George Soros has invested $8 billion around the world promoting free speech, civil society, and ways of making governments accountable. Noted for their early work in Eastern Europe, his Open Society Foundations grew out of a philosophical conviction: that political oppression could not co-exist with open debate over the nature of society.

Recently, the multi-billionaire hedge fund operator has found a flaw in his own reasoning, which he has shared with readers of the New York Review of Books

The success of U.S. Republican propaganda shows thinking can be quite successful in manipulating people looking for easy answers, and overwhelming the quest for truth in the process. Soros says the U.S. (which he sees as a democratic, open society from its inception) faces the “likely prospect” that it will “cease to be one.” Of course, many Canadians, seeing a secretive Harper government holding a majority, hold a similar fear.

After the Second World War, Soros, a Hungarian by birth, studied at the London School of Economics, where he became a follower of the eminent philosopher of science, Karl Popper. A noted liberal, in his two-volume study The Open Society and its Enemies, Popper advanced a thesis about the importance of free debate, and discussion in exposing authoritarian practices, so as to eliminate them. Popper’s thought inspired Soros, a refugee from Nazis oppression, into undertaking his own mission: providing citizens living under oppression with an accurate picture of social and economic reality, through the promotion of freedom of speech in civil society.

Soros is a capitalist who believes in a mixed, private-public economy. No one will confuse his concerns with those of an American radical critic such as Chris Hedges

Soros has developed a theory he calls “reflexivity” to explain how markets operate: what people think will happen becomes part of the reality of how market perform. Letting financial market players operate freely without tight supervision — relying upon assumptions of perfect information, and market efficiency — makes no sense in his view. As markets react to new information, and changing circumstances, market agents adjust their views, and the market changes. Because people think, act, and react, market instabilities occur, and create yet more instability. In the Soros world, markets fail regularly and need to be closely regulated.

Soros sees financial instability and market failure as inherent to the economy; he also thinks public action can prevent calamity, provided people understand how reflexivity interferes with market performance.

Soros made his fortune exploiting, for vast personal gain, the instability inherent in financial markets. He became famous when he mounted a successful speculative attack on the British pound, and in one trade in one day, turned a $1 billion profit.

Unlike his fellow financiers, Soros believes that the public interest should always prevail over his own self-interest, a position that sets him far apart from contemporary neo-liberals who hold the common good (such as it exists in their way of thinking) can only be achieved through pursuit of self-interest and personal gain.

Unlike the enthusiasm generated for markets by New Labour in Britain and major social democratic thinkers in general, Soros recognizes that all markets (not just financial) have major flaws. He has long propounded that education and healthcare cannot be allocated justly or produced efficiently using market principles. Markets cannot replace government organization of service delivery, Soros has explained, and laws are needed to ensure that basic human rights are enforced. Soros maintains that markets produce inequality constantly, it is a genetic property they possess.

Soros now sees that citizens do not always want to face harsh realities, even in an open society. Half-truths prevail, allowing American Republicans to blame government for financial crisis and ignore market failures.

Soros points out how George W. Bush can adopt policies “to demonstrate America’s supremacy; and they achieved the exact opposite; America’s power and influence suffered a precipitous decline.” Soros fears that when political discourse does not result in a collective search for the truth, but, as in Weimar Germany, in deliberate deception, the open society does not survive.

In The Prince, Machiavelli counsels a 16th-century ruler that holding on to power is the ultimate goal, inaugurating modern political theory. In a sense, Soros carries on in the earlier tradition of Greek ancient political thought, asking how we should live and what is the form of the ideal state. He even has plans for his own academy (Plato would approve), a School of Public Policy that will open in Budapest. He thinks humans are better at controlling nature than in governing themselves, and wants to see this problem addressed and remedied.

Duncan Cameron is the president of and writes weekly on politics and current affairs.