Confessions of an Economic Hit Man

He crossed one leg over the other. “In order to do that we need to build up an economic base that is like none in this hemisphere. Electricity, yes—but electricity that reaches the poorest of our poor and is subsidized. The same for transportation and communications. And especially for agriculture. Doing that will take money—your money, the World Bank and the Inter-American Development Bank.”

Once again, he leaned forward. His eyes held mine. “I understand that your company wants more work and usually gets it by inflating the size of projects—wider highways, bigger power plants, deeper harbors. This time is different, though. Give me what’s best for my people, and I’ll give you all the work you want.”

What he proposed was totally unexpected, and it both shocked and excited me. It certainly defied all I had learned at MAIN. Surely, he knew that the foreign aid game was a sham—he had to know. It existed to make him rich and to shackle his country with debt. It was there so Panama would be forever obligated to the United States and the corporatocracy. It was there to keep Latin America on the path of Manifest Destiny and forever subservient to Washington and Wall Street. I was certain that he knew that the system was based on the assumption that all men in power are corruptible, and that his decision not to use it for his personal benefit would be seen as a threat, a new form of domino that might start a chain reaction and eventually topple the entire system.

I looked across the coffee table at this man who certainly understood that because of the Canal he enjoyed a very special and unique power, and that it placed him in a particularly precarious position. He had to be careful. He already had established himself as a leader among LDC leaders. If he, like his hero Arbenz, was determined to take a stand, the world would be watching. How would the system react? More specifically, how would the U.S. government react? Latin American history was littered with dead heroes.

I also knew I was looking at a man who challenged all the justifications I had formulated for my own actions. This man certainly had his share of personal flaws, but he was no pirate, no Henry Morgan or Francis Drake—those swashbuckling adventurers who used letters of marque from English kings as a cloak to legitimatize piracy. The picture on the billboard had not been your typical political deception. “Omar’s ideal is freedom; the missile is not invented that can kill an ideal!” Hadn’t Tom Paine penned something similar?

It made me wonder, though. Perhaps ideals do not die, but what about the men behind them? Che, Arbenz, Allende; the latter was the only one still alive, but for how long? And it raised another question: how would I respond if Torrijos were thrust into the role of martyr?

By the time I left him we both understood that MAIN would get the contract for the master plan, and that I would see to it that we did Torrijos’s bidding.

CHAPTER 14. Entering a New and Sinister Period in Economic History

As chief economist, I not only was in charge of a department at MAIN and responsible for the studies we carried out around the globe, but I also was expected to be conversant with current economic trends and theories. The early 1970s were a time of major shifts in international economics.

During the 1960s, a group of countries had formed OPEC, the cartel of oil-producing nations, largely in response to the power of the big refining companies. Iran was also a major factor. Even though the shah owed his position and possibly his life to the United States’ clandestine intervention during the Mossadegh struggle—or perhaps because of that fact—the shah was acutely aware that the tables could be turned on him at any time. The heads of state of other petroleum-rich nations shared this awareness and the paranoia that accompanied it. They also knew that the major international oil companies, known as “The Seven Sisters,” were collaborating to hold down petroleum prices—and thus the revenues they paid to the producing countries—as a means of reaping their own windfall profits. OPEC was organized in order to strike back.

This all came to a head in the early 1970s, when OPEC brought the industrial giants to their knees. A series of concerted actions, ending with a 1973 oil embargo symbolized by long lines at U.S. gas stations, threatened to bring on an economic catastrophe rivaling the Great Depression. It was a systemic shock to the developed world economy, and of a magnitude that few people could begin to comprehend.