The Clintons see Haiti only as a gold mine by Wayne Madsen

The Clintons see Haiti only as a gold mine

by Wayne Madsen
Another Haitian first round presidential election, held on October 25, has served to be another exercise in rampant vote tabulation fraud. Dr. Maryse Narcisse, the candidate of former Haitian president Jean-Bertrand Aristide’s political party, Fanmi Lavalas, has claimed that recent election was based on massive fraud by the Haitian government. The two people who benefit the most from Haitian election fraud and the continuation of lackeys of the United States as presidents of Haiti are Bill and Hillary Clinton.

In 2010, current president Michel Martelly claimed that his third place finish against the government-backed candidate in the first-round was the result of fraud. Martelly’s challenge was successful and he was moved up to second place finisher and in the final round he was elected president. In the most recent first round election, Martelly’s handpicked successor, Jovenal Moise, was said to have led with 32.8 percent of the vote, followed by Jude Celestin, backed by former president Rene Preval, with 25.2 percent. Third place finisher, Moise Jean-Charles, who is very popular in Haiti, was locked out of the final round.

The Clintons will do everything in their power to prevent Aristide loyalists from becoming president of Haiti. Aristide's anti-globalization policies are a direct threat to the Clintons' massive investments in Haiti.

Even though Mr. Clinton sent U.S. troops to Haiti in 1994 to restore the elected president Aristide, a Roman Catholic Marxist-oriented “liberation theology” priest who was overthrown in a September 1991 coup, Clinton’s 1994 military operation “Uphold Democracy” could be renamed “Operation Uphold the Clintons’ Wealth.” Clinton would soon double cross Aristide after it became clear that the Haitian president’s new party, Fanmi Lavalas, was heading toward the same left progressivism as Hugo Chavez’s Fifth Republic Movement, which was victorious in 1999. Clinton forced Haiti to undergo painful World Bank-imposed austerity measures, a virtual death knell for the hemisphere’s poorest nation.

In 1996, Preval, to whom Clinton took an immediate liking because of his commitment to privatize Haiti’s state-owned enterprises, was elected president to succeed Aristide. Aristide supporters in parliament clashed with the Preval loyalists. In 1999, Preval dissolved the parliament and ruled by decree for the remaining year he had in office. Preval’s actions were supported by the phony “pro-democracy” Clinton who, in 1999, was busy trying to restore his political capital after his impeachment by the House of Representatives in the Monica Lewinsky scandal, backed Preval’s unconstitutional actions.

In 2000, Aristide ran again for president of Haiti. The U.S. State Department, under Clinton’s longtime consigliere Madeleine Albright, backed Haiti’s opposition in boycotting the presidential vote, which clearly showed that turnout was over 60 percent and that Aristide won with over 92 percent of the vote.

After Aristide was overthrown in a U.S. Central Intelligence Agency-inspired and planned coup in 2004, Clinton ecstatically danced on the political grave of Aristide, who was exiled first to the Central African Republic and then to South Africa. In 2009, United Nations Secretary General Ban Ki-moon, who is owned and operated by the U.S. government, appointed Bill Clinton as the UN Special Envoy to Haiti. Clinton ensured that the populist opposition loyal to Aristide, the man he helped regain office after the 1991 military coup, remain suppressed. Aristide was anathema to Clinton’s plans to squeeze every imaginable profit from the poorest nation in the Western Hemisphere.

Clinton was able to use the “peacekeeping” United Nations Stabilization Mission in Haiti (MINUSTAH) as personal centurions to ensure that Clinton’s political and business cronies were not threatened by the populist forces of Aristide, who returned from exile to Haiti in 2011, and his Lavalas party. MINUSTAH forces targeted, and continue to target, Aristide forces in brutal attacks. Perhaps in keeping with the spirit of the sordid sexual deviancy history of the UN Special Envoy Clinton, MINUSTAH forces in Haiti were accused of various sexual crimes, including Uruguayan forces gang raping a Haitian teenage boy, a Nepalese soldier torturing to death a 16-year old Haitian boy, Pakistani officers raping a 14-year old mentally challenged Haitian boy, and Sri Lankan troops raping Haitian children. Neither Bill nor Hillary Clinton ever mentioned these outrageous actions while the U.S. president served as UN Special Envoy. Topping off these MINUSTAH crimes was the introduction of cholera into Haiti by Nepalese troops.

Secretary of State Hillary Clinton tried every trick in the book to prevent Aristide’s return to Haiti, including having President Obama apply pressure on South African president Jacob Zuma. These efforts failed. Aristide and his wife made a triumphant return to Haiti on March 18, 2011.

A year before Aristide’s return, in 2010, things got much worse for Haiti and Mr. Clinton was there to strangle the nation to an even greater degree. The 2010 earthquake decimated Haiti and killed some 300,000 people and left the country’s infrastructure in tatters. President Barack Obama, in a body blow to Haiti, Obama asked Clinton and former President George W. Bush, the president responsible for the 2004 coup against Aristide, to join Bill Clinton in Haiti relief efforts. 

Bill Clinton used the devastating Haitian earthquake, and, ironically, George W. Bush, to line his own pockets and those of his wife, brother-in-law, and other cronies with quake relief money.

Mr. Clinton launched the following high-tech appeal on the web site of his William J. Clinton Foundation: "Text 'HAITI' to '20222' and $10 will be given to the Clinton Foundation's Haiti Relief Fund, charged to your cell phone bill." Clinton also solicited for donations of up to $1000 for the Clinton Foundation's Haiti Relief Fund. Most of the millions of dollars Clinton and Bush raised in Haiti relief never made their way to the Haitian people but into the pockets of the Clinton family and their cronies in Haiti and elsewhere. The Clinton aid money that did reach Haiti was siphoned off to benefit not only Haiti’s wealthy elite but also wealthy businessmen from the neighboring Dominican Republic who were moving their operations into Haiti.

The CIA-linked U.S. Agency for International Development (USAID) and members of the Arkansas Rice Growers Association (ARGA), the latter political cronies of the Clintons, wreaked havoc on Haiti's once thriving rice growing business. Once a net exporter of highly-nutritional rice, a combination of USAID policies and one-sided Clinton-era trade deals destroyed the Haitian rice industry and made the country dependent on expensive and non-nutritional genetically-engineered bleached white rice from Arkansas agri-businesses. In 2008, the soaring price of rice worldwide and price-fixing by U.S. agri-businesses linked to Clinton resulted in food riots breaking out in Haiti. By 2010, the time of the quake, Haiti was already an economic basket case.

Just like old King Leopold, who prized his personal country Congo because of its immense mineral wealth, particularly diamonds and gold, the Clintons became highly invested in Haiti’s emerging gold mining industry. The Clintons’ investments in Haiti, which had long been protected by MINUSTAH, would soon be guarded by an Israeli company, HLSI, the vice president of which, Eva Peled, a former officer in the Israel Defense Force, also happened to be the chief executive officer of Geomines and vice president of the Mitrelli Group.

In October 2015, HLSI signed an agreement with Haiti’s government to provide land, air, and sea border security for Haiti. The Geomines/Mitrelli team are major investors in Haitian gold mining operations. To ensure it gained full access into Haiti, the Mitrelli Group lavished generous donations on the Clinton Foundation. One of Geomines partners in the Haiti mining operations, VCS Mining of Delaware, named Hillary Clinton’s brother, Tony Rodham, to its advisory board in 2013. Rodham received generous stock options in VCS that stand to make him millions of dollars if VCS strikes gold. VCS Mining’s president, Angelo Viard, has also contributed generously to the Clinton Foundation, as well as to Democratic candidates, including his advisory board’s newest member’s sister, Hillary Clinton. VCS just happened to have been awarded two gold mining permits by the Martelly government, the first issued by Haiti in more than five decades.

Haiti’s new private “army,” the Israeli firm HLSI, touts its capability to find land mines. However, the same thermal imaging technology can be used to find minerals like gold and diamonds. Hence, HLSI is concentrating its “security” efforts around Haiti’s gold mining operations.

Haiti is sensitive to the presence of Israelis in the country. Some of Haiti’s earliest slave owners were Jews, such as the Gradisse family of Cap-Haitien and Gonaives and Simon Isaac Henriquez Moron of Grand’ Anse, Haiti. Israel also secretly supplied weapons to the repressive dictatorships of “Papa Doc” Francois Duvalier and his son, “Baby Doc” Jean-Clause Duvalier. One of Haiti’s richest businessmen, Gilbert Bigio, a Syrian Jew who is also Israel’s honorary consul in Haiti, is more committed to helping Israel than his native Haiti. It was the Haitian elite, individuals like Bigio, who benefited from Bill Clinton’s earthquake relief money.

Supplementing the HLSI security protection for Clinton/Israeli business investments in Haiti are the armed guards led by Martelly’s son, Olivier Martelly. These armed thugs, reminiscent of the dreaded Duvalier-era Tonton Macoutes, are known as the “Galil Gang” because of the Israeli Galil guns they carry. In September 2015, Olivier was reportedly arrested by federal authorities in Miami on drug smuggling charges. However, the younger Martelly was said to have been quietly released after a flurry of phone calls were made that, according to Haitian opposition sources, may have involved pressure exerted by Bill and Hillary Clinton on the Obama Justice Department.

The real reason Wolfowitz is under fire

By Robert Dobrow


From the bloody ground battles in Iraq to the lush board rooms of the World Bank, U.S. imperialism’s “New American Century” is in trouble these days.

Former deputy Pentagon chief and now World Bank president Paul Wolfowitz, prince of the neocons and architect of the Iraq invasion, is knee-deep in scandal. The man who began his tenure two years ago as head of the world’s largest so-called public financial institution with calls to battle “global corruption” stands charged with peddling favors to a woman friend at the bank.

Let’s not waste any ink on this tenth-rate issue. We’ll leave it to the right-wing enablers in the mass media who have turned objective political commentary into scandal-ridden drivel to spin the Wolfowitz story as a titillating tale of sex, lies and payola.

The real story is how the Bush administration has tried to shape the World Bank into a tool of its war agenda, and the limits of its ability to force the rest of the world to bend to its will.

When Wolfowitz was appointed by George W. Bush two years ago to head the World Bank, the European business journal The Economist, staunchly rightwing and conservative, editorialized that, “His appointment tells the world that Mr. Bush wants to capture the World Bank and make it an arm of American foreign policy.”

It should be added, however, that The Economist has no problem with the World Bank as an arm of European imperialist foreign policy.

Aid as a political weapon

Wolfowitz, next to Bush, has been one of the most visible and hated figures around the world for his role in Iraq, for the lies that justified the invasion, for the torture policies of the occupation, for the arrogance and the ruthless conduct of the war.

And now as head of the World Bank, Wolfowitz has imposed a brazen pro-U.S. agenda there as well. A feature story in the April 9 New Yorker magazine by John Cassidy titled “The Next Crusade” cites numerous instances to support this view.

For instance, in July 2005, the Central Asian republic of Uzbekistan ordered the U.S. to remove its troops and aircraft from an Uzbek base it had been using to support the war against Afghanistan. Two months later, Wolfowitz cut off an aid package to the country which was mostly going to rural water and health projects. No cutoff of monies was suggested for neighboring Tajikistan, a brutally repressive but pro-U.S. regime that gets millions in World Bank loans.

Wolfowitz has selectively used the “corruption” charge to deny loans to countries that try to exert a measure of independence from U.S. influence, like Congo-Brazzaville and Chad, poor African nations with rich natural resources. Both countries were denied development aid in the past year by the World Bank.

With Iraq, however, Wolfowitz has been most active in placing the World Bank at the service of the Pentagon.

First Wolfowitz made a series of top-level appointments at the bank to political cronies of right-wing governments that had been some of the strongest backers of U.S. policy in Iraq, such as El Salvador, Spain and Jordan. “He used his tenure in part to reward those governments and individuals who were particularly helpful to the U.S. in the Iraq war,” says Steven Clemmens of the New America Foundation.

World Bank and Big Oil

Then, last fall, Wolfowitz set up a permanent World Bank office in Baghdad. According to the Bank Information Center, a liberal nongovernmental organization that monitors the bank’s policies: “The institution is advising the International Monetary Fund (IMF) in the development of the oil sector strategy. More broadly, the Bank is advising Iraq on attracting foreign direct investment through quickly developing investor friendly laws and also advising on reforming [privatizing—BD] state-owned enterprises. In addition, the Bank is participating in meetings with the IMF, Iraq Minister of Finance, and the International Tax and Investment Center (ITIC) on Iraq’s oil sector. The ITIC is a business lobby group comprised of BP, Chevron, Eni, ExxonMobil, Shell and Total.”

“Wolfowitz’s apparent determination to use the World Bank to further questionable American military goals in the Middle East is a ... violation of its founding Articles of Agreement, and a reckless waste of donor resources,” said Bea Edwards, International Program Director of the Government Accountability Project, a nonprofit public interest group and whistleblower protection organization.

“In fact, the Bank is prohibited from operating in a conflict like this,” added Edwards. “In the simplest financial terms, there is no functioning banking system, the government does not control its territory.”

The World Bank and the IMF are leaning on the Iraqi Parliament to establish a Federal Oil and Gas Council, staffed by Big Oil executives. “The new law would grant the council virtually all power to develop policies and plans for undeveloped oil fields and to review and change all exploration and production contracts,” Juan Gonzalez reported in the Daily News on Feb. 21. The Iraqi National Oil Co. would be defenseless against these foreign companies.

“Since most of Iraq’s 73 proven petroleum fields have yet to be developed, the new council would instantly become a world energy powerhouse,” Gonzalez wrote. Contracts with international companies will likely be similar to controversial production-sharing agreements, which sign away the lion’s share of oil profits to foreign investors.

The World Bank was formed in 1945 with the specific intent of projecting U.S. power in the post-war era. The bank’s president is always from the U.S., the bank’s headquarters are in Washington, and the U.S. has a permanent veto. It is under fire in many countries around the world for the severe austerity measures that it forces upon developing nations, including demands for privatizing industries and looting national resources and native industries for the sake of foreign capital.

But the World Bank in the past has also been a coalition effort by U.S., European and Japanese capital, with significant bank funds provided by non-U.S. sources.

Today, however, the Bush administration and its big business masters are not interested in coalitions. They demand total control. This is nowhere better revealed than in the infamous document co-authored by Wolfowitz himself seven years ago titled “Rebuilding American’s Defenses.” This manifesto of the so-called Project for the New American Century has been called the “Mein Kampf” of the neocon movement. It projects a world of U.S. global domination, calling for massive increases in military spending, for covering the planet with Pentagon bases, for a near-permanent state of military readiness, and for regime change wherever U.S. capitalism’s political and economic interests are threatened.

But this reactionary utopia is collapsing on the ground in Iraq, where popular resistance to U.S. aggression continues to grow. And while we would much rather see Wolfowitz brought up on charges of war crimes than on a two-bit misdemeanor for influence peddling, the fact is that his woes at the World Bank are yet another sign that the Bush administration is on the defensive and unable to impose its will on an unwilling world.

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Chomsky Takes on the World (Bank)

Michael Shank | May 16, 2007

Editor: John Feffer


Foreign Policy In Focus
www.fpif.org


Noam Chomsky is a noted linguist, author, and foreign policy expert. On April 26, Michael Shank interviewed him about the conflict between Congress and the U.S. president over Iraq and Syria, the scandal enveloping World Bank head Paul Wolfowitz, and the nature of foreign debt.

Michael Shank: Given that the U.S. Congress is no longer calling for binding timelines for troop withdrawal, how is this indicative of a broader struggle between the executive and legislative branches?

Noam Chomsky: There are a number of issues. One is the unitary executive conception. The Republican Party happens to be right now in the hands of a very extreme fringe. That goes from the legal system and the Federalist Society to the executive and so on. What they basically want, to put it simply, is a kind of an elective dictatorship. The chief executive should have total control over the executive branch. And the executive branch should dominate the other branches. That’s an effective mode of authoritarian control, natural for those whose dislike of democracy goes beyond the norm.

There’s a real fascist streak there, definitely. And Congress, to some extent, is trying to recreate more of a balance between the executive and legislative branch. So that’s part of the struggle. Part of it is just that neither party is willing to face the consequences of a withdrawal from Iraq. It’s not a trivial matter. First of all, there’s almost no public discussion of the issues involved in the war. Why did we invade? Why don’t we want to get out?

Shank: Right, it is minutiae now; it is troop numbers, timelines, etc.

Chomsky: That’s right. I was listening to the National Public Radio tribute to David Halberstam the other day, and they had on Neil Sheehan, David Greenway, and others. They were talking correctly about these young reporters in Vietnam who with great courage stood up against power and told truth to power. Which is correct, but what truth did they tell to power? The truth they told to power was: "you’re not winning the war." I listened through the hour and there were never any questions like: should you be fighting the war or should you be invading another country? The answer to that is not the kind of truth you tell to power.

In fact, it’s rather similar to what critical journalists in the Soviet Union were saying in the 1980s. They were saying, “Yeah we’re not winning the war in Afghanistan.” From my point of view, that’s not telling truth to power. Truth to power would be: why are you invading Afghanistan, what right do you have to commit crimes against peace and against humanity? But that question never came up. And the same is true in the discussion of Iraq. The question of whether it’s legitimate to have a victory doesn’t even arise. In fact, the current debate about Iraq reminds me very much of the dove/hawk debate over Vietnam.

Take, for example, Arthur Schlesinger, leading historian, Kennedy advisor, and so on. He was originally a strong supporter of the war during the Kennedy years. But by the mid-1960s, there was a mood spreading in the country generally, but also among the elites, that the war is not wise, it’s harming us. Then he had a book that came out in 1966 called Bitter Heritage, which is very much like what’s happening today. He was one of the extreme liberal critics of the war by then. He said, “We all pray that the hawks will be correct in thinking that sending more troops will bring us victory. And if they are, we’ll be praising the wisdom and statesmanship of the American government in winning a victory in a land that they’ve left in wreck and ruin. But it doesn’t look like it’s going to work.”

You can translate that almost verbatim into the liberal dove critique of the war today. There’s no question about whether we are justified in invading another country. The only question is: is this tactic going to work, or is some other tactic going to work, or maybe no tactic and it’s costing us too much. And those are the limits of the presidential debates, the congressional discussion, and the media discussion.

That’s why you can have debates such as those going on now about whether Iran is interfering in Iraq. You can only have that debate on the assumption that the United States owns the world. You couldn’t debate in 1943 whether the Allies were interfering in occupied France. It was conquered and occupied by a foreign power. Who can interfere in it? In fact, it’s the right thing to do, interfering. Or, say, Russia’s Afghanistan: is the United States interfering in Afghanistan while the Russians conquered it? You’d crack up in laughter if you heard that question.

Those are the limits of discussion here. That’s part of the reason the outcomes of the debates are so inconclusive. The issues are not discussable.

First of all there is the issue of legitimacy. Invading Iraq was the kind of crime for which Nazi war criminals were hanged at Nuremberg. They were hanged, primarily, for crimes against peace, i.e. aggression, the supreme international crime. Von Ribbentrop, foreign minister, was hanged. One of the main charges was that he supported a preemptive war against Norway. It’s kind of striking that at the end of the Nuremberg tribunal, the chief counsel for the prosecution Justice Robert Jackson, an American justice, made some pretty eloquent speeches about the nature of the tribunal. After the sentencing, he said, “We’re handing the defendants a poisoned chalice and if we sip from it we must be subject to the same charges and sentencing or else we’re just showing that the proceedings are a farce.” So if they mean anything the principles have to apply to us.

Try to find a discussion of that anywhere, either in the case of Vietnam or in the case of Iraq, or any other aggression.

Shank: Another schism opened up recently between the two branches with Cheney’s comment that Pelosi’s trip to Syria was bad behavior. Do you think Pelosi has a right to speak to Syria?

Chomsky: Of course she does. If you don’t believe in an elective dictatorship, everyone has that right, even the local congressman, even you and I. If it’s a free democratic country you don’t have to follow the orders of the dear leader. The whole discussion is ridiculous. And the fact that she has to defend herself is ridiculous.

The question is: are we living in an elective dictatorship? Or is it supposed to be a free country in which people pursue their interests?

Shank: How much will that [unitary executive] foundation shift if/when the Democrats take over the executive branch in 2008? Will it be more open?

Chomsky: It’ll be more open, but I don’t think there will be fundamental changes. The basic fundamentals are shared by the parties. But the Bush administration happens to be on the very extreme end of a pretty narrow spectrum. So if liberal Republicans were in [the White House] it would also change. The mainstream Democrats by now are kind of liberal Republicans. It’s very hard to make a distinction.

So sure, it would soften the edges. The parties have different constituencies, and you give something to your constituency. The Democratic constituency is more of the general population, the working people and so on. So you give something to them and maybe less to the super rich. But the framework of thinking is almost the same.

Shank: Is the foundation on which the current unitary executive stands beginning to erode? Given the corruption charges facing Paul Wolfowitz at the World Bank, the scandal surrounding Alberto Gonzales, the Justice Department’s firing of attorneys, and the indictment of Scooter Libby?

Chomsky: The struggle over the unitary executive and the elective dictatorship… that’s beginning to erode from internal corruption primarily, not because what it did was wrong. Yes, of course, some of things were wrong, like firing a prosecutor, but that is so minor compared to the array of crimes committed by the administration. It gains its significance because of the conflict over legislative and executive powers.

Take Wolfowitz. The charges against Wolfowitz are maybe correct but pretty minor compared to his record. Forget his involvement in the Iraq war, let’s put that aside, though it was surely significant. He was the ambassador to Indonesia under Reagan. He was one of the strongest supporters of Suharto, who was one of the worst monsters in the modern period, comparable to Saddam Hussein. When Wolfowitz was appointed to the World Bank, Indonesian human rights and democracy activists were bitterly critical because he never lifted his finger to help them when he was ambassador. In fact, he harmed them and they explained how he did it.

Here’s a man who strongly opposes democracy, who strongly opposes human rights. That’s not the myth. The myth is his great ideals. But in his actions, he supported a hideous dictator and in fact he supported extreme corruption. Transparency International ranked Suharto’s Indonesia as the world champion in corruption. This is the man he was defending while at the same time saying that he was going to the World Bank to do something about corruption.

His record with regard to democracies is also outlandish. You may recall in Turkey, to everyone’s surprise, the government went along with the will of 95% of the population and did not let U.S. troops use the country as a base for the war against Iraq. There was bitter condemnation of Turkey in the United States, from Colin Powell and others. But the most extreme was Wolfowitz. He berated the Turkish military for permitting this to happen. He said, “look, you have power, you can force the civilian government to do what we want them to do. The idea that they should listen to 95% of the population is outrageous.” Then he demanded that Turkey apologize to the United States and in fact say that it understands its job to help the United States. A couple of months later he was being hailed as the “idealist-in-chief” leading the crusade for democracy.

Shank: So why is he going down now for a salary?

Chomsky: He’s very much disliked in the Bank. Apparently he’s very authoritarian. So they picked an issue on which to expel him: a kind of corruption issue and a governance issue. And that’s okay. It’s good to see corrupt people go down. But those are not the issues. It’s just like in Iraq or Afghanistan.

Shank: Analysts in the media are questioning whether or not the Bank can redeem itself post-Wolfowitz. Can it redeem itself or is it done?

Chomsky: Redeem itself from what? Through the 1970s, the World Bank and the International Monetary Fund were pressuring countries to take loans, borrow, and create huge debt. They argued that it was the right thing to do. In the early 1980s, with the Volcker regime in Washington, the whole system collapsed and the countries that had taken the debts were hung out to dry. Then the World Bank and the IMF pressured them strongly to introduce structural adjustment programs -- which means that the poor have to pay off the debts incurred by the rich. And of course there was economic disaster all over the world.

That’s the World Bank. They’ve done some good things. I’ve seen some World Bank projects that I think are great. For example, in Colombia the World Bank has supported very interesting projects run partly by the church, partly by human rights organizations. They are trying to create zones of peace, which means communities that separate themselves from the various warring factions and ask the military, paramilitaries, and guerillas to leave them alone. The people that are doing that are very brave, honorable people. It’s very constructive work, and it’s supported by the World Bank.

So again, I think that’s good. But if you look at the overall range of the Bank’s policies, it hasn’t been benign by any means. The Bank would have a long way to go to “redeem itself.”

Shank: So it’s the same problem facing Iraq, the whole conversation is wrong?

Chomsky: The conversation is too narrow. Within the narrow framework, yes, it’s a good thing to get rid of corruption and press for good governance. But there’s a much wider framework…

Shank: …that’s not being talked about.

Chomsky: Right. Take the IMF. The IMF is not the World Bank, but it’s closely related. The IMF’s former U.S. executive director Karin Lissakers accurately described the Fund as the credit community’s enforcer. The IMF is very anti-capitalist. For example, suppose I lend you money. And I know that you’re a risky borrower, so I insist on a high-interest rate. Now, suppose that you can’t pay me back. In a capitalist system, it’s my problem. I made a risky loan. I got a lot of profit from the interest. You defaulted. It’s my problem.

That’s now what the IMF is about. What the IMF is saying, to put it in personal terms, is that your friends and neighbors have to pay off the loan. They didn’t borrow the money, but they have to pay it back. And my friends and neighbors have to pay me to make sure that I don’t lose any money. That’s essentially what the IMF is.

If Argentina takes out an IMF loan with huge interest rates because it’s risky and then they default, the IMF comes along and says the workers and peasants and other people in Argentina have to pay for that. They may not have borrowed it, it may have been borrowed by a military dictatorship, but they have to pay it back. That’s what structural adjustment is. And the IMF will ensure that western taxpayers pay off the bank. It’s radically anti-capitalist, whether you like that or not. The whole system has no legitimacy. In fact the whole debt system in the world, which is crushing much of the world, most of it is fake debt.

If Suharto, one of the biggest debtors in the world, borrows money and ends up the richest man in Indonesia or maybe the world, why is it the responsibility of the farmers in Indonesia to pay it off? They didn’t borrow it; they didn’t get anything from it. They were repressed, but they have to pay it off. And the IMF makes sure that the lenders don’t lose money on their risky loan after making a lot of profit from it. Why should the system even exist?

Shank: The micro version of that in the United States with sub-prime lending is coming back to bite us pretty quickly.

Chomsky: Exactly.

Shank: Are we going to have that kind of awareness on the global scale? Because I think people are realizing that sub-prime lending isn’t working.

Chomsky: It’s bad because vulnerable people were exploited. But at least you can say that the sub-prime borrowers did borrow the money. In the South the people didn’t borrow the money. It was their leadership that did. What do the people of Indonesia have to do with Suharto borrowing money from the Bank?

Take Duvalier in Haiti. He fled with U.S. help, with most of the treasury. Why do the people of Haiti have to pay off the debt? Most debt is just illegitimate. In fact, the United States itself has instituted an international regime that regards these debts as totally illegitimate. They’re called odious debts. It’s the notion that the United States introduced when we “liberated” Cuba. The United States didn’t want to pay off the debts to Spain, so they were dismissed accurately as illegitimate, later called odious debts. The people of Cuba had no responsibility for them.

A huge amount of the debt in the global south is odious debt. Why should anybody pay it?


Michael Shank is a doctoral student at the Institute for Conflict Analysis and Resolution at George Mason University and a frequent contributor to Foreign Policy In Focus (www.fpif.org).