Soros and the making of the European Union
George Soros is one of the richest men in the world. His influence in the economic world is great, but with his Soros Foundations he is also engaged in the development of Eastern and Central Europe. In October he will give a lecture about his vision of Europe including perhaps his actions for or against the EU and the Euro. 1273_1.gif
George Soros is one of the richest men in the world. His influence in the economic world is great, but with his Soros Foundations he is also engaged in the development of Eastern and Central Europe. In October he will give a lecture about his vision of Europe including perhaps his actions for or against the EU and the Euro.
The Soros Network
The influence of George Soros on both financial markets and the political arena is well known. So great is his influence is that whenever unexpected turn of events happen in the world of politics and economics concerned parties and conspiracy theorists alike never fail to look for the "Soros connection". Likewise, his words and actions are constantly monitored for any tell-tale signs as to what his next move might be.
This fall many people throughout Europe and beyond will be looking carefully for such signs. On October 4th George Soros will speak at the 50th anniversary conference of the Europese Beweging Nederland. The theme of the conference will be European values and norms, and organisers are hoping that he will use this conference to make a significant statement concerning the values and identity of Europe.
Yet speculators in Europe speculating on the grand speculator may be in for a disappointment if they are counting on Soros revealing something predominantly different. It has already been noted that Soros is working on a Declaration of Interdependence. This nothing new nor original; neither should it come as a surprise that there are other declarations with this same name.
The coming years are critical ones for Europe: enormous political prestige has been vested in the European Monetary Union (EMU) project set to begin in 1999, and failure to deliver on what has been promised will have incalculable consequences for the process of European unification - not to mention the fact that it would severely threaten the survival of many governments. Hence, support for the project as well as its political foundations is being solicited all around.
As the Euro Summit in Amsterdam earlier this year made apparent, the risk of popular discontent over the EU, and the EMU project in particular, is very high. This year has been another difficult one for Europe as reductions in government subsidies and expenditures, coupled with rising unemployment rates, has become a focus of political opposition to ruling governments. Furthermore, the failure of government leaders to come to a consensus during the Euro Summit has sent mixed signals concerning the future of the EU.
For European leaders, the hope that Soros will give his public support to the EMU project - both from a political and economic standpoint - is important. Although Soros has continually maintained that his philanthropic foundations and business activities are totally independent of one another, it is inconceivable that the left hand doesn't know what the right hand is doing; in turn, it's not unlikely that there is some sort of collaboration between the two. It may very well be true that both entities are independent of one another; however, neither of them are independent of Soros, and the one at the very top of the pyramid is one and the same person.
There is every reason to believe that Soros would be in favour of a united Europe. First and foremost, his support for the EU would be based on his main fear - that of nationalism. Accordingly, a united Europe would act as the best kind of assurance against a rise of the far right. In addition to this, Soros is highly critical of free-market capitalism. Subsequently, by synchronizing the economies of Europe there is hope that the EU can establish itself as an economic power which can withstand the levelling effects of an Americanized global economy. In this case, Soros would point to Europe's traditionally higher social standards and values, and appeal for interstate co-operation in face of American-style predatory capitalism.
Unfortunately, the scenario for a united Europe isn't as clear cut as this. It is the economic aspect of the EU which presently poses problems and makes the future so uncertain, thus raising questions as to what the content of Soros' "grand vision" will be. Although a united Europe would act as the best safeguard against his aversion to nationalism, the changing face of the EU toward more neo-liberal and market-driven approaches are in conflict with his proclaimed anti-capitalist stance, and could in the end turn Soros against the EU.
Ever since 1996 momentum towards a timely launch of EMU has been building, despite reservations and tensions over some fundamental and conceptual issues. In order to achieve a timely launch, privatization measures - such as telecom liberalization planned for January 1998 - have been pushed through. Hence, the emerging outlook of the EU, expressed in the fiscal policies and privatization measures undertaken by European governments, has been running diametrically counter to the anti-capitalist sentiment of Soros.
The fact that Soros himself is a big-time capitalist clouds the entire landscape. Privatization is one of the major grey areas of Soros: his business ventures have taken an active part in privatization processes worldwide, much of it in the area of telecom infrastructure and cultural media. In Central and Eastern Europe, for example, Soros has either been working closely with existing telecom operators (e.g., with MATAV in Hungary through the creation of C3 - the Center for Culture & Communication) or has been gaining a substantial foothold and control of digital infrastructure, as in the case of Russia.
Given the complex and often contradictory nature of Soros' philanthropy and business ventures, speculative fiscal opportunities have now availed themselves to him, for European governments are finding themselves walking an increasingly fine line as the expected launch for EMU fast approaches. An over-softening of the criteria as laid down by the Maastricht Treaty could provoke market nervousness and arouse popular opposition - especially in Germany. Moreover, if EMU was delayed all European currencies - apart from the German Mark (DEM) - would likely come under severe attack. Because of this fluid situation, an appropriate use of financial clout at this point in time can be very effective. Soros in no stranger to the havoc that market speculation can inflict on governments. In essence, it was Soros who forced the British Pound (GBP) out of the Exchange Rate Mechanism (ERM). If one had to inject a political overtone to this action, it can be surmised that by breaking the Bank of England he had, in effect, delivered a slap to the face of the British, who invariably think of themselves as an entity superior to Europe.
Along these lines, the Euro has become an Achilles heel of the EU. For this reason, the decision pertaining to EMU membership will be based on a political and not purely economic rationale. Whether Soros will use this opportunity to push forth his vision of Europe (and, if so, how he would plan to do so), or whether it will be just another occasion for him to further demonstrate the volatility of capitalism, remains to be seen. The declaration Soros will deliver at the conference of the Europese Beweging Nederland, therefore, is expected by many to send a signal as to whether he will support or pressure the Euro which, in turn, would also reflect how he feels about the EU.
Taking his statements and his philanthropic activities at face value, it would appear that Soros would be in favour of the EU, mainly as a safeguard against nationalism. He would highlight the need for economic self-reliance and the importance of Europe working together, and would be careful to point out the lessons of fragmented Europe's tragic political history. He would also exalt Europe's cultural mosaic and the contributions made in the field of scientific research and education. At the same time, he would entreat Europe not to abandon its traditionally social orientation in terms of government subsidies and expenditures, and to maintain a high standard in terms of social policies and welfare - including cultural and educational support -- as a counterweight to the debilitating effects of free market capitalism.
In the end, the way in which this message will be delivered by Soros - along with the way in which it will be received by European leaders - will undoubtedly have a resounding impact on the future of European unification.