Perfect Crimes

01 February 1995

This proposal was written in early February 1995, a month after the Mexican financial crisis and devaluation. I wanted to do this book as a follow-up to Faith and Credit and wrote the following pitch for a new book about financial speculation and the transfer of wealth from bottom to top. Such a book would have required some resources, particularly for travel, and these were not forthcoming from the potential funders I wrote to. The only taker, bless him, was the Rev. Sam Kobia of the Justice, Peace and Creation division of the World Council of Churches, who sent a small check [later used with his permission for another worthy cause]. Nobody else was at all interested.
History has nonethess shown that the intuition was correct and that such a book would have been useful. I was not especially surprised by the lack of enthusiasm for funding: progressive forces simply do not grasp [as the right does] the importance of ideas. [See also: Winning the War of Ideas.] Not a word of the text sent to potential funders has been changed and as I write this short introduction four years later, I am struck by the prescience of the proposal. Perhaps some funding sources may read this and understand that ideas and analysis are worth financing. They might even understand that they are not themselves always the best judges of what those ideas ought to be.

Is it possible to write a gripping, ironic, anecdote-filled yet factual and rigorous book about a desperately serious subject - as serious as the destabilisation of major governments, the appropriation of staggering sums of money, even the crash of civilisation-as-we-know-it?

We think it is - and with the help of a top-flight research team and of potential donors to whom this proposal is directed, we propose to undertake the task.

The context

Why us, and why now? Both of us have long been involved, at various levels, in exposing the institutions and the interest groups which are driving the global economy towards destruction while excluding hundreds of millions of people from its benefits.

By the thousands, in many different countries, people have read our books and attended our lectures, listened to us on the radio and watched us on television. Sometimes we have even changed peoples' lives, or so many have told us. Yet at the broader economic and political level, nothing has changed. Susan George observes that since she started publishing two decades ago, every issue she has dealt with (world hunger, third world debt, environmental degradation, North-South inequalities and the like) has grown worse. Why, then, bother to continue? Can one more book make a political difference?

We believe so, but not if the book is conceived in a traditional mode. In the late 20th century, it hardly seems possible to duplicate the achievements of Uncle Tom's Cabin or How the Other Half Lives in provoking reform and political action, even if one had the talent of a Harriet Beecher Stowe or a Jacob Riis. The factual, descriptive narrative denouncing one or another evil, along the lines of SG's How the Other Half Dies (over 100.000 copies sold in the Penguin edition alone), however well researched and written, also seems to be running out of steam. A law of political diminishing returns appears to be at work.

Instead of the melodramatic novel of slavery, the principled exposé of conditions in the New York slums, or the denunciation of the effects of world power structures; we propose to try the model of the detective story. What if outrageous and repeated criminal acts were being committed with impunity under our noses; what if we could prove that their perpetrators will strike again and again; that no one is safe? Most people don't sense danger until they realise that it is their wallet, their house and garden, their safety and security that are targeted. We want to make them feel those threats.

The content

Our working title is Perfect Crimes. These crimes imperil virtually everyone whether or not they are now aware of it. The crimes are financial; the book takes on the issue of free-floating money and short-term speculation in a fully globalised economy - with grim consequences for survival.

Financial operators now send some trillion dollars a day in short-term, speculative capital zooming around the planet. About ten percent of it is devoted to the so-called 'emerging markets' of the South. But whether the speculator targets Italy or France, Mexico or Turkey, the result is the same: governments no longer have the freedom to make independent policy choices. Policy is ultimately controlled by speculators as, to a great degree, are ordinary peoples' lives. This flying capital is not invested in production or trade; it is not just 'liquid' but indeed 'vapourous' or 'gaseous', since it can escape a country like steam from a kettle. Capital liquidity, to use the more traditional term, means enormous power of creditors over debtors, of investors over those who are literally 'invested', in the old sense of 'laid siege to', invaded.

Speculation is out of control. It is a multi-trillion dollar industry without any regulation whatsoever. The victims of the crimes committed in its name are identifiable and the criminals could, theoretically, be prosecuted under existing statutes of international law. But in fact, if they are to become subject to law, new international machinery will have to be invented and new statutes enforced. For the moment, the perpetrators of perfect financial crimes are the beneficiaries of an entirely deregulated system in which anything goes.

No less an expert than Sir James Goldsmith believes that the world financial system is headed for collapse. Everyone's savings would go down with it, and untold misery, far worse than that of the 1930s, would result. The Mexican crisis was a wake-up call but the $50 billion rapidly mobilised to bail out Wall Street won't be enough to stanch the haemorrhage. Within a few months of the crisis, an additional 750.000 Mexicans had lost their jobs and some forty million of them are considered to occupy at best a marginal place in the economy. Destabilisation on the borders of the US looms; meanwhile, other candidates for destabilisation are waiting in the wings.

Probably fewer than two-hundred firms/people today control the financial destiny of the world. Three pension funds alone control $500 billion. No government can withstand the speculative juggernaut once they set it in motion. When they decide to abandon a currency and a country they leave chaos in their wake. They tend to move in packs and to display similar behaviour patterns.

In their vocabulary, 'short-term' means between ten seconds and a day; 'long-term' means, at most, three months. Their métier has nothing to do with investment and they take no responsibility for the effects of their transactions. So long as they are making money, nothing else concerns them. Should they cease to make money (as in the case of major Mexican losses) they call upon governments and international financial institutions to rescue them. How long this will remain possible is anyone's guess.

Those who can bring a country like Mexico to the brink of collapse and ordinary Mexicans to the brink of annihilation, are referred to collectively as 'the market'. One point of this book is to demonstrate that there is no such thing. Although we can recognise the place where we buy our vegetables as 'the market', this financial 'market' is a myth and an illusion; one to which the media daily impart a spurious reality by describing it as an entity with human passions and reactions. The market is said to be 'depressed' or 'euphoric', 'nervous' or 'impatient'. Calling a system of immensely profitable speculative financial transactions 'the market' is an excellent way of hiding the quite small number of operators who actually stand behind it.

The method

We will work backwards from the victims - real or 'novelised' from composite portraits - moving towards the perpetrators, supplying 'scene-of-the-crime' detail, forensic evidence, interrogation of suspects and a prosecutor's (or a coroner's) investigation and cross examination. We will use various literary devices, within the basic framework of the detective story: narration, transcription of testimony, dialogues, biographies, perhaps even fiction (cf. the 'Interludes' in Faith & Credit).

The narrators (the authors) of the book are an investigator for the international organisation DEVICE (Defense and Empowerment of the VIctims of the Casino Economy) and an anthropologist out to prove that 'post-modern' people are nothing but primitives in disguise. They set out to uncover the shadowy figures capable of siphoning off vast wealth from the poor. Their inquiry takes them to Basle, London and New York; to Mexico, Turkey, Argentina, Russia and Eastern Europe, perhaps to Vietnam and South Africa as well.

They can eventually reveal the identities of those responsible and show that the perfect crimes of financial speculation are the work of an identifiable 'sect' or 'cult' which, like other sects, is expert in brainwashing, in accumulating vast wealth and power for its leaders, and at recruiting large numbers of followers who are only dimly aware of the real goals of the Organisation to which they have given over their lives. Such a sect is far more deadly than the Branch Davidians or the Aum Shinri-kyo that launched the gas attack in the Tokyo metro, its casualties are far more numerous, yet it pursues its activities unchallenged.


Instead of referring to abstract entities like 'the market', 'capital', the 'world economy', etc. our method will be concrete: we will introduce the reader to the flesh-and-blood actors who make this particular world go round (traders for pension funds and large banks, financial intermediaries, international institutions' personnel and the like).

We will interview some of these people as well as those who have all but given up the struggle to police their activities (national financial authorities and the Bank for International Settlements). We will show who wins and who loses from their transactions and reveal a system at once completely logical and totally ruthless in its operations. The book will thus be an essay in criminal anthropology and forensic detection, revealing the members of the 'sect of the market'.

What will this book accomplish?

- Perfect Crimes will prove to non-specialists in an entertaining way that understanding the latest innovations driving the international economy is neither complicated nor, certainly, beyond the reach of the intelligent reader. This is the same 'demystifying' modus operandi adopted by George, then George/Sabelli, for subjects like world hunger, transnational corporations, debt, the World Bank, etc. Financial speculation and capital markets are, however, generally seen as more 'abstract' than these subjects and thus more daunting and difficult to understand. When seen from the angle of winners and losers, criminels and victims, this ceases to be the case.

- We will demonstrate that for the first time in history, the ideal conditions for committing 'perfect crimes' exist. Vulnerable countries, formerly excluded from global financial circuits, are now fully integrated in them. Few of these new players have any defense mechanisms against financial invasion/investment (although Chile does, and we will describe that case). Structural adjustment programmes imposed upon these vulnerable countries carry the condition of openness to foreign capital. Creditors often convert old debt into new securities - which they can jettison at any time. Finally, the financial sphere has become totally disconnected from both production and trade. This autonomy is also a completely new phenomenon.

- While there are absolutely no guarantees that political authorities - dependent as they so often are on those who are committing financial crimes - will make the slightest attempt to control and to police the international sphere; we will nonetheless provide some approaches through which today's 'perfect criminals' could tomorrow be prevented from acting and even brought to justice.

Expected costs, budget and financing

To be successful and convincing, Perfect Crimes will need to be researched in several places, making it more expensive to produce than the previous George-Sabelli title Faith and Credit, which relied essentially on research at the World Bank plus correspondence and documents. For this book, we foresee research and interviews in Switzerland, Paris, London, New York, Washington, Boston, Mexico, Brazil, Russia and South Africa. Travel and accomodations will be a significant part of our costs. We will also need research assistance/local advisors for background, appointment-making, document collection, sometimes translation. Since we - the two authors - are geographically separated, we also need funds for copying, for communication and for working meetings as we proceed.

Publication does not appear to be a problem. Publishers in various countries (including Penguin) have expressed interest. We still intend to employ an agent for this book, particularly to reach the difficult United States market and to optimise distribution elsewhere, which will involve some up-front costs. Some people have wondered why we need to raise a budget if the book is to be commercially published - can't publishers pay us advances? The answer is that (1) advances are usually quite small unless one is a truly best-selling author (the most SG has ever received is 4000 pounds despite reasonably good sales) and (2) they are paid out half on delivery of the completed manuscript and half on publication. We have no choice but to ask for money!

Based on experience gained in producing Faith & Credit and on the additional expenses as outlined above:

Perfect Crimes can be brought to press for approximately $50.000.

This figure includes the standard 10 percent overhead for the Transnational Institute (TNI) which would channel and administer the budget. TNI's legal status is a Dutch 'Stichting' ('non-profit organisation'); its accounts are regularly audited by a qualified Dutch firm. We justify all our expenses with invoices and are reimbursed by TNI: we will receive no salary or honoraria for the project.

We are asking those who receive this proposal to contribute between 10 and 25 percent of the total budget; that is, from $5.000 to $12.500. Donors are, naturally, gratefully acknowledged in print in all editions of the book and with the media; they are supplied with periodic progress reports.

If, as we hope, you choose to contribute, kindly send your check to The Transnational Institute, Paulus Potterstraat 20, Amsterdam 1071 DA, Netherlands, Attn. Laurian Zwart; indicating that the sum should be credited to the Perfect Crimes Project. We would appreciate receiving copies, and any comments or suggestions you may have concerning the project as well:

Susan George and Fabrizio Sabelli

Bio-data, Susan George and Fabrizio Sabelli

Susan George was born in the US and is now a US-French citizen living near Paris. She is Associate Director of the Transnational Institute in Amsterdam. She holds degrees from Smith College (BA, Phi Beta Kappa), the Sorbonne (Licence ès Philosophie) and the Ecole des Hautes Etudes en Sciences Sociales (Ph.D.). She has published eight books on issues of North-South power relations: the most recent is Faith and Credit: the World Bank's Secular Empire (with Fabrizio Sabelli). Other titles include How the Other Half Dies: the Real Reasons for World Hunger, A Fate Worse than Debt, Ill Fares the Land (Penguin); Les Stratèges de la Faim (her doctoral dissertation, Grounauer and IUED, Geneva) and The Debt Boomerang (Pluto Press). Her work has been translated in more than a dozen languages. She serves on the Boards of Greenpeace International and Greenpeace France, works regularly with many other Non-Governmental Organisations and often appears on radio and television.

Fabrizio Sabelli was born in Rome where he studied at the Jesuit College of Massimo and at La Sapienza University where he obtained a degree in law. He later studied anthropology in Geneva and Neuchâtel before doing fieldwork in northern Ghana and travelling widely in Africa. He then settled in Switzerland, taking his doctorate in anthropology at the University of Neuchâtel. He is now a Professor at the University Institute of Development Studies (IUED), Geneva and at the University of Neuchâtel. By himself or with colleagues he is the author of several books: aside from Faith and Credit with Susan George, most recently La Mythologie Programmée, and a book on methodology, Recherche Anthropologique et Développement. He is a frequent contributor to French, Swiss and Italian periodicals, radio and television programmes.