Reading the sad story of the City of Birmingham, Alabama featured in Rolling Stone of last month, one comes off with a feeling of familiarity as an African and an indirect (or perhaps direct) victim of organized (or perhaps institutionalized) Western "conmen in suits". The stories of municipal or private woes that have led to the worst financial crisis in decades in the West which led to rising debts, failing states like Greece and Iceland mirrors the tale of woes the trailed the influx of Western consultants and loan peddlers in newly independent Africa in the 70s and 80s.
At its height, freshly indicted Goldman Sachs, along with its Wall Street cousins like JP Morgan, Citi Group, Merrill Lynch, Lehman Brothers & Bear Stearns (now dead or on life-support) exploited the ignorance of consumers and municipalities in America and Western European cities to create financial instruments widely tagged "financial weapons of mass destruction" by Warren Buffet, Synthetic Swaps or CDOs (Collateralized debt obligations). CDOs were used to pad municipal budgets, create low interest mortgage that postponed principal payments and lent to consumers with shitty credits and low probability of paying back, which in turn destroyed the global economy in 2008.
Similarly, the 1970 through 1990 was Africa's lost decade due to ballooning debt given to dictators like Ibrahim Babangida (that kleptomaniac) of Nigeria and Mobutu Sese-Seko of Zaire, who in turn looted them and left their countries in ruins. Only now is the West's experiencing the horror of its own lost decade under greed-with capitalism gone wild. The experience of America under Goldman Sachs reminds one of the international loan sharking institutions (Paris and London Clubs), who screwed the third world and still made out like Saints.
A read of Rolling Stone's Talibi's expose on wall street looting of main street America or its precursor on how the great "vampire squid" called Goldman Sachs defrauded its customers and corrupted the system, will reveal the same cunning human deviousness that preceded Africa's debt and poverty crisis, is what preceded its Western successor. Only this time, one cannot but figure karma may well be at work. Payback as they say is a sure thing (the b-word may be more appropriate here).
Today, Greece is reeling under a debt load that is threatening to put her into bankruptcy. Iceland already is bankrupt, and many Scandinavian municipalities (like Narvik, Norway) are reeling under the load of untold debt obligations brought about "shiny men in Armani suits" that sold them pieces of crap, and called it wizardry. Guess what? Nothing is new. The same Westerners that snorted their nose at Africa, and blamed her post-independence problems on poor African citizens instead of smart pant corrupt bankers that forced debts down the throats of those newly and unsophisticated independent countries (through sell-out dictators) are today victims of their own deviousness. Truly, Karma is for real.
Of course, as soon as those smart pants at Bretton Wood and Paris Club educated bankers found their turf in Africa impoverished and unable to meet their tasking payments, where else would then turn than to pounce on their own? A read of the book, "Confessions of an Economic Hit man" (by John Perkins) and say the Faber's famed documentary "House of Cards" or "The Big Short" by Michael Lewis, will reveal the same mental callosity called greed drove the impoverishment of Africa in the 80s, and now the West . The same bankers, or perhaps their progenies, wrote the lopsided development loans at World Bank for Peru and Ghana, and those crazy once sided municipal bond contracts that torpedoed Birmingham and Narvik.
It is hard and sad to say, but fact is the modus operandi and methodology is exact the same and am afraid the result thereof is going to be similar i.e. no serious repercussions for the offenders. First, they bribe the deciding authority or blackmail them. In Africa they found willing dictators, in Birmingham they found obscene men like Bill Blount and his friend, President Langford; basically men who will be willing to sell their mothers for a pot of porridge. In return, they gave loans whose ins and outs are confusing even to a professional. Using a series of churning tactics, refinance it is now called and it used to be debt servicing, the lender ensures fees and interest rates are paid many times over. In the end, innocent taxpayers are left with the bills with the clear connivance of regulators and governments that should know better.
It is on the repercussion side that this current crisis seems to be mirroring the crisis that saw nations like Argentina, Ghana and Nigeria reeling in the 80s and 90s under debt. Like Paris modern day Shylocks that demanded flesh and blood for their debts, Goldman Sachs and JP Morgan are not any shy about demanding payments. They did the same in Russia in the 90s, here they go again.
Indeed, regardless of the underlying fraud and shifty dealings behind the transactions that gave rise to the current financial crisis, the governments of the world are not awake to their duty of demanding retribution of these evil doers i.e. the very banks that created the mess. Forget all the hype, Goldman Sachs insists it is "doing the work of God"; and with Obama's lawyer as their chief counsel, the Securities Exchange Commission is chasing its own shadow. Now, Obama instead of forcefully demanding reforms is busy begging the criminals to join him in reforms; whoever gives up their loot that voluntarily?
Perhaps through the concept Karma one can explain why Western Sovereigns, who themselves supervised the fleecing of African nations, cannot now demand that their own corporate pinheads play by a different rule field than they played on just a short while ago. For going by this logic, quite a number of debts owed by the most highly indebted nations of the world in the third world may today face annulment due to the fraudulent origin of its originators and servicers. The West never demanded Paris nor London Club to give up the loot, why should Goldman Sachs?
I hope Western institutions, and their citizens quickly come to terms with the fact that the latest scheme originating from Wall Street is basically payback for a regime of greed, callousness and wickedness she unleashed on the rest of the world in the recent past. Greed is like genie, once it is out it cannot be easily put back into the bottle. Once the fat cat financiers that drove hundreds of countries in South America and Africa into default and permanent poverty in the 80s got to perfect and master their scheme on the third world, in no time, their homes and families as well as friends were next on the list of target. A criminal knows no bounds.
I am very sure as soon as the West is impoverished these criminals will soon look east. China, are you listening? It goes clockwise, starting from Africa. Welcome to our world.
To further readings from the writer, visit www.busanga.com