All News Is Lies: Darkest Peru
S A N D E R S R E S E A R C H A S S O C I A T E S
by John Laughland
June 2, 2003
At least the foreign investors are happy - or so Allan Wagner claims. The Foreign Minister of Peru was defending the decision, taken on 28th May, to declare a state of emergency in the South American state. It is the second time in less than a year that the President of Peru, Alejandro Toledo, has had to bring the army out onto the streets: the last time was last June, when Toledo responded to three days of violent protests in the Southern province of Arequipa by introducing a panoply of measures allowing the government to arrest people without charge, to prevent demonstrations, and to search homes without a warrant.
This time, the state of emergency is nationwide. It mean military rule in at least 12 out of the country's 24 provinces, under the benevolent control of the Vice-President and Minister of Defence, David Waisman. Within the first few hours of the military rule, 95 people had been detained and 40 injured in violent clashes with the police and army.  But, at Mr. Wagner helpfully explained, the state of emergency would pacify foreign investors who wanted social, political and economic stability.  Investors and the international community, he said, wanted a country in which the President of the Republic and his Ministers exercised authority for the benefit of public order and the rule of law.
Representatives of the business community rushed to agree. The Associated Press quoted "Samuel Gleisner, a prominent business leader" saying, "It's the best showing by Toledo so far." The head of the Lima Stock Exchange, Rafael d'Angelo Serra, expressed the same view, saying that investors should interpret the word "emergency" not to mean "alert" but instead "order". He claimed that the Peruvian stock exchange was had risen by 30% a year in dollar terms this year, and that it would probably top a 100% rise by the end of the year. By the same token, an analyst from Bear Stearns said, "Foreign investors are not worried about politics or social pressure because they are totally convinced Peru is strongly tied to the IMF."  They are right - Alejandro Toledo used to work for the World Bank, and his wife is a private banker.
Indeed, it is precisely because Peru is so strongly tied to the IMF that the protests have been so massive. Last June's state of emergency in Arequipa was called to suppress mass demonstrations against the privatisation of the state electricity company: some 100 people were injured and many shot. The electricity was to be sold off to Tractebel, a Belgian company (President Toledo's wife, Eliane Karp, is Belgian) but the deal was eventually called off. No doubt the people of Arequipa know that citizens from Lithuania to Georgia have learned - that "privatisation" means selling of state utilities to foreigners for a song, who hike the prices up and cut off those who cannot pay. The president of Lithuania is even now trying to change the law so that pensioners can have their heating cut off.
This year's demonstrations are even bigger. The combined protests of farmers, health workers, members of the judiciary and 300,000 schoolteachers came close to being a general strike. As happened last year, the state of emergency declared last week prohibits people from assembling in public; it has also declared the teachers' protest illegal. They must return to work in six days or face the sack. The farmers, for their part, had done what farmers in Poland and France regularly do: they had set up road blocks around the country to protest against cheap foreign imports of agricultural produce. There is also a powerful lobby of coca growers who are determined to prevent the government from destroying the coca crop.
The state of emergency in Peru is noteworthy because they come on the tail of similar violent clashes in another South American country with a pro-US government, neighbouring Bolivia, where 20 people were killed and 100 injured last February when the army and police put down protests against IMF-imposed tax hikes on workers' salaries. As in Bolivia, moreover, and as Wagner's remarks suggest, the state of emergency is being driven principally by business considerations. For this very reason, both uprisings received scant attention in the media, and our prediction is that the Peruvian state of emergency will achieve almost no television coverage whatever. Contrast this with the saturation coverage given to the management organised workers' lock-out, universally and mendaciously presented as a strike, which occurred in Venezuela last December. There, the president, who came nowhere near to getting the army to implement his employment policies, is universally denounced as a dictator.
The state of emergency in Peru therefore recalls the one which recently ended in Serbia, another client state in which the West's concerns for universal human rights seemed to vanish as thousands were being rounded up. Powers which Slobodan Miliosevic was denounced for putting on the statute book, but
which he never used, were welcomed as essential for protecting democracy when used by the post-Milosevic government. And Alejandro Toledo, like Zoran Djindjic, is a model New World Order politician: so completely did he come from "nowhere" in 2000 that he was born either in a port town  or high up in the Andes,  according to whom you ask. The fairy-tale story of "shoe-shine boy turned politician" was rather like the claim that President Vojislav Kostunica had translated the Federalist Papers into Serbian - as unsubstantiated as it was much repeated. Underneath the Hollywood shlock and his embarrassing tendency to dress like an Andean peasant for the TV cameras, the main point about Toledo was that he worked for the World Bank, and that he was married to a powerful Belgian banker. He is, to put it bluntly, a front man for a lot of very powerful and horrible people. Mrs Toledo, aka Eliane Karp, a graduate of the Hebrew University of Jerusalem, was accused last year of secretly drawing a salary of $120,000 a year from a bank while claiming to work "22 hours a day for the poor of the country". The bank in question, Banco Wiese Sudameris, was in turn accused of transferring money amassed by the former head of the Peruvian security services, Vladimiro Montesinos, to Switzerland. And Montesinos, who played a key role in getting rid of Fujimori even though he is now on trial for murder and conspiracy, had in turn received at least $10 million from the CIA at a time when his boss, the former president, was still in favour with Washington. The Peruvian first lady has protested her innocence.
The investors are happy with the imposition of military rule now for the reason given by the head of the stock exchange. The official economic statistics from Peru show over 5% growth. But if the country is booming, why are public sector workers like farmers on the streets in their hundreds of thousands? A lot of foreign funny money is probably flowing into Peru, snapping up state industries and utilities, and maybe this is driving the stock prices up. But I have seen so many examples of Eastern European countries slumping into unimaginable poverty, while The Financial Times and The Economist babble happily about their booming growth rates, to have any faith in such macroeconomic figures. Inflation is supposed to be under control in Serbia, but everyone you talk to blanches when they tell how expensive everything has become. How is this possible? Quite simply, inflation figures include things like washing machines and DVD recorders which most people cannot afford, and which in any case they purchase only once every few years. In the real lives of real people, by contrast, price rises in food, electricity, heating and things consumed every day affect the poor very considerably.
In other words, a when a foreign "investor" says a country is doing well, what he means is that he is doing well. I recall a conversation with such a man at breakfast in a hotel in Zagreb, who told me excitedly about the investment opportunities which had opened up in Croatia following the death of President Franjo Tudjman, whom the West hated. When I asked him sceptically which sectors of the economy were expanding, he looked a little embarrassed and admitted that the "opportunities" were in reality funds from the European Union which were being made available, mainly for Western companies rather than local ones, now that the government was compliant. So bad have things got in Peru, indeed, that last year, Toledo, who was installed by Washington only in 2000, very nearly lost the presidential election to a clapped-out old Socialist Alán García, whom I first remember from a trip to Peru in 1985, when he came to power on an anti-poverty slogan. Economic reform has evidently bitten so deep that Peruvians are really scraping the barrel - anything to get rid of Toledo.
One of the principal forces of opposition comes from coca farmers. The head of the farmers' union, Nelson Palomino, was arrested in April for "terrorism"; under his successor, Nancy Obregón, the farmers were organising a massive march on Lima, with thousands of them pouring into the capital at the beginning of May. In an interview with Narco News, Nancy Obregón accused CARE Peru, the local branch of CARE International, of having paid the people who arrested Palomino. If true, this is a good example of the abusive behaviour of non-governmental organisation, which are one of the preferred vehicles for political influence by the West in poor countries. They were used massively to get Toledo elected in the first place, with various self-appointed bodies popping up to say that the elections would be rigged even before they had occurred. Popular suspicion at the role of these bodies may be what prompted Allan Wagner to say, on 9th May, that the role of NGOs "ought not to be demonised". He was referring in particular to the role of a shadowy organisation called Transparencia, which played a key role in overthrowing Alberto Fujimori three years ago.
Fujimori was a quite remarkable president. Some years ago in Paris, I met his Vice-President, Francisco Tudela, whose brother is a friend of mine. Seldom have I met a more charismatic or intelligent man: I can only assume that Fujimori himself was also a man of very considerable talent. My acquaintance, Francisco, was subsequently caught up in a siege by the Tupac Amaru guerrillas at the Japanese embassy in 1996-1997, which was broken only after a long stand-off. When Peruvian special forces finally stormed the building, the Sendero guerrillas shot at Francisco "like a rabbit" - in his words to his brother - as he tried to hide under a table. He was wounded in the foot but survived. Interestingly, Alejandro Toledo was one of the few people in the embassy at the time to be released by the guerrillas before the end of the siege. Under his presidency, the Peruvian authorities, with quite disgraceful chutzpah, have charged the former president, now a fugitive from Peruvian "justice" in Japan, with complicity in murder because the guerrillas were all shot dead.
Fujimori had, by contrast, distinguished himself by capturing the head of the Sendero Luminoso, Abel Guzman, and putting him in a cage. As if by coincidence, Fujimori's eradication from the Peruvian political scene - on the same vague charges of "corruption" which were used to get rid of Josef Estrada in the Philippines and Slobodan Milosevic in Serbia - has led to reports that the Sendero is back on the rise again in Peru. He must have contacts with them. But Fujimori's success in the fight against terror counted for little when he started to baulk at the privatisation of certain state assets, like the water company, fearing that their sale to foreigners would lead to considerable price hikes in charges to ordinary people. Fujimori therefore joined Viktor Orbán in Hungary and Václav Klaus in the Czech republic, two prime ministers who went from being darlings of the West, and the US in particular, to becoming demons of reaction overnight, because they, too, started to get awkward about privatisation. Fujimori was eventually overthrown by systematic acts of violence orchestrated by Toledo, backed by Washington. These are the same mechanisms which have been deployed in Albania, Serbia and Zimbabwe. So now we have in Peru what we have all over the Balkans, and what we are evidently getting in Iraq: a combination of military rule, extreme poverty, and the rise of very serious networks of organised crime. Now, that's progress!
 El Comercio, Peru, http://www.elcomercioperu.com.pe/online/ 29th May 2003
 El Expreso, Lima, http://www.expreso.com.pe/expreso/hoy_dia/index.html , 29th May 2003
 "Strikes plague Peru's President Toledo", by Missy Ryan, Reuters, 27th May 2003
 http://www.ndi.org/support/events/toledo/toledo.asp - Google Cache Copy
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