Who Stole the American Dream?

The Heist: Who Stole the American Dream and How We Can Get It Back

Directed by Frances Causey and Donald Goldmacher (2012)

Film Review

The Heist traces the banking regulations Roosevelt enacted during the Great Depression – with the goal of preventing future economic cataclysms – and the systematic dismantling of this regulation that commenced in 1971. The documentary credits this deliberate attack on the financial regulatory system for the 2008 meltdown, the decimation of American unions, the total control of federal government by Wall Street corporations, and the most unequal economic system in the world.

The filmmakers date this orchestrated attack on US financial regulation to the Powell Memo,* which the Chamber of Commerce and Business Roundtable seized on to launch twelve right wing pro-business think tanks (including the CATO Institute, the American Enterprise Institutes and the Heritage Foundation). Funded by six families, these foundations were created with the deliberate aim of capturing business schools and the media with fundamentalist free market ideology. They proceeded to lobby all levels of government for tax cuts on the rich, as well as financing focus groups and psychologists to develop propaganda persuading blue collar workers to vote against their own interests.

In 1980, they succeeded in convincing large numbers of blue collar Democrats to vote for Reagan. In addition to implementing tax cuts for the rich that created the largest federal deficit in US history, Reagan also repealed the Fairness Doctrine,** opening the door to a radio talk show market 90% dominated by right wing talk show hosts like Rush Limbaugh.

Guided by the Powell Memo, right wing Democrat Bill Clinton repealed the Glass Steagall Act,***, deregulated derivatives trading, gutted the Federal Communication Commission’s authority to regulate media monopolies, and sped up the outsourcing of US jobs through the enactment of North American Free Trade Agreement (NAFTA), the Global Agreement on Tariffs and Trade (which created the World Trade Organization).

Obama would prove even more pro-business than Clinton, with his refusal to prosecute the banskters he bailed out, his appointment of GE CEO Jeffrey Imelt (a notorious job outsourcer) to head the President’s Council on Jobs and Competitiveness, his promotion of the myth that Social Security is insolvent, his deregulation of private pensions, and his support for the Transpacific Partnership (TPP).

The film features great clips from Elizabeth Warren, Bernie Sanders, Paul Craig Roberts and Ross Perot (speaking out against NAFTA during his 1992 presidential campaign).

---

* The Powell Memo was a memorandum Lewis Powell prepared at the request of the Chamber of Commerce. It remained secret until after his appointment to the Supreme Court. The Powell Memo

** The Fairness Doctrine was a policy of the United States Federal Communications Commission (FCC), introduced in 1949, requiring the holders of broadcast licenses both to present controversial issues of public importance and to do so in a manner that was—in the Commission’s view—honest, equitable, and balanced.

***The Glass–Steagall Act, passed by Congress in 1933, protected customers’ deposits by prohibiting commercial banks from engaging in investments. It was enacted as an emergency response to the failure of nearly 5,000 banks during the Great Depression.

 

 

An Insider’s View of Drug Smuggling

Smuggler: Roger Reaves a Memoir

by Roger Reaves

Marrie J Reaves Publishing (2016)

Book Review

Smuggler is an extremely unusual memoir by a 73 year old American who is currently serving a life sentence in Australia for drug smuggling. Written over fifteen years, it’s a highly detailed, journal-like memoir painting the author’s journey from excruciating rural poverty to high rolling international drug smuggler.

The reader comes away with the clear sense that despite government efforts to portray Reaves as a dangerous blood thirsty king pin, he was actually a lowly middleman who was regularly cheated and manipulated by the real king pins who engaged his services. While Reeves was highly successful (bringing in millions a month) during the first decade and a half of his career, a pattern emerged in which his clients routinely weasled out of paying him, shortchanged him on the quanity and/or quality of drugs they asked him to traffic, and/or provided him with mechanically faulty and dangerous aircraft and boats. Towards the end of his career, some were actively colluding with the DEA and FBI to entrap him.

Owing to the illegal nature of marijuana and cocaine trafficking a person has no comeback – except murder or serious physical injury – if a colleague cheats them. As the highly personal memoir makes clear, it wasn’t in Reaves’s nature to engage in lethal retaliation. This, perhaps, explains his failure to rise to the ranks of vicious psychopaths like Pablo Escobar.

For me the most interesting part of the book is the section where Reaves talks about his relationship with Barry Seal and the guaranteed “no-interception” cocaine delivery operation he had going at the Mena Airport – with the active approval and support of Arkansas governor Bill Clinton and Vice President George Herbert Walker Bush.

According to Reaves, there were only two delivery points in the US where traffickers could unload a shipment with absolute guarantee that neither Customs nor the DEA would bust them. Mena was one of them.

Reaves believes strongly that the War on Drugs is a racket perpetuated mainly for the benefit of Wall Street and illegal CIA military interventions. He advocates for the US and its allies to follow the example of Portugal, which has decriminalized all drugs. In Portugal, where possession of three grams of any drug is treated as a spot fine, crime rates have plummeted since the policy was implement in 2001 (see The Cato Institute and the Drug War).

Was Silk Road Founder Framed?

The Deep Web

Directed by Alex Winter (2015)

Film Review

The Deep Web is about the January 2015 trial of the alleged founder of the Silk Road website Ross Ulbricht. In addition to exploring Ulbricht’s background and the history of the Silk Road, the documentary also lays out some pretty revealing evidence US District Judge Katherine Forrest disallowed at trial. Ulbricht was sentenced to life imprisonment for drug sales, money laundering, hacking and engagement in a continuing criminal enterprise (kingpin charge). The filmmaker clearly believes Ulbricht was denied a fair trial.

The film begins by explaining what the Dark Web is, ie the unindexed records on the Internet. The Dark Web, which is thousands of times larger than the visible Internet, includes millions of bank records, as well as private and government administrative records. It also includes illicit sites like Silk Road.

Silk Road was created in 2011 by combining two cryptographic technologies: TOR (an open source technology originally developed by the US military), a browser that allows a user to access the Internet anonymously, and bitcoins, a cryptographically generated currency which, unlike bank-generated currency, is virtually untraceable.

Silk Road Founded as Political Statement

Silk Road didn’t actually buy or sell drugs. It simply provided a secure eBay-type marketplace where buyers and sellers could link up anonymously. Over time Silk Road developed an extremely tight knit user community that participated in the site’s political forums. One of the lead administrators, who took the screen name Dread Pirate Roberts (DPR)*, always maintained that Silk Road was less about selling drugs than making a political statement. DPR presented himself as a free market libertarian and talked a lot about resisting state efforts to control every aspect of our lives. All the Silk Road administrators were unified in their desire to end the war on drugs** and the extreme violence associated with it.

This fundamental nonviolent stance was reflected in their refusal to accept sellers offering products or services that caused people harm, such as prostitution or child pornography.

The Cryptoanarchist Movement

The Deep Web also provides interesting background on the radical cryptoanarchist movement that would eventually lead to the emergence of Wikileaks, Anonymous and Silk Road. A primary goal of this movement has been to create a world where the government can’t spy on everything we do. Members feel they have an implicit duty to develop encryption tools that non-tech savvy Internet users can employ to protect their privacy and anonymity.

Before the FBI shut it down in 2013, Silk Road had over one million registered users. According to cops, judges and FBI and DEA agents filmmakers interviewed, the site accomplished its goal in reducing violence associated with the drug trade.

Judge Disallows Evidence of FBI Crimes

The defense Ulbricht attempted to present was that he founded Silk Road but wasn’t Dread Pirate Roberts, as the prosecution claimed – that the individual using this screen name had taken over the website and framed him.

In March 2015, two federal agents were indicted (after a nine month investigation) for infiltrating Silk Road and stealing and extorting millions in bitcoins from Silk Road clients. These agents had high-level access to administrative functions of Silk Road, thanks to an administrator they arrested who turned informant. These federal agents had the power to change access to administrator platforms and passwords and to change PIN numbers and commandeer accounts, including that of DPR. They also had the means to manipulate logs, chats, private messages, keys, posts, account information and bank accounts. And they had the motive to alter data in order to cover up their own actions and point guilt elsewhere.

Judge Forrest barred Ulbricht’s attorney from presenting any of this evidence at trial.

She also disallowed evidence the FBI had illegally hacked into Silk Road’s servers in Iceland without a warrant – a violation of Fourth Amendment protections against illegal search and seizure. If her ruling is allowed to stand on appeal, it sets a dangerous precedent for allowing evidence resulting from illegal government hacking to be used at trial.

---

*Dread Pirate Roberts was a fictional character in the novel and movie The Princess Bride. In both, when the original Dread Pirate Roberts dies, his successor takes up the alias.
**The libertarian think tank Cato Institute has taken the position that the US should legalize all addictive drugs as Portugal has done. See The Cato Institute and the Drug War

For an update on Ulbricht’s appeal and to donate to his legal defense fund (like I did) go to
http://freeross.org/

The Cato Institute and the Drug War

A visit to the Cato Institute website can be a mind bending experience. Imagine my astonishment on discovering that that my views on drug reform are virtually identical to those of an conservative think tank.

The Cato Institute’s position is that the US should legalize – not decriminalize – all addictive drugs. They justify their viewpoint based on two comprehensive studies: the 2010 Drug Prohibition White Paper by Miron and Waldcock and the 2009 Drug Decriminalization in Portugal. by Glenn Greenwald (that’s right, the same  progressive Guardian columnist who first published whistleblower Edward Snowden’s NSA revelations in 2013).

An $88 Billion Windfall for Taxpayers

In addition to citing numerous studies showing that criminalization of drug abuse worsens the drug problem, the White Paper calculates that the US could save $41.3 billion dollars from legalizing addictive drugs, as well as collecting an additional $46.7 billion in revenue from regulating and taxing drugs of addiction. The difference between legalization and decriminalization is that drug smugglers and suppliers are still prosecuted under decriminalization. This, according to Cato, makes full legalization more beneficial to taxpayers, as permitting legal production and distribution of drugs allows them to be taxed.

The following is a brief breakdown of the financial benefits of drug legalization:

Savings

• State and local savings: $25.7 billion
• Federal savings: $15.6 billion
• Savings from legalizing marijuana: $8.7 billion
• Savings from legalizing other drugs of addiction: $32.6 billion

Tax Revenue

• Projected revenue from taxing marijuana: $8.7 billion
• Projected revenue from taxing other drugs of addiction: $38 billion

 

The Portuguese Experiment with Decriminalization

Drug Decriminalization in Portugal describes the Portuguese experiment with decriminalizing all addictive drugs in 2001. According to Greenwald, full legalization wasn’t an option, owing to international treaties Portugal had signed. Under the 2001 law, police issue citations to addicts, rather than arresting them. They then have 72 hours to report to a Dissuasion Commission, which can order a range of sanctions, including “absolution” (a finding that no drug abuse has occurred), a verbal warning, suspension of drivers and professional licenses, bans on visiting high risk locales or associating with known drug abusers, on-going monitoring for proof of abstinence, prohibition against foreign travel and suspension of welfare benefits.

Outcome studies show that the new law has resulted in surge in drug treatment in Portugal. Prior to 2001, the main barrier to treatment was addicts’ fear of arrest and prosecution. There has also been a clear reduction in drug abuse in the pre-adolescents and adolescents – a formative age group for behavioral patterns that are key determinants of future drug abuse.

The prediction by law and order proponents that decriminalization would lead to a massive increase in drug abuse never eventuated. Portuguese drug abuse rates, once among the highest in Europe, are now among the lowest. The other dire prediction, that druggies from all over Europe would flock to Portugal to get loaded, also proved unfounded. As of 2006, 95% of drug abusers receiving citations were Portuguese and 0% were from other European Union countries.

Cato, by the way, has found a way to save taxpayers another $180 billion by legalizing 8.3 million illegal immigrants. Go figure.

photo credit: guillermogg via photopin cc