By Doug Meigs
George Soros said the American model is broken and urged China to adopt a more open society.
“Hopefully, (the) Chinese leadership will rise to the occasion,” he said during an international teleconference broadcast live by HKU and moderated by JMSC Professor, Dr Rusty Todd.
“It’s no exaggeration to say that the future of the world depends on it.”
Soros argued that the international ascendancy of China represents a paradigm shift from American-dominated “international capitalism” to “state capitalism. China will eventually replace America as the motor for global prosperity, he said.
Speaking from the Central European University in Budapest on October 30, his lecture: The Way Ahead, Comments on China,” was the final instalment in a five-part series broadcast to selected universities around the world.
Approximately 400 people attended the telecast in Hong Kong, hosted by the School of Economics and the JMSC. A Q&A followed the lecture. Soros replied to four questions from the HKU audience.
The “Crash of 2008” nearly destroyed the global economy. State intervention placed the system on life support, he said.
Despite an apparent economic rebound, he forecast a stalled recovery and a possible “double-dip” (another economic downturn) in 2010 or 2011.
Soros compared the economic situation to the post-World War II financial turmoil. After the war, he said America began leading global markets on an unbalanced playing field.
Soros was born in Budapest in 1930. Educated at the London School of Economics and Political Science, he moved to the United States in 1956 where he established a number of successful funds. He earned the name “the man who broke the Bank of England” in 1992 after profiting US$1.1 billion from short selling sterling during what became know as “Black Wednesday”.
A noted philanthropist, one of his best known initiatives is the Open Society Institute. According to its website, the OSI strives to “build vibrant and tolerant democracies whose governments are accountable to their citizens.”
In his lecture, Soros said that a more open society is essential to China’s future growth.
“Right now, the Chinese public is willing to subordinate individual freedom to political stability and individual advancement, but that may not continue indefinitely. Corruption is a big problem, and China needs the rule of law so that citizens can criticize the government,” he said.
“The rest of the world will never subordinate the freedom of the individual to the prosperity of the Chinese state. As China is becoming the world leader, it must learn to pay more attention to the rest of the world. But all this may be happening too fast for the Chinese leadership to adjust to. China is accustomed to thinking of itself as the victim of imperialism, so it doesn’t realize that it is beginning to occupy an imperialistic position.”
Videos of his lecture series are available on the Financial Times web site.