The new movie “Kill the Messenger,” about journalist Gary Webb’s investigation into the connection between Contra drug running and the CIA in the 80s, is not exactly water cooler material at the moment. As of this writing Box Office Mojo has its widest release as 427 theaters (compare to 3,173 for the current box office champ), and it doesn’t seem to have much of a marketing push behind it (your mileage may vary). But what it lacks in mainstream buzz it’s making up for in political controversy. Washington Post assistant managing editor Jeff Leen published a piece last Friday decrying Webb’s “canonization” on film, and in doing so invited a new round of scrutiny of the Contra/CIA connection.
The best place to start reviewing the story is the 1989 report by the Senate Foreign Relations Committee titled Drugs, Law Enforcement And Foreign Policy (I’ve scanned it with optical character recognition here if you’d like to copy and paste as well as read). It covers a lot of territory, but the sections on Nicaragua are especially interesting when considering Webb’s reporting seven years later.
What did the Committee have to say? First, on page 6 (page 16 of the PDF - add ten pages to the PDF to get to the corresponding Committee pagination) it acknowledges one of the difficulties with investigating a criminal enterprise: “A number of witnesses and prospective witnesses were convicted felons, having been imprisoned for narcotics-related offenses. The Subcommittee made use of these witnesses in Accordance with the practice of Federal and State prosecutors, who routinely rely on convicts as witnesses in criminal trials because they are the ones with the most intimate knowledge of the criminal activity.” When wading into a cesspool of corruption it is often difficult to figure out which scumbag to believe. Relying on things like statements against interest can help sort things out, but it’s obviously going to be an inexact science.
That acknowledged, here’s what they found. The Contras were involved in drug running and US agencies knew it (p. 36):
While the contra/drug question was not the primary focus of the investigation, the Subcommittee uncovered considerable evidence relating to the Contra network which substantiated many of the initial allegations laid out before the Committee in the Spring of 1986. On the basis of this evidence, it is clear that individuals who provided support for the Contras were involved in drug trafficking, the supply network of the Contras was used by drug trafficking organizations, and elements of the Contras themselves knowingly received financial and material assistance from drug traffickers. In each case, one or another agency of the U.S. government had information regarding the involvement either while it was occurring, or immediately thereafter.
The entire gun/drug scene was mercenary (pp. 36-7):
The Subcommittee found that the links that were forged between the Contras and the drug traffickers were primarily pragmatic, rather than ideological. The drug traffickers, who had significant financial and material resources, needed the cover of legitimate activity for their criminal enterprises. A trafficker like George Morales hoped to have his drug indictment dropped in return for his financial and material support of the Contras. Others, in the words of Marcos Aguado, Eden Pastora’s air force chief:…took advantage Of the anti-communist sentiment which existed in Central America … and they undoubtedly used it for drug trafficking.While for some Contras, it was a matter of survival, for the traffickers it was just another business deal to promote and protect their own operations.
They apparently were graduates not of the School of the Americas but the Milo Minderbinder Institute for Profiteering (p. 40):
When the Sandinista insurgency succeeded in 1979, smuggling activity in northern Costa Rica did not stop. Surplus weapons originally stored in Costa Rica for use by the Sandinistas were sold on the black market in the region. Some of these weapons were shipped to the Salvadoran rebels from the same airstrips in the same planes, flown by the same pilots who had previously worked for the Sandinistas.
The drug lords were only too happy to benefit (p. 41):
Following their work on behalf of the Sandinistas and the Salvadoran rebels, the Colombian and Panamanian drug operatives were well positioned to exploit the infrastructure now serving and supplying the Contra Southern Front [a Contra base just across the border in Costa Rica]. This infrastructure was increasingly important to the drug traffickers, as this was the very period  in which the cocaine trade to the U.S. from Latin America was growing exponentially.
The Contras were funded by drug money and that was fine with at least some of the individuals running the show (p. 41):
The logic of having drug money pay for the pressing needs of the Contras appealed to a number of people who became involved in the covert war. Indeed, senior U.S. policy makers were not immune to the idea that drug money was a perfect solution to the Contra’s funding problems.
As DEA officials testified last July before the House Judiciary Subcommittee on Crime, Lt. Col. Oliver North suggested to the DEA in June 1985 that $1.5 million in drug money carried aboard a plane piloted by DEA informant Barry Seal and generated in a sting of the Medellin Cartel and Sandinista officials, be provided to the Contras. While the suggestion was rejected by the DEA, the fact that it was made highlights the potential appeal of drug profits for persons engaged in covert activity.
[Werner] Lotz [a Costa Rican pilot and convicted drug smuggler] said that Contra operations on the Southern Front were in fact funded by drug operations. He testified that weapons for the Contras came from Panama on small planes carrying mixed loads which included drugs. The pilots unloaded the weapons, refueled, and headed north toward the U.S. with drugs. The pilots included Americans, Panamanians, and Colombians, and occasionally, uniformed members of the Panamanian Defense Forces.
We have the names of some of those running drugs to the US (p. 43):
Pilots who made combined Contra weapons/drug flights through the Southern Front included:
— Gerardo Duran, a Costa Rican pilot in the airplane parts supply business. Duran flew for a variety of Contra organizations on the Southern Front, including those affiliated with Alfonso Robelo, Fernando “El Negro” Chamorro, and Eden Pastora, before U.S. officials insisted that the Contras sever their ties from Duran because of his involvement with drugs. Duran was convicted of narcotics trafficking in Costa Rica in 1987 and jailed.
— Gary Wayne Betzner, drug pilot who worked for convicted smuggler George Morales. Betzner testified that twice in 1984 he flew weapons for the Contras from the U.S. to northern Costa Rica and returned to the United States with loads of cocaine. Betzner is presently serving a lengthy prison term for drug smuggling.
— Jose “Chepon” Robelo, the head of UDN-FARN air force on the Southern front. Robelo turned to narcotics trafficking and reselling goods provided to the Contras by the U.S.
And we know at least one city the drugs were being flown to (p. 46):
In September, 1984, Miami police officials advised the FBI of information they had received that Ocean Hunter [a money laundering operation fronting as a seafood company] was funding contra activities through “narcotics transactions,” and nothing that Luis Rodriguez was its president. This information confirmed previous accounts the FBI had received concerning the involvement of Ocean Hunter and its officers in Contra supply operations involving the Cuban American community.
To recap: Various undifferentiated groups of psychopaths were fighting endless internecine wars against each other and wreaking havoc on the civilian populations that had the misfortune to be nearby. The engine for these conflicts was a professional class of amoral drug kingpins and bagmen who set up a drug pipeline to America. And the US, apparently in search of adventure, decided to pick a side. In other words, an appalling scandal.
The report gives the most generous possible interpretation for this by introducing the “blind eye” narrative (p. 44):
At best, these incidents represent negligence on the part of U.S. government officials responsible for providing support to the Contras. At worst it was a matter of turning a blind eye, to the, activities of companies who use legitimate activities as a cover for their narcotics trafficking.
But there are still some open questions (p. 42):
The State Department selected four companies owned and operated by narcotics traffickers to supply humanitarian assistance to the Contras…In each case, prior to the time that the State Department entered into contracts with the company, federal law enforcement had received information that the individuals controlling these companies were involved in narcotics…A number of questions arise as a result of the selection of these four companies by the State Department for the provision of humanitarian assistance to the contras, to which the Subcommittee has been unable to obtain clear answers:
— Who selected these firms to provide services to the Contras, paid for with public funds, and what criteria were used for selecting them?
— Were any U.S. officials in the CIA, NSC, or State Department aware of the narcotics allegations associated with any of these companies? If so, why were these firms permitted to receive public funds on behalf of the Contras?
— Why were Contra suppliers not checked against federal law enforcement records that would have shown them to be either under active investigation as drug traffickers, or in the case of DIASCA, actually under indictment?
The concern highlights the degree to which the infrastructure used by the Contras and that used by drug traffickers was potentially interchangeable, even in a situation in which the U.S. government had itself established and maintained the airstrip involved.
The whole operation crippled attempts to come to grips with the drug problem (p. 123):
The most graphic example of this Conflict between law enforcement and foreign policy priorities is that of Richard Gregorie, who for eight years led the war on drugs in the U.S. Attorney’s office in Miami. He had achieved a reputation as one of the nation’s most effective and toughest federal narcotics prosecutors.
Yet, Gregorie, in frustration, resigned his position in January of this year due to increasing opposition he was meeting from the State Department to his investigations and indictments of foreign officials.
In an interview with NBC, aired on February 22, 1989, Gregorie said the opposition from the State Department made it almost impossible to pursue top cocaine bosses. He stated, in that interview: “I am finding the higher we go, the further I investigate matters involving Panama, high level corruption in Colombia, in Honduras, in the Bahamas, they are concerned that we are going to cause a problem in foreign policy areas and that that is more important than stopping the dope problem.”
Lastly, the drug runners were remarkably effective at evading law enforcement - but then their luck began running out (p. 53):
Thomas Castillo, the former CIA station chief in Costa Rica, who was indicted in connection with the Iran/Contra affair, testified before the Iran/Contra Committees that when the CIA became aware of narcotics trafficking by Pastorals supporters and lieutenants, those individuals’ activities were reported to law enforcement officials. However, Morales continued to work with the Contras until January 1986. He was indicted for a second time in the Southern District of Florida for a January 1986 cocaine flight to Bahamas and was arrested on June 12, 1986.
In October 1986 Congress approved $100 million in funds for the Contras. Is it too much to think that the plug got pulled on such an unsavory clandestine operation in anticipation of a windfall of taxpayer money? And that there may have been some kind of extraordinary forbearance shown to the drug runners when they had no public funding? Sure, that would mean something more than studied ignorance was going on - which would conflict with the preferred version of events. But the Committee report establishes a solid foundation for anyone looking to fill in the gaps. I don’t know how anyone can read that report and conclude, as Leen does, that it’s the final word on the matter. It’s just the opposite: an invitation to further investigation.
Given the vast scope of the program, its duration, and the abundance of details provided by the report, it strains credulity to think that the entire time US operatives were just standing on the sideline watching. So when, years later, Webb accepted the invitation, the resulting series shouldn’t have been seen as a fundamental change of narrative. Rather, it was a clarification of the blind eye/active encouragement questions left open by the Committee report. Why was it so explosive then? Robert Parry has a thought:
Webb’s series wasn’t just a story about drug traffickers in Central America and their protectors in Washington. It was about the on-the-ground consequences, inside the United States, of that drug trafficking, how the lives of Americans were blighted and destroyed as the collateral damage of a U.S. foreign policy initiative.
In other words, there were real-life American victims, and they were concentrated in African-American communities. That meant the ever-sensitive issue of race had been injected into the controversy. Anger from black communities spread quickly to the Congressional Black Caucus, which started demanding answers.
It’s one thing to write about trafficking and smuggling. It’s quite another to identify the destination of that traffic and into whose hands the smuggled goods ended. Webb’s series has been preserved by Narco News, and you can read part one, part two and part three for yourself. Webb’s pieces sound a number of themes from the Committee report, such as the frustration of drug investigations:
Agents from four organizations — the DEA, U.S. Customs, the Los Angeles County Sheriff’s Department and the California Bureau of Narcotic Enforcement — have complained that investigations were hampered by the CIA or unnamed “national security” interests.
And the withdrawal of support for the program:
According to a December 1986 FBI Teletype, [Bradley] Brunon [defense attorney for Contra leader and drug dealer Oscar Danilo Blandon Reyes] told the officers that the “CIA winked at this sort of thing. … (Brunon) indicated that now that U.S. Congress had voted funds for the Nicaraguan Contra movement, U.S. government now appears to be turning against organizations like this.”…Blandon has also implied that his cocaine sales were, for a time, CIA-approved. He told a San Francisco federal grand jury in 1994 that once the FDN began receiving American taxpayer dollars, the CIA no longer needed his kind of help.
That last quote actually supports the “blind eye” theory and just calls it a wink instead. But here’s the rub: you can’t reconcile a wink with the change in the smugglers’ fortunes post-Congressional funding. If some person or agency was clearing the field for those activities - and again, the Committee report suggests as much, it’s not new - then the blind eye narrative is blown out of the water.
We aren’t talking blind eye anymore, but neither are we talking about CIA agents selling drugs in south central Los Angeles. So it’s ludicrous for Leen to write Webb claimed “the Central Intelligence Agency was responsible for the crack cocaine epidemic in America.” Why resort to such hyperbolic falsehood? Maybe because knocking out the support from under the blind eye version of events would be incredibly damaging to the CIA’s reputation and credibility (and Leen seems particularly sympathetic to the agency). So instead of trying to re-establish blind eye, Leen makes an outlandish characterization of Webb’s reporting. Readers who are not familiar with it (and Leen unhelpfully does not provide links) will be inclined to think Webb a crank and his reporting discredited.
What’s even more extraordinary is that Leen was “an investigative reporter covering the drug trade for the Miami Herald” during the time in question. While he was on that beat the United States Senate released a report disclosing, among other things, that a money laundering operation in Miami was funding the Contras through drug sales. Yet he writes:
Beginning in 1985, journalists started pursuing tips about the CIA’s role in the drug trade. Was the agency allowing cocaine to flow into the United States as a means to fund its secret war supporting the contra rebels in Nicaragua? Many journalists, including me, chased that story from different angles, but the extraordinary proof was always lacking.
Weren’t the activities of Ocean Hunter, helpfully supplied by the Senate - no chasing required! - worthy of a deep dive? It’s just astounding that the abundance of leads in the Committee report was taken not as the jumping off point for a whole new round of investigations but the final word on the CIA’s blamelessness. Parry has an apt description (via Charles Pierce) of Leen’s brand of investigative journalism:
journalists need “extraordinary proof” if a story puts the U.S. government or an “ally” in a negative light but pretty much anything goes when criticizing an “enemy.”
If, for instance, the Post wanted to accuse the Syrian government of killing civilians with Sarin gas or blame Russian-backed rebels for the shoot-down of a civilian airliner over Ukraine, any scraps of proof – no matter how dubious – would be good enough (as was the actual case in 2013 and 2014, respectively).
However, if new evidence undercut those suspicions and shifted the blame to people on “the U.S. side” – say, the Syrian rebels and the Ukrainian government – then the standards of proof suddenly skyrocket beyond reach.
“Extraordinary proof” is not an ironclad principle adhered to though the heavens may fall, but a tactic that is first evaluated against political exigency.
In the comments to Leen’s piece (the Post doesn’t permalink comments, so either wade through them yourself or trust me on this one) linerider writes:
As stated before Webb all but claimed the CIA created the crack epidemic. Go back and read the articles. Not simply that they ignored their sources in the business; not that drugs weren’t a national security issue to them, but that real, honest-to-god spooks ran drugs. That’s the inference. They didn’t and running with that lead discredited everything else he wrote.
Was the CIA wrong in turning a blind eye to the traffickers? As much so as they are in turning a blind eye to anyone who provides a major need in the fulfillment of our national goals. Would they ignore drug trafficking being done by, say the Kurds, if the Kurds were using the money to fight ISIS? Would the nation consider that acceptable? And would we claim that the CIA was all but running the drugs into the United States by associating with Kurds and ignoring that backdoor funding or would we recognize the nuance - a nuance rarely found in the age of 7 day/24 hour internet reporting?
I have no idea who that individual is, but the comment is a great example of Washington’s perpetual conflict mentality, beginning with the smearing of a credible report (“Webb all but claimed the CIA created the crack epidemic…That’s the inference.”) Go back and read the articles indeed.
The second paragraph is the really interesting one, though. How would we think about its contemporary analogue? Would we be OK with the Kurds running heroin to the US (ideally in a newly engineered form that made it cheaper, more potent, and suitable for transport to America’s urban areas, I suppose)? God knows the war-firsters have been hyping the nonexistent threat from ISIS and would like nothing more than to drop another round of freedom bombs. Launching a new war certainly casts a new light on a little smuggling. So would we recognize the, ahem, nuance? Personally, I’d say absolutely fucking not, and the suggestion that this is some kind of grey area is indicative of a terribly skewed moral compass. But as a window into a certain kind of bellicose mindset I find it fascinating.
More importantly, consider this. In Webb’s first article he describes the Contra war as “barely a memory today.” It turns out the Sandinistas weren’t so important after all. Looking back, it seems hard to believe the US went to such lengths to oppose them. That’s why linerider’s analogy is so valuable. ISIS poses the same threat to us now that the Sandinistas did in the 80s. If we resist the urge to turn them into heroes and martyrs, they will burn out or fade away. Yet now, as then, a wildly exaggerated threat is being hyped. Now, as then, we don’t know much about who we are being asked to support. Now, as then, we don’t really know what’s happening on the ground. You don’t need to be Nostradamus to see how this will all look in twenty or thirty years. But by then we will be on to our next wild ride, and the next Gary Webb - should we be fortunate enough to have one - will be long fallen from respectability.
- A couple noteworthy comments to the Washington Post article. I found the Committee report courtesy of Patrick J. Kiger:
Forget about whether or not Webb overreached. Read the Kerry committee report http://www2.gwu.edu/~nsarchiv/NSAEBB/NSAEBB113/north06.pdf In it, you have operatives in a CIA and NSC-run operation who are simultaneously involved in drug trafficking, including (on page 42) a pilot who flew guns to the Contras and then returned to the US with drugs. This is just a sample of the sort of stuff than went on during the Reagan administration, some of which makes the Right’s worst allegations against President Obama look trivial.Geri72 wrote the following about the film’s distribution:
Is it also worth noting that the distributors of this film, Focus, have absolutely killed it. They have done the barest minimum of marketing and instead of slowly increasing the number of screens to allow for word of mouth, they dumped it in a few hundred, which is both too many and not enough; too many to be costly to sustain without an audience primed and ready, too few to get the word out on social media. It is likely they will pull it completely within the next week or so.
- Leen makes much of how Webb’s editor “backed away” from (note: not retracted) the story. Among the items:
Blandon testified he stopped sending cocaine profits to the Contras at the end of 1982, after being in operation for a year.The clarifications don’t change the thesis, though. The Contras were getting drug profits, but for not as long (in one case, anyway) as indicated. They were making lots of money from drug sales, but only estimates are available. It seems to me a journalist worth his salt would take these items as a reason to dig further into rather than bury the story.
The evidence also suggested that millions in profits were sent to the Contras from cocaine sales to Ross and others, Ceppos wrote…”We didn’t know for certain what the profits were, and I feel that we should have made it clear that our figures were estimates,” Ceppos wrote.
- Beginning on page 124 of the Committee report is a section titled “THE CONSEQUENCES OF PRIVATIZING U.S. FOREIGN POLICY.” It’s worth looking at both for its historical value and how it foreshadowed subsequent developments in that area.
- Lest you think intelligence and executive branch agencies giving Congress the finger is a recent development, look at the following from the report.
Pp. 38-9 (emphasis added):
On May 6, 1986, a bipartisan group of Committee staff met with representatives of the Justice Department, FBI, DEA, CIA and State Department to discuss the allegations that Senator Kerry had received information of Neutrality Act Violations, gun running and drug trafficking in association with Contra organizations based on the Southern Front in Costa Rica.P. 39:
In the days leading up to the meeting, Justice Department spokesmen were stating publicly that “the FBI had conducted an inquiry into all of these charges and none of them have any substance. At that meeting, Justice Department officials privately contradicted the numerous public statements from the Department that these allegations had been investigated thoroughly and were determined to be without foundation. The Justice Department officials at the meeting said the public statements by Justice were “inaccurate.” The Justice officials confirmed there were ongoing Neutrality. Act investigations in connection with the allegations raised by Senator Kerry.
At the same meeting, representatives of the CIA categorically denied that the Neutrality Act violations raised by the Committee staff had in fact taken place, citing classified documents which the CIA did not make available to the Committee. In fact, at the time, the FBI had already assembled substantial information confirming the Neutrality Act violations, including admissions by some of the persons involved indicating that crimes had taken place.
The Justice Department refused to provide any information in response to this request on the grounds that the information remained under active investigation, and that the Committee’s “rambling through open investigations gravely risks compromising those efforts.”P. 60:
At the May 6, 1986 meeting with Committee staff, the CIA categorically denied that weapons had been shipped to the Contras from the United States on the flights involving Rene Corbo, noting that the material on which they were basing these assertions was classified, and suggested that the allegations that had been made to the contrary were the result of disinformation.These agencies have learned they can act with impunity towards Congress, which doesn’t inspire confidence in the end product of the upcoming torture report.
In fact, as the FBI had previously learned from informants, Cuban American supporters of the Contras had shipped weapons from south Florida to Ilopango, and from there to John Hull’s airstrips in Costa Rica.
The “we are the first generation of parents to” lifestyle piece is a hardy perennial that probably shouldn’t even exist. There really is nothing new under the parenting sun; everything is just a variation on the anxieties parents have always faced. I suspect that pre-parenthood obliviousness, combined with the frighteningly intimate quality of those worries once they appear, cause a lot of parents to think there is something novel about it all.
Allison Slater Tate has the latest version: Now with Internet! Apparently those of us in Generation X had “low-tech childhoods” (the hell?) but now “we are among the first of the truly high-tech parents.” So we, unlike every previous generation of parents in human history, have to grapple with the implications of technology on our children. Because when I was a kid we were never browbeaten about how telephones were destroying our social skills, or how all we did was stare slack-jawed in front of screens for hours on end, or how pocket calculators were reducing us to button-punching ignoramuses. (Sumerian parent, circa 2500 BC: “Gilgamesh, put down that abacus and learn how to count!”)
I’m sympathetic to the concerns parents have about wanting kids who are socially adept and have acquired a taste for the subtler pleasures in life. I want that for mine as well. But agonizing over the corrupting influence of technology itself is silly. As Athenae wrote, what exactly about text messages makes teenagers not awkward and romance not sweet? Teenagers use the available technology to navigate the same waters we did, that our parents did, and on and on. They just have more tools available, and good for them. If anything, they’re doing a better job than us. A one sentence text message from my kid is roughly once sentence more than I saw fit to communicate most days with my parents when I was his age.
In pieces like Tate’s, young people do not just have access to technology, don’t just find it absorbing, but are consumed by it - sucked into a void that parents are helpless to pull them out of. First of all, sometimes it’s pretty nice to have a kid so engrossed in something that the outside world disappears. From personal experience: Three boys quietly playing handheld games in the back seat are three boys not screaming at and hitting each other. Keep that PS Vita charged up, Junior!
But beyond that, they gravitate to other things as they get older. Teenagers today, like always, 1) have an insatiable craving for that which is authentic (not manufactured, processed, targeted at them, hip, in style, whatever) and 2) pick up a lot from their parents through osmosis. On that second point, for example, one of my oldest son’s friends knows more about Lou Reed’s solo work than I do - because his dad is a huge fan and he heard Lou all the time growing up. Even without that, older things - that aren’t advertised to them but that they discover more or less on their own - have real cachet. I know a few teens more fluent in Pink Floyd than contemporary music.
Parents are not helpless observers, either. They can engage both by sharing their kids’ enthusiasms (Minecraft isn’t that hard to learn, for God’s sake) and sharing their own youthful enthusiasms. I hung on to the Great Brain books I loved as a child, and have had a lot of fun reading them to my own. Kids aren’t going to just know how cool low tech alternatives can be - more often than not they’ll need a proper introduction.
A little intuition can go a long way, too. When my oldest went crazy for Skyrim I figured he might enjoy Dungeons and Dragons. Since the only way to really learn D&D is to have someone who knows it show you the ropes, I had him invite some friends over, pulled out the old books and had them roll up some characters. Once they got the hang of it, they loved it - and began bringing friends along. (Full disclosure: I did all of this primarily because I am an arrested adolescent and still geek out over D&D as much now as I did when I was fourteen.) We have sessions every week that last several hours. Sure they check their phones, but for the most part they are interacting with each other and having a good time engaging in some improvisational storytelling.
In fact, it’s possible that today’s young people are more receptive than ever to in-person experiences. In a time of declining driver rates and pay to play extracurriculars, teenagers don’t have the occasion or ability to congregate like they used to. It’s been my observation that they leap at such opportunities when they present themselves, and see social media as a poor substitute. Instead of fretting over how attached they seem to be to tech, why not put an alternative in front of them? If they don’t dig it, try something else. If nothing seems to click, relax - kids are naturally restless. Sooner or later they’ll wander off whatever path has been laid out before them and find something they can get fired up about. And then you’ll really start to worry.
A couple of weeks ago Alice Marshall responded to some of the criticisms I made of Modern Monetary Theory (MMT) a few months back. Her post is a good summary of both what I agree with about Modern Monetary Theory and my reservations. In fact, these few sentences put both in a nutshell:
Taxes do not finance government expenditure at the federal level. That alone is reason to embrace MMT. If it explains the world as it is, and I put it to you that it does, than we should use it as a basis for public policy.
I agree 100% with the first two sentences, which cover the monetary theory part of Modern Monetary Theory. Modern Monetary Theory can and should be used against those who call for austerity because we (allegedly) have no money. As I wrote earlier, though, I don’t think a successful effort would end the call for cuts in government spending:
The people who oppose policy like a job guarantee do not do so because they haven’t been introduced to a sufficiently persuasive economic model. They do so because they are ideologically opposed to federal social programs, and if you take away their current argument (“because no money”) they will just substitute it with the next handiest one (“because inflation”). But that’s not a legitimate problem, you say? No it isn’t. Neither is insolvency. Has that deterred them so far?
Still, succeeding would make those who used the “we’re broke” excuse look foolish, and that would have political consequences. As I concluded before, that seems like a tall enough order by itself.
So far, so good. It’s the extension of Modern Monetary Theory beyond monetary theory where I start to have reservations. Using Modern Monetary Theory as the basis for public policy is tricky because in addition to justifying liberal priorities like funding safety net programs or a job guarantee, it can also be used for neoliberal ends like slashing taxes and eliminating the minimum wage. When Modern Monetary Theory stops being a monetary theory, vague notions like “public purpose” and “productive capacity” come into play. Marshall admits we already have Modern Monetary Theory for big banks, as evidenced by the bailout and other extraordinary measures. Who is to say public purpose hasn’t been served by that? Who’s to say there isn’t an abundance of productive capacity bottled up in our entrepreneurial job creators just waiting to be unleashed by the elimination of the capital gains tax?
Nothing about Modern Monetary Theory is inherently just or equitable. It is, as Alice says, just a description of the way the world works - which is why I don’t really understand liberals putting a whole lot of time or energy into it. If one’s priority is the establishment (or protection) of just and equitable policies, Modern Monetary Theory is a terrible place to start. Every bit of time and effort getting it broadly accepted will get you precisely zero percent closer to those goals.
There isn’t a single founder of Modern Monetary Theory or a canonical text. Everything beyond that initial monetary theory is up for grabs. I’ve cited people presented as authorities on the subject only to be told they weren’t really MMT. But since there isn’t a single definitive source on how Modern Monetary Theory defines its non-monetary theory terms, that can be an argument against any objection. No one is MMT - or everyone is.
Those on the left tend to fall back on a sort of “MMT plus” formulation, as Alice does: “Speaking only for myself, I consider increasing taxes on the rich as necessary for preserving democracy.” Right, because Modern Monetary Theory can be used to justify cutting taxes, and whoever wins the battle for the soul of MMT will get to decide just how liberal - or neoliberal - it will be in practice. Which side would you bet on, particularly if it starts to be taken seriously? Political and economic elites have a pretty good track record of co-opting movements. One that has the enormous wiggle room of Modern Monetary Theory’s non-monetary theory components could be immediately put in their service, without even a brief period of progressive utility.
That’s why I think it is better to make the case for liberal policy up front, instead of obscuring it behind a Rorschach test presented as a monetary theory. Make the case for a job or income guarantee, or better funding of social programs, or what have you, make that case directly. If anyone asks how to pay for it, MMT. But lead by arguing in terms of justice and equity. Modern Monetary Theory is the details, and details belong in the background.
We’ve known for a while that fracking wells have serious integrity issues. A couple of years ago Anthony Ingraffea reported (PDF) on extensive well failures in Pennsylvania’s Marcellus shale. In June Ingraffea and a team of researches at Cornell followed up with a study estimating forty percent of Marcellus wells will fail over time. Newer wells appear to show higher leakage rates than older ones, so structural integrity is an increasing risk. Since there is no financial or regulatory incentive to build them well, they are getting less and not more reliable. The team also noted that the oil and gas industry was not exactly forthcoming on this topic:
Due to the lack of publicly available structural integrity monitoring records for onshore wells from industry, more recent studies have used data from state well inspection records to estimate the proportion of unconventional wells drilled that develop cement and/or casing structural integrity issues.
This is terrible, but at this point it is not news. So it was a little surprising Monday to see a new study about the structural integrity of fracking wells getting lots of play. Not that I’m complaining - better late than never - but it just seems like something to be treated as further confirmation of what we already knew, not some startling new discovery.
To her credit, Becky Oskin brought up the prior study and framed it in context. Mose Buchele of StateImpact Texas didn’t bring in the Marcellus angle, though maybe it’s outside his scope. A couple other reports really missed the mark though, and for the same reason: an industry-friendly framing of the scope of fracking.
From an environmental, policy, and public health perspective, fracking ought to be viewed as any activity in the entire industrial chain of unconventional natural gas extraction. Silica sand mining in Minnesota is fracking. Its transport to sites is fracking. The drilling of the well is fracking, the extraction from the well is fracking, the transport of the gas is fracking, and the storage of the toxic byproducts - until the last molecule goes inert - is fracking. Calling just the extraction of natural gas fracking is misleading at best and deceptive at worst, because that thing could not exist without all those other things. For anyone who cares about the entire impact of the process, it is absurd to characterize one part as the entirety.
Yet that is just what Matt McGrath of the BBC did, in an article headlined “Weak wells not fracking caused US gas leaks into water.” His article largely gives a pass to the industry, at one point flatly stating: “In none of the investigated wells was there a direct link to fracking.” As though those with contaminated water will be relieved the reason was shoddy practices by the industry and not something intrinsic to drilling. Ben Geman’s piece similarly leads with that framing: “They found that problems with gas-well construction, not fracking itself, is letting gases escape and reach drinking-water wells in some cases.”
Geman does a good job including caveats, and towards the end argues against exactly the framing he uses at the top: “the issues of water quality and fracking can’t be considered in isolation regardless of what’s allowing contaminants to escape.” But it’s damned frustrating to see what most people will take away - the headline and the start of the article - make the opposite point.
It could be that McGrath and Geman were too quick to accept a carefully parsed description from one of the authors:
“These results appear to rule out the possibility that methane has migrated up into drinking water aquifers because of horizontal drilling or hydraulic fracturing, as some people feared,” said Prof Avner Vengosh, from Duke University.
The team attempted to isolate a single variable and examine it, which they did, and they reported the results. All well and good. But outlets like the BBC and the National Journal report on a PNAS paper in the public’s interest. In other words, the important thing here is not the “horizontal drilling” part but the “methane in drinking water” part. So a study that exonerates one part of the process, but that says nothing about another (already-known) reason for contamination, gets us exactly nowhere in terms of its importance for the average citizen.
Maybe the reporters were swayed by the optimistic recommendations from the researchers. McGrath: “‘You need strong rules and regulations on well integrity,’ said Prof Jackson.” Geman: “[Ohio State earth-sciences professor Thomas Darrah] said that the findings are ‘relatively good news’ because ‘most of the issues we have identified can potentially be avoided by future improvements in well integrity.’” I don’t see how an industry that pushes through anti-transparency exceptions, buys politicians left and right, routinely outpaces the ability of agencies to monitor it, requires omertà for regulators but has a revolving door for them when they leave, violates the law yet continues to operate with impunity, doesn’t have sound construction practices elsewhere, and has a corrosive effect on democracy itself is going to embrace strict new rules on well construction.
That seems to be an important bit of context for the story. Leading with an (at best) incomplete framing and following up with hopeful policy prescriptions from scientists seems more likely to misinform readers than enlighten them. Because here is the message that comes across: There is a great and wonderful theoretical version of fracking out there we all should believe in, and any failure to see it in the real world is the fault of those who don’t share the vision, not of fracking itself. Yet somehow the fracking we end up with always ends up being so much worse than the fracking we are promised. Maybe someone could write an article about that.
On Monday the New York Times ran a piece by Nelson D. Schwartz titled “Boom in Energy Spurs Industry in the Rust Belt.” As straight news articles go, it’s not very straight. For some reason, the Times likes to give the occasional sloppy, um, kiss to the fracking industry, and this seems to be the latest in the series.
Near the start is a “correlation equals causation” argument: Fracking is big in northeast Ohio; factory hiring has ticked up in northeast Ohio; therefore fracking has led to the uptick:
Here in Ohio, in an arc stretching south from Youngstown past Canton and into the rural parts of the state where much of the natural gas is being drawn from shale deep underground, entire sectors like manufacturing, hotels, real estate and even law are being reshaped. A series of recent economic indicators, including factory hiring, shows momentum building nationally in the manufacturing sector.
Schwartz provides one example of actual causation, a pipe mill that employs 350 workers. That’s definitely good news for those employed there, but is it an example of the kind of region-transforming development that would justify the expansive tone? He notes the site used to house a mill that employed 1,400 people when it closed in 1979. And even though 1,400 dwarfs the number now working there, it only represents the last gasp of a dying industry. If you want to compare it to a “good old days” picture you need to go back a couple of years - to before Sept. 19, 1977, Black Monday, when 5,000 people were laid off. If you really want to talk about a reshaping, those are the kind of employment numbers you need to see. (Towards the end of the article Schwartz calls it a “nascent renaissance,” which is a considerably scaled down vision from the top of the piece.)
An anecdote is not data, and the data is out there for those who want to find it. Dean Baker looked at manufacturing employment in Youngstown and found that it is still way down from before the recession. As for fracking’s contribution to the employment picture, a study earlier this summer found: “Since the beginning of the recession, the mining and logging sector, which includes the shale gas industry, has only created 1,300 jobs.” So even when bundled with the numbers of a larger sector, its employment contribution is tiny.
Schwartz’ “momentum building nationally” wording is problematic, too. People don’t live in aggregate. Industry jobs often go to out-of-state workers, and even regional employment gains may be temporary. Once again, we aren’t talking steel mills here. There aren’t thousands of locals being employed long term at good wages, and implying otherwise is a disservice to readers. Considering that employment has increased less than 1 percent in the counties with the highest number of shale wells, the boom in energy doesn’t seem to be reaching many ordinary Ohioans.
So if manufacturing isn’t getting a boost from fracking, what about hotels, real estate and law? That last one is hard to figure from the article; Schwartz quotes a managing partner at a law firm who is considering hiring more people. How exactly does that add up to an entire sector being reshaped? He doesn’t mention how real estate being transformed either, though presumably he doesn’t mean in terms of people being evicted from their homes, having their houses razed or not being able to buy insurance policies for them.
As for hotels, Schwartz mentions an investor planning to build one. Again, not revolutionary. Now, hotels can see a bump in revenue as migrant workers come in to build infrastructure, but that is a temporary benefit. Funny enough, it’s become something of a fallback position for the industry as the job bonanza stubbornly refuses to materialize: “We need to look downstream from the drilling rig and realize all the auxiliary economic activity that swirls around this thing.” Not jobs, mind you, but auxiliary economic activity.
Finally, the article leans heavily on boosterism (“a real game-changer in terms of the U.S. economy”) and hopeful projections (“production of shale gas and so-called tight oil from shale could help create up to 1.7 million jobs nationally. Many of those jobs are expected to end up in places like this”) from industry consultants. But none of the spin is given any kind of scrutiny, it is just uncritically passed along.
Look, I’m as happy as the next guy that the New York Times decided to parachute in and give the area its unvarnished appraisal (“Youngstown and surrounding Mahoning County is hardly Silicon Valley or even Pittsburgh”), but getting a story like this right requires a little more than a visit to the chamber of commerce and a deli. The next time they pack up their pith helmets and mosquito netting for a trip here, it would be nice if they brought along a little curiosity too.