The Debt that Obama and Clinton Owe to the Haitian Poor

Under the leadership of President Woodrow Wilson, who would subsequently be awarded the Nobel Peace Prize, the United States pursued the established policy of “stabilizing” the Caribbean under American control. In 1912, since neither Wilson nor his Secretary of State, William Jennings Bryan, knew anything about Haiti, they asked John H Allen, the American manager of the Banque nationale in Port-au-Prince, to brief them. Bryan’s reaction to Allen’s description of Haiti was, “Dear me, think of it! Niggers speaking French.”

Historians do not lack for such racist or imperialist utterances from American business, political, and military leaders who have intervened in Haitian affairs over the last century. But we should see that Bryan’s reaction reveals also the class assumptions of the conversation. That the banker Allen was describing the Haitians as French-speaking reminds us that he was dealing with the Haitian elite who had already laid claim to the profits that resulted from the hard work of male and female Creole peasants. Allen was in Haiti as part of the National City Bank of New York’s successful takeover of the Banque nationale that housed the government treasury. I want to follow the money: a material representation of the work of those peasants.

Small groups of peasants working in remote, isolated areas of Haiti had been able (in good times) to subsist on their holdings and sometimes produce small surpluses of coffee, cocoa, and sisal. Those surpluses were exported by the French-speaking elite and produced, in turn, a tidy sum of money, a good portion of which was stored in the vault of the Banque nationale in Port-au-Prince. No one ever made any money in Haiti until the peasants went to work. The ability of Haitian peasants to produce a small surplus was the reason that John H Allen was in Haiti in the first place. Wall Street and Washington were partners from the time of the first important American intervention in Haiti a century ago. That alliance is even more entrenched today. In fact, it is possible to trace the finances behind America’s corporate Democratic presidents, Bill Clinton and Barack Obama, directly to the labour of the Haitian peasants. Rather than acknowledging those peasants for their financial contributions to their public and private lives, those two presidents have dedicated themselves to further impoverishing an already destitute people. Let’s see how.

Roger L Farnham, vice president of both the Banque nationale in Haiti and the National City Bank of New York, became the adviser of Secretary of State Bryan on Haiti. Since 1910, Farnham’s main objective had been to force the Haitian government into receivership, legitimating American control of customs revenue. As president of the National Railway of Haiti since 1913, funded through National City Bank, he was also involved in a dispute with the Haitian government over the railroad that he had contracted to build from Port-au-Prince to Cap-Haitien for $33,000 per mile. National City Bank was demanding full payment. The Haitian government stopped payment in 1914 since the Railway had constructed only the sections of the railroad on flat ground, ignoring the difficult mountainous routes. Moreover, the work completed was so shoddy, according to the Haitian government, as to be of dubious value.

Unlike the leaders in the Dominican Republic next door, the Haitians refused to give up their economic sovereignty to the American banks. And so William Jennings Bryan and Woodrow Wilson found a threadbare excuse to invade and occupy Haiti. The aggression was made easier since Germany and France, America’s rivals for control of Haiti, were fighting their own European war for empire. In 1914, before the actual invasion, Secretary Bryan sent the marines to liberate the Banque nationale of $500,000 and to deposit it in the National City Bank of New York. There is little evidence that the Haitian, French-speaking, mulatto elite would have used that money for the welfare of the peasants, but it was the result of their work nevertheless.

The United States had difficulty finding someone in Haiti to call president who would be willing to sell the country after the invasion of 1915. However, in 1922, Louis Borno was inaugurated as client-president and days later the National City Bank of New York was awarded the contract to refund the Haitian debt. It sold sixteen million dollars of thirty-year Haitian government bonds on the American market. The bonds were backed by Haitian government revenue, ensuring that very little capital would be available for domestic development, but that whatever surplus Haitian peasants might produce should go to profit the National City Bank of New York and its bondholders. Moreover, Americans playing the market now had a reason to demand that the United States protect “American interests” in Haiti. Meanwhile, the Haitian government fell into the hands of ever more subservient puppets while the American marines slaughtered thousands of Haitian peasants who refused to be re-enslaved. The occupation became untenable and the Americans left in 1934. By then, the proceeds of the peasants’ work had been appropriated twice: once by the Haitian elite and then by the Americans for the National City Bank of New York.

In the 1970s, the National City Bank of New York became Citibank and its holding company Citicorps. (In 1998, it would become Citigroup as a result of an illegal merger, sanctioned by Clinton’s White House.) It rose in the world of finance, never to my knowledge thanking the peasants of Haiti who continued to live in dire poverty and to furnish the national elite the surplus produce from their otherwise subsistence farming practices.

In 1975, an executive of Citibank named David Edwards offered a trip to Haiti to a promising young politician who had just lost his bid for the Congress. Thus, Bill and Hillary Clinton visited Port-au-Prince for the first time. Clinton says in his autobiography that Edwards paid for the trip with frequent flier miles. However, since that program was not introduced until years later, Edwards clearly paid for the trip with real funds, which one way or another came from Citibank. In other words, the Haitian peasants helped to finance the Clintons’ honeymoon at the Mentana Hotel in Port-au-Prince. Clinton’s obfuscation suggests that he knew while writing the lines what facts needed to be massaged for posterity.

David Edwards was not wrong: Clinton was and remains a very slick politician. As president, Clinton deepened his relationship with those same peasants in various ways. In his negotiations that led to President Aristide’s return to serve out the time remaining in his mandate, after having been overthrown by the CIA and members of the Haitian elite in 1991, Clinton required that he adopt neoliberal measures that forbade him to act in the interests of the peasants and urban poor who had elected him to develop social services and infrastructure. Consequently, in the final months of his first presidency, Aristide was not able to continue the reforms he had begun in 1991. Meanwhile, Clinton named Robert Rubin to the position of Treasury Secretary, where he oversaw the deregulation of the Bank Holding Company Act and portions of the Glass-Steagall Act that would lay the groundwork for the financial crisis of 2008. Although he had resigned as Treasury Secretary and was in negotiations to head Citigroup, Rubin continued to be involved in the passage of the bill.

Undaunted by the ruthless alliance of certain elements of the Haitian elite and American corporate, political, and military power, Aristide and the impoverished peasants and urban poor combined to take office again in 2000 with a fresh mandate and the same goals. This time, George W Bush was in the White House and, with the help of the governments of Canada and France, Aristide was again removed – with much less finesse, but the same results.

Ever growing, Citigroup became the first American bank with assets of more than one trillion dollars. Barack Obama was the top recipient of Citigroup campaign contributions for the 2008 presidential election. SourceWatch reports that Citigroup received an initial October 2008 bailout of $25 billion and another identical sum along with with guarantees to cover $306 billion of their assets after the election of Barack Obama. Also in 2008, Co-Op America singled out Citigroup for its role in precipitating the on-going financial crisis by lobbying for looser regulations of the banking industry. Clinton and Obama reward the executives of Citigroup; the executives of Citigroup reward Clinton and Obama. All together, they are doing very well. Haitian peasants, whose labour has contributed historically to Citigroup’s phenomenal rise in the world of global finance, were still working for 35 gouds a day in 2008. That same year, Vikram Pandit, the CEO of Citigroup, earned $38,237,437 in salary, stocks, and options. A single Haitian peasant would have to work hard, every day, for 89,539 years to earn that sum. Pandit and his political allies are deemed worthy of their salaries and status precisely because they ensure that whatever passes through the hands of the poor finds its way to Wall Street, where a little of it can ensure that collaborators sit in the White House. Obama, appearing to be a champion of the poor and a sign that race no longer structured American life, was the dream candidate for Citigroup.

Under American corporate presidents like Jimmy Carter, Ronald Reagan, Bill Clinton and the Bushes, even the subsistence agricultural base was undermined in Haiti. Those presidents facilitated the ability of American agribusiness to dump highly subsidized produce into Haiti, undermining the little chance that peasants had to accumulate a few extra gouds and ensuring that Haitians would become dependent upon the United States for their very lives. Conditions deteriorated to the point that migration to Port-au-Prince was the only option. The 1983 documentary Bitter Cane exposes the euphoric response of American businessmen to the presence of a desperate workforce so close to the United States. Haitian peasants, especially under the Carter-Reagan-Jean-Claude Duvalier alliance, adapted to life in the slums of Port-au-Prince.

After the earthquake of 2010, there was an exodus of desperate Haitians from the city. Already, they are coming back in droves. Why? We have traced the rise in the world of finance and politics of those who parlayed the fruits of Haitian peasant labour into the largest bank in the United States. Meanwhile, what happened to the descendents of those peasants whose sweat was transformed into gold in the vaults of New York City?

My first sustained experience of Haitian peasant society was in the spring of 2006 when Moise, a friend from Port-au-Prince, invited me to his birthplace in the mountains high above the town of Tiguav that would be very close to the epicentre of the earthquake and is now in ruins. After the quake, Moise fled Port-au-Prince to return to Tiguav. However, like hundreds of thousands of others, he has now returned to the city. His experience helps me to understand the difficult choices faced by all residents of Port-au-Prince.

In 2006, a rickety bus from Port-au-Prince dumped Moise, our two Haitian friends, and me near the mountains that we would have to scale. Our threadbare duffle bags carried everything we needed for the week: cans and bottles, clothes, and my books. We could just make out the three palms trees that marked Moise’s part of the mountain that he jokingly called the fourth floor, about three hours away if we didn’t dawdle. There are no roads or paved walkways through the mountains, only footpaths that had first been traced by the ex-slaves who overthrew the French over two centuries ago. Moise disappeared for a few minutes and came back leading a peasant youth by the hand who, in turn, was leading his donkey by a rope. The young man agreed, on behalf of his donkey, to lug all of the bags up to the top of the mountain for 100 gouds (about three dollars). I protested that it was a ridiculously small sum to carry everything we had up hills so steep that you could sometimes stretch your arm out in front of you and touch the ground. Moise’s eyes steeled. He took me by the arm and led me a few steps from the peasant youth. “No! You can’t pay them more than that. They don’t know how much people get paid in Port-au-Prince. If they find out, they’ll be demanding more all the time.” He spoke with such insistence that I gave in.

Halfway up the mountain, in conversation with the delightful young peasant and out of sight of Moise, I slipped him a few more coins. He couldn’t hold back a chuckle and I asked him to explain. He confessed that another peasant had hired him to take his honey to market in Tiguav for fifty gouds. Then Moise had given him 100 gouds to climb back up the mountain (where he was going anyway) and now I was giving him twenty more. He had made 170 gouds for walking with his donkey to Tiguav on a beautiful day, whereas he would have made only thirty-five gouds for working in the fields from sun-up to dusk. He laughed out loud, telling me that this was the most profitable day he had ever had in his life.

There was a common understanding that Moise would bring some money to his family members when he visited from Port-au-Prince. This dynamic surprised me, a Canadian from Montreal. Up until then, Moise represented the desperate poverty of Haiti for me. Moise spoke only Creole, had no formal education, and worked for a demanding employer in Port-au-Prince for a miserable salary. I was beginning to understand how he fit into his world. From time to time, members of his family – sisters, cousins, etc. – would come to Port-au-Prince expecting something. I know that these visits made Moise anxious because he had very little to offer. Nevertheless, he tried to fill his assigned role as a source of money to people who had none otherwise.

When his job came crashing down with the earthquake, he left immediately for the mountains. His family lived only a few kilometres from the epicentre and even those whose small dwellings had not fallen refused to go inside. He soon found that his role had not changed. However, now he had nothing whatever to offer and no hopes of any salary. He soon felt resented in the community, since he had no means of helping them in the way that they had come to rely upon him. Moreover, he had become used to life in Port-au-Prince and felt that he had lost his agricultural skills. Now, he represented another – largely unproductive – mouth to feed. After a week, he decided to return to Port-au-Prince and try to find a new job that would allow him to fill the role that others expect of him and he has come to accept for himself.

Like everyone on the streets of Port-au-Prince, my friend Vilmond is debating the current situation from morning to night with other survivors. He encountered an employee of the Ministry of Culture who was arguing in favour of decentralization: the capital was full of people with nothing to do who should return – or be sent – to the provinces. She exempted herself from any decentralization program since she had a job in the capital. After the quake, she sent her five children back to her native region of Gros Morne. She told Vilmond that the only condition under which she would return there was if the provinces had even rudimentary social services: education, hospitals, and some basic infrastructure. Vilmond says that her attitude is almost universal. People migrated from the provinces for a reason: there’s nothing there. It’s beautiful, but dirt poor. Moreover, many have become urbanized and cannot imagine how they might fit into rural Haitian society.

Economist Fred Doura calls the Haitian countryside a pre-capitalist society. He shows that my experiences in a couple of mountain communities are representative of Haiti. The economy is based on agricultural subsistence. The peasants work very hard to cultivate steep mountain slopes. They are paid negligible salaries but there is little to buy. For centuries, their meagre surplus was exported to enrich the elite. Doura also shows now the neoliberal policies promoted by successive American administrations have kept the Haitian countryside impoverished, impeded domestic development, and precipitated even greater misery. That there are no social services is a result of neoliberal policies forced on vulnerable populations everywhere.

Clinton has been telling the Haitian diaspora that his main qualification for his role as United Nations’ Special Envoy to Haiti is his success in managing the economy. “I had a pretty good run,” he told the Haitians of Miami in 2009. He’s right: he had a great run if you work for Wall Street or if you need access to what in his circles is called a “competitive” workforce. Now Clinton has been appointed by Ban Ki-Moon to organize the relief effort. The reason that there is nowhere for the traumatized residents of Port-au-Prince to go is that, as president, he promoted policies that impoverished the peasants and urban proletariat all. Their ancestors paid for his honeymoon and they are suffering as a result of his insistence that the work of Haitians should enrich Wall Street. There is nothing to eat in the countryside because successive American presidents, with Clinton at the top of the list, were unequal to the challenge of allowing Haitians to develop Haiti as they saw fit.

But life goes on. Bill Clinton can thank the Haitian peasants for his honeymoon. Barack Obama can thank them for his presidency. And, together, they can ask Aristide to return, if the Haitian people so wish, to continue the work of repairing an ugly history.

Note: The names of my Haitian friends and contacts have been changed.