Dollarization and the United Narcostates of America

A disturbing trend is developing amongst neo-imperialist nations and the countries that they are seeking to exploit. Western countries and the United States in particular are leveraging, and possibly encouraging hard-drug usage and addiction at home in order to facilitate the economic takeover of foreign economies. More than a trend, these international social and economic practices have served as a major financial buffer and investment pool for the sordid affairs of the United States, constituting an astonishingly malicious crime that is over a century old and remains ongoing.

In America the number of people who use cocaine regularly is higher than 3.6 million, including crack users, while heroin abusers are untallied, though invariably over a million in this country. There are also millions more heavy-narcotic consumers worldwide, concentrated in Europe, Central Asia, and Latin America. The millions of domestic users form the base from which profits are taken, in the form of drug money, US dollars, in order to fund pro-US governments abroad and expand the influence of the dollar.


From the first economic contact between the British East India company and poppy producing regions in Asia, opium has become a major narcotic in the Western and world markets, both legally and illegally. Wars have been fought over the importation of opium in Asia, and at every step of the way, Western powers have been vitally involved in its production and distribution. These cartel-like military incursions have developed into extremely lucrative and subversive markets that introduce the US dollar into foreign economies.

It is not surprising that the three countries that have pursued major military action in Afghanistan now import the most opium and heroin from the region—England, Russia, and finally, the United States. During the 19th century, England attempted to colonize much of South and Central Asia, claiming them for the crown, despite local organization. They then established in the region an extremely powerful militant economic force that restructured trade in the entire region ushering in an era of addiction.

The explicit agenda of economic take-over of the colonized land rapidly manifested itself in the increase of opium production and distribution across the British Empire and its subsidiaries. Seen as a reliable cash crop, poppy fields replaced basic food production across much of Northern India, becoming a British monopoly in 1773. This product was then exported to various countries where it was legal, such as England, but also to China, were it was officially banned by the ruling dynasty.

The effects of opium on such a large, productive country as China were widespread, the addiction was crippling, and so the Chinese began looking for a solution to their national drug problem. From 1839 to 1860, China fought two Opium Wars to prevent England from importing the drug into Chinese territory, but the British military fought bravely to insure continued economic relations with China. The British East India Company made a killing off the lucrative contraband drug trade, which it used to fund its colonial campaigns worldwide. It wasn’t until the Communist revolution in China that opium use was finally stamped out as a major cultural trope.

A century later, the United States entered into conflict with the Vietnamese people, initiating a new round of opium production and trade, but this time in the Golden Triangle—Vietnam, Laos, Thailand, Myanmar. At one point during the Vietnam conflict, up to 20% of America ground troops were using opiates, while hundreds of kilos were shipped stateside in the caskets of dead soldiers. The introduction of cheap heroin to the American poor turned into a profitable machine used to halt Communism in the region. After US withdrawal from the region, most of the countries continue to produce opium for export except for the two Communist countries, Cambodia and Vietnam, who learned quickly that Western intervention was two-fold—militaristic and narcotic.

Most recently, Afghanistan has risen to international prominence in the opium trade, responsible for over 80% of the global opium stock, of which “authorities” only intercept a small percentage. Although Central Asia, also known as the Golden Crescent has long been known for its fields of waving bluish-green poppy buds, leaking out the white narco-latex that is then refined into heroin, morphine, and a slew of legal opiate preparations, the trade is now astronomical.

This cash crop has engulfed the entire narcostate of Afghanistan, now worth an estimated $65 billion across the globe!—more than many major American corporations. The Afghan opium consortium has become particularly powerful in the destabilized region, exporting 3,500 tonnes per year—almost twice as much as the East India Company formerly exported to China. This economic boon is said to support regional “terrorist” groups, although most farmers only grow enough for subsistence and much of the money involved in the trade is generated and invested outside of the country.

Addiction is undoubtedly wide spread in the countries importing, whether legally or illegally, but the negative side effects of heroin don’t end there. And while 100,000 people a year are dying of heroin-related causes worldwide, even more people are beginning their experience with it. These users are actually investors, funding the US’s neo-imperialist infiltration of the Afghani financial system by flooding it with US dollars and demand for an unsustainable cash crop.

That’s right, the people of Afghanistan have traded their food crops and peace for an era of opium and war, and the US has gained not only a powerful regional military presence, but an entire economy to boot. The war in Afghanistan has brought hundreds of thousands of soldiers to the region to fight an elusive terrorist mastermind, but in the meanwhile, Western powers have built complex military installations at a prominent crossroads between four nuclear powers—Iran, Pakistan, China, and Russia. The dissolution of regional authority under US police action has directly increased the amount of opium being exported to and consumed in Iran and China.

In Afghanistan right now, the Afghani and the dollar are pretty much interchangeable. It is astounding to American personnel stationed in Afghanistan that their US dollars are just as good as at a 7-11 back home. This isn’t an accident—the illicit trade in opium has single-handedly introduced the dollar as a stable medium of transaction in the region. It is so prominent that Karzai’s government had to pass a law requiring vendors to list their prices in the native Afghani in addition to its pricing in dollars. The use of the dollar abroad means not only increased security for the US Treasury, but also a guaranteed trade partner in the dollarized nation.

As mentioned above, opiates are also legally imported into the US. Under certain special laws and with certain certification, pharmaceutical companies can contract poppy plantations to grow and export the narcotic for medicinal application. These prescription drug firms, such as Purdue Pharma—the manufacturers of popular opiates OxyContin and Percocet—are currently seeking legal avenues to import even more raw material as demand for prescriptions increase. Despite the apparent legality of these operations, they still serve to numb Americans while simultaneously crippling exporter narcostates.

Major pharmaceutical corporations, with the legislative support of the government, have been expanding the opiate market in the United States and in foreign markets. In 2002, OxyContin made $1.5 billion in sales, making it not only the most popular prescription, but the best marketed one—OC beach hats and Frisbees are available through their website. Since then, sales have increased dramatically, partially due to relaxed prescription laws allowing doctors to dole out medication with almost no oversight, leading to broad resale schemes. In Florida they have pain clinics where you need nothing more than an anecdotal affliction to walk away with generous prescriptions.

There are more regular prescription opiate users in America than there are heroin users on earth, and they represent a prodigious consumer group, unwittingly investing in a war for power and fields of purple blossoms—the muse for our artists from Oscar Wilde to Roberto Bolaño. The United States is the narcostate—AirAmerica exposed it on 29/10—CIA funds and operatives have been used to expand the growth and export of opium in Central Asia. Because the funds generated in the illicit and sanctioned trade of opium and heroin has increased US capital at the cost of its own people and the residents of foreign lands. Is this a facet of our culture worth fighting and dying for?


The American coca trade has risen in recent years to far outreach the opiate trade in general. The sale of cocaine within the US alone has generated over $70 billion, almost entirely underground. Since the coca boom of the 1980’s usage has risen drastically, no longer confined to certain social classes—most citadins can obtain cocaine or crack quite easily and for competitive pricing. This vast trade, encompasses much of the American hemisphere, from South America, through Central American and the Caribbean to the United States and Europe, has led to mass addiction and the vicious dollarization of Latin America.

Although coca usage in the Americas is considered an indigenous practice, Spanish colonialism and the US Monroe Doctrine neo-colonialism are linked directly to the international rise of the destructive cocaine trade, in more than casual ways. Conquistadors in some areas of the Pacific Rim would give enslaved native coca instead of food to encourage them to work harder and ensure a quick death for a people under genocide.

Since the abolishment of colonial powers in most of Latin America and the Caribbean, the United States has stepped in as a major economic and military presence in the region. Sending troops to Mexico, Nicaragua, Cuba, and other countries in order to ensure the installation of friendly dictators, the US used its martial influence to exploit their natural resources—minerals and plantation products. US neo-colonialist policies and practice, whether carried out by government funded groups or private corporations, developed into an efficient machine for the consumption and global exportation of cocaine starting in the 1970’s, while introducing the dollar to coca producing regions as a replacement for their sometimes unstable national currencies.

In 1986, it came to light that the US government had been tacitly supporting, if not directly developing massive cartel infrastructure in Central America by funding the anti-communist Contra group in Nicaragua. Thousands of tons of cocaine were brought into the American West Coast and South and the money was used not only to attempt the violent overthrow of the Sandinista government—the revolutionary group that liberated Nicaragua from American occupation in the 1930’s—but to introduce the dollar to the entire region.
And while the scandal has dissipated and American influence is no longer visible, the US dollar is now the standard currency for El Salvador and Panama. The dollar is also used in some countries who maintain a currency at a rate fixed to the dollar while it is simply the unofficial, de facto tender in the rest of the region and the cocaine trade has only grown since then.

The routes of the coca trade begin in Pacific South America and find their way north through Central American and the Caribbean before ending up in the narcocapital. The United States has established numerous military bases in Panama—the US used to “own” the Panama Canal—and in Colombia, and these lands bear witness to the growing addiction, exploitation, and profit in Latin American origin countries and destination countries. And though there is no need to reiterate the massive and tragic involvement of the US in Latin American politics in the last century, it is important to see how the former’s laissez-faire capitalism has turned into the aggressive financial take over of the latter.

The money generated by the coca trade does not go to develop the economies of coca producing countries, in fact, it serves as another means to concentrate funds in the hands of the rich. Louis de Bernières stated in his book Señor Vivo and the Coca Lord, “It is estimated that the coca Mafia earns some ten billion dollars perannum. Of this, nine billion apparently finds its way via Switzerland and other countries into investment in legitimate European and United States Industries. The one billion that finds its way back again leaves the country immediately because it is spent on luxury foreign goods destined to embellish the palaces of the caudillos. Unabashed US interest in the international bulk cocaine business has only led to increased desperation in Latin American States, which are slowly transitioning from having a sovereign treasury, to being completely coopted by US narcodollars.

That’s right, nearly every country in the Americas involved in producing, transporting and using cocaine is using the US dollar as a medium for exchange. Michael Melvin and Jerry Ladman have researched the economic structure of coca producing regions in Vol. 23 of the Journal of Money, tracing the rise of the dollarized narcostate, “Since illicit activities like smuggling are financed with currency rather than bank deposits, many people believe that much of the U.S. dollar currency circulating in Bolivia, Colombia, and Peru is earned from illegal drug sales. For instance, in the coca-producing regions of Bolivia, farmers cultivate coca plants to provide leaves from which coca paste is extracted locally and then used as the base for manufacturing cocaine in Bolivia or elsewhere.” This is not a unique case for Bolivia as the region is faced with harsh coca and basuco addiction in the wake of the dollar.

And while the use of adulterated narcotics rises in South America, the abuse rate of cocaine and crack in the United States rises every year. General coca addiction in the US is actually encouraged by the government who has transformed this massive consumer base into an investment pool for the economic subversion of the narcostates of America.

With almost 4 million users, the incentive for foreign producers and manufacturers to supply the US is immense, leading to an entire cultural shift for the hemisphere. Violence from Los Angeles to La Paz is endemic of the coca trade and each of the regions with the most cocaine manufacture and traffic—El Salvador, Panama, Ecuador, Bolivia, Peru, Colombia, numerous Caribbean states, northern Mexican border, to name a few—endure crippling US political influence and overt dollarization.

Latin American cartels, with US support during and after the “War on Drugs,” have establishment well fortified shipping lanes, utilizing planes, submarines, and old fashioned mules to move well concealed cocaine at varying degrees of purity north. The unquantifiably large Pacific Rim coca trade has turned the northern Mexican border into one of the most lawless, violent regions in the world. Here more than ten murders a day are attributed to the intense cartel activity. These well organized, well paid groups are spurred by the availability of arms across the border and the relative economic corruption of the area.

If you’re in Southern California you can test it, the US dollar is valid in the cities of Mexico just south of the border. As in all other opium and coca producing states from Central Asia to Latin America we see the same symptoms of US narcocolonialism—addiction, exploitation, the dollar. There are no efforts to effectively curb hard drug abuse or to curtail the trade, quite the opposite, the US government has supported the drug trade at many levels.

Addiction growing at home, economic desperation abroad, and international confidence in the US dollar continues to grow as it becomes the global currency of so-called illicit business. Having implicated the hegemonic power structure of The United States of America thoroughly, it stands to be said that US citizens are not without guilt. The institutional support for drug use and abuse need not be effective propaganda for the subversion people—they can’t trick us into becoming addicts by subjecting us to domestic oppression. There is yet to be a grassroots movement to combat the devastating global narcotics trade, by either boycotting the drugs entirely or encouraging home production rather than exploitative outsourcing of financially caustic substances.

-Michaël Veremans

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2 Responses to Dollarization and the United Narcostates of America

  1. Piet says:

    It’s no coincidence that countries that produce the most drugs use the dollar. America is not only a melting-pot of people, but of the vices that choke every culture. Leave it to the good ol’ U.S. of A. to make money off the addiction, suffering and death of countless individuals. Brilliant article.

  2. jaguarpress says:

    It’s unfortunate that something that seems to fun and innocent has such a global impact.

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