U.S. Taxpayers' Backed IMF Loans
Sun Apr 15 17:04:55 2001
Experts At Russia Hearings
http://www.thewandererpress.com/fina.html
U.S. Taxpayers' Backed IMF Loans
Go Into Pockets Of Clinton Cronies
WASHINGTON, D.C. - Expert witnesses at
House Banking Committee hearings last week (Sept. 21st-22nd) on Russian
money-laundering through U.S. banks provided an eye-popping view of the world
of runaway capitalism as practiced today in Moscow and New York, London and
Lugano, Berlin and Beirut.
It's a world where billions of U.S. taxpayer dollars are transferred to the
International Monetary Fund and then filtered through a small number of
well-placed people - only a few dozen, in Russia, New York, Washington, and
Boston - who launder the money into private accounts on Wall Street and into the
coffers of some of the world's major banks.
A host of witnesses from government, private investigation and research firms,
former CIA and KGB agents and other authorities told the committee, whose
ranking members are Republican Jim Leach of Iowa and Democrat John La Falce of
New York, that U.S. foreign aid policy in Russia is responsible for bankrupting
the nation, facilitating the greatest plunder of the country's natural and
artistic wealth since Lenin and creating a ruthless class of gangster billionaires.
Among those testifying was noted Russia expert, journalist, and author Anne
Williamson, whose 1998 book How America Built the Russian Oligarchy reveals how
current Treasury Secretary Larry Summers, chief economist at the World Bank in
1990, passed the Russian "cookie plate to Goldman Sachs," and how
Harvard economists created the new Russian kleptocracy.
In 1992, Williamson told the committee, President George Bush initiated the
financial plundering of Russia (estimated at $400 billion by now) by sending a
corps of financial experts under the direction of Gerald Corrigan of the New
York Federal Reserve to Russia to teach the nomenklatura how to play the bond
game.
"So lush were the bond market's rewards," she said, "that
dubious market participants included the Russian Central Bank itself through an
offshore firm known as Fimaco. The involvement of the Harvard Institute of
International Development [HIID; the same outfit that brought `crash
capitalism' and poverty to Eastern Europe] honchos in the same conflict of
interest activities has already been admitted publicly and remains the object
of a Boston grand jury's scrutiny.
"According to the Russian Interior Ministry's Department of Organized
Crime, Western employees of Russian banks, Western bankers and consultants,
Russian bankers, and anecdotal evidence, other participants include certain
employees of the U.S. Treasury, of the multilateral agencies, and policy and
program consultants acting through accounts established in their wives' maiden
names with non-U.S. reporting brokerages in Moscow.
"One particularly striking aspect of
Bill Clinton's presidency," she continued, "is how aggressively his
administration worked to capture the political support of the financial sector,
offering heretofore unseen gobs of government favor. (A disproportionate number
of firms receiving OPIC guarantees, Export-Import bank lending, and IFC and
Russian Enterprise Fund participation were generous contributors to both
Clinton campaign coffers and the DNC).
"The aid program was really only an exotic venue through which to pass
public funds to select Russians of the Clintons' and HIID's choosing and to
Wall Street investment banks the Clintons hoped to entice permanently into
their orbit of supporters and contributors. In short, the Russian bond market
was the Arkansas Development Finance Authority gone international."
Following the creation of the bond market and "voucher privatization"
under the Russian ruling class, Williamson explained, "there ensued a
years-long highly criminal and oftentimes murderous scramble for hands-on
control of the enterprises. Directors stashed profits abroad, withheld
employees' wages, and after cash famine set in, used those wages, confiscated
profits and state subsidies to `buy' the workers' shares from them. The really
good stuff – oil companies, metals plants, telecoms - was distributed
essentially to seven people, `the oligarchs,' on insider auctions whose results
were agreed beforehand."
Supporting Cast
Williamson's testimony, which followed that of U.S. Treasury Secretary Larry
Summers (who predictably pleaded for continued U.S. taxpayer-backed IMF loans
to Russia) was filled out and supported in punctilious detail by other
witnesses:
Fritz Ermath, former CIA chief Russian
analyst and National Security Council official, blamed the "mainstream
media and mainstream foreign policy establishment" for the loss of U.S.
taxpayers' dollars and the establishment of Russia's billionaire kleptocracy.
The Clinton administration, he said, "bought into phony-crony capitalism
too uncritically for too long."
Richard Palmer, former CIA station chief in Europe and founder of the
Washington-based Cachet International, which specializes in international
organized crime, gave a detailed account of how 4.8 billion U.S. dollars ended
up in the pockets of a handful of Russian criminals, courtesy of the Bank of
New York.
He warned that if the Clinton administration does not investigate the
disappearance of this money and the complicity of U.S. banks and other financial
houses in the scam, "it will be following the policy that it has
established over the last seven years and which is encouraging and facilitating
the continued growth of organized crime, looting of the Russian state and at
the cost and to the detriment of the impoverished Russian people."
Arnaud de Borchgrave, noted author and director of the Center for Strategic and
International Studies, also explained how the $4.8 billion ended up in the
pockets of Russia's 18 oligarchs, and said the Clinton administration,
"like Inspector Renaud in the movie classic Casablanca, is shocked there
is gambling going on in the Kremlin."
Yuri Shvets, former KGB agent, gave a precise description of how a young
Russian financial swindler, 24-year-old Alexander Konanykhine, and his wife,
with government and KGB connections, set up the All-Russia Exchange Bank
through which he absconded with $300 million, about a third of the billion
dollars that disappeared from the phony bank front.
Shvets described for the committee how easy it was for Konanykhine to set up
operations in Washington's Willard Hotel and, working with consultants, was
able to bring into the country more than 100 other Russian "thieves"
to launder U.S. taxpayers' dollars through his phony bank.
Telling The Financial Truth
It was Williamson's testimony, however, which gave the larger story of how the
Russian money-laundering caper and the Clinton administration's complicity is
part of a bigger financial picture that goes back to the creation of the Federal
Reserve.
In extraordinarily direct language that demands extensive quotation (and cries
for a response from the public and its politicians), she explained:
"The years-long sugarcoating of what the Clinton administration's policies
have wrought in Russia is just one more lie bequeathed Americans.
"Turning to the question of the IMF and World Bank generally and their
specific roles in international finance, much needs to be said. When
libertarians say that government produces nothing, they make a serious error.
Government produces one thing in abundance - our money. U.S. paper fiat dollars
have no intrinsic value and circulate only by faith and by edict. Consequently,
the dollar in a baby-boomer's pocket is worth but the penny that was in his
grandfather's purse less than a century ago.
"But granddad's penny was one-hundredth of a gold-backed dollar's value,
while today's dollar is the product of a government-operated pyramid scheme.
Once the state slipped off the `golden handcuffs' of budgetary discipline
through the establishment of the Federal Reserve, it gained the ability to
create unlimited debt, thereby claiming for itself what before had been the
purview of tyrants - the ability to debase the currency.
"It is the slow leaching of value from the U.S. dollar, not the far lesser
sums raised by direct taxation, which has enabled the political class to
purchase votes for its re-election, The degradation of American society since
1971 is often remarked upon.
"Any pyramid scheme remains viable only so long a sits base continues to
expand and it is that fact which has driven U.S. foreign policy for much of the
past century. Since politicians and investment bankers both have an interest in
promoting deficits and in forcing taxpayers to redeem government debt, they
were quick to come to terms with new markets and natural resources from abroad.
Taxpayer-subsidized Globalism then is not a new phenomenon, but it has reached
an apogee of sorts under the guiding hand of the current Clinton
administration.
"The 1930s were the last era in which the international political and
financial elite sought advantage through control of the global economy. What
economists call `hot money' raced from one nation to the next throughout that
era, leaving a trail of competitive currency devaluations in its wake. Six
decades ago, as nation after nation was humbled by and strangled with the
manipulations of the financial world's insiders, history saw fit to serve up
Adolph Hitler.
"A world war and a score of years later, the allies established the IMF as
a prophylactic money bag to prevent destabilizing trade imbalances and
therefore, they thought, a repetition of the preceding decade's nightmare. Yet
over half a century later, the IMF, the World Bank, and their similarly
U.S.-controlled spawn - the IFC, the six regional development banks, and the
EBRD - have become 800-pound gorillas of economic distortion and, over time, of
pillage which unchecked will guarantee extensive international conflict and
broadly based anti-Americanism.
"The ascendancy of Treasury in foreign policy at the State Department's
expense is the result of a neo-mercantilist foreign policy in which enterprise
is to be subject to direction from the presidential administration it is to
serve. By expanding mandates and accelerating the use of a host of
international agencies in which the U.S. is dominant - the IMF, the World Bank,
the EBRD, the regional development banks, the IFC - and combining their efforts
with those of the Commerce Department, the Export-Import Bank, OPIC, and
USAID-financed Enterprise Funds, the Clintons succeeded in constructing an
international patronage machine in which the American executive stands supreme.
"Taking the IMF's behavior in Russia as a guide we can expect a rapid
escalation of taxpayers' liabilities in the service of failed policies.
"The `new paradigm' economy concocted by the Harvard-connected Clinton
administration appointees in the U.S. Treasury, was designed to extend the
federal government's meddling hand worldwide through its control of the
multilateral and bilateral public lenders. The overall scheme works as follows:
"Sell assistance programs on an alleged `free market' and `humanitarian'
basis by awarding government grants to those academics who can be relied upon
to supply the intellectual camouflage politicians and journalists then repeat
ad nauseam to a distracted public, move the IMF and the World Bank to target,
induce target to raise taxes, fine tune target's government banking operations,
encourage borrowing and debt creation through the target's government and
national banks, allowing IMF funding to pay yields if necessary; induce target
to privatize national property while building a flimsy, artificial
`infrastructure' for an equities market good enough to attract high risk
foreign investors. Once the target nation's government flounders, step back and
watch speculators assert discipline through a run on the target's currency. The
subsequent devaluation delivers, in turn, a flood of cheap imports to American
manufacturers and producers.
"The finishing touch on the swindle is to confiscate more money from G-7
citizens (the lion's share from Americans) to pay for what is said to be an
`essential' IMF bailout; thereby allowing Uncle Sam's IMF minions to entrench
themselves more deeply in the target's government. Taxes are raised, the
population struggles beneath indebtedness, government funding demands, and the
inevitable domestic inflation a devaluation delivers.
"Western neocolonialists then bully the target over its rapidly
compounding debt in order to extract yet more property. Once successful, the
world's insiders then turn around and deliver cheap shares from privatizations
and initial public offerings into the maw of U.S. mutual funds and portfolio
investors.
"U.S. taxpayers get hit coming (foreign aid) and going (bailouts) and
innocent foreigners' property is finagled away either from, or on account of,
inattentive and corrupt leaderships. The big winners are the world's
increasingly corrupt and cozy governing class, international bureaucracies, and
global banks.
"What U.S. policy has wrought across much of the post-cold war landscape
in a moral, political, and financial abomination based on fraud, theft, and
deceit. In Russia, the results of the Clinton administration's policies are the
perpetuation of the longest depression of the 20th century in what is
increasingly an unpoliced deadly weapons dump, the biggest swindle of national
property since Vladimir Lenin muscled the country early in the century and the
discrediting of the ideas of free markets and democracy.
"It doesn't take a conspiracy theory to observe that the downward arc of
citizens' liberties, independence, and civic competence and of American culture
generally parallels the declining value of the U.S. dollar, which has lost 99%
of its value since the founding of the Fed, and 75% of that debasement has
occurred since the last link with gold established by Bretton Woods collapsed
[under Nixon]. From that perspective, it's really not surprising that at the
end of the century, not quite a century after America instituted the Federal
Reserve and thereby began that process that would deliver the power of creating
unlimited debt to the political class, the White House is occupied by a couple
who share not so much a marriage as they do a collection of felonies."
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