by John Perkins

PROLOGUE

Quito, EcuadorÂ’s
capital, stretches across a volcanic valley high in the Andes, at
an altitude of nine thousand feet. Residents of this city, which
was founded long before Columbus arrived in the Americas, are accustomed
to seeing snow on the surrounding peaks, despite the fact that they
live just a few miles south of the equator. The city of Shell, a
frontier outpost and military base hacked out of EcuadorÂ’s
Amazon jungle to service the oil company whose name it bears, is
nearly eight thousand feet lower than Quito. A steaming city, it
is inhabited mostly by soldiers, oil workers, and the indigenous
people from the Shuar and Kichwa tribes who work for them as prostitutes
and laborers.

To journey
from one city to the other, you must travel a road that is both
tortuous and breathtaking. Local people will tell you that during
the trip you experience all four seasons in a single day. Although
I have driven this road many times, I never tire of the spectacular
scenery. Sheer cliffs, punctuated by cascading waterfalls and brilliant
bromeliads, rise up one side. On the other side, the earth drops
abruptly into a deep abyss where the Pastaza River, a headwater
of the Amazon, snakes its way down the Andes. The Pastaza carries
water from the glaciers of Cotopaxi, one of the worldÂ’s highest
active volcanoes and a deity in the time of the Incas, to the Atlantic
Ocean over three thousand miles away.

In 2003, I
departed Quito in a Subaru Outback and headed for Shell on a mission
that was like no other I had ever accepted. I was hoping to end
a war I had helped create. As is the case with so many things we
EHMs must take responsibility for, it is a war that is virtually
unknown anywhere outside the country where it is fought. I was on
my way to meet with the Shuars, the Kichwas, and their neighbors
the Achuars, the Zaparos, and the Shiwiars – tribes determined
to prevent our oil companies from destroying their homes, families,
and lands, even if it means they must die in the process. For them,
this is a war about the survival of their children and cultures,
while for us it is about power, money, and natural resources. It
is one part of the struggle for world domination and the dream of
a few greedy men, global empire.

That is what
we EHMs do best: we build a global empire. We are an elite group
of men and women who utilize international financial organizations
to foment conditions that make other nations subservient to the
corporatocracy running our biggest corporations, our government,
and our banks. Like our counterparts in the Mafia, EHMs provide
favors. These take the form of loans to develop infrastructure –
electric generating plants, highways, ports, airports, or industrial
parks. A condition of such loans is that engineering and construction
companies from our own country must build all these projects. In
essence, most of the money never leaves the United States; it is
simply transferred from banking offices in Washington to engineering
offices in New York, Houston, or San Francisco.

Despite the
fact that the money is returned almost immediately to corporations
that are members of the corporatocracy (the creditor), the recipient
country is required to pay it all back, principal plus interest.
If an EHM is completely successful, the loans are so large that
the debtor is forced to default on its payments after a few years.
When this happens, then like the Mafia we demand our pound of flesh.
This often includes one or more of the following: control over United
Nations votes, the installation of military bases, or access to
precious resources such as oil or the Panama Canal. Of course, the
debtor still owes us the money – and another country is added
to our global empire.

Driving from
Quito toward Shell on this sunny day in 2003, I thought back thirty-five
years to the first time I arrived in this part of the world. I had
read that although Ecuador is only about the size of Nevada, it
has more than thirty active volcanoes, over 15 percent of the worldÂ’s
bird species, and thousands of as-yet-unclassified plants, and that
it is a land of diverse cultures where nearly as many people speak
ancient indigenous languages as speak Spanish. I found it fascinating
and certainly exotic; yet, the words that kept coming to mind back
then were pure, untouched, and innocent. Much
has changed in thirty-five years.

At the time
of my first visit in 1968, Texaco had only just discovered petroleum
in EcuadorÂ’s Amazon region. Today, oil accounts for nearly
half the countryÂ’s exports. A trans-Andean pipeline built shortly
after my first visit has since leaked over a half million barrels
of oil into the fragile rain forest – more than twice the amount
spilled by the Exxon Valdez. Today, a new $1.3 billion, three
hundred–mile pipeline constructed by an EHM–organized
consortium promises to make Ecuador one of the worldÂ’s top
ten suppliers of oil to the United States. Vast areas of rain forest
have fallen, macaws and jaguars have all but vanished, three Ecuadorian
indigenous cultures have been driven to the verge of collapse, and
pristine rivers have been transformed into flaming cesspools.

During this
same period, the indigenous cultures began fighting back. For instance,
on May 7, 2003, a group of American lawyers representing more than
thirty thousand indigenous Ecuadorian people filed a $1 billion
lawsuit against ChevronTexaco Corp. The suit asserts that between
1971 and 1992 the oil giant dumped into open holes and rivers over
four million gallons per day of toxic wastewater contaminated with
oil, heavy metals, and carcinogens, and that the company left behind
nearly 350 uncovered waste pits that continue to kill both people
and animals.

Outside the
window of my Outback, great clouds of mist rolled in from the forests
and up the PastazaÂ’s canyons. Sweat soaked my shirt, and my
stomach began to churn, but not just from the intense tropical heat
and the serpentine twists in the road. Knowing the part I had played
in destroying this beautiful country was once again taking its toll.
Because of my fellow EHMs and me, Ecuador is in far worse shape
today than she was before we introduced her to the miracles of modern
economics, banking, and engineering. Since 1970, during this period
known euphemistically as the Oil Boom, the official poverty level
grew from 50 to 70 percent, under- or unemployment increased from
15 to 70 percent, and public debt increased from $240 million to
$16 billion. Meanwhile, the share of national resources allocated
to the poorest segments of the population declined from 20 to 6
percent.

Unfortunately,
Ecuador is not the exception. Nearly every country we EHMs have
brought under the global empireÂ’s umbrella has suffered a similar
fate. Third world debt has grown to more than $2.5 trillion, and
the cost of servicing it – over $375 billion per year as of
2004 – is more than all third world spending on health and
education, and twenty times what developing countries receive annually
in foreign aid. Over half the people in the world survive on less
than two dollars per day, which is roughly the same amount they
received in the early 1970s. Meanwhile, the top 1 percent of third
world households accounts for 70 to 90 percent of all private financial
wealth and real estate ownership in their country; the actual percentage
depends on the specific country.

The Subaru
slowed as it meandered through the streets of the beautiful resort
town of Baños, famous for the hot baths created by underground
volcanic rivers that flow from the highly active Mount Tungurahgua.
Children ran along beside us, waving and trying to sell us gum and
cookies. Then we left Baños behind. The spectacular scenery
ended abruptly as the Subaru sped out of paradise and into a modern
vision of DanteÂ’s Inferno
A gigantic monster reared up from the river, a mammoth gray wall.
Its dripping concrete was totally out of place, completely unnatural
and incompatible with the landscape. Of course, seeing it there
should not have surprised me. I knew all along that it would be
waiting in ambush. I had encountered it many times before and in
the past had praised it as a symbol of EHM accomplishments. Even
so, it made my skin crawl.

That hideous,
incongruous wall is a dam that blocks the rushing Pastaza River,
diverts its waters through huge tunnels bored into the mountain,
and converts the energy to electricity. This is the 156- megawatt
Agoyan hydroelectric project. It fuels the industries that make
a handful of Ecuadorian families wealthy, and it has been the source
of untold suffering for the farmers and indigenous people who live
along the river. This hydroelectric plant is just one of many projects
developed through my efforts and those of other EHMs. Such projects
are the reason Ecuador is now a member of the global empire, and
the reason why the Shuars and Kichwas and their neighbors threaten
war against our oil companies.

Because of
EHM projects, Ecuador is awash in foreign debt and must devote an
inordinate share of its national budget to paying this off, instead
of using its capital to help the millions of its citizens officially
classified as dangerously impoverished. The only way Ecuador can
buy down its foreign obligations is by selling its rain forests
to the oil companies. Indeed, one of the reasons the EHMs set their
sights on Ecuador in the first place was because the sea of oil
beneath its Amazon region is believed to rival the oil fields of
the Middle East.8 The global empire demands its pound of flesh in
the form of oil concessions.

These demands
became especially urgent after September 11, 2001, when Washington
feared that Middle Eastern supplies might cease. On top of that,
Venezuela, our third-largest oil supplier, had recently elected
a populist president, Hugo Chávez, who took a strong stand
against what he referred to as U.S. imperialism; he threatened to
cut off oil sales to the United States. The EHMs had failed in Iraq
and Venezuela, but we had succeeded in Ecuador; now we would milk
it for all it is worth.

Ecuador is
typical of countries around the world that EHMs have brought into
the economic-political fold. For every $100 of crude taken out of
the Ecuadorian rain forests, the oil companies receive $75. Of the
remaining $25, three-quarters must go to paying off the foreign
debt. Most of the remainder covers military and other government
expenses – which leaves about $2.50 for health, education,
and programs aimed at helping the poor. Thus, out of every $100
worth of oil torn from the Amazon, less than $3 goes to the people
who need the money most, those whose lives have been so adversely
impacted by the dams, the drilling, and the pipelines, and who are
dying from lack of edible food and potable water.

All of those
people – millions in Ecuador, billions around the planet –
are potential terrorists. Not because they believe in communism
or anarchism or are intrinsically evil, but simply because they
are desperate. Looking at this dam, I wondered – as I have
so often in so many places around the world – when these people
would take action, like the Americans against England in the 1770s
or Latin Americans against Spain in the early 1800s.

The subtlety
of this modern empire building puts the Roman centurions, the Spanish
conquistadors, and the eighteenth- and nineteenth-century European
colonial powers to shame. We EHMs are crafty; we learned from history.
Today we do not carry swords. We do not wear armor or clothes that
set us apart. In countries like Ecuador, Nigeria, and Indonesia,
we dress like local schoolteachers and shop owners. In Washington
and Paris, we look like government bureaucrats and bankers. We appear
humble, normal. We visit project sites and stroll through impoverished
villages. We profess altruism, talk with local papers about the
wonderful humanitarian things we are doing. We cover the conference
tables of government committees with our spreadsheets and financial
projections, and we lecture at the Harvard Business School about
the miracles of macroeconomics. We are on the record, in the open.
Or so we portray ourselves and so are we accepted. It is how the
system works. We seldom resort to anything illegal because the system
itself is built on subterfuge, and the system is by definition legitimate.

However –
and this is a very large caveat – if we fail, an even more
sinister breed steps in, ones we EHMs refer to as the jackals, men
who trace their heritage directly to those earlier empires. The
jackals are always there, lurking in the shadows. When they emerge,
heads of state are overthrown or die in violent “accidents.”
And if by chance the jackals fail, as they failed in Afghanistan
and Iraq, then the old models resurface. When the jackals fail,
young Americans are sent in to kill and to die.
As I passed the monster, that hulking mammoth wall of gray concrete
rising from the river, I was very conscious of the sweat that soaked
my clothes and of the tightening in my intestines. I headed on down
into the jungle to meet with the indigenous people who are determined
to fight to the last man in order to stop this empire I helped create,
and I was overwhelmed with feelings of guilt. How, I asked myself,
did a nice kid from rural New Hampshire ever get into such a dirty
business?

Continue
Reading: Buy the Book

Reprinted
with permission of the publisher. From Confessions of an Economic
Hit Man, copyright© 2005 by John Perkins, Berrett-Koehler
Publishers, Inc., San Francisco, CA. All rights reserved.

June
21, 2012

Copyright
© 2005 Berrett-Koehler Publishers