Crime INC: the global take over
Beatrice E Rangel
In 2010 at the launch of the report, The Globalization of Crime: A Transnational Organized Crime Threat Assessment, Antonio Maria Costa, Executive Director of the United Nations Office on Drugs and Crime (UNODC) indicated “Organized crime has globalized and turned into one of the world’s foremost economic and armed powers“.
He was yet to experience Culiacan where a plainclothes army disrupted the arrest of Ovidio Guzman, son and business heir to el CHAPO currently serving a life sentence in the US . The operation was both successful and truly awesome. Mr Guzman’s security detail first resisted the arrest, then organized the retrieval from the detention site. Over one hundred people were involved in the stint was not only flawless but executed with effectiveness and precision.
In 12 minutes, the Guzman army was able to paralyze Culiacan; isolate the army platoon that had arrested Ismael Guzman; rendered impossible the arrival of support from the Mexican army by means of blowing up a helicopter with an earth-wind missile and blocking the access roads to the city. They then proceeded to retrieve their injured and dead to disappear with Mr Guzman on board. Afterwards a profoundly disturbed and diminished President of Mexico took responsibility for the release of Guzman on the grounds of avoiding a blood bath in Culiacan.
Truth of the matter is that Culiacan will enter history as the event that laid plain and clear an ugly reality that most would like to continue ignoring organized crime is a geopolitical reality that can confront and defeat a nation state. And while this development has been the object of research by the Council on Foreign Relations the National Criminal Justice Reference System and the United Nations Office on Drugs and Crime (UNODC) the world had not seen live through images the takeover. Well, it just happened in Culiacan. Now the drug lords know that the Mexican government can be corralled into allowing them to conduct their illicit activities by deploying their full military power.
Some may wonder how this happened. Well, the story goes back to the 1950s when wrong economic policies that prevented consumers from attaining their Paretto optimum created the conditions for the well to do in Latin America to pay smugglers to access home appliances manufactured in the US with a high margin of profits for the smugglers but at prices that where much less than those for appliances manufactured South of the Rio Grande. From the viewpoint of consumes the relation price /quality was superior to appliances manufactured in their home countries.
Same policies applied to cars, yachts and everything that moves. A very efficient and effective logistics network was created by smugglers who prospered to become the pioneers of most department stores in Latin America. With the Flower Power generation, the US market turned into drugs consumption wholesale. The networks created by smugglers switched gears as they were taken over by drug producers and dealers. The difference between appliances and drugs is in the margin. While a refrigerator can generate a 60%- 80% margin; drugs produce a 100% margin. Thus, the cash volumes are huge.
As drugs were declared illicit everywhere in the world its production and distribution demanded protection in the form of private armies and extortion money. As drug gangs armed themselves and began buying out politicians and law enforcement officials organized crime began to penetrate the nation state. This is particularly easy in fragile states. Fragile states lack resources to exert territorial control and to deliver public services including security. When states fail to deliver public services and security, criminals fill the vacuum.
Organized crime then developed a new form of geopolitics which according to UNODC “differs in many respects from traditional geopolitics in which control of natural resources and critical geographical areas was central to success. Today’s criminal organizations are able to thrive on the political weakness and breakdown of authority that have been occurring in a number of countries since the 1980s”. It is no coincidence, says UNODC, that the “era of the failed nation-State is also the era of organized transnational crime”.
Failed states act as operational bases for Crime INC or as was recently put by Steve Wilson the head of Europol “The problem we see now is that … you can be nation-state by day, organized crime by night. You have a mandate to operate as long as you don’t do anything in your own country,”. This poses a problem qualitatively different from the past.
Enter globalization and you have a superior form of organized crime. The traditional bounded village culture and familial blood ties that provide the organizational glue to gangs that sprout all over the slums of emerging markets and are the incipient forms of organized crime mutate into sophisticated networks as they travel to other latitudes. As these groups settle abroad, they become part of a more sophisticated organizational form that connects them to a commanding center through capital, technology, access to multiple identities, rapid transportation, and cross-border mobility.
International demand for drugs, arms, money laundering, counterfeiting, illicit trade in stolen goods, pornography, terrorism, and computer-related crime generate enough resources to support the commanding center. In addition, loose cross-group alliances are increasingly occurring between different nationally rooted organized criminal groups; for example, Colombians, Italians, Nigerians, Bulgarians, Syrians, Turks and Russians associate in drug enterprises.
Meanwhile nation states are tied in this asymmetrical fight by the principles of sovereignty, protection of human rights, international regulations on war and conflicts and more notably by lack of resources to effectively take on the challenge of confronting this global threat to peace and security.
The answer thus revolves around the strengthening of the UN Convention against Transnational Organized Crime. Increased cooperation among central banks and law enforcement and of course establishing sanctions to those economic agents operating in failed states would be part of an initial response. But the issue of institutional fragility and market averse economic policies cannot be forgotten.
To be sure perhaps the time has come to revert the UN role as the guarantor of self-determination. This policy has led to the proliferation of nation states that cannot sustain themselves and are prime targets for organized crime to establish its operational bases. From 1979 to today the UN has gone from 103 members to 190 members.
About 35% of these members are considered by the UN Economic and Social Council as fragile. The question arises whether by means of recognizing as nations states communities that cannot sustain themselves, is the UN not creating conditions for the spread of transnational organized crime?
Should the events in Culiacan not produce a revisiting of international rules preventing the internationalization of law enforcement, the strengthening of the UNCTOC and the change in the rules to establish nation states the fight against organized crime seems to be uphill.
Published by laht.com on October 21st., 2019
*The opinions published herein are the sole responsibility of its author.*
Beatrice Rangel is President & CEO of the AMLA Consulting Group, which provides growth and partnership opportunities in US and Hispanic markets. AMLA identifies the best potential partner for businesses which are eager to exploit the growing buying power of the US Hispanic market and for US Corporations seeking to find investment partners in Latin America. Previously, she was Chief of Staff for Venezuela President Carlos Andres Perez as well as Chief Strategist for the Cisneros Group of Companies.For her work throughout Latin America, Rangel has been honored with the Order of Merit of May from Argentina, the Condor of the Andes Order from Bolivia, the Bernardo O’Higgins Order by Chile, the Order of Boyaca from Colombia, and the National Order of Jose Matías Delgado from El Salvador.