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  1. Beauregard

    George Soros Conjures Hitler In Attack
    On ‘Ascendant Populists’, Warns
    “Democracy Is Now In Crisis”
    posted by Tyler Durden
    http://www.zerohedge.com/news/2016-12-28/george-soros-conjures-hitler-attack-ascendant-populists-warns-democracy-now-crisis

    Authored by George Soros, originally posted at Project Syndicate,

    Well before Donald Trump was elected President of the United States,
    I sent a holiday greeting to my friends that read: “These times are not
    business as usual. Wishing you the best in a troubled world.” Now I feel
    the need to share this message with the rest of the world. But before I
    do, I must tell you who I am and what I stand for.

    I am an 86-year-old Hungarian Jew who became a US citizen after
    the end of World War II. I learned at an early age how important it
    is what kind of political regime prevails. The formative experience
    of my life was the occupation of Hungary by Hitler’s Germany in 1944.
    I probably would have perished had my father not understood the
    gravity of the situation. He arranged false identities for his family and
    for many other Jews; with his help, most survived.

    In 1947, I escaped from Hungary, by then under Communist rule,
    to England. As a student at the London School of Economics,
    I came under the influence of the philosopher Karl Popper, and
    I developed my own philosophy, built on the twin pillars of fallibility
    and reflexivity. I distinguished between two kinds of political regimes:
    those in which people elected their leaders, who were then supposed
    to look after the interests of the electorate, and others where the
    rulers sought to manipulate their subjects to serve the rulers’ interests. Under Popper’s influence, I called the first kind of society open, the second, closed.

    The classification is too simplistic. There are many degrees and
    variations throughout history, from well-functioning models to
    failed states, and many different levels of government in any
    particular situation. Even so, I find the distinction between the
    two regime types useful. I became an active promoter of the
    former and opponent of the latter.

    I find the current moment in history very painful. Open
    societies are in crisis, and various forms of closed societies –
    from fascist dictatorships to mafia states – are on the rise.
    How could this happen? The only explanation I can find is
    that elected leaders failed to meet voters’ legitimate
    expectations and aspirations and that this failure led electorates
    to become disenchanted with the prevailing versions of democracy and capitalism. Quite simply, many people felt that the elites had stolen their democracy.

    After the collapse of the Soviet Union, the US emerged
    as the sole remaining superpower, equally committed
    to the principles of democracy and free markets. The
    major development since then has been the globalization
    of financial markets, spearheaded by advocates who
    argued that globalization increases total wealth. After all,
    if the winners compensated the losers, they would still
    have something left over.

    The argument was misleading, because it ignored the
    fact that the winners seldom, if ever, compensate the losers.
    But the potential winners spent enough money promoting
    the argument that it prevailed. It was a victory for believers
    in untrammeled free enterprise, or “market fundamentalists,”
    as I call them. Because financial capital is an indispensable
    ingredient of economic development, and few countries in the
    developing world could generate enough capital on their own,
    globalization spread like wildfire. Financial capital could move
    around freely and avoid taxation and regulation.

    Globalization has had far-reaching economic and political
    consequences. It has brought about some economic convergence
    between poor and rich countries; but it increased inequality
    within both poor and rich countries. In the developed world,
    the benefits accrued mainly to large owners of financial capital,
    who constitute less than 1% of the population. The lack of
    redistributive policies is the main source of the dissatisfaction that
    democracy’s opponents have exploited. But there were other
    contributing factors as well, particularly in Europe.

    I was an avid supporter of the European Union from its inception.
    I regarded it as the embodiment of the idea of an open society:
    an association of democratic states willing to sacrifice part of
    their sovereignty for the common good. It started out at as a
    bold experiment in what Popper called “piecemeal social
    engineering.” The leaders set an attainable objective and a
    fixed timeline and mobilized the political will needed to meet
    it, knowing full well that each step would necessitate a further
    step forward. That is how the European Coal and Steel
    Community developed into the EU.

    But then something went woefully wrong. After the Crash of
    2008, a voluntary association of equals was transformed into
    a relationship between creditors and debtors, where the
    debtors had difficulties in meeting their obligations and the
    creditors set the conditions the debtors had to obey. That
    relationship has been neither voluntary nor equal.

    Germany emerged as the hegemonic power in Europe, but
    it failed to live up to the obligations that successful hegemons
    must fulfill, namely looking beyond their narrow self-interest
    to the interests of the people who depend on them. Compare
    the behavior of the US after WWII with Germany’s behavior
    after the Crash of 2008: the US launched the Marshall Plan,
    which led to the development of the EU; Germany imposed
    an austerity program that served its narrow self-interest.

    Before its reunification, Germany was the main force driving
    European integration: it was always willing to contribute a
    little bit extra to accommodate those putting up resistance.
    Remember Germany’s contribution to meeting Margaret
    Thatcher’s demands regarding the EU budget?

    But reuniting Germany on a 1:1 basis turned out to be very
    expensive. When Lehman Brothers collapsed, Germany did
    not feel rich enough to take on any additional obligations.
    When European finance ministers declared that no other
    systemically important financial institution would be allowed
    to fail, German Chancellor Angela Merkel, correctly reading
    the wishes of her electorate, declared that each member
    state should look after its own institutions. That was the
    start of a process of disintegration.

    After the Crash of 2008, the EU and the eurozone became
    increasingly dysfunctional. Prevailing conditions became far
    removed from those prescribed by the Maastricht Treaty,
    but treaty change became progressively more difficult, and
    eventually impossible, because it couldn’t be ratified. The
    eurozone became the victim of antiquated laws; much-
    needed reforms could be enacted only by finding loopholes
    in them. That is how institutions became increasingly
    complicated, and electorates became alienated.

    The rise of anti-EU movements further impeded the functioning
    of institutions. And these forces of disintegration received a
    powerful boost in 2016, first from Brexit, then from the
    election of Trump in the US, and on December 4 from Italian
    voters’ rejection, by a wide margin, of constitutional reforms.

    Democracy is now in crisis. Even the US, the world’s leading
    democracy, elected a con artist and would-be dictator as its
    president. Although Trump has toned down his rhetoric since
    he was elected, he has changed neither his behavior nor his
    advisers. His cabinet comprises incompetent extremists and
    retired generals.

    What lies ahead?

    I am confident that democracy will prove resilient in the US.
    Its Constitution and institutions, including the fourth estate,
    are strong enough to resist the excesses of the executive branch,
    thus preventing a would-be dictator from becoming an actual one.

    But the US will be preoccupied with internal struggles in the
    near future, and targeted minorities will suffer. The US will
    be unable to protect and promote democracy in the rest of
    the world. On the contrary, Trump will have greater affinity
    with dictators. That will allow some of them to reach an
    accommodation with the US, and others to carry on without
    interference. Trump will prefer making deals to defending
    principles. Unfortunately, that will be popular with his core
    constituency.

    I am particularly worried about the fate of the EU, which is
    in danger of coming under the influence of Russian President
    Vladimir Putin, whose concept of government is irreconcilable
    with that of open society. Putin is not a passive beneficiary
    of recent developments; he worked hard to bring them about.
    He recognized his regime’s weakness: it can exploit natural
    resources but cannot generate economic growth. He felt
    threatened by “color revolutions” in Georgia, Ukraine, and
    elsewhere. At first, he tried to control social media. Then,
    in a brilliant move, he exploited social media companies’
    business model to spread misinformation and fake news,
    disorienting electorates and destabilizing democracies.
    That is how he helped Trump get elected.

    The same is likely to happen in the European election season
    in 2017 in the Netherlands, Germany, and Italy. In France, the
    two leading contenders are close to Putin and eager to appease
    him. If either wins, Putin’s dominance of Europe will become
    a fait accompli.

    I hope that Europe’s leaders and citizens alike will realize that
    this endangers their way of life and the values on which the EU
    was founded. The trouble is that the method Putin has used to
    destabilize democracy cannot be used to restore respect for facts
    and a balanced view of reality.

    With economic growth lagging and the refugee crisis out of control,
    the EU is on the verge of breakdown and is set to undergo an
    experience similar to that of the Soviet Union in the early 1990s.
    Those who believe that the EU needs to be saved in order to be
    reinvented must do whatever they can to bring about a better outcome.
    By George Soros

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