�NED and the Empire's New Clothes ::: International Endowment for Democracy

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International Endowment for Democracy
www.internationalendowmentfordemocracy.org ���or��� www.iefd.org

NED and the Empire's New Clothes

By James Ciment and Immanuel Ness

Since the first Reagan administration, the U.S. taxpayer has been enlistedin the export of "American-style democracy" through a hybrid organizationcalled the National Endowment for Democracy (NED). The component parts ofthe NED¡ªthe two major political parties, big business, and biglabor¡ªrepresent the acceptable boundaries of American politics. The NED, ineffect, represents the American system. And by giving it its missionaryrole, the U.S. government could not be sending a clearer message abroad:that this is how politics must be.

The modern promotion of U.S.-style democracy abroad stems from anearlier form of American ethnocentrism, one which posited that the rest ofthe world, not being like us, was dangerous, probably evil. Foreign policyconsisted of promoting our sons of bitches on the grounds that theirs poseda threat to world peace.

However, according to NED president, Carl Gershman, the NED has movedbeyond the old sterile argument that the U.S. should favor authoritarianregimes over totalitarian ones, "a debate which was based upon theassumption that the best we could hope for was the lesser evil."[1]

Gershman¡ªwho has headed the program virtually since itsinception¡ªknows whereof he speaks. Before taking up his NED post, he servedas aide to Reagan's U.N. Ambassador Jeane Kirkpatrick, whose sole claim togeopolitical fame is the now wholly discredited theory that America shouldsupport authoritarian regimes over totalitarian ones because the former weremore prone to reform.[2] Before that, he was chairman of Social Democrats-USAand an intellectual gofer for AFL-CIO president Lane Kirkland.

Indeed, consistent with an SD-USA line, so-called totalitarian stateswere targeted by the NED. For example, groups connected to the reactionaryPolish Catholic Church were offered grants during the 1980s. But other moneywent to countries that might strike the uninitiated as not especially inneed of American-sponsored tutelage in democracy¡ªthat is, "dictatorships"like Costa Rica and France, where right-wing opponents of Nobel Peace Prizewinner Oscar Arias and Socialist President François Mitterand receivedgrants. In effect, NED's program could have been written by Kirkland andsome of his neoconservative allies.

Overall, in its first ten years of operations, the NED¡ªwhose fundingcomes from Congress but whose grants are dispersed largely by four privatefoundations (the Republican Party-controlled International RepublicanInstitute, the Democratic Party's National Democratic Institute, thequasi-independent and politically correctly named American Center forInternational Labor Solidarity [formerly the Free Trade Union Institute],and the U.S. Chamber of Commerce-headed Center for International PrivateEnterprise)¡ªspent roughly $200 million dollars on some 1,500 grants.[3]Although backing pro-American political forces abroad has always been themain weave of the program, the promotion of American-style business unionismrepresents a critical accessory.

A History of Cooperation

Of course, the history of American union-government overseas cooperationgoes back decades. Long before the NED was a glint in the Reaganadministration's eye, conservative AFL-CIO presidents George Meany, andlater Kirkland, actively collaborated with the Central Intelligence Agencyin identifying militant labor leaders and infiltrating popular, mass-basedlabor movements (see the articles by Anthony Carew and Douglas Valentine inthis issue). Moreover, the AFL-CIO participated in the formation of rump, or"kept," labor organizations and sought to promote new leaders, usuallythrough patronage, who opposed any fundamental change and favored the U.S.model of trade unionism that sees labor as just another interest group¡ªnotthe basis of class struggle.

Then, in its first decade, the NED worked with the AFL-CIO toundermine militant labor movements, while fostering "democratic andindependent trade unions," a thinly veiled euphemism for American-inspiredlabor organizations devoid of worker participation. Before the collapse ofthe Soviet Union, Washington recognized that working-class organizationswere bound to form throughout the world. Thus, the NED/AFL-CIO's major goalwas undermining any movement that displayed pro-Soviet tendencies. The twoencouraged the formation of relatively weak and feeble trade unions thatopposed state control over national economies, such as the Force Ouvriere inFrance, the Federation of Korean Trade Unions in South Korea, and the FreeChina Labor League in the People's Republic of China. The NED used theAFL-CIO as an extension of American Cold War policy to promote toothlesslabor organizations¡ªusually in the form of labor federations withleadership over national labor movements¡ªas a foil for genuine labormovements. In Poland, however, the grantee of choice was Solidarity, whichdid, in effect, undermine the regime.

The NED's operations were carried out through the AFL-CIO's foreignlabor organizations, the American Institute for Free Labor Development(AIFLD); the Asian-American Free Labor Institute (AAFLI), and theAfrican-American Labor Center (AALC). Operations were concentrated inregions where significant labor movements¡ªsuch as those in South Africa andSouth Korea¡ªposed a special threat to the interests of transnationalcorporations and U.S. foreign policy.

Since the fall of communist and authoritarian regimes around the worldin the early 1990s, the program has promoted "the globalization ofdemocracy" because, a recent NED annual report has stated, "it works,"though neither "work" nor "democracy" seem to have much to do with theprogram; indeed, it is unclear that there is a single example of politicalreform, democratic or otherwise, anywhere in the world that can beattributed to an NED program.

Rather, the NED serves two functions. First, it exists as ajunket-sponsoring cash cow for "conventional-wisdom"-spouting politicalexperts, right-wing ideologues, rabidly anticommunist and frequently corrupttrade unionists, and businesspeople hot on the trail of emerging marketopportunities. Much of the money lavished by the program is spent sponsoringconferences in exotic lands, where the participants get no closer to thedemocracy-deprived persons they claim to serve than the maids at thefour-star hotels where they hole up.

Harper's magazine editor David Samuels, who reported on a 1995NED-sponsored conference at the elegant Esplanade Hotel in Zagreb, Croatia,summed up the absurdity of the event¡ªthe theme of which was "StrengtheningDemocracy." "All the [Eastern European] participants now understand...theAmericans have come to talk not to them but to each other," Samuels noted."For the next two days, [the Americans] will eat all they can at thebreakfast buffet...order coffee from room service, and watch CNN and MTV,all the while feeling guilty about the great and unnecessary expenses theyhave incurred in order to come here."[4]

Waste and Corruption

But extravagant waste is just part of the problem. Over the years, the NEDhas also faced numerous corruption charges of its own. Irving Brown, aGershman mentor, was accused of funneling NED funds to right-wing groups inFrance, such as the Union Nationale Inter-universitaire, in the mid-1980sfor overt political activities. In February, an appeals court overturned asuit the right-wing Cuban American National Foundation (CANF) had broughtagainst the former chief of the U.S. Interests Section in Havana, WayneSmith.[5] Smith had charged¡ªtruthfully, the court's decision implied¡ªthat theNED gave nearly $400,000 to CANF between 1984 and 1988 at the same time thefoundation was setting up a political action committee that donated an equalamount to the campaigns of pro-CANF congressmen in Washington. Federal lawprohibits the use of government funds for campaign purposes.

In a 1993 report, Barbara Conry of the libertarian Cato Institute¡ªanoutspoken foe of U.S. foreign aid¡ªnoted that General Accounting Officeaudits "have repeatedly revealed financial mismanagement at the program,"including personal credit card payments made from NED accounts and granteesfiling rent receipts and staff payments for non-existent offices.[6]

Yet the NED has survived numerous attempts to kill it. Most recently,after Clinton proposed upping its budget by half in 1994, freshmenRepublicans in the House voted to cut off all funding, as an anti-foreignaid gesture. But the effort was reversed by the Senate after appearancesfrom Andrei Sakharov's widow, Elena Bonner, and no less than threeex-presidents: Ford, Carter, and Bush. Still, some of the organization's $31million annual budget does get through to recipients. And when it does, theagenda is an insidious one.

Again, labor unions offer a useful example. In South Africa, the NEDand AFL-CIO sought to undermine the growth of the Congress of South AfricanTrade Unions, a Black federation that had close ties to the South AfricanCommunist Party. On the other side of the globe, in South Korea, the NEDsupported and funded the development of the FKTU, the government-dominatedlabor federation, in opposition to the more militant KCTU independent laborfederation, which has advocated greater workers rights and democracy andwaged damaging strikes against leading corporations, even after Washingtonwent on record praising the establishment of the KCTU as a sign of growingcivic pluralism in South Korea.

Conversely, the NED has refused to support the Federation ofIndependent Trade Unions of Russia¡ªdespite the fact that it represents thevast majority of Russian workers and has displayed a remarkable degree ofindependence and militancy since the fall of the Soviet Union¡ªbecause it wasoriginally a creation of the Soviet government. Thus, the NED continues toevince its roots in Kirkpatrick-inspired political theory, supporting theKorean federation organized by a formerly authoritarian regime but refusingto work with a Russian one, because it was set up by a communist government.

None of this surprises veteran NED watchers, as they note how theprogram was founded both to replace and augment traditional covert fundingto pro-American political groups around the world. Hoping to diminish theimpact of the 1970's congressional exposés of CIA covert action, the NED wasintended as a respectable, overt means to the same ends. As Allen Weinstein,founding and then acting president of the NED told the Washington Post in1991, "a lot of what we do today was done covertly 25 years ago by theCIA."[7]

Weinstein was not being entirely fair; the NED¡ªthough its fundingremains a fraction of that still devoted to covert action by the CIA¡ªoffersa more subtle, sophisticated, and politically acceptable method forfurthering U.S. foreign policy interests. Where the Cold War-era CIA oncecrushed genuinely democratic movements and organizations in countries alliedwith the U.S., the NED attempts to coopt them¡ªby making them dependent onU.S. funding or by recruiting their leaders¡ªor exclude them altogether froma political consensus shaped in America's own image.

In his pathbreaking book on America's newly revised role as civicsteacher to the world, William Robinson points out the connection between thepromotion of globalized markets and polyarchy, a kind of "low intensity"democracy in which multiple voices and institutions broaden civicparticipation¡ªor, at least, the appearance of same¡ªwhile at the same timeexcluding more "excessive," high intensity forms like the original lavalasmovement in Haiti, radical free trade unionism in South Korea and SouthAfrica, or anti-free market parties in Russia.[8]

Realpolitik

Saluting the efforts of NED and its partners¡ªthe Agency for InternationalDevelopment (AID), the U.S. Information Agency (USIA), Voice of America andothers¡ªDeputy Secretary of State Strobe Talbott formulated the equation morecrudely. "It's an issue not just of moral politik, but of realpolitik," hetold a Carnegie Endowment for International Peace audience in 1996."Democracies are more likely to be reliable partners in trade and diplomacyand more likely to pursue foreign and defense policies that are compatiblewith American interests."[9]

This, of course, is nothing new. Washington has mouthed banal paeansto democracy. Even Henry Kissinger's overwrought memoir¡ªYears ofRenewal¡ªmakes the argument that the Nixon State Department's role in theoverthrow and murder of Salvador Allende¡ªChile's popularly electedpresident¡ªwas yet another milestone in America's ongoing crusade to furtherdemocracy around the world.[10]

Still, to fully understand the NED's mission, it is necessary to thinkin terms of supply as well as demand. Clearly, the demand side of promotingdemocracy has changed with the fall of communism; pro-American forcesabroad, NED supporters recognize, should be finessed rather than coerced. Atthe same time, the NED is a more pluralistic institution than was the CIA.

The NED's political durability is guaranteed through bipartisansupport, says analyst Elizabeth Cohn, author of a forthcoming report on theAmerican democracy-promoting institutions.[11] But to maintain this support,it must give a piece of the action to each of the elements that comprisewhat Cohn calls "Democracy, Inc.": the Democratic and Republican parties,mainstream unionism, and the business community. This diversity, of course,is no broader than the ruling institutions of America, and, as there, theright remains in the ascendance.

Yet, says Cohn, to understand what the NED does, "we have to movebeyond the Cold War framework of thinking. Some of what it promotes we[progressives] would all support," just as, presumably, there are thingsabout the American form of democracy that we agree with. The NED "wasclearly set up to create a world in the image of U.S.-style democracy."This, of course, begs two important questions: Is American-style democracy agood thing for the world? And what happens when forces abroad seek anotherform of democracy? The first question is left to the reader to answer. Thesecond can best be understood by looking at the record.[12]

In locations as far afield as Serbia, Mongolia, and Peru, the NEDplays a zero-sum game. The money and perks it dispenses¡ªmeasly by Americanstandards but enticing to half-starved democracy advocates in the developingand former communist worlds¡ªlures the best and the brightest overseas,ensconcing them in organizations approved by NED and, since all NED grantsmust ultimately receive State Department approval, by Washington.[13] There,the locals get caught up in a process where the rules and boundaries ofpermissible ideological content and political activism are laid down byNED-approved American political experts and ideologues. At the same time,more radical, "excessive" democratic movements and institutions dry up.

And just as the NED's board of directors ranges from the liberal(former New York University President John Brademas) to the moderate (formerNew Jersey Governor Tom Kean) to the extreme right (Reagan's Undersecretaryof Defense Fred Iklé), so NED-sponsored projects vary from the worthy(funding anti-dictatorship newspapers among Burmese exiles) to theridiculous (distributing tens of thousands of copies of Newt Gingrich's"Contract with America," retitled as "Contract with the Mongolian Voter") tothe vicious (supporting former Front for the Advancement and Progress ofHaiti-FRAPH-members).

Yet, during the 1990s, the political consensus that gave the NED itspluralistic cover and assured it bipartisan support in Washington has frayedsomewhat. Congressional Republicans have opposed the NED or any organizationthat favors even watered-down labor rights, while it has attempted topromote labor unions that embrace neo-liberal capitalist principles. In theformer Soviet Union, the NED and the AFL-CIO have sponsored independentunions representing the approximately five percent of all workers in Russiawho were supporting privatization against the former communist Federation ofIndependent Trade Unions of Russia (FNPR). As the 45 million-member FNPRopposed privatization, the NED-inspired federation defended governmentneoliberal reforms.

Changing Orientation

At the same time, the election in 1995 of John Sweeney as president of theAFL-CIO significantly changed the orientation of the American labor movementin the international arena. In the post-World War II era, the AFL-CIO hasbeen one of the great labor failures worldwide as membership has declinedfrom 35 percent of the labor force in 1955 to about 15 percent in 1995. Anyforeign labor movement looking to the AFL-CIO could see that it was an utterfailure and a poor model for building worker power. Indeed, by 1995, evenAmerican workers were aware of this failure. Though old cold warriors withinthe AFL-CIO continued to support the international policy of promoting weakunions worldwide, the new leadership sees neoliberal capitalism as thegreater threat to labor.

Shortly after Sweeney became president, the four internationalinstitutes of the AFL-CIO were closed and folded into the American Centerfor International Labor Solidarity (ACILS), an NED front organization inWashington known colloquially as the "Solidarity Center" and founded byAFL-CIO, AID, and the NED. Asked if the AFL-CIO continues to work with theU.S. government in undermining progressive labor unions abroad, SanFrancisco-based labor activist Michael Eisenscher noted, "most of the spooksfrom the CIA that were on the Federation's payroll have been mothballed."[14]At the same time, the AFL-CIO has supported progressive labor activists thatthe U.S. government considers suspect. The AFL-CIO's delegate to ahemispheric labor conference held in San Francisco last year intervened withthe State Department to get visas for communist labor leaders from Chile toattend.

Nevertheless, the AFL-CIO continues to take NED funding and use it forpurposes that remain in sync with the program's overall agenda. In Russia,for example, an AFL-CIO backed-campaign against the non-payment of wages byRussian industry leans toward amelioration of the symptoms, rather than amilitant attack on the cause: the Yeltsin government's wholehearted embraceof free market ideology.

Meanwhile, the AFL-CIO's partial defection¡ªthough denying the NED animportant domestic constituency and a union cover for its pro-free marketactivities abroad¡ªhas not stopped the program's work in this field. ACILShas taken over the AFL-CIO's regional field offices throughout the world andhas reinforced the federation's contacts, in order to promote the faddishprinciples of neoliberal capitalism and the development of "free democraticand independent trade unions." Although the AFL-CIO is not actively involvedin the operations of ACILS, some of its international unions, particularlythe once staunchly anticommunist American Federation of Teachers, areactively involved in its educational and institution-building affairs,particularly in the former communist bloc. And, of course, NED's politicalwing has actively supported Russian president Yeltsin and his allies,offering funds to 41 parliamentarians in the 1996 elections (despite NEDrules that funding not go directly to politicians abroad) and even providingmake-over artists so that Yeltsin could go on television without lookinglike a walking corpse.[15]

With or without the AFL-CIO, the NED continues to serve Americanforeign policy, funding organizations that promote economic restructuring,undermine workers' rights, and increase layoffs, while paying lip service tolabor rights. In China, it funds organizations that encourage privatizationand train employers in anti-labor strategies. Moreover, in 1997, while theNED offered extensive funding for an American-inspired free labordevelopment in Burma, it provided no support for a grassroots labor movementin American ally Indonesia under Suharto, the recently deposed dictator of33 years, where workers have actively sought to organize independent tradeunions and whose leader languished in jail.

Ultimately, with the NED, Washington sets a double standard for itselfand everybody else. In 1997, congressional opponents of the Clintonadministration expressed outrage over foreign¡ªspecifically,Chinese¡ªinterference in U.S. elections, a story picked up and playedrepeatedly by the media. Eventually, the investigation was dropped for fearit would gore too many bulls on both sides of the aisle. But imagine if theChinese had gone further: openly funding congressional candidates,researching low-voter turnout and America's antiquated voter registrationsystem, infiltrating trade unions, sponsoring conferences in Washingtonsupporting groups critical of the U.S. government and actively promoting theefficacy of Chinese-style state-run enterprises. Imagine the NED.




Endnotes:

James Ciment is the author of the recently published Encyclopedia ofConflicts Since World War II (Armonk, N.Y.: M.E. Sharpe, 1999). ImmanuelNess is assistant professor of labor politics at Brooklyn College.
  1. Mike Feinsilber, "One Expert's Views on How Democracy Triumphed,"Associated Press, Feb. 13, 1990.
  2. Gershman, when executive director of the conservative SocialDemocrats-U.S.A, once praised Jonas Savimbi¡ªlongtime leader of theCIA-sponsored mercenary force in Angola¡ªas "one of the most impressivepolitical figures I have ever met." CovertAction Information Bulletin, No.7, Dec. 1979-Jan. 1980, p. 25.
  3. "$200 Million!: Sponging Up Grants for Democracy," Columbus Dispatch,Oct. 15, 1993, p. 8A.
  4. David Samuels, "At Play in the Fields of Oppression," Harper's, May 1995,p. 50.
  5. "Florida Libel Verdict Reversed; Ex-Diplomat Had Accused Exile Group ofMisuse of Funds," Washington Post, Feb. 4, 1999, p. A9.
  6. Barbara Conry, "The NED Is No Friend of the Taxpayer," Chicago Tribune,Dec. 13, 1993.
  7. David Ignatius, "Innocence Abroad: The New World of Spyless Coups,"Washington Post, Sept. 22, 1991. This view was reiterated by former CIAChief William Colby. Discussing NED programs, he opined, "it is notnecessary to turn to the covert approach. Many of the programs which...wereconducted as covert operations [can now be] conducted quite openly, andconsequentially, without controversy." "Political Action¡ªIn the Open,"Washington Post, Mar. 14, 1982, p. D8.
  8. William I. Robinson, Promoting Polyarchy: Globalization, U.S.Intervention, and Hegemony (New York: Cambridge University Press, 1996).
  9. Strobe Talbott, "Support for Democracy and the U.S. National Interest,"State Department Dispatch, Mar. 18, 1996, p. 121.
  10. Henry Kissinger, Years of Renewal (New York: Simon and Schuster, 1999).
  11. To be published by the Albuquerque-based Interhemispheric ResearchCouncil.
  12. Elizabeth Cohn, interview with authors, Mar. 19, 1999.
  13. In its most recent reported annual spending (for FY 1997), NED's fourcomponents made grants totaling $26.4 million out of a total budget of $31.6million. Annual Report, National Endowment for Democracy, 1997 (Washington,D.C.: NED, 1998).
  14. Michael Eisenscher, interview with authors, Mar. 21, 1999.
  15. Saul Landau, "U.S. Spends $30 Million a Year to Meddle in ForeignElections," Sacramento Bee, Apr. 19, 1997, p. B7.
U.S. Dollars to Serbian Opposition

U.S. funds have been flowing for several years to the Serbian opposition,both within Kosovo and throughout Yugoslavia, much of it from taxpayers.

According to the U.S. Institute of Peace in Washington (anorganization with a long record of anti-Serbia involvement), the Agency forInternational Development sent nearly $10 million to Yugoslavia in 1998through two programs, Support for East European Democracy and the Office ofTransition Initiatives. The U.S. Information Agency granted more than $1million that year, and the National Endowment for Democracy nearly amillion.

But by far the largest amount has been given to anti-governmentorganizations by the Fund for an Open Society-Yugoslavia, a branch of theSoros Foundation based in Belgrade, until recently in Pristina, and inMontenegro. In fiscal year 1998, it bestowed some $14.8 million in grantsfor a wide range of activities, mostly for "information," "arts andculture," "education," and "youth" programs.

It is likely that the 1999 figures are much greater, and the overalltotals are undoubtedly increasing exponentially every day.


  
 
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