(Roughly) Daily

Posts Tagged ‘free trade

“Money laundering is giving oxygen to organized crime”*…

The United States Treasury Department is putting art galleries and museums on notice over the high risks of financial crime in their trade, warning that various aspects of the art industry makes “it attractive to those engaged in illicit financial activity, including sanctions evasion.”

The advisory, published on Oct. 30, calls out the art industry’s heavy use of shell companies. Citing the “high degree of confidentiality and anonymity” in the art trade, the advisory cautions that art dealers may find themselves unwittingly working with criminals seeking to move illicit funds. It also notes that artwork’s often “subjective value” creates an additional attractive value to financial criminals — who are known to manipulate invoice prices to covertly shift money around the globe.

“The advisory serves as another reminder that the $28.3 billion American art market is the largest unregulated industry in the United States,” [said] Tess Davis, executive director of the Antiquities Coalition, which advocates the return of stolen relics to their home countries…

The U.S. Treasury urges new safeguards against financial crime, money laundering, and sanctions evasion: “Secretive high-end art world can be vehicle for dirty money.” From the International Consortium of Investigative Journalists, part of their on-going investigation of international money laundering, FinCEN Files.

Turns out that a U.S. Senate investigation led to the same conclusions: “The art world has a money laundering problem.” So did a House investigation: “Art and Money Laundering.”

And for the curious, here is a look at how it’s done: “Laundering money through art, if you’re into that sort of thing.”

All-too-appropriately, Hasbro has released, in collaboration with the Metropolitan Museum of Art, a fine-arts edition of its flagship game: “Monopoly: The Met Edition.”

* then-President of Mexico, Enrique Peña Nieto, June 2012. It’s alleged that he spoke with authority based on personal experience: in 2020, his successor as President, Andrés Manuel López Obrador, asked Mexicans if they would like to see former Mexican presidents face trial against allegations of corruption (a move deemed constitutional by the Mexican court and laws); the people will vote to decide in a referendum in 2021. According by a survey by newspaper El Universal, 78% of Mexicans polled do indeed want the former presidents of Mexico to face trial– and Enrique Peña Nieto is the one they most want to be incarcerated.

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As we note that cleanliness isn’t always next to godliness, we might spare a thought for Jean-Baptiste Say; he died on this date in 1832. An economist and businessman, Say argued in favor of competition, free trade, and the lifting of restraints on business, and was among the was among the first economists to study entrepreneurship– and to valorize entrepreneurs as organizers and leaders of the economy.

He is probably best remembered for the assertion that supply creates its own demand– “Say’s Law“– a label first used by John Maynard Keynes, who went on to argue that it is wrong… the debate (e.g., as between Steven Kates and Paul Krugman) continues to this day.

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“He got his fat dreams, he got his slaves / He got his profits, he owns our cage”*…

 

slave ship

Plan, profile and layout of the slave ship The Séraphique Marie

 

For a generation, the relationship between slavery and capitalism has preoccupied historians. The publication of several major pieces of scholarship on the matter has won attention from the media. Scholars demonstrate that the Industrial Revolution, centred on the mass production of cotton textiles in the factories of England and New England, depended on raw cotton grown by slaves on plantations in the American South. Capitalists often touted the superiority of the industrial economies and their supposedly ‘free labour’. ‘Free labour’ means the system in which workers are not enslaved but free to contract with any manufacturer they chose, free to sell their labour. It means that there is a labour market, not a slave market.

But because ‘free labour’ was working with and dependent on raw materials produced by slaves, the simple distinction between an industrial economy of free labour on the one hand and a slave-based plantation system on the other falls apart. So too does the boundary between the southern ‘slave states’ and northern ‘free states’ in America. While the South grew rich from plantation agriculture that depended on slave labour, New England also grew rich off the slave trade, investing in the shipping and maritime insurance that made the transport of slaves from Africa to the United States possible and profitable. The sale of enslaved Africans brought together agriculture and industry, north and south, forming a global commercial network from which the modern world emerged.

It is only in the past few decades that scholars have come to grips with how slavery and capitalism intertwined. But for the 18th-century French thinkers who laid the foundations of laissez-faire capitalism, it made perfect sense to associate the slave trade with free enterprise. Their writings, which inspired the Scottish philosopher Adam Smith’s Wealth of Nations (1776), aimed to convince the French monarchy to deregulate key businesses such as the sale of grain and trade with Asia. Only a few specialists read them today. Yet these pamphlets, letters and manuscripts clearly proclaim a powerful message: the birth of modern capitalism depended not only on the labour of enslaved people and the profits of the slave trade, but also on the example of slavery as a deregulated global enterprise…

[Adam] Smith became far more influential than his teacher. As his own version of laissez-faire ideas came to seem like common sense in the following century, the pioneering Gournay Circle was largely forgotten. Their sense that the slave trade was a prime example of free trade in action disappeared. Yet the writings of Gournay and Morellet reveal that modern capitalism is entangled with slavery in multiple, profound ways. Slave labour supplied the cotton, sugar and other vital commodities. The profits from the sale of slaves created fortunes on both sides of the Atlantic. And, in a disturbing paradox, the founding fathers of laissez-faire saw the slave trade as a showcase of liberty.

The chilling tale of a “secret ingredient” in capitalism-as-we-know-it and of the 18th-century thinkers behind the laissez-faire economics that power it: “Slavery as Free Trade.”

* Richie Havens, “Fate”

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As we face history, we might recall that it was on this date in 1789 that partisans of the Third Estate, impatient for social and legal reforms (and economic relief) in France, attacked and took control of the Bastille.  A fortress in Paris, the Bastille was a medieval armory and political prison; while it held only 8 inmates at the time, it resonated with the crowd as a symbol of the monarchy’s abuse of power.  Its fall ignited the French Revolution.  This date is now observed annually as France’s National Day.

See the estimable Robert Darnton’s “What Was Revolutionary about the French Revolution?

300px-Prise_de_la_Bastille

Storming of The Bastile, Jean-Pierre Houël

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