[BITList] An Economic Hit Man Speaks Out

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*John Perkins on How Greece Has Fallen Victim to "Economic Hit Men" *

Thursday, 11 September 2014 00:00 /By Michael Nevradakis 
<http://www.truth-out.org/author/itemlist/user/48720>, Truthout | 
Interview /

*"My sin was ripping off people around the world," said John Perkins, 
author of "Confessions of an Economic Hit Man," at Transitions Bookplace 
in Chicago, on February 3, 2006. (Photo: Peter Thompson / The New York 
Times)*/John Perkins, author of /Confessions of an Economic Hit Man/, 
discusses how Greece and other eurozone countries have become the new 
victims of "economic hit men."/

John Perkins is no stranger to making confessions. His well-known book, 
/Confessions of an Economic Hit Man/, revealed how international 
organizations such as the International Monetary Fund (IMF) and the 
World Bank, while publicly professing to "save" suffering countries and 
economies, instead pull a bait-and-switch on their governments: 
promising startling growth, gleaming new infrastructure projects and a 
future of economic prosperity - all of which would occur if those 
countries borrow huge loans from those organizations. Far from achieving 
runaway economic growth and success, however, these countries instead 
fall victim to a crippling and unsustainable debt burden.

That's where the "economic hit men" come in: seemingly ordinary men, 
with ordinary backgrounds, who travel to these countries and impose the 
harsh austerity policies prescribed by the IMF and World Bank as 
"solutions" to the economic hardship they are now experiencing. Men like 
Perkins were trained to squeeze every last drop of wealth and resources 
from these sputtering economies, and continue to do so to this day. In 
this interview, which aired on Dialogos Radio, Perkins talks about how 
Greece and the eurozone have become the new victims of such "economic 
hit men."

*Michael Nevradakis: In your book, you write about how you were, for 
many years, a so-called "economic hit man." Who are these economic hit 
men, and what do they do?*

*John Perkins:*Essentially, my job was to identify countries that had 
resources that our corporations want, and that could be things like oil 
- or it could be markets - it could be transportation systems. There're 
so many different things. Once we identified these countries, we 
arranged huge loans to them, but the money would never actually go to 
the countries; instead it would go to our own corporations to build 
infrastructure projects in those countries, things like power plants and 
highways that benefitted a few wealthy people as well as our own 
corporations, but not the majority of people who couldn't afford to buy 
into these things, and yet they were left holding a huge debt, very much 
like what Greece has today, a phenomenal debt.

*"[Indebted countries] become servants to what I call the corporatocracy 
... today we have a global empire, and it's not an American empire. It's 
not a national empire ... It's a corporate empire, and the big 
corporations rule."*

And once [they were] bound by that debt, we would go back, usually in 
the form of the IMF - and in the case of Greece today, it's the IMF and 
the EU [European Union] - and make tremendous demands on the country: 
increase taxes, cut back on spending, sell public sector utilities to 
private companies, things like power companies and water systems, 
transportation systems, privatize those, and basically become a slave to 
us, to the corporations, to the IMF, in your case to the EU, and 
basically, organizations like the World Bank, the IMF, the EU, are tools 
of the big corporations, what I call the "corporatocracy."

*And before turning specifically to the case of Greece, let's talk a 
little bit more about the manner in which these economic hit men and 
these organizations like the IMF operate. You mentioned, of course, how 
they go in and they work to get these countries into massive debt, that 
money goes in and then goes straight back out. You also mentioned in 
your book these overly optimistic growth forecasts that are sold to the 
politicians of these countries but which really have no resemblance to 
reality.*

Exactly, we'd show that if these investments were made in things like 
electric energy systems that the economy would grow at phenomenally high 
rates. The fact of the matter is, when you invest in these big 
infrastructure projects, you do see economic growth, however, most of 
that growth reflects the wealthy getting wealthier and wealthier; it 
doesn't reflect the majority of the people, and we're seeing that in the 
United States today.

*"In the case of Greece, my reaction was that 'Greece is being hit.' 
There's no question about it."*

For example, where we can show economic growth, growth in the GDP, but 
at the same time unemployment may be going up or staying level, and 
foreclosures on houses may be going up or staying stable. These numbers 
tend to reflect the very wealthy, since they have a huge percentage of 
the economy, statistically speaking. Nevertheless, we would show that 
when you invest in these infrastructure projects, your economy does 
grow, and yet, we would even show it growing much faster than it ever 
conceivably would, and that was only used to justify these horrendous, 
incredibly debilitating loans.

*Is there a common theme with respect to the countries typically 
targeted? Are they, for instance, rich in resources or do they typically 
possess some other strategic importance to the powers that be?*

Yes, all of those. Resources can take many different forms: One is the 
material resources like minerals or oil; another resource is strategic 
location; another resource is a big marketplace or cheap labor. So, 
different countries make different requirements. I think what we're 
seeing in Europe today isn't any different, and that includes Greece.

*What happens once these countries that are targeted are indebted? How 
do these major powers, these economic hit men, these international 
organizations come back and get their "pound of flesh," if you will, 
from the countries that are heavily in debt?*

By insisting that the countries adopt policies that will sell their 
publicly owned utility companies, water and sewage systems, maybe 
schools, transportation systems, even jails, to the big corporations. 
Privatize, privatize. Allow us to build military bases on their soil. 
Many things can be done, but basically, they become servants to what I 
call the corporatocracy. You have to remember that today we have a 
global empire, and it's not an American empire. It's not a national 
empire. It doesn't help the American people very much. It's a corporate 
empire, and the big corporations rule. They control the politics of the 
United States, and to a large degree they control a great deal of the 
policies of countries like China, around the world.

*John, looking specifically now at the case of Greece, of course you 
mentioned your belief that the country has become the victim of economic 
hit men and these international organizations . . . what was your 
reaction when you first heard about the crisis in Greece and the 
measures that were to be implemented in the country?*

I've been following Greece for a long time. I was on Greek television. A 
Greek film company did a documentary called "Apology of an Economic Hit 
Man," and I also spent a lot of time in Iceland and in Ireland. I was 
invited to Iceland to help encourage the people there to vote on a 
referendum not to repay their debts, and I did that and encouraged them 
not to, and they did vote no, and as a result, Iceland is doing quite 
well now economically compared to the rest of Europe. Ireland, on the 
other hand: I tried to do the same thing there, but the Irish people 
apparently voted against the referendum, though there's been many 
reports that there was a lot of corruption.

*"That's part of the game: convince people that they're wrong, that 
they're inferior. The corporatocracy is incredibly good at that."*

In the case of Greece, my reaction was that "Greece is being hit." 
There's no question about it. Sure, Greece made mistakes, your leaders 
made some mistakes, but the people didn't really make the mistakes, and 
now the people are being asked to pay for the mistakes made by their 
leaders, often in cahoots with the big banks. So, people make tremendous 
amounts of money off of these so-called "mistakes," and now, the people 
who didn't make the mistakes are being asked to pay the price. That's 
consistent around the world: We've seen it in Latin America. We've seen 
it in Asia. We've seen it in so many places around the world.

*This leads directly to the next question I had: From my observation, at 
least in Greece, the crisis has been accompanied by an increase in 
self-blame or self-loathing; there's this sentiment in Greece that many 
people have that the country failed, that the people failed . . . 
there's hardly even protest in Greece anymore, and of course there's a 
huge "brain drain" - there's a lot of people that are leaving the 
country. Does this all seem familiar to you when comparing to other 
countries in which you've had personal experience?*

Sure, that's part of the game: convince people that they're wrong, that 
they're inferior. The corporatocracy is incredibly good at that, whether 
it is back during the Vietnam War, convincing the world that the North 
Vietnamese were evil; today it's the Muslims. It's a policy of them 
versus us: We are good. We are right. We do everything right. You're 
wrong. And in this case, all of this energy has been directed at the 
Greek people to say "you're lazy; you didn't do the right thing; you 
didn't follow the right policies," when in actuality, an awful lot of 
the blame needs to be laid on the financial community that encouraged 
Greece to go down this route. And I would say that we have something 
very similar going on in the United States, where people here are being 
led to believe that because their house is being foreclosed that they 
were stupid, that they bought the wrong houses; they overspent themselves.

*"We know that austerity does not work in these situations."*

The fact of the matter is their bankers told them to do this, and around 
the world, we've come to trust bankers - or we used to. In the United 
States, we never believed that a banker would tell us to buy a $500,000 
house if in fact we could really only afford a $300,000 house. We 
thought it was in the bank's interest not to foreclose. But that changed 
a few years ago, and bankers told people who they knew could only afford 
a $300,000 house to buy a $500,000 house.

"Tighten your belt, in a few years that house will be worth a million 
dollars; you'll make a lot of money" . . . in fact, the value of the 
house went down; the market dropped out; the banks foreclosed on these 
houses, repackaged them, and sold them again. Double whammy. The people 
were told, "you were stupid; you were greedy; why did you buy such an 
expensive house?" But in actuality, the bankers told them to do this, 
and we've grown up to believe that we can trust our bankers. Something 
very similar on a larger scale happened in so many countries around the 
world, including Greece.

*In Greece, the traditional major political parties are, of course, 
overwhelmingly in favor of the harsh austerity measures that have been 
imposed, but also we see that the major business and media interests are 
also overwhelmingly in support. Does this surprise you in the slightest?*

No, it doesn't surprise me and yet it's ridiculous because austerity 
does not work. We've proven that time and time again, and perhaps the 
greatest proof was the opposite, in the United States during the Great 
Depression, when President Roosevelt initiated all these policies to put 
people back to work, to pump money into the economy. That's what works. 
We know that austerity does not work in these situations.

*"What I didn't realize during any of this period was how much 
corporatocracy does not want a united Europe."*

We also have to understand that, in the United States for example, over 
the past 40 years, the middle class has been on the decline on a real 
dollar basis, while the economy has been increasing. In fact, that's 
pretty much happened around the world. Globally, the middle class has 
been in decline. Big business needs to recognize - it hasn't yet, but it 
needs to recognize - that that serves nobody's long-term interest, that 
the middle class is the market. And if the middle class continues to be 
in decline, whether it's in Greece or the United States or globally, 
ultimately businesses will pay the price; they won't have customers. 
Henry Ford once said: "I want to pay all my workers enough money so they 
can go out and buy Ford cars." That's a very good policy. That's wise. 
This austerity program moves in the opposite direction and it's a 
foolish policy.

*In your book, which was written in 2004, you expressed hope that the 
euro would serve as a counterweight to American global hegemony, to the 
hegemony of the US dollar. Did you ever expect that we would see in the 
European Union what we are seeing today, with austerity that is not just 
in Greece but also in Spain, Portugal, Ireland, Italy, and also several 
other countries as well?*

What I didn't realize during any of this period was how much 
corporatocracy does not want a united Europe. We need to understand 
this. They may be happy enough with the euro, with one currency - they 
are happy to a certain degree by having it united enough that markets 
are open - but they do not want standardized rules and regulations. 
Let's face it, big corporations, the corporatocracy, take advantage of 
the fact that some countries in Europe have much more lenient tax laws, 
some have much more lenient environmental and social laws, and they can 
pit them against each other.

*"[Rafael Correa] ... has to be aware that if you stand up too strongly 
against the system, if the economic hit men are not happy, if they don't 
get their way, then the jackals will come in and assassinate you or 
overthrow you in a coup."*

What would it be like for big corporations if they didn't have their tax 
havens in places like Malta or other places? I think we need to 
recognize that what the corporatocracy saw at first, the solid euro, a 
European union seemed like a very good thing, but as it moved forward, 
they could see that what was going to happen was that social and 
environmental laws and regulations were going to be standardized. They 
didn't want that, so to a certain degree what's been going on in Europe 
has been because the corporatocracy wants Europe to fail, at least on a 
certain level.

*You wrote about the examples of Ecuador and other countries, which 
after the collapse of oil prices in the late '80s found themselves with 
huge debts and this, of course, led to massive austerity measures . . . 
sounds all very similar to what we are now seeing in Greece. How did the 
people of Ecuador and other countries that found themselves in similar 
situations eventually resist?*

Ecuador elected a pretty remarkable president, Rafael Correa, who has a 
PhD in economics from a United States university. He understands the 
system, and he understood that Ecuador took on these debts back when I 
was an economic hit man and the country was ruled by a military junta 
that was under the control of the CIA and the US. That junta took on 
these huge debts, put Ecuador in deep debt; the people didn't agree to 
that. When Rafael Correa was democratically elected, he immediately 
said, "We're not paying these debts; the people did not take on these 
debts; maybe the IMF should pay the debts and maybe the junta, which of 
course was long gone - moved to Miami or someplace - should pay the 
debts, maybe John Perkins and the other economic hit men should pay the 
debts, but the people shouldn't."

And since then, he's been renegotiating and bringing the debts way down 
and saying, "We might be willing to pay some of them." That was a very 
smart move; it reflected similar things that had been done at different 
times in places like Brazil and Argentina, and more recently, following 
that model, Iceland, with great success. I have to say that Correa has 
had some real setbacks since then . . . he, like so many presidents, has 
to be aware that if you stand up too strongly against the system, if the 
economic hit men are not happy, if they don't get their way, then the 
jackals will come in and assassinate you or overthrow you in a coup. 
There was an attempted coup against him; there was a successful coup in 
a country not too far away from him, Honduras, because these presidents 
stood up.

We have to realize that these presidents are in very, very vulnerable 
positions, and ultimately we the people have to stand up, because 
leaders can only do a certain amount. Today, in many places, leaders are 
not just vulnerable; it doesn't take a bullet to bring down a leader 
anymore. A scandal - a sex scandal, a drug scandal - can bring down a 
leader. We saw that happen to Bill Clinton, to Strauss-Kahn of the IMF; 
we've seen it happen a number of times. These leaders are very aware 
that they are in very vulnerable positions: If they stand up or go 
against the status quo too strongly, they're going to be taken out, one 
way or another. They're aware of that, and it behooves we the people to 
really stand up for our own rights.

*You mentioned the recent example of Iceland . . . other than the 
referendum that was held, what other measures did the country adopt to 
get out of this spiral of austerity and to return to growth and to a 
much more positive outlook for the country?*

It's been investing money in programs that put people back to work and 
it's also been putting on trial some of the bankers that caused the 
problems, which has been a big uplift in terms of morale for the people. 
So Iceland has launched some programs that say "No, we're not going to 
go into austerity; we're not going to pay back these loans; we're going 
to put the money into putting people back to work," and ultimately 
that's what drives an economy, people working. If you've got high 
unemployment, like you do in Greece today, extremely high unemployment, 
the country's always going to be in trouble. You've got to bring down 
that unemployment, you've got to hire people. It's so important to put 
people back to work. Your unemployment is about 28 percent; it's 
staggering, and disposable income has dropped 40 percent and it's going 
to continue to drop if you have high unemployment. So, the important 
thing for an economy is to get the employment up and get disposable 
income back up, so that people will invest in their country and in goods 
and services.

*In closing, what message would you like to share with the people of 
Greece, as they continue to experience and to live through the very 
harsh results of the austerity policies that have been implemented in 
the country for the past three years?*

I want to draw upon Greece's history. You're a proud, strong country, a 
country of warriors. The mythology of the warrior to some degree comes 
out of Greece, and so does democracy! And to realize that the 
marketplace is a democracy today, and how we spend our money is casting 
our ballot. Most political democracies are corrupt, including that of 
the United States. Democracy is not really working on a governmental 
basis because the corporations are in charge. But it is working on a 
market basis. I would encourage the people of Greece to stand up: Don't 
pay off those debts; have your own referendums; refuse to pay them off; 
go to the streets and strike.

And so, I would encourage the Greek people to continue to do this. Don't 
accept this criticism that it's your fault, you're to blame, you've got 
to suffer austerity, austerity, austerity. That only works for the rich 
people; it does not work for the average person or the middle class. 
Build up that middle class; bring employment back; bring disposable 
income back to the average citizen of Greece. Fight for that; make it 
happen; stand up for your rights; respect your history as fighters and 
leaders in democracy, and show the world!

/The podcast of the original interview as it aired on Dialogos Radio is 
available at dialogosradio.org <http://dialogosradio.org/>./

*Copyright, Truthout. ***

*Michael Nevradakis <http://www.truth-out.org/author/itemlist/user/48720>*

*Michael Nevradakis is a Ph.D. student in media studies at the 
University of Texas at Austin and a US Fulbright Scholar presently based 
in Athens, Greece. Michael is also the host of Dialogos Radio, a weekly 
radio program featuring interviews and coverage of current events in 
Greece.*

Some interesting commentary. Remember what happened to Cyprus…

B.


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