A Game As Old As Empire

[Guest guest]

http://www.alternet.org/story/21245/

 

 

A Game As Old As Empire

 

By Amy Goodman, Democracy Now!. Posted February 16, 2005.

 

 

The author of the gripping new book, Confessions of an Economic Hit

Man, reveals how the U.S. became the world's largest superpower: by

forcing developing countries into debt.

 

 

John Perkins, author of Confessions of an Economic Hit Man, worked for

years as chief economist at an international consulting firm in Boston

called Chas. T. Main. His job was to persuade countries that are

strategically important to the U.S. - such as Indonesia, Panama,

Ecuador, Iran and Saudi Arabia – to accept enormous loans for

infrastructure development and then to make sure the lucrative

projects were contracted out to U.S. corporations. Saddled with huge

debts they couldn't possibly repay, these countries came under the

control of the U.S. government, the World Bank and other

U.S.-dominated aid agencies that acted like loan sharks, dictating

repayment terms and bullying foreign governments into submission.

 

AMY GOODMAN: Now, already people are going to be wondering, what is he

talking about, " economic hit man " ?

 

JOHN PERKINS: Well, really, over the past 30 to 40 years, we economic

hit men have created the largest global empire in the history of the

world. And we do this, typically – well, there are many ways to do it,

but a typical one is that we identify a third-world country that has

resources that we covet. And often these days that's oil, or might be

the canal in the case of Panama.

 

In any case, we go to that third-world country and we arrange a huge

loan from the international lending community; usually the World Bank

leads that process. So, let's say we give this third-world country a

loan of $1 billion. One of the conditions of that loan is that the

majority of it, roughly 90 percent, comes back to the United States to

one of our big corporations, the Bechtels, the Halliburtons. And those

corporations build in this third-world country large power plants,

highways, ports, or industrial parks – big infrastructure projects

that basically serve the very rich. The poor people in those countries

and the middle class suffer; they don't benefit from these loans, they

don't benefit from the projects. In fact, often their social services

have to be severely curtailed in the process of paying off the debt.

 

Now what also happens is that this third-world country then is saddled

with a huge debt that it can't possibly repay. For example, today,

Ecuador. Ecuador's foreign debt, as a result of the economic hit men,

is equal to roughly 50 percent of its national budget. It cannot

possibly repay this debt, as is the case with so many third-world

countries.

 

So, now we go back to those countries and say, look, you borrowed all

this money from us, and you owe us this money, you can't repay your

debts, so give our oil companies your oil at very cheap costs. And in

the case of many of these countries, Ecuador is a good example here,

that means destroying their rain forests and destroying their

indigenous cultures. That's what we're doing today around the world,

and we've been doing it since the end of World War II. It has been

building up over time until today where it's really reached mammoth

proportions where we control most of the resources of the world.

 

Robert MacNamara, you write about him. Talk about his roles from Ford

to secretary of defense to World Bank.

 

I think that what we have here is a world empire that's controlled by

a very few men I call the " corporatocracy, " and these are the heads of

the big corporations, big banks and government, and they tend to be

the same person. They jump across these lines and MacNamara is a great

example of that. He was president of Ford and then he became secretary

of defense under Kennedy and Johnson and then he became president of

the World Bank. And in all three roles, his main job was to promote

American business, to promote the corporatocracy, to bring the goodies

home, to exploit the world. And he was in democratic regimes, Kennedy

and Johnson.

 

Today we've got Dick Cheney who's basically in the same picture. We

had George Schultz under the former President Bush. So, the two Bushes

both have these types of people, too. Condoleezza Rice. Government is

filled with these people.

 

But it is not just a Republican issue. It's a bipartisan issue. It

goes across all the lines, and MacNamara is a very good example of

that. I think, at the same time, MacNamara was one of the most

important people in terms of framing the new economics, what he called

aggressive management. It was aggressive about going out and basically

taking the world and bringing it into us so that today, out of the 100

largest economies in the world, 52 are corporations; 47 of them are

U.S. corporations – they're not countries, they're corporations.

 

What about Iran?

 

Iran is where economic hit men really get started because in the early

1950s, Iran democratically elected a man named Mossadeq as premier.

But as soon as he got into power, he went up against the oil

companies. And he really stood up for his people. And he said,

particularly British Petroleum, if you are going to be here, you are

going to give your fair share to our people.

 

The oil companies were very upset, so the United States made the

decision to go in and do something about this. Now, at the time, we

were terrified of thermonuclear war. Russia was the enemy after World

War II, and Iran is on the Russian border. So we didn't dare send in

troops to get rid of Mossadeq, but we've decided we have got to get

rid of him because he is opposing the oil companies.

 

Instead of sending in the troops, we sent in Kermit Roosevelt, a CIA

agent who happened to be Teddy's grandson, and we sent him in with a

few million dollars, and he managed to create riots, protest, havoc,

and to make a long story short, he overthrew Mossadeq, the premier,

and brought the Shah back into power. We all know about the Shah.

 

When you say everyone knows what happened there, I don't take that for

granted. What happened in Iran under the Shah?

 

We wanted desperately to control all the Middle Eastern oil. We saw

the Shah as being the person who could make this happen for us. The

plan was that the Shah would help take over the rest of the Middle

East, including Syria and Iraq, and we all know there was a war

between Iraq and Iran much later. But from the very beginning, the

idea was to become allies with the Shah. We did everything we could to

shore him up.

 

At the same time, we realized that he had a lot of oil money and so

our companies were benefiting tremendously. Once again, all those

engineering firms that we've talked about, my own, Charles T. Main,

and Bechtel and Halliburton, and everybody else who was in there

building cities, building power plants, building highways, getting

very, very, very rich. And we were making tremendous numbers of people

angry. Even to this day, Osama bin Laden cites what happened with the

Shah, how we overthrew Mossadeq and brought the Shah in, as one of the

reasons for his anger.

 

Oil is the source of so much pain.

 

Every country in the world that has major supplies of oil has

suffered. Oil is not a benefit for these countries. It's a benefit for

a few of the very wealthy people at the top of the economic totem pole

in these countries. But for everybody else, it's a curse. Oil is a

curse to the world. It's destroying our environment, it's destroyed a

lot of world economies, it's destroyed tremendous numbers of

indigenous people who are suffocating from the results of the carbon

dioxide that oil has produced.

 

You also were tied up in Saudi Arabia.

 

Saudi Arabia was our greatest success as economic hit men. I mean,

that's how we judge ourselves. In the early 1970s, OPEC really flexed

its muscle. It didn't like U.S. policies in Israel supporting Israel,

and decided to do something about it. So it shut down oil production

significantly. And as a result, the U.S. economy went into a tailspin.

There were long lines of cars at gas stations, many of us still

remember that. And we were afraid that it was going to be another

crash like 1929 as a result of OPEC.

 

And so the treasury department came to me and some other economic hit

men, and said 'this must never happen again. You have got to devise a

plan. What are you going to do about this? How can you make sure this

never happens?' And we knew the key was Saudi Arabia.

 

For one thing, it had more oil than anybody else. Even at that point

in time, the Shah was getting a little bit shaky, and we'd seen that

he wasn't probably going to take over the rest of the Middle East. We

knew that the House of Saud, the royal Saudi family, was corruptible.

They were corrupt, they are corrupt, and they were corruptible.

 

So, to make a long story short, we put together this deal whereby the

House of Saud agreed to send most of their petro dollars, the money we

paid for petroleum, back to the United States and invest it in U.S.

securities. The interest from those securities would be dealt out by

the treasury department to U.S. engineering construction firms to

build Saudi Arabia in the Western image, to build huge cities out of

the desert, which we've done – power plants, highways, McDonald's, the

whole works – to make Saudi Arabia a very westernized country.

 

And the House of Saud would guarantee to keep oil prices within limits

acceptable to us, and we would guarantee to keep the House of Saud in

power. And we have. All those things have followed since the early

1970s. The policy still holds. Even to the point where we know that

the House of Saud supports Osama bin Laden, supported him at our

encouragement, of course, in Afghanistan, continues to support him and

a lot of terrorist movements.

 

What was your personal involvement there?

 

I was one of the people that structured this plan. There were a number

of other people involved. And then we sent an envoy to Saudi Arabia –

I was never officially told who it was, but I'm almost positive it was

Henry Kissinger – to convince the House of Saud to accept our plan.

And the message came back to us that the House of Saud had accepted

the plan, but now a number of princes had to be convinced because even

though Saudi Arabia is not a democracy, apparently there was a certain

amount of democratic consensus building within the family, anyway.

 

So, I was assigned to one of the princes and told that I needed to

bring him around. He was a very, very strict conservative, Wahabi, and

he didn't really want to see his country become westernized. He saw

this coming. And so I knew my job was a challenge. He made it a little

easier for me, in some respects, because at the beginning, he let me

know that every time he came to Boston or I visited him in New York or

Washington, he would expect to have a companion, a beautiful

blue-eyed, blonde woman. And if I couldn't provide him with this, I

could forget about meeting with him.

 

It was one of the few illegal things that I did. Most of my job as an

economic hit man was, strictly speaking, legal. What we did to the

other countries should not be legal, but it is. Pimping is not legal.

So I was pimping in Massachusetts at the time, and the only way I

could pay for these services was by basically padding my expense

accounts, and that also is illegal.

 

And so what happened with this?

 

Well, eventually we worked it out whereby we provided him with a

blonde, blue-eyed woman from one of the Scandinavian countries. At

that time, there was a large trade in white traffic of women to the

Middle East, and we arranged for that for him. He became quite happy

with all this and eventually he agreed to the plan that we wanted. He

supported it. And the House of Saud completely supported it, and it

went into place.

 

You tried to write this book over several decades. What happened?

 

It always bothered my conscience, what I was doing, and I really

wanted to expose it because I didn't like what was going on in the

world, what I saw my country doing. I'm a very loyal American and I

believe very deeply in the principles of this country, the founding

fathers. And as time went on, I began to see how we were cheating

those principles, how we were distorting them, how we're losing our

sense of democracy almost completely and becoming such a capitalistic

corporatocracy-oriented country, a great empire, an imperialistic country.

 

Other empires have been created militarily and everybody in the

country knows the armies are going out there and creating empire. But

this one has been done so subtly that most Americans have no idea that

it is going on.

 

I knew deep in my heart I needed to write this book. I needed to

expose the truth behind what's going on in the world. I had a young

daughter. She was born in 1982. So during the 1990s, she was very

young. I was concerned about her safety and comfort, but I was also

concerned about her future. But I could justify constantly not writing

this book on many, many levels. And I was sworn to secrecy on it.

 

But when 9/11 struck, I was in the Amazon at the time. I went up to

New York a few weeks later and sat there and I could still smell the

burning flesh and see the smoke coming out of that hole, and I sat

there and I knew that I had to take responsibility for what had

happened there. I knew that I had to expose the truth because what

happened at Ground Zero is a direct result of the empire building, of

what we economic hit men did, and I knew as I sat there that if we

don't do something to change the course we're on in the world, my

daughter basically has no future and certainly her children don't.

 

This empire that we've created that's made so many people around the

planet angry, that's resulted in destitution for billions of people on

this planet: 24,000 people starve to death every day; 30,000 children

die every single day from lack of medicines for diseases that could be

cured and we have to take responsibility for that. We can change that

and we will change it. But we'll only change it when we really come to

understand what's going on.

 

Iraq: How does that fit in?

 

Well, Iraq followed Saudi Arabia. After our tremendous success in

Saudi Arabia, we decided we should do the same thing in Iraq. And we

figured that Saddam Hussein was corruptible. And, of course, we had

been involved with Saddam Hussein anyway for some time. And so the

economic hit men went in and tried to bring Saddam Hussein around,

tried to get him to agree to a deal like the royal House of Saud had

agreed to. And he didn't. So, we sent in the jackals to try to

overthrow him or to assassinate him. They couldn't. His Republican

Guard was too loyal and he had all these doubles.

 

So, when the economic hit men and the jackals both failed, then the

last line of defense that the United States, the empire, uses these

days, is the military. We send in our young men and women to die and

to kill, and we did that in Iraq in 1990. We thought Saddam Hussein at

that point was sufficiently chastised that now he would come around,

so the economic hit men went back in the 1990s, failed once again. The

jackals went back in, failed once again, and so once again the

military went in – the story we all know – because we couldn't bring

him around any other way.

 

Iraq had become very, very important to us for many reasons. Its

strategic location, the fact that it controls a great deal of the

water of the Middle East, the Tigris and Euphrates both flow through

and out of Iraq and, of course, its oil.

 

And now we're not so sure we can keep the House of Saud in control.

It's become extremely unpopular amongst its own people. Over 100

assassinations this year. We've been recently reading about the U.S.

Consulate being attacked in Saudi Arabia. The House of Saud is losing

control. It's very unpopular, partly because it accepted this deal

with the West. It did a lot like what the Shah of Iran has done. And

Osama bin Laden, of course, is very against it. But so are a

tremendous number of Muslims around the world. So we've been afraid

that we're going to lose the grip on the House of Saud. One way to

protect against that is by taking over Iraqi oil fields, which may be

larger than those in Saudi Arabia.

 

You work with a lot of people in other countries and right here in the

international financial institutions, for example, like the World

Bank. What understanding do they have? Do a lot of people feel the

same way you do?

 

Well, that's a good question. It's hard to answer for a lot of other

people. Within those organizations, most of the people don't realize

what's going on. The engineers at Bechtel and Halliburton and the

financial specialists at the World Bank and so on and so forth don't

really realize what's going on. They should. They ought to look into

it and find out. But there is every excuse not to on their part. They

do their jobs.

 

I'm struck by the fact that as I travel around the world how many

people in these countries, even people we consider illiterate,

question their government. They assume their government is corrupt,

they assume ours is corrupt, but we don't. It is amazing to me how

many of us don't, at least not openly. The fact is that Americans, for

the most part, don't really want to know what's going on. But we need

to. We really need to question that.

 

So within these organizations, you've got tremendous numbers of people

that are just going along with the system, getting paid really well to

do it, and getting jobs that they were trained to do. But then you

always have a number of people like me at the top of the organizations

who know what's going on. They are part of this and they use every

means they can to keep the system moving.

 

Amy Goodman is the host of the nationally syndicated radio news

program Democracy Now, where the entire transcript of this interview

is posted.