How To Build A Neocolonial Empire
The American playbook that enslaved many nations
Hi there,
Everyone has a vague sense of how the US has bullied, bashed, and butchered its way to the top.
But few understand that there’s an insidious, empire-building process at work that isn’t just content with gaining power- but seeks to keep smaller nations trapped & enslaved.
This is the process that America (and now China) has deployed to become a global hegemon.
But how does it work? We can turn to Confessions of An Economic Hitman to find the gory details. Here’s what John Perkins, the man behind this exposé, has to tell us.
Through the second half of the 20th Century, the US has used something called debt-trap diplomacy to ensnare small, resource-rich nations in its web to expand its global empire. Here’s how the process works:
The Scheme: Find a nation that is resource-rich and not economically advanced or part of the Western bloc. Create a narrative that “If you want to grow, take loans from the World Bank/IMF, use our construction/engineering firms to build infrastructure, and submit to neoliberal policies”. This is the Washington Consensus and was used to seduce many countries into these arrangements which later turned out to be traps.
Uncle Sam driving “economic development” EHMs: Use economic hitmen to produce exaggerated growth forecasts (for example, Indonesia can achieve a 15% growth rate if they take this ginormous loan from us and use it to build electricity infra). Then WB/IMF use these to lend them huge amounts of money, which go back to paying American companies like Bechtel, MAIN, and others to undertake the infra development projects (leading to nosebleed profits and super-rich executives). But what happens to the countries?
The Default: The pain begins. The countries are obviously not able to pay back their debts because the forecasts were so damn exaggerated in the first place. It was all a giant scam from the beginning, designed to ensure that the countries default on their debt obligations. And that’s when Uncle Sam enters the room for his pound (or metric ton) of flesh.
Bleeding Them Dry: To make up for the default, these countries are forced to compensate by allowing the US to build military bases in their countries, giving up power over their UN votes, and offering their precious resources (like oil and metals), at cheap ass rates.
The Other Option: And what if the country, knowing the disgustingly raw deal it’s getting, refuses to cooperate? This has happened in a bunch of cases- Panama, Ecuador, Guatemala, Iran. The result is always the same: a regime-change operation.
Case Study: In Guatemala, where the American United Fruit Company was making crazy money, a new democratically elected president (Jacobo Arbenz) decided to enact land reforms as 3% of people owned 70% of the land. Most of it was owned by United Fruit, and they were particularly ruthless in their dealings. Naturally, Arbenz was a big pain in the scrotum for the company, so they decided to wage a massive PR campaign against him in the US, calling him a communist and stoking fears, which led to— you guessed it— Arbenz’s assassination and the bombing of the country’s capital. He was replaced by a puppet, and UF could continue milking the country dry.
Perfecting the Process: Roldos, the president of Ecuador, tried to push out oil companies. They didn’t like it and followed the same SOP described- calling him a dangerous commie and stoking fears. Lo and behold, Mr. President died in a mysterious plane crash, and the next president turned out to be a major buddy of the oil cos. (What a surprise, no?) News of his death haunted Torrijos, the President of Panama, who had similarly stood up to American interests and retained control of the Panama Canal. He had nightmares of falling from the sky. Unfortunately, those prophecies turned out to be true- just 2 months later, he died in a plane crash. The control of the canal went back to the most pious nation on Earth.
Manufactured Enemies: The process of overthrowing a government and installing a subservient puppet always relies on the existence of a deadly enemy they can blame. In the 20th Century, communism was the perfect scapegoat, using which the US embarked on adventures from South America (as pointed out above) to Southeast Asia (Vietnam and Indonesia). In the 21st century, those enemies changed to Muslim terrorists, immigrants, or anyone threatening the rule of corporations.
The Nexus: This entire strategy is possible due to collusion between the US government, international institutions like IMF & WB, and big corporations like oil and engineering firms- all of whom profit from the enslavement and ransacking of poor, resource-rich nations. It also benefits the dictators/puppet presidents and a small group of elites in the target nation who get a slice of the loot, while the majority of the nation endures even worse suffering as debt defaults lead to austerity: reduction of public spending on education, basic services, etc.
Destruction: What’s worse, the deal allows US firms to mine, dig, or drill for resources with 100% impunity- they can do whatever they want regardless of the environmental and humanitarian consequences. After all, they’re owed their pound of flesh after engineering the default. This leads to poisoned rivers, ecological destruction, tribal displacement, and deepening poverty & disease. Thus, a few top-ranking white male executives enjoy Martinis at The InterContinental, while billions breathe sulfur, slave away in mines, wash themselves in fecal rivers, and live their numbered days in huts.
And that’s how the American neocolonial system built a modern empire- by enriching a few, enslaving everyone else, and subjecting entire countries to perpetual debt slavery.
China, much like the US before it, is using a familiar strategy to entrench its global dominance. Through its Belt and Road Initiative, China offers massive infrastructure projects to resource-rich nations, tying them to unsustainable loans. When these nations inevitably default, China takes control of key resources and strategic locations, solidifying its power.
While the Chinese approach is more direct and unapologetic, it follows the same pattern as America’s empire-building methods. Both superpowers use economic manipulation to trap smaller nations in cycles of debt and dependence.
However, there is hope.
As the world becomes more aware of these exploitative systems, decentralized technologies and alternative financial models provide a chance to break free.
The future lies in our ability to challenge this cycle, rejecting empire-building in favor of true sovereignty and cooperation for a more sustainable and equitable world.
The choice is ours: continue down the path of domination or embrace a new era of global self-determination.
That’s it for today folks. If you enjoyed it, you’ll also like:
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