“The financial wars are coming” ~ Juan C. Zarate
By Catherine Austin Fitts
I am in the process of learning more about financial sanctions to gain a better understanding of the current dance between the European Union, Russia and the United States. In that effort, I just finished Treasury’s War: the Unleashing of a New Era of Financial Warfare by Juan C. Zarate.
Zarate is a senior advisor at the Center for Strategic and International Studies (CSIS) in Washington, DC and a former assistant secretary of treasury for terrorist financing and financial crimes and deputy national security advisor. Zarate was a key participant in the early development of the US application of the War on Terror to make foreign financial institutions and flows transparent to the US intelligence apparatus and to build the sanction toolkit being used to target countries, banks and individuals through the global financial system.
Zarate’s world view and analysis of what is going on and why are entirely different from mine. However, that is not my focus. My focus is understanding the nuts and bolts of how financial sanctions have developed and been applied. For this purpose, I found the book quite useful.
One of my investment associates refers to the legislation put in place after 9-11 as “the Concentration and Control of Cash Flow and Credit Acts.” What Zarate describes is a highly aggressive effort to make 1) global financial flows transparent to the US and 2) global financial institutions subject to US regulatory authority — particularly in Eurasia and the Middle East. As Nicolas Negroponte once said, “In a digital age, data about money is worth more than money.” The U.S. has gone to extraordinary lengths to make sure that data on global financial flows are accessible.
In his conclusion, Zarate points out that as we have developed and used such sanctions, now others are using them as well. The blowback is coming.
He points out that as the US works to prevent other nations from creating privacy and liquidity outside its control, it motivates the developing world to do so. He also warns of the development of cyber-currencies and the integration of financial warfare with cyberwarfare.
The topic of sanctions gets back to the age old question: is the purpose of the financial system to facilitate free commerce and trade along with the management and transfer of wealth? Or is it a battlefield to engage in financial and economic warfare as an alternative to physical warfare? Can a financial system be both?
Nothing threatens the dominance of the Anglo American financial system more than the impression that it is rigged and being run by people who regularly function outside of the law…and kill with impunity.
As we watch reports each week of US, European or Asian bankers killed or “suicide-ed,” we are reminded that the financial wars are not just coming — they are here.