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Wall Street, the CIA, the Drug Trade, & Money for Blackmail, Black Ops, Overthrowing Governments, & World Domination
When the uninitiated think of the “Deep State,” they tend to imagine a group of men getting together in a room, smoking cigars and plotting world domination. But the Deep State is not one coordinated network of people controlling the government from the shadows.
Instead, it refers to individuals and groups that have the resources to shape the direction of the world to their benefit and don’t hesitate to make use of them. At times, the interests of different factions of the Deep State collide. That often happens when the direction of the world is rapidly changing, as is the case now after the election of Donald Trump.
Nobody knows this better than Peter Dale Scott, the foremost expert on the US Deep State. Below, you will find a new introduction to the paperback version of The American Deep State: Big Money, Big Oil, and the Struggle for U.S. Democracy, Updated Edition (copyright 2017), (with permission of the publisher, Rowman & Littlefield. All rights reserved). This is Part 1 of a two-part series.
Peter Dale Scott is a former Canadian diplomat, Professor of English at the University of California, Berkeley, co-founder of the Peace and Conflict Studies program at Berkeley, poet, and 2002 recipient of the Lannan Poetry Award.
His political books include Deep Politics and the Death of JFK (1993), The Road to 9/11: Wealth, Empire, and the Future of America (2007), The War Conspiracy: JFK, 9/11 and the Deep Politics of War (2008), American War Machine: Deep Politics, the CIA Global Drug Connection, and the Road to Afghanistan (2010), The American Deep State: Wall Street, Big Oil, and the Attack on U.S. Democracy (2014) and Dallas ’63: The First Deep State Revolt Against the White House (2015). A complete bibliography can be found on his website at http://www.peterdalescott.net.
***
On February 3, 2017, the Wall Street Journal reported President Trump’s plans to pave the way for a broad rollback of the recent financial reforms of Wall Street.[1] Although no surprise, the news was in ironic contrast to the rhetoric of his campaign, when he spent months denouncing both Ted Cruz and Hillary Clinton for their links to Goldman Sachs, even when his campaign’s Financial Chairman was a former Goldman Sachs banker, Steve Mnuchin (now Trump’s Treasury Secretary).
Trump was hardly the first candidate to run against the banking establishment while surreptitiously taking money from big bankers. So did Hitler in 1933; so did Obama in 2008. (In Obama’s final campaign speech of 2008, he attacked “the greed and irresponsibility of Wall Street.”[2] But it was revealed later that Wall Street bankers and financial insiders, chiefly from Goldman Sachs, had raised $42.2 million for Obama’s 2008 campaign, more than for any previous candidate in history.)[3]
However, Trump’s connections to big money, both new (often self-made) and old (mostly institutional) were not only more blatant than usual; some were also possibly more sinister. Trump’s campaign was probably the first ever to be (as we shall see) scrutinized by the FBI for “financial connections with Russian financial figures,” and even with a Russian bank whose Washington influence was attacked years ago, after it was allegedly investigated in Russia for possible mafia connections.[4]
Trump’s appointment of the third former Goldman executive to lead Treasury in the last four administrations, after Robert Rubin (under Clinton) and Hank Paulson (under Bush), has reinforced recent speculation about Trump’s relationship to what is increasingly referred to as the deep state. That is the topic of this essay.
But we must first see what is really meant by ‘the deep state”.
What Is Meant by the Deep State?
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Since 2007, when I first referred to a “deep state” in America, the term has become a meme, and even the topic of a cautious essay in The New York Times.[5] Recently it has been enhanced by a new meme, “the ’deep state’ versus Trump,” a theme that promoted Donald Trump as a genuine outsider, and entered the electoral campaign as early as August 2016.[6]
Trump reinforced this notion when he expressed opposition to America’s international defense alliances and trade deals that both traditional parties had long supported, as well as by his promise to “drain the Washington swamp.” It was encouraged again post-election by Trump’s longtime political advisor Roger Stone, formerly of the Washington lobbying firm Black, Manafort, Stone, and Kelly, once a major feature of that swamp.[7]
But those who saw the election as a contest between outsider Trump and a “deep state” tended to give two different meanings to this new term. On the one hand were those who saw the deep state as “a conglomerate of insiders” incorporating all those, outside and inside the traditional state, who “run the country no matter who is in the White House…and without the consent of voters.”[8] On the other were those who, like Chris Hedges, limited the “deep state” to those perverting constitutional American politics from the margin of the Washington Beltway — “the security and surveillance apparatus, the war machine.”[9]
But both of these simplistic definitions, suitable for campaign rhetoric, omit the commanding role played by big money — what used to be referred to as Wall Street, but now includes an increasingly powerful number of maverick non-financial billionaires like the Koch brothers. All serious studies of the deep state, including Mike Lofgren’s The Deep State and Philip Giraldi’s Deep State America as well as this book, acknowledge the importance of big money.[10]
It is important to recognize moreover, that the current division between “red” and “blue” America is overshadowed by a corresponding division at the level of big money, one that contributed greatly to the ugliness of the 2016 campaign. In The American Deep State (p. 30), I mention, albeit very briefly, the opposition of right-wing oilmen and the John Birch Society “to the relative internationalism of Wall Street.”[11] That opposition has become more powerful, and better financed, than ever before.
It has also evolved. As I noted in The American Deep State, (p. 14), the deep state “is not a structure but a system, as difficult to define, but also as real and powerful, as a weather system.” A vigorous deep state, like America, encompasses dynamic processes continuously generating new forces within it like the Internet — just as a weather system is not fixed but changes from day to day.
The Current Divisions in America and Its Wealth
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Three days before the inauguration of Donald Trump, “Frontline” on PBS began a two-part program, “Divided States of America,” documenting how the polarization of American public opinion has contributed to both stagnation in Washington and widespread popular anger, on both the left and the right, against the traditional two-party system.
The Frontline show failed to address the major role played by money in aggravating this public division. For example, it followed many popular accounts in tracing the emergence of the tax-revolt Tea Party to the apparently spontaneous call on February 19, 2009, by CNBC reporter Rick Santelli in Chicago, for a “tea party,” in response to President Barack Obama’s expensive bailouts.[12]
However, this event (on the floor of the Chicago Mercantile Exchange, a deep state institution) was not only staged, it had been prepared for in advance. A domain name, chicagoteaparty.org, had been registered for it in 2008, before Obama had even been elected.[13] Jane Mayer has conclusively demonstrated the role in the funding groups behind the Tea Party played by the brothers Charles and David Koch, who in 2014 were two of the ten richest people on earth, worth a combined $32 billion as owners of the largest private oil company in America.[14] (Today their wealth is estimated at $84 billion.)
More important, as Mayer pointed out, the Tea Party was not “a new strain” in American politics. The scale was unusual, but history had shown that similar reactionary forces had attacked virtually every Democratic president since Franklin Roosevelt. Earlier business-funded right-wing movements, from the Liberty League [of the 1930s] to the John Birch Society to [Richard Mellon] Scaife’s [anti-Clinton] Arkansas Project, all had cast Democratic presidents as traitors, usurpers, and threats to the Constitution. The undeniable element of racial resentment that tinged many Tea Party rallies was also an old and disgracefully enduring story in American politics.[15]
The Kochs’ lavish funding of the Tea Party, along with anti-tax candidates and climate-change deniers, was only one more phase in what I described in 1996 as an enduring struggle between “America Firsters” and “New World Order” globalists, pitting, through nearly all of this [20th] century, the industry-oriented (e.g. the National Association of Manufacturers) against the financial-oriented (e.g. the Council on Foreign Relations), two different sources of wealth.[16]
A decade later Trump has revived the slogan of “America First!”, and vowed to reconsider both NATO and multilateral trade. Both factions are still there today; but, as we shall see, both now have international connections.
American Politics and the Increase in Wealth Disparity
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Mayer’s helpful overview overlooks the alarming increase in wealth disparity since 1980 and especially in the last decade. Ten years ago, when I published The Road to 9/11, I noted that 225 billionaires owned as much as the bottom fifty percent of people in the world, and I repeated Kevin Phillips’ warning that
“As the twenty-first century gets underway, the imbalance of wealth and democracy in the United States is unsustainable…. Either democracy must be renewed, with politics brought back to life, or wealth is likely to cement a new and less democratic regime— plutocracy by some other name.”[17]
In 2010, only three years later, that indicator of disparity had risen up the pyramid from 225 billionaires to 43; and today the figure has shrunk still further to eight.[18]
Larry Ellison, Jeff Bezos, Mark Zuckerberg, Bill Gates
As The New York Times reported in October 2015, just 158 families supplied half of the early money that had already poured into the 2016 campaign, and 138 of these families supported Republican candidates. Sixty-four of these 138 families made their fortunes in finance, mostly in hedge funds, private equity or venture capital. A further seventeen families were wealthy from energy, mostly oil and gas. What both these two groups were seeking was lower taxes and also deregulation: repeal of the Dodd-Frank Act reforming Wall Street, and (according to the Times) a lifting of the 40-year-old ban on export of US oil.[19]
Many were also “tied to networks of ideological donors who, on the left and the right alike, have sought to fundamentally reshape their own political parties” — on the one hand the twice-yearly anti-tax seminars hosted by the Kochs, and on the other “the Democracy Alliance, a network of liberal donors who have pushed Democrats to move aggressively on climate change legislation and progressive taxation.”[20]
Once again, a division in the American public was being fomented and funded by an old division within Big Money — roughly speaking, between those Trilateral Commission progressives, many flourishing from the new technologies of the global Internet, who wish the state to do more than at present about problems like wealth disparity, racial injustice and global warming, and those Heritage Foundation conservatives, many from finance and oil, who want it to do even less.
We see this ideological split even among the top eight US super billionaires in 2016, four of whom (Bill Gates, Jeff Bezos, Mark Zuckerberg, and Larry Ellison) have made their fortunes from the Internet and want the present US to progress more or less along its recent course. Warren Buffett (once number one, now number three) endorsed Hillary Clinton early on, “while calling for increased taxes on the country’s highest wage earners.”[21] Deeply dissatisfied with the status quo were numbers seven and eight, the Koch brothers, who “have fortunes largely drawn from fossil fuels,” and have “poured money into fighting solar.”[22]
Warren Buffett
The Kochs assembled a donor network of fellow mavericks, many of whom were distinguished by private ownership of their businesses, and many (Jane Mayer pointed out) “had serious past or ongoing legal problems.”[23] In early 2015 their organization revealed that it would spend $889 million leading up to the 2016 presidential contest. As USA Today reported, this unprecedented sum, “unrivaled for an outside organization, represents more than double the nearly $400 million the Republican National Committee (RNC) raised and spent during the 2012 presidential election cycle.”[24] This huge organized flow of outside funds has contributed greatly to the weakening of party discipline in Congress, especially among Republicans.
Throughout the campaign, the Kochs and Trump (whose chief backer was another maverick billionaire, Robert Mercer) were apparently at arm’s length from each other. Vanity Fair suggested in September that at that time the Kochs were “in direct opposition to the Mercers,” in a “civil war that threatens to tear the party apart” — even though, starting around 2011, the Mercers had been donating “at least $1 million a year to the Koch network.”[25]
Whatever the tensions, it was clear after the election that Trump in his transition team had “surrounded himself with people tied to the Kochs.”[26] Soon the Trump nominee for Education Secretary was Betsy DeVos, another major billionaire contributor to the Koch donor list. (Betsy’s brother Erik Prince, famous as the founder and owner of the notorious private army Blackwater, was quietly advising the Trump transition team on matters related to intelligence and defense.)[27]
And Trump’s CIA Director is Mike Pompeo, formerly a Koch-sponsored congressman “who was so closely entwined with the climate-change denying Koch brothers that he was known as the ‘congressman from Koch.”[28] (The new administration has reportedly instructed the Environmental Protection Agency to remove the climate change page from its website.)[29]
David Koch, Charles Koch
Since his election, Trump has attacked the U.S. intelligence agencies for leaking information, and reporters as being among “the most dishonest human beings on Earth.” But while attacking the Washington establishment, he is clearly reflecting the dissident big money faction of the deep state, no longer as marginal as it was in the era of the John Birch Society and later Goldwater.[30]
As the campaign and pre-inaugural preparations progressed, it became clearer that Trump, no stranger to the world of big money, had brought the old big money camp into his campaign, as well as the new. In January 2017 Trump nominated to be his SEC Chairman Jay Clayton, a Sullivan & Cromwell partner who in the past has represented Goldman Sachs and other big banks in Wall street superdeals.[31]
Clayton is the fourth former Goldman-related Trump nominee for the new administration, all of them chosen under the eyes of Trump’s chief strategist, Stephen K. Bannon, himself a former Goldman banker who moved on to become a Tea Party coordinator and executive director at the alt-right Breitbart News. (Bannon once promised to build “an insurgent, center-right populist movement that is virulently anti-establishment.”[32] It took only 10 days in the White House to make it clear that Bannon had “rapidly amassed power in the West Wing, eclipsing chief of staff Reince Priebus.”) [33]
Undoubtedly Trump entered politics as a maverick real estate investor and TV star, funding the early stages of his campaign himself. But as his campaign grew, he came to reach out more and more to Wall Street financing, notably from Robert Mercer, the co-CEO of hedge fund Renaissance Technologies,[34] Then Trump named as his campaign’s Finance Chairman Steve Mnuchin, formerly of Skull and Bones and Goldman Sachs.[35]
As many predicted, Mnuchin later became Trump’s nominee for Treasury Secretary, which could make him the third former Goldman executive to lead Treasury in the last four administrations, after Robert Rubin and Hank Paulson. In addition, Trump has named Gary Cohn, former president of Goldman Sachs, as his chief economic advisor and Director of the National Economic Council.[36]
In short, Trump did not challenge but preserved the status of what Jeffrey Sachs has called the Wall Street-Washington complex, which has steered the financial system toward control by a few politically powerful Wall Street firms, notably Goldman Sachs, JPMorgan Chase, Citigroup, Morgan Stanley, and a handful of other financial firms.[37]
Meanwhile, just as Trump expanded his financial base to all elements of big money, so Wall Street, as it always does, ensured it had good connections to both of the final candidates. After Mnuchin joined the Trump campaign, Lloyd Blankfein, chief executive officer of Goldman Sachs announced in October 2016 his support of Hillary Clinton.[38]
All of this complexity calls for further reflection on the nature of the deep state.
Goldman Sachs
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To survey the more serious accounts of the “deep state in the United States,” it is useful to begin with their summary in Wikipedia under this title: as a “state within a state, which [authors] suspect exerts influence and control over public policy, regardless of which political party controls the country’s democratic institutions.”
Citing five different authors, (including myself) Wikipedia expands this definition to include the military–industrial complex, intelligence community, Wall Street, plutocrats, “big oil,” the mainstream media, national security officials, and Silicon Valley.[39]
All five authors see two essential components to the deep state. On the one hand is big money. On the other are the extra-constitutional Washington Beltway agencies like CIA that Wall Street originally campaigned for and staffed, along with the government-oriented industries that these agencies and the Pentagon work with and outsource to.[40]
Besides myself, Philip Giraldi and Mike Lofgren have also recognized that “the term was actually coined in Turkey, and is said to be a system composed of high-level elements within the intelligence services, military, security, judiciary, and organized crime.”[41] A more precise definition is that of Hugh Roberts:
The notion of the deep state … originated in Turkey, where it connoted not merely the secretive apparatuses of the state such as the police and intelligence services but above all the shady nexus between them, certain politicians and organised crime.[42]
But I may be the only author showing the extent to which the Turkish deep state, when first exposed in 1996, both overlapped with the American deep state and revealed its dark underside.
The Turkish term “deep State” (deren devlet) was coined after the so-called Susurluk incident, a 1996 car crash whose victims included the deputy chief of the Istanbul Police Department, a Member of Parliament, and Abdullah Çatlı, an international heroin trafficker and killer recruited by the Turkish police for “special missions” and paid in heroin while he was officially being sought by the Turkish authorities for murder.[43]
We see in the Susurluk incident three features of the Turkish deep state, unmentioned by Lofgren, that not only resemble the American deep state but are actually a significant component of it (and still of major importance today).
The first is that it was partly international: Abdullah Çatlı was part of a death squad chiefly recruited from the ranks of the Turkish OHD (Ozel Harp Dairesi – Special Warfare Department). The OHD had originally been set up with US encouragement as the Turkish branch of NATO’s Operation Gladio, a stay-behind force in the event of a Warsaw Pact invasion. Diverted and renamed Counter-Guerrilla to suppress the Kurdish resistance movement, the OHD troops continued to be trained in the US and to use US counterinsurgency manuals.[44]
Abdullah Çatli, Turkey, Deep State
The second is that the international deep state connection revealed at Susurluk was partly criminal: the sanctioned para-state activities with Çatlı were financed by billions of dollars in profits from drug smuggling; just as the CIA in Laos and elsewhere utilized a protected drug traffic to finance its covert operations in Burma, Thailand, Laos, and Afghanistan.[45] Çatlı, a convicted drug trafficker with a special Turkish passport, was himself part of this post-Gladio international network:
Çatlı, according to Yalçın and Yurdakal, visited Miami in 1982 in the company of a known Gladio agent (and Italian neo-Nazi) and was considered to be “under the protection” of the CIA.[46]
(The Gladio agent was Stefano delle Chiaie, who had his own connections to state-sponsored terrorist activities in Italy, to the World Anti-Communist League or WACL, and more specifically to death squads working for the Operation Condor murder operation in Latin America, sponsored by the right-wing dictatorships in the region.[47] The CIA had its own shadowy connections to all three, as well as to Gladio.)
The third feature of the Susurluk event is that it was and remains a largely inscrutable intelligence-related event, or what in this book I call a “deep event,” like similar events in the United States, such as the John F. Kennedy assassination. Nearly all western accounts of the car crash overlook the claim that it was not an accident but an intended assassination.[48] Moreover the Turkish deep state was later suspected in the Turkish coup attempt of Ergenekon in 2007,[49] and its one-time parent, the US deep state, in the failed military coup of July 2016.[50] Both of these coup attempts reveal elements of what I mean by deep events.
Not just in Turkey, but also in the United States, respected authors have linked the deep state to what I call (pp. 98, 119) “structural deep events,” unsolved mysterious events that affect the political system of the country.[51] As I write, there have been a series of charges that, if substantiated, would seem to link Trump not only to an element of the American deep state, but also to an element of the Russian deep state.
~~~
Along the lines of teaching a man to fish,
What I Learned From The Declassified CIA Archive - YouTube
Wall Street, the CIA, the Drug Trade, & Money for Blackmail, Black Ops, Overthrowing Governments, & World Domination Swami -- Wednesday, 8-Feb-2017 16:34:59
