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So I’m listening to KALW here in Berkeley and I’m appalled by the interview they are doing with John Perkins author of Confessions of an Economic Hitman.  The interviewer is doing the absolute worst kind of interview possible, apparently hard hitting but allowing the interviewee to present his facts without any rebuttal and ultimately ending up sympathetic to the interviewee.  Since what John Perkins was saying sounded a great deal like standard simplistic anti-corporate rhetoric dressed up in scary conspiracy theory rhetoric I figured I would do some background searching on the internet.  Unfortunately a simple google search turned up only a bunch of far left sites (hmm maybe this is just a nutty site) saying “ah ha I knew it all along,” and more uncritical interviews. So when I found some more critical information I thought I would try and give some critical context for this book (wikiepedia has a nice quick summary).

 Though given that KALW just did a little report on the inconsistencies over whether Cheney turned to the right or left before shooting his friend, disagreements between the guests over whether he had a beer at lunch, and rants about his lack of a hunting license maybe I should just stick to the more mainstream KQED (never really thought I would be saying that).  I mean jesus christ the administration is openly breaking the law to wiretap the phones of US persons don’t we have better things to worry about than whether or not Cheney was hunting quail without his $7 license.

Rather than clutter up the main page with detailed points about why what this guy says is silly I will give the one paragraph summary here and let you read the rest below. Basically this guy repeats the standard liberal rant against globalization with the extra bonus of an implausible conspiracy story that while the cheif economist at a major corporation (and in the peace corp) he was secretly working with at the behest of the NSA.  In other words it’s an attempt to whip people up into a furor to demand we not support corporations who pay low wages in foreign countries and avoid giving loans to poor countries to improve their infrastructure (though we should avoid burdening them with debt).  While things like fair trade coffee may be usefull as a way to generate additional aid critisizing call centers in India (as he does) just makes sure companies are less likely to provide jobs in these countries (and does little to prevent companies with less concern about public opinion or located in other places from exploiting weak enviornmental laws in the third world).  As someone who is deeply concerned about the welfare of the developing world and would be happy to double our tax rate and use all that money to aid the third world I find this sort of argument deeply pernicious.  It plays directly into the hands of protectionist US unions who want to (selfishly) keep jobs in the US at the expense of people in the third world.  If we believe that all people are made equal taking deliberate actions to give benefit to US citizens at great cost to people in the developing world are simply indefensible.  It is even worse when we are willing to screw over people in the third world to avoid offending our delicate liberal sensibilities (corporations/genetic engineering is bad).  Of course there are more reasonable criticisms of locating factories in the third world (though I disagree with most of them) and I will consider these elsewhere but the sort of eggregiously inflamatory rhetoric and conspiratorial gloss provided by people like this guy inflames people and falsely suggests we ought to treat the third world as some sort of cultural museum of spiritually superior indigenous ways while distracting people from looking to experts for guidance on the complex economic questions which determine how we can best help the people in the third world.

A couple days ago I heard the most egregious example of this sort of horrific willingness to let the third world suffer so people can feel smug about being liberal.  A panel of experts was talking about the problems of hunger in the third world and seemed to unanimously agree that animosity for GM food in the first world was causing people to starve in the third world.  This wasn’t a panel that was uncritically positive of GM, they agreed that giving GM food to third world persons was effectively using them as test subjects (I kinda disagree) but reasonably thought that most people would prefer to take the risk of eating GM food than starve or suffer malnutrition.  After they say this some liberal fuck-up gets up and says something like, he is worried about giving GM food to the third world because it might do violence to their traditional way of life.  I mean jesus fucking christ people are dying out there it is time to put away that hippie commune with nature/traditional cultures are filled with wisdom attitude that made you popular in college or in yoga class and help (or at least not interfere) people implement real world solutions to save them.

Whether or not you agree with me that outsourcing of jobs is in the long run beneficial to the third world at the very least you must admit that these are tough questions with people genuinely having beliefs on both sides of the issue.  The thing we most need is expert and scientific investigation of what best helps these people and the last thing we need is people clouding the issue with conspiracy theories, and inflammatory rhetoric.  One doesn’t solve the tought problems of coruption and poverty with indignation or moral outrage but with systematic research and planning and this sort of uninformed demonization of western influence and capatilism doesn’t help.

 So Perkin’s claim is basically that through his whole career he has been a secret agent of the NSA which was working through private companies to destroy the economies of developing nations for our benefit.  The supposed mechanism by which this would happen is getting them to take out loans from the world bank, diverting this money to western run construction projects that don’t help the poor and then using the countries failure to repay the loans as leverage to get them to do what we want.  This is a fairly standard criticism of world bank policy in the past several decades and contains an element of truth.  The west did often use debt as a lever to make the third world make pre-market reform sometimes (often?) with unfortunate results and it wouldn’t surprise me if we had occasionally used this to make them support our foreign policy objectives.  However, there is every reason to believe that most (all?) of this pressure was done with the genuine intent of aiding that country.  I know some extreme liberals may find this hard to believe but there are plenty of people who really think entirely free markets are to the benefit of the third world.

Of course what makes Perkin’s account inflammatory and interesting is not this grain of truth but his terminology of “economic hitman” (implying a particular intent) and his claims of covert government action.  However, the “economic hitman” terminology seems to be nothing but a snappy line to garner attentions (perhaps having origins as a black in-joke) and his claims about being a government agent seem to be pretty absurd.  As the government points out his characterization of the NSA is more appropriate for a TV thriller than fact (one would expect this to be a CIA operation if anything) and seem to be an almost paranoid reinterpretation of pretty much nothing.  Given that he has implied that 9/11 might be a US conspiracy (above link) and his other books suggest a over credulity (he seems to believe tribal shamans travel beyond time and space) he isn’t exactly a reliable source.

Ultimately his ‘argument’ seems to rest on a misinterpretation of things other people would regard as just a few greedy companies, or even helpful economic activity as some kind of economic warfare.  Just from a half hour on the air he had some pretty dizzying quotes which I will repeat here (not verbatim, memory and all).  Most amazingly he said, “At least slaves were given food, housing and free medical care people who work in sweatshops are not.”  This hardly needs any rebuttal at all.  Surely a company who locates in a foreign country and gives indigenous people the option of working in a factory in addition to their normal option of substance farming (no matter how low the wages) is not engaging in the moral equivalent of slavery.  Furthermore, though he argues that these companies are doing harm he dismisses as irrelevant the question of whether things would be worse if companies had not located in that country.  Yet this is the very heart of the dilemma.  People in the industrialized world are unfortunately only willing to give so much money in charity and corporations are not the channels through which this money is distributed.  If the countries are doing better because the companies are present on net the indigenous people are being aided not exploited.  To subject companies to criticism because they only helped indigenous people X amount instead of Y will only encourage these companies to locate in first world nations and not even help X amount.  Of course this isn’t to say their aren’t some practices companies validly deserve criticism for and there have been situations with companies truly taking advantage of the ignorance of the third world to apparently offer benefit but really cause more harm than good by destroying environmental resources but this is a standard concern and it is well known we need to keep a close eye on companies to prevent this sort of behavior (though improvement is always possible).

In fact the arguments offered by this guy display such a ridiculous misunderstanding of economics that I am inclined to think the best thing we could have done for poor countries is to tell him to wreck their economies.  Most ridiculously he criticized the location of US call centers in India on the grounds that now too many Indians are going to technical school depressing the wages of these jobs.  I don’t know about you but more Indians getting educated and a larger number of them getting employed doesn’t sound like a horrible thing, the call center jobs still pay (as I understand) significantly more than the average wage in the country.  At best this is like calling the United Way evil because it didn’t give as much money in charity this year as it did last year.  More absurd he criticized the companies who set up these call centers on the grounds that if the wages get too high in India the call centers will relocate to Indonesia.  In other words he is upset because the probabilistic system is inclined to give jobs to the worst off and when India’s wages rise someone else will be worse off.  This sounds like an optimal system not something to be ashamed of.  It certainly seems intuitive to me that once a country has a higher wage it is in less desperate need than one which has a lower wage.