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Narco Dollars for Dummies [Dec. 14th, 2004|12:17 pm]
Aspects of Criminalization


Actual Title:

Narco-Dollars for Beginners: "How the Money Works" in the Illicit Drug Trade: Part I in a Series

By Catherine Austin Fitts

Link: http://www.narconews.com/Issue20/narcodollars1.html

Summary: Catherine Austin Fitts, a former Assistant Secretary of Housing-Federal Housing Commissioner in the first Bush Administration, makes the argument that so much money made from the sale of illicit drugs ends up invested in legitimate enterprises that if the US ended prohibition in one fell swoop the resulting fallout would leave major corporations so starved for investment capital that it would wreck the US and world ecconomies.

One day, Forest, my dog, and I were up in Georgie's apartment to enjoy a fresh plate of scrapple that Georgie had fried up that morning. The conversation turned to narco dollars. Georgie said that looking at the big picture was simply too overwhelming. Couldn't I explain this without using the words millions or billions - just dollars and cents in terms of our neighborhood in West Philadelphia?
I always have this problem explaining international money flows to moms and grandmoms. Most really great women want to know about the real world. The world of real people - her world full of her kids and grandkids and other kids she loves.

So we got out a blank piece of paper and started to estimate.

Every day there are two or three teenagers on the corner dealing drugs across from our home in Philadelphia. We figured that if they had a 50% deal with a supplier, did $300 a day of sales each, and worked 250 days a year that their supplier could run his net profits of approximately $100,000 through a local fast food restaurant that was owned by a publicly traded company.

Assuming that company has a stock market value that is a multiple of 20-30 times its profits, a handful of illiterate teenagers could generate approximately $2-3 million in stock market value for a major corporation, not to mention a nice flow of deposits and business for the Philadelphia banks and insurance companies.

Part I didn't really lend itself to excerpting. The quoted passage comes from Part II.

Questions for discussion:

  • Do you think the consequences of Dave and Sam's respective career choices as described in Part I would lead to the consequences Catherine Austin Fitts describes?

  • Would you push the big red button on the lectern in Part III? Why, or why not?

  • Do you think Fitts' proposal for raising the Solari Index would really amount to "the biggest capital gains opportunity in America?" If not, what alternative approach do you think would offer a better chance of success?

    Cross posted to: libertarianism and drugwar
  • LinkReply

    [User Picture]From: treehuggerkeith
    2005-01-07 09:29 pm (UTC)
    This comment is not related to this particular post, but I did notice something that caught my attention. In your intrests you have listend "hemp". In a community soully dedicated against drugs I would assume the education standards high enough to know that hemp is just a type of cord, and thatn despite popular beleif, has little relevance to marijuna or other drugs. Infact, most hemp that one may buy does not come from the Cannabis Sativa plant, unless you specifically buy Cannabis hemp. While I remain open minded, I am trying to correct this misconception, without being a total asshole. After all you guys might be avid necklace crafters and also form an organization against drugs.

    (Reply) (Thread)