Ex-Deputy U.N. Chief Joins With Soros
By Benny Avni
May 7, 2007
The New York Sun
Original Source: http://www.nysun.com/article/53955
George Soros and Mark Malloch Brown deserve congratulations for finally sealing their now famous friendship.
In a letter to shareholders of Mr. Soros's Quantum Fund last week, the globe-trotting financier and the former international civil servant announced the appointment of Mr. Malloch Brown as the hedge fund's vice president. He also will serve as vice chairman of Mr. Soros's philanthropy arm, the Open Society Institute.
Like the case of a man making a longtime concubine an honest woman, Messrs. Soros and Malloch Brown's relationship was a source of whispering and resentment for years and is now legitimate. From now on, the public has no business prying into any arrangement Mr. Soros makes to compensate Mr. Malloch Brown.
The Open Society Institute can now harness Mr. Malloch Brown's zeal for helping the poor, and Quantum can use his financial talents and organizational skills. Mr. Soros stands to receive an excellent return for his outlay, however much he pays.
Things were a little murkier during the years that Mr. Soros utilized Mr. Malloch Brown's talents and skills to yield influence over public organizations. From the World Bank, Mr. Malloch Brown moved on to serve as the administrator of the United Nations Development Program and then across the street to Turtle Bay, where until December he was deputy secretary-general.
While his friend was UNDP chief, Mr. Soros collaborated with the development agency on many projects, especially in the former Soviet satellites, where the Open Society Institute advanced such worthy causes as instilling democratic values.
UNDP sources involved in projects in places like Kyrgyzstan and Georgia say that whenever the UNDP's bureaucracy would try to set a course of action that conflicted with the institute's agenda, Mr. Soros or his representatives would overrule them. Since Mr. Malloch Brown appointed Kalman Mizsei as the UNDP director for Europe and the former communist bloc in 2000, Mr. Mizsei has been seen as Mr. Soros's man at the agency.
In several remote countries, Mr. Soros's representatives share an office with UNDP staff. Sometimes residents have no idea where the Open Society Institute begins and the U.N. agency ends. The publicly financed agency and the private philanthropy, which is tied to a profitable hedge fund, are barely distinguishable.
Any attempt to clear up the confusion was hardly helped by the fact that the UNDP boss, Mr. Malloch Brown, practically lived with Mr. Soros. As I reported in 2005, Mr. Soros rented Mr. Malloch Brown a property adjacent to his own mansion in the upscale Westchester County town of Katonah.
Several news outlets have recently revisited the story, portraying it as a right-wing attack on Mr. Soros, a favorite punching bag. My reporting was a vicious slander, Mr. Malloch Brown wrote to me over the weekend during a long email exchange that I initiated and he graciously answered.
But was it?
Sir Mark pays a market rent, the Financial Times wrote last week, citing no source for the claim. In fact, real estate agents in the neighborhood told me at the time that the five-bedroom, nearly 5-acre property could fetch much more than $10,000, Mr. Malloch Brown's monthly rent — which was less than the $12,500 a month a previous tenant paid.
In an e-mail, Mr. Malloch Brown explained that he and his family pay for their utilities, unlike the previous tenant. But the fact remains that for half a decade, while real estate values were rising around the New York area, Mr. Malloch Brown was able to maintain a round figure rental arrangement that was slightly lower than that of a previous tenant.
As we have learned from the political skirmish now engulfing the World Bank, international institutions find it hard to set up rules separating private friendships from the public interest.
In an attempt to revitalize the UNDP, Mr. Malloch Brown had stressed the need for more cooperation with the private sector on development issues. This is not necessarily a bad idea, as long as clear rules are created to separate the public interest from that of private bodies. Mr. Malloch Brown's relationship with Mr. Soros made any attempt to do so only murkier.
And so he deserves congratulations now, as a straight financial arrangement has been struck between two talented powerhouses who obviously work together well.