‘Smuggler Nation’

03.07.13

Bootleg Empire: America the Smuggler Nation

America managed to get ahead thanks to illegal trade, but today it is the inspector general against countries like China. Cam Martin on a new book that highlights the hypocrisy.

The United States of America is the world’s most feared policeman against the smuggling of drugs, immigrants, intellectual property, and other illicitly trafficked items. This is an interesting and relatively recent development.

In the 18th and 19th centuries, American companies commonly stole intellectual property from countries such as Britain, and this helped fuel the stateside industrial revolution. In defiance of British law, British artisans smuggled themselves into the U.S. to operate machinery that had been designed in England. American publishers boldly disregarded copyright laws and reprinted the works of popular British novelists, including Charles Dickens.

This is the hypocrisy examined at the heart of Smuggler Nation: How Illicit Trade Made America. The book’s author, Peter Andreas, notes that as a young and newly industrialized nation, America “aggressively engaged in the kind of intellectual property theft it now insists other countries prohibit and crack down on.” Today America’s policy is that China should do as we say, not as we did. The Chinese making money off bootlegged versions of Lincoln is most definitely not acceptable.

Shifting geopolitical balance of power and societal mores dictate what goods get policed and to what extremes and who will make a profit off the prices set by existing markets. Cocaine was once less expensive and less potent. Heck, it was once legal. But the war on drugs drove up the cost of doing business, and the profit margin for smugglers and the yield corrupt officials could hope to earn also rose. Cocaine, alcohol, and human labor are just a few of the “goods” that have a storied history of being smuggled into and out of the U.S. in huge quantities.

In Colonial times, smuggling was not only widely practiced by respectable merchants, likely including John Hancock, Robert Morris, and other Founding Fathers, but it was systemically endorsed by the community at large.

How storied is it? Andreas, as a political-science professor at Brown University, knows all too well that one of the Ivy League institution’s founders was John Brown, the first American to be tried and convicted under the Slave Trade Act of 1794, which prohibited the building, loading, or use of any ship for the slave trade. How paradoxical that the human trafficking he condoned and furthered brought to America the ancestors of future Brown University president Ruth Simmons, the first African-American president of an Ivy League school, who created a steering committee to examine the university’s early links to slave trafficking.

But the “storied” history goes back even further. John Hancock, whose huge signature dominates the Declaration of Independence, was one of the most public denouncers of the British crackdown on smuggling. His direct involvement in illicit trade remains unclear, but when his ship the Liberty was seized in 1786 by British customs officers after they discovered it had more cargo than declared, Hancock and his alleged collaborators were put on trial. “But their legal case proved to be thin—so much so that in the end it was simply dropped,” Andreas writes. “Hancock was hailed as a hero throughout the colonies. For the British, the affair was a total fiasco.” Historian Thomas Barrow said that Hancock and his ship “had commenced a series of events leading to open revolution.”

Andreas deftly explains how the battle lines of the American War of Independence were drawn largely because of people’s varied and often self-serving relationships to smuggling. Nowadays the word “smuggling” has a decidedly negative connotation, as it’s largely associated with drugs or other contraband. But in Colonial times, smuggling was widely practiced by respectable merchants, including possibly Hancock, Robert Morris, and other Founding Fathers, and it was systemically endorsed by the community at large. Smuggling is business, “a clandestine economic practice that we can simply define as bringing in or taking out from one jurisdiction to another without authorization,” Andreas writes. “Smuggling was so institutionalized in the Boston merchant community that merchants were able to buy insurance policies to cover them in the event of seizure.”

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“Smuggler Nation: How Illicit Trade Made America” By Peter Andreas. $30; Oxford University Press; 472 pages. ()

For a long time the British were relatively lax in their customs enforcement. But when the need to raise revenue arose, they decided to crack down, with unforeseen consequences. “The standard, familiar narrative of the roots of the American Revolution is that it was about defending freedom and protesting taxes,” Andreas notes. “But a too-often-overlooked aspect of this was the freedom to evade taxes in the form of smuggling.”

When war broke out, a troubling dynamic emerged as combatants willingly traded across enemy lines. Self-interest trumped patriotism, contributing to the length of the war. It’s a construct that has repeated itself in numerous subsequent wars. The War of 1812: “a stalemate that dragged on for two and a half years, with British forces kept well fed and supplied with the help of American smugglers pursuing illicit profits over patriotism.” The Civil War: “smugglers contributed to this heavy human toll by arming Confederate forces and thus enabling the war to drag on much longer than would otherwise have been possible.”

But peace can be just as profitable as war. The Gilded Age was marked by the widespread smuggling of silk dresses and other consumer wants. Prior to the ratification of the federal income tax in 1913, the U.S. government raised most of its money through tariffs and customs, which companies and individuals strove to circumvent. “Americans from all walks of life enjoyed finding a good bargain,” Andreas writes of the freedom to buy and sell. “Evading the tariff could mean a deep discount.”

In war and in peace, inevitable, self-perpetuating economies arise around the smuggling of illicit goods. The construct is simple and repeated everywhere: a desire for illegal or taxable goods plus the attempt to enforce the law equals a spike in prices, smugglers willing to risk prosecution to obtain wealth, and corrupt officials being paid off with exorbitant bribes. “The speed, content, methods, and organization of smuggling have varied greatly across time and place,” Andreas writes. But “the basic activity itself has not fundamentally changed.” Smugglers still most often go straight through law enforcement, via corruption.

In the 1970s and ’80s, cocaine flooded into the U.S. through Florida. When law enforcement focused on cutting off the flow, smugglers shifted their routes to Mexico, and cocaine seeped through the long, porous border. The government hired more Border Patrol agents, and they were in turn exposed to more corruption. It’s a push-down, pop-up system, and something of the American way. The history of the world has been molded by humans’ desire for specific products. This is certainly true for average supermarket products like salt, cod, and fruit, and it’s just as true for human trafficking and drugs. Smuggling is here to stay, and how we cope with this most American of practices will define our destiny in the years to come.