the 1980s, the battle against Communism tax' in Central America gave Washington an incentive to Jul3 turn a blind eye to drug corruption when those whom has it considered allies in the region were involved, for including top Honduran military officials, the Nor Nicaraguan Contras, and Panama's General Manuel bas Noriega...
...policymakers...
...Once in the financial system, these dollars can be used for Vot XXVII, No 3 Nov/DEc 199327 27 VOL XXVII, No 3 Nov/DEC 1993REPORT ON CORRUPTION many of the country's foreign-exchange needs, including paying the foreign debt...
...The chief of the anti-corruption Lieut...
...The most absurd irony is that some have even been placed in charge of drug control...
...is, they take their business to where the "corruption "is lowest...
...As one former Planning Minister noted, "when you have a corrupt chief of police, you fire him...
...s shrewd business managers, drug traffickers lerstandably prefer the path of least resistance...
...With Noriega gone, however, iama has become a largely unregulated door ugh which traffickers can ship their goods...
...In Peru, the rgest producer of coca (the raw material of najor coca-processing facilities and airstrips er Huallaga Valley are located near military facilities to provide them with greater protection, according to a senior DEA official...
...30...
...4 This type of selective enforcement is quite practical: officials can do their job-seizing drugs and Ite_ arresting traffickers-while also collecting taxes from the drug trade...
...Corruption within the Bolivian military is particularly entrenched because of the lack of accountability to civilian authority...
...The point is simply that as long important as the financial incentives are so enormous, and legitimate sources of income so depressed, high levels of omd corruption are unavoidable...
...It is in this criminalized context that the pervasiveness of corruption, especially within those agencies charged with carrying out drug enforcement, becomes not only understandable but predictable...
...drug policy in Latin America for years...
...In Bolivia, for example, drug-policy analyst Rensselaer Lee observes that "narcotrafficking provided financial backing for [General Luis] Garcia Meza's coup in July, 1980, and there was a virtual symbiosis between drug trafficking and the state under Meza's regime...
...AntiNarcotics Activities in the Andean Region," November, 1990, p. 90...
...One of the most profound consequences of such pervasive corruption has been the further erosion of the public's already tarnished faith in the state...
...Selective tolerance and selective targeting of drug trafficking and corruption have been defining features an of U.S...
...The antonym of corruption is "virtue...
...Hargreaves, Snow Fields, p. 184...
...For example, traffickers responded to eased drug-interdiction efforts in Southern FloriNACLA REPORT ON THE AMERICAS 24REPORT ON CORRUPTION da in the late 1980s by shifting to new shipping routes through Northern Mexico...
...If the drug industry didn't pay off government officials, it would be the only industry in Bolivia that didn't," says one U.S...
...See Humberto Compodonico, "La Politica Del Avestruz," in Diego Garc(a Sayan, ed., Coca, Cocaina, Y Narcotrfico (Lima, Peru: Comisi6n Andina de Juristas, 1989...
...pressure...
...For a useful discussion on drug-trade statistics, see Compodonico, "La Politica Del Avestruz...
...were caug "Corruption permeates all levels of the anti-narcotics of cocaine forces," acknowledges one DEA official...
...1 In Bolivia, both the cocaine), r Minister of the Interior and the head of the anti-drug in the Upp Forms of "legitimized corruption"are reflected in the financial policies of many governments...
...The Cali traffickVOL XXVII, No 3 Nov/DEc 1993 23 n 3 ti k m n I: 23 VOL XXVII, No 3 Nov/DEc 1993REPORT ON CORRUPTION ers, on the other hand, simply wanted to be left alone ly by the state--offering plenty of "plata" to buy official log neglect...
...While corruption has been integral to the business strategies of both trafficking organizations, there has been a qualitative difference in their tactics and goals...
...sonnel firi U.S...
...As one Bolivian politician put it, "protection money doesn't dirty you, you don't handle the stuff, you just say when there's going to be a strike and money appears in your account...
...6. House Judiciary Committee's Subcommittee on Crime and Criminal Justice, "The Andean Initiative: Squeezing a Balloon," February, 1992, p. 3. 7. House Committee on Armed Services' Defense Policy Panel and Investigations Subcommittee, "The Andean Drug Strategy and the Role of the U.S...
...Whoever is in charge of enforcent-local police, U.S.-trained paramilitary antig forces, various branches of the military-deteries who "collects" the tax revenue...
...The Peruvian Central Bank became an especially active buyer of drug dollars since the government initiated its stabilization program in 1990, reportedly purchasing an estimated $4 million to $13 million a day...
...In Colombia, the drug industry generates $1 to 1.5 billion annually-representing roughly 20% of total export earnings...
...ShafikJorge Handal was a guerrilla commander and leader of the Communist Party of El Salvador, while Carlos M. Vilas, an Argentinian scholar, worked in Nicaragua from 1980 to 1990...
...Michael Massing, "In the Cocaine War...The Jungle is Winning," New York Times Magazine, March 4, 1990, p. 90...
...It's a business like any other...
...Political considerations often shape when, where and how they respond...
...As Latin American drug exports (primarily cocaine but also heroin and marijuana) have rapidly increased, so have government efforts to suppress them...
...Well, you've guessed, corruption...
...My family is not protected, I don't have a proper pension plan, and I will never have the opportunity to make $70,000 as long as I live...
...Quoted in Clear and Present Dangers: the U.S...
...House Subcommittee on Crime and Criminal Justice observed in early 1992, "when traffickers modify their methods, the Administration deems it a triumph...
...Every trafficker with the savvy to come in from the rain pays off the political parties," says one U.S...
...August 14, 1990...
...8. Quoted in Clare Hargreaves, Snow Fields: the War on Cocaine in the Andes (New York: Holmes and Meier, 1992), p. 95...
...Robin Kirk, "Cash-starved Peru Looks to Drug Dollars for Its Salvation," Pacific News Service, December 10-14, 1990...
...9. Hargreaves, Snow Fields, p. 54...
...And the enormity of both the drug trade and the drugenforcement effort means that there are countless opportunities for such abuse...
...War on Drugs in Peru Shows Limited Gains...
...These drug revenues, of course, are almost always ignored in official statistics...
...While corruption-in the form of bribes and pay-offs-has long been an important part of the relationship between business and the state in Latin America, corruption necessarily plays a more vital role in the case of the drug industry because the product it makes is illicit...
...The dire consequences are lost on U.S...
...5. Cited in James Henry, "Panama: Dirty Business as Usual," Washington Post, July 28, 1991...
...If I could insert my own definition of drug corruption into the dictionary, it would simply read: "a business expense related to the production, trafficking, and sale of state-prohibited drugs...
...As a U.S...
...2 9 As part of the economic-stabilization program initiated in 1985, the Paz Estensorro government instituted a number of measures that have facilitated the absorption of these drug revenues into the financial system, such as loosening the disclosure requirements of the Central Bank and declaring a tax amnesty on repatriated capital...
...Attention thus tends to center on how particular drug busts were compromised by corrupt police, or how particular traffickers bought their way out of jail, or how a particular drug seizure mysteriously disappeared from government custody...
...One policeman involved in anti-drug operations in the Chapare described how he supplements his meager salary: "So how do I survive...
...Quoted in Clear and Present Dangers, p. 123...
...Levels of corruption-the "tax ""--often depend on the intensity of the enforcent effort...
...Inside the Cartel," PBS Frontline, May 22, 1990...
...3 (1990), p. 341...
...The government also created a foreign-exchange auction, called the bolsin, which allowed the Central Bank to compete with the parallel foreign-exchange market for drug dollars...
...8 Not surprisingly, police officers often bribe their superiors to get assigned to drug-producing zones...
...We take the money...
...hose traffickers who pay their taxes in full and on e tend to be less pressured by the authorities than se who do not...
...In Guatemala, for example, two aides to the made mult chief of President Cerezo's anti-corruption task force the army...
...When drugs are added to corruption, the term becomes even more potent in the popular imagination, suggesting truly sinister forces at work...
...Frustrated drug enforcers thus find they are squeezing a balloon: pushing down on the trade in one area causes it to pop up in another...
Vol. 27 • November 1993 • No. 3
