Exploring the roots of the NED


I was reading an old lawsuit against the National Endowment for Democracy and came across some history of the organization. Lawyers wrote:
“NED acknowledged that it is and was exercising a traditional governmental CIA (Central Intelligence Agency) function. When it was revealed in the late 1960’s that some American private volunteer organizations were receiving covert funding from the CIA to wage the battle of ideas at international forums, the Johnson Administration concluded that such funding should cease, and recommended the establishment of ‘a public-private mechanism’ to fund overseas activities openly. Accordingly NED was established.”

William I. Robinson

A Sept. 30, 1993, speech by sociology professor William Robinson contends that NED is “closer to clandestine national security organs such as the CIA than to the apolitical or humanitarian endowments its name would suggest.” I am sure the NED would dispute many of the Robinson’s claims, but his speech provides an interesting perspective and I am reproducing it below:

A US stance in favor of democracy helps get the Congress, the bureaucracy, the media, the public, and elite opinion to back US policy. It helps ameliorate the domestic debate, disarms critics (who could be against democracy?), provides a basis for reconciliation between “realists” and “idealists”…The democracy agenda enables us, additionally, to merge and fudge over some issues that would otherwise be troublesome. It helps bridge the gap between our fundamental geopolitical and strategic interests…and our need to clothe those security concerns in moralistic language…The democracy agenda, in short, is a kind of legitimacy cover for our more basic strategic objectives.”
Howard Wiarda, speaking at a State Department meeting convened to discuss the formation of the NED Policymakers in Washington would like us to believe that the United States is engaged in a noble crusade to promote democracy in Latin America and around the world. As part of this crusade, a decade ago they created the National Endowment for Democracy (NED). The NED’s self-proclaimed purpose is to “foster the worldwide development of democratic institutions and processes, individual rights and freedoms.” Lofty and virtuous goals, indeed. But, rhetoric notwithstanding, these are not the goals of the US government, nor of the NED.
For many years, the United States promoted dictatorship in Latin America, propping up the Somozas, the Duvaliers, the Pinochets, the Argentine and Guatemalan generals, and so on. Authoritarianism was seen as the most expedient means of defending US hegemony and US “interests,” as defined by policymakers in Washington. In fact, this was the general pattern throughout the Third World. The United States buttressed its global empire, constructed after World War II, through support for antidemocratic systems: white minority regimes and one-party dictatorships in Africa, monarchies and caste systems in the Middle East, and repressive authoritarian states in Asia. But democratic aspirations run deep, at home and abroad, and cannot be suppressed forever. Mass movements striving for democratization and social change have proliferated. As the “elective affinity” between authoritarianism and US hegemony in the Third World began to unravel in the late 1970s, in the face of mass, popular democratization movements, the new tune in Washington became “promotion of democracy.” Where it had earlier supported dictatorship in Chile, Nicaragua, Haiti, the Philippines, Panama, Southern Africa, and elsewhere the United States now began to “promote democracy.”
New governmental and quasi-governmental agencies were created to conduct “democracy promotion” programs, among them, the NED. Has the Washington policymaking establishment really discovered the virtues of democracy around the world, or is something else going on? Let us pierce away at the rhetoric and consider the following points.

Don’t judge a book by its cover

The name “National Endowment for Democracy” is a misnomer, and a deliberate one. It conjures up an apolitical and benevolent image, such as that enjoyed by the National Endowment for the Arts or other humanitarian societies. In fact, the NED was created at the highest echelons of the US national security state, as part of the same project that led to the illegal operations of the Iran-contra scandal. In structure, organization and operation, it is closer to clandestine national security organs such as the CIA than to the apolitical or humanitarian endowments its name would suggest. The NED grew out of Project Democracy, a secret program launched by the Reagan administration in 1981 under the auspices of the National Security Council.
Project Democracy was personally supervised by Walter Raymond Jr., a high- ranking CIA propaganda specialist who worked closely with Oliver North on illegal covert activities. In 1983, Reagan signed National Security Decision Directive 77 (NSDD 77), which laid out a comprehensive framework for employing what, in the jargon of the US intelligence and national security community, is known as “political operations” and “psychological warfare.” NSDD focused on three aspects. One was dubbed “public diplomacy,” and led to the creation of an Office of Public Diplomacy (OPD) operating out of the White House. In 1988, a congressional investigation concluded that the OPD was functioning as an illegal domestic propaganda operation. Orders were issued to close the OPD down. The second aspect outlined in NSDD 77 was the expansion of covert operations around the world. This aspect would eventually develop into the clandestine, illegal government operations exposed in the Iran-contra scandal. The third aspect was the creation of a “quasi- governmental institute” directed at “support [for] United States policies and interests relative to national security.” This institute was to become the NED, formally created in 1983 by an act of Congress.
Parallel to “the public arm of Project Democracy, now known as the National Endowment for Democracy,” noted The New York Times in 1987, “the project’s secret arm took an entirely different direction after Lt. Col. Oliver I. North, then an obscure National Security Council aide, was appointed to head it.” The Times described North’s activities and NED operations as “open and secret parts” of the same project, “born as twins.” The NED would like us to forget its unsavory origins. Moreover, political operations, psychological warfare, covert intervention, and so forth, are not palatable concepts for the public. Describing these operations as “democracy promotion” is more ideologically satisfying and easier to sell.

The NED: A specialized agency of the US government

NED officials describe the organization as “independent” and “private.” “Non-governmental” is its official juridical status. However, in practice the NED functions as a specialized branch of the US government. The NED is wholly funded by Congress. Monies are channeled through the State Department’s Agency for International Development (AID) and the United States Information Agency (USIA). All NED programs are first submitted to the State Department for approval, and US embassies abroad frequently handle logistics for and coordination of NED programs. The State Department and other executive agencies regularly appoint personnel to participate in NED programs. Although the NED is an arm of the US government, projecting the image of a quasi-private entity insulates NED operations from public scrutiny and accountability under the pretext of it being a “private” concern. For instance, the NED is not subject to congressional oversight, as is the CIA. Also, as one Project Democracy counselor pointed out: “Its private status enables it to deflect criticism from the US government when its policies and programs go awry or prove embarrassing as they sometimes do.” The official continued: “Private programs would be much less suspect than government efforts in the eyes of African, Asian and Latin American nationalists.” The fact that the NED is a branch of the US government is crucial: NED operations must be seen as component parts of overall US foreign policy undertakings. NED activities are coordinated with the full panoply of US policy instruments. The countries where the NED became the most involved in the 1980s and early 1990s were precisely those set as priorities for US foreign policy. As one Project Democracy consultant noted, “In order to wage a worldwide effort [i.e., a “crusade for democracy”]…we must struggle militarily, economically, politically and ideologically.” Thus, for example, in Nicaragua, NED programs were effectively combined with an economic blockade, military aggression by the contras, CIA covert operations, and ideological warfare.

Overt on paper, covert in practice

The NED claims to conduct its activities publicly, above board. In practice, the NED operates as a semiclandestine and highly secretive organization. Through an elaborate structure of intermediaries
and third-parties, its activities are shrouded in secrecy, and NED officials operate more often in the shadows than in the open, much like an agency dedicated to covert operations. The NED functions through a complex system of intermediaries in which operative aspects, control relationships, and funding trails are nearly impossible to follow and final recipients are difficult to identify. Most monies originating from the NED are first channeled through US organizations which, in turn, pass them on to foreign counterparts, who are themselves often pass-throughs for final recipients.
Financial accounting becomes nearly impossible, facilitating all sorts of secret funding, laundering operations and book-keeping cover-ups which allow for unscrutinized transactions. In “A Faustian Bargain,” I documented NED’s on-the-ground activities in Nicaragua, an untold story of dirty tricks, duplicity and secret intervention. The NED’s actual activities bear little or no resemblance to its stated activities, as is documented in the Nicaraguan case. However, the NED’s real activities never enter the public spotlight until or unless a skilled investigative reporter or researcher can dedicate the time and resources to their unmasking. This is quite a task, since the NED’s public relations officials screen all journalists and researchers, and simply refuse to provide interviews or information to those who might reach critical conclusions about the organization. Those such as myself must file a petition under the Freedom of Information Act to obtain so much as a copy of the NED’s annual report, which is supposed to be a report to the taxpaying public. And even then, NED annual reports tell us virtually nothing about what NED operatives are actually doing on the ground in the countries in which they are intervening. The compromising documentation does not officially exist: these documents are marked “not for the files” and are not released even under the Freedom of Information Act. Why would an agency which alleges to be dedicated to the innocuous and benevolent promotion of democracy censor its critics? Why would it function as a clandestine agency, shrouded in secrecy and underworld transactions?

“Political aid”: From the CIA to the NED

The Central Intelligence Agency (CIA) was created in 1947 as a covert branch of the US government. Since its inception, the CIA has carried out thousands of covert operations, overthrown countless governments, killed hundreds of thousands of people, and millions more indirectly, as a result of its actions. The CIA has traditionally had three functions: intelligence gathering; paramilitary campaigns; and what is known in intelligence circles as “political operations,” or more benignly, “political aid.” “Political operations” has involved the creation, covert funding and guidance of allied political groups in target countries the media, political parties, trade unions, business and civic associations, etc. During the 1970s, as many of its seamy covert operations became public, the CIA fell into disrepute. Congressional investigations revealed the sordid underworld of CIA covert activities at home and abroad. Top level CIA officers defected and exposed the history of overseas intrigues and investigative journalists uncovered unsavory details of secret US activities. By the late 1970s, the CIA was badly discredited, at home and also abroad, where association with CIA programs, especially “political aid” programs, meant instant repudiation. Policymakers began to lobby for the reorganization of the CIA’s “political operations.” They called for the establishment of an institution that would take over certain functions from the CIA, and in particular, that would specialize in providing “political aid” to allied groups in other countries. This institution became the NED. Specifically, the NED has taken over much of the funding and political guidance for political parties, trade unions, business groups, news media and civic organizations that the CIA had traditionally supplied. “It is not necessary to turn to the covert approach,” explained former CIA director William Colby in regard to the NED. “Many of the programs which were conducted as covert operations [can now be] conducted quite openly, and consequently, without controversy,” through the NED. In an earlier period, such US political aid was paid for with “CIA slush funds.”
Now it falls under the rubric of “grants from the NED.” Change in language helps sell the policy. But it does not alter the content of US intervention. The NED is nothing less than a sophisticated US government instrument for penetrating the political systems and civil societies in other countries down to the grassroots level. Bolstering the elite and marginalizing popular groups In countries around the globe, NED funds are used to strengthen or to create from scratch political parties, and civic, media, labor, business, and cultural organizations identified as responsive to US interests.
With few exceptions, the leaders of these organizations are drawn from the local elite and their efforts are aimed at competing with, or eclipsing, existing broad-based popular organizations and neutralizing efforts by popular sectors to build their own organizations in civil society. In Guatemala, for instance, the NED has not provided funds to any of the popular organizations struggling for authentic democratization, such as the internationally- respected Mutual Support Group (GAM). Instead, NED funds for Guatemala throughout the 1980s and early 1990s, handled by the US Republican Party and channeled through a regional front organization. The Central American Political Academy went to a conservative Guatemalan political party known as the Solidarity Action Movement (MAS). The MAS was founded by Jorge Serrano, the former Guatemalan president who failed in his April 1993 bid to grab dictatorial powers in a military- backed coup d’état. In Honduras, the NED has not funded the Committee for the Defense of Human Rights (CODEH), which has been praised by Amnesty International and Americas Watch as an exemplar human rights group in the Americas. But it Nicaragua, the NED channeled funds to two human rights organizations, one led by extreme-right opposition groups, and another which was formed in the late 1980s by the contras.
In Argentina, the NED has ignored the acclaimed Mothers of the Plaza de Mayo organization, and has instead provided hundreds of thousands of dollars to a rival organization, Conciencia, led by wealthy women from the country’s traditional oligarchy. In Chile and many other Latin American countries, the NED has poured millions of dollars into moderate and conservative trade unions which compete with more militant worker organizations.
The NED-supported unions are affiliated with the American Institution for Free Labor Development (AIFLD) of the AFL-CIO, whose ties with the CIA have been well- documented. In Haiti, mass-based democratic civic organizations spread like wildfire during the 1980s, coming together into the Lavalas Movement which overthrew the US-backed Duvalier dynasty and then voted Father Jean Bertrand Aristide into power. The NED, however, chose to marginalize these groups and instead funded a string of think tanks and political focus groups linked to the traditional elite the same elite which provided the base of support for the bloody September 1991 coup which toppled the Aristide government.

Promoting polyarchy

“In all societies, two classes of people appear a class that rules and a class that is ruled,” noted the Italian social scientist Gateano Mosca late last century. “The first class, always the less numerous, performs
all political functions, monopolizes power and enjoys the advantages that power brings, whereas the second, the more numerous class, is directed and controlled by the first, in a manner that is now more or less legal, now more or less arbitrary and violent.” Mosca is the originator of elite theories of democracy. Sharing his political analysis was Joseph Schumpeter, a luminary figure in US academia, often cited in the pages of the NED’s publication, Journal of Democracy.
“Democracy means only that the people have the opportunity of accepting or refusing the men who are to rule them,” asserted Schumpeter. These elitist theories of democracy culminated in what Robert Dahl calls “polyarchy,” a system in which a small group actually rule and mass participation in decision making is confined to leadership choice in elections that are carefully managed by competing elites.
When NED and other US officials speak of “promoting democracy” what they really mean is the promotion of polyarchy. In turn, the shift in US foreign policy from supporting authoritarianism to promoting polyarchy means, as Mosca put it, shifting from a manner of elite rule that is “more or less arbitrary and violent” to a manner of elite rule that is “more or less legal.” Elite rule, for US policymakers, is not to be questioned; it is to be defended by promoting polyarchy, in place of authoritarianism, so as to preempt any outcomes to democratization struggles that would alter the status quo and lead to popular democracy.
Popular democracy, the alternative to polyarchy, posits not only deeper forms of participatory, or direct, democracy, intermeshed with representative forms of government and formal elections, but social justice, economic equalities, national sovereignty and the democratization of international relations, including the international economic order. Popular democracy, constructed on the classical definition of democracy as the rule, or power (cratos) of the people (demos), means a people’s control over their vital affairs. It means a disbursal throughout society of political power currently concentrated in the United States, as in Latin America in the hands of elite minorities. It means the redistribution of wealth, the democratization of highly concentrated property ownership, democratizing access to social and cultural opportunities. It implies the participation of broad majorities in decisions which affect their daily lives. It means a people’s control over the collective material and cultural resources of society. At the heart of this competing concept of democracy is the construction of a democratic socioeconomic order. This type of popular democracy, or “high-intensity democracy,” is antithetical to the “low-intensity democracy” which the US seeks to promote. High-intensity democracy threatens elite status quos and US hegemony. In Haiti, in Chile, in the Philippines, in South Africa, in Nicaragua, and elsewhere, masses of people have been struggling to replace dictatorships put in power and kept in power by Washington with high-intensity democracy. In crucial moments of these struggles Washington has stepped in, through NED programs and other forms of intervention, to assure an outcome of “low- intensity democracy.”

The NED and social justice in the new world order

What are the “more basic strategic objectives” for which, according to Howard Wiarda, “democracy promotion” is a “legitimacy cover”? “We have 50% of the world’s wealth, but only 6.3% of its population…In this situation we cannot fail to be the object of envy and resentment,” noted George Kennan in 1948, one of the most important architects of post-World War II US foreign policy. “Our real task in the coming period is to devise a pattern of relationships which will allow us to maintain this position of disparity,” said the then-Director of Policy Planning at the State Department. “We should cease to talk about the raising of living standards, human rights, and democratization. The day is not far off when we are going to have to deal in straight power concepts. The less we are then hampered by idealistic slogans, the better.” Kennan’s candid statement, contained in a top-secret document which discussed US strategy in the aftermath of World War II, is highly instructive on two accounts. First, it underscores that the strategic objective of US foreign policy during the Cold War was less battling a “communist menace” than defending gross inequalities in the international order and the tremendous privilege and power this global disparity of wealth brought for the United States as the hegemonic world power. Second, Kennan’s statement suggests that democracy abroad
was not a major consideration for the United States in the formative years of the post-World War II order. Four decades after Kennan’s 1948 counsel, in a speech to the American Political Science Foundation, NED President Carl Gershman admonished: “In a world of advanced communication and exploding knowledge, it is no longer possible to rely solely on force to promote stability and defend the national security. Persuasion is increasingly important, and the United States must enhance its capacity to persuade by developing techniques for reaching people at many different levels.” Gershman went on to stress in his speech, in sharp contrast to Kennan, that “democracy” abroad should be a major consideration for the United States in its effort to “enhance its capacity to persuade” around the world. The East-West prism in which Kennan and his generation had cast the North-South global divide in foreign policy dictates evaporated with the end of the Cold War.
Yet the fundamental objective of defense of Northern privilege in an unjust international system did not change with the collapse of the Soviet system. What has changed are the methods and strategies
for securing this objective. We are living in times of momentous changes in the international political order. From Nicaragua to the Philippines, from Haiti to Eastern Europe, Southern Africa, and the Middle East, and right here in the United States, diverse forces are engaged in a battle to reshape political and economic structures as the “new world order” emerges. Under the rubric of “promoting democracy,” the United States has developed new forms of political intervention, among them the NED, to intervene in the crises, transitions and power vacuums resulting from the breakup of the old order and to try and gain influence over their outcome. The NED and its political intervention is an instrument of “persuasion,” in contrast to or more often alongside force in assuring “patterns of relationships” that protect minority privileges in an unjust international system. A recent special United Nations report titled “Human Development 1992” tells us that 83% of the world’s wealth is concentrated in the North to the benefit of the 20% of the population living there, while 80% of the planet’s human beings in the South sustain this wealth yet benefit from only 17% of it. The wealthiest 20% of humanity controls 81% of world trade, 95% of its loans and 81% of its domestic savings. The same 20% consumes 70% of the world’s energy, 75% of its metals, 85% of its wood and 60% of its food supply. The current international “order” functions to the extent that it sustains this growing inequality, thus provoking a structural instability and portending prolonged global conflict. The world will pay a heavy price for allowing these elite global structures to be reinforced under one or another “legitimacy cover,” whether this cover be the fight against “international terrorism,” conducting “humanitarian missions,” or “democracy promotion.”