CAPITALISM'S ACHILLES HEEL Dirty Money and How to

256 CAPITALISM’S ACHILLES HEEL
dictated by the World Bank and IMF, a country can then reach a “decision
point” at which a process of interim debt relief begins, leading to a “completion
point” at which further relief is proffered. This convoluted process
thus far has brought 27 countries to or past the decision point, qualifying
them eventually to receive a combined total of about $50 billion in debt
forgiveness. In other words, of the $1.5 trillion external debt presently
owed by severely and moderately indebted countries, the proudest accomplishment
of creditors under the HIPC Initiative extends to impoverished
countries the eventual prospect of cancellation of barely three percent of
their external obligations.
Over the past years, at the same time that western governments and
banks were lending money to poorer countries, western bankers and businesspeople
were helping corrupt government officials and private tax evaders
take money out of these countries. A U.S. banker related to me an incident
when his New York institution had two teams in a very heavily indebted
Latin American country at the same time, one comprising private bankers
seeking flight capital deposits and the other comprising debt collectors from
the international department seeking repayments.
Let me drive this point home, in terms that will be especially appreciated
by my friends in the World Presidents’ Organization and the Young
Presidents’ Organization, two groups of CEOs from all over the globe. 14 You
own or manage a good-sized company. You borrow a lot of money from a
bank. Soon the bank’s officers come quietly calling on your executives and
managers offering personal financial management services. This includes advice
on how to get money illegally out of the company and introductions to
suppliers or customers who can facilitate these subterfuges, with the bank
even offering to handle the paperwork between compromised employees
and their co-conspirators. Cash begins to disappear from your company.
This goes on for years, as your colleagues, their counterparts, and solicitous
bankers cover their tracks. The bank is pressing you to pay your debts, but
you can’t because the money is gone. Then you discover why. The bank itself
has been abetting theft from your company. Much of your firm’s cash is now
in private accounts belonging to your employees, deposited at the bank from
which your company borrowed heavily in the first place.
Do I need to carry this analogy to its logical conclusion? Not for my
tough-minded friends in WPO and YPO. It’ll be a cold day in hell when
those bankers ever try to collect their debt from you. They pulled the rug