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George Soros on 'The Age of Fallibility'

Philanthropist and investor George Soros is the chairman of Soros Fund Management and the Open Society Institute. His new book is The Age of Fallibility: Consequences of The War on Terror. Soros, whose worth has been estimated at over $7 billion, has directed his philanthropic efforts toward defeating George W. Bush in 2004, overthrowing communism in Eastern Europe, helping black students attend university in apartheid South Africa and repealing drug prohibition laws internationally.

33:45

Other segments from the episode on July 13, 2006

Fresh Air with Terry Gross, July 13, 2006: Interview with George Soros; Interview with William Schambra.

Transcript

DATE July 13, 2006 ACCOUNT NUMBER N/A
TIME 12:00 Noon-1:00 PM AUDIENCE N/A
NETWORK NPR
PROGRAM Fresh Air

Interview: Philanthropist George Soros discusses his book, "The
Age of Fallibility," why he thinks main obstacle to a stable and
just world order is the US, his donations to groups working to
defeat President Bush's re-election and his charitable foundations
TERRY GROSS, host:

This is FRESH AIR. I'm Terry Gross.

George Soros says he did everything he could to prevent the re-election of
George W. Bush. What he did was donate over $25 million of his own money to
the voter mobilization group America Coming Together, as well as to Move On
and other liberal 527 or soft-money groups. Soros is one of the wealthiest
people in the world and one of the biggest philanthropists. He founded the
Open Society Institute and a global network of foundation dedicated to
supporting programs that focus on public health, education, media, human
rights, as well as social, legal and economic reform. He says his political
activities are separate from his institute. He made his fortune by creating
one of the world's largest hedge funds.

He was born in Hungary in 1930, survived the Nazi occupation and moved to
England in 1947 after the country became communist. He came to the US in
1956.

Soros has written a new book called "The Age of Fallibility," in which he
explains why he thinks the Bush administration and its war on terror has led
us in a dangerous direction.

You write in your book that the main obstacle to a stable and just world order
is the US. You say, "The Bush administration is setting the wrong agenda.
The rest of the world dances to the tune the US is playing, and if that
continues too long, we're in danger of destroying our civilization." You also
say, "The US has fallen into the hands of extremist ideologues, led by Dick
Cheney and Donald Rumsfeld, who believe that the truth can be successfully
manipulated." You write, "Changing the attitude and policies of the US remains
my top priority." Why? I mean, you've funded many philanthropic things in
your day. Why is now changing the attitude and polices of the US your top
priority?

Mr. GEORGE SOROS (Investor and Philanthropist): Well, ever since I've
started my philanthropy, it has been directed at promoting democratic open
society, and I've taken a stance in those countries. I've supported people
who stood up to repressive regimes. And when I found that the United States
has strayed from being an open society--being, let's say, living up to the
principles of an open society, I felt that I have to take a stand, and I've
done that in a--my personal capacity.

GROSS: Now, considering the amount of money that you have to help you take
that stand, some people are cheering you and others find this a kind of
frightening thought because someone with a lot of money wants to use that
money to change US policies. What kind of thinking have you given to, is
trying to change US policies, trying to change US government an appropriate
use of a very wealthy person's money?

Mr. SOROS: Well, I do it within the limits of the law. I'm actually
concerned about the role of money in elections. I've been--as a foundation,
we have been supporting campaign finance reform. But I play by the rules that
prevail, and I stand up in what I say and also in my personal contributions.
All my political contributions are, of course, tax deductible, and so they
come out of my income, not out of my foundation.

GROSS: You gave a lot of money to moveon.org and to...

Mr. SOROS: That was all my money.

GROSS: Oh, your personal money. Right.

Mr. SOROS: Yes. Yes. Yes.

GROSS: And you gave money to them and to, I think, a couple of other groups
in their efforts to defeat Bush and elect Kerry in 2004, and yet you write, "I
do not feel comfortable about engaging in partisan politics, especially since
the Democratic Party does not stand for the policies that I advocate. If it
did, it could not be elected." So, what are your differences with the
Democratic Party?

Mr. SOROS: Well, probably the major difference is that I believe that when
we adopted the war on terror as our policy, we went off in the wrong direction
because this is a false metaphor. It has been taken literally, and it has,
first of all, had the opposite effect of what was intended and also undermined
our--the principles of an open society which do prevail or used to prevail in
America. You see, a war inevitably creates innocent victims, and we abhor
terrorism because it kills innocent people for political goals. So, when you
wage war, you can't avoid killing innocent people. When you wage war against
terrorists who don't let their variables be known, you are even more likely to
have innocent victims, and then when you wage war on an abstraction like war
on terror, then that can create a multitude of sins, and, in fact, it has done
so, and I don't think that the Bush administration has engaged in the war on

terror with good intentions. I think it exploited the very natural shock and
trauma that people suffered from the terrorist attack for political purposes,
and that is what I take an--take an objection to.

GROSS: But do you feel that the Democrats haven't been strong enough in
objecting to how the Bush administration...

Mr. SOROS: Yes.

GROSS: ...has been waging the war on terror?

Mr. SOROS: I think that the Democrats have bought into that phrase. They've
accepted it because the whole country has accepted it, and as a result, they
really don't offer a viable alternative to the Bush administration's policies.

GROSS: So why are you supporting the Democrats anyways?

Mr. SOROS: I'm supporting the Democrats because we do need an alternative.
I'm disappointed in the degree to which they have bought into the war on
terror.

GROSS: If you're just joining us, my guest is George Soros, the investor and
philanthropist. He's also the author of the new book, "The Age of
Fallibility: Consequences of the War on Terror."

You put over $25 million into the political campaign in 2004 in your attempt
to defeat President Bush. Would you invest that much in 2008? Do you think
you'll feel as strongly and that you'll want to give as much of your money?

Mr. SOROS: No. I think that 2004 was a very special moment in history,
where if we had repudiated the Bush administration's policies, we could have
sort of written it off as a temporary aberration and we could have regained
our place in the world. As it is, President Bush was re-elected, and the rest
of the world has been confirmed in an anti-American posture. And this now
needs to be remedied, and we have to rethink why did this happen and what can
we do about it? And that is what I tried to do in the book.

GROSS: Let me just quote something Fred Wertheimer said, and this was
something he said to Jane Mayer for a New Yorker profile of you, and he is
president of Democracy 21, a group whose goal was to eliminate the undue
influence of big money in American politics. And he said, `I understand how
important this election is but when George Soros puts millions of dollars in,
it's creating the image that there's a special right that the very rich have
to determine the outcome of elections.' Now as someone who's a strong believer
in open societies, does that thought bother you, that you are or you are
perceived as somebody, who can really, like possibly determine the outcome of
an election through the money that you put in. As it turns out, you failed
to--you failed to determine the outcome of 2004, but still what about that
thought? Does that trouble you?

Mr. SOROS: Of course, it bothers me because--but that's the way our system
currently works. If you think of, let's say, me trying to influence American
public opinion and compare it to another rich man, Rupert Murdoch, well, who
has more influence? He controls a number of media and he can impose his view
through those media. So I'm just another player and a relatively
insignificant one compared to those rich people, media moguls that control
American public opinion.

GROSS: Now you write in your book that--you say you recognize that no one
elected you or appointed you as a guardian of the public interest and that
people are rightly suspicious of someone who can have a policy but is not
accountable to the public. So how do you weigh that in your mind? You know,
like, you have enough money to try to influence policy and to, at some point,
be successful in doing that, but you're not accountable to the public. You're
a private person.

Mr. SOROS: Well, I am a private person, and so I'm also the people to
who--who in fact--all the people who give money to political causes or to
philanthropic causes are private individuals and, as such, they are not
accountable. They are not elected officials. I don't see anything wrong in
that. I mean, that's our system.

GROSS: My guest is George Soros. His new book is called "The Age of
Fallibility: Consequences of the War on Terror."

We'll talk more after a break. This is FRESH AIR.

(Announcements)

GROSS: My guest is investor and philanthropist George Soros. He has a new
book called "The Age of Fallibility: Consequences of the War on Terror."

You know when I read about you and hear you talk, I can't help but wonder if
you have something of a divided personality, and here's what I mean. There's
a part of you that's been incredibly successful in the markets and in
speculation. And you know, most fortunes aren't made by being like the
nicest, most sensitive, you know, person. You have to be--you have to be
tough. And you have to gamble and take risks and sometimes invest
things--invest in companies that aren't necessarily doing the most good for
the world. What they're doing is making the biggest profits. So there's that
part of you. But there's also a part that takes a lot of those profits and
tries to use them in ways that you believe will do the most good for our
country and other countries as well because you have philanthropy groups
around the world. Now many people might disagree with your philosophy of
philanthropy, but still, in your mind, you are trying to do the most good that
you can with a lot of this money. So do you feel like you have two
personalities: the more ruthless speculative investor part and the more
generous, trying to figure out what's best for the overall good philanthropist
part?

Mr. SOROS: Well, I think that sort of--I'm like most other people, have sort
of rather complicated personalities. I don't think that I have a divided
personality, but I do take different positions or play different roles in
different situations, like most of us do. And generally, as a general rule,
I'd say, in making money, in my investing, I'm trying to be successful and
make a profit. Then as a human being, I'm concerned about the world in which
I live. I want to make it a better place, and that's what I use my money for.

GROSS: Do you ever worry that some of the things you've invested in are doing
things that are counter to your philosophy as a philanthropist, that they're
increasing pollution or doing things that contribute...

Mr. SOROS: Yes.

GROSS: ...to class disparity?

Mr. SOROS: You see, I think that being an investor in financial markets, to
some extent, to a very large extent, these problems don't
arise...(unintelligible).

GROSS: Because you're not investing in individual corporations?

Mr. SOROS: No, no. I do invest in stocks, but, you see, my buying or
selling their stock doesn't really change the price of that stock except in a
very marginal, infinitesimal way. If I didn't buy or sell that stock,
somebody else would, and therefore, I don't have any effect on the outcome.
This is actually how an efficient financial market works. Financial market is
amoral in that respect, because individual investors can't affect the outcome.
And that's a very happy position to be, because then I don't have that moral
problem. If I were running a business, then I would have more of these
problems, but as a financial investor, I don't.

GROSS: But, you know, you can argue...

Mr. SOROS: Now...

GROSS: ...that by saying, `Well, the market is amoral,' therefore you can
invest in it without worrying about your personal morality. You can argue
that's just a rationalization.

Mr. SOROS: No, I don't think so. I think that--you see, amoral means that
moral considerations don't enter into it. That is to say that your buying and
selling a stock, as long as you are an anonymous investor, doesn't change the
outcome, so you are not influencing it. That is--that is a fact. Now, when
you become a public figure, then the situation changes, but as an investor,
you really don't affect the outcome. So you don't really need to have these
moral concerns.

Let's say you are opposed to alcohol, and therefore you don't buy companies
that make drinks. The company will have no difficulty in raising capital so
your opposition or your abstaining from buying the shares doesn't have any
effect on reality. I think it's an important point to recognize.

GROSS: I should say, though, that in spite of what you're saying about how
your investments don't really have an impact on anything, you were accused of
affecting the economy of England, of contributing to the Asian financial
crisis, so I mean, whether you agree that you did or not, still it's clear
that your investing stock can have an impact on whole economies.

Mr. SOROS: Well, that's where things get a little difficult. In the case
of, let's say, the devaluation of the English pound, I was a significant
player, but actually I did not affect the outcome. The pound would have been
devalued even I hadn't been born. In other words, I was just one player, and
I was successful because there were a lot of other players. If I had been the
only player, I would have lost money. It wouldn't have happened. So this is
an important thing about markets, that individual investors don't affect the
outcome.

GROSS: You've been criticized by the right--some would say you've been
demonized and smeared by the right. You've been called Satan, a
Hungarian-born descendant of Shylock. Rightmarch.com had a radio spot that
said you were funding an all-out drive to undermine American sovereignty, and
that after buying the Oval Office, you plan to subvert America's morals and
trash our values. Tony Blankley, the editorial page editor of The Washington
Times, said, `Soros is a self-admitted atheist. He was a Jew who figured out
a way to survive the Holocaust.' What is the most offensive thing that has
been said about you?

Mr. SOROS: Well, I think you had a good list there. And I think it just
demonstrates what I'm up against and what I take an objection to. So these
kind of criticisms actually egg me on to stand up and to criticize this public
discourse.

GROSS: Does it get to you personally? I mean, how do you react to it when
somebody calls you Satan?

Mr. SOROS: Well, I suppose it does get to me and sort of--I can't quite
laugh it off, but as I say, it rather eggs me on than makes me retreat. What
it does a little bit is makes me concerned that maybe I get too sort of biased
in my opposition to it, and you know, I'm on the borderline of doing that in
the book. I hope I'm on this side of reality, and I haven't gone over board.
But it has provoked me.

GROSS: Are you saying that you don't want your rhetoric to become...

Mr. SOROS: Too shrill.

GROSS: ...too shrill.

George Soros will be back in the second half of the show. His new book is

called "The Age of Fallibility: Consequences of the War on Terror."

I'm Terry Gross, and this is FRESH AIR.

(Soundbite of music)

(Announcements)

GROSS: This is FRESH AIR. I'm Terry Gross, back with George Soros. He's one
of the wealthiest men in the world and one of the biggest philanthropists. He
made his fortune as an investor, then founded the Open Society Institute. His
new book, "The Age of Fallibility," explains why he thinks the Bush
administration and its war on terror have left us less secure. He donated
over $25 million to groups working to prevent Bush's re-election.

Now, we've been talking about funding political groups, but you also fund
groups in America that deal with death and dying, with drug treatment. In
fact, in June you announced plans to give $10 million to US cities to help
them build comprehensive public drug treatment programs. Are some of the
programs that you fund through the Open Society Fund, are some of those
programs that you think the government should be funding, or do you think this
should be the province of private philanthropy?

Mr. SOROS: No, they are the appropriate province of private philanthropy,
and some of them are controversial, but they basically are all guided by a
certain philosophy, a certain view of the world, which I tried to explain in
the book, and so, it may not make sense to somebody looking at it from the
outside. How come--how did I get involved, for instance, in the drug problem?
But, you see, in my philosophy, I argue that our understanding of the world in
which we live is inherently imperfect, that we act on the basis of
misconceptions, that misconceptions play a very important role in shaping
reality, and very often, when we are confronted with an insoluble problem, our
response makes the problem worse rather than better. And--for instance, the
war on drugs is an example, because I think it has actually done more harm
than drug addiction itself, and then, of course, now the war on terror is the
one that I think really has got us into a very bad situation.

GROSS: Now, let's go to the war on drugs a second. One of your controversial
views is that you think marijuana should be decriminalized. Are there any
other drugs that you think should be decriminalized?

Mr. SOROS: Well, I think that generally we need to treat the drug problem as
a public health problem and as a social problem, not as a criminal problem.
I'm not for legalization of drugs, but treating drug addicts as criminals
really is not the right way because they need treatment, and if you treat them
as criminals, it's very difficult to treat them as addicts. So I think this
is now being demonstrated. I'm very proud of the work that has been done in
Baltimore, where I set up a branch of the foundation and where there's a very
serious drug problem, and I think it is being brought under control by
offering a lot more treatment.

GROSS: Let me ask you something more personal. You write in your new book,
"The Age of Fallibility," that your father had volunteered to serve with the
Austria-Hungarian Army, and he was captured by the Russians and taken as
prisoner of war and sent to Siberia. What year was this?

Mr. SOROS: That was 1914, of course, and I think he was taken prisoner in
1916.

GROSS: And you say, "he had been very ambitious but he came home a changed
man. He lost his ambition and wanted nothing more from life than to enjoy it.
He had no desire to amass wealth or become socially prominent." Did he talk to
you about this change in philosophy when you were growing up?

Mr. SOROS: Yes. I think he had a tremendous influence on me, and, of
course, particularly then when the Germans occupied Hungary and being Jewish
we would have been deported, and he knew how to handle that situation. That
was a really formative experience in my life.

GROSS: What did he know how to do?

Mr. SOROS: Well, see, he learn in the Russian revolution that sometimes
normal rules don't apply. That if you, let's say, just behave as if--as you
normally do, you perish. So you need to take actions that you wouldn't
normally do. Like, for instance, live with false identity. So he was
prepared, mentally prepared, recognizing that the Nazis were bent on
exterminating Jews, that you just had to protect yourself and you had to do it
actively, so he not only helped his immediate family, but he helped a lot of
other people, and successfully so. And, you know, not everybody survived, but
most of us did. And that was a very important influence in my life, and I
think, in many ways, I'm sort of following in his footsteps.

GROSS: Let me get back to philanthropy. Recently Warren Buffett donated over
$30 billion of his fortune to the Gates Foundation, run by Bill and Melinda
Gates. I know a lot of people are saying this is creating a new model for
philanthropy, that one incredibly wealthy person gives a lot of their money to
another incredibly wealthy person who has already started a foundation. Does
this, in your mind, create a new model? What's new about it?

Mr. SOROS: Well, I think it's a very far-sighted and rather unselfish thing
for him to do, and I really admire him for it. When I started out, I actually
piggy-backed on the Ford Foundation, because they did a very thorough job in
investigating various institutions and active in human rights, and if the Ford
Foundation gave them money, I thought they must be OK, so I could give them
money without too much investigation. And this is a very good way to be
active in human rights. So I think he did the right thing.

GROSS: Now you've decided to keep your foundation going after you die. There
was a time when you thought you would close it, but now you've decided to keep
it open and I believe to entrust it to the care of your sons?

Mr. SOROS: No, no, no, no, no. It will have a board of its own. One of my
sons will probably be on the board because he's interested in it. Maybe more
than one. But it will have an independent board, and the reason I've done it
is because I think that there is a genuine need for a foundation doing the
kind of work we do, and it doesn't really depend on me doing it. And
basically the function is to support civil society in monitoring and holding
governments accountable. That I think is an important function that doesn't
get a lot of support, particularly in less-developed countries, and it does
need supporting, and that I think is the main mission for the foundations
after my death. Now, my foundations have always been rather venturesome, and
how to maintain that kind of sort of risk-taking, that will be a challenge,
because I could do it, because it was my money, but board members who sort
of--are guarding money that I entrusted to them will probably be more cautious
than I am.

GROSS: George Soros heads Soros Fund Management and the Open Society
Institute. His new book is called "The Age of Fallibility."

Coming up, we talk about conservative philanthropy with William Schambra,
director of the Bradley Center for Philanthropy and Civic Renewal at the
Hudson Institute.

This is FRESH AIR.

(Announcements)

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *

Interview: Philanthropist William Schambra discusses charitable
foundations and how far they should go in engaging in politics
TERRY GROSS, host:

My guest, William Schambra, is a leading figure in conservative philanthropy.
He's the former director of programs at the Bradley Foundation, which has
supported conservative think tanks and publications, as well as many education
and community programs. He now directs the Bradley Center for Philanthropy
and Civic Renewal at the conservative think tank, the Hudson Institute. The
center has held conferences about the goals and methods of philanthropy.

William Schambra, welcome to FRESH AIR. I'd like to start by quoting
something from a flier for a symposium that your group sponsored. The
symposium was called "When Nonprofits Attack," and the flier asks the question
"Is activism a charitable activity? How far should charities go in engaging
in politics?" What made you even want to ask that question?

Mr. WILLIAM SCHAMBRA (Philanthropist and Director of the Center for
Philanthropy and Civic Renewal at the Hudson Institute): The reason we chose
the topic was that increasingly nonprofits in the United States are becoming
interested in the word--the shorthand is `advocacy,' and what that means is
attempts to influence public policy. Nonprofits are often funded to do this,
of course, by foundations of various sorts on both the right and the left,
because it's a way of using what foundations understand to be their own
limited resources to have a maximum impact on public policy. And "When
Nonprofits Attack" was just a kind of a gimmicky title to suggest that
nonprofits, in fact, are--well, the shorthand would be this. In the old days,
the warm fuzzy, cuddly nonprofits that just do charitable activities suddenly
turn into political activists, sort of like the animals on "When Animals
Attack." It's--it was just a clever way of getting at this point of political
activism--increased political activism on the part of nonprofits.

GROSS: Well, getting back to the question posed in that flier, "How far
should charities go in engaging in politics," is there a point that you
consider to be going too far?

Mr. SCHAMBRA: Well, there's a point that the law considers going too far,
but the law is extraordinarily generous in what it permits. The difficultly
is this: The nonprofit sector is increasingly reliant on public funding at
all levels of government for its source of revenue. It's less and less
dependent on foundations, less and less dependent on private charitable
contributions. The difficulty is that as nonprofits become more politically
active, it's almost invariably in one direction, and that is in the direction
of acquiring more funding for public programs, more funding for themselves.
They begin to appear to the public to be less charitable and more sort of
political activists, politically active, and that--if the public comes to see
the American nonprofit sector as primarily a realm of political activity, and
politically--political activity aimed at raising taxes and increasing
government, I think that would be--that would be a gross disservice to the
sector.

GROSS: I think critics and supporters of conservative causes are impressed at
how very effective conservative foundations have been in funding a network of
conservative think tanks and conservative media that have served as a
megaphone for conservative messages. So is it fair to say that there's never
been anything like that before? Like the network of foundations that have
funded this network of conservative think tanks and media?

Mr. SCHAMBRA: Well, no, that's not--that's not quite historically accurate.
I think at the turn of the 20th century with the rise of the first big
foundations like Carnegie and Rockefeller and the Russell-Sage Foundation with
the establishment of some think tanks, like the National Bureau of Economic
Research and Brookings Institution and other such institutions, this was the
first time that you had foundations and some serious think tanks and
nonprofits devoted to what they understood to be influencing public policy.
We don't think of it as an effort to influence public policy, because they
themselves denied that. They themselves claimed that they were being
nonpartisan above the political fray. They weren't seeking to achieve some
sort of advantage for one political party or the other. They were just
preparing the facts, and the political leaders, the elites would then take the
facts and make public policy accordingly.

Now, looking back from a time, let's say, of slightly more conservative bent,
you can see that almost invariably these objective facts and the elites that
employed them pointed toward an increase in federal power, an increase in
regulation, a substantial growth of government at all levels and a substantial
harnessing the private sector to government regulation of all sorts. So
conservatives--and this incidentally came over time to--and the same
foundations that funded those think tanks ended up funding a lot of the
university programs in public policy. And so through the '30s and '40s, you
ended up with, you know, a very distinctly liberal bent to the universities, a
progressive bent to the universities, which in the '60s then took a kind of
radical turn. So looking at this constellation of forces, let's say, in the
'60s, the conservatives began to see--well, wait a minute, all the big
foundations are liberal, most of the think tanks are liberal. There's a
famous episode incidentally in which critic--conservatives were criticizing
Richard Nixon for employing experts from the Brookings Institution to help him
formulate his first policies, and Nixon simply said to them, `Look, you know,
this is all there is. This is the only game in town.' So in the '60s,
conservatives looked at this constellation of forces and decided that they
needed to establish their own. And they did, you know. They then went on to
fund a number of think tanks and nonprofits devoted to public policy, like The
Heritage Foundation, the American Enterprise Institute, the one I work for,
the Hudson Institute. But these were not original, new, shockingly different.
It was just a--the conservative effort to kind of counterbalance the liberal
predominance in this sphere.

GROSS: There's a criticism of some of the, you know, conservative think tanks
and publications that they're really more about advocating an ideology than
about an open-minded sense of scholarship or journalism, and I wonder how
you'd respond to that?

Mr. SCHAMBRA: Right. Well, as I say, that depends on--the basis for that
charge is that if you're a progressive think tank, then you are nonpartisan,
open-minded and above the fray. If you're a conservative think tank, you're
partisan, narrow-minded and engaged in the dirty business of politics.
That's--that depends on, as I say, a way of describing the various political
forces going back to the progressive era at the beginning of the 20th century,
and it's an unfair way of describing conservative think tanks as opposed to
progressive or liberal think tanks, I think.

GROSS: My guest is William Schambra. He directs The Bradley Center for
Philanthropy and Civic Renewal at the Hudson Institute.

We'll talk more after a break. This is FRESH AIR.

(Announcements)

GROSS: My guest is William Schambra. He directs The Bradley Center for
Philanthropy and Civic Renewal at the conservative think tank, the Hudson
Institute.

In dealing with the kind of social programs that the Bradley Foundation has
funded, you know, because it funds those kinds of programs in addition to, you
know, think tanks and conservative publications. In thinking about that and
also thinking about the kind of philanthropy that your group examines, where
do you think the line should be between the type of social program that the
government should fund and the type of social program that should be funded
strictly by philanthropy?

Mr. SCHAMBRA: Well, I think part of the difficulty in the next 10 years or
so, as we look to constrain public resources, is going to figure out ways of
turning over some of these social functions to private philanthropy and to
charitable support. The line is--I think government does certain things very
well. It writes checks very well. It pays Social Security, it pays Medicare,
it pays Medicaid. When the function is writing a check, it does pretty well.
When the function is trying to change a life, trying to take someone by the
hand and put them on a better path, government doesn't do very well at that.
That is something that private charitable sector does much better.

GROSS: Do you think that we run the risk of having the wealthiest individuals
in our country and the best-endowed foundations in the country controlling, or
at least having a lot, perhaps too much, influence on public policy and public
debate?

Mr. SCHAMBRA: Well, that's a question that's raised very sharply, of course,
by this new development, the gift by Warren Buffett of his--a great portion of
his fortune to the Gates Foundation. I think that we're going to have to ask
that question in a way that we haven't asked it before. Prior to this time, I
would say this: that we've had enough diversity, enough variety of points of
view supported by foundations, that one can't say that it's the point of view
of the rich vs. the point of view of the poor. You've had foundations
supporting all sorts of grass-roots populist activities, as well as supporting
the sort of--some of the wealthier--some of the concerns that are of most
interest to wealthy people. But when you suddenly have a foundation that may
be worth $60 billion in perpetuity, that does raise a new and interesting
question. We're going to have to wrestle with that, I think.

GROSS: What is the question exactly? What are you concerned about?

Mr. SOROS: Well, suddenly, we have in our midst--to put in perspective,
right now, foundations give away something like roughly like $33 billion a
year. The Gates Foundation with this new gift will be giving away $3 billion,
in other words, roughly, you know, 1/11 or 1/10 of the total charitable giving
of foundations in America. It's a very substantial portion of giving, and
what the Gates Foundation then wants to pursue is pretty much what will be
pursued, I dare say.

Now so far, they have only sort of timidly gotten into the issue of public
policy. They have confined themselves, by and large, to health and public
policy--health--public health and medical concerns in the Third World. But
they have, in fact, gotten involved in some education reform initiatives in
the United States, especially the matter of reforming the American high
school. They will be drawn--I predict this--I think they'll be drawn more and
more into public policy over the next 10 or 12 years. More and more into the
effort to influence government to do what they want. And that, as I say, is
going to present a very interesting challenge to American democratic
accountability, for a body of wealth that size.

GROSS: I read that in your basement you have a 1950s Republican election
poster hanging up. I'd like you to describe the poster and tell us why you
have it.

Mr. SCHAMBRA: Well, this was--this came up in the context of a call I got
from the Christian Science Monitor during the last election to write an
article as part of a series talking about the dangers of polarization in
politics in--just before the 2004 presidential election. And I had to sort of
point out that I don't believe that polarization is a serious problem. You
know, I think that one of the things that we need is sharply defined ideas and
sharply defined debate in politics. And the notion that somehow our politics
has recently become much nastier than it's ever been before, I--it was--I
found to be not a plausible argument, and I recalled as I was thinking about
this, I recalled this poster from the early '50s. It's a picture of an
elephant with a GOP banner draped on it and the elephant is stepping on two
guys, one of whom is Joseph Stalin and one of whom is labeled New Dealism, and
the title underneath is `Let's Step on 'Em.' So it's--we've had--we've always
had periods of politics where the language can be pretty rough. And you know,
by and large, as I say, it's not an unhealthy thing that we have sharply
defined issues and sharp--sharply defined debates, and insofar as think tanks
and foundations contribute to that on both sides, you know, I think that's a
healthy thing, a good thing.

GROSS: Well, William Schambra, thank you very much for talking with us.

Mr. SCHAMBRA: Well, thank you for having me. I certainly appreciate it.

GROSS: William Schambra directs the Bradley Center for Philanthropy and Civic
Renewal at the Hudson Institute.

(Credits)

GROSS: I'm Terry Gross.
Transcripts are created on a rush deadline, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of Fresh Air interviews and reviews are the audio recordings of each segment.

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