This investigation was conducted in the Balkans in the last quarter of 2017, exclusively for the Observatory of Journalism. It was funded by our readers.

The dazzling career of David Petraeus, in turn — from Commander-in-chief of International Forces in Iraq and Afghanistan, to director of the CIA, to leader of the financial giant KKR and a media magnate — embodies a new form of military-security-financial-media power.

It is a career that seemed to have come to an abrupt end when a sex scan­dal forced Petraeus to resign from the CIA in 2012. The case of adul­tery was fur­ther exac­er­bat­ed by the fact that the four-star gen­er­al had lied dur­ing the inves­ti­ga­tion and, more impor­tant­ly, that he was leak­ing state secrets to his mis­tress. He would be sen­tenced to two years on parole and would be charged with a $ 100,000 fine — a tri­fle in com­par­i­son to sim­i­lar cas­es, includ­ing that of Edward Snow­den, who claims to have dis­closed much less con­fi­den­tial infor­ma­tion.

Petraeus would recov­er. Six months after the scan­dal, he would be recruit­ed by the ven­ture cap­i­tal fund Kohlberg, Kravis, Roberts & Co. L. P. (KKR) to run its new­ly found­ed Glob­al Insti­tute.

The Barbarians of Wall Street

In the 1970s and 1980s, KKR was the pio­neer of LBO, or the “lever­aged buy­out” – lever­age here sig­ni­fy­ing mas­sive debt. The archi­tect of this con­cept, Jerome Kohlberg, soon wor­ried by the “over­pow­er­ing greed that per­vades our busi­ness life,” would leave the fund he had cre­at­ed, leav­ing only his K at the head of the acronym. Fol­low­ing his depar­ture, it was the sec­ond K, Hen­ry Kravis, who would lead these LBOs to sky­rock­et, thus earn­ing KKR the unflat­ter­ing nick­name of the “Bar­bar­ians of Wall Street” (the best-sell­er and film “Bar­bar­ians at the Gate” are ded­i­cat­ed to their his­tor­i­cal LBO on RJR Nabis­co). They would remain the cham­pi­ons of this method, despite the prac­tice often result­ing in the dis­mem­ber­ment or even bank­rupt­cy of the com­pa­nies bought, as was the case with their oth­er his­tor­i­cal LBO: Ener­gy Future Hold­ings. The same method is now prac­ticed by Patrick Drahi, who built his media empire on colos­sal debt.

At the end of 2016, Don­ald Trump was con­sid­er­ing Petraeus for head of US diplo­ma­cy, but he would remain with KKR, hence­forth as a part­ner. Kravis and Petraeus are also mem­bers of the Coun­cil on For­eign Rela­tions and reg­u­lar par­tic­i­pants in Bilder­berg meet­ings. Kravis was ranked 38th on the list of the rich­est Jews by the Jerusalem Post.

The invasion begins

Upon his migra­tion into the busi­ness world, the for­mer gov­ern­ment offi­cial imme­di­ate­ly proved his worth by expand­ing KKR’s already impres­sive port­fo­lio. In 2013, the fund made its first direct invest­ment in the region of Cen­tral and East­ern Europe by tak­ing over Unit­ed Group (SBB/Telemach) for an amount nev­er dis­closed but esti­mat­ed to be over 1 bil­lion euros. Unit­ed Group rep­re­sent­ed a con­sol­i­da­tion of the lead­ing cable, satel­lite, and inter­net providers in the for­mer Yugoslavia, with almost two mil­lion sub­scribers:

SBB (Ser­bia Broad­band) — the largest cable oper­a­tor and inter­net provider in Ser­bia with 700,000 sub­scribers;

Telemach — the lead­ing cable oper­a­tor and inter­net provider in Slove­nia and Bosnia and Herze­gov­ina;

Total TV — the first satel­lite TV net­work in Ser­bia, present in all six coun­tries of the for­mer Yugoslavia;

NetTV Plus — the lead­ing OTT plat­form for PayTV and fixed tele­pho­ny;

Unit­ed Media — chan­nels Sport Klub, Cin­e­ma­nia, Ultra, Mini Ultra, Lov i Ribolov;

CAS Media — the largest agency for the sale of adver­tis­ing space on cable and satel­lite chan­nels.

In the fol­low­ing year, 2014, KKR strength­ened its grip. Via Unit­ed Group, it bought the “tur­bo-folk” enter­tain­ment giant Grand Pro­duc­tion and acquired a con­trol­ling stake in the Mon­tene­grin cable oper­a­tor BBM. The com­pa­ny also became co-own­er of the num­ber one infor­ma­tion web­site in Ser­bia, Blic.rs, by buy­ing a 49% stake in Ringi­er Dig­i­tal SA, a dig­i­tal sub­sidiary of the Swiss press group.

Final­ly, KKR launched its own region­al tele­vi­sion chan­nel, N1 TV, an exclu­sive part­ner of CNN, with stu­dios in Bel­grade, Zagreb, and Sara­je­vo. Through this con­tro­ver­sial move, Unit­ed Group uni­fied con­tent dis­tri­b­u­tion with pro­duc­tion.

In 2015, the group set anoth­er prece­dent with the first acqui­si­tion of a mobile net­work — Sloven­ian Tuš­mo­bil — by a cable oper­a­tor. In 2017, it acquired the activ­i­ties of Cen­tral Euro­pean Media Enter­pris­es (CME) in Croa­t­ia and Slove­nia, which includ­ed TV Nova, the most watched Croa­t­ian chan­nel, whose evening news attracts the widest audi­ence in the coun­try amongst news pro­grams; as well as POP TV, whose 24ur is Slove­ni­a’s main news pro­gram. Mean­while, Unit­ed Group has con­tin­ued to expand its activ­i­ties in fixed and mobile tele­pho­ny and to absorb its com­peti­tors, includ­ing BHB Cable TV (Bosnia-Herze­gov­ina), M‑kabl (Mon­tene­gro), and Ikom (Ser­bia).

Who’s hiding whom?

The “finan­cial bar­bar­ians” spear­head­ed by Petraeus have erect­ed a true media empire, but they have done so very dis­creet­ly, shy­ing away from pub­lic scruti­ny. Rare, reluc­tant, and belat­ed inves­ti­ga­tions have, how­ev­er, even­tu­al­ly revealed some details.

In 2015, a “Report on Own­er­ship Struc­ture and Con­trol over Media in Ser­bia” by the Ser­bian Anti-Cor­rup­tion Coun­cil iden­ti­fied the lack of trans­paren­cy of media own­er­ship as its pri­or­i­ty issue. The fol­low­ing year, the own­er­ship struc­ture of Unit­ed Group was inves­ti­gat­ed by the Sloven­ian news­pa­per Delo in coop­er­a­tion with the Orga­nized Crime and Cor­rup­tion Report­ing Project (OCCRP). Their arti­cle “On the Dark Side of Telemach” final­ly allowed the peo­ple of the region a behind-the-scenes look at their prime source of infor­ma­tion. What they found in their probe was a labyrinth of ghost off­shore com­pa­nies, mush­room­ing in tax havens in order to hide the orig­i­nal own­ers and their finan­cial net­works.

A half revelation: the figue leaf is Serbian

The pri­ma­ry tar­get of this inves­ti­ga­tion was Ser­bian Dra­gan Solak. In 2000, he found­ed KDS, a local cable oper­a­tor in Kragu­je­vac (Ser­bia), and while his start-up soared, becom­ing SBB in 2002, SBB / Telemach in 2012, and Unit­ed Group in 2013, he was always able to main­tain his hold on the man­age­r­i­al reins. There was noth­ing secret about it. The true dis­cov­ery of the inves­ti­ga­tion was that he also kept 20% of the shares, hid­den behind the com­pa­ny Ger­rard Enter­pris­es, which had he found­ed in 2001 on the Isle of Man.

This “king of the cable”, reg­u­lar­ly “not avail­able to the media,” now stands as a new busi­ness mag­nate in a dev­as­tat­ed eco­nom­ic land­scape and a flam­boy­ant nou­veau riche out­lier among his impov­er­ished com­pa­tri­ots, with his pri­vate jets, vil­la at Gene­va lake, and a golf course that once belonged to the king of Yugoslavia (Petraeus’s lifestyle has also long been the sub­ject of gos­sip and reports, even in Huff­in­g­ton Post and Wash­ing­ton Post). A Ser­bian in a region where nation­al rival­ries are alive and well, an illu­sion­ist open­ing three off­shore com­pa­nies per day and pulling off “now you see it now you don’t” tricks with mil­lions of euros – and all of this with­out pay­ing tax­es – are just some of the rea­sons that the jour­nal­ists of Delo and those who have fol­lowed in their foot­steps (Nacional, Jutarn­ji list, Ekspres…) chose to turn the spot­light on Solak. More­over, the risk was small­er than if they had fol­lowed the tracks of big­ger game.

The role of American ambassadors

The inves­ti­ga­tion of Delo attempt­ing to untan­gle the ten­ta­cles of the Unit­ed Group’s own­er­ship struc­ture made one thing clear: the own­ers were hid­ing behind a series of veils. What was less clear was whether Solak was one of the own­ers or one of the veils.

Solak did not oper­ate alone. His over­seas financiers, includ­ing KKR, were major­i­ty part­ners in all of his oper­a­tions. They were the ones who allowed him to retain his posi­tion at the head of the Unit­ed Group and who were keep­ing a watch­ful eye over his spec­tac­u­lar rise from the very begin­nings, accord­ing to a diplo­mat­ic cable of the US Embassy in Bel­grade revealed by Wik­iLeaks. It is unfor­tu­nate that this source, although read­i­ly avail­able on the inter­net, has not been con­sid­ered so far.

The cable, from 2007, was focused specif­i­cal­ly on SBB, which is clear­ly evi­dent right from its title “Ser­bia Broad­band oper­at­ing in hos­tile envi­ron­ment.” Solak appears as the main inter­locu­tor of the Embassy, ​​to such an extent that one might won­der about the nature of his rela­tion­ship with Amer­i­can diplo­ma­cy. The sig­na­to­ry, Ambas­sador Michael Polt, trans­mits Solak’s con­cerns to Wash­ing­ton and adds his own report on the joint efforts of US diplo­mats and investors to address them. Their pre­text: to com­bat the mar­ket dom­i­na­tion of the pub­lic oper­a­tor Telekom, which “con­tin­ues to use aggres­sive tac­tics and polit­i­cal influ­ence” to ensure its monop­o­lis­tic posi­tion. Today we under­stand that the ambas­sador was doing exact­ly what he accused Telekom of, just in SBB’s favor. The telegram is dat­ed June 1, 2007, and on June 27, Mid Europa Part­ners announced the his­toric con­clu­sion of the first LBO in Ser­bia: its acqui­si­tion of SBB.

Polt’s suc­ces­sor, Cameron Munter, con­tin­ued his post-diplo­mat­ic career at Mid Europa as an advi­sor to SBB / Telemach dur­ing nego­ti­a­tions with Petraeus in 2013. Polt’s pre­de­ces­sor, the famous William Mont­gomery, the first ambas­sador to be sworn in after the NATO inter­ven­tion in 1999 and the Col­or Rev­o­lu­tion of Octo­ber 5, 2000, and influ­en­tial in the man­ner of an impe­r­i­al pro­con­sul, was a busi­ness part­ner of Brent Sadler. The lat­ter, a CNN cor­re­spon­dent in Bel­grade at the time of the bomb­ings, is now Pres­i­dent of N1 TV, the flag­ship chan­nel of Unit­ed Group, an exclu­sive affil­i­ate of CNN in East­ern Europe.

When enemies become companions

The con­sult­ing firm Mont­gomery Sadler Matić & asso­ciates (MSM) gath­ered an unlike­ly trio: the for­mer US ambas­sador and the for­mer reporter became col­lab­o­ra­tors with Goran Mat­ic, the Yugoslav Fed­er­al Min­is­ter of Infor­ma­tion in 1998 and 1999. His Ser­bian coun­ter­part in the same peri­od was the cur­rent Pres­i­dent of Ser­bia, Alek­san­dar Vucic.

Just before the bomb­ings of 1999, Mat­ic crit­i­cized the media that had been serv­ing for­eign mas­ters: “the sit­u­a­tion is very clear — the own­er pays, the own­er requests the dis­sem­i­na­tion of cer­tain infor­ma­tion.” When NATO attacked, it was he who declared on CNN: “We are ready to fight against the aggres­sors.” When mis­siles razed Radio-Tele­vi­sion of Ser­bia on April 23, 1999, killing 16 peo­ple, the BBC relayed his fol­low­ing state­ment; that this act was “a mon­strous crime with­out prece­dent in his­to­ry.” In the less ver­bose report of his future com­pan­ion Sadler on CNN, the quote would be reduced to two words: “crim­i­nal act.” Tony Blair would retort that the bomb­ing of the tele­vi­sion sta­tion was “ful­ly jus­ti­fied.” On the third of May that same year, World Press Free­dom Day, NATO would raze to the ground anoth­er media out­let, Radio Tele­vi­sion Novi Sad.

Since then, both for­mer min­is­ters of infor­ma­tion have made a U‑turn regard­ing their for­mer ene­mies, Vucic’s being par­tic­u­lar­ly spec­tac­u­lar. His polit­i­cal par­ty went so far as to hire Mont­gomery as an advi­sor and, once in pow­er, his par­ty-led gov­ern­ment did the same with Tony Blair, whom these very same peo­ple regard­ed as a bete noire in 1999. As late as 2005, Vucic wrote a favor­able review of a mono­graph ele­gant­ly enti­tled “British Fag­got Fart Tony Blair” (sic). The ex-nation­al­ist also cur­rent­ly cul­ti­vates a warm friend­ship with oth­er pro­tag­o­nists of aggres­sion against his coun­try, Ger­hard Schroed­er and Bill Clin­ton.

Generals-investors

As for Petraeus, he sports a NATO medal for for­mer Yugoslavia. In 1999, he assist­ed in the plan­ning and coor­di­na­tion of the bomb­ings of Ser­bia as aide-de-camp to the Chair­man of the Joint Chiefs of Staff, Gen­er­al Hugh Shel­ton. Before return­ing as an investor, Petraeus had already been present in the region in 2001–2002, serv­ing as Assis­tant Chief of Staff of the NATO Sta­bi­liza­tion Force (SFOR) in Bosnia and Herze­gov­ina and as a Deputy Com­man­der of a clan­des­tine counter-ter­ror­ist unit charged with cap­tur­ing Serbs want­ed by the Hague, until Sep­tem­ber 11 rede­fined his pri­or­i­ties by turn­ing jihadist allies into supreme ene­mies. “That was where his future course was chart­ed” says Fred Kaplan in his biog­ra­phy “The Insur­gents: David Petraeus and the Plot to Change the Amer­i­can Way of War” (2013, 65).

His four-star col­league, Wes­ley Clark, NATO com­man­der-in-chief dur­ing the bomb­ing of Yugoslavia, also moved into big busi­ness (just like Odier­no, McChrys­tal, and Mullen — remem­ber that as ear­ly as 1961, Eisen­how­er had warned against the mil­i­tary-indus­tri­al com­plex). Wes­ley Clark chairs the Cana­di­an group Envid­i­ty Ener­gy Inc., which is nego­ti­at­ing, in the midst of con­tro­ver­sies, the explo­ration of very sig­nif­i­cant coal deposits of Koso­vo “lib­er­at­ed” by his troops. Although on the sly, Petraeus was KKR’s main nego­tia­tor in Unit­ed Group’s takeover in 2013. He met with Ser­bian PM Alek­san­dar Vucic sev­er­al times, both pub­licly and in pri­vate.

The millions of Soros or how to soar

The Wik­ileaks cable also includes a ref­er­ence to a piv­otal moment in the rise of Unit­ed Group. In 2002, Solak’s small start-up was giv­en an extra­or­di­nary oppor­tu­ni­ty. It man­aged to attract a $10 mil­lion invest­ment from the South­east­ern Europe Equi­ty Fund (SEEF). The fund man­ag­er was Soros Invest­ment Cap­i­tal Man­age­ment, lat­er renamed Bed­min­ster Cap­i­tal Man­age­ment, found­ed by George Soros.

This bil­lion­aire activist shares some coin­ci­den­tal fea­tures with Kravis (from KKR), such as a resort on the Atlantic coast where the two are neigh­bors, as well as less coin­ci­den­tal aspects, like their collector’s pen­chant for Balkan cable oper­a­tors.

It was from the invest­ment of Soros that SBB start­ed its expo­nen­tial growth and its ver­tig­i­nous dive into the murky depths of inter­na­tion­al finance. After Soros, the Euro­pean Bank for Recon­struc­tion and Devel­op­ment (EBRD) called and raised the stakes by invest­ing 15 mil­lion euros in SBB in 2004. This “Euro­pean” bank, whose largest share­hold­er is the Unit­ed States, has remained co-own­er and co-investor of Unit­ed Group into the present day, the end of 2017.

The Soros fund would diver­si­fy into SEEF I and II, which would fig­ure as both buy­er and sell­er in the 2007 takeover of SBB by Mid Europa. In 2014, this pri­vate invest­ment com­pa­ny head­ed by for­mer senior offi­cials of the World Bank and the IMF boast­ed of tripling its invest­ments thanks to the exor­bi­tant amount paid by KKR.

George Soros (born Schwartz) saw his last name changed by an esper­an­tist father. In Esperan­to, the word “soros” means “will soar.” A good omen for small Györ­gy, as well as for Solak’s start-up which he sup­port­ed with such fore­sight.

But who helped Soros at the begin­ning of his career? The ini­tial invest­ment for his start-up, Dou­ble Eagle Fund, lat­er renamed Quan­tum Fund, was pro­vid­ed by George Karl­weiss of Banque Privée from Lugano, owned by Baron Edmond de Roth­schild (see the erased arti­cle in Wash­ing­ton Times). Accord­ing to Time Mag­a­zine, “Mem­bers of the Roth­schild fam­i­ly and oth­er rich Euro­peans soon kicked in an addi­tion­al $6 mil­lion.” Enough to soar, as the future would prove.

Lavish investments in loss-making media

Even the most law­less and faith­less financiers observe one sacro­sanct law: make a prof­it. And yet, the return on KKR’s invest­ment in the Balkan media has yet to appear on the hori­zon. The sec­tor has expe­ri­enced such dif­fi­cul­ties that even flag­ship acqui­si­tions like SBB in Ser­bia and Nova TV in Croa­t­ia are known to have gen­er­at­ed con­sec­u­tive loss­es.

In the case of SBB, KKR’s astro­nom­i­cal invest­ment in 2013 did not improve the sit­u­a­tion. On the con­trary, the avail­able annu­al reports show a steady increase in loss­es, in mil­lions of euros: 33 in 2010, zero in 2011, 10.5 in 2012, 1.4 in 2013, 29 in 2014, 33 in 2015, and 35 in 2016. We can see that in 2016 SBB incurred a record-break­ing loss of thir­ty-five mil­lion euros.

The expla­na­tion? By buy­ing media, Petraeus was buy­ing influ­ence. The ques­tion then aris­es of what type of investor would be pleased to hear his fund explain: “We have nei­ther the bil­lion that you have com­mit­ted nor the prof­it that we promised, but we have gained media influ­ence in East­ern Europe.” It is hard to imag­ine that pen­sion­ers from the Ore­gon pen­sion fund would be delight­ed. On the oth­er hand, it might accom­mo­date the inter­ests of more than one among Petraeus’ acquain­tances at Bilder­berg.

Anoth­er like­ly expla­na­tion is that their expens­es are inflat­ed in order to declare loss­es that do not real­ly exist. Thanks to its net loss, SBB has not paid a pen­ny of income tax for years, despite an income of 170 mil­lion euros only in 2016. The dam­age to the Ser­bian nation­al bud­get could reach eight-fig­ure sums in euros.

States not doing their job

The biggest losers in this dubi­ous scheme are cit­i­zens, who are the main cre­ators of the wealth that Unit­ed Group is pool­ing to tax havens and who, on the con­trary, do pay tax­es. Then comes the com­pe­ti­tion, which does not stand a chance against this priv­i­leged heavy­weight com­peti­tor on the mar­ket, with its finan­cial capac­i­ty, zero tax­a­tion, trans-bor­der carteliza­tion, and CNN pro­gram­ming. Ulti­mate­ly, it is the sov­er­eign states that renounce col­lect­ing tax­es. To say noth­ing of their oblig­a­tion to pro­tect cit­i­zens and free com­pe­ti­tion.

The sov­er­eign states are best placed to inspect KKR’s activ­i­ties. They alone would be able to penal­ize ille­gal prac­tices and close gaps in leg­is­la­tion.

Instead, the states have cho­sen to turn a blind eye. The only rev­e­la­tions about the KKR’s media empire to date were made by non-gov­ern­men­tal indi­vid­u­als and orga­ni­za­tions. As for leg­isla­tive changes, they have only widened exist­ing gaps, as demon­strat­ed in the report of the South East Euro­pean Media Obser­va­to­ry with the explic­it title “Major pow­ers tai­lored Ser­bian media leg­is­la­tion for ‘Balkan CNN.’”

The European Union as a lobby

In 2014 Ser­bia and KKR seemed des­tined to clash. KKR was plan­ning to launch its new chan­nel N1 TV on its SBB/Telemach net­work, under its umbrel­la com­pa­ny Unit­ed Group. At the same time, the gov­ern­ment pub­lished its draft media laws. How­ev­er, one exclud­ed the oth­er, since the laws did not allow dis­trib­u­tors to also be con­tent providers. The ban seemed log­i­cal: the dis­trib­u­tor would favor his own chan­nels at the expense of the com­pe­ti­tion. Just a few years pri­or, the Euro­pean Union had imposed the same prin­ci­ple on the pub­lic tele­vi­sion sta­tion RTS, which had to give up its dis­tri­b­u­tion net­work.

This time, how­ev­er, the opin­ion of Brus­sels would be the reverse, or more pre­cise­ly, would be reversed due to the lob­by­ing of the Euro­pean Bank for Recon­struc­tion and Devel­op­ment (co-own­er of the Unit­ed Group) and the law firm Gide Loyrette Nouel. After a new meet­ing with Petraeus, the Ser­bian Prime Min­is­ter brought events to an abrupt con­clu­sion: “N1 is wel­come in Ser­bia”. The state had caved.

It was the new law, dic­tat­ed by bankers and lawyers via the Brus­sels admin­is­tra­tion, and not the orig­i­nal stem­ming from an elec­toral and par­tic­i­pa­to­ry process, which would be passed in August 2014. Out went the peo­ple, in came the transna­tion­al finan­cial oli­garchy, twist­ing the arm of a Par­lia­ment which now wouldn’t even con­sid­er defend­ing itself.

Epi­logue: N1 TV would be launched in Octo­ber 2014. In March 2017, the cable oper­a­tor SBB removed the most watched chan­nel, the pub­lic tele­vi­sion sta­tion RTS1, from the first posi­tion in the chan­nel line­up. In this place, held undis­put­ed­ly by RTS1 since the begin­ning of tele­vi­sion in the region, SBB insert­ed N1 TV.

Does the owner influence his media?

When NATO bombed RTS in 1999, its argu­ment was based on the idea that a tele­vi­sion out­let nec­es­sar­i­ly broad­casts the pro­pa­gan­da of its own­er. As the own­er in this instance was the ene­my state, and pro­pa­gan­da was part of the war effort, NATO con­clud­ed that tele­vi­sion was a weapon of war and hence a legit­i­mate tar­get.

Now, N1 too has own­ers. Among them is a gen­er­al who was engaged in that same war. Regard­ing pro­pa­gan­da, its press releas­es address­ing the change in the chan­nel line­up pro­vide prime exam­ples of manip­u­la­tion. The title “Grow­ing Polit­i­cal Pres­sure to Low­er N1 on the SBB Net­work” (N1, 2017) sug­gests that KKR’s chan­nel was being low­ered when it was actu­al­ly being raised. N1 is also the grand cham­pi­on of manip­u­la­tion with num­bers. In 2016, its reports quadru­pled atten­dance at a demon­stra­tion sup­port­ed by US NGOs, while the num­ber of anti-NATO pro­test­ers was reduced thir­ty-fold (sic). Dur­ing Ser­bian pres­i­den­tial elec­tions in 2017, tele­vi­sion served as а press ser­vice for some can­di­dates, while entire­ly omit­ting oth­ers.

Warrior for perceptions

The defen­es­tra­tion of democ­ra­cy by KKR for the ben­e­fit of its “Balkan CNN” would be explained by Petraeus as the “devel­op­ment of demo­c­ra­t­ic val­ues.” This was the only time an own­er of N1 has pub­licly com­ment­ed on N1, and he did so exclu­sive­ly to jour­nal­ists of N1. With a straight face, he stressed their objec­tiv­i­ty and inde­pen­dence.

If these state­ments are the exact oppo­site of real­i­ty, it is because we are deal­ing with an expert on wars of per­cep­tions.

“Hard­ly any­thing is more impor­tant in inter­na­tion­al affairs than the his­tor­i­cal images and per­cep­tions that men car­ry in their heads.” This quote opens Petraeus’ first aca­d­e­m­ic arti­cle in 1986, as well as his doc­tor­al the­sis, defend­ed at Prince­ton the fol­low­ing year. Since then, the sol­dier-sci­en­tist has been cham­pi­oning a reori­en­ta­tion of the US mil­i­tary. Pri­or­i­ty should pass from the con­ven­tion­al war to coun­terin­sur­gency (or COIN), under the mot­to “win hearts and minds.” In 2006 he elu­ci­dat­ed his doc­trine in a land­mark mil­i­tary man­u­al (“FM 3–24 Coun­terin­sur­gency”). When he took com­mand in Iraq and Afghanistan from 2007 to 2011, these coun­tries would serve as lab­o­ra­to­ries for putting his the­o­ries into action. Mis­sion accom­plished, there was lit­tle left for him to do but leave the army he rev­o­lu­tion­ized after a very well thought-out career. As a Cadet at West Point, he court­ed the superintendent’s daugh­ter, which made him the sub­ject of mock­ery among his com­rades, but earned him the hand of the young lady. He then advanced in the shad­ow of com­man­ders Galvin, Vuono, and Shel­ton. Until his sex scan­dal broke in 2012, he was the blue-eyed boy of the media, which gave him noth­ing but lauda­to­ry arti­cles (nice­ly called “blow jobs” in jour­nal­ist slang). His charm met few crit­ics, like admi­ral Fal­lon, who sup­pos­ed­ly called him an “ ass-kiss­ing lit­tle chick­en­shit .”

Conquering hearts and minds

A cor­re­spon­dent of Mar­cel Bigeard and an avid read­er of “The Cen­tu­ri­ons” by Jean Larteguy, Petraeus has read­i­ly admit­ted his French influ­ences, in par­tic­u­lar that of the the­o­rist David Galu­la. This did not pre­vent a French com­rade-in-arms, Gen­er­al Mau­rice Dru­art, from denounc­ing his mot­to “win hearts and minds” as “an oppres­sive mer­chan­dis­ing exer­cise car­ried out on the pop­u­la­tion” (see the excel­lent study of the French army “Gag­n­er les cœurs et les esprits”, CDEF, 2010, p. 57).

The true mean­ing of this phrase is defined in the man­u­al FM 3–24 as fol­lows: “‘Hearts’ means per­suad­ing peo­ple their best inter­ests are served by the COIN’s suc­cess. ‘Minds’ means con­vinc­ing them that the force can pro­tect them and that resist­ing it is point­less. Note that nei­ther con­cerns whether peo­ple like the troops. Cal­cu­lat­ed self-inter­est, not emo­tion, is what counts.” The sec­tion “Media and the Bat­tle for Per­cep­tions” offers almost Orwellian pre­cepts: “Con­sid­er word choic­es care­ful­ly… For exam­ple, is the COIN force a lib­er­a­tor or an occu­pi­er?”

Expe­ri­enced in this type of dou­ble­think, Petraeus keeps talk­ing about a “vic­to­ry” in Iraq while the inter­ven­tion has been an indis­putable cat­a­stro­phe. The region has been plunged into chaos, the rea­sons ini­tial­ly invoked proven to be false, and the stat­ed objec­tives not achieved. In fact, the Petraeus mod­el of coun­terin­sur­gency has com­bined great manip­u­la­tion and great vio­lence: civ­il war, air strikes, night raids, drone attacks, and tor­ture. This real­i­ty has hard­ly emerged in the media, which also seem to have fol­lowed the Petraeus text­book (sec­tion “Exploit a sin­gle nar­ra­tive”).

The year 1986 would prove piv­otal for Petraeus. He became a the­o­rist of coun­terin­sur­gency, a mem­ber of the Coun­cil on For­eign Rela­tions, and met James Steele, a vet­er­an of the Phoenix Pro­gram in Viet­nam. In direct com­mu­ni­ca­tion with Petraeus, Steele would help orga­nize death squads and tor­ture cen­ters in Iraq.

Spying and manipulation on the web

In 2010 Petraeus recruit­ed the first army of inter­net trolls (“US Spy Oper­a­tion That Manip­u­lates Social Media”, Guardian, 2011). His CENTCOM Com­mand issued a solic­i­ta­tion for an online per­sona man­age­ment ser­vice that would allow 50 users to run 500 sock-pup­pets “with­out fear of being dis­cov­ered by sophis­ti­cat­ed adver­saries.”

A few years lat­er, sim­i­lar prac­tices by Rus­sia are now in the spot­light of many jour­nal­ists, but the found­ing Amer­i­can exam­ple is reg­u­lar­ly omit­ted. Thus, an arti­cle of the Obs-Rue89 enu­mer­ates five involved coun­tries yet still leaves out the Unit­ed States.

The sol­dier in Petraeus under­stands very well that infor­ma­tion tech­nolo­gies are essen­tial for infor­ma­tion oper­a­tions. As Chief of the CIA, he warned: “We’ll Spy on You Through Your Dish­wash­er” (Wired, 2012). As a media mogul, he has remained as bel­li­cose as ever: “Cyber­space Is a Whole New Domain of War­fare” (BBC, 2017). He is cam­paign­ing pri­mar­i­ly for ever-greater con­trol of the inter­net.

Regard­ing this same sub­ject, KKR con­trols a large num­ber of inter­net com­pa­nies, includ­ing Optiv (cyber secu­ri­ty), GoDad­dy (host­ing), First Data (dig­i­tal mon­ey), and, of course, Unit­ed Group’s inter­net ser­vice providers.

The mas­sive sur­veil­lance of the inter­net by Anglo-Amer­i­can intel­li­gence ser­vices, revealed by Edward Snow­den, was in full swing while Petraeus was head­ing the CIA. It includ­ed projects like PRISM, which allowed direct access to servers of Google, Face­book, Apple, Microsoft, and oth­er giants, as well as Mus­cu­lar and Tem­po­ra, projects which direct­ly infil­trat­ed fiber optic cable sys­tems.

In the Balka­ns, a large part of the inter­net traf­fic goes through providers bought by Petraeus. A Ser­bian study on “Invis­i­ble infra­struc­tures” found that all the traf­fic led to a sin­gle point: “if you would like to exam­ine, fil­ter, or retain all the nation­al traf­fic going through the SBB net­work, you would be able to do that using just this one point.” It so hap­pens that this point is in the pos­ses­sion of KKR.

Why infil­trate, if you can own?

Public money and private money

The wars of Petraeus have come at a high price, not only in terms of human lives, but also mea­sured in tax­pay­er mon­ey. The costs are no longer esti­mat­ed in bil­lions but in unheard-of tril­lions of dol­lars. Unprece­dent­ed sums have also end­ed up in the hands of pri­vate cor­po­ra­tions (“Con­trac­tors Reap $138bn from Iraq War”, Finan­cial Times, 2013) for civ­il tasks (Hal­libur­ton-KBR) as well as for mil­i­tary (Black­wa­ter) and intel­li­gence ser­vices (Bell Pot­tinger). War has been pri­va­tized, hence the sec­tion “Multi­na­tion­al cor­po­ra­tions and con­trac­tors” in Petraeus’ man­u­al.

Already as com­man­der-in-chief, Petraeus had colos­sal funds at his dis­pos­al and dealt direct­ly with pri­vate cor­po­ra­tions. But who is real­ly in com­mand when the biggest mil­i­tary pow­er gets over-indebt­ed to pay for its wars: the com­man­der or the financier?

From military to finance – a promotion

All his life, Petraeus has built up his career by court­ing those high­est in pow­er. His pas­sage from the sum­mits of mil­i­tary and intel­li­gence fields to the ranks of financiers is typ­i­cal­ly seen as one of retire­ment or res­ig­na­tion. We are inclined to see it as a pro­mo­tion.

The career of David How­ell Petraeus fol­lows the same ascend­ing line and the same red thread: the manip­u­la­tion of per­cep­tions. His case illus­trates a rad­i­cal change in the world of media. Before him, no one could have imag­ined a for­mer chief of intel­li­gence at the head of the media, espe­cial­ly not in a coun­try he had helped to destroy. An ene­my gen­er­al, head of the secret ser­vice, and a pro­pa­gan­da spe­cial­ist, he has imposed him­self on the media of a bombed nation, under the pre­text of bring­ing objec­tive infor­ma­tion to it – a real tour de force. But noth­ing shocks hearts and minds already con­quered.