Hot Money and the Politics of Debt

RT Naylor

McGill-Queens University Press (2004)

Book Review

Hot Money is about the trillions of dollars of global financial activity that is never recorded in official economic statistics. Corporate money laundering of illegal narcotics profits is the form of “hot money” that gets the most publicity. However according to Naylor, it accounts for a relatively small proportion of “hot money” percolating through offshore banks and dummy corporations.

Most “hot money” starts out as funds generated via “legitimate” business which rich elites sebd offshore to avoid taxes or in anticipation of economic calamity or regime change. All the world’s most ruthless dictators stashed funds in Swiss banks or similar financial havens prior to being deposed.

A sizeable chunk of hot money is generated from other illegal enterprises, such as gun running, illegal arms deals, prostitution, phony charities and religious groups (eg Reverend Moon’s Unification Church and L Ron Hubbard’s Church of Scientology) and government agencies (eg CIA) who use “hot money” to finance coups and insurgencies.

For me, the high point of Hot Money  is the excellent history Naylor provides of the CIA role in the world heroin and cocaine trade, especially their move to make Afghanistan the major global supplier of heroin.

Nalylor also provides a detailed history about the role of the Vatican Bank as a “hot money” center, the rise and fall of Propaganda Due (P2), a secret collaboration between the CIA, Mafia and right wing Masonic lodges that infiltrated all aspects of Italian public life in the 1970s; the role of Nazi war criminals Klaus Barbie and Josef Mengele in setting up Latin American death squads and cocaine networks; the rise and fall of the two biggest CIA banks, Australia’s Nugan Hand Bank and the Bank of Commerce and Credit International;  and the importance of “hot money” in the Iran Contra scandal, in which the Reagan administration illegally sold weapons to Iran to finance the Contra war against Nicaragua.

The most shocking chapter describes the role of the Nugan Hand Bank in funding a bloodless coup US Naval Intelligence carried out against Australia in 1972 – to remove a prime minister whose political views were inconsistent with US interests. Most Americans are totally unaware of this heinous attack against a close US ally. I’ve only learned of it since moving to New Zealand (Australia is New Zealand’s closest neighbor).

Comments
  1. marblenecltr says:

    The monster seeking control of our world is very old and has been attacking the United States from 1776. Coming somewhat up to date, a military coup was attempted against President F. D. Roosevelt early in his first administration. A successful coup was carried out on November 22, 1963. We have been sliding downhill at greater speed every year since then.

    • I’m with you there, marblenecltr. I’ve spent most of the last 7 years trying to unlearn all the history I was taught in school in order to get a clear idea of how we got into this mess. It’s a daily struggle. Thanks for reblogging.

  2. marblenecltr says:

    Reblogged this on necltr and commented:
    People of countries with advanced civilization, pray that our toys are never taken away.

  3. auntyuta says:

    As an Australian I’ll never get over the dismissal of the Whitlam government.
    The following I googled:

    http://whitlamdismissal.com/

    Resources, documents and updated news about the Dismissal of the Whitlam Government on November 11, 1975.
    Gough Whitlam – Australia’s PMs – Australia’s Prime Ministers
    primeministers.naa.gov.au › Australia’s PMs
    Gough Whitlam became Australia’s 21st Prime Minister on 5 December 1972. His Labor government, the first after more than two decades, set out to change …

  4. Wow, more hidden history, Dr. Bramhall. This is news for me.

  5. It’s incredibly demoralizing, Rosaliene. Suddenly I understand why the New Zealand government allows the US to lead them around by the nose.

  6. marblenecltr says:

    President Kennedy sought to raise other nations up to our level through the Peace Corps and other means. The military-industrial complex ended that. The Shadow Masters seek to not only bring the United States down to a uniform level held by all countries, it wants to bring the basement floor lower than it is today. A very few are seeking globalised feudalism over the five hundred million they may allow to live after their psychopathic global “culling of the herd.” We are seeing attempts at power’s absolute corruption.

  7. Alan Scott says:

    Yes. As auntyuta points out, Gough Whitlam’s Labour government was elected in 1972 and ousted in 1975. I didn’t know about the US involvement, but it doesn’t surprise me at all. As I recall there was a stalemate in parliament about granting supply to the government, the Queen’s loyal governor-general stepped in, sacked Whitlam, and Australian voters duly elected Malcolm Fraser’s conservatives. End of story. It surprised me how willingly Aussies accepted the situation at the time.

    Interestingly, NZ had a Labour government at the same time – which disintegrated after the untimely death of charismatic PM Big Norm Kirk. Coincidence?

    • Interesting question, Alan. It’s much harder to find good information about US meddling in New Zealand politics. There’s no question that the current National government behaves like a US lapdog in nearly every foreign and trade policy. It’s hard to know if this is US intelligence meddling (what I do know is that the NSA directly funds one intelligence position in Wellington). Or if the Kiwi elites are simply afraid of Wall Street attacking our currency or launching a Whitlam-style coup if we don’t go along.

  8. Well I guess that explains it. I’m really struggling with understanding the current National bill to make water fluoridation mandatory. I’m told by leaders in Fluoride Action Network NZ that this stems mainly from US pressure – even though all the hydrofluorosilicic acid current used in fluoridatng NZ community water supplies is manufactured by an Australian company called Ixom. I can’t for the life of me imagine what the US gains by pressuring New Zealand to fluoridate their water.

    In 2011 a local community group successfully lobbied New Plymouth District Council to stop fluoridating our water – but it will be fluoridated again if this bill passes.

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