George Soros | Charlie Rose | 1994 #2 | Summary and Q&A

Summary

In this video interview, George Soros, a philanthropist and founder of a successful hedge fund, discusses various topics including the missed opportunities in the Soviet Union and Eastern Europe, the rise of closed societies, the power of global markets, the role of governments in regulation, and his own public persona. He also talks about the economy, leadership, and the failures of open societies in addressing conflicts like Bosnia and Rwanda.

Questions & Answers

Q: How does George Soros feel about the missed opportunities in the Soviet Union and Eastern Europe?

Soros believes that there was a historic opportunity that was missed due to a lack of imagination and understanding of the revolution taking place. He thinks that the return of communism is not a concern, but closed societies that suppress freedoms based on ideologies like nationalism are the real danger.

Q: Are the forces for closed societies more powerful than the forces for freedom and free markets?

Soros explains that it is an unequal battle because free markets require law and order, well-defined borders, and security. Insecure situations lead to a breakdown of law and order, capital flight, and the destruction of economies. He cites the example of Yugoslavia, which was making progress in reforms but was derailed by political instability.

Q: Why did the West miss the opportunity to respond to the collapse of communism?

Soros believes that the West lost its moorings and its concept of freedom has eroded over the years. He mentions the concept of geopolitics and laissez-faire, which have incapacitated the proper response.

Q: What does Soros want the Clinton administration to do in response to the missed opportunities?

Soros wants the Clinton administration to develop a concept about foreign policy and to stand for an open society in the former Soviet empire. He also supports the idea of a partnership for prosperity in addition to the partnership for peace.

Q: Does Soros encourage investment in Eastern Europe and Russia?

Soros initially stayed out of investing in Eastern Europe due to concerns about mixing his influence with his foundations. However, he now sees enormous opportunities, especially in Poland, Hungary, and the Czech Republic. He mentions the turbulence and high risk associated with investing in Russia.

Q: Do global markets have more influence than national governments?

Soros believes that the power of national governments has declined due to the internationalization of financial markets. He argues that financial markets need international regulations and supervision as they are inherently unstable.

Q: Are global markets accountable? How can they be regulated?

Soros mentions the beginnings of international regulation, such as the bank standards established by the Bank of International Settlements. He thinks that central banks should be concerned about markets, but regulations should be international to be effective.

Q: Does Soros have influence on markets? What is his public persona?

Soros acknowledges that he is seen as a guru and an influential figure in markets, but he believes that he does not have the capacity to move markets with his predictions. He wants to avoid making predictions that could influence markets. He also clarifies that his public persona is distinct from who he really is, describing himself as a self-centered person.

Q: How has Soros' public persona changed due to his investments and public influence?

Soros discusses two major changes in his public persona. In 1989, he sought publicity to influence Western reaction to the revolution in Eastern Europe. Later, his role in the sterling crisis made him a mysterious figure who can supposedly move markets. He expresses discomfort with the myth around him, which does not correspond to reality.

Q: Does Soros believe in the strength of the United States economy and the leadership of the country?

Soros acknowledges that the U.S. economy is strong with considerable resilience, but he expresses concerns about the potential for inflation and the depreciation of the currency. He believes that presidents do not manage economies, and he gives credit to President Clinton for some aspects of managing the economy.

Q: How is the United States perceived internationally in terms of leadership?

Soros believes that the U.S. is not well respected given its position as the remaining superpower. He criticizes the handling of negotiations in Bosnia, comparing them to Munich appeasement. He sees a failure of open societies in addressing conflicts and a lack of leadership from the United States and Europe.

Takeaways

George Soros believes that there were missed opportunities in the Soviet Union and Eastern Europe due to a lack of imagination and understanding. He sees closed societies, rather than communism, as a real danger. Soros thinks that global markets have more influence than national governments but need international regulation. He expresses concerns about the failures of open societies in addressing conflicts and the lack of leadership from the United States and Europe. Despite the myth around him, Soros believes that he does not have the capacity to move markets with his predictions. He calls for a concept in foreign policy and emphasizes the importance of an open society.