Money Talks: The Business of Black Markets

Summary

Slate Money: Money Talks – The Business of Black Markets

Date: February 17, 2026
Host: Felix Salmon
Guest: Mariana Van Zeller (Host of Nat Geo’s Trafficked and the podcast The Hidden Third)

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Episode Overview

This episode of Slate Money dives into the complex and hidden world of black and gray markets, featuring veteran investigative journalist Mariana Van Zeller. The conversation explores the scale, dynamics, and surprising normalcy of the underground economy—estimated to make up about a third of global economic activity—as well as its embeddedness in both developing and wealthy nations. The episode unpacks the incentives, business parallels, risks, and human stories driving these markets, and grapples with the systemic issues, such as corruption and inequality, that perpetuate their existence.

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Key Discussion Points & Insights

The Scale and Scope of Black Markets

• Definition and Size:
  • Van Zeller explains the “hidden third” refers to the estimated 30–35% of the global economy that operates in black and gray markets—including drugs, guns, untaxed commerce, and informal labor.

    “It's estimated 35% of the global economy are black and gray markets, and yet we know very little about them.” – Van Zeller [00:36]

• Global vs. U.S. Context:
  • Felix assumes the U.S. has a relatively small black market due to its wealth and institutions, but Van Zeller dispels this:

    “No, I mean, we're the number one consumer of drugs in the world. Our drug business here in the United States alone brings in $150 billion a year.” – Van Zeller [05:10]

The Parallels Between Legal and Illegal Markets

• Operational Similarities:
  • Illegal organizations, like drug cartels and immigrant smuggling operations (“King Coyote”), mimic legitimate businesses with marketing, legal advice, and HR departments.

    “These are businesses that we tend to think as, you know, small and underground… but if you look at them, they operate... very parallel to the legal economy.” – Van Zeller [05:45]

  • Use of social media and messaging apps (e.g., WhatsApp) for marketing, relying on word-of-mouth and success stories to build “brand reputation.” [07:11]
• Employee Management:
  • HR is critical even in criminal organizations—retaining employees is based on trust and reputation instead of legal contracts, and employee/client satisfaction ensures survival.

    “If you're not treating well your employees, there's a high risk. Trust is incredibly important because there are no court systems...” – Van Zeller [13:39]

Why People Work in Black Markets

• Lack of Opportunity:
  • Most people in black markets aren't inherently criminal; they are driven by circumstances, family ties, and scarcity of legal alternatives:

    “I've interviewed, you know, dozens of people... who started selling drugs or became sicarios or became scammers because of lack of opportunities.” – Van Zeller [09:10]

• Occasional Entrepreneurship:
  • Some, like the sports bookie in the Shohei Ohtani scandal, are drawn to the business by choice, preferring the thrill or profit over legal alternatives. [14:50]

The Incentive Structure & Risks

• Compensation vs. Risk:
  • Riskier activities yield higher rewards, reminiscent of legal markets. Gambling, even when legal, has an illicit sector because people want privacy, higher earnings, or tax evasion.

    “The higher the risk, the more generally you are paid. I mean, particularly in the world of black markets...” – Van Zeller [10:43]

• Quality Control Issues:
  • Black markets can fill unmet legal needs (e.g., cheaper medicines for uninsured Americans), but without safety regulation, they’re dangerous. Cartels can infiltrate even legitimate pharmaceutical channels.

    “A lot of the pharmaceuticals being made in Mexico are actually made by the cartel… there's little quality control and it can end in, you know, a lot of harm, sometimes death.” – Van Zeller [11:28]

• Laundering and Asset Management:
  • Laundering money from illegal markets remains difficult; solutions range from basic (stashing cash in tires) to complex (networks of debt and counterbalancing informal IOUs). [15:33]
  • Cartels keep U.S. distributors perpetually indebted, ensuring ongoing cooperation.

    “You keep somebody on the hook… always offering him more product than he is able to pay for.” – Van Zeller [17:17]

The Role and Scale of Violence and Corruption

• Corruption as an Enabler:
  • Corruption is the “multiplier” for organized crime. Black markets thrive where law enforcement and civil servants are poorly paid and susceptible to bribery. [26:11]
  • Smuggling (e.g., fentanyl) largely occurs through legal ports of entry, facilitated by complicit officials, not unnoticed traffic across remote borders. [26:11]
• Varied Risk Perception:
  • Personal danger in black markets is proportional to activity—small-scale gamblers face minimal jail risk, but traffickers or scammers must remain vigilant. Many remain anonymous even during interviews due to fear of exposure. [21:29]

Why Black Market Operators Talk to Journalists

• Motivations:
  • Ego—wanting recognition for their skills;
  • Impunity in corrupt environments;
  • A desire to be understood as people, not just criminals.

    “A very human characteristic that we all share of wanting to be understood.” – Van Zeller [22:24]

International Perspectives: China, Myanmar, and Beyond

• Chinese Money Laundering Networks:
  • Chinese operators have become global leaders in laundering for black markets due to high demand for dollars and low fees.

    “These operations with Chinese folks ready to launder your money… it's become much easier. They take a much smaller share and that they're everywhere.” – Van Zeller [29:22]

• Myanmar Scam Cities:
  • Massive scam compounds run with total impunity, often employing forced labor—workers’ passports seized, subjected to torture for compliance. [23:55]
• Corruption Crackdowns:
  • Examples from China and Indonesia are referenced to highlight that some countries have managed to curb corruption with stricter reforms and better civil servant pay. [27:25–28:23]

The Fundamental Issue: Inequality and Systemic Breakdown

• Humanizing the “Criminals”:
  • Van Zeller’s reporting underscores that most are driven by necessity and circumstance, not inherently criminal motives.

    “It’s the systems that are broken. It’s not so much human beings… knowing that even when I'm meeting face to face these sicarios and traffickers and scammers, that they can still find humanity and that there is still redemption possible there.” – Van Zeller [30:33]

• Inequality as the Root Cause:
  • Both agree that persistent, rising inequality will perpetuate black markets:

    “Half of the world's population with less than $7 a day and that's just unattainable. As long as there's inequality, there's going to be violence.” – Van Zeller [32:11]

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Notable Quotes & Moments

• On market size:

  “It's estimated 35% of the global economy are black and gray markets, and yet we know very little about them.” — Mariana Van Zeller [00:36]

• On the scale in the U.S.:

  “We're the number one consumer of drugs in the world… $150 billion a year.” — Van Zeller [05:10]

• On incentives and entrepreneurship:

  “Most of what has shocked me… has been the talent and the entrepreneurship and the creativity behind many of people, these black market operators.” — Van Zeller [09:01]

• On risk and pay:

  “The higher the risk, and that's very similar with the legal economy as well. The higher the risk, the more generally you are paid.” — Van Zeller [10:43]

• On corruption’s role:

  “Corruption has fully seeped in into the United States … every single interview I did pointed to corruption as being the multiplier.” — Van Zeller [25:13]

• On why interview subjects talk:

  “It's ego… impunity… and wanting to be understood.” — Van Zeller [22:24]

• On inequality:

  “Biggest problem of our time, I really believe, is inequality. We have half of the world's population with less than $7 a day … As long as there's inequality, there's going to be violence.” — Van Zeller [32:11]

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Important Timestamps

• Defining the "hidden third" and scope of black markets: [00:36–03:58]
• American black markets and how they function: [05:10–08:25]
• Human stories and why people enter black markets: [09:01–10:10]
• Risk-reward, illegal pharmaceuticals, gambling: [10:43–12:15]
• Organization/HR in criminal enterprises: [13:16–15:52]
• Handling and laundering money: [15:33–18:05]
• Risk awareness among operators: [21:09–22:19]
• Motivations for talking to journalists: [22:22–23:39]
• International case studies and impunity: [23:55–24:51]
• Corruption’s multiplier effect: [25:13–26:11]
• Systemic causes and inequality: [31:48–32:28]

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Conclusion

This episode offers an unvarnished look at the economic realities and personal stories behind black and gray markets. It underscores that the problem is not simply criminal intent—but a web of broken incentives, inequality, and corruption that gives rise to a vast underground economy, intimately connected to and reflective of the legal world above.

Listen to Mariana Van Zeller’s podcast The Hidden Third for deeper dives into these topics.

Transcript

[A]

Hello.

[B]

Welcome to Money Talks from Slate Money. I'm Felix Salmon of Bloomberg, and this is the show where we talk to the most interesting people in the world about the most interesting subjects in the world. And this week I am reunited with my former colleague, Mariana Van Zeller. Mariana, welcome.

[A]

Thank you, Felix. I'm happy to be here.

[B]

Mariana, tell us, who are you, what do you do, and most importantly, what is your podcast?

[A]

I have been covering black markets for about 20 years now. I have a show on National Geographic called Trafficked with Mariana Van Zeller. And I recently launched a podcast called the Hidden Third. It's called the Hidden Third because it's estimated 35% of the global economy are black and gray markets, and yet we know very little about them.

[B]

I love this so much. So we are going to dive into exactly that. We're going to try and work out what is black market, what are the incentives, what is the same as a normal market, where do things go very, very different? You've been covering this, as you say, for decades now, so you are the expert on this and there aren't that many experts on this. So I'm very excited about this. It's all coming up on Money Talks.

[C]

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[B]

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[A]

Not so much about the expenditure, it's more about the market share. I mean, when we talk about black markets, we're essentially talking about drugs and guns and illegal products. But we're also talking about gray markets, which is, you know, the man selling fruit on the side of the street. The product that you're selling online and is not taxed. So these are tax revenue that you're not getting and that ultimately is not being used to pay for better schools and hospitals and infrastructure and all that. And it's in that sense that economists estimate that it's around 30, 35% of the global economy.

[B]

If I'm just paying cash for something, there's a decent chance that that counts as like gray market.

[A]

Yeah, it's a gray market because it's untaxed. Right, but you're saying how you are not the person buying these drugs or these illegal or, you know, taking part in this black market. Even if you discount the gr, the black markets alone, these affect every single one of us. You might not see it every day, but whether you're talking about drugs, which is, you know, estimated to be between 300 and 600 billion dollars a year, or scams, we all know people who've been affected by scams and victimized by scams, illegal immigration, I mean, these are all subject matters that, you know, are on our headlines every day that have a huge impact on our lives. And again, I think we know very little about them. So.

[B]

So let me first start with where most of the Slate money audience is, which is the United States, which is, you know, a very rich country with relatively well developed civil institutions and rule of law and that kind of stuff. Would it be fair to say that the black and gray markets are smaller than in the US Than they are globally, or not so much?

[A]

No, I mean, we're the number one consumer of drugs in the world. Our drug business here in the United States alone brings in $150 billion a year. Again, I've spent time with the cartel, with the Sinaloa cartel in Mexico and with sort of coyote operations, a guy called the King Coyote, bringing in immigrants to the United States and these are two operations that are very different, but that essentially operate very much like the legal economy. Like actual legal businesses, they depend on marketing. For example, I will never forget the interview we did with King Coyote where he was talking about how he gains new clients, people wanting to come to the United States by marketing the work that he does. And he has lawyers in the United States. He has a human resources department. I mean, these are businesses that we tend to think as, you know, small and underground and hidden in the deepest corners of our world, but that if you look at them, they operate. They're very parallel to the legal economy.

[B]

The lawyers in the United States who work for, are they breaking the law? I feel like one of the things that lawyers do is they represent criminals. You have to be able to do that. Are they doing anything elicit?

[A]

Not exactly. They're looking at examining what is changing on a federal level, what is changing on a state level in terms of immigration laws, and how they can exploit the system, how they can exploit the loopholes to give advice to their clients, to the King Coyote on how to bring people across the border. And the same happens with cartels. Cartels in Mexico. I've spoken to several who've talked about hiring people, hiring lawyers in the United States for the exact same purposes, and experts. And obviously we haven't even spoken about corruption and what a big part that plays. But in trying to figure out how they can get their product across to the United States.

[B]

And like the marketing campaigns, what are they using? Some kind of social media, something?

[A]

Yeah, it's so interesting because it's something that I never heard before I interviewed King Coyote. But what they do is his company, and they were bringing thousands of people across from Southern Mexico all the way to northern Mexico and into the United States. And what they're doing, what he did was that he would send out WhatsApp messages with sort of his success rate and how many people he made, he managed to get across. And then putting out this price point, and he says it's all word of mouth. Most of the marketing campaigns, you know, it's not billboards outside or podcast ads, but it's word of mouth. If you give people a good, you know, enjoyable experience, they're likely to share that contact to other people and other people want to use that service.

[B]

I feel like this is a big opportunity for Slate Money. We should just be selling podcast ads to criminals, because that's not illegal, right? Like, we would be allowed to do that. And this is the third of the global economy. Like, there's money here.

[A]

I'm not sure if they'd like all that attention. But yeah, you know, traffic, where basically I get access to these hidden worlds around the world. You know, it's an expensive show to put together and many times we've thought that we should actually be involved in those black markets. So we've been paying for this expensive show.

[B]

Seriously, like you've been covering these markets for a long time. They are a massive part of the global economy. Obviously there is a lot of demand for these services. How often do you find yourself thinking this is a really good product or service? You know, I would quite like to avail myself of it if it wasn't illegal.

[A]

It's not so much about the product. So I don't think I would. You know, I've been to Fentanyl labs in Sinaloa and I've seen they put out some pretty pure products, but that's not the kind of stuff that I'm interested in buying.

[B]

That's contraindicated. I wouldn't, I wouldn't start like failing yourself if that one.

[A]

Or counterfeit money. I've spent time in Peru with a counterfeit money group of people that basically make $100 bills that look exactly like the real ones. Those I'd probably be more likely to bring back. But I think, I think most of what has shocked me in my decades of working black markets has been the talent and the entrepreneurship and the creativity behind many of people, these black market operators. And for the vast majority of people I speak to, they're involved in these worlds of crime not because they, you know, were born thinking, oh, that's what I want to be. I want to be a fentanyl chemist or a drug trafficker or a coyote. It's because of the environments they grow up in. You know, if you grow up in Sinaloa and you're. Your whole family is part of the cartel, it's very likely you're going to be end up being part of the cartel or for lack of opportunities. I've interviewed, you know, dozens of people, if not hundreds, who sort of entered, who started selling drugs or became sicarios or became scammers because of lack of opportunities. And as long as we don't talk about the incentive, it's going to be very hard to change the outcome. And that's what's missing usually in the conversation about these black markets.

[B]

In a normal legitimate market, I get a creative job as, let's say I'm a designer of fake handbag or $100 bill or even a pharmaceutical product. And this is a skilled job and I get paid a wage for it and I pay my taxes on it. Tell me about like on the one hand, obviously I am breaking the law, so I'm running the risk of being like captured and prosecuted. How does the pay compare? Is it more or less than like someone who does that kind of thing legitimately?

[A]

I think it depends usually on the risk. The higher the risk, and that's very similar with the legal economy as well. The higher the risk, the more generally you are paid. I mean, particularly in the world of black markets. You know, you mentioned gambling, for example, that has now become legalized in the majority of US states. It brings in, I think it's something like $200 billion a year. Illegal gambling has actually been growing even though it's been legalized. Black market gambling, it brings in, I think it's something like $600 billion a year. And that's partly because people decide, you know, sometimes you want to gamble, you don't want your loved ones to know about it, your wife, your parents, whatever it is. So you prefer to do it in websites that people won't find out about it. You don't want to get taxed sometimes you don't want.

[B]

Yeah, you don't want to get taxed on this amount of money you're winning on your gambling.

[A]

That's exactly it. You don't want to get taxed. So sometimes it's about tax incentives and wanting to make more money, but a lot of times it's also actual need. You spoke about fake pharmaceuticals. It's a huge, massive business. I think it's something like 20 million Americans or something that can't afford their life saving medication. So they have to go online to pharmacies. Most of them are in India or to Mexico. They cross the border into Mexico to buy their pharmaceuticals. And yes, because they are much cheaper there. The problem is that, that there's not as much quality control. A lot of the pharmaceuticals being made in Mexico are actually made by the cartel. Little fact that most people don't know. We did a story about this for trafficked and so there's little quality control and it can end in, you know, a lot of harm, sometimes death. So it's incredibly dangerous as well.

[B]

So the drug cartels are really in the drug business writ large. Not just illegal drugs, but even pharmaceuticals.

[A]

Yes, to some extent. In our reporting we realized, and actually the LA Times did incredible investigative reporting about this, how they started analyzing a lot of the medications that are sold at pharmacies on the border in Mexico and realized that some of them were tainted with fentanyl and meth and crazy other products. And so we started investigating this and trying to understand why this was happening. And essentially, I mean, wherever the cartel figures out that they can make some money, they'll be in that business, whether it's illegal fishing or drugs, as we know, immigration, and in this case, fake pharmaceuticals. So what we found out was that the cartels had figured out how they could create their own products, hire actual chemists to create products, and sometimes because of lack of quality control, they'd get tainted with other illegal products and then sell them and even force pharmacies to sell their products so they can make money from them.

[B]

Tell me about, like, the HR operation. I'm fascinated by this. Like, these are large organizations with large numbers of employees, and presumably a lot of those employees are just, like, on payroll and need to get paid a certain amount of money every two weeks or whatever, just like any normal people. Like. Like, how do they get paid? And do they then need to start worrying about, how do I launder this and make it legitimate?

[A]

Effy? Absolutely. The laundering is always the most complicated part. One of the things that I remember King Coyote telling us was why HR was important. Why was it important to make sure that your people are working for you in these sort of large organizations, why you need to keep them happy, and why you need to keep your clients happy. And it's all, again, it's word of mouth, right? And if, as a client, if you're not treating them well, if they're not providing you a good experience of bringing them across the US or providing them the drugs that ultimately won't kill them, you're keeping your clients happy, and that's good. If you're not treating well your employees, there's a high risk. Trust is incredibly important because there are no court systems. You know, you don't have the legal system, but also, you know, threats are everywhere in black markets.

[B]

Do you find yourself very often or ever talking to people who had the choice between, like, I could do this illegally and make more money, or I could do it legally and make less money and choose the illegal option?

[A]

Not very often. More often than not, it is really lack of opportunity and lack of choice. But that's not always. I interviewed for my podcast, the bookie involved in Yotani scandal. I'm not sure if you remember that big scandal.

[B]

Yeah, we talked about it on the show. He was, like, stealing a bunch of money from Shohei Ohtani. And gambling interpreter.

[A]

That's right. Through a bookie called Matt Boyer, who we interviewed on the podcast. And this is a guy who's incredibly smart, who had, obviously, a ton of other opportunities, but who decided. And in fact, he was working illegally before. And then he realized that this actually, he loved doing this. He wanted to run an illegal booking operation. It became massive. He was moving. I think it was something like $40 million. Every Monday, he had to figure out how to get that money to the better. And it's insane. $40 million. And all of this had to be done sort of under the COVID Right. It wasn't legal money.

[B]

How does he do it? Like, I mean, he's not paying them in cash. Right.

[A]

He had couriers, he had dozens, if not hundreds of people working for him around the country. It was a combination of cash and money transfers and, you know, venmos and all of it. It's insanity. I would not be able to sleep at night if I had much responsibility.

[B]

So he is another one of these people who needs a whole, like, HR operation.

[A]

Right. And also where to store the money. Right. He also was paying, he said, when he was arrested, when the FBI came, came looking for him, he had money stuffed everywhere, including. He would pay this guy in his town, where he lives, to hide millions of dollars in cash or hundreds of thousands of dollars of cash in tires. It was like this tire shop and. Yeah, basement under his mattress, everywhere.

[B]

It strikes me that if I'm struggling with opening up legitimate bank accounts, not raising any red flags with the banking system, I'm hiding cash in tires and all of this kind of stuff. In a weird way, if I'm just owed a million dollars by some rich gambler guy in Los Angeles, everyone's asset is someone else's liability. If I put a million dollars in the bank, that means I'm owed a million dollars by the bank. That's problematic. If I'm owed a million dollars by some rich guy, then that's still my asset. I don't need to realize that asset. I don't need to. To extract that money from him. If I ever want to pay for something, I can always just go up to that guy and be like, pay this for me, and that will discharge your debt. Maybe if I'm in this line of business, having a bunch of people who owe me money in town, those are all assets. Those are all, like, accounts payable, you know?

[A]

Right.

[B]

And I can use those assets to pay for things. I can be like, if you pay for this, then that debt is Expunged.

[A]

Yeah, in a sense that is true. I mean, it's a little bit like how the cartel operates in the United States. They have their distribution distributors here in the United States. And I interviewed a guy called El Gringo, an American guy, doesn't speak a word of Spanish. He's one of the main distributors for the Sinalo cartel here in the US and one of the things the cartel does sends him drugs. It's not as if he can say I want X amount of fentanyl or meth. It's whatever the cartel has. And they always send way more than the guy can pay for. And the idea is that you keep somebody on the hook. So that guy, he owes money to the cartel. So you're going to keep him on the hook and he's going to keep working for the cartel because he's always going to owe money to the cartel. They're always offering him more product than he is able to pay for. So you're always keeping that person on the hook, which is a very classic tactic that the cartel has.

[B]

We need to take a very quick break to hear from some very legal companies that are not in the black market at all. But when we come back from these ads, we will talk more about all of the violence and crime that is part of this market. Today's show is brought to you by Vanguard. As we step into a new year, it's the perfect time for all the advisors listening to think about how to set your clients up for success. One way to do that is to level up your fixed income strategy. But bonds are tricky. The market is huge. Rates shift and risks hide in plain sight. That's why having a partner with scale and expertise matters. Vanguard brings both. Vanguard bonds are institutional quality. That isn't a tagline, it's a commitment to your clients. It means top grade products across the board. The Lineup includes over 80 bonds bond funds which are actively managed by a 200 person global squad of sector specialists, analysts and traders. Vanguard doesn't have one brilliant mind making all of the magic happen. Vanguard's philosophy is different. They believe the best active strategies shouldn't be locked away with one person. They should be shared across the team. That way every client benefits from the collective brain power, not just one individual's take. So if you're looking to give your client consistent results year in and year out, go see the record for [e-mail] audio. That's vanguard.com audio. All investing is subject to risk. Vanguard Marketing Corporation Distributed.

[A]

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[A]

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[B]

Tell me about the way that people in these industries think about the risk of, of getting caught by law enforcement. Is this like something they're constantly worried about? Is there always like this cat and mouse game? Or is it something that they just kind of live their lives and then one day there's a knock on the door?

[A]

It depends on the level of risk and the type of black market. Right. If you're dealing fentanyl, you're going to be sentenced and spend a long time in prison. Right. But if you're putting in an illegal bet in or, you know, the likelihood of you actually spending time in prison is very low. So it depends. But I would say that's always on the back of your mind, which is why every single person we interview, we need to make sure that we're hiding their identity. When we're talking about some of these black markets, at least on camera and not on the podcast, but on the show, we're hiding their identity. We're making sure that we're not disclosing the location. I mean, we spend months, sometimes even years convincing people to talk to us. It's the hardest part of my job. And when they do, we have to make sure that we're protecting their, their identities because obviously they've become our sources. It's our job as journalists to protect our sources.

[B]

So to ask the obvious question, why.

[A]

Do they talk to us?

[B]

Do they talk to you?

[A]

Yeah, I think three main reasons. It's ego. A lot of these people work in these black markets. They're the best counterfeiters and traffickers and scammers. And sometimes their families don't even know what they do. And they have an opportunity behind a mask to survive of boast about what they're so good at doing. I think it's impunity. In a lot of these places in the world, corruption is king. And so they don't really see a downside to talking to an International journalist that comes in from National Geographic and wants to talk to them. And then I think the most important reason is a very human characteristic that we all share of wanting to be understood. And I think I give people that opportunity. I tell them, I'm here not to judge you. I'm here to try to understand why you do what you do. And I think that goes a long way. And it goes back to the incentive. Incentives. I'm trying to understand, when I'm doing all these stories, the human side of it. I'm trying to get people to connect with the folks, consider the worst of the worst, right, the people operating these black markets. Because only by understanding what are the incentives and why they join and why they work on operating these black markets will we be able to prevent these black markets from existing. And I think sometimes we keep tackling these problems with law enforcement and building walls and not actually trying to understand the root cause behind all these black markets.

[B]

When you talk about the impunity, which countries in the world would you say, oh, yeah, that is a place where you can operate an illegal operation and obviously have impunity. You're never going to need to worry about that.

[A]

That's what black market operators are really good at. Right. They're trying to make as much money as they can and lower the risk. And so they're always going to try to find the place where they can do that and maximize their profit. And we filmed, and I've done reporting Myanmar, for example, where there these massive scam compounds with tens of thousands of people working day and night to scam Americans and Europeans and western folks that have more money and that are more likely to hand over their money. And these. What was shocking was finding out that a lot of these people that are there are forced labor. They go, they apply for jobs that they think they're going to be working in a legal job. And instead when they get there, they take away their passports. The bosses, the owners of these compounds, scam compounds, take away their passports, beat them, torture them, electric shocks. It's horrific what's happening there, and it's complete and total impunity. We actually had the opportunity to go inside and visit one of these scam cities.

[B]

Is that part of the junta? Do the profits from that flow up to the government?

[A]

Yeah, there are several different military groups in the area that are fighting for control of this area against the junta, the military junta. And they're making a lot of money also from these scam compounds. So it's not in their interest to make sure. That they're closed down. And in Mexico, the same thing. I mean, I've spent more time in Sinaloa than I think anywhere else in the world outside of the United States. As a reporter, you know, there's enormous corruption, and one of the biggest problems. We did a story for Traffic this last season called Cartel usa, where we sort of looked at what the presence of the cartel in the United States. And I think most people just, they think cartel, they think violence, they think drugs, but they don't understand how none of these. They can't operate without corruption and how corruption has fully seeped in into the United States. So I spoke to law enforcement agents, I spoke to drug distributors, and every single one of them in every single interview I did pointed to corruption as being sort of the multiplier. And without it, they wouldn't be able to operate at the scale that they do.

[B]

You've been covering this, as we've mentioned, for a while. Over the course of your career, would you say that the United States has become significantly, visibly more corrupt?

[A]

Yes. It's not me saying. It's law enforcement people, folks that I've been talking throughout the years. I mean, in this case particularly, we started our investigation with a woman who was tortured and killed inside a cabin in Georgia, in a little town in the middle of nowhere in the woods. And again, I think most people think drugs and cartels, violence, they think big cities, they're everywhere. And they're only allowed to operate because of corruption and the amount of money that is being paid to local officials, to law enforcement, even to federal agents. I've worked extensively on the border. I've seen fentanyl. I've seen a woman crossing into the United States with 5 kilos of fentanyl. And we did a story about how a lot of the fentanyl that comes across. I think you know this well, too. Felix doesn't come through, you know, the Pacific in fishing boats. The majority of the drugs that come into the United States come through official ports of entry, and a lot of it is done through corruption.

[B]

If I, you know, put you in charge of America for a few weeks, what would be the main sort of policy response that you would try and implement in order to reduce the amount of corruption in this country?

[A]

This is why I'm not running for president.

[B]

All right, all right, let me rephrase the question. Is there a good example that you can think of maybe somewhere else in the world where the degree of corruption has come down significantly over the years you've been reporting about this?

[A]

Yeah, absolutely. If you look around the world, places where there is more corruption is places where police force isn't well paid, government officials aren't well paid. Right. So there's a bigger incentive. If you're risking your life as a police officer every day, going out on the streets and you're paying pennies, there's an enormous. And then suddenly a guy, a drug trafficker comes up and says, look, I'll pay you this amount more, which is whatever amount you get paid in a year or more for you to work with us. The incentive is there. It's all about changing the incentives, giving people the pay that they deserve and yeah, making sure that civil servants and law enforcement are paid well and that there is no incentive there for them to turn to the black market Ultimately.

[B]

One of my favorite ever episodes of Slate Money was when we had Yuan Yuan ang on talking about the history of corruption in China and how it like kind of helped a little bit with development for a while until it became harmful and then there was this big corruption crackdown. I think a similar story can be told about Indonesia, where, you know, it's useful until it's harmful. Tell me a little bit about China though, I'm sure just such a sort of superpower in so much of the global economy right now. Certainly we had a great interview quite recently with Joe Salama about money laundering. And they seem to be like the number one source of demand for your dollars in the world. They will launder your dollars for much less than anyone else because they want those dollars for various reasons. Do you think that the rise of China as a part, as its share of the global economy has coincided with rise in the black and gray markets?

[A]

Yes, it's interesting on the ground because I've been reporting on this for so many years. Five, six years ago, I started hearing about Chinese money laundering and before the cartel would figure out other ways of laundering their money. And suddenly it seems like it's not only here in the United States. I've heard it's in the UK and in Europe all around, where these operations with Chinese folks ready to launder your money and that it's become much easier. They take a much smaller share and that they're everywhere. So yeah, I mean, it's usually the cog in the system. Right. It's the biggest headache. I think for many of these black market operators, making money, as they say, isn't the difficult part. Laundering that money is a hard. Have a country like China and folks here in the United States from China Ready to launder that money and making it easy and fast. That's only going to grow whatever black market you're involved in.

[B]

Are you relatively sort of, I don't know, realistic, pessimistic, I don't know what the word is like. You've been doing this for a long time. It sounds like it's only really got worse over that time. Do you ever feel like you're just chronicling the slow decline of civilization here?

[A]

The more I report on these black markets, the more I understand that it's the systems that are broken. It's not so much human beings. When I'm Talking to a 16 year old kid who travels through the mountains of Peru with 30 kilos of cocaine on his back because he wants to one day be able to afford college to become a dentist, this is a story of a kid that we met and interviewed. You know, you realize that it's not. This kid is not doing this because he wants to. He's doing this because he has no alternatives. And that these kids and these mothers that I've spoken to and people all around the world there are people, human beings just like you and I. They have goals and aspirations. They're our neighbors, they're mothers, they're fathers. And it's because of lack of opportunities they end up. They do. And so that has given me sort of enormous hope in humanity knowing that even when I'm meeting face to face these sicarios and traffickers and scammers, that they can still find humanity and that there is still redemption possible there. But it's the systems that are broken. And so if we can tackle those, then, you know, we'll very cliche, but we'll sort of create a better world. And so that's given me a lot of optimism in humanity in the world.

[B]

Yeah, I'm probably taking the other side of that one because it strikes me that what you're really talking about is inequality where there's a massive difference between the poverty in somewhere like Peru or Myanmar and the riches that you can find in the UK or the us Then there will be criminals who try to sort of arbitrage that and take advantage. And so long as inequality is going up, we're not going to make a lot of progress on this front.

[A]

I 100% agree. I know, but again, it's the system, right? It's what's put in place. It's not the human beings biggest problem. Our time, I really believe is inequality. We have half of the world's population with less than $7 a day and that's just unattainable. As long as there's inequality, there's going to be violence.

[B]

Mariana Van Zeller, thanks so much for coming on Money Talks. It's slightly pessimistic conclusion, but a fascinating conversation all the same. Remind us of your podcast and presumably we can find it wherever you get your podcast. As they always say, I'm gonna do.

[A]

My podcast voice you can watch on YouTube Marianna Van Zeller or listen to the Hidden Third wherever you get your podcasts.

[B]

Thank you so much for coming on. Thank you so much to Jessamyn Molly and she and rocks for producing. And we will be back on Saturday with a regular episode of Sleep Money.

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