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"Great Game" Part 3

The Men Behind the Curtain at Nazarbayev (World Bank) University

by STEVE HORN AND ALLEN RUFF

A year ago, on Dec. 15, 2011, Kazakhstan state security forces opened fire with U.S.-supplied weapons on oil workers on strike since the preceding May for increased wages and better conditions in the Caspian Sea company town of Zhanaozen. According to the official count, 15 workers died and upwards of 70 were wounded. Unofficial accounts reported much higher number of casualties.

Several hundred miles to the east in the capital, Astana, business went on as usual that day for the Western faculty members and administrators at the recently built multi-billion dollar Nazarbayev University, a joint venture involving the country’s authoritarian regime, the World Bank, and a number of major, primarily US “partnering” universities. This is the third of a three-part series, stimulated by news of the “Zhanaozen Massacre” and initial word of “global university” dealings in Kazakhstan.

The following is Part 3 in a series of this explosive investigate report. Also check out Part 1 and Part 2.

Kazakhstan’s Nazarbayev University (NU), constructed in the last five years at the country’s new capital Astana, did not magically arise out of thin air.

The multi-billion dollar showcase campus, with its English-only curriculum and partnering ties to major Anglo-American research universities, came about through a close alliance between the authoritarian regime of the country’s “Leader for Life,” Nursultan Nazarbayev and the World Bank, the self-described “Knowledge Bank.”

Located in a resource rich, strategically located country deemed vital to U.S. national interest, NU came about in large part through the guidance of a small cadre of key actors with career-long connections to the Bank and the U.S. national security state. These individuals currently occupy vital positions in overseeing the institution.

NU’s Leadership Tethered to the World Bank

The most visible example is the current Rector (President) of the University, Shigeo Katsu, a decades-long Bank operative with a career primarily spent in West Africa and East Asia. He became the Bank’s Vice-President for the Europe and Central Asia Region in 2003, and moved on from that position to become head of NU’s administration in 2010.

Katsu was recommended for the NU post by advisors from the University of Pennsylvania’s Graduate School of Education (GSE), contracted from early on in the planning of the new University. Most notable among them was Alan Ruby, another former World Bank hand and global education consultant presently involved in the restructuring of Kazakhstan’s education system.

Another visible actor in NU’s administration is Aslan Sarinzhipov, the current chair of the Executive Council, the university’s management team. Formerly employed by the Foreign Ministry as the diplomatic “attaché on the economic issues” at Kazakhstan’s Washington Embassy, he subsequently served as the World Bank’s in-country project coordinator for “infrastructure and the financial and private market development.”

Sarinzhipov is also deputy chair of the country’s National Analytical Center (NAC), the central monitoring body for the national economy formed by the Nazarbayev regime and the National Bank of Kazakhstan. It provides “objective analysis of economy performance indicators, fiscal and budgetary policy implementation outcomes, and human capital development processes.” With guidance from the World Bank and other international financial institutions “at the project implementation level,” the NAC formally became an “Affiliated Organization” of NU in June 2011.

Sarinzhipov acted as university CEO starting in Sept. 2009, when the school was still simply known as the “New University of Astana.”

In addition to Katsu and Sarinzhipov, other less visible but influential figures with Bank or U.S. national security state ties have played important roles in NU’s development.

Two “men behind the curtain” working at the commanding heights at NU stand out in particular: the former advisor on Eurasia to the U.S. National Security Council, David Merkel and World Bank career man Dennis De Tray, now a key for-hire consultant for the Nazarbayev regime.

Simply described as an “independent expert-analyst,” David Merkel is the one apparent “westerner” on the Board of Trustees of NU, while De Tray serves on the Board of Directors of the NAC. Their individual stories and career paths illustrate both the interconnected global agenda of the World Bank and U.S. national security state interests.

Dennis De Tray: From University of Chicago to Kazakhstan

Dennis De Tray received his MA in 1972 from the University of Chicago Economics Department, after studying with “free market” proponent and neoliberal ideologue, Arnold “Al” Harberger. Harberger is best known for advising the “Chicago Boys,” instrumental in implementing free-market reforms in Chile under the Augosto Pinochet dictatorship in the 1970s.

Upon leaving Chicago, De Tray worked for over a decade as a researcher at the RAND Corporation. He worked at the World Bank from 1983-2006.

During his tenure at the Bank, De Tray held multiple positions around the world, ranging from the tropics of Central America and the Dominican Republic, to Indonesia, and eventually navigating his way to Central Asia and Kazakhstan. He was World Bank Country Director for Indonesia, stationed in Jakarta from July 1997-March 1999, a turbulent time in the country’s history.

Indonesia – as illustrated by investigative journalist John Pilger’s documentary exposé “The New Rulers of the World” — was completely ravaged in the latter part of the 20th century by internal social and political turmoil made worse by the meddling World Bank “developers,” U.S. Cold War strategists, and multinational corporations. It all came to a head in 1998 when the Suharto dictatorship came to an end, forced from power by a massive “people’s power” movement.

Suharto had come to power in a U.S. CIA-British MI6-assisted miltary coup in 1965, which ousted the popular reform-minded Sukarno. In the coup’s immediate aftermath, Suharto’s military and civilian assassination squads, using lists provided by the CIA, rounded up and murdered as many as 1 million alleged Communists and Sukarno supporters.

With all opposition repressed, the US-backed dictatorship opened the country to foreign investors and international financial institutions, most notably the World Bank and its paternal twin, the International Monetary Fund.

Under Dennis De Tray’s watch as the Bank’s Country Director in the final years of the dictatorship, an estimated $25 million in World Bank funds earmarked for development projects, disappeared, siphoned off  by the kleptocratic regime. The Wall Street Journal subsequently noted that “World Bank officials knew corruption in Bank-funded projects was common, but never commissioned any broad reports tracking how much money was lost to it.”

The corruption ran so deep that U.S. Sen. Mitch McConnell (R-KY)  demanded the Government Accountability Office (GAO) produce a report to explain precisely what happened to those tens of millions of dollars. In damning fashion, the GAO explained that “Dennis De Tray ignored internal reports detailing program kickbacks, skimming and fraud because he was unwilling to upset the Suharto family and their cronies whom he believed were responsible for Indonesia’s economic boom.”

Responding to the GAOs findings and other criticism of the Bank’s role in Indonesia, DeTray in 2006 stated that there was “a trade-off between dealing with corruption and the pace with which we improve the lives of the poor. The tougher we are on corruption and the corrupt, the less we will improve the lives of the poor today.”

Suharto died in Jan. 2008, responsible for the deaths of far more than a million people. De Tray’s response: critics should shut up and give him his due.

“I have taken a good deal of grief over the years since I left Indonesia as an apologist for Suharto. Why? Because I have argued that the bad that he did — and some of it was horrific — should be balanced against the good, not for the sake of Suharto but for the sake of development,” De Tray wrote. “To see Suharto as just another corrupt dictator is to risk losing the lessons from one of the great development success stories of all times.”

De Tray, touting increases in per capita income as a measure of such “success,” neglected to mention that today, “120 million citizens…live on less than two dollars a day” and that tens of millions live without bare necessities, such as “clean water, proper nutrition, healthcare, education, clothing and shelter,” according to a Jan. 2012 Inter Press Service.

De Tray and NU

Upon leaving Indonesia, De Tray worked in Hanoi, Vietnam from 1999-2001 as the Senior Resident Representative for the IMF. He then served for roughly five years as the Bank’s Director for its Europe and Central Asia Region, based in Almaty, Kazakhstan. De Tray served in this capacity at the same time that the future President of NU, Shigeo Katsu was working as the Bank’s Vice President for the Region.

Upon leaving the Bank, De Tray became the first Vice President of a Bank-funded NGO, the Center for Global Development (CGD), a self-described “think and do” development think-tank. Its founding President Nancy Birdsall formerly served as the head of the Policy Research Department at the World Bank.

In 2009 CGD’s funding came from the likes of Goldman Sachs, Chevron, Cargill, DeBeers, and Nestle, among others. In 2006, it received funds from Citigroup, Nike, Microsoft, and the Bill and Melinda Gates Foundation, the ultra-conservative Smith Richardson Foundation, and many others.

CGD, in other words, could just as easily be identified as the “Center for Corporate Development.”

CGD’s Board of Directors also has many ex-World Bank employees, including Larry Summers, the former Harvard University President who from 2009-2010 worked as the head of the Obama White House’s National Economic Council. During Summers’ brief stint as Chief Economist of the World Bank from 1991-1993, De Tray worked as his Senior Economic Advisor.

De Tray is also a Principal at Results for Development (R4D), founded in late-2007 as a “high-quality research approach of a traditional think tank with the capacity to turn that research into action on the ground in developing countries.” Also listed as an Expert for R4D is Alan Ruby, a key advisor for the restructuring of Kazakhstan’s education system.

R4D’s funders include the World Bank, the Government of Kazakhstan, the Bill and Melinda Gates Foundation, the United States Agency for International Development (USAID), the Rockefeller Foundation, among others.

Under the auspices of R4D, De Tray helped lay the groundwork of what would become NU while working as a senior advisor for “Kazakhstan 2030,” the country’s economic development plan for the next two decades. A key portion of the Kazakhstan 2030 “Blue Print For Success” — as it is referred to as by Kazakh state media — deals with higher education and the creation of “world-class universities.”

Dennis De Tray shakes Nazarbayev’s hand at the grand opening of the “Leader-of-Nation’”s namesake university.

“One such university is the new Nazarbayev University,” explained Kazakhstan Edge, “which has been introducing innovative teaching methodologies into the country in partnership with major international universities.”

De Tray serves on the Board of Directors of the National Analytical Center. Among NAC’s projects are Human Capital Development, where one of the Strategic Initiatives is fulfilling the dictates of Kazakhstan 2030.

“Quality of higher education will correspond to the best world standards and practices,” reads the NAC website. “The effective system of technical education and vocational training, integrated into the world educational sector, will be created.”

De Tray has also served as a key “go-between” for Kazakhstan’s government, facilitating meetings between university partners, upper-level NU management, and high level Kazakh government officials.

A case in point: De Tray accompanied a high-level Kazakh delegation including the country’s Deputy Prime Minister Yerbol Orenbayev and then-President of “New University of Astana” (now NU), the former employee of the World Bank, Aslan Sarinzhipov to the University of Wisconsin-Madison in March 2010 for the signing of contract to assist in the creation of NU’s Social Sciences and Humanities Department.

De Tray was also present for a June 2011 Astana meeting of representatives from NU’s international university partners and Kazakhstan’s then-Prime Minister Karim Massimov (currently Chief-of-Staff for Kazakhstan’s “President-for-Life,” Nursultan Nazarbayev).

De Tray greets Karim Massimov, NU Supreme Board of Trustees Member, the then-Prime Minister (now Nazarbayev’s Chief-of-Staff) as fellow Board Member and Deputy PM Yerbol Orynbayev looks on at June 2011 NU international partners meeting.

De Tray Consulting: On the “Silk Road” to Afghanistan

While continuing as a consultant at the NAC, DeTray has also benefited from other ventures in Central Asia.

He runs a business bearing his name: De Tray Consulting. The firm, with a US address in McLean, VA, received two Department of Defense Army contracts for Afghanistan, the first for $319,500 in 2010 and another in 2011 for $326,822. Both contracts were for “professional services.”

Going to Afghanistan, he served as an adviser to the 173rd Airborne Brigade Combat Team (ABCT) in Logar and Wardak provinces in 2010, but one of numerous units involved in counterinsurgency (COIN) efforts throughout the country.

A 2007 piece appearing in the Army press reported that the 173rd ACBT utilizes UAVs (unmanned aerial vehicles), more commonly referred to as “predator drones,” for its daily COIN operations. The Army’s Stars and Stripes also reported that the 173rd incorporates biometrics such as retina scans and facial recognition in its “field work.”

De Tray in Occupied Iraq

De Tray also went on a delegation to Iraq in 2009, a visit which he described as “remarkable because I was privileged to see more of Iraq than all but a handful of visitors have been able to see.”

According to a blog post by him, the team was “brought together,” by the now-disgraced General David Petraeus and U.S. Ambassador Ryan Crocker, “to take a fresh look at Iraq’s development efforts” and to “see what more could be done that would support recent security gains by creating jobs and improving services.”

Dennis De Tray on a “Banker’s holiday” in occupied Iraq, 2008.

De Tray also observed that he “now know[s] more about body armor, Blackhawk helicopters, armored Humvees, Stryker and MRAP armored vehicles, C-17 and C-130 transports than I ever thought possible…or wanted to!”

Most importantly, De Tray went to Iraq to observe the operations of Provincial Reconstruction Teams (PRTs), a key component of current COIN efforts in both Iraq and Afghanistan. De Tray suggested in his blog post that PRT operations in Iraq should begin to parallel the efforts of two programs run by his former colleague in Indonesia, Scott Guggenheim.

Guggenheim formerly ran the World Bank’s $1.3 billion Kecamatan Development Program, “Community Driven Development” initiative that Bank critic Toby Carroll described as a “Neoliberal Trojan Horse” in a 2009 essay. Guggenheim now runs the Bank-funded National Solidarity Program in Afghanistan, which is based on the very same “Community Driven Development” concept.

Coming off of his Iraq visit, Detray suggested that, “PRTs must change from Coalition Provincial Reconstruction Teams to international Iraq Development Assistance Teams” De Tray wrote. “They should transition from ‘doing development because local governments could not’ to supporting local governments in their efforts to do development.”

Merkel: From Russia to Kazakhstan with Love

In a word, David Merkel’s career has been a “murky” one.

His traceable career began in Russia, where he worked for the National Endowment for Democracy’s (NED) International Republican Institute (IRI) in the mid-1990s overseeing Russia’s elections.

IRI’s mission is “to promote free-market democracies around the world,” according to the Institute for Policy Studies’ “Right Web,” further explaining,

In 1983, Congress approved the creation of NED, which was funded primarily through the U.S. Information Agency (USIA) and secondarily through the U.S. Agency for International Development (USAID). Designed as a bipartisan institution, NED channels U.S. government funding through four core grantees: IRI, NDI, the Center for International Private Enterprise, and the Solidarity Center (the AFL-CIO’s international operations institute).

IRI played a role in the attempted coup to overthrow President Hugo Chavez in Venezuela in 2002 and the 2004 coup against Haitu’s Jean-Bertrand Aristide. NED and its offshoots like IRI have been described by CIA critic William Blum as a “trojan horse” for the Central Intelligence Agency (CIA).

As Allen Weinstein, former head of the United States Agency for International Development (USAID), a funder of NED, told the Washington Post in 1991, “[A] lot of what we do today was done covertly 25 years ago by the CIA.”

Further, a 1997 New York Times article explained that NED was “created 15 years ago to do in the open what the Central Intelligence Agency has done surreptitiously for decades.”

Following his stint at the IRI, Merkel took a position as a “risk assessment analyst” at Jefferson Waterman International (JWI), a public relations consulting firm known for its ties to the CIA and PR work on behalf of dictatorial regimes.

Investigative journalist Ken Silverstein described JWI in a 2002 American Prospect article,Despots R Us”: “JWI’s specialty is working directly for foreign regimes, be it fighting off congressional sanctions, winning economic or military aid, or promoting American investment…”

A brief examination of the staff of JWI revealed that eight out of its 26 current employees previously worked for the CIA.

JWI founder Charles Waterman wasthe former Vice Chairman of the National Intelligence Council at the CIA; Sam Wyman, Executive VP and CEO of JWI, ran operations officer with the CIA in the Near East, Western Europe and Africa; Joseph Augustyn, Executive Vice President, Security and Intelligence at JWI is the former Chief-of-Staff for the CIA’s Deputy Director of Operations; and Enrique Prado was “the first CIA officer living in the anti-Sandinista ‘Contra’ camps [during the 1980s clandestine “dirty war” against Nicaragua],” to name several.

The CIA ties are not merely coincidental.

“A specialist in diplomatically sensitive missions, the lobbying firm Jefferson Waterman mostly recruits former intelligence officers,” explained Intelligence Online, a newsletter for “senior intelligence officers, corporate intelligence consultants, heads of security, diplomats and military personnel.”

In 2003, David Merkel became Deputy Assistant Secretary for International Affairs at the U.S. Treasury Department under the George W. Bush Administration, and served through 2005. He went on to become Director for Europe and Eurasia for the National Security Council. Coming off of that stint, he worked as Deputy Assistant Secretary for European and Eurasian Affairs at the U.S. Department of State during the final year of Bush’s presidency.

Merkel’s Ties to Another Caspian Sea Autocracy: Azerbaijan

Following his time with the Bush Administration, Merkel became a visiting professor at the Azerbaijan Diplomatic Academy (ADA), where he currently teaches a course on the Geopolitics of Energy.

According to a 2007 The New York Times story, “The [ADA] opened in March with the goal of training its recruits in a Western-style diplomacy new to this country…” “The idea is to quickly staff Azerbaijan’s empty embassies, fast-tracking aspiring diplomats who would normally work their way up as Foreign Ministry staffers.”

The Academy is Azerbaijan’s first ever training center for up-and-coming diplomats. It was developed with USAID start-up funds, according to a 2006 article published in Azerbaijan’s state media. Its Rector (President) is Khafiz Pashayev, Deputy Minister of Foreign Affairs of Azerbaijan and the country’s former Ambassador to the U.S.

A U.S. State Department diplomatic cable unearthed by Wikileaks from the U.S. Embassy in Baku to U.S. Secretary of State Hillary Clinton explained that Pashayev’s family is “considered the single most powerful family in Azerbaijan,” also observing that the country “is run in a manner similar to the feudalism found in Europe during the Middle Ages: a handful of well-connected families control certain geographic areas, as well as certain sectors of the economy.”

The Azeri regime has projected plans for ADA to become a global model for training diplomatic elites. Paralleling Kazakhstan’s efforts, Azerbaijan has broader hopes to create an education hub similar to Qatar’s “Education City.”

“I want to create something special in education, to be able to show others that they should follow this example,” Pashayev told The Christian ScienceMonitor.

Like Kazakhstan, Azerbaijan’s government, lead by President Ilham Aliyev, has an ugly human rights record, as documented by Human Rights Watch and Amnesty International.

A Sept. 2009 U.S. State Department diplomatic cable from the U.S. Embassy in Baku to U.S. Secretary of State Hillary Clinton compared Aliyev’s record to that of “The Godfather,” going so far to say he’s “Michael Corleone on the outside, Sonny on the inside.”

Energy Holdings and Think-Tanks in the Shadows

Utilizing his insider knowledge of the global energy market, Merkel also currently serves as Senior Advisor for United LNG, LLC, a player in on the looming U.S. shale gas export boom. United LNG co-owns Main Pass Energy Hub with Freeport McMoRan Energy, each owning a 50-percent stake in the project.

With the Obama Administration DOE having recently released a major study calling for expedited exports of U.S. shale gas, the race is on and Merkel has quietly positioned himself in the game.

Merkel is also often listed or introduced as the head of two entities of which little is publicly known and which are virtually untraceable online. According to his biographical sketch presentedin several public appearances, he serves as “Director of the Caspian & Black Sea Policy Forum” and Managing Director of Summit International Advisors.”

Merkel: Human Rights Activist?

In recent months, Merkel has also magically cloaked himself as a human rights activist on behalf of Belarus, a former member of the USSR that borders Russia to the west. He has positioned himself as a “humanitarian” despite the fact he works closely with two dictatorships in Azerbaijan and Kazakhstan, respectively.

One of few nation-states under the sway of the west, a July 2011 article appearing in CounterPunch described the country as being “under siege” by the imperial powers who refer to Belarus as “Europe’s Last Dictatorship.”

“The United States and other Western countries have been attacking the government of President Alexander Lukashenko ever since it refused to follow the path of the other ex-Soviet countries in the 1990s, which famously sold off the state-owned industries to oligarchs, destroyed the social protection system and allowed kleptocratic mafia capitalism to take over,” Michele Branch wrote in CounterPunch.

Merkel has teamed up with other “human rights activists” to pressure Belarus’ leader, Alyaksandr Lukashenka, to step down.

Recently, he co-signed a letter published by Freedom House calling for International Ice Hockey Federation (IIHF) to move the Hockey World Championship to a different country. It’s currently slated to take place in Minsk, Belarus.

“By rewarding the brutal authoritarian regime of Alyaksandr Lukasheka with the status and recognition that hosting this premier global sporting event affords, the IIHF and its members would tacitly condone the actions of a repressive dictatorship. The regime is responsible for gross human rights violations aimed at former presidential candidates, leading pro-democracy opponents of the government, civil society organizers and independent journalists,” the letter exclaimed.

Preceding this letter, Merkel served as a “contributor” for an important report co-published by the Center for European Policy Analysis and Freedom House that called for regime change in Belarus, euphemistically titled, “Democratic Change in Belarus: a Framework For Action.”

The report was written under the auspices of the “Belarus Working Group,” described by Freedom House as “a bipartisan gathering of leading scholars, analysts and former policymakers tasked with identifying sustainable and impactful Western strategies for supporting Belarusian civil society and dealing with ‘Europe’s last dictatorship.’”

The Working Group’s efforts were funded by the far right-wing Bradley Foundation, according to its 2011 Annual Report.

Concluding that the western powers should start “preparing for a post-Lukashenka Belarus,” the report closes by asking the more-than-rhetorical questions, “How will Western governments react to regime change and what approach will the EU and the United States take toward a post-Lukashenka government?” and “What can the international community offer now, as inducement to existing officials who may be open to the idea that regime change is positive and helpful to the country’s future?”

A couple of the report’s contributors sang a similar tune in July 2011, testifying in front of the U.S. House Foreign Affairs Committee’s Subcommittee on Europe and Eurasia.

A month later, the U.S. Treasury Department in concert with the U.S. State Department pushed further economic sanctions in Belarus, with State saying it “will continue to monitor developments in Belarus and to take measures to hold accountable those responsible for the repression of fundamental freedoms and the rule of law.”

Months later, Belarus Democracy and Human Rights Act of 2011 was passed by the U.S. House and U.S. Senate and signed by President Barack Obama on Jan. 3, 2012.

The Act “call[s] on the International Ice Hockey Federation to suspend its plan to hold the 2014 International World Ice Hockey championship in Minsk until the Government of Belarus releases all political prisoners” and for the promot[ion] [of] the conditions necessary for the integration of Belarus into the European family of democracies,” including the continuation of economic sanctions.

“Soft Power Ground Troops” Deployed to “Open Doors” for Foreign Markets

De Tray and Merkel maintain significant positions in Kazakhstan and in Central Asia at-large.

It’s best to think of them as “soft power” ground troops, two U.S.-based operatives doing the bidding of empire abroad, on the ground not with guns, but with financial balance sheets, insight on global energy markets, and ties to the highest levels of government and multinational corporations. They serve as examples of “soft power” and “informal empire” par excellence.

Neither man has any history working in higher education, yet both men are working at the high levels of what is slated to become a major global research university in Astana, Nazarbayev University.

The two men’s histories are illustrative of what NU is and what it is not. Namely, it is not a place for critical thinking. Rather, it’s a site for the development and deployment of the next generation of technocratic and managerial elites, developing “human capital,” and in the long-term, opening up new market doors.

William Appleman Williams, the seminal historian of the U.S. Empire and founder of the critical “Wisconsin School” of diplomatic history, defined the “open door” driving logic of U.S. foreign policy as “unlimited access of US companies to markets everywhere, to be achieved, where necessary, by political and military pressure on foreign states, peoples, and revolutionary movements (where they existed).”

Behind the scenes, De Tray and Merkel have worked as doormen in an increasingly contested arena, opening new doors for prized imperial economic and strategic interests in Central Asia.

Allen Ruff is a US historian and an independent writer on foreign policy issues. He lives in Madison, Wisconsin.

 Steve Horn is a Madison, WI-based freelance investigative journalist and Research Fellow at DeSmogBlog.