In December 2021 Boris Johnson announced a new ‘war on drugs’ in Britain, with a ten-year plan to reduce drug use by targeting supply chains and recreational users. The government is considering new draconian punishments for those caught using drugs including taking users’ driving licences and passports. The finalised measures will be released in a White Paper later this year. Just days before the new crackdown was announced, cocaine was found in 11 out of 12 places tested in Westminster – including in the bathrooms adjacent to offices of Johnson and Home Secretary Priti Patel. The Prime Minister and members of his cabinet are on record admitting drug use. ‘Wars on drugs’ have always been deceitful campaigns that disproportionately target black, Asian and poor people both within Britain and around the world. Proposed measures outlined in the ten-year plan will give the state more power to punish oppressed groups while the City of London will remain unscathed as a world centre for laundering vast amounts of dirty drug money. RIA AIBHILIN reports.
Cocaine was once considered a drug for the middle and upper class in Britain, consumed in ritzy clubs and boardrooms in the City of London while the working class were offered its cheaper crack derivative. In the 1980s cocaine’s purity was around 20%, at an average cost then of £120 a gram in real terms. Today, as the market has been extended, purity averages at 65% but is widely available at 80% and its street price is typically between £50 and £90 a gram, depending on purity. Consumption across Britain and the north of Ireland is estimated to be 117 tonnes every year – an increase of 290% over the past ten years (The Guardian, 19 September 2021) and its users are not limited to a particular socio-economic background.
Social crises – rising poverty and homelessness, falling standards of living – within the imperialist countries underpins the growing demand for drugs. Cocaine is the second most used drug, behind cannabis, in Western Europe. This is in line with an increase in global cocaine production, predominantly in Colombia, and a global network of drug trafficking organisations orchestrating the large-scale supply of cocaine to Europe.
Cocaine imperialism
The European Union Agency for Law Enforcement Cooperation’s 2019 report on EU drug markets found Colombia to be the largest supplier of cocaine available on drug markets in Europe (68%), followed by Peru (19%). Imperialist exploitation has made Colombia reliant on cocaine to prop up its economy.
Colombia’s largest legal exports are petroleum, coal and coffee. The prices for these commodities are determined by the London and New York futures markets, leaving Colombia vulnerable to the pressure of British and US banks and hedge funds. Before the coronavirus pandemic employment in Colombia averaged 57.4% of the adult population; this fell to 51.7% in the first year of the pandemic. 21 million Colombians live in poverty, of whom 7.4% live in extreme poverty. One sector that has grown and can ensure jobs is the cocaine industry.
Since the 2016 ‘Peace Deal’ in Colombia, cocaine production has rapidly expanded as the FARC forces have disarmed and departed from previously occupied areas, leaving towns and rural areas vulnerable to violent takeover by drug traffickers. White House figures estimated Colombia’s cocaine production potential at 420 metric tonnes in 2015; UN figures estimate 1,228 metric tonnes of cocaine was produced in Colombia in 2020.
Now unconstrained, armed drug gangs coerce or attract those with no other option but to work in the production or movement of cocaine. These young people are commonly drawn into the gang wars that comes with the struggle for control of the chains of production and transportation. The Pacific coast of Colombia has one of the highest rates of violent injuries in Latin America. In addition, the excess of polluting gasoline and hydrochloric acid needed to turn coca leaves into paste in the production process is dumped in rivers.
When the US announced Plan Colombia as part of its ‘War on Drugs’ in Latin America in 2000, it was and has remained a cover for destroying revolutionary opposition to imperialism. By 2009 Colombia was the third largest recipient of US aid behind Israel and Egypt. Britain has trained the Colombian police force in a multi-million-pound programme. Imperialist countries have never had any real intention to combat the drug market because they depend on it. Over thirty years ago, we examined the economic conditions that made cocaine the most profitable industry in Latin America in the 1990s: ‘Were the “War on Drugs” to be just that it would collapse at least three [South] American economies, trigger debt repayment defaults and bring imperialist client governments crashing to their knees’ (Trevor Rayne, FRFI 92).
Between 1997 and 2004 the US monopoly Chiquita, formerly United Fruits Company, funded the far-right paramilitary force of allied landowners, soldiers, politicians and drug traffickers – the AUC. The AUC slaughtered communists, activists, journalists, workers, peasants, environmentalists and trade unionists. They also monopolised Colombia’s cocaine trade after the decline of the Medellin Cartel with the killing of Pablo Escobar in 1992. As in all markets under capitalism, the drug market has a tendency towards monopoly. If you are the best connected and most ruthless organised crime group you can monopolise the industry, control prices, undercut competitors and secure customers to ensure the most profitable rates of return.
The AUC officially disbanded in 2006 when it became less necessary to the Colombian ruling class, its members given or keeping their jobs in the police force and army (see Alvaro Michaels, FRFI 186). Today the two dominant cartels, offshoots of the AUC, are the Golf Clan and Oficina de Envigado. They ensure Colombia can pay its foreign debt to imperialism and continue to massacre any internal opponents of imperialism.
Unregulated capital
Most cocaine coming into Europe now travels from Colombia, through Brazil or Ecuador, sometimes stopping off at Guinea-Bissau, and into the ports of Rotterdam and Antwerp before being distributed onwards. Only 2% of cargo arriving in Rotterdam is checked. The Calabrian-based Italian Mafia group ’Ndrangheta dominated the wholesale supply of cocaine from Latin America to Europe from the early 2000s. Its global expansion gave it direct links to Colombian and Brazilian cartels, allowing it a competitive advantage.
With the fragmentation of the AUC in Colombia, smaller drug trafficking groups in Europe have been able to make their own connections, particularly groups from the Balkan region, threatening the ’Ndrangheta’s monopoly. Still, it remains a dominant force in the transatlantic cocaine trade and during its peak in 2013 the ’Ndrangheta had an estimated turnover of £44bn a year – over half of it from drug trafficking; more than the combined turnover of McDonald’s and Deutsche Bank. Dame Carol Black’s 2020 government-commissioned independent review of drugs found that the illicit drug market in Britain and the north of Ireland is worth an estimated £9.4bn a year. This is an insight into the huge profits being made from drugs.
London washes drug money whiter than white
In 2015 Roberto Saviano, author of the best-selling expose on the Campania-based Camorra mafia Gomorrah, declared the City of London as the world’s centre for laundering drug money. The ’Ndrangheta has used the capital as its money laundering base. After the release of the Pandora Papers in October 2021, Conservative MP Andrew Mitchell admitted that London is ‘the money laundering capital of the world.’ British bankers, property developers, real estate agents and politicians are key facilitators.
British bank HSBC, headquartered in Canary Wharf, was found guilty in 2012 of laundering at least $881m controlled by El Chapo’s notorious Sinaloa Mexican drug cartel. Cartel members would bring hundreds of thousands of dollars in cash into a single bank and deposit it into one account with no questions asked. HSBC was fined $1.9bn by US authorities, but no US or British authority pursued a criminal investigation. HSBC’s chief executive at the time, Stephen Green, was appointed as a government advisor, life-peer and member of the House of Lords.
HSBC was fined another £63.9m by the Financial Conduct Authority in December 2021 for further money laundering failures. That same month another British bank NatWest was fined £265m for laundering millions of pounds for suspected drug gangs. NatWest is majority owned by the state after being bailed out by tax-payers in the 2008 financial crash.
Billions of pounds of cash from drug trafficking are legitimised by British banks, the money then hidden in shell companies. Creating a company in Britain could not be easier. Register your name with Companies House via the government website, pay £12 and you should get approval within 24 hours. Don’t worry about providing proof of identity: at least five individuals supposedly control more than 6,000 companies and thousands of names registered at Companies House have been stolen from children under the age of two.
British accountants will help you set up various other shell companies in British-dependent offshore havens or British Overseas Territories, such as the British Virgin Islands, famed for their secrecy laws. They will move your money between accounts in different jurisdictions so it becomes more and more difficult to trace. Nicholas Shaxson, author of Treasure Island, explained in a piece for the New York Times on 11 October 2021 how Britain is ‘the main nerve centre of the darker global offshore system that hides and guards the world’s stolen wealth’.
The British economy is reliant on its dependencies and the City of London being an offshore centre for a large proportion of the world’s capital, whether it’s coming from drugs or other means. ‘In 2007 Britain’s three Crown Dependencies [Jersey, Guernsey and Isle of Man] held around $1 trillion assets. They channel very large amounts of finance into the City of London. In the second quarter of 2009, the UK received $332bn net financing from [the dependencies].’ (David Yaffe, FRFI 221).
Once your money and identity are anonymised in Britain’s web of offshore satellites, you can use one of your shell companies to buy a legitimate company or a multi-million-pound house in Knightsbridge where the money is safely stored in an asset only set to rise in value. The anti-corruption organisation Transparency International estimates at least £5bn of property in Britain has been acquired with ‘suspicious wealth’ over the past decade. But ignorance is bliss: in 2019 half of all estate agents advertising properties above £5m had failed to register with HMRC for anti-laundering training.
Johnson’s ‘From harm to hope: a ten-year drugs plan to cut crime and save lives’ declares ‘we want to make the UK the hardest place to launder cash and remove the profitability of the drug market’. This will not happen because the British state will not challenge its ruling class who oversee the banks, property market and occupy government positions, and who cannot forsake the enormous profits to be made from the illegal drugs trade. It cannot happen because it would mean overhauling the offshore system that the City of London is central to and that Britain needs to maintain itself as a major capitalist power.
This article builds on the work produced by TREVOR RAYNE in his two-part series ‘Cocaine Capitalism’ published in FRFI 92 (January 1990) and FRFI 95 (June/July 1990).
Fight Racism! Fight Imperialism! No 286, February/March 2022
