The Patriot Act....Dangers?

Special report from India

I am in Bombay, India. The monsoons are on, and with constant rain and tropical wind the city functions under a cloud and in a veritable lake. Beggars and street vendors vie to find protection under plastic tarps, umbrellas or even trees. Anything to shield them from the torrents of monsoon rains.

But inside, in the ancient wooded chambers of the International Merchant’s Chamber it is dry. This is perhaps the most prestigious Chamber of Commerce in Asia. Mahatma Ghandi was a member. The Chamber facility is a four-story building, complete with library, conference rooms, and high tech Internet services. Every businessman of success in Mumbai knows the power that the IMC wields in Mumbai, India.

Here today, business executives had gathered to discuss the economic implications of the National Patriot Act of the United States. As a former banker, naturally I was invited to participate.

An Indian Bank executive spoke first. “In India, the government cannot freeze or seize the assets you have in a bank. But with the National Patriot Act of the USA the government has the right to arbitrarily seize bank accounts, and it can keep a customer’s assets for years without due process.” His concern was on the import/export business. An Indian industrialist who exports millions of dollars of goods annually to the United States said: “We are uncomfortable keeping funds in the United States now. The Patriot Act makes us feel vulnerable. Plus reports of some of our employees going to America to do business have been detained by the INS… it is hard enough to export, but then these additional security requirements create more difficulty for us.”

Businessmen in the room echoed comments of problems with trying to do business in the US since 9/11. They recounted other problems such as:

1. Delays in unloading shipments in U.S. harbors.
2. Increased paper work. Damage done by customs and INS inspectors to merchandise and equipment during inspections.
3. Higher security costs and fees when goods arrive in U.S.A. ports.

But of the most concern are the implications for the banking system of the United States under the Patriot Act. It has long been known by bank executives that the Federal Government has the right to take over control of the banking system and all bank assets by decree of the President. But now, with the Patriot Act in place, the government can specify a person, or company and seize all assets, leaving bank depositors with little recourse. An American can be arrested and imprisoned without due process of law, and can be held without counsel. In our discussion of Public Policy vs. Private Rights the consensus of Indian bankers and business executives is that individuals and businessmen in the United States now have fewer rights and less freedom than nations such as a developing nation like India. As one commented: “Even communist China has not gone to the extremes that the Patriot Act of America takes away personal financial rights.”

The forefathers of America, Jefferson and Hamilton warned against this in their early analysis of the American system. Both wrote that the American people should never allow the Federal Government power to reduce their freedoms.

It is ironic that I had to be reminded of this, during a monsoon, by business executives of India. “Are Americans asleep? How can you allow such a thing?” an Indian attorney, and student of American law asked. How indeed.