CAPITALISM'S ACHILLES HEEL Dirty Money and How to

258 CAPITALISM’S ACHILLES HEEL
Consider, for example, an initial amount of $100 billion a year remaining
in the poorer countries. It could stay in private hands or public hands or
a combination of the two. If it remained in private hands it could:
• Be spent on consumption, contributing a multiplier effect through
the economy as the same money gets respent.
• Be invested in shops, properties, and factories, employing millions
and again producing a return on investment for these economies.
• Be deposited in banks, enabling a comparable amount of loans to be
made.
• Be used to capitalize banks, where the money could be leveraged to
approximately $1.25 trillion in loan funds under normal capital adequacy
ratios. 15
In a combination of private and public hands, what could be done with
$100 billion annually? How about what is shown in Table 6.2 drawn from
UN, World Bank, and other sources?
Some of these items are not necessarily a straight multiplication when
scaled up to $200, $300, $400, or $500 billion or more annually, but the
thrust of the point is clear. Leaving money in poorer countries does more
good in these economies than any other step that can be taken, strengthening
health, education, consumption, investment, growth, and in all likelihood
democracy and stability.
Indeed, what if?
INTELLECTUAL GAP OR CHARACTER GAP?
Within days after arriving in Africa for the first time in 1961, I became
aware that financial chicanery and abject poverty are somehow related. Fastforward
several decades. One World Bank official says to me, “I don’t understand
the linkage.” Another aid official, well aware of the relationship,
implores, “Don’t tell anyone.”
What is happening here? Is it a failure of analysis or a failure of courage?
Or, worst of all worlds, is it a failure of both?
After announcing his resignation as chief economist at the World Bank,