The New Confessions of an Economic Hit Man

by John Perkins

  The Shuar formed Ecuador’s first line of defense. They proved themselves to be ferocious fighters, often overcoming superior numbers and better-equipped forces. The Shuar did not know anything about the politics behind the war or that its resolution would open the door to oil companies. They fought because they come from a long tradition of warriors and because they were not about to allow foreign soldiers onto their lands.

  As we paddled down the river, watching a flock of chattering parrots fly overhead, I asked Shakaim whether the truce was still holding.

  “Yes,” he said, “but I’m afraid I must tell you that we are now preparing to go to war with you.” He went on to explain that, of course, he did not mean me personally or the people in our group. “You are our friends,” he assured me. He was, he said, referring to our oil companies and to the military forces that would come into his jungle to defend them.

  “We’ve seen what they did to the Huaorani. They destroyed their forests, polluted the rivers, and killed many people, including children. Today, the Huaorani hardly exist as a people anymore. We won’t let that happen to us. We won’t allow oil companies into our territory, any more than we would the Peruvians. We have all sworn to fight to the last man.”1

  That night our group sat around a fire in the center of a beautiful Shuar longhouse built from split bamboo slats placed in the ground and covered with a thatched roof. I told them about my conversation with Shakaim. We all wondered how many other people in the world felt similarly about our oil companies and our country. How many, like the Shuar, were terrified that we would come into their lives and destroy their culture and their lands? How many hated us?

  The next morning, I went down to the little office where we kept our two-way radio. I needed to arrange for pilots to fly in and pick us up in a few days. As I was talking with them, I heard a shout.

  “My God!” the man on the other end of the radio exclaimed. “New York is under attack.” He turned up the commercial radio that had been playing music in the background. During the next half hour, we received a minute-by-minute account of the events unfolding in the United States. Like everyone else, I shall never forget that experience.

  When I returned to my home in Florida, I knew I had to visit Ground Zero, the former site of the World Trade Center towers, so I arranged to fly to New York. I checked into my uptown hotel in early afternoon. It was a sunny November day, unseasonably balmy. I strolled along Central Park, filled with enthusiasm, then headed for a part of the city where once I had spent a lot of time.

  As I approached Ground Zero, my enthusiasm was replaced with a sense of horror. The sights and smells were overwhelming — the incredible destruction; the twisted and melted skeletons of those once-great buildings; the debris; the rancid odor of smoke, charred ruins, and what I took to be burnt flesh. I had seen it all on TV, but being here was different.

  I had not been prepared for this — especially not for the people. They stood around, those who lived or worked nearby, those who had survived. An Egyptian man was loitering outside his small shoe repair shop, shaking his head in disbelief.

  “Can’t get used to it,” he muttered. “I lost many customers, many friends. My nephew died up there.” He pointed at the blue sky. “I think I saw him jump. I don’t know. . . . So many were jumping, holding hands and flapping their arms as though they could fly.”

  It came as a surprise, the way people talked with one another. In New York City. And it went beyond language. Their eyes met. Although somber, they exchanged looks of compassion, half-smiles that spoke more than a million words.

  But there was something else, a sense about the place itself. At first, I couldn’t figure it out; then it struck me: the light. Lower Manhattan had been a dark canyon, back in the days when I made the pilgrimage to this part of town to raise capital for IPS, when I used to plot strategy with my investment bankers over dinner at Windows on the World. You had to go that high, to the top of the World Trade Center, if you wanted to see light. Now, here it was at street level. The canyon had been split wide open, and we who stood on the street beside the ruins were warmed by the sunshine. I couldn’t help wondering if the view of the sky, of the light, had helped people open their hearts. I felt guilty just thinking such thoughts.

  I turned the corner at Trinity Church and headed down Wall Street. Back to the old New York, enveloped in shadow. No sky, no light. People hurried along the sidewalk, ignoring one another. A cop screamed at a stalled car.

  I sat down on the first steps I came to, at number fourteen. From somewhere, the sounds of giant fans or an air blower rose above the other noises. It seemed to come from the massive stone wall of the New York Stock Exchange building. I watched the people. They hustled up and down the street, leaving their offices, hurrying home, or heading to a restaurant or bar to discuss business. A few walked in tandem and chatted with each other. Most, though, were alone and silent. I tried to make eye contact; it didn’t happen.

  The wail of a car alarm drew my attention down the street. A man rushed out of an office and pointed a key at the car; the alarm went silent. I sat there quietly for a few long moments. After a while, I reached into my pocket and pulled out a neatly folded piece of paper covered with statistics.

  Then I saw him. He shuffled along the street, staring down at his feet. He had a scrawny gray beard and wore a grimy overcoat that looked especially out of place on this warm afternoon on Wall Street. He looked to be Afghan.

  He glanced at me. Then, after only a second of hesitation, he started up the steps. He nodded politely and sat down beside me, leaving a yard or two between us. From the way he looked straight ahead, I realized it would be up to me to begin the conversation.

  “Nice afternoon.”

  “Beautiful.” His accent was thick. “Times like these, we want sunshine.”

  “You mean because of the World Trade Center?”

  He nodded.

  “You’re from Afghanistan?”

  He stared at me. “Is it so obvious?”

  “I’ve traveled a lot. Recently, I visited the Himalayas, Kashmir.”

  “Kashmir.” He pulled at his beard. “Fighting.”

  “Yes, India and Pakistan, Hindus and Muslims. Makes you wonder about religion, doesn’t it?”

  His eyes met mine. They were deep brown, nearly black. They struck me as wise and sad. He turned back toward the New York Stock Exchange building. With a long gnarled finger, he pointed at the building.

  “Or maybe,” I agreed, “it’s about economics, not religion.”

  “You were a soldier?”

  I couldn’t help but chuckle. “No. An economic consultant.” I handed him the paper with the statistics. “These were my weapons.”

  He reached over and took the paper. “Numbers.”

  “World statistics.”

  He studied the list, then gave a little laugh. “I can’t read.” He handed it back to me.

  “The numbers tell us that twenty-four thousand people die every day from hunger.” I didn’t bother to mention that slightly fewer than three thousand had died at Ground Zero on 9/11.

  He whistled softly, then took a moment to think about this, and sighed. “I was almost one of them. I had a little pomegranate farm near Kandahar. Russians arrived and mujahideen hid behind trees and in water ditches.” He raised his hands and pointed them like a rifle. “Ambushing.” He lowered his hands. “All my trees and ditches were destroyed.”

  “After that, what did you do?”

  He nodded at the list I held. “Does it show beggars?”

  It did not, but I thought I remembered. “About eighty million in the world, I believe.”

  “I was one.” He shook his head, seemed lost in thought. We sat in silence for a few minutes before he spoke again. “I do not like beggaring. My child dies. So I raise poppies.”

  “Opium?”

  He shrugged. “No trees, no water. The only way to feed our families.”

  I felt a lump in my throat, a depres
sing sense of sadness combined with guilt. “We call raising opium poppies evil, yet many of our wealthiest people owe their fortunes to the drug trade.”

  His eyes met mine and seemed to penetrate my soul. “You were a soldier,” he stated, nodding his head to confirm this simple fact. Then he rose slowly to his feet and hobbled down the steps. I wanted him to stay, but I felt powerless to say anything. I managed to get to my feet and start after him. At the bottom of the steps I was stopped by a sign. It included a picture of the building where I had been seated. At the top, it notified passersby that the sign had been erected by Heritage Trails of New York. It said:

  The Mausoleum of Halicarnassus piled on top of the bell tower of St. Mark’s in Venice, at the corner of Wall and Broad — that’s the design concept behind 14 Wall Street. In its day the world’s tallest bank building, the 539-foot-high skyscraper originally housed the headquarters of Bankers Trust, one of the country’s wealthiest financial institutions.

  I stood there in awe and looked up at this building. Shortly after the turn of the last century, 14 Wall Street had played the role that the World Trade Center would later assume; it had been the very symbol of power and economic domination. It had also housed Bankers Trust, one of the firms I had employed to finance my energy company. It was an essential part of my heritage — the heritage, as the old Afghan man had so aptly put it, of a soldier.

  That I had ended up here this day, talking with him, seemed an odd coincidence. Coincidence. The word stopped me. I thought about how our reactions to coincidences mold our lives. How should I react to this one?

  Continuing to walk, I scanned the heads in the crowd, but I could find no sign of the man. At the next building, there was an immense statue shrouded in blue plastic. An engraving on the building’s stone face revealed that this was Federal Hall, 26 Wall Street, where on April 30, 1789, George Washington had taken the oath of office as first president of the United States. This was the exact spot where the first man given the responsibility to safeguard life, liberty, and the pursuit of happiness for all people was sworn in. So close to Ground Zero; right onWall Street.

  I went on around the block, to Pine Street. There I came face-to-face with the world headquarters of Chase, the bank that David Rockefeller built, a bank seeded with oil money and harvested by men like me. This bank, an institution that served the EHMs and that was a master at promoting global empire, was in many ways the very symbol of the corporatocracy.

  I recalled reading that the World Trade Center was a project started by David Rockefeller in 1960, and that in recent years the complex had been considered an albatross. It had the reputation of being a financial misfit, unsuited to modern fiber-optic and Internet technologies, and burdened with an inefficient and costly elevator system. Those two towers once had been nicknamed David and Nelson (Rockefeller). Now the albatross was gone.

  I kept walking, slowly, almost reluctantly. Despite the warmth of the afternoon, I felt a chill, and I realized that a strange anxiousness, a foreboding, had taken hold of me. I could not identify its source and I tried to brush it off, picking up my pace. I eventually found myself once again looking at that smoldering hole, the twisted metal, that great scar in the earth. I leaned against a building that had escaped the destruction and stared into the pit. I tried to imagine the people rushing out of the collapsing tower and the firefighters dashing in to help them. I tried to think about the people who had jumped, the desperation they felt. But none of these things came to me.

  Instead, I saw Osama bin Laden accepting money, and weapons worth millions of dollars, from a man employed by a consulting company under contract to the United States government. Then I saw myself sitting at a computer with a blank screen.

  I looked around, away from Ground Zero, at the New York streets that had avoided the fire and now were returning to normal. I wondered what the people who walked those streets today thought about all this — not simply about the destruction of the towers but also about the ruined pomegranate farms and the twenty-four thousand who starve every single day. I wondered if they thought about such things at all, if they could tear themselves away from their jobs and gas-guzzling cars and their interest payments long enough to consider their own contribution to the world they were passing on to their children. I wondered what they knew about Afghanistan — not the Afghanistan on television, the one littered with US military tents and tanks, but the old man’s Afghanistan. I wondered what those twenty-four thousand who die every day think.

  And then I saw myself again, sitting before a blank computer screen.

  I forced my attention back to Ground Zero. At the moment, one thing was certain: my country was thinking about revenge, and it was focusing on countries like Afghanistan and Iraq. But I was thinking about all the other places in the world where people hate our companies, our military, our policies, and our march toward global empire.

  I wondered, What about Panama, Ecuador, Indonesia, Iran, Guatemala, most of Africa?

  I pushed myself off the wall I had been leaning against and started walking away. A short, swarthy man was waving a newspaper in the air and shouting in Spanish. I stopped.

  “Venezuela on the brink of revolution!” he yelled above the noise of the traffic, the honking horns, and the milling people.

  I bought his paper and stood there for a moment scanning the lead article. It was about Hugo Chávez, Venezuela’s democratically elected, anti-American president, and the undercurrent of hatred generated by US policies in Latin America.

  What about Venezuela?

  CHAPTER 33

  Venezuela: Saved by Saddam

  I had watched Venezuela for many years. It was a classic example of a country that rose from rags to riches as a result of oil. It was also a model of the turmoil that oil wealth foments, of the dis-equilibrium between rich and poor, and of a country shamelessly exploited by the corporatocracy. It had become the epitome of a place where old-style EHMs like me converged with the new-style, corporate version.

  The events I read about in the newspaper that day at Ground Zero were a direct result of the 1998 elections, when the poor and disenfranchised of Venezuela elected Hugo Chávez by a landslide as their president.1 He immediately instituted drastic measures, taking control of the courts and other institutions and dissolving the Venezuelan congress. He denounced the United States for its “shameless imperialism,” spoke out forcefully against globalization, and introduced a hydrocarbons law that was reminiscent, even in name, of the one Jaime Roldós had brought to Ecuador shortly before his airplane went down. The law doubled the royalties charged to foreign oil companies. Then Chávez defied the traditional independence of the state-owned oil company, Petróleos de Venezuela, by replacing its top executives with people loyal to him.

  Venezuelan oil is crucial to economies around the world. In 2002, the nation was the world’s fourth-largest oil exporter and the number three supplier to the United States.2 Petróleos de Venezuela, with forty thousand employees and $50 billion a year in sales, provided 80 percent of the country’s export revenue. It was by far the most important factor in Venezuela’s economy.3 By taking over the industry, Chávez had thrust himself onto the world stage as a major player.

  Many Venezuelans saw this as destiny, the completion of a process that had begun eighty years earlier. On December 14, 1922, a huge oil blowout had gushed from the earth near Maracaibo. One hundred thousand barrels of crude sprayed into the air each day for the next three days, and this single geologic event changed Venezuela forever. By 1930, the country was the world’s largest oil exporter. Venezuelans looked to oil as a solution to all their problems.

  Oil revenues during the next forty years enabled Venezuela to evolve from one of the most impoverished nations in the world to one of the wealthiest in Latin America. All of the country’s vital statistics improved: health care, education, employment, longevity, and infant survival rates. Businesses prospered.

  During the 1973 OPEC oil embargo, petroleum prices skyrocke
ted and Venezuela’s national budget quadrupled. The EHMs went to work. The international banks flooded the country with loans that paid for vast infrastructure and industrial projects and for the highest skyscrapers on the continent. Then, during the 1980s, the corporate-style EHMs arrived. It was an ideal opportunity for them to cut their fledgling teeth. The Venezuelan middle class had become sizable and provided a ripe market for a vast array of products, yet there was still a very large poor sector available to labor in the sweatshops and factories.

  Then oil prices crashed, and Venezuela could not repay its debts. In 1989, the International Monetary Fund imposed harsh austerity measures and pressured Caracas to support the corporatocracy in many other ways. Venezuelans reacted violently; riots killed more than two hundred people. The illusion of oil as a bottomless source of support was shattered. From 1978 to 2003, Venezuela’s per capita income plummeted by more than 40 percent.4

  As poverty increased, resentment intensified. Polarization resulted, with the middle class pitted against the poor. As so often occurs in countries whose economies depend on oil production, demographics shifted radically. The sinking economy took its toll on the middle class, and many fell into the ranks of the poor.

  The new demographics set the stage for Chávez — and for conflict with Washington. Once in power, the new president took actions that challenged the Bush administration. Just before the September 11 attacks, Washington was considering its options. The EHMs had failed; was it time to send in the jackals?

  Then, 9/11 changed all priorities. President Bush and his advisers focused on rallying the world community to support US activities in Afghanistan and an invasion of Iraq. On top of that, the US economy was in the middle of a recession. Venezuela was relegated to a back burner. However, it was obvious that at some point Bush and Chávez would come to blows. With Iraqi and other Middle Eastern oil supplies threatened, Washington could not afford to ignore Venezuela for long.