Everyone today is Halloween. Where we live in Pacifica we probably get 2-3 “trick or treaters.” I think back to Halloween of 1960. I was in 6th grade. My teacher was this short and stocky woman named Mrs. Margaret Hall. She was and is one of the most wonderful positive influences in my life. Aside from being a great teacher and a great person, her biggest claim to fame was that the movie actress Martha Hyer had been one of her students. Mrs. Hall set very high standards for conduct and academic performance. She had not patience with lazy and unproductive people.If a student was observed not working, she would write them up for being “idle.” She would repeatedly remind us that the proper way to pronounce Halloween was Halla’en. I still remember her and that odd pronunciation of Halloween 54 years later. Those of you out there who are teachers, please note, if you are good your students will remember you and love you decades later.
|Akin to Porcupines Mating|
|by Nick Giambruno, Senior Editor | October 29, 2014|
That was how the slow and careful rapprochement between Russia and China has been described by Eric Margolis, one of my favorite geopolitical writers.
US shenanigans in Eastern Europe and the East China Sea—fomenting so-called colored revolutions in Ukraine and Georgia (both on Russia’s periphery) and egging on China’s neighbors to make aggressive territorial claims—have pushed the Russian bear and Chinese dragon together. In May, the two uneasy neighbors reached a de facto alliance represented by a 20-year, $400 billion deal for Russia to supply China with natural gas.
A Russia/China alliance shifts the Earth’s geopolitical axis. Historians may look back at the energy deal as the moment the post-Cold War era and the US’s singular position came to an end. The Russia/China team is now a consequential economic and military counterweight to the US. It will operate as an attractant for every country and every faction that for any reason resents the US’s giant footprint in world affairs.
For example… Russia is making strides in assembling a massive new trading bloc known as the Eurasian Union. When it opens for business on January 1 of next year, Russia, Belarus, and Kazakhstan will be a barrier-free market with 170 million people and a GDP of $2.7 trillion. Armenia, Kyrgyzstan, Tajikistan, and Uzbekistan likely will join in the near future, which would expand the Eurasian Union to 217 million people and a GDP of $2.8 trillion.
In the military and security realm, there’s the Shanghai Cooperation Organization (SCO), an intergovernmental security organization shared by China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan. India, Iran, Mongolia, and Pakistan will join in September 2014.
The two organizations add up to exactly what Zbigniew Brzezinski and other American geostrategists feared the most—the emergence of a power bloc in Eurasia that could stand up to the West.
And it’s certainly not for lack of trying that the US failed in preventing this. It was just outplayed and outmaneuvered at every turn by Vladimir Putin.
Love him or love to hate him, Putin is one smart, tough, ruthless SOB. He’s not the kind of opponent I would want to have. The point of all this should be that regardless of Russia’s troubles at the moment, the country is not going to blow away.
Brzezinski’s concern about an emerging Eurasian power is one of the reasons the US has tried to knock Ukraine out of the Russian orbit. Absorbing Ukraine into NATO would further the goal of isolating Russia, and that is exactly what the US attempted to do—however clumsily.
We’re not referees charged with deciding which political players are good guys and which are bad guys. As potential crisis investors, what we want to know about Russia is its staying power, which we rate as high. The portrait of Putin as a Hitler or a crazy man leading his country toward disaster—the picture you get from the mainstream media and from many politicians—is suitable only for propaganda posters.
As things stand now, the effort appears to have backfired on the US. Putin likely will walk away with de facto control of all the militarily and economically strategic parts of eastern Ukraine, while the US/NATO will end up with the bankrupt western parts—like a Greece on steroids. It seems Russia will emerge from the Ukraine crisis stronger.
In the end, Russia’s economic and geopolitical cooperation with China and other non-Western Eurasian powers means that whatever happens in the West, it has real and arguably more attractive alternatives.
This is exactly why the current negative sentiment and cheap valuations of Russian stocks makes them an excellent speculation. This is just what Doug Casey and I are looking for in Crisis Speculator.
Baron Rothschild may have been an unsavory character in many ways, but he was absolutely correct when he stated that, “The time to buy is when blood is in the streets.”
This statement perfectly captures the essence of speculating in crisis markets.
Huge investment returns have been made throughout history where astute investors took advantage of the semi-hidden opportunities wrapped in an outward cloak of apparent danger in crisis markets.
Doug and I aren’t just blindly running toward disasters. We’re looking for hated markets with cheap valuations that, critically, have an identifiable catalyst. Russia fits the bill perfectly, and that leads us to our latest investment recommendation in Crisis Speculator. It’s a solid Russian company selling at a steep discount and is easily accessible to US investors (and no, it’s not Gazprom).
We believe it will be a profitable financial adventure. If you want to join the party, be sure to check out Crisis Speculator.
Until next time,
Questions or comments? Send them to email@example.com.
|5.5 Million Americans Eye Giving Up US Citizenship, Survey Reveals (Forbes)
73% of Americans abroad are tempted to give up their U.S. passports, reveals a new survey by deVere Group, an independent financial advisory organization. There are an estimated 7.6 million Americans living overseas. At 73%, that’s approximately 5,548,000 Americans weighing handing in U.S. passports.
If all those considering renouncing followed through, it would be the biggest spike ever in renunciations. Already, Federal Register data reveals renunciations spiked by 39% shortly after FATCA—the Foreign Account Tax Compliance Act—came into effect. FATCA is the culprit, says the survey, which is based on 400 expatriates.
73% have considered or are considering renouncing. 16% said they would not consider it, and 11% don’t know. Nigel Green, founder and chief executive of deVere Group, comments: “It is alarming that nearly three quarters of Americans abroad said that they are going to or have thought about giving up their U.S. citizenship.”
“Nationality, especially for an expatriate, is an incredibly important part of one’s identity and typically it’s a very emotional issue too. It is our experience that most Americans are extremely saddened at the prospect of giving up their U.S. citizenship to avoid the harsh implications of a new and utterly flawed tax law,” said Green.
“However, it should come as little surprise that such a high number are prepared to do so because FATCA’s reporting requirements are excessively onerous, burdensome and expensive. Also many non-U.S. banks and other financial institutions will no longer work with Americans which can make living outside the U.S. achingly complicated.”
To address this topic we’ve prepared for International Man readers a free report called The American Expatriation Guide—How to Divorce the US Government. This report will guide you through the process of renunciation in amazing detail. To get a copy, simply log in to the International Man site and then go to the Free Guides & Resources section to download the PDF.
The worst law most Americans have never heard of.
FATCA Envy Spreads Across Hemisphere (Forbes)
The South American nation of Colombia does not have its own version of FATCA, but its government wishes it did. That’s evident from its current tussle with neighbor Panama. The root of the problem between the two nations is FATCA-style reporting of bank data, or the lack thereof. Colombia wants it badly; Panama wants nothing to do with it.
Panama City boasts a thriving financial center, one of the largest in Latin America. Together with the Canal Zone it accounts for most of the country’s GDP. One reason for the Panamanian banking sector’s success is ring-fencing. This policy attracts capital flow from wealthy foreign investors all over the world. Banks in Panama don’t collect information on accounts held by nonresident depositors, so there is no information to share with tax collectors in other countries.[FATCA alters that policy, but only for U.S. accountholders.]
Colombian law requires taxpayers to fully disclose bank deposit income regardless of where it was earned. But If a Colombian taxpayer failed to report his or her income from a Panamanian bank, the tax authorities would be very unlikely to detect the omission because of Panama’s lack of reporting. For practical purposes, the offshore account would remain a secret known only to the bank and the accountholder. Taxable income is thus concealed from Colombia’s revenue body with minimal risk.
Recently, Colombian officials asked their Panamanian counterparts to sign a bilateral tax information exchange agreement, known as a TIEA. The TIEA would have been reciprocal in nature, meaning it would oblige each signatory nation to collect and share bank information about the other nation’s residents. Panama said “no, thanks.” It has little to gain from a TIEA with Colombia.
Colombia retaliated by threatening to tag its northern neighbor with a “tax haven” designation. That legal status would trigger punitive taxes on all money transfers into Panama. It would also inflict reputational damage on Panama’s entire financial system, which could have a chilling effect on foreign investment.
It’s well known that tax laws have unintended consequences. Could one of FATCA’s ripple effects be the inclination of other countries to mimic its outcome? What cash-strapped government wouldn’t seek parallel treatment when its citizens put money offshore, particularly if banks have already implemented mechanisms to gather the relevant data? This may prove to be FATCA’s true legacy. For better or worse, FATCA envy could be here to stay.
Panama responded by threatening to deport Colombian workers, repatriate Colombian criminals from Panamanian jails, and impose travel restrictions on Colombians attempting to enter the country. It’s also considering a 300 percent increase in tariffs on goods imported from Colombia. Panama might also cancel a cross-border electricity sharing agreement.
This is precisely what FATCA was for, to pave the way for a global version (otherwise known as GATCA, more on that here).
How many other Western executives who dare to help Russia bypass sanctions—and turn it into an energy powerhouse—will die under suspicious circumstances?
GATCA Meeting in Berlin (AFP)
The finance ministers of around 50 countries meet in Berlin on Wednesday to sign a deal they hope will put an end to banking secrecy.
The forum, set up under the auspices of the Paris-based Organisation for Economic Cooperation and Development (OECD) and the European Union, brings together representatives of more than 120 countries.
The finance ministers are scheduled to sign on Wednesday a Multilateral Competent Authority Agreement, which will designate which institution in each country is responsible for transferring tax data to other member states.
An international movement to end banking secrecy has gathered momentum in recent years, particularly following the enactment in the United States of its 2010 Foreign Account Tax Compliance Act or FATCA.
GATCA is expected to be up and running in 2018.
Record Number of Americans Renouncing Citizenship Because of Overseas Tax Burdens (ABC)
Frustration over taxes is as American as apple pie, but some U.S. citizens are becoming so overwhelmed by the Internal Revenue Service that they’ve decided to stop being Americans altogether.
There’s also the problem of so-called “accidental Americans,” who were born in the United States but have lived most of their lives in Canada. American tax law mandates that citizens pay U.S. taxes regardless of the country in which they reside, meaning that in the last five years, when the U.S. government started cracking down on foreign tax evaders, many Canadians born in the U.S. realized for the first time that they might owe the IRS back taxes.
Among them was one man who was born in the U.S. but was brought to Canada right after birth, who insisted on anonymity because he is still in the process of renouncing his American citizenship – which he didn’t even realize he had until, on a 2011 trip south of the US-Canada border, he was told he needed an American passport in order to re-enter the United States.
“I don’t break any laws,” he said. “It’s an accident of birth.”
We recently had the chance to speak with one of these “accidental Americans.” It’s a shocking story that you should know about it. Article link is here.
Straws in the Wind
IN CASE YOU MISSED IT…
|“Inflation is the fiscal complement of statism and arbitrary government. It is a cog in the complex of policies and institutions which gradually lead toward totalitarianism.”
~Ludwig von Mises
|Doug Casey’s INTERNATIONAL MAN is a highly actionable service dedicated to making the most of your personal freedom and financial opportunity around the world.
Not a subcriber? Get the International Man Communiqué delivered free to your inbox
This email was sent to firstname.lastname@example.org as part of your subscription to International Man. If you have previously registered to receive this newsletter, but wish to unsubscribe, you can do so by clicking here.
In 1998-1999 I was a male client of a very elite dating agency. I shall mention no names. The high-income ladies paid $5,000 each to meet eligible men. There was such a shortage of over-40 males that my $5,000 fee was waived. I met one wonderful lady who was vice-president of a prestigious investment bank. We hit it off and it looked great except she earned $250,000 per year and I earned less than 20% of that income. The income disparity was “a deal killer.”
The owner also owned another company that specialized in setting up very affluent older men with women in their 20’s looking for “sugar daddies” to care for them. Obviously I was too poor to qualify for this company. But my imagination ran wild thinking about what happened there.
I opened up San Francisco magazine’s latest issue. Lo and behold they had a great article: “I’m Rich You’re Hot The Cold Mathematics of Sugar Daddy Dating.” It’s a great work of journalism and quite enlightening.
Obviously poorer younger women seek to interact with much older and affluent men. The men are looking for beautiful and exciting much younger women. It matters little to them that they have to pay for this companionship.
The women profiled in the article range from upscale sex workers to con women and really broke younger women desperately seeking financial help. According to the article sex did not happen as often that one would imagine.
Now all of my fantasies of long ago have met the hard realities of what really happens.
San Francisco magazine you scored a home run with this article!
My friends and loved ones 66 years ago today I came into this world. I was premature by a month and a half.My survival prospects were not good.
One intrepid young doctor named Harold Ross worked on me all night long and saved my life.
When I would come home to see my mother, she would smile. Then she would bury her face in both of her hands and remain silent for a moment. When she looked up she would always utter the words: “Son it’s a miracle that you’re still alive.”
At this special moment I stop and gives thanks to God for allowing me to stay on this earth for 66 years and to have the wonderful gifts that I have been given. I think about those close to me who did not make it this far including four friends who died in the Vietnam war.
If you were the house right now, I would take you to the dining room. Elena jokes that it looks like an African museum. On the dining table you would find a thick and transparent picture frame. Inside the frame is a $10,000,000 Zimbabwe dollar note. Elena gave it to me as my birthday gift. It’s actual monetary value is $50.00 US, at best.
It is a treasure to me. It symbolizes the special 44-year relationship that I have had with this small and often troubled African country just north of South Africa.
I was first introduced to Zimbabwe when I was an undergraduate at Tulane University in 1970. One of our neighbors in the married student’s dorm was a man named Mutizwa Chirunga. He was older than me and a graduate student. He was an articulate and intelligent man. He spoke English with a beautiful British accent. He would spend hours talking to me about his native country. He taught me much about his culture and values. I began to see how native people in African countries resented the colonialism imposed on them by European countries.
Mutizwa’s wife Jackie gave birth to a son. He was also named Mutizwa. When the little baby had its christening ceremony, my first wife and I were the only Europeans invited to a ceremony attended by Africans living in New Orleans. We were touched and honored.
In 1971 I said goodbye to Mutizwa and Jackie as I left Tulane to go to the US Navy. I never saw him again. I later found out that he had died at age 62 of cancer in 2004.
I never forgot all of his tales of his native country. In September of 1981, I drove across the South African border and found myself in Zimbabwe. It was not as Mutizwa had described it. I saw no jungles. It was all high veld or high plains. I did not see any improvement of the life of the African population after Robert Mugabe had come to power. I drove through the country side and ended up in Harare. It was an educational experience for me. I boarded a flight for Frankfurt,Germany. I did not see Africa again for nine years.
When I returned to live in South Africa, I ran into many people who had fled Zimbabwe to avoid the rule of Robert Mugabwe. I even dated a beautiful woman originally from Zimbabwe.
I left South Africa in December of 1994. My next contact with Zimbabwe was during the time that I was international sales manager for Telewave, Inc. I sold some products to Zimbabwe. Our South African representative, Mike Daykin was also from Zimbabwe. During my time at Telewave l also developed a wonderful friendship with Zimbabwean Mandy Findlater. I also developed a wonderful friendship with Zimbabwean Andrew Field and former Zimbabwe soldier Tim Bax.
Ten years ago I opened a modest brokerage account with a company in Johannesburg, Imara SP Reid. It has been a wonderful business relationship that prospers to this day. It is an investment company started in 1938. It is basically a Zimbabwe company. I have built wonderful relationships at this company including Guy Algeo, Cameron Horsfall, Rajeev Sokur, and Warwick Lucas.
In one of Zimbabwe’s presidential elections, it appeared that Robert Mugabe was going to be voted out of office and replace by Morgan Tsvangarai. Elena and I made a substantial investment in the Zimbabwe stock exchange. Sadly for us, Robert Mugabe won reelection because a third-party candidate had taken votes away from Morgan Tsvangarai.
Hyper inflation racked Zimbawe. At one point our account there was worth tens of billions of Zimbabwe dollars. I would joke with Elena that it was the only time in her life that she was a billionaire.Then the whole market crashed. It appeared for a while that we had lost our entire investment. Then some sanity returned and we recovered 60% of our investment. Our money was sent back to Johannesburg. The skilled investment management of the Imara team recovered our loss.
Zimbabwe eventually gave up on the Zimbabwe dollar as currency. Now all business is done in US dollars and South African Rands.
For the longest time I have wanted one of those big-denomination Zimbabwe dollars. Elena got lucky and found one for me in Sedona, Arizona of all places. A man from Zimbabwe named Gedion Nyanhongo supplied it to her. Elena thank you for a wonderful birthday present that touched my heart. Zimbabwe thank you for being a part of my life for 44 years and making my life richer!
Hi everyone Elena and I are back from Sedona and doing the usual “mad catch up game”after being away. We had a wonderful time and saw a lot of beautiful views of an incredible area. We also enjoyed the wonderful hospitality and friendliness of the people of Sedona, Arizona.
Tomorrow Oscar Pistorius gets sentenced. I would not want to be in the shoes of the judge who must make the fateful decision with the entire world literally looking over her shoulder.
I have observed law around the world for over 40 years. After a while, one sees that throughout the world there is a market value for sentences for various crimes (With the exception of some states that still use the death penalty and others that have abolished it.)
In the case of manslaughter, the sentence virtually anywhere in the world can range from probation to a mid-range of two years up to four years on the top end. Look for a final outcome somewhere in that range.
This case has been a tragedy for all concerned. I’m glad that it’s coming to an end.
I have a wonderful book dealer in South Africa. Over the years he has provided us with incredible books. Yesterday he sent us a book on Mount Kilamanjaro in Africa. This peak is 19,000 feet tall. But it is a gentle climb and not as dangerous and deadly as mountains like Mount Everest. Elena has considered this climb for a long time. I asked her to read the book. I have been “out of Africa” for almost 20 years. It’s time to return. I will take Elena to climb this mountain in 2015!
My friends I still keep the very old-fashioned AT&T land line plugged into the wall. It costs an extra $35.00 per month. Both Elena and Luah object to this expense as a waste.
I remind them of a bad storm or typhoon (hurricane for you people in the south and east coast.) Power was down for more than a day. Most disturbing is that the cell phone towers went off line without power. (There is a lot of pressure to put back-up generators in each cell phone tower just as hospitals have back-up generators. The cell phone companies resist making this large expense.)
The best line from the 1979 movie Alien was as follows:
“In space no one can hear you scream.”
If a big storm or earthquake hits and you are out of power for days, how do you call for help if someone is severely injured, having a heart attack or a stroke, etc.?
If you’re one of the few people like me with a satellite phone,you might be able to make a call if you still have power in your battery and the sky is clear enough to pick up a satellite. Your only other option is the good old-fashioned land line not so heavily dependent on electric power.
My AT&T land line developed problems. A great tech named John Lee came out yesterday. He replaced the phone jack and a defective cord to the fax machine. Now our emergency life line in back “on line.”
My dear friends and readers in September of 1996 I truly was a starving author. I had done extensive research on a former Mossad agent who became a notorious international drug dealer. Evidence that I had obtained from a disgraced CIA covert operations specialists with the code name William Clay and a disgruntled former Mossad agent living in Toronto confirmed the claims of the international drug dealer who admitted to be on the payroll of both the CIA and the DEA.
I knew that Gary Webb had written several newspaper stories on CIA involvement in drug dealing. I used my last $200 to buy a bus ticket from Houston, Texas to San Jose, California. I wanted to share my information with Gary Webb.
After a long two-day ride I arrived in San Jose, California The following day I arrived at the San Jose News Mercury. I asked to see Gary Webb. I was told that he was doing a radio show in Sacramento, California and no longer there. I was given a”a big run around.” I did not get to talk to Gary Webb then.
I later found out that he had been disgraced and discredited for having the courage to write about the taboo subject of CIA involvement in drug dealing. He would have had no power to help me or to use my information.
I went on to get the biography of this Mossad agent published by a courageous woman publisher who ignored threats of lawsuits and government investigations. Some of you have read my book Laguna.
Ironically Gary Webb and I became close personal friends later. I even had his home phone number. I was heart broken when he took his own life in 2004 in Sacramento in 2004. In his mind he died a disgraced and a broken man who had lost his career and his family.
I got a great personal surprise yesterday when I saw the article below in the New York Times. A new movie premiers on 10 October. It’s title is Kill The Messenger. The movie vindicates Gary (and my research also). It confirms that the CIA “turned a blind eye” to drug dealing by its agents and contractors. The CIA even used the money from drug dealing to fund covert operations.
Resurrecting a Disgraced Reporter
‘Kill the Messenger’ Recalls a Reporter Wrongly Disgraced
By DAVID CARROCT. 2, 2014
Jeremy Renner as the San Jose Mercury News reporter Gary Webb in “Kill the Messenger.” Credit Chuck Zlotnick/Focus Features
Continue reading the main storyShare This Page
If someone told you today that there was strong evidence that the Central Intelligence Agency once turned a blind eye to accusations of drug dealing by operatives it worked with, it might ring some distant, skeptical bell. Did that really happen?
That really happened. As part of their insurgency against the Sandinista government in Nicaragua, some of the C.I.A.-backed contras made money through drug smuggling, transgressions noted in a little-noticed 1988 Senate subcommittee report.
Gary Webb, a journalist at The San Jose Mercury News, thought it was a far-fetched story to begin with, but in 1995 and 1996, he dug in and produced a deeply reported and deeply flawed three-part series called “Dark Alliance.”
That groundbreaking series was among the first to blow up on the nascent web, and he was initially celebrated, then investigated and finally discredited. Pushed out of journalism in disgrace, he committed suicide in 2004. “Kill the Messenger,” a movie starring Jeremy Renner due Oct. 10, examines how much of the story he told was true and what happened after he wrote it. “Kill the Messenger” decidedly remains in Mr. Webb’s corner, perhaps because most of the rest of the world was against him while he was alive. Rival newspapers blew holes in his story, government officials derided him as a nut case and his own newspaper, after initially basking in the scoop, threw him under a bus. Mr. Webb was open to attack in part because of the lurid presentation of the story and his willingness to draw causality based on very thin sourcing and evidence. He wrote past what he knew, but the movie suggests that he told a truth others were unwilling to. Sometimes, when David takes on Goliath, David is the one who ends up getting defeated.
The real Gary Webb in 1997. He committed suicide in 2004. Credit Randy Pench
“There were flaws in his writing and flaws in his life,” Mr. Renner, who plays Webb in the film, said in a phone interview. “But that doesn’t mean he was wrong, and it certainly doesn’t mean he deserved what he got.”
The film argues that the same reflexes in the newspaper business that hold others to account can become just as merciless when the guns are pointed inside the corral. Big news organization like The Los Angeles Times, The New York Times and The Washington Post tore the arms and legs off his work. Despite suggestions that their zeal was driven by professional jealousy, some of the journalists who re-reported the story said they had little choice, given the deep flaws. Tim Golden in The New York Times and others wrote that Mr. Webb overestimated his subjects’ ties to the contras as well as the amount of drugs sold and money that actually went to finance the war in Nicaragua.
But Mr. Webb had many supporters who suggested that he was right in the main. In retrospect, his broader suggestion that the C.I.A. knew or should have known that some of its allies were accused of being in the drug business remains unchallenged. The government’s casting of a blind eye while also fighting a war on drugs remains a shadowy part of American history.
Continue reading the main story
Mr. Webb eventually wrote his own book, “Dark Alliance: The C.I.A., The Contras and the Crack Cocaine Explosion,” and Nick Schou, a journalist who covered significant parts of Webb’s downfall, wrote “Kill the Messenger: How the C.I.A.’s Crack Cocaine Controversy Destroyed Journalist Gary Webb.” Both books deeply inform the movie, making the argument that journalism more or less ate itself while the government mostly skipped away with its secret doings intact.
Mr. Webb was a talented investigative reporter who concentrated on local corruption when he worked at The Cleveland Plain Dealer and then The San Jose Mercury News. When he was first approached about C.I.A. duplicity, he was deeply skeptical. But when the tipster, the girlfriend of a drug dealer on trial, said her boyfriend had ties to the C.I.A., she had enough evidence to convince him to read that 1988 report from a special Senate subcommittee documenting instances in which drug dealing by crucial allies, including some in Nicaragua, was tolerated in the name of national security. Major news outlets gave scant attention to the report.
Mr. Webb was not the first journalist to come across what seemed more like an airport thriller novel. Way back in December 1985, The Associated Press reported that three contra groups had “engaged in cocaine trafficking, in part to help finance their war against Nicaragua.” In 1986, The San Francisco Examiner ran a large exposé covering similar terrain. Again, major news outlets mostly gave the issue a pass.
It was only when Mr. Webb, writing 10 years later, tried to tie cocaine imports from people connected to the contras to the domestic crisis of crack cocaine in large cities, particularly Los Angeles, that the story took off. Mr. Webb zeroed in on “Freeway” Ricky Ross, a gang-affiliated drug boss in Los Angeles, who flooded streets with crack. He then drew a line from Mr. Ross to the C.I.A.-backed contras, writing, “The cash Ross paid for the cocaine, court records show, was then used to buy weapons and equipment for a guerrilla army named the Fuerza Democrática Nicaragüense,” or the FDN, one of several contra groups.
The headline, graphic and summary language of “Dark Alliance” was lurid and overheated, showing a photo of a crack-pipe smoker embedded in the seal of the C.I.A. The three-part series would, the summary promised, reveal, among other things, how “a drug network opened the first pipeline between Colombia’s cocaine cartels and the black neighborhoods of Los Angeles, a city now known as the ‘crack’ capital of the world.”
But if the series was oversold, it certainly delivered on the promise of what the web could do for journalism. A pioneering effort in transparency, the report was accompanied by a digital library of source documents, a timeline of events and a list of characters, among other web-only features that have now become commonplace. It was, by most accounts, the first newspaper series to go viral before there were even words to describe the phenomenon.
Continue reading the main storyContinue reading the main storyContinue reading the main story
At first, major news outlets shrugged. But leaders of the drug-ridden communities did not, drawing a line that Mr. Webb had not by suggesting that the C.I.A. had deliberately set out to addict urban black populations.
Representative Maxine Waters, Democrat of California, led protests by the Congressional Black Caucus, and the comedian Dick Gregory was arrested after trying to put crime tape at the entrance to the C.I.A. headquarters.
But Mr. Webb’s victory lap was short lived, as other news organizations responded with significant stories, and his editors at The Mercury News backed away slowly, then all at once. The paper walked back the findings in a 1997 letter to readers signed by the executive editor at the time, Jerry Ceppos. “I feel that we did not have proof that top C.I.A. officials knew of the relationship” between members of a drug ring and contra leaders paid by the C.I.A., he wrote, adding that the series “erroneously implied” that the connection between Mr. Ross and Nicaraguan traffickers “was the pivotal force in the crack epidemic in the United States.”
In a phone call, Mr. Ceppos said good news organizations should hold themselves accountable to the same degree they do others.
“We re-reported the series, and I don’t know of too many publications that have done that,” he said. “We couldn’t support some of the statements that had been made. It was our re-reporting that influenced me the most.”
He added that he had no regrets about that open letter to Mercury readers.
“I would do exactly the same thing 18 years later that I did then, and that is to say that I think we overreached,” he said.
Peter Landesman, an investigative journalist who wrote the screenplay, was struck by the reflex to go after Mr. Webb.
“Planeloads of weapons were sent south from the U.S., and everyone knows that those planes didn’t come back empty, but the C.I.A. made sure that they never knew for sure what was in those planes,” he said. “But instead of going after that, they went after Webb, who didn’t really know what he had gotten into or where he was. The most surprising thing in doing the work to write this movie is how easy it was to destroy Gary Webb.”
Even at the time, some thought the backlash against Mr. Webb was misplaced.
Geneva Overholser, then the ombudsman of The Washington Post, wrote that the newspaper “showed more passion for sniffing out the flaws in San Jose’s answer than for sniffing out a better answer themselves.”
Mr. Golden, who had an extensive background covering the C.I.A. and Central America, said the hand that struck Mr. Webb was mostly his own.
“Webb made some big allegations that he didn’t back up, and then the story just exploded, especially in California,” he said in an email. “You can find some fault with the follow-up stories, but mostly what they did was to show what Webb got wrong.”
The director of “Kill the Messenger,” Michael Cuesta, has also directed several episodes of “Homeland” and knows the C.I.A. has many faces. He said he worked to shrink a sprawling story with global dimensions by showing how it landed on one man.
“There were many things that went wrong,” he added, “the packaging of the story, how it was received and grew, the fact that he was not backed up by his editors. But I was struck by the fact that journalism, which had been the source of his purpose, his bliss, turned on him. It’s tragic.”
While Mr. Webb died alone, after two self-inflicted gunshots, he lived long enough to know that he did not make the whole thing up.
In 1998, Frederick P. Hitz, the C.I.A. inspector general, testified before the House Intelligence Committee that after looking into the matter at length, he believed the C.I.A. was a bystander — or worse — in the war on drugs.
“Let me be frank about what we are finding,” he said. “There are instances where C.I.A. did not, in an expeditious or consistent fashion, cut off relationships with individuals supporting the contra program who were alleged to have engaged in drug-trafficking activity, or take action to resolve the allegations.”
However dark or extensive, the alliance Mr. Webb wrote about was a real one.