- Shah Mehrabichair of the audit committee of the central bank of Afghanistan, professor of economics at Montgomery College and former adviser to the Afghan president.
- Medea Benjaminco-founder of CodePink and Unfreeze Afghanistan.
The Biden administration has ruled out releasing roughly $7 billion of frozen U.S.-held Afghan assets, a year after the Taliban takeover of Afghanistan and occupation, even as the United Nations warns a staggering 95% of Afghans are not getting enough to eat. “This money belongs to the Afghan people. And the U.S., for 365 days, has been holding their money in a New York vault while Afghan people are boiling grass to eat, are selling their kidneys, are watching their children starve,” says Unfreeze Afghanistan co-founder Medea Benjamin. We also speak with Shah Mehrabi, chair of the audit committee of the central bank of Afghanistan, who says the return of funds is necessary to bring back price stability, which would put cash back into the hands of Afghan people so they can afford basic necessities.
AMY GOODMAN: This week marks one year since the Taliban takeover of Afghanistan, after more than two decades of U.S. war and occupation. As the United Nations warns a staggering 95% of Afghans are not getting enough to eat, with that number rising to almost 100% in households headed by women, the Biden administration announced this week that it had ruled out releasing roughly $7 billion in foreign assets held by Afghanistan’s central bank on U.S. soil. That’s according to The Wall Street Journal, which reports Biden’s decision not to return the funds came after he ordered the assassination of al-Qaeda’s leader in Kabul. On Monday, State Department spokesperson Ned Price disputed reports that the Biden administration has ruled out releasing the billions of dollars in foreign assets.
NED PRICE: I don’t mean to play media critic today, but there has also been some inaccurate — highly inaccurate reporting today regarding the ultimate disposition of the $3.5 billion in reserve funds. The idea that we have decided not to use these funds for the benefit of the Afghan people is simply wrong. It is not true. Our focus right now is on ongoing efforts to enable the $3.5 billion in licensed Afghan central bank reserves to be used precisely for the benefit of the Afghan people. …
The presence of Ayman al-Zawahiri on Afghan soil with the knowledge of senior members of the Haqqani Taliban Network only reinforces the deep concerns that we have regarding the potential diversion of such funds to terrorist groups. So right now we’re looking at mechanisms that could be put in place to see to it that these $3.5 billion in preserved assets make their way efficiently and effectively to the people of Afghanistan in a way that doesn’t make them ripe for diversion to terrorist groups or elsewhere.
AMY GOODMAN: For more, we’re joined by two guests. Shah Mehrabi is the chair of the audit committee of the central bank of Afghanistan, professor of economics at Montgomery College. He’s also a former adviser to the Afghan president. His recent piece for Al Jazeera is headlined “Afghanistan’s economy is collapsing, the US can help stop it.” Also with us, longtime peace activist Medea Benjamin, co-founder of Unfreeze Afghanistan and CodePink. She last visited Afghanistan in April with an American Women’s Peace and Education Delegation.
We welcome you both to Democracy Now! Shah Mehrabi, let’s begin with you. Can you clarify what the U.S. is doing, what this $7 billion is, why the U.S. is holding onto it, if they are?
SHAH MEHRABI: Thank you very much for inviting me.
It’s important, I think, to mention the fact that President Biden, on February 11th, split the Afghanistan reserve, which was $7 billion, into two — that is, $3.5 billion to be used, as President Biden mentioned, and I quote, “for the benefits of Afghan people” and the remaining $3.5 billion to be set aside for September 11 plaintiffs to litigate. Now, the policy of splitting this, obviously, has created a situation where the central bank of Afghanistan could easily — this policy could easily decapitalize the central bank and, in turn, could easily dismantle it.
So, establishing, in a way, a mechanism that will allow central bank to use its reserve for the purpose — and the main purpose of the central bank is to bring stability and to strengthen the currency and also stabilize the economy — is very important. I think this function cannot be performed — the central bank cannot fulfill its primary objective of price stability, that is done by continuously engaging in foreign exchange auctions to prevent depreciation of local currency against foreign currencies and be able to bring price stability, because ordinary Afghans, if there’s no stable prices, they are not going to be able to buy basic household goods at reasonable prices. Reducing inflation will have to be done, because inflation now is at 52%. And auctioning will allow a situation where this inflation of double digit of 52% could be reduced to a single level, because higher prices are one of the major causes of poverty.
Now more than 70% of the world’s poorest people are women. And you have the women and children who cannot go ahead afford to buy the basic necessities. They cannot buy bread. They cannot buy cooking oil. They cannot buy sugar and fuel. I think it’s very important that Afghans be allowed to have their cash to be able to buy these basic necessities, to be able to have access to cash. And the Afghanistan reserve need to be returned to the central bank so that ordinary Afghans, as well as businesses, will be able to have access to USD, to be — businesses specifically to be able to pay for imports, and then ordinary Afghans to be able to get access to the deposits, because now the cap that is placed on ordinary Afghans and businesses, even at that cap, many of ordinary Afghans and businesses cannot get access because there is a shortage of reserve in the country.
So, I had suggested back in September that the United States should allow limited monetary release of reserve to pay for imports. And I suggested $150 million. And access could be conditioned, I said, on specific use, and that is for auctioning purposes. And this can be independently monitored and audited by an external auditing firm.
AMY GOODMAN: So, Ned Price —
SHAH MEHRABI: And if it’s — if it’s not, then it should be terminated. Yes.
AMY GOODMAN: Ned Price, the State Department spokesperson, directly addressed the issue of the money going to the Afghan central bank. This is what he said.
NED PRICE: We don’t see recapitalization of the Afghan central bank as a near-term option. We’ve engaged, and we still continue to engage, Afghan technocrats with the central bank for many months now about measures to enhance the country’s economic — macroeconomic stability. We just don’t have confidence that the institutions, safeguards and monitoring are in place to manage those assets responsibly.
AMY GOODMAN: Shah Mehrabi, he’s directly addressing your bank, the central bank of Afghanistan, says can’t handle it.
SHAH MEHRABI: This is what I said. There has to be a way, a mechanism, established to be able to test us, as a trust-building mechanism. As I said here, that what needs to be done, release this thing and monitor it, independently have auditors trying to see if the money is going to be used for the purpose for which it is designed to be used. And that is to auctioning and bring price stability. And this process could build confidence and could be considered a trust-building mechanism between the United States government and Taliban.
Now, the United States government needs to be actively engaged, and I think dialogue should continue, as it is, I’ve argued, in the best interest of the United States. Now, and I think this temporary pause that exists now, I think, is understandable. But the United States’ strategic interest in the long run dictates that there has to be a dialogue and engagement; otherwise, I think I would argue the United States will pay higher price if Afghanistan collapses, because a failed state could create more space for terror organizations.
AMY GOODMAN: Medea Benjamin, The Wall Street Journal reports that the Biden administration has ruled out releasing the billions of dollars in foreign assets because of their learning of and then killing the al-Qaeda leader in Kabul, Ayman al-Zawahiri. Your response?
MEDEA BENJAMIN: Thirty-eight million Afghan people should not be punished because a 71-year-old figurehead of al-Qaeda was living in Kabul. This money belongs to the Afghan people. And the U.S., for 365 days, has been holding their money in a New York vault while Afghan people are boiling grass to eat, are selling their kidneys, are watching their children starve. This is unconscionable. That money has to be returned. The U.S., for 20 years, built up a central bank in Afghanistan with a monitoring mechanism. It’s one of the only things that continues to exist after 20 years of U.S. occupation. And now it wants to hollow out that central bank, create a separate mechanism.
I think the Biden administration, instead of listening to the war hawks in his own party and the Republicans, should listen to the women’s organizations in Afghanistan, the 9/11 family members, the economists from around the world, including Joseph Stiglitz, the human rights organizations, who have all said that this humanitarian crisis can only be solved by reinvigorating the economy and returning the Afghans’ money to their central bank.
AMY GOODMAN: We’re here talking about — I don’t know if it’s seven — whether it’s $7 billion or $9 billion, but half of that, because the other half, the Biden administration has determined, would go to the 9/11 victims. If you could respond to that, Medea? And also this issue — I mean, you’re a longtime women’s rights activist, a feminist — of the enormous crackdown on women and girls in Afghanistan, how that money would not go to supporting the Taliban, who are doing this?
MEDEA BENJAMIN: The lawsuits by a small number of 9/11 family members really will enrich the lawyers more than anyone else. And I think we should listen to the September 11th Families for Peaceful Tomorrows, who have spearheaded a letter that 76 family members have signed, calling — saying that not a penny of that money should go for the 9/11 families, it should all go for the Afghan people.
As a feminist, I am certainly opposed to the policies of the Taliban, which have been horrific in not letting girls go to secondary schools and forcing women to cover themselves when they’re out in public and saying they can’t travel around the country without a guardian. All of these things must be opposed. And we are in touch with Afghan women every day that are working to change those policies. But they are already victimized by the Taliban; they should not be victimized by the United States by stealing the funds that they need to get their economy going. There are about 50,000 women businesses that are still trying to function in Afghanistan. They need access to the bank to pay for the salaries of their staff. Pensioners, women, need access to the bank to get their pensions. So, as a feminist, and I think all feminists should say, let’s help reinvigorate the Afghan economy so that people can get jobs and that they can feed their children.
AMY GOODMAN: Shah Mehrabi, your final comments? And would you support a third party getting that money?
SHAH MEHRABI: I think a mechanism that is under negotiation that will enable the transfer of fund to be used for, from my point of view, for price stability and also for reducing the volatility in exchange rate, I think, is a positive move. Now, there has been, as I said, in one way or another, a pause, and the pause hopefully is temporary. And I think negotiation and dialogue that will enable the central bank of Afghanistan to have access to its reserve must continue, as it is not only in the best interest of the United States, but it’s in the best interest of ordinary Afghans.
I want to also mention that there’s no — that no increase in the humanitarian aid can compensate for the macroeconomic harm of higher prices for basic commodities. That is, you know, aiming for a banking collapse or balance of payment crisis. And I think severe consequences could ripple throughout Afghan society and harm the most vulnerable people. And I think we have the tools and mechanism to be able to reverse it. And I think the freezing of Afghan assets will not — very important: It will not weaken the interim Taliban administration, while the overwhelming impact of that will be on — it will fall on innocent Afghans, who have suffered decades of — decades of war and poverty.
And I think, while we have the means to be able to reverse this, why not go ahead and reverse this worst economic and humanitarian crisis? And I think the best way is by having — releasing the Afghanistan reserve, that rightfully belong to Afghan people, who established an independent central bank, and allow the central bank to be able to manage, to maintain this reserve and to be able to safeguard the international value of afghani, which is the national currency, and restore and keep and maintain price stability and also be able to allow and foster liquidity and also bring confidence in Afghanistan money and exchange rate policies.
AMY GOODMAN: Shah Mehrabi, we want to thank you for being with us, chair of the audit committee of the Afghanistan central bank, longtime economist, economics professor at Montgomery College. And, Medea Benjamin, co-founder of CodePink, Unfreeze Afghanistan, please stay with us. When we come back, I want to ask you about the Biden administration’s sanctions on Cuba, making it difficult for Cuba to effectively respond to a recent tragic fire, also the military budget that has been proposed, and the sentencing of a Saudi feminist to decades in prison in Saudi Arabia. Stay with us.