Anwar Ibrahim: Wolfowitz's Knife in Asia's Back

On Sept 1,1998,Dr Mahathir shocked the world by breaking all the rules of IMF orthodoxy,imposing selective currency controls,ending speculation in the ringgit (the national currency) by pegging it to the dollar-and firing Anwar Ibrahim. Anwar and a handful of followers went on a rampage,attempting to carry out a popular revolt to overthrow Dr Mahathir.

Despite open support from neo-conservative in the West,including especially U.S Vice President Al Gore and Secretary of State Madeleine Albright,Anwar's "people's power" revolt went nowhere,and he soon found himself in prison,convicted of abuse of power and morals charges.

The results are well known. Despite the screams from the IMF and the Anglo-America banking institutions,that Dr Mahathir was leading Malaysia down the road to Hell,that his nation would soon find itself destitute,cut off from the "responsible" world,and would likely find itself begging for the IMF to come to its rescue,the opposite occurred.

While all those nations subjected to IMF policies suffered social crisis and a massive increase in poverty,Malaysia alone among the Asian countries attacked by the speculators retained social stability and relative economic well-being.

The devastation in neighboring Indonesia was the worst,as the currency was driven down to a third of its former value,tripling the country's huge foreign indebtedness virtually overnight,while poverty rates exploded.

The Indonesian economy has only partially recovered still today.Even the IMF admitted (although long after the fact) that the vicious austerity and credit contraction policies it had imposed on the desperate government of Indonesia hadbeen a terrible mistake.

Embrace of the IMF and Wolfowitz

On the occasion of Anwar's recent apperearance at SAIS, EIR asked him the following question : Even the IMF has acknowledged that its prescriptions for the Asian economies after the speculative attack of 1997-98 only made the crisis worse. Your policies for Malaysia after the attack were well known to be consistent with those of the IMF,until they were reversed by Dr Mahathir's currency controls,and your simultaneous removal from office.

Are you also now willing to admit that,had your policiesbeen followed,the result would have been a disaster foryour country?"Anwar's response,and his presentation generally,indicate that he is not primarily interested in regaining any position of trust or leadership within his own country,or even within the party which was created in order to build support for him after his arrest,Parti Keadilan Rakyat.

Rather,he is embracing,by name and with littlereservation,the persons and the policies of the much hated (in Malaysia and else where) George Soros,the architect ofglobal speculation; Paul Wolfowitz,the leading promoter of pre-emptive war; and the bankrupt and discredited IMF.

"I was right,of course," proclaimed Anwar. He claimed that he had some differences with the IMF, "the way the country was spending had to be addressed,whether they were among the IMF prescriptions or not.

" He said that it was "beneficial" for the IMF to come intoMalaysia and discuss their ideas. He expressed support for the IMF's denunciation of all major infrastructureprojects,as wasteful "megaprojects," as if their only valuewere to provide financing for the "cronies" who were involved in the construction.

The Bakun Dam was singled out for condemnation. Hacknowledged that he had circulated Soros's papers topolicymakers,and had defended Soros when Dr Mahathirdenounced him as a thief and a moron. And,on the success of Dr Mahathir's program in saving Malaysia from the fate of its neighbors,Anwar said:

"Yes,the growth was robust,the people escaped poverty-but that was all on the surface [!]. Underneath,there was corruption,no transparency,authoritarian leaders,and nofree media."

Most disturbing,even to his supporters in Malaysia,was Anwar's effusive praise of Wolfowitz. In a Bloomberginterview in Hongkong on March 18,Anwar welcomed the Wolfowitz appointment to head the World Bank,saying that Wolfowitz "passionately believes in freedom,and understands that issues of poverty,environment degradation,living conditions and health issues which are very much a World Bank agenda.

"While people in Iraq may find this characterization less than amusing,Anwar is careful to explain that he was not a supporter of the U.S invasion of Iraq. Nonetheless,he displays how far he is willing to go in defense of theneo-conservatives who are sponsoring him,by adding: "But I don't believe that war was directed against the Muslims or the Iraqi people."

The Deputy President of Anwar's Keadilan Party, Dr Syed Husin Ali,rushed to distance himself from this embrace of the hated Wolfowitz. "He is an advisor," Syed Husin told the online opposition news service Malaysiakini on April 18,referring to Anwar.

"He can give advice to us,but he cannot determine the party's polivy," he said, insisting that Anwar's backing of Wolfowitz was only his personal view,and did not reflect the party's position.

Turning Indonesia Against Malaysia

The clue to Anwar's intentions (or rather,the intentions of Wolfowitz,with the assistance of Anwar) were revealed in his attempt to set Indonesia against Malaysia. Indonesia's democratic transformation since 1997 crash,said Anwar,has been the "most important development in the Muslim world in this century. " Although many people describe Malaysia as a model of a successful,democratic Islamic nation,said Anwar,this totally wrong. Malaysia is a dictatorship,even after Dr Mahathir's retirement,he insisted,while the true model of Islamic democracy is Indonesia.

Ironically,Anwar admitted that Indonesia was in dire need of economic growth and an end to corruption,but the contradiction did not seem to concern him in the least.

In an interview in The Age of Australia on March 21,Anwar described the devastation following the speculative destruction of the Asian economies in 1997-98 as a positivedevelopment, "a gale og creative destruction that shook the complacency of Asian societies and the governments."

The tie to Australia is significant.

The Australia government of Prime Minister John Howard is closely allied with the Bush Administration on all strategic matters,andis participating in the Wolfowitz effort to woo the new Indonesian government of President Susilo Bambang Yudhoyono to ally with the neo-conservative regimes in Washington and Canberra,in exchange for military deals and investments.

Howard has induced Yudhoyono to support Australia's effort to be included as a founding member of the East Asian it (EAS),when it is launcheh later this year. This is strongly opposed by Malaysia and China, among others,and thus puts

Indonesia at odds with Malaysia.

Howard,however,has most likely poisoned any chance Australia may have had to be admitted to the EAS,when he refused to sign the Treaty of Amity and Cooperation with ASEAN,even though it has been signed by Japan,China,South Korea,and India,among others.

The Treaty forswears the use of military aggression against other co-signers. Howard,like the Bush Administration,refuses to give up the right to pre-emptive military intervention against his neighbors,a threat which no nation can afford to ignore in the Bush/Cheney era.

Wolfowitz presents himself as a "friend of Indonesia," using his experience as Ambassador to Indonesia in the 1980s as evidence of his competence to run the World Bank. "People in Indonesia have a different view of me" from that of this critics, Wolfowitz told Bloomberg News on March 18.

While Anwar contrasts Indonesia's democracy to the supposed dictatorship in Malaysia,Wolfowitz often contrasts Indonesia to the Islamic natio s of Southwest Asia,to justify U.S military adventures to bring "democracy" to the Arabs.

Wolfowitz served as Ambassador to Indonesia from 1986 to 1989,while hot money was pouring into the country,leading to significant development andrelative prosperity-and a good reputation for Wolfowitz.

However,a was painfully learned after 1997-98,the foreign contracts which brought about this development were of the "economic hit man",variety,since the entire risk had been imposed on the Indonesian side.

Enron and other power companies,for instance,succeeded in getting guarantees from the Suharto government (usually with a member of the Suharto family involved),that the government would purchase the full capacity of power plants whether or not it was needed or used,while it was to be purchased in dollar-denominated prices.

The foreign debt was.also to be paid in dollars. When the speculators destroyed the Indonesia currency and economy in 1997-98,the nation's debt tripled overnight,while the government was forced to purchase unneeded electricity a triply-inflated prices.

The memory of Wolfowitz as a friend of Indonesia darkened a bit. His subsequent role as architect of the imperial war on Iraq turned it to black. For Wolfowitz to imagine that he is still admired in Indonesia,is as far from reality as Anwar's fantasy that the neo-conservatives will win him a place of respect in Malaysia.