CAPITALISM'S ACHILLES HEEL Dirty Money and How to

138 CAPITALISM’S ACHILLES HEEL
You would also think, given worries about terrorists’ laundering
money, that the Administration would welcome closer international information-sharing
among banking and tax authorities. But evidently tax
favoritism for corporations and high-bracket individuals trumps even
antiterrorism. 163
Beyond legal issues and beyond domestic interests is the question of
western capitalism’s relationship to the rest of the world. Falsified pricing,
haven and secrecy structures, and the illicit movement of trillions of dollars
out of developing and transitional economies break the social contract, however
it may be defined, that Adam Smith incorporated into the core of the
free-market system. The following pages demonstrate some of these concerns
with illustrations drawn from Congo, commercially exploited for
many years, and China and Russia, transitional economies with the greatest
illegal outflows of money ever seen.
Congo
As the forces of decolonization swept Africa in the 1950s, Belgium granted
independence to the Congo on June 30, 1960, and the country immediately
descended into chaos. Colonel Joseph Mobutu, commander of the Congo
army and acting with CIA encouragement, temporarily took over the government
in September. After he relinquished control, rebellions erupted,
mercenaries poured into the vacuum, and the central government teetered,
leading Mobutu to return to power in 1965 and declare himself president.
Having learned his lessons well from studying the Belgian colonialists,
Mobutu, already a millionaire from foreign bribes, launched one of the most
incredibly venal regimes of modern times. Congo sank into what has been
called “the gloomy vision of a Hobbesian state of nature.” 164 A council of local
prelates characterized commerce in their country as “organized pillage for
the profit of the foreigner and his intermediaries.” 165
Indeed, there was much to pillage. Besides copper and gold, Mobutu’s
Congo, the size of the United States east of the Mississippi River, was a major
producer of diamonds, cobalt, tin, tungsten, zinc, silver, uranium, lead,
iron ore, coal, manganese, and a bit of oil. Congo also had a reasonable agricultural
base and exported rubber, timber, palm oil, coconut, coffee, cocoa,
and tobacco. Mobutu profited directly from export transactions, by receiv-