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FTR #797 Cyber-Libertarian Fascism: Update on the Adventures of Eddie the Friendly Spook

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 that this description contains material not included in the original broadcast.

Introduction: Bringing up to date our massive For The Record series on “L’Affaire Snowden,” the program opens with discussion of the CV of Plato Cacheris, Snowden’s latest attorney [5]. Specializing in intelligence-related cases, Cacheris has been on the scene during past investigations of covert operations and domestic political destabilization efforts, having represented Nixon’s Attorney General John Mitchell during Watergate, Oliver North’s secretary Fawn Hall and Monica Lewinsky.


Next, we note that NSA critic and Snowden supporter Rand Paul enjoys the support [6] of Joe Lonsdale, a co-founder of Palantir [7] and an associate of Peter Thiel [8]. (The company’s disclaimers to the contrary notwithstanding, the available evidence suggests strongly that Palantir makes the PRISM software at the center of the brouhaha around Snowden.)

A long-standing fellow traveler of fascists, white-supremacists and neo-Confederates, Rand Paul is the Presidential candidate of choice of Ralph Nader [9], whose Green Party candidacy was instrumental in handing George W. Bush the Presidency in 2000 (with the pivotal assistance of the Supreme Court).  This as Jeb Bush, Dubya’s kid brother, is looking more and more like the Presidential candidate for GOP in 2000.

Basically, Nader is now a fellow-traveler of the Tea Party.

Reviewing information from FTR #264 [10], we note that Nader is a consummate hypocrite, investing [11]in the very companies he criticizes and manifesting a doctrinaire anti-union stance [12].

With Lewinsky attorney Plato Cacheris now representing Snowden, and Whitewater players Richard Leon [13] and Larry Klayman [14] also reappearing in L’Affaire Snowden [15], elements of the Bush destabilization team that helped install Dubya (with the help of Darth Nader) appear to be coalescing.

In past programs, we have noted that L’Affaire Snowden and WikiLeaks appear to be part of the same operation. Both Assange and Snowden have related “hacker nicknames/handles.” [16]


Peter Thiel

Of great significance is Assange’s endorsement of the need for unregulated financial markets [18], placing him in the company of the cyber-libertarian fascists.

[19]Snowden’s latest media interview, with NBC’s Brian Williams, was arranged by EBay billionaire Pierre Omidyar’s First Look Media [20]. Omidyar has been a financier of fascist causes and individuals, and has links with numerous agencies and institutions that serve as vehicles for U.S. covert operations.

Omidyar’s most recent arena of operation is India, where he aided [21] the successful candidacy of Narendra Modi [22], heir to the Hindu fascist tradition embodied in the RSS.

Underscoring in a dramatic way, our caveat: “Fear the tech companies, not the NSA, Facebook is introducing a new feature that will permit the company to turn on the microphones of their customers’ smart phones and listen in on them at any time!

Program Highlights Include:

1.  Snowden’s latest choice of lawyers is a veteran of espionage cases, and has appeared on the scene in connection with domestic covert operations.

“Snowden Lawyer: Famous for Espionage Clients . . . and Monica Lewinsky” by Colby Itkowitz; The Washington Post; 4/29/2014. [5]

Edward Snowden has retained a new attorney who is well-versed in the world of espionage, but Plato Cacheris is also well known for being a stealth legal navigator for those who find themselves suddenly notorious. In some instances, like Snowden, the two go hand-in-hand.

But a New York Times story published Tuesday morning about [33] Cacheris taking on Snowden’s case leaves out perhaps the lawyer’s most famous clients: Monica Lewinsky, President Bill Clinton’s mistress; and Fawn Hall, of the Iran-Contra scandal. Cacheris helped [34] Lewinsky receive immunity from prosecution, freeing her to testify about her sexual relationship with Clinton. He also got immunity for Hall, who was secretary to Oliver North, so she could speak freely. . . . .

. . . . The mega-lawyer has been the go-to defense lawyer for most D.C. scandals since representing Attorney General John Mitchell during the Watergate crisis. . . . .

2.  Palantir co-founder Joe Lonsdale is a backer or Rand Paul. He is also a close associate of Peter Thiel.

“Rand Paul: ‘I’m not Afraid of Tech­nol­ogy’”; CNN Money; 5/1/2014. [6]

 Sen. Rand Paul, the libertarian-leaning Ken­tucky Repub­li­can and likely pres­i­den­tial con­tender, sat down with Fortune’s Tory Newmyer in April after his lat­est swing through Sil­i­con Val­ley to talk about his efforts to build a base there. Edited excerpts:

What have you learned from your con­ver­sa­tions with entre­pre­neurs like Peter Thiel and oth­ers in Sil­i­con Valley?

Almost every­body I talk to out there from Peter on will say, “You know what? We think Sil­i­con Val­ley is a lit­tle more lib­er­tar­ian than it is Demo­c­rat, even though 80 to 90% of the money went to Pres­i­dent Obama.” And it’s been a deter­rent to some Repub­li­cans going out there. Many more of them are libertarian-leaning Repub­li­cans than they are Democ­rats, and they may not know it yet. But actu­ally most of them do know it. Frankly a lot of peo­ple who sup­ported Pres­i­dent Obama will say, “You know what? It turns out I am a lot more fis­cally con­ser­v­a­tive than Pres­i­dent Obama on taxes and reg­u­la­tion.” They’re not happy about either one of those. But they’re more mod­er­ate on social issues than the Repub­li­cans are.

You’ve got an appar­ent sup­porter in Joe Lons­dale. A com­pany he co-founded, Palan­tir, got startup fund­ing from the CIA ven­ture fund to enhance the sur­veil­lance agen­cies’ abil­ity to sort data. What would you say to civil lib­er­tar­i­ans who look at the capac­ity they’ve devel­oped and say it presents the poten­tial for problems?

I’m not afraid of tech­nol­ogy. So I’m not like some­body who’s afraid of the loom. I’m not afraid of the light bulb. I’m not afraid of things like that. I am con­scious of the fact the more tech­nol­ogy you have, it could be abused, but I’m not against spy­ing. I’m for spy­ing if it is done within the con­fines of the Fourth Amend­ment. Which means you have to name the per­son, name what you want, ask a judge, and present prob­a­ble cause. . . .

3. Shades of 2000–Darth Nader is stumping for Rand Paul.

“Ralph Nader Wants Liberals to Back Rand Paul. Don’t Do It” by Bill Scher; The Week; 5/1/2014. [9]

This week, Ralph Nader returned to the political stage with a new book, Unstoppable, whose triumphant subtitle is The Emerging Left-Right Allianceto Dismantle the Corporate State. To kick off his publicity tour, he has argued that liberals should “definitely” impeach President Barack Obama, abandon the “international militarist” Hillary Clinton, and instead embrace Sen. Rand Paul (R-Ky.) as a possible leader of his dream coalition. [35] . . .

4. Next, the program reviews Ralph Nader’s political hypocrisy, excerpting material from FTR #264 [10] (Recorded in January of 2001.)

The first part of the excerpt features an article about the hypocritical investment policy that Ralph Nader has executed. (“How Nader Profits While He Preaches” by Jeff McMahon; bushwatch.net/nader.htm; 10/27/2000.) [11]

In a pre-script to the McMahon article, Nader expressed his preference for George W. Bush over Al Gore (in a radio interview excerpted at the beginning of the article.)

. . . . Of more immediate interest, at least to Al Gore, are Nader’s respectable poll numbers: 7 to 10 percent in California as of June, 6 percent nationally. If California tips Green enough, Bush could win the state and the whole damn election. Which, Nader confided to Outside in June, wouldn’t be so bad. When asked if someone put a gun to his head and told him to vote for either Gore or Bush, which he would choose, Nader answered without hesitation: “Bush.” Not that he actually thinks the man he calls “Bush Inc.” deserves to be elected: “He’ll do whatever industry wants done.” The rumpled crusader clearly prefers to sink his righteous teeth into Al Gore, however: “He’s totally betrayed his 1992 book,” Nader says. “It’s all rhetoric.” Gore “groveled openly” to automakers, charges Nader, who concludes with the sotto voce realpolitik of a ward heeler: “If you want the parties to diverge from one another, have Bush win.”

Nader owns up to $250,000 worth of shares of Fidelity Magellan Fund, a firm that is heavily invested in many of the corporations that Nader has been most vocal in criticizing.

Among those firms that Fidelity invests in are Halliburton oil, headed by Dick Cheney up until recently. Fidelity also invests in Occidental Petroleum, a firm that has been criticized by environmentalists. Al Gore’s mother’s trust owns a significant block of Occidental stock. Gore’s populist credentials have been impugned Nader Vice-Presidential candidate Winona La Duke because of that stock.

We also highlight disturbing aspects of Nader’s anti-labor activities, and his avoidance of social issues. (“1.75 Cheers for Ralph” by Doug Henwood; Left Business Observer; 10/1996 [#74].) [12]

5.  Interestingly and significantly, Snowden and Julian Assange use similar online pseudonyms.

This Machine Kills Secrets: Julian Assange, the Cypherpunks and Their Fight to Empower Whistleblowers by Andy Greenberg; Google Books. [16]

. . . . After initially communicating with reporters under the pseudonym “Verax”–the Latin antonym of Assange’s Mendax–Snowden chose to reveal his real name . . .

6a. While not at all sur­pris­ing at this point [36], it’s worth not­ing that Julian Assange just gave an inter­view where he hails the virtues of Bit­coin and unreg­u­lated finan­cial mar­kets in gen­eral [18]:
Julian Assange: Bit­coin Could Estab­lish a New Global Con­sen­sus [Net Prophet] by Michelle Ata­gana; meme­burn; 5/21/2014. [18]

“Bit­coin is the most intel­lec­tu­ally inter­est­ing devel­op­ment in the last two years,” said Julian Assange via a WeChat Livestream at Net Prophet [37]— the annual tech­nol­ogy and trends con­fer­ence. Accord­ing to the Wik­ileaks founder, the next great inno­va­tion that is headed our way will be in the finance sector.

He reck­ons that the tech­no­log­i­cal inno­va­tion behind Bit­coin is estab­lish­ing a new global consensus.

Usu­ally, we need laws to estab­lish and enforce the way finan­cial trans­ac­tions take place, but Bit­coin is chang­ing that. Cryp­to­graph­i­cally enforced agree­ments, like the ones com­ing out of Bit­coin, are dif­fer­ent from the norm in as much as the code behind them enforces how trans­ac­tions are done.

Assange, who is still being granted asy­lum at the Ecuado­rian embassy in Lon­don, sus­pects that in the next few years we’ll see a level of inno­va­tion in finan­cial ser­vices that far out­strips those of the past. The way he sees it, the cur­rent tra­di­tional model of the finance indus­try isn’t work­ing and Bit­coin is dis­rupt­ing it in a good way.

Respond­ing to a ques­tion on the rise of one dom­i­nant player in some aspects of the inter­net (think Google with search), the weather-worn whistle­blower reck­ons the age of sin­gle dom­i­nance is problematic.

“I think that is a seri­ous ques­tion — whether most things that most peo­ple use most of the time will be eaten up by a few dom­i­nant play­ers,” said Assange, who again turned to the exam­ple of Bit­coin to illus­trate his point.

You can quickly form a full finan­cial sys­tem with hedge funds and other such finan­cial ser­vices where there is no reg­u­la­tion, where the reg­u­la­tion is a cryp­to­graphic agree­ment, he points out. The ben­e­fit of such a sys­tem is that peo­ple have to be part of this agree­ment in order to talk to each other.

Another ben­e­fit is that there is no reg­u­la­tion, because it is all done through com­pu­ta­tion. Finan­cial ser­vices run­ning over the top of cryp­to­graphic pro­to­cols such as Bit­coin there­fore tend to evolve and inno­vate incred­i­bly quickly.

Assange reck­ons that when it comes dis­cussing inno­va­tion within the finance indus­try, we must under­stand that what we are talk­ing about is the inter­ac­tion of finance. He explains this con­cept as “the abstrac­tion of relationships”.

“What we are talk­ing about is the inter­ac­tion of finance: the abstrac­tion of rela­tion­ships between organ­i­sa­tions and indi­vid­u­als and the quan­tifi­ca­tions of those relationships.”

For the renowned hacker, cryp­to­graphic agree­ments involve the need to agree. In turn, he says, we are talk­ing about a way of cre­at­ing new orders and new soci­etal agree­ments that include all of soci­ety, not just new orders that only apply to those who chose to come in and agree to a par­tic­u­lar aspect or cryptographic.

Assange argues that cur­rent struc­tures around finance from polit­i­cal and eco­nomic points of view mean that the peo­ple in con­trol can often get pushed around by the state. This is why Bit­coin is impor­tant, he says, as it brings about diver­sity, which is needed in any organization. . . .

6b. Assange is a bird of the same feather as Ralph Nader, Snowden, Rand Paul and his father Ron Paul.

“Assange’s Emerging Politics: Rand Paul and Ron Paul and Libertarian Wing of GOP Represent ‘Only Hope’ by Tom Watson; Forbes; 8/17/2013. [24]

The strong turn of Julian Assange [38] and Wikileaks toward partisan electoral politics continued this weekend, as Assange told an online audience that he’s “a big admirer of Ron Paul and Rand Paul for their very principled positions in the U.S. Congress on a number of issues” and insisted that the libertarian wing the Republican Party represented the “only hope” for reform in American politics.

The praise for the conservative Paul wing of the Republican Party in the U.S., aligned with Tea Party and anti-government activists, comes on the heels of the establishment of the Wikileaks Party in Australia, where Assange is standing for election [39] to the Senate from Victoria. . . . .

7. In the long FTR series on L’Affaire Snowden,  we noted that all of the players were outright fascists and/or exponents of corporatist economic theory. That includes Pierre Omidyar [25], Nazi fellow-traveler Glenn Greenwald’s [26] financial angel and backer of First Look media.  Touting the laissez-faire economics of the GOP and other corporatist elements around the world, Omidyar has also helped to finance the rise of fascist elements abroad, including assisting in the ascent [27] of the OUN/B successor forces in the Ukraine, as well as Narendra [21] Modi, heir to the RSS Hindu fascists that spawned his BJP.

Omidyar’s “philanthropy” is cast in the laissez-faire economics to which he is wed. Building on the lethal record of his SKS microfinance project in Andhra Pradesh state in India, Omidyar Networks has utilized the Rural Development Institute, the child of Roy Prosterman, a counterinsurgency veteran of the Phoenix Program in Vietnam and similar projects in places like El Salvador.

Omidyar and his then-CEO Meg Whitman (of EBAy) also were  under investigation: “. . . .  in return for giving Goldman Sachs the lucrative eBay IPO, the “vampire squid” [40] bank set up private secret accounts for Omidyar and CEO Meg Whitman letting them spin dozens of tech IPOs before they went to market — ripping off both retail investors and startup investors. Omidyar settled a shareholder fraud lawsuit [30] in 2005 without admitting wrongdoing, ironic for a visionary who believes so deeply in accountability.

Omidyar and other EBay executives are currently being investigated for another alleged scam: “Omidyar was subpoenaed [41] by a federal grand jury [29] criminal investigation [42] into his and other eBay executives’ alleged roles in stealing Craigslist’s “secret sauce” [43] for eBay’s profit.”

What a swell guy Omidyar is. Read the article below for details on his (and other corporatists’) vision for the mutating of micro-finance into a profit-making vehicle, often at the lethal expense of the poor who are supposed to benefit from those programs.

“EBay Shrugged: Pierre Omidyar Believes there Should Be No Philanthropy Without Profit” by Mark Ames; Pando Daily; 5/31/2014. [20]

This week, India’s newly-elected ultranationalist leader Narendra Modi unveiled his cabinet, three-quarters of whom come from a fascist paramilitary outfit, the RSS (Rashtriya Swayamsevak Sangh) [22] — including one minister accused by police last year of inciting deadly Hindu-Muslim violence that left over 50 dead.

The RSS was founded in 1925 by open admirers of Mussolini and Hitler; in 1948, an RSS member assassinated pacifist Mahatma Gandhi. In 1992, it was the RSS that organized the destruction of the Ayodha Mosque, leaving 2000 dead, mostly Muslims; and in 2002, the RSS played a key role in the mass-murders of minority Muslims in Gujarat, according to Human Rights Watch, when the state of Gujarat was ruled by Narendra Modi — himself a product of the RSS.

Earlier this week, Pando reported that Modi’s election received help from unlikely sources in Silicon Valley including Google, and to a much more serious extent, Omidyar Network, the philanthropy fund of eBay billionaire and First Look publisher Pierre Omidyar.

From 2009 through February of this year, Omidyar Network India Advisers was headed by Jayant Sinha, a longtime Modi adviser and newly-elected MP in Modi’s ultranationalist BJP party ticket. The Omidyar Network partner and managing director played a double role, investing funds in Indian nonprofits and for-profits, some with distinctly political agendas; while privately, the Omidyar man “worked in Modi’s team” in 2012-13, and served as director in the ultranationalist BJP party’s main think tank on security and economic policy, the India Foundation. This week, Modi appointed the head of the India Foundation, former intelligence chief Ajit Doval, as his National Security Advisor.

Modi was the “hi-tech populist” candidate: London techies managed Modi’s 3-D hologram campaign, beaming 10-feet-tall Modi holograms to rallies across India. And India’s techies played a key role both in campaigning for Modi and voting for Modi.

Despite the sunny progressive Silicon Valley gloss we’ve been fed these past few decades, Modi’s appeal shows that the tech industry is as prone to far-right authoritarian politics as any other industry.

And that is what makes the Omidyar Network story so revealing: Perhaps no other figure embodies the disconnect between his progressive anti-state image, and his factual collaboration with the American national security state and the global neoliberal agenda, than Pierre Omidyar.

The role of Omidyar Network in so many major events of the past week — helping elect India’s ultranationalist leader Narendra Modi; co-funding Ukraine regime-change NGOs with USAID, resulting in a deadly civil war and Monday’s election of Ukrainian billionaire oligarch Petro Poroshenko; and now, this week’s first-ever sit-down TV interview with Edward Snowden, through an arrangement between NBC News and Pierre Omidyar’s First Look Media — shows how these contradictions are coming to the fore, and shaping our world.

Omidyar’s central role in the US national security state’s global agenda may still come as a shock to outsiders and fans of First Look media’s roster of once-independent journalists. But to White House foreign policy hawks, Pierre Omidyar represents the new face of an old imperial tradition. . . .

. . . . . By taking a closer look at Omidyar Network’s investments in India, we gain insight into where the common interests between Big Tech, the US national security state, and neoliberalism align — and Omidyar’s strategic thinking aligning eBay/PayPal with Omidyar Network and First Look media.

Let’s start with Omidyar Network’s investments in the Rural Development Institute, founded by one of the godfathers of American counterinsurgency strategy: Roy Prosterman.

“Property Rights”: Omidyar and “Phoenix Program” guru Roy Prosterman

Omidyar Network identifies “property rights” (or “property titling”) as one of its five areas of focus. One of Omidyar’s personal heroes and largest grant recipients is neoliberal economist Hernando de Soto, the former right-hand man to jailed dictator Alberto Fujimori. De Soto is the world’s leading peddler of “property titling” as the answer to global poverty: rather than giving aid, De Soto says we should give the world’s poor private property titles, which slum dwellers can presumably collateralize into microloans for their slum-based startups. The results have often been catastrophic — but that hasn’t stopped De Soto from being admired by the world’s ruling elite, ranging from Bill Clinton, to the Koch brothers — to Pierre Omidyar, who gave $5 million to De Soto’s neoliberal think tank . . .

. . . .India, like many developing countries around the world, has what Anglo-Americans consider a weak legal structure on property rights. In particular, local indigenous peoples lay ancient claims to lands they live on, and have resisted state attempts to forcibly evict them to make way for industry, mining, and other powerful interests. The Naxal Maoist insurgencies raging in parts of India are fueled in part by displaced, landless peoples. Since Modi’s election landslide, global investors have been hopeful that India’s land will now be made easier to buy and sell. Omidyar Network’s longtime top man in India, Jayant Sinha—now an MP in Modi’s far-right ruling party — told CNBC that Modi’s first job should be making land acquisition easier:

We have to start with land acquisition. We have to make land acquisition a lot better in terms of both the people that are acquiring the land from the farmer’s and so on as well as for industry.

So perhaps it’s little surprise that Omidyar’s first major India grant, in 2008, went to the Rural Development Institute’s (renamed “Landesa”) program “to help secure land rights for the rural poor” in India’s Andhra Pradesh state. By 2009, Omidyar Network had committed $9 million to the RDI land rights program, the largest grant in the outfit’s history.

And what a history: The Rural Development Institute was founded in 1967 by Roy Prosterman, whose land reform programs were a key element in the Vietnam War counterinsurgency strategy, the “Phoenix” assassination program. The Phoenix program became the template for modern American counterinsurgency — violent terror, combined with soft-power land “reforms” cooked up by Prosterman’s Institute.

During the Vietnam War, Prosterman teamed up with USAID to implement his “land-to-the-tillers” reforms, granting land to peasants as the carrot, while at the same time CIA death squads assassinated tens of thousands of Vietnamese village leaders and terrorized restive regions into submission. The result, Prosterman later boasted, was that Viet Cong recruitment dropped 80 percent.

A decade later, Prosterman sold the same land reform program to El Salvador’s junta, just as the junta was ramping up its deadly attacks on rural civilians that left 75,000 killed by US-backed government forces. Prosterman also served as “land reform” advisor to Philippines dictator Ferdinand Marcos. And in the 1990s, Prosterman was contracted by Booz Allen to advise land reforms in Moldova, according to journalist Tim Shorrock. . . .

. . . . . A few years ago, Prosterman’s Rural Development Institute changed its name to Landesa. But Prosterman’s Cold War outfit hasn’t changed its close cooperation with USAID, or its core strategic mission, tying land ownership to security (and counterinsurgency) — neatly summed by Landesa’s India director’s article: “Connecting the Dots Between Security and Land Rights in India.”

Leaving aside the alleged benefits to India’s poor of giving them land title to the commons — 400,000,000 Indians live on less than $1.25 a day — for the more powerful interests funding land titling programs, there are endless advantages. It helps create a mass tax base for governments that want to shift more taxes onto the masses; it formalizes and legalizes transfer of property from the commons to the strongest and richest; it makes foreign investors happy; it helps the government and businesses track and keep data on its citizens; and, to quote Omidyar Network managing partner Matt Bannick — recently appointed by the Obama White House to a special task force — Prosterman’s land reforms made Omidyar “excited about how micro-land ownership can empower women and help them to pull themselves out of poverty.”

That’s because micro-land ownership helps create the real focus of Omidyar Network investments in India: Microfinance.

“Financial Inclusion”: Omidyar, Microfinance & Suicide-By-Pesticide

Omidyar Network’s ugliest disaster — besides co-funding Ukraine regime-change groups with USAID — was its role in funding SKS Microfinance, whose predatory lending and debt collecting practices led to a rash of gruesome suicides in rural Andhra Pradesh.

First, a quick word on the theory and practice of microlending. In theory, the original microfinance concept — a nonprofit extending micro-loans to the poor, under favorable terms, below market rates — could be beneficial, and under the right circumstances, it often was. But to the neoliberals, the original microfinance concept smacked of do-gooder state socialism — so microfinance floundered in the margins of the development community until 1992. That year, USAID commercialized a Bolivian microfinance nonprofit called Prodem, creating a new for-profit micro-lender, BancoSol in its place. BancoSol ballooned overnight — both in loans and in profits, making millionaires of the former nonprofit directors before BancoSol nearly collapsed at the end of the decade.

USAID liked the for-profit neoliberal model for microfinance, and it persuaded the World Bank and other global financial institutions to load in and sing its praises. That brought microfinance to the attention of Wall Street funds, eventually pushing out “old” “unsustainable” nonprofit microfinance institutions, and seducing the likes of Nobel Peace Prize winner and microfinance industry guru Muhammad Yunus into the for-profit sector as well. As we now know, it ended in disaster — particularly in India’s Andhra Pradesh state, where Omidyar-funded land title programs had been busy creating legions of rural poor “micro-land owners” now ready to load up on Omidyar-funded microfinance loans. The result would be scores of women driven to grisly suicides, forced prostitution, and despair.

It’s hard to overstate just how central the for-profit microfinance model is to Pierre Omidyar’s “vision.” In a 2006 New Yorker article detailing Omidyar’s near-religious zeal for commercializing microfinance, we learn that the eBay billionaire not only rejected the Nobel Peace Prize winner’s appeals to soften his monomaniac focus on profiting off the world’s poor — we also learn that Omidyar was committed to wiping out whatever remained of charitable non-profit microlending, so as not to “distort the market.” Omidyar rejected on principle entreaties from his fellow billionaires to invest in a nonprofit microfinance fund. Because on principle, Omidyar refused to believe that good could come from anything but the self-interested profit motive. Here’s the New Yorker:

[Omidyar] often cites Adam Smith’s doctrine that unrestrained market forces and self-interest drive the most efficient—and socially beneficial—use of resources. Omidyar sees Smith’s principles at work in eBay; he believes that eBay’s commercial success was linked to a profound social good.

Omidyar’s faith in the eBay model is so great that he is convinced that it can be applied to solving humanity’s problems, including poverty — and that is why Omidyar singled out for-profit microfinance as his life’s mission. After rejecting Yunus as an “old thinker” wedded to old do-gooderism non-profit thinking, Omidyar announced a $100 million donation to Tufts University, the largest in school history, with the stipulation that the Omidyar-Tufts Microfinance Fund went “specifically” into “investments that would promote microfinance’s commercialization.”

To manage the fund, Omidyar hired a Senior Credit Officer from USAID — the agency that originally commercialized microfinance in 1992 — who channeled Joseph Schumpeter to the New Yorker:

“One of the things we need and we will get is a cycle of creative destruction,” said Tryfan Evans, the director of investments at the Omidyar-Tufts fund, who previously worked at U.S.A.I.D. “If you’re inefficient, you will get overtaken by competitors.”

What is rather shocking in hindsight is how fanatical Omidyar’s faith is in the free market, to the point that he’s willing to risk exploiting the most vulnerable poor on earth to prove that Adam Smith is right. The dangers of for-profit microfinance lending to India’s poor were no secret: the New Yorker article references a string of microfinance related suicides in Andhra Pradesh back in 2006, before Omidyar’s millions poured oil on that fire. . . .

. . . . And so Omidyar tested his theory: plowing millions into India’s SKS Microfinance via  investments into murky microfinance outfit Unitus. In 2010, SKS Microfinance listed a $350 million IPO [44] that netted insiders and early investors like Unitus obscene profits. The murky, interlocking nonprofit/for-profit [45] structures ensured that only those on the inside knew whether Omidyar made money on his investment.

The only sure thing was that the explosion of microfinance lending in the state of Andrah Pradesh, led by SKS Microfinance, wound up saddling the world’s poorest and most vulnerable village women with debts they could not pay, causing a wave of suicides. An AP investigation [46] directly implicated Omidyar-funded SKS Microfinance agents in several suicides:

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.”

In all these cases, the report commissioned by SKS concluded that the company’s staff was either directly or indirectly responsible.

After the report, Omidyar Network scrubbed SKS Microfinance from its website. An old cached webpage [47] shows Omidyar hailing SKS Microfinance for “serving the rural poor in India” and claiming that the murky Unitus private equity fund’s IPO “exit strategy” will “attract more capital to the market.”

Instead, Unitus dissolved its microfinance NGO, a wave of resignations and murky millions moved hands, SKS Microfinance became a pariah, and Andhra Pradesh passed laws regulating microfinance institutions. A tiny handful of insiders and investors pocketed obscene millions, over 200 killed themselves, and entire Indian rural communities were devastated. Self-interest and profit motive did not create the greatest social good that Omidyar believed in; and yet, Omidyar Network continues to expand its portfolio [48] of microfinance — or “financial inclusion” — investments.

eBay Shrugged

 “Omidyar stopped talking about microfinance as a way to end world poverty, and instead described its mission in a way congruent with the eBay experience.” —New Yorker

The key to understanding the enigmatic eBay billionaire and his many contradictions — an active participant in Washington’s global empire on a scale unrivaled in publishing, while also founder of a quarter-billion dollar “adversarial journalism” startup and privatizer of the Snowden NSA files, the largest cache of leaked national security secrets in US history — is understanding Omidyar’s eBay-centric vision.

Omidyar is a vision man [49], as his star employee Jeremy Scahill [50] constantly reminds us. And his vision was shaped, for understandable reasons, by his experience making ten billion dollars overnight off of eBay, which Omidyar believes is proof of a larger philosophical and moral structure at work, rather than a combination of smarts, luck, privilege… and other less savory factors.

In 2000, Omidyar confided to his New York Times biographer, Adam Cohen, that he founded eBay to create a “perfect market” after feeling cheated by the way tech IPOs in the early 1990s let insiders “spin” IPOs for a quick profits before dumping them onto the market to regular investors — like the pre-eBay Omidyar. Cohen writes [51]:

When 3DO announced plans to go public in May 1993, Omidyar placed an order for stock through his Charles Schwab brokerage account…. 3DO went public at $15 a share, but when Omidyar checked his account, he learned that the stock had soared 50 percent before his order had been filled…. it struck him that this was not how a free market was supposed to operate—favored buyers paying one price, and ordinary people getting the same stock moments later at a sizeable markup.

Omidyar’s solution was an online auction.

Cohen, a member of the New York Times editorial board, found Omidyar’s story convincing. There was only one problem: At the very time Omidyar spun this yarn to Cohen, Omidyar was under investigation [52] in the largest IPO stock spinning scandal in history. According to a House investigation, in return for giving Goldman Sachs the lucrative eBay IPO, the “vampire squid” [40] bank set up private secret accounts for Omidyar and CEO Meg Whitman letting them spin dozens of tech IPOs before they went to market — ripping off both retail investors and startup investors. Omidyar settled a shareholder fraud lawsuit [30] in 2005 without admitting wrongdoing, ironic for a visionary who believes so deeply in accountability.

More recently, Omidyar was subpoenaed [41] by a federal grand jury [29] criminal investigation [42] into his and other eBay executives’ alleged roles in stealing Craigslist’s “secret sauce” [43] for eBay’s profit. . . .

8. Omidyar’s “overt covert operation” participation in India has paid off, with his successful candidate of choice Narendra Modi opening up that huge county to e-commerce. That figures to benefit Omidyar enormously.

“Just as We Pre­dicted, India’s New Leader Is about to Make Pierre Omid­yar a Lot Richer” by Mark Ames; [31]Pando Daily; 6/4/2014. [31]

Well that was fast. Two weeks ago, we reported [21] that eBay founder Pierre Omidyar’s top man in India [53] had secretly [54] helped elect [55] con­tro­ver­sial ultra­na­tion­al­ist [56] Naren­dra Modi, impli­cated by Human Rights Watch [57] and oth­ers in the grue­some mass killings [58] and cleans­ing of minor­ity Mus­lims. As we also revealed, shortly after Omidyar’s man pub­licly joined the Modi cam­paign in Feb­ru­ary, Modi sud­denly began warming up [59] to the idea of let­ting global e-commerce com­pa­nies into the world’s third largest econ­omy. Omidyar’s eBay, which draws the major­ity [60]of its rev­enues from over­seas oper­a­tions, has been champ­ing at the bit [61] to get into India.

Now, just weeks after Modi’s elec­tion, it seems their prayers have been answered.

Today, Reuters [62] is report­ing that Modi is plan­ning to open India up to global e-commerce firms like eBay next month, and that Modi’s indus­try min­is­ter has been draw­ing up the new guide­lines with input from top eBay offi­cials, along with their e-commerce coun­ter­parts from Google, Ama­zon, Wal-Mart and others.

Call­ing the move to allow for­eign e-commerce into India “one of the first tan­gi­ble signs of eco­nomic reform by the business-friendly gov­ern­ment of Prime Min­is­ter Naren­dra Modi,” Reuters reports [62] that the sec­tor is expected to quadru­ple its share of the over­all econ­omy by 2020. India’s e-commerce indus­try is grow­ing at 40–50% annu­ally [63]. Those num­bers, and Modi’s accom­mo­dat­ing behav­ior, is mak­ing Pierre Omidyar’s under­lings salivate:

“Deepa Thomas, spokes­woman for eBay in India, said it was excited about the oppor­tu­nity and believed in the need for a care­fully cal­i­brated approach to open­ing up the sector.

“The indus­try min­istry that drafts FDI rules recently met offi­cials from com­pa­nies includ­ing Ama­zon, Google, eBay Inc, Wal-Mart and Indian e-tailer Flip­kart to finalise the invest­ment guide­lines, the peo­ple said.

“Global online retail­ers like Ama­zon and eBay are cur­rently banned from sell­ing prod­ucts they have sourced them­selves, and must rely on third-party sup­pli­ers. Their plat­forms, which they own fully, are mar­ket­places for these out­side suppliers.

“The gov­ern­ment is likely to end this ban, paving the way for global retail­ers to bring their for­mi­da­ble sup­ply chain, and cheaper goods, into India, poten­tially boost­ing con­sump­tion and ben­e­fit­ing small man­u­fac­tur­ers and traders.”

As we reported, the long­time man­ag­ing director [64] and part­ner for Omid­yar Net­work India Advi­sors, Jayant Sinha [65], began work­ing to help elect Modi since at least 2012 [54], while pub­licly dol­ing out tens of mil­lions [66]of Omidyar’s money to for-profits and to non-profits, at least one of which was involved in an anti-corruption campaign [67] cam­paign that undermined [68] the center-left rul­ing gov­ern­ment, and ben­e­fited [68] Modi’s far-right BJP party.

Omidyar’s top India man also con­cur­rently served as a director in a pow­er­ful BJP think tank, the India Foun­da­tion, chaired by Modi’s hard­line National Secu­rity Advi­sor, Ajit Doval [69]— accord­ing to the Hin­dus­tan Times. After step­ping down from Omid­yar Net­work in Feb­ru­ary of this year, Sinha worked full-time for Modi, the India Foun­da­tion, and for his own suc­cess­ful run as a BJP can­di­date [70] for par­lia­ment.

Another NGO that Omid­yar invested in, the Insti­tute for Pol­icy Research Stud­ies [71] (IPRS), was accused of ille­gally try­ing to lobby India’s par­lia­men­tar­i­ans to vote for open­ing up India’s e-commerce mar­ket in late 2012. The IPRS non­profit ran a pro­gram in which their staffers pro­vided India MP staffers with “non­par­ti­san” research. In 2012, India’s intel­li­gence bureau accused the IPRS of ““com­pro­mis­ing national secu­rity” [72]” and described it as “shrouded in mystery.”

Omid­yar Net­work had pledged $1 mil­lion to the IPRS, and the Ford Foun­da­tion pledged half a mil­lion more — but the Indian gov­ern­ment rejected [71] the IPRS’s appli­ca­tion to reg­is­ter as a foreign-funded NGO, deem­ing it a threat [72] to India’s par­lia­men­tary integrity, and its national secu­rity. Google’s cor­po­rate phil­an­thropic arm, Google.org, had pre­vi­ously given $880,000 [73]to the same NGO pro­gram, under Sheryl Sandberg’s watch.

The co-founder of this con­tro­ver­sial never-registered NGO, CV Mud­hakar [74], is now, you might not be shocked to learn, Omid­yar Net­work India’s direc­tor of  [75]investments in “gov­ern­ment trans­parency.”
. . . .

9. One of the major points of our Eddie the Friendly Spook series was the emphatic thesis that people should fear the tech companies, NOT the NSA. The NSA is a military agency and its members are NOT going to move up to GS-12 or whatever by finding out who’s farting in their cubicle at work. They are NOT interested in the turgid details of the insignificant lives of the average citizen.

The tech companies, on the other hand, ARE interested in EVERYTHING concerning EVERYONE–it is (arguably) their most important capital asset, behind their patented software.

Facebook now has a feature that will enable them to turn on the microphone of users’ cell phones at any time and listen in on their customers and everyone around them!

Be aware that Facebook “optional” features have to be “opted” out of, something many of Facebook’s users (particularly teen and pre-teen customers, of whom there are MANY) might not be aware of.

Pterrafractyl notes: “In addi­tion to being a creepy reminder of the creep­ing sur­veil­lance capac­ity that tech­nol­ogy inher­ently facil­i­tates, part of what’s going to make the roll out of this kind of tech­nol­ogy inter­est­ing to watch is that the sound match­ing algo­rithms are prob­a­bly going to have to yield “fuzzy” matches, at best, since the appli­ca­tion is designed to run pas­sively in a noisy envi­ron­ment with lots of ran­dom noises and con­ver­sa­tions over­lay­ing the music or tv shows play­ing in the back­ground. And with mul­ti­ple sea­sons for 160 tele­vi­sion sta­tions get­ting stored as the audio data­base, users’ every­day ran­dom con­ver­sa­tions that might get picked up by the app are going to be matched against a pretty mas­sive data­base of con­ver­sa­tional audio con­tent. It raises the ques­tion of whether or not that data­base is going to be small enough to store on indi­vid­ual phones and tablets or if it’s going to be send­ing all that hashed audio con­tent back to Face­book in real-time where it gets matched. This was this state­ment from Facebook:

“We’re not record­ing audio or sound and send­ing it to Face­book or its servers…We turn the audio it hears into a code — code that is not reversible into audio — and then we match it against a data­base of code.”

That sure sounds like the plan is for the audio con­tent to get “coded” [76]on the phone and sent to Face­book for real-time analy­sis. That’s ser­vice! A creepy ser­vice, but service!

So how often will peo­ple get “false pos­i­tives” where they’re inad­ver­tently cre­at­ing a “close enough” hit to a seg­ment of some ran­dom TV show? It seems like it might hap­pen every once in a while and it raises the pos­si­bil­ity of a rather neat new type of sur­vey: if users click a lit­tle “this isn’t what I was lis­ten­ing to or watch­ing” but­ton every time the app makes a “match­ing” mis­take it could be a method of sam­pling the extent to which life imi­tates art in every­day con­ver­sa­tions a whole new way. Kinda neat, eh?

That said, we really don’t need fancy new ways of sur­veilling every last bit of our lives in order to mea­sure how life is imi­tat­ing art these days. Direct obser­va­tion is enough [77].”

Never lose sight of the fact that Peter Thiel is the largest stockholder in Facebook, as well as Palantir that, their disclaimers notwithstanding, almost certainly makes the PRISM software.

“Face­book Wants To Lis­ten In On What You’re Doing” by Kash­mir Hill; Forbes; 5/22/2014. [78]

Face­book had two big announce­ments this week that show the company’s wildly diver­gent takes on the nature of pri­vacy. One announce­ment [79]is that the com­pany is encour­ag­ing new users [80] to ini­tially share only with their “friends” rather than with the gen­eral pub­lic, the pre­vi­ous default. And for exist­ing users, the com­pany plans to break out the old “pri­vacy dinosaur [81]” to do a “ check-up” to remind peo­ple of how they’re shar­ing. Face­book employ­ees say that using an extinct crea­ture as a sym­bol for pri­vacy isn’t sub­tle mes­sag­ing, but sim­ply an icon to which their users respond wellMean­while, Facebook’s sec­ond announce­ment indi­cated just how com­fort­able they think their users are in shar­ing every lit­tle thing hap­pen­ing in their lives. Face­book is rolling out a new fea­ture [82] for its smart­phone app that can turn on users’ micro­phones and lis­ten to what’s hap­pen­ing around them to iden­tify songs play­ing or tele­vi­sion being watched. The pay-off for users in allow­ing Face­book to eaves­drop is that the social giant will be able to add a lit­tle tag to their sta­tus update that says they’re watch­ing an episode of Games of Thrones as they sound off on their hap­pi­ness (or despair) about the rise in back­ground sex on TV these days.

The fea­ture is an optional one, some­thing the com­pany empha­sizes in its announce­ment [82]. The tech giant does seem well-aware that in these days of Snow­den sur­veil­lance rev­e­la­tions, peo­ple might not be too keen for Face­book to take con­trol of their smartphone’s mic and start lis­ten­ing in on them by default. It’s only rolling out the fea­ture in the U.S. and a prod­uct PR per­son empha­sized repeat­edly that no record­ing is being stored, only “code.” [NSA only harvests metadata–D.E.] “We’re not record­ing audio or sound and send­ing it to Face­book or its servers,” says Face­book spokesper­son Momo Zhou. “We turn the audio it hears into a code — code that is not reversible into audio — and then we match it against a data­base of code.”

If a Face­booker opts in, the fea­ture is only acti­vated when he or she is com­pos­ing an update. When the smartphone’s lis­ten­ing in — some­thing it can only do through the iOS and Android apps, not through Face­book on a browser — tiny blue bars will appear to announce the mic has been acti­vated. Face­book says the micro­phone will not oth­er­wise be col­lect­ing data. When it’s lis­ten­ing, it tells you it is “match­ing,” rather than how I might put it, “eaves­drop­ping on your enter­tain­ment of choice.”

It reminds me of GPS-tagging an update, but with cul­tural con­text rather than loca­tion deets. While you decide whether to add the match to a given Face­book update, Face­book gets infor­ma­tion about what you were lis­ten­ing to or watch­ing regard­less, though it won’t be asso­ci­ated with your pro­file. “If you don’t choose to post and the fea­ture detects a match, we don’t store match infor­ma­tion except in an anonymized form that is not asso­ci­ated with you,” says Zhou. Depend­ing on how many peo­ple turn the fea­ture on, it will be a nice store of infor­ma­tion about what Face­book users are watch­ing and lis­ten­ing to, even in anonymized form.

Sure, we’re used to fea­tures like this thanks to exist­ing apps that will rec­og­nize a song for us. But usu­ally when you acti­vate those apps, you’re explic­itly doing so to find out the name of a song. Face­book is hop­ing to make that process a back­ground activ­ity to com­pos­ing a sta­tus update — a fric­tion­less share that just hap­pens, the real-world ver­sion of link­ing your Spo­tify account to your social media account allow­ing playlists to leak through. Face­book spent a year [83]hon­ing its audio sam­pling and devel­op­ing a cat­a­log of con­tent — mil­lions of songs and 160 tele­vi­sion sta­tions — to match against. It’s obvi­ous that it wants to dis­place Twit­ter as the go-to place for real-time com­ment­ing on sport­ing events, awards shows, and other com­mu­nal tele­vi­sion watch­ing. “With TV shows, we’ll actu­ally know the exact sea­son and episode num­ber you’re watch­ing,” says Zhou. “We built that to pre­vent spoilers.”. . . .

10. An article not included in the original broadcast notes that Facebook is manifesting what one Silicon Valley CEO sees as a trend in corporate data harvesting.

“Here’s How to Defend Your­self from Facebook’s New Browser-Spying Campaign” by Mark Sullivan; Ven­ture­Beat [32]; 6/12/2014. [32]

Face­book sent out a notice Thurs­day about its inten­tion to begin shar­ing the brows­ing data of its mem­bers with its adver­tis­ing part­ners [84].

It’s a move that most observers saw com­ing, but one that Face­book has always denied — with vigor.

Face­book can’t cap­ture data about you vis­it­ing just any site, only those that have part­nered with it. Basi­cally, any site that has a “like” but­ton (such as this one) or that per­mits you to log in with your Face­book cre­den­tials will store data about your visit in your browser, which can later be read by Facebook.

Here’s how Face­book describes it in its Terms of Service:

“We and our affil­i­ates, third par­ties, and other part­ners (“part­ners”) use these tech­nolo­gies for secu­rity pur­poses and to deliver prod­ucts, ser­vices and adver­tise­ments, as well as to under­stand how these prod­ucts, ser­vices and adver­tise­ments are used. With these tech­nolo­gies, a web­site or appli­ca­tion can store infor­ma­tion on your browser or device and later read that infor­ma­tion back.”

Face­book also released a video to adver­tis­ers and users Thurs­day morn­ing explain­ing the company’s tar­get­ing prac­tices. A com­mon mantra among web mar­keters is that they’re actu­ally doing con­sumers a favor by col­lect­ing the infor­ma­tion they need to serve more rel­e­vant ads.

What to do (and not bother doing)

If you don’t want Face­book to col­lect and trans­mit your brows­ing data, you can take some steps to pre­vent it from doing so.

But first, here’s what not to do.

The adver­tis­ing indus­try has put up a site called Your Ad Choices [85], which offers con­sumers a way to “opt out.” But the site lets you opt out of receiv­ing ads that have been tar­geted at you based on your brows­ing data. But it will not let you “opt out” from com­pa­nies har­vest­ing your brows­ing data.

Nor can you expect to get any real relief by try­ing to tweak­ing your Face­book Pri­vacy set­tings. Face­book announced today that it would be rolling out “ad pref­er­ences,” a new tool acces­si­ble from every ad on Face­book that “explains why you’re see­ing a spe­cific ad and lets you add and remove inter­ests that we use to show you ads.” Of course, Face­book is not offer­ing you a way to stop them from col­lect­ing your brows­ing data in the first place.

Sev­eral browser plug-ins will block sites like Face­book from drop­ping lines of code into your browser allow­ing it to track you.

One of the good ones is Do Not Track Me [86]from Abine.com. This is a Wash­ing­ton, D.C.-based firm that focuses on build­ing browser tools to secure brows­ing data and other per­sonal information.

Other solid rec­om­men­da­tions that will work on Chrome and Fire­fox browsers are Ghostery and Disconnect.

Abine CEO Rob Shavell says he isn’t sur­prised by the news about Facebook.

“I think you’re going to see a lot more com­pa­nies doing this,” Shavell told Ven­ture­Beat. “Hav­ing worked at a ven­ture cap­i­tal firm in Sil­i­con Val­ley, I think there’s a data bub­ble going on. There’s been so much money invested in ad tech com­pa­nies, includ­ing Face­book, and so much hype around them, they are going to have to col­lect more and more per­sonal data. There’s just too much pres­sure to make all that money back.”

Shavell says investors have put $6.5 bil­lion behind adver­tis­ing tech com­pa­nies in the past two years.

Face­book did not respond to a request for com­ment on this story.