Conspiracy theories alleging the collusion of large multinational corporations with the spread of the new empire led by the now sole superpower seldom receive serious academic attention. These theories are often discredited as a figment of imagination of left-wing radicals still reeling under the shock of the demise of socialist regimes.
However, a recently-published book by someone who claims to have had first-hand involvement in shaping the policies of a number of developing countries, including Kuwait, Saudi Arabia, Iran, Indonesia, Colombia, Ecuador and Panama as an undercover agent for the US government and the recipients of large infrastructure contracts provides some useful insights into the modus operandi of collusion between big business and US government agencies in pursuit of extending the new empire’s global reach.
The book, entitled “Confessions of an Economic HiT Man” by John Perkins, sheds new light on the genesis of the present conflicts in the Middle East and shows that military adventures by the new empire are only a last resort to subdue a country.
The idea that corporate interests have undue influence over White House administrations is neither new nor unbelievable, but has grown in credence during the Bush administration, especially since the Iraq war.
According to a recent Gallup poll, 70 per cent of those questioned in the US said they believed that big business had too much influence over Bush administration decisions.
The existence of a thriving business in the heart of Washington D.C. on K Street, which has become synonymous with the corporate lobbying industry, testifies to this influence. The book vividly articulates how audaciously this influence is manifested in practice on a global scale.
Briefly, Perkins describes economic hit men (EHM) as “highly paid professionals who cheat countries around the globe out of trillions of dollars”. They funnel money from the World Bank, the US Agency for International Development (USAID), and other foreign “aid” organisations into the coffers of huge corporations and the pockets of a few wealthy families who control the planet’s natural resources.
Their tools include misleading financial and economic reports, rigged elections, besides payoffs, extortion, sex, and murder, which are more typical of James Bond-type cloak and dagger spy stories. “They play a game as old as empire, but one that has taken on new and terrifying dimensions during this time of globalisation.”
The Harvard Advisory Group (HAG) in Pakistan in 1960s was one of the early proto-types from which a nucleus of “EHM” emerged. In particular, Richard Gilbert, the field supervisor of the project, developed a close relationship with President Ayub Khan, who honoured him with one of the highest civilian awards, Sitara-i-Pakistan, on the Independence Day in 1965. He was instrumental in making Pakistan a firm ally of the US in the cold war and in inducing it to follow a foreign-aid dependent development strategy.
The EHM came into being after a realisation that military and CIA-type operation needed to be supplemented by direct involvement of (pseudo) professionals who would seduce third world rulers into embarking on ambitious development plans funded by multilateral lenders which would provide multi-billion contracts to mega-multinationals like Bechtel, Haliburtron, GE, GM and Enron.
These loans were to be largely used for the benefit of elites and for greasing the palms of the bureaucracy, military and the politicians, creating an unbreakable dependency on the empire and its financial institutions. Mr Perkins calls this evil nexus “corporatocracy”.
Interestingly enough, the former CEOs of these large corporations, like McNamara (GM), George Shulcz (Bechtel) and Richard Cheney (Haliburton) have served high executive offices in the US Administration in recent decades.
The archetype of the EHM was Kermit Roosevelt, a grandson of President Theodore (not Franklin) Roosevelt, who was sent to Iran as a CIA agent to topple the regime of Prime Minister Mossadegh in August1953 for trying to nationalise the oil industry and overthrow the Shah.
“I owe my throne to God, my people, my army - and to you,” said a sobbing and grateful Shah of Iran to Kermit Roosevelt after being restored to the Peacock Throne.
Since the Mossadegh affair, American corporations and government agencies employ two types of operatives: “economic hit men,” who bribe emerging economies, and “jackals,” who may be used to overthrow or even murder heads of state in Latin America and the Middle East to serve the greater cause of American empire.
The EHM were recruited by CIA and the NSA and assigned to work for private consulting companies, engineering firms and construction companies, to provide them a cover. Even the role of the “jackals”, formerly performed directly by CIA, is now sub-contracted to private sector, to avoid Congressional scrutiny.
Perkins entered the service of EHM after cutting his teeth in the Peace Corps in Ecuador, working with the indigenous farming population, an ideal internship opportunity for his future career. Simultaneously, he interviewed with the National Security Agency and then became an economic forecaster, with the pretentious title of Chief Economist (although he had only a Bachelor’s degree from Boston University and a minimal training in economics) with a major consulting company called Chas. T. Main, based in Boston.
Perkins joined this international network in the wake of the first oil shock, after the formation of Opec in the 1960s largely to challenge the power of “big oil” companies which set extremely low prices for crude oil. His work in Saudi Arabia is particularly revealing, because of the construction boom the oil shock spawned as a result of the enormous rise in oil prices.
Helping shape the US – relations was the EHM’s main task during that period that became pivotal to avoiding a serious recession in the US and the world economy after the 1973 oil shock, which raised the price of crude oil from $1.30 on January 1, 1970 to $8.32 on January 1, 1974.
The US immediately realised that Saudi Arabia had to play a key role if the oil cartel’s back had to be broken and if the use of the oil weapon resorted to by Arab countries in the Yom Kippur war had to be banished for good. Simultaneously, the US raised its military aid to Israel to $3 billion and set forth an arms race which would absorb a large part of the increased oil proceeds of the Arab world.
Almost as soon as the oil embargo ended in March, 1974, the United States started negotiations with Saudi Arabia to provide it technical and military support, both for its internal and external security and to transform the medieval nomadic nation into a modern economy. These negotiations led to the creation of a powerful collaborative institution called Joint Economic Commission JECOR (much wider in scope than, for instance, the Harvard Advisory Group in Pakistan) with overall management and responsibility delegated to the US Department of Treasury.
The unwritten job description of the EHM working in the commission as employees of various consultancy firms was “to maximise payouts to US firms and to make Saudi Arabia increasingly dependent on the United States.”
The Royal House of Saud agreed to play a dual role to help the US economy in exchange for keeping it in power – the threat of Mossadegh’s fate hanging over its head as a sword of Democles, in case of non-compliance.
First, in its role as a “swing producer” it would agree to maintain the price of oil within acceptable limits by pumping more oil, often in excess of Opec’s agreed quota. Secondly, it would send most of its petro-dollars back to the United States and invest them in US government securities.
The US Treasury Department would use the interest from these securities to hire US companies to build Saudi Arabia–new cities, new infrastructure. This strategy not only kept Saudi Arabia under a tight US leash, it also provided a great fillip to economic growth in the US which had started decelerating in the 1970s.
Saudi Arabia’s economic development in the 1970s also spawned the growth of defence-related industry which increased its dependence on the United States to defend itself from possible backlash against modernisation within the country and the fear of such unfriendly neighbours as Iran and Iraq.
This dramatically increased the expenditure not only on expensive military hardware supplied by the US firms but also the construction of airports, missile sites, radar stations and military bases which provided lucrative contracts to the US companies.
This ingenious method of recycling petrodollars and converting the oil shock into a bonanza for the US corporates was, according to Perkins, quipped by insiders as the Saudi Arabian Money-laundering Affair (SAMA) with a pun on the initials of the Saudi central bank.
Perkins shows that the seeds of the Bin Laden insurgency, two decades after he decided to give up the role of an EHM, were sown by the way the US and other western oil and infrastructure contracts cashed in on the opportunity. Saudi Arabia was hardly the only fertile ground for EHMs to prosper. Latin America and East Asia also figure prominently in Perkin’s confessional account. In fact an earlier version of the book was dedicated to the Ecuador president Jaime Roldós and Panama’s president, Omar Torrijos, who died in mysterious air crashes in the 1980s.
According to Perkins, when we economic hit men failed to bring Roldós and Torrijos around, and the other type of hit men, the CIA-sanctioned jackals who were always right behind us, stepped in.” Perhaps, General Ziaul Haq’s exit from this world 18 years ago could also be explained in similar terms.
No one knows where the EHM will strike next. But after oil, it is water that is being targeted for privatization by the corporations with the help of the World Bank and the IMF.
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