Albania–Is there a lesson?
By Ed Henry
A small nation of 3 million people, Albania is more than the propaganda story fashioned in the movie Wag The Dog. This is a movie that portrays and spoofs the American way of bringing us the news, running elections and creating diversions.
Albania is a real countrya mountainous mining country in the Balkans, bordering the former Yugoslavia. As such, this small nation was right at the heart of all the trouble in Bosnia-Hertzegovina we experienced a few years ago. You remember all the ethnic cleansing news and bombing raids against the Serbs.
Well, it turns out that almost everyone in Albania fled the country by the revolution in 1997. And the reason they left was that hundreds of thousands had lost everything they owned in Ponzi schemes sponsored and condoned by their government.
In bordering countries like Bosnia, this migration caused tremendous problems, particularly, since these neighbors were themselves rebuilding after the Russians pulled out in the early nineties. At the end of the Cold War, America borrowed itself into monstrous debt to win.
It also caused problems in older, established nations like Italy and Greece until Albanians were absolutely stopped at the border. It wasnt that easy for countries like Bosnia and more contiguous neighbors not that well organized.
In America, you didnt hear much about this problem. It wasnt one of CNNs mega-stories. And theres a reason it wasnt given much attention by the loyal Clintonista media. Theres a reason why we may have been given the ethnic cleansing story instead, a play on an old religious fight that had been going on since the Ottoman Empire. Half truths are very useful on such occasions.
The American story
Many extreme right-wing Americans, those at the opposite of welfare, believe that Social Security is a Ponzi scheme, that Social Security not only depends on more people paying in than receiving benefits, but that its unfair to the payees. They believe that the people paying now will not get the same shake when they retire.
Theres a tendency for older people to label anything that seems like a con game or rip-off as a Ponzi scheme simply because of the dramatic impact Charles Ponzi had on the country when he bilked so many Bostonians out of millions during the twenties. Theyve heard their parents talk about Ponzi.
Charles Ponzi invented the pyramid scheme, or what was later also translated into chain letters and telephone trees. Its been put to many uses, most of them cons, but some good.
What pyramids depend on is the number of tiers and blocks of people under the apex, the person who started building. You start with getting any number of people to join the first tier, then having them each get just as many people for the second tier who do the same thing, and so on and so on. People in the lower tiers feed money, letters, pot-holders or whatever back-up until those at the top are raking it in hand over fist, each tier taking its percentage on the way, of course.
The trouble with Ponzi schemes or pyramiding this way is that they usually collapse by the fifth or sixth tier, if they even get that far. Everybody gets wise, or the system simply collapses in on itself from its own cumbersome weight and confusion.
In other words, if Social Security were truly a Ponzi scheme, it would have collapsed somewhere in the forties. It would have been freak luck to make it into the fifties, more than 10 years after going into effect. It certainly wouldnt be around today.
But this was exactly what had been going on in Albania since the new democratic government took over in the early nineties. Get-rich-quick pyramid schemes were all over the place with the government apparently right in the thick of it. By 1997, those still left in the country revolted and overthrew the government.
For all I know, maybe it was some older right-wing mining engineers who went over there and put ideas in peoples heads, saying, Hey, weve got 40 million Americans living off a Ponzi scheme. You should try it.
There was a point where Secretary of State Mad Albright considered sending NATO troops in to protect American citizens caught in the 1997 uprising.
In short, the powers that be certainly didnt need to add fuel to the fire in America by pointing out what happened in Albania. With its own much more sophisticated rip-off well underway and about to open a money laundering scheme to pay down the national debt, the American spin doctors put Albania away in the closet. They may have even supported a laugh-at-yourself funny movie to make people believe Albania was a fairy tale.