Friday, February 10, 2006

Book Review: Confessions of an economic hit man by John Perkins

Those who know me best know that I despise conspiracy theory as an explanation of history, especially in our region. Unfortunately for me and my presumable solid logic, for the last couple of years, more and more revelations of plots and conspiracies have seriously undermined my argument, this book is a case in point.

The book is a an autobiography and/or expose of what the author refer to as EHT, an economic hit man. That refers to high ranking consultants and business executive in the US who deal with developing countries, often in collusion with the US intelligence community and international financial institutions such as the World Bank, the IMF and so on. The author refers to this "Cabal" as the Corporatocracy.

The author start his story by telling how he was interviewed by the NSA (the biggest US intelligence agency), then was approached by an international consulting organization based on the agency recommendation. Upon joining, he is put through an induction process that rival James Bond training, he is told that he will be an economic hit man. That means that he will travel to "Third World Countries" on behest of the World Bank et al, and basically convince the developing countries to ask for huge loans that they can never repay in order to build huge (and far exceeding need) infrastructure projects to be built by American firms that will send all of the money home to the US. When the countries understandably default of the debt, they become under the thumb of the corporatocracy and more importantly, politically in the US pocket.

The Author then recounts his first assignment in Indonesia, where he was tasked to estimate the country's need of electric power. He was pushed by superiors into grossly overestimating the growth in consumption to justify bigger loans and thus bigger bounty for US construction and power companies. When a senior expert refuses to toe the line, he is fired and replaced by the author, who despite misgivings, deliver what is expected of him. As reward, he is given a promotion and the title Chief Economist, even when he obviously does not have the qualifications.

This story repeated in many countries, and the result is always similar, the population suffer, while the multinational corporations and the local elites make billions. It is quite depressing to read how the "fruits of modernity" never reaches the average citizen in the developing world even when they are burdened by the debt assumed in their name.

A notable mention is the author dealing with Saudi Arabia, which he refers to as the Saudi Money Laundering Affair, if this is true, it tells alot about the problems Saudi Arabia faces today. The Author recounts how the Saudi government has agreed after the Oil Shocks to use the majority of its petrodollars to purchase US treasury bonds. The US treasury will then use the interest on these bonds to execute mega projects in the Kingdom, all by US companies and designed by the corporatocracy. Projects were designed with the interest of the US companies in mind, not the Saudi citizens!

In short, the book is eye opening, and in a way explains why the rich stay rich in this world, mainly because they make the rules of the game and it is extremely in their favour. Whatever you think of the author, most of his arguments and statements are backed up by facts, and it tells a depressing story, it also explain why some developing countries (especially in Latin America) are rejecting to be in this system anymore, and more frequently, they are rejecting American style democracy that came with loans and promises of development.

I greatly encourage you to read this book, this a link to the book on Amazon


At 6:05 PM, Anonymous Aya said...

Dear Qais,

Great review. This book is one of my favorites since it deals with issues related to global injustices and economic inequalities. I like to go back to it from time to time and re-read the section about Saudi Arabia. It truly makes sense!

All the best,

At 11:51 PM, Blogger Desert Pundit said...

Thanks for the comment, we totally agree on this.



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