Bush Aims To Raise Whose Budget?

The skinny on the National Endowment for Democracy.

In Tuesday’s State of the Union address, President Bush vowed to double the budget of the National Endowment for Democracy. What’s the NED, and how much extra dough will it get if the president gets his way?

Depending on whom you ask, the NED is either a nonprofit champion of liberty or an ideologically driven meddler in world affairs. Both supporters and critics agree that the organization’s roots trace back to the late 1960s, when the Central Intelligence Agency came under fire for covertly funding opposition parties and activists in countries that seemed to be tilting toward the Soviets. When those CIA machinations came to light, the agency drew flak for what some saw as underhanded tinkering with sovereign governments. After years of debate as to whether and how the funding should continue, Congress created the NED in 1983.

The NED is essentially a grant-making organization, charged with disbursing money to pro-democracy groups around the globe. Though the NED is officially a private, nongovernmental organization, it gets the lion’s share of its funding from the U.S. Treasury; last year, for example, the Congress appropriated $35 million for the endowment, as part of its budget allocation for the State Department’s United States Information Agency. The NED also receives a small amount of revenue from the Journal of Democracy, its official publication, and from private donors.

As a 501(c)3 organization, the NED’s list of grantees is open to public inspection. The NED doles out over 300 grants per year, with the average grant amount topping $50,000. The four biggest recipients, by far, are the International Republican Institute, the National Democratic Institute for International Affairs, the AFL-CIO-affiliated American Center for International Labor Solidarity, and the pro-business Center for International Private Enterprise. According to a recent NED tax return, these four groups each received $4,606,250 in 2001, which they in turn handed out to pro-democracy groups as they saw fit. The idea behind funneling equal amounts to these four groups is to stress the non-partisan nature of the NED. Along the same lines, the NED’s board consists of bigwigs from both parties, including Democratic presidential hopeful Gen. Wesley Clark and Sen. Jon Kyl, R-Ariz.

The hundreds of small-fry recipients of the NED’s largesse range from media outlets like the Khartoum Monitor and the Tibet Times to human-rights groups such as the Shan Human Rights Foundation in Myanmar. One of the NED’s favorite success stories is its role in assisting Solidarity, the Lech Walesa-led Polish trade union that eventually helped topple Poland’s Communist regime.

But the NED has also drawn some withering criticism from both right and left during its 21-year history. The most common complaint is that the NED’s money only goes to support movements and politicians that fit into the United States’ foreign-policy objectives, regardless of whether those who receive the money engage in undemocratic campaigns. Most recently, the left assailed the NED for its indirect support of Venezuelan groups that were active in attempts to overthrow democratically elected President Hugo Chavez.

Critics on the right, meanwhile, have frequently griped about the NED’s grants to groups in Eastern Europe that have furthered the political aims of ex-Communists. Last October, Rep. Ron Paul, R-Texas, wrote a widely circulated screed against the NED, pointing out that its longtime president, Carl Gershman, was once executive director of the Social Democrats, USA—an organization that he branded as “neo-Trotskyite.”

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