International Organized Crime: Capitalism at Its Finest?

Misha Glenny’s ‘McMafia’, left me confused, uncertain, self-reflective and, I think, better off than it found me. Shattering preconceived notions and world-views in light of new information, while sometimes discomforting is, I think, a large part of what drives forward human society. While any one person’s world-view may only be able to stretch and bend within certain limits, over time and between lifetimes, quite dramatic shifts in views about the natural and (a subset of it, the social world) emerge. But that’s another post.

Strangely, despite the brutality portrayed in the intertwining threads that the book weaved together, I became impressed by the efficiency and organization of global criminal networks. In the same way that one might study medieval torture techniques with a sense of both fascination and disgust, I found that they are, it seems to me, the purist form of capitalism in existence. This was difficult for me to accept at first as I am a firm believer in the efficiency of the free-market as an economic system compared to any other system yet deployed. There are certainly winners and losers, those who the markets have failed, this cannot be argued (and often this is a result of chance rather than personal choices or talents), but its overall delivery of human happiness is, I think, unparalleled in human history.

But it is both the liberalization of the global economy over the past twenty years, in line with the ‘Washington Consensus’, combined with limits to that liberalization in the form of laws against such activities as drug production and use and prostitution, combined with a world with globally fragmented tax and financial regulatory system, which make such internally organized crime not only possible, but inevitable. Therefore, it is the global economic, legal, and financial systems which allow for the emergence of deeply embedded and destructive organized crime, rather than, to put it bluntly ‘bad guys’. In fact, I would argue, many of those involved criminal activities would prefer not to live in constant fear of violence and life-long prison sentences. But, in a world where material opulence can be achieved faster and with higher probability through illicit capitalism than licit capitalism, the choice for those in a position to exploit illicit activity, is obvious.

Glenny makes the case that the War on Drugs and the War on Terror are hopelessly, and almost comically paradoxical, as the War on Drugs drives this market underground where financial flows cannot be traced, and into the hands of terrorist enterprises. With respect to the global economic system, the reduction of regulation in the flow of wealth and goods around the world following the collapse of the Soviet Union has eased the process of the globalization of organized crime. Finally, disparate tax systems in various countries around the world create safe havens for locating capital, in some cases intentionally created to attract wealth to a particular country or region.

I could not agree more with Glenny’s conclusion that the interconnectedness between the economic, legal and financial systems, and the trend towards an increasingly globalized and capitalistic world (a positive one in my view) makes global governance of these systems a precursor to addressing this and, by extension, all global challenges.

By Rob Hickey


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