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The National Endowment for Democracy (NED) was created by the Reagan administration in the early 1980s to push democratic reform and roll back Soviet influence in various parts of the globe. In his 1983 speech inaugurating NED, President Ronald Reagan said: "I just decided that this nation, with its heritage of Yankee traders, ought to do a little selling of the principles of democracy."

The private, congressionally funded NED has been a controversial tool in U.S. foreign policy because of its support for groups that push an agenda closely in line with U.S. objectives and because of its association with efforts to overthrow foreign governments. As the writers Jonah Gindin and Kirsten Weld remarked in the January/February 2007 NACLA Report on the Americas: "Since [1983], the NED and other democracy-promoting governmental and nongovernmental institutions have intervened successfully on behalf of 'democracy'—actually a very particular form of low-intensity democracy chained to pro-market economics—in countries from Nicaragua to the Philippines, Ukraine to Haiti, overturning unfriendly 'authoritarian' governments (many of which the United States had previously supported) and replacing them with handpicked pro-market allies."

Funded almost entirely by the U.S. government, NED claims on its website to be "guided by the belief that freedom is a universal human aspiration that can be realized through the development of democratic institutions, procedures, and values. Governed by an independent, nonpartisan board of directors, the NED makes hundreds of grants each year to support pro-democracy groups in Africa, Asia, Central and Eastern Europe, Eurasia, Latin America, and the Middle East."

Today, according to the NED, the organization "continues to focus many of its resources on the remaining communist and authoritarian countries such as China, North Korea, Cuba, Serbia, Sudan, and Burma. NED maintains a long-term, flexible approach that takes advantage of any realistic opportunity to advance democratic ideals, defend human rights, and encourage the development of civil society."

The NED has in recent years bolstered its activities in areas of the world that are the focus of the Bush administration's war on terror, including in the Middle East and North Africa, where, according to its website, the endowment supports "civil society efforts to promote dialogue on the compatibility of Islam and democracy as well as women's rights and political empowerment platforms, and to strengthen the capacity of civil society organizations to combat corruption, advocate for constitutional and legal reform, and pressure governments for accountability and transparency." This new focus was highlighted by President George W. Bush during a major foreign policy speech he gave at the NED in October 2005 about the war on terror. He said: "[T]he United States has adopted a new policy: a forward strategy of freedom in the Middle East. This strategy requires the same persistence and energy and idealism we have shown before and it will yield the same results. ... The advance of freedom is the calling of our time. It is the calling of our country." In February 2004, Bush proposed doubling NED's funding to $80 million to expand its democratization program in the Greater Middle East as part of the war on terror (USINFO.gov, February 2, 2004).

NED works through four core institutes: the National Democratic Institute for International Affairs (NDIIA), the International Republican Institute (IRI), the American Center for International Labor Solidarity (ACILS), and the Center for International Private Enterprise—representing, respectively, the country's two major political parties, organized labor, and the business community.

In summer 2007, NED officers included Vin Weber, NED's chairman and a high profile Washington lobbyist associated with the Project for the New American Century (PNAC) and a host of other neoconservative-led outfits; former Democratic Rep. Richard Gephardt, who serves as vice chair; and Carl Gershman, NED president and a longtime figure in U.S. sectarian politics dating back to the 1970s. The NED Board of Directors includes Morton Abramowitz of the Century Foundation, former Republican Rep. Chris Cox, and Francis Fukuyama, an erstwhile supporter of the neoconservative political faction and well-known political scientist.

Origins, Leadership, Connections. When it was created in1983, NED's core agenda was to support political groups in target countries that would contest left-of-center organizations and political parties. In announcing its creation, President Ronald Reagan said that the NED would achieve this goal by supporting "the infrastructure of democracy—the system of a free press, unions, political parties, and universities—which allows a people to choose their own way, to develop their own culture, to reconcile their own differences through peaceful means" (Beth Sims, "National Endowment for Democracy: A Foreign Policy Branch Gone Awry," March 1990).

Allen Weinstein, a member of the U.S. Agency for International Development (USAID) working group known as the Democracy Group, which proposed the formation of a quasi-governmental group to channel U.S. political aid, served as NED's acting president during its first year. Talking about the role of NED, Weinstein told the Washington Post in 1991 that "a lot of what we do today was done covertly 25 years ago by the CIA" (Washington Post, September 22, 1991).

Under NED's elaborate structure, designed to veil U.S. government funding, U.S. Information Agency (USIA) and USAID funding did not flow directly to foreign political parties, unions, business associations, and civic groups, but was instead routed through the AFL-CIO, the International Chamber of Commerce, and the IRI and NDIIA. NED's origins go back to a bipartisan commission called the American Political Foundation established by the State Department that began to address the problem of having U.S.-funded "soft-side" overseas operations perceived as CIA fronts (Sims, "National Endowment for Democracy: A Foreign Policy Branch Gone Awry").

The working model for a new type of foreign operations program was the AFL-CIO's Free Trade Union Institute, which was funded by USAID and a tripartite directorship of labor, business, and government officials. In turn, the American Political Foundation called for a feasibility project called the Democracy Program, which formulated the objectives and structures for NED. Although the Democracy Program included business and USIA officials, its key movers were neoconservatives: Eugenia Kemble (sister of Penn Kemble), George Weigel (later with the Ethics and Public Policy Center and a signatory of PNAC's founding statement), Raymond Gastil of Freedom House, and Weinstein (member of neocon-led 1970s group the Coalition for a Democratic Majority and later president of the NED-funded Center for Democracy).

Gershman, the founding and current president of NED, was an organizer with the Socialist Party. As a member of a right-wing faction of the party known as Shachtmanites (followers of Trotskyist leader Max Shachtman), Gershman challenged Michael Harrington's leadership of the Socialist Party in 1972. While Harrington was a vociferous opponent of the Vietnam War, the Shachtmanites supported the war and favored Republican Richard Nixon over Democrat George McGovern in the presidential election campaign that year.

After the Socialist Party split, Gershman—together with Rachelle Horowitz and Tom Kahn (both of whom worked with the CIA-funded International Affairs Department of the AFL-CIO)—founded the Social Democrats/USA (SD/USA). For many neoconservatives with Trotskyist backgrounds, SD/USA became their main point of entry into the struggles to break the control of the progressive "New Politics" faction of the Democratic Party. Although it had only a few dozen members and associates, SD/USA exercised major influence in the AFL-CIO and in shaping foreign policy objectives in the Reagan administration.

In the late 1970s a bipartisan group of foreign policy hawks concluded that a new system was needed to channel "political aid" to an international network of "free" trade unions, anti-leftist political parties, publishing houses, and civic groups that would promote U.S. foreign and military policies. A faction of neoconservatives associated with SD/USA and the AFL-CIO's International Affairs took the lead in working with right-wing corporations and the U.S. government to address this need through the American Political Foundation, which received State Department funding to explore new avenues to offer U.S. government support for "domestic pluralistic forces in totalitarian countries" (Tom Barry and Deb Preusch, The Soft War: The Uses and Abuses of U.S. Economic Aid in Central America, p. 247).

To substitute for secret CIA financing of political and cultural organizations (which had been prohibited by Congress after revelations that the CIA was funding domestic academic and cultural organizations), neoconservatives and their labor partners advocated that Reagan establish a quasi-governmental organization to redirect USIA and USAID funds.

Not only did NED give neoconservatives a government-funded institute over which they exercised effective control, but it also facilitated close links with the U.S. government-funded international operations of the AFL-CIO, while building new ties with business. NED supported the creation of a series of neoconservative-led front groups that sought bipartisan and U.S. public support for an interventionist policy in Central America, which was part of the larger rollback, containment policy advocated by groups such as the Committee on the Present Danger and the Coalition for Peace through Strength. One of the most prominent of these NED-financed front groups was the Project for Democracy in Central America (PRODEMCA), whose objectives merged the hard (military) and soft (political aid/public diplomacy) sides of the neoconservative agenda in Central America. On the one hand, it received clandestine support from the unofficial "Project Democracy" of the National Security Council, operated by Oliver North and supervised by Elliott Abrams. On the other hand, it received USAID funding through NED for public diplomacy efforts (for more, see GroupWatch Profiles: Committee on the Present Danger, Nicaraguan Freedom Fund, and the Puebla Institute).

Cold War politics and nationalism partly explain the bizarre and intricate networks that brought U.S. government agencies together with the AFL-CIO, corporate America, and former Trotskyists. But the partnerships did not end with the Cold War. Gershman was an initial enthusiast of Middle East and North Korea democratization as part of the Bush administration's regional restructuring agendas (see Carl Gershman, "Promoting Democracy in the Muslim World," Presentation to the World Conference of Democracy-Supporting Organizations, March 21, 2003). However, he began expressing reservations about this strategy as the Iraq War began to spiral out of control after the invasion.

In a June 2007 op-ed for the Washington Post, Gershman wrote that part of the problem with the Bush democracy agenda was its focus on the Middle East, where conditions for democracy "are far from favorable." In the Middle East, wrote Gershman, "Liberal reformers occupy a narrow political space between authoritarian regimes and Islamist opposition movements, both of which benefit from their mutual antagonism at the expense of the small democratic center. And the president's call for 'a forward strategy of freedom in the Middle East' has been blunted by the continuing violence in Iraq and the deepening crisis with Iran. One cannot expect to see democratic breakthroughs in this troubled region in the near term" (Washington Post, June 8, 2007).

Weber, NED chairman, signed the 1997 PNAC founding statement, along with current NED board member Fukuyama and former board members Paula Dobriansky and Paul Wolfowitz (both of whom joined the George W. Bush administration in 2001). Weber was swept into Congress as representative of his Minnesota district by the New Right tide that put Ronald Reagan in the White House. Along with Newt Gingrich and several other right-wing congressional members, Weber founded the Conservative Opportunity Society, which succeeded in ousting the moderate GOP leadership and setting the stage for the so-called conservative revolution led by Gingrich in the 1994 elections (Bill Berkowitz, "Back to the Future," Working for Change, July 27, 2001).

Weber cofounded, along with William Bennett and Jack Kemp (who both served as cabinet members during the Reagan administration), the neoconservative Empower America institute. Another former Empower America director, Michael Novak, has also served as a NED board member. Weber's election as NED chairman in 2001 together with Julie Finley as vice-chair signaled that NED would closely follow Bush's foreign policy agenda in its democracy-building efforts. Finley, who as of mid-2007 was no longer on the NED board, also has connections with various neoconservative-driven groups, including the Committee for the Liberation of Iraq and the American Enterprise Institute's Project on Transitional Democracies.

Focus on Cuba. Since its founding, NED has served as an instrument of U.S. policy to support the Cuban-American efforts to oust Cuba's longtime leader Fidel Castro. Although many experts and advocates in democracy building and in fostering democratic transitions believe that a constructive engagement—economically and diplomatically—encourages internal processes of democratization, NED has long supported U.S. groups that are strident proponents of continuing the U.S. embargo and diplomatic isolation of Cuba. In the 1980s and through the Bush senior administration, two of the favored instruments of NED democratization funding in Cuba were the Cuban American National Foundation (CANF) and the AFL-CIO's American Institute for Free Labor Development (AIFLD), which managed the Labor Committee for a Free Cuba (Beth Sims, "Turning the Screws on Cuba," NED Backgrounder, June 1992). NED funding in Latin America and the Caribbean frequently goes to U.S.-based Cuban-American groups (Tom Barry, "Third Decade of Regime Change Aid," Right Web Analysis, June 25, 2004).

Haiti and Venezuela. The IRI has been a favored NED grantee since the beginning of the George W. Bush administration. In Latin America, for example, NED's five largest grants to country-specific programs in 2002 went to IRI for programs in Cuba ($350,000 to support the Cuban Democratic Directorate), Guatemala ($300,000 for technical assistance to political parties), Venezuela ($300,000 for training and coalition-building for opposition political parties), Peru ($300,000 to strengthen political parties), and Nicaragua ($200,000 to empower IRI's local counterpart, Hagamos Democracia).

According to Robert Maguire, director of the Haiti Program at Trinity College in Washington, DC: "NED and USAID are important, but actually the main actor is the International Republican Institute, which has been very active in Haiti for many years but particularly in the last three years. IRI has been working with the opposition groups. IRI insisted, through the administration, that USAID give it funding for its work in Haiti. And USAID has done so but kicking and screaming all the way. IRI has worked exclusively with the Democratic Convergence groups in its party-building exercises and support. The IRI point person is Stanley Lucas who historically has had close ties with the Haitian military. All of the IRI sponsored meetings with the opposition have occurred outside Haiti, either in the [Dominican Republic] or in the United States. The IRI ran afoul with [Jean-Bertrand] Aristide right from the beginning since it has only worked with opposition groups that have challenged legitimacy of the Aristide government. Mr. Lucas is a lightning rod of the IRI in Haiti. The United States could not have chosen a more problematic character through which to channel its aid" (Tom Barry, "Aristide's Fall: The Undemocratic U.S. Policy in Haiti," IRC America's Program, February 27, 2004).

Many observers accused Washington of having been behind the attempted ouster of Venezuela's President Hugo Chávez in April 2002, but the Bush administration denied any U.S. involvement. However, one relatively clear connection emerged between the U.S. government and the anti-Chávez movement: before the coup attempt, millions of U.S. taxpayer dollars were channeled through the IRI and other U.S. organizations that funded groups opposed to Chávez. Writer Mike Ceaser reported that in an April 12, 2002, fax sent to news media, IRI President George A. Folsom rejoiced over Chávez's removal from power. "The Venezuelan people rose up to defend democracy in their country," Folsom wrote. "Venezuelans were provoked into action as a result of systematic repression by the government of Hugo Chávez." With NED funding, IRI had been sponsoring political party-building workshops and other anti-Chávez activities in Venezuela. "IRI evidently began opposing Chávez even before his 1998 election," wrote Ceaser. "Prior to that year's congressional and presidential elections, the IRI worked with Venezuelan organizations critical of Chávez to run newspaper ads, TV, and radio spots that several observers characterize as anti-Chávez" (Mike Ceaser, "As Turmoil Deepens in Venezuela, Questions Regarding NED Activities Remain Unanswered," Americas Program, December 9, 2002).

According to NED's website, the largest single 2002 NED grant in Latin America went to ACILS. NED gave this USAID-supported branch of the AFL-CIO $775,000 "to implement a program to reinforce the capacity of labor unions to promote economic and political reform and build alliance with civil society at community and national levels." ACILS did the same in Venezuela, where it worked with anti-Chávez worker groups that formed an alliance with business, civil society, and political parties that engineered the attempted coup in April 2002. The same year, ACILS received $116,000 to "support the Venezuelan trade movement, represented by the Confederation of Venezuelan Workers, in developing a program to extend organization, training, and representation to the informal sector."

Creating a "Movement." In the mid-1990s NED concluded that it needed to revamp its methodology of democratization. In an age of globalization, as exemplified by the anti-free-trade movement, NED decided to start its own global citizens' movement. Rather than channeling U.S. government funds to disparate groups, in 1999 Gershman established his office as the "secretariat" for a World Movement for Democracy (see NED's Building a Worldwide Movement for Democracy website, http://www.ned.org/about/building.html; also, David Lowe, "Idea to Reality: A Brief History of the National Endowment for Democracy," NED, undated).

The movement's objective, according to its website, is to "offer new ways to give practical help to democrats who are struggling to liberalize authoritarian systems and to consolidate emerging democracies." Funding for some of NED's World Movement for Democracy (WMD) program has come from the right-wing Smith Richardson Foundation (see MediaTransparency.org, "National Endowment for Democracy").

Under the umbrella of the WMD are several other global "pro-democracy" networks that NED has been developing, including the International Movement of Parliamentarians for Democracy, Network of Young Democracy Activists, Democracy Information and Communications Technology Group, and the Network of Democracy Research Institutes. The latter, which includes as members think tanks and policy institutes throughout the world, receives research and technical assistance from NED's Democracy Resource Center.

Opposition and Criticism. Since its inception, NED has been the focus of intense debate and criticism regarding the proper role of the United States in fostering democracy around the world. Although promoted as idealistically oriented programs aimed at encouraging democratic development, NED's work has been repeatedly criticized by observers from all political backgrounds for being potentially detrimental to U.S. relations with other countries and an inappropriate use of taxpayer money. For instance, Rep. Ron Paul, a Republican from Texas, lambasted NED in an October 2003 op-ed, arguing: "The misnamed National Endowment for Democracy (NED) is nothing more than a costly program that takes U.S. taxpayer funds to promote favored politicians and political parties abroad. What the NED does in foreign countries, through its recipient organizations the National Democratic Institute (NDI) and the International Republican Institute (IRI), would be rightly illegal in the United States. The NED injects 'soft money' into the domestic elections of foreign countries in favor of one party or the other. Imagine what a couple of hundred thousand dollars will do to assist a politician or political party in a relatively poor country abroad. It is particularly Orwellian to call U.S. manipulation of foreign elections 'promoting democracy.' How would Americans feel if the Chinese arrived with millions of dollars to support certain candidates deemed friendly to China? Would this be viewed as a democratic development?" (AntiWar.com, October 11, 2003).

In his brief history of the NED, the endowment's David Lowe addressed criticism of the organization, arguing that it was largely based on "ideological grounds," with left-wingers arguing that it represents an inappropriate interference in the internal affairs of other countries and right-wingers worrying that, due to the involvement of labor unions, the NED was fostering a social democratic model. Brushing aside this criticism, Lowe pointed to a slate of rightist organizations that have proved to be NED's biggest supporters, including such conservative and neoconservative-led outfits as the Heritage Foundation, Empower America, the Wall Street Journal , the Washington Times, and the National Review (David Lowe, "Idea to Reality: A Brief History of the National Endowment for Democracy," NED, undated).

Some centrist writers have also supported some of NED's work, including the British historian Timothy Garton Ash, who in a January 2004 article for the Guardian highlighted what he viewed as the positive role NED and other like-minded organizations have played in recent world affairs. He wrote: "I've seen the impact of the National Endowment for Democracy, together with our own Westminster Foundation for Democracy and other semi- and wholly non-governmental organizations in eastern Europe and the Balkans. Without their work, Slobodan Milosevic might not have been toppled by a revolution in Serbia. Add the clear message that corrupt, oil-bloated Arab elites no longer enjoy Washington's unconditional support, and we could see some fireworks. Not laser-guided American military fireworks from the sky, but emancipatory Arab fireworks from the ground. The fact that this support for would-be democrats is tainted by its association with the United States, the neo-imperialist occupier of Arab lands, will, I suspect, dampen but not extinguish the fuse" (Guardian, January 21, 2004).

The NED has frequently been accused of blurring the line between U.S. intervention and democracy promotion. In 2004, after Hugo Chávez easily won a referendum in August on his presidency, accusations emerged about the NED's role in supporting anti-Chávez groups. When the government arrested leaders of these groups, Gershman denounced the action, saying: "In the spectrum between democracy and dictatorship, the prosecution against the activists would be moving ... closer to the authoritarian end." Regarding Chávez's claims that the NED was part of a CIA effort to undermine his government, Gershman said: "That's propaganda" (see "Venezuela is Inching Toward Dictatorship, Says U.S. Group," Irish Times, November 11, 2004).

Government ministers in Venezuela have also alleged that some groups receiving NED funds were involved in the 2002 coup against Chávez. Said one minister: "I wonder whether they are really promoting democracy, because they support people who have acted against democracy" (Irish Times, November 11, 2004).

In the mid-1980s, the NED was knee-deep in U.S. intervention in Central America. During the 1984 elections in Panama, for example, it supported a candidate associated with the military, Nicholas Ardito Barletta, despite the fact that the United States was purportedly opposed to military rule in the country. The NED's actions prompted an angry response from the U.S. ambassador, who wrote in a secret cable: "The embassy requests that this hair-brained project be abandoned before it hits the fan" (Cato Institute, November 1993).

"An even more dubious initiative," wrote Barbara Conry for a 1993 Cato Institute report, "was NED's involvement in Costa Rica. Not only is Costa Rica a well-established democracy—former president George Bush visited the country in 1989 to celebrate 100 years of democracy there—it is the only stable democracy in Central America. But Costa Rican president Oscar Arias had opposed Ronald Reagan's policy in Central America, especially his support of the Nicaraguan Contras. Arias received the Nobel Peace Prize for his efforts to dampen conflicts in the region, but he incurred the wrath of right-wing NED activists. So from 1986 to 1988 NED gave money to Arias's political opposition, which was also strongly supported by Panamanian dictator Manuel Noriega. As Rep. Stephen Solarz (D-NY) commented: 'They may technically have been within the law, but I felt this clearly violated the spirit. ... The whole purpose of NED is to facilitate the emergence of democracy where it doesn't exist and preserve it where it does exist. In Costa Rica, neither of these [conditions] applies.'"

These and other activities have led many observers to question the value of the NED, as well as to highlight the potential danger it poses to U.S. interests. Concluded Conry: "Promoting democracy is a nebulous objective that can be manipulated to justify any whim of the special-interest groups—the Republican and Democratic parties, organized labor, and the U.S. Chamber of Commerce—that control most of NED's funds. As those groups execute their own foreign policies, they often work against American interests and meddle needlessly in the affairs of other countries, undermining the democratic movements NED was designed to assist."

Others have faulted the NED and its affiliates emphasizing only one particular form of democracy, pro-market democracy. Wrote Jonah Gindin and Kirsten Weld in the January/February 2007 NACLA Report on the Americas: "By combining cooptation, coercion, and deep pockets, groups like the NED and the U.S. Agency for International Development (USAID) have at times allied themselves with antidemocratic elites, and at other times capitalized on movements and individuals that were genuinely dedicated to democratizing their countries, setting the parameters of the debate by positioning a particular definition of pro-market representative democracy as the only antiauthoritarian option. U.S. and European organizations have disbursed massive amounts of money, funding some groups and projects while ignoring others, favoring those who share their general ideological conceptions while isolating those that do not."