'Confessions of an Economic Hit Man'

Memo To: Website Fans, Browsers, Clients From: Jude Wanniski Re: A Book About the Evil Empire If you happened to glance at the NYTimes Book Review today, you might have noticed a book on the best-seller list for the first time, in ninth place. The blurb tells us: u201CConfessions of an Economic Hit Man, by John Perkins. (Barrett-Koehler, $14.97.) A former employee of an international consulting firm denounces the American global empire and its u2018corporatocracy.'u201D What's this all about? The book was published last fall, but only now shows up as a best-seller? It only recently was brought to my attention by a website fan who knows I've long argued that the International Monetary Fund and its sister organization, the World Bank, constitute an u201CEvil Empire.u201D The two u201Cinternational financial institutionsu201D (IFI's) were founded in 1945 during the genesis of the United Nations as u201Cdo-goodu201D enterprises. The IMF would assist countries trying to keep their currencies tied to the dollar under the terms of the 1944 Bretton Woods Agreement. The World Bank would lend money at low interest rates gathered from the rich countries to help poor countries get off their backs.

Over the years, the process has been corrupted, with both the IMF and World Bank becoming controlled by the multinational corporations and their banks. When President Nixon went off the gold standard in 1971, the IMF's reason for existence evaporated, because Bretton Woods and the fixed dollar went up in smoke. Now the problem for the big banks like Chase Manhattan, Citicorp and the Bank of America became two-fold:

1) As surplus dollars accumulated in their reserves and there were no credit-worthy Americans wanting to borrow, the banks had to think of ways to lend the money abroad or it would sit in their vaults earning zip, which means it really is losing money as the paper dollar — freed from its gold anchor — was inflating and losing purchasing power. Citigroup's Walter Wriston (who died last week) came up with the idea that the surplus should be loaned to poor countries, even though they had no collateral, because governments had to pay off their hard-currency loans or lose their international credit ratings.

2) If the countries that borrowed from Chase or Citicorp could not pay back interest or principle and did not worry about stiffing the private bankers, they would have to swallow the non-performing loans. The solution was to have the IMF, looking for something to justify its existence, step in to collect the debt. All it had to do was persuade the U.S. Congress to ante up billion or two of taxpayer dollars to fill their coffers (and u201Creplenishu201D them from time to time). They could then go to the deadbeat country and say, u201CWe will give you this money so you can pay Chase and Citicorp what you owe them, but you will have to raise taxes on your own people and devalue your currency as the conditions for the loan! What we have in this book from Mr. Perkins is an account of a foot soldier in these operations of the Evil Empire. I'll get his book and check it out, but from what I can gather about it on the Internet he is well within the ballpark of what has been going on. Are bankers evil by nature? Of course not. But as bankers they follow the money, not giving a second thought to the conditions in which they leave their debtors. The first priority of any institution is self-preservation, and for the big banks, that means getting paid back on their loans. Is this any way to run the world? No. It is a dreadful way to operate, and it would end if our government returned to a dollar/gold system and abided by it. If not, I'm afraid nothing Mr. Perkins writes or that I write will change a thing. The folks who control the money control our government and that's that. It is interesting that Perkins does identify the Bechtel Corporation and Halliburton as agents in this quiet conspiracy to make sure the good old USA flourishes, even though it means the relentless impoverishment of the poorest countries of the world.

Here is an interview that Amy Goodman of “Democracy Now” had with Perkins on November 9 last year. Remember his perspective is not from the highest level, but note he mentions George Shultz as an agent of the Evil Empire, which Shultz has been for decades. It was Shultz who, with Walter Wriston and Milton Friedman, persuaded Nixon to float the dollar and blow up the Bretton Woods monetary system. Shultz, now an octagenarian, is still a power in the Establishment, a key player at the Bechtel Corporation and a member of the Pentagon’s Defense Policy Board, a member of the Perle Cabal. Of course, the three men – thought it was the right thing to do at the time, but in retrospect it wasn't.