Enterprise Resilience Management Blog

Laptops in Peru

I'd like to end the year on an up-note. There are plenty of stories to cause concern -- from the death of Benazir Bhutto to post-election riots in Kenya to more broken promises in North Korea to continued genocide in Darfur -- but they get more coverage than more positive stories like one about how laptops are changing the lives of children in Peru ["In Peru, a Pint-Size Ticket to Learning," by Frank Pajak, Washington Post, 30 December 2007]. The story focuses on 270,000 computers that have been provided to poor children in hopes of improving education in Peru.

"Doubts about whether poor, rural children really can benefit from quirky little computers evaporate as quickly as the morning dew in this hilltop Andean village [named Arahuay], where 50 primary school children got machines from the One Laptop Per Child project six months ago. These offspring of peasant families whose monthly earnings rarely exceed the cost of one of the $188 laptops -- people who can ill afford pencil and paper much less books -- can't get enough of their XO devices. At breakfast, they're already powering up the combination library/videocamera/audio recorder/musicmaker/drawing kits. At night, they're dozing off in front of them -- if they've managed to keep older siblings from waylaying the coveted machines."

I first wrote about the One Laptop Per Child project last December [Connecting the Poor]. In that post, I discussed some the criticism and opposition the project faced as the project was getting started. The results in Peru help allay some of that criticism. Pajak notes that original targets for price and distribution have been not met.

"Founded in 2005 by former MIT Media Lab director Nicholas Negroponte, the One Laptop program has retreated from early boasts that developing-world governments would snap up millions of the pint-size machines at $100 each. In a backhanded tribute, One Laptop now faces homegrown competitors everywhere from Brazil to India -- and a full-court press from Intel's more power-hungry Classmate. But no competitor approaches the XO in innovation. It is hard drive-free, runs on the Linux operating system and stretches wireless networks with 'mesh' technology that lets each computer in a village relay data to the others. Mass production began last month and Negroponte, brother of U.S. Deputy Secretary of State John D. Negroponte, said he expects at least 1.5 million machines to be sold by next November. Even that would be far less than Negroponte originally envisioned. The price, higher than initially advertised, and the non-Windows operating system that is still being tested for the XO have dissuaded many potential government buyers."

A year ago I reported that five countries -- Argentina, Brazil, Libya, Nigeria and Thailand -- had made tentative commitments to buy the XO, but Peru has become the poster child of the project.

"Peru placed the single biggest order to date -- more than 272,000 machines -- in its quest to turn around a primary education system that the World Economic Forum recently ranked last among 131 countries surveyed. Uruguay was the No. 2 buyers of the laptops, inking a contract for 100,000. Negroponte said 150,000 more laptops will be shipped to such countries as Rwanda, Mongolia, Haiti and Afghanistan in early 2008 through 'Give One, Get One,' a U.S.-based promotion ending Dec. 31 in which participants buy a pair of laptops for $399 and donate one or both. The children of Arahuay prove One Laptop's transformative conceit: that you can revolutionize education and democratize the Internet by giving a simple, durable, power-stingy but feature-packed laptop to the world's poorest kids. 'Some tell me that they don't want to be like their parents, working in the fields,' first-grade teacher Erica Velasco said of her pupils. She had just sent them to the Internet to seek out photos of invertebrates -- animals without backbones."

One of the interesting results to watch for will be how improved education affects the villages in which the computers are deployed. Historically, once someone gets an education they go looking for work that matches their skills and they are seldom found in rural settings. Peruvian leaders are hoping this trend doesn't continue. The key is providing education that matches the needs of the communities.

"Arahuay's lone industry is agriculture. Surrounding fields yield avocados, mangoes, potatoes, corn, alfalfa and cherimoya. Many adults share only weekends with their children, spending the workweek in fields many hours' walk from town and relying on charities to help keep their families nourished. When they finish school, young people tend to abandon the village. Peru's head of educational technology, Oscar Becerra, is betting the One Laptop program can reverse this rural exodus to the squalor of Lima's shantytowns four hours away. It's the best answer yet to 'a global crisis of education' in which curriculums have no relevance, he said. 'If we make education pertinent, something the student enjoys, then it won't matter if the classroom's walls are straw or the students are sitting on fruit boxes.' Indeed, Arahuay's elementary school population rose by 10 when families learned the laptop pilot was coming, said Guillermo Lazo, the school's director."

Although I have my doubts that urbanization will be stopped as a result of putting computers in the hands of rural students, such concerns should not prevent children from receiving an education. The program in Peru is widespread.

"The XOs that Peru is buying will be distributed to pupils in 9,000 elementary schools from the Pacific to the Amazon basin where a single teacher serves all grades, Becerra said. Although Peru boasts thousands of rural satellite downlinks that provide Internet access, only about 4,000 of the schools getting XOs will be connected, Becerra said. Negroponte says One Laptop is committed to helping Peru overcome that hurdle. Without Internet access, he said, the program is incomplete."

One of the early criticisms of the program was its focus on getting equipment to students rather than issues like teacher training and curriculum. The training remains minimal.

"Teachers will get 2 1/2 days of training on the laptops, Becerra said. Each machine will initially be loaded with about 100 copyright-free books. Where applicable, texts in native languages will be included, he added. The machines will also have a chat function that will let youngsters make faraway friends over the Internet."

There are still critics of the program.

"Critics of the rollout have two key concerns. The first is the ability of teachers -- poorly trained and equipped to begin with -- to cope with profoundly disruptive technology. Eduardo Villanueva, a communications professor at Lima's Catholic University, fears 'a general disruption of the educational system that will manifest itself in the students overwhelming the teachers.' To counter that fear, Becerra said, the government is offering $150 grants to qualifying teachers toward the purchase of conventional laptops, for which it is also arranging low-interest loans. The second big concern is maintenance. For every 100 units it will distribute to students, Peru is buying one extra for parts. But there is no technical support program. Students and teachers will have to do it. 'What you want is for the kids to do the repairs,' said Negroponte, who believes such tinkering is itself a valuable lesson. 'I think the kids can repair 95 percent of the laptops.' Tech support is nevertheless a serious issue in many countries, Negroponte acknowledged in a telephone interview."

One important aspect of the One Laptop Per Child project is that the laptops are given to the children not just loaned to them.

"The XO machines are water-resistant, rugged and designed to last five years. They have no fan, so they won't suck up dust; are built to withstand drops from five feet; and can absorb power spikes typical of places with irregular electricity. [Maria Antonieta Mendoza, an Education Ministry psychologist], is overjoyed that the program stipulates that youngsters get ownership of the laptops."

Another interesting thing is happening in homes where children use the XO, adults want to know how they can use the computer to improve their lives.

"Parents in Arahuay are asking Mendoza, the visiting psychologist, what the Internet can do for them. Among them is Charito Arrendondo, 39, who sheds brief tears of joy when a reporter asks what the laptop belonging to ruddy-cheeked Miluska -- the youngest of her six children -- has meant to her. Miluska's father, it turns out, abandoned the family when she was 1. 'We never imagined having a computer,' said Arrendondo, a cook. Is she afraid to use the laptop, as is typical of many Arahuay parents, about half of whom are illiterate? 'No, I like it. Sometimes when I'm alone and the kids are not around, I turn it on and poke around.' Arrendondo likes to play checkers on the laptop. 'It's also got chess, which I sort of know,' she said, pausing briefly. 'I'm going to learn.'"

The project is really just getting started and I'm sure the lessons learned in Peru will be both numerous and surprising. I suspect that Negroponte believes that family lives will improve, not just the lives of children. I also suspect he will be right.

Mapping Connections

Every school child learns that there has been an explosion of knowledge over the last 150 years. Richard C. Atkinson, President of the Nagasaki University of Foreign Studies, asserts, "We are living in an age of unprecedented intellectual discovery, an era in which knowledge doubles every 12 to 15 years in the sciences alone." Aristotle may have been the last man who could claim that he knew most of what was knowable in most areas of learning. Today, it is simply impossible to keep up with new discoveries, even if your specializing. Brian Hindo, writing in BusinessWeek, reports how software is helping people working in similar fields keep track of what is going on ["Mapping the Crowd," 15 November 2007].

"Keeping track of the dizzying proliferation of information in the Digital Age can overwhelm managers, and sizing up potential alliances can be daunting. But getting lost can be a costly setback for those with valuable ideas they want to develop. Maps—specifically, intellectual property maps created by strategic advisers Boston Consulting Group—increasingly are being used by everyone from health-care companies to research scientists. They're deploying them to better manage, and expand, the networks they want to cultivate. By mapping links among people and corporations issuing patents and conducting research on common problems, BCG's software tool can bring to light ways to achieve breakthroughs. Being able to map which scientists communicate—and how often—could help managers focus on new areas of research."

My partner, Tom Barnett, and I have insisted for a long time that good things happen when connections are made. We are also proponents of good visualization. People intuitively understand pictures better than words.

"The BCG mapping software conducts keyword searches of patent and scholarly databases. Unlike other data trawlers, such as Google's patent search, the firm's tool arranges the data in the form of a map with circles and connecting lines, quickly illustrating which organizations are working on similar technologies and which researchers are citing a company's patents. Companies and people show up as circles—the bigger the circles, the greater the amount of work those companies are doing in fields related to the keywords. Research or patent citations are shown on the map as links between circles." [See attached image as an example of what is being described.]

Hindo reports that companies and organizations are using BCG mapping software to help find partners and increase collaboration. He uses a non-profit organization as an example of how this works.

"The Myelin Repair Foundation (MRF), for example, a Saratoga (Calif.) nonprofit, pulls together scientists from various disciplines to research treatments for multiple sclerosis (MS). When MRF founder Scott Johnson, a BCG alumnus, first organized his team of five principal investigators in 2003, he used the network mapper to see how the researchers' work was interconnected. Johnson's team used the software, provided pro bono by BCG, to search medical databases for about 56 different compounds or proteins that are important to MS treatment. The resulting map showed the five MRF researchers and their labs as prominent circles, which represented the many scientific papers they published about the compounds. But there were only a few thin lines connecting the circles, indicating the researchers were largely working alone and rarely citing each other's work. With a topographical view of their interactions, Johnson has pushed the scientists to work together more often. As a result, the latest map shows the intertwined work of Stephen Miller, an immunologist at Northwestern University, and Brian Popko, a University of Chicago geneticist. Their circles didn't connect on the initial 2003 map. But as the current one shows, they're citing one another and co-authoring papers often. 'They've become quite interdependent over the years,' says Russell Bromley, MRF's chief operating officer. 'Brian has ended up having Steve work with him on projects that are more immunological in nature…and Steve has worked with Brian on projects that really are coming out of his genetics work.'"

I'm a big believer in strategic partnerships and alliances. It is a waste of time and effort to duplicate something that someone else is already doing. I pride myself on being able to recognize when another company does something well that complements what my company wants to do. Normally, a win-win situation can be found so that neither time nor resources are wasted. The BCG mapping software helps companies find potential collaborators in places they might not have otherwise looked. That is what MRF uses it for.

"Organizing such a vast array of information in a visual way allows MRF managers, for example, to peek at hard-to-find technologies. MS causes inflammation in the brain and spinal cord, so the team uses the tool to find out what's happening in inflammation research broadly, uncovering the work of unfamiliar scientists in adjacent fields. Without it, Bromley says, the foundation would have to cast its nets the old-fashioned way, asking colleagues haphazardly at conferences or doing a laborious manual search of the literature. He says using the map has shaved years off the process."

That is the power of connectivity in the information age. Hindo concludes his article with another valuable use of mapping involving intellectual property.

"Another kind of payoff may come when an intellectual property map is used to shape strategy. Companies can detect early-stage rivals that are working on new technologies, for example. When BCG deploys the software, one goal is to discover "promising white spaces," or blank areas where clients can find opportunities, says Wendi Backler, who runs the firm's work in intellectual property and networking. BCG used mapping to help a health-care company seeking to grow through acquisitions—the company had identified only one potential target. A search of patent keywords brought up hundreds more that flew beneath the client's radar. Backler recalls another company struggling to grow. It looked at a map of patent activity in its industry and saw a field of circles representing each of its rivals, with lines connecting one another like a constellation. The client showed up as a lonely little dot in the lower corner of the map, like a Facebook user with no friends. The lesson: It was isolated in a networked world."

Connectivity and visualization are extremely important in the information age. Any product that improves both should be a winner. BCG's clients seem to agree.

Giving with Confidence

One last post on this week's theme of charitable giving. When Warren Buffett offered a large portion of his fortune to the Bill & Melinda Gates Foundation, he underscored the fact that donating money wisely (meaning to organizations that will spend it well) is not as simple as one might think. After every major catastrophe, scam artists emerge and set up phony charities. The only people who benefit from those charities, however, are the people who set them up. Stephanie Strom reports that two young, former hedge fund executives have set out to solve that problem for people who want to make sure that their money goes where it can help the most ["2 Young Hedge-Fund Veterans Stir Up the World of Philanthropy," New York Times, 20 December 2007].

"As hedge-fund analysts, Holden Karnofsky and Elie Hassenfeld made six-figure incomes deciding which companies to invest in. Now they are doing the same thing with charities, for a lot less pay. Mr. Karnofsky and Mr. Hassenfeld, both 26, are the founders and sole employees of GiveWell, which studies charities in particular fields and ranks them on their effectiveness. GiveWell is supported by a charity they created, the Clear Fund, which makes grants to charities they recommend in their research. Their efforts are shaking up the field of philanthropy, generating the kind of buzz more typically devoted to Bill Gates and Warren E. Buffett, as charities ponder what, if anything, their rigorous approach to evaluation means for the future."

Karnofsky and Hassenfeld got into the assessment business because they had become relatively wealthy working with a hedge fund and wanted to start giving something back.

"Mr. Karnofsky and Mr. Hassenfeld met at Bridgewater Associates, an investment management company in Westport, Conn., which they joined at roughly the same time. In the fall of 2006, they and six colleagues created what Mr. Karnofsky calls a 'charity club.' Each member was assigned to research charities working in a specific field and report back on those that achieved the best results. They were stunned by the paucity of information they could collect. 'I got lots of marketing materials from the charities, which look nice, you know, pictures of sheep looking happy and children looking happy, but otherwise are pretty useless,' said Jason Rotenberg, a former member of the club and now a $50,000 donor to the Clear Fund. 'It didn't seem like a reasonable way of deciding between one charity and another.' By the end of that year, Mr. Rotenberg and other club members were frustrated, but Mr. Karnofsky and Mr. Hassenfeld soldiered on, at once fascinated and discontented by their inability to get data that would illustrate charities' impact. 'There are huge foundations out there whose job it is to find great organizations doing great things,' said Robert Elliott, a club member who is now the Clear Fund's chairman, 'but when you call them and say you'd like to leverage the information they've already collected to make a smart donation, it's a closed book.'"

In June 2007, I wrote a post entitled Standards and Aid which discussed the establishment of a set of standards that major international charitable organizations had agreed to abide by. Karnofsky's and Hassenfeld's method uses its own criteria to judge the effectiveness of charitable organizations. Although legitimate charitable organizations welcome scrutiny because they believe they are doing a good job, there are concerns that Karnofsky's and Hassenfeld's system doesn't measure all the right things.

"'I think in general it's a good thing,' said Thomas Tighe, president and chief executive of Direct Relief International, an agency that GiveWell evaluated but did not recommend. Like others in the field, however, Mr. Tighe has reservations about GiveWell's method, saying it tends to be less a true measure of a charity's effectiveness than simply a gauge of the charity's ability to provide data on that effectiveness."

One of things often measured about charitable organizations is the percentage of donated funds that goes towards toward overhead instead of being applied against relief or development. The irony is that the more information that groups like GiveWell request the higher the administrative costs of providing that information. Don't get me wrong. Applying standards against which organizations can be measured is a good thing, but the cost of providing that information must be taken into account. It's almost a Catch 22 situation.

"GiveWell's findings are available on the Internet, without charge, at www.givewell.net. In evaluating charities, Mr. Karnofsky and Mr. Hassenfeld press them for information, analyzing the numbers in much the same way they did at Bridgewater. The Smile Train, for instance, a charity that repairs cleft palates, was asked how much it spent in each region and each country to treat how many patients in each. Mr. Karnofsky and Mr. Hassenfeld argue that widely available existing systems for charity evaluation, which rely largely on the charities' tax forms, known as 990s, are basically worthless because charities are given wide latitude in how they classify information. For example, some charities count fund-raising costs as money spent on programs. Charity Navigator, a Web site that rates charities based on their tax forms and has some five million users, is Mr. Karnofsky's particular bête noire. 'I have literally read thousands of 990s, and they tell you nothing about whether a charity helps people,' he said. 'I can tell you exactly how to get a four-star rating on Charity Navigator without doing anything charitable at all.' Trent Stamp, the president of Charity Navigator, is put off by their approach. 'I truly do wish them well,' Mr. Stamp said, 'but the way they're going about it seems a bit counterproductive to me. I'm not sure why they feel the need to tear down those who are also attempting to help donors, nor why they need to tell donors who use those services that they're stupid.' Many in the field question how long GiveWell can survive. While 34 percent of wealthy donors who responded to a survey sponsored by the Bank of America said they wanted more information on nonprofits, almost three-quarters said they would give more if charities spent less on administration. And collecting information is costly."

GiveWell finds itself in a similar Catch 22 situation. Although people want to know which of the many charities out there are worthy of receiving their donation, they don't want to donate to a company that helps them determine how best to donate. Organizations like GiveWell also understandably irritate any charity they don't recommend. It's thankless, if worthwhile, work. One group that could benefit from GiveWell's work (and could afford to pay for it) is the Global Philanthropists Circle ["The Most Elite Club in the World," by Aili McConnon, BusinessWeek, 26 November 2007 print edition].

"It's one of the most exclusive clubs anywhere, which is why you've probably never heard of it. Members come from 68 of the wealthiest families in 22 countries. Many are connected to business dynasties around the world. The point of the club: to give away money so that it has the greatest long-term impact on pressing global issues. 'Most philanthropists, even experienced ones, say that it's harder to give money away effectively than it is to make it,' says Beth Cohen, director of the Global Philanthropists Circle (GPC)."

In yesterday's post [Philanthropy at the Top of the Economic Pyramid], I talked about how the newly sprung super wealthy are trying to use their money for good. The GPC is made up of people with new and old money.

"The GPC is the brainchild of Peggy Dulany, 60, and her father, David Rockefeller, a grandson of Standard Oil founder John D. Rockefeller Sr. While it's common now for philanthropists to partner with one another, Dulany's six-year-old Circle was one of the first to try such collaborations. She recognized early on that philanthropy was becoming more global. Worldwide giving by the superrich reached $285 billion last year, according to a Merrill Lynch/Capgemini study. But with so many big new gifts, there's more waste as philanthropists struggle up a learning curve. Dulany saw a need for an organization that would allow givers around the world to meet, exchange ideas and strategies, and work together to take on increasingly complex issues. Today the Circle's members, who pay $25,000 in annual dues, include such U.S. families as the Hewletts, the Gunds, and Ted and Vada Stanley, newcomers to this year's ranking of philanthropists. Overseas members include the Lopez family, one of the wealthiest Filipino business clans; Marcos de Moraes, a newly minted Internet millionaire from Brazil; and the Benjelloun banking family from Morocco. The chance to socialize with one another is a big part of the GPC's appeal. As befits such an illustrious group, these encounters are often held at Rockefeller family estates. Recent gatherings have included an evening gala at a Park Avenue ballroom. Bill Gates Sr. was a panelist. Glenn Close, a friend of Dulany's who has traveled with her, stopped by. Richard Gere, a former GPC member, skipped this year's event. Every summer the GPC offers a weeklong retreat at Dulany's 9,000 acre Montana ranch. The agenda includes three days of camping solo in the wilderness. Participants can either fast or take along subsistence rations of fruits and nuts to munch on as they meditate on their philanthropic goals. Next spring 40 members will visit a Rockefeller-owned island off the coast of Maine. Shorter sessions are held at the Tudor-style Playhouse on the Rockefeller estate in Tarrytown, N.Y., where members share details of their projects in the morning, followed by tennis or bowling in the afternoon."

The GPC is not primarily a social club, although McConnon details the amazing globetrotting trips the group takes.

"The swanky settings and the chance to mix it up with celebrities raise the question of whether members are in it for the philanthropy or the fun. At their most noble, the GPC and networks like it provide a way for donors to share their successes and learn from one another's mistakes as they wrestle with issues that transcend borders. At their worst, they're a tax-deductible vanity. 'These networks are a great idea if people are serious about it,' says Trent Stamp, president of Charity Navigator, a nonprofit charity evaluator. 'But if it's just an excuse to bring rich people together to network and pursue for-profit endeavors, then they're an expensive waste of time.' The GPC believes that introductions to the world's rich and powerful can turbocharge a philanthropic project. Besides, Cohen says, if a donor is considering putting hundreds of millions into a cause, the fees are a small price to pay. ... Charity Navigator gives the GPC's parent, Synergos, an overall rating of three out of four stars -- administrative costs bar it from top marks. Its fans say that's an outdated measurement that fails to capture the real value of a network like the GPC. Sexwale, for example, says he could never duplicate the networking and access to experts if he were operating on his own. His fellow South African, Appelbaum, echoes the sentiment: 'If I learn about someone else tackling the same problem in a brilliant way, I can fast-track what I'm doing by taking a leaf out of their book. I don't have to reinvent the wheel. Well, that's priceless.'"

There is an immense amount of wealth being donated to non-profit organizations right now. As globalization continues to create new super-wealthy individuals, more opportunities for philanthropy will emerge. I'm encouraged that some of these wealthy donors are seriously considering best practices, taking advantage of lessons learned in the past, and looking for impact rather than name recognition. That impact, however, should be measured in terms of improved and sustainable life styles -- which means education, health, and jobs must be right at the top of those lists.

Philanthropy at the Top of the Economic Pyramid

In a couple of past posts on philanthropy [Prosperity and Altruism and More on Prosperity and Altruism], I discussed how altruism increases along with per capita income. The people discussed in those posts were not the super-rich, like Bill Gates or Warren Buffet, but people who have nevertheless done well as they have been positively touched by globalization and have tried to pass their good fortune along. There are individuals, like Gates and Buffet, who have done extremely well and have reached the pinnacle of the economic pyramid. According to Landon Thomas, Jr., many of these super-rich people are also investing their wealth in philanthropic endeavors ["A New Breed of Billionaire," New York Times, 14 December 2007]. These nouveau riche philanthropists are found all around the world. Thomas begins his article in Turkey.

"Stuck in a traffic jam in his bulletproof BMW, the richest man in Turkey lets loose with a satisfied grin. Since 2000, Husnu M. Ozyegin has spent more than $50 million of his own money, building 36 primary schools and girls' dormitories in the poorest parts of Turkey. Next to the Turkish government, Mr. Ozyegin is the biggest individual supporter of schools in the country — and an official from the education ministry has told him that his market share is increasing. 'Not bad,' he says in his gruff, cigarette-scarred voice as he pockets his mobile phone. 'If I can have an impact on one million Turkish people in the next 10 years, I will be happy.'"

Once people looked only to the U.S., Europe, and Japan to find billionaires, but no longer. Thomas points out that the way these individuals accumulated their wealth is reminiscent of America's so-called "robber barons," who used questionable practices and a lax regulatory environment to dominate their respective industrial sectors and amass huge personal fortunes. Many of these robber barons, like John D. Rockefeller, Henry Ford, and Andrew Carnegie, established philanthropic foundations and established a pattern of altruism that other wealthy donors could emulate. This is what Thomas is seeing happen around the globe.

"The global wealth boom has created a new breed of billionaire in once-destitute countries like Turkey, India, Mexico, and Russia. Propelled by their rising economies, robust currencies and globally competitive companies, they have ridden a surge in local stock markets that have reached previously untouchable heights in a short five-year timeframe. Now, a number of them are using their wealth to bolster their standing and push for social changes. These entrepreneurs, who have made their billions in private sector industries like telecommunications, petrochemicals and finance, are distinct from a past generation of international billionaires, most with ties to Middle Eastern oil or valuable land holdings. Not only have they become the richest men in their countries; they are among the wealthiest in the world. For these emerging economies, where loose regulation, opaque privatization processes and monopolistic business practices abound, this extraordinary and uneven creation of wealth rivals in many ways the great American fortunes made at the turn of the 20th century. While such countries have long been accustomed to vast disparities between a tiny class of the wealthy elite and the impoverished masses, the new elite shares some characteristics with counterparts in the United States. And just as Rockefellers, Carnegies and Morgans once used philanthropy to smooth the rough edges of their cutthroat business reputations — as have a current generation of wealthy Americans that includes Bill Gates of Microsoft and Sanford I. Weill of Citigroup — local billionaires in emerging markets are trying to do the same."

Like Ozyegin, many of these new philanthropists target education. Health issues are another popular cause.

"Carlos Slim Helu, the telecommunications entrepreneur in Mexico who is worth more than $50 billion, has pledged billions of dollars to his two foundations that will aid health and education. Roman Abramovich, Russia's richest man, who has a net worth of $18 billion, has channeled more than $1 billion into the impoverished Arctic area of Chukotka, where he also serves as governor, building schools and hospitals. And in India, Azim Premji, the chairman of the software company  Wipro who is worth $17 billion, has established his own foundation that supports elementary education. ... 'What we are seeing in these countries,' said Jane Wales, president of the Global Philanthropy Forum, 'are people emerging from the private sector with tremendous wealth who are attracted to highly strategic philanthropy.'"

Thomas indicates that many people credit people like Gates and Buffet for providing a model of giving that encourages other wealthy individuals to follow their example. As I pointed out earlier, however, the model was established in the U.S. by the robber barons but philanthropic activity by wealthy families can be traced far back in history. The renaissance, for example, could not have happened without wealthy benefactors supporting artists, philosophers, scientists, and musicians. Most of the newly rich are entrepreneurs, like Mr. Ozyegin.

"Like many self-made billionaires, Mr. Ozyegin has a direct, demanding manner, and a day spent traveling with him does not yield much casual conversation. He carries two cellphones, Throughout a long day he juggles calls from his wife, his assistant, his son and assorted government bureaucrats, as well as the managers of his various businesses. He typically works 11-hour days, not solely from his suite of offices but also from his car, plane or boat, checking in on his far-flung operations in Turkey as well as Russia, Romania and China. 'I'm first generation, that gives me satisfaction,' he said. 'Getting to the top is not so easy; staying there is more difficult.' Mr. Ozyegin's grandparents came to the southern Turkish city of Izmir from the Greek island of Crete in the late 19th century, during the dying days of the Ottoman Empire. The son of a doctor, he attended Robert College, an elite academy in Istanbul, before setting off to Oregon State University in 1963 with $1,000 in his pocket. An overachiever, he played basketball and led the student government, but earned mediocre grades. Harvard Business School seemed like a long shot given that he was in need of a scholarship. But he attached a picture of himself welcoming Robert F. Kennedy to Oregon State to his application and was accepted. 'I guess they liked me for my leadership abilities,' he said. After a successful banking career, he founded Finansbank in 1987, selling his two homes and borrowing $3 million to get the deal done."

Thomas concentrates on Ozyegin because represents all successful entrepreneurs who have seized opportunities presented by globalization.

"As a businessman, his frequent interaction with Southeast Asia, China and Russia has impressed upon him the need for Turks to become more competitive in today’s global economy. 'The most important problem that Turkey has is education,' he said. He cites the rapid increase of applications to Harvard Business School from Chinese and Indian students. Turkey, a smaller country, sends only four to eight students a year, said Mr. Ozyegin, who meets with the students when he visits. Beyond his public school investments, Mr. Ozyegin has plans to spend up to $1 billion over the next 15 years on a new private university, to be called Ozyegin University."

Ozyegin understands, especially because of his banking background, that foreign direct investment can be attracted to countries with healthy and educated populations. It is only after those conditions are met that investors start looking at things like government policies, corruption, transportation systems, and so forth. The reality is that a country with good health and education systems are generally better run than those that don't. Ozyegin is trying to set an example for the Turkish government to follow.

"'I want to do something on a major scale,' he said. 'My vision is that we can train and export people like India does.' Since he started his building program in 2000, Mr. Ozyegin has completed 36 schools and girls' dormitories at a cost that varies from $400,000 to $1.8 million each. He wants to reach 100 by 2010. He works closely with the government, with most of the building taking place in the country’s poorest regions in the south and northeast. 'That is a lot, it is a very significant number,' said Filiz Bikmen, the executive director of Tusev, a philanthropy foundation in Istanbul. Turkey has the lowest ratio of girls to boys in primary and secondary school of any country in the Organization for Economic Cooperation and Development, which requires its 30 members to meet minimum requirements for living standards and democratic practices. Turkey's low standing is a result of a traditional culture that, especially in poorer areas, places a higher premium on a boy’s education than a girl's. In a country where the ruling party draws its root support from an electorate that is becoming more Islamic in attitude and outlook, Mr. Ozyegin's aim to reach out to undereducated girls touches a sensitive cultural vein (through his wife’s foundation, Acev, he has also helped pay for women’s literacy and early education programs in poor parts of the country.) A practicing Muslim but avowedly secular in outlook, Mr. Ozyegin embodies the hopes as well as fears of Turkey’s elite, many of its ranks now supporters of the ruling Justice and Development party, which has led the revitalization of the Turkish economy. Mr. Ozyegin hopes that focusing on education as an economic development tool will help transcend the current bitter disputes over religious practice, including whether the increase in the number of women wearing head scarves signifies the emergence of a more Islamic, less secular Turkey."

Ozyegin has big dreams. He wants Turkey's educational levels to match Europe's within three decades. To achieve that, he is building schools in Turkey's poorest regions, including the Kurdish region. He is giving away two percent of his wealth every month -- a remarkable figure -- to make his dreams come true. As I've noted before, grand visions must be matched by bold actions -- a formula in which Mr. Ozyegin obviously believes.

Merry Christmas

There is something about religious holidays -- no matter one's beliefs -- that seems to bring out the best in people. When it is a holiday like Christmas, with its emphasis on giving to others, it is particularly true. Charles Dickens, famous for writing A Christmas Carol, penned the following:

"I have always thought of Christmas time, when it has come round, as a good time; a kind, forgiving, charitable time; the only time I know of, in the long calendar of the year, when men and women seem by one consent to open their shut-up hearts freely, and to think of people below them as if they really were fellow passengers to the grave, and not another race of creatures bound on other journeys."

So despite your religious affiliation, I wish you peace, faith, and happiness as we journey together as fellow passengers in life.

Thinking of Others this Holiday Season

Similar organizations often have similar objectives. Most governments are formed to "establish justice, insure domestic tranquility, provide for the common defense, [and] promote the general welfare." Almost every organized religion has among its goals some way of taking care of the poor. The reason that people organize themselves is because they understand that they can accomplish more working together than they can working independently. The mega-wealthy have often established philanthropic foundations so that their accumulated wealth can be used wisely to benefit others. It is the accumulation of talent, time, money and so forth that makes a difference. Steve Case, founder of America Online, is trying to convince those who think that the small amount they might be able to donate to a good cause won't make a difference that it truly can ["Foundation Testing Potential of Philanthropy via Internet," by Stephanie Strom, New York Times, 13 December 2007].

"The Case Foundation is embarking on an effort to test the potential of citizen-led philanthropy via the Internet. ... 'Philanthropy shouldn’t be defined as a bunch of rich people writing big checks,' said Jean Case, who founded the Case Foundation with her husband, Steve, founder of America Online. 'Small amounts of money given by large numbers of individuals can be combined to do great things.'"

This, of course, is not the first time someone has tried to collect money using the Internet. What's unique about this effort is the "contest" twist that has been used.

"Starting [13 December 2007], readers of Parade magazine and members of the Causes section of the Facebook Web site can enter a contest to win a total of $500,000 and $250,000, for their favorite charities, provided by Case. The prizes will go to the charities and causes that attract the greatest numbers of unique donors, rather than the one that raises the most money. ... Randy Siegel, publisher of Parade, said he saw the program as 'a wonderful way to give our 70 million readers a firsthand look at how the Internet and technology have revolutionized charitable giving.' The contest is one of a string of efforts by Case to determine what role online technologies can have in the charity field. Parade and Causes are eager to learn from the information gleaned from the contest."

The fact that the charity that attracts the greatest number of "unique" donors wins the money is a great idea. To use a biblical reference, it is making sure the "widow's mite" receives as much credit for good as the wealthy person's millions. To use an eastern religious reference, it's all about creating good karma. Case has been very creative in his pursuit of philanthropic endeavors.

"Last summer, Case asked individuals and small nonprofit groups for ideas to improve their communities, promising to award a total of $300,000 to the proposals chosen by a panel of judges. The foundation has also put money into developing ThinkMTV.com, a networking site aimed at increasing youth activism. And on its own site, casefoundation.org, it offers holiday gift ideas with charitable components, as well as links to the Causes and Parade sites. 'We've always asked how we can leverage our resources to engage a larger population, how can we get the most Americans involved in charitable giving and action,' Ms. Case said."

In my discussions of Development-in-a-Box™, I have talked about the importance of communities of practice and getting local groups involved in decision making. Case's approaches to philanthropy apply some of those techniques. He is reaching out in novel ways. The results, to date, have been modest but so were the goals of those who started the effort.

"The amounts raised through new technologies and online networks have been modest. The top “cause” listed on Causes, support for breast cancer research, has attracted 2.8 million members, raising an average of 2 cents a member, or a total of $52,240, for Brigham and Women's Hospital. Proponents say the Internet has been useful in attracting people to sign petitions and attend rallies and demonstrations, if not in generating big donations. 'The tools and technologies are still evolving, and we're still trying to figure out how it works,' said Beth Kanter, an expert on nonprofits and technology. Sean Parker and Joe Green, founders of Project Agape, the start-up that created the Causes application, said their primary goal since Causes went live in May has simply been to prove it could attract millions of users. 'Now the question is how do we take this social platform we've built and encourage more kinds of action using it,' Mr. Green said."

Philip Rucker, covering this same story for the Washington Post, underscored that this is not the first attempt at raising online philanthropic contributions ["Twin Efforts Aim to Popularize Online Giving," 13 December 2007].

"These are not the first experiments with online philanthropy, but observers said they are the most sweeping. This year, actor Kevin Bacon and the nonprofit Network for Good launched the SixDegrees.org campaign to get people to donate online and solicit donations from friends. After natural disasters such as the Asian tsunami in 2004 and Hurricane Katrina in 2005, thousands of Americans donated to relief organizations through the Internet. This fall, when wildfires ravaged Southern California, the rock band Linkin Park helped raise money through musicforrelief.org."

Rucker provides additional information about the programs being launched by the Case Foundation.

"In the efforts launching [13 December], two nonprofits, Network for Good and GlobalGiving, have partnered with the Case Foundation. Both groups have secure online databases with lists of organizations, including financial information, to help potential donors pick a charity. GlobalGiving, based in Washington and founded by two former World Bank executives, allows people to find charities by country, theme and cause. Donors will receive online updates 'from the field,' including videos and photos, to see how their money is being spent, said Dennis Whittle, the organization's founder and chief executive. Traditionally, donors send money to charities by mailing a check, and charities bestow the most attention on the most generous givers. But, Whittle said, new technology has the potential to make 'all donors equal in the eyes of philanthropy.'"

One of the things I like about the new Case initiative is that the donor gets to choose the cause and gets to feel good about his or her contribution regardless of the amount because it is the simple act of giving that is counted. Last week, NBC's Today Show filled a side street near its New York City studios with a million dollars worth of pennies collected from school children across America for charitable causes. The point being made was that a pattern of giving should be developed in children so that it becomes a life-long habit. The holiday season is a traditional time to think about giving to others. I would like to add my voice in encouraging you contribute to the well-being of others. Recent studies have demonstrated that doing good can make you feel good -- releasing the same chemicals that make other activities pleasurable. Like Steve Case and others, I'm not concerned about the amount you can afford to contribute but would like to encourage you to establish a pattern of giving. If you don't have money, you can contribute time and talent. You can regularly work in a soup kitchen, man a Salvation Army kettle, help care for an elderly neighbor, tutor a student, be a driver for Meals-on-Wheels, volunteer with the Red Cross, and so on. There are endless ways to help others during this holiday season and throughout the year.

Beyond Abu Ghraib

You generally have to watch old war films on the Turner Classic Movie channel to see one in which the military is shown in a positive light. More often, the military is portrayed in movies as a large, mindless organization with questionable ethics. The scandal uncovered at the Abu Ghraib prison and all the press coverage about prisoners detained in Guantanamo Bay, Cuba, with limited legal rights certainly does nothing to enhance the military's image. From my contacts with military personnel, however, I know that the military's image is often distorted. It was, therefore, good to read a story that focuses on the positive impact that a true military professional can have when he is placed in a similar situation ["Iraq's 'Battlefield of the Mind'," by Walter Pincus, Washington Post, 10 December 2007]. Pincus' article focuses on the efforts of Marine Maj. Gen. Douglas M. Stone to improve the effectiveness of U.S.-run Iraqi detention centers.

"Marine Maj. Gen. Douglas M. Stone, commanding general of detainee operations in Iraq, is fighting what he has called 'the battlefield of the mind.' He has instituted extensive screening of incoming prisoners and has made available about 30 training and education courses, including religion and civics, to the 25,188 prisoners under his control."

Stone's approach is certainly a more enlightened one than the earlier approach that intimidated detainees with dogs and humiliated them by stripping them in front of women and other detainees.

"At a news conference, ... he said that once a person is in custody at his facilities, Camp Cropper near Baghdad and Camp Bucca in southern Iraq, 'we spend a lot of time learning about them now, studying their motivations ... why they're fighting, who they fight for -- more so than we've ever known before.' At Cropper and Bucca, he said, there is 'an assessment phase, and we take 72 hours and then we work really hard on categorizations.' Based on those assessments, which include having imams evaluate prisoners on their religious beliefs, a decision is made about where to house them in the detention facility. ... Stone said the compounds are not organized by geographical areas, so most prisoners 'don't really know each other.' Because extremists are 'generally the guys that know each other ... and they come in to set up kind of a gang court,' people from the same areas are spread out across the prison."

One of the lessons learned in the aftermath of the genocide in Rwanda is that the bad guys are often the best organized. In refugee camps set up in Rwanda and surrounding areas, perpetrators of the genocide used intimidation and organization to run the camps. Although detainees and refugees have different backgrounds, needs, and challenges, there are some similarities about how to deal with groups of people. A vetting process that separates the worst elements from others (in this, case insurgents) is important.

The heart of Stone's approach is education. Conspiracy theorists will probably see some sort of Manchurian Candidate scenario being unfolded, but Stone wants people to leave his facilities better prepared to contribute to Iraq's future.

"The courses they take, almost all of which are voluntary, include basic education, vocational training and religion. The religion course, run by one of 43 imams working on the program, lasts four days. The civics course, which each detainee must take before he is released, covers 'why you should try to get an education -- why you should try to have a job,' Stone said. Other courses touch 'on how you control anger, the oath of peace, the sacredness of life and property and references back to the Koran,' he added. The demand for classes has 'stripped' the 150 teachers he has available. 'I don't change people,' Stone said. 'Those people or God changes them, not me, but we do set in motion the ability to have that change take place.'"

As a military professional, Stone's first concern, of course, is security. He believes that winning the battlefield of the mind is key to making Iraq a more secure place. For him, the battle begins within the wire fences of the detention centers.

"Stone sees the overall program as working with detainees so that 'they cannot conduct an insurgency inside the wire.' He added that he hopes that detainees 'someday maybe even work with us and, of course, by telling us who the bad guys are.' One result already seen, he said, is that moderates in the prisons are identifying extremists, thus facilitating their segregation from the rest of the population. At Camp Bucca, about 1,000 extremists were identified and pulled from among the 21,000 prisoners, and 'that made a big difference,' he said."

The vocational training Stone provides is important, but it will only contribute to sustainable security if accompanied by a job creation program. If people leaving detention find themselves thrust back into a situation where they have no job and no hope of getting one, they once again become part of the potential pool of insurgent recruits. I discussed this topic in more detail in the post entitled Dealing with Iraq's Great Depression. Although the military has tried for some time to convince its political masters that creating jobs is a matter of security, policymakers have only recently seen the light. Jobs equal hope and good jobs generate self-esteem as well as people who hold a stake in the future. The projects that Enterra Solutions is undertaking in Iraq all have job creation as one of their primary goals. Successful Iraqi companies will not generate profits for themselves but will profit the entire country. A good job is the real peace dividend for which most Iraqis are looking.

Corruption, Vulture Funds, and the Future of Africa

A recent article (perhaps in BusinessWeek) talked about people who had been declared legally bankrupt and yet found themselves having to pay debts they believed had been cancelled by the courts. These people faced two different groups looking for money. One group included companies that offered the original credit and that refused to delete the debt from credit reports even after receiving court orders demanding they do so. The result was that people after bankruptcy looking to make purchases on credit, like a house, found they couldn't get a mortgage unless the old debt was cleared. Rather than fighting for years in the courts, many paid up. Eventually, these companies were taken to court and ordered to pay large fines, but for many consumers the damage was done. The other group looking to collect from people declared bankrupt involved companies that buy bad debt and then try to harass people into paying. Like most debt collection companies, these companies can make life miserable. This latter group has a parallel in the international lending system and these so-called international "vulture funds" were the subject of a New York Times article ["Unlikely Ally Against Congo Republic Graft," by Lydia Polgreen, 10 December 2007]. Polgreen begins her article by describing the conditions in a Congolese hospital.

"The main teaching hospital [in Brazzaville] is in such disrepair that many patients have to pay freelance porters for piggyback rides up and down the stairs to get X-rays. It costs $2 a flight, each way. But why is the hospital, like so much of the Congo Republic, so tattered when the country sells billions of dollars of oil each year?"

It's a rhetorical question. The answer, of course, is corruption. The government, however, offers many other excuses for why things aren't going well.

"The government says it is still recovering from a devastating war and faces a new problem: Western investors, sensing a chance to rake in millions, are suing to recover old debts that they bought for pennies on the dollar. Such investors, running what critics derisively call vulture funds, have been widely denounced by the World Bank and the International Monetary Fund for forcing poor countries to fend off costly lawsuits rather than build classrooms and clinics."

So why would Polgreen call these vulture funds "allies" in the fight against corruption?

"In the Congo Republic, where a deep-seated culture of graft has squandered so much of the nation’s wealth, those investors have become unexpected allies of anticorruption campaigners, who say such lawsuits may be the only way of holding the country accountable for how it spends its money. 'We ask ourselves, why is our country like this?' said Dr. Bebene Bondzouzi-Ndamba, a neurologist at the hospital. 'Why are we so rich and yet so poor?' Her questions have come into sharp relief in the fight between the Congo Republic and an affiliate of an American hedge fund, Elliott Associates. For an undisclosed price, the company bought about $31 million in debt that the country took on in the 1980s but later defaulted on. Now it is suing in American, European and Asian courts to collect the principal plus interest and penalties — more than $100 million in all. So far, it has collected $39 million."

As Polgreen reports, such activities make people -- like U2's Bono -- cringe in horror or explode with anger. Activists are often joined by politicians in their revulsion.

"Advocates of canceling third world debt recoil at such cases, with some calling for a code of conduct among lenders to prevent them from selling unpaid debts to investors. 'I deplore the activities of so-called vulture funds that seek to profit from the debts owed by the poorest countries,' Gordon Brown said in May, the month before he became prime minister of Britain. 'I am determined to limit the damage done by such funds.' ... Critics argue that virtually all countries use their debt relief savings to help the poor, and that so-called vulture funds achieve outsize returns from long-forgotten debts at the expense of the world’s poorest people."

Clearly this is a story with two sides to tell. The reason that those fighting corruption see vulture fund lawsuits in a different light is because lawyers for those funds are able to expose deeply hidden conspiracies of corruption that otherwise may never have seen the light of day.

"Organizations that fight corruption argue that those investors are exposing in court the corrupt networks of government officials, providing a much-needed check on mineral-rich states. Beyond that, anticorruption campaigners, like the groups Global Witness and the Publish What You Pay Coalition, contend that when nations win debt relief without becoming more accountable, they will simply repeat old mistakes and end up deep in debt once again. 'If it were not for these vulture funds, we would not know any facts about the way our country's wealth is being taken away,' said Brice Mackosso, a campaigner for greater transparency in the Congo Republic's government. 'We don't agree with their ultimate aims, but they are the only ones capable of exposing the truth.'"

In other words, anti-corruption fighters have made what they feel is a deal with the devil. In a perfect world, there would be both debt relief and transparency. One of the reasons I keep pushing Enterra Solutions' Development-in-a-Box™ approach is that it is founded standards and best practices and relies on process automation that provides efficiency, effectiveness, and transparency. The problem with a litigation approach being pursued by the vulture funds is that often the only lesson being learned by corrupt officials is that they have to do a better job of covering their tracks.

"While investor lawsuits may expose nefarious dealings, they may also make governments more secretive to avoid asset seizures. 'It can cut both ways,' said Mark Thomas, a senior economist at the World Bank. 'It can be a cause of revealing nontransparent practices, but it can also be a cause of those nontransparent practices in the first place.'"

Polgreen points out that debts are bought and sold all the time. The reason that vulture funds are willing to buy bad debt for pennies on the dollar is because the upside profits can be very large making the risks worth taking.

"Peru is the best-known example: In 2000, Elliott Associates ...won a $58 million judgment on debt it had bought in 1996 for $20 million."

That's a pretty good return on investment which makes bad debt an opportunity that someone is going to exploit. The big question is what kind of damage will such debt collection activities wreak among the world's poorest nations, especially those in Africa.

"Now African countries are in the sights of debt investors. In 1979, Zambia borrowed $15 million from Romania to buy agricultural equipment. Twenty years later, the two governments agreed to settle the old debt for about $3 million. But a hedge fund, Donegal International, bought it first and sued for about $55 million. This year, a British court ruled that Zambia must pay Donegal $15 million. The plight of Zambia, a poor country stricken by AIDS, raised awareness of so-called vulture investing in Africa, and debt relief campaigners, celebrities and some members of the Bush administration have taken up the issue."

I have written a couple of posts this year describing the halting progress that is being made in Africa. Even in the Congo, there has been some progress -- but not nearly enough.

"Government officials here point to a slew of new projects under construction, like a hydroelectric dam, hundreds of miles of new roads and an emergency power plant as evidence that they are rebuilding the country. A June report from the I.M.F. noted that at least some progress has been made to address 'corruption and weak governance.' Still, half the nation's population lacks access to clean water, according to Unicef. The lifetime risk of dying in childbirth for women in the Congo Republic is 1 in 26, one of the world's highest rates. Life expectancy is just 53 years, down from 55 in 1990. That deprivation exists despite the significant amount of oil the country produces relative to its 3.8 million people — 250,000 barrels a day. The litigation surrounding the country has unearthed a complex web of questionable practices that may have stripped untold millions of that oil money from the nation's treasury since 1997. In interviews, officials here said the purpose of their complex transactions — which, according to court documents, included discounted prices for well-connected companies — was to avoid what it viewed as overzealous creditors. 'We are in a war, and we have to defend ourselves,' said Alain Akouala, the Congo Republic's information minister. But the group Global Witness has seized on court records to tease out these connections between government officials, private companies and a French bank that set up oil transactions. The litigation has also exposed the free-spending habits of government officials. According to hotel bills, the country’s president, Denis Sassou-Nguesso, paid $8,500 a night for a triplex suite at the New York Palace Hotel during a visit to the United Nations in 2005. His hotel bills in the United States in 2005 and 2006 added up to hundreds of thousands of dollars. Officials here said that Mr. Sassou-Nguesso was simply staying in the same type of hotels as other heads of state. Another embarrassing find was the credit card bills of one of the president’s sons, Denis Christel Sassou-Nguesso, who runs the marketing arm of the Congo Republic's state oil business, Cotrade. They showed large purchases from shops like Christian Dior, Louis Vuitton and Gucci, and a paper trail suggesting that companies receiving state oil business had paid for the purchases, Global Witness said. The world of luxury implied by those credit card bills is emblematic of the vast gap between the country’s elite and its impoverished masses."

Caught between the Congo's corrupt leaders and the vulture funds pursuit of bad debts are poverty-stricken masses who are negatively affected by the fight over money because they never benefit from it. As Polgreen reports:

"Caught in the middle of this fight are schoolchildren, like 10-year-old Laurent Mbemba in Pointe-Noire. His school has 3,583 students. Its three latrines are broken. Many teachers have not been paid in years — they get by on donations from parents. Rain pours in thundering sheets onto the tin roof, dribbling through rust holes onto the children beneath. The classrooms are so packed — as many as 200 a class — that many children sit on the cement floor, notebooks perched on their narrow thighs."

The struggle between corrupt leaders and vulture funds is one in which there is no good side to which one can happily lend support. The development community is on the side good governance, transparent processes, and wise investment. Those are not goals being sought by either corrupt leaders or vulture funds.

Turkish Raids on PKK should Come as No Surprise

Over the past few days, Turkey has executed several air and ground raids against the Kurdish rebel group PKK (which has been widely condemned as a terrorist organization). This probably wouldn't have made much of a splash with U.S. news agencies were it not for the fact that the PKK camps are located in Kurdish region of northern Iraq. The Turks have been threatening such raids for months (see my posts Despite Advances, Kurdistan Sits in Shaky Neighborhood, The Kurdish Situation Intensifies, and Internecine Challenges in Kurdistan). The other reason that these raids made the news in the U.S. was the apparent complicity of the U.S. military, which reportedly provided the Turks with actionable intelligence. Complicit or not, the U.S. has certainly made it clear that it supports Turkish efforts to defend itself. The Bush administration made this clear following airstrikes earlier this month ["U.S. Backs Turkey's Anti-PKK Strikes," by Umit Enginsov and Burak Ege Bekdil, Defense News, 10 December 2007].

"U.S. support for Turkish airstrikes against separatist Kurdish militants inside Iraq in early December is seen as a concrete step toward putting back on track the Washington-Ankara relationship, derailed mainly by disputes over Iraq. The Turkish military announced Dec. 1 it had hit a group of 50 to 60 militants from the Kurdistan Workers Party (PKK) in northern Iraq earlier in the day, inflicting 'significant casualties.' U.S. officials were quick to back the operation. 'Turkey has a right to defend itself against terrorists, and any decision to use military action is the decision of the Turkish government,' Lt. Col. Almarah Belk, a Pentagon spokeswoman, said hours after the attack. 'The United States has been working closely with the Turkish and Iraqi governments to seek ways to find a long-term solution to the PKK issue, and this will continue.'

'According to our best information, the targets of the Turkish strike were PKK terrorists and infrastructure, not the Kurdistan Regional Government or civilians or villages,' said Chase Beamer, a spokesman for the State Department’s European bureau. 'We support Turkey’s efforts to defend itself from the PKK terrorism. As President [George W.] Bush said, the PKK is an enemy of Turkey, Iraq and the United States.' Relations between the two NATO allies fell to their lowest point in recent years when Turkey threatened in October to send its military into northern Iraq to fight the PKK."

The Iraqi government, of course, takes a dimmer view of these raids, just as would the U.S. if Canada made a bombing run on U.S. territory to attack a rebel group hiding in North Dakota ["Iraq condemns Turkish airstrikes in northern Iraq," Associated Press, USA Today, 18 December 2007].

"Iraq's parliament condemned the bombing of suspected Kurdish rebel bases by Turkish jets — an attack that seemed to carry tacit U.S. approval — and denounced the raid as an outrageous violation of Iraqi sovereignty. As many as 50 Turkish fighter jets were involved in the airstrikes Sunday in the Qandil mountains of northern Iraq in the biggest attack against Turkish Kurd rebels in years, Turkish media said. An Iraqi official said the planes attacked several villages, killing one woman. The rebels said two civilians and five rebels died. 'We condemn this outrageous attack on Iraq's sovereignty,' Iraq's parliament said Monday in a statement. Turkey said the attack was aimed at rebels of the Kurdistan Workers' Party, or PKK, and that U.S. intelligence had been used in the bombing. The PKK has battled for autonomy for southeastern Turkey for more than two decades and uses strongholds in northern Iraq for cross-border strikes."

The United States sits uncomfortably between three allies in this situation. Stated Bush administration policies against terrorism make it impossible to condemn Turkey for its actions; yet at the same time, it is trying to bolster the authority and confidence Iraq's central government and maintain good relations with the Kurdistan Regional Government (KRG).

"Washington is trying to balance support for two key allies: the Turkish government and the Iraqi Kurds. Despite their apparent support for a limited raid, the United States remains firmly opposed to any major Turkish military operation into northern Iraq — which could disrupt one of the calmest areas of Iraq and run the risk of destabilizing the entire region. In Washington, a Pentagon official said the U.S. military had 'deconflicted the air space' in Iraq for the strikes — that is, the U.S. made sure Turkey would have clear use of the skies to enable the bombings. Another Pentagon official said the U.S. military has been sharing intelligence with Turkey, but that he did not know exactly what information was given to aid with the airstrikes or when it might have been given. Both officials spoke on condition of anonymity as they were not authorized to speak on the record. Iraq's foreign minister, Hoshyar Zebari, said the Iraqi government had thought Turkey would coordinate with Baghdad before striking the rebels inside Iraq. He also indicated that civilian casualties showed Turkey had not hit the right targets. 'What happened yesterday was based maybe on misinformation,' Zebari said. Masoud Barzani, leader of the autonomous Kurdish region in northern Iraq, issued a statement condemning the attacks, which he said were 'conducted with indirect U.S. approval, as defending the sovereignty of Iraq and the Kurdish region is within the Americans' responsibilities.' The State Department declined to offer any judgment on the airstrikes, but said the PKK was a threat that needed to be dealt with in a coordinated way by Turkey, Iraq and the United States."

Turkey followed it airstrikes with a ground incursion yesterday. Secretary of State Condoleezza Rice who was in Iraq at the time of the raids expressed concern about any Turkish military operations that could destabilize the autonomous Kurdish region ["Turkey's raids against Kurdish Rebels Unsettle Iraq," by Scott Peterson and Sam Dagher, Christian Science Monitor, 19 December 2007].

"While the US lends some support to increased Turkish pressure on Kurdish rebels in northern Iraq, Secretary of State Condoleezza Rice warned Tuesday against 'anything that threatens to destabilize the north.' Turkey's cross-border raids to strike at the Kurdistan Workers' Party, or PKK, continued Tuesday as 300 troops entered Iraq overnight. On Sunday, at least 10 jets struck Iraqi villages in the largest attack against the separatists in years. If this pattern continues and a new front opens in the Iraq war, the instability that Ms. Rice spoke of could not only unsettle a relatively calm northern Iraq, but jeopardize already troubled efforts toward national reconciliation. Iraqi Kurds, many of them sympathetic to fellow Kurds of the PKK, condemned the Turkish moves, and Washington's apparent green light. US forces opened up Iraqi airspace, and reportedly provided real-time targeting intelligence to NATO-ally Turkey regarding the location of PKK militants. Analysts say the attacks will have more negative political impact than positive military results, and will further increase tensions in Baghdad between Iraqi Kurdish, Shiite, and Sunni parliamentarians who are struggling to overcome many political differences rooted in sectarianism. But in Turkey, pressure has grown on Prime Minister Recep Tayyip Erdogan to act, as PKK attacks since the late summer have surged against its troops and civilians."

As I've noted in most of my past posts on this subject, none of the governments involved want to destabilize northern Iraq. The economic boom taking place in Kurdistan is dependent on maintaining good relations with Turkey and keeping the Turkish border open for trade. The Turks nevertheless want to keep military pressure on the PKK while the KRG want to pursue a diplomatic and political solution. For its part, the Iraqi central government wants to be kept in the loop so that its authority in this matter is not questioned. The U.S. would just like to see the whole situation go away. The KRG Prime Minister was so upset over the airstrikes and raids (and so convinced the U.S. aided the Turks) that he refused to meet with Secretary Rice during her visit. There is much to be lost and little to be gained by a conflict in northern Iraq. The key to solving the situation, however, is the PKK and it has shown little interest in changing course. I'm convinced that even as political posturing takes place cooler heads will prevail and development in the Iraq's Kurdish region will continue apace.

Chasing the Dream -- in China

Despite all the tough talk being spouted by U.S. presidential candidates about cracking down on illegal immigration, there are still millions of immigrants dreaming of a better life in the United States. Although America's open-arms days of "Give us your poor, your tired, your huddled masses longing to be free ..." are a thing of the past, America is still the preferred destination for most of the poor, huddled masses looking for a brighter future. It is not, however, the only destination of which people dream. Where one lives has much to do with the location envisioned in one's dreams. Where once the U.S. was the preferred location for European and Asian immigrants, it is now the preferred location for Latino immigrants. East Europeans and North Africans are more likely to see "old Europe" as their destination of choice. With increasing frequency, however, people see China as the new land of opportunity. Washington Post Foreign Service writer Stephanie McCrummen, for example, reports that many people living in Chad dream of a better life in China ["Struggling Chadians Dream Of a Better Life -- in China," 6 October 2007]. One reason they dream of China rather than Europe or America is that the Chinese are moving into Africa in a big way looking for natural resources and they are not shy about throwing their money around. McCrummen begins her article in a small store in rural Chad.

"It was midmorning in one of the poorest countries on earth, and the daily traffic of battered trucks, motorcycles and donkeys bounced along the lumpy sand streets of this hot desert town [named Abeche]. Behind the white archways of the old colonial market, Abdulkarim Mahamat, 24, was selling soap and batteries to the few customers who dropped by. Things were rather slow, and the young man explained how he often imagines himself elsewhere -- flying off to a promising new land of cheap socks and smoothly paved roads. 'If I can go to China, life will be better than it is now,' he said, adding that he has started saving up for his ticket. 'I'll make a lot of money, and life will change. I can return to school, build a nice house and have a family. People say that China is a good place and everything is cheap.' As resource-hungry China cultivates relationships with countries across Africa -- most recently here, for oil -- African leaders are debating the merits of that growing influence. Skeptics are troubled, for instance, by China's role in enabling governments such as Sudan's, which is accused of carrying out a brutal campaign of violence in its western Darfur region. But as that debate goes on, something less tangible is happening on the ground, even in this remote, conflict-ridden region where electricity and plumbing are still luxuries: The idea of China as a symbol of potential prosperity is taking hold, seeping into the consciousness of ordinary Africans and occupying a place that the United States, and to some extent European countries, once claimed. Around here, the American dream is something quaint and unrealistic, while a new kind of Chinese dream, more pragmatic and attainable, seems ascendant."

Another person interviewed by McCrummen, provided a different and intriguing insight.

"The United States is a nice place to visit," said Ahmet Mohamet Ali, a trader who had just returned from his first trip to China. "China is a place to do business."

To people like Mr. Ali, America is the home of Disney World, New York City, and the Grand Canyon. China is the place with a growing economy, a pot of foreign equity, and the desire to cement relations with African businesses. Africans don't have visit China to come to that perception; they simply have to look around their own country.

"Besides massive road projects, oil contracts and other deals China has struck across the continent, there are smaller signs that the country is beginning to penetrate African societies. On Fridays in the Congolese capital of Kinshasha, for instance, a reliable line forms at the gates of the Chinese Embassy's visa section. In the Kenyan capital of Nairobi, it is relatively easy to find university students heading off to China for business or language courses. Rebels in Ethiopia's Ogaden region deemed China's influence significant enough to target a Chinese-run oil facility there this year. Here in landlocked Chad, the notion of China is still rather nascent, as the government only last year fulfilled China's prerequisite for doing serious business, recognizing China and severing ties with its rival, Taiwan. Since then, huge oil exploration projects have gotten underway, and Chinese money has flowed into government coffers, leaving some Chadians wondering whether they will benefit from the new wealth. At the same time, a kind of excitement and curiosity about China has trickled down."

Because of Africa's colonial past, there are few cultural shocks when Africans do business with Westerners. The same is not true when doing business with China.

"Here and there, Chadians have been hired by Chinese companies, leading to their first, awkward encounters with a foreign culture. 'They eat dogs and snakes,' said Mustafa Mohamed, who worked a two-way radio for a Chinese oil company, taking lunch orders. 'They are strange people.' Mohamed eventually met some Chinese businesspeople, though, and is now pinning his hopes on exporting precious stones to China. He walks around with a notebook, the words 'Great Stones' underlined on a page with potential prices listed."

More often, however, people in Africa perceive China as a land of opportunity because store shelves are stocked with Chinese products -- just like store shelves in America. There are also occasional reports from neighbors returning from trips to China. Like modern Marco Polos, they regale their friends with tales about the grandeur, hospitality, and wealth of China. My partner Tom Barnett and I have both made numerous trips to China and we can testify that when Chinese officials want to impress and spoil you they certainly can.

It is not just Africans, however, who are dreaming of a better life in China. Another Washington Post Foreign Service writer, Ariana Eunjung Cha, reports that emigrants from a lot of places see China as a destination of choice ["Chasing the Chinese Dream," 21 October 2007]. Cha begins her article with the story of an Iraqi who is fulfilling his dream in China.

"For more than three years, Khaled Rasheed and his family spent the nights huddled in fear as bombs exploded near their home in Baghdad. Like generations of would-be emigrants before him, he dreamed of a better life elsewhere. But where? Finding a place that was safe was Rasheed's top priority, but openness to Islam and bright business prospects were also important. It wasn't long before he settled on a place that had everything he was looking for: China."

Besides opportunity, what is attracting people to China is tolerance. Listen to any U.S. presidential debate and you will find tolerance in short supply. Latino and Muslim immigrants feel especially unwelcome in America. The same is not true in China.

"For a growing number of the world's emigrants, China -- not the United States -- is the land where opportunities are endless, individual enterprise is rewarded and tolerance is universal. 'In China, life is good for us. For the first time in a long time, my whole family is very happy,' said Rasheed, 50, who in February moved with his wife and five children to Yiwu, a trading city about four hours south of Shanghai."

I'm sure that members of the Falun Gong don't perceive "tolerance as universal," but that has more to do with internal Chinese politics than economic prosperity. Besides, the Chinese don't exactly welcome immigrants with open arms. Only if they arrive with business plans (meaning they intend to create Chinese jobs) and money, are Chinese officials open and tolerant. Cha writes:

"While China doesn't officially encourage immigration, it has made it increasingly easy -- especially for businesspeople or those with entrepreneurial dreams and the cash to back them up -- to get long-term visas. Usually, all it takes is getting an invitation letter from a local company or paying a broker $500 to write one for you. There are now more than 450,000 people in China with one- to five-year renewable residence permits, almost double the 230,000 who had such permits in 2003. An additional 700 foreigners carry the highly coveted green cards introduced under a system that went into effect in 2004. China's openness to foreigners is evident in the reemergence of ethnic enclaves, a phenomenon that hasn't been seen since the Communist Party came to power in 1949. Larger and more permanent than those frequented by expatriate businessmen on temporary assignment, the new enclaves evoke pre-revolutionary China, where cities such as Shanghai bustled with concessions dominated by French, British and Japanese. The Wangjing area of northern Beijing is a massive Koreatown, complete with groceries, schools, churches, karaoke bars and its own daily newspapers. A few miles away, in the city's Ritan Park, signs in Cyrillic script and vendors speaking Russian welcome people from the former Soviet republics. In Yiwu, a city in the eastern province of Zhejiang that is the home of the world's largest wholesale market, 'Exotic Street' lights up at night with stands filled with smoking kebabs, colorful hookahs and strong sugared tea for the almost exclusively Arab clientele."

The number of immigrants with which China is dealing is miniscule compared to the challenge faced by the United States (which also might help account for Chinese tolerance); but the trend vector is pointing in the direction of openness and that openness has spurred emigrant dreams. Cha also reports that China's immigration policies are calculated to support its foreign policy.

"Today, its efforts to woo developing countries are driven by more calculated, strategic goals, most notably its need to secure long-term contracts for oil, gas and minerals to fuel its booming economy. As part of this campaign, China has sought to portray itself as more open to Islam than other non-Muslim nations. Over the past 20 years, the government has gradually allowed its own Muslim minority to rebuild institutions that were devastated by state-sponsored attacks on Islam during the Cultural Revolution. Islamic schools have opened, and scholars of Islam are being encouraged to go abroad to pursue their studies. Unlike Christians, China's estimated 20 million Muslims are considered an ethnic minority, a status that confers certain protections and privileges."

Another way that China reaches out to countries of interest is through the provision of scholarships.

"One prong of China's efforts to strengthen ties with the developing world is scholarships, a program that began in 1949 when the People's Republic was founded but that has been ramped up aggressively in recent years. In 1996, China offered about 4,200 scholarships. Last year, the number was 8,500. Among the recipients are children of the elites in countries where China hopes to forge friendships. Salissou's father, for instance, works in Niger's presidential protocol office; Niger is rich in uranium, which China needs for its nuclear plants. Benjamim Amade, 21, who is pursuing a bachelor's degree in public administration at Xiamen University, heard about the scholarships through his uncle, an ambassador for Mozambique, where China buys timber it needs for construction. The students' interest in China is fueled by the rags-to-riches stories of self-made entrepreneurs."

Not only do such scholarships expose potentially important foreigners to Chinese culture they ensure that Chinese becomes a second language for them. Both of those things are important for developing future business relationships. Again the numbers are small when compared to the number of foreigners being educated in the United States, but the trend is headed in the right direction. Cha concludes her article by reminding her readers that China is far from an open society.

"There are limits to China's welcome. It's nearly impossible for foreigners who don't have Chinese ancestry to obtain citizenship, and like anywhere else, China has had its share of racial misunderstandings and clashes with foreigners. The most infamous took place in the city of Nanjing in 1988, when a dispute between a campus security guard and two African students degenerated into a fistfight and ended with African students seeking refuge at their embassies after fleeing a mob that was shouting 'Kill the black devils!' Tensions within China's black community rose again recently after police arrested about 30 African and Caribbean men in an anti-drug operation in Beijing on Sept. 22. Some witnesses accused China of racial profiling and claimed that some men were beaten. Beijing's Public Security Bureau has denied race was a factor in the operation. In Yiwu, there was anger in the Iraqi community after an Iraqi man, Mostafa Ahmed Alazawi, was found dead in his rented home on March 30. His family wanted him to be buried in China and applied to the city for a piece of land. The city ruled that foreigners could not be buried in China, forcing the family to ship the body back to Iraq."

Immigration is going to become an increasingly emotional issue around the world including in China. It is an issue in Europe, in the U.S., in Japan, in Singapore, etc. Any place that is prosperous and looks like a location where opportunities abound will attract economic immigration (both legal and illegal). China is just beginning to feel the impact in this area that comes with being economically successful. Globalization's success rests in some measure on the ability of workers to move freely about the globe, but it rests even more on creating jobs where they are most needed. The hope of the development community, of course, is that enough economic opportunities can be created around the world that unwanted immigration doesn't have to occur. That is a dream so far in the future, however, that only those most visionary of people see it. Nevertheless, it is a dream worth pursuing.

China's Educational Philosophy

Debates about the American education system abound. President Bush touts his "No Child Left Behind" program. Others push for school vouchers so that parents can take their children out of the public education arena and put them in private schools. Still others home school. The reality, however, is that there will always be tension in a system that tries to educate everyone and, at the same time, tries to help gifted students reach their potential. New York Times columnist David Brooks reports that China suffers from no such tension in its educational system, which was designed to identify and educate the intellectually elite ["The Dictatorship of Talent," 4 December 2007].

"Let's say you were born in China. You're an only child. You have two parents and four grandparents doting on you. Sometimes they even call you a spoiled little emperor. They instill in you the legacy of Confucianism, especially the values of hierarchy and hard work. They send you off to school. You learn that it takes phenomenal feats of memorization to learn the Chinese characters. You become shaped by China’s intense human capital policies. You quickly understand what a visitor understands after dozens of conversations: that today's China is a society obsessed with talent, and that the Chinese ruling elite recruits talent the way the N.B.A. does — rigorously, ruthless, in a completely elitist manner. As you rise in school, you see that to get into an elite university, you need to ace the exams given at the end of your senior year. Chinese students have been taking exams like this for more than 1,000 years. The exams don't reward all mental skills. They reward the ability to work hard and memorize things. Your adolescence is oriented around those exams — the cram seminars, the hours of preparation. Roughly nine million students take the tests each year. The top 1 percent will go to the elite universities."

We (in America) think it's tough getting a student into Harvard. That task looks simple compared to the Chinese system Brooks describes. What about the other 99 percent of Chinese students?

"Some of the others will go to second-tier schools, at best. These unfortunates will find that, while their career prospects aren’t permanently foreclosed, the odds of great success are diminished. Suicide rates at these schools are high, as students come to feel they have failed their parents."

Before deciding whether such a system will help China become an intellectual and innovative super power, Brooks continues his fictional story of the student who would succeed.

"You ace the exams and get into Peking University. You treat your professors like gods and know that if you earn good grades you can join the Communist Party. Westerners think the Communist Party still has something to do with political ideology. You know there is no political philosophy in China except prosperity. The Communist Party is basically a gigantic Skull and Bones. It is one of the social networks its members use to build wealth together. You are truly a golden child, because you succeed in university as well. You have a number of opportunities. You could get a job at an American multinational, learn capitalist skills and then come back and become an entrepreneur. But you decide to enter government service, which is less risky and gives you chances to get rich (under the table) and serve the nation. In one sense, your choice doesn't matter. Whether you are in business or government, you will be members of the same corpocracy. In the West, there are tensions between government and business elites. In China, these elites are part of the same social web, cooperating for mutual enrichment. Your life is governed by the rules of the corpocracy. Teamwork is highly valued. There are no real ideological rivalries, but different social networks compete for power and wealth. And the system does reward talent. The wonderfully named Organization Department selects people who have proven their administrative competence. You work hard. You help administer provinces. You serve as an executive at state-owned enterprises in steel and communications. You rise quickly."

As Brooks goes on to explain, this doesn't sound much like the communist system that Gen X'ers learned about in high school and college.

"When you talk to Americans, you find that they have all these weird notions about Chinese communism. You try to tell them that China isn't a communist country anymore. It's got a different system: meritocratic paternalism. You joke: Imagine the Ivy League taking over the shell of the Communist Party and deciding not to change the name. Imagine the Harvard Alumni Association with an army. This is a government of talents, you tell your American friends. It rules society the way a wise father rules the family. There is some consultation with citi