Stanley Druckenmiller and Paul Tudor Jones: The Billionaire Networks Behind Harlem’s Human Capital Lab

Stanley Druckenmiller, also a hedge fund manager, recruited Gary Cohn of Goldman Sachs for the board of the Harlem Children’s Zone. As board chair, Druckenmiller shaped the leadership of the organization, which came from the highest echelons of New York’s finance sector. Druckenmiller and Geoffrey Canada had gone to school together at Bowdoin in Maine. Druckenmiller serves on the endowment management team there. This may shed light on Maine becoming a early testing ground for Ed Reform 2.0. Perhaps the HCZ’s financiers viewed the state as a useful rural counterpart to the experimentation being carried out in Harlem?

Druckenmiller is a commodities trader of considerable renown. He ran George Soros’s hedge fund between 1988 and 2000, and they collaborated on a scheme to short the British pound in 1992. That day, known as Black Wednesday, brought down the Bank of England, and netted the men a profit of a billion dollars. Druckenmiller managed his own fund, Duquesne Capital, which was heavily invested in the petroleum industry until 2009 when he closed up shop and created an “anti-poverty” foundation with over $700 million in assets. That was the year before the very first social impact bond ever was launched in the UK. After closing out Duquesne, Druckenmiller took up the position of board chair at Blue Meridian Partners, a capital aggregation fund comprised of ten donors who aim to invest $1 billion into “high impact” youth-serving non-profits using HCZ as a model.

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Harlem Children’s Zone: Druckenmiller interactive version of map here.

Another major funder of HCZ and Blue Meridian is the Edna McConnell Clark Foundation (EMCF). Its assets come from Avon. EMCF was the force behind the creation of an experimental Growth Capital Aggregation Fund that tested idea of making big philanthropic bets. Their pilot began in 2007 with large sums directed to Youth Villages, Citizen Schools, and the Nurse Family partnership, which has become the model for “pay for success” home visit programs.

In 2003, the Rockefeller Foundation and Goldman Sachs brought representatives from fifty venture philanthropies to New York to discuss the importance of establishing common metrics for social impact investing, see this report. That was a crucial step in establishing the parameters for a futures market in human capital data. Four case studies were presented during that gathering, one of which was EMCF. Key features of the EMCF case study were an emphasis on systemic collection of outcomes data and insistence on demonstrated effectiveness. The philanthropy had dropped the number of grants is provided from 188 in 1992 to just 53 in 2002. Everyone who accepts EMCF grants must get on board with the data collection program.

Nancy Roob, Harvard MPA, was EMCF’s contact with HCZ and became president of the foundation in 2005. She serves concurrently as CEO of Blue Meridian Partners with Druckenmiller as board chair, a position she took in 2015. EMCF was a funder of the Arnold Foundation-backed Coalition for Evidence Based Policy that spent fourteen years laying groundwork for the passage of Foundations for Evidence-based Policy Making Act HR4174.

It’s worth mentioning that Druckenmiller’s wife, Fiona, serves on the board of the Bloomberg Family Foundation, one of the Bloomberg Philanthropies known for advancing public-private partnership, “what works,” “data-driven” government. During his administration Bloomberg held a competition to build a new applied sciences campus on Roosevelt Island. Cornell-Tech (Tech being Technion, the MIT of Israel) won that competition and now runs substantial research projects in data science around education and healthcare. Tata Consulting, a giant in tech in India contributed $50 million towards an innovation center that opened on the campus December 2017. The center was built to advance research in human computer interaction and “Business 4.0” development. It also supports initiatives promoting AI and cyber security education in New York City schools. Most of those funding the campus operate at the intersection of social impact investing and tech. Interactive version of map below here.

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Cornell Tech / Small Data Lab Funders interactive version of map here.

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During the years of HCZ’s rise, Bloomberg worked very closely with the Behavioral Insights Team (BIT), known as the “Nudge Unit,” which got its start in the UK and later became embedded in Harvard and New York. BIT has advised on 25 different behavioral science projects across the country as part of Bloomberg’s “What Works Cities.” Philadelphia has, in fact, spun off its own dedicated nudge unit, the first municipal level program in the country. Why nudge? Well, it manufactures acceptance that the quality of public services should be quantified as data on dashboards, and it normalizes the use of apps, which subtly influence human behavior and monitor public-government interactions.

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Philadelphia Nudge Unit interactive version of map here.

New York is a city that trades securities, and Chicago is a city that trades commodities. Consequently, the development of human capital futures trading is centered on the latter. I’ve written previously about economist James Heckman’s work out of the University of Chicago, and JB Pritzker’s financial support for his development of a “toolkit” that would somehow guarantee a 7-13% rate of return on early childhood education and health interventions. So, on the east coast we have a set of 168 poverty-intervention calculations (Robin Hood Foundation / Harlem Children’s Zone) and in the Midwest we have an early childhood education toolkit (Heckman). How do they connect?

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As the map below shows, there are actually two points of contact. The first comes via Stanley Druckenmiller’s association with George Soros. Soros’s, Open Society, and William Janeway, of Warburg Pincus, are the primary backers of the Institute for New Economic Thinking (INET). INET funds Heckman’s Human Capital and Economic Opportunities Working Group and also has a presence at Oxford University’s Martin School, which may be a conduit for exchange of intelligence regarding development of “innovative” government contracting mechanisms from one side of the Atlantic to the other. The second comes through Paul Tudor Jones, yet another hedge fund trader and founder of the Robin Hood Foundation. Interactive version of map here.

harlem children zone chicago

Every year Paul Tudor Jones and the Robin Hood Foundation hold a benefit to fund anti-poverty programs, much of proceeds going to the Harlem Children Zone. All who attended last May’s event received a goody bag with a copy of Ken Langone’s book “I Love Capitalism!” It was a souvenir perfectly suited to the gala, which many consider the premiere event of the New York finance sector’s fundraising season. In one night, Paul Tudor Jones secured $50 million from predatory philanthropists pledging tithes in support of the hedge-fund mogul’s poverty-mining programs.

Legendary among the hedge fund crowd, Jones chaired the New York Cotton Exchange in the mid 1990s and helped develop FINEX, the financial instruments and currency products division of the New York Board of Trade in 1985. He anticipated “Black Monday” in 1987 and holding onto short positions made $100 million that year. He maintains memberships in the New York Board of Trade, the Chicago Board of Trade, the Commodity Exchange, Inc., and CME Group, which is part of the Illinois Blockchain development program.

He grew up in Tennessee, home state of Lamar Alexander (ESSA), Chris Whittle (Edison Schools) and William Sanders (creator of VAM, Value Added Model equation that supposedly measures growth in education data, but was really about setting up impact investment metrics). After graduating from the University of Virginia with a degree in economics, Jones started a career in finance learning the cotton futures trade. Remember, we never escape history. He later worked at Commodities Corp, and set up his own firm, Tudor Investment Corporation based in Greenwich, CT.

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Harlem Children Zone: Paul Tudor Jones interactive map here.

Jones and his wife, who is involved with yoga and meditative practice, are major donors to the University of Virginia. They funded the construction of an interdisciplinary Contemplative Sciences Center. During the 2012 attempted ouster of UVA president Teresa Sullivan by board chair Helen Dragas, several media outlets speculated that Jones had played a role. At the time the school had come under fire for not being “innovative” enough around adoption of MOOCs, especially given austerity budgeting. Sullivan was reinstated (she left in 2017), and in the years following the Curry School of Education launched the Jefferson Accelerator to promote research into ed-tech “efficacy,” exactly the infrastructure needed to advance ed-tech impact investing contracts. Following an invitation-only academic symposium sponsored by all the main Ed Reform 2.0 funders in May 2017, the initiative morphed into the Jefferson Education Exchange, a program that funds teachers to use ed-tech and document how they implement it. Ed Tech Efficacy 2.jpg

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Katrina Stevens, former senior advisor on ed-tech to the US Department of Education and now head of Learning Sciences for Chan Zuckerberg, consulted on both projects.

Jones connects New York to Chicago via Robert Dugger who ran Tudor Investment Corporation between 1992 and 2009. During that period, Dugger co-founded the “Invest in Kids” working group with Jim Heckman in Chicago and Art Rolnick out of Minneapolis. Jones contributed a million dollars towards the effort. Rolnick, a senior economist with the Minneapolis Federal Reserve, facilitated the development of outcomes-based government contracts in partnership with Steve Rothschild at Twin Cities Rise. All three men have connections to INET.

Michael Weinstein was a Senior Vice President at the Robin Hood Foundation. According to a 2010 Harvard Business School case study, Weinstein’s focus was developing a Cost-Benefit Analysis approach to the foundation’s grant awards. He wrote a book with Ralph Bradburd, a Williams College economics professor, which provides a blue print for replicating their approach. Columbia University Press published “The Robin Hood Rules for Smart Giving” in 2013. The overview for the book notes the authors’ focus on “relentless monetization.” Surely given IoT, financialization of life, and securitized debt, the authors must have intended a double meaning in the use of “smart” in the title.

rules for smart giving

In 2017, Weinstein left Robin Hood Foundation to head a new consultancy to match “smart givers” with “high impact” non-profits. The organization, ImpactMatters, has a small board with an interesting range of experience. Paul Brest is one of these board members. A long-time professor of law at Stanford, Brest took on the role of Co-Director of Stanford’s Center on Philanthropy and Civil Society, an incubator for impact investing and digital innovation, late in his career. He currently teaches courses in the business school on strategic philanthropy and impact investing. There are also connections between Brest and the pay for success initiatives in Santa Clara County. Brest co-taught a law school practicum on structuring social impact deals with Keith Humphreys that focused the Partners in Wellness SIB model.

harlem children's zone robin hood

I don’t have much information on Kevin Starr who manages a child-poverty NGO that is all about impact and start-up social entrepreneurialism. Dean Karlan is an economics professor at Northwestern who works in the area of global “fin-clusion.” His focus on behavioral economics led him to develop stick, a goal-setting app that leverages the power of the “commitment contract” and is being used on corporate “wellness” platforms. He founded “Innovations on Poverty Action” and is on the board of MIT’s Jameel Poverty Action Lab, too. His specialty is “impact audits” that assess whether an organization has produced “appropriate evidence of impact.”

ImpactMatters’s final board member is Tamara Fox. Educated in genetics and healthcare finance, she worked for the World Bank, Urban Institute, the Leona Helmsley Charitable Trust and the Elma Foundation; the last being of particular interest. While at Elma, a philanthropy that focuses on children’s issues in Africa, Fox was Senior Director of Research. Elma is a funder of Innovation Edge, who partnered with TrustLab and the IXO Foundation to create Amply, an app linking pre-k digital identity to government reimbursement and social impact finance on Blockchain. Amply was piloted through the Earlybird childcare chain in Cape Town, South Africa.

Amply: Blockchain and Early Childhood Development (ECD) in South Africa from ixo foundation on Vimeo.

See how this works? We never escape the history. The financialization of the lives of Black and Brown people extends back to the Doctrine of Discovery and continues to be woven into new systems of economic oppression. They use the most vulnerable communities, Cape Town, Harlem, Jackson, or rural South Carolina, as laboratories for refining their weapons and means of social control, but no one is immune. Philadelphians have been briefed on Amply. I’m sure people in the inner circles are being on-boarded now. Digital identity tracking “social impact” will be a key piece of early childhood education and healthcare moving forward, across the United States. See the shipping container below. Look at it. That is Innovative Edge’s pre-k plan. When they speak of pre-k investments, realize that the goal is minimal investment and warehoused bodies, trained up to deliver data to run the machine.

pre-k cargo container

According to their website, overseers of the Harlem Children’s Zone use real time data and feedback loops to refine “best practices” that will “shift the culture of the community.” But community in question is here Harlem, already a center of creative genius and intellectual engagement, a locus of Black Power. Harlem, which during the period of HCZ’s rise, became gentrified to the point that the community’s rich history began to be erased, and the people who were supposed to be the ones being served started to be forced out. It seems hardly an accident that the likes of Goldman Sachs would target Harlem for its laboratory of social engineering. The hedge funds analysts know the long-range economic forecasts. Given expected market volatility that will come as this new industrial revolution plays out, it seems logical capitalist interests will seek to neutralize strong Black communities who would be to draw on a strong history of artful and committed resistance.

Bay Area tech oligarchs and New York hedge fund billionaires are not here to “solve” poverty. They are here to manage it to their advantage. The future we need is one that will be envisioned by those who have lived through generations of oppression. It won’t come from a grant. It won’t come from “innovative” financing. No Amazon robot is going to deliver it. No, we must build it together, and the last must be put first.

I hope these posts have given you a sense of the scope of the crisis we face but have not paralyzed you entirely, because the time to act is now. My next project is to show how the New York hedge funders and the Chicago human capital economists connect with the pay for success projects cropping up in the Silicon Valley.

What could go wrong??? A lot.

gavin newsom

This is the sixth in a series:

Read the introduction, Could Newsom’s “Choose Children” Budget Advance Digital Slavery in CA?” here.

Part Two: Accounting Ledgers Connect the Dots: From Jamestown To Harlem and Beyond

Part Three: Interoperable Data To Run Human Capital Hedge Funds

Part Four: Could “Community Schools” Be Today’s Sugar Refineries?

Part Five: Will We See A Pre-K TARP (Toxic Assets Relief Program) In 20 Years?

Part Six: Stanley Druckenmiller and Paul Tudor Jones: The Billionaire Networks Behind Harlem’s Human Capital Lab

I wish to express my appreciation for the research of Dr. Justin Leroy, Dr. Tim Scott, and Dr. Calvin Schermerhorn, which informed my understanding of finance and racial capitalism. To better understand our present situation of “surveillance capitalism,” I encourage you to explore their important contributions.

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