Illicit: How Smugglers, Traffickers, and Copycats are Hijacking the Global Economy
Illicit: How Smugglers, Traffickers, and Copycats are Hijacking the Global Economy
A groundbreaking investigation of how illicit commerce is altering the planet by transforming economies, reshaping politics, and capturing governments.In this fascinating and thorough examination of the underside of globalization, Moises Naím illuminates the struggle among traffickers and the hamstrung bureaucracies attempting to manage them. From illegal migrants to drugs to weapons to laundered funds to counterfeit goods, the black industry produces enormous earnings that are reinvested to cr
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Captivating!,
This is one of the the best books I have read this year. I could not stop reading it once I started. It combines jaw-dropping facts that we should all know-- but don't --with fascinating stories about how the globalization of smuggling is changing politics everywhere. As the Editor of The Economist writes in the back cover this book changes the way one sees the world. Naim is a great writer. Read this book.
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|Definitive Volume--$2T/Year and Growing, Lost Government Revenues,
I have known Moises Naim for many years, and admired his pragmatic approach to managing the content of Foreign Policy, as published under the auspices of the Canegie Endowment for International Peace. He has been Minister of Trade and Industry in Venezuela, a dean and professor of business administration, executive director of the World Bank, and an accomplished thinker and author. Above all he has been moral. He gets it: morality in politics and morality in business are priceless.
This book is important in two very big ways: the first, the one that most are noticing, is that it documents very ably the fact that crime pays--the author has done a superb job of itemizing the global illegal trade industry in a manner that could be understood by anyone, and the bottom line is frightening in that illicit trade is perhaps $2 trillion a year, while legal trade is between $5 trillion and $10 trillion. Off-the-books bartering and immoral invoicing within corporations are additional reducers of government tax revenue--import export tax fraud in the USA is known to be $50 billion a year ($25 rocket engines going out, $10 pencils coming in).
The second reason this book is important, the real value of this book, is in documenting the revenues lost to government. Legalizing prostitition has economic as well as public health implications. Reducing the arms trade, where the US is the greatest exporter of violence and bribery, has implications across ethnic conflict, stability, water and oil conservations, and so on. Eliminating counterfeiting and illegal immigration would have enormous implications for positive constructive government revenue. I personally know where $500 billion a year can be found in additional tax revenue for the US, mostly from eliminating pork barrel subsidies and corporate fraud, and by restoring the traditional share of corporations to the tax fund--when Halliburn pays $15M on billions in profit, when Exxon makes $3 billion in profit in a single quarter with no requisite tax bite, the system is broken. Eliminating crime, and corporate crime, provides the financial foundation for restoring the democratic contract, the social contract, with the working class and the middle class.
Moises Naim has, in brief, delivered the seminal work on one of the five factors that will determine how the human species does in its World War with itself and with bacteria. The other four factors are the end of cheap oil, the end of free water, the virulent re-emergence of infectuous diseases accompanied by the mutation and migration of new diseases from animal hosts to humans; and the promising but by no means assured emergence of collective democratic intelligence, perhaps aided by real-life decision support games such as those produced by BreakAwayLtd.com.
I consider Dr. Naim to be one of the most precious intellects now active--as penetrating but more pragmatic than Joe Nye, as strategic but more pragmatic as Zbigniew Brzezinski, as articulate but more pragmatic than my all time favorite strategist, Dr. Colin Gray from the United Kingdom.
Naim is a giant. He also represents, if I may be permitted an observation from my decades in Latin America and my Colombian-born mother, why Latin America is the future and why the US ignores the Chinese takeover of Latin American lands and resources, the Iranian penetrations, and the related Brazilian, Indian, Pakistani, and Russian incursions, at its peril. Latin America is both the source, and the solution, for most of the illicit trade that undermines the Republic. It's time we recognize that morality matters, crime is a greater threat than isolated terrorism, and Latin America is part of the Americas--the part that may achieve informed populist democracy before the USA recovers from the neo-conservative coup d'etat and ethical misadventures of a White House owned by Halliburton and dismissive of both the domestic and international publics.
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|The Bureaucracy vs. The Network,
Illicit bursts with detail and example, though it contains very little in the way of illustrative anecdotes. The author seems mainly concerned with communicating two main points. First, our conceptions about the nature and organizational structure of international trafficking networks has fallen dangerously out of date. Second, operating assumptions and ideological sacred cows prevent governments from framing the problem of illicit trafficking in a way that will allow for constructive action.
Concerning the first point, the "cartel and kingpin" conception of narco-trafficking formed and propagated in the 80's no longer applies. Our present counter-narcotics strategies assume that the enemy organization has a hierarchical structure with information and power flowing up and down a chain of command. In fact, trafficking organizations these days take the form of decentralized networks which shift continuously, assuming new configurations as opportunities present themselves and then morphing again to meet the needs of the next moment. Also, today's traffickers don`t specialize in a single commodity like cocaine. Instead, they move whatever goods present an opportunity for profit in the present moment; drugs today, arms tomorrow, people the next day and then knock-off designer handbags after that. Only the small players at the beginning and end of the supply chain specialize in particular products, e.g. the Bolivian coca farmer and the illegal immigrant selling bootlegged DVDs or knock-off Rolexes on the streets of New York.
The author's second point concerns two ideological sacred cows. First, he warns against the politically entrenched practice of talking about illicit traffic in strictly moral terms. Government officials denounce illicit traffickers as evil-doers rather than acknowledging that traffickers act from economic motives determined by market forces. Drugs and other illicit goods bring great financial reward when moved from one place where traffickers can purchase them at a low price to some other place where they command a high price. Adaptive systems like markets and networks make short work of the kinds of problems that prohibition-minded bureaucratic hierarchies place in their way. Talking about illicit trafficking in economic rather than moral terms would produce a more intelligent discussion and offer more effective courses of action.
Here and there throughout the early chapters, the author drops the occasional hint that he advocates legalizing marijuana, and at the book's end he makes that point explicit. In a free society marked by an ever-increasing volume of international trade, governments will have to pick their battles. Spending billions to try to interrupt the traffic in marijuana makes no sense if we hope to make any headway curtailing the trade in nuclear weapons technology, radiological materials and sex slaves. Don't mistake Naim for any kind of Libertarian. He makes it quite clear that he wants to see governments win the battle against illicit traffickers. He just knows that, realistically speaking, we have to prioritize, and that trying to keep millions of eager marijuana customers from millions of eager sellers serves no useful purpose and consumes resources that could otherwise be put to good use.
The other ideological sacred cow involves national sovereignty. Naim doesn't advocate subordinating the US federal government to the U.N., but he does call for much greater coordination of efforts with our closest allies, and such a move will entail some compromise of the absolute national sovereignty upon which the US government now insists.
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