Let Me Tell You About Striking Oil in South America (3)
On the western side of San Marcos there existed a storied coal mine known as Mine No. 7.
Rich in deposits, it had shouldered a significant share of the nation's electricity generation since independence. But the years had worn it down. The reserves dwindled, and the mine's strength faded with them.
Recently, however, the mine had come back to life. As the saying goes, even a dried squid will yield water if you squeeze hard enough — they kept digging, and a new coal seam was found.
There was just one problem. The seam lay far too deep. So deep, in fact, that temperatures in the new shafts exceeded forty degrees Celsius.
Naturally, the miners refused to work, insisting that no human being could labor in such conditions. The executives of the Coal Corporation sank into a deep gloom. Just as the mine's reason for existing had been evaporating along with its plummeting output, a glimmer of hope had appeared — only for them to find they couldn't actually extract it.
Thankfully, His Excellency Eugene Choi — the light and salt of San Marcos, its very sun — personally stepped forward and resolved the matter. He sent the criminals to the mine to work off what they owed.
And so, inside the mine, San Marcos Detention Camp No. 7 was born.
Fifty dugouts, visible after about a three-minute ride down in a mine cart from the entrance. Each measured scarcely thirty-six square feet, furnished with nothing more than a damp bedroll, a bucket for waste, and a shovel for dealing with it. The one mercy was that they were solitary cells.
But something else drove the inmates far madder than the wretched facilities.
"Number 1405! Move it!"
Forced labor in a hell that ran hotter than forty degrees Celsius.
Josh Harrington spat a curse as the scorching heat washed over him.
"Goddamn it..."
The daily routine was simple. Wake at seven, eat breakfast, get sent into the shafts to mine coal for ten hours. Then dinner, a wash, and back to the cell to sleep. That was it. There was a quota, of course — finish early and you could rest — but the amount was so punishing that Josh had never once filled it.
In America, human rights groups would have been up in arms and the UN would have intervened over working conditions like these. But this was San Marcos, a place that didn't give a damn about a criminal's human rights.
I have to escape... I have to get out of here.
So Josh dreamed of escape whenever he got the chance. He'd even plotted in secret with the Cevron executives who'd been captured alongside him. But that plan was in the trash before long.
How the hell... there's only one way out.
To reach the surface you had to pass through roughly a kilometer of underground shafts, and armed guards stood watch every hundred meters. The only time you could even go outside was mealtime, and even then thirty soldiers with automatic rifles kept an ironclad watch. Escape under those conditions? You might as well ask them to turn you into a honeycomb.
And what truly tormented Josh wasn't the hellish heat or the labor.
"Hey, Yankee."
It was the people.
"Tonight. You know the drill."
Garcia Coutinho. The worst kind of insurrectionist — a man who'd started a civil war — serving time in the same camp, and he never stopped tormenting Josh.
"P-please... if you could just stop..."
Thud!
Garcia's fist slammed into Josh's solar plexus.
"Guh—!"
"If you hadn't talked me into it, I wouldn't be living like this. You dumped my life in the gutter. And you want me to stop? You don't wanna die, you be ready tonight. Got it?"
It wasn't just Garcia. His younger brother Dani Coutinho, the former SIA director and bureau chiefs locked up on embezzlement charges, the high-ranking officials dismissed for corruption — every last one of them, men who'd once been somebody, blamed their downfall entirely on Cevron. On Josh and his executives.
And in a way, they weren't wrong. Cevron's scheming had killed President Juan and his cabinet, and that terrifying Eugene Choi had seized power as a result. Thanks to that, Josh and the former Cevron executives were living a life of hell.
"Hey, you little princess. Call that shoveling? Never been in the army, have you?"
The former SIA bureau chief smacked Josh across the back of the head.
"Move it, you son of a bitch! You're backing up the whole line!"
Dani Coutinho kicked him in the back.
Every last one of them was a military man. Josh and his executives, who'd spent their entire lives pushing pens, didn't stand a chance. Beaten by the guards during the day, beaten by fellow inmates during breaks, and at night subjected to things too horrific for words — Josh wept.
"Hngh..."
Death would have been better. Should he snap a shovel handle and drive it through his throat? Smash his head against the wall? But a man who'd lived his whole life in wealth and comfort didn't even have the courage to kill himself.
That was when it happened.
Click. Click.
The sound of leather heels, utterly out of place in this hellish shaft. Josh lifted his head to see a man in a crisp suit approaching, a handkerchief pressed to his nose.
"My, my. Prison doesn't seem to be agreeing with you."
It was Lucio, Director of the SIA — the very man who'd thrown him in here.
"Settling in all right?"
San Marcos's crude oil exports were sailing along as if the wind itself were at their back.
"The major oil companies in the United States have formed a line, sir."
I couldn't hide the satisfied smile at Isabella's report. And why wouldn't I? Not only had the reserves tripled — the quality was far better than we'd been told.
Back when we'd negotiated with Cevron, they'd said it was heavy crude similar to Venezuela's. But once we actually started drilling, it turned out to be light crude comparable to Guyana's. Refining costs were modest, and thanks to the geographic advantage, the American oil majors bought every barrel we put on the market.
"That's a relief."
"Once Cevron's offshore platform comes online, daily production will increase to 400,000 barrels. At current oil prices, that would put revenue at approximately 9.5 billion dollars."
"Nine and a half billion..."
Of course, that wasn't all profit. FPSO drilling costs ran about twenty-five dollars a barrel, and the offshore platform about twenty. After taking those off the top, you'd have roughly six billion left, but...
I'll take it.
Considering there was a time when San Marcos's entire annual budget didn't even reach two billion dollars, this was more than we could have dreamed of. What's more.
"Once the oil refinery is completed, the added value is expected to rise even further. If we can sell refined petroleum products to neighboring countries such as Venezuela and Guyana, the margins will double."
Refining added another four to five dollars of margin per barrel. Small compared to the margin on selling crude, but not something to dismiss. Oil fields run dry eventually. A refinery can keep running forever. Hell, even if we just imported Venezuelan crude, refined it, and resold it, we'd be printing money. A sustainable revenue stream, you could call it.
If things kept going like this, a bright tomorrow and a beautiful future for San Marcos were as good as guaranteed... or so I thought.
The United States had decided to throw a wrench in the works.
"You've got to be kidding me."
How much greater did this guy need to become to pull this crap?
"They're the ones who asked us to sell. We didn't even want to sell in the first place."
Just a few months ago it was do exactly that! We'll push hard for you during my term! You bastard!
"...Has he gone senile?"
The cause of this mess was crystal clear. San Marcos was raking in massive amounts of dollars selling crude, while the amount we imported from the United States was a pittance. It couldn't be helped. San Marcos's purchasing power was among the lowest in the world — even if we imported American goods, nobody would buy them.
People already think Mexican products are too expensive. American ones? Forget it.
When four hundred dollars a month made you a high earner, how were you supposed to buy a forty-thousand-dollar American car? Or a fifty-dollar shirt? Grain was the one exception — American grain was cheap enough to import. Manufactured goods were a nonstarter.
Anyway, if I had to sum up the current situation in a word...
"We're screwed."
That was the conclusion. So what could you do at a time like this?
"I apologize for the late hour, but I need to convene a cabinet meeting. Please gather the senior secretaries at once."
Collective intelligence.
A little past one in the morning, having summoned the senior secretaries, Eugene spoke.
"It's here. What we knew was coming."
The atmosphere in the conference room was as heavy as a funeral. USMCA member countries currently faced a ten percent tariff on crude oil. If San Marcos crude got hit with a thirty percent tariff, its price competitiveness would vanish.
Of course, we could sell to other countries. South Korea alone had more than enough capacity to import. But would they pay as well as the United States? That was another question. The savings on shipping costs meant they paid a premium. That was the structure.
Even granting that we could take a hit on price and sell to Europe or Asia — that could never be the answer.
If we take the tariff now, it means we'll keep taking it going forward.
Oil isn't unlimited. It'll run out someday. Thinking ahead to when we convert into an industrial nation, this was the worst possible outcome. In the end, there was only one answer. Dodge it as much as possible. And if we had to take the hit, take the smallest one we could.
"We need to increase imports. If we buy a lot of American goods, the trade deficit shrinks, and they lose their justification for the tariff."
"Who doesn't know that? The question is what we buy."
A difficult problem. A free-for-all erupted among the senior secretaries.
"Let's increase food imports. Corn, wheat flour, that sort of thing."
"We can't even eat everything we have now. What's the point of importing more? Are we going to give it away to the people for free? That's communism. That's socialism."
"Then let's import gold. If we buy American gold bullion..."
"Don't be ridiculous. Where would we even buy that much gold? And if we start stockpiling gold, they'll scream that we're plundering America's gold and throw an even bigger fit."
"Then let's replace every government vehicle with American cars."
"How many government vehicles do we even have? Why don't you just import six million cars and give one to every citizen while you're at it?"
"Hey! You think just saying something makes it true?!"
Just when it seemed there was no answer, Isabella, who had been keeping silent, spoke up.
"What if we were to purchase U.S. Treasury bonds?"
"Treasury bonds?"
"Yes. If we use the dollars we have earned to buy American Treasuries, that money ultimately flows back into the United States. From America's perspective, it would have the effect of recovering dollars and would also help their fiscal situation. I see no reason they would object."
"Ah...!"
I slapped my knee. From the buyer's perspective, U.S. Treasuries were as good as cash. And they paid interest on top of that — there was no way to lose.
"That's a good idea. Review it together with Senior Secretary Ricardo."
"Yes, sir. Understood."
But I still felt uneasy. The other party was Drumpf — a rugby ball of a man who could bounce in any direction. Would buying some Treasuries really satisfy him?
We're going to need something more. A surefire knockout punch.
As I followed that train of thought...
"Your Excellency, might I have a word with you somewhere private?"
Lucio requested a private meeting, and what he proposed was shocking.
"I was thinking we might consider making a contribution to the Republican Party."
"A contribution?"
"Yes. Whether it's campaign funds or political donations — if we put money in their hands and lobby, I believe it would be effective."
"Hmm..."
He wasn't wrong. America was a country where lobbying was legal. However.
"Isn't it illegal for a foreign government to donate to an American political party? That could blow up in our faces."
The problem was that if a non-American — and not even with personal funds, but with state money — made a donation, it became a bribe. Of course, people lobbied under the table. Japan had been quietly spreading lobbying money for years. But that was Japan — America's top-priority ally and the world's third-largest economy. If San Marcos tried the same thing, we'd get the living daylights beaten out of us.
If we lobby the Republicans, there's no way the Democrats will sit still.
Hadn't people who'd lobbied for Russia been indicted as spies, one after another?
But Lucio, as always, had found an answer.
"That's correct. Officially, it's impossible."
"Then?"
"A San Marcosan-American donates in a personal capacity."
"Ah... right. A donation by someone with U.S. citizenship would be legal."
"Musk, the Tesla and media mogul, reportedly donated three hundred million dollars in the last election. If we donated that kind of money, I believe we could firmly win Drumpf's favor."
"...Three hundred million?"
A fortune so large my jaw dropped.
"Is there a San Marcosan-American who could put up that kind of donation money...?"
"I can say with certainty that if you pooled the entire fortune of every San Marcosan living in the United States, you wouldn't even get a hundred million, let alone three hundred million."
"Then?"
"The government would have to provide support, of course."
"...I just told you that won't work. As I said, if we use the national budget for a donation, it becomes a bribe. And don't even think about laundering it. This is America we're talking about... they will catch it. Guaranteed."
"Don't worry. Our SIA has prepared some money with no name tags attached."
"Money with no name tags?"
"The former Cevron executives locked up in the detention camp? We went through their pockets and found a considerable amount of thoroughly laundered money. If we lobby with this, we'll never get caught. It's all in crypto assets, and the ultimate owners are Americans."
"H-how much are we talking?"
"A little over seven hundred million dollars."
I stared at him.
Looking at Lucio's face — a man whose expression was practically begging to be praised — I thought:
If I sent this guy to Korea, tax delinquents would go extinct.