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FTR #763 The Adventures of Eddie The Friendly Spook, Part 9: Citizen Greenwald’s Financial Angel

Dave Emory’s entire life­time of work is avail­able on a flash drive that can be obtained here. [1] (The flash drive includes the anti-fascist books avail­able on this site.)

Listen: MP3

Side 1 [2]  Side 2 [3]

Note: In an update, we learn that Greenwald’s Financial Angel–Pierre Omidyar–has helped to finance the coup [4] that led to the crisis in the Ukraine.

[5]

David Koch

Intro­duc­tion: This pro­gram high­lights the finan­cial angel behind the new media out­let being launched by “Eddie the Friendly Spook” Snowden’s leak­ing jour­nal­ist of choice, that res­olute cham­pion of human lib­erty Glenn “Give me a Nazi and I will defend him pro-bono” Green­wald [6].

The founder of EBay (which bought Pay­Pal from Peter Thiel), Pierre Omid­yar has been hailed as a ver­i­ta­ble saint by the media. In fact, he is a crea­ture in the mold of the Koch Broth­ers [7] and the Lud­wig von Mises Insti­tute [8].

In his auto­bi­og­ra­phy and polit­i­cal man­i­festo “Mein Kampf,” Hitler observe that: “Most peo­ple tell lit­tle lies. They would be ashamed to tell big ones. They would never credit oth­ers with such great impu­dence as the com­plete rever­sal of fact. . . .” That is the case with Omid­yar and the Olmid­yar Net­work that he oper­ates as a vehi­cle for using “busi­ness as a vehi­cle for good.”

Behind the facade of Omidyar’s pro­nounce­ments of good intent and the media’s lavish praise of him, one finds the Olmid­yar Network’s fund­ing of laissez-faire eco­nomic poli­cies that have resulted in lethal, bru­tal real­ity in the Third World.

Among the most grotesque of the projects funded by the Omid­yar Net­work are micro-finance pro­grams in Third World coun­tries such as India. Omid­yar Net­work funded Uni­tus, a micro­fi­nance equity fund that sup­ported SKS Microfinance.

SKS insti­tuted preda­tory lend­ing prac­tices that led to mass sui­cides among the pop­u­la­tion of Andhra Pradesh in India while gen­er­at­ing hand­some prof­its for Uni­tus. Other Omid­yar Network-backed micro­fi­nance enti­ties yielded sim­i­lar results.

In addi­tion to micro­fi­nance projects, the Omidyar-Network has invested in edu­ca­tion pri­va­ti­za­tion projects in both the U.S. and the Third World.

[9]

Matthew Hale, Glenn Greenwald's pro-bono client, convicted of solicitation of murder.

ON-backed education-privatization projects are asso­ci­ated with Tea Party-backed ele­ments and prop­ganda. ON-backed education-privatization pro­grams in Africa have exac­er­bated the poverty of those they pro­fessed to help.

Exemplifying the nature of the Omidyar Network’s efforts is Hernando de Soto. Dubbed “the Friedrich von Hayek” of Latin America, de Soto has been lauded by the Koch brothers and is a creature of the same stripe as Augusto Pinochet of Chile.

A backer of the Peruvian dictatorship of Alberto Fujimori (now in prison for crimes committed during his tenure as head of state), de Soto implemented many of the programs that brutalized and impoverished the citizenry of the country.

In addition, de Soto’s programs have resulted in catastrophe in countries such as Cambodia.

Concluding with some of Citizen Greenwald’s recent exploits, the program notes his appearance [10] on Ron Paul’s new internet tv project, as well as his keynote address [11] to a Los Angeles meeting of CAIR, a Muslim Brotherhood front organization.

Do note the won­der­ful arti­cle upon which this primarily broad­cast relies. It is avail­able at: https://www.nsfwcorp.com/ [12]

Program Highlights Include: Review of Peter Thiel’s bankrolling of Ron Paul’s candidacy; review of the profound links between “the Paulistinian Libertarian Organization” [8] and Snowden; links between the Omidyar Network’s education-privatization projects and the Pearson education giant (which is involved with joint projects with Bertelsmann); review of Friedrich von Hayek’s links to the Ludwig von Mises milieu; the Omidyar Network’s involvement with a program to influence members of India’s parliament in directions favorable to the ON’s projects; Hernando de Soto’s role as Peru’s “druz czar;” de Soto’s efforts on behalf of Fumori’s daughter’s candidacy; de Soto’s apparent role in the Fujimori coup in Peru; the handsome profit earned by ON-backed Unitus fund on the SKS project (which devastated those to whom it lent money); links between the ON-backed de Soto and the milieu of Chilean dictator Augusto Pinochet; Pierre Olmidyar’s lavish praise for Hernando de Soto, tweeted after dining with him.

1.  Most of the program consists of the reading of long excerpts of the NSFW Corp story on Omidyar.

“The Extra­or­di­nary Pierre Omid­yar” by Mark Ames and Yasha Levine; NSFW­Corp; 11/15/2013. [13]

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” [14], 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 [15]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 [16] 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 [17] 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 [18] 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 [19] stud­ies [20], 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 [21]. ON boosted SKS in its pro­mo­tional mate­ri­als [22] 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 [23], 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 [24].

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 [25]:

“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 [26] 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 [27] 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 [28] 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 [29] 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 [30] 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 [31], 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 [31] 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 Sidr ­affected 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 [32], 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 [29] 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 beenduped [33]. The movie pro­moted the myth that edu­ca­tion could only be saved by the likes of Tea Party-backed school “reform” advo­cate Michelle Rhee [34]. Teach­ers orga­nized a boy­cott [35] of DonorsChoose after the Omidyar-funded group announced it was essen­tially brib­ing its mem­bers with a $15 gift cer­tifi­cate [36] to any­one who bought tick­ets for “Wait­ing for Superman.”

Two years later, DonorsChoose part­nered and pro­moted [37] yet another right-wing teacher-bashing pro­pa­ganda film, “Won’t Back Down.” [38]

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 [39] about Pearson’s near-monopolistic power influ­enc­ing the pri­va­ti­za­tion of Amer­i­can edu­ca­tion (see Ravitch’s arti­cle“The Pear­son­iza­tion of the Amer­i­can Mind.” [40])

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 [41]. 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 mil­liongrant [42] 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 [42] 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” [43]—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 min­is­terJose Piñera [44], 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 [45]Mar­garet Thatcher’s go-to think tank [46]. 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 [47] 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 [48], 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 [49] the 1992 coup. De Soto denied involve­ment; but in 2011, two years after Fuji­mori was jailed forcrimes against human­ity [50], 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” [51] 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” [52] 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 [53] 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 [54] from their homes in more valu­able dis­tricts, relo­cat­ing them to the city outskirts.

An arti­cle in Slate titled “The De Soto Delu­sion” [55] 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 [56] 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 [57] “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.

2. Greenwald was Ron Paul’s first guest on the latter’s new internet television show.

“Ron Paul Launches New Inter­net Chan­nel” by Court­ney Coren; News­Max; 8/14/2013 [10]. [10]

Former Repub­li­can pres­i­den­tial can­di­date Ron Paul is back with a vengeance, using his new online TV chan­nel to attack the poli­cies of the Obama admin­is­tra­tion and any­thing else he sees as a chal­lenge to his lib­er­tar­ian views.

The for­mer Texas con­gress­man launched The Ron Paul Channel [58] Mon­day with an exclu­sive inter­view with Glenn Green­wald, one of two jour­nal­ists who first dis­closed the secret National Secu­rity Agency tele­phone and inter­net data col­lec­tion pro­gram, based on leaks from for­mer NSA con­trac­tor Edward Snowden. . . .

3. Citizen Greenwald also was selected by CAIR to give the keynote speech at their Los Angeles dinner. Misrepresented as a Muslim civil rights organization, the Council on American-Islamic Relations is a Muslim Brotherhood front group.

“Con­tro­ver­sial Jour­nal­ist to Keynote CAIR-LA Ban­quet” by gmb watch; Global Mus­lim Broth­er­hood Daily Watch; 11/4/2013. [11]

US media has reported that con­tro­ver­sial jour­nal­ist Glenn Green­wald will be the keynote speaker for a din­ner event put on this week by the  Los Ange­les chap­ter of the Coun­cil on American-Islamic Rela­tions (CAIR). . . .

. . . . CAIR was founded in 1994 by three offi­cers of the Islamic Asso­ci­a­tion of Pales­tine, part of the U.S. Hamas infra­struc­ture at that time.  Documents dis­cov­ered in the course of the the ter­ror­ism trial of the Holy Land Foun­da­tion con­firmed that the founders and cur­rent lead­ers of CAIR were part of the Pales­tine Com­mit­tee of the Mus­lim Broth­er­hood and that CAIR itself is part of the US. Mus­lim Brotherhood. . . .