On May 14, 2012, NPR Morning Edition’s Renee Montagne had a sit down interview with U.S. Ambassador to Afghanistan, Ryan Crocker. Below is the part where they talked about American taxpayers money flying out of Kabul International Airport to Dubai or other parts unknown. WARNING: You might need a barf bag
MONTAGNE: Suitcases filled with billions…
CROCKER: Oh, yeah. Exactly.
MONTAGNE: …of American dollars out of Kabul into parts unknown – Dubai, other parts unknown.
CROCKER: Ironically, you know, the fact that vast sums of money have been expatriated may lessen the impact on the overall economy of the true drawdown, because the money, in many cases, never made it into the Afghan economy. You know, I’m not saying that’s a good thing, but it may significantly lessen the blow when we get to the end of 2014.
MONTAGNE: Meaning, of all the billions that poured into this country, enough of it went to make some people rich and didn’t find its way into the economy, so that the economy will not be as hurt as it might have been had the money been more honorably distributed.
CROCKER: Absolutely. You know, in many cases, arguably, there was nothing illegitimate about a lot of it. I mean, these were contractors. They made their profits. Capital will go anywhere, where it’s the best investment opportunity. That’s where the capital will go, and that’s what happened in many of these cases.
If you need more, read here.
Just to be clear – this is President Obama’s official representative in Kabul, and does he believed this is just good money — profits and capital “fleeing” to other places like Dubai – in search of better investment opportunity?
Whoops! I think I just fell off my chair and gashed my poor brain!
Are we really this stupid?
In 2010, the WSJ reported that more than $3 billion in cash has been openly flown out of Kabul International Airport in the previous three years. It was a sum so large that “U.S. investigators believe top Afghan officials and their associates are sending billions of diverted U.S. aid and logistics dollars and drug money to financial safe havens abroad.”
“It’s not like they grow money on trees here,” said a U.S. official investigating corruption and Taliban financing. “A lot of this looks like our tax dollars being stolen. And opium, of course.”
In February this year, after Afghanistan’s central-bank governor said he will issue new currency restrictions to stem an exodus of billions of dollars in cash, the Wall Street Journal did a follow up report:
“Some $4.6 billion in cash, more than the entire government budget, was taken abroad through Kabul airport alone last year, according to Afghan central-bank data, double the $2.3 billion recorded in 2010. But even those figures “grossly” underestimate the real extent of overall money flight, central-bank governor Noorullah Delawari said in an interview.”
While Afghan officials promised to clean up the country’s financial system in 2010 in the aftermath of the WSJ report and after Congress temporarily froze U.S. assistance to Afghanistan, the Wall Street Journal reported that the money flow to Dubai and other financial havens has not abated. Instead it has only gathered speed as U.S. forces begin to pull out ahead of the 2014 deadline for transferring security responsibilities to the Afghan government.
These are mostly contractors’ money, of course. Nothing that taxpayers need to worry their already severely taxed brains.
But just in case, these are not “honest” money, should we not just ask these “contractors” for their Dubai offshore bank account? If we wire them the money directly, the money would not make it to the local economy either and would lessen the impact. And it would save our government paperwork and our investigators can dig out real corruption elsewhere.
And actually Dubai offshore bank accounts really rock. They offer a safe, legal and tax-free account structure providing complete anonymity and full legal tax exemption. Not only that, while “opening a foreign account under a private name would not cease one’s obligation to list it in one’s tax declaration,” that’s a small issue. “You could simply “forget” to declare it and hope nobody finds out.”
And just the place to “invest” one’s well-gotten wealth from the war zone…
- Businesses may flee Afghanistan after troop withdrawal (mercurynews.com)
- Canadian Forces officer fined for discharging pistol in Kabul airport (vancouversun.com)
- Correction: Afghan-NATO’s Waning War story (sfgate.com)
Crocker is stepping down. Planned? Sudden? Both?
GFF – Just saw that breaking in Twitter. Don’t know. But if I have to guess this is not planned. He was officially sworn in last July 2011. Granted that he was called back from retirement, ambassadors know that they cannot do much in a one-year assignment, and we almost never see one year assignments for chiefs of mission.
If this is true, something happened. In July last year, Amb Crocker said that there will be no rush for the exit. But the NATO planned agreed to in CHI put USG and NATO on the path for the “irreversible” pullout of foreign combat troops that will leave Afghan security forces with the leading role in combat operations by the summer of 2013.” It could be that, it could be something else, all speculation, of course.
One of RC’s favorite sayings was/is “don’t put lipstick on a pig”, but truth be told he has now presided over two massive, multi-billion dollar lipstick application efforts.
Fire engine red lipstick.
“CROCKER: Ironically, you know, the fact that vast sums of money have been expatriated may lessen the impact on the overall economy of the true drawdown, because the money, in many cases, never made it into the Afghan economy.”
That is one consideration that never occurred to me. Our drawdown might have more adverse impact on the real estate market in Dubai than it will have on Afghanistan. The nicer villas in Palm Jumeirah will become bargains.
TSB – I supposed it is too late now to get a real estate license in Dubai?
You have GOT to be kidding me.
Barf bag, indeed.
Please don’t use mine … it’s well, gross…