AFRICA

(from The Secret History of the American Empire)
Continuing our study of Western involvement in different continents through economic hitmen and jackals, we arrive in Africa. Perkins calls Africa the least understood continent, and the phrase has merit. The problems plaguing Africa sometimes overshadow the rays of hope that do exist there today. Though this hope is not my topic today, rest assured that there is hope and there are rays.

The problems facing many of the countries of Africa (many of them being part of the “Bottom Billion” coined by Paul Collier) date back to the times of colonialism but need not still be here with us. There have been other forces derelict that could have crafted a new route for some of the countries in spite of the colonial pasts but instead we’ve had new forces that have helped to sustain a path (for some, not all African countries) of stagnancy or plummeting health conditions, conflict conditions, and poverty. One of those forces deals with this concept of corporatocracy and effect of western businesses and business-supporting governments in the affairs of African countries.

The US had a role in the assassination of Lumumba in the DRC and supported malevolent dictators or leaders like Jonas Savimbi in Angola, Mobutu Sese Seko in the DRC, Laurent Kabila in the DRC, General Sani Abacha in Nigeria, Olesegun Obasanjo in Nigeria, Samuel Doe in Liberia, etc.

Sometimes forces for good unintentionally cause bad. In Uganda, peace talks began in 2006 (Joseph Kony is still free and roaming around) but one contribution to the late start of such talks is the presence of NGOs that provide wells, educational facilities, and food relief. Western governments and the Ugandan government shrank their responsibility for ending the fighting because of the gap being filled by NGOs. In other words, sometimes NGO work allows Western governments to show that the Western governments are doing something in a certain situation, when what we really need is for these Western governments to systematically address the root causes of the situation. So NGO work can substitute for diplomatic or political engagement (I’m not suggesting that elections solve anything; elections themselves do not represent democracy and many leaders have been forced to have elections to show they embrace democracy but can easily ensure the results that keep themselves in power).

Sadly a lot of Western business benefits monetarily from instability in Africa -- arms sales; exploitation of mineral resources, cheap labor, and agricultural products. In a stable, peaceful truly democratic (meaning there are checks and balances and accountability not just elections) DRC, it would be much harder to exploit mineral resources. We make money from natural disasters and man-made disasters such as war.

I remember when a large company named Shell had trouble with a Nigerian environmental activist. Because the government (oligarchy or plutocracy) colluded unofficially or official with Shell and mixed with corruption benefited an elite few, it was advantageous that Ken Saro-Wiwa stop organizing protests against Shell. He was arrested and tried by the government of General Abacha (a pro-western company dictator), and in November of 1995, he was executed by hanging along with 8 other environmentalists. I retrospectively remember this especially because Mandela considered it one of the dark spots in his time as president since he fought for the release of Saro-Wiwa.

During the Cold War, Africa became a battleground between what was labeled the communist threat and the capitalist threat depending on your perspective. When Lisbon decided to free her colonies, Washington went into heated internal debate about how to respond. The closure of the Suez Canal and the new supertankers made the case for a location or base to protect shipping lanes from Middle Eastern ports through the Red Sea, Persian Gulf, and Arabian Sea, into the Indian Ocean, around the Cape of Good Hope and up the west coast of Africa off into the Atlantic. A decision was made to put this fortress on Aldabra Island, off the east coast of Africa. This would add to Simon’s Town, a South African naval base that the US used to refit nuclear submarines before going back out to patrol.

The government planners discovered that Aldabra was a breeding ground for a rare species of giant tortoises and not wanting to face the backlash or bad publicity from ecologically-minded groups, they changed their choice to Diego Garcia, a large British territory and island in the Chagos chain, part of Mauritius. There was only one problem: people inhabited the island--1800 descendants of African slaves.

According to Perkins, EHMs and US and British intelligence agents, brokered a deal in 1970 where London secretly forced the inhabitants off the island. It was done secretly to maintain the pretense that the island was uninhabited. Many were sent to nearby Seychelles. Then England sold an uninhabited Diego Garcia to the US and received an $11 million subsidy on Polaris submarine technology. If you want to how much each life was valued at, do the math.

The Pentagon built the military base which housed B-52s and Stealth bombers it played a key role for the US, though relatively unknown. But a problem arose when James Mancham was elected the Seychelles’ first president after independence was declared on June 29, 1976. Mancham communicated with the US through South Africa and made it known that he supported the Diego Garcia deal. He offered to quietly take in the displaced Garcians and he enjoyed benefits from it according to Perkins. This doesn’t seem like a problem until you consider the Seychelles citizens.

They had a huge sense of national pride after independence and had a backlash against Mancham, the deference paid to the US and UK, and the policies causing Garcians to come to the Seychelles (especially since the influx of people created competition for their jobs). While Mancham was visiting London in 1977, Prime Minister France-Albert Rene led a bloodless coup and overthrew the president. Rene said he would give a greater share of the country’s wealth to the country’s poor and opposed the US military base saying the Garcians should be allowed to return back to their homeland. According to Perkins, EHMs were working this situation, but were pulled off the case in 1981 and jackals were called in.

The plan was for forty top jackals to assemble in Swaziland, fly to Victoria (capital city of Mahe), and meet up with an advance team (including a few women hired to get information out higher-ups). There were local cops ready to help and the only opposition would come from several hundred Tanzanian soldiers (Tanzoons) brought in by Rene near the airport. They were to creep into the barracks of the Tanzoons and shoot them in the night which would signal the uprising as they took the radio stations and the presidential palace.


However, the plan failed. Though the weapons were stored on the island, for some reason the plans changed at the last minute calling for some weapons to be brought with them. One jackal had an assault rifle that was poorly wrapped and was caught at the airport. A gun battle followed. The jackals captured more weapons and ammo from troops they ambushed on their way to the barracks. Other jackals tried to attack the Tanzoon barracks but failed. The fighting went on through the night. An Air India jetliner requested permission to land wondering why the lights were out. One of the jackals turned on the lights and granted permission to land. The jackals and Seychelles authorities talked on the phone and agreed to a cease-fire if the jackals would board the plane and leave the island. Some decided to stay behind but the remainder decided to take the plane to Durban, South Africa. At this point there was one dead, seven missing, captured or taken prisoner including one of the women accomplices.

The Seychelles government arrested the seven, eventually dropped the charges against the woman, sentenced four of the men to death and the other two to 10-20 year prison terms. After negotiations with Pretoria, South Africa eventually paid $3 million for the release of the 6. In the subsequent media coverage, the US and UK managed to avoid notoriety while South Africa took much of the blame. After that President Rene became more moderate and tempered his policies towards Diego Garcia.

The list of stories goes on and on. From agricultural subsidies that adversely affect the global poor (corn, cotton, etc.) to Western government agencies working with a company like Monsanto to rewrite Malian legislation to allow the introduction, sale, and patenting rights of Genetically Modified Organisms (GMO) crops. Sometimes the way such aid and development is structured, it causes farming communities in developing countries in Africa to become dependent on fertilizers, pesticides, newer plows, herbicides, and GMO seeds. Sometimes this is purchased on credit which sends some farmers in deeper debt (I don’t have statistics to give you percentages).

The strongest picture in my head of corporate interests in Africa deals with the very instrument on which I’m typing -- laptops. Laptops and cell phones. They both have tantalum, also known as coltan. And the Democratic Republic of Congo has it in abundance along with gold, diamonds, and copper. Remember that DRC has been embroiled in conflict for the past 15. After it’s independence from Belgium in 1960, Prime Minister Lumumba was assassinated by Belgian and U.S. backed opponents due to ties to the Soviet Union, according to TIME magazine’s 2006 cover story as reported by Perkins. General Mobutu Sese Seko took over after Lumumba. Mobutu’s rule was corrupt, though he was a “favored” by the US. But his rule disturbed the DRC’s neighbors and in 1996 and 1997 Uganda and Rwanda invaded and overthrew Mobutu installing Laurent Kabila as the new president. But even with Kabila the socioeconomic state deteriorated and Uganda and Rwanda invaded again in 1998 along with six other countries sparking Africa’s first World War.

Now when wars occur and countries invade the DRC, militias from Uganda and Rwanda earn millions--no--billions of dollars from the sale of tantalum that they collect and smuggle across the border. This is the same tantalum whose shortage caused a shortage of Sony Play Stations 2’s during the 2000 Christmas season. Now if you read the section “It’s Not About You” above, you know there is a Do-It-Yourself foreign aid woman who has been working to change the situation of tantalum which fuels wars in places in Africa. More still needs to be done. But this bright young woman (read the article) shows that there is hope and change does come.

Billions are made selling arms to both sides in conflicts. War enables corporations to sidestep tariffs, taxes, and human rights-based and environmental regulations. Again, corporations due profit when there is conflict.

I leave you with the words of U.S. Congresswoman Cynthia McKinney (D-Georgia) during a hearing she chaired April 16, 2001.



“Much of what you will hear today has not been widely reported in the public media. Powerful forces have fought to suppress these stories from entering the public domain.

“The investigations into the activities of Western governments and Western businessmen in post-colonial Africa provide clear evidence of the West’s long-standing propensity for cruelty, avarice, and treachery. The misconduct of Western nations in Africa is not due to momentary lapses, individual defects, or errors of common human frailty. Instead, they form part of a long-term policy designed to access and plunder Africa’s wealth at the expense of its people.

“. . .at the heart of Africa’s suffering is the West’s, and most notably the United States’, desire to access Africa’s diamonds, oil, natural gas, and other precious resources. . .the West, and most notably the United States, has set in motion a policy of oppression, destabilization and tempered, not by moral principle, but by a ruthless desire to enrich itself on Africa’s fabulous wealth. . . Western countries have incited rebellion against stable African governments. . . Have even actively participated in the assassination of duly elected and legitimate African Heads of State and replaced them with corrupted and malleable officials.”

MIDDLE EAST

I’ve been delaying continuing the economic empire talks with the Middle East. We’ve been traveling geographically as opposed to chronologically. But the Middle East is probably the most significant region in this game because of one single resource--oil. And it still affects the world today. Oil, like gold, became a way of valuing currencies and a symbol of wealth and real power, quite honestly. But oil was even more valuable because it is use in most products today--plastics, composites, chemicals, computer parts, etc.

After WWII, oil company executives worked to convince the Congress and the president to save our domestic oil supplies and rather go after oil in other parts of the world. So working with UK and European companies, they obtained tax breaks and incentives to ensure they maintained domination of global petroleum supplies.


Well, at the same time, we were entering the Cold War with Russia labeled as the enemy (and vice versa). Why I bring this up is that in every geopolitical move in the latter half of the 20th century, the America empire used Communism and the USSR as the excuse or reason or threat. This is normal in most empires if you study history. So let’s look at how it plays into Iran.

IRAN
The 1951 Time magazine man of the year was the democratically elected Mohammed Mossadegh who wanted his people to share in more of the profits from the oil companies. So he nationalized a British petroleum company. Both England and the US did not like this but thought that military action would cause the USSR to act. So instead of the marines, CIA agent Kermit Roosevelt (Theodore’s grandson) was sent in. With a few million dollars he organized violent demonstrations that overthrew Mossadegh. He was replaced by the CIA with Mohammed Rez Pahlavi, known as “the Shah,” the despotic partner of the oil companies. So a democratically elected president was replaced by a despot, but because this despot was good for big oil we were ok with it. (this will later change)

(By the way, this led to EHMs because Roosevelt was successful, but if he had been caught that would have been very bad for the US because he’s a US government agent. EHMs are contractors and work for other groups, so it’s less sticky and incriminating)


Reason #1 - Why Some Middle Easterners Don’t Like Us (there are many)
1. The Iranian people, to this day in 2010, have never forgotten this and never forgave the US. This includes other countries in the region. (I honestly believe this is why it’s hard for them or their politicians to believe the US when we say certain things. Do you blame them?) There are political scientists who believe if the US had, instead, encouraged Iran to apply oil revenues toward social services for his people and had supported him, democracy might have been encouraged to grow in the region and much of the violence in the region might have been prevented.

Well, the country’s debt increased as the corporatocracy grew, says John Perkins. Factories for our products were increasingly located in other countries. And foreign creditors (people from whom we took out loans in other countries) wanted to be repaid in gold. The Nixon administration responded by revoking the gold standard in 1971. This is a little hard to understand, but if these foreign creditors (people to whom we owed money in other countries) switched to other currencies (switched to some non-US dollar currency), the US would have to repay the loans at the value that the loan had relative to gold when the debt was incurred. But the US didn’t have the money to do this; they would go bankrupt. Or the US Mint could print a bunch of money and devalue the dollar in an effort to pay, but who wanted to do that? So the goal was to make sure the world kept accepting the dollar as the standard currency. And Nixon and Kissinger and his team figured out a way to do this.

SAUDI ARABIA
First, Israel decided to launch pre-emptive attacks aimed at Jordanian, Syrian, and Egyptian troops along its borders; this became the Six-Day war in 1967. Many think this was Israel’s determination to protect its borders. After the week, Israel’s land holdings had quadrupled, of course, at the expense of people in the West Bank, Golan Heights (Syria), Sinai (Egypt), and East Jerusalem.


Reason #2
2. Arabs were angry by the loss and frustrated. They knew that Israel needed US financial/military and political support and could not have succeeded, otherwise. I always thought Washington’s motives were Israel, but I’m learning that Washington had more self-focused motives than that.

It’s time for Chess. Watch this.
Secondly, Egypt and Syria, in response I believe, attacked Israel simultaneously in 1973 on Yom Kippur (the holiest of Jewish holidays)
Egyptian President Anwar Sadat asked Saudi Arabian King Faisal to act against the US by using “the oil weapon.” On October 16, Saudi Arabia along with 4 other Arab nations and Iran joined in announcing a 70% increase in the price of oil.
On October 19th, Nixon asked Congress to approve $2.2 billion in aid to Israel.
The next day, Saudi Arabia led Arab oil producers in a total embargo of oil to the U.S.
By January 1974, the selling price of Saudi oil was nearly 7 times its price 4 years earlier. There were long lines of cars at gas stations around the country. People thought the economy was on the verge of collapse.
And the last move belongs to Nixon and the U.S. By giving the aid to Israel, they purposely engineered a situation (the embargo) that was conducive for their next move.
The U.S. Treasury department contacted MAIN and other contractors with EHMs. Their mission was two-part: 1) formulate a plan to ensure that OPEC would funnel all the US money spent on oil right back to the US and 2) establish a new “oil standard” to replace the gold standard

And they did it. John Perkins was one of the EHMs who engineered this through trips to Saudi Arabia. The House of Saud agreed to 1) invest a large portion of its petrodollars in US government securities, 2) allow the US Treasury Department to use trillions of dollars in interest from these securities to hire U.S. corporation to westernize Saudi Arabia, and 3) maintain the price of oil within acceptable limits (acceptable to corporatocracy). Then get this: Saudi Arabia (biggest oil producer in the world) also agreed to trade oil exclusively in U.S. dollars. Now oil replaced gold as the measure of a currency’s value; the dollar reigned supreme.

Reason #3 (and there are many)
I’m quite amazed the House of Saud even agreed to this, but let’s face it. They were put in power by the British and weren’t looking after the needs of their people. But this deal which the Nixon administration masterminded quite well angered one person--Osama bin Laden, a Saudi millionaire who would go on to coordinate and chiefly execute 9/11.


LEBANON
Skipping much of its history, it was the Lebanese Republic in 1926, formed by the French, but when France gave allegiance to Nazi-controlled Vichy government, German supplies moved through to Iraq to fight the British. It won it’s independence in 1944 on January 1st. A National Covenant was adopted by the prominent two leaders of the Christian and Muslim communities. The only problem is that the covenant gave power according to a 1932 census (12 years ago) in which Christians were 54% of the population. The covenant said the president would a member of the majority, Maronite Christian, the prime minister would be a member of the Sunni population and the speaker of the legislature would be Shi’a. This angered many Arabs who felt that, in fact, in 1944 the Muslims outnumbered the Christians.

Everyone was told that the atrocities committed against the Jews warranted the creation of a state. And everyone agrees, that they deserve better and should be given a state. Sadly, for the state to be created in 1948, many Palestinians had to give up their homes and people fled into Lebanon and other Middle Eastern countries. This influx is why people believed there were more Muslims (there were).


Reason #4
People think or thought that Israel was sort of footstool for the U.S., a type of armed station in the Middle East for the US, and now Lebanon was being groomed by keeping the Christians in power.

A Muslim rebellion occurred in 1958. Washington accused Moscow and attributed it to communist threats even though Syria backed the rebellion more than the U.S.S.R. Eisenhower sent troops in.

Reason #5
People realize that the U.S. was willing to protect such interests militarily. This had an impact on Muslims throughout the region.

IRAQ
I said this already, but let me repeat this one. See if it sounds familiar. In the 50’s and 60’s there was a popular Iraqi president, President Abdul Karim Qasim. He grew more bold with the U.S. and the U.K. and wanted more profits shared with his people. He threatened to nationalize the oil. Economic hit men were sent to Iraq, but it didn’t work. So then a young Saddam Hussein was part of team that was hired to assassinate Qasim. Their attempt failed; Saddam was shot and fled to Syria. Kennedy then ordered the CIA to join the MI6 to finish the job. They executed Qasim on Iraqi TV by a firing squad. Saddam came back and placed as head of national security and his second cousin became president.

I’m skipping a lot here, but Iran was promoted as a model of Christian-Muslim cooperation, and EHM’s offered the shah’s government as an alternative to those in Russia, Libya, China, Korea, Cuba, Panama, Nicaragua, etc. In selling this government, EHM’s focused on the facts that the shah broke up large private land holdings and gave them to peasants which ushered in socioeconomic reforms. John Perkins believes it was subterfuge for increasing the shah’s power and creating hegemony in the Middle East. More EHM contractual work was done in Iran after 1974.

Well, the ayatollahs deposed the shah. So we now had new leaders in Iran who were not sympathetic to our geopolitical interests: they expelled our oil companies, attacked the US embassy, and took hostages. Washington supported Saddam’s war against Iraq. We gave Saddam weapons, billions of dollars. We built chemical plants which Bechtel knew would be used for chemical weapons (like mustard gas and sarin) to kill Kurds, Shi’a rebels and Iranians. We trained his military and gave him conventional weapons and tanks. We pressured the Saudis and Kuwaitis to lend him $50 billion.

The Iranian-Iraqi war ended in 1988 with more than a million dead. US military suppliers and contractors profited greatly from the war. Oil prices were high. But Saddam, with the 2nd largest deposits in the region (behind Saudi Arabia) kept refusing to accept a similar deal to the Saudis. Saddam would have received U.S. protection as well as more supplies of chemicals and weapons. But he kept refusing. So he then became an enemy (or Iraq became an enemy) and jackals were sent in. But Saddam was hired by us in the 1980s and he understood CIA methods. The way you assassinate someone is to conspire with bodyguards. Saddam screened his bodyguards very carefully and rigorously and he employed doubles and look-alikes so the bodyguards never knew if they were guarding the right one. Since EHMs failed and jackals failed, only the military was left.


Reason #6
Bush Sr. sent in the military in 1991 (remember Saddam invaded Kuwait). They didn’t want to kill him, just reduce or hurt his military thinking so he would come around. EHMs worked on him afterwards; Saddam still would cut no deals to aid US companies and economic interests. The 2nd Bush went in and deposed and killed Saddam. Islamic militants were enraged by this especially when we all saw there was no tie or link to 9/11. People understood the influence of the Christian Right and the Israeli lobby in trying control the region, oil supplies, and transportation routes.

Since Medieval times, it seems Arabs have wanted Europeans (and now Americans) to stay away and to be able to turn their government as they see fit. Many Arabs see the American empire of the 2nd half of the 20th century as something similar to the empire building of the Crusades during the Middle Ages. So one resentment feeds the other.

Time or space doesn’t permit to continue and talk about issues like the Suez Canal, for instance, or the 1978 Camp David Peace accords in which Egypt and Israel had to earmark a large portion of the money received from the US for purchasing US military equipment. Our system thrives on the manufacture of arms, a hugely profitable business (around $900 billion a year) involving France, Russia, China, U.K., and Brazil as major players. The issues are complex here, but the name of the game is quite old in time. I’d like to take a trip to Africa to see how such empire building may have ravaged the beloved continent.

ASIA & EHMs THROUGH INDONESIAN EYES (from John Perkins’ Secret History of an American Empire)

So we spoke about the ‘63 coup against Ngo Dinh Diem in Vietnam which was supported by Kennedy. Diem was assassinated later; some think the order was from the CIA. The US built up forces in Vietnam and later we had the Vietnam war emerge as a result. It was catastrophic; Kennedy was assassinated. And Nixon was the first to begin pulling out troops from Vietnam. Nixon went with a more secret strategy (not through war) trying to prevent countries from falling under communist rule.
Indonesia was one of the countries being observed. President Suharto was a stanch anti-Communist. He killed a Communist-provoked coup in 1965 while he was head of the army and earned his reputation then. He didn’t hesitate to use force and 30,000 - 50,000 people died in battles crushing the coup. Suharto took over as president in the aftermath of the killings and arrests in 1968.
Economic hitmen were dispatched to Indonesia at that time (early 70’s) with the job of creating the economic studies to secure funding from the World Bank, USAID, and the Asian Development Bank. And this worked. The loans benefited US corporations and the rulers of Indonesia but left the country increasingly indebted, of course (if you remember the philosophy behind economic hitmen).

Official statistics reported great economic growth from the 70’s up until the Asian collapse in 1997. Economic growth of 9% (GDP) every year, solid banking sector, foreign exchange reserves of $200 billion, low inflation, etc. But remember the “results” were less than forecast (that’s how it works to keep the country indebted; you must over forecast the economic response to the loans to ensure defaulting), and when you look closely, these gains came at the cost of increased abuse of cheap labor, a proliferation of sweatshops, and the abuse of the environment by western companies given licenses to do what would be illegal in Western countries. The official minimum wage rose to $3/day but it was ignored by corporations. In 2002, 52% of the population lived on less than $2/day. Indonesia had the highest foreign debt of all Asian countries. It was at 60% of GDP from 1990-1996 (before the collapse). So all the glowing figures only described what a very small, wealthy percentage of the population was experiencing.

Sweatshops proliferated with groups like Nike, Adidas, Fila, Polo, Ralph Lauren, Lotto, Levi, the Gap, Old Navy, Reebok, etc. People lived in poverty, in slums, earning wages below the poverty line. Suharto and his dictatorship came under the eye of NGO groups condemning the serious human rights violations, violence, violations of international law, the sacrifice of democratic principles to satisfy multinational corporations and the ruling class around the president.




East Timor, ruled by the Portuguese for four centuries, is predominantly Roman Catholic (different from Indonesia) and is rich in oil and gas with gold and manganese. It declared independence from Portugal in 1975. Nine days later, Indonesia invaded and slaughtered 200,000 people. Well, documents from the National Security Archive show, now, that we (the U.S.) supplied the weapons for this invasion and that President Ford and Secretary of State Kissinger met with Suharto on December 6, 2975 and agreed to the planned attack. The Carter administration blocked declassification of the files in 1977. You can check out a 2005 interview of Joao Carrascalao (brother of former governor of East Timor) on “Democracy Now!” with Amy Goodman. There was a 25-yr pattern of deceit to keep the details of this planned invasion of East Timor from the American people.

Again you see the pattern, dispatching the military was presented as justified to halt the spread of communism; in reality the rebels were driven by a desire to be free of the Suharto regime and turning to China was a last resort. Supporting Suharto helped corporations since he had a desire to control the entire Indonesian archipelago. There are case after case of armed clashes in Borneo, New Guinea, the Molucca Islands, etc. which we (people like me) believe to secure these resource rich places for use by multi-national corporations in this northern tip of Sumatra (an oil and gas rich part of the Aceh province).

Indonesia grew and went deeper into debt to finance the demand for hotels, construction, restaurants, banking, services, etc. all for the wealthy class and foreign companies. In 1997, Southeast Asia was covered in a haze of poisonous smoke from forest fires that were out of control in Indonesia (a result of EHM-induced corruption according to John Perkins). Other ethnicities including the famous Bugi (where we get “boogimen”) had their lands taken and cultures destroyed. Then in 1998 with the worsening economic climate, Suharto took on an IMF Structural Adjustment Package. Now, this is a reason why people don’t like the IMF: the IMF recommended that he drop fuel and food subsidies and other social services to decrease spending which he of course did. This disproportionately affects the poor and the lower class. People took to the streets. The wealthy, fearing the masses, demanded change themselves! Suharto was forced out in 1998 (in May). Clinton’s administration severed ties with the Indonesian military. Then in 2004, the tsunami hit which brought the US back in. Remember that not only do friendly dictators help out US corporations or wars and invasions, but natural disasters. Tons of money is earmarked for US corporations and multinational corporations, restaurants, hotels, communication and transportation networks, insurance companies, retail chains, etc. instead of investing in local businesses, ma-and-pa businesses, local enterprises and restaurants, etc. I’m hoping to work to reverse this as much as possible when working with USAID this year.
The tsunami was especially hurtful because Aceh province had resources for which corporations were exploiting the area and the tsunami helped bolster this. There was a group in Indonesia called GAM (the Free Aceh Movement), a local organization that fought for the Aceh people to share in the profits generated from the oil, gas, and other resources, some degree of local self rule, and other rights. The tsunami wiped out their communication and transportation networks. Even though secret talks had began in 2004 between the government and GAM, and GAM had gained a bargaining position, they lost the position with the tsunami. The government flew in with fresh troops from unaffected areas and were bolstered by US military personnel and mercenaries and ex-CIA operatives. The pretext for the military was the necessary relief of disaster victims, but the goal not promoted in the media was to quench GAM. The Bush administration reversed the Clinton administrations 1999 decision to sever ties with the military and sent $1 million worth of military equipment to Jakarta in January 2005. The New York Times even reported that Washington seized on the opportunity after the tsunami, that Secretary Rice has moved to strengthen American training of Indonesian officers, and that the army’s utmost concern seems to be keeping a stranglehold on the armed forces of the Free Aceh Movement. Tired by efforts to rebuild and recover from the disaster as well as exhausted by mounting pressure from the Indonesian army and the US, GAM signed a one-sided peace treaty with the government.



When I was in high school and a college student I didn’t understand why people protested against the WTO, the IMF, and the World Bank, among others. Now, I’ve read, researched, and talked to people, and it’s amazing what you find. I can’t condone a multi-national organization/bank making countries reduce social services and food subsidies to service interest on a debt, to decrease spending, or to simply qualify to receive a loan in the first place. It’s reprehensible to do that or require for a developing country with high unemployment, poor educational and health infrastructure and human resources, and little capital. But this is what happened.
The 1997 Asian collapse was known as the “IMF crisis” if you can believe it. People blamed the IMF for “fast-track capitalism” -- eliminating restrictions on capital, encouraging privatizations, maintaining high interest rates, and attempting to hedge currency risk by pegging currencies to the dollar (I’ll talk more about this next week when we move to the Middle East and Economic Hit Men). Country after country experienced an economic collapse, and the reverberations were felt even in the U.S. if you remember.

So then the IMF came up with a rescue plan. It would offer these Structural Adjustment Packages (SAPs) similar to what was forced on Indonesia by Suharto. Each country was required to allow local banks and financial institutions to fail, largely reduce government spending, cut food and fuel subsidies and social services to the poor, and raise interest rates even higher. Countless number of women and children died of malnutrition, starvation, and disease during this time. Others suffered adverse long-term effects from lack of housing, health care, education, etc. This is when the collapse continued to grow reaching the US and North and South America and Europe (sometimes globalization hurts).

Now, check out what analysis has confirmed. The countries that refused to yield to IMF demands did the best. South Korea, Thailand, and Indonesia were hit very hard with repercussions in Laos and the Philippines. But China did not yield to IMF demands. China channeled foreign investment into factories rather than securities which shielded it from future capital flight and providing employment and other benefits. India, Taiwan, and Singapore all defied the IMF and their economies remained ok. Malaysia followed the IMF, experienced a recession, then turned its back on the SAPs and had an economic rebound.