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Can George Soros Save the World?

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David Rieff is the author of numerous books, including "A Bed for the Night: Humanitarianism in Crisis." He is a contributing writer to Book Review and has worked for the Soros foundations over the years and sits on the board of their Central Asian initiative.

Can democracy be fostered, or even created, by undemocratic means? Does it matter if the institution doing this fostering is the creation and extension of one very rich person who need not stand for office, take into account the wishes of an electorate or indeed consult anyone or anything except his bankers, his conscience, and experts to whom he may listen to or not, as he pleases, and staff he may hire or dismiss as he sees fit? The extraordinary career of George Soros, the Hungarian-born American billionaire investor, and his Open Society Network demonstrate, if demonstration were necessary, how pressing the question really is.

On biographical form, Soros is an unlikely political and social reformer. Born into a bourgeois Jewish family in Budapest in 1930, Soros barely survived the Nazi era. At 17, he immigrated to London, where, at the London School of Economics, he came under the influence of Sir Karl Popper, one of whose books, “The Open Society and Its Enemies,” provided Soros with both the title and the template for his democratic activism. Put crudely, Popper’s view was that the fundamental conflict in the modern world pitted the “open” societies of the West against the “closed” worlds of communism and fascism. It was the kind of schema that was bound to appeal to a young man who had almost died at the hands of both kinds of totalitarianism.

Soros wanted to be a philosopher, but Popper discouraged the ambition. Winston Churchill once said that a man can tie his fate to the mast of action or the mast of thought, but never to both, and perhaps the great philosopher discerned that his young Hungarian pupil had more aptitude for the former than for the latter. In any case, Soros went into business and became, first in London and then in New York, one of the great financial speculators of his time and a pioneer of an investment instrument that, at the time, was still something of a novelty, the hedge fund.

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Far from showing traces of idealism in his business life, Soros was, if anything, known for ruthlessness. The mantra of the Gordon Gekko character in the film “Wall Street”--”greed is good”--would have served Soros perfectly well. His most famous coup was in 1992, when he gambled that the British government would be unable to protect the value of the pound sterling. Soros made more than a billion dollars, an achievement that led the British press to dub him “The Man Who Broke the Bank of England” and was said to have cost every man, woman and child in the United Kingdom 12 pounds.

But while amassing his great fortune in the financial markets, Soros also did something utterly unprecedented: He shifted the great bulk of his energies to using the money he accumulated in perhaps the most extraordinarily idealistic and systematic effort by any single individual in modern history to change the world.

Not for him the single-issue obsessions of his fellow plutocrats, whether education, art, Israel or alma mater. Even an ambition as vast as that of Microsoft’s founder Bill Gates’ to cure diseases like AIDS and malaria pales before what Soros has attempted. He has committed himself to reforming not one but virtually every aspect of global society and global governance. And from transforming early childhood education to unseating totalitarian regimes and replacing them with liberal capitalist democracies to, more recently, reforming the international financial architecture under whose auspices he profited so extraordinarily but which he is now convinced stands in desperate need of reform, little has escaped the attention of his worldwide network.

The formative work of his foundations in the late 1970s that would eventually coalesce into the Open Society Institute, with more than 40 projects and national foundations in scores of countries from South Africa to Burma and a budget in the hundreds of millions of dollars, took place in Eastern Europe and the former Soviet Union, where their efforts were crucial in undermining the communist system and, later, in shoring up the fledgling democracies that succeeded it. Soros’ name may be known only among the elite in America, but in the former Soviet Union, he is a living legend, justifiably so.

It is virtually impossible to overstate the importance of the work Soros did in these countries of the former Warsaw Pact and that he continued to do long after the Berlin Wall fell. His financial support for dissident groups during the communist era may well have been decisive. When Mikhail Gorbachev’s regime seemed about to be toppled by old-line Communists, Soros provided leaders of the democracy movement, like the then-still compos mentis Boris Yeltsin, with the photocopying machines they needed to get out the message of resistance. What water and gasoline besieged Sarajevo obtained during the war came thanks to a subset of Soros’ foundation. And if Russian scientists have jobs today, it is in no small measure thanks to the $100-million grant Soros gave to prevent the Soviet scientific edifice from crumbling away, with the predictable seepage of physicists and experts in biological warfare to rogue states like Iraq and Libya. These are a few of the literally dozens of critical interventions Soros has undertaken that are publicly known.

In his serviceable, informative, though wooden and rather reductionist biography of Soros, Michael T. Kaufman quotes the distinguished American diplomat and longtime Soros advisor, Morton Abramowitz, to the effect that George Soros had become the “only private citizen to have his own foreign policy.” Or, as an American diplomat in Central Asia put it to me a few years ago, admiration and resentment vying for pride of place in his tone, “George does what the U.S. government would do if it had the money.” During the Cold War and its aftermath, Soros came to be seen as valuable ally by the U.S. government, even if some of his causes, notably the decriminalization of drugs, made official Washington squirm. The Open Society Institute could act when the United States government was hamstrung, holding the fort, as it were, in places like Tajikistan and Bosnia, while the executive branch made up its collective mind.

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But whether this close collaboration between Soros and the U.S. government will continue in the 21st century is an open question.

Soros has become steadily more critical of what he has dubbed “market fundamentalism”--the ideology of globalization that commands the loyalty of the Bush administration and holds that any interference in markets by government reduces the efficiency of the economy and, like most other forms of regulation, is to be resisted at all costs. As a result, he has been accused of having gone over to the “anti-globalization” camp, recalling his friend, Joseph Stiglitz, the Nobel Prize-winning economist, and former senior official of the World Bank, whose withering critique of the International Monetary Fund has made him something of a poster child for the anti-globalization left. In Soros’ case, nothing could be further from the truth. As he puts it in “On Globalization,” which seems to have been written as a way of detailing how the system might be reformed, Soros writes, “I am passionately interested in improving the system that has allowed me to be successful so that it will become more enduring.” That seems persuasive enough, and only in the right-leaning political consensus of the United States could Soros look like a leftist.

Yet that is precisely the context in which he is trying to operate, and antagonizing the powers that be, no matter how much money he is willing to spend (Soros estimates that he spent $425 million annually through his foundations between 1997 and 2001), is bound to get in the way of Soros’ evident intention of influencing American policy-making at the highest level. It is as if, in his thinking, he has concluded that the U.S. is part of the problem, while in his practice he is committed to the idea that its power offers the solution to the world’s ills.

In “On Globalization,” Soros appeals to the American elite to eschew Realpolitik and embrace what he calls, somewhat self-referentially, “open society idealism.” Here, one cannot help feeling that the dichotomous political choice he presents is not an accurate rendering of those on offer. For surely what has characterized the Bush administration, at least post-Sept. 11, has not been realism a la Henry Kissinger but revolutionary internationalism a la Ronald Reagan.

After all, prudentially and in terms of immediate self-interest, the U.S. has no reason to overthrow Saddam Hussein. Nor are there great material benefits to be gained from doing so. International tensions will rise, the price of oil will go up and the economy will tank. That is why realist graybeards like Brent Scowcroft oppose an intervention.

Soros’ obvious, though mostly implicit, antipathy to the Bush administration blinds him to the idealism of its position. Perhaps, in that narrow sense, it is too close to his own idealism. But agree with them or not, the Richard Perles and the Donald Rumsfelds want to change the world just as surely as Soros does. They even say--and here, though I oppose their prescription and view them as dangerous radicals, I see no reason not to take them at their word--that their goal is to take democracy to places that have long been denied it or have never enjoyed it at all, just as Soros does. In a sense, his quarrel is less with the realists than with these idealists of a different stripe. But to judge by his writings, Soros has not yet understood this.

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Doubtless he will. If Soros has demonstrated anything throughout his career as both a speculator and an activist, it is his ability to change. For even when he wears the motley of the philanthropist, the hedge fund operator is never far from the surface. In countries where he felt nothing much was being accomplished in furthering this goal of “open societies,” he has closed his foundations, selling such “losing” ideological positions just as readily as, in business, he sold losing financial ones.

Soros has never been a humanitarian. At the beginning of the war in the former Yugoslavia, he resisted calls by his staff to get involved. Only when he became convinced that, in helping Bosnia, he was not just helping people survive a war but also helping a democratic, multicultural society resist the ethnic fascism of Slobodan Milosevic’s Serb nationalism did Soros agree to commit money and staff. Typically, when he finally did, he became the largest private donor to the U.N. aid effort, and the people he employed or subsidized, notably the late Frederick Cuny, arguably the most brilliant American relief worker of his generation, were crucial to Bosnia’s survival.

Only a man persuaded of his own genius can achieve so much. And that sense of mission and entitlement, for all the changes in focus and ideology, has been the constant in Soros’ career. But while he prides himself on his ability to ask hard questions, neither he nor his many admirers have taken seriously what is, when all is said and done, the hardest moral question of all--that of democracy. For it is on the anti-democratic foundation of his own will that all his efforts at fostering democracy have been based. Were Soros a latter-day Socrates and believed that an elite of “Guardians” should control the destiny of ordinary people, the gulf between the aristocratic method of Soros’ foundations and their emancipatory and pluralistic goals would be intellectually and morally less ambiguous. Instead, Soros’ extraordinary venture illustrates that oldest of revolutionary dilemmas--the contradiction between ends and means.

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