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Philanthrocapitalism is the latest “great white hope” of international development. Unlike traditional philanthropists, who were content to write checks for good causes, “philanthrocapitalists” like Bill Gates and George Soros have supposedly transformed development aid by infusing it with the business principles of innovation, efficiency, and enterprise. Michael Green and Matthew Bishop celebrate this transformation in their best-selling book, Philanthrocapitalism: How the Rich Can Save the World and Why We Should Let Them . Bishop and Green argue that philanthrocapitalism is a “new social contract,” in which increasing inequality is to be accepted in exchange for “the rich regarding their surplus wealth as the property of the many, and themselves as trustees whose duty it is to administer it for the common good.” Should the rich not be sufficiently generous, they warn, “they risk provoking the public into a political backlash against the economic system that allowed them to become so wealthy.” This danger is well understood by “the leading beneficiaries of the winner-takes-all society, [who] worry increasingly about the political risks of growing inequality and are concluding that philanthropy may be one of the best ways to manage those risks.” In a characteristically amusing and suggestive metaphor, Slavoj Žižek has likened this ideological strategy to the phenomenon of chocolate laxatives: each presents the cause of the problem — chocolate constipates, capitalism impoverishes — as the solution to its own pathological symptoms. Žižek’s favored example is Soros: speculator, philanthropist, and one of the wealthiest men in the world. Soros is notorious for making vast profits by precipitating the financial destruction of entire economies. In 1992, he forced the United Kingdom out of the European Exchange Rate Mechanism and into recession by shorting sterling, making an estimated $1 billion in a single day. He has also been blamed for triggering the East Asian financial crisis in 1997 by short-selling the Thai baht and the Malay ringgit, and was accused of playing a role in speculative attacks on the yen in 2013. But liberal elites around the world laud Soros for channelling large quantities of his dubiously earned wealth into philanthropic projects — primarily through his Open Society Foundation, which promotes democracy, free markets, and economic development around the world. The paradox of the chocolate laxative certainly applies in this case. Strangely enough, however, Soros appeals to an even more lurid scatological metaphor to describe his own activities. In his book, The Crisis of Global Capitalism , Soros reflects on his dual role as speculator and philanthropist, noting that “sometimes I felt like a giant digestive tract, taking in money at one end and pushing it out at the other.” The psychoanalytic ramifications of this phrase would have kept Freud happy for a lifetime. But they need not detain us here. Instead, it can serve as the starting point for a parable of philanthrocapitalism. In the world of high finance, Soros is famous for his concept of “reflexivity,” according to which market transactions impact the price signals to which they respond. Meanwhile, in his philanthropic work, Soros emphasizes the constant danger of “unintended consequences.” He does not, however, consider the possibility of a relationship between these two dimensions. In other words, it never occurs to him that “feedback loops” might be established between his speculative activities and his philanthropic projects in unintended ways. In the tale that I am about to tell, we will see how Soros is not only “taking money in at one end and pushing it out at the other,” but is also eating the stuff that comes out at the other end.

The Millennium Villages Project One of Soros’s most high-profile philanthropic activities has been his support for the Millennium Villages Project (MVP), headed by the celebrity development economist Jeffrey Sachs. Sachs’s alliance with Soros goes back a long way. In 1989, for example, Soros paid for Sachs to advise the Polish government in the planning and implementation of its “shock therapy” package of neoliberal reforms, which resulted in massive increases in poverty and inequality, while opening the country to transnational capital. As I recount in my book, Sachs has since been reborn as a self-styled savior of Africa, and is now one of the leading advocates of philanthrocapitalism. In 2005, Sachs cofounded Millennium Promise in partnership with the billionaire venture capitalist Ray Chambers. Millennium Promise is a philanthrocapitalist organization with over two hundred partners, including the foundations of many of the world’s wealthiest individuals and most prominent multinational corporations. It finances the MVP, which was launched in 2006 in ten sub-Saharan African countries and aims to achieve the Millennium Development Goals (MDGs) through a comprehensive set of interventions at the village level that try to catalyze the transition “from sub-subsistence farmers into small-scale entrepreneurs.” A member of Millennium Promise, Soros is also the largest single investor in the MVP, having first given $50 million to the project in 2006. A half decade later, Soros claimed that his faith in Sachs had once again been vindicated: “Five years ago I believed that the Millennium Village Project deserved a shot. After closely monitoring its progress, I now believe it should be scaled up.” At a glittering event in New York, Soros appeared alongside Sachs and United Nations Secretary-General Ban Ki-Moon to announce that the Open Society Foundation would donate another $27 million to the MVP, while his Soros Economic Development Fund would consider additional financing of “up to $20 million in investment-worthy business projects.” Soros likes to emphasize his close involvement in his philanthropic projects, and the care that he takes in selecting the most deserving recipients of his largesse. In the case of the MVP, however, the basis for his confidence in the project is unclear. By the time he announced the second tranche of funding, the MVP’s extravagant claims of success had been comprehensively undermined. In 2010, a World Bank working paper found that the MVP had failed to compare gains within the Millennium Villages to changes in nearby villages with similar baseline conditions, which were not included in the MVP. Without such a comparison, the MVP’s claims to success were unfounded, as it was impossible to judge the extent to which the improvements within the Millennium Villages were attributable to the MVP. Furthermore, the strict controls that the MVP places on independent field research mean that there is very little information on the implementation of the MVP that is not produced and controlled by the MVP itself. In placing such unfounded faith in the MVP, Soros was risking precisely the “unintended consequences” that he fears. And these repercussions have unfortunately turned out to include the “feedback loop” between the two ends of his “digestive tract.” The Millennium Village of Bonsaaso is a case in point.

The Village That Turned to Gold Last year I visited Bonsaaso, in central Ghana, to judge the success of the MVP for myself. Bonsaaso is not actually a village, but includes thirty villages spread over 350 square kilometers of land, with a combined population of over 30,000 people. Unlike other Millennium Villages, which are located in regions in which agricultural production predominates, Bonsaaso is located in the middle of the Ashanti Gold Belt, and artisanal mining has been part of the regional economy for centuries. Bonsaaso’s agricultural sector has also produced cocoa for world markets since the nineteenth century. The MVP is therefore attempting to “transform sub-subsistence farmers into small-scale entrepreneurs” in a region dominated by gold mining and commercial agriculture. Since its launch in 2006, this quixotic enterprise has been overwhelmed by a global gold rush. Between 2001 and 2011, the price of gold on international markets rose from $250 an ounce to $1,900. This phenomenal increase triggered a worldwide hunt for gold ore. Ore is defined not by the quantity of gold within it, but by its potential to be profitably extracted. At some point in 2010, the price of gold hit a certain height, and the rock beneath Bonsaaso transformed into ore. Gold miners from around the world soon descended on Bonsaaso. Previous mining in the area had been dominated by local gangs called galamsey, who work small pits by hand. In contrast to this long-established practice, the foreign miners in Bonsaaso brought excavators and other heavy machinery, causing ecological destruction of a different magnitude. In rural Ghana land is held by chiefs on behalf of their communities, so miners have bribed these chiefs to gain access. They then entered the gold-rich land — often without informing the farmers in advance — dug it up with excavators, exhausted the gold deposits, and left a barren landscape that is impossible to farm. The gold boom in Bonsaaso has brought laborers from around the country, and from neighboring countries such as Togo and Benin. The resulting shortage of accommodation, with migrants often sleeping in the open or in overcrowded conditions, has led to epidemics of skin rashes and other illnesses. Teenage pregnancies and sexually transmitted diseases have increased. Deforestation has accelerated, roads have been destroyed by heavy mining equipment, and the major rivers in Bonsaaso are now so polluted that people cannot wash their clothes in them. Miners have died in pit collapses, and children have drowned after falling into the stagnant, mosquito-laden waters of abandoned mining pits, which have also caused a spike in malaria. Police, military, and private security forces have violently expelled local galamsey gangs from the richest sites. These gangs are now forced to work on poor land, or in the abandoned pits of foreign companies. Meanwhile, small farmers dispossessed of their land have quickly spent their meager compensation, and are migrating to the cities, or looking for day labor in the mines and on the bigger farms. The majority of the foreign miners in Bonsaaso are Chinese, although there are also British, American, Canadian, Russian, Portuguese, Spanish, and Indian miners operating in the region. A Canadian miner I spoke to candidly explained how he had bribed chiefs and government officials to gain a fifty-acre concession of forest and farmland. He claimed that this land contained 1.5 grams of gold per ton of ore, and expected to make $6 million in a year by refining the gold in Accra and exporting 24-carat bars.

Billionaire Philanthropy’s Beautiful Soul The gold rush in Bonsaaso constitutes a clear case of what David Harvey would call “accumulation by dispossession.” The limited resources of a marginalized and impoverished population are being torn away from them in order to fuel a speculative commodity bubble amid a crisis of global capitalism. This is not the kind of story that Soros and the MVP’s other wealthy financiers like to hear about capital accumulation. Rather than confronting such brutal realities, they prefer to maintain the position of the “beautiful soul,” who shrinks away from the horrors of the world around him. Sachs and the MVP understand this all too well, and it explains their response to the crisis in Bonsaaso. In 2012, at the height of the gold rush in Bonsaaso, the MVP’s New York leadership dispatched at least three research missions to Bonsaaso to investigate the situation. The resulting internal reports describe all the elements of accumulation by dispossession that I discovered, and are unanimous in their assessment of the severity of the situation and its implications for the MVP. The third of these reports is dated July 2012, and summarizes the situation as follows: The arrival of Chinese miners in the last two years is marked by violence against villagers, theft of cocoa farms, extreme environmental damage caused by poor mining practices, manipulation of mining laws, reports of corruption, pitting villagers against each other, calls from villagers to take up arms against the Chinese miners, and a profound threat not merely to the benefits of the Millennium Villages Project, but to the ecological and food security of the district, and the peace and wellbeing of its people. By the summer of 2012, the MVP leadership therefore had a clear understanding of the cataclysm. Yet the MVP webpage for Bonsaaso does not discuss gold mining, apart from suggesting that it was a sector of the local economy “years back,” which has since been in “decline.” Photographs on the website and in other promotional material depict Bonsaaso as a pastoral utopia of happy cocoa farmers and do not include a single image of the mining sites that dominate the landscape there. In July 2012, Sachs posted a glowing report on Bonsaaso on the MVP website, which neglected to mention the presence of mining in the region while celebrating the success of the MVP in increasing crop yields, improving education facilities, and reducing malaria and malnutrition. This report was inconsistent with the data contained in the second of the MVP’s internal reports, which is dated “summer 2012,” and which was therefore produced at approximately the same time. According to this data, between 2006 and 2011, the percentage of households in Bonsaaso living in extreme poverty increased from 69.4% to 70.1%; net primary school attendance decreased from 81.1% to 72.9%; mortality rates in children under five increased from 50 to 60 per 1,000 births; and malaria prevalence increased from 63.4% to 71.8%. The MVP has also failed to take any substantive action in response to the crisis. In fact, since 2012, it has abandoned most of its programs in Bonsaaso. In six of the nine villages I visited, the MVP had stopped supporting school feeding programs, all of which had collapsed. It had ceased providing health insurance to the extremely poor, many (if not all) of whom are now uninsured. And it no longer gave subsidized fertilizer and seed on credit, with all but the wealthiest farmers unable to purchase these inputs at market prices. In addition, the MVP has left a series of uncompleted projects scattered about, including a teacher’s cottage, a community radio station, and two public latrines. Piles of water pipes were abandoned in three different villages, despite the severe pollution of the rivers and other water sources around these villages. In the words of one local woman, the MVP “came to where there is poverty and hardship. So they came here to help, but now it’s worse. They didn’t make things better. When they were leaving they didn’t tell us. They left without our knowledge.”