WHAT ‘DEMOCRACY’ REALLY MEANS IN U.S. AND NEW YORK TIMES JARGON: LATIN AMERICA EDITION October 19, 2014Posted by rogerhollander in Bolivia, Democracy, Foreign Policy, Imperialism, Latin America, Media, Venezuela.
Tags: Bolivia, democracy, dictatorships, egypt coup, Evo Morales, foreign policy, glenn greenwald, Hugo Chavez, imperialism, journalism, Media, new york times, roger hollander, Venezuela, venezuela coup
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Roger’s note: I read the New York Times (it is the most right wing site I go to online; and, when asked how I keep up with the “other side,” I reply that one absorbs it by osmosis), there is often good reporting and feature articles; but on U.S. foreign policy, the Times is as Neanderthal as Bush/Obama/Clintons.
One of the most accidentally revealing media accounts highlighting the real meaning of “democracy” in U.S. discourse is a still-remarkable 2002 New York Times Editorial on the U.S.-backed military coup in Venezuela, which temporarily removed that country’s democratically elected (and very popular) president, Hugo Chávez. Rather than describe that coup as what it was by definition – a direct attack on democracy by a foreign power and domestic military which disliked the popularly elected president – the Times, in the most Orwellian fashion imaginable, literally celebrated the coup as a victory for democracy:
With yesterday’s resignation of President Hugo Chávez, Venezuelan democracy is no longer threatened by a would-be dictator. Mr. Chávez, a ruinous demagogue, stepped down after the military intervened and handed power to a respected business leader, Pedro Carmona.
Thankfully, said the NYT, democracy in Venezuela was no longer in danger . . . because the democratically-elected leader was forcibly removed by the military and replaced by an unelected, pro-U.S. “business leader.” The Champions of Democracy at the NYT then demanded a ruler more to their liking: “Venezuela urgently needs a leader with a strong democratic mandate to clean up the mess, encourage entrepreneurial freedom and slim down and professionalize the bureaucracy.”
More amazingly still, the Times editors told their readers that Chávez’s “removal was a purely Venezuelan affair,” even though it was quickly and predictably revealed that neocon officials in the Bush administration played a central role. Eleven years later, upon Chávez’s death, the Times editors admitted that “the Bush administration badly damaged Washington’s reputation throughout Latin America when it unwisely blessed a failed 2002 military coup attempt against Mr. Chávez” [the paper forgot to mention that it, too, blessed (and misled its readers about) that coup]. The editors then also acknowledged the rather significant facts that Chávez’s “redistributionist policies brought better living conditions to millions of poor Venezuelans” and “there is no denying his popularity among Venezuela’s impoverished majority.”
If you think The New York Times editorial page has learned any lessons from that debacle, you’d be mistaken. Today they published an editorialexpressing grave concern about the state of democracy in Latin America generally and Bolivia specifically. The proximate cause of this concern? The overwhelming election victory of Bolivian President Evo Morales (pictured above), who, as The Guardian put it, “is widely popular at home for a pragmatic economic stewardship that spread Bolivia’s natural gas and mineral wealth among the masses.”
The Times editors nonetheless see Morales’ election to a third term not as a vindication of democracy but as a threat to it, linking his election victory to the way in which “the strength of democratic values in the region has been undermined in past years by coups and electoral irregularities.” Even as they admit that “it is easy to see why many Bolivians would want to see Mr. Morales, the country’s first president with indigenous roots, remain at the helm” – because “during his tenure, the economy of the country, one of the least developed in the hemisphere, grew at a healthy rate, the level of inequality shrank and the number of people living in poverty dropped significantly” – they nonetheless chide Bolivia’s neighbors for endorsing his ongoing rule: “it is troubling that the stronger democracies in Latin America seem happy to condone it.”
The Editors depict their concern as grounded in the lengthy tenure of Morales as well as the democratically elected leaders of Ecuador and Venezuela: “perhaps the most disquieting trend is that protégés of Mr. Chávez seem inclined to emulate his reluctance to cede power.” But the real reason the NYT so vehemently dislikes these elected leaders and ironically views them as threats to “democracy” becomes crystal clear toward the end of the editorial (emphasis added):
This regional dynamic has been dismal for Washington’s influence in the region. In Venezuela, Bolivia and Ecuador, the new generation of caudillos [sic] have staked out anti-American policies and limited the scope of engagement on development, military cooperation and drug enforcement efforts. This has damaged the prospects for trade and security cooperation.
You can’t get much more blatant than that. The democratically elected leaders of these sovereign countries fail to submit to U.S. dictates, impede American imperialism, and subvert U.S. industry’s neoliberal designs on the region’s resources. Therefore, despite how popular they are with their own citizens and how much they’ve improved the lives of millions of their nations’ long-oppressed and impoverished minorities, they are depicted as grave threats to “democracy.”
It is, of course, true that democratically elected leaders are capable of authoritarian measures. It is, for instance, democratically elected U.S. leaders who imprison people without charges for years, build secret domestic spying systems, and even assert the power to assassinate their own citizens without due process. Elections are no guarantee against tyranny. There are legitimate criticisms to be made of each of these leaders with regard to domestic measures and civic freedoms, as there is for virtually every government on the planet.
But the very idea that the U.S. government and its media allies are motivated by those flaws is nothing short of laughable. Many of the U.S. government’s closest allies are the world’s worst regimes, beginning with the uniquely oppressive Saudi kingdom (which just yesterday sentenced a popular Shiite dissident to death) and the brutal military coup regime in Egypt, which, as my colleague Murtaza Hussain reports today, gets more popular in Washington as it becomes even more oppressive. And, of course, the U.S. supports Israel in every way imaginable even as its Secretary of State expressly recognizes the “apartheid” nature of its policy path.
Just as the NYT did with the Venezuelan coup regime of 2002, the U.S. government hails the Egyptian coup regime as saviors of democracy. That’s because “democracy” in U.S. discourse means: “serving U.S. interests” and “obeying U.S. dictates,” regardless how how the leaders gain and maintain power. Conversely, “tyranny” means “opposing the U.S. agenda” and “refusing U.S. commands,” no matter how fair and free the elections are that empower the government. The most tyrannical regimes are celebrated as long as they remain subservient, while the most popular and democratic governments are condemned as despots to the extent that they exercise independence.
To see how true that is, just imagine the orgies of denunciation that would rain down if a U.S. adversary (say, Iran, or Venezuela) rather than a key U.S. ally like Saudi Arabia had just sentenced a popular dissident to death. Instead, the NYT just weeks ago uncritically quotes an Emirates ambassador lauding Saudi Arabia as one of the region’s “moderate” allies because of its service to the U.S. bombing campaign in Syria. Meanwhile, the very popular, democratically elected leader of Bolivia is a grave menace to democratic values – because he’s “dismal for Washington’s influence in the region.”
Photo: Dean Mouhtaropoulos/Getty Images
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The Egyptian Counterrevolution Will Not Be Televised June 27, 2014Posted by rogerhollander in Civil Liberties, Egypt, Mining.
Tags: al-jazeera, amy goodman, denis moynihan, egypt coup, egypt repression, el-sisi, Media, military aid, muslim brotherhood, press freedom, roger hollander, sisi
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Roger’s note: the Egyptian “elected” dictator, General Abdel Fattah el-Sisi, attended training sessions in the UK and the USA. He is no doubt an “asset” of these two powerful paragons of Western democracy. It only matters that he is pro-American, no matter how oppressive and tyrannical with respect to the Egyptian media and opposition. If Obama says the Egyptian coup was not a coup, who is there to contradict him, as long as the US millions in military aid keep flowing.
Published on Thursday, June 26, 2014 by Truthdig
Egypt sentenced three Al-Jazeera journalists this week to severe prison terms, in court proceedings that observers described as “farcical.” Peter Greste, Mohamed Fahmy and Baher Mohamed were charged with fabricating news footage, and thus supporting the Muslim Brotherhood, which was ousted from power in a military coup a year ago and labeled a terrorist organization. Along with the three jailed journalists, three other foreign journalists were tried and convicted in absentia. Greste, who is Australian, and Fahmy, who is Canadian-Egyptian, received seven-year prison sentences. Baher Mohamed, who is Egyptian, was dealt a 10-year sentence, ostensibly because he had an empty shell casing in his possession, which is an item that many journalists covering conflicts pick up off the street as evidence. The prosecutors called that possession of ammunition. The harsh, six-month pretrial imprisonment, the absurd trial itself and now these sentences have generated global outrage. A movement is growing to demand clemency or release for these three journalists. But while the words of the Obama administration support their freedom, the U.S. government’s actions, primarily in pledging to resume military aid to Egypt, send the opposite message.
The three journalists who were sentenced in absentia to 10 years in prison are Al-Jazeera correspondent Sue Turton, along with Dominic Kane and Dutch journalist Rena Netjes. Speaking on the “Democracy Now!” news hour from Doha, Qatar, where Al-Jazeera is based, Turton told me: “The verdicts left us all here at Al-Jazeera quite stunned. We dared to believe that the verdict would be ‘not guilty,’ because we had sat and watched the court sessions over the past few months, and we’d seen absolutely no evidence that the prosecution had brought that proved in any way, shape or form the charges against us.”
Jailed journalist Greste has won awards for his work around the world for Reuters and the BBC prior to Al-Jazeera. Fahmy was working as Al-Jazeera’s Cairo bureau chief at the time of the trio’s Dec. 29, 2013, arrest. He has also worked for CNN, contributed to The New York Times and worked with “PBS NewsHour.” Margaret Warner, the chief foreign-affairs correspondent for “NewsHour,” worked with Fahmy while covering the Egyptian revolution in 2011 when her crew was attacked. She said of Fahmy’s efforts that day: “He absolutely saved our lives. I’m no legal expert, but I can tell you that Mohamed Fahmy struck me … as nothing more and nothing less than a professional journalist.”
In a letter sent to the newly elected President Abdel Fattah el-Sisi, more than 75 journalists, including “Democracy Now!” correspondent Sharif Abdel Kouddous, who is himself Egyptian-American, wrote: “As journalists, we support the release of all of our Egyptian or international colleagues who may be imprisoned for doing what they believed to be their jobs.”
The Committee to Protect Journalists noted, “While the focus has been on the Al-Jazeera journalists, in fact Egypt is currently holding at least 14 journalists in prison, placing the country among the world’s worst repressors.” Amnesty International is calling on people around the world to appeal to President Sisi, writing: “All three men are prisoners of conscience, imprisoned solely for the peaceful exercise of their right to free expression. Egypt must immediately drop the charges against the three journalists and let them go free.”
Of course, not all voices calling for freedom are equal. When the sentences were handed down in court this week, Mohamed Fahmy shouted from his cage, “Where is John Kerry?” It was a very important question. The day before the verdict was issued, U.S. Secretary of State John Kerry was in Cairo, meeting with Sisi.
Egypt has long been one of the largest recipients of U.S. aid, averaging $1.5 billion-$2 billion per year since 1979. Since the coup d’etat last year, that aid has been halted, but the U.S. says it is resuming military aid. One of Kerry’s former colleagues in the Senate, Patrick Leahy, warned, “The harsh actions taken today against journalists is the latest descent toward despotism.” So how is it that the U.S. is restoring more than $500 million in military aid right now?
From his home in Australia, Peter Greste’s father, Juris Greste, said, “Journalism is not a crime,” echoing the sentiment that has gone global. In newsrooms the world over, from the BBC and the Toronto Star to Hong Kong, journalists and staff are posting photos of their mouths covered with tape, protesting Egypt’s oppression of the press. President Barack Obama and Secretary of State Kerry should take heed. A threat to the freedom of the press is a threat to the public’s right to know. It is the flow of information, not the flow of military aid, that is essential to the functioning of a democratic society.
Denis Moynihan contributed research to this column.
Tags: cia, guardian, julie hollar, Media, new york times, pakistan, polio, polio emergency, polio epidemic, polio vaccine, roger hollander, Taliban
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Roger’s note: just another example of how the US taxpayers’ dollars are used to spread misery around the globe.
Polio had been battled to near-extinction after decades of effort, but this year the WHO confirmed 68 new cases and declared it an international public health emergency. Nearly 80 percent of those cases are in Pakistan.
Why is this? According to the New York Times‘ Donald McNeil Jr. (5/6/14), “Polio has never been eliminated there, Taliban factions have forbidden vaccinations in North Waziristan for years, and those elsewhere have murdered vaccine teams.” McNeil also quotes a WHO spokesperson towards the top of the piece: “So we’re saying to the Pakistanis, the Syrians and the Cameroonians, ‘You’ve really got to get your acts together.”‘
The Times underlined the emergency today in an editorial, explaining that Pakistan has such high numbers “largely because Taliban factions have forbidden vaccinations in conservative tribal areas and attacked healthcare workers elsewhere.”
There’s a crucial piece of information missing here—one that these outlets know full well. In 2011, the British Guardian (7/11/11) reported that the CIA used a fake vaccination drive led by Pakistani Dr. Shakil Afridi to gain entry to bin Laden’s compound and gather DNA to confirm his presence there. As McNeil himself reported in 2012 (7/9/12), that revelation led to suspicion and banning of vaccination teams in the tribal areas of Pakistan. At the time, the WHO argued that, while it was a “setback…unless it spreads or is a very longtime affair, the program is not going to be seriously affected.”
Then the killings started; the Times reported several times on killings of polio vaccination workers in Pakistan, noting in June 2013 that these attacks “escalated” after the revelation of the CIA plot. And the following month, McNeil reported that after Dr. Afridi was sentenced to 33 years in prison for treason, “Anger deepened when American lawmakers called Dr. Afridi a hero and threatened to cut off aid if he was not released.”
Fast forward to this week, and CBS Evening News (5/5/14) likewise avoided the CIA connection in reporting the most recent story, as anchor Scott Pelley noted: “Most cases are in Pakistan, where vaccine workers have been murdered on suspicion that they’re spying for the United States.”
The PBS NewsHour (5/6/14) was one of the only outlets that mentioned the CIA issue, in a report by correspondent Jeffrey Brown:
BROWN: Dr. Anita Zaidi, a pediatrician, cited a fake vaccination campaign that the CIA used in the hunt for Osama bin Laden.
ZAIDI: Which has hugely damaged public health programs, not only in Pakistan, but in many, many countries, because people ask all kinds of questions. They now think that they might—the vaccine programs might be actually spy operations.
This story was well-reported in the past, particularly by the Times; why the silence now that the problem has been declared an international emergency?
Pulitzer Vindicates: Snowden Journalists Win Top Honor April 15, 2014Posted by rogerhollander in Civil Liberties, Media, Whistle-blowing.
Tags: barton gellman, edward snowden, ewen macaskill, glenn greenwald, guardian, journalism, laura poitras, lauren mccauley, Media, nsa, nsa leaks, prism, public service, pulitzer, roger hollander, washington post, whistle-blowing
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Roger’s note: I don’t know why, but somehow I don’t expect that this vindication of Edward Snowden’s bravery will not get much play in the mainstream media, so I am posting it here. As some of the comments on the Common Dreams web site have pointed out, there has been no or little mention of those who made great sacrifices and paid a price for speaking out, such as Chelsea Manning (it is reported today that the General in charge of her kangaroo court martial has affirmed her 35 year sentence) and Julian Assange (held prisoner indefinitely in London’s Ecuadorian Embassy). These should not be forgotten.
Guardian and Washington Post each honored with Pulitzer for Public Service
The Washington Post and the Guardian/US were both awarded one of journalism’s top honors on Monday—the Pulitzer Prize for Public Service— for their separate but related reporting on the NSA’s widespread surveillance documents leaked by NSA whistleblower Edward Snowden.
Journalists Glenn Greenwald, Laura Poitras and Ewen MacAskill from the Guardian and the Washington Post’s Barton Gellman sent shock waves across the globe for their reporting on the leaks—eliciting responses from citizens and governments alike and spurring a new era of backlash against government intrusion.
Following news of the honor, Snowden released a statement thanking the Pulitzer committee for recognizing those involved in the NSA reporting. He wrote:
Today’s decision is a vindication for everyone who believes that the public has a role in government. We owe it to the efforts of the brave reporters and their colleagues who kept working in the face of extraordinary intimidation, including the forced destruction of journalistic materials, the inappropriate use of terrorism laws, and so many other means of pressure to get them to stop what the world now recognizes was work of vital public importance.
This decision reminds us that what no individual conscience can change, a free press can. My efforts would have been meaningless without the dedication, passion, and skill of these newspapers, and they have my gratitude and respect for their extraordinary service to our society. Their work has given us a better future and a more accountable democracy.
The Pulitzer committee awarded the prize to the publications for their “revelation[s] of widespread secret surveillance by the National Security Agency,” specifying that the Guardian, “through aggressive reporting,” helped “to spark a debate about the relationship between the government and the public over issues of security and privacy.” They credited the Post for their “authoritative and insightful reports that helped the public understand how the disclosures fit into the larger framework of national security.”
The Guardian team broke the first report on the NSA’s collection of Verizon phone records and Gellman, with help from Poitras, reported on the wide-ranging surveillance program known as “PRISM.” In addition to Greenwald, Poitras, MacAskill and Gellman—who are primarily credited for the NSA revelations—a number of other reporters working at the publications also contributed to the reporting that followed.
Following the announcement, many hailed the selection as a vindication of the actions of both the journalists and the whistleblower, a number of whom have been threatened for their work and are forced to remain in exile for fear of persecution by the U.S. government.
“The stories that came out of this completely changed the agenda on the discussion on privacy and the NSA,” David Remnick, editor of The New Yorker, said prior to the announcement. “There’s an enormous public good in that, and it’s yet to be proven at all that somehow did great damage to national security.”
“I can’t imagine a more appropriate choice for a Pulitzer Prize,” New York University media studies professor Mark Miller told AFP. Miller said that the winning team of reporters did what “American journalists are supposed to do, which is serve the public interest by shedding a bright light on egregious abuse of power by the government.”
“The real journalistic heroes in this country tend to be the mavericks, the eccentrics, those who dare to report stories that are often dismissed derisively as ‘conspiracy theory,'” Miller continued.
On Friday, Poitras and Greenwald returned to the U.S. for the first time since breaking the NSA stories to accept the prestigious George Polk Award for national security reporting.
During his acceptance speech for the George Polk award, Greenwald discussed the intimidation that both whistleblowers and journalists face.
“The only way to deal with threats,” he said, “is to just do the reporting as aggressively, if not more so, than you would absent those threats.”
The Extraordinary Pierre Omidyar November 18, 2013Posted by rogerhollander in Media, Poverty, Right Wing.
Tags: brac, bridge international, columbia journalsim review, donors choose, free market, Fujimori, glenn greenwald, grameen bank, hernando de soto, india suicides, journalism, koch brothers, mark ames, Media, micro credit, micro lending, microcredit, microfinance, milton friedman, neoliberal, omidyar network, pierre omidyar, poverty, predatory micro-loans, privatization, roger hollander, sks microfinance, tea party, third world, unitus, yasha levin
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Roger’s note: This is an incredible piece of investigative journalism. When I first read that Glenn Greenwald (I sincerely hope he has or will read this article) was leaving The Guardian to enter into a new journalist project financed by eBay founder, the billionaire Pierre Omidyar, my initial response was, “Glenn, say it isn’t so.” This was based on instinct. It just didn’t smell right. The article you are about to read pinpoints the source of the odor. Greenwald’s work as an investigative journalist, first with his own Blog, then with salon.com, and finally with the Guardian, even prior to the Snowden revelations, was of vital importance with respect to its exposing the crimes of the Bush and Obama administrations. In a sense, the I.F. Stone of our day. Even if Omidyar wasn’t the sleeze bucket neo-Liberal that is pictured by Ames and Levin, you don’t magically overnight create independent journalism via anyone’s big bucks. Salon and The Guardian have roots and a history of journalistic development for which there is no substitute. Apart from exposing Omidyar, this article is a clinic on the way the ultra and neo-fascist right is working to destroy what is left of the democratic public sector; and we know from Germany and Italy in the 1930s what to expect when private corporations are in total control of the state.
http://www.nsfwcorp.com, 11:51 a.m. November 15, 2013
“We ought to be looking at business as a force for good.” – Pierre Omidyar
“Like eBay, Omidyar Network harnesses the power of markets to enable people to tap their true potential.” – Omidyar Network, “Frequently Asked Questions”
* * The world knows very little about the political motivations of Pierre Omidyar, the eBay billionaire who is founding (and funding) a quarter-billion-dollar journalism venture with Glenn Greenwald, Laura Poitras and Jeremy Scahill. What we do know is this: Pierre Omidyar is a very special kind of technology billionaire.
We know this because America’s sharpest journalism critics have told us.
In a piece headlined “The Extraordinary Promise of the New Greenwald-Omidyar Venture”, The Columbia Journalism Review gushed over the announcement of Omidyar’s project. And just in case their point wasn’t clear, they added the amazing subhead, “Adversarial muckrakers + civic-minded billionaire = a whole new world.”
Ah yes, the fabled “civic-minded billionaire”—you’ll find him two doors down from the tooth fairy.
But seriously folks, CJR really, really wants you to know that Omidyar is a breed apart: nothing like the Randian Silicon Valley libertarian we’ve become used to seeing.
“…billionaires don’t tend to like the kind of authority-questioning journalism that upsets the status quo. Billionaires tend to have a finger in every pie: powerful friends they don’t want annoyed and business interests they don’t want looked at.
“By hiring Greenwald & Co., Omidyar is making a clear statement that he’s the billionaire exception….It’s like Izzy Stone running into a civic-minded plastics billionaire determined to take I.F. Stone’s Weekly large back in the day.”
Later, the CJR “UPDATED” the piece with this missing bit of “oops”:
“(UPDATE: I should disclose that the Omidyar Network helps fund CJR, something I didn’t know until shortly after I published this post.)”
No biggie. Honest mistake. And anyway, plenty of others rushed to agree with CJR’s assessment. Media critic Jack Shafer at Reuters described Omidyar’s politics and ideology as “close to being a clean slate,” repeatedly praising the journalism venture’s and Omidyar’s “idealism.” The “NewCo” venture with Greenwald “harkens back to the techno-idealism of the 1980s and 1990s, when the first impulse of computer scientists, programmers, and other techies was to change the world, not make more money,” Shafer wrote, ending his piece:
“As welcome as Omidyar’s money is, his commitment to the investigative form and an open society is what I’m grateful for this afternoon. You can never uphold the correct verdict too often.”
What all of these orgasmic accounts of Omidyar’s “idealism” have in common is a total absence of skepticism. America’s smartest media minds simply assume that Omidyar is an “exceptional” billionaire, a “civic-minded billionaire” driven by “idealism” rather than by profits. The evidence for this view is Pierre Omidyar’s massive nonprofit venture, Omidyar Network, which has distributed hundreds of millions of dollars to causes all across the world.
And yet what no one seems able to specify is exactly what ideology Omidyar Network promotes. What does Omidyar’s “idealism” mean in practice, and is it really so different from the non-idealism of other, presumably bad, billionaires? It’s almost as if journalists can’t answer those questions because they haven’t bothered asking them.
So let’s go ahead and do that now.
Since its founding in 2004, Omidyar Network has committed nearly $300 million to a range of nonprofit and for-profit “charity” outfits. An examination of the ideas behind the Omidyar Network and of the investments it has made suggests that its founder is anything but a “different” sort of billionaire. Instead, what emerges is almost a caricature of neoliberal ideology, complete with the trail of destruction that ensues when that ideology is put into practice. The generous support of the Omidyar Network goes toward “fighting poverty” through micro-lending, reducing third-world illiteracy rates by privatizing education and protecting human rights by expanding property titles (“private property rights”) into slums and villages across the developing world.
In short, Omidyar Network’s philanthropy reveals Omidyar as a free-market zealot with an almost mystical faith in the power of “markets” to transform the world, end poverty, and improve lives—one micro-individual at a time.
All the neoliberal guru cant about solving the world’s poverty problems by unlocking the hidden “micro-entrepreneurial” spirit of every starving Third Worlder is put into practice by Omidyar Network’s investments. Charity without profit motive is considered suspect at best, subject to the laws of unintended consequences; good can only come from markets unleashed, and that translates into an ideology inherently hostile to government, democracy, public politics, redistribution of land and wealth, and anything smacking of social welfare or social justice.
In literature published by Omidyar Network, the assumption is that technology is an end in itself, that it naturally creates beneficial progress, and that the world’s problems can be solved most effectively with for-profit business solutions.
The most charitable thing one can say about Omidyar’s nonprofit network is that it reflects all the worst clichés of contemporary neoliberal faith. In reality, it’s much worse than that. In many regions, Omidyar Network investments have helped fund programs that create worsening conditions for the world’s underclass, widening inequalities, enhancing exploitation, pushing millions of people into crippling debt and supporting anti-poverty programs that, in some cases, resulted in mass-suicide by the rural poor.
* * Pierre Omidyar was one of the biggest early backers of the for-profit micro-lending industry. Through Omidyar Network, as well as personal gifts and investments, he has funnelled around $200 million into various micro-lending companies and projects over the past decade, with the goal of establishing an investment-grade microfinance sector that would be plugged into Wall Street and global finance. The neoliberal theory promised to unleash billions of new micro-entrepreneurs; the stark reality is that it saddled untold numbers with crushing debt and despair.
One of his first major investments into micro-lending came in 2005, when Pierre Omidyar and his wife Pam gave Tufts University, their alma mater, $100 million to create the “Omidyar-Tufts Microfinance Fund,” a managed for-profit fund dedicated to jump-starting the growth of the micro-finance industry. At the time, Tufts announced that Omidyar’s gift was the “largest private allocation of capital to microfinance by an individual or family.”
With the Tufts fund, Omidyar wanted to go beyond mere charitable donations to specific micro-lending organizations that targeted the developing world’s poorest. At the same time, he wanted to create a whole new environment in which for-profit micro-lending companies could be self-sustaining and generate big enough profits to attract serious global investors.
This idea was at the core of Omidyar’s vision of philanthropy: he believed that microfinance would eradicate poverty faster and better if it was run on a for-profit basis, and not like a charity.
“If you want to reach global scale — and we’re talking about hundreds of millions of people who need this — you can’t do it with philanthropy capital. There’s not enough charity capital out there. By connecting with an institutional investor like a university, we would like to increase the level of professional investor involvement in this sector to try to stimulate more commercially viable investment products,” Pierre Omidyar said in an interview at the time. “We ought to be looking at business as a force for good.”
The idea behind micro-loans is very simple and seductive. It goes something like this: the only thing that prevents the hundreds of millions of people living in extreme poverty from achieving financial success is their lack of access to credit. Give them access to micro-loans—referred to in Silicon Valley as “seed capital”—and these would-be successful business-peasants and illiterate shantytown entrepreneurs would pluck themselves out of the muck by their own homemade sandal straps. Just think of it: hundreds of millions of peasants working as micro-individuals, taking out micro-loans, making micro-rational investments into their micro-businesses, dutifully paying their micro-loan payments on time and working in concert to harness the deregulated power of the markets to collectively lift society out of poverty. It’s a grand neoliberal vision.
To that end, Omidyar has directed about a third of the Omidyar Network investment fund—or about $100 million—to support the micro-lending industry. The foundation calls this initiative “financial inclusion.”
Shockingly, micro-loans aren’t all that they’ve cracked up to be. After years of observation and multiple studies, it turns out that the people benefiting most from micro-loans are the big global financial players: hedge funds, banks and the usual Wall Street hucksters. Meanwhile, the majority of the world’s micro-debtors are either no better off or have been sucked into a morass of crippling debt and even deeper poverty, which offers no escape but death.
Take SKS Microfinance, an Omidyar-backed Indian micro-lender whose predatory lending practices and aggressive collection tactics have caused a rash of suicides across India.
Omidyar funded SKS through Unitus, a microfinance private equity fund bankrolled by the Omidyar Network to the tune of at least $11.7 million. ON boosted SKS in its promotional materials as a micro-lender that’s “serving the rural poor in India” and that exemplifies a company that’s providing “people with the means to address their needs and improve their lives.”
In 2010, SKS made headlines and stirred up bitter controversy about the role that profits should play in anti-poverty initiatives when the company went public with an IPO that generated about $358 million, giving SKS a market valuation of more than $1.6 billion. The IPO made millions for its wealthy investors, including the Omidyar-backed Unitus fund, which earned a cool $5 million profit from the SKS IPO, according to the Puget Sound Business Journal.
Some were bothered, but others saw it as proof that the power of the markets could be harnessed to succeed where traditional charity programs supposedly hadn’t. The New York Times reported:
“An Indian company with rich American backers is about to raise up to $350 million in a stock offering closely watched by philanthropists around the world, showing that big profits can be made from small helping-hand loans to poor cowherds and basket weavers.”
Controversy or not, SKS embodied Omidyar’s vision of philanthropy: it was a for-profit corporation that fought poverty while generating lucrative returns for its investors. Here would be proof-positive that the profit motive makes everyone a winner.
And then reality set in.
In 2012, it emerged that while the SKS IPO was making millions for its wealthy investors, hundreds of heavily indebted residents of India’s Andhra Pradesh state were driven to despair and suicide by the company’s cruel and aggressive debt-collection practices. The rash of suicides soared right at the peak of a large micro-lending bubble in Andhra Pradesh, in which many of the poor were taking out multiple micro-loans to cover previous loans that they could no longer pay. It was subprime lending fraud taken to the poorest regions of the world, stripping them of what little they had to live on. It got to the point where the Chief Minister of Andrah Pradesh publicly appealed to the state’s youth and young women not to commit suicide, telling them, “Your lives are valuable.”
The AP conducted a stunning in-depth investigation of the SKS suicides, and their reporting needs to be quoted at length to understand just how evil this program is. The article begins:
“First they were stripped of their utensils, furniture, mobile phones, televisions, ration cards and heirloom gold jewelry. Then, some of them drank pesticide. One woman threw herself in a pond. Another jumped into a well with her children.
“Sometimes, the debt collectors watched nearby.”
What prompted the AP investigation was the gulf between the reported rash of suicides linked to SKS debt collectors, and SKS’s public statements denying it had knowledge of or any role in the predatory lending abuses. However, the AP got a hold of internal SKS documents that contradicted their public denials:
“More than 200 poor, debt-ridden residents of Andhra Pradesh killed themselves in late 2010, according to media reports compiled by the government of the south Indian state. The state blamed microfinance companies – which give small loans intended to lift up the very poor – for fueling a frenzy of overindebtedness and then pressuring borrowers so relentlessly that some took their own lives.
“The companies, including market leader SKS Microfinance, denied it.
“However, internal documents obtained by The Associated Press, as well as interviews with more than a dozen current and former employees, independent researchers and videotaped testimony from the families of the dead, show top SKS officials had information implicating company employees in some of the suicides.”
The AP investigation and internal reports showed just how brutal the SKS microfinancing program was, how women were particularly targeted because of their heightened sense of shame and community responsibility—here is the brutal reality of financial capitalism compared to the utopian blather mouthed at Davos conferences, or in the slick pamphlets issued by the Omidyar Network:
“Both reports said SKS employees had verbally harassed over-indebted borrowers, forced them to pawn valuable items, incited other borrowers to humiliate them and orchestrated sit-ins outside their homes to publicly shame them. In some cases, the SKS staff physically harassed defaulters, according to the report commissioned by the company. Only in death would the debts be forgiven.
“The videos and reports tell stark stories:
“One woman drank pesticide and died a day after an SKS loan agent told her to prostitute her daughters to pay off her debt. She had been given 150,000 rupees ($3,000) in loans but only made 600 rupees ($12) a week.
“Another SKS debt collector told a delinquent borrower to drown herself in a pond if she wanted her loan waived. The next day, she did. She left behind four children.
“One agent blocked a woman from bringing her young son, weak with diarrhea, to the hospital, demanding payment first. Other borrowers, who could not get any new loans until she paid, told her that if she wanted to die, they would bring her pesticide. An SKS staff member was there when she drank the poison. She survived.
“An 18-year-old girl, pressured until she handed over 150 rupees ($3)—meant for a school examination fee—also drank pesticide. She left a suicide note: ‘Work hard and earn money. Do not take loans.'”
As a result of the bad press this scandal caused, the Omidyar Network deleted its Unitus investment from its website—nor does Omidyar boast of its investments in SKS Microfinance any longer. Meanwhile, Unitus mysteriously dissolved itself and laid off all of its employees right around the time of the IPO, under a cloud of suspicion that Unitus insiders made huge personal profits from the venture, profits that in theory were supposed to be reinvested into expanding micro-lending for the poor.
Thus spoke the profit motive.
Curiously, in the aftermath of the SKS micro-lending scandal, Omidyar Network was dragged into another political scandal in India when it was revealed that Omidyar and the Ford Foundation were placing their own paid researchers onto the staffs of India’s MPs. The program, called Legislative Assistants to MPs (LAMPs), was funded with $1 million from Omidyar Network and $855,000 from the Ford Foundation. It was shut down last year after India’s Ministry of Home Affairs complained about foreign lobbying influencing Indian MPs, and promised to investigate how Omidyar-funded research for India’s parliament may have been “colored” by an agenda.
But SKS is not the only microfinancing investment gone bad. The biggest and most reputable micro-lenders, including those funded by the Omidyar Network, have come under serious and sustained criticism for predatory interest rates and their aggressive debt-collection techniques.
Take BRAC, another big beneficiary of Omidyar’s efforts to boost “financial inclusion.”
Started in the early 1970s as a war relief organization, BRAC has grown into the largest non-governmental organization in the world. It employs over 100,000 people in countries across the globe. While BRAC is known mostly for its micro-lending operation activities, the outfit is a diversified nonprofit business operation. It is involved in education, healthcare and even develops its own hybrid seed varieties. Much of BRAC’s operations are financed by its micro-lending activities.
Omidyar Network praises BRAC for its work to “empower the poor to improve their own lives,” and has given at least $8 million to help BRAC set up micro-lending banking infrastructure in Liberia and Sierra Leone.
But BRAC seems to worry more about its own bottom line than it does about the well-being of its impoverished borrowers, the majority of whom are women and who pay an average annual interest rate of 40 percent.
This twisted sense of priority could be seen after one of the worst cyclones in the history of Bangladesh left thousands dead in 2007, destroying entire villages and towns in its path. In the cyclone’s wake, the Omidyar-funded BRAC micro-lending debt collectors showed up at the disaster zone along with other micro-lenders, and went to work aggressively shaking down borrowers, forcing some victims (mostly women) to go so far as to sell their relief/aid materials, or to take out secondary loans to pay off the first loans.
According to a study about micro-lenders in the aftermath of Cyclone Sidr:
“Sidr victims who lost almost everything in the cyclone, experienced pressure and harassment from nongovernmental organisations (NGOs) for repayment of microcredit instalments. Such intense pressure led some of the Sidraffected borrowers to sell out the relief materials they received from different sources. Such pressure for loan recovery came from large organisations such as BRAC, ASA and even the Nobel Prize winning organisation Grameen Bank.
“Even the most severely affected people are expected to pay back in a weekly basis, with the prevailing interest rate. No system of ‘break’ or ‘holiday’ period is available in the banks’ current charter. No exceptions are made during a time of natural calamity. The harsh rules practised by the microcredit lender organisations led the disaster affected people even selling their relief assistance. Some even had to sell their leftover belongings to pay back their weekly instalments.”
These tactics may be harsh, but they pay off for micro-lenders. And it’s a lucrative operation: BRAC primarily targets women, offers loans with predatory interest rates and uses traditional values and close village relationships to shame and pressure borrowers into selling and doing whatever they can to make their weekly payments. It works. Loan recovery rates for the industry average between 95 and 98 percent. For BRAC, that rate was a comfy 99.3 percent.
So do predatory micro-loans really help lift the world’s poorest people out of poverty? Neoliberal ideology says they do — and the Omidyar Network represents one of the purest distillations of that ideology put into practice in the poorest and most vulnerable parts of the world.
As Cambridge University economics professor Ha-Joon Chang argued, saying of micro-lending:
“[It] constitutes a powerful institutional and political barrier to sustainable economic and social development, and so also to poverty reduction. Finally, we suggest that continued support for microfinance in international development policy circles cannot be divorced from its supreme serviceability to the neoliberal/globalization agenda.”
Omidyar Network has followed the same disastrous neoliberal script in other areas of investment, particularly its investments into privatizing public schools in the US and in poor regions of Africa.
One of the earliest Omidyar investments went to an online private charity website for needy public schools here in the US. As David Sirota wrote, huge billionaire foundations and corporations have been holding children hostage by starving public-school funding and replacing it with “charity” money from the likes of the Wal-Mart Foundation, Bill and Melinda Gates Foundation and Broad Foundation. We can add the Omidyar Network to this list as well.
Omidyar’s foundation invested in the same idea, but with a web 2.0 crowd-source twist: DonorsChoose.org allows individuals to pledge amounts as small as $10, and allows school teachers to get online asking for small sums to help their classrooms. The end result, of course, is that it normalizes the continued strangling of public schools and the sense that only private funding can save education.
Omidyar poured millions into DonorsChoose and organized donations from other Silicon Valley donors. At first, most public school teachers didn’t see the angle; many used the resource to raise funds for their own classrooms.
It wasn’t until DonorsChoose announced its partnership with the anti-public-education film “Waiting For Superman” that teachers realized they’d been duped. The movie promoted the myth that education could only be saved by the likes of Tea Party-backed school “reform” advocate Michelle Rhee. Teachers organized a boycott of DonorsChoose after the Omidyar-funded group announced it was essentially bribing its members with a $15 gift certificate to anyone who bought tickets for “Waiting for Superman.”
Overseas, the Omidyar Network is embarking on a school privatization program that will make DonorsChoose look like Mother Theresa’s handiwork. Omidyar provided seed capital for a new Africa-based for-profit private school enterprise for the poor called Bridge International. In 2009, ON gave Bridge a total of $1.8 million; Matt Bannick, the top figure (managing partner) in the Omidyar Network, sits on Bridge International’s board of directors.
Bridge International’s first schools are being built in Kenya, and are slated to expand across the sub-Sahara, hoping to rope millions of poor African kids into its schools. Bridge’s strategic partner is the for-profit education giant, Pearson. Diane Ravitch, former US Assistant Secretary of Education and critic of school “reform” efforts, has warned about Pearson’s near-monopolistic power influencing the privatization of American education (see Ravitch’s article“The Pearsonization of the American Mind.”)
The idea behind Bridge International is to provide a franchised “school in a box” model under which each school teaches the exact same curriculum at the exact same time to every student. Teachers are given minimal training—they’re merely required to teach according to the script given to them and read out to their students, scripts delivered through Nook tablets. Students pay $5 a month—a lot for each student in areas as poor as sub-Saharan Africa. Currently one new Bridge International school is opening every 2.5 days around Kenya, overtaking public education—with plans to expand further.
It sounds like a good idea, but the problem is that Bridge’s business model has a very narrow set of supporters, namely: free-market think-tanks, the global for-profit education industry and proponents of a neoliberal utopia who want to defund public education and replace it with private schooling. Bridge is only a few years old, but criticism of its educational model is already piling up—even from centrist pro-business thinktanks like the Brookings Institution. Even at $4 or $5 a month, Bridge’s “low cost” education is too expensive for many in the developing world, forcing children to go to work and making families choose between buying food and paying for education. Naturally, food wins out. And that simply means that many children can’t afford to go school, which only increases and reinforces stratification and inequality.
The fight against illiteracy requires free, quality education that’s available to all children. What it doesn’t need is a bunch of neoliberal techno-disruptors who want to turn education into a for-profit industry that provides schooling only to those who can afford it. And anyway, the very notion that you can squeeze enough profit from millions of the poorest children in the world to attract mega venture capital, while providing quality education is absurd. That profit money is extracted from the very people Bridge is supposedly trying to help.
Still think that Pierre Omidyar is a “different” type of billionaire? Still convinced he’s a one-of-a-kind “civic-minded” idealist?
Then you might want to ask yourself why Omidyar is so smitten by the ideas of an economist known as “The Friedrich Hayek of Latin America.” His name is Hernando de Soto and he’s been adored by everyone from Milton Friedman to Margaret Thatcher to the Koch brothers. Omidyar Network poured millions of nonprofit dollars into subsidizing his ideas, helping put them into practice in poor slums around the developing world.
In February 2011, the Omidyar Network announced a hefty $4.96 million grant to a Peru-based free-market think tank, the Institute for Liberty & Democracy (ILD).
Perhaps no single investment by Omidyar more clearly reveals his orthodox neoliberal vision for the world—and what constitutes “civic-mindedness”—than his support for the ILD and its founder and president, Hernando De Soto, whom the ON has tapped to participate in other Omidyar-sponsored events.
De Soto is a celebrity in the world of neoliberal/libertarian gurus. He and his Institute for Liberty & Democracy are credited with popularizing a free-market version of Third World land reform and turning it into policy in city slums all across the developing world. Whereas “land reform” in countries like Peru—dominated by a tiny handful of landowning families—used to mean land redistribution, Hernando De Soto came up with a counter-idea more amenable to the Haves: give property title to the country’s poor masses, so that they’d have a secure and legal title to their shanties, shacks, and whatever land they might claim to live on or own.
De Soto’s pitch essentially comes down to this: Give the poor masses a legal “stake” in whatever meager property they live in, and that will “unleash” their inner entrepreneurial spirit and all the national “hidden capital” lying dormant beneath their shanty floors. De Soto claimed that if the poor living in Lima’s vast shantytowns were given legal title ownership over their shacks, they could then use that legal title as collateral to take out microfinance loans, which would then be used to launch their micro-entrepreneurial careers. Newly-created property holders would also have a “stake” in the ruling political and economic system. It’s the sort of cant that makes perfect sense to the Davos set (where De Soto is a star) but that has absolutely zero relevance to problems of entrenched poverty around the world.
Since the Omidyar Network names “property rights” as one of the five areas of focus, it’s no surprise that Omidyar money would eventually find its way into Hernando De Soto’s free-market ideas mill. In 2011, Omidyar not only gave De Soto $5 million to advance his ideas—he also tapped De Soto to serve as a judge in an Omidyar-sponsored competition for projects focused on improving property rights for the poor. The more you know about Hernando De Soto, the harder it is to see Omidyar’s financial backing as “idealistic” or “civic-minded.”
For one thing, De Soto is the favorite of the very same billionaire brothers who play villains to Omidyar’s supposed hero—yes, the reviled Koch brothers. In 2004, the libertarian Cato Institute (neé “The Charles Koch Foundation”) awarded Hernando De Soto its biannual “Milton Friedman Prize”—which comes with a hefty $500,000 check—for “empowering the poor” and “advancing the cause of liberty.” De Soto was chosen by a prize jury consisting of such notable humanitarians as former Pinochet labor minister Jose Piñera, Vladimir Putin’s economic advisor Andrei Illarionov, Washington Post neoconservative columnist Anne Applebaum, FedEx CEO Fred Smith, and Milton Friedman’s wife Rosie. Milton was in the audience during the awards ceremony; he heartily approved.
Indeed, Hernando De Soto is de facto royalty in the world of neoliberal-libertarian gurus—he’s been called “The Friedrich von Hayek of Latin America,” not least because Hayek launched De Soto’s career as a guru more than three decades ago.
So who is Hernando De Soto, where do his ideas come from, and why might Pierre Omidyar think him deserving of five million dollars — ten times the amount the Koch Brothers awarded him?
De Soto was born into an elite “white European” family in Peru, who fled into exile in the West following Peru’s 1948 coup—his father was the secretary to the deposed president. Hernando spent most of the next 30 years in Switzerland, getting his education at elite schools, working his way up various international institutions based in Geneva, serving as the president of a Geneva-based copper cartel outfit, the International Council of Copper Exporting Countries, and working as an official in GATT (General Agreement on Trade and Tariffs).
De Soto didn’t return to live in Peru until the end of the 1970s, to oversee a new gold placer mining company he’d formed with a group of foreign investors. The mining company’s profits suffered due to Peru’s weak property laws and almost non-existent cultural appreciation of property title, especially among the country’s poor masses—De Soto’s investors pulled out of the mining venture after visiting the company’s gold mines and seeing hundreds of peasants panning on the company’s concessions. That experience inspired De Soto to change Peruvians’ political assumptions regarding property rights. Rather than start off by trying to convince them that foreign mining firms should have exclusive rights to gold from traditionally communal Peruvian lands, De Soto came up with a clever end-around idea: giving property title to the masses of Peru’s poor living in the vast shanties and shacks in the slums of Lima and cities beyond. It was a long-term strategy to alter cultural expectations about property and ownership, thereby improving the investment climate for mining companies and other investors. The point was to align the masses’ assumptions about property ownership with those of the banana republic’s handful of rich landowning families.
In 1979, De Soto organized a conference in Peru’s capital Lima, featuring Milton Friedman and Friedrich von Hayek as speakers and guests. At the time, both Friedman and Hayek were serving as key advisors to General Augusto Pinochet’s “shock therapy” program in nearby Chile, an economic experiment that combined libertarian market policies with concentration camp terror.
Two years after De Soto’s successful conference in Lima, in 1981, Hayek helped De Soto set up his own free-market think tank in Lima, the “Institute for Liberty and Democracy” (ILD). The ILD became the first of a large international network of right-wing neoliberal think tanks connected to the Mother Ships—Cato Institute, Heritage Foundation, and Britain’s Institute for Economic Affairs, Margaret Thatcher’s go-to think tank. By 1983, De Soto’s Institute was also receiving heavy funding from Reagan’s Cold War front group, the National Endowment for Democracy, which promoted free-market think tanks and programs around the world, and by the end of Reagan decade, De Soto produced his first manifesto, “The Other Path”—a play on the name of Peru’s Maoist guerrilla group, Shining Path, then fighting a bloody war for power. But whereas the Shining Path’s political program called for nationalizing and redistributing property, most of which was in the hands of a few rich families, De Soto’s “Other Path” called for maintaining property distribution as it was, and legalizing its current structure by democratizing property titles, the pieces of paper with the stamps. Everyone would become a micro-oligarch and micro-landowner under this scheme…
With help and funding from US and international institutions, De Soto quickly became a powerful political force behind the scenes. In 1990, De Soto insinuated himself into the inner circle of newly-elected president Alberto Fujimori, who quickly turned into a brutal dictator, and is currently serving a 25-year prison sentence for crimes against humanity, murder, kidnapping, and illegal wiretapping.
Under De Soto’s influence, Fujimori’s politics suddenly changed; almost overnight, the populist Keynsian candidate became the free-market authoritarian “Chinochet” he governed as. As Fujimori’s top advisor, Hernando De Soto was the architect of so-called “Fujishock” therapy applied to Peru’s economy. Officially, De Soto served as Fujimori’s drug czar from 1990-1992, an unusual role for an economist given the fact that Peru’s army was fighting a brutal war with Peru’s powerful cocaine drug lords. At the time Peru was the world’s largest cocaine producer; as drug czar, Hernando De Soto therefore positioned himself as the point-man between Peru’s military and security services, America’s DEA and drug czar under the first President Bush, and Peru’s president Alberto Fujimori. It’s the sort of position that you’d want to have if you wanted “deep state” power rather than mere ministerial power.
During those first two years when De Soto served under Fujimori, human rights abuses were rampant. Fujimori death squads—with names like the “Grupo Colina”—targeted labor unions and government critics and their families. Two of the worst massacres committed under Fujimori’s reign, and for which he was later jailed, took place while De Soto served as his advisor and drug czar.
The harsh free-market shock-therapy program that De Soto convinced Fujimori to implement resulted in mass misery for Peru. During the two years De Soto served as Fujimori’s advisor, real wages plunged 40%, the poverty rate rose to over 54% of the population, and the percentage of the workforce that was either unemployed or underemployed soared to 87.3%.
But while the country suffered, De Soto’s Institute for Liberty and Democracy—the outfit that Omidyar gave $5 million to in 2011—thrived: its staff grew to over 100 as funds poured in. A World Bank staffer who worked with the ILD described it as,
“a kind of school for the country. Most of the important ministers, lawyers, journalists, and economists in Peru are ILD alumni.”
In 1992, Fujimori orchestrated a constitutional coup, disbanding Peru’s Congress and its courts, and imposing emergency rule-by-decree. It was another variation of the same Pinochet blueprint.
Just before Fujimori’s coup, De Soto indemnified himself by officially resigning from the cabinet. However in the weeks and months after the coup, De Soto provided crucial PR cover, downplaying the coup to the foreign press. For instance, De Soto told the Los Angeles Times that the public should temper their judgment of Fujimori’s coup:
“You’ve got to see this as the trial and error of a president who’s trying to find his way.”
In the New York Times, De Soto spun the coup as willed by the people, the ultimate democratic politics:
“People are fed up, fed up…[Fujimori] has attacked two hated institutions at just the right time. There is an enormous need to believe in him.”
Years later, Fujimori’s notorious spy chief Vladimiro Montesinos testified to Peru’s Congress that De Soto helped mastermind the 1992 coup. De Soto denied involvement; but in 2011, two years after Fujimori was jailed for crimes against humanity, De Soto joined the presidential campaign for Keiko Fujimori, the jailed dictator’s daughter and leader of Fujimori’s right-wing party. Keiko Fujimori ran on a platform promising to free her father from prison if she won; De Soto spent much of the campaign red-baiting her opponent as a Communist. That led Peru’s Nobel Prize-winning author Mario Vargas Llosa to denounce De Soto as a “fujimontesenista” with “few democratic credentials.”
So in the same year that De Soto was trying to put the daughter of Peru’s Pinochet in power and to spring the dictator from prison, Omidyar Network awarded him $5 million.
It was during Fujimori’s dictatorial emergency rule, from 1992-94, that De Soto rolled out a property-title pilot program in Lima, in which 200,000 households were given formal title. In 1996, Fujimori implemented De Soto’s property-titling program on a national scale, with help from the World Bank and a new government property agency staffed by people from De Soto’s Institute for Liberty and Democracy. By 2000, the magical promise of an explosion in bank credits to all the new micro-property owners never materialized; in fact, there was no noticeable difference in bank lending to the poor whatsoever, whether they had property title or not.
The World Bank and the project’s neoliberal supporters led by Hernando De Soto were not happy with data showing no uptick in lending, which threatened to unravel the entire happy theory behind property titling as the answer to Third World poverty. De Soto was in the process of peddling the same property-titling program to countries around the world; data was needed to justify the program. So the World Bank funded a new study in Peru in the early 2000s, and discovered something startling: In homes that had formal property titles, the parents in those homes spent up to 40% more time outside of their homes than they did before they were given title. De Soto took that statistic and argued that it was a good thing because it proved giving property title to homeowners made them feel secure enough to leave their shanties and shacks. The assumption was that in the dark days before shanty dwellers had legal titles, they were too scared to leave their shacks lest some other savage steal it from them while they were out shopping.
No one ever conclusively explained why shanty parents were spending so much more time outside of their homes, but the important thing was that it made everyone forget the utter failure of the property title program’s core promise—that property titles would ignite micro-lending thanks to the collateral of the micro-entrepreneur’s micro-shack as collateral. Thanks to De Soto’s salesmanship and the backing of the world’s neoliberal nomenklatura — Bill Clinton called De Soto “the world’s greatest living economist” and he was praised by everyone from Milton Friedman to Vladimir Putin to Margaret Thatcher. The disappointing results in Peru were ignored, and De Soto’s program was extended to developing countries around the world including Egypt, Cambodia, the Philippines, Indonesia and elsewhere. And in nearly every case, De Soto’s Institute for Liberty and Democracy has taken the lead in advising governments and selling the dream of turning titled slum-dwellers into micro-entrepreneurs.
The real change brought by De Soto’s property-titling program has ranged from nil to nightmarish.
In Cambodia, where the World Bank implemented De Soto’s land-titling program in 2001, poor and vulnerable people in the capital Phnom Penh have suffered at the hands of land developers and speculators who’ve used arson, police corruption and violence to forcibly evict roughly 10% of the city’s population from their homes in more valuable districts, relocating them to the city outskirts.
An article in Slate titled “The De Soto Delusion” described what happened in Cambodia when the land-titling program was first implemented:
“In the nine months or so leading up to the project kickoff, a devastating series of slum fires and forced evictions purged 23,000 squatters from tracts of untitled land in the heart of Phnom Penh. These squatters were then plopped onto dusty relocation sites several miles outside of the city, where there were no jobs and where the price of commuting to and from central Phnom Penh (about $2 per day) surpassed whatever daily wage they had been earning in town before the fires. Meanwhile, the burned-out inner city land passed immediately to some of the wealthiest property developers in the country.”
De Soto and his Institute for Liberty and Democracy have advised property-title programs elsewhere too—Haiti, Dominican Republic, Panama, Russia—again with results ranging from nil to bad. Even where it doesn’t lead to mass evictions and violence, it has the effect of shifting a greater tax burden onto the poor, who end up paying more in property taxes, and of forcing them to pony up for costly filing fees to gain title, fees that they often cannot afford. Property title in and of itself—without a whole range of reforms in governance, corruption, education, income, wealth distribution and so on—is clearly no panacea. But it does provide an alternative to programs that give money to the poor and redistribute wealth, and that alone is a good thing, if you’re the type smitten by Hernando De Soto—as Omidyar clearly is.
Studies of property-titling programs in the slums of Brazil and Manila revealed that it created a new bitterly competitive culture and bifurcation, in which a small handful of titled slum dwellers quickly learn to benefit by turning into micro-slumlords renting out dwellings to lesser slum dwellers, who subsequently find themselves forced to pay monthly fees for their shanty rooms—creating an underclass within the underclass. De Soto has described these slums as “acres of diamonds”—wealth waiting to be unlocked by property titling—and his acolytes even coined a new acronym for slums: “Strategic Low-income Urban Management Systems.”
All of which begs the obvious question: If De Soto’s property-title program is such a proven failure in case after case, why is it so popular among the world’s political and business elites?
The answer is rather obvious: It offers a simple, low-cost, technocratic market solution to the problem of global poverty—a complex and costly problem that can only be alleviated by dedicating huge amounts of resources and a very different politics from the one that tells us that markets are god, markets can solve everything. Even before Omidyar committed $5 million to the dark plutocratic “idealism” De Soto represents, he was Tweeting his admiration for De Soto:
“Brilliant dinner with Hernando de Soto. Property rights underlie and enable everything.”
Indeed, property rights underlie and enable everything Omidyar wants to hear—but distract and divert from what the targets of those programs might actually need or be asking for.
Which brings us back to the wonderful words written about Pierre Omidyar last month: Where is the proof that he’s a “civic-minded” billionaire, a “different” billionaire, an “idealistic” billionaire who’s in it for ideals and not for profit? How is Omidyar any different from any other billionaire—when he is funding the same programs and pushing the same vision for the world backed by the Kochs, Soros, Gates, and every other neoliberal billionaire?
When you scratch the surface of his investments and get a sense of what sort of ideal world he’d like to make, it becomes clear that Omidyar is no different from his peers.
And the reason that matters, of course, is because Pierre Omidyar’s dystopian vision is merging with Glenn Greenwald’s and Laura Poitras’ monopoly on the crown jewels of the National Security Agency — the world’s secrets, our secrets — and using the value of those secrets as the capital for what’s being billed as an entirely new, idealistic media project, an idealism that the CJR and others promise will not shy away from taking on power.
The question, however, is what defines power to a neoliberal mind? We’re going to take a wild guess here and say: The State.
So brace yourself, you’re about to get something you’ve never seen before: billionaire-backed journalism taking on the power of the state. How radical is that? To quote “60 Minutes” producer Lowell Bergman:
“What has been adjudicated and established in the wake of Vietnam and the Civil Rights movement is the ability of the press to basically write or broadcast almost anything about the government.There’s very few restrictions in that way. It’s not true when we’re talking about private power, especially major Fortune 500 corporations, or people worth more than, say, a billion dollars.”
In other words: look out Government, you’re about to be pummeled by a crusading, righteous billionaire! And corporate America? Ah, don’t worry. Your dirty secrets—freshly transferred from the nasty non-profit hands of the Guardian to the aggressively for-profit hands of Pierre Omidyar—are safe with us.
Chomsky’s Right: The New York Times’ Latest Big Lie November 18, 2013Posted by rogerhollander in Foreign Policy, Iran, Media.
Tags: chomsky, enrich uranium, Iran, iran nuclear, israel nuclear, john kerry, journalism, Media, new york times, non-proliferation, nonproliferation, nuclear deterrence, patrick smith, roger hollander
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Salon.com / By Patrick Smith
More misleading half-truths from a paper too cowed by power and myth to tell the truth about U.S. foreign policy.
Photo Credit: Shutterstock.com/Northfoto
Tags: angela merkel, edward snowden, first amendment, freedom of press, general alexander, glenn greenwald, journalism, keith alexander, Media, nsa, roger hollander, surveillance, surveillande state, whistle-blowing
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The most under-discussed aspect of the NSA story has long been its international scope. That all changed this week as both Germany and France exploded with anger over new revelations about pervasive NSA surveillance on their population and democratically elected leaders.
As was true for Brazil previously, reports about surveillance aimed at leaders are receiving most of the media attention, but what really originally drove the story there were revelations that the NSA is bulk-spying on millions and millions of innocent citizens in all of those nations. The favorite cry of US government apologists -–everyone spies! – falls impotent in the face of this sort of ubiquitous, suspicionless spying that is the sole province of the US and its four English-speaking surveillance allies (the UK, Canada, Australia and New Zealand).
There are three points worth making about these latest developments.
• First, note how leaders such as Chancellor Angela Merkel reacted with basic indifference when it was revealed months ago that the NSA was bulk-spying on all German citizens, but suddenly found her indignation only when it turned out that she personally was also targeted. That reaction gives potent insight into the true mindset of many western leaders.
• Second, all of these governments keep saying how newsworthy these revelations are, how profound are the violations they expose, how happy they are to learn of all this, how devoted they are to reform. If that’s true, why are they allowing the person who enabled all these disclosures – Edward Snowden – to be targeted for persecution by the US government for the “crime” of blowing the whistle on all of this?
If the German and French governments – and the German and French people – are so pleased to learn of how their privacy is being systematically assaulted by a foreign power over which they exert no influence, shouldn’t they be offering asylum to the person who exposed it all, rather than ignoring or rejecting his pleas to have his basic political rights protected, and thus leaving him vulnerable to being imprisoned for decades by the US government?
Aside from the treaty obligations these nations have to protect the basic political rights of human beings from persecution, how can they simultaneously express outrage over these exposed invasions while turning their back on the person who risked his liberty and even life to bring them to light?
• Third, is there any doubt at all that the US government repeatedly tried to mislead the world when insisting that this system of suspicionless surveillance was motivated by an attempt to protect Americans from The Terrorists™? Our reporting has revealed spying on conferences designed to negotiate economic agreements, the Organization of American States, oil companies, ministries that oversee mines and energy resources, the democratically elected leaders of allied states, and entire populations in those states.
Can even President Obama and his most devoted loyalists continue to maintain, with a straight face, that this is all about Terrorism? That is what this superb new Foreign Affairs essay by Henry Farrell and Martha Finnemore means when it argues that the Manning and Snowden leaks are putting an end to the ability of the US to use hypocrisy as a key weapon in its soft power.
Speaking of an inability to maintain claims with a straight face, how are American and British officials, in light of their conduct in all of this, going to maintain the pretense that they are defenders of press freedoms and are in a position to lecture and condemn others for violations? In what might be the most explicit hostility to such freedoms yet – as well as the most unmistakable evidence of rampant panic – the NSA’s director, General Keith Alexander, actually demanded Thursday that the reporting being done by newspapers around the world on this secret surveillance system be halted (Techdirt has the full video here):
The head of the embattled National Security Agency, Gen Keith Alexander, is accusing journalists of “selling” his agency’s documents and is calling for an end to the steady stream of public disclosures of secrets snatched by former contractor Edward Snowden.
“I think it’s wrong that that newspaper reporters have all these documents, the 50,000 – whatever they have and are selling them and giving them out as if these – you know it just doesn’t make sense,” Alexander said in an interview with the Defense Department’s “Armed With Science” blog.
“We ought to come up with a way of stopping it. I don’t know how to do that. That’s more of the courts and the policy-makers but, from my perspective, it’s wrong to allow this to go on,” the NSA director declared. [My italics]
There are 25,000 employees of the NSA (and many tens of thousands more who work for private contracts assigned to the agency). Maybe one of them can tell The General about this thing called “the first amendment”.
I’d love to know what ways, specifically, General Alexander has in mind for empowering the US government to “come up with a way of stopping” the journalism on this story. Whatever ways those might be, they are deeply hostile to the US constitution – obviously. What kind of person wants the government to forcibly shut down reporting by the press?
Whatever kind of person that is, he is not someone to be trusted in instituting and developing a massive bulk-spying system that operates in the dark. For that matter, nobody is.
When Canada made Afghanistan worse October 14, 2013Posted by rogerhollander in Canada, Iraq and Afghanistan, Media, War.
Tags: Afghanistan, Afghanistan War, Canada, canada afghanistan, canada military, graeme smith, jeffrey simpson, kabul, kandahar, Media, NATO, roger hollander, Taliban
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Roger’s note: I cannot agree with one of the author’s statements, to wit, that the West, including Canadians, “unintentionally” made things worse. I don’t believe that “the West, including Canadians” (meaning governments, not necessarily citizens) gives a damn about the welfare of the Afghan people; the sole intention for the illegal invasion, occupation and destruction of the country has to do entirely with the geopolitical (oil, military, industrial, arms sales, etc.) objectives of the United States and its lackeys. Nor do I agree with the conclusion that NATO involvement should continue, which in essence contradicts the rest of the article.
In those early, hopelessly naive years, when Canadian soldiers and their energetic general encamped in Kandahar to kill “scumbags” and set Afghanistan on the road to democracy, the accompanying media fell into line – in love with the general, the soldiers and their mission.
The early coverage was largely ahistorical, gung-ho, a big group hug for the Canadians – a travesty of journalism, really. What Canadians needed then was a clear-eyed analysis of the country and its history, an understanding of its regional antagonisms, an appreciation of the daunting, even impossible task Canada and its government – to say nothing of the entire North Atlantic Treaty Organization – had signed up for in that forbidding, post-medieval place.
Many years later, as the Americans prepare to withdraw their forces and the last Canadians (trainers for the Afghan army) can see the end of their time in Afghanistan, Westerners will have left behind graveyards of their fallen and a country still corrupt, tribally divided and closer to civil strife than civil peace.
After that first full flush of nonsense reporting that, in fairness, played well at home and was supplemented by the country’s biggest windbag on Hockey Night in Canada, along came another group of correspondents, sympathetic to the troops and their travails, of course, but willing to question the party line and explore beyond the perimeters of the Canadian base in Kandahar.
There were some very good journalists in this group, brave men and women in a place growing more violent every day. One lost her life. Another was held hostage. Another was seriously wounded.
The Globe and Mail’s Graeme Smith (now with the International Crisis Group in Kabul) was among them. He stayed longer than most, took extraordinary risks around Kandahar and in Quetta across the Pakistani border, interviewed the Taliban (despite criticism for giving a microphone to the enemy) and, more than anyone else, exposed the story of Afghan prisoner detainees turned over by Canadians and other NATO forces to local authorities, who tortured and abused them.
Canada’s government lied about many aspects of the detainee affair, insisting that Ottawa didn’t know what was happening or that Afghan authorities were examining all allegations of misconduct – despite memos from Canadian officials on the ground saying that wasn’t so.
Mr. Smith explains the detainee affair, from the prison where he visited and interviewed prisoners to the government’s mendacity in the House of Commons, in The Dogs Are Eating Them Now, a memoir of his correspondent days in Kandahar and Kabul. But the detainees represent but one small part of a wise, enthralling, detailed, realistic account of his time in Afghanistan.
Many are the lessons from Mr. Smith’s book, but one emerges above all: that the presence of foreigners did not necessarily turn the tide against the Taliban. Indeed, the foreigners’ military forays and strange (to the Pashtuns) ways may even have allowed the Taliban to survive and, ultimately, to grow.
Mr. Smith doesn’t say so, but he would be honest to admit that his portrait is of only one part of a sprawling, diverse country. There were and are much less violent parts of Afghanistan, where leaders fought against the Taliban before and might do so again after the Americans leave.
His is a picture of Kandahar and its surroundings, where the Pashtun code of tribal identity and revenge has for centuries proved difficult for foreigners to understand. In southern Afghanistan, at any rate, “we are leaving behind an ongoing war; at worst, it’s a looming disaster,” Mr. Smith says.
How the West, including Canadians, unintentionally made things worse is a textbook case of cross-cultural misunderstanding and hubris. The West will tell itself heroic stories, then forget about Afghanistan.
Perhaps unexpectedly, given his depressing account, Mr. Smith concludes that saying goodbye would be a mistake. The Afghan government Westerners leave behind will need support, and lots of it. Without foreign money and help, he argues, the chances of a moderately peaceful Afghanistan seem remote – as remote as that support continuing.