The bestselling author and whistle-blower recounts past US efforts to control the Panama Canal, and assesses the threats of a looming Trump administration: “I would be worried.”
John Perkins was listening to NPR in late December when he heard a report that disturbed him.
President-elect Donald Trump had threatened to retake the Panama Canal, reportedly out of concern about China’s potential influence over the waterway, and because he was upset about Panama charging excessive rates to use the passage.
“It’s pretty bad,” Perkins, a former chief economist for the Boston strategic-consulting firm Chas. T. Main, said in a recent interview with the Boston Institute for Nonprofit Journalism.
Perkins, 79, said that Trump’s threat is likely a negotiating tactic. (Days after we spoke, the POTUS-elect suggested that he might use military or economic force to achieve such an outcome in Central America.) At the same time, Perkins has seen what happens when Latin American leaders reject US interests. He detailed those experiences in his revealing bestselling 2005 memoir, Confessions of an Economic Hit Man.
World leaders who Perkins worked with back in the day included then-Panamanian head of state Omar Torrijos, who successfully negotiated with President Jimmy Carter to regain control of the canal from the US in 1977. In 1981, Torrijos died in a plane crash. Perkins and others believe that he was assassinated by the Central Intelligence Agency.
In 1987, a CIA spokesman denied the claim to the Washington Post, saying, “We do not engage in assassinations.” But regardless of what happened back then, Perkins said that current Panamanian President José Raúl Mulino should take Trump’s threats seriously.
“I would be worried if I were him,” he said.
Progression of an economic hit man
As recounted in his book, Perkins grew up in New Hampshire, earned a degree in business administration from Boston University, and was offered a job with the National Security Agency. He turned it down in favor of the Peace Corps, where he met the vice president of Chas. T. Main, who later hired Perkins as an economist in 1971.
While that was his official title, Perkins would later refer to himself as an economic hit man. In his bestseller, his description of the position sounded like something straight out of a Bond movie.
“Economic hit men (EHMs) are highly paid professionals who cheat countries around the globe out of trillions of dollars,” Perkins said. “They funnel money from the World Bank, the U.S. Agency for International Development (USAID), and other foreign ‘aid’ organizations into the coffers of huge corporations and the pockets of a few wealthy families who control the planet’s natural resources. Their tools include fraudulent financial reports, rigged elections, payoffs, extortion, sex, and murder. They play a game as old as empire, but one that has taken on new and terrifying dimensions during this time of globalization.”
More specifically, Perkins would produce inflated economic growth forecasts for what were then poor countries, including Ecuador, Iran, Saudi Arabia, and Panama. His goal was to get leaders in these places to agree to accept massive loans from the World Bank and the USAID, as well as other groups, which would be used to pay US corporations to build infrastructure such as roads, powerlines, and industrial parks.
These corporations would profit, and a few families in each country would enrich themselves, but the citizens would never see much in the way of improvements. In many cases, weak and developing nations would then be stuck with debt burdens they couldn’t pay back. As a result, they became beholden to the US and its interests.
When these leaders didn’t play ball, Perkins said, the CIA would send in “jackals” to overthrow—or even assassinate—the economic adversaries. When that didn’t work, military intervention often followed.
Perkins’ book spent more than 70 weeks on the New York Times bestseller list, sold more than two-million copies, and was published in at least 35 languages. However, he has had detractors who have said the loans that he convinced countries to take were to their benefit. Others have challenged the accuracy of his memoir, most notably Einar Greve. A literal and figurative power broker who hired Perkins at Charles T. Main, Greve claimed that some claims in the book were fiction, but in 2005 also conceded that the premise of his story is accurate.
“I would say that, allowing for some author discretion, basically his story is true,” Greve told the Citizen. “What John’s book says is, there was a conspiracy to put all these countries on the hook, and that happened. Whether or not it was some sinister plot or not is up to interpretation, but many of these countries are still over the barrel and have never been able to repay the loans.”
Details aside, Perkins got results, and by 1972 he had been promoted to chief economist. He was living in Back Bay at the time, and recalled that his boss, Bruno Zambotti, summoned him to his office at the Prudential Center.
“You’ve done an excellent job,” Zambotti told him. “To show our appreciation, we’re giving you the opportunity of a lifetime, something few men ever receive, even twice your age.”
Perkins was heading to Panama.
A long history of US interest in the Panama Canal
Control of the canal has been a controversial topic since before it was constructed. The US negotiated the Hay-Herrán Treaty with Colombia, which controlled Panama at the time, in 1903, according to the US Department of State narrative. The agreement granted the United States the rights to land surrounding the proposed canal, but the Colombian Senate refused to ratify it.
That same year, US President Theodore Roosevelt supported the Panamanians in their efforts to gain independence—and he had the canal in mind. As the State Department puts it: “His support paid off, and on November 18, 1903, the United States signed the Hay-Bunau-Varilla Treaty, establishing permanent U.S. rights to a Panama Canal Zone that stretched across the isthmus.”
The canal opened in 1914, but many Panamanians questioned the arrangement in place. Per the official State Department record: “As the 20th century progressed, tensions between the United States and Panama over U.S. control of the Canal grew. … In 1964, a riot between U.S. residents and Panamanians … led to a brief interruption of diplomatic relations between the two countries.”
The United States and Panama reached agreements on three treaties regarding the canal in 1967, but due to “political uncertainty, the negotiations suffered a major setback.”
How Reagan set the tone for Trump’s canal push
The mission: convince Panamanian head of state Omar Torrijos to drop his insistence on turning US canal ownership over to Panama. Perkins explained that he dispatched to the country to soften the leader’s encouragement of nationalistic movements throughout Latin America.
Over multiple presidential administrations in the 1970s, control of the canal remained a touchy and erratic issue. Jimmy Carter worked with Torrijos; Ronald Reagan, on the other hand, called Torrijos a “pro-Communist” “friend and ally of [Cuban President Fidel] Castro” who “threatens sabotage and guerrilla attacks on our installations if we don’t yield to his demands.” Then the governor of California running against Carter for the White House, Reagan offered arguments with a similar ring to Trump’s recent rhetoric, though slightly more nuanced.
“The Canal Zone is not a colonial possession,” the Gipper said. “It is not a long-term lease. … It is sovereign United States territory, every bit the same as Alaska and all the states that were carved from the Louisiana Purchase. We should end those negotiations and tell the General [Torrijos]: we bought it, we paid for it, we built it, and we intend to keep it.”
Perkins had his work cut out for him. He said that he met with Torrijos privately a few times during his time in Panama, and was invited by the general to parties and events that he attended. In one instance, the former hit man said that he was on a yacht with the embattled head of state. Surrounded by women in beach attire sipping cocktails, the general turned to Perkins and taught him a lesson in economics.
“This was a very, very important moment for me,” Perkins recalled. “He said to me, You know, John, you’re lying to yourself and the world when you say that increasing GDP is helping everybody in the country. It isn’t, not in Latin America anyway. It’s helping the rich get richer, because GDP reflects how well the rich are doing.”
It was enlightening. And then, Torrijos offered him a job.
“At some point in the conversation he says to me, Why don’t you come and work for me? You won’t make nearly as much money, but you’ll feel good about what you’re doing. And then he kind of sweeps his hand around these bikini-clad women and says, And you’ll have a lot more fun.”
Perkins rejected the offer, but made a secret agreement with the Panamanian leader, according to his book. Perkins said he promised Torrijos his economic forecasts would be honest, not inflated, and would take the poor into account. In return, Torrijos would award Perkins and business interests that he was aligned with the development contracts they sought.
“These contracts were indeed a first—to provide innovative master plans that involved agriculture along with more traditional infrastructure sectors,” Perkins said. “I also watched from the sidelines as Torrijos and Jimmy Carter set out to renegotiate the canal Treaty.”
Advocating for a Panamanian-controlled canal
On Sept. 19, 1975, Perkins wrote a column in the Boston Globe supporting Panama’s efforts to take control of the canal.
“The best way of assuring the continued and efficient operation of the Canal is to help Panamanians gain control over and responsibility for it,” Perkins wrote in the piece, which surprised his bosses and impressed Torrijos. “In doing so, we could take pride in initiating an action that would reaffirm commitments to the cause of self-determination to which we pledged ourselves 200 years ago.”
Many of his colleagues were upset about the public stance, but Perkins said Zambotti saw it in a good light. He recalled that his boss suspected it would make people in Latin America happy, and therefore benefit his businesses. “Next time you go down there, take copies of the article and show it to people in Panama and elsewhere,” Perkins said Zambotti told him.
Perkins returned to Panama soon after. As he tells it, one morning he was in the lobby of his hotel reading a magazine article about how noted British author Graham Greene was writing a book about Torrijos. As it turned out, Greene was staying in the same place, and had read the Perkins op-ed in the Globe. When Perkins asked how he discovered it, the writer responded, Because Omar Torrijos is waving it around.
In 1977, Torrijos and US President Carter signed two treaties—the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal, also known as the Neutrality Treaty, and the Panama Canal Treaty. The former stated that the US could use its troops to defend the Panama Canal against any threat to its neutrality, which would allow for perpetual usage. The second treaty stated that the Panama Canal Zone would cease to exist on Oct. 1, 1979, and the canal itself would be turned over to the Panamanians on Dec. 31, 1999.
Plane crashes, intrigue, and US aggression in pursuit of the Panama Canal
In 1981, both Torrijos and Ecuadorian President Jaime Roldós Aguilera, who Perkins also worked with, died in plane crashes within three months of each other. Despite persistent CIA denials, Perkins has argued that the tragedies were hardly coincidental.
“Their deaths were not accidental,” Perkins wrote in his book. “They were assassinated because they opposed that fraternity of corporate, government, and banking heads whose goal is global empire. We EHMs failed to bring Roldós and Torrijos around, and the other type of hit men, the CIA-sanctioned jackals who were always right behind us, stepped in.”
In his interview with BINJ, Perkins acknowledged that he had no proof of CIA assassinations. “I don’t know that,” he said. “I suspect it, and a lot of other people suspect it. The evidence points that way, but there’s never been a smoking gun.”
Torrijos was succeeded by Manuel Noriega, who had helped the general rise to power and considered him a mentor. Noriega is reported to have spied for the United States early on in his career, but in time came to famously oppose outside interference. The BBC explained that by 1989, with Noriega facing a US indictment for drug trafficking and embattled among other allegations, “the once close relationship between Noriega and the US had deteriorated to the point of no return.”
Subsequent diplomacy or a lack thereof paved the road leading up to the predictable imperialism of Trump’s new Panama play. In 1990, US President George H.W. Bush announced the regrettably named Operation Just Cause, sending more than 20,000 troops to invade the country and seize control of key military installations. In retrospect, Perkins said that Noriega was unfit to lead, but noted that the violence the US government unleashed to remove him was uncalled for.
“He probably should have been removed from office, but we firebombed the city,” Perkins said. “US forces went in … and … we made no bones about it. … We firebombed … a very poor area where a lot of people lived. … The estimates are that [as many as] 2,000 civilians were killed. There’s a lot of debate on how many were killed depending on who you talk to, but a lot of civilians were killed and … in my opinion, there was no reason for that.”
Donald Trump puts Panama (and Greenland) on notice
Since Trump initially announced after the 2024 election that he has an interest in taking back control of the canal, the issue has escalated. Panamanian President Mulino countered that control of the passage is not up for negotiation, and denied that China interferes with canal operations, as the Trump team has charged.
“There’s nothing to talk about,” Mulino told reporters. “The canal is Panamanian and belongs to Panamanians. There’s no possibility of opening any kind of conversation around this reality, which has cost the country blood, sweat, and tears.”
Trump, meanwhile, hosted a media availability of his own. Asked on Tuesday in a lengthy press conference at his Florida Mar-a-Lago estate if he would rule out the use of military force to regain control of the Panama Canal—and Greenland, which the 47th US President is also eyeing—he said, “No, I can’t assure you of either of those two.”
“The Panama Canal was built for our military,” Trump said. “I’m not going to commit to that, no … It might be that you’ll have to do something.
“We need them for economic security.”
What comes next in Trump’s bid to control the Panama Canal
Perkins reiterated that he thinks Trump might be posturing: “I think what he’s doing is negotiating to get lower tariffs for US shipping.”
“That’s kind of the way Trump works,” he added. “[He] makes these huge threats and then uses them as a negotiating tool. I think he’s doing that with China with the 100-percent tariffs, Canada and Mexico with the 25-percent tariffs, and now [with] the Panama Canal.”
If Trump made a serious movement or gave a command to repossess actual physical control of the canal, Perkins said nations around the world—particularly China—would react strongly. “I can’t imagine that Trump would be that foolish to start something like that,” Perkins said. “So again, I have to believe that he’s just using this as a negotiating tactic.”
Perkins added that the Panamanians have operated the canal very successfully. Furthermore, they obtained it through a legitimate treaty with President Carter, and it’s on their land.
“The best defense is to get the message out there that you’re scared,” Perkins said, “for the Panamanians to get their message out there that they’re scared—and that they’re going to resist.”
“I want to believe that [Trump] is going to do some things that’ll turn out for the best,” the confessed economic hit man said. “I want to believe that, because there’s no point in believing anything else until we see what he actually does.”
