The big news at Davos on Thursday was supposed to be Donald Trump’s arrival. According to reports from the Swiss ski resort, much of the town was locked down for his descent from the skies in a seven-aircraft chopper-cade. Once on the ground, the U.S. President proceeded to bilateral meetings with Theresa May and Benjamin Netanyahu, the Prime Ministers of Britain and Israel, respectively.
Predictably enough, Trump rapidly made some Trumpian news by needlessly insulting the Palestinian leaders and threatening to withhold U.S. financial aid. But on Thursday night Trump ended up getting upstaged by another elderly Manhattan billionaire: George Soros. As the President was hosting a dinner for various business leaders, Soros was across town, talking about the various threats facing Western democracies, a category in which he included the Trump Administration.
For decades now, Soros, who made his fortune as a speculator and hedge-fund manager, has been championing the values of democracy, pluralism, and individual rights around the world. He’s backed up his words by donating many billions of dollars to his Open Society Foundation. (Eighteen billion dollars in the past few years alone, the Wall Street Journal reported in October.) At the age of eighty-seven, Soros has retired from investing and spends most of his time on philanthropy. “I find the current moment in history rather painful,” he said at the outset of his remarks. “Open societies are in crisis, and various forms of dictatorships and mafia states, exemplified by Putin’s Russia, are on the rise. In the United States, President Trump would like to establish a mafia state, but he can’t, because the Constitution, other institutions, and a vibrant civil society won’t allow it.”
If the resilience of the U.S. system was encouraging, Soros intimated, there were still grave dangers to be faced, including the rise of authoritarianism in places like Hungary and the fact that under Trump “the United States is set on a course toward nuclear war by refusing to accept that North Korea has become a nuclear power.” This refusal had created an incentive for North Korea “to develop its nuclear capacity with all possible speed,” Soros argued, which in turn “may induce the United States to use its nuclear superiority preëmptively” and start a nuclear war. The only solution, he added, was to “come to terms with North Korea as a nuclear power.”
Harsh as they were, Soros’s criticisms of Trump weren’t exactly surprising. During the 2016 election cycle, Soros Fund Management donated about twenty-five million dollars to Hillary Clinton’s campaign, according to a spokesperson. This time last year, Soros called Trump a “would-be dictator” and predicted that he would fail. On Thursday in Davos, he went on: “I give President Trump credit for motivating his core supporters brilliantly, but for every core supporter he has created a greater number of core opponents who are equally strongly motivated. That is why I expect a Democratic landslide in 2018.”
More unexpected was where Soros went next. After acknowledging the dangers of climate change, he turned his attention to “another global problem: the rise and monopolistic behavior of the giant I.T.-platform companies,” such as Facebook and Google. Here was a threat, Soros suggested, that was likely to be more lasting than the Trump Administration.
As these huge companies have come to dominate the Internet, “they have caused a variety of problems of which we are only now beginning to become aware,” he explained. Echoing something Rupert Murdoch said last week, he identified one of these problems as the tech giants’ failure to pay for the content on their platforms. “They claim they are merely distributing information. But the fact that they are near-monopoly distributors makes them public utilities, and should subject them to more stringent regulations, aimed at preserving competition, innovation, and fair and open universal access.”
In economic terms, Soros suggested, the tech giants were making excessive profits and stifling innovation. And their behavior was also causing larger social and political problems. Social-media companies “deliberately engineer addiction to the services they provide,” he noted. “This can be very harmful, particularly for adolescents.” In this sense, tech companies were similar to casinos that “have developed techniques to hook gamblers to the point where they gamble away all their money, even money they don’t have.”
It wasn’t merely a matter of “distraction” or “addiction,” Soros went on. Social-media companies “are inducing people to give up their autonomy. . . . It takes a real effort to assert and defend what John Stuart Mill called ‘the freedom of mind.’ There is a possibility that, once lost, people who grow up in the digital age will have difficulty in regaining it. This may have far-reaching political consequences. People without the freedom of mind can be easily manipulated.”
Soros suggested that this sort of manipulation “already played an important role in the 2016 U.S. Presidential elections.” And “there is an even more alarming prospect on the horizon,” he added. “There could be an alliance between authoritarian states and these large, data-rich I.T. monopolies that would bring together nascent systems of corporate surveillance with an already developed system of state-sponsored surveillance. This may well result in a web of totalitarian control the likes of which not even Aldous Huxley or George Orwell could have imagined.”
Soros predicted that Russia and China were the two countries where “such unholy marriages are likely to occur first.” Chinese tech companies are “fully equal to the American ones,” and they “enjoy the full support and protection of the Xi Jinping regime.” Another disturbing possibility was that U.S. tech companies would “compromise themselves in order to gain entrance to these vast and fast-growing markets. The dictatorial leaders in these countries may be only too happy to collaborate with them, since they want to improve their methods of control over their own populations and expand their power and influence in the United States and the rest of the world.”
How are we to take all this? As the prescient warning of a defender of freedom who sees his life’s work under threat? As the ill-considered thoughts of an old man who doesn’t quite get the new age, or as something in between? In this time of Russian bot farms, rapidly advancing artificial-intelligence algorithms, and warnings about the potentially harmful effects of digital technology from former executives of Facebook and other Silicon Valley companies, Soros was surely on to something, even if his argument that “regulation and taxation” could undo online monopolies sounded somewhat optimistic.
In any case, for one night, at least, Soros had achieved the virtually impossible, and eclipsed Donald Trump from the headlines.
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