The New Confessions of an Economic Hit Man

by John Perkins

  I wake up sometimes to the horrifying images of heads of state, friends of mine, who died violent deaths because they refused to betray their people. Like Shakespeare’s Lady Macbeth, I try to scrub the blood from my hands.

  But the blood is merely a symptom.

  The treacherous cancer beneath the surface, which was revealed in the original Confessions of an Economic Hit Man, has metasta-sized. It has spread from the economically developing countries to the United States and the rest of the world; it attacks the very foundations of democracy and the planet’s life-support systems.

  All the EHM and jackal tools — false economics, false promises, threats, bribes, extortion, debt, deception, coups, assassinations, unbridled military power — are used around the world today, even more than during the era I exposed more than a decade ago. Although this cancer has spread widely and deeply, most people still aren’t aware of it; yet all of us are impacted by the collapse it has caused. It has become the dominant system of economics, government, and society today.

  Fear and debt drive this system. We are hammered with messages that terrify us into believing that we must pay any price, assume any debt, to stop the enemies who, we are told, lurk at our doorsteps. The problem comes from somewhere else. Insurgents. Terrorists. “Them.” And its solution requires spending massive amounts of money on goods and services produced by what I call the corporatocracy — vast networks of corporations, banks, colluding governments, and the rich and powerful people tied to them. We go deeply into debt; our country and its financial henchmen at the World Bank and its sister institutions coerce other countries to go deeply into debt; debt enslaves us and it enslaves those countries.

  These strategies have created a “death economy” — one based on wars or the threat of war, debt, and the rape of the earth’s resources. It is an unsustainable economy that depletes at ever-increasing rates the very resources upon which it depends and at the same time poisons the air we breathe, the water we drink, and the foods we eat. Although the death economy is built on a form of capitalism, it is important to note that the word capitalism refers to an economic and political system in which trade and industry are controlled by private owners rather than the state. It includes local farmers’ markets as well as this very dangerous form of global corporate capitalism, controlled by the corporatocracy, which is predatory by nature, has created a death economy, and ultimately is self-destructive.

  I decided to write The New Confessions of an Economic Hit Man because things have changed so much during this past decade. The cancer has spread throughout the United States as well as the rest of the world. The rich have gotten richer and everyone else has gotten poorer in real terms.

  A powerful propaganda machine owned or controlled by the corporatocracy has spun its stories to convince us to accept a dogma that serves its interests, not ours. These stories contrive to convince us that we must embrace a system based on fear and debt, accumulating stuff, and dividing and conquering everyone who isn’t “us.” The stories have sold us the lie that the EHM system will provide security and make us happy.

  Some would blame our current problems on an organized global conspiracy. I wish it were so simple. Although, as I point out later, there are hundreds of conspiracies — not just one grand conspiracy — that affect all of us, this EHM system is fueled by something far more dangerous than a global conspiracy. It is driven by concepts that have become accepted as gospel. We believe that all economic growth benefits humankind and that the greater the growth, the more widespread the benefits. Similarly, we believe that those people who excel at stoking the fires of economic growth should be exalted and rewarded, while those born at the fringes are available for exploitation. And we believe that any means — including those used by today’s EHMs and jackals — are justified to promote economic growth; preserve our comfortable, affluent Western way of life; and wage war against anyone (such as Islamic terrorists) who might threaten our economic well-being, comfort, and security.

  In response to readers’ requests, I have added many new details and accounts of how we did our work during my time as an EHM, and I have clarified some points in the previously published chapters. More importantly, I have added an entirely new part 5, which explains how the EHM game is played today — who today’s economic hit men are, who today’s jackals are, and how their deceptions and tools are more far-reaching and enslaving now than ever.

  Also in response to readers’ requests, part 5 includes new chapters that reveal what it will take to overthrow the EHM system, and specific tactics for doing so.

  The book ends with a section titled “Documentation of EHM Activity, 2004–2015,” which complements my personal story by offering detailed information for readers who want further proof of the issues covered in this book or who want to pursue these subjects in more depth.

  Despite all the bad news and the attempts of modern-day robber barons to steal our democracy and our planet, I am filled with hope. I know that when enough of us perceive the true workings of this EHM system, we will take the individual and collective actions necessary to control the cancer and restore our health. The New Confessions of an Economic Hit Man reveals how the system works today and what you and I — all of us — can do to change it.

  Tom Paine inspired American revolutionaries when he wrote, “If there must be trouble, let it be in my day, that my child may have peace.” Those words are as important today as they were in 1776. My goal in this new book is nothing less than Paine’s: to inspire and empower us all to do whatever it takes to lead the way to peace for our children.

  PART I: 1963–1971

  CHAPTER 1

  Dirty Business

  When I graduated from business school in 1968, I was determined not to participate in the Vietnam War. I had recently married Ann. She too opposed the war and was adventurous enough to agree to join the Peace Corps with me.

  We first arrived in Quito, Ecuador, in 1968. I was a twenty-three-year-old volunteer assigned to develop credit and savings cooperatives in communities deep in the Amazon rain forest. Ann’s job was to teach hygiene and child care to indigenous women.

  Ann had been to Europe, but it was my first trip away from North America. I knew we’d fly into Quito, one of the highest capitals in the world — and one of the poorest. I expected it to be different from anything I’d ever seen, but I was totally unprepared for the reality.

  As our plane from Miami descended toward the airport, I was shocked by the hovels along the runway. I leaned across Ann in the middle seat and, pointing through my window, asked the Ecuadorian businessman in the aisle seat next to her, “Do people actually live there?”

  “We are a poor country,” he replied, nodding solemnly.

  The scenes that greeted us on the bus ride into town were even worse — tattered beggars hobbling on homemade crutches along garbage-infested streets, children with horribly distended bellies, skeletal dogs, and shantytowns of cardboard boxes that passed as homes.

  The bus delivered us to Quito’s five-star hotel, the InterContinental. It was an island of luxury in that sea of poverty, and the place where I and about thirty other Peace Corps volunteers would attend several days of in-country briefings.

  During the first of many lectures, we were informed that Ecuador was a combination of feudal Europe and the American Wild West. Our teachers prepped us about all the dangers: venomous snakes, malaria, anacondas, killer parasites, and hostile head-hunting warriors. Then the good news: Texaco had discovered vast oil deposits, not far from where we’d be stationed in the rain forest. We were assured that oil would transform Ecuador from one of the poorest countries in the hemisphere to one of the richest.

  One afternoon, while waiting for a hotel elevator, I struck up a conversation with a tall blond man who had a Texas drawl. He was a seismologist, a Texaco consultant. When he learned that Ann and I were poor Peace Corps volunteers who’d be working in the rain forest, he invited us to dinner in the elegant restaurant on the top floor o
f the hotel. I couldn’t believe my good fortune. I’d seen the menu and knew that our meal would cost more than our monthly living allowance.

  That night, as I looked through the restaurant’s windows out at Pichincha, the mammoth volcano that hovers over Ecuador’s capital, and sipped a margarita, I became infatuated with this man and the life he lived.

  He told us that sometimes he flew in a corporate jet directly from Houston to an airstrip hacked out of the jungle. “We don’t have to endure immigration or customs,” he bragged. “The Ecuadorian government gives us special permission.” His rain forest experience included air-conditioned trailers and champagne and filet mignon dinners served on fine china. “Not quite what you’ll be getting, I assume,” he said with a laugh.

  He then talked about the report he was writing that described “a vast sea of oil beneath the jungle.” This report, he said, would be used to justify huge World Bank loans to the country and to persuade Wall Street to invest in Texaco and other businesses that would benefit from the oil boom. When I expressed amazement that progress could happen so rapidly, he gave me an odd look. “What did they teach you in business school, anyway?” he asked.

  I didn’t know how to respond.

  “Look,” he said. “It’s an old game. I’ve seen it in Asia, the Middle East, and Africa. Now here. Seismology reports, combined with one good oil well, a gusher like the one we just hit . . .” He smiled. “Boomtown!”

  Ann mentioned all the excitement around how oil would bring prosperity to Ecuadorians.

  “Only those smart enough to play the game,” he said.

  I’d grown up in a New Hampshire town named after a man who’d built a mansion on a hill, overlooking everyone else, using the fortune he’d amassed by selling shovels and blankets to the California gold miners in 1849. “The merchants,” I said. “The businessmen and bankers.”

  “You bet. And today, the big corporations.” He tilted back in his chair. “We own this country. We get a lot more than permission to land planes without customs formalities.”

  “Like what?”

  “Oh my God, you do have a lot to learn, don’t you?” He raised his martini toward the city. “To begin with, we control the military. We pay their salaries and buy them their equipment. They protect us from the Indians who don’t want oil rigs on their lands. In Latin America, he who controls the army controls the president and the courts. We get to write the laws — set fines for oil spills, labor rates, all the laws that matter to us.”

  “Texaco pays for all that?” Ann asked.

  “Well, not exactly . . .” He reached across the table and patted her arm. “You do. Or your daddy does. The American taxpayer. The money flows through USAID, the World Bank, CIA, and the Pentagon, but everyone here” — he swept his arm toward the window and the city below — “knows it’s all about Texaco. Remember, countries like this have long histories of coups. If you take a good look, you’ll see that most of them happen when the leaders of the country don’t play our game.”1

  “Are you saying Texaco overthrows governments?” I asked.

  He laughed. “Let’s just say that governments that don’t cooperate are seen as Soviet puppets. They threaten American interests and democracy. The CIA doesn’t like that.”

  That night was the beginning of my education in what I’ve come to think of as the EHM system.

  Ann and I spent the next months stationed in the Amazon rain forest. Then we were transferred to the high Andes, where I was assigned to help a group of campesino brick makers. Ann trained handicapped people for jobs in local businesses.

  I was told that the brick makers needed to improve the efficiency of the archaic ovens in which their bricks were baked. However, one after another they came to me complaining about the men who owned the trucks and the warehouses down in the city.

  Ecuador was a country with little social mobility. A few wealthy families, the ricos, ran just about everything, including local businesses and politics. Their agents bought the bricks from the brick makers at extremely low prices and sold them at roughly ten times that amount. One brick maker went to the city mayor and complained. Several days later he was struck by a truck and killed.

  Terror swept the community. People assured me that he’d been murdered. My suspicions that it was true were reinforced when the police chief announced that the dead man was part of a Cuban plot to turn Ecuador Communist (Che Guevara had been executed by a CIA operation in Bolivia less than three years earlier). He insinuated that any brick maker who caused trouble would be arrested as an insurgent.

  The brick makers begged me to go to the ricos and set things right. They were willing to do anything to appease those they feared, including convincing themselves that, if they gave in, the ricos would protect them.

  I didn’t know what to do. I had no leverage with the mayor and figured that the intervention of a twenty-five-year-old foreigner would only make matters worse. I merely listened and sympathized.

  Eventually I realized that the ricos were part of a strategy, a system that had subjugated Andean peoples through fear since the Spanish conquest. I saw that by commiserating, I was enabling the community to do nothing. They needed to learn to face their fears; they needed to admit to the anger they had suppressed; they needed to take offense at the injustices they had suffered; they needed to stop looking to me to set things right. They needed to stand up to the ricos.

  Late one afternoon I spoke to the community. I told them that they had to take action. They had to do whatever it would take — including taking the risk of being killed — so that their children could prosper and live in peace.

  My realization about enabling that community was a great lesson for me. I understood that the people themselves were collaborators in this conspiracy and that convincing them to take action offered the only solution. And it worked.

  The brick makers formed a co-op. Each family donated bricks, and the co-op used the income from those bricks to rent a truck and warehouse in the city. The ricos boycotted the co-op, until a Lutheran mission from Norway contracted with the co-op for all the bricks for a school it was building, at about five times the amount the ricos had paid the brick makers but half the price the ricos were charging the Lutherans — a win-win situation for everyone except the ricos. The co-op flourished after that.

  Less than a year later, Ann and I completed our Peace Corps assignment. I was twenty-six and no longer subject to the draft. I became an EHM.

  When I first entered those ranks, I convinced myself that I was doing the right thing. South Vietnam had fallen to the Communist north, and now the world was threatened by the Soviet Union and China. My business school professors had taught that financing infrastructure projects through mountains of World Bank debt would pull economically developing nations out of poverty and save them from the clutches of communism. Experts at the World Bank and USAID reinforced this mind-set.

  By the time I discovered the falsehoods in that story, I felt trapped by the system. I had grown up feeling poor in my New Hampshire boarding school, but suddenly I was making a great deal of money, traveling first class to countries I’d dreamed about all my life, staying in the best hotels, eating in the finest restaurants, and meeting with heads of state. I had it made. How could I even consider getting out?

  Then the nightmares began.

  I woke in dark hotel rooms sweating, haunted by images of sights I had actually seen: legless lepers strapped into wooden boxes on wheels, rolling along the streets of Jakarta; men and women bathing in slime-green canals while, next to them, others defecated; a human cadaver abandoned on a garbage heap, swarming with maggots and flies; and children who slept in cardboard boxes, vying with roaming packs of dogs for scraps of rubbish. I realized that I’d distanced myself emotionally from these things. Like other Americans, I’d seen these people as less than human; they were “beggars,” “misfits” — “them.”

  One day my Indonesian government limo stopped at a traffic light. A leper thr
ust the gory remnants of a hand through my window. My driver yelled at him. The leper grinned, a lopsided toothless smile, and withdrew. We drove on, but his spirit remained with me. It was as though he had sought me out; his bloody stump was a warning, his smile a message. “Reform,” he seemed to say. “Repent.”

  I began to look more closely at the world around me. And at myself. I came to understand that although I had all the trappings of success, I was miserable. I’d been popping Valium every night and drinking lots of alcohol. I’d get up in the morning, force coffee and pep pills into my system, and stagger off to negotiate contracts worth hundreds of millions of dollars.

  That life had come to seem normal to me. I had bought into the stories. I was taking on debt to support my lifestyle. I was operating out of fear — the fear of communism, losing my job, failure, and not having the material things everyone told me I needed.

  One night I woke up with the memory of a different type of dream.

  I had walked into the office of a leader in a country that had just discovered it had lots of oil. “Our construction companies,” I told him, “will rent equipment from your brother’s John Deere franchise. We’ll pay twice the going rate; your brother can share his profits with you.” In the dream I went on to explain that we’d make similar deals with friends of his who owned Coca-Cola bottling plants, other food and beverage suppliers, and labor contractors. All he had to do was sign off on a World Bank loan that would hire US corporations to build infrastructure projects in his country.

  Then I casually mentioned that a refusal would bring in the jackals. “Remember,” I said, “what happened to . . .” I rattled off a list of names like Mossedegh of Iran, Arbenz of Guatemala, Allende of Chile, Lumumba of the Congo, Diem of Vietnam. “All of them,” I said, “were overthrown or . . .” — I ran a finger across my throat — “because they didn’t play our game.”