Why We Must Not End Prohibition

This came out about 16 July 2003 on Winds of Change and about the same Time on Sierra Times and The Rock River Times (dead trees).

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"The Latin American drug cartels have stretched their tentacles much deeper into our lives than most people believe. It's possible they are calling the shots at all levels of government."
- William Colby, former CIA Director, 1995

I know that enforcing prohibition sounds just like the opposite of what I have been preaching for years in my personal life, and for the last year in my blog posts and writings. There is a very sound reason for this new attitude. It is a very old reason: money. If we end the drug war, a lot of people whose livelihoods depend on it will get hurt. You might even be one of them...

I'm not talking your average street level drug dealer here, or the police officer who might not find a job because of reduced crime. I'm not even talking about the lawyers who will be looking for a new set of clients when the million or so people arrested for drug possession every year become rather ordinary citizens again.

I'm talking about your mother or grandmother whose stocks will drop like rocks when drug money no longer supports the stock market. Let us do what Deep Throat suggested and follow the money. The kind of money we are talking about is not your billion here and hundred million there. I'm talking big money. A trillion dollars a year. Or more. This is not your Cayman Island Bank type money or even Swiss Bank type money. This requires some place to dump the money where it won't be noticed. The biggest money laundering island in the world. Manhattan.

Why are stocks still selling at outrageous multiples despite a recession? Boom or bust the hot money has to go somewhere. The US of A has two things the hot money people desire, a stable currency and the ability to enforce its laws around the world. Think of what the hot money means to the American economy. A lot of ill thought out projects that turn out to be resource wasters get funded. But to the hot money people a decline of fifty percent means they still have laundered half their money. What a disaster for an honest business. What a great deal for hot money.

But America is addicted to this hot money. The ability to tolerate so much failure means America has to advance economically faster than any where else because we get efficient faster. This is one great American advantage over the rest of the world. We can let go of our failures. This is what bankruptcies and hot money do for the economy.

So we have this great engine for economic progress but it is fueled at its core by narco dollars. Do we root out the drug business by legalizing all drugs (with certain ones still under a doctors supervision) or do we keep prohibition with all its attendant miseries and racism going so our stock market and economic system doesn't collapse? Does the money mean more to us than doing the right thing? Is our world power so important that we need to keep this vicious game going? Would giving up this game hurt our enemies more than it would hurt us?

I first got turned on to these questions by reading a series of articles written by Catherine Austin Fitts. She is a former Assistant Secretary of the Federal Housing Commissioner under Bush 1, a former managing director and member of the board of directors of Dillon Read & Co, Inc. She is currently the President of an investment advisory firm Solari, Inc. The articles can be read here:

1. Narco Dollars 1
2. Narco Dollars 2
3. Narco Dollars 3

This week's saying: If the 1920s plus the 1990s teaches one thing it is this: "It's not the drugs stupid, its the prohibition." If the 2000s teach us nothing else, they will teach us: "Its not the drugs stupid, its the money."

Maybe it's time to start asking politicians:

"Do you support drug prohibition because it finances criminals at home, or because it finances terrorists abroad?"

This week's politician:

Senator Arlen Specter (Rep.)
PA Tel: 202-224-4254
fax: 202-228-1229

he also has an obnoxious web form instead of an e-mail.

Cross Posted at Classical Values