What are the root causes of the global economic crisis?
by chilywilly
In the past decade, the world has seen the kind of power that unaccountable institutions wield. The effects of globalization since the mid 20th century have revealed highly centralized structures of power, from financial conglomerates to pharmaceutical monopolies and oligarchic neo-corporate states.
These dominant institutions not only have extensive control over resources and capital, but make social, economic, and political decisions outside the public’s sphere of influence. Their links to one another became ubiquitously apparent during the global economic crisis of 2008, and their alliances continue to pose the greatest threat to economic stability internationally moving forward.
Extensive analyses of global institutions have been done in the past by intellectuals and by courageous journalists. Much work has been done on explaining the roles that both businesses and states have to play in what's called a market society, and their respective (and general) interests have been closely examined. The work of populous intellectuals and muckraking techniques used by whistleblowers like WikiLeaks has inspired activists in communities all around the world to socially pressure powerful institutions for various humane purposes.
What are the root causes of the global economic crisis?
by Radioactive
These days, the most talked about news is the financial crisis that has engulfed the world economy. Everybody, the main headline of all newspapers is about falling share markets, decreasing industrial growth, high unemployment rates and the overall negative mood of the world economy (Eklavya, 2008).
The global economy crisis which is being experienced today cannot be seen as an event but rather, a process which has been building over time but has become more noticeable since September 2008 when a series of unprecedented events began to reorient the Global financial system.
These series of events has resulted in a global phenomenon called global economic/financial crisis. So what has caused this major economic upheaval in the world? What is the cause of falling share markets in the world and bankruptcy of major banks? In this essay, I intend to explain the root causes of the present day global economic crisis.
Recently, my local bank went bankrupt due to the global financial crisis. I had thought that the crisis would not reach Nigeria since we are relatively under-developed, I never knew that it was truly “global” and that even the rodents who spend some time in my room are suffering same predicament.
According to Professor Joseph Stiglitz, a Noble laureate and Professor at Columbia University, “the current financial crisis, which began in the US and then spread to Europe, has now become global” (Global Research, 2009). If you ask a thousand economists what they think is the root cause/causes of the global economic crisis, you will probably get a thousand answers! That aside, the current financial crisis is believed to have started in the United States of America where there is an imbalance in the circular flow of income.
What are the root causes of the global economic crisis?
by AIS
"It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." ― Henry Ford
Historically, many things have been used for money with the most enduring form being Gold or Silver. Paper money is largely a new idea, and the tool of scoundrels and the devious to debase the value of people's savings.
The US dollar as the World's Reserve Currency was established as such by the Bretton Woods Agreement in 1944: “The chief features of the Bretton Woods system were an obligation for each country to adopt a monetary policy that maintained the exchange rate by tying its currency to the U.S. dollar and the ability of the IMF to bridge temporary imbalances of payments”.
“On August 15, 1971, the United States unilaterally terminated convertibility of the dollar to Gold. As a result, "[t]he Bretton Woods system officially ended and the dollar became fully 'fiat currency,' backed by nothing but the promise of the federal government."
Fiat currency is simply this: The government says that something is money and must therefore be used as money. In the case of the US it is paper money and base metal coins.
The Fed essentially creates money “out of thin air”. You can find out how this is done here.
What are the root causes of the global economic crisis?
Authored by JP Orient
Abstract: This analysis argues that today's financial crisis is driven by computational heuristics, discoveries made by machines, to find logical rationales for maintaining moribund power structures. Rather than using computational heuristics to lead societies toward a world in which people desire to co-exist, the essay shows how vested interests have used machines to dictate and defend corroding centers of power. The result is an Imperium ex Nihilo, an "Empire Out of Nothing" but the assumptions of man inside the narrow focus of profit and greed.
Today's financial crisis can be analyzed through an array of lenses. In the narrowest, it is the capitulation of Keynesian economics to social conservatism emboldened by concentrated wealth. In the broadest, it represents lost trust in societies that delivered some of mankind's greatest social achievements: Enlightenment, Scientific Method, Democracy and Human Rights. Through an ecological lens we might see it as a resource-limitation shadow cast upon an ailing Earth. Militarily we may someday see the crisis as the product of imperial overreach. Commercially it could be scrutinized as a corporatist revolt, whereby organized interests overthrew the state in managing the world's tenuous plenty behind fortified castles of capital.
However history's kaleidoscope is used to see the crisis, it will be observed that the designers all used the same weapon in its proliferation: machines built to think for them.[1]
At least 40 injured and Rome left billowing in smoke after anti-austerity protesters clash with riot police in front of Parliament for over two hours tonight.
After weeks of dithering on the precipice of his own downfall, Silvio Berlusconi tonight survived a crucial vote of confidence, by one of the narrowest possible margins, allowing his government it to push through its proposed package of deeply unpopular austerity measures.
The cutbacks and tax hikes had been demanded by the European Central Bank in exchange for its buy-up of Italian bonds on secondary markets, after markets turned their sights on Italy last month, pushing the government’s borrowing costs close to the level where Greece had previously required an EU bailout.
But as Parliament prepared to vote on the austerity measures, violent clashes broke out between protesters and riot police. Downtown Rome was left billowing in smoke and littered with debris as at least 40 protesters were injured by random rounds of police baton charges.
Authored by Nikolas Kozloff
Chávez's "Charm Offensive"
Even during the darkest days of the Bush administration, Venezuela made efforts to mend relations with Washington. In 2005, for example, Chávez's Minister of Communications Andrés Izarra met with U.S. ambassador in Caracas William Brownfield. In an earlier meeting, Brownfield had suggested that Venezuelan journalists visit the U.S., an idea which Izarra had found lacking as "such visits might merely be indoctrination trips by the U.S. government." Nevertheless, during his follow up visit Izarra suggested that the two countries should explore the idea of conducting journalist exchanges, provided of course that the U.S. would follow up in kind and "invite U.S. journalists to Venezuela for reciprocal visits to poor Venezuelan communities where they might witness the government of Venezuela social missions."
Izarra's offer seems reasonable enough, yet the caustic and dismissive Brownfield was skeptical of Chávez's so-called "charm offensive." The ambassador remarked that Izarra had acted "very severely" toward several accredited U.S. journalists based in Venezuela. Izarra retorted that several American reporters, including the correspondent of the Miami Herald, had been "consistently and erroneously critical of the government of Venezuela and its policies," and therefore the Minister believed he "had a duty to criticize their errors."
Predictably, the meeting did not bear any fruit. It was unlikely, Brownfield remarked, that the U.S. Embassy would ever coordinate any journalist visits to Venezuela. Writing to his superiors in Washington after the meeting, Brownfield declared sarcastically "the charm offensive continues...Our judgment is still that the government of Venezuela offensive is tactical in nature."
Charitable View of Obama
Wikileaks just published the following statement:
"Recent statement by the New York based CPJ is misleading.
The Ethiopian journalist, Argaw Ashine, mentioned by the CPJ in its press release today, is not detailed by WikiLeaks cables as a US embassy informant. No journalistic source is named or identified in the cable. Rather, Mr. Ashine is mentioned, in passing, in relation to events in 2005 and 2006. Neither was Mr. Ashine named by the CPJ in a list of journalistic related redactions processed by us. While, it is outrageous for a journalist to feel the need to leave their country for a period, neither is it good for the CPJ to distort the facts for marketing purposes. Extraordinarily, the CPJ reserves more words for WikiLeaks, who has no influence on the situation, than it does for the Ethiopian government, or its military and intelligence backer, Washington.
The Guardian newspaper disclosed the Cablegate decryption password, and nearly a year of careful redactions, in a violation of our Memorandum of Understanding. The Guardian editor responsible has stated (to the Economist), that he "regrets" the error. Such issues are part and parcel of working with the mainstream press, which must be able to decrypt our material in order to read it. Understandably, we are reconsidering how we deal with such institutions, if at all.
In the last two weeks WikiLeaks has released details on the slayings of several journalists by U.S. forces. The CPJ has covered none of the new detail on these killings, or the dozens of other attacks on the press we have recently exposed in the last month. Nor has it spoken about the hundred raids or arrests on our supporters, or the unprecedented extrajudicial economic warfare levied against us. We hope that this is an oversight and not a reflection of CPJ's U.S. centric funding arrangements.
The broader issues are detailed in New Scientist:
In his first interview since being released from jail, Rudolf Elmer stated to India Today that:
- the investigation against him is still ongoing, and that he could not make any detailed statements because he would be arrested again.
- the CDs he handed over to Julian Assange in the Frontline Club were empty. He also said that it was only a symbolic handover, because it was a public place, and because the police could have intervened. He also said that Assange would not have come, had there not been information.
- that he would not have been released from prison had any data been published.
- that he cannot answer whether any Indian names are on a list he allegedly gave to Assange, as the investigation against him was still ongoing.
- it is possible to keep money out of reach of tax authorities. He also describes how this could be done, in hypothesis.
- that he cannot comment on whether any Indian cricket players have Swiss bank accounts because his investigation is still ongoing.
- that private investigators put pressure on him and his family, including his six year old daughter.
- that he filed a complaint at the European Court of Human Rights.
- that he will appear in court in November.
- that Assange protected him and his family. This statement was made in reply to a question whether there was a deal between Assange and the courts that Assange will not publish the data.
WL Central cannot verify these claims. The above is merely a summary of some key points in this interview. For our previous coverage of the topic please see this link.
A secret diplomatic cable [08SOFIA185], released by Wikileaks and dated March 27, 2008, reveals that Bulgarian Ambassador in Washington, DC, now serving a second term there, Elena Poptodorova and then Deputy Defense Minister, Sonya Yankulova, have informed American Ambassador in Sofia John Beyrle about plans to increase the Bulgarian contingent in Kandahar by fifty rangers, months before the official decision of the Bulgarian cabinet.
The cable is also shading light on the steady pressure exerted by US officials on the Government of Bulgaria to expand its Afghan contribution with new contingent.
In two separate meetings, Poptorova and Yankulova have stressed to Beyrle that this had been sensitive information while the diplomat wrote in the cable, classified as secret, that both ladies must be under a strictly protect status.
"Bulgaria is set to announce a decision to deploy an additional 50 soldiers to take over the Entry Control Point Number Four mission at Kandahar Airfield. It is keeping this decision under tight wraps for now. We expect the formal decision will be made just before the NATO Summit, and the announcement itself probably in Bucharest by the Prime Minister. Both Ambassador Poptodorova in Washington and Deputy Defense Minister Yankulova (strictly protect) have foreshadowed this outcome and the sensitivity of the decision and announcement timing," Beyrle informs in his report.
"While a formal decision is still days off, and there is still some scope for a mis-step, we would be surprised if Bulgaria does not come through," the Ambassador concludes.
A 2001 cable discusses the potential release of archive material on a highly sensitive topic, the dealings of Eugenio Pacelli, later pope Pius XII, during Second World War. This cable (01VATICAN4258) was first published in a redacted form by the Guardian. Its full text was later on released by Wikileaks. Both versions can be accessed here.
The cable describes a meeting between embassy staff and Peter Gumpel, SJ the keeper of the archive, to discuss a way forward, so that the existing material could be released without delay, while maintaining a "positive, productive dialogue".
According to the cable, Gumpel responded:
"GUMPEL IMMEDIATELY ADVISED THAT THE ISSUE OF ACCESS TO THE VATICAN ARCHIVES RELATED TO THE WORLD WAR II ERA WAS SIMPLY AN INTERNAL MATTER OF PROCEDURE AND NOT A POLITICAL ONE."
The following passage was redacted by the Guardian. According to the full Cablegate archive, it went on to say:
"ALTHOUGH LATER HE ADMITTED THAT IT HAD BEEN TURNED INTO A POLITICAL ISSUE THROUGH A DISTORTION OF FACTS RELATED TO THE WORKINGS OF A JEWISH-VATICAN COMMISSION STUDYING PIUS XII'S ROLE DURING THE SECOND WORLD WAR. GUMPEL PROFFERED COPIES OF HIS STATEMENT, WRITTEN WITH AUTHORIZATION FROM THE HIGHEST LEVELS WITHIN THE VATICAN HIERARCHY, COUNTERING "FALSE" ASSERTIONS BY UNNAMED MEMBERS OF THE COMMISSION, AS WELL AS A STATEMENT PREPARED BY CARDINAL WILLIAM KEELER OF BALTIMORE, THE U.S. BISHOPS DELEGATE FOR CATHOLIC-JEWISH AFFAIRS, WHO DID NAME NAMES."
In the following, a passage describing this "political issue" has also been removed:
The records continuum model was developed by Monash University’s Frank Upward in the mid 1990s as a way of expressing the many recordkeeping processes that occur in society and the contingencies inherent in them. It explains the way in which records are made, organised, shared and used in a variety of times, places and contexts under the influence of changing legal, political and practical constraints. It has been written on extensively, and there are some references included below, so I do not propose to expand on it in detail here.
My reason for introducing it is that as the events of CableGate 2 unfolded over the last couple of weeks I was struck with the way in which the expanded possibilities for use, sharing and reclaiming records we have seen with the cables release have demonstrated what, in continuum terms, is labelled ‘Fourth dimension’ recordkeeping; that is, the formation of a pluralised archive which exists beyond spatial and temporal boundaries, transcends state and economic controls and which actually encourages and incorporates people’s participation and comment. An archive which reflects a truer, less filtered and more inclusive perspective on the events documented in the records.
The qualities that set CableGate 2 apart from traditional archives and even from prior releases by WikiLeaks, making it a truly ‘Fourth dimensional’ archive, are essentially about participation and plurality.
Participation
"Revenues from 'one million barrels of oil per day' go entirely to 'five or six princes'."
-- Cable from the U.S. Embassy in Riyadh, Saudi Arabia
A secret 1996 cable -- sent from the U.S. Embassy in Riyadh, Saudi Arabia and released by Wikileaks -- offers a detailed account of the mechanisms of wealth distribution and waste within Saudi Arabia's royal family. Despite the considerable riches doled out to "thousands" of Saudi princes and princesses, the cable observes that Saudi royals "seem more adept at squandering than accumulating wealth." (The embassy notes that the country has more commoner billionaires than royal billionaires.) As reported in the cable, corruption also abounds largely unchecked.
Oil revenue is said primarily to enrich the Al Saud. The embassy explains that Saudi Arabia's Ministry of Finance distributes a portion of the country's oil proceeds to each Saudi royal family member in the form of monthly stipends. At the time the secret cable was issued, every royal reportedly received a monthly allowance from birth, on a sliding pay scale of US$ 800 (for distant royals) to US$ 270,000 (for sons and daughters of King Abd Al-Aziz). The embassy calculated these stipends to total more than US$ 2 billion of the Saudi government's US$ 40 billion annual budget. For this and other reasons, the embassy concludes that "getting a grip on royal family excesses is at the top" of priorities for Saudi Arabia.
In addition to the state-budgeted stipend, the cable reports, a royal may obtain a bonus of as much as US$ 3 million, as reward for getting married or building a palace. The existing stipend-and-bonus system provides Saudi royals with a significant incentive to procreate, particularly since stipend distributions begin at birth. It was stated that the central life aspiration of one Saudi prince was to have more children, so as to increase his monthly allowance.
Authored by Nikolas Kozloff
"Ambivalent" Relationship on Drug War
As the political relationship deteriorated between the Bush administration and Chávez, so, too, did collaboration on the U.S.-sponsored drug war. Recently released cables document the testy and "ambivalent" dynamic, with U.S. ambassador William Brownfield commenting that Chávez's anti-drug czar Luis Correa appeared to be "penalizing" a non-governmental organization called Alianza "for having too close of a relationship with us."
Brownfield was rather suspicious of Correa, noting to his superiors that the Venezuelan was a professional intelligence officer. Before taking up his post heading up anti-drug efforts, Correa directed a technical unit that targeted the U.S. Mission. Correa was responsible for monitoring U.S. Embassy communications with teltap and cellular intercept equipment. "Notches on Correa's belt" included turning a U.S. government informant and "penetrating an unclassified email system." Correa, Brownfield explained, directed a computer hacker who was able to obtain Embassy staff's e-mails and conducted surveillance of DEA agents, infiltrating the organization in the process and sabotaging equipment.
Not surprisingly, bilateral anti-drug cooperation almost hit rock bottom, and the only active joint project consisted of a port security project. After months of delay, the Venezuelans authorized U.S. officials to conduct an anti-drug training session. However, several no-shows failed to attend as they had become "apprehensive" about political persecution. Correa also snubbed the U.S. by refusing to attend the event, claiming that a Chávez coup plotter served on the board of directors of Alianza which sponsored the event.
This is a "WikiLeaks News Update", a daily news update of stories that are obviously related to WikiLeaks and also freedom of information, transparency, cybersecurity, and freedom of expression. All the times are GMT.
10:20 PM A very comprehensive recent interview with Julian Assange by newspaper Russian Reporter where Julian discusses the strict bail conditions he is under, the financial blockade and other attacks against WikiLeaks, the possible return of the website’s anonymous electronic drop box and the present and future of the organization overall…
- Update: Another interview, published today in the printed version of German newspaper Sueddeutsche Zeitung, titled Julian Assange and how he sees the world covers similar topics. In it Julian mentions OpenLeaks founder and former WikiLeaks spokesperson Daniel Domscheit-Berg's possible cooperation with the Grand Jury investigation against WikiLeaks:
Assange: [Domscheit-Berg] took cash, hardware, material by our sources, e-mails, software and archive material written by me with him. This all happened in context with a workgroup of the CIA working against us and with the investigations by a Grand Jury in Washington.
SZ: Are you trying to say that Daniel Domscheit-Berg was part of that operation?
Assange: I think that Domscheit-Berg is an informant for the police.
SZ: Do you know that or think that?
Assange: His name appears nowhere in the documents of the Grand Jury while my own and the names of other individuals from our organization are listed there.
The US used "terrorist-listing" as a way to influence the peace talks between the National Democratic Front of the Philippines (NDFP) and the Government of the Philippines (GPH)
Confidential and secret cables released by Wikileaks from the US embassies in Manila and The Hague in the Netherlands show how three governments worked together to designate as “terrorist” Jose Maria Sison, chief political consultant of the National Democratic Front of the Philippines in peace talks with the Manila government. The move may have been part of Philippine government’s pressure tactics on the NDFP during peace negotiations. However, the move did not yield the Philippine government’s desired results.
Sison, the Communist Party of the Philippines and New People’s Army were included in the US terror list in August 2002, right after the Manila visit of then Secretary of State Colin Powell. Sison was soon after also included on the EU “terrorist list” of organizations and individuals with sanctions upon the requests of the US and PH governments. His bank account was subsequently frozen, denying him social benefits accorded to refugees living in the Netherlands.
Terrorist-listing as leverage
The US, Dutch and Philippine governments engaged in acts that were inimical to the peace talks between the NDFP and the Philippine government. The Philippine government used the terrorist listing as leverage against the NDFP. There was intense pressure was brought to bear on Sison: from the deprivation of social benefits, threats to his life, and even arrest and detention. The matter of the terrorist listing became a prejudicial question in the peace talks.
In a 2005 meeting (05MANILA655) with US Ambassador Francis Ricciardone, Foreign Affairs Secretary Alberto Romulo said that the NPA’s “delisting as a foreign terrorist organization depended on a demonstration or proof of sincerity… such as entering into a cease-fire or new peace talks.”
Various media outlets since yesterday have reported on a secret US embassy cable showing a Norwegian third-party facilitator in the peace process between the National Democratic Front of the Philippines and the Philippine government discussing details of the peace talks with a representative of the US embassy in Manila. The cable puts to question Norway’s avowed impartiality in the peace processes it is involved in.
In the cable marked “Secret” because of the sensitivity of the conversation, Norwegian Special Envoy Vegar Brynildsen met with US embassy political officers on February 3, 2010 to discuss Norwegian efforts to facilitate peace talks between the Philippine government and the National Democratic Front of the Philippines. (10MANILA235)
The cable carried a “Strictly protect” clause since Brynildsen was seriously concerned that discussion of his meeting “could call into question the discretion of the Norwegian facilitators”.
Media outlets who reported on this particular cable focused on Byrnildsen’s observations on the peace process, the NDFP, its chief political consultant Jose Ma. Sison and the Left’s participation in 2010 Philippine presidential elections. Byrnildsen commented that Sison appeared “not in control” of the movement in the Philippines, citing alleged differences between the Europe-based negotiators and the Philippine-based leadership.
The NDFP represents the revolutionary movement that has been waging a four-decade long “people’s war” against the Philippine government and US imperialism. Sison, the NDFP’s chief political consultant, was previously listed as a “terrorist” by the US and EU. In 2009, the European Court of First Instance removed Sison’s name from the EU list.
Byrnildsen said it was a “real challenge” to work as facilitator while not knowing the inner workings of the NDFP. He also said that he was not “positively impressed with the quality of Philippine government intelligence on the NDFP”.
This is a "WikiLeaks News Update", a daily news update of stories that are obviously related to WikiLeaks and also freedom of information, transparency, cybersecurity, and freedom of expression. All the times are GMT.
10:50 PM WikiLeaks releases continue to receive significant coverage in Taiwan.
Newspaper United Daily News reports: "The leaked AIT (American Institute in Taiwan) cables are like a magnifying glass in which politicians' abilities to enchant their voters has been removed and hence, the leaked information has set a time-bomb for next year's presidential and legislative elections".
09:00 PM According to a U.S. Embassy cable from October 2006, three bomb explosions may have been orchestrated by the Government of Ethiopia in an attempt to justify its crackdown on Oromo political activists:
"The National Intelligence and Security Service (NISS) said that the intended terror plot had failed and the bombs had mistakenly gone off while the suspects were preparing them while hiding out at an illegally built house. Two of the suspects died immediately, while another died on the way to the hospital. One other is in critical condition. The police task force reported having others in custody related to the plot and that evidence shows the terrorists had ties to Oromo groups (…)", the cable reads.
Authored by Nikolas Kozloff
"Loco Chávez Time"
Underscoring the highly sensitive political environment in Venezuela, U.S. diplomats alerted Washington in 2008 to an odd incident which had occurred at the Caracas airport. One evening, the manager for American Airlines in Venezuela called the U.S. Embassy to report that the captain and crew of flight 903 were being held at the airport. What was the reason? Apparently, upon landing a crew member had remarked "'Welcome to Venezuela. Local Chávez time is' X."
One year earlier, Venezuela had created its own time zone, and most likely the crew member was simply reminding the passengers of this fact so as to turn their clocks back 30 minutes. However, one passenger thought the crewmember had actually said "loco Chávez time" while Venezuelan immigration officials claimed the actual quote was "the hour of the crazy Chávez and his women." American Airlines diffused the situation by flying the captain and crew out of Venezuela shortly thereafter and offering profuse apologies to Chávez authorities.
"Fascist" Elements Within Chávez's Coalition?
In another unrelated cable, the U.S. Embassy made explosive and incendiary charges regarding Chávez's inner circle. During a lunch, a "well respected political economist" told embassy staff that Minister of Public Works and Housing Diosdado Cabello "was expanding his network of corruption into the financial sector." Cabello, the source claimed, had joined with several other veterans of Chávez's 1992 attempted coup and this "fascist and military" trend "was gaining ascendancy within Chavismo" to the detriment of older leftists.
This is a "WikiLeaks News Update", a daily news update of stories that are obviously related to WikiLeaks and also freedom of information, transparency, cybersecurity, and freedom of expression. All the times are GMT.
10:00 PM Companies working with the Khartoum government enabled the perpetration of atrocities against civilians in Darfur.
09:20 PM A round-up of WikiLeaks news by newspaper The Zimbabwean:
The late army commander General Solomon Mujuru allegedly sent an emissary to the MDC without President Robert Mugabe’s knowledge in 2000 to warn the party about a planned violent crackdown.
Goodson Nguni, a well known Zanu (PF) activist, was named as the emissary. It is alleged that he negotiated a pact with the MDC whereby they agreed to an amnesty for current and past government officials, in return for an open dialogue about the possibility of forming a coalition government.
It has also been revealed that African diplomats have called for President Robert Mugabe’s ‘graceful’ exit from power. Leaders who, in the past, have stood by the octogenarian leader, have, according to Wikileaks, grown impatient with the Zimbabwean situation. (…)
08:50 PM Canadian multiculturalism policies were believed by Canadian officials to have affected the efficacy of anti-terrorism and anti-radicalization efforts.
Authored by Nikolas Kozloff
Drug Trafficking Airline?
More incendiary revelations from WikiLeaks: now comes a cable from 2008 reporting on U.S. wariness of Aeropostal, an airline whose owners, the Makled family, were "Venezuela's preeminent drug traffickers." When Aeropostal sought to extend its flights to the U.S., the American Embassy in Caracas recommended that the request be denied. Furthermore, diplomats believed that the Chávez government's decision to allow the Makleds to purchase Aeropostal "sheds further doubt on Venezuelan aviation security."
The Defense Intelligence Agency (DIA) was so worried about Walid Makled that it issued a report entitled "Venezuela: Business Entrepreneur Dominates Cocaine Trade." The report asserted that Makled leveraged "his involvement in the transportation industry to facilitate drug shipments and provide cover for his own illicit activities."
Speaking to the Americans, an Aeropostal representative rejected the allegations but admitted that the new owners of the airline "know nothing about aviation." U.S. diplomats however were unconvinced, remarking that "this claim of ignorance about aviation seems odd, when according to the DIA report, the Makleds own a small airport they use to ferry drugs to Mexico twice a week."
Dodd to Chávez: Give Peace Corps a Chance
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