Economic Coercion Examples: Tactics Revealed

Have you ever wondered how powerful nations exert control over developing countries? What tactics do they use to manipulate economies and influence political decisions?

In his eye-opening book Confessions of an Economic Hit Man, John Perkins reveals shocking economic coercion examples. He exposes the hidden world of economic hit men and their strategies to exploit vulnerable nations for corporate and political gain.

Read on to discover the unsettling tactics used by economic hit men and how they shape global politics and economics.

Debt as a Weapon

When it comes to economic coercion examples, one of the primary tactics revealed in Confessions of an Economic Hit Man is the use of debt to control nations. Economic hit men (EHMs) would craft development programs that led to massive increases in national debt. These initiatives, backed by substantial loans, were designed to boost American corporate profits while simultaneously trapping countries in a cycle of debt. This approach serves as a classic example of economic coercion in action.

The Joint Economic Commission partnership between the U.S. and Saudi Arabia exemplifies this tactic. U.S. expertise was used to create infrastructure projects in Saudi Arabia, tying the economic futures of both nations together. Countries struggling with debt repayment often became vulnerable to pressures leading to harsh economic policies, privatization of state-owned enterprises, and forced relinquishment of valuable assets to multinational corporations.

The International Monetary Fund (IMF) frequently stepped in, demanding that indebted countries exploit their natural resources and labor force to repay debts. This cycle perpetuated a pattern of control, allowing EHMs to maintain their influence over nations of strategic importance.

Fear and Division

Another key strategy employed by EHMs was the use of fear and division to enforce compliance. This approach exploited a country's financial vulnerabilities and perceived security threats, sowing discord within and between nations and communities.

During the Reagan administration, an aggressive stance on defense heightened the sense of unease. The CIA and self-proclaimed development specialists supported conservative groups while suppressing those pushing for social progress. The U.S. bolstered authoritarian regimes by providing military aid, a process that involved the strategic use of EHMs.

Operation Condor serves as a stark example of this tactic. It was instrumental in quelling dissent, bolstering autocratic regimes, and inciting internal conflicts. This resulted in numerous fatalities and the entrenchment of authority in the regions concerned.

Manipulating Economic Data

EHMs also manipulated economic figures and projections to justify their actions. They promoted an ideology that insufficient resources necessitated the aggressive advancement of corporate agendas as the only remedy for underdevelopment.

While affluent individuals benefiting from infrastructure projects skewed economic data in their favor, the wider public remained under the impression that wealth could only be amassed through capitalist practices and by taking on debt. Trade agreements like the USMCA were often lauded for making food more affordable in poorer countries. In reality, they prioritized the interests of American corporations, potentially destabilizing indigenous farming practices and intensifying economic and social turmoil.

Subverting Democratic Leaders

The book reveals how EHMs undermined democratically elected leaders across various nations, particularly in Latin America. Leaders like Jaime Roldós of Ecuador and Omar Torrijos of Panama, who resisted American corporate and government pressures, met untimely deaths in suspicious airplane crashes.

In Ecuador, Roldós implemented a hydrocarbon policy designed to safeguard the country's financial autonomy, which was perceived as a threat by those invested in the oil industry. After his death, Ecuador broadened opportunities for global companies to intensify their search for oil, hinting at the possible influence of these firms.

Similarly, General Torrijos entered into negotiations with the U.S. for control of the Panama Canal and considered building a rival canal with Japanese assistance. These actions could have threatened U.S. business interests and might have contributed to his untimely death.

Exploiting Natural Resources

EHMs aimed to harness the natural wealth of countries and suppress any local opposition. In Indonesia, the U.S. viewed President Suharto similarly to the Shah of Iran, hoping that Indonesia would align with American objectives and serve as a model of regional cooperation.

Following the chaos that led to Sukarno's removal, Suharto rose to power, highlighting the U.S. support for certain leaders to maintain dominance over crucial resources, including potential oil reserves in Indonesia.

China's Economic Coercion Tactics

While the book primarily focuses on U.S. tactics, it also sheds light on China's rising strategies of economic coercion. China has adopted core EHM tactics but with a distinctive approach:

1. Non-interference rhetoric: China emphasizes mutual benefits and avoids involvement in the internal affairs of other nations.

2. Economic engagement: Through initiatives like the Belt and Road, China cements its international influence by funding substantial projects in vital regions like Africa and Latin America.

3. Debt accumulation: Many nations have experienced economic growth due to Chinese financial support, but this has also resulted in these countries becoming ensnared in a cycle of debt.

China's swift ascent to global prominence has been marked by a focus on economic collaboration and shared prosperity. However, the sustainability and ethical soundness of this strategy are called into question by the significant debt burden shouldered by allied nations and the exploitation of their natural resources.

Personal Experiences and Moral Dilemmas

The author's personal journey as an EHM provides insight into the recruitment and grooming process. He was brought on board by a leading consulting firm and trained to coax developing countries into accepting large infrastructure loans, leading to their eventual indebtedness and dependency.

As he gained a deeper understanding of EHM strategies, the author began to question the ethics of his work. He noticed that initiatives endorsed by global entities often led to difficulties for those who were most vulnerable. This realization led to an internal struggle between the material rewards of his job and his growing moral reservations.

Ultimately, the author decided to disclose the mechanisms of EHM strategies, facing threats and attempts to silence him. His commitment to exposing the intricate and detrimental effects of the EHM system grew stronger despite the potential dangers involved, driven by a desire to transition towards an economy that supports sustainability and renewal.

By sharing his experiences, the author aims to shed light on the tactics of economic coercion and push for change in global economic practices. His story serves as a cautionary tale about the far-reaching consequences of economic manipulation and the importance of ethical considerations in international development.