JUST before Christmas, the Financial Times named George Soros as their Person of the Year and the standard bearer for liberal democracy, an idea they say is under siege from populists. They portrayed him as a victim facing daily attacks for his ‘activism and liberal vision of the world’. Karen Harradine has a different story to tell of a less amiable and a more disturbed and destructive man. Her three-part review, drawn from his own account of himself, starts today.
To say that George Soros is a controversial man is to understate it. Conspiracy theories swirl around him. The far Right accuse him of being a puppet master and the far Left accuse him of promoting Western interests and NATO. To grasp who Soros really is, I delved into his book, Soros on Soros: Staying Ahead of the Curve. Although it was written in 1995 much of the book is still relevant and offers a fascinating retrospective analysis.
Soros’s book (in his words, ‘a summing up of my life’s work’) is divided into three sections – Investing and Global Finance; Geopolitics, Philanthropy and Global Change; and Philosophy. Written in an interview format, it is an extension of a discussion Soros had with a little-known German journalist, Krisztina Koenen, and has additional questions from his better-known friend Byron Wien.
A substantial chunk of the first part is taken up with a detailed description of Soros’s boom and bust theory, which is based on his idea that financial markets are inherently unstable. For those not interested in economics it is still worth reading for its initial insights into Soros’s personality, especially his feelings of insecurity. It is these that drove him to go against the conventional wisdom that the markets are always right – and adopt the counter position that they are always wrong. It is as though Soros seeks out flaws in the market to satisfy his sense of insecurity.
It is already obvious that Soros suffers from a form of cognitive dissonance – the mental discomfort brought about simultaneously holding two or more contradictory beliefs, ideas, or values – between his self-perception and his perception of what he has achieved. From the start of the book he comes across as detached from his sense of self, possibly a protective mechanism formed from his experiences of the Holocaust.
Soros was born in 1930 in Budapest, Hungary, to Jewish parents, whom he loved and describes as very different people. His father made his fortune in property and taught him how to manage life; his mother taught him to be introspective.
Hungary was occupied by the Germans in March 1944, when Soros was just 14. His father, as a veteran of World War One who had also experienced the Russian Revolution, knew how to ensure his family’s survival, arranging for false identity papers and a place for them to hide.
Soros claims to have helped his fellow Jews during that time but accusations that instead he and his father were ‘kapos’, Jews who betrayed other Jews to the Nazis, have refused to go away though vigorously denied in mainstream media sources such as this. His own description of war as a time of ‘exciting adventures’ (pg 28) and his declaration that 1944 was the happiest year of his life are bizarre, given that this was when Nazis implemented the last phase of the Final Solution. Soros’s pride in thriving while millions suffered and perished is disturbing. He acknowledges the oddity of his comment but excuses it by saying his father’s protection made him feel invincible. This seemed to add to his grandiose sense of self, a troubling personality aspect, indicative of severe psychological damage, and bordering on the pathological.
Even Soros’s mother failed to escape his lack of empathy. When she was traumatised after being questioned by police under suspicion of being Jewish, he astonishingly told her to ‘pull herself together’ (pg 30). He was not prepared to tolerate human weakness and flaws in anyone but himself, explaining that his parents instilled a sense of exaggerated expectations in him and that reality had caught up with these expectations. He has already admitted to having a messianic complex and how he indulges his ‘messianic fantasies’ by giving away money that he has earned (pg 15).
What quickly becomes apparent is how often he contradicts himself. Despite his messianic complex Soros keeps referring to a crippling sense of insecurity that makes him afraid to admit his successes. Though flaunting his enjoyment of the war he briefly admits to feelings of guilt and shame, without explaining why. It is as though he is unable to see the relationship between these feelings and his behaviour during the Holocaust. That such a severely flawed (and in denial) man has been able to indulge his fantasies (even megalomania) to the extent that he has should worry us all. I will explore more of this in Parts Two and Three.
After the war, frustrated from living under the Communist regime in Hungary, the 17-year-old Soros sought sanctuary in England – a country he thanked four decades later by shorting its currency.
Once in London, Soros began his career in finance as a trader, becoming a securities analyst and then what he describes as an institutional salesman.
In 1956, he emigrated to the United States, entering the world of finance and investments in which he was to make his fortune. But following a series of bad investments and changes in American government regulations, he focused on writing a philosophical dissertation from 1963-1966, the notes of which can be found in the book’s appendix.
In 1970, he launched his own hedge fund, Soros Fund Management. This eventually became the Quantum Fund and would be used to finance a practical application of his philosophy. Its central premise, influenced by philosopher Karl Popper, is that our understanding of the world is inherently imperfect. Soros borrowed the name for his new foundation, The Open Society (created in 1980) from Popper’s anti-totalitarian treatise and defence of Western liberal values, The Open Society and its Enemies, a book that became the touchstone for progressive opinion. Sacrifice for the common interest is a central tenet of his open society dogma. Soros criticises countries and individuals for having so little regard for the ‘common interest’. He doesn’t say what is meant by this.
But he uses his fortune to develop his Open Society Foundations – a network of partners and projects in more than 100 countries, including Hungary, Poland, Ukraine and Russia – to further his libertarian yet interventionist ideology which, despite his constant explanations of it, fails to make sense and comes across as intangible and nonsensical.
For most people Soros emerged into public consciousness in September 1992 on Black Wednesday as the man who broke the Bank of England, another episode he describes with pride. It was the day he made more than £1billion profit by shorting sterling while the British taxpayer lost £3billion. In desperation the British government had raised interest rates, which Soros coolly sabotaged. A trial run on shorting the Italian lira had given him funding and confidence to do the same to sterling.
Soros’s peculiar habit of ignoring destruction around him, even if he is responsible for it, is evident again. Instead of showing concern about the dire consequences shorting sterling would have on millions of British citizens, his focus is solely on the excitement of aggressively pursuing his aim. Glibly brushing off any suggestion that his actions destroyed any chance of salvation for sterling, he prefers to blame the system.
Despite his claims that morality in business is important to him it is clear this didn’t extend to shorting sterling. It is hard to see gambling on currencies to the extent that he did as anything other than playing with people’s lives and utterly ruthless and immoral.