An open letter to Mike Ruppert

As many of you may have heard, Michael C. Ruppert took his own life this past Sunday evening after his radio program The Lifeboat Hour aired on PRN. I sent a short version of this email to him – a busy news analyst – on November 7th of 2013. I kept the long version for a book I’m working on but today I felt inclined to share it. I hope it brings some comfort to those who loved him and respected his work, which meant so much to so many. The Refreshment Center changed significantly since I met him, but it simply wouldn’t have existed at all without his contribution & commitment to high standards in investigative journalism. He was one helluva mentor. RIP Ruppert Bear. ~ Gabrielle Price

A letter to Mike Ruppert


Greetings, Mike – I hope this finds you well. I’ve been incredibly busy on the new homestead after years wandering and trying to find my place. My time here may be short-lived but it is a welcome respite, especially now, and I am making no small plans for this place.

I’m writing in regards to your last radio show with Carloyn Baker and I was very pleased to hear the band Puscifer during the break. I’ve followed Maynard’s career for awhile and I was reminded of a post I made at The Refreshment Center in 2010. It has many more views than most, except for a short screed on anarchy that was juvenile at best when I wrote it.

I wanted to share this post with you personally, rather than on social media because it is personal to me and reminds me of a time when I had sequestered myself away from what Krishnamurti would call our ‘sick society’. I had my longest ‘dark night of the soul’ as it were. There have been others, but this one was the mother of them all. I hope you will entertain my telling a short story.

Long before Occupy, I had read ‘Crossing the Rubicon’ after the BP Disaster and later watched Collapse with a former roommate. During the film, you mentioned ‘finding your tribe and gathering your friends’ – he paused the film and told me he was very glad I was there. I was, too. We made plans and worked well together, sharing data and researching into the wee hours, planning a garden and keeping an eye on events that were just coming to light in Greece.

Unfortunately, our bond of friendship wasn’t as strong as his love of alcohol and need for repetitive fighting. It was traumatic on many levels. My daughter and I had to leave less than two months after I viewed Collapse. From that point, I had to walk away from my former life and friends because they were barely familiar. Stung by this experience before for different reasons [‘cliques’, ‘art snobs’ and ‘self-proclaimed gurus’ among them]…this experience was vastly different. Your work gave me two gifts: My freedom from mental slavery and the realization of why I was left uninspired by this culture. The things I saw and heard being passed off as art, spoke nothing about the world we actually live in. I began the hard work of decolonization of self.

After reading Rubicon, a fine work but I admit it was when I heard your voice in Collapse that the ‘bell rang’ out in my soul. It resonated with startling clarity what I had already known…that everything is connected. I felt this in the ‘inner’ before but was grasping to figure out what the ‘outer’ connection was that drew us all toward this coming shift. I credit you and your teachers for this part of my awakening. Gratitude matters a great deal to me and I’d be not worth my salt without thanking you personally for this foundation-breaking epiphany.

It was this epiphany that compelled me to sequester myself in a hotel room for six months. My daughter moved before this and I was able to make the decision to stay by the grace of friends I met online and knew your work. I had been practicing meditation a few years by that time and what I learned resonated loudly enough for me to take the drastic measure of leaving behind my comfort zone. To turn down the volume, study your methods…learn how to investigate, how to dig, how to pluck out the ice cream from the BS [as you once said]. And I’m quite sure many believed I had lost my mind.

It was also during this time that a long-distance relationship deepened. A man who knew me well and loved me deeply enough to encourage the work I was doing, whether he understood it or not. I’d never experienced this before and it was not for me to question the when or why of the gift, I simply surrendered to it. I found a love – my beloved – who encouraged me to become what I had always wanted to be: a writer. He was far away and I missed him often but I never felt lonely. Love like that made me stronger when many would have quit. I found I was not afraid of solitude. In fact, it was a blessed gift.

My time in what Bukowski may have called a palace [compared to his ‘cold water flats’] to connect more dots and develop my intuition, this following blog post was born. Occupy came soon after and a year later, it was through this rushing wave of awakening that I found myself on your doorstep, interviewing you at your home in Sebastopol, holding my signed copy of Rubicon and leaving a rose quartz in your garden.

There is, of course, so much more to this story. I hope you’ll honor me by reading it one day but please know these experiences taught me that nothing is coincidence to those who trust the path of spirit, brother. Nothing.

Heaven is for those afraid of hell – to be spiritual is to have gone through hell. I believe that as much as I believe I was led to the place I am blessed to be in now. I try to help every soul I meet that carries the heavy load of this ‘sick society’ knowing much of that suffering is illusory. The weight of shackles we do not own but many call a birthright. It’s this idea of ownership that validates the absurd notion that man can rightfully own the earth.

This ‘theater of the absurd’ is older than the Buddha. The earth is older still and we must all be her witness now. Her suffering is our suffering.

An old Swedish proverb that holds true as much as it did when I heard it in my youth, “Shared joy is double joy. Shared sorrow, only half a sorrow.”  Thank you for sharing both and the courage to bear witness to the atrocities of this dying age. It has made me appreciate the beauty of all life more acutely, not just through my camera lens. I recognize the sacredness of simple pleasures. The jewels contained within a simple life.

My friend, such treasures we’ve had all along! We’re all so much richer than this paradigm wants us to know…and I found that’s where my work finally met spirit. What a blessing to get here. Some of us just have to take the long way home, I reckon.

I honor your journey and I wish you peace, Mike. For every envelope you pushed and trail you blazed, I thank you. I’m honored that spirit saw fit for us to meet upon the path.

Enjoy : Sacred Math and The Sacred Hoop [with Tool song Lateralus]

With love and respect,



Spiral out, Brother Mike. We’ll keep going.


BARACK OBAMA’S speech was weak, utterly lacking in compelling (or even admissible) evidence and unconvincing, especially to the world.

He’s looking for a way out and Russia appears to be in the driver’s seat with respect to diplomacy. Barack the Bloody has openly vowed compliance with international law. He has committed himself to exploring and pursuing the diplomatic solution… which means he has backed down. He has lost inertia and initiative.

There will be no 9-11 false flag attacks. The situation is too tense, too tinder dry. My guess is that the Obama administration is hoping for this to die down in intensity so it can be swept under the rug and proclaimed a victory.

But what I foresee is a crushing and humiliating defeat for the U.S. at the UN when the inspection reports come in and as more and more evidence piles up that the Assad regime did not use the gas, that this was a false-flag perpetrated by U.S. and allies. The UN can, and probably will demand presentation of the thus-far missing evidence. John Kerry is about to have his head handed to him if that happens.

You can’t yank the world around like this.

You can’t yank people around like this.

We are not going though weeks and months of this.

And just maybe, seven billion of us are beginning to realize that we can put an end to this.

Si se puede!

~ Michael C. Ruppert [3 minutes ago]

Michael C. Ruppert Interview on Media Mayhem

submitted by Gabrielle Price
h/t to Media Mayhem on The Lip TV

[Having taken a hiatus while working on other projects locally, I would be totally remiss not to share this outstanding interview with my readers.  Mike has been an incredible inspiration to me personally and his life’s work an enormous contribution to anyone in journalism who cares deeply about the truth, nowhere to be found in corporate media. He speaks with authority because he’s earned that authority and this is the best interview I’ve seen with him since I began studying peak oil. It is a must see…but leave your cognitive dissonance at the door. Sat nam, Mike.]

Michael Ruppert is an investigative journalist and author of two books, Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil and Confronting Collapse: The Crisis of Energy and Money in a Post Peak Oil World. In the 1970s, Ruppert was a narcotics officer for the LAPD. While there, he discovered evidence that the CIA was complicit in the illegal drug trade. He alerted his superiors with this information and soon found himself dismissed even though he had an honorable record. These events spurred Ruppert to begin a new career for himself as an investigative journalist. He was the publisher/editor of the From The Wilderness newsletter which, until its closure in 2006, examined government corruption and complicity in such areas as the CIA’s involvement in the war on drugs, the Pat Tillman scandal, the 2008 economic collapse and issues surrounding Peak Oil. Ruppert has lectured widely on these topics and was the subject of a documentary, Collapse, in 2009 which was based on one of his books. Currently, he hosts the radio show, The Lifeboat Hour, on the Progressive Radio Network.

Part one:  Mike discusses getting persecuted as a journalist over Pat Tilman, the Bush administration, Pat Tilman cover-up, media red herrings and distractions from the Right and Left, collapse, peak oil and the Iraq War, Christopher Dorner and how investigative journalism appears through the cracks.

Part two: Mike picks right back up again with topics like Osama Bin Laden and the truth, 9/11 and Dick Cheney, and evidence for his case against Cheney. The excuse for the Iraq War, and the connection to Pearl Harbor, Halliburton, working with the LAPD and C.I.A. and coming from a background related to security, and more.

Unholy Trinity / Part Three

Excerpts from Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil
Published in 2004 / Chapter 3

The CIA Is Wall Street, And Drug Money Is King

by Michael C. Ruppert
[w/his permission]

The smoking gun

As the national controversy raged over the Gary Webb stories from 1996 through 1998, pieces of evidence started to leak into the public domain.  One piece, a 1981 letter from from then US Attorney General William French Smith to Director of Central Intelligence (DCI) Bill Casey, summarized the results of a long negotiation process that changed the CIA’s obligations under the law when people who worked for it were caught dealing drugs.

It had previously been a requirement under Title 18 of the US Code that, whenever a manager or department of the executive branch discovered that an employee was breaking the law, an immediate notification to the US Department of Justice or one of its enforcement agencies had to be made.  In 1981, at the start of the Contra War the CIA had a problem.  It knew that the coming covert operations were going to witness a dramatic explosion in the volume of cocaine entering the States.  It needed not only a cover for itself but also a legal way to circumvent what was sure to be a deluge of reports (which did occur) about US government personnel or contractors who were moving drugs.

In a two-stage negotiation process, the CIA and the Department of Justice first made an arbitrary decision that anyone who worked for the CIA (whether a full-time employee or contractor or employee of a CIA proprietary company) who did not hold “officer” rank within the agency was deemed not to be an employee.  In the next stage, it was decided that “no formal requirement” for the reporting of violations of drug laws was going to be required under the newly reached memorandum of understanding.

Proof of this surfaced when a copy of the letter formalizing the agreement was sent anonymously to the office of Congresswoman Maxine Waters when she was still championing the issue.  A key sentence in the letter said, “In light of these provisions, and in view of the fine cooperation the Drug Enforcement Administration has received from the CIA, no formal requirement regarding the reporting of narcotics violations has been included in these procedures.”  With the stroke of a pen the CIA had been absolved from turning in its employees, its contractors, and the employees of its proprietary companies who were soon to be found smuggling cocaine, hand over fist, and airplane over cargo ship.

A copy of this letter was inserted in the CIA’s final inspector general (IG) report in October 1998, long after the nation had forgotten the issue and become lost in Monika Lewisky’s dress.

Click to enlarge

The smoking airplanes

Click for specs

In the 1980s and the 1990s the Central Intelligence Agency schemed to move a number of large C-130 Hercules transports from US government ownership into the hands of private contractors so that some of them could be used for covert operations that were “deniable” by the Agency.  The C-130 is a military aircraft, and it is banned from export without State Department certifications.  Under the CIA plan, some 28 of the giant transports were moved from the Department of Defense into the hands of the US Forest Service.  From there, ostensibly for the humanitarian purpose of fighting forest fires, they were again transferred into the hands of private contractors, many of whom were later revealed to have CIA connections or contracts, or established relationships with CIA proprietaries.

The scheme started to come unraveled as a number of investigators, including Vietnam veteran Gary Eitel, himself a pilot, began turning up documents in court cases showing links to the Agency.  The cases were extremely well covered by mainstream press; they prompted stories in the AP and a large series in the Riverside Press Enterprise by veteran reporter Dave Hendricks.  The problem was that many of the C-130s kept turning up in such remote locations as Panama, Mexico, Colombia, Angola, and the Middle East.  In many cases, when they were examined, they were carrying anything but fire retardant.  In fact, one of the C-130s, connected to CIA affiliate T&G Aviation of Arizona, was seized in 1994 with a billion dollars worth of cocaine on board.  Eitel’s investigation had established a connection between T&G, operated by Woody Grantham, and another company called Trans Latin Air.

The Trans Latin Air investigation led to an investigation of Aero Postale de Mexico. In April of 1998 stories in the Mexican paper La Reforma reported that the Mexican Attorney General had indicted three officials of the private freight hauling company Aero Postale de Mexico which routinely delivered mail and other goods throughout Latin and Central America on charges that they had provided aircraft to the drug cartel headed by the Arellano Felix brothers.  That investigation had commenced in 1997, and Aero Postale planes were reportedly hauling multi-thousand kilo loads of cocaine during the period.  One of the C-130s was impounded at the Mexico City airport. Purchase of the aircraft was financed by the Mexican banker Carlos Cabal, who was assured repayment of the loans by the US Import-Export Bank.  It is impossible to believe CIA would not have noticed such a transaction.  T&G sold the planes to Aero Postale in 1993 at the same time he sold the planes to Trans Latin Air.

Records of the massive cocaine bust, though suppressed by the major media, did get introduced into evidence in a major drug prosecution in Chicago that same year.

The heat had started to fall on the Forest Service five years earlier when the planes first started getting caught with drugs aboard during Contra support operations.  The Forest Service had their lawyers evaluate the situation in the perennial government game of CYA.  As a result, one of the most chilling documents to ever reveal the depth of government cynicism emerged into public light.  A 1989 memo (below) from a Forest Service lawyer to Associate Chief George Leonard concluded, “Apparently, DoD [the Pentagon, CIA’s name never appears on documents like this] thinks that by having the Forest Service as the intermediary, if any future aircraft are used in drug smuggling, the Forest Service and not the DoD will suffer the adverse publicity.”

Click to enlarge

The smoking Inspector General report

I could fill this book with excerpts from the CIA IG report, written by Frederick P. Hitz and released on October 8, 1988 – the same day that the impeachment of Bill Clinton began in the House.  To demonstrate what kind of material is in that report, I will include just three brief quotations.  The number in front of each paragraph refers to its location in the IG report.

490.  On March 25, 1987, CIA questioned [Moises] Nunez about narcotics trafficking allegations against him.  Nunez revealed that since 1985, he had engaged in a clandestine relationship with the National Security Council (NSC).

Nunez refused to elaborate on the nature of these actions, but indicated it was difficult to answer questions relating to his involvement in narcotics trafficking because of specific tasks he had performed at the direction of the NSC.  Nunez refused to identify the NSC officials with whom he had been involved. [Note: Oliver North was the NSC point man for all Contra support activities.]

491.  Headquarters cabled in April in 1987 that a decision had been made to “debrief” Nunez regarding the revelations he had made.  The next day however, a Headquarters cable stated that “Headquarters had decided against… debriefing Nunez.”

The cable offered no explanation for the decision.

Another key passage discussing a Honduran airline documented to be moving as much as four tons of cocaine a month found that:

816.  SETCO was chosen by NHAO [Nicaraguan Humanitarian Assistance Office, at the time coordinated by former National Security staffer, Elliot Abrams] to transport goods on behalf of the Contras from late 1985 through mid-1986. According to testimony by FDN leader Adolfo Calero before the Iran-Contra committees, SETCO received funds for Contra supply operations from the bank accounts that were established by Oliver North.

And finally, the CIA acknowledged in its IG report that it had withheld information about drug trafficking operations involved in the Contra effort from Congress, at the same time revealing that:

1074.  The analyst who drafted a Memorandum for Vice President Bush in April 1986 that related to potential Contras’ involvement in drug trafficking recalls that OGI analysts who worked on counternartcotics issues were not aware of those reports at the time – October to December 1984 – that they were first disseminated inside and outside the Agency.  However, she says that CATF [Central American Task Force] Chief [Alan] Fiers did make the reporting available to her in April 1986, stipulating that it could be used only for the Memorandum she was preparing for Vice President Bush.

1084.  1986 Memorandum for Vice President Bush.  On April 6, 1986, a Memorandum entitled, “Contra Involvement in Drug Trafficking” was prepared by CIA at the request of Vice President Bush.  The Memorandum provided a summary of information that had been received in late 1984 regarding the alleged agreement between Southern Front Contra leader Eden Pastora’s associates and Miami-based drug trafficker Jorge Morales. Morales reportedly had offered financial and aircraft support for the Contras in exchange for FRS pilots to “transship” Colombian cocaine to the United States.  CIA disseminated this memorandum only to the Vice President.

The importance of this revelation is that it had been the official position of then Vice President Bush that he had no hands-on relationship with the Contras, was out of the loop, and knew nothing. That’s the position he took with the press, with Congress, and with the American people.

[G ~ Also consider Papa Bush was Director of the CIA before he became VP.]

The smoking history

The CIA has been dealing drugs since before it was the CIA; already in its first days, as the OSS during World War II it was facilitating and managing the trade, and directing its criminal proceeds to the places of its master’s choosing.  for additional reading on the subject I recommend three excellent books The Politics of Heroin: CIA Complicity in the Global Drug Trade by Alfred McCoy, 1991, Cocaine Politics: Drugs, Armies, and the CIA in Central America, Updated Edition by Peter Dale Scott, 1991, and Powderburns: Cocaine, Contras & the Drug War by Celerino Castillo, 1994.  The use of the drug trade to secure economic advantage for an imperialist nations is at least as old as the British East India Company’s first smuggling of opium into China in the late 1600s (the defense of that British practice, Scott points out, was John Stuart Mill’s motivation for writing the tract “On Liberty”).  They did that for 300 years.  When something works that well, the ruling elites rarely let go of it.

An interesting end came to the investigation arising out of the Gary Webb stories that (re)started all the controversy about the CIA and drugs.  Frederick P. Hitz, the CIA inspector general who oversaw the report’s production, retired immediately afterward in March 1998.  A graduate of the Harvard School of Law, Hitz was rewarded with a teaching post at Princeton University funded by Goldman Sacs.  His retirement, seven months before a declassified version of the report was made public, was celebrated with an entry in the Congressional Record.

One question remains.  Aside from the fact that from Afghanistan, to Pakistan, to Kazakhstan, to Colombia, oil and drugs always turn up in the same place, has there ever been any evidence connecting the oil industry to drugs directly?  And what does that have to do with 9/11?

Afghanistan and opium post 9/11

In this context it is not surprising that the US completed its invasion of Afghanistan in November of 2001 in the middle of the opium planting season.  Among the first things the US forces and CIA did was to liberate a number of known opium warlords who, they said, would assist US forces.  Opium farmers rejoiced and, amidst reports that they were encouraged to do so, began planting massive opium crops.  In December, former CIA asset and opium warlord Ayub Afridi was released from prison and recruited by the CIA to unify local leaders against the Taliban.

When the harvest of June 2002 came, Afghanistan had again become the world’s largest producer of the opium poppy and the world’s largest heroin supplier.  From a paltry 180 tons under the Taliban in 2001, according to the UN, the estimated 2002 harvest, under CIA protection, was close to 3,700 tons.  By March of 2003, World Bank President James Wolfensohn was reporting record levels of opium production and that drugs were a bigger earner for Afghanistan than foreign aid.

The 2003 crop set new records, coming in at almost 4,000 tons.  And experts warned that the June, 2004 harvest might be 50 percent larger than that of 2003.  In November of 2003, Reuters reported that Afghan opium cultivation was 36 times higher than under the last year of Taliban rule.

When I learned in early 2001 that the Taliban had destroyed Afghanistan’s opium crop, I wrote that it was a form of economic warfare that might take a whole lot of money out of the world’s banking system and its cooked books.  There is always a lag between planting, harvesting, and the cash flows that show up as the heroin moves from farm, to laboratory, through several layers of wholesaling to the streets.  The positive cash flow generated by Afghanistan’s first post-Taliban harvest would not have started to hit the banking system for maybe six to eight months after June of 2002.  In the late summer and fall of 2002 the Dow Jones had sunk to nearly 7,200.  As this book is written, and even as American jobs are disappearing, corporate profits and so-called “non-job” recovery have seen the Dow again at 10,000 based upon massive consumer spending which is financed by credit that must be serviced with fractional amounts of cash by the lending agencies.  The unprecedented 2004 harvest might be connected with the fact that it is an election year.

I don’t mean to offer drugs as a complete explanation for the so-called economic recovery.  But it helps to remember Occam’s Razor.


Thus ends the Unholy Trinity series.

Originally posted at The Refreshment Center
[Jump to Part One / Part Two]
Get the full story – get a copy of Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil now.
My thanks to Michael Ruppert at for allowing me to share this historically important work.  A membership to Collapsenet can save lives and supports independent press.

You can listen to Mike’s radio show, The Lifeboat Hour from Progressive Radio Network, every Sunday night at 9pm EST.  [Archives available on Podbean.]

*Sources and footnotes are in the back of the book – it is close to 700 pages long and there are over 6,000 footnotes.  Since the publication of this book in 2004, not one word, footnote or statement has been challenged, asked to be redacted, and Mike has never been sued.
Mr. Ruppert is the publisher and editor of From The Wilderness, a newsletter read by more than 16,000 subscribers in 40 countries. (Archives are still accessible for research.) A former Los Angeles Police Department narcotics investigator, he is widely known for his groundbreaking stories on US involvement in the drug trade, Peak Oil and 9/11.~~~~~~~~~
“They did that for 300 years.  When something works that well,
the ruling elites rarely let go of it.”


Unholy Trinity / Part Two

Excerpts from Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil
Published in 2004 / Chapter 3
The CIA Is Wall Street, And Drug Money Is King
by Michael C. Ruppert
[w/his permission]


In late June of 1999, NYSE Chairman Dick Grasso traveled to Colombia and met with the leader of the FARC rebels controlling the southern third of the country.  His trip was reported to the Associated Press, and, remarkably, the AP openly stated that Grasso had asked the Colombian rebels to invest their profits in Wall Street.  The FARC make their money by taxing the cocaine trade.  Catherine Austin Fitts described it as “the ultimate cold call.”
The amount of profit generated annually by the drug trade, if it is known with any accuracy, is probably one of the most closely guarded secrets in the world.  There are two kinds of money generated by the drug trade.  First there is the money generated at all the stages from growth or manufacture, to processing, to perhaps two or three stages of wholesaling, to retail street sales.  Then there is all the money generated by funding law enforcement, court systems, prisons, and all the construction, cars, radios, boats, guns, and airplanes that go into that.  It has been estimated that the cost of prison construction and operation alone is around $30 billion a year.
But all of that, as important as it is, is not what we are concerned with here.  What we are concerned with is the cash generated from the growth or manufacture and sale of drugs – because that money is illegal.  It needs to hide, and then it needs to be laundered before it can be used openly.  It is not only cheap and secret capital; it is capital that must be put someplace legal before it can be used.  The illegal-to-legal transition is where someone must know what is taking place.  Ignorance there – especially when the laundering transactions are gigantic ones – is not a tenable position.
Among the many kinds of illegal activities in the world, the production and laundering of drug money is central because it establishes channels for the flow of other criminal profits. [Examples: here and here]  In 2001, according to the International Monetary Fund, money laundering processed $1.5 trillion, a figure that exceeded the gross domestic products of all but the world’s five largest economies.  In 2000 Le Monde Diplomatique, a respected French publication, estimated total annual criminal revenues at $1 trillion: “The drug trade accounts for as much as $500 bbn and at least $1 bbn in criminal money is laundered every day.”  In 1997 the United Nations estimated that, as of 1996, the drug trade represented 8 percent of all world trading activity as measured in dollars.  It estimated then that the narcotics industry accounted for $440 billion in revenues.
Looking at the cash flow in just one locality, PBS’s ”Frontline“ tried to make the numbers a little easier to grasp.  “Imagine a typical weekend in New York City. Experts estimate that at least one percent of the population (80,000 plus) spends $200 on illicit drugs.  That alone would amount to $16 million dollars a week or $832 million a year.  And that’s just New York.”
Newer figures suggest that the drug trade generates $400-500 billion a year in cash.  However, I once had a conversation with an expert on money laundering who held a very high-ranking position in a US government agency charged with monitoring global cash flows.  On condition of anonymity, that expert told me, “It’s much higher than that.  Every conference I go to is attended by the CIA, and we all round the figure off to around $700 billion.”  Since the last real numbers I’ve been able to find date back a few years, and the drug trade is perpetually growing (along with the budgets to regulate it), I have settled on the figure of $600 billion a year for the purposes of my lectures and this book.  
Six hundred billion dollars a year is too much money to hide under a pillow.  [Note: Here’s a graphic for perspective.]  In fact, that much cash turning up in one place could overwhelm the banking system of a small or medium-sized country.  Of course the money is scattered all over the place, except in the cases of the major traffickers, and it has a way of moving by itself, electronically, always seeking the places where it will either earn the most profits or do the most good for its owners.  Cash, either hard currency or the electronic kind, is a prized commodity on financial markets because it does things that other kinds of wealth cannot do – such as pay bill or investors.  The money moves so quickly that, unless one were in control of the computer systems that handle it, or the software that manages it, it would be impossible to trace.  (An excellent discussion of how illegal money moves according to a separate set of laws – having nothing to do with what we tend to think of as the law – is contained in Hot Money and the Politics of Debt, by R. T. Naylor.
Second, of all the illegal drugs, from heroin to steroids to ecstasy to cocaine to marijuana, it is heroin and cocaine that are by far the most profitable and which make up the lion’s share of that $600 billion figure.  The markup for these drugs is substantially higher, especially when one considers the weight or volume involved per dollar of markup in price.
Almost all the world’s cocaine comes from Colombia, having been either grown or processed there.  The heavy production of cocaine in the 1980’s from Bolivia, Peru, and in smaller quantities from other Andean nations was largely eradicated by the early 1990’s as most production moved north.  However, it is important to understand that worldwide cocaine use has not seen a major drop since the 1980’s.  After having peaked at around 600 metric tons in 1987-1988, recent estimates and statements by the Department of Justice have placed US cocaine consumption around 500 metric tons (a metric ton is 2,200 lbs) a year.  That’s an interesting fact, since according to an interview I conducted with Dr. Sidney Cohen, a drug expert at UCLA, domestic cocaine consumption in 1979 was only around 80 metric tons.
Somewhere between 400 and 500 metric tons of heroin is consumed worldwide each year.  According to DEA and Department of Justice intelligence reports, about 60 percent of the heroin consumed in the US also comes from Colombia.  But almost all the heroin consumed elsewhere in the world comes from Afghanistan.  Like the coca leaf, the opium poppy from which the heroin is made grows mainly in the mountains and prefers altitudes above 5,000 feet.  But unlike coca, opium is grown in several different regions of the world: South America; the so-called Golden Triangle of Laos, Burma, and Thailand; and Afghanistan, Pakistan, and central Asia in an area called the Golden Crescent.  From 1997 to 2000 and again in 2002, the world’s largest producer of opium was Afghanistan, responsible for about 70 percent of the world’s supply.
What happened in 2001?  The Taliban banned opium production in the late summer of 2000 and destroyed almost all of the opium that still remained planted; this was completed and confirmed in January of 2001.  According to the Independent, “The area of land given over to growing opium poppies in 2001 fell by 91 percent compared with the year before, according to the UN Drug Control Programme’s (UNDCP) annual survey of Afghanistan.  Production of fresh opium, the raw material for heroin, went down by an unprecedented 94 percent, from 3,276 tonnes to 185 tonnes.”
Other sources placed the 2000 Afghan opium harvest (conducted from May to June, before the ban) at more than 3,600 metric tons.  The planting season for opium in that region is November, and the harvest is in the spring.  A kilogram (2.2 lbs) of Afghan heroin, refined at a 10:1 ratio from opium, was then fetching US$150,000 in Moscow.
It is interesting to note that in 1996, according to the DEA, “Worldwide opium production was 4,157 metric tons” (an increase of 20 percent in a single year).  Contrast that with one report obtained from the UN Drug Control Program by the magazine High Times stating, “Production of raw opium in Afghanistan shot up from 2,600 tons in 1998 to a record 4,600 tons” in 2000.
What is so significant about this is that if Afghanistan was producing 70 percent of the world’s opium, and it produced a minimum of 3,600 tons in 2000, then global consumption increased from 4,100 tons to 5,100 tons (25 percent) in just four years.  If, on the other hand, Afghanistan, as reported by the UN, produced 4,600 metric tons of opium in 2000 and retained a 70 percent market share, then world heroin use had risen 58 percent to 6,571 metric tons per year.  Even Ken Lay of Enron would be jealous of that kind of growth.
It is not likely that opium use increased 60 percent worldwide in four years.  Based on my years of experience, my estimate is that only 8-12 percent of the world’s population is predisposed to addiction.  The other conclusion available is that world opium production was being deliberately concentrated in Afghanistan.  But by whom and for what purpose?

Drug money – steroids of the financial world

Now, if you were a corporate executive needing to borrow money for an LBO or to finance a pipeline, you could go borrow the money legally at 9 percent, or you could borrow drug money, laundered once, looking to become legal, at 6 percent.  The drug lord is only too happy to own the bonds of, for example, Halliburton or General Electric.  But if you really wanted to make a killing, you would launder some drug money onto your bottom line and increase your net profits.  You might do it by selling your products “off the books” and accepting cash for them.  Then you would just inflate your net profits without any increased costs.  Philip Morris has been charged with doing just that.  Or, if you made vehicles, you could sell large quatities for a check from an offshore bank, no questions asked, to a guy in South America who wanted to open a Chevy dealership.  GM has reportedly done that.
Enron’s crimes all centered around the illegal overstatement of net profits.  They cooked their books using an accounting system called Pro-Forma that allowed them to borrow money with one subsidiary and then book the deposits as earnings.  They even created phony companies that could do business, using paper or electronic transactions, with other Enron companies.  This was the purpose of Enron’s so-called off-the-books partnerships known as Chewco, Raptor and LMJ.
Enron also manipulated energy prices through a variety of methods to create or worsen shortages, raise prices, and rob Californian’s blind.  Enron engaged in a shockingly wide array of financial crimes, betraying their stockholders and employees.*  But all the creativity of Enron executives Andy Fastow or Jeff Skillings or Ken Lay could never produce the pure financial power that drug money offers.
Apparently Enron knew that.  It ran about 2,000 subsidiary companies all over the world.  About 700 of them were in the Cayman Islands.  There is no oil or gas in the Caymen Islands.  There is, however, a lot of drug money.
Everything else Enron did had to pass through other companies, leaving records behind.  Drug money is much, much simpler.  Enron’s trading company, Enron Online, was one of the largest money-moving operations in the world.  It was just computers and wires in cities and to banks all over the globe.  It was a bank.  And it was there that the greatest criminal activity occurred.  When Enron went bankrupt, the US government allowed Enron to sell Enron Online to the Union Bank of Switzerland.  That meant that all the evidence of money laundering by Enron is now owned by a Swiss bank and out of reach for federal prosecutors.  Neither the Congress nor any US enforcement agency did a thing to stop the sale or transfer of the records.  The evidence walked.
For banks also, the drug money has a special allure.  That is why major banks like Citigroup, Bank of America, Morgan Stanley, Deutsche Bank, and JPMorgan Chase all offer private client services for the very wealthy with very few questions asked.  Yes, the US Treasury and the Department of Justice make a show of being tough under “Know Your Client” regulations.  But the truth is that the money does pretty much whatever it wants to.  And for a bank, every dollar that it has on deposit allows it to lend between 9 and 15 or so dollars based upon the requirements set for it by the Federal Reserve System.
For a bank, a loan is the same thing an order is for a manufacturer.  Loans show up on a bank’s books as assets, and that’s the part of what helps determine a bank’s stock value.  Of course, if a bank takes an extra fee, no questions asked, as Citigroup did from Raul Salinas de Gortari, brother of the former Mexican president, for laundering $100 million in drug profits, who’s to say how that money gets reported when it comes to net profits?
[*G ~ for more on Enron’s energy manipulation and price gouging scheme – I recommend the Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron, it is also a PBS, Independent Lens documentary.]
Birds do it, bees do it – even GE does it
In 2000 the Department of Justice held a drug money laundering conference and invited some of the biggest names on Wall Street.  The names were not chosen by accident.  Their products had been tracked and linked to money laundering operations in Colombia.  It had been noticed how much drug money was going into the bottom lines of certain major corporations.  The companies asked to attend the conference were Hewlett Packard, Ford, Sony, General Motors, Whirlpool, General Electric, and Philip Morris.
These companies, according to PBS and the Justice Department, were merely innocent victims of the trade.  It’s hard to understand how you are being victimized if your sales are great and people are paying with cash.  But the case of Philip Morris perhaps exemplifies general corporate attitudes about drug money.  Philip Morris had been sued by the government of Colombia for smuggling Marlboro cigarettes into that country (bypassing the tax man) and readily accepting large amounts of drug cash from traffickers, then smuggling the cash back into the United States.
Just recently the tobacco giant RJ Reynolds (Nabisco) had been sued by the entire European Union for large-scale smuggling and money laundering.  The competitive edge provided by handling drug money is an instrumental factor in who can compete in a globalized, new-world, corporate order.
A final note before moving on: As Enron (an energy trading company) was failing, the energy giant Dynegy put up $1.5 billion in cash as a part of a plan to bail Enron out.  Enron got the money and Dynegy wound up getting nothing.  What is significant is that Chevron, which had vast investments in central Asian oil fields, had been a part owner of Dynegy since 1996.  In 2001 Chevron added to its investment by giving Dynegy $1.5 billion just before Dynegy gave $1.5 billion to Enron.  So Chevron was either directly or indirectly bailing out Enron, without getting tarred by the unfolding scandal.
This takes on added significance given Enron’s drug money laundering connections and the fact that Enron, along with other energy companies like Halliburton, had deep financial connections in the region that were tied both to the successful development of central Asian oil and gas and had ready access to drug cash.
Enron had the contracts and the feasibility studies for much of the pipeline construction that was desperately needed in the region, and it also had a $3 billion investment in a new “white elephant” natural gas-powered electrical-generating station in Dabhol, India, that had only one problem: it couldn’t get access to cheap natural gas without a pipeline across Afghanistan.  One former oil industry corporate attorney summed it up best when he said, “When big oil eats, everybody eats.  When big oil doesn’t eat, nobody eats.”
NEXT : Part Three of Unholy Trinity / The Smoking Guns

Read the full story – get a copy of Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil now.

My thanks to Michael Ruppert for allowing me to share this historically important work.  
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*Sources and footnotes are in the back of the book – it is close to 700 pages long and there are over 6,000 footnotes.  Since the publication of this book in 2004, not one word, footnote or statement has been challenged, asked to be redacted, and Mike has never been sued.
Mr. Ruppert is the publisher and editor of From The Wilderness, a newsletter read by more than 16,000 subscribers in 40 countries. (Archives are still accessible for research.) A former Los Angeles Police Department narcotics investigator, he is widely known for his groundbreaking stories on US involvement in the drug trade, Peak Oil and 9/11.