Smuggling

The verb smuggle, from Low German smuggeln or Dutch smokkelen (="to transport (goods) illegally"), apparently a frequentative formation of a word meaning "to sneak", most likely entered the English language during the 1600s–1700s.[2]

A book with cigarettes.

Smuggling has a long and controversial history, probably dating back to the first time at which duties were imposed in any form, or any attempt was made to prohibit a form of traffic. Smuggling is often associated with efforts by authorities to prevent the importation of certain contraband items or non-taxed goods; however, there has also been smuggling based on illegally exporting goods. In England smuggling first became a recognised problem in the 13th century, following the creation of a national customs collection system by Edward I in 1275.[3] Medieval smuggling tended to focus on the export of highly taxed export goods — notably wool and hides.[4] Merchants also, however, sometimes smuggled other goods to circumvent prohibitions or embargoes on particular trades. Grain, for instance, was usually prohibited from export, unless prices were low, because of fears that grain exports would raise the price of food in England and thus cause food shortages and/or civil unrest. Following the loss of Gascony to the French in 1453, imports of wine were also sometimes embargoed during wars to try and deprive the French of the revenues that could be earned from their main export.

Most studies of historical smuggling have been based on official sources — such as court records, or the letters of Revenue Officers. A senior academic of the University of Bristol states that they only detail the activities of those dumb enough to get caught.[5] This has led him and others, such as Prof. H. V. Bowen of the University of Swansea to use commercial records to reconstruct smuggling businesses.[6] Jones' study focuses on smuggling in Bristol in the mid-16th century, arguing that the illicit export of goods like grain and leather represented a significant part of the city's business, with many members of the civic elite engaging in it, whether by disguised/hidden transport or mis-description of goods.[7] Grain smuggling by members of the civic elite, often working closely with corrupt customs officers, has also been shown to have been prevalent in East Anglia during the later 16th century.[8]

In England wool was smuggled to the continent in the 17th century, under the pressure of high excise taxes. In 1724 Daniel Defoe wrote of Lymington, Hampshire, on the south coast of England

"I do not find they have any foreign commerce, except it be what we call smuggling and roguing; which I may say, is the reigning commerce of all this part of the English coast, from the mouth of the Thames to the Land's End in Cornwall."[9]

The high rates of duty levied on tea and also wine and spirits, and other luxury goods coming in from mainland Europe at this time made the clandestine import of such goods and the evasion of the duty a highly profitable venture for impoverished fishermen and seafarers. In certain parts of the country such as the Romney Marsh, East Kent, Cornwall and East Cleveland, the smuggling industry was for many communities more economically significant than legal activities such as farming and fishing. The principal reason for the high duty was the need for the government to finance a number of extremely expensive wars with France and the United States.

Before the era of drug smuggling and human trafficking, smuggling had acquired a kind of nostalgic romanticism, in the vein of Robert Louis Stevenson's Kidnapped:

"Few places on the British coast did not claim to be the haunts of wreckers or mooncussers.[10] The thievery was boasted about and romanticized until it seemed a kind of heroism. It did not have any taint of criminality and the whole of the south coast had pockets vying with one another over whose smugglers were the darkest or most daring. The Smugglers Inn was one of the commonest names for a bar on the coast".[11]

In North America, smuggling in colonial times was a reaction to the heavy taxes and regulations imposed by mercantilist trade policies. After American independence in 1783, smuggling developed at the edges of the United States at places like Passamaquoddy Bay, St. Mary's in Georgia, Lake Champlain, and Louisiana. During Thomas Jefferson's embargo of 1807-1809, these same places became the primary places where goods were smuggled out of the nation in defiance of the law. Like Britain, a gradual liberalization of trade laws as part of the free trade movement meant less smuggling. in 1907 President Theodore Roosevelt tried to cut down on smuggling by establishing the Roosevelt Reservation along the United States-Mexico Border.[12][13] Smuggling revived in the 1920s during Prohibition, and drug smuggling became a major problem after 1970. In the 1990s, when economic sanctions were imposed on Serbia, a large percent of the population lived off smuggling petrol and consumer goods from neighboring countries. The state unofficially allowed this to continue or otherwise the entire economy would have collapsed.

In modern times, as many first-world countries have struggled to contain a rising influx of immigrants, the smuggling of people across national borders has become a lucrative extra-legal activity, as well as the extremely dark side, people-trafficking, especially of women who may be enslaved typically as prostitutes.

Research on smuggling as economic phenomenon is scant. Jagdish Bhagwati and Bent Hansen first forwarded a theory of smuggling in which they saw smuggling essentially as an import-substituting economic activity. Their main consideration, however, was the welfare implications of smuggling. Against common belief that the private sector is more efficient than the public sector, they showed that smuggling might not enhance social welfare though it may divert resources from governments to the private sector.[25]

In contrast, Faizul Latif Chowdhury, in 1999, suggested a production-substituting model of smuggling in which price disparity due to cost of supply is critically important as an incentive for smuggling.[26] This price disparity is caused by domestic consumption-taxes and import duties. Drawing attention to the case of cigarettes, Chowdhury suggested that, in Bangladesh, smuggling of cigarettes reduced the level of domestic production. Domestic production of cigarettes is subject to value added tax (VAT) and other consumption tax. Reduction of domestic taxes enables the local producer to supply at a lower cost and bring down the price disparity that encourages smuggling.

However, Chowdhury suggested that there is a limit beyond which reducing domestic taxes on production cannot confer a competitive advantage versus smuggled cigarettes. Therefore, government needs to upscale its anti-smuggling drive so that seizures (taking possession of person or property by legal process) can add to the cost of smuggling and thus render smuggling uncompetitive. Notably, Chowdhury modeled the relationship of the smuggler to the local producer as one of antagonistic duopoly.

On the other hand, research by Tat Chee Tsui in 2016 suggests that even if increasing cigarette duty may encourage smuggling, total cigarette-consumption still declines because the price of illicit goods, as substitutes of taxed cigarettes, also increases because of higher tax rate.[27]

One economic view sees smuggling as monopoly-busting - as a challenge to state-sponsored restrictions or taxes on trade.[28][29]

X-ray of an abdomen piled up with cocaine

In smuggling, concealment can involve concealing the smuggled goods on a person's clothing, luggage or inside a body cavity. Some smugglers hide the whole transportation vehicle or ship used to bring the items into an area. Avoiding border checks, such as by small ships, private airplanes, through overland smuggling routes, smuggling tunnels and even small submersibles.[30][31] This also applies for illegally passing a border oneself, for illegal immigration or illegal emigration. In many parts of the world, particularly the Gulf of Mexico, the smuggling vessel of choice is the go-fast boat.

Submitting to border checks with the goods or people hidden in a vehicle or between (other) merchandise, or the goods hidden in luggage, in or under clothes, inside the body (see body cavity search, balloon swallower and mule), etc. Many smugglers fly on regularly scheduled airlines. A large number of suspected smugglers are caught each year by customs worldwide. Goods and people are also smuggled across seas hidden in containers, and overland hidden in cars, trucks, and trains. A related topic is illegally passing a border oneself as a stowaway. The high level of duty levied on alcohol and tobacco in Britain has led to large-scale smuggling from France to the UK through the Channel Tunnel. The combination of acknowledged corruption at the border and high import tariffs led smugglers in the 1970s and ‘80s to fly electronic equipment such as stereos and televisions in cargo planes from one country to clandestine landing strips in another, thereby circumventing encounters at the frontier between countries.[32]

For illegally passing a border oneself, another method is with a false passport (completely fake, or illegally changed, or the passport of a lookalike).

At Border checkpoints, especially for shipping cargo, Border agents must inspect cargo for smuggled and illegal goods. However, because of what is called Gridlock a maximum of 5% inspections per cargo holds worldwide.[33] Since it can take a proper and complete inspection four to six hours, major global trade routes such as Singapore offer great opportunity for smugglers and traders alike. As the leading Cape Town Customs Official argues, if a shipping port stops and inspects every ship it would cause a total shipping grid lock, which is trade gridlock, which is also economic gridlock.[34]  By under-declaring and misrepresenting, even the most surprising goods is common practice when smuggling. What popular culture doesn’t communicate, is that illegal drugs and arms are not the bane of customs officers and the ultimate threat to their economy. In reality, the most commonly smuggled items are everyday items one believes to be common and thus causes higher losses in tax revenue. An anonymous shipping agent said that smuggling becomes second nature to businessmen, taking finished products and misrepresenting them to offer the cheapest possible rate. What the majority of people do not realize, is that the media and popular culture focus on criminal organizations as primary smugglers, but in reality legitimate businesses are the biggest offenders.[35] By incorporating their label on merchandise or products, it leaves bias towards their goods as the popular media portrays them as reliable. Smuggling, however, is produced through the very culture of the shipping industry and is affected by institutionalized tariffs and taxes around the world.[36]

The existence of the Multi-Consignment Contraband (MCC) smuggling method (smuggling two or more different types of contraband such as drugs and illegal immigrants or drugs and guns at the same time) was verified following the completion of a study that found 16 documented cases of smugglers transporting more than one type of contraband in the same shipment.[37] MCC shipments were frequently associated with Phase II and Phase III smuggling organizations.

In popular perception smuggling is synonymous with illegal trade. Even social scientists have misconstrued smuggling as illegal trade.[47] While the two have indeed identical objectives, namely the evasion of taxes and the importation of contraband items, their demand and cost functions are altogether different requiring different analytical framework. As a result, illegal trade through customs stations is differently considered, and smuggling is defined as international trade through ‘unauthorized route’.[48] A seaport, airport or land port which has not been authorized by the government for importation and exportation is an ‘unauthorized route’. The legal definition of these occurs in the Customs Act of the country. Notably, some definitions define any 'undeclared' trafficking of currency and precious metal as smuggling. Smuggling is a cognizable offense in which both the smuggled goods and the goods are punishable.

• Arms trafficking
• Battle of Mudeford
• Carding (fraud)
• Cigarette smuggling
• Counterfeiting
• Daigou
• French Connection
• Iron Law of Prohibition
• Pizza Connection Trial
• Rescates
• Rum-running
• Snakehead (gang)
• The Yogurt Connection

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Look up smuggling in Wiktionary, the free dictionary.

• Andreas, Peter. Smuggler Nation: How Illicit Trade Made America. (New York: Oxford University Press, 2013).
• Cohen, Andrew Wender. Contraband: Smuggling and the Birth of the American Century. (New York: W.W. Norton, 2015).
• Cole, W. A. “Trends in Eighteenth-Century Smuggling.” Economic History Review 10#3 1958, pp. 395–410. online in Britain
• Díaz, George T. Border Contraband: A History of Smuggling across the Rio Grande (University of Texas Press, 2015) xiv, 241 pp. excerpt
• Graham, Frank, Smuggling in Cornwall (Newcastle upon Tyne, V. Graham, 1964).
• Graham, Frank, Smuggling in Devon (Newcastle upon Tyne, Frank Graham, 1968).
• Harper, Charles G., Smugglers: Picturesque chapters in the Story of an Ancient Craft (Newcastle upon Tyne, Frank Graham, 1966)
• Harvey, Simon, Smuggling: Seven Centuries of Contraband (London: Reaktion Books, 2016).
• Jones, Evan T., 'Illicit business: accounting for smuggling in mid-sixteenth century Bristol', Economic History Review, 54 (2001). Winner of the Economic History Society's "T.S. Ashton Prize" in 2001, freely available online.
• Jones, Evan T, Inside the Illicit Economy: Reconstructing the Smugglers' Trade of Sixteenth Century Bristol (Ashgate, June 2012)
• Karras, Alan. Smuggling: Contraband and Corruption in World History (Lanham, Rowman and Littlefield, 2010) 199 pp.
• Karson, Larry, American Smuggling and British white-collar crime: A historical perspective (PDF), British Society of Criminology

• Karson, Lawrence. American Smuggling as White Collar Crime. (New York: Routledge, 2014).
• Morley, Geoffrey, Smuggling in Hampshire & Dorset 1700-1850 (Newbury: Countryside Books, 1983). ISBN 0-905392-24-8.
• Rattenbury, John, Memoirs of a Smuggler (Newcastle upon Tyne, V. Graham, 1964).
• Smith, Joshua M., Borderland Smuggling: Patriots, Loyalists and Illicit Trade in the Northeast, 1783–1820 (Gainesville, University Press of Florida, 2006). ISBN 0-8130-2986-4.
• Waugh, Mary, Smuggling in Kent and Sussex 1700–1840 (Countryside Books, 1985, updated 2003). ISBN 0-905392-48-5.