dd-c05-s07

Deterring Democracy Copyright © 1991, 1992 by Noam Chomsky. Published by South End Press.
Chapter 5: The Post-Cold War Era Segment 7/15

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As for the drug connection, whatever Noriega's role may have been, he was surely not alone. Shortly after Noriega stole the 1984 elections by fraud and violence to U.S. applause, the Federal district attorney in Miami identified Panamanian banks as a major conduit for drug money. A year earlier, a Senate report on banking had described Panama as a center of criminal capital, and a key link in drug transshipment and drug money laundering. These practices largely ended when the U.S. sanctions in 1987 virtually closed the banks, the press reported after the invasion.³⁶

The bankers were returned to power in Panama with the invasion, as the media finally deigned to notice. The Attorney General and the Treasury Minister installed by the U.S. invasion (also, reportedly, the new president of the Supreme Court) are former directors of the First Interamericas Bank, owned by one of the leading Colombian drug bosses and used by the Colombian cocaine cartel to launder profits; it was shut down by Noriega in 1985 in a move considered by the DEA to be an important blow to the cartel. President Endara, a corporate lawyer, had for years been a director of one of the Panamanian banks discovered by the FBI to be involved in money laundering. The Miami Herald reports that Guillermo Ford, Vice President under Endara and president of the banking commission, along with his brother Henry, had close business ties to Ramón Milián Rodr¡guez, the cartel money launderer who is serving a 35-year prison sentence. They were co-directors of companies that were used to launder money, Milián Rodr¡guez testified. Another link to the Endara government was exposed in April 1989, when Carlos Eleta, a leading businessman and Noriega opponent, was arrested on charges of importing cocaine and money laundering. According to a high-ranking U.S. source, Eleta had been recruited by the CIA to help distribute $10 million in covert U.S. aid for Endara's election to the presidency a month later.³⁷

Queried on a report that banking practices would be modified to deter drug money laundering, President Endara said that any changes would be "not that profound" and that "the bankers want changes that are reasonable and will not duly change the banking environment." A month later, U.S. negotiators had "given up efforts to change Panama's bank-secrecy laws, which have made that nation the most notorious center for drug-money laundering in the hemisphere," Frank Greve reports, adding that at least 10 major Panamanian banks are "willingly involved" in drug money laundering according to U.S. authorities,

and experts believe billions of dollars in drug money have flowed through Panamanian banks in general in the last decade.... Asked why the United States yielded on bank secrecy, a State Department official replied, "We don't want to alienate the Panamanians just as we're sitting down to negotiate with them.... Rather than tell them whether their laws are sufficient, we'll let them decide."

They decided in the predictable way, with a few cosmetic changes: "I can't say now there's less money laundering," the Banking Association of Panama President Edgardo Lasso says, "But it may be happening without our knowledge."³⁸ The artificial Panamanian economy relies heavily on this "banking environment," and Washington is unlikely to interfere very seriously.

It all makes good sense. Milián Rodr¡guez himself had been invited to the Reagan inaugural, Leslie Cockburn reports, "in recognition of the $180,000 in campaign contributions from his clients" (the cocaine cartel, who regarded Reagan as "our kind of candidate," he said).³⁹ As Drug Czar in the early 1980s, George Bush cancelled the small Federal program aimed at banks engaged in laundering drug money, and this critical link in the trade was put to the side in the new phase of the "drug war." Ghetto kids who sell crack arouse our ire, but not the civilized folk in the plush offices.

After the U.S. government had determined to rid itself of Noriega, it continued to support the Panama Defense Force that he headed, though it was well known that the PDF was involved in the rackets at every level. When George Shultz produced an accolade to the PDF in March 1988, describing it as "a strong and honorable force that has a significant and proper role to play," the New York Times commented that "it is odd to hear Administration officials sing the military's praises when it is layered with General Noriega's cronies who have shared in the profits from drug-trafficking and other criminal activities." With the successful completion of Operation Just Cause, the PDF was reconstituted under essentially the same leadership, who, it is expected, will be more loyal to their U.S. commanders than the unpredictable Noriega. Noriega's successor was Colonel Eduardo Herrera Hassan, whose troops "most energetically shot, gassed, beat and tortured civilian protesters during the wave of demonstrations against General Noriega that erupted here in the summer of 1987," the New York Times observed while reporting that the Colonel, "a favorite of the American and diplomatic establishment here," is to be placed in command of the military with their new "human rights" orientation. In its May 1990 report on the Panama invasion, Americas Watch expressed considerable shock over the appointment of Col. Hassan, who "directed the most brutal repression of peaceful demonstrations in Panamanian history, on July 10, 1987, which Noriega's opponents called `Black Friday'." "By any reasonable standard, he himself should be on trial" -- as should George Bush, one might add.⁴⁰

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36 CAR, vol. XI, no. 31, 1984, citing Miami Herald. Staff Study, "Crime and Secrecy: The Use of Offshore Banks and Companies," Permanent Subcommittee on Investigations of the Committee on Governmental Affairs, U.S. Senate, 1983. Michael Kranish, BG, Jan. 1, 1990.

37 Philip Bennett, BG, Feb. 5; Stephen Labaton, NYT, Feb. 6, 1990.

38 AP, Jan. 20; Greve, Phila. Inquirer, Feb. 22; Lasso, CSM, Aug. 15, 1990, an upbeat report on Panamian recovery -- for the rich.

39 Cockburn, Out of Control, 154.

40 NYT, March 22, 27, 1988, cited by Weeks and Zimbalist, op. cit.; Larry Rohter, NYT, Jan. 2, 1990; Americas Watch, The Laws of War and the Conduct of the Panama Invasion, May 1990. Constable, BG, July 10, 1990; Massing, op. cit. In August, Herrera was replaced as head of the national police force by Colonel Fernando Quezada; AP, BG, Aug. 23, 1990. KEYWORDS terrorist democracy elections cia mossad bnd nsa covert operation 911 mi6 inside job what really happened wtc pentagon joint chiefs of staff jcs centcom laser hologram usa mi5 undercover agent female sex exploitation perception deception power anarchy green social democratic participation japanese spy black-op false flag gladio terror.

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